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Politics : Libertarian Discussion Forum

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From: TimF	8/30/2022 2:56:25 PM
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Cost Disease Socialism Definition Philosophical Zombie Hunter Aug 29 Short definition: cost disease socialism is when government policy restrict supply and diffuse the cost of demand for labour-intensive parts of the economy, causing prices to rise dramatically. Longer definition: cost disease socialism happens in a few parts Restrict supply by subsidising suppliers and heavily regulating them. Choosing who the winners are, pressuring losers to leave the industry and setting high costs for new entrants. Typically, the types of industries will be labour-intensive. Through this government intervention, wages might rise, but wages can be higher in these sectors due to the overall economy being more productive and competition for labour. The government will increase demand, by diffusing costs to the general population (or offer cheap loans), so as to take the industries out of needing to compete on market prices. Through this government intervention, there will be a reduced need to innovate and increase productivity as regular market forces do not effect them as much. This means that scaling services in these industries and reducing costs would not happen as much. At some point, these interventions cost spiral more and more and the government starts paying them through deficit spending. The increases in these areas tend to increase inflation and become a substantial cost to the middle class and the poor - who will then ask the government to intervene to reduce their cost of living. Both the left and the right keep this spiral going, because it is politically convenient for them to use populist reasons to blame for the higher prices. For the left, it is the rich capitalists. For the right it is immigrants who use these services and increase their costs. More info: americanaffairsjournal.org discoursemagazine.com -- philosophicalzombiehunter.substack.com

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