Socialism Sucks: Two Economists Drink Their Way Through The Unfree World
By Robert Lawson and Benjamin Powell
Regnery Publishing; hardcover; $25.99
The economic theory of socialism is having a rebirth as millions of Americans—young and old—are preaching its virtues as fair and decrying capitalism.
Part of it is because most people ignore its brutality and don’t understand that socialism isn’t nice, cuddly government that takes care of everything for you so that you can remain an adolescent forever. It has tried over and over again with catastrophic consequences.
Luckily, two Irreverent but honest economists, Robert Lawson and Benjamin Powell, have toured the socialist world so you don’t have to, and they have put their findings in the informative and engaging new book, Socialism Sucks.
As you read about the journey, you’ll learn:
- Why the so-called Swedish model might be attractive, but sure isn’t socialism (Sweden is capitalism with a big welfare state)
- How socialist Venezuela went from being the toast of liberals everywhere—Viva Venezuela!—to being just toast
- Why you never see new cars in Cuba
- Why no one forgets to turn out the lights in North Korea (hint: there aren’t any)
- Why American socialists have no idea what socialism really is
- How hard it is to find good beer—or sometimes any beer at all—in socialist countries
Socialism Sucks is a necessary read for every American who values freedom, sound economics, and feels lucky to be in this country.
Lawson and Powell write of their time in Cuba: Independent of its economic system, almost every country has a few nice hotels and restaurants. In government-directed economies, a disproportionate amount of money is spent on what political leaders desire - typically, great Olympic sports teams, and a few showcase hotels and restaurants to impress foreigners. In Cuba's case, this included the opulent Hotel Nacional, reportedly one of the world's great hotels. But we were on a mission to see what life was like inside Cuba's socialist system. We couldn't experience that by drinking Cuba libres at a fancy resort, but we weren't going to sandbag it either. Neither of us is into necessary suffering.
Our first night was at a supposed three-star hotel on the coast in the Western suburbs of Havana, recommended by Bob's Mexican friend Jose Torra. Our reservation included a shuttle from the airport, but the driver never showed up. Cabs were plentiful, so it wasn't a big deal. We jumped into a modern, yellow, Chinese-made car with air-conditioning and paid a twenty-five dollar fare. We didn't know it at the time, but it was the nicest car we would get into until our wives picked us up from our respective airports a week later.
The Hotel Neptuno Triton opened in 1979, during the heyday of Cuban-Sovier cooperation. It has two towers, each looking like a Soviet housing project, protruding some twenty stories into the sky. The towers were once gleaming white, if the poster in the hotel lobby can be believed, but thirty-seven years of diesel fuel emissions and neglect have turned them a sickly tan color. Most of the windows on the upper floors were broken.
The lobby, though not air-conditioned, was well maintained. Bob had reserved two rooms for thirty-three bucks apiece with his credit card through a British website. Thanks to the American government's rules against American companies doing business with Cuba, American credit cards don't work anywhere on the island. Booking with a British middleman is a workaround. Bob strode up to the registration desk and said, "Tenemos una reservacion."
Bob's Spanish is better than mine, which is to say he can habla poco. I picked up what little Spanish I know through traveling in Spanish-speaking countries and playing basketball with Puerto Ricans. That means I can order in restaurants and bars, demand a basketball, and express my displeasure when I don't get it. Bob did most of the talking on this trip.
The desk clerk typed frantically on her computer while engaging Bob in an equally frantic conversation in Spanglish.
He told me, "They can't find our reservation. She'll contact the British company and recommends we wait in the lobby." We opted to wait in the bar instead.
Cristal is Cuba's lighter beer, at 4.9 percent alcohol. The other beer, Bucanero, is slightly stronger at 5.5 percent and has a bit more flavor. That's the extent of the beer variety in Cuba. But hey, it's better than Venezuela. At least Cuba hadn't run out of beer, though beer shortages have occurred here as well.
Two Cristals later, the desk clerk motioned Bob back to the counter. She could not reach the British company. Bob solved the problem the capitalist way. He paid sixty dollars cash for one room with two beds.
Two cervezas didn't give me beer goggles strong enough to overlook the shoddiness of the hotel. Three out of the four elevators were out of service, and we waited what seemed like forever before we decided to hoof it up the five flights of stairs with our bags. We found our room down the dark hallway, and Bob needed both the key and his shoulder to open the door.
At first the room seemed okay. The beds were neatly made, and despite missing a knob, the air conditioner turned on and blew cold air. That was important, since I was sweating like a whore in church after climbing all those stairs.
From the balcony, with its cracked glass railing, we had a view of the ocean, the deteriorating twin tower, and an abandoned courtyard. The bathroom, however, was the real gem. One of the metal ceiling panels was missing; there was mold everywhere; and, as we'd find out the next morning, running water was not guaranteed.
Bob and I have hiked many mountains together, and we've spent plenty of nights sleeping on the ground. We've definitely gone without indoor plumbing. This was nothing we couldn't handle. We decided to go relax at the pool.
Luckily, we caught the elevator as it rumbled to a stop at our floor. It was stuffed with people and their belongings, and as we squeezed in, I had some idea of what it would feel like to leave Cuba by boat.
The pool wasn't any better. Empty beer cans floated in the cloudy water. The twenty seats of the swim-up bar had long since deteriorated, and the mirror behind the bar was broken. Luckily there was a snack bar that sold beer. Our immediate surroundings at the decaying hotel were mostly offset by the nice ocean view, as long as you ignored the litter-strewn beach and the abandoned oil tank half-submerged in the rocky sand.
Before the revolution, Cuba had a thriving urban middle class, along with widespread rural poverty. Twentieth-century socialists claimed socialism would deliver greater equality and out-produce capitalism by ending wasteful competition, business cycles, and predatory monopolies. Socialism hasn't delivered the goods it promised in Cuba or anywhere else. Today, Cuba is a poor country made poorer by Socialism.
Here's why: almost a hundred years ago, the Austrian economist Ludwig von Mises explained that socialism, even if run by benevolent despots and populated with workers willing to work for the common good, could still not match capitalism't performance. Socialism requires abolishing private property in the means of production. But private property is necessary to have the free exchange of labor, capital, and goods that establish proper prices. Without proper prices, socialist planners could not know which consumer goods were needed or how best to produce them. Socialist planners often compensate for their lack of market pricing by relying on prices from foreign capitalist countries or their own country's black-market prices, but foreign-market prices and internal black market prices are obviously poor equivalents to local free-market - another way of saying "accurate" - prices.
Socialism also gives tremendous power to government officials and bureaucrats who are the system's planners - and with that power comes corruption, abuse, and tyranny. It is no accident that the worst democides of the twentieth century occurred in socialist countries like the Soviet Union, Communist China, and Nazi (National Socialist) Germany, where planners simply decided to eliminate populations they thought interfered with their plans.