Last night in Dublin I was having a conversation with a 65-year-old man who was ranting about the high unemployment rate in the European Union, which in the 17-nation currency area rose to 12.2 percent in April. The current unemployment rate is a new record since the data series began in 1995. My new friend was very open about being an outright socialist and said that Europe’s problem is that people are not being treated fairly.

Capitalism, he explained, promotes a culture where people do not share their resources because it encourages inequality. To solve the European unemployment crisis, my friend suggested that Europe “needs a dictator” to come in and simply tell everyone what to do so that there will be true equality. The problem, however, my Irish friend confessed, is that when someone gets in a power “they get carried away with it,” and people end up being taken advantage of. He did not seem able to connect the dots that countries that have tried socialism and dictatorships are countries where the poor are worse off in the long-run. Therefore, his proposal will not work.

The conversation raised several questions for me. To start, I wondered why this 65-year-old man drinking a Smithwick’s beer, sitting next to me drinking a pint of Guinness, did not see that we were both experiencing equality thanks to the free market, property rights, and the rule of law. I also wondered why he thinks that something like socialism would be the best way forward given the fact that a form of it is currently not working in the European Union.

While a 12.2 percent unemployment rate is a number that we are used to hearing since 2008, young adults are feeling this worse than any age group. For example, for those under 25-years-old in Greece the unemployment rate is 62.5 percent. In Spain, unemployment surged past 56 percent this year. In total, there are 26 million young people in formally rich European Union countries who are as “NEETS”(Not Employed, or in Education, or Training).

For my Irish friend this data justifies a call for socialism as a solution, but he does not see that the European Union’s socialistic planned economies created a Europe where 26 million young adults have no employment prospects in the future and are despairing about life in general. In fact, suicide rates have significantly increase since the economic downturn all over Europe.

What my Irish socialist friend really wants is a world where everyone has an equal chance to have a good life. This is what we all want. So the central question is not about how we distribute resources but how freely people are to exchange their resources for everyone’s benefit. The kind of equality that make societies work is the kind where people are free to perform and make their own contribution to the common good. David Schmidtz helps us here:

Historically, the welfare of the poor always—always—depends on putting people in a position where their best shot at prosperity is to find a way of making other people better off. The key to long-run welfare never has been and never will be a matter of making sure the game’s best players lose. When we insist on creating enough power to beat the best players in zero-sum games, it is just a matter of time before the best players capture the very power we created in the hope of using it against them. We are never so unequal, or so oppressed, as when we give a dictator the power to equalize us. By contrast, the kinds of equality we have reason to care about will be kinds that in some way facilitate society as a positive sum game. . . . the kind of equality that is liberating is also the kind that historically has been a key to human prosperity—namely, acknowledging people’s right to use their own judgment about how to employ their talents under prevailing circumstances, as free as possible from encumbrances of a race-, sex-, or caste-defined socioeconomic roles.

Planned economies and socialistic governments employ the opposite framework by making unequal decisions about who gets what. The best thing that could happen for the 26 million “NEETS” is for the European Union to dissolve so that working adults can have a decent chance at meeting their own needs and those of their families through a positive sum game because redistribution has helped no one.

  • Curt Day

    Just reacting to the first part of this post, I am amazed how Americans can be so misinformed about socialism. First, just like capitalism, socialism is not a monolith. In fact, there is a debate within the socialist community as to whether the totalitarian regimes of the old Iron Curtain and Red China were socialist at all. Some who associate socialism with worker control point out that the first concern of socialism is the sharing of power rather than the sharing of resources or big government.

    Second, I really expected an article with deeper thought. To just accept the fruits of capitalism without questioning the hidden costs, that is the long range costs for ourselves as well as the high costs that invisible people must pay, doesn’t seem consistent with someone who is a cultural commentator and a professor of ethics.

    Third, the reason why there is unrest now is because our current form of capitalism, that is neoliberalism, which is set in a narcissistic culture has resulted in a consolidation of wealth, rather than a fair dispersing of it. This is the testimony of the Occupy movement from all of the countries in which it is active.

    • RogerMcKinney

      The USSR and China should be called communist, which is what they called themselves. After all, the communist parties ran each. But communism is just the most far left version of socialism. The USSR tried to eliminate markets in the early decades, but the mass starvation and economic collapse forced them to re-introduce limited markets.

      Since then, socialists have all agreed that markets are evil but necessary. China was late in realizing that. Socialists merely disagree about how much of a market is necessary.

      Fascism, NAZIsm, Fabian socialism and the German welfare state were all variations on the theme of socialism that allowed larger spaces for markets.

      Western European socialism and US socialism differ very little, but Europeans call themselves socialists and Americans call themselves capitalist. Europeans are more honest. They still use “liberal” to refer to free markets whereas in the US is means socialist.

      If we use the pre-1929 US as an example of capitalism, then the US since ’29 can’t be called capitalist at all. We tend to have a slightly larger space for markets today than Europe, but the general attitude is that markets are necessary but need to be as tightly controlled as possible. Since FDR the US has clamped down on markets until the economy stagnates and then retreats just enough to get the economy growing again. Carter’s launching of deregulation in the late 1970′s was one such loosening of control of markets after a disastrous decade of stagflation.

      But having a slightly larger market doesn’t make the US capitalist. Capitalism has always been defined by capitalists as the system which protects property through the rule of law. There has never been other types or definitions of capitalism from capitalists, but socialists have always invented a myriad of definitions, none of which any capitalist would agree with. The dominant socialist definition of capitalism today seems to be corporate control of government, as we have in the US. But that is the same as the fascist socialist) system in Italy and Germany in the 1930′s and 40′s.

      Property requires control and the less control one has to property the less property one actually has. Just because a place like the US claims to have private property doesn’t mean it’s true. Holding the paper title to a piece of property means nothing if the “owner” has no control. That was the genius of NAZIsm and fascism; it fooled people into thinking they had property by letting them keep the paper title, but the state controlled all aspects of it, so the people were simply deluded; they didn’t have property.

      Some refer to the US system as a mixed economy, but it should still be called socialist. It is more of the fascist type of socialism.

      • Curt Day

        Roger,
        What capitalism has done, and this is in the spirit of the writers of the Constitution, is to protect the property and privileges of the moneyed interests regardless of how the rights of the others are violated. That is why Madison feared a democracy where each person had a vote in England because he knew that agrarian reform would follow. Considering that Madison was not just in the class of the landed interests whose permanent dominance was argued for in the Constitutional debates, he was also a slave holder. But even without the slaves, the writers of the Constitution were more interested in protected the privileges of their own class.

        The purpose of regulations is to prevent the abuse of others by those with capital. Has it always worked that way? No. But neoliberalism throws the baby out with the bathwater so that while the privileges of those with wealth are preserved, others must suffer and so does the environment.

        BTW, Nazism has always, except by a few conservative commentators been called a conservative movement. That doesn’t implicate all conservatives, but Nazism was conservative with its reliance on traditional values and country first attitude. Their totalitarianism prevents from being classified as a socialist movement unless one oversimplifies the definition of socialism. BTW, one of the differences between Stalin’s Russia and Hitler’s Germany was that the latter recognized private property and capital. And, in fact, the industrialists of Germany were some of Hitler strongest supporters.

        But going back to neoliberalism, if you survey country by country where it has been introduced, you will find a significant number of those countries saw violence and turmoil with or just prior to the introduction of neoliberalism. Pinochet’s Chile along with Yeltsin’s Russia are two prime examples but certainly not the only ones.

        BTW, your definition of socialism is more pejorative than anything else.

        • RogerMcKinney

          You’re doing nothing but judging the motives of people who lived 250 years ago without any evidence. You beg for evidence from me, but you make nothing but groundless assertions with no evidence whatsoever. And you do it with a mean spirit because anyone who judges the motives of another as you do is nothing but mean. Yes, the Constitution was intended to protect the property of the rich just as it was intended to protect the property of everyone. And it did a good job until about 1929.

          I know that Nazism has been called a conservative movement by most socialists, but the term was an acronym for National Socialism; Nazis considered themselves to be socialists and implemented socialist policies. Those who call nazis conservative are simply dishonest. Totalitarianism does not disqualify them from being socialist; Marx advocated totalitarianism. Yes, industrialists are often the greatest supporters of socialism. Industrialists in the US, such as Armand Hammer, were among the greatest fans of the USSR. Socialists desperately want to disassociated themselves from all unpopular forms of past socialism, but hones people won’t let them.

          Violent revolutions have preceded and followed the introduction of socialism in most countries, too. Why do you ignore that? Tell me which neo-liberal country saw 30 million people starve to death as happened in the USSR and China. How many were murdered in Cambodia and Viet Nam with the introduction of socialism?

          My definition of socialism is pretty standard in the rest of the world, especially Europe. Americans have tried to redefine it in order to absolve it of past sins.

          • Curt Day

            Roger,

            How much of the Constitutional debates have you actually read? They are posted on a Yale edu website. Because evidence for what I wrote here is there. And yes, permanent dominance was argued for by some as well as fear about all men getting a chance to vote.

            So if you want to dismiss what I say without handling the content, go ahead. You have the freedom to do so. But in so doing, you are ignoring history.

            In addition, you want to associate “socialism” with nazism and dismiss my statements about nazism being conservative. Fine, go ahead. That is the conservative line made by the Jonah Goldbergs of this world. They do so because they want to establish guilt by association so that nobody will objectively listen to socialists.

            But it wasn’t just the socialists who make that claim. It was nonsocialists because of the concepts preached and put into practice by the nazis. Traditional values along with “country first” nationalism are hallmarks of conservatives today, not of the socialists along with military superiority. And you will note that militarism is also a shared trait between today’s conservatives and the nazis that wasn’t shared by America’s socialists from the past and present along with the socialists of Nazi Germany.

            Remember that the socialists and the communists were the first to be persecuted by the Nazis. While Hitler saw the communists as polar opposite to his dream for Nazi Germany and the emphasis on democracy by the German Socialists of that time was an affront to Hitler who promised to rid Germany of both democracy and diversity.

            Certainly, socialism was introduced to many countries violently. But what kind of socialism was introduced that way? Just like Capitalism, Socialism is not a monolith.

            And if you want to compare numbers, does what happened in Chile, Argentina, and others mean nothing because they didn’t have 30 million people to sacrifice? Are you saying that a movement, like neo-liberalism, is ok because it has killed fewer people? After all, neo-liberalism is a more recent phenomenon so give you should give it some time to catch up.

            The common thread for those countries where atrocities have occurred is neither capitalism nor socialism. It is elite-centered authoritarianism–don’t forget that Scientists like to identify and remove extraneous variables. And that has happened in the name of both Capitalism and Socialism. So if you want to criticize the Soviet Union or the Russia that preceded it, realize that I criticize them too. It was elite-centered authoritarianism that was murderous.

            But also realize that the socialists I hang around with advocate something different just as some of today’s capitalists advocate something different from neoliberalism. And if you disagree with that, then, as Spock would say, you are either unable to make the distinction or unwilling to do so.

            Finally, it is in your mind that your definition of socialism is standard. It fails because socialism is not monolith. This is just another example of you wanting to speak as some kind of authority subject.

          • Piobairean

            Semantics not reality; Naziism had nothing to do with socialism – modeled after Mussolini’s fascists, it was (to use his definition) state corporatism. Nazis were about as conservative as you can get with hyper-nationalism and obedience to authority being the most prominent traits.

            Many countries are much more socialist than the U.S. and have more freedom … Iceland, Denmark, Norway, Sweden, Canada to name a few. As for Cambodia, China, the USSR etc. tyrants are tyrants, they are not always socialists as Pinochet, Samosa, the Shah, Batista and the Argentine Junta prove.

          • RogerMcKinney

            NAZI was the acronym for “National Socialism.” Nazis thought they were socialists and so did the communists who fought them in Germany.

            Socialists never diagrammed what a pure socialist society would look like. Marx was very vague on it. They did little more than attack private property. The NAZI’s, fascists, communists and Fabians were all honest attempts at implementing socialism. Of course current socialists want to distance themselves from the atrocities of past socialists. It makes them look bad.

            But to claim they weren’t socialist, you would have to demonstrate that they violated some principles of socialism.

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  • George DeMarse

    I think you are using “socialism” as a single term for policies that “mitigate” the adverse effects of naked global capitalism when it operates with no mitigation from governments at all. The question then becomes are these government “mitigation policies” actually working–are the results better than naked capitalism itself for many people? I believe the answer is yes. People are better off with unemployment compensation for a period of time when they can’t find a meaningful job–older people are better off with social security payments rather than nothing, people are better off if they can get health care at a reasonable cost rather than let disease get worse.

    I think we can now safely say that global capitalism is “not self-correcting” as the Austrian economists such as Hayek and von Mises would have us believe. So our options are limited and mitigation seems the most reasonable and less drastic path to curb capitalism’s excesses and failings for millions of people. However, that does not rule out more “radical” means to overthrow capitalism’s unequal effects as we continue down the line.

    So the answer to your question will “more capitalism” without restraint present you with unlimited opportunity as you suggest–is no. The “opportunity” will go to those with the most resources–which is not the younger demographic.

    George DeMarse
    The Sage of Wake Forest