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Wednesday, July 11, 2018

Socialism vs. Private Property, Part 2

As I explained in the first part, the line between private ownership of property and confiscation of property is a free society's last line of defense against totalitarianism. The consequences of property socialization obviously include the destruction of economic incentives, leading to the eventual destruction of prosperity.
However, even more serious are the repercussions that elimination of property have for the very governance of a country. Political parties and movements that advocate private property rights become enemies of the prevailing political system and are therefore barred from access to political power.

For this reason, once the line is crossed and private property has been eliminated, socialism can no longer be "democratic" in even the nominal sense of the term. However, it does not take forceful elimination of individual freedom to transgress the line between formal freedom and unabridged totalitarianism. Socialism becomes totalitarian even if it follows a democratic path to its fulfillment.

The inherently totalitarian nature of socialism was well captured in 1958 by Swedish economist Gunnar Myrdal. Being one of the 20th century's most passionate proponents of socialism, Myrdal saw the welfare state - especially the one he and his wife helped build in Sweden - as a slow-moving bulldozer that would gradually clear the path, right through free-market capitalism, for an egalitarian, socialist utopia. In his book Beyond the Welfare State, Myrdal explained:
Income distribution has the form of a pyramid with a broad basis and a narrowing top. In a democracy with effective universal suffrage, this is one of the explanations why we are steadily proceeding in the direction of government control and direction. Even the conservative and liberal parties will have to become the vehicles for this development, or else disappear from the political scene 
Plainly, simply and brutally: the more dependent people become on government for their livelihood, the more inclined they are to support not only the perpetuation, but also the expansion of that same government.

Many others have expressed the same thoughts, in similar or different words. Those who have, are often critics of socialism. Myrdal's formulation of this conquest-by-entitlement principle stands out because of his role as one of the leading architects of "democratic" socialism in the 20th century. In it, he summarizes the mechanism by means of which socialism imposes itself on a democratic society. This mechanism has two parts.

The first part consists of economic redistribution, where government elevates lower-income earners to a standard of living they otherwise would not have been able to afford. The costs of these entitlements is covered with taxes that add to resource redistribution, asking higher-income earners to provide the money that benefits lower-income earners. As Myrdal points out, the layer of the population benefiting from this redistributive machinery is larger than the layer that provides the funds; by sheer numbers, therefore, the entitled segment can vote themselves both perpetuation and expansion of economic redistribution.

From a simple, pluralistic viewpoint there is nothing remarkable about this process. Every election a majority vote provides sufficient legitimacy for economic redistribution; between elections, the legislative representation of the election majority implements what the majority has voted for. Socialism expands by means of democracy.

That, however, is not the litmus test of whether or not socialism ultimately leads to totalitarianism. It is true that in a parliamentary democracy, the people has the right to end democracy if they want to. That is not the case in a country founded on principles of liberty, specifically a constitutional republic. Under our American form of government, the majority cannot revoke the liberty of the minority; not even the largest possible majority - everyone together - can revoke their liberty. 

The distinctive difference between a constitutional republic and a parliamentary democracy is that the latter ranks the individual below the collective, while the former ranks the collective below the individual. This is the practical meaning of what our Founding Fathers meant when, in the Declaration of Independence, they explained:
We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.
Since socialism, by means of the welfare state and its entitlement programs, uses parliamentary democracy to gradually transform a free-market capitalist country into a socialist state; since the transformation necessarily revokes individual freedoms associated with the pursuit of happiness through prosperity and property; socialism is inevitably totalitarian. 

There is a second reason why the socialist conquest-by-entitlement strategy inevitably replaces democracy with totalitarianism. In the quote above, Gunnar Myrdal notes that non-socialist political parties will have to get onboard with the egalitarian project, "or else disappear from the political scene". History has proven him correct: since his book was published 60 years ago, every party in the parliaments of the major European welfare states has come onboard with a state that is big enough to absorb, redistribute and spend half the economy.

Plain and simple: the welfare state has become universally accepted.

Since political parties that were traditionally against economic redistribution, are now as passionate defenders of the welfare state as traditional socialist parties, the door has closed on real parliamentary democracy. Individual freedom has been confined to the share of the economy - and of social regulation - where the welfare state does not yet reign. 

Private property is very much a victim of the welfare state. The tax base from which government takes the money to fund its welfare state, is private property. When the notion of taxation for redistribution has been widely accepted, and encoded in law, private property has been reduced from an inalienable right to a conditional allowance. The prime purpose of private property is no longer to honor a person's liberty, but to provide enough economic incentives to grow the tax base as needed for the purposes of funding the welfare state. 

When private property is reduced from intrinsic to instrumental status, every other inalienable right is in peril. The closer the socialist project gets to its ultimate goal - the elimination of all economic differences between individual citizens - the narrower the public political conversation will become. Eventually, even the right to criticize egalitarianism will be revoked. The reason is simple: people who intelligently point to the detriments of the welfare state, to the economic losses from high taxes and big economic redistribution, eventually become a threat to the prevailing political order.

That said, it does not take a formal ban on free elections or freedom of speech to establish totalitarianism under the welfare state. All it takes is the universal acceptance of economic redistribution by all political parties. Once that universal acceptance is in place, socialism has replaced free-market capitalism. 

Once the idea of economic redistribution supersedes the idea of private property everywhere from left to right, totalitarianism is victorious. 

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