Leftism Brings Economic Catastrophe

FrontPageMag | Dr. Mark W. Hendrickson | Jun. 10, 2008

A recent International Monetary Fund research report listed the countries expected to suffer the worst currency depreciation—that is, the worst inflation—this year. Zimbabwe (a mind-boggling 300,000 percent-plus), Venezuela (25.7 percent), Bolivia (15.1 percent), Nicaragua (13.8 percent), and Argentina (9.2 percent) are the top five. What do these countries have in common? You could reply in two ways: 1) they are poorly governed; 2) they are leftist governments, which is simply another way of saying that they are poorly governed.

Indeed, it is difficult to think of any economic indicator that exceeds inflation as evidence that a country is poorly governed. Leftist governments—defined here as regimes unfriendly to private property, private enterprise, and private profits; regimes that constantly seek ways to redistribute wealth from the economically productive members of society to favored political constituencies; and regimes that reject free markets and instead expand government control over economic activity—invariably cripple production while increasing government spending. The inevitable result is inflation.

This is no mere academic discussion. It was less than 30 years ago that inflation in the United States was in the 13-14 percent range. Today, resurgent inflation in the United States is officially listed as 4 percent, but for many Americans, it feels much worse. Is it possible that we might break into the IMF’s list of the top-five inflation-plagued countries in the next year or two? To answer that, we should ask ourselves if we have sound governance or poor governance. Sadly, examples of the latter seem to be proliferating. The following are some examples:

In just eight years, U.S. federal spending has ballooned from $2 trillion to $3 trillion—a 50 percent increase at a time when the average private income increased only 28 percent.

At 35 percent, the United States now has the second-highest corporate profits tax in the world—absolute insanity in a time of intense global competition when Congress should be doing everything in its power to help domestic employers compete against foreign companies.

At a time when formerly communist countries in central and eastern Europe have adopted flat-rate personal income taxes less than 20 percent, and are booming as a result, the United States clings to an outdated Marxian, growth-retarding, class-warfare, graduated income tax, and at least one presidential candidate [Obama] wants to raise those rates even more.

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