Its rare that I disagree with David Boaz over at Cato, my more usual attitude is the doffed cap and tugged forelock of the peasantry meeting the gentry. However, Im afraid that Boaz is actually wrong here about Venezuela and what is causing the laughable (for us outside the country, not so laughable for those inside it) shortage of toilet paper. This isnt the result of socialism, this is the result of anti-marketism. This is an important distinction that we have to make: however much those to the left of us (and given where Boaz and I are on the spectrum, thats most of humanity) confuse these two things capitalism is not the same thing as a market based economy nor is socialism the opposite of one. Theyre descriptions of things that are operating on different axes.
Heres what Boaz actually says:
Venezuela Reaches the Final Stage of Socialism: No Toilet Paper
Shortages, queues, black markets, and official theft. And blaming the CIA. Yes, Venezuela has truly achieved socialism.
But what I never understood is this: Why toilet paper? How hard is it to make toilet paper? I can understand a socialist economy having trouble producing decent cars or computers. But toilet paper?
Well, yes, I was in the Soviet Union at the same time of Boazs first visit and yes, it was something difficult to find. As it happens I was at an exhibition of Czech 1980s living standards a few weeks ago where a friend took this picture:
(Picture credit, Miroslav Balej) That block on the right hand side, about the size of a bar of soap, is in fact 200 sheets of the standard toilet paper of the time and place. So, maybe we can claim it is socialism that causes this?
Except, in the case of Venezuela at least, this isnt what has gone wrong. Sure, some of the bits of socialism that have been imposed have had the usual predictable effects but the toilet paper thing isnt one of them.
Just to clarify our terms here, socialism and capitalism are two competing descriptions of who owns the productive assets. In capitalism its the capitalists, in socialism some social grouping. It can be the state, most certainly, in state socialism as the Soviets had it. It could be the workers themselves in an organisation, as in a workers co op (say, Mondragon in Spain). It might be the customers (say, Building and Friendly Societies in my native UK) and it could even be the management (just about every law firm ever). But our differentiation here is of who owns the capital.
Theres no particular reason to think that capitalism is the best answer for all areas of the economy and there are good reasons to think that socialism isnt a good answer to all areas of the economy (most especially large, capital hungry, enterprises). We can usually just leave this to experimentation to find out. Youd be surprised how much of the economy is actually socialist in this sense: Goldman Sachs, until it listed on the stock market a few years ago, would have fit into this definition of socialism. It was a partnership, owned by the management.
Excerpt from:
Venezuela's Not Suffering From Socialism But From Anti-Marketism