If we cut out welfare and allowed capitalism to take its course, would people's basic needs eventually be fully met by the free market?
The top answers are so bad that they merit a response.I see many communists rehashing the well worn statement along the lines of “NO, businesses only care about profits not people”. Yeah yeah we know. The reality is the following.First things first, all resources in society are limited. Land is limited, food is limited, timber is limited, especially a person’s time is limited. Therefore, as humans we have to decide how we will use all of these limited resources. Considering that there are millions of products we could potentially create out of just a few hundred raw resources, this is very complex. How could we possibly know what and how much of something to produce? Well we have to usePRICES.What are prices in the first place? They are nothing more than signals to society. They tell producers what society wants and how much of it they want. If a business generates an evil profit it is because it is fulfilling the needs of society. If a house building company generates a profit it is because they are supplying a roughly correct amount and quality of shelter to the masses. If it were losing money then that is the way of society to tell the home builder company that they are not using resources efficiently and are not supplying enough or good enough housing to the masses, therefore, they go out of business, or must change their ways so as to satisfy the needs of the masses better. If they do change their ways and organize societies’ limited resources better, then people buy from them more and they are rewarded with profits.Profits are not evil any more than losses are evil. They are simply empirical ways to know if limited resources are being used the way society needs.So on to the welfare question.Without even explaining the immorality of stealing peoples money to give to others, I ask the question, is it even possible for government to ensure the welfare of citizens? Further (and the most important part), how does the state know how much shelter, food, medicine, etc. to give to people if there is no profit or loss system? Think about it, it takes hundreds if not thousands of inputs JUST TO MAKE A PENCIL. Each of those inputs (rubber, wood, graphite, machining, transportation), has their own set of prices (determined by profit and loss) which all is taken into consideration to determine the final price of the pencil. Do you ever notice that we never have a shortage of pencils? For that matter do you ever notice that there is a shortage of bread, or meat, or cars, or electricity? You can thank the free market and the profit-loss system for that.Now on the contrary do you ever wonder why in socialist paradises such as Venezuela, Zimbabwe, the USSR, and Communist China, people are or always were starving and died of basic things like fevers? Do you wonder why around 100 million people died in socialist countries just in the 20th century? All of these countries had universal welfare, what happened? Simply, without any profit and loss system as inherent in capitalism, they had no possible way of knowing what and how much of things to produce. The result? Mass starvation. Even though these before mentioned countries are incredibly rich in natural resources and farmland.Now many will say, “yeah but we aren’t proposing full socialism we just want the government to provide basic stuff, you know mixed economy and all that”. this doesn’t make the basic economics go away. The government doesn’t rely on the profit loss system, they rely on a system of coercion and taxation. this means that they don’t have a profit or a loss, they just have huge budgets and abstract “goals”. Efficiency and consumer demand doesn’t even fit into the calculation and therefore the “welfare” they provide will always be progressively more expensive and lesser quality. Don’t just take my word for itThe sadly funny thing is that poverty steadily declined in the “horrible” capitalist days of the 19th and early 20th centuries, whereas, with the introduction of the modern welfare state in the U.S. the poverty rate has stagnated in spite of the enormous and ever increasing budget we throw at the so called “war on poverty”. Why? Again, because economic calculation for the state is impossible and therefore they can never know what, how, or how much of something to produce, in this case, welfare.Contrast this to capitalism which decades ago eliminated the kind of grinding poverty that plagued mankind for centuries (at least in the west where it has most thoroughly been implemented), and continues to lift humankind up to more elevated standards of living today. Just remember that if you enjoy having an abundance of food, shelter, clothing, etc. it is thanks to the profit-loss system that enables companies to empirically know how much you need of something. Paradoxically, however, the more government “welfare” we have the more we will need.If you want to read more in depth about the subject go to Emerging| All Things Liberty and Art