While history proves socialism’s failure, debate last week pitting Reason magazine’s Nick Gillespie and Katherine Mangu-Ward against Vivek Chibber of New York University and Bhaskar Sunkara of the Jacobin magazine deserves your attention. That’s because the two socialists, Chibber and Sunkara, encapsulated the crumbling foundation on which socialist adherents reside.
Chibber and Sunkara focused their argument around three key themes: first, that capitalism has not helped the poor; second, that socialism provides for a better quality of life than capitalism; and third, that socialism, not capitalism, serves human opportunity and fulfillment. I’m going to write a post on each claim.
To start, let’s consider the notion that Capitalism has not helped the poor Chibber’s worst moment came with his claim that Chinese communism, not capitalism, was responsible for that nation’s massive improvement in living standards and reductions in poverty.
In fact, China’s economy only exploded after Deng Xiaoping and Zhao Ziyang introduced major liberalization reforms to turn China into an export-driven economy. Members of the Beijing politburo won’t admit it, but capitalism saved them, their predecessors and their successors from oblivion. And while it’s true that China’s economic growth has not spread income equally across society, that’s largely because the government controls the means of production and consumption rather than the middle class. Another systemic socialist failure.
Regardless, the success of China’s reforms is just one example of capitalism’s impact on the broader international economy. Over the past 35 years, capitalism has allowed numerous nations to export goods at low prices and thus spurred a dramatic rise in living standards. Don’t believe me? Ask the Vietnamese what they think.
Still, Chibber wasn’t focused only on foreign nations. He also insisted that the Reason panelists were being “absolutely untrue” when they suggested American incomes have improved over the past 40 years. Instead, Chibber claimed,”For the bottom 50 percent of the population, all of which is working class, there has not been a rise in their wage for 40 years.”
Chibber is actually the one who is being absolutely untrue here.
After all, the St. Louis Federal Reserve Bank shows that U.S. real median household income was $52,068 in 1986 and $59,039 in 2016. Yet breaking down Census Bureau statistics, we also find that between 1986 and 2016, the lowest-earning one-fifth of U.S. households saw their real incomes increase from an average $5,774 to $12,943. In the same period, the second-lowest fifth of households saw income growth from $14,853 to $35,504, the third-fifth $24,855 to $59,149, and the fourth-fifth $37,443 to $95,178.
For socialists who struggle with math, these sums show increases!
When it came Sunkara’s turn to speak, he asked why, if they truly care about the poor, conservatives don’t support government-provided housing, food supply and healthcare as “social rights” alongside public education.
The answer, of course, is that while government already provides some of these benefits, conservatives believe that government ownership over those services would reduce their quality, impose punitive costs on taxpayers, and stifle innovation.
Sunkara, however, suggests we “build a welfare state to get the basics at least” so we can then engage in socialist “testing” of new government policies.
His argument has one fatal flaw. Namely, the fact that socialist policies have already been repeatedly tested and have always proved to be either pathetic failures or grotesque failures. In contrast, capitalism has done more than any economic ideology in history to advance human interests.