The Protestant Ethic and the Spirit of Socialism

I was talking to one of my graduate students on Friday about the European economic crisis and the inevitable collapse of socialism. He had an interesting reaction: “Well, of course, a welfare state in Greece, or Italy, or Spain is a really bad idea. But Germany is doing fine. Economists don’t appreciate the importance of culture. There’s nothing intrinsically wrong with the welfare state; it just requires a culture of hard work and orientation toward the future.”

That prompts the thought: Maybe socialism can work in the right set of cultural circumstances. Maybe, if the people do work hard; have children; save and invest for the future; and take advantage of the benefits of the welfare state only when they truly need to, a socialist economy can succeed. I’ve argued before that the welfare state is a pyramid scheme and is therefore ultimately unsustainable. But population growth could provide the exponential growth in the base that a pyramid scheme needs.

Is socialism sustainable, given an appropriate culture? For a while, surely. But how does one sustain that culture? How long can Germany remain Germany under a socialist system of economic organization? The empirical evidence from all across Europe is that socialism undermines the desire to work hard, have children, and save and invest for the future. In 1960, Europeans worked just as many hours as Americans; now they work far fewer. That represents a significant cultural shift. The welfare state, I think, is responsible for much of it.

Max Weber saw the Protestant Ethic as underlying the growth of capitalism. The growth of capitalism may underlie the growth of the welfare state, as prosperous people believe that they can afford to help those in need. Needs expand into wants, and the welfare state undermines both prosperity and the culture that made it possible.

8 thoughts on “The Protestant Ethic and the Spirit of Socialism

  1. I think that socialism works within families, somewhat poorly in communities, and really falls off as the size of the population increases.
    In other words: people don’t scale.

  2. Yes, the hard workers of northern Europe have masked the ill effects of the welfare state for some time. On paper places like Germany and Sweden have it all together, right? Yet if you talk to people from those places you hear things like, “Hamburg doesn’t even look German anymore” or “My [Swedish] niece and her husband work outside of Sweden, like most young Swedish adults, because the taxes are so high in Sweden. They’ll go back later.” Then of course there are the news stories about Malmø and the banlieus of Paris that are “no go” zones for police and first responders. As you say, the perverse incentives of the welfare state and, I would add, secularization, have contributed to a crisis in civilizational morale (G. Weigel’s term) that is reflected in the demographics and the immigration policies.

  3. Smitty, I agree, though even within families it can cause problems if one person consistently mooches off others.

    Barb, you’re absolutely right. Northern Europe is in real trouble too, as massive immigration from Muslim nations changes the culture dramatically. That points up two critical points I didn’t mention: secularization and immigration. The welfare state puts the government in charge of what had been a function of the church and other voluntary associations, giving them little to do. (That’s one reason why leftist religion makes little sense to me; left-wing Christians seem to me to campaign for their own irrelevance.) So, socialism leads to secularization, which undermines the future-orientation that economic growth and the welfare state itself badly needs. Socialism also leads to liberal immigration policies, to provide new marks for the Ponzi scheme. But rapid immigration from other parts of the world (it won’t do any net good, after all, to shift workers from one socialist country to another) tends to undermine the cultural values on which the welfare state relies.

  4. I hadn’t thought of leftist religion in those terms exactly, but close. With respect to Leftist Christians, they appear to want to enact the beatitudes by way of government policy, while simultaneously outsourcing their personal responsibility for the Kingdom to nameless, faceless bureaucrats, obliterating the transcendent message of Christ . This is dehumanizing to all involved, and a has created a spiritual holocaust in Europe.

  5. I should mention that I hated George Bush’s “Faith-Based Initiatives” for this reason. Really extremely misguided.

  6. The experiment has been run: how long did East Germany remain hard-working and productive under Socialism?

  7. Gee-whiz. There’s some jaw-dropping irony here. Let’s consider;
    . “Then of course there are the news stories about Malmø and the banlieus of Paris that are “no go” zones for police and first responders”.
    – Indeed. Lucky there’s nowhere like that in south central LA or in London or western Sydney..
    . “Northern Europe is in real trouble too, as massive immigration from Muslim nations changes the culture dramatically.
    – Last time I looked, the culture of southern California was being dramatically altered by mass immigration from Mexico. I think the US is in real trouble, frankly. Isn’t this – at least partly – because big business and the rich want cheaper labor? The idea that socialism is inextricably linked to mass immigration is completely false. Cuba has virtually no immigration. Try getting into China or Venezuela to live. Which brings us to;
    . “Socialism also leads to liberal immigration policies,”
    – No. A relatively high standard of living drives mass immigration. It does this in two ways, which can be described as push and pull.
    Push – higher standards of living attract poorer people from developing countries to want to emigrate to those with better standards of living. This is why the so-called ‘socialist’ nations of northern Europe are so attractive to the poor of northern Africa and the middle east. And why the US is so attractive to central Americans.
    Pull – at their particular stage of economic development, wealthier countries usually have some level of organized labor pushing improved wages and conditions for workers. For this reason, capital will look to move as much of it’s operations to cheap labour countries as possible. That’s why much of the West has been de-industrialized over the past 40 years. But sometimes it’s not possible to outsource jobs to third world countries. You can’t get your hair cut in China. You can’t get your pool cleaned in Thailand (unless you move there yourself, along with your pool). So, the wealthy in Western countries support mass immigration as a way of keeping wages and conditions as low as possible, right at home.
    . “The experiment has been run: how long did East Germany remain hard-working and productive under Socialism?”
    – The fact that it had been totalled by the Red Army at the end of World War Two, and then missed out on the masses of financial aid pumped into west Germany by the Allies in a cold war frenzy furing the late 40’s and early 50’s was irrelevant, I’m sure. But on the other hand, if you look at Sweden and Denmark you can see that since the 70’s they have consistently outperformed the US and the UK in terms of standard of living. As we sit here today, which country is more ‘hard-working and productive’; the US or communist China? Look at GDP growth and productivity growth for your answer.
    . “This is dehumanizing to all involved, and a has created a spiritual holocaust in Europe.”
    – A spiritual holocaust, you say!! Where? In my travels, I’ve found some of the MOST religious and spiritual people I’ve ever met in eastern Europe and Russia. The LEAST spiritual or religious – in my view – are in the richer countries of the middle east and in the US / UK. This leads me to think that spirituality – in general – goes hand in hand with a lack of material wealth. Where material wealth is available and consumer goods rampantly advertised, materialism replaces religion as a cultural component.
    To get back to the theme of the blog, I think the kinds of economic systems that work are those that empower people. Beaurecratic forms of socialism don’t do this, but neither do the extreme forms of neo-liberal internationalist capitalism practiced in most non-European western countries today.

  8. I made no claim that socialism is the *only* system that tends toward liberal immigration policies; I asserted that its redistribution schemes require a growing number of workers to support them. That number might grow through a higher-than-replacement birth rate, through immigration, or through some combination of the two. Socialism undermines birth rates, for it imposes such heavy taxation that people can’t afford to have children, and it so drastically limits growth that there is little realistic prospect that children will have a life as good as that of their parents. So, keeping the redistribution going requires immigration.

    The alternative, which Cuba illustrates, is poverty. China has largely abandoned socialism, at least in the rapidly growing areas.

    The standard of living in Scandinavia, by the way, is significantly lower than in the United States. Incomes are high, but the cost of living is astronomical.

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