Submitted by Steven Rogers, Nov 24, 2007 00:00

This is an important correction to the "history" we were all taught as children - one of the many direct and indirect ways that children are taught to think of communal living and unlimited "sharing" as the ideal. But when Mr. Stossel says: "When people can get the same return with a small amount of effort as with a large amount, most people will make little effort," he's missing the economic role of profit and price, and feeding the Leftist notion that socialism is a noble ideal that people aren't noble enough to implement - that socialism *could* work, if people just tried harder and weren't so selfish. Remember that these colonies were founded before most modern economics was developed, so the colonists had little to go on beyond their own intuition based on custom and religion. So for them, it wasn't an expression of capitalism versus socialism, but rather just figuring out how to survive. But even so, there's a powerful lesson to be learned from it. The problem with socialism isn't merely motivation. If it were, surely eating rats to avoid starvation would have motivated the settlers to work harder. The problem with socialism is that it destroys the ability of each person to live by his own judgement, which makes production impossible. Profit, price, and capital allow people to live by their own judgement - it's how one decides what to do, and has the means to do it. Socialism denies the role of the mind in production (remember the labor theory of value). In this view, choices are obvious - people in a commune, or in a planning bureau "just know" what to do. But we can see that even on the smallest scale, this isn't true. Not even the prospect of death by starvation can tell people what needs to be done. Bradford, writing before the time of modern economics, would have to have been an economic genius to fully realize what he was seeing and report on it in economic terms - to go beyond mere motivation to see the role of price and capital in the settlement. But nearly 400 years later, we can see the events in a broader economic context. This is a crucial issue to grasp, because so long as the idea persists that socialism is noble, people will keep trying to implement it. But is isn't noble to dole out the unearned - it isn't even possible.

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