Friday, April 15, 2005

Social Security, Socialism, and Capitalism

In a recent conversation, a young man brought up the fact that he paid $N in social security this year that he will never see. Then he went on to lament the fact that some people wanted to privatize social security.

"Have we learned nothing from the stock market crash of the 1920's?", his equally liberal girlfriend asked.

It was not a gathering I wanted to turn into a political arena, so I didn't persue it. But it did reveal a bit of a paradox and a lack of insight in their world view that I got to thinking about over the next 24 hours.

Have we learned nothing? Have we learned nothing from the collosal failures of socialist systems all over the world -- even while we witness our own limited socialist structures careening down the road to the same fate?

Why, indeed, would someone lament pumping money into a system that he will never benefit from, yet support keeping that very system on life support for, in the long run, a few more short years before the same problem catches up to it again? Why would one want to continue to throw money at that, but be leery of a system where at least you have control and ownership of your investments? (whether they do well or not is another matter -- but if you weren't counting on seeing any fruit from it anyway wouldn't you rather have more control over what happens to your hard earned money?)

The answer has to be -- religion.

One telltale hallmark of a religious belief is the sticking of one's head in the sand when presented with evidence that contradicts that belief. I mention this because most liberals I know are religion averse, or so they think. What they are is "officially labeled religion" averse. They have their religious beliefs, alright. They just don't have formal churches. Their clergy are teachers, members of the press, prominent politicians and pundits -- even movie stars and directors. So there's no physical or rigid social church structure to point to and say "that religion" (although one could arguably call it the MoveOn.Org religion). This works out well for them, because to them anything can be discounted if it can be labeled a religious belief. And I am turning that around right now and challenging the idea that their beliefs are any different from religious beliefs.

Sometime between the time when I went to school and the time this young man went to school, it became politically incorrect to teach that there was anything wrong with socialism. It also became quite fashionable to stress the evils of capitalism.

I was, in fact, taught that there was something wrong with socialism from a very early age, but I really wasn't taught what it was that was wrong with it. Basically, it was that these dictator meanies held all the power and opressed people. This often comes with socialism, but in the end, it isn't socialism and that's not what's wrong with it.

I did figure out, on my own, what was wrong with it sometime around the time I graduated from high school. I had this huge revelation, and basically, it was this:

First, let me say this: Socialism is a fabulous, very attractive ideal on the surface. In the end, it is the way we should all volutnteer to be. This is why a lot of dictators use it to get themselves into power. But, as has been shown again and again in the last 100 years, it doesn't work. The problem is, precious few people will volunteer to do this for long unless they're on the receiving end of the stick -- so they must be coerced into it.

Even then, socialism discourages production and encourages sloth.

[ production =
goods or services that contribute to society in some way

Socialism basically says that we will guarantee you a certain standard of living (a noble thought, for many are unable to produce anything of marketable value to make a living wage). In order to guarantee this, those who do produce enough of marketable value give money to the government (quite happily, and with smiles on their faces, just ask anyone ;-) ) to re-distribute to those who aren't making a living wage. And everything is dandy. Supposedly.

But there are two problems with that. Even the best of us, in the end, is somewhat self-serving -- which gives rise to the second problem which is that we are inherently lazy. People are greedy and lazy. It's not just human nature, it's nature in general. Organisms that can get the most by expending the least amount of effort (strain, energy) are the most successful, so it's just in us, and rats, and chimpanzees, and probably ameobas.

What happens when you guarantee someone a decent standard of living? You take away incentive to expend the energy to produce anything to give to society. "Take away" might be too strong (might not be, either) -- but you certainly diminish it.

But certain demands must be met by others in society for those who aren't producing to benefit, so to make up for that, more must be taken away from those who do work hard and produce. But if you work hard and produce and the government just takes away the fruits of your extra labor to re-distribute to those who produce less.... you diminish the incentive for those who have the energy and will to work to work harder.

In short, you encourage sloth, and discourage production. Not a very good system to base an economy on.

The big rap against capitalism is that it rewards the greedy at the expense of (presumably) the less fortunate. This comes from a world view assumption that there is a limited amount of wealth and if one gets more, it must have come from someone else's share. This is demonstrably, in general, untrue (in fact, it's downright ludicrous, but that is a topic for another article). What it really does is reward those who expend the energy to produce more more than it rewards those who do not. Is it perfect? Absolutely not. Is it subject to corruption? You bet. Is socialism perfect or not subject to corruption?

What religion are you again?

What capitalism does is take people's desire to have more (greed) and do better and use it to counteract sloth. It takes those two opposing forces in human nature and pits them against each other. In the end, we all do better when we pitch in and cooperate, so it encourages this pitching in and cooperation and more benefit is derived in general. Some people get obscenely wealthy, some people remain dirt poor. And that, my friends, is the way of nature, which, contrary to popular belief, we are in fact a part of.

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