Each day brings new proof that Socialism doesn't work

Updated: Aug 20, 2019




Don't have time to read the article? Listen to the audio version on the podcast!






Let's start with the actual definition of "Socialism"




The classic view of socialism is "worker owned" means of production. I've seen people suggest this as a solution for many of America’s large corporations. I've seen things like "They don't need executives," or "If the workers owned the business it wouldn't be this way.."


Here's my honest reply to that ideology.


Okay. Good. Then do it.


I've been in this argument with various Uber drivers before who suggested that the founders of the company actually brought no value to the table- That it was actually the workers that make the business possible. To an extent this is true. Obviously Uber would not be able to give people rides if there were not drivers to perform the task (yet).


"It's not hard to build an app" is the response I would get from time to time.


Once again my response remains- "Okay. Good. Then do it."


Let's say you have an app like Uber that cost a billion dollars to get off the ground. That's obviously a massive initial expense. There had to be someone willing to risk that much money when they started the company. That person probably only risked the money because they expected a return on their risk at some point in the future.


So what about the idea of 'worker ownership' of the company?


The easiest first response is that logistically, that would never work. Who decides the direction of a new program within the company? Who decides what the new logo is going to be? Maybe a democratic vote for every single decision? This will obviously decrease efficiency, and raise the cost of doing business.


So back to the initial answer of "Okay. Good..."


If you think that a worker owned business is the best way to go..If you think that it will obviously have lower prices due to lack of greed in profits... If you think that workers will gravitate towards this business because it's obviously a more suitable work environment.. Then why isn't it happening?


You might hear a response like “Well there’s no way the new SocialistX company could compete..” Okay, so you’re saying the capitalist company is providing goods at cheaper prices than the Socialist company would be able to provide? Hmm.


There's absolutely no laws stopping the 500,000 Uber drivers from banding together to start their own company.

There are no laws stopping the 2 million Walmart employees from joining together to create their worker controlled retail chain.


There are no laws stopping 1.2 million McDonalds employees from starting there own restaurant chain.


Of course, they would each need to throw in $500-$2,000 to build up a billion in capital to get things off the ground, but they all know that they will be better off for the rest of their lives afterwards- so what's stopping them?


What's stopping them is the obvious fact that it's impossible to get that many people to come together and agree on what decisions should be made to grow the company. They all know it's too risky, so they aren't going to put in the time, or capital.


So if it's obvious that it's impossible to start such an endeavor, then what piece is needed to get the business off the ground?


If you guessed "the government," I'd politely refer you to bernielies.com for more information.


For those of you that guessed "An initial investor and company executives," congratulations on having a rational thought process.


In this "chicken or the egg" scenario, we can easily answer which comes first. If you want an entirely worker controlled business, you cannot get it without the initial investor. That's why we focus so much on business taxes and regulations. If you take the part that obviously has to come first, and make it harder, what are the exponential reverberations throughout the economy?




My conclusion remains the same.


If Socialism calls for worker controlled production- there's absolutely no reason to hold off any longer on starting that venture. So why hasn't this been done? Because it's inefficiency leads to higher prices, and a lower standard of living.


The Capitalist model works because it rewards those who risk the initial investment. Which we can obviously see is the necessary first step in creating the means of production. When you go down the road of removing or inhibiting the rewards for risk (profit), you just end up with those who have the most money being the only ones willing to start the businesses. Eventually, you end up with no one at all being willing to take risk, which leaves you living in Venezuela.


The old sarcastic tagline for Socialism comes to mind: "Socialism, an idea so good- it has to be forced at gunpoint."

Listen to the Podcast!

© 2019 Good Morning Liberty 

Created by Paradexo

  • Facebook
  • Twitter
  • YouTube
  • Instagram
  • TikTok

Nashville, TN

email: nate@goodmorningliberty.us