After the Soviet Socialist empire collapsed in the early 1990s, many pundits jumped to the conclusion that socialism is dead and we no longer need to pay much attention to it.
They are right, in the sense that as an economic model, socialism is dead.
As an emotional response to trouble, I think socialism is more alive now than ever, and the wise investor will study it in depth.
My evidence? In recent months, I've seen numerous calls for "stimulus" by staunch conservatives who are so frightened, they cannot bring themselves to allow the shakeout of the malinvestment to continue. The cover of the Feb. 16 issue of Newsweek declares, "We Are All Socialists Now."
For thousands of years before the 20th century, the "extended family" was the norm. Parents and grandparents lived with or near their offspring, in tribes or clans.
It is not hard to imagine some of their economic practices, particularly specialization of labor, and the child-rearing routine growing from it.
The healthy young parents were out every day doing the dangerous, exhausting work. Males were risking their lives hunting mastodons, and women were dodging rattlesnakes in the effort to dig up roots, and squirm through briar patches for berries.
With the strong young parents doing the heavy lifting, the child-rearing was left to older members of the family, the grandparents.
It was a great system for raising kids. The parents were too young to know much, but grandparents had some wisdom, including, very likely, skepticism about fads.
…family life changed drastically. The Federal Reserve's stop-start monetary policy caused hot and cold spots to dance all over the landscape. Extended families were destroyed as the members scattered to the four winds in search of jobs.
All that remained was the "nuclear" family. For the first time, children were raised by their parents. Grandparents, who often lived hundreds or thousands of miles away, faded from the child-rearing scene.
Parents realized they didn't know much and began reading books and articles about child-rearing. These items were written by "experts."
That's when today's economic Godzilla was hatched.
Socialism had become the latest craze – the hot new political and economic fad – and like other intellectuals, the child-rearing experts had bought into it.
The opportunity left by the breakup of the extended family enabled these socialists to take advantage of the naiveté of young parents.
The experts spun off various child-rearing ideas based in socialist theory, but rarely disclosed this bias in their writings. Socialism was known in those days as "scientific socialism," and the experts said they were not being socialistic so much as they were being scientific.
Thus, the World War II generation was unknowingly raised under these socialist theories, which they passed along to their kids – the baby boomers – and so on thereafter.
…is that the child's mind is the property of the state. The plan is that the mind should be programmed for statist purposes, to produce a harmonious society in which each person is a well-disciplined cog in the machine, and the machine is guided by – you guessed it – professional socialists.
The objective was to raise a nation of sheep who would understand nothing except their jobs and, perhaps, sports and entertainment.
In other words, each child was to be raised as a flaming statist with complete faith in the government's ability to plan and organize the economy. No one said it so bluntly, but that was the scheme. Like the socialists in China and the USSR, those in the U.S. were trying to create "the new socialist man," who would believe everything the government said and follow its every order.
In case parents botched the job, the education system became a backup. Schools in Gary, Indiana had been converted to a regimented, mass-production system, called platoon schools. In 1914, this merciless "Gary Plan" was adopted by the Federal Bureau of Education, then foisted onto the whole country. It's the system we have today.
In the 1940s, socialist George Orwell jumped ship and tried to warn against the brainwashing in his novels Animal Farm and 1984, but he was too late. The last generation to be raised outside the great socialist experiment was born before 1910.
When that generation went to their graves, they took with them thousands of years of accumulated grandparenting wisdom. This wisdom was replaced by the ruthless procedures for creating the new socialist man.
…of the three baby-boomer presidents – Clinton, Bush, and Obama – I think you will see the middle-aged results of this kind of upbringing: an unquestioning religious faith in political power. The solution to every problem is more government.
These presidents are not unusual. In millions of cases, the socialists were successful in creating their new breed of human.
And today, as you read this, some of their star pupils – or maybe I should say star victims – are in the White House and Congress, deciding what will happen to the rest of us.
|You can't make socialists out of individualists. Children who know how to think for themselves spoil the harmony of the collective society. – John Dewey, 1859-1952, socialist, "father of modern education," member of 15 Marxist organizations, and admirer of Soviet education.|
…what they are likely to do to us economically. It all leads to the same place, more power for the government and less freedom, peace, and abundance for us, until the economy collapses under the burden — because socialism does not work.
In other words, even in the most conservative Republican households, the World War II generation and all subsequent generations have been raised as guinea pigs in a grand socialist experiment, and very few of them realize it.
Some of us fell through the cracks — readers of this newsletter, for instance — but nearly the whole population has been raised to be worker bees in a vast hive, and to expect the queen bee in the White House to do their thinking for them and solve their problems.
This process was repeated almost identically all over the world because, for roughly a century, nearly all intellectuals were socialists. And grandparents, who had some wisdom and skepticism, had been removed from the child-rearing mix.
|The trouble with socialism is that you eventually run out of other people's money. — Margaret Thatcher|
…is the beginning of the failure of the global socialist experiment. The entire world population is starting to realize that all the queen bees in all the world's capitals are as lost as they are.
I think the psychological shock will be similar to that experienced by freed slaves at the end of the Civil War. Millions will have no idea how to get along without an owner to tell them what to think and do.
Again, socialism was originally called…
A member of the WWII generation once told me about her mistakes. She said scientific child-rearing was all the rage when her baby boomer children were young. And the experts made her paranoid about germs. Following their instructions, she kept her first child's environment as sterile as possible.
In the crucial early years of his life, she rarely touched her child for fear of contaminating him.
Long after, she realized a more mature woman would never have fallen for such cold-hearted nonsense.
In addition to an obsession with cleanliness, parents were taught that right from birth, children should be instilled with strict discipline and should not be "spoiled" by hugging them when they cried.
All children were the same and required no individualized rules or care. Sweeping generalizations – such as, children need… and children should be – were applied wholesale to millions around the world. And this woman followed these generalizations.
As the sapling is bent, so grows the tree. Ever since that conversation, I have wondered about the crazy, mechanistic social-engineering schemes governments have foisted onto us, especially the Federal Reserve's monetary policies. How many of these brutal schemes have been created by politicians and bureaucrats who were raised in that frigid, mechanical, neverhug-the-child way? Are these people cold and distant, incapable of caring about those they are harming?
Dr. Benjamin Spock became widely hated for trying to remove the callousness from child-rearing.
Again, as the sapling is bent. And if we judge a tree by its fruit, then the people in charge of economic policy certainly must be bent.
When we were teachers, my wife and I met many an educator who was like that. They were machines, obsessed with doing everything the Right Way, no matter how much harm it inflicted on a child who needed to march to a different drummer.
In some cases, these teachers' heads were conservative Republican, but their hearts were of the finest socialist granite.
…this awareness that we are all part of a century-long socialist experiment, may be of some help in averting domestic discord. Remind yourself often that in the most important years of your life – the first 10 – you and your spouse were probably raised by very young people who were totally baffled and much better-suited for picking berries and battling mastodons than caring for children.
Over the years, I have seen many dozens of children raised by people who were, themselves, still children.
…one of the victims of the great socialist experiment, here are some of the books that helped me realize that statism isn't the only way to view the world…
• Planned Chaos by Ludwig von Mises.
• Road to Serfdom by F.A. Hayek.
• What Has Government Done to Our Money? by Murray Rothbard.
• Capitalism, the Unknown Ideal by Ayn Rand.
…regardless of how smooth and caring government officials look on camera, they will continue being ruthless and unfeeling, because they would not have their jobs if they weren't.
These people are Dr. Frankensteins, conducting a social-engineering experiment in which you, me, and those we love are their guinea pigs.
Anyone who thinks these Frankensteins will do something that's good for the guinea pigs must have been born yesterday. The Frankensteins will do whatever they think is necessary to make their vile experiment work.
Remember the comment by Obama's chief of staff Rahm Emanuel… He said today's economic tragedy is "an opportunity to do things you could not do before… You never want a serious crisis to go to waste."
Socialist guru Aleksandra Kollontai (1872-1952) once wrote that, after a woman has a child, "she no longer belongs to herself, she is serving the collective, producing from her own flesh and blood a new social unit of labor."
So there you have it. When you and I were children, we saw ourselves as children. To the pediatric and educational experts guiding our unsuspecting parents, we were social labor units.
As an economic model, socialism is stone dead. It does not work. It's an economic Godzilla. But as an unconscious, cold-hearted knee-jerk reaction to trouble, socialism is thriving. It's how we were raised.
I am beginning to suspect that we are entering the most chaotic period in human history. Again, I can't think of any way this economic calamity won't lead to riots, and I hope you are building your emergency preparations. I plan to stay with you all the way and do whatever I can to help you prosper. I hope you will warn everyone you care about.