ECONOMICS
Socialism will always fail when regimes attempt to implement it because of:
1) the impossibility of economic calculation without true market prices, and 2) the lack of an incentive to produce only what consumers actually want. "John Maynard Keynes was born in 1883 and died in 1946. Keynes became the most famous economist of the twentieth century and the guru-crank whose work has inspired thousands of failed economic experiments and continues to inspire them today. He is the Svengali-like figure who implausibly convinced the world that saving is bad, inflation cures unemployment, investment can and should be socialized, consumers are fools whose interests should be dismissed, and capital can be made non-scarce by driving interest rates to zero — thereby turning the hard work of many hundreds of years by economists on its head." - Lew Rockwell More paper money cannot make a society richer, of course, – it is just more printed-paper. Otherwise, why is it that there are still poor countries and poor people around? But more money makes its monopolistic producer (the central bank) and its earliest recipients (the government and big, government-connected banks and their major clients) richer at the expense of making the money's late and latest receivers poorer. - Hans-Hermann Hoppe Economics in Quotes Capitalism is an economic and political system in which a country's trade and industry are controlled by private owners for profit, rather than by the state. Socialism is the political and economic theory of social organization that advocates that the means of production, distribution, and exchange should be owned and regulated by the government. Why people have trouble understanding economics "Economics is haunted by more fallacies than any other study known to man. This is no accident. The inherent difficulties of the subject would be great enough in any case, but they are multiplied a thousandfold by a factor that is insignificant in, say, physics, mathematics, or medicine — the special pleading of selfish interests." - Henry Hazlitt The most fundamental rule of economics "The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups." - Henry Hazlitt Socialism does not work in theory. “Socialism will always encounter two big problems when regimes attempt to implement it: 1) the impossibility of economic calculation without true market prices, and 2) the lack of an incentive to produce only what consumers actually want.” - Jorge Besada "Socialized medicine must fail for the same reasons all socialism must fail: it offers no system for rationally allocating resources, and instead promotes the overutilization of all resources, ending in bankruptcy." - Lew Rockwell "The larger the percentage of the national income taken by taxes the greater the deterrent to private production and employment. When the total tax burden grows beyond a bearable size, the problem of devising taxes that will not discourage and disrupt production becomes insoluble." - Henry Hazlitt Socialism has always failed in history. “It's not as if socialism is a new idea. It was tried in the 20th century. It produced economic stagnation and despair. In its purest form, it extinguished more than one hundred million people.” - Lew Rockwell "Socialism in general has a record of failure so blatant that only an intellectual could ignore or evade it." - Thomas Sowell “State interference in economic life, which calls itself economic policy, has done nothing but destroy economic life. Prohibitions and regulations have by their general obstructive tendency fostered the growth of the spirit of wastefulness.” - Ludwig Von Mises “Socialists have attempted many times to put their ideology into action. Socialism has been applied in the Soviet Union, Cuba, China (before Deng), North Korea, and by many other less-famous regimes. In each case, the result has been economic impoverishment and political authoritarianism.” - Ryan McMaken “Practically all government attempts to redistribute wealth and income tend to smother productive incentives and lead toward general impoverishment.” - Henry Hazlitt "Socialism in Russia has not brought about an improvement in the conditions of the average man which can be compared with the improvement of conditions, during the same period, in the United States." - Ludwig von Mises Socialism is based on envy and theft. “The whole gospel of Karl Marx can be summed up in a single sentence: Hate the man who is better off than you are. Never under any circumstances admit that his success may be due to his own efforts, to the productive contribution he has made to the whole community. Always attribute his success to the exploitation, the cheating, the more or less open robbery of others. Never under any circumstances admit that your own failure may be owing to your own weakness, or that the failure of anyone else may be due to his own defects - his laziness, incompetence, improvidence, or stupidity.” - Henry Hazlitt “The envious are more likely to be mollified by seeing others deprived of some advantage than by gaining it for themselves. It is not what they lack that chiefly troubles them, but what others have.” - Henry Hazlitt “The envious are not satisfied with equality; they secretly yearn for superiority and revenge. In the French Revolution of 1848, a woman coal-heaver is said to have remarked to a richly dressed lady: 'Yes, madam, everything's going to be equal now; I shall go in silks and you'll carry coal.'” - Henry Hazlitt “What pushes the masses into the camp of socialism is, even more than the illusion that socialism will make them richer, the expectation that it will curb all those who are better than they themselves are.” - Ludwig Von Mises “The masses do not like those who surpass them in any regard. The average man envies and hates those who are different.” - Ludwig Von Mises "There are people in need of help. Charity is one of the nobler human motivations. The act of reaching into one's own pockets to help a fellow man in need is praiseworthy and laudable. Reaching into someone else's pocket is despicable and worthy of condemnation." - Walter Williams "Three-fifths to two-thirds of the federal budget consists of taking property from one American and giving it to another. Were a private person to do the same thing, we'd call it theft. When government does it, we euphemistically call it income redistribution, but that's exactly what thieves do - redistribute income. Income redistribution not only betrays the founders' vision, it's a sin in the eyes of God." - Walter Williams Socialism is oppressive and destructive. “Socialism crushes human rights, builds the state, impinges on the liberty of conscience, and breeds social, cultural, and economic degeneration.” - Lew Rockwell “The champions of socialism call themselves progressives, but they recommend a system which is characterized by rigid observance of routine and by a resistance to every kind of improvement. They call themselves liberals, but they are intent upon abolishing liberty. They call themselves democrats, but they yearn for dictatorship. They call themselves revolutionaries, but they want to make the government omnipotent. They promise the blessings of the Garden of Eden, but they plan to transform the world into a gigantic post office. Every man but one a subordinate clerk in a bureau.” - Ludwig Von Mises “Every socialist is a disguised dictator.” - Ludwig Von Mises “Socialism is not in the least what it pretends to be. It is not the pioneer of a better and finer world, but the spoiler of what thousands of years of civilization have created. It does not build, it destroys. For destruction is the essence of it. It produces nothing, it only consumes what the social order based on private ownership in the means of production has created.” - Ludwig Von Mises “A society that chooses between capitalism and socialism does not choose between two social systems; it chooses between social cooperation and the disintegration of society. Socialism is not an alternative to capitalism; it is an alternative to any system under which men can live as human beings.” - Ludwig Von Mises “[Socialistic] economic planning, regulation, and intervention pave the way to totalitarianism by building a power structure that will inevitably be seized by the most power-hungry and unscrupulous.” - Friedrich August von Hayek “Friedrich Hayek made the point that one of the keystones of socialism is the denial of individual responsibility. Thus, the crusade for socialism always included attacks on individual responsibility. For if individuals do not have free will, and are not responsible for their actions, then their lives must be controlled somehow - preferably by the state - according to the socialists. They must be regulated, regimented and controlled - for their own good.” - Thomas DiLoroenzo "That democratic socialism, the great utopia of the last few generations, is not only unachievable, but that to strive for it produces something so utterly different that few of those who wish it would be prepared to accept the consequences, many will not believe until the connection has been laid bare in all its aspects." - Friedrich August von Hayek "To the masses, the catchwords of Socialism sound so enticing... so they will continue to work for Socialism, helping thereby to bring about the inevitable decline of the civilization which the nations of the West have taken thousands of years to build up."- Ludwig von Mises "Aggressors cannot wage total war without introducing Socialism." - Ludwig von Mises "Taxes are necessary. But the system of discriminatory taxation universally accepted under the misleading name of progressive taxation of income and inheritance is not a mode of taxation. It is rather a mode of disguised expropriation of the successful capitalists and entrepreneurs." - Ludwig von Mises Socialism is a cheap, easy, and deceptive way for politicians to get votes. “The American politician, without troubling his pragmatic mind with the meaning of words, has discovered socialism- and embraced it- not as a great system of social organization, but as a wondrous machine for the purpose of buying votes.” - John T. Flynn "The main propaganda trick of supporters of the allegedly "progressive" policy of government control is to blame capitalism for all that is unsatisfactory in present-day conditions and to extol the blessings of socialism. They have never attempted to prove their fallacious dogmas, all they did was to call their adversaries names and cast suspicion upon their motives. And, unfortunately, the average citizen cannot see through these stratagems. The liars must be afraid of the truth and are therefore driven to suppress its pronouncement." - Ludwig von Mises Capitalism is superior to Socialism “A society that chooses between capitalism and socialism does not choose between two social systems; it chooses between social cooperation and the disintegration of society. Socialism is not an alternative to capitalism; it is an alternative to any system under which men can live as human beings.” - Ludwig Von Mises “Capitalism means free enterprise, sovereignty of the consumers in economic matters, and sovereignty of the voters in political matters. Socialism means full government control of every sphere of the individuals life and the unrestricted supremacy of the government in its capacity as central board of production.” - Ludwig Von Mises “Capitalism and socialism are two distinct patterns of social organization. Private control of the means of production and public control are contradictory notions and not merely contrary notions. There is no such thing as a mixed economy, a system that would stand midway between capitalism and socialism.” - Ludwig Von Mises “All people, however fanatical they may be in their zeal to disparage and to fight capitalism, implicitly pay homage to it by passionately clamoring for the products it turns out” ― Ludwig von Mises "Capitalism is essentially a system of mass production for the satisfaction of the needs of the masses. It pours a horn of plenty upon the common man. It has raised the average standard of living to a height never dreamed of in earlier ages. It has made accessible to millions of people enjoyments which a few generations ago were only within the reach of a small élite." - Ludwig von Mises "Big business always serves - directly or indirectly - the masses".- Ludwig von Mises "Capitalism is not only a better form of organizing human activity than any deliberate design, any attempt to organize it to satisfy particular preferences, to aim at what people regard as beautiful or pleasant order, but it is also the indispensable condition for just keeping that population alive which exists already in the world. I regard the preservation of what is known as the capitalist system, of the system of free markets and the private ownership of the means of production, as an essential condition of the very survival of mankind." - Friedrich August von Hayek "Despite the miracles of capitalism, it doesn't do well in popularity polls. One of the reasons is that capitalism is always evaluated against the non-existent, non-realizable utopias of socialism or communism. Any earthly system, when compared to a Utopia, will pale in comparison. But for the ordinary person, capitalism, with all of its warts, is superior to any system yet devised to deal with our everyday needs and desires." - Walter Williams "Capitalism is not an 'ism.' It is closer to being the opposite of an 'ism,' because it is simply the freedom of ordinary people to make whatever economic transactions they can mutually agree to." - Thomas Sowell "Prior to capitalism, the way people amassed great wealth was by looting, plundering and enslaving their fellow man. Capitalism made it possible to become wealthy by serving your fellow man." - Walter Williams "Capitalism, and capitalism alone, has rescued the human race from degrading poverty, rampant sickness and early death." - Lew Rockwell “It’s true: greed has had a very bad press. I frankly don’t see anything wrong with greed. I think that the people who are always attacking greed would be more consistent with their position if they refused their next salary increase. I don’t see even the most Left-Wing scholar in this country scornfully burning his salary check." - Murray Rothbard "There is but one means available to improve the material conditions of mankind: to accelerate the growth of capital accumulated as against the growth in population. The greater the amount of capital invested per head of the worker, the more and better goods can be produced and consumed. This is what capitalism, the much abused profit system, has brought about and brings about daily anew. Yet, most present-day governments and political parties are eager to destroy this system." - Ludwig von Mises "The free market is not a dog-eat-dog economy. It is a dog-serve-master economy where the master is the consumer" - Gary North "The real bosses, in the capitalist system of market economy, are the consumers."- Ludwig von Mises "If one rejects laissez faire on account of mans fallibility and moral weakness, one must for the same reason also reject every kind of government action." - Ludwig von Mises "The issue is always the same: the government or the market. There is no third solution." - Ludwig von Mises "The free market is not a dog-eat-dog economy. It is a dog-serve-master economy where the master is the consumer" - Gary North "The real bosses, in the capitalist system of market economy, are the consumers."- Ludwig von Mises "Any man who is only an economist is unlikely to be a good one." - Friedrich August von Hayek "If socialists understood economics, they wouldn't be socialist." - Friedrich August von Hayek "Capitalism has been called a system of greed—yet it is the system that raised the standard of living of its poorest citizens to heights no collectivist system has ever begun to equal, and no tribal gang can conceive of." —Ayn Rand === The Minimum Wage Should Be $0.00 Today’s politicians promise free this and free that. They guarantee their listeners that once they get elected they will all be living in a utopian society. These low IQed politicians and their thoughtless followers are advocating a minimum wage of $15.00. Promising a minimum wage is a cheap, easy, and deceitful way of getting votes from the gullible public. These folks do not seem to understand that the laws of economics are immutable and that economics is a science like any other science. But unfortunately, people have a biased view of economics as Henry Hazlitt wrote in his book Economics in One Lesson: The Shortest and Surest Way to Understand Basic Economics (1946): Economics is haunted by more fallacies than any other study known to man. This is no accident. The inherent difficulties of the subject would be great enough in any case, but they are multiplied a thousandfold by a factor that is insignificant in, say, physics, mathematics, or medicine — the special pleading of selfish interests. The minimum wage, however, has always been harmful to the economy for many reasons. We need to take a sober non-emotional look at the minimum wage and its effects. The Effects of the Minimum Wage Are Always Negative First and foremost, the minimum wage ignores the most basic law of economics, that is economic policies need to consider the long term results on the society at large not just one small group of people. Again, Henry Hazlitt wrote: The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups. The problem with supporters of the minimum wage law is that they only focus on one group of people and ignore the effects on the population at large, especially the consumer. If Walmart, for example, has to pay $15 an hour to their employees, then it will hire fewer workers and raise its prices of its products. So unemployment will go up. It will be harder for entry level workers with no skills to get a job and gain experience. Also, the consumer, which is everybody including the recipient of the minimum wage, will suffer by having to pay more for products or services because the cost of production and services will go up. This cost is naturally passed on to the consumer. The consumer will then buy fewer products. Advocates of the minimum wage are only focusing on one small group of people, namely the recipient of the minimum wage, and ignoring the larger consequences. Every Business Deal is a Mutual Agreement Next, consider the fact that every business deal is a mutual agreement between two parties, unless of course one of the parties is forced into it. In the case of wages the employer and employee should be free to work out what the earnings are for the employee. No business transaction is ideal for either party. Ideally, the employer would like to hire people, have them work twenty hours a day and pay them nothing. This would be the most beneficial scenario for the employer. Ideally, the employee would like to sit around all day and make a million dollars an hour. Neither of these extremes is realistic so they come to a compromise. The employee comes down and the employer goes up until they reach a mutual agreement on wages and working conditions. Neither the employer or employee is 100% satisfied. They compromise willingly. The employee is not a slave. He is free to go somewhere else to work if he is not satisfied with his earnings. This agreed upon wage determines the value of the job. It makes no sense to pay someone $100 an hour to push a broom. Therefore the government should not set a minimum wage, but instead should allow the two adult parties, employer and employee, to come to a mutual agreement. The Minimum Wage is Immoral Another problem with the minimum wage is it is immoral for the government to interfere with the employer/employee business relationship. As Murray Rothbard wrote about Nixon in a 1971 New York Times editorial: "The first challenge to hurl at our Caesar in the White House (Nixon) is not economic but moral: quo warranto? By what right do you use coercion to tell buyers and sellers what prices they may or may not agree upon, or employers and workers what wages they may pay? If two kids are swapping baseball cards, and they decide to swap two Hank Aarons for one Willie Stargell, by what right does a government step in and force the kids to exchange those cards at one for one or whatever other "price" the government in its wisdom deems proper? By what moral right, and by what constitutional right? What possible stretch of the Constitution gives the President the right to freeze rents in a Sioux City boarding house?" The government has no right to tell two adult parties, employer and employee, what the wages should be. The employer and employee should be allowed to work out a deal without any interference from a third party. The Minimum Wage Kills Jobs and Drives Up Unemployment The minimum wage sends more jobs overseas where the cost of production is cheaper. It also has the effect of driving up inflation. So the minimum wage has negative consequences all around. If a business is going to pay an employee a “living wage” of $15.00 an hour, why stop there? Why shouldn’t the government mandate they pay a “high on the hog” wage of $150.00 an hour? The reasons that they don’t is obvious. If McDonald’s had to pay their employees $150 an hour they would only have one or two people working at each restaurant and the price of a hamburger would be around $100. Murray Rothbard wrote in a December 1988 article: In truth, there is only one way to regard a minimum wage law: it is compulsory unemployment, period. The law says: it is illegal, and therefore criminal, for anyone to hire anyone else below the level of X dollars an hour. This means, plainly and simply, that a large number of free and voluntary wage contracts are now outlawed and hence that there will be a large amount of unemployment. Remember that the minimum wage law provides no jobs; it only outlaws them; and outlawed jobs are the inevitable result. All demand curves are falling, and the demand for hiring labor is no exception. Hence, laws that prohibit employment at any wage that is relevant to the market (a minimum wage of 10 cents an hour would have little or no impact) must result in outlawing employment and hence causing unemployment. If the minimum wage is, in short, raised from $3.35 to $4.55 an hour, the consequence is to disemploy, permanently, those who would have been hired at rates in between these two rates. Since the demand curve for any sort of labor (as for any factor of production) is set by the perceived marginal productivity of that labor, this means that the people who will be disemployed and devastated by this prohibition will be precisely the “marginal” (lowest wage) workers, e.g. blacks and teenagers, the very workers whom the advocates of the minimum wage are claiming to foster and protect. The advocates of the minimum wage and its periodic boosting reply that all this is scare talk and that minimum wage rates do not and never have caused any unemployment. The proper riposte is to raise them one better; all right, if the minimum wage is such a wonderful anti-poverty measure, and can have no unemployment-raising effects, why are you such pikers? Why you are helping the working poor by such piddling amounts? Why stop at $4.55 an hour? Why not $10 an hour? $100? $1,000? It is obvious that the minimum wage advocates do not pursue their own logic, because if they push it to such heights, virtually the entire labor force will be disemployed. In short, you can have as much unemployment as you want, simply by pushing the legally minimum wage high enough. Assigning a Higher Dollar Amount to a Job Does Not Increase the Value of That Job. Wealth cannot be created by simply printing money and handing it out. If this were the case, all the government would have to do to prevent poverty would be to hand out money to the whole world. The value of a job cannot be increased simply by paying the employee more money. The value of a job depends on how much demand there is for the product or service the job is helping to create. Money is not an objective measure of the value of the job. Arbitrarily assigning a higher dollar amount to a job does not increase its value. Conclusion In conclusion,there should be no minimum wage law because it immoral for a third party (the government) to interfere with two adults making a business deal.The minimum wage simply increases the cost of production which is passed onto the consumer. Minimum wage laws are bad for the economy as a whole as they drive up unemployment. In the words of Murray Rothbard, “Remember that the minimum wage law provides no jobs; it only outlaws them; and outlawed jobs are the inevitable result.” Summary 1. Promising a minimum wage is a cheap, easy, and deceitful way for politicians to get votes from the gullible public. 2. The laws of economics are immutable. Economics is a science like any other science. 3. Every business deal is a mutual agreement between two or more parties. It is never ideal for either party. 4. The employee is not a slave. He his free to look for another job. 5. The minimum wage only focuses on one group of people and ignores the long term effects on all groups of people. 6. The minimum wage is immoral because no third party has a right to interfere with the employer/employee business relationship. 7. The minimum wage raises the cost of production which is then passed on to the consumer, which is everybody including the recipient of the minimum wage. 8. Assigning a higher dollar amount to a job does not increase the value of that job. 9. The minimum wage destroys jobs, increases unemployment, and sends jobs overseas. 10. Wealth cannot be created by simply printing money and handing it out. . . |
Videos
Austrian Economics Who Does The $15 Minimum Wage Help? Is Capitalism Moral? If You Hate Poverty, You Should Love Capitalism Why Capitalism Works As The Rich Get Richer, The Poor Get Richer The Promise of Free Enterprise Socialism Makes People Selfish Austrian Economics versus Mainstream Economics An Austrian Critique of Mainstream Economics An Introduction to Austrian Economics Articles Capitalism The First Economics Lesson The Myth of the Failure of Capitalism Capitalism Is About Working Less to Earn More Warren Harding and the Forgotten Depression of 1920 Socialism The Dirty Secrets of Socialism A Serial Killer Called "Socialism" Civil Liberties and Socialism Don’t Mix Socialism and 'Social' Justice Why Politicians Win (and Workers Lose) Under Socialism Why Do Half-Measures Work for Markets, But Not for Socialism? Why the Left Refuses to Talk About Venezuela Is There Room for Compromise with Socialism? "Green” Socialism is Still Socialism Jordan Peterson Addresses Socialist Intellectuals (video) Venezuela Runs Out of Toilet Paper, Achieves True Socialism Venezuela: Poster Child for Socialism Two Simple Questions Keynesians Can't Answer Socialism: Armed Robbery and Murder Based on Delusion and Profound Ignorance Two Reasons Why Socialism Repeatedly Fails Wage and Price Control Outlawing Jobs: The Minimum Wage Bernie Sanders and the $15 Minimum Wage Delusion The Minimum Wage Doesn’t Do What You Think It Does Rent Control and Minimum Wage Laws Harm Those Who Are Supposed to Benefit Why do Leftists Settle for a $15 per Hour Minimum Wage? The President's Economic Betrayal Eliminate the Minimum Wage The Feds Move Closer to a $15 Minimum Wage How Minimum Wage Laws Increase Poverty Three Ways to Increase Workers' Wages Three Bad Arguments for the Minimum Wage Upcoming State Minimum Wage Increases Will Outlaw Jobs for Low-Wage Workers Books Books to Start With The Problem with Socialism by Thomas DiLorenzo Economics in One Lesson: The Shortest and Surest Way to Understand Basic Economics by Henry Hazlitt The Case Against Socialism by Rand Paul What Has Government Done to Our Money? by Murray N. Rothbard A Capitalist Manifesto: Understanding The Market Economy And Defending Liberty by Gary Wolfram End The Fed by Ron Paul Socialism The Problem with Socialism by Thomas DiLorenzo The Case Against Socialism by Rand Paul The Politically Incorrect Guide to Socialism by Kevin D Williamson The Fatal Conceit: The Errors of Socialism by F. A. Hayek Socialism: An Economic and Sociological Analysis by Ludwig von Mises The Federal Reserve The Case Against the Fed by Murray Rothbard End The Fed by Ron Paul The Creature from Jekyll Island: A Second Look at the Federal Reserve by G. Edward Griffin Fed Up: An Insider's Take on Why the Federal Reserve is Bad for America by Danielle DiMartino Booth More Books How Capitalism Saved America: The Untold History of Our Country, from the Pilgrims to the Present by Thomas J. Dilorenzo The Fatal Conceit: The Errors of Socialism by F. A. Hayek End The Fed by Ron Paul Economics in Three Lessons and One Hundred Economics Laws: Two Works in One Volume by Hunter Lewis The Politically Incorrect Guide to Socialism by Kevin D Williamson The Politically Incorrect Guide to Capitalism by Robert P. Murphy The Politically Incorrect Guide to the Great Depression and the New Deal by Robert Murphy Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse by Thomas E. Woods Socialism: An Economic and Sociological Analysis by Ludwig von Mises The Road to Serfdom by F. A. Hayek The Anti-Capitalistic Mentality by Ludwig von Mises Human Action: A Treatise On Economics by Ludwig Von Mises What Has Government Done to Our Money? by Murray N. Rothbard Man, Economy, and State with Power and Market by Murray N. Rothbard America's Great Depression by Murray N. Rothbard The Great Deformation: The Corruption of Capitalism in Americaby David A. Stockman The Wealth of Nations by Adam Smith Mises on Money by Gary North (free ebook) ---- AUTHORS Thomas J. DiLorenzo Ron Paul Lew Rockwell Thomas E. Woods Murray Rothbard Walter E. Williams Books at Mises Top Dozen Books on Austrian Economics . |