Thomas Sowell. From Marxism to the Market

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The following is from Thomas Sowell. Barbarians inside the Gates. pp. 10 - 12

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From Marxism to the Market

RECENTLY A STUDENT WROTE to ask me a familiar question: How and why had I changed from a young leftist to someone with my present views, which are essentially in favor of free markets and traditional values? In a sense, it was not so much a change in underlying philosophy as in my vision of how human beings operate.

Back in the days when I was a Marxist, my primary concern was that ordinary people deserved better and that elites were walking all over them. That is still my primary concern, but the passing decades have taught me that political elites and cultural elites are doing far more damage than the market elites could ever get away with doing.

For one thing, the elites of the marketplace have to compete against one another. If General Motors doesn't make the kind of car you want, you can always turn to Ford, Chrysler, Honda, Toyota and others. But if the Environmental Protection Agency goes off the deep end, there is no alternative agency doing the same thing that you can turn to instead.

Even when a particular corporation seems to have a monopoly of its product, as the Aluminum Company of American once did, it must compete with substitute products. If Alcoa had jacked up the price of aluminum to exploit its monopoly position, many things that were made of aluminum would have begun to be made of steel, plastic, and numerous other materials.

The net result of market forces was that, half a century after it became a monopoly, Alcoa was charging less for aluminum than it did at the beginning. That was not because the people who ran the company were nice. It was because market competition left them no viable alternative.

How you look at the free market depends on how you look at human beings. If everyone were sweetness and light, socialism would be the way to go. Within the traditional family, for example, resources are often lavished on children, who don't earn a dime of their own. It is domestic socialism and even the most hard-bitten capitalists practice it.

Maybe someday we will discover creatures in some other galaxy who can operate a whole society that way. But the history of human beings shows that a nation with millions of people cannot operate like one big family.

The rhetoric of socialism may be inspiring, but its actual record is dismal. Countries which for centuries exported food have suddenly round themselves forced to import food to stave off starvation, after agriculture was socialized. This has happened all over the world, among people of every race.

Anyone who saw the contrast between East Berlin and West Berlin, back in the days when half the city was controlled by the Communists, can have no doubts as to which system produces more economic benefits for ordinary people.

Even though the people in both parts of the city were of the same race, culture and history, those living under the Communists were painfully poorer, in addition to having less freedom. Much the same story could be told in Africa, where Ghana relied on socialistic programs and the Ivory Coast relied more on the marketplace, after both countries became independent back in the 1960s.

Ghana started off with all the advantages. Its per capita income was double that in the Ivory Coast. But, after a couple of decades under different economic systems, the bottom 20 percent of people in the Ivory Coast had higher incomes than 6o percent of the people in Ghana.

Halfway around the world, it was much the same story in Southeast Asia. Burma once had a higher per capita income than Thailand, until Burma went socialist. Today, Thailand's per capita income is 5 times that of Burma.

Economic inefficiency is by no means the worst aspect of socialistic government. Trying to reduce economic inequality by increasing political inequality, which is essentially what Marxism is all about, has cost the lives of millions of innocent people under Stalin, Mao, Pol Pot and others.

Politicians cannot be trusted with a monopoly of power over other people's lives. Thousands of years of history have demonstrated this again and again and yet again.

While my desires for a better life for ordinary people have not changed from the days of my youthful Marxism, experience has taught the bitter lesson that the way to get there is the opposite of what I once thought.

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2 June 2024