Does Collectivism Work?

Historically it “works” for approximately 70 years or so. Then the collectivistic arrangement of gathering from those who have and reallocating it to those who have not fails and historically fails miserably.

Why, you might ask?

Well, I believe the Ludwig von Mises elucidated the reason best when he wrote “The market is not mankind, the state, or the corporative unit, but individual men (women) and groups of men (and women,) and their valuations and their actions which are decisive, not those abstract collectives.” [i]

Every one of us approaches any subject matter from our own point of view… a point, which I might add, has been painted essentially by our own unique valuations. It is these valuations which, in a free society, create the social and economic bases in which we live.

When, therefore, a majority of a free society believes that an even distribution of goods and services should be the norm, a society moves towards socialism. When socialism has played its course however and those in position of authority responsible for collecting, distributing and regulating production have behaved like every human being always behaves and have collected more than they have distributed, the system fails and fails miserably. Miserably because now the society, as a whole, has become less productive having become dependent on the reallocations of wealth and therefore more dependent on regulators to inform them what to do in almost every aspect of their life. At this point there are very few, except those in the role of collectors, who have anything left to risk future production with.

Historically, it is at these times that regulators can no longer maintain control enough to enforce the necessary collections and the redistribute wealth runs thin or expires completely. At such times certain individuals begin to behave in a more self-responsible way…taking on risks in the hopes of future potential profit. Others reduce themselves further in society through means of theft and robbery.

Those who begin to behave in a more self-responsible way are no longer protected against the risks they assume because these risks are not regulated or controlled. But then again, and for these very reasons, the potential profits are greater than when an even distributional system of profits is in effect. And it is because of these higher potential profits that individuals are willing to assume greater risks attempting things which under a collective society would never have been attempted. As a result of these individual valuations society advances and new developments are discovered and more of the individuals of any given society are benefited from these new discoveries. Whither the discovery is the printing press, the farm tractor, the telephone, the automobile, the iPad, etc. The idea is that more and more individuals are able to produce and benefit and benefit others around them with their production without the need of regulation and collective means to allocate that production.

Overtime however, individuals, and groups of individuals, may forget the values which produced the improvements which they enjoy in their current economy and society. They may again begin to look upon those who have assumed high risks to discover and develop improvements as greedy and self-serving. When the number of these values attains a majority then society again drifts towards collectivism.

The point here is clear. It is values which create the societies’ atmosphere in which we live in. If you don’t like the present atmosphere examine your values. Because it is your values, along with other individual values, which have created the society and the economy in which you live. If you want change then you are the place to start. If you begin with your own values then others will have the courage to join you. If you don’t have the courage to examine your own values then you deserve what your society currently offers.

Here at Life Benefits, Inc., we’re not satisfied with the current atmosphere in our society, nor are we happy with the direction it seems to be heading. But we believe that our economy and society can and will get better in the future. That is why we have assumed the risk of everything we believe and everything we own, in order to make that change happen. If you want to join us in making that happen, one individual at a time, then call us today. The risk has been very rewarding so far and it only appears to be improving with every economic downturn announced.

By Tomas McFie
[i] Austrian Economics