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Monday, June 06, 2005

Why socialism doesn't work

Bill at Reason's Edge has posted this example of why socialism doesn't work.


Blogger The probligo said...

Yep, both you and he are absolutely dead right, it is an excellent example of the over-simplified propaganda being put around at the time of MacCarthy. Note the date?

Apart from that minor little quibble, what is MOST interesting about it is the fact that the writier uses Marx' criticism of capitalism - that "CAPITAL" has the effect of separating a worker from the benefit of his labour. The way that Marx said it was that "capital" will always want to depress wages in order to maximise profit, and that as a consequence there was no incentive for the worker to produce of his best.

Yep, interesting...

6/06/2005 10:32:00 AM  
Blogger Dave Justus said...

A very poorly presented argument Probligo.

You first sentence is of course guilt by association. You make no attempt to show that either the example is not an accurate reflection of Socialism, that the effect would not be as described, or that while it is a valid comparison, and the effect would be as described, other options (Capitalism) are worse. Any of these choices would be a valid way to argue your point. Shouting 'MacCarthy' is not. If, you had made an actual point first off, then claiming that this is an example of MacCarthyism might be valid, although that seems unlikely as what was wrong with MacCarthy was not that he opposed communism, but rather the methods he employed in his battles against it.

As to your point about Marx's writing, I consider his economic analysis to be pretty throughly discredited by real world tests.

Even if one were to accept that Marx is right, and capital merely takes the benefit of a person's labor away from him, you would have to show that this effect is greater than the effect of socialisms disincentivizing of the worker and taking of benefits of labor from them to create a valid argument.

I think though that you are wrong about the relationship of capital to production however. Capital does not simply siphon away the benefit of labor. It makes labor much more efficient. A group of workers in a modern factory (provided by capital) can produce much more than those workers trying to operate on their own. Indeed the increase is so much, that one could easily argue that the workers in a factory are getting too large a share of the profits of the enterprise. Luckily, in a free market, as capital increases the wealth of a society competitive pressures force factory owners to increase their wages.

6/06/2005 02:18:00 PM  
Blogger The probligo said...

That is what comes of trying to comment on things and work at the same time... red face...

Mind you, the fallacies in the argument are many.

Suffice it to say that "taking away" something of value to one person but of absolutely no value to another is stupidity. So is the tract you promote...

6/08/2005 11:30:00 AM  
Blogger Vestigial Fish said...

A clarification: I would argue that the Marx/Engle solution as put forth in the Communist Manifesto has been proven to be incorrect, not Marx's analysis of capitalism.

Marx's analysis of the abstract mechanisms of capitalism are still reasonably good (as far as abstract models go). Keynes reached similar conclusions, and no one has accused him of being a Communist.

The major area where Marx's analysis failed was in predicting the scale of government/private intervention in the "Capitalist Cycle." He foresaw any type of deviation from this cycle as requiring gargantuan changes and Herculean effort that would forever alter society. To him, it was all or nothing. There was no way for labor to compromize with capital, or vice versa. Marx failed to credit individuals or institutions with being able to recognize and retain the benefits of Capitalism (increased production, cheaper prices, wider variety of goods) while compensating for the problems (decreased standard of living, ever steeper cycles of boom and bust, corruption).

6/14/2005 10:51:00 AM  
Blogger Dave Justus said...

Well, I'm no Keynian either.

I think that Marx's fundamental failing was two-fold.

First, he didn't realize the extent that workers would be able to command decent wages based upon their skills (this was hard to see in the early stages of the industrial revolution) AND he failed to deal with the possibility that even if Capitalism was flawed, other things could well be worse. The best system isn't necessarily perfect, it is just the best.

There may be a better way to organize economies than capitalism, but if so, we haven't found it yet.

6/14/2005 12:36:00 PM  

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