Monday, May 14, 2012

Socialism and the Corruption of Character

The debilitating effect of Socialism on peoples' characters is on full display in the series of election defeat of various incumbent pro-austerity governments in Europe. People in Greece, France and Germany have rejected the tough stance - which was just on the surface because in reality none of these governments actually lowered their spending even under the so-called austerity measures (see here) - of political leaders of suddenly stopping the political largess spigot aka free handout of money in the form of pensions, lower retirement age, government jobs, unemployment insurance etc.

As brilliantly analyzed by the German sociologist Franz Oppenheimer in his book The State, there are only two ways of ekeouting one's survival. One, through hard work producing valuable economic goods and selling them in the market receiving in return your own bread & butter i.e., money; Oppenheimer called this way the use of 'economic means', and second, stealing others' hard earned money for your survival, which Oppenheimer labelled as the use of 'political means'. As Mises, Rothbard, Hoppe and others have analyzed in their works, Socialism is a system which transfers (or redistributes) the income from the productive and propertied class of the society to the non-productive and propertyless class. And, government is the main vehicle on whose back socialism rides. Whether the government is of a Monarchical king or queen or it is of popular democratic parliament or outright totalitarian dictatorship, the underlying system of redistribution of property from tax paying class to tax consuming class remains the same.

Combined with this fact of the true nature of Socialism in its various guise, there is that selfish human nature. It is highly likely that given the option, most people on this planet would like to receive their income without doing any kind of (hard) work i.e., they will use 'political means'. Most people love free things. And, once they are habituated of receiving these free gifts from the Socialist governments, it is very difficult - if not impossible as we will see in a while - to take them off these free gifts; it is tough to change their habits very quickly in a generation or two.

On the other side, there are natural limits to any government largess because the system of transfer of income from the productive class to non-productive class results into, first, productive class losing their zeal of working hard because they know that if they earn more, government will steal that money, and second, more and more people receive incentive to jump onto government's free money band-wagon seeing it pays more not to be honest and hard working. This way the productive class - which is supporting the non-productive class - shrinks and the non-productive parasite class swells. This can go on only for sometime because as the parasite gets bigger and bigger the host slowly dies. And when the host is dead, the parasite is also dead. That means, when there is no tax paying class left to loot from, the tax consuming class also starts to die off. Sooner or later governments will have to stop their redistribution schemes and allow people to enjoy the fruits of their hard work. That means, the role of government must shrink and that of market economy must increase. This process of change can take place before it becomes too late for the society to stop the final wreckage in the form of hyperinflation or super depression if people understand the need of the hour and decide to let go the free money. But, as I said above, the spoiled habits are not that easy to correct in a generation or two. As the events are showing, it is highly likely that people will continue to vote for the Socialist redistributive governments as long as the whole economy is not wrecked. And that is where the whole world is headed now. And once the system is broke, people will be forced by the circumstances to change their habits.  

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