Part I: Why do so Few Understand the Market System?

The real problem with socialism, whether of the centrally planned or of the “democratic” type, is that it is not a market system. That statement gives me great pleasure and provides me with some appreciated entertainment. It gives me pleasure because it is true and provides entertainment for me because it requires explanation.

Socialists rarely have a solid understanding of the rather straightforward concepts of market economics.  They are not the only ones, of course.  By definition, socialists are hostile to the notion of free minds and free markets and hardly ever refer to “market economics”.  Rather, they prefer to characterize the market system as “capitalism,” a term derived from the ideas of Marx’s das Kapital and one that they perceive to be an epithet rather than a simple descriptor. But the market system has some most beneficial characteristics that can be credited for much of the material abundance our planet has to offer. We all should understand how markets work. Unfortunately the economics profession has done too little to get the word out on even the most basic aspects of the discipline. I can understand this, of course, since when I as a student learned the first principles of economics, I had no particular feeling for markets. Learning about how they functioned was like trying to get a grasp on the periodic table of elements and chemistry for another class.  I didn’t come really to perceive the positive characteristics of markets until some years later when I was living in a centrally planned economy and experiencing what happens when markets are not employed in the economic system. In hopes that people might be more perceptive than I was as a college student, I proceed on the conviction that a few lines on how the market system functions should be useful.

Adam Smith Understood First

Adam Smith, Father of the Discipline of Economics

It was Adam Smith who first perceived the significance of individuals engaging in informal commercial transactions that made it possible for them, their families and their societies to subsist in prosperity.  Through time, a number of fairly complex institutions tend to grow up around the efforts of individuals to engage successfully in “the ordinary business of life.” That expression was the definition of the great Victorian economist, Alfred Marshall, of his chosen discipline. That ordinary business is rendered fruitful through the specialization and division of labor that Smith found to be the core of market economics.  But the sources of capitalism’s tendency to produce economic growth and wealth also include the positive incentives that are an intrinsic part of the market system.  Many people in a given society will be inclined to work hard, study hard, and be creative in order to achieve a secure and financially sound life. We tend to look with suspicion on “materialistic” motives, but where they are zero or very low, poverty and want prevail.  In the centrally planned economies, for example, highly valued economic equality was achieved admirably. Managers of large business enterprises made scarcely more money than the janitor on the shop floor. So there was a high degree of equality in a society that other than this produced little more than poverty. Lacking the general social response to the powerful incentives of markets, the economy never could function effectively. Where the government steps in to come down hard on avarice, it also comes down hard on productivity.

So a market economy is really just all about producing to satisfy the acquisitive desires of productive people.  Life is, of course, much more than just work and income. But once work has assured an acceptable income, we still have time in our lives to pursue the other activities that can make life truly rewarding. Those other things are what we do when we are not at work eliminating poverty.  And in a healthy market society there is plenty of room for charitable endeavor, cultural expression, religious participation, civic participation, sports, educational pursuits, and on and on.  When the socialist government steps in with its youth and other mandated programs, exerting control over all the aspects of life it can manage, society is quite sterile indeed.  I have had many experiences, both alone and with my family, in the formerly communist countries of East Europe and the Soviet Union. Marxist socialism was a failure in economic terms and did little better in terms of the social and cultural effects it produced.  I write of some of these in my book, Socialism, and can assure the reader that a free society is the only place you want to live.

Part II: But How Do Markets Work?

Seeking to improve their situation in life, many individuals are willing to work hard to produce and enjoy greater wealth. The pursuit of self-interest is characterized by competitive interaction in the market, but agents are guided in their individual and joint activities as if by Adam Smith’s “invisible hand” to enhance the well-being of all. Smith wrote: “It is not from the benevolence of the butcher, or the baker, that we expect our dinner, but from their regard

to their own interest. We address ourselves, not to their humanity but to their self love, and never talk to them of our own necessities but of their advantages. Nobody but a beggar chuses (sic) to depend chiefly upon the benevolence of his fellow-citizens.” This process is not limited to single communities  or even to the nation state; it implies international trade and ultimately even economic integration in pursuit of the economic growth it makes possible.

It’s quite simple, really, why a free market works.  An individual must produce or purchase things essential for himself and family to subsist. As he* discovers that he can produce some commodity effectively, it occurs to him that someone might be interested in an exchange of some other vital item for the commodity he is producing. Or someone else might willingly purchase that commodity from him, thus providing the initial producer with the ability to purchase needed goods and services.  If no outside parties interfere in the process, an individual offers to passing travelers, say, food for their journey. The traveler will likely find the offer of a potential trading partner an auspicious one and will be pleased that he got what he purchased at a reasonable price.  The seller will likewise probably find the transaction beneficial and agreeable.  Neither is forced into the exchange – there is rarely both a big winner and an exploited loser in free transactions – since either buyer or seller is free to walk away if the deal is an unfair one.  Lenin, famed for his total conviction and commitment to Marxism, expressed it this way; the only question about each market transaction is “kto kogo?”  The translation is “who whom?” a brief sentence equipped with everything but a verb.  The question is “who exploits whom,” “who rips off  whom?” “who  cheats whom?” “who does a number on whom?” and so on. The verb didn’t need to be expressed, since all good Marxists understand exactly what is happening when a member of the bourgeoisie is dealing with someone from the proletariat. At least the Russians get the “who” and “whom” right, which is something that would not likely happen in the United States where even journalists appear not to perceive the difference between subject and object!  But enough of these terribly complex linguistics subtleties; my point is that Marx and Lenin were flat-out wrong. Commercial life is not as Marxian pessimism perceives it: there is not an exploited party in every transaction.

Part III:  Benefits of Competitive Markets

A great advantage of the market system is that it requires no external controls to function. No government is necessary to manage the day-by-day activities of buyers and sellers, but only to enforce contracts and maintain basic law and order in the production and sales of commodities and services.  Markets function with an automaticity that is most beneficial to the social order.  To demonstrate how markets function automatically when buyers and sellers transact a purchase, or sale, a chapter early in my book on socialism describes the nature of market supply and demand. Without the use of mathematics, or even of the inevitable supply and demand curves of an introductory college course in economics, the book describes markets in which expansion occurs in response to strong demand for a given good.

Market expansion normally cause prices to rise and profits to appear. The existence of net revenues is a signal for new firms to enter the market and share the profits. The growth in numbers of firms will increase the supply and cause the price to fall to a level where only enough profit is earned, i.e., a “normal” profit, to cover all costs, including a market rate of return to the manager and the owner or stockholder. This market groping for the price that is truly just is an automatic feature of free entry into the growing market. Symmetrically, an automatic adjustment occurs when the overall market demand is declining.

Where losses in an industry occur, perhaps because demand and the market price are declining, firms will begin to exit the industry. The resultant reduction in supply will cause the price to stabilize; although it could ultimately rise again, no more than a normal profit can be expected in the long term. All this occurs to the general well-being of the firm, its workers, and its consumers.

Market activity is expressive of personal freedom, creative productivity in response to perceived wants, and exchange that benefits both buyer and seller. A successful seller and natural entrepreneur will inevitably organize a few of his neighbors as workers in a firm. Large-scale production and specialization and division of labor may enhance the productivity of the group substantially.  And what motivates the members of this fledgling firm?  If they are productive and can keep costs down, through greater sales they can generate significant revenues which can become a source of general well-being for all involved.

Part IV:  Socialist Pessimism Regarding Markets

At this point the socialist mind perceives only the potential for great evil.  What if the capitalist manager can find in his heart no good will for his neighbors as they become his hired helpers? Surely, he will be so money-hungry and money-grabbing that he will pay them only an unjust fraction of the earnings their products or services produce.  Surely, in the haste to build an industrial empire he will force his laborers to work long hours in hazardous and environmentally detrimental conditions! When a gay couple enters the establishment to order a wedding cake, this blossoming robber baron will decline on the basis of prejudice to provide the cake. Consumers who get a wedding cake, other bakery goods, or any other commodity will be forced to pay exorbitant amounts. Once established, the producer will obviously form a monopoly by reducing his prices just long enough to drive all of his competitors out of business.  Then, of course, the prices will go back up higher than ever to enrich the monopolist.  Karl Marx proved, so the Marxists suppose, that all these things are inevitable and must irrevocably persist until the starving workers end the evil in a revolutionary bloodbath. Where Marx went wrong is explained at length on the basis of the analysis of numerous great minds who have rejected Marx root and branch.  Marx went wrong historically in that his predictions never came to pass. And his view of history has helped historians neither reach a realistic understanding of how the world should work nor to make successful predictions about how societies would function.

But What about Evil Markets and Evil Capitalists?

Socialists will still worry that the conditions mentioned in the previous paragraph will ultimately be realized.  They will then attempt to convince all voters that it is time for government to step in and put a stop to the abuses of the capitalists. (Communists would, of course, prefer a revolution than a ballot-box victory.) It is true, of course, that some capitalists really are greedy and dishonest. For them, we must have a government to enforce contracts and police efforts to cheat.  At the same time, history taught the capitalists over the past century or so that profits can be made without underpaying workers and overcharging consumers.  Scholarly and prescient observers (although such cannot be said, perhaps, either of socialists or of governments) gradually discovered that the saving grace of market activity is competition.  If monopoly (which is characterized by a single seller) is avoided through good policy, and if monopsony (characterized by a single buyer, such as a firm that is the only buyer of labor in a given area) is likewise avoided, workers and buyers will have choices so that their business cannot be monopolized.

If there are free choices, the gay couple seeking a wedding cake can simply purchase elsewhere.  In spite of the politically correct views of so many contemporaries, the freedom of the bigoted cake baker to choose his transactions partners should be honored as a traditional freedom of the market system. A free society values the freedom of all citizens, both the saints and the bigots.  If the prejudiced producer wants to lose the business of the gay cake consumers, his business will be less profitable and his bottom line will be sufficient punishment. (My book on socialism reviews much of the discussion on liberty that has gone on through the course of the history of socialism’s failure.) Of course, if society’s hatred for haters is momentarily sufficiently intense, the socialist solution may be preferable.  Society will then punish the hater by dispatching him to the guillotine, which will make the world a more loving place.  (I discussed the loving and loathing of socialism in a previous blog.)

Where monopoly power threatens the happy outcomes of competitive markets, clever policies can discourage monopoly power. It can do so, for example, by opening markets to new entrants from other geographic regions. Moreover, even anti-trust activities might be helpful in some cases, but one should be aware that government intervention can become deleterious long before the stage in which the advanced economies currently find themselves. If government activism and market interventionism persist long enough, markets may reflect anything but the benefits of competitive performance. The U.S. health care system, which is somewhere between Obama and Trump at this writing, is a clear example of the harm that increasing encroachment by bureaucratic forces can wield over time against public welfare.

One wonders why murder has become such a pervasive phenomenon in American society.  It seems apparent that an obsession with death is an integral part of our culture.  One might posit that as a western society (although the form and nature of our society might be changing) we are naturally aggressive.  When one goes back to our wild west beginnings, our ruthless decimation of the original Americans, our move westward with the conviction of our “manifest destiny,” our willingness to stomach the agonies of slavery, it seems that we have long been attempting to integrate death into our living culture.

Aside from any historical cultural proclivities, let me point out the role of Hollywood in this.  Many years ago I noticed a popular theme in Hollywood movies. In the first scene of the movie, the wife or the beloved of the hero is murdered.  The rest of the movie is a series of revenge scenes in which some perp or someone remotely related to the perpetrator(s) is killed.  The final scene is the culminating destruction of perhaps an entire city or some large assemblage of the bad guys who are utterly demolished in a flaming, glorious achievement of revenge.  Hollywood was at the time apparently mesmerized by death and murder; it has since grown more sophisticated in its cinematographic technologies of human destruction

One thing the objective observer must agree with is that, for Hollywood, murder is a vital, powerful, essential, sometimes even beautiful phenomenon with more than a biological inevitability. It is glorified in movies, games, literature, and especially, movies.  As an economist, I can confidently suggest that where there is a demand for just about anything, that demand will be supplied. Extensive demands result in large supplies.

Democrats are fond of assuming that guns kill people, but an unmanned gun usually does precious little damage.  People are murderers, and rarely do guns even go on trial. When you expect to stop murders, it might be supposed by one who has never thought about the problem, or perhaps any problem, that one need merely outlaw guns. Were there no guns, nobody would get shot.  I agree.  The problem is that there are guns and I hope I need not elaborate on the problem that if you ask the crooks to give up guns, it will not happen.  The honest people may give up their guns and forfeit the right to defend themselves, but the crooks will either retain their guns or obtain new ones.  The places with the strictest gun laws usually have the highest murder rates.

If you did get all the guns out of the hands of the public, the demand for murder would nevertheless inspire and invoke a generous supply.  Knives can achieve the same objective, and they give the subhuman beast with the knife a more intimate experience with the murder.  Cars and trucks can also be used when driven into an unsuspecting crowd.  Poison works as well. Even murderers can be creative.

The demand for murders is currently very strong, but not necessarily inelastic.  Our race baiters have long tried to bring out the worst racist potential in our black communities, inspiring them with the idea that it is the fault of the current white population that we had slavery in our country a mere couple hundred years back.  To this point, our militant young black population have begun to turn our city centers into murder centers, mostly killing their own, but anxious also to wreak vengeance on their local police. 

One can understand the desperation and frustration of young men with no prospects, especially once they have become attached to the consumption and sale of drugs and safely ensconced in the bosom of their gangs. The city centers have lived under democrat policies since the Jim Crow era and their lives have been exasperated by the destruction of the nuclear family and the maintenance of defunct school systems.

Less understandable are the student soldiers sponsored and promoted by the democrat resistance in the form of the Antifa and Black Lives Matter.  Relying on students to burn, loot and riot is, of course, a disservice to their communities and to the misguided and indoctrinated students.

But the crimes of neither the poor city center gangs nor the more affluent radicalized students will be deterred by a misplaced sympathy dictating an end to policing or criminal sanctions.  When they are convinced that crime is demanded by woke city administrators, the supply of crimes and murder will increase to meet the demand. Being kind to criminals simply calls for an escalation of crime.  How is it that “woke” people fail to perceive what is happening so close to their personal lives. Normal people move out of California and New York; woke folks build a wall around their celebrity property or live in fear.

Many analysts realized long ago that Hitler meant what he said when he announced that his party was the National Socialist Party.  Yes, you say, but everyone knows Hitler was a fascist!  Hitler knew that as well, but unlike many who know fascism only as an epithet rather than as a political phenomenon, Hitler knew that fascism is just another form of socialism.

You may have encountered the leftist definition of fascism: “an authoritarian and nationalistic right-wing system of government and social organization.”  Sorry, but that is false.  Many have recognized that this definition of fascism is the left wing attempt to escape the blame for what they, mostly through Hitler, have done to the world. You can tell that this is a left-wing definition when they add “far right wing” to the above definition.  See my book Socialism for an explanation of the above erroneous definition.

Let us now address some of the needed, basic definitions to understand the current situation.  Socialism is of more than one type, of course.  The most common type of (genuine) socialism is Marxist-Leninist socialism.  That is a system which places blame for the world’s woes on business organizations, viz., the corporations.  According to Karl Marx, corporations, like other kinds of firms, exploit workers and generate the hatred of the proletariat, the working class. When hatred is at a fever level, a violent revolution pursues the goal of expropriating the expropriators, i.e., sending all capitalists to Siberia work camps or to a firing squad.  This alleged exploitation is the source of hatred underlying genuine Marxist-Leninist socialist advocates and countries. This kind of socialism insists on nationalizing every business firm in the country so that the state owns all the “means of production” and manages the entire economy on the basis of a stalinistic economic planning system, a bureaucratized set of planning agencies that cannot effectively manage an entire economy.

 

In the United States, big business and the multinational corporations were for a very long time aligned politically with those who favor the free market system.  Business managers wanted business free from excessive government intrusion in their affairs.  Managers favored capitalism, markets, and individual freedom, along with private property. Because people are people,  it is necessary in such a system to have laws and institutional arrangements that assure the honesty and fairness of business in the market place.  But otherwise, the government was perceived not to have any business micro managing the country’s businesses.

That was all some years in the past.  We have watched as American business has decided that wealth isn’t all they should pursue; business should share in the status of the Hollywood and athletic celebrities.  They have opted for an alliance with the government in opposing conservative views in any form or medium.

In my book, Socialism, I wrote two long, involved chapters on how this change has occurred.  Our business schools have spent decades indoctrinating students with the notions of “stakeholder theory.” The teaching was that corporations and their leaders should display social  responsibility.  They should be woke, they should favor socialism, and when hired as managers they should be prepared  to pursue their own private, social interests rather than pursue the interests of the owners of the firm (a phenomenon economists have named “moral hazard”).  Milton Friedman, a Nobel Prize-winning advocate of free minds and free markets, called this straightforward socialism, because when indoctrinated managers pursue their own interests to channel the owners’ resources to “social” causes favoring the “stakeholders” rather than the stockholders, they are simply performing the socialist function of redistributing incomes.

Such managers are not Marxist-Leninist socialists and they are not fighting against the exploitation of the working class.  The argument that revolution must overcome the class struggle never took off in the United States, since we have never been a class society.  Social mobility pretty well took care of the problem of social classes and radicalism in America.  But as we learned from Hitler, one need not fall back on economic issues to justify socialism.  One can also hate ethnicities as well as social classes.  As Hitler could hate the Jews, Americans can be trained to hate Caucasians, who stood by (for a time, anyway) watching blacks be enslaved.  So we whites can be “woke” if we can learn self- loathing and convince ourselves we are guilty of white supremacy.  It took some time for racists to infect so many blacks with hatred of whites.

We have recently learned that the government and the democrat party have become rather completely corrupted in their relations to the powerful American high tech firms.  The weaponized, socialist government agencies have insisted on cooperation in their pursuit of a single-party government, correctly perceived as the path to dictatorship.  With the full cooperation of the tech firms, who have since inspired so many of the non-tech firms to follow their lead, they are attempting to swampify the national politics of the United States. Moreover, it appears they are approaching complete success in establishing a fascistic variant of socialism as the future of our country.

Socialism was an economic order based on government ownership and management of all the “means of production.”  For Marx and Lenin, that meant complete nationalization of all private firms and industries. Having an economic plan was a second essential for a socialist economy, and those two principles were combined with the redistribution of incomes and the pursuit of extensive social welfare policies.

The first socialist president of the United States, President Barack Obama, came to office after genuine socialism had been abandoned in most parts of the world, but economic problems and the need for economic policies remained pressing needs of that time.  After the financial freeze of 2007 much work was still needed. The financial freeze had basically been overcome by President Bush and Henry Paulson, but the Dodd-Frank recession that followed in its wake was left for President Obama to address. Obama and Larry Summers promoted a large stimulus spending package of nearly a trillion dollars, but the funds were not spent to rebuild infrastructure. Obamaexplained that no “shovel-ready” infrastructure projects could be found. As a result, this huge fund was unfortunately frittered away in support of failing local governments which had overspent on pension programs, etc., wasteful expenditures for temporary green jobs, political payoffs, and other varieties of pork. This is all addressed in some detail in my book, Socialism; the bottom line was that there was no useful economic effect from the massive expenditures, since unemployment continued to climb.

The normal pattern for business cycles is that the phase of recession is followed by a recovery. The upturn is usually sharp as everyone is anxious to satisfy pent-up demands after the recession and restored confidence drives a period of rapid expansion. The Obama administration, however, pursued anti-economic policies that thwarted economic growth in one of history’s slowest recoveries. These policies included a war on coal and carbon for environmental purposes and the Obamacare dictum that businesses must provide health care for full-time workers. The result of the latter was that firms

began immediately to hire only part-time workers.  These misfortunes were followed by the Dodd-Frank financial restrictions after the onset of the Great Recession.  Those restrictions stifled the banking activity that would have financed a post-recession, small business boom.

For these and other reasons, the recovery after 1908 was extremely slow and painful. The labor-force participation rate plummeted; the food-stamp rolls, the ranks of the disabled, and the numbers in poverty all increased dramatically. The incomes of the middle class, however, did not do so; nor have they increased in decades. In my book on socialism I wrote that “it was an insult to the intelligence of the voter when President Obama repeated incessantly that the economy was moving in the right direction, but there was still work to do. That’s like a coach of a 0-16 NFL football team insisting that ‘our last loss was only 73-3. The field goal we made was great and we’re going in the right direction, but there’s more work to do.’” (Socialism, p. 740.)

The problem with socialism is that it can do no more than put its hopes on Keynesian expenditures to stimulate a depressed economy. In the aftermath of 2007 and 2008 the Obama-Summers Keynesian stimulus was a waste. There was no socialist economic solution for the Great Recession. One can rail continuously that Reaganesque solutions are “trickle-down policies” that only help the rich, but there is no solution in this talking points criticism.

Progressives, who favor massive deficit finance to solve all problems, also favor a continuous flow of commercial regulations that tend to thwart business growth. They also favor continual tax increases to finance wasteful projects have no effective solutions for the macro economy. The Obama economy left the country stagnant, indebted and disillusioned.

 

 

Friends, as you can see from the menu at the top of the page, this website has a link to “Order a Copy” of the book.  I turned down a prestigious publisher, who wanted to publish my work as three separate volumes and charge $360 for the whole set.

But I decided to self-publish the book so you could buy an electronic copy at a very low price, or paperback or hardbound copies  at a reasonable price on Amazon. Check it out.  If you buy, your friends may think you are a genius!

Karl Marx

To understand why Marxian socialism is bitter and negative, one should understand Marx’s life. Somewhat surprisingly, it was founded upon a secure childhood. Since he never held a job, Marx was never an exploited worker. As a student he studied philosophy and religion, but thought very little of religion. He married Jenny von Westphalen, the daughter of Baron von Westphalen, but there was little class struggle in the marriage.

Because of his radical views, he was not able to become a professor, so he went into journalism. Because of the opposition he tended to provoke, he spent time moving to and living in various places in Germany, France and England. For quite some time, Marx’s unwilling parents supported him and his family. As a library researcher, writing radical tracts and tomes on economic theory, he usually had no income at all, but in addition to help from his parents, he received help from his friend and colleague, Friedrich Engels. Engels’s father was a textile capitalist and his textile factory and its exploited workers provided some financial help. From them Marx received a pittance; unfortunately, however, it was insufficient for all his family to survive his chosen poverty.

His most famous writings were The Communist Manifesto and Das Kapital, the latter being a three-volume critique of capitalism. The first volume of Kapital took him ten years to complete and the next two volumes were published posthumously by Friedrich Engels. Critics tend to believe the postponement of the publication of Das Kapital beyond Marx’s death was a result of the author’s dissatisfaction with his own attempt to resolve the incongruities in his theory of value. He never could free the theory of contradiction. To understand Marx’s theoretical problem requires a few moments of concentration.  The interested reader is invited to consult my book, Socialism: Origins, Expansion, Decline and the Attempted Revival in the United States, which treats the problem in detail.  The book also addresses Marx’s basic approach to economic theory, his philosophical theories, and the theories he borrowed from pre-Marxian scholars.

Carina Benton, a reputed journalist for The Federalist wrote this excellent article.  I recommend it highly.  The original is located at the following website.

https://thefederalist.com/2020/09/09/how-voting-for-socialism-caused-czechoslovakia-40-years-of-misery/?utm_campaign=ACTENGAGE

 

Americans should heed the lessons of Czechoslovakia, a democracy that voted for a socialist utopia only to wait four decades to win its freedom back.

By Carina Benton

SEPTEMBER 9, 2020

Democrats are now stooping to seduce voters with neo-Marxist promises to end “systemic racism,” “reimagine” policing, guarantee “free” health care, and “pay” for higher education. The lure of a socialist utopia in which the individual finds ultimate fulfillment in the state has deceived countless people throughout the 20th century. Yet in the end, that promise has delivered nothing but unprecedented atrocities and abuses of freedom.

In 1946, Czechoslovakia became the only European nation to bring communism to power through a legitimate democratic process. Czechoslovakia boasted a successful interwar democracy between 1918 and 1939. But after six years of Nazi occupation, a disillusioned, war-weary, and idealistic people fell prey to the false messianic promises of the communists.

Popular aspirations for a better, fairer society became conflated with the Communist Party mantra, and individual freedom and dignity were substituted for the oppressive power of the State.

Making The Same Mistakes

Today, Americans are witnessing a forecast of such horrors, as Democrats leverage Antifa terror tactics to threaten opponents and foist the radical left’s ideology on a bewildered population. As one Black Lives Matter insurgent recently proclaimed, “It’s time for revolution.”

Don’t expect Democrats to change tactics once in office. Vice-Presidential candidate Sen. Kamala Harris (D-Calif.) threatened as much, insisting the rioters weren’t going to stop. “Everyone beware,” she proclaimed, “they’re not going to stop until election day and they’re not going to stop after election day … They’re not going to let up. Nor should they. And nor should we.”

The social justice quest of today’s Democratic Party is a barely disguised power grab. Unfortunately, the disastrous course they’re charting won’t be easily redirected. Instead, Americans should heed the lessons of Czechoslovakia, a democracy that voted for a socialist ideal and would have to wait more than 40 years before they won their freedom back.

Socialism, the fool’s gold of political systems, assumes that the world’s moral well-being can be guaranteed through structural change. This is what radicals like Rep. Ilhan Omar mean by “dismantling the whole system of oppression” or when Rep. Alexandria Ocasio-Cortez advocates “reimagined systems of immigration and foreign policy” and “deep systemic solutions to our crises of eviction and unemployment.”

The socialist promise is intoxicating. It has been craftily adapted by cunning and power-hungry politicians throughout history, to varying conditions and diverse peoples: only through the state can the individual become a happier person, living a better life in a fairer world.

The Democrat crusade for the progress of humanity may sound enticing. But there is nothing progressive about using Marxist hate groups to impose radical left groupthink and destroy competing ideologies and viewpoints. Democrats are exploiting class and race antagonisms while lecturing Americans on the inherent evil of their country.

The Lessons of Czechoslovakia

When the people of Czechoslovakia voted the Communist Party into office in 1946, they too believed they were building on the ruins of a failed system. Czechoslovakia had functioned as a successful democracy from its founding in 1918 until it was occupied by Adolf Hitler’s Third Reich. It emerged from the war with a thirst for freedom but a loss of faith in the old order.

Communist Party propaganda convinced people that the free-market economy and the democratic political system had caused the economic crisis of the 1930s, the rise of Nazism, the Second World War, the deportation, imprisonment, and mass murder of Jews, and the defeat and destruction of Czechoslovakia. Marxism was heralded as the only solution for and safeguard against injustice, racism, violence, and war. The Communist Party urged a transformation of the system and a change within the individual if they were to progress toward fairer, better humanity.

The people willingly embraced a culture of martyrdom, sacrificing individual freedoms for the collective good and personal redemption. The Party fostered a pseudo-religious zeal in which people purged themselves of their shameful middle-class values and capitalist mentality and devoted themselves to the New Order.

The Lie of ‘This Time It Will Be Different’

People were aware of the Bolshevik terror that had been unleashed in Russia but naïvely believed that their bespoke, national road to socialism would be different. Although ethnically diverse, Czechoslovakia was relatively unified and had experienced stable democracy. It was industrially and culturally advanced with an educated population. The idea that a communist dictatorship would ever be imposed was unthinkable.

In 1946, the Communists won a decisive victory, promising a progressive, moderate, and inclusive sort of socialism. In 1948 they staged a coup and established total control. Elections would not be held again until 1990.

Democratic traditions were swept aside as political opponents were ousted, basic freedoms relinquished, and rule of law eroded. Arrests, beatings, interrogations, “reeducation” camps, and “disappearances” became a matter of course. Businesses were privatized and farms were nationalized. A planned economy run by a corrupt and inept state led to shortages in housing and basic materials.

But the Party was beyond reproach. It concocted its facts, reality, and set of behavioral norms. Faith in the system became more important than truth. Václav Havel, a writer, dissident, and first president of post-communist Czechoslovakia, explained that because the main pillar of the system was living a lie, the truth had to be suppressed more severely than anything else.

Political disobedience, real or perceived, was punished by persecution, torture, and death. It wasn’t just ordinary people who suffered. During the Slanksy show trials of the 1950s, 14 senior party officials were arrested on fabricated charges of conspiring against the Party. They were interrogated, tortured, and all save one were executed.

Some found it easier to doubt themselves rather than accept the truth that the socialist system they had devoted their lives to building was corrupt to the core. Before he was hanged, the last words of Rudolph Slansky, former general secretary of the Communist Party, were: “Thank you. I’m getting what I deserved.”

One of the other men executed was Rudolph Margolius, former cabinet chief in the Ministry of Foreign Trade, whose wife Heda Margolius Kovály details the experience in her haunting memoir “Under a Cruel Star.” The story is a must-read for anyone deluded enough to believe that socialist regimes are concerned with improving conditions for the average person. They’re interested in consolidating power for themselves. As Margolius Kovály observes, vast power reinforced by the fear of losing it is a deadly combination.

A Long Night of Tyranny

Czechoslovakia’s experiment in pursuing a socialist utopia entailed 41 years of one-party rule. Only after the collapse of the Soviet Union and a peaceful revolution was democracy restored. The fear, lies, envy, persecution, and oppression that characterized the regime followed the same pattern as every society that has suffered at the hands of socialists.

What distinguishes Czechoslovakia’s experience is that a people who had thrived under a superior form of government, and should have known better, unwittingly voted this evil into power.

Today, the Biden campaign is dangling its brand of socialist candy in front of voters, as politicians like Barack Obama and Bernie Sanders offer straight-faced lectures about the mission to “preserve” democracy and decency. But the chaos and violence in our cities paint a more accurate picture of what we can expect under a Biden administration. It bodes very poorly, indeed.

From Democrat Rep. Ayana Pressley calling for “unrest in the streets” to Marxist mobs chanting “death to America,” nothing about the left’s platform evokes the safeguarding of democratic principles. It is about reengineering the country at the expense of anyone who rejects this radical movement.

As Kamala Harris warned, this isn’t going away. With God’s grace, it will. But four decades would be a long time to wait.

Carina Benton is a native Australian living in Washington state. She is a practicing Catholic and has taught for many years in Catholic and Christian schools. She is a mother of two young children. 

 

Is social policy in socialism just a substitute for economic policy?

Socialism was primarily, of course, a system of economics. Marx and other Marxists wanted first and foremost to eliminate the capitalists, the exploitation of labor, and the property rights of the capitalist system. In the desire to eliminate all the old, reactionary institutions of society, different sorts of attacks were made on marriage, education, youth programs, and other traditions. It was therefore quite natural that when the economic program failed to prove effective, agreeable, or even viable, socialists would turn to other political pursuits.

What role did religion play in President Obama’s politics?  What religion?

In the case of the Obama administration, it was not immediately apparent that it would be so. The Obamas adopted Christianity, although the president’s heart was quite apparently captivated by Islam. Of course, his father’s dreams were Muslim and according to Muslim doctrine, everyone is born Muslim and remains so until they join some infidel religious institution. The President doubtless identifies with the faith of his father; he clearly had no grasp of Christian doctrines in spite of his joining Reverend Wright’s congregation.  Reverend Wright tipped his hand in the first Obama campaign for the presidency when he publicly spoke for “black liberation theology,” which is an offshoot of Latin American “liberation theology,” a doctrine of Marxist “Christians” that appears to have had some influence on Pope Francis. President Obama has spoken openly and ardently of Muslim culture; there were few signs of religious devotion in his emotional attachment to Islam.

President Obama’s legacy is that he installed socialism into the democrat party. He was very popular, so traditional democrats stood by quietly as he opened the way for a takeover of the party by radicals.

President Obama and environmental policy

His greatest convictions seemed to lie in the realm of environmental policy. He was perfectly willing to watch the spread of unemployment that accompanied his anti-employment environmental efforts.  On the other hand, I personally believe his efforts to persuade China and India that they should make contributions toward any worldwide effort to stem global warming was on the right track. If they do not make efforts to curb the growth of carbon, anything the U.S. does will be far too little. The reasonable approach, however,  to whatever man-made global warming there may be is simply to accommodate to its consequences as well as possible. To let hundreds of thousands, or even millions of workers subsist in unemployment in order not to reduce global warming by half a degree Fahrenheit seems far from prudent policy.

Did Obama wish to generalize human rights? For the LGBT community, yes indeed.

President Obama’s greatest social policy concern seems to have been in securing civil rights for the LGBT community. It is amazing to me that the LGBT community has gained formal and legal recognition so quickly in the United States. Sodomy laws were perfectly acceptable to our society from the founding of the colonies until the Supreme Court ruled in Lawrence v. Texas in 2003 that it is unconstitutional to bar consensual sex between adults, calling it a violation of the 14th Amendment. Social sentiment against homosexuality had existed as an integral part of the Judeo-Christian tradition for well over two millennia. One would think it might take more than a decade or two to convince Christians who always read that homosexuality is unacceptable to the God of the Bible.

It does seem refreshing to consider that that issue is between God and the homosexuals. God has commanded people to love one another and to leave the issue of theological judgment to Him. He has not required of Christians to embrace what has always been thought of among them as sin, but they are required to embrace those subject to it. My personal belief is that the LGBT community should also recognize the rights of Christians to practice their religion freely as mandated by the U.S. constitution.  Please be aware, my friend, that I respect your right to believe what you do, so long as it does no damage to others.

The purpose of this blog is merely to acknowledge that human rights are a highly important issue to socialists or progressives. I speculate that it currently plays a role larger than it otherwise might if socialists had more to say about economic policy. The long book I wrote on socialism is really focused on economics and does not address either the issues of Islam or of social policy, although I am greatly interested in the interplay between socialism and freedom. Nor do I find the issue of human rights for the unborn without interest.

The final BHO contribution to American politics remained unknown for several years after he ended his term as president.  It was that he weaponized the Justice Department and the FBI to serve as the secret police for the democrat party.  Under Obama the FBI developed the Russia Russia Russia Conspiracy Theory that President Trump was an agent of Russia.  The FBI spied on President Trump and his campaign, then subsequently on the presidency, striving diligently to feed the public all the lies that were the preoccupation of the democrats and the captive media for those years.  Those lies were ultimately debunked, but those who derive their “knowledge” of public events from the propaganda arm of the party would never hear the truth from the “media.”

 

 

Reproducing their editorial ” “Hijacking Philanthropy to ‘Reimagine Capitalism: The Hewlett Foundation proves again that Joseph Schumpeter was right.”  The Wall Street Journal, By The Editorial Board, Updated Feb. 24, 2022 11:43 am ET.

To review the original article, see it online at:

https://www.wsj.com/articles/reimagining-capitalism-hewlett-foundation-bill-hewlett-11645566987#:~:text=Behold%20the%20Hewlett%20Foundation%20and%20Omidyar%20Network%E2%80%99s%20%2440,made%20it%20one%20of%20the%20world%E2%80%99s%20storied%20companies.

Here is the article:

Hijacking Philanthropy to ‘Reimagine Capitalism’

The Hewlett Foundation proves again that Joseph Schumpeter was right.

By The Editorial Board

The 20th-century economist Joseph Schumpeter famously wrote that capitalism sows its own destruction by creating a knowledge class who despise its success. Behold the Hewlett Foundation and Omidyar Network’s $40 million gift to the paupers at Harvard and MIT to “reimagine capitalism.”

Bill Hewlett and David Packard founded Hewlett-Packard in a one-car garage in Palo Alto and made it one of the world’s storied companies. Its capitalist success created wealth for shareholders and stakeholders alike, and Hewlett established his foundation to share even more of it. But his philanthropic legacy has become one more sad example of how the wealth of capitalist donors is hijacked by future generations of knowledge-class progressives.

“For more than 40 years, neoliberalism has dominated economic and political debates, both in the U.S. and globally, with its free-market fundamentalism and growth-at-all-costs approach to economic and social policy,” the press release says. It “offers no solutions for the biggest challenges of our time, such as the climate crisis, systemic racism, and rampant wealth inequality—and in many ways, it has made those problems even worse.”

Actually, capitalism offers solutions to all of those challenges. The largest reductions in carbon emissions have come from natural gas, thanks to the market innovation of shale fracking. Competitive labor markets have helped minorities rise despite residual racism because bigotry is too expensive. The wealth created by free markets and innovation, along with global trade, has lifted billions out of poverty. Extreme global poverty has plunged to less than 10% from 45% in 1980 while world GDP has more than tripled.

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We now have fast broadband and smartphones that connect with others anywhere, anytime; 24-hour home delivery of almost anything we want; breakthrough medical treatments and vaccines; genetically engineered crops that have increased farm yields and global nutrition; cheap energy thanks to an oil and gas shale boom; and a rising standard of living for most of the world. Socialism didn’t build that.

Yet as Schumpeter predicted, people in the comfortable West, including many tech entrepreneurs, now take this prosperity for granted. “Neoliberalism’s anti-government, free-market fundamentalism is simply not suited for today’s economy and society,” says Larry Kramer, president of the Hewlett Foundation.

By “reimagining capitalism,” as the press release advertises, what these foundations really mean is putting politicians and the administrative state in charge of redistributing more of its proceeds. Yet if they had been paying attention in recent years, they might have noticed that “free-market fundamentalism” could have spared the U.S. from some terrible mistakes.

For example, when government pays people not to work, many don’t work. When government increases taxes and regulation, output declines. And when government floods the economy with money, inflation breaks out. Is 7.5% inflation helping “wealth inequality”?

The Hewlett and Omidyar grants will fund left-wing academics at the Harvard Kennedy School, Howard University, Johns Hopkins, MIT and the Santa Fe Institute to “rethink and replace neoliberalism.” As if these institutions need more money to indoctrinate young people in socialism. Endowments at Harvard ($53.2 billion), MIT ($27.4 billion) and Johns Hopkins ($9.3 billion), by the way, are swelling—thanks to investment in capitalist markets.

The Hewlett Foundation’s hard left turn is a warning to today’s successful capitalists to be wary of creating foundations or other vehicles that outlive them. Sooner or later, most of them are taken over by people who steer them for their own political purposes no matter the founder’s intent. Be careful not to finance the destruction of the system that made business success and wealth creation possible.

Correction: An earlier version misstated the size of the Johns Hopkins endowment.

The End.

That’s the article, good Reader. You should not be surprised to learn from the Wall Street Journal that there are all sorts of folks anxious to find a way to replace our market economy with one that will release them from the responsibility to fashion their own financial well-being. Others would like to be empowered to assist in the administration of such a system. Others are idealists who really would like to see the achievement of “equity, diversity, and sustainability,” supernal advantages that don’t seem to match the tactics and motives of the socialists we see in action today.

For those of good will from these groups one is inclined to express one compelling objection. That is that virtue is attributed to governmental bureaucracies. The agencies of our and other governments have been subjected to the scrutiny of perceptive scholarship. In my book Socialism, I have analyzed the motives and the institutional characteristics of administrative bureaucracies. One must remember that it is these organizations who administer any governance that is formed.

When one considers one of history’s latest governance fads the significance of this becomes apparent. I was a young economist when our profession became most enamored with Keynesian economics — the idea that government spending could make up for insufficient private sector expenditures and that in an inflationary period the government could curb its expenditures to remove excess demand from markets. These are simple and probably accurate observations. But history proved that congress (the legislative bureaucracy) and the agencies of government could never get the timing right. When we needed more taxes and spending restraint to slow down the inflationary powers, the governmental bureaucracy never did the right thing. When more spending was needed, it was not available soon enough. Finally, economists lost their enthusiasm and quit calling for fiscal and monetary policies to solve the cyclical problems.

After Lenin had been in power in the Soviet Union for some time, he warned that the Russian bureaucracy would prove to be a serious problem for the economic planning system of socialism. In actual fact, it proved to be a disaster. The state planning apparatus was always late, it always took the mechanically easier way rather than accomodating any theoretical principles that should have governed their functioning, and the bureaucracy had sufficient power (since party bosses and legislative groups are always too busy to direct economic activities and industrial regulation themselves) to meet their own objectives. They also stood in the way of any reform of economic processes that the mathematicians and scholars hoped so desperately to implement.

If contemporary academics in the United States develop clever techniques to solve the inevitable problem of hyper-centralization as they install their central planning system, they will doubtless be theoretical marvels. But those scholars won’t be available to implement them themselves. Rather, they will appear as memoranda in the halls of the bureaucracy which the bureaucrats will then implement according to their own preferences and understanding. The result will be much as we have seen in history. The “science” will be as absent as it usually is. It will be as it was in political attempts to overcome the pandemic in the United States.

Let us begin with a definition of the term insurrection. The following is a case law defining Insurrection:

Insurrection means “a violent uprising by a group or movement acting for the specific purpose of overthrowing the constituted government and seizing its powers. An insurrection occurs where a movement acts to overthrow the constituted government and to take possession of its inherent powers.” [Younis Bros. & Co. v. Cigna Worldwide Ins. Co., 899 F. Supp. 1385, 1392-1393 (E.D. Pa. 1995)]”*

*https://definitions.uslegal.com/i/insurrection/#:~:text=Insurrection%20refers%20to%20an%20act%20or%20instance%20of,from%20riots%20and%20offenses%20connected%20with%20mob%20violence.

The Democratic media and the Party have declared January 6, 2021 to have been an insurrection against American democracy. While there were those who were anxious to engage in violence, while there were interlopers trying to cause serious trouble for conservative visitors to President Trump’s electoral speech, while there were large numbers of riots of the left wing in the United States before January 6 that were much more productive of arson, looting and violence, the elevation of the January 6 event to the status of insurrectioin was strictly a media production, a political gimmick, and a fraud of the extreme left.

While January 6 was merely an excuse to punish not only some guilty of illegitimate mob activity and to persecute Trump supporters with severe penalties, there certainly has been an insurrection in the United States. The real insurrection arose from the Democrat Party’s declaration of “resistance” expressed by Chuck Shumer and Nancy Pelossi when President Trump took office.  They declared they would resist everything that President Trump attempted to do.  It was not an issue of strenuously opposing those policies and actions not in the interest of democrats; rather, it was everything that President Trump would attempt to accomplish in his presidency, much of which was extremely favorable for diverse groups of citizens.

The real insurrection arose from the violent actions of radical left extremists across the country after the death of Floyd George, who died as the result of a drug overdose. After an encounter with the police, to avoid arrest he swallowed all the drugs in his possession, so that he would not be arrested for possession of illegal substances.  An autopsy did not determine that strangulation was the cause of his death, although the nation had been appalled at the sight of a police officer kneeling on his neck in the course of his arrest.

Resulting protests organized through 2020 and beyond by the insurrectionists of the Antifa and the Black Lives Matter (BLM) did indeed amount to insurrection, insomuch as they attacked government institutions, engaged in violence with looting, burning, and violence far worse than any in the attack on congress of January 6.  The latter attack was a combination of protesters of the actual insurrection of November 3^rd in which serious election fraud was committed by agents of the Democratic Party to alter election results, together with agents of the Antifa and BLM movements attempting to turn the protest violent. 

Along with the few extemists on both ends of the political spectrum which participated in the protest at the capitol on the 6^th, the massive majority of the capitol visitors were totally peaceful citizens who stayed on the grounds without entering the building.  Many of those who entered the building did so, some commenting on the fact that the police had the guns and they had none, at the invitation of the police.

The only individual murdered on January 6^th was Ashli Babbit, an Air Force veteran.  She was unarmed, but wanted access to the congress deliberating about confirming election results.  She wanted to tell the congress only to count legitimate ballots, not all of the ballots submitted by non-registered, illegitimate “voters.”  This was Congress, all right, but they were also her representatives.  Congress protected themselves from any damage this unarmed citizen could do by having her shot execution style without a hearing.  Police around her were numerous, but rather than arrest her, they wandered away from her presence just before she was shot. Could that have been so her assassination could proceed without interference?

The Nature of the Real Insurrection in the United States

The left-wing extremists feel they are the vanguard of the Democratic Party in their attempt to overthrow the “racist” government of the United States of America, and to replace the constitution and American democracy with a Marxist, socialist “democracy.”  They are also viewed as such by many of the leaders of the Democratic Party, such as by Kamala Harris current, presumably illegitimate Vice President of the United States; Vice President Harris stated on television before her election that nobody should expect the insurrectionist violence of the riots across the country in 2020 attacking American political symbols, demanding the “defunding” of the police, and destroying the properties of many small businesses through arson and looting to cease with the passing of the summer months.  “It will not cease and it should not cease!! “

January 6 has been both politicized and propagandized by the Democratic Party and the traditional publications media in the United States.  These two institutions have demonstrated over a period exceeding four years that their hatred is so strong and that they are so desperate to destroy President Trump that their outrageous prevarication and mismanagement of the “news” reflects the same frantic irrationality as that reflected in the strictly partisan warfare that “impeached” President Trump twice and which now seeks to eject him totally from American politics and, if possible, to incarcerate him.  This media extravaganza is really just another in the long line of Democratic nasty tricks to subvert justice for President Trump.  The congressional police under Speaker Nancy Pelossi have been complicit with her in covering up what really happened and why.  Many questions remain about the nature of the “attack” on the capital, because the event has been from the outset no more than an effort to smear President Trump and his supporters.  “Hearings” in congress on the same issue have the same validity and worth as the never-Trumpers ongoing cause.

The Democrats and non-genuine/unserious/partisan media have editorialized as though this “attack” on sacred governmental institutions such as the capitol were a first ugly precedent in American history. kylee Zempell, who may not be a democrat, should be thanked for contributing the article “8 Times Left-Wing Protesters Broke Into Government Buildings And Assaulted Democracy ,” which was published in The Federalist on January 7, 2022. For that report pursue the link below.

https://thefederalist.com/2022/01/07/8-times-left-wing-protesters-broke-into-government-buildings-and-assaulted-democracy/

After many months, numerous suspects incarcerated (often in solitary confinement) for this “insurrection” had still not had their case heard. Reports were that they were confined in deplorable (political) condition. During that time, none had been charged with insurrection. The sanctimonious reference to them by the press and politicians began to break down when some of the people charged with insurrection simply made the point in court that police officers had invited them into the capitol. Television reports had also shown this to be the case and one judge observed that is clearly not the way insurrection is supposed to look. As observed earlier, there were some questionable interlopers and some inevitable hangers-on among those who did trespass in the capitol, but few were as aggressive as the thousands of Antifa and BLM radicals among the activist troops of the Biden era.