(From yesterday’s issue of the Tom Woods Letter, which all the influential people read. Subscribe for free, and get a free libertarian eBook at the same time, at TomsFreeBooks.com.)
I spent Tuesday night talking to students at UC Santa Barbara about the true record of communism – a chunk of history a rather substantial portion of Americans know nothing about.
Toward the end of my talk I said: even if some Marxists out there try to claim that none of the regimes I’ve discussed tonight constitute true Marxism, I can nevertheless show that their so-called pure Marxism would still be a disaster.
So I discussed the socialist calculation problem, as explained by Ludwig von Mises. If the factors of production are owned by a single entity – whether the state or “a vast association of the whole nation” (whatever that means), as Marx put it – then they can have no prices.
You don’t buy things from yourself. You don’t sell things to yourself. Likewise, the entity that owns all the means of production wouldn’t be buying or selling them, and therefore prices never arise.
Without prices, there is no way to decide between production processes involving incommensurable factors of production. There is no way to decide, among a practically infinite array of resource combinations, which one satisfies consumer preferences at the lowest cost and the least waste. There is no way to calculate profit or loss, and therefore no way to know if a firm is adding value (making us better off) or subtracting value (squandering resources).
After I finished, a Marxist stood up during the Q&A and challenged me.
Some of the challenges were trivial: he defended Lenin against the charge of oppressing Ukrainians, when I had in fact blamed that on Stalin.
But he thought he really got me when he said, “Marx did talk about prices” in Das Kapital.
Evidently he took “there can be no prices of the factors of production under pure Marxism” to mean “Marx didn’t talk about prices.”
Certainly Marx did talk about prices, particularly consumer prices. That has nothing to do with it. The point is, his system cannot have meaningful prices of the factors of production.
This means that any economy based on Marxist ideas will yield hideous results – and we hardly need to stretch our imaginations to think of how Marxist regimes might try to deal with these results. For Lenin the answer was generally the firing squad, and I see little reason to expect anything different from any other Marxist.
Today’s episode of the Tom Woods Show builds on yesterday’s, and walks you through the Bolshevik Revolution – not the romantic, sanitized version you hear from Marxists, but the real thing in all its terrifying brutality.
A noble experiment?
You have to be kidding.
Listen:
https://tomwoods.com/ep-1105-dont-pine-for-the-original-principles-of-the-bolshevik-revolution/
And by the way, I was very glad to hear so many people at that event say, “I’m a member of the Tom Woods Show Elite!” Thanks for being out in force. Not yet part of our cool group? Entry here: http://www.SupportingListeners.com
