Cooking the Books 2: How to undermine socialism

In the “Dear Economist“ column of the Financial Times Magazine (4/5 August) a correspondent asked:

“I suffer ridicule from economist friends when visiting a local restaurant. The restaurant supplies complimentary tissues and toothpicks to customers. My friends freely use them and even take some for later use. I feel this is wasteful and not ‘playing the game’ but their arguments seem more logical – there’s no extra cost to taking more, it is included in the costing for the meal, and I’m the mug subsidising everyone else. How can I overcome my hang-up and become a maximising consumer?”

In his somewhat tongue-in-cheek reply Economist wrote:

“You have already realised that your friends are correct. Perhaps more persuasive than the pure logic is the knowledge that by grabbing tissues and toothpicks, they are holding back the forces of communism. I dimly recall – but have not been able to confirm – that Lenin held up free condiments as an example of the way goods could be free and yet not rationed. It is up to right-thinking people to prove him wrong by walking off with the entire stock. By grabbing toothpicks, your friends are chipping away not only at bits of salad but at the ideological foundations of communism. They deserve your support.”

Very funny. But there is a serious point here. In socialism, where not just condiments but nearly all available goods and services will be there for people to take and use freely, if people did try to behave as the “maximising consumers” in the economics textbooks then socialism (or communism, the same thing) would collapse. People would not necessarily take more than they needed, but they would make the “rational choice” for them as individuals of not working to help produce things but leave this to the “mugs” who didn’t exploit the fact that they could get something for nothing. In other words, they would be free-loaders.

But this just shows how wrong is the theory that people do (and should) behave as “maximising consumers”, only taking into account their own perceived short-term narrow self-interest. People don’t behave in this way even under capitalism and no society, not even capitalism, could survive if they did, precisely because it wouldn’t be a “society”, but simply a mass of competing, back-stabbing individuals.

Human beings are social animals. All our social attitudes and behaviours are derived, in one way or another, from the society we were born into, brought up in and live in. Certainly, as individuals we want to live the best life we can, and, certainly, we are capable of making rational choices and, at the individual level, do so most of the time. But would free-loading be a rational choice in a society of free access?

Those who had just established a socialist society must be assumed to have done so because they wanted to live in such a society and to have understood that it could not survive on the basis simply of “to each according to needs” without its counterpart of “from each according to ability”. In these circumstances to choose not to contribute to producing what was needed would be an irrational choice. Not that all work would be the “pain” that bourgeois economics assumes it must be, the “cost” we must pay for the “pleasure” of consumption. That’s another myth propagated in economics textbooks.

Even “games theory”, which starts from the typically capitalist assumption of a group of isolated self-seeking individuals, ends up concluding that “reciprocal altruism” – do as you would be done by or, more vulgarly, you scratch my back and I’ll scratch yours – would be “the rational choice”.

The FT’s witty economist is right on one thing: the “maximising consumer” would have no place in socialism.