Capitalism Saves Lives. Socialism Destroys Them.

You cannot put lipstick on a pig. I don’t care what kind of socialism you are peddling and if you tell me it’s “values based” the only way it works is if it enforced at the tip of a spear.

Socialism has murdered millions of people over the past two centuries. Millions. Don’t tell me the next time it is tried we will get it right.

I recently read three articles that should inform this view if you think I am off base.  I also saw Arthur Brooks give a talk on the value of work and the value of just having a job.  Even if it’s street sweeping for $1/hr.

The first article I read was on the demise of Sears. The execs at Sears made some pretty poor business decisions, especially given the benefit of 20/20 hindsight.  But, this article wasn’t about that.  Did you know that Sears founder Julius Rosenwald used capitalism to fund schools and fight Jim Crow. Interesting that Amazon ($AMZN) founder Jeff Bezos is spending a couple of billion on schools for the poor. He received a lot of backlash from the chattering class who embrace socialism.  I pulled this quote from the article.

Since ordering through the post offered consumers anonymity, Sears had almost no idea which of its customers were black and which were white, ensuring that each customer was treated equally. So long as you had the money to pay for an item, the item would be shipped to you. But this helped with more than just clothing and household goods.

Few people remember that Sears used to sell actual homes, as well. After sending the materials via mail, the buyers would then assemble these homes on their own. And for black families looking to own homes in the segregated South, this helped bypass the scrutiny of those who refused to sell or build homes for anyone who wasn’t white.

In Term Sheet at Fortune, Cyan Bannister said capitalism saved her life. She is a partner at Founders Fund. I pulled these quotes but the entire interview is worth reading.

Like many people, I am a child of public education, and in school they don’t teach you much about capitalism, so you learn based off of gut instinct. If you’re someone who cares about other people, you think that corporations are evil, people who have lots of money are evil, and wealth distribution should be a thing because it seems like the only fair option.
If I had gone out in the world saying, “I want my fair share,” I probably would’ve had a very miserable time. Instead, I started working and realizing I was working for business owners. It’s easy to say, “They’re business owners, therefore, they’re evil and greedy,” but instead, I started seeing them as heroic. I started to understand that this entrepreneur has put everything aside in their life to start a record store so that I could have a job. And that’s when I started realizing that this capitalism thing wasn’t so bad after all.
That was the wake-up call I had as a kid where the entrepreneur became this heroic figure in my life versus seeing them as the Antichrist. I mean, all of my friends saw every business owner on the planet as someone who was trying to exploit labor.

The pivotal moment was a paycheck. Literally, it was a paycheck. I realized that if I work hard, I get this check, and with this check, I can build my own businesses and lift myself up out of poverty.

If we want to have empathy and compassion for people, we have to create jobs for them. That’s why a lot of the public policy on the books and proposed today is harmful. Minimum wage is one example but there are licensing laws on the books that stop people.  Public policy is actively putting a rock around their neck.

The third article I read was about summer jobs.  Getting a paycheck is big. How do you learn? Like most people in my generation I got summer jobs. In college, I sold shoes at night and worked construction during the day. It wasn’t skilled labor. Mostly I was busting concrete, picking up stuff and moving it, picking up garbage from lots, taking it to the dump in a pick up truck, painting, and moving dirt. But, it was a job. Kids today can’t get summer work for a lot of reasons.

In July 2017, the combined labor force participation rate for 16-24-year-old men and women was only 60.6 percent, down from the high of 77.5 percent in 1989. Unless this downward trend changes, more and more young adults will suffer the consequences of delaying employment.

Why are summer jobs valuable? Competency isn’t something we are born with, it’s something we need to develop. We can only acquire so many lessons in school, and working creates other opportunities to learn.

You want to cure the student loan crisis?  Let kids get work and let them work their way through school.  In undergrad, get as high a paying job as you can and don’t worry about a free internship.  Save that for grad school.  Plus, we need to end a lot of the subsidies we give colleges so they reduce their headcount and can cut expenses, dropping the cost to attend.

Capitalism works.  Socialism always fails 100% of the time.