Socialism Chile Style!

Socialism has been mortally discredited on economic grounds, thanks to history. But for many people, it has not been discredited on moral grounds. You can tell this by how often people say that while socialism doesn’t work in practice, it is good in theory. That’s a strange notion — that a theory that doesn’t work in the world can somehow still be good. Where else is it to be judged? One would think that a theory whose consistent realization requires concentration or re-education camps and secret police would be morally disqualified even if it “worked.”

I guess the people who say socialism is good in theory really mean they regret that it doesn’t work without the unpleasantness that accompanies it. Why should that be regrettable? The typical answer is that, in socialist theory, people are not materialistic or self-regarding; they are more concerned about others. The regret about socialism turns out to be regret about human nature.

Leaving aside the fact that the taint on self-interest is assumed not established and that one prospers under capitalism by competitively attending to others, is this a valid statement about socialism? Originally socialism promised a superabundance of goods — so much of everything that no one would have to do without anything. Sharing would be unnecessary because scarcity would be abolished. Wasn’t that an appeal to materialism, even gluttony? To be sure, socialism’s miserable record has compelled its advocates lately to discover the “age of limits,” but that is only to make a virtue of necessity.

Socialism, of course, did promise to reconstruct humanity, but the message was always mixed. It promised to subordinate the individual to society while liberating him to be fully himself — free of the necessity to make a living. Leon Trotsky wrote that “Communist man . . . will become immeasurably stronger, wiser and subtler; his body will become more harmonized, his movements more rhythmic, his voice more musical. The forms of life will become dynamically dramatic. The average human type will rise to the heights of an Aristotle, a Goethe, or a Marx.” But the nice Bolshevik also said, “In a country where the sole employer is the State, opposition means death by slow starvation. The old principle: who does not work shall not eat, has been replaced by a new one: who does not obey shall not eat.”

Was the new Socialist Man to be a self-centered achiever or group-centered worker bee? It was never clear how both could be accomplished.

Maybe all that people mean when they sadly point to socialism’s impracticality is that the theory held out hope for ending material inequality. It didn’t exactly do that. Marx promised only “to each according to his needs.” He never said we all have the same needs. Besides, it is capitalism, not socialism, that has achieved essential material equality.

The ugliness of socialist theory now comes into focus. Under individualist and capitalist theory (and practice), each person is free to determine his own needs and, through the division of labor and voluntary exchange, to produce what’s required to satisfy them. (As the old Spanish proverb puts it, “Take what you want and pay for it.”) Under the socialist theory, the individual’s needs are determined and satisfied collectively. Dissent and venturing out on one’s own are not options. As Trotsky acknowledged, everyone is an employee and tenant of the collective — that is, the state. In our case, that would be the federal government.

It’s a mystery why anyone would find that theory beautiful or regret that it doesn’t work in practice. It hasn’t worked over time in ANY country.

Take as an example, the nation of Chile. Chile went, rather than from capitalism to socialism, from socialism to capitalism rather than the “other” way!

The Chilean Experiment

Back in the 1970s, the nation of Chile embarked on one of the boldest sets of free-market economic reforms in history. The government called in the Chicago Boys, as they were called, led by Milton Friedman and other University of Chicago free-market economists. They were given a free hand to redesign the Chilean economic system with property rights, a low flat tax, privatization of the Social Security system, and industry deregulation. In 1991, Friedman wrote that Chile now “has all three things: political freedom, human freedom, and economic freedom. Chile will continue to be an interesting experiment to watch to see whether it can keep all three.”

For four decades, the experiment worked better than anyone could have imagined. According to a study by economist Axel Kaiser for the Cato Institute: “Between 1975 and 2015 per capita income in Chile quadrupled to $23,000, the highest rate in Latin America. As a result, from the early 1980s to 2014, poverty fell from 45 percent to 8 percent.” Chile became one of the wealthiest nations in South America. And it happened in three decades, an eye blink of history.

The Marxists and intellectual class of Latin America always hated the free-market reforms. They disparaged the Chicago Boys as “fascists.” They spent decades attacking the policies (with the stooges in the American media echoing their protests), even as Chile became the jewel of South America. The Marxists invented a narrative of “inequality:” “The rich were getting richer, and the poor were getting poorer, and capitalism is evil.” They infiltrated all of Chile’s cultural institutions: the media, the schools, the universities, the Catholic Church, the arts, the unions, and even the corporate boardrooms. They spread their poisonous creed of collectivism to the populace.

Is any of this sounding familiar to our situation today?

Eventually, the leftists pulled off a political coup. In 2013, the left won the Chilean presidency. The free-market reforms were systematically replaced with “spread the wealth” platitudes. In October 2020, voters approved a rewrite of the constitution, and now property rights and the rule of law are in danger. Chile is now in economic free fall. The poor are getting crushed. The rich are pulling their money out of the country. They have arrived at “equality:” Nearly everyone is suffering.

Meanwhile, back in America, we have an economic transformation of our own going on. The Biden administration promises to help the middle class by handing out trillions of dollars of free money to citizens and paying people more money for not working than working. We will borrow trillions of dollars and pray that the Chinese continue to buy up our bonds and that our currency holds up.

Many of our constitutional protections and congressional rules of behavior, such as the filibuster, which protects the rights of the minority, may be headed to the shredder. The election laws are getting rewritten to benefit, significantly, the party now in power — the Democrats. The House has passed a bill requiring millions of working-class people to join unions and pay dues. The left is saying, don’t worry, this compulsion is going to help the working class. Sure.

A sock-it-to-the-rich tax increase is coming that will make the productive class and the job creators pay their “fair share” with tax rates of 50 percent, 60 percent, and 70 percent.

Will this story have a happy ending?

The answer to that question might be contained in the frightening example of what happened in Chile. It is what our children and college students should be learning in the classrooms — fat chance. The left runs our schools now, too.


It’s easy to write the summary on these two stories placed side-by-side: one fails miserably; the latter transforms from the former to the latter, and in every aspect of life for Chile’s citizens, it’s impossible to even measure the unfathomable massive changes for every person in every aspect of life.

Watching this unfold from North America may seem too far away to be applicable for the U.S. After all, Americans are the “enlightened” citizens of the Western Hemisphere. We can perceive far more than any other fellow Western citizens what’s best for us and best for everyone else, for that matter. Our “enlightened” ones feel we must, on a large scale, increase the scope and size of our government to assure that ALL the needs of every American are determined, defined, and controlled to be equally fulfilled by the enlightened ones.

In that scenario, who needs capitalism? Let’s move quickly to the left and join our governing Leftists, who are already there! Who needs to work hard to accomplish anything? After all, if we were a socialist nation, we could take it easy, cut back our work hours, enjoy our leisure time, and allow someone “lesser” than us to do the work necessary to feed, clothe, medicate, educate, and provide for all that we could ever want. Why not?

“No other country has ever done that successfully. What makes you think WE can?”

“We’re the United States of America. We can do anything on which we set our minds. We should get this socialism thing licked in a year or two — no problem!”

“Hey, do you know where I can get some toilet paper and a toothbrush?”

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