Socialism: A Man-Made Malthusian Trap Socialism, as a regime of willful ignorance

Socialism: A Man-Made Malthusian Trap

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Socialism, as a regime of willful ignorance of fundamental economic laws and economic illiteracy, drives society back into the Malthusian trap...

Wed, 07/10/2019 - 19:25
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Authored by Allen Gindler via The Mises Institute,

Despite significant economic progress since ancient times, most people in agrarian societies continued to live at the subsistence minimum until modern times. By the nineteenth century, it was said that these societies fell into a "Malthusian trap." The Malthusian trap describes a situation that keeps population growth in line with available resources. The increase in income per person was not sustainable in the long run, as economic growth was inevitably consumed by population increases.

https://zh-prod-1cc738ca-7d3b-4a72-b...0_10-04-33.jpg Western European countries, however, managed to escape the Malthusian trap through the Industrial Revolution which accelerated in the nineteenth century. Escaping the Malthusian trap meant an increase in both population growth and economic prosperity for the vast majority of people. For example, Europe’s population more than doubled between 1800 and 1900, but the decline of living standards no longer accompanied this growth as it had in pre-industrial societies. Economic historians explained that the phenomenon resulted from technological advances, demographic shifts due to European marriage patterns (marrying in later years, establishing a separate household, having fewer children), and increased human intelligence.

All of the above are supposed to secure the systematic excess of output growth rates over the overpopulation growth rate. It seems that one crucial factor needs to be added to the list: capitalism itself, where economic laws are fully unfolded and have maximum manifestation and impact on society. Humanity entered a capitalist mode of production, which became possible by limiting absolutism and intrusion into the economy, creating democratic institutions, and improving human rights, law supremacy, and its uniform application.
The ideal market economy emerges in the society that is described as a collection of numerous self-governing producers that meet multiple independent consumers and freely exchange commodities and services according to the rates established on the market by the equilibrium between supply and demand. People behave according to the rules and freely exercise their right to enter a business transaction or refuse to participate. Such a society is characterized by the primacy of private property, an extensive division of labor and cooperation, and rich assortments of commodities and services. Economic freedom was accompanied by a high degree of personal freedom. The closest social formation of this ideal happened to be capitalism at the times of classical liberals in the course of the beginning stages of the Industrial Revolution.
Thus, we already see the following pattern: In the societies of hunter-gatherers, economic laws had minimal manifestation but the most prolonged influence (more than 150,000 years). The agricultural revolution created more stable and secure communities, but they were characterized by a lack of capital the lead to low use of more productive factors of production. Low levels of personal economic freedom also inhibited growth and productivity. Industrialization, on the other hand, offered an escape.
But the escape is not always permanent. Socialist governments often act to undo the benefits of insutrialization and capitalism. Historically, socialist regimes have tried to suppress or override the natural operation of personal choice and capital accumulation in economiees. Socialism, in general, encroaches on private property rights, controls the economy, and subordinates individual decision-making to the collective. In this regard, it is appropriate to assume that socialism would push society back toward the Malthusian trap.

Let us examine this hypothesis in light of the case of Venezuela. Venezuela escaped the Malthusian trap only in the thirties of the last century, judging by the GDP output per capita (Figure 1). According to scholars, in the period from the 1920s to the 1940s, the average annual growth rate was more than 10 percent. Indeed, in order to escape the gravity of the trap, an economy needs a high magnitude of acceleration. Now it is hard to believe, but in 1950 , the country ranked fourth in the world in terms of GDP per capita. Unfortunately, as soon as Venezuela established itself as a powerhouse of South America, the government started to implement economic policies from the cookbooks of socialism. Undoubtedly, the country fell prey to the Soviet Union’s influences on Latin America during the Cold War.


https://zh-prod-1cc738ca-7d3b-4a72-b...ages/gind1.png The main assault was directed on private property rights in the industry and in agriculture. In the late 1950s, the government nationalized the telephone company and founded state-owned metallurgical plants and petrochemical and oil corporations. The authority initiated the agrarian reform whereby the state practically expropriated lands from large landowners and redistributed it among new farmers. Despite the continuing economic growth, the Venezuelan economy was poisoned by the venom of socialism. By the 1970s, Venezuela was a mixed economy with a significant share of state-owned enterprises in the most valuable sectors, which were controlled by a central planning agency. Every new government doubled down on implementing socialist measures as a way to solve the socio-economic issues facing society. It was a continuous trend of nationalization of industries, control of prices and minimum wage, unionization, the imposition of new taxes, and administration of exchange and interest rates.
The high revenue from the oil boom fueled the economy; however, the government went on an enormous spending spree. People and the remaining business became live out of the state generosity rather than creating wealth themselves. By 1980, the economic growth stalled, and in the next decade, Venezuela’s economy experienced stagnation. Partial liberal reforms undertaken by the government in conjunction with IMF could not divert an unfavorable trend. Several fruitful years in the mid-2000s, due to a super profit from unprecedented prices for petroleum products, was the last breath before the economy went for a nosedive after the market correction. The economy was exhibiting negative growth, hyperinflation, extreme impoverishment of the population, the deficit of basic food and consumer products.
How can one explain such unfortunate events? Socialism adversely affects personal and economic freedoms—the essential components of socio-economic systems that are subject to universal and natural economic laws. The implementation of socialistic measures inhibited the natural flow of market forces in the official economic sphere and funneled them to the shadow .


https://zh-prod-1cc738ca-7d3b-4a72-b...ages/gind2.png Venezuela has fallen into the man-made socialist Malthusian trap. The socialist Malthusian trap is a condition of politico-economic zugzwang when every consecutive move leads to an even worse situation. Whatever the government does in the framework of the socialist way of thinking will have an accumulating negative effect on people’s wellbeing. Venezuela entered the territory of a humanitarian crisis, which manifested itself in widespread hunger and weakened health care. Gregory Clark’s “A Farewell to Alms: A Brief Economic History of the World” determined the average daily energy intake from food per capita of about 2,300 or less, as is typical for those social systems that did not escape the Malthusian trap. At the same time, WHO established 2,100 kcal/capita/day as a minimum daily norm.
Figure 2 shows that even during the years of stable GDP growth in 1960–1970, Venezuelans experienced food supply problems. This may be evidence of a socialist agricultural reform in the late 50s. Also, the inability to feed their people is a common feature of all socialist regimes. The country was counting on food imports, and when the price of oil was high, food consumption increased. In the socialistic Malthusian trap, people faced acute hunger. The recent study revealed that Venezuelans lost an average of 24 lbs in body weight in 2017. Therefore, both indexes show that socialism drove the country into the Malthusian trap. In contrast to the original trap that all societies used to experience in their history, the socialistic Malthusian trap is human-made. The economic misery was not caused by full-scale warfare or a natural disaster of biblical proportions. Instead, Venezuela had all the ingredients for success, which pre-industrial society was lacking, but stepped into the uncharted territory of socialism and lost the bet.
Socialism, as a regime of willful ignorance of fundamental economic laws and economic illiteracy, drives society back into the Malthusian trap. Venezuela is a vivid and unfortunate example of the implementing of the socialist idea in modern times. The way out of the trap is a full restoration of economic and individual freedoms that guarantee fundamental laws of the economy to unfold freely to people’s advantage.

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America’s failure to stand up to socialism might make us the Stupidest Generation

Peter J. Kennedy

June 10, 2019 (American Thinker) — Seventy-five years ago, our greatest generation stormed the beaches of Normandy to pound the fetid bile out of socialism.
The Stupidest Generation has been honoring that sacrifice with a politically, historically, and philosophically lazy narcissism. Conspicuous consumption became the surrogate for liberty and personal responsibility. We've shown our respect by allowing our constitutional republic to slip perilously close to the rocky cliffs of socialism.
Yes, that socialism.

Time Magazine acknowledged Hitler's magnificent socialist achievements by honoring him as its 1938 Man of the Year. His more Hegelian approach had him blending a state-controlled capitalism with tyrannical dictatorship. Hitler never did like the dull, gray masses produced by Lenin's more Marxist rendition. He did, however, like Lenin's death camps and stole the idea.
It amazes me that almost none of our best voices points out the very real danger — at least not with any frequency or clarity. We're so focused on getting justice for the crimes committed by the Deep State that we've lost sight of the gigantic socialist apparatus that ties all of this together. From Clinton, Mueller, Comey, McCabe, Strzok, Page, and Baker to Obama, Brennan, Clapper, Ohr, Preistap, Yates, Rice, and Lynch (and far beyond), this has been a seditious conspiracy to overthrow the will of the people.
But why?
Dictatorship.
Socialists have murdered well more than 100,000,000 innocent folks in the past 102 years, often in ghastly ways. This same form of socialism is alive and well in American politics. It is lying below the surface — and all they allow us to see are its brightly colored deceits.
Mayor Pete and his daddy love the socialist Antonio Gramsci, who said, "Socialism is precisely the religion which must overwhelm Christianity[.] ... In the new order, socialism will triumph by first capturing the culture via infiltration of schools, universities, churches and the media by transforming the consciousness of society."
They could not beat us from without, but they are quietly succeeding from within. We are one fraudulent major Democrat election win away from having real justice slip away. Hannity likes to say "we'll lose the country as we know it" — but what does that even mean?
The reality is that we are in grave danger. For the socialist left, power makes principles, morality, ethics, the law, and even our constitution irrelevant. When they get that power back, folks are going to pay.
Consider that there are at least two major factors in play here: they lust for absolute power, and they wish to bury very real felonies...forever.
Socialism is a horrific political cancer — and we have it. The symptoms are appearing everywhere, but we carry on as if the body politic might just be suffering a bit of a cold. If we don't wake up soon, surely history will look back and deem us "The Stupidest Generation."
Peter J. Kennedy is an American.

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