The Soviet Union's Fall Proves That Economic Protectionism Doesn't Work

I still laugh whenever I listen to the Soviet Anthem sung in English. The whole song bragged about how the Soviet Union would live through the ages which it DIDN'T. The song wanted to brag at how their mighty republic will ever endure. However, history has proven that the Soviet Union didn't last through the ages as intended. Why's that? Socialism doesn't work! 

Here's an excerpt of how socialism is defined in the article "Socialism: The Opiate of the Corrupt and Ignorant":

Socialism has existed in many forms which lie on a continuum, from the central planning nightmare of the USSR, to the Scandinavian democratic experiments of several decades ago. The idea that unites the various embodiments of socialism along that continuum is that economic freedom is counterproductive to the aspirations of humanity. It would be far better and fairer, socialists argue, for the state to distribute scarce resources rather than letting the market allocate goods and services by itself. Socialism seeks control of economic decisions, either through central planning or through expropriative taxation and regulation, in the interest of the common man.

The difference between market-based and socialist economies is not the presence of redistributive policies per se. For over a century, around the world, market-based economies have taxed and redistributed wealth, and provided a host of services such as public education and care for the poor, sick, and elderly. The difference is that in market-based systems taxation is regarded as an unfortunate burden, which is employed out of necessity to ensure that other priorities are achieved. In contrast, in socialist regimes, taxation is not regarded as an undesirable consequence, but as a means to prevent individuals from counterproductively controlling their collective economic destiny.

Socialism’s appeal has always been its false promise to create wealth better than capitalism can. Advocates of socialism promise great economic achievements, which they argue are worth the price of reduced individual economic liberty. It is worth remembering that Karl Marx regarded socialism as an economic necessity that would emerge out of the ashes of capitalism precisely because capitalism would fail to sustain wealth creation. Marx made many specific, and erroneous, predictions about capitalism, including its declining profitability and rising unemployment. His analysis did not consider permanent economic growth in a capitalist system to be a possibility. And his “historical materialist” view of political choice claimed the rich and powerful would never share power voluntarily with their economic lessers, or create social safety nets. Writing in the mid-19th century, Marx fundamentally failed to understand the huge changes in technology, political suffrage, or social safety net policies that were occurring around him.

Not only has socialist theory been wrong about the economic and political fruits of capitalism, it failed to see the problems that arise in socialist governments. Socialism’s record has been pain, not gain, especially for the poor. Socialism produced mass starvation in eastern Europe and China, as it undermined the ability of farmers to grow and market their crops. In less extreme incarnations, such as the UK in the decades after World War II and before Margaret Thatcher, it stunted growth. In most cases, socialism’s monopoly on economic control also fomented corruption by government officials, as was especially apparent in Latin American and African socialist regimes. The adverse economic consequences of socialism led the Scandinavian countries to dial back their versions of socialism in the past decades. If the United States had imitated Scandinavian-style socialism, the CEA study estimates that our GDP today would be 19% lower.

Socialism has been abandoned in virtually all of the developing world. Countries today do not seek to emulate the disasters of North Korea, Cuba, or Venezuela. They also avoid high taxation of the rich. That reflects the recognition that countries compete with each other for capital. Expropriating the rich tends to make them leave, and when they leave they take their wealth with them.

So why did the Soviet Union fall? You can blame it on socialism. It's socialism that allowed corruption in Venezuela to run. The idea of having a monopoly of economic control (such as the oligarchy) has not benefited the people. In contrast, it has restricted job creation because of the idea of supply and demand. The protectionist soviet union's monopoly of the economy in the hands of the elite meant LESS SUPPLY for an entire nation needing jobs. Corruption is but a symptom. The bigger problem of corruption is socialist policies such as economic protectionism and welfare statism. 

So how does capitalism work better than socialism? It's because capitalism encourages competition. Do you know why businesses have not only threats but also opportunities? It's because competition creates more customers and service providers. Inviting foreign investors to do business in one's country is not an act of invasion. In fact, it's all about the principle of give and take of services especially for multinational companies. Either they get 100% ownership or they have the option to have a flexible joint venture with a local partner - a far cry out from the 60/40 policy that Filipino leftists love to embrace. It's also capitalism that gave Communists all the equipment they need to drink their bottles of whine against capitalism!

How did capitalism help Russia in the long run after the fall of the Soviet Union? Here's some facts of how Russia (according to Market Insider) WITHOUT socialism actually did some improvement though there are still problems to address:

• Russia has more than $460 billion in reserve, with a debt level of 29% of the gross domestic product and 15.9 months of import cover.
• Russia's poverty rate has decreased significantly from the immediate post-Soviet rate of nearly 35%.
• Russia after the fall of the Soviet Union had 70 or more billionaires. How's that possible under socialism? Karl Marx would have seized their companies and redistributed the wealth among his cronies. Also, don't hate Ferdinand E. Marcos Sr.'s crony capitalism if you're anti-capitalist!
• The average monthly wage in Russia is USD 670. In Philippine peso - that would cost around an estimate of PHP 36,850.00! This proves that increasing the minimum wage can only be raised in a FREE MARKET.
• Ikea owns 20% of the Russian furniture market. Kick Ikea out and you hurt a good portion of the economy!
• The government was able to afford a USD 50 billion budget for the Winter Olympics in 2014 and still operate. Can socialism do that? 

So still think that economic protectionism will work better and that economic liberalization is the enemy? Also, please don't tell me free trade caused the Soviet Union to be impoverished because it was economic protectionism that did.