On Facebook, a friend says he’s tired of hearing conservatives claim the country is heading toward socialism and will ask the next person who makes the claim to support it with a dissertation.

This chart shows government spending as a percent of the economy has long been trending up to less than 10% in the early 1900’s to between 35% and 40% now.

But, even with the growing percent of the economy in the government sector, I may still not call that necessarily ‘moving toward socialism.’ I think a more appropriate term is bureaucratism.

3 thoughts on “Bureaucratism

  1. Socialism can be defined as a centrally (government) planned economy in which the means of production are publicly owned, e.g. by the government.

    As to whether or not the government “owns” the means of production, I propose that a more fitting definition is who “controls” the means of production. Our federal government has encroached on the ownership of the means of production through its ever growing (both in number and intrusiveness) list of regulations that control the means of production. This has gone far beyond governing by the consent of the people. This week, we have learned that our president (lower caps out of a lack of respect for the man) has decided to bypass a Congress that refuses to obey his diktat and issue his own edict controlling the production of electrical power. – all because he purports to know (better than the people or their elected representatives) what is in their best interest.

    Mises and Hayek argued that central planning was bound to fail because central planners could not possess the knowledge possessed by the market. Oskar Lange, a Polish economist, argued against their reasoning and insisted that central planners could possess the information. In doing so, however, he added that “the real danger of socialism is that of a bureaucratization of economic life.” In essence, he realized that the failure of socialism stems not so much from a lack of “information,” as from the lack of motivation or incentive to respond appropriately to the market signals.

    So, from the standpoint that government (as opposed to private individuals) controlling so much of the economy does not necessarily mean there is a problem, I would agree – if government bureaucrats had the proper incentives to act prudently and could be trusted not to abuse their position. However, as I am sure you will agree, the very connotation of the term “bureaucrat” indicates that most people have reason to believe they would act otherwise.

    • Thanks, Mike. This just might be the dissertation my Facebook friend needs to see.

      You nailed it with who ‘controls’ the means of production. My favorite Reagan quote is “All systems are capitalist. It’s just a matter of who owns and controls the capital – ancient king, dictator or private individual.”

      I wrote more about it here: https://ourdinnertable.wordpress.com/2011/02/08/who-controls-the-capital/

      And, as a surprise to myself, there I explain why I try to avoid discussions about what to call society.

  2. Seth – Here’s an example of de facto socialism where the legal owner of the means of production lacks true control of the means of production. The government is the effective owner of this man’s “private” business – it can tell him what he can and cannot make and evidently to whom he can and cannot sell. As in feudal days, the lord (government) permits its obedient serfs to keep an ever decreasing portion of the fruits of their labor in exchange for existing in the lord’s domain and receiving his protection.


    Are we headed towards socialism or serfdom (or whatever term you prefer)? The essential point is that we are increasingly “giving up” our rights and freedoms in exchange for the promise of security from our “lords”. Some people have eagerly and actively jumped on the bandwagon either because they have consumed too much of the Kool-Aid or because they have weighed their options and realized it’s a better deal for them to be recipients of the wealth transfer (in exchange for their vote) than to take the riskier approach and aim for their own success. Others don’t like what they see, but don’t see a way out. Eventually, the government’s promise of security will be seen for what it is – an empty promise aimed at empowering and enriching the promisers.

    Sadly, this story has played itself out numerous times and in numerous countries and people SHOULD be able to see that it will be no different this time. Two things cloud what should be obvious to all. First, the left’s strong influence in schools has pushed the liberal agenda while the dumbing down of our schools has left many citizens with no clue regarding history. Second, the incentives to become a taker rather than a maker have encouraged even those who might recognize and understand the historical parallels to opt for serfdom with the hope that it won’t be that bad and that the ultimate collapse is further down the road than their own lifetime.

    NOTE: The issue with the wedding cake has nothing to do with whether or not one supports gay marriage, but with the property rights of the owner of the property.


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