Tuesday, March 13, 2007

Highway to Heaven

Hugo Chavez, the President of Venezuela, seems determined to confirm the opinion of those who think him to be little more than a knave and buffoon. This statement which he delivered last weekend suggests that the future of Venezuela is in the hands of a man completely oblivious to modern economic realities:

"Those who want to go directly to hell, they can follow capitalism," Mr Chavez said in the town of Trinidad in Bolivia. "And those of us who want to build heaven here on earth, we will follow socialism," he added.

Which country, especially in the Spanish speaking world, has ever followed socialism to heaven on earth? How many times does the left have to relearn the lesson that attempts to coercively establish socialist paradises almost always end in firing squads, tyranny and dystopia.

On the other hand, though their achievements are certainly more modest than the establishment of "heaven on earth," the greatest engines of high standards of living for all its citizens have been capitalist societies: England in the 19th century, the U.S. in the 20th century along with Asian economic successes like Hong Kong, Taiwan, Japan, South Korea, and Singapore. Historian Rodney Stark makes the point exceptionally well in his book The Victory of Reason: How Christianity led to Freedom, Capitalism, and Western Success: Everywhere free markets and private property are protected there is prosperity, at least until governments can no longer resist the temptation to levy onerous taxes and kill the goose laying the golden eggs.

Socialism deadens economic growth because it sucks wealth from those who produce it and thus provides not only a disincentive to produce (why create if the state is going to take it), but it also prevents businesses from investing in improvements and research and development because the funds needed for these projects have been siphoned off by a parasitic state. Socialist governments kill off wealth production in other ways by burdening businesses with heavy regulations, onerous paper work, litigation and other barriers to success that businessmen find too difficult to surmount. Often they just give up, sell their businesses, and get a government job so they can live off the tax revenues imposed upon their former colleagues.

Socialist countries are often economically moribund, as we see in large swaths across Europe, and although there may be some people, usually state employees, who do well, most who live in socialist societies would dispute Chavez's characterization that they are heaven on earth. When socialism is combined with despotism, as it was in the communist world, and as it appears it may soon be in Venezuela, it becomes a literal hell.

Chavez aspires to be another Castro. No doubt he hopes to turn Venezuela into another Cuba. We should keep the Venezuelan people in our prayers.