 What is socialism? Economics studies human action. Using economics, we can understand how social systems create different results based on how they allocate resources. With a market economy, production is guided by enterprises seeking profit and innovation. With cronyism, government influences market outcomes with intervention. A command economy rejects markets entirely in favor of central planning. This is socialism. After socialism, central planners control what is made, who makes it and who benefits. While markets reward those who best serve customers, socialists promise that everyone's needs are taken care of equally. Instead of individuals choosing what goods and services they prefer to spend their money on, they are provided only with what goods and services the central planners have chosen for them. Some people may reject the central plan. The result is that socialist countries tend to be politically authoritarian. The economic consequences of central planning are just as bad. For example, profits reward and encourage innovation and efficiency. If you are the first to create a new product or find a cheaper way to provide a service, the individual who risks capital is financially rewarded. Under socialism, there is no incentive to innovate because the rewards go back to the planners. Central planners also operate based only on their own knowledge, which is always less than the collective knowledge of society. Think of the difference between a published encyclopedia, which is static and quickly becomes dated, and a decentralized alternative, like Wikipedia, which is constantly evolving and growing. Markets also create a unique piece of knowledge. Prices. Since many resources, such as steel, have a variety of different end-uses, prices signal whether the use of a specific resource satisfies the top priority of the community should a factory produce hammers or nails. In a market economy, prices indicate when there is a greater need for one product over another. In a command economy, government blindly makes that decision. Without economic calculation enabled by prices, a complex economy becomes impossible. The socialist goal of redistribution of wealth makes the basic mistake of not understanding how wealth is created. An economic system that does not reward innovation, saving, and production will see the quality of life for everyone decline. Often, politicians today will not go so far as to call for the socialization of every part of the economy, only for certain sectors like healthcare, roads, and education. While a mixed economy of markets and socialist services can function better than a purely socialist economy, there are problems that still exist. For example, a truly socialist healthcare system forces decisions about the use of scarce resources, like hospital beds, machines, and medicines, to be decided not by individuals, families, or doctors, but by government planners. While patients of socialist healthcare may not have to pay to visit the doctor, they may face other critical obstacles like long wait times, medicine shortages, and rationing of care, all resulting in a lack of medical freedom. Economics explains why freedom makes society richer and more prosperous. The case for socialism is not grounded in economics, but an appeal to equality. The result is to make people equally poor.