What Is Socialism?

Since a leading contender for the Democratic presidential nomination has endorsed it, since most of his opponents have refused to denounce it, and since a majority of young people appear to approve of it, now is a good time to ask: what exactly is socialism?

In a free market, you can buy just about any product you can afford so long as you are willing to pay the market price. Since market prices tend to reflect the social cost of production, in order to consume a good, you must pay what it costs society to produce it. On the supply side, people often have many employment opportunities. But wherever you work, the wage you receive will tends to reflect the social value of your contribution to the economy’s output of goods and services.

Under socialism, government rather than the market sets prices and wages. What difference does that make? 

If the government sets the price below the market price, people will buy goods and services that are worth less to them than the social cost of their production. For example, it might cost society $10 to produce a good that is worth only $5 to the person who obtains it. The result will

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