First Law of Socialism


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“Socialism” is being thrown around more often these days as the nation discusses the pressing issues of our society: health care reform, social security reform, corporate bailouts, etc. Those citizen against the president’s “spreading the wealth around” cry in the shrillest voices possible, denouncing the ideas presented as socialist in nature. In response, the supporters of those measures like to point out that so many other things in our society are already socialized, and they work well, so why not socialize more? After all, public education is socialism, the Social Security program is socialism, the military is socialism–in addition to a litany of others that various people categorize as socialistic. Let’s take a look at them one by one, shall we?

Public education is built on the principle that everyone pays into it through their local property taxes whether they have children attending at the moment or not. National funding is provided to the states who distribute monies primarily to systems needing assistance for paying for extra programs in distressed districts. Everyone pays into the pot: parents, grandparents, single/childless people, and even businesses that pay property tax.

While no data was immediately available to show how many people pay property tax funding a school vs how many people are attending or has a dependent attending a local school, it is reasonable to assume that the Pareto Principle (the 80/20 rule) applies in any given school year. Overall, the number of people benefiting from the public education system is near 100%, since most people have children eventually and life would be very different if only half of our population was educated even to the 6th grade; however, the only reason public education can succeed is that at no specific point is there much greater than 20% of the population taking advantage of society’s free education system.

On the national level, as money is allocated and distributed through the states to a school districts in greater need, again the Pareto Principle comes into play as fewer than 20% of all schools receive greater than 80% of the additional funding based on need.

Social Security, for some reason, is raised as a successful attempt at socializing our retirements. Even though the program is now bankrupt and totally dependent on future tax contributions into the government’s general ledger account rather than contributions into the Social Security account, somehow it is considered a success because they haven’t missed disbursing any of the payments that have reduced buying power from when the program was initially conceived.

Speaking of how it was conceived, payments were not set to be issued until a participant reached 65 when the life expectancy was only 63. Further, the contribution calculation was based on contributions from the first segment of your income up to a given dollar value. That dollar value has not kept up with inflation, meaning people making more money today, by the original standards, would be paying into the system where today they are not.

The changes in our demographic combined with the lack of changes to the system has resulted in fewer workers year after year supporting each retiree. The original plan was that most people were not going to be able to enjoy the benefits of their retirement being funded by Social Security. The only way the system could work long term was to provide the benefits to as few people as possible. Once the politicians started voting based on what the retirees wanted, the system was made unstable and unless we return to the modern equivalent to the original criteria, this experiment in socialism is doomed to fail. Why? Too many people are benefiting from it.

The third example often offered as socialism is the military. However, the military is a volunteer force paid for in full by the taxes from the entire population for the purposes of national defense. No one individual benefits more than any other, unlike Social Security or even the public school system. The amount you collect from Social Security is determined by the amount you’ve made over the years and whether you decided to get married or not. The amount of money distributed to the school systems is a function of the socio-economic status of the town, city, or neighborhood. When it comes to the military, however, no citizen benefits more than any other because it is not a redistribution of wealth, it is the populace paying for a service provided by those who offer it. In this way, the military more closely resembles private industry when there are no limits to what the customer will pay. Even commanders are promoted and dismissed from assignments based on their performance in the field, just as we are at our jobs (in theory).

From these three examples–socialized education, socialized retirement, and national defense–one can probably draw several conclusions. The conclusion in particular that is foreshadowed by the title of this little article is this: Socialism in a field can succeed indefinitely if and only if the vast majority (80-90+%) does not presently desire its benefits. Education succeeds because so few take advantage of it each year while everyone pays for it year after year. Social Security is failing because it is offering benefits to more people than originally intended because the retirement age is greater than the life expectancy. Dispite the supporters of socialism, the military is anything but and continue indefinitely as an entity of the government offering a service to the people, so long as the people desire to continue paying for it. If socialized health care becomes the law of the land, this law of socialism will prevail and the country will not go bankrupt so long as the vast majority of people don’t want to see the doctor.

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