If you do not understand the economic fundamentals of capitalism and socialism, then you have no basis for separating economic truth from fiction, or facts from propaganda, or wisdom from evil. The horrific failures of the socialist experiments (for example the Soviet Union, Mao’s China, North Korea) are well recorded history. Yet so many people are unaware of the structural economic theory behind those tragedies, which allows modern day proponents of socialism to pass it off as something else entirely. Those proponents know that if they called it socialism, few would support it given its history.
We are a fan of both Old and New Testaments of the Bible. Although we agree with historians as to its inaccuracies, we have faith in its universal truths and vast wisdom. Among those wisdoms are the standards of behavior delineated in the Ten Commandments. They express the moral ethic embraced by America’s founding fathers and that became the backbone of our American culture and laws. One of the Commandments is relevant to a discussion regarding the appeal of socialism. Consider for example the 10th Commandment.
Thou shalt not covet thy neighbour’s house, thou shalt not covet thy neighbour’s wife, nor his manservant, nor his maidservant, nor his ox, nor his ass, nor any thing that is thy neighbour’s.
Socialism appeals to the ugly emotion of covetousness. It motivates by leveraging the jealousy poor men often feel for the possessions of the rich. The socialist separates the rich and the poor into opposing classes, those who own the means of production and those who work for the owner. The socialist speaks to that jealousy by saying, “They are rich because they profit by exploiting your labor. They have stolen from you what is rightfully yours.”
The socialist reasons that profits created by the working class should not accrue to the owner (whom they allege produces nothing) but instead should be distributed equally among the production workers. The owner, no longer needed, can be replaced by a manager loyal to the interests of the production workers. This all sounds so very fair and logical that it’s easy to forget that the original appeal was to ugly, jealous covetousness. The socialist also elides over the fact that, in the US, anyone can start a business if they’re willing to take the risk and work harder than they’d never thought possible. The opportunity for upward social mobility based on ability and commitment to a goal is what has made the US a magnet for innovators and achievers. In the US, social “class” is neither predetermined nor permanent.
Where the ‘fair and logical’ idea gets dangerous is in the nationalization of the means of production and the appointment of production managers ‘loyal to worker interests’. Nationalizing production requires that owners forfeit their property claims. Since US law is rooted in the ethos of the Bible, the sacrosanct nature of property ownership, and capitalist economics, a commitment to socialism would require abandonment of the current US Constitution and establishment of a new type of government. Marx describes this.
Between capitalist and communist society there lies the period of the revolutionary transformation of the one into the other. Corresponding to this is also a political transition period in which the state can be nothing, but the revolutionary dictatorship of the proletariat. [emphasis added]
Karl Marx, Critique of the Gotha Program (1875)
Contrary to its appearance of democratic populism, socialism is a “dictatorship of the proletariat.” Not dictatorship by but of. In order to transition to a socialist state, non-socialist forces and ideas must be totally suppressed. A socialist state must have only one political party. There can be no opposition party to challenge state policy and no meaningful elections that would give voice to an alternative will of the proletariat. The path of Socialism leads inevitably to the totalitarian state.
The socialist ideal can be appealing. There is an oxymoronic “emotional logic” to socialist economic theory. Socialism seems like a reasonable system for organizing resources for the betterment of all. However, the flaw in socialism is the human one. The entire structure of socialism is founded on the participation and cooperation of a united people acting in concert, whom it is assumed will agree to sublimate their individual desires and channel their energies for the collective good. The reality is that people will vary in their motives and commitment. Some people will be inspired and dedicated to the ideal; some will go along, living their lives according to the new norm; some will do the minimum required, seeking every opportunity to “free ride” the system; some will resist (and be imprisoned as counter-revolutionaries); and malicious opportunists will take advantage of all the aforementioned. The most ruthless of the opportunists will rise within the political elite and wield absolute power over the state. In the past their names have been Hitler, Lenin, Stalin, Mao, Castro, Kim, Chavez, et al.
Another major flaw of socialism is the idea that a bureaucracy can allocate an efficient use of resources for the collective good in what’s known as a planned economy or command economy. Historically, this has always resulted in misallocations, overweight imbalances between supply and demand, and an inability to respond flexibly to changing ‘market’ conditions. Rather than instilling order into national production priorities and social needs, the history of socialist states typically documents production of low quality goods not correctly targeted to the ‘market,’ and spectacular misallocations leading to poverty and even mass starvation. As an example, consider China’s Great Leap Forward era under Mao, during which 30 million perished.
Socialist planners inherently have little margin for innovation beyond improvement of existing methods and products. In a socialist society, risk-taking is dangerous regardless of the success or failure of the venture. Inventing a new method or product can run afoul of the planning bureaucracy by highlighting their incompetence or by crossing cultural boundaries instituted to restrict free thought.
Socialist societies institute cultural behavioral boundaries designed to steer the populous away from independent thought, which is negatively associated with the capitalist free market. In a socialist society free thought is a potential threat to the state’s power and therefore considered treasonous. Strict adherence to and dogmatic recitation of the “party line” is necessary for survival in a socialist state. As a result, socialist citizens rarely dare to create innovative products or methodologies. Socialist states eventually become technologically moribund, one of the many reasons for their eventual collapse.