The Utility of Socialism

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Ohg Rea Tone is all or nothing. He is educated and opinionated, more clever than smart, sarcastic and forthright. He writes intuitively - often disregarding rules of composition. Comment on his posts - he will likely respond with characteristic humor or genuine empathy. He is the real-deal.

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The Utility of Socialism

Slow down big shooter.  This writer is not a fan of socialism.  Capitalism, moderated by honest Christianity, and regulated by mature government, works best.  In 2008 the United States, the best example of marriage of capitalism, faith, and government, is taking great leaps toward socialism.  Why – because the government recognizes some business functions as being the ‘utility’ of the people.  Utility is not allowed to follow the constructs of capitalist natural selection.

The term Eminent Domain is not found in our Constitution.  But the Fifth Amendment has been used to justify the taking of private lands for the public good. Until the mid-20th Century this was used for public works projects such as roads.  The growth of urban America necessitated collective reasoning about the use of resources.  The evolution of thought led to the understanding of ‘utilities’ as being in the public interest.  Utilities were thought of as infrastructure – roads, water, sewer, electricity, traffic control, etc.  Over time many municipalities took charge of the utility function.  In recent years we have seen a return of utilities to the private sector.

The Sherman Anti Trust Act of 1890 found monopolies of business to be contrary to the public good.  Monopolies of Industry of that time were found in transportation (the railroads), and energy (oil). The monopoly of any given industry is counter to the concept of competition – the driver of capitalism.

The Presidential election of 2008 heard cries of ‘Socialism.’   Let’s visit the American Heritage Dictionary for an unbiased definition:

Any of various theories or systems of social organization in which the means of producing and distributing goods is owned collectively or by a centralized government that often plans and controls the economy.

We live in a time of economic transformation.  And no one knows where we are going.  History grants numerous examples of failed socialism.  And many fear any step toward socialism is a step toward Communism.  Check some of these principles of Communism and ask yourself, are we going in this direction?

  • Abolition of Private Property.
  • Heavy Progressive Income Tax.
  • Abolition of Rights of Inheritance.
  • Confiscation of Property Rights.
  • Central Bank.
  • Government Ownership of Communication and Transportation.
  • Government Ownership of Factories and Agriculture.
  • Government Control of Labor.
  • Corporate Farms and Regional Planning.
  • Government Control of Education.

YIKES! Eminent domain has been expanded in most States to include Commercial development by private companies.  We have a progressive income tax.  Rights of inheritance are threatened by estate taxes.  Is the Federal Reserve less than a Central Bank?  The FCC regulates communications and transportation is controlled by government infrastructure support of roads.  Corporate pig farms provide pigs with lipstick to corporate slaughter houses.  The Fair Labor Standards Act of 1936 regulated Labor.  Most educational institutions are run by government.  Private Educational institutions are regulated by government.

And we are watching the dominoes of economy fall.  The United States Government has just invested 700 billion dollars in our banking industry.  The federal government is looking at investment in the automobile industry.  The justification is not new.

We live in a collectively interdependent economy.  Banking is so central to our economic well being that the government, liberals and conservatives, agree that banking is a ‘utility’ – a function of infrastructure no less than interstate highways or municipal sewers.

To make this personal let me give an anecdotal perspective.  I live in the domain of the Kansas City Power and Light (KCPL) Company.  Last year we experienced an ice storm that brought down power lines across northwest Missouri, cutting power to millions of people at the beginning of winter.  The KCPL sent armies of repairmen.  The power was out at my house for three days.  Some more rural people suffered for two weeks.  If the KCPL had simply announced that they would wait until spring to get the power up – there would have been a public revolt.  Municipal, State, and even the Federal Government would have intervened – probably taking the assets of the KCPL for the public good.

When the credit market stagnated with the current economic crisis the banks effectively said, “Sorry, we will wait for spring.”  Asta la visa, baby.  Predictably, the Federal Government intervened.  This has always been the case.  When privately owned business becomes central to the operation of society – and they fail in their responsibility, the people collectively say, ‘no more.’

The first paragraph of this diatribe suggested capitalism works best when married with Christianity and government regulation.  We used the word Christianity to get the reader’s attention.  What we mean to imply is the ethical practice of Noblesse Oblige – corporate responsibility as a community citizen.  We went on to advocate government regulation – which some business folks decry as socialistic practice.

We submit that some government regulation of banking would have prevented the meltdown of the banks.  We submit that some government regulation of emission control would have led the auto industry to solutions more meaningful in an oil industry crunch.

Free market advocates have valid arguments.  The market WILL EVENTUALLY correct itself.  Capitalism dictates that the right to fail is as inherent as the right to succeed.  Poorly run business will fail – well run business will succeed – capitalism thus follows the principle of natural selection, only the strong survive.  Tinkering with the natural selection of capitalism is a form of genetic engineering – forcing economic evolution into a particular path.

But the alternative is too painful.  The rule of natural selection dictates that some species must die.  Human history has never experienced a successful, long term, socialist economy.  But as individuals in the process of evolutionary economies, we see our food supply drying up.  The death of General Motors will cause the death, or extreme suffering, of the niche markets that feed on the trough of the auto industry.

Regulated capitalism is the only solution.  Business failure is no longer an option.  Failed business results in more individual suffering than we can bear.

We will not spend the winter in the cold.  That is not our nature as humans.

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