Social Democracy: Why Social Democracy Doesn't Work—Keynesian Economics Part 2
Channel: Libertarian Scot
Date: 2019-10-18

In part 2 on social democracy and why social democracy doesn't work in relation to Keynesian economics I address about the inefficiency relative to the economic calculation problem and the disastrous consequences of thinking demand is something secondary that you need to produce to create. 

Throughout history, relative to the economic calculation problem and the lunacy of believing production drives demand, it results in surplus waste wasting scarce natural resources. As the claims about resource usage it results in neglecting areas of the economy in greater urgency whilst producing aggregate supply in other areas. This explains why mixed economies aren't just so wasteful, but stagnant. As I have explained many times before, you require an economy to be free to drive prices to efficiently allocate resources efficiently that results in better improving the material wealth of the masses, which is why the free market economy works best.

Add to the fact social democracy results in serious inflationary problems through reckless borrowing and spending running the printing press, resulting in an ever growing problem through fractional reserve banking and the strong government regulation over the private sector and you end up with not just a monopolistic corporatist system, but one lacking in opportunity in the marketplace as government tries to take more and more control trying to 'create' jobs that results in the destruction of jobs in the private sector.

Government is not a job creator, it destroys more jobs than what it creates via higher tax rates as mentioned previously. The whole idea of social democracy is predicated around the state and trying to correct so-called problems, but as I mentioned before, the governments intervention only exacerbates the problem.