The problem with Socialism


Houses of Parliament (ie Socialism)

An economics professor at a top university made a statement that he had never failed a single student before, but had recently failed an entire class. That class had insisted that Obama’s socialism worked and that no one would be poor and no one would be rich, a great equalizer.

The professor then said, “OK, we will have an experiment in this class on Obama’s plan”.  All grades will be averaged and everyone will receive the same grade so no one will fail and no one will receive an A….  (substituting grades for dollars – something closer to home and more readily understood by all).

After the first test, the grades were averaged and everyone got a B. The students who studied hard were upset and the students who studied little were happy. As the second test rolled around, the students who studied little had studied even less and the ones who studied hard decided they wanted a free ride too so they studied little.

The second test average was a D! No one was happy. When the 3rd test rolled around, the average was an F.

As the tests proceeded, the scores never increased as bickering, blame and name-calling all resulted in hard feelings and no one would study for the benefit of anyone else.

To their great surprise, ALL FAILED and the professor told them that socialism would also ultimately fail because when the reward is great, the effort to succeed is great, but when government takes all the reward away, no one will try or want to succeed. Could not be any simpler than that.

Here are possibly the 5 key points about such an experiment:

1. You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.

2. What one person receives without working for, another person must work for without receiving.

3. The government cannot give to anybody anything that the government does not first take from somebody else.

4. You cannot multiply wealth by dividing it!

5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

Read Friedrich Hayek – The Road To Serfdom.

Follow this blog (by inserting your email address, up on the right, and clicking ‘Click to Follow ’) to receive new posts straight into your In Box.

This entry was posted in Uncategorized. Bookmark the permalink.

49 Responses to The problem with Socialism

  1. Pingback: The problem with the problem with #Socialism » The Soviet Unit

  2. Anonymous says:

    how come the equality based finnish education system is the best in the world and the american is the worst, then?

  3. R. Freiherr v. Wackendonk says:

    Frankly, this experiment is a total failure due to the lack of coercion. At least the professor should have acted as an IRS agent, coercing all students to pay into the system by studying or helping the lazy student cheat on their exams. At most, the professor could go Pol Pot on them and liquidate entire rows of students for nonparticipation in the collective welfare.

    • Anonymous says:

      so, who was the country who aided pol pot then?

      oh – that would be america, dominated by the CFR and kissinger which is funded by the same people who funded von mises, hayek, et al.. funny that.

      as for this incredibly white idea about coercion and the corruption of the word “violence” to mean paying taxes, what did coercion and “violence” mean before the evils of “big government”? slavery and lynchings, perhaps?

  4. Jack says:

    Hayek was delusional.

    Obama is about as “progressive” as Reagan.

    Isn’t it funny, when, the plutocracy and their corporations get into trouble, they then run to Congress/Parliament for handouts? Socialism is just for the wealthy then, eh?

  5. Anonymous says:

    Correction … Houses of Parliament = National Socialism

  6. Anonymous says:

    i live in a very agreeable part of the netherlands and despite being in a long recession, i can assure you that the poor significantly more comfortable than they are in the UK and have been so in much of northern europe for hundreds of years. there are also more millionaires per capita. it is possible to be both more equal and at once more prosperous. i would rather be lost in a dutch “ghetto” than than in the east end of glasgow…

    much has been written about the unusually poor conditions endured by the british working class, have you not read about it?

    • I have and it is a result of socialism and crony capitalism

      • Anonymous says:

        we had some socialism from the end of WW2 until 1979. the east india company’s rape of the world and the irish potato famine holocaust happened under lassiaz faire capitalism.

      • Peter says:

        Then why aren’t the more Socialist Dutch poor even more worse off than the Capitalist British poor?

      • house prices. all in good time, all in good time

      • Anonymous says:

        house prices inflated by neoliberal policies allowing unlimited mortgage tax relief on stylish mansions. if it were socialist, we would be renting council houses.

      • most are – it’s called a mortgage.

        you think they’ll let majority of mortgage holders actually win?

      • Anonymous says:

        of course not. it was a neoliberal plan to get rid of the municipally owned housing stock and sell the “property owning democracy” hallucination to an otherwise financially “small c” conservative people. it started under our own blair – the amusingly named wim kok. here, those you label as “socialists” were dishing out 125% mortgages with no deposit like maniacs. it is madness, but can’t in any way be described as socialism. the social parts of the country – education, railways, bike lanes, water management are world leading and having a decent minimum wage doesn’t make beer and spuds any more expensive.

  7. wakeupbomb says:

    Obamacare isn’t socialism, it’s socialism for rich people, as is the entire United States economic system. I’m not an advocate of socialism either, but it’s better than the outright corporate fascism that we have at present.

    • and the difference to Socialism is what? you think there could ever be socialism without an elite?

      • Anonymous says:

        what about the john lewis model or mondragon? bayern munich is 81% owned by fans, for example. it is a matter of ownership, imo.

        britain, like russia has an embedded heirarchical culture and the rich hate the poor – that is the problem with your elite, left or right.

      • yes, based on a debt fuelled society – you’re so clever you forget the obvious

        i agree the rich hate the poor – which is the very reason why we need capitalism to equalise things. banbankbailouts and prosecutebankgenerals and we would see more equality. not immediately but it would be heading in right direction

      • Anonymous says:

        i agree with capitalism when you can have truly competitive markets – like car production (where unionised workers earn decent livings), but public ownership of natural monopolies like raliways and water. i would also like to see much lower taxes on earned income and consumption and higher taxes on capital gains, rents, wealth and inheritance. i don’t see how your libertarianism sticks it to the aristocracy, slum landlords and trust fund kids, do you?

      • Anonymous says:

        in what country has capitalism, red in tooth and claw ever increased equality over time? the most equal and prosperous countries are the social market orientated nordic countries. there is lots of data on this subject.

      • Anonymous says:

        unpayable debts must be written off – we need a jubilee ASAP. the bondholding vampires can get real jobs and work for a living.

      • Anonymous says:

        john lewis is in a very good financial position as is bayern – the only major football club to buy players from money that it has earned from commercial revenues rather than loans.

  8. Anonymous says:

    obama is not a socialist, just a wooly “progressive” – the only thing he is bringing into the public domain is private debt. as for your education example, how come the equality based finnish public education system is the best in the world AND the has the smallest gap between high and low achievers?

  9. Anonymous says:

    5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

    so let’s ban trust funds and large inheritances then? most of your ideas have been paid for by huge trustafarians like rockefeller and koch.

    also, how come welfare states like norway, iceland, luxembourg and switzerland have such low unemployment when the dole there is far more generous than the UK?

    maybe decent wages?

    • no, norway – oil
      switzerland – banking and billionaires not taking from state
      lux – same
      iceland made a move towards capitalism when it rejected 15 year tax to bail out banks

      • Anonymous says:

        you misunderstand my point – people could sit at home in the dole eating pizza in norway earning more than many full time workers in the UK, yet they choose to work – how come? the banking system and tax exiles may account for some of switzerland’s prosperity, but not to their work ethic – many cantons have consistantly had unemployment rates of below 1% the netherlands has historically had lower levels of unemployment than the UK despite far more generous benefits – how come?

        funny about iceland – i read a von mises institute piece about how great they were doing with deregulation, finincial “innovation” and flat taxes about a year before the crash.

        5 years of turbo charged macho capitalism nearly destroyed the most prosperous and sustainable nation on earth and was ONLY saved by direct democracy – or mob rule, as you might say…

      • just cos von mises lot say something doesn’t mean they’re right. anyone who was clear thnker saw the bubble in iceland banking. See Inside Job oscar winning movie/doc

        no it was not capitalism – it was fraud, when you look at all the originations of the easy money

        the netherlands is in at least as big a bubble as UK

        agree re work ethic of Swiss

      • Anonymous says:

        yeah – goldman sachs and other institutions who fund your favoured “thinkers” got out of iceland with just weeks to spare…

        and your argument that “it wasn’t REAL capitalism” echo the arguments of disgruntled communists “we hadn’t got past state capitalism” – when apart from your glorious 2 years in the 20s has any country had capitalism without it turning into corporatism?

        as for NL – i have payed more taxes towards the mortgage tax relief of people living in glorious art noveau mansions than toward welfare. mortgage tax relief is a neoliberal measure, a socialist measure regarding housing would be to build council houses!

        so how come the swiss et al wish to be in work when they could survive better than a full time english worker without working? maybe it’s good wages???

  10. Anonymous says:

    1. You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.

    yes you can – works in prosperous denmark. the poor get by quite tolerably in scandinavia compared to the UK thanks to collective bargaining and minimum wage laws. they also have a bigger and more prosperous middle class.

    2. What one person receives without working for, another person must work for without receiving

    like rents? inheritance?

    3. The government cannot give to anybody anything that the government does not first take from somebody else.

    like the post office being sold to hedge funds, bailed out banks and bahraini sovereign wealth funds?

    4. You cannot multiply wealth by dividing it!

    better that the rich get exponentially wealthier then?

  11. Anonymous says:

    you like “the 10 cannots” don’t you.

  12. I didn’t say I created it. I got it from some website that won’t care.

    • bernie birnbaum says:

      let’s imagine a class where the student with the highest score receives an A+ and everybody else flunks with an F….. is this a better system? is this the “invisible hand of the market”, crony capitalism, predatory free-market ideology, cartel fascism?

      ….ayn rand, milton friedman, bernie madoff…. oh my.


      • Anonymous says:

        go bernie! don’t forget walter “voluntary slavery” block…

      • it’s where 1 is smarter or works hared than the failures. welcome to the real world

      • Anonymous says:

        i can’t think of anywhere where that works worse than in the UK – the country is run by posh losers – have you seen bullingdon boy, george osbourne’s CV? or ian duncan smith?

        how come the equality based finnish public school system is so much better?

        how come the scandinavian countries are the most socially mobile and the UK and US among the least?

  13. Anonymous says:

    “You couldn’t make it up”
    Oh wait, you did. Ah shucks…

Comments are closed.