Chap 5 Flashcards
How do we Socialize Cost/Value?
We spread it to society.
An advocate of Socialism…
asserts that the individual should act to promote the good of society; not to promote the individual’s wellbeing.
Karl Marx
the founder of socialism, stated Production should come, “from each, according to his ability, to each, according to his need.”
Authoritarian Choice
Where state’s decisions are determined by the elected/forced officials. The alternative to individual economic freedom.
Two Types of Rationale for Socialism
- Firms have more power than individuals, so they exploit individuals
- Fairness, working class individuals are forever disadvantaged, therefore classes must be controlled to ensure, “fairness”
Modern Day Rationale consists of….
We must socialize external costs, costs that naturally spill over to other (markets industries)
External Costs
Costs that naturally spill over to others (market industries)
Externalities
External Costs and external Benfits
efficient assessment of external costs and benefits must be
done by those who have knowledge of all facets of the economy and nothing to gain from the regulatory process
If individuals do not agree with state decisions, the state can respond by either;
- Allow Individual Choice
- Use force and the threat of force to maintain the socialist order
Fascism
a System under which the state does not take title to property, but orders the use of that property and the individual in any way it wishes
Eminent Domain
Property is taken for public use, such as roads and parks but the owener is compensated
Civil Forfeiture
A persons property is seized because they are automatically associated with a crime
When government spending grows to 20% of the economy
the state has become 20% socialistic
“the pursuit of happiness”
The right to hold and use property freely, to choose one’s profession, to make contracts, and to travel
