Socialism on the Sphere

Earlier today I was listening to the STA Money Hour on radio (it comes on at noon weekdays on KPRC 950 AM), and one of the hosts mentioned he’d had a conversation with his young adult son about socialism, what it means, what’s being taught in schools and elsewhere, what the young man’s friends thought. And the answer was kind of scary. There’s so little knowledge among young people, who are being taught that socialism is about “fairness” and “sharing the wealth” so that these young people get free education, free healthcare, and other free “stuff.” So the host said it was his plan to post the video of Milton Friedman on the Phil Donohue Show, from decades ago, that so clearly explains the economics of it. I’ve shared that video before, but I’m including it again at the end of today’s post.

Later today I heard Larry Elder mention on his show, that there’s a recent poll showing that large numbers of young people in their 20s and 30s favor socialism—this in the face of Venezuela. They don’t seem to make the connection.

Last week economist Thomas Sowell was asked about the growing approval of socialism in America; would we resist it? He said he hoped so, but he wouldn’t bet on it.

Socialism, in red, overlaps with other -isms,
but they're all down into tyranny.

So today I’m doing my little part of educating the world on socialism, using what we know from the Spherical Model.

How do we know where socialism is on the sphere?

The same way you know about any government type or -ism: you see how it answers the questions for reaching north on the political, economic, and social spheres.

So let’s try it. We’ll try this one sphere at a time, but be warned that the spheres interrelate.

Political Sphere

Question 1: Is socialism something that an individual has the right to do, and therefore has a right to delegate to his/her government?

Answer: Depending on how we’re defining socialism, there’s some range here. Socialism could mean that government takes over various sectors of the economy, or maybe the entire means of production for a country. It’s a matter of degree, but socialism implies that government has the right to take private property without due compensation.

Socialism defines property “rights” as “whatever the government allows you to control as if you own it,” but government is ultimately the actual owner of whatever it decides to take ownership of.

But in real life—what we call natural law—we don’t have the right to take someone else’s property, which essentially means taking the fruits of labor from someone’s life, thus enslaving them; therefore we don’t have the right to delegate that right to our government.

This means socialism doesn’t pass the freedom test on this question. Socialism is southern hemisphere. The more power that government takes that the people do not have the right to grant to government, the more tyrannical the government.

Question 2: Does socialism infringe in any way on the rights enumerated in the Bill of Rights?

Answer: Let’s remind ourselves of those God-given rights—just the ones listed in the Bill of Rights. (There are, of course, others.)

·         Freedom of religion, speech, press, peaceable assembly, petition government for redress of grievances.

·         Right to bear arms.

·         Right to security in our homes and papers, and from illegal searches and seizures.

·         Right to a fair and speedy trial, by jury.

·         Freedom from excessive bail, excessive fines, or cruel and unusual punishments.

The final two amendments of the original Bill of Rights add that government is limited to the enumerated powers granted in the Constitution, and that any rights not enumerated are retained by the States or the individual people.

In theory, socialism wouldn’t have to infringe on all these rights; it would only need to infringe on property rights. However, in practice, in order to enforce the coercive taking of property, in all the countries that have tried it, we’ve seen many more rights infringed. The right to bear arms gets lost early on. So do free speech rights—and all the rest of the First Amendment. The judicial system gets corrupted, and “fairness” becomes whatever the government says it is, no matter how unjust.

So, socialism falls into the southern hemisphere on this question.

Question 3: Is socialism within the proper role of government, some aspect of protecting life, liberty and property? These include national defense, protection from interstate crime, enabling (not controlling) international and interstate commerce, standardized weights and measures and currency, and the judiciary that guarantees the protective laws?

Answer: Socialism isn’t about protecting life, liberty, or property. It purports to be about fairness, and “protecting” people from poverty. But, as we know, whenever government interferes in a way that is beyond the proper role of government, there will be unintended consequences, which are usually the exact opposite of the stated goal. So, if socialism intends to get people out of poverty, you can expect the unintended consequences to include putting people into poverty.

That’s what we’ve seen happening in Venezuela. The richest nation in South America fell into abject poverty in about a decade. In some countries the fall has taken longer, 30 to 50 years. But it has happened every time. China, Soviet Union, Cuba, North Korea, Cambodia. Everywhere it’s been tried. As it forces the people into deprivations while taking away their ability to rebel, tyranny reigns
.

screenshot from Stuart Varney report on Venezuela August 2018

Socialism is designed to fall into tyranny.

Economic Sphere

Question: Who decides what will be done with the fruits of your labors?

Answer: There’s only that single question for the Economic Sphere. Does the person who produced something through his labors get to decide how the fruits of his labors are used? Or should someone else decide? In socialism, it’s someone else. Government. Probably a distant bureaucrat, who decides that, if someone produces quite a lot—far more than the person needs for subsistence, so that the producer accumulates wealth—then government should take a portion of that wealth and distribute to someone who was not as successful at producing surplus fruits of labor.

Socialism ignores how hard a person works, how valuable a person’s work is to society, or how careful a person is to accumulate his wealth rather than quickly spend it. Socialism is only concerned that the outcomes should be equalized.

Socialism fails to take into account that, if a person doesn’t get to keep the fruits of his labors, and the government promises to give enough to everyone regardless of effort, socialism has taken away the incentive to work. And the result, before long, is that those who would have produced more will no longer bother to do so.

Socialism, therefore, not only takes what has been produced from the producers, but it leads the producers to produce less in the future—which means there’s less to take, to redistribute. That’s how poverty results.

Another option for producers is escape. Those who want to keep more of what they’ve produced will leave a place where a government takes their earnings. Even if government were to confiscate all their wealth, those producers who escape would still have their human capital, which they would take with them to produce more wealth in a less hostile environment. That’s one reason socialist countries have historically prevented their people from leaving. And you’re hearing complaints from New York's governor about the wealth producers leaving, just when they had so many uses for the exorbitant taxes they were charging.

Socialism doesn’t lift people out of poverty; it sinks entire societies (except for a few ruling elite) into poverty.

Social Sphere

Question 1: Does socialism allow for and encourage the flourishing of religion?

Answer: There’s an essential reason for this question. Rights come, logically, from either a greater than human source or a human-given source. If rights are God-given, then a person is entitled to them simply by virtue of being human. No human can rightfully deprive you of them. But if rights are not God-given, then there is no guarantee the human giver will not take them away.

Say, as in so-called “Democratic Socialism,” a majority votes that you should be deprived of your property simply because you have more than the majority (or its appointed bureaucrat) deems that you need or qualify for. You’re deprived of your property rights because you worked harder or smarter than someone else. Put another way, the majority has enslaved you to work for the majority’s benefit, rather than your own. The majority is a human tyrant.

And since the actions of a socialist government are tyrannical—i.e., go against your God-given rights—coercion will be necessary to do the enslaving, so you’ll lose additional rights.

But here is the crux of the matter: socialism claims to be a way to alleviate the unfairness of unequal outcomes, those terrible inequalities, or disparities. Without socialism, how do you deal with the fact that some people are starving or homeless while others enjoy mansions and private jets? Socialism claims to be moral and charitable.

But is it? Is it charitable for you to go on your neighbor’s property, steal the apples he has grown and was going to pick and sell at a market, and instead take those apples and distribute them to some hungry people down the road?

If your neighbor finds out and decides—voluntarily chooses—to allow for this theft for the sake of the hungry people, that says something about the charitable (and also merciful) feelings of your neighbor. But it says nothing about you except that you disrespect your neighbor’s property. You didn’t give anything of your own to feed the hungry. So you should stop smugly calling yourself charitable.

We can’t delegate our ability to give charity to government to do for us, because we don’t have the power to give someone else’s property charitably. We only have power to give our own property.

But isn’t that what we do when we pay our tax money to government to distribute to the poor?

The simple answer is no. You give tax money to government to carry out government responsibilities, of which charity is not one. When you vote (or have your representatives vote) to take tax money for charitable purposes, you’re giving your money and your neighbors’ to government bureaucrats to make decisions about who deserves what, which opens up all kinds of possibilities for favoritism and corruption.

If you donate your charity directly, not only is that actual charitable giving, rather than coerced “giving,” there’s no portion of it going to a government bureaucrat, so more money goes to the charitable cause. If you give to an organization, you can do your research to know who they serve, how they decide who’s deserving, and how much of your donation goes directly to charitable purposes rather than overhead.

So there’s a free choice way to take care of the poor, and socialism isn’t it.

But that real way does require a righteous people—a religious people, most likely—who feel the personal obligation to help out their fellow human beings.

Earlier today, the Heritage Foundation linked a piece well worth reading by historian Lee Edwards, “What Americans Must Know about Socialism.” The piece ends with this:

This is the reality of socialism—a pseudo-religion grounded in pseudo-science and enforced by political tyranny. This is the case against socialism—a god that failed, a science that never was, a political system headed for the ash heap of history

Socialism is a religious perspective, but it places government in the role of God. And instead of seeing theft and coveting as sins, it exalts them as basic principles.

Question 2: Does socialism promote the family as the basic unit of civilization?

Answer: No. Socialism tries to replace the family. It tries to be the source of rights, provider of needs, educator and inculcator of ideology, controller of messages, controller of behaviors. It assumes that people would not do what government calls “good,” left to their own devices. So it steps in, where the family used to be, to provide and teach its ways, and to coerce and punish any disagreement or disobedience. And it punishes much more severely than a loving parent would. Violence against dissent isn’t a mistake in how it has been implemented; it is an inherent practice.

Socialism is not intended to grow civilized adults, as a family is intended to do; rather, it is intended to grow submissive minions to allow the ruling elite unlimited power.

Ahead of a story on Venezuela posted on Facebook on March 8, the Heritage Foundation summarizes with this:

Socialism always promises progress, but it inevitably delivers scarcity, corruption and decay.

Rather than empower the common man, socialists believe in empowering bureaucracy. In their minds, bureaucrats will always make decisions based on science and dispassionate reason—and make sure those decisions are implemented and enforced efficiently.

It’s an elitist, intellectually arrogant belief, and it’s dangerous.

Capitalism is the economic engine of freedom, prosperity, and civilization. Socialism sinks us into tyranny, poverty, and savagery.

Here is the Milton Friedman video again: 

Deny! Deny! Deny! So What?

There’s a pattern used by the opponents of liberty. It is to deny some behavior, or belief, that is clearly contrary to civilization. Deny repeatedly. And then, suddenly to admit the accusations were right all along, but to admit without shame, with smugness even, and a “so what?”

The timing of the denial is important, because it’s hard to maintain shock and outrage. So the repetition allows time to dilute impact. And then, when there has been enough dilution—then comes the “so what?” The admission, with the cynical barb that, anyone outraged by this is reactionary, prudish, “on the wrong side of history.”

I've written about rhetorical strategy before, covering a few examples. Today we'll do a little review and then add a new one.

First example. Back in the 1990s, Bill Clinton spent half a year claiming, “I did not have sex with that woman, Ms. Lewinsky.” And then, of course, he finally admitted to it, but added the "so what?” It was just his private life, nothing to do with his role as president.

But that wasn’t actually true. Having sex with a presidential intern, in the Oval Office, is abuse of power, an appalling evil in itself, but also opened the president up to blackmail or coercion. With the "so what?" he admitted to the abuse, but still refused to take responsibility by claiming it didn't matter.

One more disturbing thing is, people who started out agreeing that having sex with an intern was egregious departed six months later, mainly along party lines, giving that president a pass for his bad behavior—as well as his months of lying about it.

Second example. Pro-abortion activists denied, denied, denied that an unborn baby was a human life. Then, as technology makes the facts of life ever more clear—and literally gives us a clearer view of the growing baby—those science deniers start saying “so what?” Several years ago, a Salon writer said it was just too hard to go up against the “it’s a life” argument. So why not embrace that fact and just add “so what?” Sure, it’s a human life; but that doesn’t mean it’s worth protecting, because not all human life deserves protection.

Really? Innocent life doesn’t deserve protecting? Why? Because that life might be inconvenient?

Third Example. Socialism. All through the Cold War, and the first couple of decades following that standoff, we were able to agree that communism, and its synonym socialism, was evil. Socialism is incompatible with our constitutional republic.

So proponents of socialism, knowing that, would try to push their government control schemes without using that name. It would be a “social safety net,” or “progress,” or government providing for “positive rights,” such as housing, minimum income, redistributed income from higher earners, healthcare in the form of enforced purchase of insurance, regulating to control certain industries, and more. 

Now—meaning the last few years—socialists are giving up the denial and starting the “so what?” They’re saying, “Yes, we’re socialists, and we’re proud of it.”

Examples include Bernie Sanders and his followers in the last presidential election. Then more recently Alexandria Ocasio-Cortez, the socialist who won the Democratic primary in June of this year, defeating a more establishment Democrat, for the 14^th Congressional District of New York. She has been a darling of the media since, and a target of conservatives, who look at what she says and can hardly believe anyone would go along with her, since she makes no sense.

This past week, CNN’s Jake Tapper asked her about a way to pay for the $40 trillion cost (an estimate provided by “left-leaning studies friendly to her cause.” She had no answer. She had previously suggested an increased tax on the wealthy and corporations that, assuming no change in behavior on the part of those earners, would bring in $2 trillion. What about the other $35 trillion?

Jake Tapper asks Ocasio-Cortez about a plan
to pay the $40 trillion cost of her planned programs
screen shot from here

She has no answer. Dig down enough, she believes you just tax the undeserving rich more. That of course won’t cover $40 trillion additional expenditures.

But she’s very Rah! Rah! about socialism, and is perfectly willing to call it by its name—leaving off, of course, the final result of granting government the power to take what it wishes from its people, up to and including their lives. 

Another “so what?” on socialism came from philosopher and erstwhile comedian/actor Jim Carrey. On HBO’s “Real Time with Bill Maher," Carrey said, “We have to say yes to socialism—to the word and everything. We have to stop apologizing.” 

Jim Carrey embraces socialism with Bill Maher
screen shot from here

Carrey was called out for it by a Venezuelan journalist, Laureano Márquez. Márquez was respectful, but better informed. He explained that many people believe socialism means “the antithesis of selfishness, synonym of concern for others…support for the weakest and their needs, of seeking health and education for all.” But in Venezuela, which just a relatively short time ago, was rich in resources, and one of the most advanced countries in the Spanish speaking world, “What we find is just that our regime is not—for God’s sake—the antithesis of selfishness.” Rather, he explained. “In Venezuela, dear Jim, from what I have just told you, there is no equitable distribution of wealth; wealth is concentrated, as rarely before in our history, in very few hands.” 

In socialism, someone decides—someone other than the person earning the money—how and where money will be spent, on what it will be spent, who gets to do what. Someone decides. And that person or group of persons has all the power over people’s lives. Those few elite deciders don’t go hungry when poverty strikes the general population. Those elites aren’t inconvenienced when the people can’t even get hold of toilet paper. Those people are the ones confiscating small amounts of food at the border that people were going to try to sell in exchange for needed medicine. Those are the ones enforcing a minimum wage that no one is receiving, because no business can afford to pay it.

But Venezuelan president Maduro dines on steak, during a visit to Istanbul. People were outraged, of course. But maybe that’s fine with him.

In a New York Times op-ed, Amherst College Professor Javier Corrales writes, "An extremist government like Maduro's prefers economic devastation to recovery because the misery destroys civil society and, with it, all possibility of resisting [the regime's] tyranny." 

At this “so what?” moment surrounding socialism, our society can go either way: shrugging our shoulders and deciding it was never all that evil in the first place, or standing up to it, because we know based on principle, and based on overwhelming evidence, that socialism is just another iteration of statist tyranny, which inevitably leads to loss of freedom and loss of life, and toward abject poverty and savagery.

Little Red Hen Economics Lesson

There’s an old folk story called “The Little Red Hen.” A hen comes upon a grain of wheat and decides to plant it. She asks for help from various barnyard animals, but none will help. Not with the planting, the watering, the weeding, the harvesting, the threshing, the milling, or the baking into bread.

But then, when it comes to eating, they’re all willing. But the hen turns them away, and feeds the bread only to her little chicks and herself. Image from Wikipedia: 

Was that fair to the other barnyard animals? The purpose of the story is to teach that yes, it was. She worked for her bread, so she got to use it for her own family.

book cover image
from Wikipedia

Having the bread, as the ultimate end of all her labor, meant she was more wealthy than all the other barnyard animals. Is that fair?

Was she more wealthy because she took advantage of the other animals? No.

Had she deprived them of opportunities to work and earn their share? No.

She did make use of the found seed, which seems to be a free resource advantage. But we don’t know if that was a commonly available resource to all, and anyone else who had picked one up and done the work might have yielded the same result.

So you might say that it’s natural for us to believe that the person who makes the bread eats it—or, in other words, the person who earns the wealth gets to decide how to spend it.

That hasn’t been happening for a while in Venezuela. One of the richest in resources, this country had plenty to start with, but socialism ate it all up. People are starving. Money is undergoing hyperinflation. People have shortages of essentials like toilet paper.

Stuart Varney, on Fox News, Monday, points out that Venezuela is a corrupt socialist dictatorship with a collapsing economy. But he warns against intervention. “Send in food, and Maduro extends his power.” It’s a sad tale and not getting better soon. Varney suggests: 

screen shot from Varney on Venezuela

Maybe Venezuela is best used as an example for our own socialists here in America. Socialism is making great strides among young people. Venezuela could be one of those teaching moments. After all, in our schools and colleges, socialism is often held up as something wonderful. The sight of Venezuelans eating out of trash cans might open some eyes. But let’s be clear: Venezuela is done. It is not our fault. It’s not our responsibility. But it is a very strong warning to the pie-in-the-sky socialist dreamers.

One of those pie-in-the-sky socialist dreamers said more economically ignorant things this week, which brought a response (and eye roll) from Ben Shapiro.

Alexandria Ocasio-Cortez on Pod Save America
image from here

Alexandria Ocasio-Cortez was asked on a Pod Save America interview how she planned to pay for her various socialist necessities: single-payer healthcare, free college tuition, guaranteed jobs, guaranteed income for all, etc. You can see her answer here, along with a transcription, which is pretty painful. A friend, who is socialist/progressive/leftist-minded but otherwise a decent guy, and old friendships require some tolerance, promoted a video of her on Facebook today, because he was so impressed with her. There’s no accounting for taste, I guess. Or like-mindedness appeals.

Anyway, on yesterday’s podcast (starting at about 23 minutes) Ben Shapiro shared some of the numbers related to her (and Bernie Sanders’) intended plans. Her answer, Shapiro points out, never responds to the actual question:

I do love the fact that the original question here was, “How do you pay for things?” And her answer is, “Nobody pays for things.” Thank you, Alexandria Ocasio-Cortez, for that brilliant exposition on the debt and deficit in the United States.

So we’ll just magically keep spending money we don’t have, because she thinks government has an unlimited supply, and all that is needed is someone convincing government to spend it the way she sees fit.

Some things, though, she thinks are stupid spending: tax cuts and wars. Of the $4.3 trillion federal budget this year, what percentage was military spending? 16%. But on social programs?

62% of the entire federal budget goes to mandatory spending under Social Security, Medicare, and Medicaid. The vast majority goes to social welfare programs that Alexandria Ocasio-Cortez says we’re spending too little money on. The fact is, the amount of money we spend per capita in the United States on social welfare programs is actually almost on par with that of the European countries, and actually surpasses some of the European countries.

He adds,

Social Security will be bankrupt in the next decade. Medicare will be bankrupt a decade after that. These programs are not going to be around. Or, if they are around, they’re going to require massive cuts or massive taxes.

While she says we shouldn’t worry about spending, because we’ve never worried about it before—she’s wrong; many of us do worry, because we know debt always comes due, but at least we have economic growth right now, which mitigates the damage slightly—we’ve also never contemplated the insane level of spending she suggests. Ben Shapiro continues:

According to the Mercatus Center, the libertarian leaning center at George Mason University, they estimated that Bernie Sanders’ Medicare for all plan—we talked about this last week—would cost the government $32 trillion over the next decade.

But, we can actually do a budget exercise using nonpartisan and even left-leaning groups. Vox.com, a left-wing source. They talk about what exactly we would have to pay for single-payer health care, a jobs guarantee, and free college; what exactly would it cost? Well, it turns out that it would cost, according to the Tax Policy Center, it would cost legitimately trillions and trillions and trillions and trillions and trillions of dollars. $42.5 trillion in new proposals over the next decade, on top of the $12.4 trillion baseline deficit.

To put this into perspective, according to Vox.com, Washington is currently projected to collect $44 trillion in taxes—in revenues, that’s what they call it—over the next decade. Ok, the Republican tax cut, the “fiscal Armageddon,” will cost less than $2 trillion over the next decade. So we’re going to spend $44 trillion, but Alexandria Ocasio-Cortez says the real problem is those tax cuts that “cost” $2 trillion.

What is the 30-year projected tab for these programs that they’re talking about? The 30-year projected tab is, I kid you not, $218 trillion, on top of an $84 trillion baseline deficit driven by Social Security, Medicare, and the resulting interest costs. Federal spending, which is typically between 18 and 22% of GDP in the United States, would soar past 40% of GDP on its to 50% of GDP within three decades.

She thinks the government shouldn't do something so profligate as letting Americans keep $2 trillion, spread over a decade, of money they earned, but it's a wise "investment" to spend two hundred times that on things that are not within the enumerated powers of government.

I’m trying to picture how vast that $218 trillion "infinity and beyond" number is.

Here’s the Federal Reserve's historical chart of federal spending as a percentage of GDP:

See that spike in the 1940s? That's WWII. Imagine a spike that high by 2030, and nearly triple the normal within 30 years. It’s usually around 20% of GDP. The socialist spending plan would blitz past WWII-era emergency spending, up to between 50%-60% by 2050. 

Assuming we continue with good GDP growth, which we wouldn’t. Because, as we know from the Little Red Hen, when you do all the work yourself, you’re entitled to decide how to spend it. And we know from all the socialist experiments, if you don't get the fruits of your labor, you're not willing to do the labor.

There’s a socialist argument that, all those failed states, they just didn’t do it right; "This time we’ll do it right," they say. But if you’re talking about letting someone as out of touch with reality as either Sanders or Ocasio-Cortez give it a try, there’s zero chance of not making the mistakes that have caused every socialist state to fail. And the more corrupt or just plain wrong those elites who make the decisions, the quicker you get to Venezuela, or Stalinist Russia, or Cuba, or North Korea—any place where you have to force people to stay, and where the state blithely says to its subjects, “Your death is a loss I’m willing to bear.”

Every time a tyrant comes in and seizes power over your decisions on how to spend what you earn, and how to live your life—the eventual end is that you may not get to live your life at all.

The socialists start by breaking “Thou shalt not covet,” continue by breaking “Thou shalt not lie,” and end up breaking, “Thou shalt not murder.” Every time. Don’t trust a covetous liar to wield positions of power.

Tyranny in Our World

Wherever government fails in its basic purpose of protecting life, liberty, and property, and instead deprives its own people of those very things, you find tyranny.

We have too many examples in our world today.

North Korea

Kim Jong-un with missiles
image from here

According to the Human Rights Watch 2016 World Report, conditions in North Korea look pretty grim. Human rights violations include: “extermination, murder, enslavement, torture, imprisonment, rape, forced abortion, and other sexual violence in North Korea.” A UN Commission of Inquiry says the “gravity, scale and nature of these violations reveal a State that does not have any parallel in the contemporary world.”

What does that look like on the ground?

Food is scarce. People are on the verge of starvation. They have no communication with the outside world to back up suspicions that the rest of the world is not even worse off, as they are told. Those who try to escape into China are detained and returned to detention, forced labor, or public execution. Yet some are still willing to attempt to escape. Among women who “successfully” escape, chances are high they will be enslaved into forced marriages or the sex trade.

Dynastic dictator Kim Jong-un is presented as a god to his people. Apparently they don’t expect much from their deity, since he recently murdered his brother (older brother, who had the greater claim to leadership, if I understand correctly). There is no other deity allowed, since religious belief is systematically quashed.

While their leader must know better (he was educated in the West), they believe they are the most powerful force on earth—because that is what they are told, and they have no access to information to discredit that lie. North Korean indoctrination would put Orwell’s 1984 world to shame.

Meanwhile, they have developed nuclear capability and are attempting to move beyond rudimentary delivery technology.

There has been saber-rattling, as a rule, annually every spring. They have done this with impunity for years, because of the rest of the world’s unwillingness to put a stop to it. This year the difference is a new US President who is an unknown quantity, but not one to suffer bullying. China is stepping up, because they now know that, if they do nothing to control their rogue vassal, the US will. And China doesn’t want increased US power in their vicinity.

The North Korean situation wouldn’t be what it is, if the war had been completed back in the 1950s. It continues, in the form of a cease fire, with enemies remaining enemies, and no progression such as Japan and Germany made after WWII. Stalemate may not last forever.

Meanwhile, South Korea flourishes economically and in many other ways, creating a contrast with the northern part of the peninsula that ought to be instructive to all the world.

Venezuela

Venezuela is resource rich: oil, coal, bauxite, iron, gold, and natural beauty. Nevertheless, most of its population now lives in poverty.

No food. It has become a real problem. Millions have cut back to one or two meals a day. Millions have lost, on average, 19 pounds.

Inflation is at over 50%. Money is controlled, and its value too low to bring in much from the outside. Travel, particularly travel by citizens with money, is limited. There had been a practice of crossing the border to Bolivia to get better exchange rates, but that was quashed.

empty supermarket in Venezuela
image found here

Government is corrupt and ineffective. Crime feels similar to living in a war zone, with over 90% of crimes remaining unsolved, including murder.

Following the death of Hugo Chavez, his successor, Maduro, won election by only 2%, meaning nearly half of the people are still willing, so far, to say that they don’t like the way government is failing them.

We’ve known people from Venezuela. It wasn’t always like this. While it wasn’t America, it was livable and prosperous. Now people can’t get hold of toilet paper or bread, and there seems to be no way out. But, while it’s obvious from the outside that the fault of this swift demise of a country is socialism, government has done a pretty good job of claiming the fault lies with the business class.

Many radio and TV networks simply had their licenses revoked. The last remaining dissenting TV station was sold in 2013, and then announced its policies would be changing. Venezuelans have voted for socialism time after time, but you have to wonder whether they can be informed voters when they have no access to truth in the media or from their government.

Syria

It’s essentially impossible to be living in Syria during the ISIS war without participating. Everyone else is a refugee or target of genocide.

Getting basic food and shelter for the refugees is a worldwide problem. Many have crossed into Turkey. Others elsewhere. Some have been transported afar, to Europe or America. There’s a preference to stay nearby, as refugees, in hopes that the enemy will eventually be rooted out, and they could return to their homeland. Others have given up hope, and their best future lies in finding work and a new life elsewhere.

If there is one thing ISIS is certain not to do for people it governs, it is to protect their lives, liberty, and property. Murder, genocide, and rape are expected activities from this regime. The savagery is hard to imagine.

Sweden

By comparison, Sweden looks much less bad. But there are invading hordes of Islamic people—some are peaceful Muslims, even refugees, but others are Islamists who hate anyone not like them, and the Swedes are definitely not like them.

In an effort to welcome these people, and show openness and tolerance, the Swedes have over-tolerated their behavior, which includes rape with impunity. Government and media spin—remove demographic information from reports—so that it doesn’t look like it’s caused by the invading hordes. Because there is more fear of being labeled as bigoted than there is fear of its own population being raped.

A government, or media, who tells this lie—at the expense of the safety of its own people—is tyrannical. Add to that the corrupt control of businesses, and what seemed to be the world’s example of “successful socialism” is not so exemplary. Success, in business, in fact, comes only as they move away from the socialist model toward free markets.

There are other tyranny/savagery zones in the world. Anywhere there is war, you’ll find those conditions. But sometimes even without war.

Try France, which, like Sweden, has welcomed in enough Islamists that terrorism is becoming part of daily life.

Or, closer to home, Chicago, where murder rates make it look like a war zone. Or many parts of our southern border, controlled by drug gangs.

Tyranny goes hand in hand with savagery. And poverty.

The way out is toward freedom that comes from a government limited to its protective role, free markets and their attending prosperity, and civilization of people living corruption-free lives.

The way to freedom, prosperity, and civilization—all three together—is a known path. But the peoples of the world don’t seem to be aware. And the suffering continues, and spreads.

Ending tyranny for all the world will probably only happen when Christ returns to reign personally on the earth. In the meantime, we can at least spread the right way to our children, and our own circle of influence, and hope for better.

Freedom Is a Universal Desire

It is my belief, here at the Spherical Model, that freedom from repression is interrelated with prosperity and civilization. It’s easy to see why people want civilization and prosperity. And since tyranny limits civilization and prosperity, while the freedom of small government limited to protecting God-given rights leads to flourishing, it is logical that anyone with understanding will also want freedom. People will yearn for it. They will recognize the unfairness, the corruption—the evil—of tyranny. They will want to move “northward” the way a swimmer moves up to the surface for air.

We can see evidence of this universal desire for freedom. This past week one example is Ukraine.

We haven’t been getting very much news out of Ukraine, but there have been protests in the streets for some months. If I have gathered accurately, the Ukrainian people have wanted to remain European, connected to the European Union, with increased capitalism, while their president, Yanukovich, has been leaning toward Putin’s Russia. There are ethnic differences. Within the country’s boundaries is a significant minority that are Russian rather than Ukrainian, and wouldn’t mind reconnecting with Russia.

But you have the Ukrainian people who lived under the repressive Soviet Union until just over two decades ago, who gained their freedom, who want to grow and live in freedom—these people have absolutely no incentive to submit to yet more tyranny.

Things reached a turning point this past few days. Police snipers, presumably on orders from the president, shot as many as 100 protesters in the streets. (Government reports claim the number of deaths is a mere 77; however, 577 were injured, and 369 hospitalized.) Then the president was deposed. I’m not sure exactly how the deposing too place. There is some discussion that Yulia Tymoshenko, prime minister recently released from prison, may be willing to step up. President Yanokovich has disappeared from his luxurious estate. Word this morning was that he hasn’t yet attempted to leave the country, so he may be in hiding somewhere. His home had been off limits to fellow countrymen for years. He used it for state dinners, one would suppose. But it was astoundingly opulent in a nation where average families get by on $500 a month.

We had neighbors some years ago who took their family on a once-in-a-lifetime trip to visit their relatives in Ukraine. They loved the people, who were so giving. But they were a little shocked at conditions. This was a relatively middle-class Ukrainian family, who were able to send their daughter to America to study abroad for her senior year. But in preparation for our friends’ visit, they upgraded their home by getting a new wooden toilet seat for the outhouse. It wouldn’t be surprising for people who have patiently waited as slow growth brings them prosperity to be very angry to learn of their president’s lifestyle.

Photos showed the estate this weekend, with people invading and looking around—in shock, because apparently his exorbitant lifestyle was kept hidden from the people. Yet, at least in the photos I saw, people looked around like tourists—no windows broken, no looting, no one even entering the house. There were however attempts to recover paperwork, some of which had been partially burned, and some which protestors were beginning to sort out.

Among some of the most effective word that got out was a YouTube video, uploaded 2-10-2014, called “I Am Ukrainian.” A young woman named Yulia makes an impassioned plea, in English, with video and photos backing up her words, asking for help getting the word out. I attempted to transcribe her words (sorry for any errors), which verify the basic belief that people everywhere yearn for freedom.

I am the Ukrainian, the native of Kiev. And now I am now in Maidan [??], in the central part of the city, to know why thousands of people all over my country are on the streets. There is only one reason: we want to be free from a dictatorship. We want to be free from the politicians, who work only for themselves, who are ready to shoot, to beat, to injure people just for saving their money [or “saying their minds” ??], just for saving their houses, just for saving their power. I want these people who are here, who have duty, who are brave—I want them to lead a normal life. We are civilized people, but our government are barbarians.

It’s not the Soviet Union. We want our courts not to be corrupted. We want to be free.

I know that maybe tomorrow we’ll have no phone, no internet connection, and we will be alone here. And maybe policemen will murder us one after another. Then it will be dark here. That’s why I ask you now to help us. We have this freedom held inside our hearts. We have this freedom in our minds. And now I ask you to build this freedom in our country. You can help us only by telling this story to your friends, only by sharing this video. Please, share it. Speak to your friends; speak to your family; speak to your government and show that you support us.

[written on screen]: Please contact your representatives and demand they support the Ukrainian people in their fight for freedom and democracy.    

Before it’s too late.

This video was made in early February 2014.

Hopefully, thanks to you and the strong people of Ukraine, things will get better.

Please take time to view the entire two-minute video:

 

 

Meanwhile riots and reprisals continue to worsen in Venezuela as well. Our friend who was living there has returned to her native Uganda, so I’m relieved for her. The people there have for some time been seem clamoring for goods, promised to them by their failing socialist government (I know, “failing socialist government” is redundant). The question there is whether the people know to ask for freedom in order to get prosperity and civilization, or whether they have been successfully turned into government dependents who are now simply throwing tantrums that they are not getting what they were led to expect. You can’t simply demand “better” socialist government and expect that will lead to better prosperity and thriving civilization. You have to start by living civilized lives (religious people, strong families), where honesty, self-reliance, hard work, and caring for others become natural. Then you get better prosperity—and you realize tyrannical government is in the way of the flourishing that’s building up pressure to happen.

But what is happening now could bring to everyone’s awareness the innate need for freedom—for life and liberty. The government oppression of its people—usurping control over their words, their acts, and their very lives—may wake the people up to the disastrous choice it is to exchange material “security” for the freedom to work and prosper. I don’t know what the people will do there, but I hope they will seek freedom as if their lives depend on it, because they do.

Those of us who have some freedom (as long as we can keep hold of it), know to value it, and we want it for all peoples. We offer our support and prayers to any people reaching northward toward freedom, prosperity, and civilization.

The Rhetorical Question

On Monday I ended the post about economics in Venezuela with a somewhat rhetorical question:

Does government’s disrespect of property lead to the people’s disrespect of property—the looting? Or does a people who fail to live the rules of civilization naturally end up with a life-controlling government? It may be a chicken/egg question. But my guess is that imposition of tyranny—taking away God-given rights—demoralizes a people, quite literally.



Economist Walter Williams

My son Economic Sphere took on the challenge of responding to the question from the economic point of view. He passed along a piece written in July by economist Walter Williams. Williams’s point is that “political liberty thrives best where there's a large measure of economic liberty.” He shows that some people, essentially the same culture, are different living in different countries. Egyptians do well in the US, but not in Egypt. Nigerians do well in the US, but not in Nigeria. Indians suffer severe poverty in India, but in the US they “start more Silicon Valley companies than any other immigrant group.” And they succeed not just in relatively “red” places like Texas and Florida, but also in Massachusetts, New York, and New Jersey.

It’s something like the economic version of the Bush assertion—“I believe that God has planted in every heart the desire to live in freedom.” Given circumstances that grant economic freedom, a good people will eventually prosper.

Looking more closely at Egypt, Williams emphasizes the need for property rights. They don’t have clear titles to their capital property, so they can’t use it as leverage or investment to grow businesses.

Government is a major employer in Egypt—almost equal to the private sector. Only the underground economy is a bigger employer. Government size means greater government interference, which is another hindrance to prosperity. Williams quotes a Wall Street Journal article by Hernando de Soto:

To open a small bakery, our investigators found, would take more than 500 days. To get legal title to a vacant piece of land would take more than 10 years of dealing with red tape. To do business in Egypt, an aspiring poor entrepreneur would have to deal with 56 government agencies and repetitive government inspections.

There are states in our country where government interference, while not that extreme, feels onerous enough to prevent opening a business, but there are other states where the process is streamline to welcome business.

Williams uses the nation of Chile as a comparison—one of the few modern nations to move from controlled economy to free market economy, rapidly enough that we can see it as a lesson. Chile also helps in answering our question about the influence of economic freedom on political freedom. In 1973 Chile had a military coup—not that uncommon in those decades in Latin American countries. However, the new military dictator, Pinochet, did a surprising thing for a tyrant: he instituted, by edict, free market reforms. Pinochet eliminated “thousands of restrictive laws governing labor, mining, fishing, vineyards, startups and banking.” The economy turned around, and has thrived since—despite some of the expected savagery over the years that you expect in a tyrannical regime. Nevertheless, even decades later Chile rates in the top quartile of nations for economic freedom. Also today, political freedom ratings for Chile are mixed but mostly toward the free end of the scale.


World Economic Freedom Report 2013

Venezuela, which we talked about on Monday, lags at the bottom of the economic freedom scale, along with the least free African nations. The five subjects of economic scrutiny in this report are:

1)      Size of government.

2)      Legal system and property rights.

3)      Sound money.

4)      Freedom to trade internationally.

5)      Regulation.

We could spend a day covering each of these. But we can summarize, by number, what we know:

1)      Bigger government is not better government, but is in most cases worse government.

2)      Government’s main purpose is to protect life, liberty, and property—and almost any additional governmental role is likely to interfere with those rights, rather than protect them.

3)      Messing with the money supply is a hidden form of tax—or “authorized” theft.

4)      Trade tends to improve the economic lifestyle level for both sides of the trade; the only possible exception might be receiving trade from a country that refuses to receive trade the other direction. But sometimes even in those worst cases, being the free-trade country is better than being the trade-protection country.

5)      Regulation is often code for protection of those in an economic sector from competition, preventing entry for starting businesses. Often this is a combination between politicians and the businesses which financially support their security in office. If there is a real need for regulation, it is arguable that every such case would be handled better in the private sector.

Back to the original question, which was not limited to whether political problems led to economic problems—they do. The question is a bit more existential—whether immorality follows from the interference with life, liberty and property rights.

Maslow’s hierarchy probably comes into the question. It’s harder to maintain integrity when hunger is an urgent and ever present need. (Stealing a loaf of bread was the beginning of the miseries for Jean Valjean in Victor Hugo’s epic story.) It’s harder to maintain integrity when surrounded by others who cheat on their taxes or in their businesses, where others do not respect life, liberty, and property rights. It’s harder to maintain marriage and family integrity—among the best predictors of economic prosperity—when divorce and infidelity get normalized around us. Morality is more difficult, but not impossible.

Conversely, communities of healthy families, with stable fair laws protecting life, liberty, and property, thrive culturally—and prosper economically. I think there is an inextricable connection between property rights, along with protection of life and liberty, and living the laws of civilization. Telling the truth, refusing to steal, refusing to lie, and even controlling one’s thoughts to prevent coveting—these are all among the rules for civilization. And they are also essential for economic prosperity. So every effort to make the moral choice adds to the likelihood of prosperity.

Chaos Blues

I’ve been worried lately about our friend Farida, who is working in Venezuela. Things have been rough there lately. It hasn’t shown up a lot in our news, but things are pretty chaotic. The root of the economic issues seems to be the government being low on cash (despite taking in $750 billion in oil revenue since taking over that segment of the economy in 1999).  So the government has been taking on debt, mostly from China. Inflation rates are around 54%.

When inflation is high, prices are high—or, rather, the money buys less. President Nicolas Maduro (successor to Chavez) doesn’t like the high prices. So he has declared that certain items—such as appliances—must cut their prices in half.

Venezuelan President Nicolas Maduro
photo from here

Some of the chaos is from crowds forming outside appliance stores, waiting to get in to make the lower cost purchases. But in addition, there has been a fair amount of looting. Crowds think, “The pries are too high; that means the store owner is trying to gouge us; since the store owner is evil, we have a right to take from him.” So they break in and walk off with flat screen TVs—in a country where toilet paper and one in four food items are considered scarce.

The thought of the chaotic mobs is not a far stretch from what government thinks—what we want, we take. These store owners had to purchase the goods ahead, with pre-inflated Bolivars (the currency). If they sell at pre-inflated prices, they cannot replace their costs, let alone purchase more goods for future sale.

Is it possible that some store owners are price gouging? Possibly. But in a free market, if a seller asks a price too high, demand drops, so he has to lower prices in order to make sales. It’s not a problem requiring the incarceration of the “bourgeois” businessmen.

Let’s put it in simple numbers, as an example. Suppose it costs the store owner $100 to purchase a TV wholesale. Between the time of his order and the time he puts it out for sale in his store, inflation has kicked in. The $100 he spent is now equivalent to $154. He has to take in at least $154 to cover his wholesale purchase, to be able to buy another TV to sell in the future. That’s without profit. He also needs enough to cover overhead: cost of his building, cost of his employees, cost of transportation of the goods, and other basics business costs (including taxes on everything sold). But when he puts $154 on the price tag, that looks so high. The president doesn’t like the look of high prices—caused by his inflation-inducing monetary policies—so he blames the store owner and mandates a 50% price cut. That means the price is $77. That’s only going to cover half the cost of the item to the store owner. The government has just taken $77 from the store owner, and demonized him, adding insult to injury.

The store owner has just had his business destroyed, permanently. And crowds are suspicious that the evil store owner might be holding back goods in some back room, so they’re prowling to make sure that can’t happen.

Farida sent me links to videos of the looting. Here’s one, and here’s another. (One more was immediately deleted; I don’t know how paranoid to be about that.) She also said she had been essentially under house arrest for a week (that was her term, but I think she meant the company she works for was insisting she stay inside her home for her safety). She’s trying to get a Christmas break trip to meet family in Europe, but she keeps getting told there are no airline tickets available. However, she was able to spend a recent weekend in the nearby Caribbean, which is better than house arrest with no toilet paper or food. She was scheduled to work in Venezuela for 18 months; this coming February will be the one-year mark. But she says conditions are so bad, she’s going to be relieved from that contract and will be transferred in January. Living in socialist Venezuela has been rough for a young single female engineer; I hope the next opportunity is opposite of tyranny. Farida is a person made for living in civilization.

I am looking at the connection between respecting property rights and civilization. Does government’s disrespect of property lead to the people’s disrespect of property—the looting? Or does a people who fail to live the rules of civilization naturally end up with a life-controlling government? It may be a chicken/egg question. But my guess is that imposition of tyranny—taking away God-given rights—demoralizes a people, quite literally.

On the other hand, the way out of tyranny, and the accompanying savagery and economic desperation, is people choosing to live the laws of civilization, which include respect for property, life, and truth. It’s one of those life problems with a simple but not easy solution.

Running Out of Other People's Money

“The problem with socialism is that you eventually run out of other people’s money”—Margaret Thatcher

I was thinking about this quote a few days ago while conversing with a friend in Venezuela. Our friend Farida, from Uganda, who is working in Venezuela for another year or so, was in contact on Facebook. I asked her how she was doing, now that she had finished training in Houston and returned there. I was concerned because I’d read this article about shortages there, particularly toilet paper.

The article starts with this:

CARACAS, Venezuela - First milk, butter, coffee and cornmeal ran short. Now Venezuela is running out of the most basic of necessities — toilet paper.

Blaming political opponents for the shortfall, as it does for other shortages, the embattled socialist government says it will import 50 million rolls to boost supplies.

That was little comfort to consumers struggling to find toilet paper on Wednesday.

The conversation between government and economists is almost comical:

"State-controlled prices—prices that are set below market-clearing price—always result in shortages. The shortage problem will only get worse, as it did over the years in the Soviet Union," said Steve Hanke, professor of economics at Johns Hopkins University.

President Nicolas Maduro, who was selected by the dying Hugo Chavez to carry on his "Bolivarian revolution," claims that anti-government forces, including the private sector, are causing the shortages in an effort to destabilize the country.

The government has announced its intention to import 760,000 tons of food, plus 50 million rolls of toilet paper. Commerce Minister Alejandro Fleming said of this amount, "We are going to saturate the market so that our people calm down." I looked up population data, and Venezuela has a total population in 2011 of 27,635,743. We could round either up or down, but we can estimate how long 50 million rolls will last the population.

I’m an extravagant American living in plenty, who likes to be clean. I also happen to use the same bathroom most of the time, so I will do for estimating. With help of Mr. Spherical Model, we go through a roll in about two days. Let’s stretch that out, to double, for people who are trying harder to make things last. Let’s say, generously, that a person can make a roll last for a week. That means that, after a couple of weeks of ordering in 50 million rolls (assuming faster shipping and disbursement than is normal in Venezuela), the country must already have ordered another 50 million, because those are going to be gone before another order can arrive.

So I asked Farida whether she was experiencing these problems. Yes, indeed. She had been living in a hotel before her training in Houston, and now is setting up in her own little house. So she now needs products she didn’t worry about in the hotel. And no toilet paper is available. We discussed options. Amazon doesn’t ship there. Stores are empty. After two weeks of looking, she finally got some TP from “some Chinese guys.” She says, “Fortunately I always have baby wipes somewhere.” But for how long? I told her that my mother, as a young girl on a farm, used to use catalogs and other paper that was going to be thrown out anyway. She laughed, but she may be considering this.

She said, “It’s a roller coaster ride in this country. I feel like I’m doing my time…. The mentalities are worse than the struggles…. If I told you what I have had to go through in this country, you’d be shocked. There is nothing more hard to survive than a fixed state of mind. I haven’t told my family because they would be in a state of panic.”

Mr. Spherical Model has a new boss, who recently transferred from Venezuela. He lived there for some years with his family. Getting the family moved out has taken longer than planned—everything does. (This is the second boss over the years transferring out of Venezuela.) He confirmed the hardships. He met Farida briefly before leaving, and added that where she is located, near the oil fields, is really in the middle of nowhere, so it’s even harder to get needed goods.

Farida avoids bread anyway, but one of the success claims of Venezuela has been that it always provides bread to its people. It’s a kind of white “pita” called arepa, that is cut in half and then filled as a sort of sandwich. It hasn’t exactly caught on worldwide, but the people there are used to it. Except now they can’t even get their entitlement share of arepas.

Venezuelan bread, arepas, stock photo

I did the math on the food being imported by government as well. According to the US Dept. of Agriculture, the average American eats this much:

The US Dept. Of Agriculture estimates that the average person in the United States eats .5 lbs of meat, 1.6 lbs of dairy products, .2 lbs of fats and oils, .8 lbs of fruits, .7 lbs. Of vegetables, .5 lbs of grains, and .4 lbs of sugars per day for a total of 4.7 lbs. of food per day.

Let’s say that people in Venezuela are smaller, or used to less, and get by on 3 pounds of food a day. If I did the math right, the special shipment of 760,000 tons of food will last all of 18 days. By the time they can order more, again, the shipment (if it ever reaches the people) will have run out. In the US, if there’s a shortage, someone in the marketplace opens up a factory, or farm, or supply line, to sell to the waiting buyers. Seems more sensible.

Venezuela hasn’t always been this way. It may never have been as thriving as what we’re used to, but it has abundant natural resources, natural beauty, a good climate. It should be possible for people to thrive there. Socialism, among the population (exempting the elite rulers) has been a leveler. It has taken from producers, to make sure they had no more than non-producers. It has prevented innovation and success, removing incentive to produce. And it has created the mindset that government provides, so everyone will be dependent.

It is an exemplary socialist state: rulers create needs and provide just enough subsistence to maintain power over a helpless but not quite desperate people. If the goal is to provide power to a limited number of power mongers, it has met the goal. If it is, as stated, to build a utopian, perfect, productive equality society—it fails, as they all must.

The reason to bring up Venezuela, and other socialist tyrannies, is as a warning. We have power mongers, using socialist dogma and patterns, in order to remove power from us—We the people—in our Constitutional republic. We know what will happen if they are allowed to take us down that road—economic and social failure.

On the Spherical Model, only tyranny, economic deprivation, and savagery are possible when people are held down in the southern hemisphere. That is the only outcome possible. The only antidote is living the principles of freedom, free enterprise, and civilization. May we find the courage and character within ourselves to move back upward!