The Sad Road to Socialism

This week the focus will be on the effects of governmental power that continually grows. If unchecked, the government eventually becomes so big that it consumes itself. To illustrate this, I will share an article published on July 23, 2008 by John Loeffler. John is a 40-year broadcast news veteran and host of the nationally syndicated talk show on the IRN/USA Radio Network, Steel on Steel (www.steelonsteel.com) and co-host of The Financial Sense Newshour (www.financialsense.com).

Here is Part I of John's article titled "The Sad Road to Socialism - What happens When Private Property is No Longer a Right".

“But if the government undertakes to control and to raise wages, and cannot do it; if the government undertakes to care for all who may be in want, and cannot do it; if the government undertakes to support all unemployed workers, and cannot do it; if the government undertakes to lend interest-free money to all borrowers, and cannot do it; if .... ‘The state considers that its purpose is to enlighten, to develop, to enlarge, to strengthen, to spiritualize, and to sanctify the soul of the people’ -- and if the government cannot do all of these things, what then? Is it not certain that after every government failure -- which, alas! is more than probable -- there will be an equally inevitable revolution?”

-Frederic Bastiat, “The Law,” June, 1850

It’s been more than 150 years since Frederic Bastiat wrote his treatise, The Law, a small work, challenging the ravages of failing socialism thrust upon France as a result of the French revolution.

In that unique pamphlet, Bastiat points out that when the law of any country supports the moral belief systems of a people, defends the rights of said people and their property, the law is perceived as being moral; a defense against evil and those who flaunt it as being immoral. Payment of taxes and civic obligations are perceived as a virtue and those who flout this as criminals.

However, when the law becomes a source of plunder or pits itself in opposition to the morals of the people, the people perceive the law to be immoral and widely despise it. Indeed, in those times, flouting the law is extolled as virtue.

Another book by contemporary author Hernando Desoto, The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else, points out much the same thing, that the security of ownership of private property guaranteed by law for the lower and middle classes has been the essential ingredient resulting in the prosperity enjoyed by many western countries. Without this security, where the state becomes an impediment to commerce or property ownership, the people are forced to operate their economies outside of law, which is once again perceived as evil, rather than a force for good.

In essence, when a government goes from being a protector of private property to a plunderer of it, it places itself on a course of chaos, economic ruin and its own ultimate self-destruction.

The Three Steps of Socialism

Socialism is the mechanism which transforms government from its noble role as a protector into a predator and, since the citizens of our fine country seem determined to plow through socialism to its bitter end, we should examine the territory through which these three sad steps lead. The core result of socialism is the destruction of private property and wealth.

The events described in this piece are a composite of the ravages of socialism experienced in other countries. While each country does experience all the events portrayed, all socialist countries follow the same miserable path. The U.S. doesn’t have to go down this path, but it seems determines to do so.

We’re Off to See the Wizard

One of the great dangers of any government by the people is that sooner or later their politicians discover they can vote largess from the public trust. Their first experiment at this bold new adventure invariably revolves around social programs enacted in the name of morality and the public good or even solving some current crisis. Who could oppose that? “After all,” it will be argued, “don’t you care about people, or the welfare of the country, or the environment?”

The lure of this argument has been absolutely irresistible from the Roman Empire to the French and Bolshevik revolutions to Socialist Parties (D) and (R) in the USA today.

Step One - The Moral Argument: A Promise of Something for Nothing

The moral argument that we can finally solve poverty, pain, sickness, and hunger with “free” money seems just to good to be true. It usually is but it sells to the public. To fund these allegedly moral programs, the assets of the gentle citizens must be quietly taxed in the name of the public good.

Only a few wise and isolated voices warn that this baby dragon they have just hatched will grow up to be a fire-breathing monster. But not to fear, the wise voices are generally shouted down by the gentle politicians, who fiercely demonize protestors as selfish “whabbledygots” blocking the road to the perfect society. After all, how could something so noble do anything bad to the country?

At first the rich are the only ones asked to pay more of their “fair share.” In the U.S. income tax originally only affected upper-bracket individuals. In this early stage, few complain and everyone seems happy, except for those nagging voices still warning of dire consequences ahead; the ones the gentle legislators wish would just shut up. Other than that they have little to fear because the gentle legislators appear to be heroes placing our feet firmly on the road to utopia. Soon they promise all the have-nots will have and those who do have, will have just a little less. After all, as we said, it’s just their “fair share.”

Ah but time rumbles onward, and the number of people dependent upon these programs swells along with the number of “free” government programs. Free things do sell, and that’s what politicians want to do: sell their programs.

As the programs swell, they become unwieldy, requiring large bloated bureaucracies to administer them to ward off the inevitable fraud and corruption, consuming an ever greater part of the tax booty and servicing less to the originally intended recipients. In order to control the chaos of a large group of people cueing up to get something for nothing, large volumes of laws and regulations have to be written to control who gets what and where and when and who the givers and who the takers are. Now, the bureaucrats who administer these programs are also dependent on them for their livelihoods. This entrenches the program and assures its progression to Stage Two.

Tomorrow, we will continue on with John's article and why the promise of something for nothing never seems to work out. Stay tuned ...

When I heard their outcry and these charges, I was very angry. I pondered them in my mind and then accused the nobles and officials. I told them, "You are exacting usury from your own countrymen!" So I called together a large meeting to deal with them and said: "As far as possible, we have bought back our Jewish brothers who were sold to the Gentiles. Now you are selling your brothers, only for them to be sold back to us!" They kept quiet, because they could find nothing to say.

So I continued, "What you are doing is not right. Shouldn't you walk in the fear of our God to avoid the reproach of our Gentile enemies? I and my brothers and my men are also lending the people money and grain. But let the exacting of usury stop! Give back to them immediately their fields, vineyards, olive groves and houses, and also the usury you are charging them—the hundredth part of the money, grain, new wine and oil."

"We will give it back," they said. "And we will not demand anything more from them. We will do as you say."

Then I summoned the priests and made the nobles and officials take an oath to do what they had promised. I also shook out the folds of my robe and said, "In this way may God shake out of his house and possessions every man who does not keep this promise. So may such a man be shaken out and emptied!"

At this the whole assembly said, "Amen," and praised the LORD. And the people did as they had promised. Nehemiah 5:6-13 (NIV)

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Email: DeltaInspire@panama-vo.com