Two Crises of Socialism

The transformation-inducing crisis of 1989-91 in the so-called "Eastern Bloc", brought about by the non-existence of private property rights in factors of production, bureaucratic fixing of prices and wages, and the general subjection of the Soviet-controlled economies to the political goals of the ruling parties rather than the freely determined economic goals of millions of individual consumers and producers, is rightly and almost universally regarded as a crisis of socialism.

The currently ongoing financial crisis, brought about by bureaucratic manipulation of the money supply and interest rates by the monetary politburos known as central banks, securitization of mortgage-backed "junk assets" by government-sponsored enterprises instituted to fulfill the welfare-statist dream of "universal homeownership", economically groundless rating practices of the state-created rating agency cartel, implicit governmental bailout guarantees for the banking sector, and an unprecedented, flagrantly unsustainable accumulation of public debt, is, despite the wishful thinking of socialists of all stripes, the aptly called second crisis of socialism.

Thus, if one is in the mood for pointing fingers of blame, one should choose one's targets carefully and informedly, lest one end up looking very foolish.