In his classic 1841 book on financial bubbles,
Extraordinary Popular Delusions and the Madness of Crowds, Charles Mackay observed, “Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.”
Mackay covered religious and political delusions, too. “We see one nation suddenly seized, from its highest to its lowest members, with a fierce desire of military glory; another as suddenly becoming crazed upon a religious scruple," he recounts, "and neither of them recovering its senses until it has shed rivers of blood and sowed a harvest of groans and tears, to be reaped by its posterity.”
Venezuela is sowing its harvest of “groans and tears." Due to the breakdown of civil society in the country,
even war-plagued Syrians feel more safe in their homes than do Venezuelans. Venezuelans are so hungry that
they cried at the sight of food in Columbia. Recently the hungry broke into a zoo
to kill a horse for its meat. Literally, they have become serfs that may be
required to work 60 days or more in agricultural fields.
Venezuela has the
world's worst rate of economic growth, and the worst inflation rate. It has become like
"a gangster state that doesn't know how to do anything other than sell drugs and steal money for itself."
Socialism has virtually destroyed civilization in Venezuela making it seem like a "hurricane [has] swept things away."
When the history of this tragic period in Venezuela is written, the population will have plenty of “culprits” to blame. In blaming many will eschew their own responsibility. Some will blame Chavez; others will blame Maduro. Some will follow their beloved leaders and continue to blame the "elite" and the capitalists. The true believers will continue to insist there is no inherent flaw in socialism; they will simply say mistakes were made that will not be made again.
We are not the victims of the world we see. Our delusions, our beliefs have consequences. The fact that our delusions are often invisible to us does not make them any less powerful or any less consequential. Again, Mackay observed that a population subject to delusions “only recover their senses slowly, and one by one.”
Venezuelans have not yet recovered their “senses.” Caracas radio host Glen Martinez
stubbornly insists that the “reforms” that Chavez instituted will never be reversed. “We are not the same people we were before 1999,” Martinez said. Many share Martinez's sentiments; daily the
true believers still march and promise to spill their blood in support of the government.
There is no better book than Friedrich Hayek’s classic
The Road to Serfdom to explain the popular delusions that helped to virtually eliminate the market economy and civil society in Venezuela. Writing during the depths of World War II, Hayek intended his book as a warning “to the socialists of all parties.” What happened in Venezuela can happen wherever a critical mass of the population begins to hold certain delusionary beliefs.
Popular Delusion 1: Freedom Means Freedom from Necessity
Hayek points out that
freedom in Western countries traditionally meant “freedom from coercion, freedom from the arbitrary power of other men.”
Socialists point to a “new freedom” which is “freedom from necessity” which releases us “from the compulsion of the circumstances which inevitably limit the range of choice of all of us.”
Hayek adds, “the demand for the new freedom was thus only another name for the old demand for an equal distribution of wealth.”
Believing that these two types of freedom can be combined is delusional. Hayek points out that the new idea of freedom “gave the socialists another word in common with the liberals and they exploited it to the full....Few people noticed [that the word freedom was being used differently] and still fewer asked themselves whether the two kinds of freedom promised really could be combined.”
Popular Delusion 2. Only Coercive Planning Can Coordinate Activity
Almost every individual and organization plans. Writes Hayek, there is no “dispute about whether we ought to employ foresight and systematic thinking and planning our common affairs.”
Hayek thought that to plan or not to plan is not “the real question.” Instead, we should ask if “the holder of coercive power should confine himself in general to creating conditions under which the knowledge and initiative of individuals is given the best scope so that they can plan most successfully; or whether a rational utilization of our resources requires central direction and organization of all our activities according to some consciously constructed ‘blueprint.’”
The humanitarian disaster in Venezuela has been a long time in the making.
In 2010, the hungry waited while "2,340 shipping containers with more than 120,000 tons of rotting food (estimated to feed 17 million people for one month)" sat at the government run port of Puerto Cabello.
Believing that the “coercive or arbitrary intervention of authority,” can coordinate and adjust our individual activities is delusional. With this delusion comes disbelief that a market economy can solve problems and advance society. Those who cherish such delusions may find themselves hungry.
Popular Delusion 3: Economic Choice is Not Necessary
Hayek enumerates the warning signs that a society is on the road to socialism. On the road to socialism, people blame “the system” for their troubles and “wish to be relieved of the bitter choice which hard facts often impose upon them.” They “are only too ready to believe that the choice is not really necessary, that it is imposed upon them merely by the particular economic system under which we live.”
Chavez was a master blamer; for many years, the population found their own hatreds nourished by his. Capitalism was a frequent target of
Chavez’s lies: “[Capitalism is] an infernal machine that produces every minute an impressive amount of poor, 26 million poor in 10 years are 2.6 million per year of new poor, this is the road, well, the road to hell."
Like other tyrants, Chavez didn't neglect the old, reliable villain of the Jewish people. He railed, “The descendants of those who crucified Christ... have taken ownership of the riches of the world, a minority has taken ownership of the gold of the world, the silver, the minerals, water, the good lands, petrol, well, the riches, and they have concentrated the riches in a small number of hands.”
In blaming "the system," Hayek observes that even well-meaning people ask, “If it be necessary to achieve important ends," why shouldn't the system "be run by decent people for the good of the community as a whole?”
As Jeffrey Tucker has observed,
“socialists are scarcity deniers.” Socialists exploit the fact that, in Hayek’s words, “we all find it difficult to bear to see things left undone which everybody must admit are both desirable and possible." In societies turning to socialism, there is no appreciation of scarcity. There is no appreciation that “things cannot all be done at the same time, that anyone of them can be achieved only at the sacrifice of others.”
Thus, there is support for coercive planning, because individuals “feel confident that they will be able to instill into the directors of such a society their sense of the value of the particular objective.” In other words, there is the delusion that planners will follow their wishes and they will receive more of the goods that they want, sparing them from the necessity of making a choice. Why choose between spending your own savings on housing or education if you've been assured that you are entitled to both at society’s expense?
It is delusional to assume that the role of an effective political leader is to control the uncontrollable. To believe that scarcity can be eliminated and hard choices averted is delusional.
Popular Delusion 4: There is a “Common Purpose”
It is essential to understand why there can be no such thing as the “common purpose.” All coercive plans will be win-lose, benefiting some and harming others. Hayek explains, “The welfare and happiness of millions cannot be measured on a single scale of less or more. The welfare of the people, like the happiness of a man, depends upon a great many things that can be provided in an infinite variety of combinations.”
The hard to give up delusion of socialists is that there are coercive plans that will benefit all. Venezuelans have seen the means of production nationalized in the name of the common good and with every intervention their standard of living fell further.
Nothing can be done for its own sake in a totalitarian state. “Every activity must derive its justification from a conscious social purpose” determined by the totalitarian rulers. “There must be no spontaneous, unguided activity, because it might produce results which cannot be foreseen and for which the plan does not provide. It might produce something new, undreamt of in the philosophy of the planner.”
Popular Delusion 5: The Ends Justify the Means
Those who would coerce believe they know what is best for you. If a few eggs have to be broken, that’s a small price to pay for the socialist omelet. Hayek warns that the idea of "the ends justify the means" leads to amoral totalitarianism: “There is literally nothing which the consistent collectivist must not be prepared to do if it serves ‘the good of the whole’ because ‘the good of the whole’ is to him the only criterion of what ought to be done.”
Since there is no majority to agree on a specific plan of action to promote a nonexistent “common good,” the worst get on top in a centrally planned economy.
The “worst” will take advantage of the fact that agreement can be more readily forged by focusing on a “negative program.” This negative program revolves around stirring up primitive hatred contrasting “us and “them.” If Venezuelans were not susceptible to the stirring of delusional passions, Chavez and Maduro would’ve been unsuccessful in obtaining “the unreserved allegiance of huge masses.”
The “masses” that the “worst” seek to mobilize will include those who themselves are not grounded on principles. Hayek cautions that those having “imperfectly formed ideas are easily swayed;” their “passions and emotions are readily aroused.”
The End of the Road
“To make a totalitarian system function efficiently,” Hayek observed, “it is not enough that everybody should be forced to work for the same ends. It is essential that the people should come to regard them as their own ends.”
The end game is a population that doesn’t realize it is on the road to literal serfdom. Hayek writes: “If the feeling of oppression in totalitarian countries is in general much less acute than most people in liberal countries imagine, this is because the totalitarian governments succeed to a high degree in making people think as they want them to.”
This is why a totalitarian state seeks to eliminate private schools and socialize education.
In 2012 the Chavez government implemented
"Resolución 058." “The resolution states that all decisions in every school — public or private — must involve parents, teachers, students, workers, and the community” in order to "construct a new model of socialist society." This model includes the belief that the State is the source of well-being.
Venezuelans will have to recover from their delusions “one by one.” A point in time will come that, due to their suffering, a critical mass of Venezuelans will no longer think as the government wants them to think. In the meantime, let us remember that Hayek wrote
The Road to Serfdom to warn that the descent into socialism can happen anywhere. Let us have empathy for the suffering of the Venezuelans; and as Hayek would have hoped, let us also watch and learn.
Barry Brownstein is professor emeritus of economics and leadership at the University of Baltimore. He is the author of The Inner-Work of Leadership. He delivers leadership workshops to organizations and blogs at BarryBrownstein.com, and Giving up Control.
A couple of years ago, I shared 
President Donald Trump has promised to make a “big decision” in the next two weeks on the Paris climate accord after promising to “cancel” the agreement during the campaign last year.
Fundamentally, the Paris Agreement is a costly and ineffective approach to addressing global warming. There are compelling economic, environmental, and legal reasons for Trump to make good on his campaign promise, and the commonly heard arguments for remaining in the agreement do not pass muster.
The Paris Agreement, signed by more than 170 countries, aims to limit global warming to 2 degrees Celsius above pre-industrial levels.
The means of accomplishing this goal largely center on reducing carbon dioxide emissions by transitioning the global energy economy away from affordable, dependable conventional sources of energy.
Countries involved in the agreement each submitted nationally determined contributions, setting their respective obligations for keeping temperatures in check.
As a member nation, the U.S. also submitted its goals under the Obama administration. The domestic regulations listed by the Obama administration aimed to reduce greenhouse gas levels across the entire economy by 26 to 28 percent below 2005 levels by the year 2025.
The U.S. regulations alone would increase energy costs for U.S. families and businesses, causing an overall average shortfall of nearly 400,000 jobs and total income loss of more than $20,000 for a family of four by the year 2035.
Compliance with the Paris Agreement will cost the global economy trillions of dollars over the next 80 years. Yet the results will be almost zero reduction in projected warming, even if every country met their respective carbon dioxide reduction targets as promised under the agreement.
Even former Secretary of State John Kerry made some revealing claimsregarding the ineffectiveness of Paris:
The emissions targets are not legally binding, and Trump has already issued executive orders calling on his agencies to unwind some of the domestic regulations that are part of the U.S. national domestic contribution.
Some of those who recognize the failings of the Paris agreement and the significant costs of the regulations nonetheless argue that it is better to remain in the agreement and have a seat at the table, since there are no repercussions for failing to meet the targets.
They believe that withdrawal could have damaging diplomatic ramifications and cede leadership to other countries.
But even if Trump eliminates all of the domestic regulations, there are still significant costs for remaining in Paris. Chief among those costs are legal risks, a ceding of leadership to other countries, and various forms of cronyism.
Legal Risks
Remaining in the Paris Agreement while failing to the Obama administration’s pledges would give environmental activists new arguments in their inevitable legal challenges to Trump’s domestic energy agenda.
As Heritage Foundation legal scholar Alden Abbott recently explained, even if environmental activists’ challenges fail in court (as they should):
Ceding Leadership
Withdrawing from the Paris Agreement will be met with consternation from foreign leaders, but that certainly doesn’t make it a bad decision.
The reality is that the United States is, and will remain, a global superpower. Withdrawal from Paris will not change that. In fact, it will fortify it by demonstrating that the U.S. is willing and able to resist diplomatic pressure in order to protect American interests.
The only way to truly protect American interests is to withdrawal from the agreement altogether.
Withdrawing will also prevent future administrations from using the existing U.N. framework to avoid getting the Senate’s advice and consent in the treaty process, which is what President Barack Obama did in the Paris Agreement.
Furthermore, history has shown that refusal to join international climate commitments in the past did not cripple relationships with foreign countries.
For instance, despite strong pressure from the U.N. and European governments, President George W. Bush did not ratify or implement the Kyoto Protocol, in which 37 industrialized countries committed to legally binding cuts in greenhouse gas emissions.
Although criticism was loud, the Bush administration was able to overcome it and successfully work with other governments on numerous international issues of mutual concern. The same will hold true for the Trump administration.
Catering to Special Interests and Big Business
The media is spinning a narrative that Paris is different from past international climate negotiations because businesses and investors support international action on global warming—even industries like big oil and big coal.
But it is nothing new for big business to support policies that, at first glance, seem to be against their business interests.
Just as industry has thrown its support behind cap-and-trade legislation or a carbon tax, special interests within industry will inevitably help craft a policy in which their bottom line is protected—or at least hurt less than their competitors.
For instance, the American Enterprise Institute’s Tim Carney writes,
Furthermore, there is a giant pot of taxpayer money available from the Green Climate Fund for the taking.
Negotiating a deal that may protect certain industries with subsidies and carve outs will only continue to leave American taxpayers and energy consumers exposed to harmful international climate policies.
The bottom line is that this international framework for addressing global warming is a costly and ineffective approach, and the alleged diplomatic costs of leaving the Paris Agreement—and the benefits of staying—have been far exaggerated.
Trump should now make good on his promise and withdraw.
Commentary by Nicolas Loris and Brett Schaefer. Originally published at The Daily Signal. The Daily Signal depends on the support of readers like you. Donate now