To Operate Fairly Successfully

When socialists or their sympathizers in the USA are told that socialism doesn’t work, they often respond, “Yeah, just look at how terribly countries like Sweden, France, and Germany are working.”

But these fairly successful countries do not have socialist systems: they do not have government ownership and operation of the major means of production; they do not have central planning of resource allocation and central determination of wages and salaries; they have not outlawed capital markets or private banks and other private financial institutions.

And a damned good thing, too, because the residual market-oriented aspects of these countries, which are extensive in spite of various regulations and other interventions, are precisely what permits them to operate fairly successfully.

If they were socialist in the definitional sense I have just sketched, they would have gone down the same road as the USSR, Communist China, Cuba, North Korea, and Venezuela long ago.

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Robert Higgs

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Robert Higgs is Senior Fellow in Political Economy at the Independent Institute and Editor at Large of the Institute’s quarterly journal The Independent Review. He received his Ph.D. in economics from Johns Hopkins University, and he has taught at the University of Washington, Lafayette College, Seattle University, the University of Economics, Prague, and George Mason University. He has been a visiting scholar at Oxford University and Stanford University, and a fellow at the Hoover Institution and the National Science Foundation.

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