What's Wrong with Socialism?

[bombus]

Everyone agrees this is an extremely hypothetical thread, right? Not that I'm objecting, but anybody who thinks we're headed towards socialism under an Obama administration, either in stark terror or in gleeful anticipation, is just deluding themselves, IMO.

 

Totally agree with that.

 

However, total Socialism doesn't work in my opinion, as people en mass are greedy and selfish and the idea of 'working for the good of society' doesn't sustain most people for very long.

 

A degree of socialism however, such as has existed in many democratic western European states, can work very well.

 

I think the 'arteries' of society should be run by Government for the people (not for profit) - e.g. energy production and distribution, road and rail systems, healthcare, education, security forces (and maybe the banking system!).

 

The rest is better catered for by market forces.

 

I have a friend who lives in France, and he says that under their system you are paying for somebody to be a couch potato.

 

well, it's probably cheaper than dealing with the crime that would exist without 'welfare'.

[waitforufo]

well, it's probably cheaper than dealing with the crime that would exist without 'welfare'.

 

So the purpose of government is to pay people not to rob us?

[iNow]

So the purpose of government is to pay people not to rob us?

 

I believe this tangent would take us far off topic, and I humbly request that you two open a new thread or discuss via PM.

 

This thread is about the pros and cons of socialism, as expressly indicated in the OP. If we wish to discuss mixed economies and which "blend" works best, that's fine, but the "purpose of government" discussion needs to happen elsewhere.

 

Thanks for respecting the above. Tell me where to shove it if you think I'm out of line.

[Realitycheck]

I have a friend who lives in France, and he says that under their system you are paying for somebody to be a couch potato.

 

Latest unemployment figure in France is around 7.2%, down from 8.6 in recent couple of years and as high as 12 before that. They had a massive influx of refugees but have handled the crisis quite well, creating lots of jobs out of thin air.

 

I almost joined the French Foreign Legion, but my dad talked me out of it.

[dichotomy]

Good socialism =

Propping up irresponsible banks with public funds, banks that caused the current economic crisis.

 

Bad socialism =

Not giving dumb banks public funds to continue operating.

 

 

Corporate welfare! Blahh

 

In all honesty though, in many nations, socialism has been operating alongside capitalism for many years now. Volunteers, social security payments, union protection, public hospitals, public transport, public utilities, public toilets, public swimming pools, public schools…..

 

It is obviously a sign of a healthy growing community when the two systems are used effectively together.

 

I'll take a self motivator over a yes-man any day.

 

The only problem is that self motivator's bruise egos higher up in the pecking order. Hence the preference for yes men, of whom many actually are undercover self motivators ready to move in when the big egos fall.

Edited October 24, 2008 by dichotomy

[Mr Skeptic]

Well now I'm not sure how progressive that is when the rate is flat. That's the part that smells. If my capital gain was say, 200 dollars after all of my expenses, and someone else's gain is 200 million dollars, then the same percentage rate seems fair. But passing judgement on that 200 million dollars and subjectively concluding that it's so much money we should tax an even higher percentage is bullshit. Capital gain is capital gain, if it's good for the uber-rich, then it's good for me. Otherwise it's class warfare. And makes us thugs.

 

Incidentally, I like that assessment, and I'm guessing that's the overall intent of our income tax code, but I'd rather do that in a way that doesn't involve sharing personal information with the government and eyeballing all of my private financial life.

 

Actually, I don't know either. I'll run some numbers through it. I'll assume a level of $10,000 to be the amount that people need to live, and various flat tax rates on the profit.

         | Income
Tax Rate  |  5,000    | 10,000   |  20,000  |50,000  | 100,000  | 1,000,000 |
----------+-----------+----------+----------+--------+----------+-----------+
25 %      |  -25%     |      0   | 12.5%    |   20%  |   22.5%  |   24.75%  |
50 %      |  -50%     |      0   |  25%     |   40%  |   45.5%  |   49.5%   |
90 %      |  -90%     |      0   |  45%     |   72%  |   81%    |  89.1%    |

 

That system definitely looks much flatter than ours. People rapidly get to paying the full tax as they get farther away from the 10,000 mark, already paying half the maximum rate when they make 20,000. The reason I put people earing 5,000 as paying negative taxes is because they could be considered to have losses (negative profits), and the taxes on the negative profits would be negative at a flat rate. However, they would probably get more help than that (we don't let our people starve, do we?).

Edited October 24, 2008 by Mr Skeptic

[ParanoiA]

Hmm, I'm apparently misunderstanding you. I was assuming a consistent flat tax rate, like say 30%. Then just subtract the 10,000 in expenses (which would be different for each person since we're taxing capital gain only) from income, and whatever is left over, no matter how much, gets taxed at that 30%.

 

I wasn't getting this progressive impression from your post #23. I thought you were just talking about determing profit like any business would, and then taxing it at a flat rate. I like that.

[Mr Skeptic]

I think you understood me fine the first time. What I did in the table was exactly what you said, subtract 10,000 from the income and apply a flat tax rate to it. I did this for three different flat tax rates, of 25%, 50%, and 90%. The table shows what the tax rate would look like if it was applied as an income tax (ie, the taxes they would pay, as a percentage of their income) if the flat tax rate on the left is applied to [income - $10,000].

 

I think that the higher tax rate makes it look like a more progressive tax, which is why I included several possible flat tax rates.

 

I used a number of $10,000 as an estimate of the cost of living. It would probably be impractical to try to keep track of the exact value, and would also be a violation of privacy if it had to be reported, hence an estimate.

[ParanoiA]

I think you understood me fine the first time. What I did in the table was exactly what you said, subtract 10,000 from the income and apply a flat tax rate to it. I did this for three different flat tax rates, of 25%, 50%, and 90%. The table shows what the tax rate would look like if it was applied as an income tax (ie, the taxes they would pay, as a percentage of their income) if the flat tax rate on the left is applied to [income - $10,000].

 

I think that the higher tax rate makes it look like a more progressive tax, which is why I included several possible flat tax rates.

 

I used a number of $10,000 as an estimate of the cost of living. It would probably be impractical to try to keep track of the exact value, and would also be a violation of privacy if it had to be reported, hence an estimate.

 

Oh, ok, I was missing the point of the percentages under each income range. I thought you were arbitrarily raising the tax rate, it didn't dawn on me that they were an expression of the 10,000 subtracted from the total.

 

Anyway, I can understand the temptation to use a constant number for cost of living, and the pragmatism, but it ruins the principle of only taxing capital gain. Some poor folks may have more money going out than other poor folks - not just disparity between the classes.

 

I'd like to think that Joe Blow could make the same as me, yet have a lower tax rate because he's got a kid in college, an energy inefficient home, and leftover debt from a failed business venture - all of which lowers his capital gain in comparison to me.

 

So, I don't know. Cost of living is not a fair enough metric to assess capital gain, in my opinion, as many other things can qualify as a loss yet not be necessary for "living". And then, like you mentioned, the alternative is right back to sharing all of this private information.

 

I think this is why I always come back to a national sales tax. Necessities like food, shelter, clothing being exempt, while everything else gets taxed. This really helps the poor since the bulk of their money goes to necessities, and makes a principled statement that we will not tax the citizenry for needs, but wants. Wants implies disposable income, a "gain" per say since you have more capital than what is required to sustain. It's still far from perfect, but it would allow a reasonable enough method of interpreting gain without all the privacy concerns, IRS empoyees, college degrees on a tax code...etc.

[Mr Skeptic]

A sales tax only would be an excellent solution. You could have no taxes on basic necessities, and only tax luxuries. You could also make some finer adjustments, like a lower tax rate for things that border between basic necessities and luxuries (eg a fine steak, or even a low-end computer). A higher or lower tax on things could be used to decrease or increase the use of something (eg higher tax on incandescents, lower or even negative tax on solar panels), which I think is a superior solution than bans and subsidies.

 

One possible problem with sales tax is that then every item would have to somehow be classified as to how much it will be taxed. Another thing is that all states would have to agree on this, or you would get inter-state shopping. (Also, I get my gas tax-free at an Indian reservation. I could also get tax-free cigarettes there if I smoked). The sales tax would also result in a large expansion of the black market, especially if it was a high tax. The government would not approve of losing valuable information (who works for who, and how much they earn) that does have some legitimate uses like finding illegal activities. Another potential problem is that people don't pay taxes unless they buy stuff in the US. This makes vacations tax-free, which is very bad from a macroeconomics perspective (vacations are a type of import). After a while, these problems do add up.

[ParanoiA]

A sales tax only would be an excellent solution. You could have no taxes on basic necessities, and only tax luxuries. You could also make some finer adjustments, like a lower tax rate for things that border between basic necessities and luxuries (eg a fine steak, or even a low-end computer). A higher or lower tax on things could be used to decrease or increase the use of something (eg higher tax on incandescents, lower or even negative tax on solar panels), which I think is a superior solution than bans and subsidies.

 

One possible problem with sales tax is that then every item would have to somehow be classified as to how much it will be taxed. Another thing is that all states would have to agree on this, or you would get inter-state shopping. (Also, I get my gas tax-free at an Indian reservation. I could also get tax-free cigarettes there if I smoked). The sales tax would also result in a large expansion of the black market, especially if it was a high tax. The government would not approve of losing valuable information (who works for who, and how much they earn) that does have some legitimate uses like finding illegal activities. Another potential problem is that people don't pay taxes unless they buy stuff in the US. This makes vacations tax-free, which is very bad from a macroeconomics perspective (vacations are a type of import). After a while, these problems do add up.

 

It does sound like a better set of problems; it solves more than it creates, from my perspective anyway. To most, maybe not. I'm not sure people are all that concerned about sharing their entire private lives with the government or anything else really about the income tax process. They complain, but it sounds empty, like talking about the weather in an awkward silence.

 

Interesting stuff. Didn't we have a thread on the sales tax debate? I might look for that later, and see where we ended it.

[Pangloss]

Try here:

http://www.scienceforums.net/forum/showthread.php?t=35878

[waitforufo]

iNow began this topic by asking "what's wrong with socialism" and is socialism "inherently bad" as it is often described or implied.

 

ParanoiA suggests that the coercive altruism of socialism produces an indifference to societal problems. Societal problems are no longer personal but governmental.

 

(iNow and ParanoiA, please correct me if I am not paraphrasing you incorrectly.)

 

I believe the point ParanoiA is making is in the same vain as my own. Socialism seems to break the natural order of human relationships and human community. Instead of binding us closer together, as it is intended, it seems to make us, at best indifferent, and at worst mistrustful. If this is indeed the case, then Socialism is inherently bad.

 

If Socialism does indeed produce the results I mention above, a good question to ask would be why? I have argued that it has to do with some basic aspect of human nature. Government cannot undo millions of years of evolution by enacting a law. Asking humans to live under socialism is then akin to expecting a fresh water fish to live in saltwater. Attempting to do so would be inherently bad.

 

Finally, in this topic there has been a discussion of the degree of Socialism, with the maximum being 100%. I have engaged in this myself. I think however its wrong to describe all forms of government provided altruism as a degree or percentage of Socialism. Such descriptions, in my opinion, are done simply for convenience.

Edited October 24, 2008 by waitforufo

[npts2020]

One of the things I find interesting in this discussion, is the notion that socialism consists of "subsidizing the poor". On the face it is probably true, the notion that you should help someone less fortunate than yourself is socialist. However, who here is willing to argue that one should exploit that less fortunate individual to the maximum extent possible in order to enrich themselves, which is the logical extreme of capitalism? The main argument for socialism is that every human has some rights; food, water, shelter, basic medical care, opportunity for betterment, etc. The main argument against socialism seems to be that somehow everybody is going to be equal and able to live in exactly the same manner regardless of ability to contribute, not at all what it is about in my opinion. What socialism would do is guarantee some minimal level of existence for any citizen. We can argue about what minimal level is acceptable but I doubt many people would say that no help needs to be given to anyone. Personally I have no problem with the government helping anyone for a short period of time but those asking for longer term help need to have more government intervention in their personal lives in order to solve the problems. In order to recieve long term help, people should not be allowed to continue living in the same manner with only a vague hope that they will somehow change and this type of socialism should be soundly rejected. Long term recipients should be doing schooling for a not only a productive occupation but also things like hygiene, nutrition, personal finances, and interpersonal relationship skills. They should also be undergoing psychiatric evaluation and drug or alcohol counseling if those factors have bearing on their condition. Recipients should not be doing things like taking drugs or alcohol, living above a subsistance lifestyle, having more babies, and engaging in nonproductive activities. These lists are not meant to be comprehensive but only to give an idea of some of the considerations for any sort of socialist program and a general idea of the form of socialism that I think could be positive for the vast majority of us. I will climb off the soapbox now and leave it for the next person.

[dichotomy]

However, who here is willing to argue that one should exploit that less fortunate individual to the maximum extent possible in order to enrich themselves, which is the logical extreme of capitalism?

 

This isn’t an extreme, it’s a reality. All people are exploited to their individual maximal extent. When people reach beyond their maximal extent they stop work or get sick, or both. Parents are exploited by children, children by parents, workers by bosses, bosses by workers, husbands by wives; we even exploit our selves until we can no longer operate. Capitalism, socialism, whatever, they are simply dumb labels with the same outcome: someone is exploiting someone else in order to survive the best way they can.

 

A sales tax only would be an excellent solution. You could have no taxes on basic necessities, and only tax luxuries.

 

Oh boy, in Australia we got our supposed basic necessities (e.g. food) taxed at a lower rate, which of course it great, but then there are the inevitable odd political decisions like sanitary pads/ tampons that are considered luxury items?! I think I know a way to get more female votes!

[waitforufo]

Parents are exploited by children, children by parents, workers by bosses, bosses by workers, husbands by wives; we even exploit our selves until we can no longer operate. Capitalism, socialism, whatever, they are simply dumb labels with the same outcome: someone is exploiting someone else in order to survive the best way they can.

 

With such a negative world view, it must be difficult to get up in the morning. I have never considered myself exploited by my offspring, wife, or parents. These people have always been loving and supporting. When my offspring were children and adolescents they needed more support then they do today as young adults, but since I chose to have them, and love them very much, I never felt exploited.

 

Since I, like most, work voluntarily and have changed jobs to suite my own needs, I don't know how such a situation can be called exploitive. (Yes, I do have to work to provide the necessities of life for me and my family.) Employers in a capitalist economy, in my opinion, provide opportunities. I don't see how that would be much different in a Socialist economy. At least in the Socialist economy to which iNow's question is directed.

 

What's wrong with Socialism? In this topic several opinions have been given.

 

1) I produces dependence, not independence

2) It produces mistrust and animosity between members of society.

3) Perhaps it fosters depression in individuals as well.

[iNow]

Everyone does, however, seem to agree that a mixed approach to economy is the best solution. So, how much and in what arenas do we allow socialism, and where should we actively seek to prevent it from being the norm? Someone above mentioned healthcare managed socialistically is good, but consumer electronics managed socialistically is not.

 

Let's explore that part of it. What blend and in what domains would work best as pertains to using a socialistic approach?

[D H]

Everyone agrees this is an extremely hypothetical thread, right? Not that I'm objecting, but anybody who thinks we're headed towards socialism under an Obama administration, either in stark terror or in gleeful anticipation, is just deluding themselves, IMO.

Toward pure socialism, yes, I agree. That a Democratic executive and legislative branch won't make significant steps in that direction, I fully disagree. Whether this change (and that is a big part of Obama's "change") is good or bad is a different question.

 

If my capital gain was say, 200 dollars after all of my expenses, and someone else's gain is 200 million dollars, then the same percentage rate seems fair. But passing judgement on that 200 million dollars and subjectively concluding that it's so much money we should tax an even higher percentage is bullshit.

Why? Your argument is, IMO, overly simplistic. So are arguments from the extreme left that someone who makes 200 million is pure evil and must have that 200 million taxed at a rate 90%, minimum, because anything less would be unfair. What makes your version of fairness the correct one?

 

Ignoring welfare, the person who makes 200 million after expenses receives proportionately much greater benefits from the government that someone who makes 200 dollars after expenses. The person who makes 200 million will have accumulated wealth that is protected from internal strife by local police and from external strife by the military. The person who makes 200 after expenses won't have much accumulated wealth in need of protection. As wealth accumulation obeys a highly non-linear relation with respect to income, if you must tax income then the only way to make it "fair" is to tax income in a progressive manner.

 

There are a lot of problem with the word "fairness", particularly when applied to the tax code. For one thing, "fairness", like beauty, is something that varies with the beholder. For another, any form of taxation is implicitly "unfair" in the sense that it is government-sanctioned robbery. (It is not robbery in the sense that robbery impoverishes everyone but the thief while government expenditure (well, at least some of them) enrich all of us.)

 

I like to look at things from the perspective of minimizing unfairness rather than maximizing fairness. This viewpoint results in a progressive tax code. The pain lower middle class people feels in paying ten percent of their income in the form of taxes is a lot greater than the pain wealthy people would feel if the government took only ten person of their income. Spread the pain evenly requires the rich to pay more. This viewpoint also results in all but the very poorest pay some taxes.

[waitforufo]

Everyone does, however, seem to agree that a mixed approach to economy is the best solution. So, how much and in what arenas do we allow socialism, and where should we actively seek to prevent it from being the norm? Someone above mentioned healthcare managed socialistically is good, but consumer electronics managed socialistically is not.

 

Let's explore that part of it. What blend and in what domains would work best as pertains to using a socialistic approach?

 

Okay I'll play your little game, but perhaps you could give a bit more definition.

 

In a previous post I mentioned that I thought defining all aspects of government altruism as socialistic was simply a convenience. If you take such convenience too far it is just lazy. Let me give a few examples.

 

Fascist in the 30's favored price supports and farm subsidies. They also had significant public works projects. So I ask you, what percentage of Fascism is socialistic? The whole concept seems to be an oxymoron.

 

The Roman Empire provided bread and circuses for its citizens. These benefits were paid for by exploiting conquered peoples and nations. Slavery existing in the Roman Empire to the extent that watching slaves being murdered was considered public entertainment. Can such a system be described as partially socialist?

 

I think if you are not careful, you will decide that all systems are mostly socialist. Regardless of the amount of pubic supported altruism they have, most in fact are not socialistic.

Edited October 27, 2008 by waitforufo

[dichotomy]

With such a negative world view, it must be difficult to get up in the morning.

 

You assume a lot; maybe you have a crystal ball? These sorts of statements always speak more about the originator than the intended person.

 

I have never considered myself exploited by my offspring, wife, or parents. These people have always been loving and supporting. When my offspring were children and adolescents they needed more support then they do today as young adults, but since I chose to have them, and love them very much, I never felt exploited.

 

“Exploitation -

1. The act of employing to the greatest possible advantage: exploitation of copper deposits.”

 

Exploitation can be accepted and even enjoyed. It’s not necessarily “bad”, it’s just how life operates, a truth. Parents are willingly exploited by their children to give them a good start in life. The altruistic are willingly exploited and enjoy it because they believe it’s for the greater good, and it often is. Possibly you think exploitation is something evil that’s done against ones will, or awareness perhaps? We exploit our environment every day, that’s how we survive. There is nothing particularly wrong or depressing about that, unless you are brought up to believe that it is. But then, you’d probably just starve if you truely believed that…

 

“altruism

2. Zoology - Instinctive cooperative behavior that is detrimental to the individual but contributes to the survival of the species.” You see, It's accepted as being part of nature.

 

Since I, like most, work voluntarily and have changed jobs to suite my own needs, I don't know how such a situation can be called exploitive.

.

Well, you're exploiting the opportunities in the job market, and your employer is exploiting your skills. You and your employer are in a constant tug of war to expolit the best from one another. Nothing surprising here...It's just the way you associate the word exploit. And if you think that being a volunteer is somehow not attempting to get a bit of power and prestige, then you are wrong. Many people use it for this purpose, and many others use it to be altruistically and happily exploited.

 

 

 

Combination and fluctuating levels of socialism and capitalism are both vital to successful societies. They both have advantages, and therefore both should be explored and used to exploit these advantages.

 

I personally lean towards socialism, but I don't delude myself that's it's the only effective magic key to grow healthy, flurishing, long term societies. I especially like the ideas and implimentations of public health systems, public transport, and public education. And some of the most attractive things about the western world would collapse without volunteers organising community events.

Edited October 27, 2008 by dichotomy

[waitforufo]

I did not mean to offend you. The word "exploit" in my opinion has pejorative connotations.

[bascule]

Interesting take on this by the New Yorker:

 

http://www.newyorker.com/talk/comment/2008/11/03/081103taco_talk_hertzberg?printable=true

 

As a buzzword, “socialism” had mostly good connotations in most of the world for most of the twentieth century. That’s why the Nazis called themselves national socialists. That’s why the Bolsheviks called their regime the Union of Soviet Socialist Republics, obliging the socialist and social democratic parties of Europe (and America, for what it was worth) to make rescuing the “good name” of socialism one of their central missions. Socialists—one thinks of men like George Orwell, Willy Brandt, and Aneurin Bevan—were among Communism’s most passionate and effective enemies.

 

The United States is a special case. There is a whole shelf of books on the question of why socialism never became a real mass movement here. For decades, the word served mainly as a cudgel with which conservative Republicans beat liberal Democrats about the head.

[Pangloss]

Saying that it's just about Republicans beating up Democrats over it is a dodge. There is very real substance behind the American antipathy towards socialism.

[ParanoiA]

Why? Your argument is' date=' IMO, overly simplistic. So are arguments from the extreme left that someone who makes 200 million is pure evil and must have that 200 million taxed at a rate 90%, minimum, because anything less would be unfair. What makes your version of fairness the correct one?

 

Ignoring welfare, the person who makes 200 million after expenses receives proportionately much greater benefits from the government that someone who makes 200 dollars after expenses. The person who makes 200 million will have accumulated wealth that is protected from internal strife by local police and from external strife by the military. The person who makes 200 after expenses won't have much accumulated wealth in need of protection. As wealth accumulation obeys a highly non-linear relation with respect to income, if you must tax income then the only way to make it "fair" is to tax income in a progressive manner.[/quote']

 

These arguments on who gets the most out of our laws and government services are just silly. For one, I could also make the case that the poor depend on these services more than the rich, since the rich can actually afford for some of these services to fail without impacting their survival and necessities, while someone much closer to the poverty line is highly effected by a small failure in these services, just look at the financial crisis to see that. Some companies went under, but in terms of individuals, the poor and middle class retirements and mortgages are the hardest felt.

 

Also, do we charge the poor more for police services since they get them far more than the rest of us? Police units get called into poor neighborhoods far and away more than rich ones, so again, one class of people disproportionately receive more service than the other. But no one’s making a case they should pay more progressive tax. And they shouldn’t, because this whole exercise is a waste of time. Unless you’re ready to make all taxes usage sensitive…

 

No, my take is simplistic because, one: I castrate the concept of subjectivity as much as humanly possible in governing humans. And two: I believe in an equally invested citizenry. I do not believe it should even be possible to legislate a disproportionate tax burden. It is a crime of common sense to allow the majority of the people to shift the burden to a minority class of people. In theory, we could eventually just shift ALL taxes to the rich. What are they going to do? They’re a minority.

 

And of course, you wouldn’t go into business with someone investing 90% to their 10% but give them equal say would you? Hell no, if one is to have equal say, and in our republic there should be nothing less than that, then you must have equal stake, which means a flat tax rate. My only concession is that it should be applied to capital gain only, as a way to relieve that burden on the poor, an exercise in reducing “unfairness”, you might say.

 

 

There are a lot of problem with the word "fairness"' date=' particularly when applied to the tax code. For one thing, "fairness", like beauty, is something that varies with the beholder. For another, any form of taxation is implicitly "unfair" in the sense that it is government-sanctioned robbery. (It is not robbery in the sense that robbery impoverishes everyone but the thief while government expenditure (well, at least some of them) enrich all of us.)

 

I like to look at things from the perspective of minimizing unfairness rather than maximizing fairness. This viewpoint results in a progressive tax code. The pain lower middle class people feels in paying ten percent of their income in the form of taxes is a lot greater than the pain wealthy people would feel if the government took only ten person of their income. Spread the pain evenly requires the rich to pay more. This viewpoint also results in all but the very poorest pay some taxes.[/quote']

 

I like the notion of minimizing unfairness. I can't say I agree with the progressive nature, as evidenced above, but I agree with the premise. There is no "fair" way to take, really.

Edited October 28, 2008 by ParanoiA

[Saryctos]

The federal gov't should be more of an auditing position. Watching money flows and listening to what people want, then sending their cries for help to the people who can do something about it. Sort of like the largest middle man agency ever.

 

EDIT: federal added and italicized because I wasn't thinking in depth about local and state level with respect to this thread.