Why do so many millennials favour socialism?

Mark MIlke , January 12, 2020

The following is a response to two people who asked about socialism and its apparent attraction for some millennials. I’ve combined the questions from both people. The questions/assertions sent to me are in italics. -Mark Milke

A recent poll conducted by the Victims of Communism Memorial Foundation found that 36% of millennials surveyed look at it favourably. This correlates with another poll done last year by Forum that said 58% of 1,733 voters surveyed approved of socialism. What are your thoughts on that poll but more specifically, comments such as (?):

1.      If you like driving on paved roads, you can thank socialism.

2.      It's because of socialism that the new public library was built and is free for people to use.

Questions 1 and 2 are the same claim and without a deep dive into the assumptions behind individual answers to the poll I can only guess. However, more broadly, here’s my take.

Claimants are mistaking the welfare state (or earlier forms of government) for socialism and communism. Men and women have been taxed to pay for “stuff”/benefits that accrue to everyone dating back to the first tax in ancient Sumer (in modern-day Iraq between the Euphrates and Tigris). That tax was instituted to pay for a war, i.e., to pay for the collective defense of Sumer. The Romans “paved” roads using stones, and financed by taxes.

More recently, the 19th century German chancellor Otto von Bismarck used taxes to pay for pensions and health care, inventing the modern welfare state. (There can be problems with a large welfare state as opposed to a smaller welfare state which can be more focused on actual market failure and thus then only the goods and services the market cannot provide, but that’s a separate issue.)

Building more paved roads or a library from taxes is not socialism or communism. It is merely a continuance of how people have collectively paid for some goods delivered through government since Sumer.

Socialism and communism properly understood are assertions and arguments that government should own the commanding heights of the economy—the mines, farms, factories, railways, airlines, and also control other economic activity overmuch. The Marxist theory is that this is both efficient (no profit) and “fair”.

Except the theory always overlooked practice: Monopolies, including state-owned ones, are the opposite of efficient as there is no incentive to improve, absent the profit motive and/or the presence of a competitor, who can put you out of business. In addition, state-owned monopolies have no price signals. (Customers have to buy the good or service; there’s no choice.) That destroys supply and demand calculations further eroding efficiencies, quality and service.

Control-freak power issues

The other problem of socialism/communism is the problem of concentrated power which inevitably becomes tyrannical.

Lord Action said that power corrupts and absolute power corrupts absolutely. Governments, even limited ones, must by design possess a monopoly on force. (You can’t have two competing armies in a state or you end up with a civil war.). Governments, or their appointed agents (judges) also necessarily have a monopoly on institutional and legal power. (You can’t have two Supreme Courts.)

What that means is that the significant sphere of human freedom that yet remains, and which ought not be monopolized by the state or overly interfered with beyond basic rules and basic regulation, is economic freedom—economic choice. When governments, which already have a monopoly on the use of force and necessary institutions, add economic power as another pillar of control, civil society and individuals are crowded out from any practical role. Freedom is greatly restricted and the state can easily become tyrannical in little and large ways.    

The twentieth century was a lesson in just this and I recommend the 1999 book published by Harvard University, The Black Book of Communism, written by several French authors.

(Initial) democratic socialism and rotting food

Democratic socialism is not communism but neither is it the traditional welfare state or the more limited classical liberal state. Where democratic socialist policy exists in practice—the state owns some commanding heights of the economy, i.e., an airline or an insurance company—there usually still exists a democratic legislature. But the problem of monopolies still exists, and with it the problem of inefficiencies and also likely abuses of power via the state-owned corporation.

When democratic socialist governments do attempt to control too much in the economic sphere, Lord Acton’s prophecy can result: The eventual corruption of a free society and/or tyranny in addition to economic inefficiencies or even disaster. This happened in Venezuela where the socialist Hugo Chavez was (at least the first time) democratically voted into power, and whose policies were socialist in all but name. He continually aggregated more power to the state in part by further nationalization. That led to further erosion of free enterprise which also constricted other freedoms because ever-more power was concentrated in politicians (i.e., Chavez and his cronies).  (See my column on Venezuela and how the government mismanaged food and which resulted in all of it rotting.)

Not all democratic socialist nations go down that road. Northern European states are often referred to as socialist but almost all have a mixture of capitalism (including strong protection for property rights which is core to free enterprise and other freedoms) and some state-owned enterprises and thus some socialism. If they were fully socialist, the Swedish state would own all major enterprises a la the Soviet Union in 1950. But Sweden doesn’t. It is a combination of capitalism, socialism, and a larger welfare state than, say, the U.S. But it is not wholly socialist a la the USSR. Again, people too often mistake a welfare state for socialism. They are not the same thing.    

3.      Forget a minimum wage, we should have a maximum wage.

Short answer: Controlling wages to make them near-equal was tried for seven decades in the 20th century. Anyone who think this doesn’t affect incentives doesn’t understand human behavior. There was a Soviet joke re this: The state pretends to pay us; we pretend to work. Limiting income is no remedy to poverty and in fact depresses the economy and creates more poverty for all.

The core problem with Marxism and fascism: Live, breathe and negotiate through the state

4.      Also, in the section of Ralph vs Rachel where you compare Alberta to Argentina, you compare Marxist socialism to fascism. Am I correct to read that you view them as virtually the same styles of governing due to their similar outcomes? If I'm wrong and you view them as having significant differences, what makes them truly different?

The reference in this section of Ralph vs. Rachel is the problem of concentrated power. Fascists and communists alike believed much of everything should be controlled and routed through the state. The problem is that then delivers ever-more power to the state and its officials (politicians, bureaucrats, judges etc.). Fascists allowed more private companies to exist than did communists but they wanted companies and labour to resolve their differences through the state. Quite literally, Argentinian Peronist policy which came from Peron’s admiration for Mussolini’s model, dictated that labour and business sit down with the government and resolve their differences at that table.

Why is that a problem? Because rather than two powerful entities duking it out without interference, having government officials involved, again arrogated more power to the state. And that meant both business and labour would bribe government officials and politicians to try and obtain favours. When the state with all its institutional power is involved (think of state power as a 1,000-pound gorilla)  to “help” settle disputes, that is very different than the English liberal practice of regulating both labour and business at a distance but letting companies and unions fight it out to a conclusion. Routing all labour-business negotiations through the state leads to corruption and petty tyranny. Again, see Lord Action .  

Some suggested reading:

  • I’d also advise following the Foundation for Economic Education (FEE) on Facebook or Twitter. They are based out of New York, mostly run by economists who know how to write, and produce some great, current shorts columns and videos on many aspects of free enterprise, socialism, misconceptions and the like.

  • My column on communism from 2015: The unrivalled tragedy of communism

One last observation: The earliest libraries in North America were a result of private charity: The 19th century Scottish American industrialist Andrew Carnegie’s name is on many libraries across the continent because he donated much of his fortune to the same. On a related note, the earliest school and hospitals often came from faith-based initiatives (Jews, Catholics, Protestants, others). Socialists were not the reason for that but the religious notion of serving one’s fellow man, though in recent centuries some Christians were also socialists. My own view is that socialists of any variety (democratic, communist, Christian) too often ignore the problem of monopolies and concentrated power, including how it corrupts human freedom and the state when the same socialists ask the state to take on too much. But that’s a different essay.

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Mark Milke’s newest book is The Victim Cult: How the culture of blame hurts everyone and wrecks civilizations. Ask for The Victim Cult at local bookstores; also available autographed and direct, at Chapters.Indigo, at Amazon.ca and Amazon.com.

Mark Milke