Socialism Is Pure Inefficiency

Rather than being a radical antidote to the perceived errors of market capitalism, socialism is actually very similar to capitalism, but with some extra steps of inefficiency. Capitalism often consolidates the means of production through increasing returns to scale, and sorts people through the pice system into the roles where they would add the most value to the economic welfare of society. The capitalistic system then lets the people own the means of production through stocks and bonds while giving most people a relatively risk-free life, and has entrepreneurs bear most of the risk. Rather than an agricultural ownership economy where risk was borne uniformly, capitalism concentrates high risk-bearing to a few people. Socialism shifts the risks and responsibilities of the individuals to the state, but does so with mediated consent and adds in some extra steps of inefficiency that are not present in capitalism. Modern capitalism provides most people with a simple path to a decent livelihood without the risks of the more distributed entrepreneurship that was common in the past. Socialism seeks to do the same thing, but the extra layers of government mediation create less efficient outcomes and allocative problems that are far too difficult to solve with central planning. Socialism does not solve the fundamental anxiety-producing problem of capitalism, rather, it merely worsens it.

People in a mass capitalistic society often feel disenfranchised because they live lives that are primarily directed by others. They own little property and gain their livelihood by working for the purposes of their employer. Even highly paid employees experience this disconnect between meaning and daily sustenance. Their own goals are reduced to little more than paycheck collection and consumption. Many do not even feel that entrepreneurship is an option, as they are taught that safe employment is the only choice for respectable people. Although they have the ability to own shares in the companies they work for, they often feel that they do not have as much control as they would like. Employees would like to have a more meaningful impact on the direction of their company. The inability to meaningfully influence the world surrounding them causes these employees to consider socialism as an option. They think that through government power they would be able to regain control over their lives that they feel inaccessible to them in a capitalistic system. 

Although people possess control over the economy indirectly in a socialist society, the problem of ownership is not solved, but rather made even worse by the descent into socialism. In the capitalistic society, people envy those who have real ownership, yet socialists seek to solve the problem by removing the concept of ownership entirely. The ownership that any single employee has over their economic activity in a socialist economy is so indirect that it can barely be felt. The countless layers between the consent of the people and the actual day-to-day activities of the people make the feeling of meaninglessness felt in capitalism even worse. While only a small percentage of people in a capitalistic society are owners, in a socialist society, none are. The removal of the object of envy has little ability to appease the envious. The people are powerless cogs in a large machine in a socialist society, and the machine is only larger than it was before. People are seeking a more human sized economy, and end up creating one far less human than the capitalism they sought to escape.

Capitalism has allowed for the greatest material flourishing the world has seen, but recognizing the fundamental lack of contentedness it can create is needed to protect against a young generation of socialists. The crisis of meaning cannot be solved through the removal of freedom, but rather must be solved through the thoughtful exercise of it. People who used to function as cogs in the machine of industry or the state have lost the agency and imagination necessary to exercise the freedom given to them. Capitalism gives people all the tools necessary to build lives worthy of living and to draw themselves up from the proletarian hordes, yet they fail to do so out of habit. The world is constrained, and no system of government can solve this. People feel the inherent limitations of reality and place the blame on only one realm of human endeavor. If people do not even know what a meaningful life looks like, they will be unable to begin the difficult step of building towards it, and state control will ultimately make this harder.