Flashcards in Chapter 5 Deck (27):
If we socialize an individual's cost or value,
we spread it to society, at large.
An advocate of socialism asserts that
the individual should act to promote the good of society, not to promote the individual's well being.
Karl Marx said that
production should come "from each, according to his ability, to each, according to his need."
The only alternative to individual freedom is
Marx predicted that
as technology advanced, workers would become obsolete.
A modern rationale for socialism is
that we must socialize individual decisions by state force in order to counter nature's socializing effects.
Socializing effects that spill over into other costs are
External costs and external benefits are called
A polluting firm
imposes costs that they do not pay. This counters efficient decision-making that says these costs should be paid.
If individuals do not agree with the state's decisions, the state can
1) Allow individual choice, but this will not be "serving societal well being" or 2) Use force and threat to maintain the socialist order.
If the state takes all property rights,
a system in which the state does not take full property rights, but dictates to the populace who will control the land and how.
U.S. Socialism is
fascistic in nature.
Imminent domain involves
property being taken for state use (roads, etc), with compensation for the owner.
Civil forfeiture involves
a person being suspected of a crime and then state taking property because it could be involved in committing the crime
The latest socialist rationale is that
if the state provides any goods that an individual might derive external benefit, no property or income is private and the state is justified in taking said property or income.
Bastiat thought that
there is no difference in taking money or physical labor from the populace, because the results are the same.
The right to the "pursuit of happiness" means that
individuals have the right to own property, choose their own profession, etc.
In the capitalist's view, society's best interest
is promoted by those individuals with property rights making voluntary decisions.
These individuals do so by
engaging in value creating production or trade.
give individuals incentives to voluntary serve.
Socialism divorces consumption from production, which is known as the
incentive problem of socialism.
Socialists point out
only differences in income, without understanding why those differences exist, and say that states should use force to fix these differences.
While most people think that there is an increasing 1%, Thomas Sewell demonstrates
that these are mostly elderly folks, and those who are in the 1% aren't likely to stay.
Friedman thought that
there is no system that can hold capitalism's jock strap.
Although the poverty rate is nearly at the same number it was at 40 years ago before increased spending to fight poverty,
America spends 1 trillion dollars to fight poverty.