Why, as Winston Churchill pointed out, is socialism capable of generating only misery? In echoing Churchill, JPMorgan CEO Jamie Dimon recently warned shareholders that “socialism inevitably produces stagnation, corruption and often worse.”
Socialism Buries Industry with Regulation
“The textbook definition is government ownership of the means of production, as in the communist-run Soviet Union or Cuba, or the state-owned factories of China today, Andy Kessler reminds readers in the WSJ. But there is another meaning to socialism, he notes: “owning” an industry by burying it in regulation (see education, Medicare, the overregulated auto industries and so on).
Socialism is about maximizing power, not maximizing profits. Government doesn’t make profits, has no incentive to show profits, wouldn’t know a profit if it hit it in the head. Inside government there are no markets or price mechanisms to act as a divining rod finding hidden productivity. Socialism handcuffs Adam Smith’s invisible hand.
How to Destroy Wealth
Productivity is wealth. Sure, technology and markets might destroy two jobs, but they turn around and create three safer, higher-paying and more fulfilling jobs. To spend beyond a basic level for goods or services because of socialism’s political “make work” imperative destroys wealth.
The Claptrap of “Free”
Socialists like Bernie Sanders love to spend money on “free” education and Medicare for All but have no policies to make money in the first place. Their socialist construct of technology-ignoring, job-guaranteeing claptrap seems like the only way not to fund all those freebies.
Raise Living Standard thru Technology
Technological progress is the only way to raise living standards over the long run. If you hire two workers to do the job of one, you kill the very productivity needed to fund the promised worker’s paradise. Without productivity, societal wealth eventually disappears and socialism spirals into decay and the stagnation and corruption that Mr. Dimon warns us about.
Unfortunately, like Notre Dame’s now destroyed spire, socialism rots from within.
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