Posted by on 2 July, 2011 at 9:17 am. 37 comments already!

The Politics of Socialism – Obama’s Policies

This post is for Greg and all the other socialists who hang out here. I am anxious to see what references they come up with to refute this treatise. With a h/t to MataHarley.

As taxpayers forked over $700 billion to bail out Wall Street and $787 billion to “stimulate” the economy, questions are now being asked about Obama’s economic policies and whether he is leading us toward socialism. The proposed 2012 budget is expected to be about 40% of this country’s GDP, very similar to European socialist states. Government spending in the European Union nations averages 47.1 percent of the GDP, meaning the U.S. is roughly seven points behind. We are getting close. In a socialist state, the government owns the production, it owns the factories or the plants or the businesses. But that government spending runs counter to the idea of Jeffersonian democracy, that it’s the individual who knows best. “We are looking at an economic crisis caused by the collapse of our financial sector,” Heather Boushley said. “If we don’t get people back to work, the problem will spiral out of control.” Critics warn that’s exactly what happened in Europe when it implemented socialist reforms, forcing unemployment into the double digits.

Obama is pursuing a “stealth socialism” policy by advocating economic justice. “Economic justice” (social justice) simply means punishing the successful and redistributing their wealth by government fiat. It’s a euphemism for socialism. The closest we can get to a specific definition came when Obama said of the Warren Supreme Court (you know, the one that gave us the concept of criminal rights) in a 2001 radio interview, that the Warren Court hadn’t “ventured into the issues of redistribution of wealth and sort of more basic issues of political and economic justice in this society.”

Obama is driven by one thing above all: social justice. He believes that prosperous Americans have a moral obligation to help the deprived in the United States. The problem is that Obama does not really understand what drives poverty. Poverty’s deepest and most debilitating deficits are moral, not financial; the most serious deprivations are cultural, not economic. Many people living at the bottom of American society have cell phones, flat-screen TVs, and some of the other goodies of consumer culture. For Obama, social justice is all about money. And he is well on his way to bankrupting the nation in attempting to achieve it.

Why It’s the People’s Choice

There are four primary reasons why socialism is the people’s choice.

  1. Socialism allows people to spend other people’s money without feeling guilty about it. Socialists deny the concept of ownership, but even they know that they are using the fruits of others’ labors for their own purposes, desires, and decisions.
  2. Socialism satisfies the deeply felt and widely held emotion of envy. Envy is a strong emotion that has always had a powerful impact on society and politics. But because no one admits to acting on the basis of envy, the term “equality” is used instead. Socialism is the perfect political expression of envious people because it purports to rein in greedy and wealthy capitalists and foster social equality.
  3. Socialism relieves people of the burden of worrying about their economic well-being. Free-market capitalism emphasizes the individual’s responsibility for his own economic welfare. Many people are happy to be rid of this burden and glad to be able to blame others for their problems. They do not see the downside: laziness, profligacy, and passivity.
  4. Socialism is a secular substitute for religion and offers people (false) solace against the traumas of this life. Socialism acts as a religion-substitute. Socialism purports to offer a solution to virtually all human problems. In contrast, the claims of capitalism are seen as too modest, and hard work is required as well.

Economic View

Socialism is a Big Lie that always fails. While it promised prosperity, equality, and security, it delivered poverty, misery, and tyranny. Equality is achieved only in the sense that everyone was equal in his or her misery. In the same way that a Ponzi scheme or chain letter initially succeeds but eventually collapses, socialism may show early signs of success. But any accomplishments quickly fade as the fundamental deficiencies of central planning emerge. In the long run, socialism has always failed. Under socialism, incentives either play a minimal role or are ignored totally. A centrally planned economy without market prices or profits, where property is owned by the state, is a system without an effective incentive mechanism to direct economic activity. Without the incentives of market prices, profit-and-loss accounting, and well-defined property rights, socialist economies falter and fail.

The temptress of socialism is constantly luring us with the offer: “give up a little of your freedom and I will give you a little more security.” The offer is tempting but never works – we lose both our freedom and our security.

Academic Example

An economics professor at the University of Florida said he had never failed a single student, but had once failed an entire class. The class insisted that socialism worked, that it was a great equalizer. The professor then said, “OK, we will have an experiment in this class on socialism.” “All grades will be averaged and everyone will receive the same grade.” His three exams went thusly:

  1. After the first exam the grades were averaged and everyone got a B. The students who had studied hard were upset while the students who had studied very little were happy.
  2. After the second exam, the students who had studied little actually studied even less; and the students who had studied hard studied less. The second exam average grade was a D.
  3. After the third exam, the average grade was an F.

The scores never increased as bickering, blame, name calling, all resulted in hard feelings and no one would study for anyone else. To their great surprise all failed. The professor told them that socialism would ultimately fail because: the harder people try to succeed, the greater their reward (capitalism); but when a government takes all the reward away (socialism) no one will try nor succeed. Anyone who states Socialism helps those who can’t help themselves is full of it. It helps those who don’t want to help themselves.  [emphasis mine]

Consequences, Lessons, and Warnings

Consequences


The deficit crisis that threatens the Euro has also undermined the sustainability of the European standard of social welfare. Europeans have bragged about their social model, with its generous vacations and early retirements, its national health care systems and extensive welfare benefits, contrasting it with the comparative harshness of American capitalism. It has benefited from low military spending, protected by NATO and the American nuclear umbrella. But all over Europe governments with big budgets, falling tax revenues and aging populations are experiencing rising deficits.

Changes have now become urgent. Figures show the severity of the problem. Gross public social expenditures in the European Union increased from 16 percent of gross domestic product in 1980 to 21 percent in 2005, compared with 15.9 percent in the United States. The French state pension system today is running a deficit of 11 billion Euros, or about $13.8 billion; by 2050, it will be 103 billion Euros, or $129.5 billion, about 2.6 percent of projected economic output.

President Nicolas Sarkozy has vowed to pass major pension reform this year. The French government, afraid to lower pensions, wants to increase taxes on high salaries and increase the years of work. But the unions are unhappy, and the Socialist Party opposes raising the retirement age. Europeans say the Continent will have to adapt to fiscal and demographic change because social peace depends on it.

Lessons

In 2009, European government spending as a share of GDP rose to 51 percent, and to 36 percent in the US with the Obama stimulus plan. With Obamacare, America’s number will rise into the low 40 percent range. If the present administration realizes all of its ambitions, the American profile will look more like Europe’s. And that will be disastrous news for America. What the global debt crisis should tell us is that the European socialist model leads to disaster. The lesson Americans should draw from the market turmoil of recent weeks is that America requires a sharp about-face, away from the statist direction of the Obama administration.

President Barack Obama has made great strides toward implementing the European Socialist form of government with passage of his recent health care reform plan. It appears, however, that the European Union is finally waking up to the fact that nothing in life comes for free. So what does all this mean for the U.S.? Why should we care what happens across the Atlantic? People want the government to provide them with everything, but they don’t want to pay for anything. When the government does begin to provide its citizens with everything, it creates an unsustainable entitlement.

The socialist ideal contained three ideas at its core: economic central planning; the belief in collective or group rights; and the case for nationalized social services. The application of these three ideas in socialist countries resulted in economic chaos, social conflict and ethnic warfare, and the collapse of all basic services. The American people seem oblivious to the lessons to be learned from the socialist experience in other lands. And the ideas leading us further along our road to socialism are the same ones that lead other peoples to the dead-end of state control, economic stagnation, group conflict and societal decay.

Warnings

If Americans think fuel and food prices are high, they should try Europe, particularly Italy. In theory, Italians accept that they are going to have to be a lot more like the Germans, and less like the Irish, Portuguese, and Spaniards. In reality, they may end up like the Greeks, who are still striking and occasionally rioting because too few foreigners wish to continue subsidizing their socialist paradise. All this European turmoil raises a paradox. If Europeans are conceding that something is terribly wrong with their half-century-long experiment with socialism, why in the world is the Obama administration intent on adopting what Europeans are rejecting?

So where are we now?

We have seen that Obama’s political policies are leading the U.S. toward socialism. We have seen why it is that some people favor socialism. We have learned that economists do not like socialism. We have seen the consequences of socialism, and have received lessons and warnings from Europe. The question now is: Will the U.S. heed these consequences, lessons, and warnings?

But that’s just my opinion.