Wealth and Want
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Robin Hood
Mason Gaffney: Oil and Gas Leasing: a Study in Pseudo-Socialism
"Socialism," in common usage, is a Protean word, slippery and shifting. Many use it without defining it, whether from innocence, negligence, or cunning. These many include not just the vulgar, but most economists: semantic care is weak in the traditions of the profession. "Rigorous" model-builders today are among the offenders: the premium is on gilding the superstructure, neglecting the foundation. Indeed, foundations are not even needed for models that float in outer space, vouching for and communing mainly with each other.

Those who do define Socialism, explicitly or implicitly, use the word for different things. A major difference, treated here, is between Managerial Socialism (who decides) and Distributive Socialism (who gets). These may overlap, but are independent of each other and often conflict. For example, Riverside, CA, owns its own electric utility (on whose Board I sit, losing battles). This is Managerial Socialism, municipal style. Its traditional rate structure includes large elements of cross-subsidy, mainly taking from the lower middles for the rich, tempered by crumbs thrown to the very poor. The same is true of our water system, and of most municipally owned and managed utilities around the nation. Water and sewer service are common examples of Managerial Socialism (from which the mnemonic "sewer socialism"). They have little in common with Distributive Socialism.

At higher levels of government, also, Managerial Socialism may play reverse Robin Hood. In British Columbia the "Socred" (right-wing) party in the 1960s socialized the ferry service, the provincial railroad, and the electric utility (now B.C. Hydro), using them in schemes to enrich land speculators. To boost along B.C. Hydro they raided the teachers' pension fund, borrowing from it at rates near zero. The New Democratic Party (NDP) (left-wing), taking power in 1972, ended the raid on teachers, but not the cross-subsidy. In California, the State Department of Water Resources (DWR) designed, built, and operates the California Water Plan (CWP) for the primary gain of a handful of giant landowners. They, too, raided education, taking certain State oil revenues (known as the COPHE fund) previously earmarked for The University of California. Such examples could, of course, be extended at length. ...

Interjurisdictional transfers are not properly "Socialism," but a reshuffling of rents among landowners. These transfers are called "horizontal balancing" in the lingo of fiscal federalism. They are a long step removed from the social dividend paid to individuals as such. They are properly decried for "taxing poor people in rich places to help rich people in poor places." These "poor places" include developmental regions and local districts, poor today but prospectively rich, where landholdings are large and speculative. Horizontal balancing devices thus fall in a class of artful dodges, seductions, and diversions leading from Distributive Socialism to Pseudo-Socialism. ... Read the whole article

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Wealth and Want
... because democracy alone hasn't yet led to a society in which all can prosper