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Socialism Is Back
From the January 24, 2010, issue of NR


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Kevin D. Williamson
What is a public good? Economists distinguish between public and non-public goods on two grounds, features known as rivalry and excludability. Public goods, under the economic definition, are goods which are non-rivalrous in their consumption and non-excludable in their distribution. A couple of examples will make these distinctions clear. A rivalrous good is one for which my consumption of one unit of the good leaves one unit less for your consumption. A mango is rivalrous in consumption: Every mango I eat is a mango you cannot eat. But some goods are non-rivalrous: a highway, for instance. If I drive down a mile of highway, that does not leave one less mile for you to drive down.
But not all non-rivalrous goods are public goods. That hypothetical highway could be a private turnpike. That’s where the second criterion, excludability, comes in. Excludable goods are those for which we can limit consumption to paying parties. Those mangos are excludable goods; if you don’t pay me, you can’t have any of my mangos. But some goods are non-excludable: for instance, a big fireworks display. You could sell tickets to a fireworks display, but people on the periphery would still be able to see the show. Public goods are those goods which are both non-rivalrous and non-excludable.
 
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There are obvious examples of government action, such as national defense and law enforcement, that provide classical public goods. But there also are less obvious examples, and it bears keeping in mind that useful public goods will vary from place to place. For instance, in New Delhi, there is a terrible problem with mosquitoes. Each year, hundreds of people die of dengue fever, and many others are sickened by mosquito-borne diseases. So the local authorities conduct mosquito-spraying campaigns at public expense. Mosquito control is non-rivalrous (a mosquito that is dead to you also is dead to me) and non-excludable (you cannot arrange it so that mosquitoes refrain from attacking only paying parties) and therefore meets the definition of a public good. But a public good is not synonymous with “something that is good for the public at large.” Mosquito spraying in a place with no mosquito problem would be a “public good” that is a waste of resources. Likewise, one might argue that there are significant public benefits from things like public schooling, government-subsidized health-care programs, and Amtrak, but those things, whether we enjoy them or not, whether we desire them or not, do not meet the technical definition of a public good.
 
Every government undertaking engaged in the public provision of non-public goods is an instance of socialism, at least at a trivial level. But most socialism of that sort probably is better described as “welfare-statism.” As a practical matter, all modern governments engage in some public provision of non-public goods. That does not mean that every government is, in a meaningful sense, socialist, or that it would make sense to describe every government that maintains a public school or a public highway as socialist. There are questions of degree, and questions of judgment, and the answers to those questions will vary from case to case.

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So what distinguishes a garden-variety welfare state from a system that well and truly deserves to be identified as socialist? Beyond the public provision of non-public goods, a second factor — economic central planning — is crucial to identifying and understanding what differentiates real socialism from the normal mishmash of welfare-state policies typically found in Western liberal democracies and affiliated forms of government.

 


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