How Far Left in Socialism Are You Willing to Go?

There are two things NOT in question regarding this election: Joe Biden as President would quickly begin a move of this nation to Socialism. There surely are several deals already agreed to for Alexandria Ocasio-Cortez and her fellow leftists in the House of Representatives to throw their weight behind a Biden campaign. Bernie Sanders and Elizabeth Warren have long been Socialists at heart and are, along with AOC, pushing Biden that way as quickly as possible. The second certainty with Biden as POTUS is Democrat Party leadership will as quickly as possible push Joe out of the way to install their parrot, Sen. Kamala Harris, as their voicebox. Pelosi will invoke the 25th Amendment with claims that Joe is incapacitated mentally and physically and incapable of fulfilling the role. Harris would be Vice President, so the hat-trick would be there to open our nation to Pandora’s Box of leftist power with her assuming the role of President. And this trick would be just the first one in a series of far more egregious ones to come.

The question for all Americans today is, “Just how much of your liberties are you willing to concede to Socialist leaders in a Biden presidency?” We will begin this puzzle-and-resolution chapter by reminding you just what in your current life will automatically be taken away in this “new” form of democracy. What things are certain when it comes? Let’s begin at the top:

1. Socialism creates a significantly higher tax burden for individuals.
They have made no secret about the alleged unfairness in our current income tax structure. The wealthy are evil and consume far too much of the nation’s wealth. They are looking hungrily at a 70% income tax rate to begin. This is to “level the playing field,” and spread control of our companies and organizations to those who really own it anyway: the workers. But what will happen?

When an economy has a high rate of taxation, then there are more disincentives than benefits to consider when working or creating a business opportunity. Under the proposed Green New Deal as an example, the idea of a 70% tax rate on the highest incomes could generate extra revenues of $12 billion. The only problem is that this figure would reflect just a 0.3% share of the overall tax hike that would be necessary to complete the plan.

It is easier for people who have excessive wealth to live abroad where tax havens exist. They can take a free ride on the others who don’t have the opportunity to pay the tax. That’s why making a rate that’s too high will almost always be a self-defeating effort when trying to establish a socialist society.

2. Entrepreneurs have no motivation to operate since they aren’t true owners.
This system is the bedrock of our economy and always has been. I’m an entrepreneur. I started a company 28 years ago that has been successful — but not always. No one stepped up to pitch-in when I struggled to make payroll and did so by not paying myself. I couldn’t borrow money for exansion early on, so we did without just to increase our opportunities. We fought to find new ways to make our services better and to achieve better results for our clients. We were rewarded for this, but shouldn’t we have been? And in Socialism, someone else will be making all these decisions and there will be few if any entrepreneurs.

Socialism can create ownership opportunities, but it is rarely for the individual. That means entrepreneurs are instantly disincentivized from putting in the effort and capital to build a business from scratch. Even if the government doesn’t demand 100% ownership of the venture, these leaders can feel like their governing officials are taking an unnecessarily high percentage of their profits. That means their work might go overseas somewhere since there could be fewer risks associated with their venture.

3. The creation of a welfare state can lead to industrial disincentives.
Under President Trump, 13 million people have left the welfare rolls in the U.S. Why is that? Job creation that exploded quickly opened employment doors many of those welfare recipients had never seen. Wages grew. Along with that came new opportunities in education for learning and implementing new job skills. In Socialism, the welfare rolls immediately climb, wages fall, and government controls it all. You may say, “Government will control it all. Why won’t they just pay workers more money?”

When the welfare state of a socialist government is too generous, then there is a disincentive to find a job. That means the society may see a reduction in its labor force as people decide to stay home instead of pursuing a career. That’s why poverty eventually develops. Welfare is supposed to give people just enough to scrape by so that the desire to have more money leads someone to a job.

That’s why governments often counter the results of this disadvantage with mandatory work. This outcome further disincentivizes individuals to be productive, so their individual efforts reduce. That leads to the implementation of specific quotas, so there is always a back-and-forth between society and its leadership over how much production is possible.

4. Governments can fail when trying to regulate industries or own businesses.
Just for a moment, think through all of the commercial and industrial entities with which you interface during a 30-day period: utilities, food, energy in the form of automobile fuel, healthcare, school, local and state government, durable goods, and the list goes on and on. Just imagine if, in your life today, the federal government ran all of those industries. Can you imagine the disarray there would be? What businesses does our federal government operate as good or better than in the private sector? I cannot think of even one.

If we were living in an ideal world, each government would have success in their business regulation activities. Labor markets and public industries would work like clockwork every day. A disadvantage exists because of the fallible nature of humanity. Government interventions are prone to failure. Even if they are successful, then the structure is prone to a higher risk of failure over time because of inefficiencies that exist in resource allocation.

If there are labor market regulations that call for a low-hour maximum for the working week or a high minimum wage, then there can be a spike in unemployment claims. There would also be a lack of flexibility for agencies if there are sudden increases or decreases in demand. High levels of regulation often discourage investment, which eventually leads to lower levels of economic growth when compared to capitalism. And where does ANY investment come from in a Socialist society? FROM GOVERNMENT.

5. Excessive labor market regulations can lead to fewer employment opportunities.
Socialist governments always institute severe regulations on industries to the extent that doing so restricts the number of available jobs. Requiring workers to be available for a specific shift or to work for a particular wage can limit the number of open positions a business can support. Higher levels of market regulations — and we KNOW with AOC and “The Gang” that will certainly occur — can support a better environment or lead to cheaper goods or services. Still, it is a disadvantage that can also discourage investments if they are severe enough.

6. Socialist regulations can cause problems with structural employment.
Structural unemployment is a form of involuntary unemployment. That simply means somebody gets laid-off or simply fired! It occurs because there is a mismatch between the workers’ skills in the economy with what an employer demands. This gap in ability happens primarily because of technology changes that tend to make repetitive skills obsolete. If a large company is the only employer for an industry, then workers have no competition that can use their experience to their advantage. The local educational system encounters a burden as well since massive levels of career retraining become necessary.

Under some forms of Socialism, the government is the only employer for the economy. If leaders decide that certain industries are no longer necessary, then there may not be any options for work for some individuals.

7. Unions can exist in Socialist countries to create divides between workers and owners.
Socialism’s overall goal is to create a society that offers more equality and “harmony” to the average worker. If the policies implemented by the government are geared toward the strengthening of trade unions or perfect equality, then it can lead to an antagonistic relationship between owners and workers. An attitude of “us vs. them” develops that can lead to significant levels of lost time. Just remember: “The Boss is always right.” And in Socialism, the Boss, though maybe not the Boss in the building, is the Government.

During the 1970s, the UK labor market experienced severe shortages because of the high levels of distrust between the unions and company owners. Public ownership can’t stop this disadvantage in its entirety because no one at the management level really cares if everyone gets a bad deal.

8.  Socialism creates higher levels of bureaucracy to navigate.
All governments have high levels of bureaucracy that cause everyone to waste time and money. The difference between Socialism and Capitalism is that the latter offers an economic benefit that can supply other industries’ revenues.

The government will want to determine who is eligible to receive specific benefits when Socialism is society’s primary emphasis. Have you recently gone to a doctor for the first time? If so, you completed a ream of documents with your personal medical history. Why: to comply with federal regulations, like HIPPA.

In Socialism, the process for job applicants is even more involved. Applicants must fill out paperwork to prove their eligibility. Continuous renewals must go through processing. The goal of Socialism may be to streamline the culture and equalize access to services, but more bureaucracy is created in doing so. That means it could take much more time to make services available to those who need them. It also means that the government needs more people to handle paperwork and layer upon layer of bureaucratic nonsense that does nothing but devour time, reduce job efficiency for everyone involved, and limit workers’ opportunity.

9. It forces the government to do all of the spending.
If an economy is going to have an opportunity to grow, then there must be a balance in trade between foreign and internal sources. When innovation takes a hit, then manufacturing grows stagnant in every industry. That means there are fewer purchasing opportunities for everyone except the government. This disadvantage means that more imports may become necessary to maintain the status quo. If this issue continues for some time, then trade deficits can lead to high levels of debt. We know about that. And the government incentives as we’ve seen under this Trump presidency to attract foreign companies to move operations to the U.S. do not exist in Socialism. Why? The costs of operating almost any type of company here will be the same or similar to the costs they operate today. Why move?

This issue causes the socialist government to spend more than it would over the long-term than if it had allowed capitalistic innovation to have some investments.

Summary

I’m certain there must be some good in Socialism. But I so far in exhaustive research have failed to find any process currently functioning in the United States that would work better if we were a Socialist nation. In fact, the opposite is true: across the board, our economy would struggle because of all of the above.

There’s something else to consider: what would be necessary to delete from the U.S. Constitution to move to Socialism? Certainly, few, if any of the first ten amendments could survive Socialism. There would be immediate demands for more control and less individual liberties and freedoms. Americans would become totally reliant on the government for all of our heretofore personal resources and total control over every segment of our lives.

With the government cloak of secrecy we have watched during the last four years, how could Americans expect the transparency we demand today from government officials under a Socialist government? Can you imagine the likelihood of getting the truth about Russian collusion hoaxes, graft and corruption by government leaders, government spying on citizens and monitoring phone calls, emails, and business transactions? The type of life we live today and have lived for generations would be replaced by a true top-down structure in which we answer to “Big Brother,” whoever that will be. And, by the way, we would have little to say about who “Big Brother” is!

How much of all this are you willing to give to the government? I promise you one thing: under a Biden/Harris Administration, that decision will certainly be required for us all. However, in contrast to the current system, in THAT system, someone else will be making that decision for us!


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