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The Escape From Collectivism

by Doug Casey, International Man:

Recently, I penned an article entitled “A Chicken in Every Pot,” which described the reasons why countries that have delved into collectivism are likely to slide further down the slippery slope once its addictive qualities have been introduced to the brain.

Since then, I’ve received requests to address whether it’s ever possible to fully escape collectivism once it has taken hold in a country. The short answer is “yes.” It’s always possible to kick an addiction, but it’s not easy nor without pain.

There are two forms of exit from collectivism. The first is national; the second is personal.

Ending Collectivism Nationally
Russia has crawled out of the collectivist tar pit, but not before an economic collapse in 1991. The political leaders that were responsible for the reinforcement of collectivism were able to bail out and retire in comfort to their dachas, whilst the hoi polloi suffered the pain of collapse and slow recovery.

East Germany made a concurrent recovery from collectivism but had a bit of help from the more free-market West Germany after their reunification. (This fast-track form of recovery is rare.)

The German recovery is especially notable, as the West Germans eagerly encouraged the East Germans to join the job market and otherwise participate in the then-vibrant West German economy. The initial result was that, whilst East Germans looked forward to the opportunity to have more money, better jobs, bigger apartments, and luxuries like new cars and televisions, they began whingeing immediately at the longer hours and increased productivity expected by West German employers. They were also miffed at the loss of holidays, extended paid leave, medical benefits, and other unrealistic collectivist perks that West Germans did not receive.

However, most Germans were of the same race and ancestry, so the East Germans could not cry, “discrimination.” As a result, they got on with the changes. However, the change in mindset was slow and, to this day, some older East Germans still grumble that they had hoped to gain free-market advantages whilst hanging on to collectivist perks.

But, again, this is an anomaly. Generally, for an entire culture to rid itself of the addiction to collectivism, collectivism itself must play out. As Maggie Thatcher said, “the trouble with socialism is that, eventually, you run out of other people’s money.” Collectivism can hang on for decades, bleeding what remains of the free market in a given country, but eventually, it’s left with a bloodless corpse. At that point, the government can no longer deliver on its “entitlements,” because collectivism is not a productive system—it is a parasitic system.

In most cases, in collectivism, like alcoholism, the country must bottom out before the realization sinks in that the addiction simply doesn’t work. A textbook case can be seen in Cuba, where the system was slowly bled dry by collectivism, and the Cuban people remained at the bottom of the prosperity curve for many years before they took action. Although the government remained staunchly collectivist, the people slowly created a black market, providing goods and services to tourists. Over time, thousands of people operated small restaurants and offered their houses for rent illegally to tourists.

It’s important to note that the government did not change its view of what sort of system they wanted. On the contrary, they determinedly stuck to oppression until the black market was so rampant that it could no longer be controlled. The government then did what all governments do to what they cannot control: tax it.

New laws were passed to provide the cuentapropistas the right to operate restaurants, guest houses, and taxis, but they now had to pay a fee to the government to do so. Over time, the number of cuentapropista private businesses swelled, and so did the government coffers. At this point in time in Cuba, the government is engaged in a wrestling match with itself. It’s resisting the passage of greater freedoms in order to maintain maximum control whilst at the same time legislating greater freedom to create a free market that will provide the government with greater revenue. (After all, the Castro concept is still officially the policy, but each bureaucrat wants to get rid of his rusty old Russian Lada and get a shiny new Hyundai, paid for by the cuentapropista revenue.)

Although the world at large does not realise that this change is taking place, it’s truly a non-violent revolution that’s being generated by a people who had nothing left to lose.

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2 comments to The Escape From Collectivism

  • Craig Escaped Detroit

    I am concerned how deeply the distribution systems (groceries, fuels, medical care, etc) may break down during the next crash.

    As they say, PREPARE for the worst, and HOPE for the Best… and NEVER get it backwards.
    (Prepare for the Best, and HOPE that nothing BAD Happens.)

    50 million Americans on FOOD ASSISTANCE. That is a Zombie Apocalypse right there!
    The “food banks” are not going to be able to handle it. They already turn away many many people.

    Stopped at a very nice, large grocery store today, looked around at the wonders of some American grocery store efficiencies. Fruits & Veggies section was wonderful. Dry foods also wonderful. Canned goods varieties? Wonderful. Meat counter, deli, hot foods and bakery section, dairy isle, frozen foods, ALL very wonderful.

    If we become like Venezuela, it’s gonna be very bad. Get those garden supplies stacked, and plant those seeds.
    Don’t worry, (Be ready), be happy.

  • Ed_B

    Good advice @Craig

    I am always happy when working in the garden. It’s almost a spiritual experience when one works with the soil of the earth to bring forth new life that will sustain us. My garden is small but it is very productive. I can’t believe all the food that my 32 x 16 foot plot can produce. It is pretty amazing. Not that I am the world’s greatest gardener or anything but the soil is good and it is well tended. It almost can’t help but produce. Green beans, corn, squash, potatoes, peppers, tomatoes, onions, cukes, and even a few eggplants that I grow for my daughter and grand daughter. They love making eggplant parmesan. 🙂

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