Why are we so against Socialism?

The Republican campaign has referred to Obama as borderline Socialist on more than one occasion now, and I find myself offended by this accusation for the same reason sensible people are offended by the Muslim “accusation”: What would be wrong with that?

I completely support the idea of Socialism. Or, well, maybe Communism would be more accurate. Unfortunately, people, particularly Westerners, ascribe a stigma to both concepts on two grounds:

1) They can’t fathom why a doctor should make as much as a garbage man.

2) The Cold War kinda sucked.

Let’s address the second one first: The Cold War is over. Get over it. Okay, good.

The first point is perfectly valid, though. It does, however, make the wrong assumptions about the state of mind of the participants and the means of control in the Communism. It assumes that these people are not participating willingly, that the state is forcefully Robin Hooding the upper classes in favor of uneducated slobs who don’t contribute, and that the people in such a society would agree with the idea that a doctor should be granted special privileges. This would not be the case in a true Communism.

The doctor should be rewarded somehow. He’s making a greater contribution to the common good after all. And the useless bum should not be given free wealth so that he can live in the same kind of house as the doctor. But can’t we at least take care of him?

The current concept of Communism is flawed. It is based around the idea that wealth should be equalized — even though, in a real Communism, “wealth” does not really exist — when in fact we should be looking at happiness and opportunity.

I think we can all agree that everyone deserves to be happy. I think we can also all agree that people with potential should have the opportunity to realize it. These basic rights are not universal in modern Capitalisms, though.

Given this, how can we modify the theory of Communism so that it’s a little more viable?

First and foremost: Healthcare. This is barely worth stating. Stop letting people die. Don’t feed people’s drug habits, of course, but if someone is sick or broken and can be fixed, fix them. It’s appalling that this is still an issue in our enlightened age. Personally, I had to shell out $3,000 out-of-pocket in 2006 to live. If I didn’t have health insurance, that would have been more like $20,000. If I hadn’t had the money, I would have died. And people do die for want of the money for medical treatment. Every day. A Communism must fix that.

So, there’s the obvious. What else needs to done?

Historically, Communisms have failed for a simple reason: States have attempted to enforce this system without the blessing of the governed. A Communist society cannot be created artificially! It has to evolve as a natural byproduct of the will and compassion of the participants, and it has to exist without any governance whatsoever.

In a sustainable Communism, the doctor would not desire wealth, but the people would reward him in other ways out of simple gratitude anyway. He would derive happiness by providing his service, and the people would gain happiness by receiving it and repaying the favor. The bum would be a non-issue: There would be no bums, because everyone would gladly contribute.

Does a person of very low status want to try to become a brilliant engineer? Do the people agree that he shows potential for success? Then he would have the opportunity to try. But what if he fails after all, and the resources needed to train him are expended for nothing? Then he would shrug his shoulders and find another way to repay society, willingly doing a little extra in his final profession to help make up for his previous failures.

Everyone can be provided for. The people just have to want it for themselves.

This is, of course, pie-in-the-sky stuff, and I’ll freely admit that I haven’t thought about all of the details. I kind of just started rattling this off on a whim like fifteen minutes ago (hence the poor structure — sorry), so I’m hoping I’ll get a good handful of comments on this post to force me to flesh this out a bit more. Why do you oppose Communism? Comment away. Please?

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Didja see how the DOW did yesterday? All of the big three indexes dropped into the gutter, actually! How awesome is that?

Yes. Awesome.

Sigh, all right, all right, you want me to be serious. Fine, here’s what I really think: This recession is the best thing to happen to Gen Y professionals ever in their entire lives. Better?

Kids my age know next to nothing about how money works. This is not entirely their fault; schools just don’t teach about it. Regardless, I’ve seen more than a few twenty-somethings get nervous about the economy, whether they know what they mean by “the economy” or not.

Here’s why they all need to relax.

Savings

Your bank is not going to fall into a black hole and take all of your money with it. So maybe your bank was bought out by another bank. Check your balance: the money is still there, right? Even if your bank does go out of business, your money is protected by the FDIC up to $250,000 until the end of next year (at which point it goes down to $100,000, where it was before — the bump is a temporary measure, I’m guessing to increase faith in banks). A bank is still the safest place for your money, safer than a mattress at home, because it offers some protection against inflation. Use the bank.

Jobs

Look, just don’t lose your job. Most people won’t, especially people our age, but if you’re really that worried, I’d say you just have a guilty conscience. Make yourself vital at work. Kiss a few chocolate starfish. Don’t give anyone a reason to fire you. Basic stuff. If you work in an industry that isn’t weathering the recession well, change jobs, or even change careers.

Alternatively, look for ways to make some money off of your hobbies… unless all you do is watch TV all day, in which case, you’re not listening to me anyway. Also, that’s not a hobby.

Side note: If your hobby involves collecting something, find a new hobby. That is a stupid, stupid hobby, especially if you collect something you have to pay for.

Gas

You’ve already gotten used to this months ago. Yeah, I remember paying 90 cents per gallon when I was 17, too. Oh well. Drive less, drive slower, budget accordingly.

Stocks

I guess this is the big one. My 401(k) dipped under $20k last night for the first time in more than a year. A lot of yuppies are probably in similar situations and are getting heartburn over it. Here’s my advice to you: stop checking your 401(k) balance until this is over. You’re not going to be touching that money for another 30 or 40 years. Worry about it when you’re 50 and it’s time to start moving money into bonds.

Have other investments? You’re probably tempted to start selling. A lot of people are doing exactly that, which is just making things worse. Don’t do it. Market fluctuations like this are entirely due to human emotion. When the market starts to fall, people panic and sell. Prices fall even more. This causes smart investors to see cheap stocks up for grabs, which makes prices go back up again, which makes people get giddy and start buying. Prices bubble unsustainably. Eventually, smart investors lose confidence in the bubble and sell, prices take a little dip, people panic, ad infinitum.

The same goes for the economy as a whole. When the economy is good, people start buying stuff like crazy until they run out of money, at which point spending stops and the economy takes a crap. In response, people start saving like crazy, building up huge savings until they have so much money that they can’t bear to not spend it, at which point spending resumes and the economy swells until consumers run out of money again. If people would just moderate themselves and live within their means at all times, this would never happen. Sadly, people are retards.

I’ve derailed.

My point is, don’t sell. Aside from the fact that you’ll just exacerbate the problem, you have to remember something fundamental about stocks: STOCKS ARE NOT MONEY. When your stocks plummet, you have not lost money; your stocks have decreased in value. You do not lose money until you sell your stocks for a price lower than what you paid for them.

What you should really be doing is investing more.

“But Ray! That doesn’t make sense! Stocks are down!”

Yes! I know! They’re cheap! Cheap investments!

“… Oooooohhhhh…”

The fact that people are going to be so scared of stocks for the next few months shows just how little people understand them. There isn’t even that much to understand! Here, I’ll give you an easy, executive summary. More of an abstract, really. I’ll even boldface it. Ladies and gentleman: How to Handle Stocks

Standard practice for nearly all businesses is to shoot for 10% profit per year at all times. Some business do exactly that, some do more, some do less. On average and over the long haul, though, businesses overall make about 10% every year. Because of that, stocks in America, when taken as a whole over a long period of time, average a 10% increase per year.

Boldface off.

It’s an overapproximation, but you get the idea. The key words: “10%,” and “on average”. The one you really want to focus on is “on average”. Some years, the market is going to take a big dive. Point in fact: the DOW is down 36% so far this year. But, that will eventually be pared with four of five years in which it gains 14 or 15% every year. Odds are, it will never gain exactly 10% in any year, but on average, it will.

And that, my fellow prisoners, is why this recession is going to be such a boon to young workers, and why you want to start investing soon. It might take two or three years, but sooner or later, the market is going to correct itself organically, and you want to catch that correction. This recession is going to make a lot of paupers, but it’s also going to make a lot of millionaires. You just have to be smart. Get your credit cards paid off, never carry a balance again, and start saving up. The minimum buy-in for the most of the index funds at Vanguard is $3000. You’re going to want to have that on hand in the next year when people start getting stupid in the other direction.

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Yo! Dude! Check this out! Call my cell! Come on, just do it, it’ll only take a second. Please? Come on. Yeah! You’re gonna love this. There you go. Nope nope, right there. Up one. There. No no, that’s my work number. There you go.

Eh? Eh?

Oh come on! It’s YYZ! You know, that Rush song? The instrumental one? Naaa n-na na naa n-na na na naa n-n-naa n-na na naa n-na na na naaa, you know, that one? It’s on Guitar Hero 2. Aeh, you’re just not into Rush.

Nah, it’s just the cymbal part at the beginning looping. No, not the whole thing. It can only be 30 seconds long. Eh, I think it’d be weird having the whole song play.

Yeah, I made it in Garage Band.

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