People hate America’s big disparities in wealth. It’s a reason why, among young people, socialism is as popular as capitalism.
The Democratic Socialists of America want a country based on “freedom, equality and solidarity.” That sure sounds good.
But does socialism bring that?
My new video debunks several myths about socialism.
One reason for socialism’s continued appeal is linguist Noam Chomsky. For generations, his work has taught students that capitalism is “a grotesque catastrophe.”
I assumed the fall of the Soviet Union would put an end to such misinformation. It did — for about a month.
But since then, the lust for socialism has come back strong. Today, Chomsky says that the Soviet Union “was about as remote from socialism as you could imagine.”
“Absurd!” responds economist Ben Powell, author of “Socialism Sucks: Two Economists Drink Their Way Through the Unfree World.”
When the Soviets made private businesses illegal, says Powell, “that’s about as close as the world ever saw” to pure socialism.
Now that the Soviet Union is gone, MSNBC anchor Ali Velshi says, “there is no true socialist country that exists.”
No? What about Cuba, China, North Korea, Vietnam and Venezuela?
Velshi didn’t respond when we asked him.
Venezuela was once Latin America’s richest country. Now it’s the poorest. Many in the media claim that its fall has “nothing to do with socialism,” just “poor governance.”
John Oliver says, “Chavez’s programs could have been sustainable if he pursued a sound economic policy.”
“Yeah,” laughs Powell. “Sustainable if he had a sound economic policy called capitalism.”
I push back. “Why does it have to be capitalism?” Why not socialism without bad management?
“That’s the nature of socialism!” Powell replies. “Their economic policies fail to adjust to reality because economic reality evolves every day. It’s millions of decentralized entrepreneurs and consumers making fine-tuning adjustments.”
Powell notes that in our capitalist society, when COVID-19 hit, businesses quickly adjusted. Restaurants switched to takeout and delivery. They built outdoor patios with heat lamps. Supermarkets opened early so the elderly could shop with less risk. Alcohol companies started producing hand sanitizer. Ford used its 3D printers to make face masks.
The media whined about “lack of federal direction,” but no central authority could direct all those individual adjustments in thousands of different places. In fact, federal direction would have prevented it.
“In a socialist economy, you get a one-size-fits-all adjustment,” adds Powell. “You miss out on this learning process where entrepreneurs copy others when they see things successful and stop doing it when it’s not.” By contrast, “In a market economy, everybody’s little adjustments get tested, and we get to see what works.”
In America, Blockbuster video was a great success. But then Netflix offered something better — no driving to a store, no late fees. Because Blockbuster didn’t immediately adjust, it went bankrupt.
“In a socialist economy, every adjustment needs to be commanded,” says Powell. “Communicate it down and get everybody to do the right thing. That’s impossible.”
That’s why under socialism, shortages are routine. In Venezuela, there’s so little food for sale that Venezuelans have lost weight.
Yet, “journalists” at Vox produced a video titled, “The Collapse of Venezuela, Explained,” without mentioning socialism even once. Vox’s explanation for Venezuela’s fall: “Oil prices plummeted.”
“The oil price is a complete distraction,” says an exasperated Powell. “There’s plenty of countries that depend on oil revenue. When oil prices went down, people there didn’t start losing weight. That just happened in Venezuela.”
Some claim Venezuela and Cuba’s people struggle mainly because of America’s economic sanctions and embargo.
“They certainly don’t help the people,” says Powell, “but it’s an afterthought as a reason for their suffering.”
The U.S. only sanctioned a few Venezuelan officials and their operations — not the country as a whole.
In Cuba, Powell points out: “They drive around 1950s U.S. cars … but there’s no U.S. Navy destroyers prevent Kia, Fiat and whoever else around the world from sending them cars. The reason for their suffering is they have an economic system that can’t deliver.”
Socialism delivers misery.
Next week, three more myths about socialism.
Photo by Film is not dead. on Unsplash
John,
I’ve been watching you since I can even remember being the littlest baby. My parents would watch 20/20 every week… I believe it was Friday evenings, and I remember I always liked watching your segments, even though at the time, i wasn’t emotionally invested in those topics. I actually preferred it over Barbara Walters (no disrespect to her legendary status however). As the years gone by, I stopped watching the news for about 30 years but due to communication advancements through technology and innovation, your Facebook segments “Reasons” showed up on my feed (I’m 43 now). I’ll be honest, once I started watching your segments, it brought me back to my childhood. Glad to be watching your stuff again… its still as entertaining — but your common sense approach is fantastic. Not sure if you read these things but thanks for keeping us informed from the misinformation and challenging perspectives respectfully. Maybe one day I will walk by in a mall and see you sell Asian cupcakes again. I’ll buy one for a $.50…. because I’ll negotiate down from that $1.50 you’d be charging 🙂
Here is a big problem that’s causing the great divide, and if you factor for inflation the average worker has less buying power than in 1978 , way to much being put to the top instead of back into the company and to the workforce !!!!!!!
John, you nearly ALWAYS hit nails right on the head. Thanks. Now, if ONLY you could get the liberals to listen and think …
John,
I must say in all the garbage and finger pointing and so much mis-information given out by so many “journalists”. It is refreshing to have a person do good investigative journalism and try to allow the viewers and readers to make their own mind and own decisions about topics that truly affect so many. Please don’t loose this Sir!! And please keep up the quantity content.
John, I would love to see you do a weekly or monthly show “Hbo style” similar to what Bill Maher does as I think you are always entertaining and your perspective is spot on. Anything in the works for you?
Mr. Stossel,
Always appreciate watching your segments, even back from 20/20 days. Thanks for posting these articles for folks so that they’d be able to get more educated about current events. My parents brought us out from behind the iron curtain in 1986. We left an eastern bloc country for a better life in America. People outside of this country can only dream about the possibilities here. Yet sadly, now, many people want to turn this country into a place we left. We just pray for others to realize what they have here.
When I read your article, the hope in my heart which has almost been extinguished, returned. It’s a good feeling to know that there are journalist who still deal in truth, information and education. I am sick to death of the crap spewed by the MSM. How they can look their viewers in the eye and still put out the trash that they do is beyond me. My hope for the survival of America is alive. I sincerely appreciate you doing your research and investigations before reporting. Does any MSM reporter do that any more besides you? I thank you for realizing that I have a good brain and can decide what is the truth and what is simply publicity seeking nonsense. Looking forward to reading more of your work.
John
You are what is real journalism!!
Thanks
Mr Stossel,
Perhaps you’ve already done this. But can you explain why private medical care is so expensive and how free markets should be making this less cost prohibitive and if you have some examples where this works in a truly free market society?
sigh…..oh brother……don’t try it john. it’s like trying to explain “hash tag” to you grandma….impossible.
Or why all my Dually Canadian buddies and families come over the border for anything more than the flu. Nationalized anything is obscenely mismanaged and too expensive. Funny how military loses an average 200 milliin a year and its accepted. Do this once in private sector and see what occurs.