For decades, socialism was a dirty word. But after 20 years in the wilderness, it seems to be making a comeback with support coming from the most unlikely of places, where the prevailing thinking seems to be that taxpayers, rather than risk-takers, should foot the bill for mistakes of the past.

It's not a totally foreign concept for Australia where, for generations, the unofficial slogan of the Country Party (later the National Party) was: ''Capitalise your profits and socialise your losses.''

It might have been a joke. But clearly it is an enduring one, where the last laugh is destined to be had at the expense of taxpayers.

In the past few weeks, European authorities have gone at each other hammer and tong, arguing about whether or not the banks that lent exorbitant amounts of money to wayward nations such as Greece should be required to take any losses at all for their reckless lending practices.

In Australia, meanwhile, we have the ludicrous situation where both sides of the political spectrum agree they want to cut carbon emissions by the same amount which, in saner times, would have them working towards a common solution.

But in an extraordinary twist, the conservative opposition is railing against a plan by a federal Labor government to make polluters pay for carbon emissions via a free-market based pricing solution.

Instead, the opposition is proposing taxpayers directly fund all the costs to fix the problem via a big government-style direct intervention into the market, the kind of proposal that would have traditional Liberals such as Bob Menzies screaming from the grave.

Once considered a panacea to the world's social problems, socialism became a derogatory term conservative politicians could sling at their leftie opponents, often with devastating consequences.

At least, that was the case in the two decades after the 1980s when deregulation, open markets and competition became the mantra for a new world economic order.

There is a compelling logic to free market economics. Take the risk, reap the rewards. Pretty simple, really. And its application through the 20 years up until 2007 delivered incredible lifts in living standards in the developed world and in emerging regions such as south-east Asia.

If you've ever studied economics, the theory goes that a free market - a system where supply and demand determine prices - is the most efficient way to allocate scarce resources.

Up until 2007, free-market devotees routinely denounced the intrusion of government into the market system. Any intervention, it was argued, detracted from the efficiency of an open pricing system.

But when the world of finance turned on its head in 2008, when all the rules of capitalism and free markets seemed to be exposed as a farce - not because the theory was wrong but because it had been poorly applied - the greatest proponents of deregulation and free markets began squealing for government support.

Mind you, that was only a temporary change of heart. Bankers around the world wanted to be propped up by taxpayers. Washington bailed out Wall Street and then Wall Street investment banks made a motza out of selling government securities to fund the bailouts.

The idea that banks now can never be allowed to fail, and that investors in those institutions should be forever protected from loss, has become the accepted norm.

Ever since the chaos that followed the Lehman Brothers collapse, when American authorities allowed the floundering operation to sink, central bankers and regulatory authorities universally have decided that no major bank ever will be allowed to crash.

Since the latest debt crisis outbreak in Europe grabbed the headlines - before the potential default of America overtook it - European leaders again have begun stress-testing banks to ensure they could survive a worst-case scenario.

The unspoken message again was that banks must be protected. Admittedly there have been some discussions on how to make banks and their investors share a small part of the pain. But that was about the extent of it. There were no hard resolutions, merely suggestions, with a nod towards further talks.

You can understand the motives. No one wants a return to the chaotic events that ensued during 2008 and 2009.

But it would appear banks now have been placed into an entirely different category to the rest of the capitalist system. And that begs the question: if bank shareholders are no longer prepared to take the risks, should they be entitled to the rewards?

During the dark days of 2008 and 2009, we watched governments globally, including our own, offer taxpayer-guaranteed loans at discounted rates.

Most of that money raised offshore was lent to us, the taxpayers, although more innovative organisations such as Macquarie Group decided they could earn bigger profits if they spread the love a little, opting to distribute the loans around the globe.

Does that constitute socialism? Absolutely, although it is more along the lines of the National Party definition of offloading your dud hay during the rainy period at sunny-time prices.

Here we are as taxpayers, delivering guarantees to financial institutions so they can borrow money offshore, bring it back here and lend it to us at a profit. Now that's a terrific deal.

What a parallel to the great Australian carbon tax debate which has descended into a mire of misinformation and outright lies.

Julia and Tony are on the same page as far as carbon emissions go. They both want them reduced because, according to their official policy statements, both believe in human-induced climate change.

But while the rest of the developed world has accepted that a market price for carbon is the most efficient way to alter the behaviour of polluters, Australian voters have become sceptical, partly because of the avalanche of ill-informed rhetoric from ideologues with political axes to grind.

Putting a price on carbon - as Europe has done - allows business leaders to make their own choices, to take their own risks, thereby reducing the heavy hand of government and minimising the risk of bureaucratic bungling. It is the sort of policy you would expect from a conservative, free market-based political party.

Instead, harking back to the era of big government and direct intervention, the Coalition is proposing to spend $10 billion of taxpayers' funds to provide incentives to business to reduce their emissions and invest in new technology.

That means taxpayer funds will be handed out to foreign companies so they can build new power stations and sell the power back to us at a profit. A terrific deal if you own a dirty coal-fired power station.

A carbon tax on polluters, or doling out taxpayer funds? That's the choice.

But while the rest of the developed world has accepted that a market price for carbon is the most efficient way to alter the behaviour of polluters

Socialism: path to wealth

bobbythefap1 wrote on Mar 5^th, 2012 at 5:45pm:



Fine by me. I have never been better off.

Then again, you're the same guy who says Jews deserved the holocaust and you hope they get it again.

So do you really have a shred of credibility?