Socialism is, typically, a package deal. With heavy taxes to fund the welfare state and said welfare state to alleviate poverty, it is generally viewed positively by the poor and social justice adherents alike. What Socialism also throws in, however, is a myriad of regulations in order to control the economy.
In the spirit of heavily diluted Marxism, Socialists seek to regulate the market in order to prevent exploitation of the working class and, maybe help consumers while they’re at it; a noble goal but one which seldom (if ever) works.
A welfare state is an expensive piece of infrastructure to maintain. In South Africa, for instance, about a third of the country receives grants. Yet, a minority have to bear the weight of this through tax – much of which also has to go to other functions of government.
It doesn’t take an economist to see that this is unworkable. Thatcher famously said: “Socialists are happy until they run out of other people’s money.”
In South Africa, we are facing a scenario very much like this – and the Socialists aren’t going to be happy for much longer. Tax payers are becoming frustrated, as not only are they supporting the majority of the country, but are receiving almost no benefits from it. With this frustration comes more and more tax-dodgers and most dangerously, less business.
Businesses and corporations, as the sources of wealth, are the primary spring from which tax doth flow. But, as the Socialists demanded, these entities are regulated to keep them in line with the great egalitarian ideal.
Let’s create a metaphor for this. You have a hose pipe which is needed to water your plants, but you decide that constricting the hosepipe as much as possible to reduce flow will be better suited for providing as much water as possible.
One does not need to be smart to realise that this is beyond illogical. Then why is that our government is using this model? South Africa has a dire combination of a huge welfare state being funded by a tiny and overly regulated market.
This simply cannot work.
If someone is truly pro welfare states and the alleviation of the poor, they must be pro-free market and thus a Capitalist. Nowhere does it say that a Capitalist cannot be pro-welfare – it just so happens that Socialists have this idea that free markets run in opposition to social justice.
On the contrary, free market Capitalism is the only method which can fund something as expensive as a welfare state. There simply is no other means of generating sufficient wealth.
Thus, if a Socialist truly cared about the poor, they would be a Capitalist. Anything else is unworkable and destructive to both the prosperity of the country and the social status of the population.