Moneybox

Elon Musk Is Trying to Redefine Socialism as … Capitalism

WESTWOOD, CA - APRIL 05:  Elon Musk attends the premiere and Q&A for 'Do You Trust This Computer?' at The Regency Village Theatre on April 5, 2018 in Westwood, California.  (Photo by Alberto E. Rodriguez/Getty Images)
Imagine words had no meaning. It’s easy if you try.
Alberto E. Rodriguez/Getty Images

For reasons that are not entirely clear to me, Elon Musk decided to troll some socialists on Friday.

He kept trolling over the weekend.

There are, of course, much more important issues in the world right now than a billionaire’s Twitter taunts. Children are being torn from their parents at the border, and the Trump administration is gearing up to strip more naturalized Americans of their citizenship based on technicalities. Elon Musk’s dime-store political philosophizing at the expense of rose Twitter is not that important, even if he is an influential, powerful guy.

But I do want to take a moment to unpack this troll just a bit, because it is kind of amazing. While socialism is a somewhat fuzzy term these days, it’s generally understood to mean a political system where the government engages in a good deal of wealth redistribution. When Musk says, “True socialism seeks the greatest good for all” and that he does not support a redistribution of wealth to the “least productive,” it sounds a lot like he’s talking about Pareto efficiency, a theoretical state where absolutely nobody can get richer without somebody else becoming poorer. In a Pareto equilibrium, you could have a society that’s collectively as well-off as possible—that’s Musk’s “greatest good for all” line—even if the majority might be a lot better off with a bit of redistribution.

For a long while, economists tended to view Pareto efficiency as the end-all-be-all of policy design. This wasn’t entirely bad, since it tended to focus researchers on ideas that might lift all boats, or at least lift some without sinking others. But it also partly explained the profession’s free-market leanings, since, in theory at least, letting capitalism do its thing is a good way of maximizing total resources on paper, if not creating a just or livable society. Socialists, meanwhile, tend to care less about Pareto optimality and think more about how resources are distributed among people. Of course, I’m simplifying a bit here. Plenty of left-leaning but mainstream economists also care about distribution these days. Plenty of DSA members think we could potentially be a richer country overall with a different economic system. And, to get technical about it, there are Pareto-optimal models that allow for some redistribution. But historically, whether you cared about maxing out society’s wealth or making sure it was fairly divided has been a fundamental split between laissez-faire types and socialists. In other words, Musk more or less seems to be redefining socialism as capitalism. Way to flip the script Elon!