Socialism, for Lack of a Better Word, Sucks
Socialism is a hot topic these days. Democratic presidential wannabes, including Bernie Sanders, say they’re for it, and recent polls indicate about 40 percent of American young people are too.
Over the last few years, my buddy Ben Powell, who is a professor of economics at Texas Tech, and I toured the world, drank a lot of beer, and saw for ourselves how things are going in former and current socialist nations. It turns out the quality and availability of beer in each of these countries is an accurate, at-a-glance way to assess their political systems.
Our first stop was Sweden, which Bernie Sanders and others extol as an ideal example of socialism. I’ve got news for Bernie and his crew -- Sweden is no more socialist than the United States. Ben and I have been there, and the beer is good and cold, produced by privately owned companies, imported from all over the world, and sold at privately owned bars at unregulated prices. Those prices are high, because of Sweden’s notoriously high taxes, which are about 50% higher than in the U.S., but that’s not socialism.
Socialism is a system of government in which the means of production and the raw materials are controlled by the government. Think of your least-favorite government office -- is it the Post Office? Or maybe the DMV? Then imagine every business in our nation, from Starbucks to Procter & Gamble to car manufacturers, being run the same way.
What does that do to beer? We went to Venezuela and Cuba to find out.
In Venezuela, the country has actually run out of beer on several occasions. Yes, you read that right. The entire country has run out of beer. How could that happen? The government, which controls the foreign exchange market, couldn’t or wouldn’t allocate enough hard currency for the largest beer company, Empresas Polar, to buy sufficient quantities of malted barley from outside the country.
In Cuba, they had beer, but the central planners in charge of the economy decided they only need two kinds. There is Cristal, a light lager, and Bucanero, a dark, bock-like beer. Both taste like Budweiser that’s been left out in the sun too long.
Our travels also took us to the Chinese-North Korean border. We found plenty of good beer on the Chinese side, because China’s economy is no longer socialist -- it’s pretty much a market economy within a police state. Still not ideal. We call it “fake socialism” in our book.
In China, we found someone selling North Korean beer, so of course we had to try it. Toxic industrial solvent is the only way to describe the taste. If I was unfortunate enough to live in North Korea, I guess I’d drink it out of necessity, and with any luck it would kill me before I starved to death or was executed by the government.
The countries we visited that have given up hard socialism, like China, Russia, Ukraine, and Georgia, are all struggling with hangovers from their socialist days, but their emerging market economies produce good beer -- and wine. The country of Georgia, formerly part of the Soviet Union, has become a wine mecca, and produces some of the world’s most interesting wines using local varietals and old-world techniques.
The last stop on our journeys took us to Chicago, where we attended the American Socialism Conference, and interacted with a mix of avowed comrades and the socialism-curious. We wanted to know why, when socialism has failed in every place it’s ever been tried, people are still devoted to it. Mostly, we found confusion.
Many of the attendees believed (incorrectly) that socialism meant a system like Sweden’s. Some were passionate about social justice causes and thought socialism was the answer. As libertarian-leaning guys, Ben and I had a lot in common with those seeking social justice. We care about police brutality, immigrants, and the environment too, but the people we met at this gathering didn’t understand that state control of the economy would make these matters worse, not better.
While at the conference in Chicago, we drank a lot of beer produced by Revolution Brewery, which employs raised fists and red stars on its labels. Revolution is the largest for-profit, independent brewer in Illinois and produces beer in higher quality and in a vastly greater variety than all of the socialist countries in the world -- combined.
Socialism fails in practice because it is bad in theory. Central planners lack the knowledge and incentives to respond to consumers’ wants and needs. Every place that has tried it has ended up in misery, with starvation and death rather than prosperity. The beer sucks too.
Robert Lawson holds the Fullinwider Chair in Economic Freedom at Southern Methodist University and is co-author with Benjamin Powell of Socialism Sucks: Two Economists Drink Their Way Through the Unfree World (Regnery Publishing).