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July
20
2018

Socialism Won
Robert Gore

If she’s elected and goes to Washington, socialist Alexandria Ocasio-Cortez will feel right at home.

Socialism: “A political and economic theory of social organization that advocates that the means of production, distribution, and exchange should be owned or regulated by community as a whole” (Oxford Dictionary), has been in the news lately. The most interesting aspect of the stories and commentaries is what tense the writer uses. Most use the future tense, heralding or decrying the impending arrival of socialism, or simply noting that it’s a possibility.

It’s the wrong tense. The past tense is the correct one, socialism arrived long ago. In the US, it unpacked its bags February 3, 1913, the day the Sixteenth, or Income Tax, Amendment was ratified. When the “community as a whole”—a euphemism for government—has first call on individuals’ incomes, socialism has established its vital beachhead. Everything from there on out is a mop-up operation.

For what is “the means of production, distribution, and exchange”? The minds, bodies, time, and effort of individual producers, which the income tax expropriates. Once a government steals those, there’s nothing it cannot steal, including, via regulation, the ability of producers to produce. To impose socialism on a nation, first impose it on its individuals.

The cherry on 1913’s socialist sundae was the establishment of the Federal Reserve, which began the transition of the US monetary system from the gold standard to fiat debt, the value of which is now decided by political and bureaucratic whim. It was another expropriation, stealth theft via currency depreciation and inflation.

Some are treating “avowed socialist” Alexandria Ocasio-Cortez’s primary victory over Democrat war-horse Joe Crowley as a watershed moment. Assuming she wins the general election, she’ll join 434 other socialists in the House of Representatives. That’s not a watershed political moment, it’s a watershed truth-in-advertising moment. She’ll be one of the few socialists there who admits to it.

The partisans on both sides of the barricades are a hundred years too late. The battle is over, victory to the socialists. In the US, it’s impossible to find an industry or economic activity that’s free from government ownership or regulation. Governments have their hands in agriculture, manufacturing, communications, finance, insurance, banking, transportation, technology, housing, medical care, advertising, entertainment, warfare, welfare, charity, and every other human endeavor of consequence. When children need to get a permit and pay a fee to set up a sidewalk lemonade stand, what’s left?

Judging by the reaction to Ocasio-Cortez’s victory, “socialist” is still an odious term in some quarters, mostly those precincts which still pay lip service to free markets and capitalism. Republicans long ago jettisoned freedom and made their peace with the income tax, the Federal Reserve, welfare and warfare states, and ever-expanding government; their horror is merely rhetorical. The only parts of Trump’s platform that were noncontroversial with them were his vows to increase military spending and not cut entitlements. This in a nation over $21 trillion in debt, with an estimated $200 trillion of additional unfunded liabilities.

Unlike many of us in the hinterlands, those who inhabit the swamp rarely have to answer the question: does it work? When the answer is no in Washington, it’s a justification for an expanded budget and more power. Effectiveness is the hallmark of what remains of honest American enterprise, where whatever your “it” is has to work, or you don’t get paid. Those who have only worked in dishonest enterprise— government and its satellites—are instinctively hostile to that requirement and to those who make things work.

Socialism doesn’t work; history is littered with its failures. That is why it’s embraced. Government derives its power from coercion and violence. It is no coincidence that the twentieth century, history’s most socialistic, has also been its most murderous, with governments inflicting an estimated 100 to 200 million deaths.

Socialism’s failure, death, and inevitable restrictions of liberty account for its odium among those who oppose it. The clearest lesson of history is the most ignored. Man versus the state is history’s overarching theme. Humanity flourishes when it’s free to do so (man wins) and deteriorates when it’s not (the state wins).

There is only one way to eradicate a weed without pesticide: pull it up by its roots. Well over 99 percent of arguments against government—inadequate border security, military interventions, out of control spending and debt, the national security state, loss of liberty, etc.—essentially try to kill the weed by pulling off its leaves and stems, but leave the roots intact. As long as there is unquestioning acceptance of the government’s self-granted right to forcefully relieve the productive of their honestly earned incomes, those issues amount to diversionary sideshows.

Since the dark year 1913, government has grown relentlessly larger, more powerful, and more corrupt. The tax take has gone one direction. Even with all that loot, the government has plunged into the abyss of debt and unfunded liabilities. The US has become an oligarchic empire spanning the globe. At least half its population rely on the state for some or all of their sustenance. Occasionally the socialists have lost battles, but those have amounted to mere tactical retreats. They’ve won the war.

Imagine a government that had no claim on people’s incomes and the monetary system was an honest gold standard. That such a state of affairs seems inconceivable is testament to widespread ignorance of history. This was the actual state of affairs pre-1913, when all levels of government in the US spent less than 10 percent of the GDP, as opposed to more than 40 percent now.

How much of an issue would illegal immigration be if the government paid out no benefits to either immigrants or citizens? The immigrants who arrived would be here to work, and it would be much easier to ensure that they went through the proper channels of citizenship.

Cut down government by 80 to 90 percent and the military would shrink to defense of the US’s eminently defensible borders and tending to a worst-case nuclear arsenal. You’ve got to think the costly Big Brother surveillance apparatus would shrink, too, maybe down to nothing.

There would be no unfunded liability problem, because government would be out of the pension, medical care, and redistribution businesses. A government that couldn’t inflate away its debts with more of its own or its central bank’s fiat debt would be less inclined to borrow. Creditors would be less inclined to lend, because the government would have no call on incomes.

Such a reversion might even work a “miraculous” change in the American character, a rebirth of values like the work ethic, self-reliance, individualism, community involvement, and private charity. One of socialism’s great myths, the opposite of the truth, is that only the government can help out those in need.

An appreciable part of the US’s unprecedented, privately generated bounty has always been redistributed by people acting on their own charitable impulses, not at the point of a government gun. Regular people, not just philanthropic millionaires, help their families, friends, and—through a mind-boggling variety of eleemosynary causes and organizations—total strangers.

Which gives the lie to socialists’ argument that “the masses” (they love that demeaning term) cannot handle freedom, they need to be guided and governed by an expert and virtuous elite. If the human psyche cannot handle freedom, it most certainly cannot handle unlimited power. The last 105 years of elite-initiated horrors offer conclusive proof. Wars, death camps, and genocide didn’t bubble up from they bottom, they’re ordained from the top.

If we don’t insist proudly that we have the first and only legitimate claim to what we’ve honestly earned, if we aren’t willing to fight for it, we are not and never will be free. And that’s why we need all the sideshow issues—to divert our attention from our well-deserved servitude.

WHO’S EXPENDABLE?

AMAZON

KINDLE

Robert Gore was born in 1958 in Livermore, California. He grew up in Los Alamos, New Mexico, where both his parents worked for the Los Alamos National Laboratory. His undergraduate education was at UCLA. He graduated in 1980 summa cum laude and Phi Beta Kappa with a double major in economics and political science. He completed the JD/MBA program at UC Berkeley in 1984. He held part-time jobs throughout undergraduate and graduate school. He passed the bar exam and is an inactive member of the California Bar Association.

Mr. Gore’s career in finance began in 1984 with a bank in San Francisco, trading municipal bonds. In 1985, he went to a Wall Street firm’s west coast municipal bond office in Los Angeles as a bond trader. He developed its block and institutional sales capabilities and after four years was promoted to manager of the region.

In 1990, Mr. Gore went to a private partnership, headquartered in Los Angeles, which served a high net worth clientele throughout Southern California, as head of the firm’s fixed income division. In 1991, he became one of the youngest partners in the firm’s history. The fixed income division was consistently among the firm’s most profitable and in 2003, he was named to the executive committee. He wrote a market commentary that was distributed to the firm’s clients. Already known for his prescient calls, in 2006 he began warning of a looming housing debacle and financial crisis. His family sold their house and he set up a proprietary trading desk to capitalize on the situation. His prediction was initially not popular with his firm’s financial advisors, but it ended up saving their clients a great deal of money and he has garnered a substantial following. His current prediction: the worst is yet to come.

 

 

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