In the same radio discussion that I mentioned in my previous post, I heard the radio talk show host say that socialism — and variants of it — has been responsible for millions of deaths and has proven over and over to be a failure. He encouraged the self-described socialist to read some history.
I hear this point made on occasion. I find it frustrating because rarely is it mentioned why socialism fails.
Why does it?
I believe it’s for a couple main reasons.
There’s the knowledge problem. A free market of prices communicates vastly more and better information to allocate resources better than any small group of people can.
I also believe it stifles risky experimentation, which is the source of most innovations, large and small. Without risky experimentation, society rots. I’m not sure, but I think this may actually be a subset of the knowledge problem.