The Equality Act Revealed

 

 

 If enacted into law, the Equality Act would further erode religious liberty, transform public opinion on sexuality, and harm the public perception of those who believe in traditional or biblical sexual morality. The bill would create federal anti-discrimination protections on the basis of sexual orientation and gender identity in public accommodations, education, employment, and housing. To do so, it would amend the 1964 Civil Rights Act to add “sexual orientation” and “gender identity” as protected classes . In short, the Equality Act would offer the same types of protections extended to other groups (on the basis of race, color, religion, and national origin) protected under the Civil Rights Act of 1964.  The Equality Act represents the most invasive threat to religious liberty ever proposed. Were it to pass, its sweeping effects on religious liberty, free speech, and freedom of conscience would be historic.

 The Equality Act promotes inequality because it would penalize Americans for their beliefs about marriage and biological sex.The Equality Act would amend federal civil rights law by adding “sexual orie  ntation” and “gender identity” as protected classes.  In recent years, Heritage Foundation scholars have sounded the alarm about various groups that would be harmed should the act become law, including employers and employees, medical professionals, parents and children, women, and nonprofits and volunteers.

Equally disturbing is the Equality Act’s lack of any conscience protections for individuals with moral or religious objections. Federal law has, for more than 40 years, provided for various conscience-protection provisions for individuals and entities in the context of health care.  Those laws protect, for example, a nurse from having to participate in an abortion procedure or certain health plans from covering elective abortions. Such protections ensure that individuals and entities are not compelled to participate in practices that violate their sincere moral, ethical, or religious convictions. 

 

 

 

 The bill’s stated intentions and its actual consequences are very different. While the bill purports to protect individuals from discrimination, the Equality Act would discriminate against those who do not agree with a regime of laws premised on sexually permissive understandings of human nature that deny sexual complementarity. It would thus create a new form of discrimination by socially isolating certain beliefs.

 Take Peter Vlaming. This high school French teacher was dismissed under the school’s anti-discrimination policy after he refused to comply with administrators’ orders to use a female student’s preferred masculine pronouns. Vlaming had tried to accommodate the student by avoiding pronouns altogether and addressing the student by their preferred masculine name, but this was deemed insufficient by the school board.

 This politicization of medicine would ultimately harm families by normalizing hormonal and surgical interventions for gender dysphoric children as well as ideological “education” in schools and other public venues. Yet activists continue to push their own radical protocol: social transition as young as 4, puberty blocking drugs as young as 9, cross-sex hormones as young as 14, and surgery by 18 (or, in some cases, even younger). This protocol could become mandatory in the future. The latest issue of the American Journal of Bioethics includes an article arguing that the state should overrule the parents of gender dysphoric children who do not consent to giving them puberty-blocking drugs.  In fact, parents in Ohio lost custody of their seventeen-year-old daughter because they declined to put her on testosterone supplements.

The Equality Act would force hospitals and insurers to provide and pay for these therapies against any moral or medical objections. It would politicize medicine by forcing professionals to act against their best medical judgment and provide transition-affirming therapies.  The fight is already here. Catholic hospitals in California and New Jersey have been sued for declining to perform hysterectomies on otherwise healthy women who want to become male. A third Catholic hospital in Washington settled out of court when the ACLU sued them for declining to perform a double mastectomy on a gender dysphoric sixteen-year-old girl.

Sexual orientation and gender identity laws that  open up sex-specific facilities like bathrooms, locker rooms, etc. to members of the opposite sex enable sexual assault. For example, Pascha Thomas was forced to remove her child from school after a male classmate assaulted her five-year-old daughter in the girls’ restroom. The boy had access to the girls’ restroom because the school’s policy that grants students access to private facilities on the basis of self-identified gender identity. Administrators refused to change the policy despite Thomas’ complaints.  The concern with these policies is that predators will take advantage of the law to gain access to victims.  In the United Kingdom, where a similar law is already in place, a male rapist was transferred to a women’s prison because he “identifies” as a woman. Once there, he twice committed sexual assaults.

 

 

 

 

Individuals who support LGBT rights but also recognize that no citizen or institution should be penalized for sincerely held traditional beliefs about marriage, sexuality, and gender should oppose this legislation. Christians who desire the law to resemble the truth about marriage, sexuality, and gender should likewise be opposed. Expansive protections for some that lead to restricted liberties for others do not advance equality or tolerance. Instead, they cause coercion and subjugation.

To safeguard against threats to religious liberty, Senate and House leadership should quash the bill. Granting special rights to others while denying the religious liberty and conscience rights of others is unacceptable. Furthermore, citizens should voice their concerns to their elected officials.

Another Dark Minimum Wage Truth

 

 

 

So, ready for another Dark Truth about the minimum wage.  Like yesterday this looks at the reason why many people are against the minimum wage, often passionately. Again, a reader warning is advised.

Bob and Janet are a happy married couple.  They have a nice house, cars and lots of stuff.  They have the base felling of being better then anyone they see has less money then they do, but also a bit more.  Bob is a plummet and Janet is a nurse, both make $25 an hour and have worked at their jobs for ten years.  The $25 an hour is no where near what they want in pay, but it is sure a lot better then minimum wage.  Or anything close to it.  When Bob and Janet go to a dollar store or restaurant they can point and laugh at the lowly workers they see making even $11 an hour.  Both Bob and Janet make twice that, so they feel they can belittle such a poor person.  After all, as they make more money, they are better people.  

That %25 an hour that both Bob and Janet make is still a bit low, even for the area they live in currently.  At ten years in with each of their companies they both should be making over $30 an hour, but they are not.  Why?  Well, three big reasons are:

*The company is just filled to overflowing with excuses.  Whenever the subject of a raise comes up you can be sure that it is "the wrong time" or "the economy is bad" or "sales are down".  Really the company can just say anything and use anything as an excuses not to give out a raise.  

*Most companies give raises annually, and again this gives the company lots of excuses not to give a raise.  With a year of work, the company can carefully look over everything an employee has done over the course of a years time.  Anything, even the smallest foot note can be blown out of proportion.  Bob talked back to a supervisor ten months ago and Janet was late three times seven months ago are both more then enough for both companies to deny giving a raise.

*Even on the rare year when the company does breakdown and give a raise, it is very small.  As decided by the nameless faceless people in far away corporate office that maximum raise is 2%.  so even when they got a raise, it was not very much.

So just think what would happen if the $15 an hour minimum wage law was passed.  Suddenly both Bob and Janet would not be making way more then the other lesser workers.  They were making over three times the federal minimum wage.  Worse, for them, is that many people might be making even more then the new $15 an hour minimum wage.  That worker at the dollar store or that restaurant might be making $17 an hour.  Bob and Janet will recoil in horror as they realize they don't make way more then twice the money as such people.  

The horror for Bob and Janet is only just starting.  They will rush into work Monday morning and demand more pay.  They want to put things back the way that feels right to them.  They want the world where they make two or three times the money of the menial workers.  In order to keep everything right in there world, they demand a pay raise.  About $35 an hour should do it, and make then feel normal again.  Of course, the chance of any company doing that is very slim.

 

 

 

Bob and Janet will be faced with a new horror.  The company that exploited them for years cares nothing about their feelings.  The company that both underpaid them and used any made up excuse not to give them a rasie simply does not care about them.  The company does not care how upset they both are, but they will never be getting a raise of something like $10 an hour.  Though the company is open to talking about maybe giving them that 2% raise come their annual review.  

Both Bob and Janet are crushed.  They have wasted ten years of their lives at each of their companies.  They both knew they were underpaid.  They both knew the company was lying when it said things like the bad economy prevented the company from giving any raises for that year.  Even the couple years when they got the pathetically small raise of 2%, they knew that amount was next to nothing.  Yet both of them just staid at their jobs.  They both let a company exploit them for years.  That is the horror they must now live with.

That is another Dark Truth. 

A Dark Minimum Wage Truth

 

 

 

There is a lot of talk today about raising the minimum wage to $15 an hour.  Nearly every worker in America that makes less then $15 an hour is for it.  Many oppose it too, many based on their view of some form of the "theory of economics".  However there is a large group of people, many that make more then $15 that are very passionately against it for seemingly no reason.  You would think anyone would be for poor working people to get more money.  Yet, many oppose it, with a zeal and passion.  Why?  Well, here is a very dark truth.  A reader warning is advised.

Adam is a typical middle class guy.  He has a wife and a couple of kids and a nice house.  He has plenty of money to live comfortably, save money for the future and plenty of free spending money.  His house sits on a nice plot of land and is a huge multi story with a garage and barn backyard pool and front lake.  His house has large spacious rooms, large windows and two fireplaces.  In short Adam lives in his dream home with everything he or his wife wants at a whim.  He owns a recreational vehicle,  a boat, and a vacation house.  Like everyone in his family he has all the stuff he needs or wants.  Whatever he likes or has an interest in, he can simply buy.  His house is full of his stuff: collectable war memorabilia, photos of classic cars and a well stocked library of books. 

Adam's life is great, except all that stuff, from his large house down to his first printing author autographed book, is just stuff.  It is just stuff.  Walking into his vast library to put yet another first printing author autographed book on yet another bookshelf does feel good, but not all that good enough.  Worse the good feeling fades quickly.  Everything he owns is just stuff, and does not make him feel good in the long term: it does not make him feel alive.

Adam then heads off to work Monday morning.  He leaves his home and passes through his neighborhood of people around his own income level, and gets on the highway.  He does not feel anything yet, but that changes as soon as he gets off the highway.  The exit he gets off at is in a much lower income neighborhood.  He drives past houses that are at least half the size of his own house and that have tiny yards.  This right here is where it starts.  Deep in the core of his being, Adam starts to feel good.  The good feeling spreads all thorough his body and he very much loves the feeling.  As he drives along the houses get smaller and much more run down.  One high light of his drive is passing the house with a blue tarp over the section of it's roof.  The tarp has been there for over a year, and he feels good every time he sees it.  As he drives the houses give way to apartments.  Tiny, tiny apartments.  He gets a good feeling thinking that people live in those little apartments that are smaller then his library.  Turning another street and Adam sees something not seen in his neighborhood: people walking around on the sidewalks.  Sure in Adam's neighborhood some people walk for fun or exercise, but he knows the people he sees out now are most likely walking to work.  He passes a bus stop full of people, zooming by in his nearly band new car, and feeling great about it  

Adam pulls into the company parking lot a little bit before eight in the morning.  He is in on real hurry as he has the freedom to start work any time he feels like it.  He casually finds a parking spot and parks his car.  Across the parking lot he can see other employees of the company, ones on a good day he might call workers, rushing to park their cars and run inside the building.  Adam strolls in at his own slow pace, watching the workers run by him.  He knows they must punch in before eight, and he gets a good feeling that he does not have to live by that rule.  He makes a note of one worker he sees from his department, Joe, pulling in the parking lot.  Adam smiles as he knows Joe will never make it to the time clock before eight.  

At just one minute past eight Adam is on the floor screaming at his workers to get to work, and of course, to work faster.  The good feelings as Adam walks around and yells at his workers are nearly endless.  He feels good, even better then good, he feels great.  He loves yelling at his workers, his drones, his numbers, and his slaves.  After verbally abusing everyone under him is sight he goes to his office for even more good feelings.  He calls up the time clock data and sees that, as he well knew, Joe punched in at two minutes past eight.  Adam screams over the PA for Joe to report to his office and gets himself a cup of coffee while he waits. When Joe comes in Adam can't wait to unload on his pathetic slave.  He goes all into how this is Joe's last tardy and he now has eleven points.  Adam goes all out and gets on his high horse: why can't Joe just make it to work on time?  Adam has no problem doing so: he walks up well rested every morning and drives his nearly new car into work at whatever time he feels like it.  Joe tries to offer some pathetic excuses: he had to work his second job and his 27 year old car would not start.  Adam just laughs and gleefully reminds Joe that at twelve points the company will automatically fire him and tells him to get out of his office.    

Adam spends the rest of his morning relaxing in his office, going to a netting or two where he sits around, and yelling and screaming at his worker drone slaves.  At lunch time he orders whatever he wants from the local fancy restaurant as he is free to spend thirty or forty dollars on his lunch.  He makes a pass by the worker lunch room to see what sort of pathetic lunches they have and he is never disappointed.   He sees a mix of cheap fast food and thin homemade sandwiches, but the best is watching Bill reheat a plastic container of macaroni and cheese  with a couple cut up hot dog bits in it.  After lunch Adam yells at his workers some more and relaxes some more in his office.  If he is lucky one of his drone worker slaves might come in a beg to go home early for some reason: pick up their kid, go to a doctor, or get some car repair done.  He can just sit back and laugh as he tells them they can't leave without getting points.  More so as the end of the shift approaches he loves to go out and surprise his workers with mandatory overtime.  Few things feel better then ruining a person day with something like that.  Adam, of course, leaves work whenever he wants.  He has a couple of middle people to stay and watch his worker drone slaves and yell at them.  He has a relaxing drive home where he relaxes even more, and lives his great life.

So, what do you see in the above?  What is the one thing...the only thing that makes Adam feel not just good, but great and makes his whole life worth living? 

It is: The thrill of knowing he is better off then someone else.  

To judge another person and to judge them to be worthless and inferior to yourself is one of the greatest feelings a person can get out of life.  Sure, it is a very negative feeling, but it sure feels great and makes life worth living.  It feels great to sit down to a gourmet lunch of whatever you want, while you watch someone else eat a plain cheese sandwich.   And knowing that it is not because they like that plain cheese sandwich: it’s the knowing that that is all they can afford.  

 

This brings us back to money and wages and the minimum wage.  For anyone making less then $15 an hour life is almost always a struggle.   This struggle is often very obvious to anyone observing as the person who only makes a little money only has cheap things.  People have a deep dark desire to feel better then others, this is a very much a human thing.  It is the basis of friendly competition and a number of other good things.  At least for good people.  If you’re a horrible person, of course, there are lots of negative ways to feel better then someone else.  The fancy car is nice and makes you feel a little good.  Though nothing makes the bad person feel as good as when they drive past someone with a junker car and they know that person is stuck with that car forever.  Eating a nice meal for lunch tastes much better when you watch workers eating little more then bread and water.   

You don’t pity their poverty but you blame them for it, certain in your belief that they’re simply much lazier than you and if they would only work harder or were more intelligent they wouldn’t be here.  You forgot about your own dumb luck, your privilege, your status, your wealth.  You decide because you’re that much smarter and wealthier that they don’t deserve your respect or your kindness and so you lash out. You convince yourself that this type of behavior is okay, because after all, it’s their fault.

HARD lessons learned from the “Texageddon” blackouts

 

 

 

The “Texageddon” blackouts and near-collapse of all infrastructure (food, fuel, cell towers, power grid, water systems, emergency services, roads, etc.) taught us all some very difficult lessons in survival. We learned that the infrastructure is far more vulnerable than most people thought, and we saw with our own eyes that most people still refuse to prepare with extra food and water, even after a year of covid lockdowns that should have been a universal wake up call.

 

 

1. Survival is very physical. Expect to exert a lot of physical effort.
2. Culture matters. Don’t end up in a community without morals or ethics when it all hits the fan.
3. No one is coming to help you. You can’t count on any government or institution or infrastructure to solve anything. Usually they just get in the way.In many situations, no one can get to you even if they wanted to.
4. All forms of electronic cash payments were all completely valueless and useless during the collapse, since they all rely on electricity. Gold, silver and cash worked fine, on the other hand.
5. Investment in food is always a good investment, as prices will continue to climb. No one ever said during an emergency, “Gee, I wish I had less food here. "

 

 

 

Once upon a time, Americans were makers.

Instead of running to the store when their cupboards were empty, they’d cook, craft, and squeeze a second life out of many a household item. They had pressure cookers and root cellars. They were amateur chicken farmers and shoe-leather seamstresses.

 

 

But things started changing. After World War Two, our grandparents came home to a very different country. A production boom during the war (powering Franklin D. Roosevelt’s “arsenal of democracy”) turned around the Great Depression economy. Federal programs put money in the pockets of young Americans who were eager to spend it.

As the economy grew, so did the product selection on store shelves and in catalogs. The host of items that people produced at home for generations—diapers, socks, soap, fruits, vegetables, and many more—could now be instantly purchased, and for cheap.

By the end of the 1950s, American “makers” were a rarer breed, replaced by the era of the “Radarange” microwave, the “TV dinner,” and a dishwasher in every home.  Today, the culture of self-reliance is more in jeopardy than ever. Every household item imaginable is available to buy in a dozen varieties. The average grocery store has 40 to 50 thousand items on their shelves—a more than a 600% increase since just the 1990s!

 

 

 

These blessings have come at cost.

When you can buy new rather than fix what you already have, there's little reason to learn many of the practical household skills that were second nature to our grandparents. Today, one in five millennials don’t know the difference between a Phillips and flat-head screwdriver. Only a little more than half of Americans can iron a shirt and only about one in 10 can tailor their own clothing.

 

Self-sufficiency is being replaced by the ever-accelerating culture of “now.” The instant gratification that began with the microwave and the dishwasher has snowballed to create a world where you can buy groceries without ever leaving your couch.

And with the rise of the Internet and social media, people are able get not only products, but everything from sports scores to friendships delivered instantly.

It makes it difficult for those of us who are makers to pass that wealth of knowledge on to our children and grandchildren. And that’s a problem, because our lack of self-reliance can lead to needless suffering when times get tough. 

Whether they were thinking about readiness or not, our grandparents were prepared by the nature of their lives. Their home-spun self sufficiency provides a great model for emergency preparedness today.

For example, if you remember seeing cupboards full of jarred fruits, vegetables, and preserves in your grandparents’ homes, you’re not alone. Gardening and canning provided a major source of food for many Americans throughout the middle of the twentieth century. In the early 1940s, there were more than 20 million gardens in America and billions of jars—about 30 for every person in the country.

 Imagine the peace of mind an entire wall of canned foods would bring during tough times. Or a garden. Or a chicken coop. Or a rifle and a smokehouse full of venison. Or, even without those resources, the knowledge that come what may, you were armed with the know-how to take care of yourself and your family.

 

 

 

Why Socialism Failed

 

 

 

 

Socialism is the Big Lie of the Twentieth century. While it promised prosperity, equality, and security, it delivered poverty, misery, and tyranny. Equality was achieved only in the sense that everyone was equal in his or her misery.

In the same way that a Ponzi scheme or chain letter initially succeeds but eventually collapses, socialism may show early signs of success. But any accomplishments quickly fade as the fundamental deficiencies of central planning emerge. It is the initial illusion of success that gives government intervention its pernicious, seductive appeal. In the long run, socialism has always proven to be a formula for tyranny and misery.

Socialism Ignores Incentives

A pyramid scheme is ultimately unsustainable because it is based on faulty principles. Likewise, collectivism is unsustainable in the long run because it is a flawed theory. Socialism does not work because it is not consistent with fundamental principles of human behavior. The failure of socialism in countries around the world can be traced to one critical defect: it is a system that ignores incentives.

Under socialism, incentives either play a minimal role or are ignored totally.

In a capitalist economy, incentives are of the utmost importance. Market prices, the profit-and-loss system of accounting, and private property rights provide an efficient, interrelated system of incentives to guide and direct economic behavior. Capitalism is based on the theory that incentives matter!

Under socialism, incentives either play a minimal role or are ignored totally. A centrally planned economy without market prices or profits, where property is owned by the state, is a system without an effective incentive mechanism to direct economic activity. By failing to emphasize incentives, socialism is a theory inconsistent with human nature and is therefore doomed to fail. Socialism is based on the theory that incentives don’t matter!

"Pure" Socialism

In a radio debate several months ago with a Marxist professor from the University of Minnesota, I pointed out the obvious failures of socialism around the world in Cuba, Eastern Europe, and China. At the time of our debate, Haitian refugees were risking their lives trying to get to Florida in homemade boats. Why was it, I asked him, that people were fleeing Haiti and traveling almost 500 miles by ocean to get to the “evil capitalist empire” when they were only 50 miles from the “workers’ paradise” of Cuba?

If perfection really were an available option, the choice of economic and political systems would be irrelevant.

The Marxist admitted that many “socialist” countries around the world were failing. However, according to him, the reason for failure is not that socialism is deficient, but that the socialist economies are not practicing “pure” socialism. The perfect version of socialism would work; it is just the imperfect socialism that doesn’t work. Marxists like to compare a theoretically perfect version of socialism with practical, imperfect capitalism which allows them to claim that socialism is superior to capitalism.

If perfection really were an available option, the choice of economic and political systems would be irrelevant. In a world with perfect beings and infinite abundance, any economic or political system–socialism, capitalism, fascism, or communism–would work perfectly.

However, the choice of economic and political institutions is crucial in an imperfect universe with imperfect beings and limited resources. In a world of scarcity, it is essential for an economic system to be based on a clear incentive structure to promote economic efficiency. The real choice we face is between imperfect capitalism and imperfect socialism. Given that choice, the evidence of history overwhelmingly favors capitalism as the greatest wealth-producing economic system available.

The strength of capitalism can be attributed to an incentive structure based upon the three Ps: (1) prices determined by market forces, (2) a profit-and-loss system of accounting and (3) private property rights. The failure of socialism can be traced to its neglect of these three incentive-enhancing components.

 

 

 

Prices

The price system in a market economy guides economic activity so flawlessly that most people don’t appreciate its importance. Market prices transmit information about relative scarcity and then efficiently coordinate economic activity. The economic content of prices provides incentives that promote economic efficiency.

For example, when the OPEC cartel restricted the supply of oil in the 1970s, oil prices rose dramatically. The higher prices for oil and gasoline transmitted valuable information to both buyers and sellers. Consumers received a strong, clear message about the scarcity of oil by the higher prices at the pump and were forced to change their behavior dramatically. People reacted to the scarcity by driving less, carpooling more, taking public transportation, and buying smaller cars. Producers reacted to the higher price by increasing their efforts at exploration for more oil. In addition, higher oil prices gave producers an incentive to explore and develop alternative fuel and energy sources.

From our experience with price controls on gasoline, we get an insight into what happens under socialism where every price is controlled.

The information transmitted by higher oil prices provided the appropriate incentive structure to both buyers and sellers. Buyers increased their effort to conserve a now more precious resource and sellers increased their effort to find more of this now scarcer resource.

The only alternative to a market price is a controlled or fixed price which always transmits misleading information about relative scarcity. Inappropriate behavior results from a controlled price because false information has been transmitted by an artificial, non-market price.

Look at what happened during the 1970s when U.S. gas prices were controlled. Long lines developed at service stations all over the country because the price for gasoline was kept artificially low by government fiat. The full impact of scarcity was not accurately conveyed. As Milton Friedman pointed out at the time, we could have eliminated the lines at the pump in one day by allowing the price to rise to clear the market.

From our experience with price controls on gasoline and the long lines at the pump and general inconvenience, we get an insight into what happens under socialism where every price in the economy is controlled. The collapse of socialism is due in part to the chaos and inefficiency that result from artificial prices. The information content of a controlled price is always distorted. This, in turn, distorts the incentives mechanism of prices under socialism. Administered prices are always either too high or too low, which then creates constant shortages and surpluses. Market prices are the only way to transmit information that will create the incentives to ensure economic efficiency.

Profits and Losses

Socialism also collapsed because of its failure to operate under a competitive, profit-and-loss system of accounting. A profit system is an effective monitoring mechanism which continually evaluates the economic performance of every business enterprise. The firms that are the most efficient and most successful at serving the public interest are rewarded with profits. Firms that operate inefficiently and fail to serve the public interest are penalized with losses.

Under central planning, there is no profit-and-loss system of accounting to accurately measure the success or failure of various programs.

By rewarding success and penalizing failure, the profit system provides a strong disciplinary mechanism which continually redirects resources away from weak, failing, and inefficient firms toward those firms which are the most efficient and successful at serving the public. A competitive profit system ensures a constant re-optimization of resources and moves the economy toward greater levels of efficiency. Unsuccessful firms cannot escape the strong discipline of the marketplace under a profit/loss system. Competition forces companies to serve the public interest or suffer the consequences.

Under central planning, there is no profit-and-loss system of accounting to accurately measure the success or failure of various programs. Without profits, there is no way to discipline firms that fail to serve the public interest and no way to reward firms that do. There is no efficient way to determine which programs should be expanded and which ones should be contracted or terminated.

Without competition, centrally planned economies do not have an effective incentive structure to coordinate economic activity. Without incentives, the results are a spiraling cycle of poverty and misery. Instead of continually reallocating resources towards greater efficiency, socialism falls into a vortex of inefficiency and failure.

Private Property Rights

A third fatal defect of socialism is its blatant disregard for the role of private property rights in creating incentives that foster economic growth and development. The failure of socialism around the world is a “tragedy of commons” on a global scale.

If everyone owns an asset, people act as if no one owns it. And when no one owns it, no one really takes care of it.

• The “tragedy of the commons” refers to the British experience of the Sixteenth century when certain grazing lands were communally owned by villages and were made available for public use. The land was quickly overgrazed and eventually became worthless as villagers exploited the communally owned resource.

When assets are publicly owned, there are no incentives in place to encourage wise stewardship. While private property creates incentives for conservation and the responsible use of property, public property encourages irresponsibility and waste. If everyone owns an asset, people act as if no one owns it. And when no one owns it, no one really takes care of it. Public ownership encourages neglect and mismanagement.

Since socialism, by definition, is a system marked by the “common ownership of the means of production,” the failure of socialism is a “tragedy of the commons” on a national scale. Much of the economic stagnation of socialism can be traced to the failure to establish and promote private property rights.

As Peruvian economist Hernando de Soto remarked, you can travel in rural communities around the world and you will hear dogs barking because even dogs understand property rights. It is only statist governments that have failed to understand property rights. Socialist countries are just now starting to recognize the importance of private property as they privatize assets and property in Eastern Europe.

 

 

 

Incentives Matter

Without the incentives of market prices, profit-and-loss accounting, and well-defined property rights, socialist economies stagnate and wither. The economic atrophy that occurs under socialism is a direct consequence of its neglect of economic incentives.

No bounty of natural resources can ever compensate a country for its lack of an efficient system of incentives. Russia, for example, is one of the world’s wealthiest countries in terms of natural resources; it has some of the world’s largest reserves of oil, natural gas, diamonds, and gold. Its valuable farmland, lakes, rivers, and streams stretch across a land area that encompasses 11 time zones. Yet Russia remains poor. Natural resources are helpful, but the ultimate resources of any country are the unlimited resources of its people–human resources.

Socialism fails because it kills and destroys the human spirit.

By their failure to foster, promote, and nurture the potential of their people through incentive-enhancing institutions, centrally planned economies deprive the human spirit of full development. Socialism fails because it kills and destroys the human spirit — just ask the people leaving Cuba in homemade rafts and boats.

As the former centrally planned economies move toward free markets, capitalism, and democracy, they look to the United States for guidance and support during the transition. With an unparalleled 250-year tradition of open markets and limited government, the United States is uniquely qualified to be the guiding light in the worldwide transition to freedom and liberty.

We have an obligation to continue to provide a framework of free markets and democracy for the global transition to freedom. Our responsibility to the rest of the world is to continue to fight the seductiveness of statism around the world and here at home. The seductive nature of statism continues to tempt and lure us into the Barmecidal illusion that the government can create wealth.

The temptress of socialism is constantly luring us with the offer: “give up a little of your freedom and I will give you a little more security.” As the experience of this century has demonstrated, the bargain is tempting but never pays off. We end up losing both our freedom and our security.

Programs like socialized medicine, welfare, Social Security, and minimum wage laws will continue to entice us because on the surface they appear to be expedient and beneficial. Those programs, like all socialist programs, will fail in the long run regardless of initial appearances. These programs are part of the Big Lie of socialism because they ignore the important role of incentives.

By providing a powerful system of incentives that promote thrift, hard work, and efficiency, capitalism creates wealth. ism will remain a constant temptation. We must be vigilant in our fight against socialism not only around the globe but also here in the United States.

The failure of socialism inspired a worldwide renaissance of freedom and liberty. For the first time in the history of the world, the day is coming very soon when a majority of the people in the world will live in free societies or societies rapidly moving toward freedom.

Capitalism will play a major role in the global revival of liberty and prosperity because it nurtures the human spirit, inspires human creativity, and promotes the spirit of enterprise. By providing a powerful system of incentives that promote thrift, hard work, and efficiency, capitalism creates wealth.

The main difference between capitalism and socialism is this: Capitalism works