ECON Why we should fight Socialism! (long)

dstraito

TB Fanatic
I wrote this in an attempt to describe what to me is plain common sense about socialism but apparently common sense isn't all that common.

It's a long read but ultimate in several different ways describes why we don't want to go down the road to socialism.

The Stimulus is going to reward businesses that engaged in risky practices and help people and finance companies that made bad financial decisions. Is that not effectively saying "Go ahead with a riskier decision; the US Government will bail you out?"


I read a great column from Cal Thomas and I found it on http://www.jewishworldreview.com/cols/thomas022409.php3.

Several quotes stand out.

Things are rapidly changing. Once, we honored and encouraged hard work, individual responsibility, integrity and achievement. The fruits of success were our reward. Today, we discourage such things by rewarding failure, mediocrity, incompetence and envy. If one does succeed using the old values, the government imposes penalties of higher taxes and more regulations to subsidize those who won't embrace the virtues that built and sustained the nation through truly hard times.
An economic truism is that you don't raise taxes in a recession, but that's what the Obama administration plans to do. They won't call it a tax increase. They'll let the Bush tax cuts expire, jacking up the top rate to 39 percent again, as it was in the Clinton years, a period in which even Bill Clinton was forced to admit he raised taxes "too much." Who believes government needs more of our money, when it already wastes so much of it?

Do we want to replace this great country with all the opportunities it affords to people who play by the rules, work hard and make right decisions, with a country that doesn't care what rules you live by because government will take care of you? And what does this say about people who have played by the rules? They have paid the bank, but now see people who did not getting a handout from government for their mortgages, as if paying and not paying are morally equivalent.

We face a future of ever-bigger and intrusive government and the punishing of achievement unless this generation realizes it has dropped the baton it was handed and returns to pick it up.

The following is an attempt to describe the negative course this country is following:

Let’s look at this phrase “The punishing of achievement”

America has always been the land of opportunity. That statement doesn’t come with a guarantee. What it means is if you work hard toward a goal, you have a good chance of reaching that goal. With a hard work ethic you can be successful. There is no suggested entitlement in this philosophy. This atmosphere has been a Motivating force allowing many to live the American Dream.

Motivation
the act or an instance of motivating.
the state or condition of being motivated.
something that motivates; inducement; incentive.
From http://dictionary.reference.com/browse/motivation

Many people today want to live the American Dream, especially when they see other people living it. They want to materialistic trappings of success as well as the appearance of being successful. Unfortunately, they are not willing to work hard to achieve their goals and instead, demand the Government provide it.

If that group of white people over there are living in large expensive houses and driving fancy expensive cars, why shouldn’t they have the same lifestyle. Since they aren’t it must be discrimination. Never mind the fact that most of the people living large spent a significant portion of their lives working to achieve that goal. They may have started a business and dedicated countless hours making it successful at considerable sacrifice. They may have spent many years getting a college degree, masters, or doctorate or obtained the required education and internship to become a doctor or lawyer.

Fade to modern times. The man on the street with maybe a high school education expects the Government to provide him with the same lifestyle. A winning strategy for getting elected is to pander to those people and make promises to provide them with equality, with the American Dream; without them having to lift a finger to deserve or earn it. Great strategy, there are many fewer people who sacrificed the time and expense to elevate themselves to a higher level so it is easy to obtain their votes. Easy until you can’t deliver on your promises or your actions are SO detrimental to the Country going forward.

There are a few more terms I’d like to introduce for the purposes of this discussion.

Stimulus Generalization
Definition: In classical conditioning, the tendency for the conditioned stimulus to evoke similar responses after the response has been conditioned. For example, if a rat has been conditioned to fear a stuffed white rabbit, it will exhibit fear of objects similar to the conditioned stimulus.​

Behaviorism
Definition: A term referring to the school of psychology founded by John B. Watson based on the belief that behaviors can be measured, trained, and changed.​

From http://psychology.about.com/od/sindex/g/stimgen.htm


Behavioral Extinction
Extinction of operant behavior involves the termination of the reinforcement contingency that maintains the response. The overall outcome of extinction is a reduction or elimination of the operant response​
From http://wik.ed.uiuc.edu/index.php/Extinction

These concepts were illustrated by the experiments that Pavlov did. He started ringing a bell and then providing food for a dog. Soon the ringing of the bell even without the food was enough to stimulate the dog to salivate. Pavlov took that a step further though. He experimented with ringing the bell and not providing the food. Over time the dog stopped salivating because it learned the food was no longer being provided when the bell rang.

There were even experiments such as training an animal to elicit a specific response such as a dog salivating. Then providing negative reinforcement such as an electrical shock at the same time the reward was delivered.

It’s not hard to extrapolate these behaviors to people and society. America traditionally was known as a society where if you worked hard you would get ahead. If you deferred gratification and put your nose to the grindstone, at some point in the future, you would be better of than if you didn’t work hard. You might save for years for a goal of buying a house for your family. You might obtain a higher education deferring years of higher salary for the prospect of obtaining the certification and realizing a higher salary than would have been possible otherwise.

The behavior: Work Hard, Get Ahead.

The principle of Socialism goes against the concept of getting rewarded for your efforts.

Socialism
System of social organization in which private property and the distribution of income are subject to social control; also, the political movements aimed at putting that system into practice.

From http://www.britannica.com/EBchecked/topic/551569/socialism


You can consider just about every form of Government regulation a form of negative reinforcement of the Work Hard, Get Ahead ethic. Most people regard a reasonable level of regulation the price we pay to live in such a great country where we can work hard and reap much. Taxes could be considered a form of dues you have to pay to be in this exclusive club. At some point though, the negative outweighs the positive. When the fruit of your labor is taxed to the point of diminishing returns, what happens? The desire and motivation to continue to work hard diminishes or is extinguished. In a time of a recession, what is needed to get back to prosperous times is a stimulus. Increased taxes are the last thing you need when the behavior you want to motivate is hard work, investment spending and innovation. If let tax cuts from a previous political generation expire, then it is still an increase in taxes no matter how you look at it.

An example would be a small business owner who makes over $250,000 per year. The small business owner hires a few employees and contributes to the overall local and national economy. Now when their maximum tax bracket goes from 35% to 39% by way of letting a previous tax cut expire, their incentive to make more money is reduced, maybe to the point of cutting back the business instead of expanding and trying to fit under the tax bracket with the heavier penalties.

America has the highest corporate taxes of any country in the world with the most regulations governing them. The public expectation is that corporations are greedy and should distribute the wealth more equitably. What is equitable about starting a company, driving it to success, only to have people with little vested interest to expect a larger contribution to society? Its common sense, if you continue to reduce a small business or corporation’s ability to make profits, eventually you will cause the extinction of their motivation to continue. At some point, it is just not worth it.

Negative reinforcement extinguishing the very behaviors that helped found this country and made it so great.

I guess many people have not studied behavioral sciences and lean toward an idealistic society where everyone has what they want in equal increments. Toward the Socialistic goals of Universal Health Care, housing equality, job equality the direction is to tax people, small businesses, and corporations so those goals can be achieved. As the tax burden becomes heavier and heavier, you have fewer and fewer small businesses and corporations, fewer jobs, and much less opportunities.

The outcome of two people with different work ethics being rewarded the same is to be expected. The first person has a hard work ethic instilled by many generations of relations that saw their hard efforts rewarded. The second person is lazy and does the minimum effort required to get by. The first person works 80 hours a week. The second person works 38. At the end of each week they are paid the same. How long do you think it will be before the first person loses their motivation to continue their high performance? Is it not natural to feel if I work hard and they don’t and we are paid the same, why should I work hard?

If the more money I make, the more I’m taxed, is that really an incentive for me to work harder to make more money?

Conversely, if I find I can coast along with a minimal effort and make the same as someone who works very hard, am I not learning a behavior that effort and reward are not related? If working harder can’t get me ahead, why would I want to work harder?

People have different goals and work ethics in life. Some may not want more and are satisfied with their lot in life. Others are driven for betterment and achievement as well as the rewards that go with that. That is why America is called the “Land of Opportunity”. Opportunity again, means that the brass ring is within reach; to grab it you apply yourself.

Lowering the bar and handing the brass ring out to everyone in the name of equality or socialism reduces the motivation and the amount of contributions people provide. The cumulative effect is a reduction in potential, in possibilities.

Heading toward socialism drastically reduces the overall potential in this country. One example measurement is Gross National Product or GNP. The GNP will be reduced by reducing motivations to achieve more. If we institute Health Care for everyone and everyone is paid the same, are we not living in a more Utopian world where everyone is happier?

I contend NO. The overall result of having a lower GNP is a reduced ability to provide the actual social programs being touted. Universal Health Care and less money to provide it means EVERYONE will receive reduced health care. By paying everyone the same either through direct salaries or Government Entitlement Subsidies we are reducing the motivation to achieve more, therefore; we achieve less. We can’t do more with less so how do we provide all these Utopian programs?

Well, we have to raise taxes so the level of societal programs doesn’t decrease. Along with increased taxation goes fewer jobs, more unemployment and because of those reductions, a lower overall amount of money or GNP.

Wait a minute, I think we are stuck in a loop and the reality is, that loop will drive the United States right into the status of a third world country.

The good news is that everyone although poor without adequate social services will be equal.

Is that really good news? Is this the direction we want to head?

Maybe, just maybe, it’s time to get back to the principles that founded this country. We should strive for less Government (thus less government spending), fewer taxes, more incentives to be innovative and capitalistic where the reward is directly related to the effort. American’s are amazing people and can rise to the challenge but take away their motivations and incentives and you drastically lower how great we can be.

I think we have reached the fulcrum, that point-of-balance where it is time to say “ENOUGH IS ENOUGH.”

The concept of “No Taxation without Representation” is an important one. Most people now do not believe they are being represented.

Resentment and outright anger are in an increasing spiral as more and more taxes are levied to provide more and more social programs. What about the level of happiness?

The people that are reaping the most reward are the ones that are providing the least in terms of effort and contribution and work ethic.

Punish the achiever, reward the below average behavior and you effectively reduce the number of achievers and increase the number of below average contributors.

It’s common sense and that common sense is either not understood or it is totally ignored for partisan purposes.

The end result is a lesser country.
 

Freeholder

This too shall pass.
You've written an excellent article, and I agree with what you have to say. The only caveat I have is that UNBRIDLED capitalism can be just as bad as socialism. I wouldn't want to see ALL regulation done away with, or we'll be back to the age of industrial robber barons who, for all intents and purposes, had a slave labor force. I think balance is the key. We certainly don't want Socialism/Marxism ruling our land, but on the other hand, while I do want capitalism to succeed, I don't want them to be able to take advantage of other people in doing so. The problem is human nature -- we are all born sinners, and unless we accept the payment for sin that Jesus Christ made on the cross, we have nothing within us to restrain our sinful natures except our own conscience. That's not always enough, especially when greed and power come into the picture. If all people were intrinsically good, we wouldn't need the checks on our behavior to make sure that we don't take unfair advantage of other people; unfortunately, we DO need SOME checks. However, you are correct in your assessment of socialism, and stated the problem very clearly!

Kathleen
 

jba48

Veteran Member
Kathleen,

You are so right. Unbridled Capitalism is as oppressive as Communism. And Socialism is bad, too. So what is the answer? Just a look at how greed has brought us down is one reason pure Capitalism doesn't work. It's just so darned frustrating. Honestly, I think it's going to take the Return of Christ to fix this world.
 

dstraito

TB Fanatic
I agree

You've written an excellent article, and I agree with what you have to say. The only caveat I have is that UNBRIDLED capitalism can be just as bad as socialism. I wouldn't want to see ALL regulation done away with, or we'll be back to the age of industrial robber barons who, for all intents and purposes, had a slave labor force. I think balance is the key. We certainly don't want Socialism/Marxism ruling our land, but on the other hand, while I do want capitalism to succeed, I don't want them to be able to take advantage of other people in doing so. The problem is human nature -- we are all born sinners, and unless we accept the payment for sin that Jesus Christ made on the cross, we have nothing within us to restrain our sinful natures except our own conscience. That's not always enough, especially when greed and power come into the picture. If all people were intrinsically good, we wouldn't need the checks on our behavior to make sure that we don't take unfair advantage of other people; unfortunately, we DO need SOME checks. However, you are correct in your assessment of socialism, and stated the problem very clearly!

Kathleen

We do need checks and balances and there should be a contributory price to pay to assure essential services. I think most would agree we've pass that delicate balance point and are tipping the scales toward being a lesser nation.
 
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