Given the strong historical association of socialism (state ownership of the means of production) with central planning, I think you are using the term incorrectly. The central planning that was synonymous with socialism was far more ambitious than state measures to correct market failures under capitalism. There really isn’t anything government does today that attains the level of “central planning”. Even central planning under the USSR was a propaganda ploy because central planning is impossible. The USSR was state capitalism—it had money, wages, prices, profits, etc. These things were supposed to be abolished under socialism (as was done during War Communism, which was abandoned due its catastrophic failure). Also, given the propensity of government failure it seem unreasonable to demand that rich folks pay high taxes for dubious redistribution programs (aka wasteful capital consumption). That’s like being forced to invest with a shady financial guru. Liberty should have priority over government coercion given that markets promote greater prosperity.
Great discussion. One way I think about the reason that socialism fails is that it doesn’t accept the fact that life is a series of questions/problems that human beings solve/manage, and that these problems/questions don’t stop. There is no end of history. Wealth and its inequality is a product of many humans either alone or together solving problems that arise from either old solutions that may create new problems (such as pollution) or from entirely new people we never foresaw. The liberty of markets allows innovation.
In addition, socialism forces individuals to see wealth as the only meaningful metric to judge humans— we are only equal when our wealth is equal. In a free market society I am free to find meaning in many different markets ; in a socialist economy I am tied to the political system.
i think that's exactly right. Much of this comes from viewing capitalism as the thing that produces "stuff" instead of viewing markets as just a mechanism for people to solve problems that they most want solved.
1) I think there probably needs to be a definition of socialism that we can all agree on.
There's the basic definition of "public ownership of the means of production" and then there's the debate what "public ownership means" - worker co-ops or the government and "means of production" - enterprise or government agencies or institutions.
Based on these different definitions you can make all sorts of definition of socialism.
Some people define socialism as "government ownership of enterprise".
Some people define socialism as "the government performing any goods or service"
Some people define socialism as "worker ownership of the enterprise"
While capitalism is always defined as private enterprise with private property and prices are usually determined by markets.
Based on definition 1 - Norway is pretty socialist with its oil state owned investment fund and has a lot of state ownership of enterprise. Norway owns 76% of the country's assets:
But Denmark, Finland, and Sweden are no where near as socialist, and based on their state ownership % of assets, they would all be capitalist countries.
Based on definition 2 - every country has socialism the question is how much, and this guy is obviously saying the government should do more. If we measured this by government spending as a % of GDP then countries like France, Italy, Finland, Austria, Belgium, and Greece are socialist since their state expenditure are over 50%, while Sweden, Norway, and Denmark would be capitalist since their expenditure is under 50%.
Based on definition 3 - no country except the destroyed Yugoslavia is forcefully based on worker-coops.
I think whenever someone talks about socialism, they need to reveal which definition they are conceding to (state ownership of enterprise vs. government spending vs. worker owned co-ops).
Thanks, Yaw, good point. I think we were implicitly operating on the definition of communism as government owning the means of production and of socialism as being about hitting some critical level of redistribution
This was a great discussion from a utilitarian perspective, but at the end I think you undervalue the simple deontological "moral overlearning" (https://www.econlib.org/archives/2013/08/libertarianism_3.html) case against socialism, which is that you ought to leave people alone and not mess with their stuff.
I agree with you that free will probably isn't real, and even if it is, being born with a high IQ and high conscientiousness enabled you to work hard, etc., so the notion of "deserves" might not make sense. But "deserves" does not even enter the picture here. If I receive a gift, I don't "deserve" it, but it is mine, and you wouldn't (shouldn't!) snatch it from me even if you know for sure there is someone for whom that gift would have higher marginal utility.
I am 90% libertarian and 10% utilitarian, so by this logic I think central planning and redistribution are presumptively wrong, except for like extreme negative externalities and market failures and preventing mass starvation. But otherwise let Bezos have his solid gold house and rocket car!
I also agree with you that the "deserves" case is more appealing to me as I get older. It comes from more of a place of "all of you are awful, leave me and my loved alones and we wont ask anything of you"
Thanks, Loren! I think we largely agree but I’d say I’m more like 60% utilitarian and 40% libertarian, or something like that. And, I think that, just like with criminal punishment, the utilitarian case regarding incentives tends to overlap very closely with the libertarian case anyways
Also, take this for what it’s worth, but I can’t help but feel like relationship dynamics come into play a bit in shaping your dialogue. Vaish has some good ideas and it’s only fair that he gets to present them in their completeness, rather than Regan objecting immediately at every subpoint...
Re: central planning, Regan says she’s anti-“central planning” while coming across as pro-planning by some (presumably) decentralized planner. Markets are the true decentralized planner! They’re where we collectively put our money where our mouth is. The so-called “invisible hand” is not a benevolent actor but a manifestation of the good-will we inherently have for our fellow humans.
To embrace socialism is to choose “the way things appear to be” or “the claims politicians sell for a living” over the way things *actually are.* Markets have a tendency to reflect things the way they actually are, and when they eventually/inevitably become distorted, we have more capacity to effectively respond with our daily-spent dollars than with our once-every-four-years, mostly symbolic vote.
At the core is your faith (or lack thereof) in your fellow man. That fundamental premise doesn’t change between capitalism and socialism, so if you think humans are fundamentally bad and/or misguided, you’re shit outta luck either way. But the truly relevant difference is the effectiveness of our feedback mechanism as common people. That’s the real reason markets are worth defending.
Interesting to hear I come across as not believing in the market because that’s not the case… I believe I say in the pod that I support cash redistribution to the poor, and the reason I prefer cash redistribution is because I value the market. Also it seems like you think Vaish and I have different views but I’m not sure we do. What difference did you take away from listening?
I believe you when you say you believe in the market. The problem is that “market failure” is overshadowed by government failure by miles. It’s very difficult to restrain government and maintain Goldilocks proportions (whatever that might look like). Of course, it’s also very difficult to advance to free market anarchy, but it’s better to argue for what will work rather than what won’t.
Given the strong historical association of socialism (state ownership of the means of production) with central planning, I think you are using the term incorrectly. The central planning that was synonymous with socialism was far more ambitious than state measures to correct market failures under capitalism. There really isn’t anything government does today that attains the level of “central planning”. Even central planning under the USSR was a propaganda ploy because central planning is impossible. The USSR was state capitalism—it had money, wages, prices, profits, etc. These things were supposed to be abolished under socialism (as was done during War Communism, which was abandoned due its catastrophic failure). Also, given the propensity of government failure it seem unreasonable to demand that rich folks pay high taxes for dubious redistribution programs (aka wasteful capital consumption). That’s like being forced to invest with a shady financial guru. Liberty should have priority over government coercion given that markets promote greater prosperity.
Great discussion. One way I think about the reason that socialism fails is that it doesn’t accept the fact that life is a series of questions/problems that human beings solve/manage, and that these problems/questions don’t stop. There is no end of history. Wealth and its inequality is a product of many humans either alone or together solving problems that arise from either old solutions that may create new problems (such as pollution) or from entirely new people we never foresaw. The liberty of markets allows innovation.
In addition, socialism forces individuals to see wealth as the only meaningful metric to judge humans— we are only equal when our wealth is equal. In a free market society I am free to find meaning in many different markets ; in a socialist economy I am tied to the political system.
i think that's exactly right. Much of this comes from viewing capitalism as the thing that produces "stuff" instead of viewing markets as just a mechanism for people to solve problems that they most want solved.
Great discussion, especially on redistribution.
1) I think there probably needs to be a definition of socialism that we can all agree on.
There's the basic definition of "public ownership of the means of production" and then there's the debate what "public ownership means" - worker co-ops or the government and "means of production" - enterprise or government agencies or institutions.
Based on these different definitions you can make all sorts of definition of socialism.
Some people define socialism as "government ownership of enterprise".
Some people define socialism as "the government performing any goods or service"
Some people define socialism as "worker ownership of the enterprise"
While capitalism is always defined as private enterprise with private property and prices are usually determined by markets.
Based on definition 1 - Norway is pretty socialist with its oil state owned investment fund and has a lot of state ownership of enterprise. Norway owns 76% of the country's assets:
https://www.peoplespolicyproject.org/2018/03/14/the-state-owns-76-of-norways-non-home-wealth/
But Denmark, Finland, and Sweden are no where near as socialist, and based on their state ownership % of assets, they would all be capitalist countries.
Based on definition 2 - every country has socialism the question is how much, and this guy is obviously saying the government should do more. If we measured this by government spending as a % of GDP then countries like France, Italy, Finland, Austria, Belgium, and Greece are socialist since their state expenditure are over 50%, while Sweden, Norway, and Denmark would be capitalist since their expenditure is under 50%.
https://en.wikipedia.org/wiki/List_of_countries_by_government_spending_as_percentage_of_GDP
Based on definition 3 - no country except the destroyed Yugoslavia is forcefully based on worker-coops.
I think whenever someone talks about socialism, they need to reveal which definition they are conceding to (state ownership of enterprise vs. government spending vs. worker owned co-ops).
Thanks, Yaw, good point. I think we were implicitly operating on the definition of communism as government owning the means of production and of socialism as being about hitting some critical level of redistribution
This was a great discussion from a utilitarian perspective, but at the end I think you undervalue the simple deontological "moral overlearning" (https://www.econlib.org/archives/2013/08/libertarianism_3.html) case against socialism, which is that you ought to leave people alone and not mess with their stuff.
I agree with you that free will probably isn't real, and even if it is, being born with a high IQ and high conscientiousness enabled you to work hard, etc., so the notion of "deserves" might not make sense. But "deserves" does not even enter the picture here. If I receive a gift, I don't "deserve" it, but it is mine, and you wouldn't (shouldn't!) snatch it from me even if you know for sure there is someone for whom that gift would have higher marginal utility.
I am 90% libertarian and 10% utilitarian, so by this logic I think central planning and redistribution are presumptively wrong, except for like extreme negative externalities and market failures and preventing mass starvation. But otherwise let Bezos have his solid gold house and rocket car!
I also agree with you that the "deserves" case is more appealing to me as I get older. It comes from more of a place of "all of you are awful, leave me and my loved alones and we wont ask anything of you"
Classic “utilitarian gf, curmudgeonly but ultimately prosocial bf” type couple.
Thanks, Loren! I think we largely agree but I’d say I’m more like 60% utilitarian and 40% libertarian, or something like that. And, I think that, just like with criminal punishment, the utilitarian case regarding incentives tends to overlap very closely with the libertarian case anyways
Also, take this for what it’s worth, but I can’t help but feel like relationship dynamics come into play a bit in shaping your dialogue. Vaish has some good ideas and it’s only fair that he gets to present them in their completeness, rather than Regan objecting immediately at every subpoint...
Appreciate the substantive engagement but I’m sure you’ll understand if we don’t take relationship advice from anonymous accounts too seriously
Sorry guys I have a tendency to get drunk and run my mouth too much. Please disregard, I’m trying to do better. Appreciate the content :)
The revolution will not blog-atised!
Re: central planning, Regan says she’s anti-“central planning” while coming across as pro-planning by some (presumably) decentralized planner. Markets are the true decentralized planner! They’re where we collectively put our money where our mouth is. The so-called “invisible hand” is not a benevolent actor but a manifestation of the good-will we inherently have for our fellow humans.
To embrace socialism is to choose “the way things appear to be” or “the claims politicians sell for a living” over the way things *actually are.* Markets have a tendency to reflect things the way they actually are, and when they eventually/inevitably become distorted, we have more capacity to effectively respond with our daily-spent dollars than with our once-every-four-years, mostly symbolic vote.
At the core is your faith (or lack thereof) in your fellow man. That fundamental premise doesn’t change between capitalism and socialism, so if you think humans are fundamentally bad and/or misguided, you’re shit outta luck either way. But the truly relevant difference is the effectiveness of our feedback mechanism as common people. That’s the real reason markets are worth defending.
Interesting to hear I come across as not believing in the market because that’s not the case… I believe I say in the pod that I support cash redistribution to the poor, and the reason I prefer cash redistribution is because I value the market. Also it seems like you think Vaish and I have different views but I’m not sure we do. What difference did you take away from listening?
I believe you when you say you believe in the market. The problem is that “market failure” is overshadowed by government failure by miles. It’s very difficult to restrain government and maintain Goldilocks proportions (whatever that might look like). Of course, it’s also very difficult to advance to free market anarchy, but it’s better to argue for what will work rather than what won’t.