EQUITY VERSUS EQUALITY — PART 1 addresses this subject: The Difference Between Equity and Equality. Here we will consider why Socialism does not work.

Socialism Is Destructive Of Productivity

In our society, we own some things individually, and some things we own as a people. Some people have almost nothing. Others own extravagant amounts of wealth. Most of us, however, have enough wealth for our needs. Meanwhile, in our name, our government exercises the ownership of vast tracts of land, buildings, and machinery. What does this suggest to some? Because of the wild variations in the amount of wealth people have, it suggests the right to own property privately is unfair and unjust. Because government already owns large amounts of property (and also heavily regulates the conduct of many businesses) it suggests we already have Socialism; we just don’t have enough Socialism. Since what we own through the government, we all own “equally” (and therefore, “fairly”), to make everything fair we just need our government to take over the ownership of everything else.

The fact a government owns everything, however, is not what defines Socialism. Government ownership of the means of production and distribution defines Socialism. Of course, if government owns everything so it can distribute everything equally, government owns the means of production. So we are in fact talking about Socialism.

What is the problem with government owning everything, including the means of production and distribution? Productivity depends upon tools. If you try to farm the old fashion way using sticks to plow the earth, whatever manure you can collect by hand to use as fertilizer, and depend upon rain to water your crops, you won’t be very productive. On the other hand, if you can afford tractors, chemical fertilizer, irrigation equipment, trucks to move your produce to market — that is, better tools — you can farm more land, increase your yields, and sell what you produce. That, however, requires capital and the willingness to invest that capital carefully. That is what defines Capitalism, and that focus is what makes Capitalist societies more productive than Socialist societies.

In a Socialist society, the people who control the wealth are the leaders. These people know how to maintain power, and maintaining power is their focus. Thus, the leaders of Socialist societies use the wealth they control as a means for maintaining power, not as capital for acquiring more and better tools.

In a Capitalist society, the people who control the wealth are the people who have demonstrated the most capacity to efficiently and effectively acquire it. These people have figured out how to invest their capital to buy the most cost efficient tools, train workers to properly use those tools, produce goods and services people want to buy, and sold the goods and services they produce profitably.  That is why in Capitalist societies people usually have enough to eat, clothes to protect their bodies, and a roof over their heads.

Let’s illustrate the point. Consider the car shown in the video below. Believe it or not, the Trabant shown in the video was made in East Germany in 1981. This was before the Berlin Wall came down, before the government would allow people to buy something decent made outside of the Soviet Bloc. The Trabant was the best the leaders of East Germany, in a land where Capitalists were jailed, could produce for the mass market.


You want to drive a Trabant  to and from work every day? Then vote for people who want you to believe they know how run everything. Vote for people who want to make your life simple by giving you what belongs to someone else. Vote for people who want to make all your choices the right choices because they have made all your choices for you.

Additional References


  1. The appeal of Socialism lies completely on emotions and a cult of personality type leader to deliver the goods. With the vast expansion of the powers of the Executive branch over the last few Presidents, I fear we are in a dangerous position when full blown Socialist finally gets elected President. Good post Tom.


  2. Don’t hate on the Trabant, it was one of the cars that were most sought after and difficult to get! Want a Mercedes? Go to the dealer, put down the cash, it’s yours, you drive off. Want a Ferrari? Go to the dealer, put down the cash, it’s yours, you drive off. You want a bespoke Rolls-Royce? Go to the dealer, order it, put down a deposit and within a year it is yours. Easy. With a Trabant, you applied for the car and started saving money to pay for it (buying on credit was out of the question) and in the 70s the waiting time was 17 years. Don’t even think about ordering two of them, that was VERBOTEN! At the same time, you had more than one in one hundred citizens spying on you. What is not to like about this? Anything you want to complain about, comrade?

    Liked by 1 person

  3. Good choice of mfg product you made to explain comparison of what Communism produced in defective goods.

    Look forward to next to a comparison of what the leaders produced, perhaps.

    Regards and goodwill blogging.

    Liked by 1 person

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