Socialism: What is it? Is it Better? (EP.107)

Does Socialism Work?

Summary

Socialism in much in the news. At first glance, it might sound appealing. Needs driven by inequality will be erased. Everyone gets what they want, and no one is the worse for it.

How does socialism stand up to a deeper dive into what it is and how it works? For the next 10 minutes, we will unpack those two questions: 1. What is socialism? and 2. How does it work?

Transcript

Socialism in much in the news. At first glance, it might sound appealing. Needs driven by inequality will be erased. Everyone gets what they want, and no one is the worse for it.

How does socialism stand up to a deeper dive into what it is and how it works? For the next 10 minutes, we will unpack those two questions: 1. What is socialism? and 2. How does it work?

Firsts, let’s first pause for a mutual goal check. I am assuming that we are all looking for an economic system that simultaneously rewards talent and hard work, while taking care of those who truly need it. Do you agree? (I realize this is thumbnail summary.)

Now, let’s start with some key observations:

  • Capitalism is the greatest wealth-producing engine the world has ever seen. Some may doubt its fairness, but no one doubts its ability to create wealth on a massive scale.
  • All societies redistribute wealth. Everyone of them. Example. If all a particular society did was to tax enough to provide roads, some would pay more for those roads than others. Most people are likely to use the roads disproportionately to their tax contribution. Some more, some less; that’s an example of redistribution. The question is not whether to redistribute wealth, but what is the proper level of redistribution.

Okay, let’s add some definitions:

  • Democratic Socialism: I believe that Senator Sanders and others are talking about something other than the traditional definition of socialism. They are not talking about the government owning the means of production. They are not talking about the government owning and/or controlling entities like Ford and Facebook. Not yet, anyway. However, Senator Warren and Representative Ocasio-Cortez are beginning to introduce those thoughts. Democratic socialists are talking about massive income and wealth redistribution. Even more than we have now. The Scandinavian countries are an example of democratic socialism. Their version of socialism is capitalism with heavy income redistribution.
  • Traditional Socialism. See above, democratic socialism, with the addition of the government owning entities like Ford, Facebook and most everything else of size. You can keep your ice cream store if you have one. See Venezuela, Cuba and others.
  • Communism: Traditional socialism with the addition of prohibiting any private property.
  • Capitalism: A system wherein people, individuals or groups, including corporations, own the means of production and engage in voluntary exchanges of money for goods and services.
  • Profit: Selling things, taking in income, for more than it costs to make them, drives everything; capitalism, democratic socialism, traditional socialism, communism, no matter what the system is. Here we are not talking about taxes or what you do with taxes; we are talking about how you make the money and wealth that is taxed in the first place. You have to create wealth before you can redistribute it. The gozindas have to exceed the gozoutas or nothing works in any system.

Question: Which economic method or principle, either type of socialism, communism or capitalism, is the best approach to making and selling products and services for more than they cost? Answer: Capitalism. Absolutely no question. Remember, democratic socialism is successful capitalism, capitalism with profits, with heavy income redistribution. Without profit there is nothing to tax, and nothing to redistribute.

Capitalism is amoral, not immoral, mind you, amoral. It needs a moral compass. Democracy needs a moral compass. Any system, group or person needs a moral compass. If you don’t have a solid compass that you follow, then nothing else matters. Nothing. You will simply be a cork on the oceans of life, following the changing paths of the tides, currents and waves.

Once we have created money to tax and redistribute, there is a question of who gets what. This is not at all the key point of this podcast, but it is an important question. I say that we take care of people who can’t take care of themselves, and ignore those who won’t take care of themselves. Everyone will have a different way of defining can’t vs. won’t, but simply setting the ground rules and asking the question propels the discussion quite a ways forward.

The answer to the questions what is socialism and does it work have been answered. Do you agree that we have done that? It is also clear that capitalism, guided and controlled by a moral compass, is the by far the best engine to fund a society. How much of that money is taxed and redistributed–and to whom–is another question. And, yes, we tackle those questions in Revolution 2.0™.

All of this ties to the core, driving principles at Revolution 2.0, which are:

  1. Personal Responsibility; take it, teach it and,
  2. Be Your Brother’s Keeper. The answer to the biblical question, “Am I my brother’s keeper?” is a ringing, unequivocal “Yes.” There is no other answer.

If we apply those two core principles simultaneously, never only one or the other, we will always be on the right path. Depending upon what we face, one principle or the other may appropriately be given more emphasis, but they are always acted upon together.

The Founders, Revolution 1.0, were declared traitors by the British Crown, and their lives were forfeit if caught. We risk very little by stepping up and participating in Revolution 2.0™. In fact, we risk our futures if we don’t. I am inviting you, recruiting you, to join Revolution 2.0™ today. Join with me in using what we know how to do–what we know we must do–to everyone’s advantage. Let’s practice thinking well of others as we seek common goals, research the facts that apply to those goals, and use non agenda-based reasoning to achieve those goals together. Practice personal responsibility and be your brother’s keeper.

Let’s continue to build on the revolutionary vision that we inherited. Read the blog, listen to the podcast, subscribe, recruit, act. Here’s what I mean my “acting.”

  • Read the blogs and/or listen to the podcasts.
  • Comment in the blogs. Let others know that you are thinking.
  • Subscribe and recommend that others subscribe as well.
  • Attach links from blogs into your social media feeds. Share your thoughts about the link.
  • From time-to-time, attach links to blogs in emails that mention related subjects. Or just send the links to family and friends.

Revolution 1.0 in 1776 was built by people talking to other people, agreeing and disagreeing, but always finding ways to stay united and going forward. Revolution 2.0 will be built the same way.

Join me. Join the others. Let’s grow this together.

And visit the store. Fun stuff, including hats, mugs and t-shirts. Recommend other items that you’d like to see.

Links and References

Moral Compass

Can’t or Won’t

NYC Democratic Socialists

Contact

As we get ready to wrap up, please do respond in the blog with comments or questions about this podcast or anything that comes to mind, or connect with me on Twitter, Facebook, and LinkedIn. And you can subscribe to the podcast on your favorite device through Apple Podcasts, Google, or Stitcher.

Now it is time for our usual parting thought. It is not enough to be informed. It is not enough to be a well informed voter. We need to act.  And if we, you and I, don’t do something, then the others who are doing something, will continue to run the show.

Know your stuff, then act on it. Knowing your stuff without acting is empty; acting without knowing is dangerous.

Will Luden, writing to you from my home office at 7,200’ in Colorado Springs.

Will Luden
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  1. Tim Larson Reply

    Churchill was once asked why he didn’t like socialism when the early Christian church (see Acts) applied it successfully. His retort was that in the first century church the view was “what’s mine is yours”. When a government applies it, however, the principle is “what’s yours is mine”.

    So true!

    Carry on!

  2. Charles Cabral Reply

    First comment. You say that socialism proposes that everyone “gets what they want”. Putting aside the economic realities, the scary part is the implicit idea that government would be in a role of determining what people want. Whatever it is that I want, I darn sure don’t want some bureaucrat or politician telling me what it is.

    Secondly, it seems to me that both the proponents of socialism and capitalism become more enamored of their systems and less interested in pursuing solutions. When a social problem arises, the socialist/liberal seeks a way for the government to fix it (ignoring the unintended consequences). The capitalist/conservative, on the other hand, tends to respond by fighting all proposed government solutions and advocating some sort of Darwinian view that it will all get worked out somehow.
    Why can’t our social question be addressed by asking basic fact-based questions such as
    -Is the problem a result of government action?
    -Can government action solve or alleviate the problem?
    -What will be the unintended consequences of government action, and are they acceptable? (There will always be some)
    -Might the problem work itself out without any overt action by society?
    -Are there non-governmental solutions available?
    In order to honestly answer those questions, one must put aside labels such as socialist/capitalist/liberal/conservative/(whatever) and seek solutions first.

    • Will Luden Reply

      Charlie, I completely agree about losing the labels in favor of seeking solutions. Politically, I struggle to do that in my podcasts and life. Not quite sure about how to do that when talking about economic systems. Take a look at the podcast “Size of Government” (if you have not already) and tell me what you think. Cheers, Will

  3. Stephen Smith Reply

    Will,
    Have you considered doing a long form podcast, or multi part podcast and dig into this topic? I would enjoy hearing your insight on a deeper level.

    • Will Luden Reply

      SSG Smith, I have thought about it, along with introducing video. I am looking for the right person who help me with things like PR for Revolution 2.0™; that person will guide me in many areas–save content. And thank you for the thought and the implied compliment. Cheer, SGT Luden…:).

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