Tag Archives: capitalism

The Problem with Socialism

Dawn J. Bennett, founder and CEO of Bennett Group Financial Services, recently interviewed Tom DiLorenzo on Financial Myth Busting with Dawn J. Bennett. DiLorenzo is an economics professor at Loyola University Maryland Sellinger School of Business and the bestselling author of The Problem with Socialism. In his interview with Dawn J. Bennett, DiLorenzo discusses his bestselling book and the numerous issues with socialism.

Socialism in Scandinavia

DiLorenzo’s book debunks the common myth that Scandinavian countries are proof socialism can work, an argument that Bernie Sanders made in an earlier Democratic debate.

According to DiLorenzo, while Sweden was one of the most prosperous countries in the world from the late 19th century until about the 1940s and had the highest per capital income growth of any country during that time, the nation destroyed its job growth.

“They started nationalizing some of their industries; they adopted a very large welfare state, and a heavily progressive income tax. That was their version of socialism,” explained DiLorenzo. “As a result, Sweden did not create one single net new job from 1950 until 2005, according to the Swedish Economic Association. They destroyed job growth. So Bernie Sanders had got it all wrong. The only reason why Sweden was once prosperous is capitalism, and not socialism. Socialism killed prosperity in Sweden.”

Socialism and the Environment

DiLorenzo also disproves the popular misconception that socialism is better for the environment, compared to a loosely regulated free market.  A chapter in his book, “How Socialism Causes Pollution,” is dedicated to this poor argument.

“The basic theory of the cause of pollution is that it’s unregulated free markets, and the pursuit of profit leads to pollution,” DiLorenzo tells Bennett. “Well, the socialist countries of the Soviet empire outlawed profit seeking for 70 years. So when we had the collapse of socialism all around the world in the late 80s, early 90s, and people were finally able to go and look around these formerly closed societies, they found that they had the worst ecological catastrophes in the whole planet, far worse than anything we’ve ever seen here.”

He continued, “There was even a book written called Ecocide in the USSR, ecological suicide. We heard about things such as boats on the Volga River having signs on them saying don’t throw cigarettes overboard, the river may catch on fire, because there were so many chemicals floating down the river. The problem was the absence of property rights. When nobody owns property they tend not to take really good care of it. To relate to that idea ask yourself who takes better care of cars; people who rent cars, or people who own their own cars? If the society has an absence of property rights then you really have a lot more ecological damage than you do in a capitalist society. Besides that, the wealthier countries are always healthier and cleaner.”

To view DiLorenzo’s full interview on Financial Myth Busting, click here.

 

True Free Market Capitalism – Can We Obtain It?

The elusive goal of obtaining free market capitalism seems extraordinarily difficult at times.  The level at which government is involved in the economy currently makes it seem almost impossible at times for it to be effectively extricated without causing major financial problems.  One hope for enacting real change could be the electing of candidates whose values truly align with free market capitalism.  This appears to be a possibility as candidates for the 2016 presidential race have begun announcing themselves.  In order to explore this issue of free market capitalism and a couple candidates which look promising Dawn J Bennett invited Jonathan Hoenig, a founding member of the hedge fund Capitalist Pig, to her radio show “Financial Myth Busting”.

Dawn J Bennett got right down to business and asked Jonathan who he was excited to see had thrown their hate into the race.  His two current favorites are Ted Cruz and Rand Paul.  Jonathan explained that the majority of politicians, even those on the right aren’t radical enough when it comes to dealing with the economy and implementing real changes.  He feels that despite many supporting capitalism it’s not in a purist sense of the form.  Jonathan even told Dawn J Bennett that he is worried that despite some of what Rand Paul says he may not actually truly hold those ideals.

Jonathan also believes along with a lot of others that repealing of the IRS, Medicare and Medicaid needs to happen.  So long as they exist a free market cannot truly exist because the government will be too deeply involved in the economy.  The problem with the IRS is the numerous loop holes and how it treats everyone unfairly.  The reality is the government could save money by repealing the IRS and having an equal flat tax on everyone.  The problem is a majority of people don’t believe this will work and have the mistaken view that true capitalism is a “dog eat dog” world.

Jonathan says in addition to abolishing those government agencies the minimum wage needs to be done away with, he claims the country’s most prosperous years were in the 1800s and late 1800s before government became so intricately entangled with the economy.  In regards to Hillary’s campaign Dawn J Bennett and Jonathan agreed that the news media is too focused on pointless matters like where she eats and what she’s wearing each day.  Once this dies down and people begin focusing on what she’s really about they will see wealth redistribution is what she’s about.  Unfortunately a lot of people in America currently believe this is the appropriate role of the government.

Dawn J Bennett also brought up Hillary’s comment about getting the money out of politics despite her plan to raise an estimated $2 billion for this upcoming election.  Jonathan conveyed that any candidate running will need to raise large sums in order to effectively advertise and get their name out there.  The real key to he says to removing money from politics is removing government from the economy.  When government policies are no longer affecting the economy like they do now, the desire to spend money on politics will be removed.  As it currently stands though government helps create monopolies and if a business doesn’t lobby they can be lobbied out of business by their competition, therefore not lobbying can lead to suicide of the company.

At the end the question we are left with is will the people of the United States continue being misled down this path which will damage us in the long term or will we return to our roots of a true free market.

Bennett Group Financial Services LLC, based in Washington, D.C., is a comprehensive financial services firm committed to providing opportunities to clients’ as they seek long-term financial success. Its customized programs are designed with the potential to help grow, lower overall risk and conserve client assets by delivering a high level of personalized service and skill.

For more information, call 866-286-2268 or visit http://www.bennettgroupfinancial.com

Securities offered through Western International Securities Inc. (WIS), member FINRA/SIPC. BGFS and WIS are separate and unaffiliated entities.

About Dawn Bennett

Dawn Bennett is CEO and Founder of Bennett Group Financial Services. She hosts a national radio program called Financial Myth Busting http://www.financialmythbusting.com

She discusses educational topics and events in the financial news, along with her thoughts on the economy, financial markets, investments, and more with her live guests, who have included rock legend Ted Nugent, as well as Steve Forbes and Grover Norquist. Listeners can call 855-884-DAWN a as well as take podcasts on the road and forums for interaction.

She can be reached on Twitter @DawnBennettFMB or on Facebook Financial Myth Busting with Dawn Bennett or dbennett@bennettgroupfinancial.com