This month, Rolling Stone brings you economic reforms from an avowed communist. The online debate is more interesting than the article – over 10,000 comments in ten days. Jeremiah has reported how young people are turning to socialism, and this debate shows a clear split along generational lines.
People who remember the Soviet era are quick to dismiss socialist ideas, without explanation. This is unintelligible to young people, who did not have the experience. Several commentators seem to think Fidel Castro was a swell guy.
One insightful comment went along the lines of, “if you keep dismissing ideas we like as socialist, you will only persuade us that socialism must be a good thing.” They have seen where mildly socialist policies have worked, in Sweden and Canada. Such is the danger of using labels.
People could contribute the skills that inspire them – teaching, tutoring, urban farming, cleaning up the environment, painting murals – rather than telemarketing or whatever other stupid tasks bosses need done to supplement their millions.
The problem with a proposal like Myerson’s “make everything owned by everybody,” is that the money has to come from somewhere. The government can only “buy up assets from the private sector” if the government has surplus wealth to begin with. That’s why it’s called a “sovereign wealth fund.”
If you fund the purchases by raising taxes, that’s tantamount to simply seizing the assets – which might not bother Myerson. The moral argument, that nationalization is theft, might not be persuasive. The practical argument is that you can only do it once. Once you have seized all the railroads and factories, all the buildings and airplanes – no one will ever again have the ability to create new capital assets.
Will the government make ongoing capital investments out of those dividends, which it has pledged to the “universal national income?” Here, we must resort to history. Governments are notoriously poor investors. The experience of Russia, Cuba, China (before Deng) and Venezuela, has been that assets become steadily less productive from the time they are nationalized, and eventually become worthless.
The ideal of “everybody owns everything” rapidly becomes “everybody owns nothing.” Oh, except for the government. The process of confiscating the nation’s wealth might just – maybe – cause the government to become an all-powerful police state. History again. Myerson will be living in Harry Reid’s penthouse atop the Ritz, and you will be standing in the rain with your “universal national income” ration card.
So, the old folks do a bad job of explaining our mistrust of socialism. On the flip side, the young commentators show an astonishing arrogance about history. They say, in so many words, “we don’t care what happened in the twentieth century,” and, “it’s our country now.”
Indeed it is. If you want Myerson’s collectivist utopia, help yourself. It will take ten or twenty years to deplete America’s capital stock. Jeremiah will be dead and buried, and you kids will be just waking up to how totally screwed you are.
Image Credit: The People’s Cube