Economic principles made simple

I’ve heard and probably posted this story several times before (and it may originate with Arthur Brooks), but I liked the five points tacked on at the end so much, I’m sharing the whole thing with you once again:

An economics professor at a local college made a statement that he had never failed a single student before, but had recently failed an entire class. That class had insisted that socialism worked and that no one would be poor and no one would be rich, a great equalizer.

The professor then said, “OK, we will have an experiment in this class on socialism”.. All grades will be averaged and everyone will receive the same grade so no one will fail and no one will receive an A…. (substituting grades for dollars – something closer to home and more readily understood by all).

After the first test, the grades were averaged and everyone got a B. The students who studied ‘hard’ were upset and the students who studied ‘little’ were happy. As the second test rolled around, the students who studied little had studied ‘even less’ and the ones who studied hard decided they wanted a free ride too so they studied ‘little’.

The second test average was a ‘D’. No one was happy.

When the 3rd test rolled around, the average was an F.

As the tests proceeded, the scores never increased as bickering, blame and name-calling all resulted in hard feelings and no one would study for the benefit of anyone else.

To their great surprise, ALL FAILED and the professor told them that “socialism” would also ultimately ‘fail’ because when the reward is great, the effort to succeed is great, but when government takes all the reward away, no one will try or want to succeed.

Could not be any simpler than that.

Remember, there IS a test coming up. ” elections sometime soon – perhaps the sooner the better”

Your chance to have YOUR say.

These are possibly the 5 best sentences you’ll ever read and all applicable to this experiment:

1. You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.

2. What one person receives without working for, another person must work for without receiving.

3. The government cannot give to anybody anything that the government does not first take from somebody else.

4. You cannot multiply wealth by dividing it!

5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

Can you think of a reason for not sharing this? Neither could I.

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  • http://OgBlog.net Earl

     
    Clearly a racist post.

  • MacG

    You cannot multiply wealth by dividing it!”

    (Sorry for the red) 

    Unless you are a cell that is dividing by natural means creating another versus a scalpel that cuts it in two.  One lives, the other dies.

    Romney ought to be describing Obama’s policies as ‘lowest common denominator” policies which can only by nature bring things down.  The result is that everybody (the have lesses) appears to be better off and as we know to the Hollywood politicians and illusionists, appearances are everything. 

  • MacG

    It was red in the composition window :/

  • http://bobagard.blogspot.com Bob Agard
  • http://bookwormroom.com Bookworm

    Thank you very much, Bob.  I appreciate that.