76-12-B7
- Main Page \ Reagan Radio Commentaries \ 1977
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Student Letter
TranscriptAre you worried that perhaps our sons and daughters are being led to believe that socialism offers advantage as capitalism can't match. I'll be right back. Economists, at least the good old fashioned kind, have written countless books and essays trying to explain that a free market economy is superior to the collectivism of Karl Marx. There really shouldn't be much of an argument with all the examples we have for comparison. Everywhere there is a socialist nation, there is a failure to meet the needs of the people of that nation, except by calling on capitalist neighbors for help. Still it is the socialist world that is expanding while ours grows smaller. Well how would you like to feel a little better about the whole thing? I received a letter a couple of weeks ago that brightened my whole day. Paul A. Leonard, a sophomore at Mayo High School in Rochester, Minnesota wrote to tell me he had listened to some of these radio broadcasts. Then he wrote, "In view of your support of free enterprise, I thought that you might be interested in an experiment that I recently conducted in my history class." 15 volunteers were selected, with an eye to an approximate balance of athletes, non-athletes, boys and girls. The volunteers were not informed of the purpose of the experiment. The first day, a socialist-like system was set up. The subjects were informed that they had volunteered to do push-ups in return for which they would be given candy." Unquote. Now, push-ups and candy. What do they have to do with socialism? What Paul Leonard explained to the 15 volunteers that they would do push-ups with a limit of 30 on how many anyone would have to do or could be allowed to do. For every five push-ups, they would each get a piece of candy, and here's where the political science comes in. The total number of push-ups accomplished by the volunteers would be divided by 15, the number of volunteers and each would receive a piece of candy for every five push-ups. Those who could do 30 and those who could get off the floor once, would share equally in the candy. Four managed to do the maximum and the overall average was 16.2 push-ups, so everyone received three pieces of candy. That was half the experiment, the socialist half. The next day was capitalism's turn. The volunteers found they were going to do push-ups again, same limit, no more than 30, and same reward, one piece of candy for each five push-ups. Just one difference, they were capitalist this time, no averaging. They would each get one piece of candy for every five push-ups that each one was able to do. In other words, there was an incentive for each one to do his or her very best. The average of 16.2 on the socialist day went up to 21.2, nearly a 1/3 increase in productivity and this time almost half the volunteers, seven not four, did the maximum of thirty. I gathered from Paul Leonard's letter that he really wasn't too surprised about that. If i could deliver a personal message to Paul, sophomore at Mayo High it would be this: Congratulations Paul, you've demonstrated you understand the difference between the magic of the free market system and the idiocy of Karl Marx. There are some pretty eminent PH.Ds in economics who can't figure that out. End of message. This is Ronald Reagan. Thanks for listening. |
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