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Intellections Discussion

Socialism’s Empty Promises

Why don’t socialist economies prosper or feature new products or globally competitive companies?

Responses

In a socialist economy, there is a disincentive to be legally Entrepreneurial.
Of those who get government permission, it is frequently a direct result of corruption.
The real entrepreneurship and innovation that occurs is among mafia entities and black marketeers.
These do not benefit the country or the people

I was interested in the idea that in the poorest and most corrupt countries, the idea that said corruption should be made to be, at least in part, legal. So that people might know what they have to pay, in addition, for public services. Although I would probably now have the addition of using mobile networks to disseminate information on where the lowest bribe might be paid, to consumers. thoughts?

Socialist economies encourage those with entrepreneurial aspirations to conduct business in the "shadow economy". Innovators spend their time devising ways to prosper outside the established system rather than through it. This is true everywhere there is overwhelming government control. The more control, the more widespread "black markets" and "desired paths" emerge. Having spent quite a bit of time in a communist country, I can say from experience, the underground economies are pervasive and necessary.

Socialist economies are centrally planned, often by people with no expertise, knowledge, or incentive to get it right when they dictate policy. There is little to no incentive to improve products or processes. Bureaucratic red tape hinders true entrepreneurs and innovation.

For Socialist Societies, innovation is rare, but not impossible. Usually entrepreneurs know their craft to a higher degree than any federal bureaucrat, and may get turned away given the necessity of such strict government regulation. Thus, innovators, given the opportunity, will move to countries in which they can prosper to a higher degree. However, just because socialism may not be the solution the United States needs, to provide for the basic human needs of it's constituents, the United States Government must actively progress towards providing more for it's citizens, lest we fall further behind in both business and in quality of life.

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