Strauss-Kahn, Exemplar of Socialism


The libertarian critique of socialism, or “social democracy,” has usually gone something like this:

The socialist program demands a planned economy. A planned economy can result only from plans. Plans must be made by a group of experts who are not subject to the vagaries of the electoral process. To form and implement their plans, the planner-kings must know everything crucial to the economy. They must know everything significant to their own plans, and be able to predict everything significant that may result from them.

But that is impossible.

This being true, the people who become planners will be those who are either stupid enough to believe that Plans can succeed or cynical enough to care only about the personal power that can be acquired by Planning.

The libertarian critique has a logic that no socialist program ever possessed.

Now we witness the reductio ad absurdum of the socialist idea: Dominique Strauss-Kahn, head of the International Monetary Fund, chief honcho of the French Socialist Party, and prospective president of France, who was arrested Saturday on charges of trying to force a maid in his $3,000 a night hotel suite to have sex with him.

Suppose that the charges turn out not to be true. Suppose that Strauss-Kahn’s nickname, “the great seducer,” means nothing. Suppose that consensual sex is nobody’s business but one’s own. Suppose all these things — the last of which is certainly true. The $3,000 a night hotel remains a problem.

As a self-chosen representative of socialism, and an anointed planner of the world's economy, Strauss-Kahn has supposedly devoted his life to the good of the people. How, then, $3,000 a night? On what premise must the people of the world pay for that?

I’ll tell you. The premise is that Strauss-Kahn, a product of those inner-circle French schools whose graduates automatically get high government jobs, deserves his perquisites of office, because he is somehow qualified to plan the world's economy.

Is he?

No. And anyone who thinks that he himself is so qualified, and uses that idea to justify his perquisites of office, is likely to present a strange moral profile.

World economic planning is allegedly justified on humanitarian and charitable grounds. Planners, allegedly, exist to help people, especially the deserving poor. Planners are supposed to be performing an altruistic work, the modern form of a religious mission. Yet among these managers of the world economy there is a strange absence of people who live in modest circumstances, practice some kind of religious or ethical discipline, or have anything to do with normal human beings, except when the maid arrives a few minutes early in their $3,000 a night hotel suite.

There are plenty of smart people in this world. Many modest people, skeptical of their own conclusions because they are actually in touch with their fellow citizens and knowledgeable about their lives, are also smart people. Strangely, many of these smart people are socialists, but their ambition is not to become world socialist leaders.


Because the idea that a small group of people is smart enough and knowledgeable enough to plan the financial lives — in fact, the lives — of six billion people is an idea that no one with any ethical understanding would apply to himself. An ordinary moralist would ask, “Who am I to do that? I don’t know enough. I could never know enough.”

Strauss-Kahn presents little evidence of any such moral or practical reflection. But what he did with his life was predictable, under the modern socialist system. A beneficiary of unmerited advancement, he did his best to “stabilize” the world’s economy by using political means to get the productive countries to support the spendthrift countries. He who wasn't producing anything himself.

I don’t presume that an alcoholic is incapable of becoming a good author. Faulkner did. Hemingway did. And I don’t presume that a “great seducer” is incapable of becoming a great thinker. Plenty of examples argue otherwise. But I do not presume that a drunk will be good at running an airline. I do not presume that a person who lacks discretion even about consensual sex affairs will have enough discretion to plan the future of six billion humble families.

To put this in another way: how did someone as stupid as Dominique Strauss-Kahn become one of the small group of people appointed to oversee the fiscal life of planet earth?

The answer is: the logical necessities of the socialist idea. If you want socialism, you are voting for fools like Dominique Strauss-Kahn. You may not know it, but you are. Otherwise — I’m sorry, you can’t have socialism on any other terms. The fact that Strauss-Kahn rose to the top is only a sign that the rest of the candidates were actually less competent than he.

To conclude: if you want someone running your life, and the life of the world, you can be assured that it will be someone like Dominique Strauss-Kahn — and if not him, then worse.

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Is Europe Liberal?


The EC became the EU in 1992. I lived there at the time, and I wondered if, in socialist Europe, the EU would have a liberal or an illiberal influence. Trade liberalization was an important part of the EC from the beginning, and its successor is still mostly liberal on trade. But then there's everything else, mostly illiberal. And as the EU's powers expand, so does its illiberalism. Although on trade the EU is more liberal than its members, its many new powers are exercised in the interest of the state and its dependents, not in the interest of individual freedoms.

So where does the EU stand on balance? For a long time I wasn't sure. Now I am.

The March 19, 2011 issue of The Economist says that the Euro-zone countries are increasing their bailout of the Euro-basketcase countries, including Ireland and Greece. They lowered the interest rate that they charge to Greece, the country that is most deeply sunk in the basket. But Ireland "received no such concession because it insisted on keeping its low corporate-tax rate." That's right. We are not just a trade union, we are a monetary union; so raise your taxes or suffer the consequences.

On balance, the EU now has an illiberal, anti-libertarian, statist influence on its member states. Taxation and monetary policy are only two examples. There are many more. That little squib in The Economist tipped the scales for me.

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Cuba, While Collapsing


On January 14, President Obama announced that he would issue an executive order loosening US travel restrictions and remittances to Cuba. Though the administration has yet to spell out the details of the change in policy, several areas have been targeted.

Students seeking academic credit and church groups traveling for religious purposes will now be able to visit the island. But it’s the broadening of the definition of “cultural” groups permitted to travel to Cuba that could really open up the island to US tourism — depending on exactly what the new guidelines allow. The indications, according to Arthur Frommer, a travel guide writer, are that these, if not broad indeed, will be fuzzy enough to allow the entire head of the camel to slip into the tent. Additionally, authorized charter flights to the island will be able to depart from any US international airport equipped with proper customs and immigration facilities. Right now, only LAX, Miami, and New York City can offer flights to Cuba.

Predictably, Republicans reacted skeptically — or unfavorably. Hence, Obama’s end-run around Congress. But the reformed Cuban American National Foundation, once the hardest of hardliners, welcomed the proposal, stating that “it’s going to help the interaction between regular Cubans and US citizens; it’s going to help Cuban people inside the island to gain independence from the Cuban government, especially now that roughly a million will be without jobs” — a reference to Raúl Castro’s decision to reduce the government workforce.

Bribery has become endemic. It is, in effect, an institutionalized way of getting things done and maximizing foreign exchange.

Right now, because of currency transaction restrictions, cash is king, which means that US visitors must lard themselves with reams of the green stuff to last their stay — a situation vulnerable to scams and ripoffs. Luckily, Cuban moral standards in the crime-against-US-tourists realm have not depreciated noticeably. But they have snowballed in Cubans’ relations with their own government, an area in which there does seem to be a convoluted method to this madness.

US State Department memoranda, recently leaked by Wikileaks, between Washington DC and the US Interest Section (USINT) in Havana indicate that bribery — high, low, and everywhere — has become endemic. It is, in effect, an institutionalized way of getting things done and maximizing foreign exchange.

The leaks themselves, unlike some Iraqi and Afghan communiqués, are definitely not sensitive. In fact, ever since the profoundly anti-Castro James Cason became our “ambassador” in Havana in 2002, the USINT has — as an official policy position — decided to pour sugar into the Castros’ gas tank. It wouldn’t surprise me if our mission welcomed the leaks. According to the USINT’s website, “The objectives of USINT in Cuba is [sic] to promote a peaceful transition to a democratic system based on respect for rule of law, individual human rights and open economic and communication systems.”

The most recent propaganda war began in the late 1990s, when the Cuban government erected a billboard in front of the mission with a cartoon revolutionary shouting to Uncle Sam, “Señores Imperialistas ! No les tenemos absolutamente ningún miedo!” (Messrs. Imperialists! We have absolutely no fear of you!”) This was followed — during the Elián Gonzales case — by the building of the Jose MartíAnti-Imperialist Plaza just east of the mission, where rallies, protest meetings (particularly targeting US policy), and concerts are held. At first, the USINT pulled its punches by displaying innocuous Christmas figures of Santa Claus, Frosty the Snowman, and a sleigh — censored symbols of a past era. But then, in January 2006, the USINT unleashed the full weight and measure of American creativity. That month, a scrolling electronic billboard in the windows of the top floor of the mission began displaying a quotation by George Burns: “How sad that all the people who would know how to run this country are driving taxis or cutting hair.”

Ever since the profoundly anti-Castro James Cason became our “ambassador” in Havana in 2002, the USINT has — as an official policy position — decided to pour sugar into the Castros’ gas tank.

The Cuban government responded with a huge protest march and the erection of a large number of flagpoles flying black flags with white stars, in a vain attempt to shield the billboard (which brings to mind the old Cuban saying about the fool who tries to deny reality: “You can’t cover the sky with one hand over your eyes”). There was also a Granma International editorial condemning the billboard as “the systematic launching of the crudest insults of our people via the electronic billboard, which, in violation of the most elemental regulations of international law, they think they can maintain with impunity on the façade of that imperial lair.” Apparently, George hit the funny bone again.

Cuban corruption, according to the leaked communiqués, includes bribery, inappropriate “tips,” illegal commissions, influence peddling, graft, embezzlement of state resources, and every other sort of unauthorized expedient used to gain advantage — from the highest levels of the bureaucracy, to ordinary members of the Cuban Communist Party, to the police, the security organs and anti-corruption watchdogs, to professionals of every stripe, right down to the average citizen navigating the reefs of Cuban quotidian life.

Many of the cables refer to illegal commissions either paid to fictitious third parties and deposited in foreign banks or paid openly to the Cuban concessionary and deposited in open accounts. One memo, quoting a Swiss businessman, says, “Like any other place in the world, a million dollar contract assumes $100,000 in the bank [as commission to the Cuban provider].”

If planning to visit Cuba, bring lots of cash — or blue jeans, perfume, soap, spices, sporting and electronic equipment, whatever we usually take for granted in a free society.

A Cuban told the USINT political advisor that “some entire government departments are run as, in effect, mafia fiefdoms. The director of the state bread distribution department placed friends in central hubs and now controls the entire chain of state bakeries.” Along these lines, many of the state jobs most susceptible to skimming, graft, or rent seeking are available only on a commission basis from the functionary in control. As another memo stated, “For example, a position with access to gasoline can cost thousands of dollars because it would permit the beneficiary to traffic in the combustible. Employment in the tourist sector, with access to its tips, can cost hundreds of dollars. A job with Cimex (the import/export bureau) would cost more than $500.” Government departments in charge of transport, construction, health, and food distribution are thoroughly suborned and maintain parallel black markets in lumber, cement, paint, meat, drugs, and many other goods.

Another cable cites the case of a woman who admitted to having her teeth fixed “paying hard currency to a clandestine dental clinic, run by dentists from the Ministry of Health and furnished with equipment stolen from the state.”

Michael Parmly, chief of USINT from 2005 to 2008, writes that the police “are famous for taking bribes. They’re so corrupt that the government replaces the entire force with new recruits from the eastern extremity [rural backwaters] of the island periodically. With time, the rookies become as corrupt as the old hands and they need to be replaced with a new crop.”

A previous Spanish ambassador characterized the situation to the USINT in this way: “Corruption is necessary to survive. When in the majority of Latin American countries a corruption scandal consists of one person stealing $11 million, in Cuba it’s that each one of the 11 million Cubans steals one dollar.” In 2009 the USINT provided this summary to Washington: “Corruption in Cuba is an accepted tool of survival. Cubans average an income of $18 monthly, and the security organs are well aware of it.” Madrid’s El País adds,Nevertheless, conduct considered corrupt in the United States, such as conflicts of interest or influence peddling, is business as usual in Cuba. The authorities tolerate corruption up to a certain point, but for serious corruption they respond with severity.” Makes one wonder how they define “serious.”

Now corruption is not normally part of the libertarian theoretical arsenal. Nonetheless, in this case (and probably in others as well), I will attempt a defense of the practice.

First, it is a relief valve for the constraints placed on normal market activities by unrealistic regulations — especially when they are “regulations without representation.”

Second, “corruption” is more understandable within certain frameworks and traditions. Modern political systems that evolved from Roman tradition — a tradition based less on ideology than on personal loyalty, patronage, and nepotism — are often perceived as corrupt by people nurtured wholly within Enlightenment political tradition. The Roman tax collection system is particularly instructive. Government collected taxes by selling the position of tax collector to the highest bidder. The price was determined by an estimate of the taxes that could be collected. The revenue agent then pocketed whatever he could garner from taxpayers — that was the return on his investment.

The Castro regime attempted to shift the traditional order — extant under Batista and his predecessors, albeit modified considerably over time — to an ideologically-based system. The draconian approach failed. Now, if anything — and in spite of many Cubans’ naïve admiration for the ideals of socialism — ideologically-based standards have suffered a crushing blow. Damage has been done that will be difficult to reverse when the regime collapses.

Bradley K. Martin, in his account of North Korea and the Kim dynasty (Under the Loving Care of the Fatherly Leader), interviewed many defectors from the hermit kingdom. North Korea has a much worse reputation than Cuba. It is surprising, therefore, that the North Korean defectors’ attitudes have much in common with Cuban attitudes. For one thing, reverence and admiration for Kim the Elder is widespread — for fighting the Japanese and imperialism and for socialist idealism, which the defectors are at pains to reconcile with the North’s economic failure, the primary reason for their escape. Similarly, in Cuba much of the populace still admires Castro’s accomplishments and idealism.

“When in the majority of Latin American countries a corruption scandal consists of one person stealing $11 million, in Cuba it’s that each one of the 11 million Cubans steals one dollar.”

In the course of describing how things get done in North Korea, Martin quotes one defector’s eloquent defense of the country’s widespread corruption: “I feel it’s justified. The official works hard to [fulfill the petitioner’s request], so there should be a payoff for him. Above that official there may be higher officials. This lower official has to work hard to [get his own requests fulfilled], has to pay off higher-ups. I just thought that was the way things were. I thought it was understandable. This system is prevalent throughout society. For example, if I couldn’t make it to the factory one day, I’d see the manager and give him some gifts and ask him to look the other way. In North Korea most bribery involves goods, not money. When my father worked as an official at a county economic committee he received so many ‘presents’ from farmers — potatoes, green onions and so on. If a person receives a present in the form of goods, that’s a ‘friendly present’.”

Conchita, a woman I know, understands. The not-so-recent émigré’s extended family and friends keep trickling into the USA, while she keeps visiting people who are still on the island. Those experiences, and her American dream job, conducting publicity for one of the state lotteries, invest her with an extremely pragmatic attitude to government in all its forms. She cultivates contacts in official and unofficial, high and low places. Her advice, if planning to visit Cuba, is to bring lots of cash — or blue jeans, perfume, soap, spices, sporting and electronic equipment, whatever we usually take for granted in a free society — to facilitate every contingency and make a Cuban’s day.

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