Socialism is a sore that never quite heals

David Atherton

August 8, 2022

They say if you are not a socialist at twenty-five you have no heart; if you are not a conservative at thirty, you have no brain. Socialism is a sore that never quite heals and from time to time flares up to exude detritus. It is best treated with facts.

So many woke causes either lean towards socialism or Marxism for some midwit inspiration. Being generous, it is understandable why it has reared its ugly head, considering the 2008 banking crash, the Covid pandemic and the difficulties the young have getting on the property ladder. My answer, though, is that under socialism, you would be far worse off.

Surely what we need to do is run an experiment. We need to compare and contrast two comparable nations, where one lives under socialism, and the other lives under capitalism.

Exhibit A, Korea. Seventy-four years ago, on 9 September 1948, North and South Korea were established. Economically, after seventy-four years of socialism North Korea is impoverished. The GDP per capita is $1,700 a year; in South Korea, it is $30,000, eighteen times wealthier and is a thriving democracy. In 2013 there was a famine so severe the people in North Korea were forced into cannibalism.

During the 1970s Stalinist apologist historians like the late Eric Hobsbawm insisted East Germany was just as rich as Britain. When the Berlin Wall came down in 1989 it was a bare faced lie. West German GDP per capita was over three times that in East Germany. Now, West Germans enjoy only a 50 per cent advantage. Life expectancy was four years longer in West Germany.

China since it went capitalist in the 1980s has seen extraordinary growth rates, typically 10 per cent per annum and is, or will be, the largest economy in the world. Taiwan in 1948 stayed capitalist. In 2021, the GDP per capita of China was $12,361 while in Taiwan it’s $33,775, nearly three times again. Hong Kong today has a GDP of $49,661, four times richer per head.

Hongkongers live the longest in the world, with an average live expectancy of 85.29 years. In Taiwan, it is 81.04 years and in China, 77.47 years. By most metrics people enjoy far greater wealth and life expectancy.

Let us now compare Britain and West Germany in the 1950s. The Clement Attlee Labour government of 1945–1950 nationalised key industries. Coal, electricity, railways, iron and steel were joined by what is now British Airways and the telecommunications industry. In the 1960s and 1970s it took six months to install your phone; in free market America, it took one to two weeks.

Meanwhile in West Germany, economist and statesman Ludwig Erhard oversaw free market, classical-liberal policies. By 1960, the West German economy had overtaken Britain’s. The only sane voice at that time was the Institute of Economic Affairs. Founded in 1955, it pushed for a return to the free market and Britain had to wait until the election of Baroness Thatcher in 1979 to reverse decades of economic decline. Tax receipts in 1979 were £64 billion; when she left office in 1991, £205 billion, reflecting her low tax, free-market wealth creation.

But it seems we are failing to learn from mistakes of the past. Transport Secretary Grant Shapps is re-nationalising the infrastructure via Network Rail. The, at best, social democrat Conservative Party is consuming 50 per cent of Britain’s GDP, we have £2.23 trillion in debt and growing, and rising taxes. When Labour Leader Jeremy Corbyn lost the 2019 election he said, “we won the argument, but I regret we didn’t convert that into a majority for change.” Certainly, it appears he did win the argument.

A shift to the left would inevitably mean a loss of our freedoms too, as well as our prosperity. China is a watchword for oppression and concentration camps. In East Germany, the notorious and brutal STASI saw one in six people state informers. In North Korean public executions have taken place for decades.

More generally, it is capitalism and free trade that have brought billions out of absolute poverty, defined as those living on $2 a day or less. They have no or insufficient access to healthcare, electricity, education or food. In 1985, around 45 per cent of people in the world were living under such conditions, it is now 9 per cent.

In 2013, the United Nations published a report The Rise of the South: Human Progress in a Diverse World. It said:

“Never in history have the living conditions and prospects of so many people changed so dramatically and so fast.”

The only thing we can learn from socialism is compassion, but to be compassionate to the less affluent, we need free and open capitalism, less government, less bureaucracy, and less tax.


  • David Atherton

    David Atherton is Chairman of Freedom2Choose a libertarian lifestyles organisation, journalist and frequent contributor to the BBC, ITV, BBC Radio, TalkTV and GBNews.

Written by David Atherton

David Atherton is Chairman of Freedom2Choose a libertarian lifestyles organisation, journalist and frequent contributor to the BBC, ITV, BBC Radio, TalkTV and GBNews.

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