Thursday, February 02, 2012
This fable doesn't represent a strong critique of socialism because it neglects the fact that the people executing it need the support of the people below to remain in power. No professor would dare try this in real life because he would be sued and the students would probably go on homework strike.
Basically I could concoct an equivalent tale of how monarchy doesn't work by saying some professor took all his students' lunches by divine right and they starved to death. Doesn't prove anything.
I agree with the philosophy regarding the evils of socialism, however, I was suspicious about the story. No places, names, dates. One of the commenters at Fausties cites a Snopes post on the subject: http://www.snopes.com/college/exam/socialism.asp
Clearly, the next step for the class is to begin appropriating the grades of classes next door still operating on the reward system. After those grades are exhausted, and no classes are left to conquer, the only option is to execute any students capable of doing better but choosing not to do so.
Hayek has a better explanation for why socialism is doomed to fail:
1) Socialism requires central control.
2) Central control is suboptimal because it has an overwhelming information problem. Big companies can have the same problem, which is why seemingly well-run companies like IBM and Xerox originated ideas that other little companies expolited.
3) Central control requires coercion, which is also suboptimal