The Fallacies of Redistribution and Socialism — Confirmed by Those Who Have Lived It

| October 7 2012
David Leeper

Despite the clear historical record of failure and misery, millions still aspire to the false promises of redistributionism and socialism.  Why?

As a social goal and political philosophy, redistribution (aka “spread the wealth around”) sounds really good — at first.  It sounds like caring, sharing, and fairness.  And those are all good things.  If it’s “done right” by the “right people”, shared prosperity through redistribution of wealth should work, no?

Well, when it comes to incisive, compelling, plain-language explanations, few can match Thomas Sowell, a one-time student of Milton Friedman and now a Senior Fellow at the Hoover Institution, Stanford University.  As Sowell explains in National Review (emphasis added):

Those who talk glibly about redistribution often act as if people are just inert objects that can be placed here and there, like pieces on a chess board, to carry out some grand design. But if human beings have their own responses to government policies, then we cannot blithely assume that government policies will have the effect intended.

The history of the 20th century is full of examples of countries that set out to redistribute wealth and ended up redistributing poverty. The Communist nations were a classic example, but by no means the only example.

In theory, confiscating the wealth of the more successful people ought to make the rest of the society more prosperous. But when the Soviet Union confiscated the wealth of successful farmers, food became scarce. As many people died of starvation under Stalin in the 1930s as died in Hitler’s Holocaust in the 1940s.

Sowell certainly has major-league credibility because he has studied economic/political theory for decades.  But then, so have committed Leftist intellectuals like Paul Krugman who take the opposite side.

So who’s right?

Neither of these intellectuals can testify directly.  Neither has actually lived under redistributionist political systems like socialism and communism.  But fortunately for us, right in our midst, are Americans who do have first-hand experience.

Led by reporter Brad Zinn, WesternFreePress.com has run a series of articles called “So What’s Wrong with Socialism?”. The articles include six interviews with survivors of redistributionism, socialism, and communism.  These naturalized Americans all want very much for native-born Americans to know and appreciate what we have in America, lest we lose it to ignorance and indifference.  Their words are heartfelt and well worth hearing.  The links to these interviews appear below.

  1. Zina Brodovsky, native of the Soviet Ukraine
  2. Jose Borrajero, native of Cuba
  3. Gabor Kovacs, native of communist Hungary
  4. Daniel Paul, native of the Polish Ukraine
  5. Caecilia Winnubst, native of Nazi-occupied Holland
  6. Sophie Katz, native of the Soviet Union

So what went wrong with these redistributionist-based systems that seemed so right at their beginning?

As Sowell says:

It is not complicated. You can confiscate only the wealth that exists at a given moment. You cannot confiscate future wealth — and that future wealth is less likely to be produced when people see that it is going to be confiscated. Farmers in the Soviet Union cut back on how much time and effort they invested in growing their crops when they realized that the government was going to take a big part of the harvest. They slaughtered and ate young farm animals that they would normally have kept tending and feeding while raising them to maturity.

To hear this story from a USSR survivor, in addition to her interview above, see the video and transcript of Zina Brodovsky’s presentation titled “Do You See What I See?” at this link.

Fortunately, free-market-based democracies do have some natural resistance to the siren song of redistributionism.  Says Sowell:

If confiscatory policies can produce counterproductive repercussions in a dictatorship, they are even harder to carry out in a democracy. A dictatorship can suddenly swoop down and grab whatever it wants. But a democracy must first have public discussions and debates. Those who are targeted for confiscation can see the handwriting on the wall, and act accordingly.

Our Constitution provides some implicit resistance to redistributionism because it was explicitly written to protect individual rights and private property from government.  Other constitutions, like those in Europe and South Africa, have had redistribution purposely embedded in them from the start.  They declare things like food, shelter, and health care as basic human rights to be guaranteed by government.  If America’s progressives could re-write our founding documents, they would surely do likewise.  And, incredibly, one of our own Supreme Court justices has denigrated our Constitution for its lack of redistributionism.

Despite the US Constitution’s restraints, our Big Government politicians from both parties have nonetheless found a way to confiscate wealth, albeit more subtly than did the USSR.  Namely, they borrow it and pass the debt on to future generations.  Our country is currently borrowing more than $4,000,000,000 per day and signing up our children and grandchildren to pay it back without their knowledge, let alone their permission.  This is a modern-day version of medieval debt bondage, except that in the medieval version, parents who sold their children into debt bondage at least did it knowingly.  Today, most seniors have no idea what they’re doing to their children and grandchildren.  Shame on those multi-term Congressmen from both parties who let this happen on their watch, didn’t warn us, and did nothing to impede it.

But I digress.  Sowell continues:

Among the most valuable assets in any nation are the knowledge, skills, and productive experience that economists call “human capital.” When successful people with much human capital leave the country, either voluntarily or because of hostile governments or hostile mobs whipped up by demagogues exploiting envy, lasting damage can be done to the economy they leave behind.

We have a prime example of this phenomenon close by, in Cuba, as attested to by Jose Borrajero in his interview on WesternFreePress.com.

As Sowell puts it:

Fidel Castro’s confiscatory policies drove successful Cubans to flee to Florida, often leaving much of their physical wealth behind. But poverty-stricken refugees rose to prosperity again in Florida, while the wealth they left behind in Cuba did not prevent the people there from being poverty-stricken under Castro. The lasting wealth the refugees took with them was their human capital.

We have all heard the old saying that giving a man a fish feeds him only for a day, while teaching him to fish feeds him for a lifetime. Redistributionists give him a fish and leave him dependent on the government for more fish in the future.

If the redistributionists were serious, what they would want to distribute is the ability to fish, or to be productive in other ways. Knowledge is one of the few things that can be distributed to people without reducing the amount held by others.

That would better serve the interests of the poor, but it would not serve the interests of politicians who want to exercise power, and to get the votes of people who are dependent on them.

Does any of this sound familiar?  Do we have politicians who cultivate dependence on government to win votes and strengthen their hold on power?  Do we have politicians who sell tax preferences and carve-outs to their private-sector cronies in return for campaign contributions?

As we slide toward redistributionism ourselves, to what country will the world’s refugees flee?  Is this one reason why the advocates of “one world government” pursue their objective — so that there will be no country to escape to?

Close on the heels of economic failure, redistributionist systems have repeatedly morphed into dictatorial socialistic regimes that last for decades.  Some of these dictatorships have been handed down through family dynasties like the one in North Korea, or in a series of winner-take-all political coups like those in the Soviet Union and China.  Starvation has often followed, unless and until at least some form of political and economic freedom returns.

As Gabor Kovacs says in his interview, the tolerance of Hungarian communists for some small private enterprises, and for the Catholic religion, made Hungary one of the more successful communist countries during the era of the USSR.  And in the USSR itself, the 3-4% of private farm land permitted by law at one time produced 25-35% of all agricultural produce.

And much closer to home, see also this link for the Plymouth Rock story of the Pilgrims and their hoped-for socialist utopia in America. They nearly starved to death before switching abruptly to a private-property / free-market economy that brought them prosperity instead of starvation.  The Pilgrims learned, painfully, that even the most idealistic of peoples have no reason to put in any extra effort without the motivation of personal incentives to do so.

It is amazing that despite the long dismal record of redistributionism and socialism, those systems still attract so many aspirants.  As Sowell puts it:

Barack Obama can endlessly proclaim his slogan of “Forward,” but what he is proposing is going backwards to policies that have failed repeatedly in countries around the world.

Yet, to many people who cannot be bothered to stop and think, redistribution [still] sounds good.

In the WesternFreePress.com interviews (links above) the survivors of redistributionism and socialism confirm that America is on its way to making the same mistakes that were made in their native countries.  Let’s all hear and heed their warning.  This upcoming election may be our last clear chance to reverse the process and turn away from the abyss.

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Socialism in general has a record of failure so blatant that only an intellectual could ignore or evade it.

Much of the social history of the Western world, over the past three decades, has been a history of replacing what worked with what sounded good.

Thomas Sowell