From the Fraser Institute

By Matthew D. Mitchell and Steven Globerman

New York City mayoral candidate Zohran Mamdani, a member of the Democratic Socialists of America, proposes socializing the city’s grocery stores. If you think this is some trailblazing experiment, think again.

In September 1989, Boris Yeltsin, then a member of the Supreme Soviet, toured a Houston grocery store. He was stunned by the variety of fresh fruits, vegetables and meats. The cornucopia of low-cost healthy options surpassed anything in the special stores he and other party elite frequented. Yeltsin knew it was nothing that ordinary Soviet citizens, long barred from the elite stores, had ever seen.

His biographer reports that afterward, Yeltsin sat motionless, head buried in his hands. Back in Moscow, he declared, “I think we have committed a crime against our people by making their standard of living so incomparably lower than that of the Americans.”

Two years later, Yeltsin became the first freely elected leader of Russia. A few months after that, Mamdani was born. Like so many socialists before him, he must earnestly believe that the government can meet the needs of citizens better than the private sector. On this, he is wrong.

Everywhere socialism—government-run economic activity—has been tried, it’s failed to meet the people’s needs. We recently helped profile these failed experiments in a series of books on the realities of socialism published by the Fraser Institute. Socialist economies are terribly wasteful. Socialist Poland used three times as much steel as the United States for every dollar of output it produced. And it produced very little—in 1985, the typical Pole managed to make just 27 per cent as much as the typical American, as measured by GDP per person.

Although socialist industries produced little of value, they ravaged their environments with water, soil and air pollution far in excess of those in capitalist economies. A 1991 Washington Post article said of Warsaw’s tap water: “It spurts yellowish-brown from the tap, laced with heavy metals, coal mine salts and organic carcinogens. It stains the sink, tastes soapy and smells like a wet sock that has been fished out of a heavily chlorinated swimming pool.”

Socialists also wasted human resources. Poles worked 18 times as long as capitalist West Germans to buy one kilogram of coffee, 13 times as long for a TV, 11 times as long for a bottle of wine, and nine times as long for a car. During the 1980s, 7 per cent of Poles had telephones, and 11 per cent owned cars. The typical Pole waited 15 to 30 years to get a house.

When anthropologist Sigrid Rausing visited Estonia in 1991, she found TVs that wouldn’t work, cars that wouldn’t start, phone lines that dropped calls, and dilapidated buildings everywhere. Locals told her to avoid tap water, but when she drank a bottle of sparkling water, she swallowed bits of crumbling glass.

Planners poured millions into military and space programs but missed what any functioning market would have told them. Croatian journalist Slavenka Drakulić explained to a Western audience that “I have just come from Bulgaria, and believe me, women there don’t have either napkins or Tampaxes—they never had them, in fact. Nor do women in Poland, or Czechoslovakia, much less in the Soviet Union or Romania. This I hold as one of the proofs of why communism failed, because in the 70 years of its existence, it couldn’t fulfil the basic needs of half of the population.”

Modern socialists like to say we’ve yet to see “true” or “pure” socialism. The “purer” the actual experiments, the worse things were. Vladimir Lenin’s early attempt at “pure communism” was, in the words of economist Jack Hirshleifer, “the most extreme effort in modern times to do away with the system of private property and voluntary exchange.”

It was a disaster. Total economic output declined by 70 per cent in eight years. Historian William Chamberlin called it “one of the greatest and most overwhelming failures in history.” When Lenin backed off, incomes began to inch back up.

After the Soviet Union’s 1991 collapse, some Eastern Bloc countries embraced freedom quicker than others. Those such as Poland and Estonia, which permitted citizens to start and run businesses, to acquire and use property and to exchange with others on mutually agreeable terms, fared much better than those that went slower. The Polish standard of living is now quickly closing in on that of the United Kingdom. Estonians are not only leaders in economic freedom, but also in personal freedom.

If Mamdani is serious about helping New Yorkers, he should make New York more like the Estonia of 2025 than the Soviet Union of the 1980s.

Matthew D. Mitchell

Senior Fellow in the Centre for Human Freedom, Fraser Institute

Steven Globerman

Senior Fellow and Addington Chair in Measurement, Fraser Institute