Komrade Karl and the Glorious Fairy Tale of Socialism

Warning – this is a long post. There is really no need for me to try to improve on conclusions drawn by men who are far more intelligent than me – men like Ludwig von Mises, Friedrich Hayek, Hans-Hermann Hoppe and John Kenneth Galbraith.

So I’ll just quote them…

I have been having this running debate with Komrade Karl here about why socialism/collectivism is a bad idea for America. He has raised the same mythical 99% issue as the old and busted Occupy (bowel) “movement” did, that being, in Karl’s vernacular (the spelling and punctuation is his):

what is so democratic about a working class man making 10 dollars an hour, having less than a hundredth of the “voting” power of a millionaire? is the voice of 99 working men less than that of one bourgeoisie. Socialist advocate for true democracy. you accuse socialism of “arbitrary” authority, I ask you what is more arbitrary, workers choosing their leaders through worker’s organizations, or workers working for whichever group of millionaires performed best in stock trades and had social connections to previous management.

Setting aside the apparent fact that they don’t cover language arts and writing at the Vladimir Ilyich Lenin Primary School, income “inequality” seems to be the modern progressive/socialist/Marxist/communist’s rallying cry…but is a socialist/centrally planned society really the way to achieve such “equality”?

History says that Komrade Karl is up in the night and therefore – quite wrong.

Almost 100 years ago – in 1922, Ludwig Von Mises studied socialism in its nascent form, resulting in his publishing of a book titled: Socialism: An Economic and Sociological Analysis.

He pointed out that the principle issue of a socialist is how to divvy up the outcome of an economy/society:

On logical grounds, treatment of the problem of income should properly come at the end of any investigation into the life of the socialist community. Production must take place before distribution is possible, therefore, logically, the former should be discussed before the latter. But the problem of distribution is so prominent a feature of Socialism as to suggest the earliest possible discussion of the question. For fundamentally, Socialism is nothing but a theory of “just” distribution; the socialist movement is nothing but an attempt to achieve this ideal. All socialist schemes start from the problem of distribution and all come back to it. For Socialism the problem of distribution is the economic problem.

Socialists do not advocate for true democracy, they advocate for redistribution. Komrade Karl seems to think that the distribution problem is solved and even takes issue with my use of the term “arbitrary” with respect to distribution of output – von Mises addressed why this is an accurate term – in 1922 (I didn’t just make it up). Economist F.A. Hayek also noted this in his 1944 book, The Road to Serfdom, as the “Who, whom” dilemma – that is to say, who plans for whom, who decides for whom and so on and so forth.

My guess (based on Karl’s expressed points) is that he has a populist (and therefore superficial) understanding of socialism. He defends it because it sounds “fair” and therefore it must be good – who cares if it really works, right?

Ludwig von Mises did. He writes:

The socialist community is characterized by the fact that in it there is no connection between production and distribution. The magnitude of the share which is assigned for the use of each citizen is quite independent of the value of the service he renders. It would be fundamentally impossible to base distribution on the imputation of value because it is an essential feature of socialistic methods of production that the shares of the different factors of production in the result cannot be ascertained; and any arithmetical test of the relations between effort and result is impossible.

It would therefore not be possible to base even a part of distribution on an economic calculation of the contribution of the different factors, e.g. by first granting the worker the full product of his labour which under the capitalist system he would receive in the form of wages, and then applying a special form of distribution in the case of the shares which are attributed to the material factors of production and to the work of the entrepreneur. On the whole socialists lack any clear conception of this fact. But a faint suspicion of them pervades the Marxian doctrine that under Socialism the categories wages, profit, and rent would be unthinkable.

There are four different principles upon which socialistic distribution can conceivably be based: equal distribution per head, distribution according to service rendered to the community, distribution according to needs, and distribution according to merit. These principles can be combined in different ways.

The principle of equal distribution derives from the old doctrine of natural law of the equality of all human beings. Rigidly applied it would prove absurd. It would permit no distinction between adults and children, between the sick and the healthy, between the industrious and the lazy, or between good and bad. It could be applied only in combination with the other three principles of distribution. It would at least be necessary to take into account the principle of distribution according to needs, so that shares might be graded according to age, sex, health and special occupational needs; it would be necessary to take into account the principle of distribution according to services rendered, so that distinction could be made between industrious and less industrious, and between good and bad workers; and finally, some account would have to be taken of merit, so as to make reward or punishment effective. But even if the principle of equal distribution is modified in these ways the difficulties of socialistic distribution are not removed. In fact, these difficulties cannot be overcome at all.

We have already shown the difficulties raised by applying the principle of distribution according to value of services rendered. In the capitalist system the economic subject receives an income corresponding to the value of his contribution to the general process of production. Services are rewarded according to their value. It is precisely this arrangement which Socialism wishes to change and to replace by one under which the shares attributed to the material factors of production and to the entrepreneur would be so distributed that no property owner and no entrepreneur would have a standing fundamentally different from that of the rest of the community. But this involves a complete divorce of distribution from economic imputation of value. It has nothing to do with the value of the individual’s service to the community. It could be brought into external relation with the service rendered only if the service of the individual were made the basis of distribution according to some external criteria. The most obvious criterion appears to be the number of hours worked. But the significance to the social dividend of any service rendered is not to be measured by the length of working time. For, in the first place, the value of the service differs according to its use in the economic scheme. The results will differ according to whether the service is used in the right place, that is to say, where it is most urgently required, or in the wrong place. In the socialist organization, however, the worker cannot be made ultimately responsible for this, but only those who assign him the work. Secondly, the value of the service varies according to the quality of the work and according to the particular capability of the worker; it varies according to his strength and his zeal. It is not difficult to find ethical reasons for equal payments to workers of unequal capabilities. Talent and genius are the gifts of God, and the individual is not responsible for them, as is often said. But this does not solve the problem whether it is expedient or practicable to pay all hours of labour the same price.

The third principle of distribution is according to needs. The formula of each according to his needs is an old slogan of the unsophisticated communist. It is occasionally backed up by referring to the fact that the Early Christians shared all goods in common. Others again regard it as practicable because it is supposed to form the basis of distribution within the family. No doubt it could be made universal if the disposition of the mother, who hungers gladly rather than that her children should go without, could be made universal. The advocates of the principle of distribution according to needs overlook this. They overlook much more besides. They overlook the fact that so long as any kind of economic effort is necessary only a part of our needs can be satisfied, and a part must remain unsatisfied. The principle of “to each according to his needs” remains meaningless so long as it is not defined to what extent each individual is allowed to satisfy his needs. The formula is illusory since everyone has to forgo the complete satisfaction of all his needs. It could indeed be applied within narrow limits. The sick and suffering can be assigned special medicine, care, and attendance, better attention and special treatment for their special needs, without making this consideration for exceptional cases the general rule.

Similarly it is quite impossible to make the merit of the individual the general principle of distribution. Who is to decide on merits? Those in power have often had very strange views on the merits or demerits of their contemporaries. And the voice of the people is not the voice of God. Who would the people choose today as the best of their contemporaries? It is not unlikely that the choice would fall on a film star, or perhaps on a prize-fighter. Today the English people would probably be inclined to call Shakespeare the greatest Englishman. Would his contemporaries have done so? And how would they esteem a second Shakespeare if he were among them today? Moreover, why should those be penalized in whose lap Nature has not placed the great gifts of talent and genius? Distribution according to the merits of the individual would open the door wide to mere caprice and leave the individual defenseless before the oppression of the majority. Conditions would be created which would make life unbearable.

As far as the economics of the problem are concerned it is a matter of indifference which principle or which combination of different people is made a basis for distribution. Whatever principle is adopted the fact remains that each individual will receive an allocation from the community. The citizen will receive a bundle of claims which can be exchanged within a certain time for a definite amount of different goods. In this way he will procure his daily meals, fixed shelter, occasional pleasures, and from time to time new clothing. Whether the satisfaction of needs which he obtains in this way is great or small will depend upon the productivity of the efforts of the community.

So it is clear that from Von Mises viewpoint, the distribution of any societal outputs is, most certainly, arbitrary and disassociated from true “fairness” in any form. Both he and the noted anarcho-capitalist economist, Hans-Hermann Hoppe realized that while socialism promises efficiency, at a macro level it actually delivers a sub-optimal result. Hoppe states that countries where the means of production are socialized are not as prosperous as those where the means of production are under private control and Ole Ludwig argued that aiming for more equal incomes through state intervention necessarily leads to a reduction in national income and therefore a corresponding reduction in average income. Consequently, the socialist chooses a more equal distribution of income, on the assumption that the marginal utility of income to a poor person is greater than that to a rich person. According to von Mises, this mandates a preference for a lower average income over inequality of income at a higher average income. So, basically, the socialist would rather that all incomes be precisely equal at a lower level than having a greater standard deviation of incomes at a much higher level – ergo the term “shared misery”.

The economist John Kenneth Galbraith (in The Good Society: The Humane Agenda) was highly critical of all forms of communal/collectivist forms of socialism that promote egalitarianism in terms of wages/compensation. He observed them as unrealistic in their assumptions about human motivation:

This hope [that egalitarian reward would lead to a higher level of motivation], one that spread far beyond Marx, has been shown by both history and human experience to be irrelevant. For better or worse, human beings do not rise to such heights. Generations of socialists and socially oriented leaders have learned this to their disappointment and more often to their sorrow. The basic fact is clear: the good society must accept men and women as they are.

Komrade Karl shares this blind spot with his fellow members of the proletariat.

While socialism fails economically, it is far more dangerous as it applies to society.

In 2013, we have the benefit of the real history of socialism, Marxism and communism over the subsequent 91 years since von Mises made the above observations and there is nothing in those years that would indicate that he was in error, actually it is quite the opposite. I would also point out that in 1944, Hayek argued that the road to socialism leads society to totalitarianism, and argued that fascism and Nazism were the inevitable outcome of socialist trends in Italy and Germany during the run up to WW II.

It would seem that we also have history to thank for the validation of Hayek’s conclusions as well.

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14 thoughts on “Komrade Karl and the Glorious Fairy Tale of Socialism

  1. “Socialists do not advocate for true democracy, they advocate for redistribution”

    the two are the same, you cannot claim that property does not equal power. the aim is not so much to redistribute property, but to turn private property into social property. Thus robbing individuals of excess power, and creating a true democracy.

    distribution of output is not an issue.
    1. the people decide their needs
    2. we produce to meet those needs
    3. we distribute the products to satisfy the needs

    Hayek and friends criticism of distribution in socialist systems applies more to capitalist systems, there are lazy worker’s who earn the same and sometimes more than more industrious workers who produce quality work. There are workers who are 5 foot 3 inches tall, who make the same amount as workers who are 6 foot 5 inches tall.

    • “Thus robbing individuals”

      Talk about criminal intent ….

      “distribution of output is not an issue.”

      It is when you “rob”. But then again, in the government you would form, of course it would only be an “issue” long enough to “issue” a bullet to the protester’s brain.

      F**cking totalitarian Marxist.

  2. When I was in college I traveled to Florida one summer and worked in a factory with a woman who escaped Cuba. Like many college kids at the time I flirted with the idea we should all be socialists, but after working with her and hearing about her life in Cuba I never said anything like that again. Knowing her was a lesson in what it really meant to live in a communist country and it wasn’t a pretty picture. I’d been on my own since I was 14, but this woman from Cuba had experienced true poverty and situations so precarious it probably would have broken me. I came away from that summer thanking God I’d been born in America.

    Karl, have you ever lived for any length of time in a communist country? Theory is one thing, but living in that kind of system might be very different than you imagine.

    • I have friends who lived under repressive rule in Yugoslavia, Checzlovokia, Romania and East Germany. They laugh at fools like our Komrade. They all risked life and limb to escape those worker’s pariadises.

      Utah chronicled his two years under the socialist programs in the UK. All of that proves the point that the American Republic and it’s freedoms are better in every way.

  3. Cuba is a great example.
    IF I thought socialism/communism was even worth consideration I would take a trip to Cuba. That warm tropical weather would feel great about now.
    So I have to ask myself why dosn’t karl take his own advice and take a short 90 mile trip south of florida where he could live in a paradise?
    The answer is simple.
    Cuba is a establish communist country. Therefore karl will be nothing more than ‘grease for the machine’. However he, and all his cohorts believe that to usher in such a system here they would be elevated to the class of the communist elite. Heroes of the cause! exhaulted in word and bronze for all posterity!
    sound familier?
    It should. it was the same motivation of Lee Harvey Oswald.
    As such, I submit to you their sanity would match as well.

  4. To put my money where my mouth is;
    In a few more years my son will have graduated college, and my mortgage will be paid. If the Free state project takes off, I will be moving to where the principals I expouse are praticed.

    How about you, karl?
    dare to practice what you preach? What could posibly holding you here, crisis of faith in the goodness of your chosen system of government?
    Inquiring minds want to know!

    • Yeah Karl. You have an Apple computer that I cannot afford. Let me just go get my closest armed government servant, and come “rob you” of your computer.

      Then you can be belly-ache about redistribution.

  5. Karl just doesn’t get human nature. In order to have a sound production base, the workers have to be paid on a meritorious basis, otherwise mediocrity ensues.

    As a matter of fact, as recently as a few years ago, before most of our textile manufacturing was sent over seas, people were paid “by the piece.” The more you produced, the more you got paid. ( with the caveat that the work passed inspection.)

    And why shouldn’t the people who put up the money for the factory and take the risk, expect not to receive some compensation for their risk and effort?

    And as has been shown in every socialist system to date, there are still going to be people who receive extra benefits above and beyond what the average worker receives. Karl is all for socialism, but he won’t like it so well when he finds he is just another peon.

    Under the free market/capitalist system, everybody has the opportunity to better their lives. It’s called equal opportunity…not equal outcome.

    • He get’s human nature. He just doesn’t like it because he’s not the one with wealth or power. Pure f**cking asinine jealousy from an utter moron.

  6. Socialist masters have a specific plan for keeping worker productivity high. Just watch Schindlers List and you will get your answer. If you don’t have time to watch it let me fill you in. It’s a bullet in the back of the head.

  7. Part of the problem that socialists have is the idea that stuff just poops out of the sky based on no effort by Evil Capitalist Overlords.

    Not so, Karl. While you’re out Occupying somewhere, raping people, pooping on cop cars and beating up food vendors that won’t let you take their food….we, the evil capitalists are working to keep our businesses afloat. Not 30 or 40 hours a week, but 80, 90,100 hours, taking out bank loans to pay our employees, who quite often have ZERO idea of what it takes to keep a business going. And they don’t care.

    So you’re willing, in the name of Fairness, Free Stuff, and Sticking it to the Rich (aka Makers), to turn over your liberty and mine to The Government. What makes you think, in your little socialist world, that some idiot government bureaucrat is any better at making stuff poop out of the sky than a hard working capitalist who has a vested interest in succeeding?

    Fucking idiots.

    • Are You SURE..????
      “Part of the problem that socialists have is the idea that stuff just poops out of the sky based on no effort by Evil Capitalist Overlords.”

      You mean people PAY for stuff ?….I keep seeing FedEx and UPS trucks coming to my neighbors dropping Sh-T off, I was thinging WTF……I thought maybe I was just last on the list or something !!…..I didn’t know you had to PAY for stuff.

      Where’s Karl when you need him.

  8. Where’s karl?
    Anybody check on him?
    Is he sick?
    I sure hope he isn’t getting socialized medical care,
    we may never see him again!

    • Now. He got his proverbial ass handed to him, and crawled back under his rock … as is usual with these crazy (censored) liberals.

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