for any sort of strong central control, not just “Socialism”, which is a form of monopoly capitalism in which the Government is the monopolist.

What inspired that thought was visiting Mexico again, and once again interacting with Mexican civil aviation. Mexico is a country with a Socialist philosophy at its base, and it has a long list of extremely tight regulations for almost everything. An honest person trying to navigate the maze of regulatory agencies, permissions, forms to fill out, and so on, will never get anywhere, and if the official process was really the way things worked here they wouldn’t even qualify as a Third World country — they’d hardly be a country at all. But if you’re prepared to carry a couple of US$20 bills in your shirt pocket and a roll of hundreds in your pants (are you that happy to see me?…) and grease palms as necessary, getting permission is a piece of cake.

Aviation, of course, is a little different. Airplanes that aren’t maintained properly tend to fall down and go boom!, so not even the richest padron in the system thinks it’s a good idea to bribe the DGAC inspector (Direccion General de Aviacion Civil; sorry about the missing accents, they go on the last vowel of each word) to let it go without proper maintenance. Until recent changes in the US system, Mexico had more and stricter aviation regulations than we did because they simply adopted ours and added more on top — in a country where 90% of the population lives in a few urban areas and with vast stretches of almost-unpopulated desert, you have to file a flight plan for any sort of flight, including gliders, balloons, ultralights, etc. The result is that except for commercial airlines and the boytoys of los ricos, aviation is nearly nonexistent. To the extent it does exist, the aircraft are maintained to US standards or better — if you need work done on an airplane and can afford patience, you can get it done in Guadalajara or Toluca for half price and the work will be as good as anything an American might do.

In the case of development, putting up buildings, and the like, the rich guy sponsoring the work isn’t in danger, so he can freely bribe and coerce the bureaucrats to get permission — or just go ahead and do as he pleases, then bribe and/or coerce for forgiveness afterward. The system is corrupt, and things get built and done. In the case of aviation, el rico is himself at hazard if the requirements aren’t met, so he can’t corrupt the system without direct risk to himself and the system isn’t corrupted. Since it isn’t corrupted, it’s almost impossible to navigate, and only the very rich (or the nearly-insanely motivated) can manage the resources to get through it.

And, at the end, the airplanes are jewelry and the roads and buildings are crap, and a huge fraction of the money that ought to go for development to make things better for the people instead buys Gulfstreams and Learjets for the rich, who fly them off to the US to go shopping with their extended families, and, at the lower level, Armani suits, fancy cars, and big houses with servants for the bureaucrats.

But at least there are roads and buildings and factories, however poorly made they are, and there is a civil and private infrastructure that lets development happen. If everybody was honest and followed the regulations to the letter, none of that would be possible.

The problem isn’t confined to Government, let alone to Socialist Government. If you’ve ever worked for a big company you’ve encountered a somewhat benign version  — Corporate Regulations won’t let you do what you want/need to do, but if you go down and wheedle Doris in Accounting you can get her to convince Fred in Purchasing to get you the stuff. Money rarely changes hands in that version, so we don’t think of it as “corruption” in the same way as we do bribes, etc., but it’s really the same thing, it’s just that the medium of exchange for the bribes is different. That version also works (with a vengeance) within the “honest” bureaucracy of Government.

Any time you find a system that theoretically has strong central control and appears to work, closer examination will find corruption — people exchanging favors and/or resources (including money) to get things done by going around The System. Doing it that way is horrendously inefficient, because system resources, most definitely including the diligence and intelligence of the people in the system, are wasted in evasion maneuvers, and smart unscrupulous people can easily insert themselves into the “black market” and make off with huge chunks of the available resources. It’s why small companies get more done with fewer resource inputs than large ones, and why “…that Government is best that governs least.”

UPDATE: Serendipity — Reynolds links to an American Interest piece on a UN report that corruption costs the world something like one and a half trillion-with-a-trill US dollars a year. Just going by what I see in Mexico, I would reckon that’s about a tenth of what’s spilled on the bar internally in “corruption”.

I have to disagree with “ef”, who says, in the comments to the previous post


Socialism though, only works if the basic instincts/tendencies of humanity are completely turned on their head

Socialism doesn’t work at all. The reason you can sell Socialism to people is that the advertising slogans for it exactly fit the “instincts/tendencies” we evolved during the many millenia we lived as hunter-gatherer-scavengers.