Background of the Experiment:
Economists Robert Lawson and Benjamin Powell decided to travel around the world to see firsthand the effects of socialism on different economies. They wanted to look at countries and compare them on the basis of beer. Yes… beer. Lawson explained, “alcohol is a metaphor in different countries for how their economies function.” As they travelled around the world, they could get a decent picture of the economy when the exact same beer cost drastically different prices in different places. They even found that some socialist economies wouldn’t even offer more than two options of beers. These findings were an indicator of the negative effects that socialism ultimately brings about.
Rise of Popularity of Socialism:
One thing that Lawson and Powell found through their study was that socialism has increasingly grown popular among people in their 20’s and 30’s. The economists noticed when engaging with these young socialists that many of them had a misconception of what socialism truly is. They only spoke about the goals they wanted to accomplish with socialism, such as reduced poverty, reduced cost of healthcare, more equality, etc. One main thing that Lawson and Powell found to be the source of this widespread misconception is the media. The New York Times was brought up as an example. For an entire year, a series of articles promoting socialism were published. The problem was that rather than discussing the real effects of socialism and what it meant for an economy, the paper focused on topics such as “why women have better sex under socialism.” These topics were wildly presumptuous and imaginative. The articles only painted socialism in a way that people wanted to see it.
True Meaning of Socialism:
“Socialism is not just a set of aspirational goals,” explained Lawson. What socialism really is, is the abolishment of private property and the major factors of production - replacing it with some form of collective ownership and control. After discussing this definition with young socialists, many of them express that is not what they want. What happens when there is no private property? What happens when all power is centralized? That is what Lawson and Powell uncovered when traveling around the world.
The World as a Case Study:
While Lawson and Powell travelled to many places, North Korea and South Korea are among the best case studies. The two countries started as one: one people, one culture, one history, and one language. However, what they have ended with (that I am sure most everyone is familiar with) are two very different outcomes due to one being a communist society. You may be thinking to yourself right now that communism is not socialism. The sad truth is that socialism is on a continuum that ultimately leads to communism.
Another place that Lawson and Powell studied is Cuba. They found that while there were some “private businesses” in Cuba, they had no interest in creating value for customers because there was no incentive. Their menus were severely limited due to the government having all control over means of production and their storefronts didn’t even have signs because there was no point in attracting customers. Lawson and Powell explained that while they were very disappointed in the service and selection, those things were viewed as a luxury by the locals that could never afford them.
My TakeAway:
It is crazy to me that young people still advocate for socialism when there are so many examples around the world clearly showing its weaknesses. I know that the United States is not perfect, but at least we have the power to change. A great point that I gathered from the lecture is that capitalists and socialists want the same thing. We all want everyone to have a fair chance at having a great life. We all want everyone to have access to healthcare. We all want everyone to have safe and stable jobs. What we don’t agree on is the way to achieve those things. I don’t know the answer to this problem, but what I do know is that socialism is not it.
Referenced Lecture:
Socialism Sucks: Two Economists Drink Their Way Through the Unfree World by Robert Lawson and Benjamin Powell
