Can socialism work in small and well-educated countries?

[armand61685]

I saw on yahoo and youtube a piece on how Denmark rated to be the world's most happy country. The country is completely socialist and most of the people enjoy high standard of living.

Could it be because the population is small, tightly-knit, more or less homogenus in ethnicity, and progressive-minded (regarding civil liberties, religious freedom, etc.) and well-educated (because of their free education)? I also read that Denmark has little political corruption and special interest. Basically, the whole country is a big community that works together.

Also, the taxes they probably incur apparently don't affect their standard of living and they have a trust in their government and vice versa.

Of course this means that they live in an extremely collective society in terms of economic worth and resources, but, they are, on average, supposedly the happiest people on earth

I lean libertarian, but does socialism work at this level? Is socialism just another style of society that can work just as much as libertarianism can, so long as the right ingredients are there?

Discuss

[kyleAF]

No, it can't.

They are currently riding the coattails of the market economy. There is no way for a price of a good to be determined in the absence of a market to set the price. How much should a #3 spring coil cost? You don't know, and neither does anyone else...until the market demonstrates the price through its allocation of capital and production / consumption processes. You may drastically over or under-value it, simply because you can't foresee every possible alternative use of it within industry.

Right now, they're seeing the prices of goods and capital that other markets are setting, and are able to model their system after it to some extent.

Now, it *may* be possible for a small-sized commune to get along well-enough, but once you get into the complexity of a modern economy, all bets are off. There's no way for all of the economic transactions to be predictable and manageable. A human does not have the capacity, nor does any supercomputer, even in theory.

Imagine the market as a naturally "controlled" chaotic environment consisting of literally trillions of individual decisions by the people every day. Now imagine trying to figure all that out by committee

We can't even figure out how to stick to the Constitution in the committee known as the U.S. Government...

[armand61685]

But isn't socialism a middle ground between capitalism and communism? Denmark still has markets for things, but their health care and education are socialized.

[Scott Wilson]

Slaves can be happy too.



Socialism is immoral because it uses force to take from one to give to another.

[NoxTwilight]

From what I got from the 60 minutes piece - it works well for them because most all people are at the same income level and their government doesn't waste billions on foreign involvement. They pay much higher taxes but they know where it is spent - on them.

[AceNZ]

Can socialism work in small and well-educated countries?

Socialism can work for a while, and people can be happy -- especially during times of economic growth. But eventually, as the profit motive is destroyed and wealth is redistributed or moved out of the country, the system begins to implode.

In Denmark, around 25% of the work force is employed by the government, and around 60% of the population depends on some form of government money. Income taxes are as high as 63%, and they have a 25% VAT (national sales tax). Around 76% of their workforce is employed in services, rather than real production. It's hard for me to believe a system like that can survive for long.

They do still seem to respect private property, so they aren't totally socialist (yet). In spite of confiscatory taxes, they are operating at least partially based on capitalism, and I'm sure that's what has saved them so far. It will be interesting to see how long it lasts.

[armand61685]

Slaves can be happy too.



Socialism is immoral because it uses force to take from one to give to another.

but what if the people willfully give it up, and in some cases, legislate the tax laws themselves? Doesn't sound like force...

[armand61685]

Socialism can work for a while, and people can be happy -- especially during times of economic growth. But eventually, as the profit motive is destroyed and wealth is redistributed or moved out of the country, the system begins to implode.

In Denmark, around 25% of the work force is employed by the government, and around 60% of the population depends on some form of government money. Income taxes are as high as 63%, and they have a 25% VAT (national sales tax). Around 76% of their workforce is employed in services, rather than real production. It's hard for me to believe a system like that can survive for long.

They do still seem to respect private property, so they aren't totally socialist (yet). In spite of confiscatory taxes, they are operating at least partially based on capitalism, and I'm sure that's what has saved them so far. It will be interesting to see how long it lasts.

Good answer

[Zavoi]

Certainly, a small, close-knit community can function as a socialistic society. As an extreme example, when you have a small family living in one building, rarely do they have to partition their residence into privately-owned parcels, sell food to each other on the free market, or enforce rules against nuisance. There's no reason why the people of Denmark shouldn't be happy in the manner they have chosen for themselves.

Is socialism just another style of society that can work just as much as libertarianism can, so long as the right ingredients are there?

As I see it, libertarianism and socialism (in the small commune style you mention) are not incompatible. Libertarianism is a system of political beliefs, while socialism is a system of social beliefs. If you and your friends want to form a kibbutz or commune under a libertarian political system, no one will stop you by force, as long as it is voluntary.

Problems arise when we forget about the distinction between politics and society. Thus, Temperance movements ended up supporting Prohibition, and charitable, well-intentioned individuals ended up supporting welfare statism. Just because I oppose drinking alcohol doesn't mean I need to force you not to drink alcohol. Just because Ron Paul supported giving a medal to Rosa Parks (with his own money) doesn't mean he had to force you to pay for it. Libertarianism is not a vision for society; on the contrary, it is characterized by its lack of such a vision.

Of course, personally, I doubt that a Danish-style society could work in such a large country as the United States, but freely interacting individuals will determine that, and I will make no moral judgement one way or the other.

[angelatc]

but what if the people willfully give it up, and in some cases, legislate the tax laws themselves? Doesn't sound like force...

Are you saying they had 100% of the voters turn out and vote to be socialist?

Because if one person didn't vote yes, then the system is using force to mae that person participate.

[jkm1864]

I work in the oil and gas industry offshore. I work with people all over the world sometimes. I have worked with people from Norway which is very similar to Denmark and they are miserable. The problem with Europe is the Tax system penalizes You for extra work. The movers and shakers bitch about the same things we bitch about ... Taxes ... Lazy $#@!s ... Immigrants living on welfare .... basicly people that are MOOCHERS. I would say that article just polled people that were down right lazy and stupid while the people that didn't get polled were at work. Hey that poll is kind of like the US but I am educated and smart and I know the only reason in high taxation is so Banking JERKS can exploit the middle class with their evil Usury practises.

[jonahtrainer]

I saw on yahoo and youtube a piece on how Denmark rated to be the world's most happy country. The country is completely socialist and most of the people enjoy high standard of living.

Then why does Denmark face huge labor shortages because their young, educated and productive citizens leave?

Young Danes, often schooled abroad and inevitably fluent in English, are primed to quit Denmark for greener pastures. One reason is the income tax rate, which can reach 63 percent...a level that hits anyone making more than 360,000 Danish kroner, or about $70,000. That same tax rate underpins such effective income redistribution that Denmark is the most nearly equal society in the world, in that wealth is more evenly spread than anywhere else...

But today young Danes can easily choose not to pay for the system's upkeep, once they have siphoned off what they need. For starters, as citizens of the European Union they are entitled to work in any of the 27 EU countries.

Sorensen, who graduated from business school in Copenhagen, found himself earning the equivalent of more than $100,000 before he was 30 - and paying 63 percent of it in taxes. His work as a computer consultant for Deloitte also took him to Brussels, where he met the Spanish woman he would eventually marry.

But the high taxes, mixed with his wife's discomfort in Denmark, meant that a job offer in Qatar three years ago was all it took to pry him away from Copenhagen. Now, he is ensconced in Frankfurt, setting up a new business on the side and planning to pay no more than 25 percent of his income to the German state.

"When you are at 63 percent tax, you don't look forward to the evaluation with the boss to get a raise," Sorensen said. "You look for more vacation or a training course in the tropics - something that you get the full benefit of."

Two articles (One and Two) about Denmark.

Countries are just brands, like Coke or Pepsi, and when the cost outweighs the benefits and the sweet nectar of freedom is drained then just throw away the worthless can to be crushed, melted, reformed and refilled.

[Perry]

Any government can work but whether or not it is successful has little to do with education and more to do with the morals behind that government. Even a total dictatorship can work if the man behind the wheel is "good".
Men however are inherently flawed. This is why the less centralized the government you have the better.

[AceNZ]

Certainly, a small, close-knit community can function as a socialistic society. As an extreme example, when you have a small family living in one building, rarely do they have to partition their residence into privately-owned parcels, sell food to each other on the free market, or enforce rules against nuisance.

If I'm living with my family in a small building, then I am willing to voluntarily share my earnings with them. That's not socialism.

To extend your example, let's include your neighbor's house in your "community". The earnings of both families are required to be shared. But now your neighbor decides he doesn't want to work any more, so you're supporting him as well as your family. Your family doesn't eat as well. You begin to resent your neighbor. You are not giving voluntarily, you are being forced to "give" -- and in fact if you don't want to give (through taxes, for example), violence is used against you (you go to prison). That's socialism.

As I see it, libertarianism and socialism (in the small commune style you mention) are not incompatible. Libertarianism is a system of political beliefs, while socialism is a system of social beliefs. If you and your friends want to form a kibbutz or commune under a libertarian political system, no one will stop you by force, as long as it is voluntary.

I completely disagree. Libertarianism and socialism are completely incompatible. I don't see any distinction between political and social beliefs. If you and your friends join a kibbutz or a commune under a libertarian system, that's like saying "it's OK for me to steal from one neighbor, as long as my other neighbor doesn't steal from me". It's hypocritical and immoral.

Libertarianism is not a vision for society; on the contrary, it is characterized by its lack of such a vision.

Disagree. Libertarianism's vision for society is one of laissez-faire capitalism.

[JosephTheLibertarian]

I saw on yahoo and youtube a piece on how Denmark rated to be the world's most happy country. The country is completely socialist and most of the people enjoy high standard of living.

Could it be because the population is small, tightly-knit, more or less homogenus in ethnicity, and progressive-minded (regarding civil liberties, religious freedom, etc.) and well-educated (because of their free education)? I also read that Denmark has little political corruption and special interest. Basically, the whole country is a big community that works together.

Also, the taxes they probably incur apparently don't affect their standard of living and they have a trust in their government and vice versa.

Of course this means that they live in an extremely collective society in terms of economic worth and resources, but, they are, on average, supposedly the happiest people on earth

I lean libertarian, but does socialism work at this level? Is socialism just another style of society that can work just as much as libertarianism can, so long as the right ingredients are there?

Discuss

Work? Statism is evil. So it just won't work. Besides, the socialism you're advocating for is involuntary, so it's pretty...communism. That's what you want, right? You should do some research on the USSR. It doesn't matter if your country is small, you are still imposing your political will on other people via statism. The socialism you want just makes matters worse. Why not just leave people the $#@! alone? People can learn to live without government by impoving their own lives, not by spewing radical ideologies that turns people off whose livelihood benefits from the status quo. That's pretty much why libertarianism (even though CORRECT) has been stuck in its first five minutes since the days of Adam Smith, people just don't want it. The government is just a mafia. That's all it is. I hope you'll learn to access that, one day.

[JosephTheLibertarian]

I saw on yahoo and youtube a piece on how Denmark rated to be the world's most happy country. The country is completely socialist and most of the people enjoy high standard of living.

Could it be because the population is small, tightly-knit, more or less homogenus in ethnicity, and progressive-minded (regarding civil liberties, religious freedom, etc.) and well-educated (because of their free education)? I also read that Denmark has little political corruption and special interest. Basically, the whole country is a big community that works together.

Also, the taxes they probably incur apparently don't affect their standard of living and they have a trust in their government and vice versa.

Of course this means that they live in an extremely collective society in terms of economic worth and resources, but, they are, on average, supposedly the happiest people on earth

I lean libertarian, but does socialism work at this level? Is socialism just another style of society that can work just as much as libertarianism can, so long as the right ingredients are there?

Discuss

Work? Statism is evil. So it just won't work. Besids, the socialism you're advocating for is involuntary, so it's pretty...communism. That's what you want, right? You should do some research on the USSR. It does'nt matter if your country is small, you are still imposing your political will on other people via statism. The socialism you want just makes matters worse. Why not just leave people the $#@! alone? People can learn to live without government by impoving their own lives, not by spewing radical ideologies that threaten the livelihood of the statist elite that benefit from the status quo. That's pretty much why libertarianism (even though CORRECT) has been stuck in its first five minutes since the days of Adam Smith, people just don't want it. The government is just a mafia. That's all it is. I hope you'll learn to accept that, one day.

[Kludge]

[Acala]

Remember the forgotten man.

The forgotten man is the one who has been robbed by socialism. And he may not even know it. He may not know why he can't find a job in the field he wants to work in. He may not know why he can't afford the things he wants or why they may not even be available. He may not know why he must wait in line for mediocre service. He may not know why he can't get ahead economically. He may not know why he lives in a tiny apartment. He may not know why his hard work and attempts at innovation are not just ignored but actually scorned. He may not know that he is treated like a child. He may not know that the lifeblood is slowly being drained out of his society. But it is.

[Truth Warrior]

If the Danes ( collectively ) are happy ( collectively ) and their ( collective ) system works for them ( collectively ), more power to them ( collectively ). It's none of our ( collective ) business.<IMHO ( individually ) >

[Pianist4Freedom]

Slaves can be happy too.
Socialism is immoral because it uses force to take from one to give to another.

What do you do though, when power becomes concentrated in a private company and they start to do immoral things? It seems to me there must be some circumstances where one must fight fire with fire, perhaps.

[davver]

Smaller government work better then bigger governments no all over the world. The potential for corruption is lower. Hong Kong works better then America. Denmark works better then France.

Many of the socialist countries survive by living on non-renewable resources:

1) Oil (Scandanavia)

2) Children. They don't have any and thier societies are dying. They maintain thier standard of living because they don't have to pay to raise children.

3) Culture. A history of protestant work ethic has been slowly eroded. More and more youngsters living on the state dole.

[armand61685]

Work? Statism is evil. So it just won't work. Besides, the socialism you're advocating for is involuntary, so it's pretty...communism. That's what you want, right? You should do some research on the USSR. It doesn't matter if your country is small, you are still imposing your political will on other people via statism. The socialism you want just makes matters worse. Why not just leave people the $#@! alone? People can learn to live without government by impoving their own lives, not by spewing radical ideologies that turns people off whose livelihood benefits from the status quo. That's pretty much why libertarianism (even though CORRECT) has been stuck in its first five minutes since the days of Adam Smith, people just don't want it. The government is just a mafia. That's all it is. I hope you'll learn to access that, one day.

I'm just saying that socialism can work within certain conditions, like Denmark. I'm talking about perceived "happiness" as an index of how well a country is doing. GDP and other economic factors can give light to how well libertarianism does. Denmark's success is probably due to their culture and overall acceptance of the system.

However, innovation is the key to overall prosperity and Denmark may just be freeloading on the world's technological advancements.

[kyleAF]

No, it can't.

They are currently riding the coattails of the market economy. There is no way for a price of a good to be determined in the absence of a market to set the price. How much should a #3 spring coil cost? You don't know, and neither does anyone else...until the market demonstrates the price through its allocation of capital and production / consumption processes. You may drastically over or under-value it, simply because you can't foresee every possible alternative use of it within industry.

Right now, they're seeing the prices of goods and capital that other markets are setting, and are able to model their system after it to some extent.

Now, it *may* be possible for a small-sized commune to get along well-enough, but once you get into the complexity of a modern economy, all bets are off. There's no way for all of the economic transactions to be predictable and manageable. A human does not have the capacity, nor does any supercomputer, even in theory.

Imagine the market as a naturally "controlled" chaotic environment consisting of literally trillions of individual decisions by the people every day. Now imagine trying to figure all that out by committee

We can't even figure out how to stick to the Constitution in the committee known as the U.S. Government...

^^^There's the reason, once again.

I disagree with socialism (communism, fascism, totalitarianism, whatever you want to call it) on moral grounds, too, but that wasn't the question.

It cannot actually work without relying on capitalism as its guiding light. If one were to assume a hypothetical world socialist state, it would fail, as it would be unable to appropriately allocate production goods, since there'd be no pricing mechanism, since no free market would be around to produce it.

It's nigh impossible to wrap one's head around the complexity and interconnectedness of a market economy. It's STAGGERINGLY complex. There are quite literally billions of separate products in New York city alone, as evidenced by the number of distinct SKU #'s there. Every SINGLE ONE of those has a production process that involves countless resources from many different sources.

As a wild, off-the-wall example of potential pitfalls in complete market planning:
Imagine food rotting on a farm because the train couldn't get there on time to pick it up.
The train was late because the engine failed.
The engine failed because of a broken #3 spring, which could not be replaced
It could not be replaced because the springs were all mis-allocated by a bureaucrat to make pistols for the military.
Now you've lost quite a lot of food.

Yes, that's a crazy and contrived, and over-simplified example, but it's a start in explaining the chaotic, "butterfly effect" of central planning. I'll update it if I can think of a better one.

Size isn't the issue either, as some suggested that Denmark might work because it's small. If you were to imagine this world socialist nation to only have a population of 10,000 people, instead of 6 billion, the same problem is still there: the problem of prices and economic calculation.

There may be a very small commune sized limit where people can limit their production to necessities, which might work without pricing. Barter would work without pricing, but it's a highly limited economic system. Modern economies cannot operate without a free market pricing mechanism to guide them.

If you can prove otherwise, let me know. I'll give you 60% of the book's proceeds ... no one's ever done it.

[ToryNotion]

Von Mises and Hayek said it would never work no how and that settles it. The problem is in relying on a planning board to allocate resources rather than letting the market do it. No planning board no matter how smart and virtuous they may be can make those decisions as well as Mr Market and the result is always shortages of some products and overproduction of others.

[brandon]

The beauty of a free market economy is that people can easily forum voluntary communes within the economy if they like.

No way in hell you can have your own little free market economy under a socialist government.

[AceNZ]

I'm just saying that socialism can work within certain conditions, like Denmark. I'm talking about perceived "happiness" as an index of how well a country is doing. GDP and other economic factors can give light to how well libertarianism does.

Socialism can appear to work for a while. I would be very surprised if Denmark's current system lasts more than another generation before it implodes, destroying whatever wealth is left in the country in the process. Legalized wealth redistribution (theft) in the near term and the inevitable destruction of all or most of the wealth in a country is criminal and immoral, no matter how "happy" the population appears to be happy in the near term (though I'm not convinced that part is even true in Denmark).

[Zavoi]

I completely disagree. Libertarianism and socialism are completely incompatible. I don't see any distinction between political and social beliefs. If you and your friends join a kibbutz or a commune under a libertarian system, that's like saying "it's OK for me to steal from one neighbor, as long as my other neighbor doesn't steal from me". It's hypocritical and immoral.

Perhaps I should have been more clear on what I meant by "socialism". As the OP was, I was referring to socialism as a voluntary agreement among a number of people to share their property among themselves. If we're talking about Soviet-style government, then the "stealing from your neighbor" analogy is fitting, but there is nothing inherently immoral about choosing a socialist lifestyle for yourself.

Disagree. Libertarianism's vision for society is one of laissez-faire capitalism.

Laissez-faire yes, but would you force somebody to participate in the capitalist economy if they didn't want to? I'm not saying that socialism would work in practice (at least when more than a dozen or so people are involved); I'm only saying that libertarianism in itself does not require its adherents to be capitalists, as long as there is no coercion involved.

The beauty of a free market economy is that people can easily forum voluntary communes within the economy if they like.

No way in hell you can have your own little free market economy under a socialist government.

This is the essence of what I'm saying.

[DrCap]

no, never!

[topaz420]

I saw on yahoo and youtube a piece on how Denmark rated to be the world's most happy country. The country is completely socialist and most of the people enjoy high standard of living.

Discuss

Fascinating post, Armand -- I thought about this news story as well.

And as much as I believe in Libertarian principles, I have this discussion with myself when I think of living in Japan's collectivist society.

I know there are other people, born into such a society, who are being forced to live a certain way.

But to willfully enter such a society is an internal paradox that only each individual person has the answer to.

[Paulitician]

True socialism cannot work on a large scale (this is based on economic theory that we can't get into now--just read Mises). Denmark is more of a welfare state. I wouldn't really like to live there, but I dont' know. It's cultrural. As I see it, even if I were extremely collectivistic, I don't need government to make me happy. I never understood why collectivism seems to imply statism to some collectivists. Ugh.