In his memoir, "Me & Ralph,” Nader’s former personal editor David Sanford explains: "[T]he next step [for Nader] is to replace them [corporations], break them up into small, decentralized units owned by workers, or better yet by consumers. Supermarkets should be owned by the people who shop in them. Ditto the banks. The people will own the means of production, the sources of financing, and the retail outlets for products.

"If this sounds like communism, it isn't, because there is one very important difference. Socialist governments are bureaucratic and aloof, no more responsive to the needs and desires of the citizenry than is GM. ... By keeping things small, Nader's units will be kept responsive and democratic.”

The Green Party and many other “Naderite” leftists tout similar visions of a utopia.

This plan defies economic logic. One can’t divide the multinational economy into "self-sufficient" localized economies, confined to towns, and expect humanity to simultaneously retain modern technology.

Sanford says that, in Nader's economy, schoolchildren could learn more. And what would they write with, pencils? To have affordable forms of technology, even pencils, you need that which was banished from Nader's economy: corporations.

To manufacture even a pencil, you need a vast division of labor. You need people to obtain the eraser's rubber from South American rainforests, people in another region to mine the graphite for the "lead" writing tip, and other people to coordinate this process.

Individuals perform these specialized tasks in different parts of the globe, under a centralized management.

When hundreds of people freely cooperate to create a common product, they’re in a "team” called a “corporation.”

Moreover, pencils are only as cheap as they are today thanks to economies of scale, which require large concentrations of capital -- such as factories. A factory produces multiple units of a product, thereby reducing its price.

Without centralized corporate management, who’d run these factories? How much could a local factory accomplish with five hundred “democratic” CEOs in complete disagreement?

Thus, to preserve Nader's ideal, we’d have to dispense with modern technology, like pencils and refrigerators, since modern technology needs specialization and centralized concentrations of capital -- all of which necessitate corporations -- to exist.

And, without this technology, our economy would return to what it was before the Industrial Revolution occurred. That would decrease the average lifespan from 77 to 32 years of age.

Furthermore, what about Nader’s demand that everyone own part of every local business? That condition wouldn't last under economic freedom, but only under dictatorship.

If I'm a townsperson who owns a stake in every local business -- from the supermarket to the bakery to the bank -- then I'd have "stock" in all of them. If there are 1,000 townspeople, total, then that means I only own 0.1 percent of all local businesses, which could mean minuscule income.

I'd announce, "If I have a stake in every local business, then I have say in the management of each one. But I don't know how to manage a farm, a fishery, or a bakery, though I do know about running a bank.

"I'll decrease my stake in the three former businesses, and increase my stake in the last. Thus, I’ll sell my shares in the farm, fishery, and bakery, and buy more shares in the bank."

Since many other townspeople would have the same inclination toward concentrating on what each did best, you'd find others willing to re-allocate their holdings from certain businesses to others.

That would lead to a society in which a man could have zero ownership in a store, but many shares in a bank -- possibly more than everyone else combined.

Then ownership of companies would return to uneven distribution, as it was before Nader took over. We’d see the reemergence of corporations owned by a minority.

That's what Nader wanted to change in the first place.

In order to prevent his ideal economy from reverting back into a corporate-dominated one he hates, Nader would have to pass laws forbidding the buying and selling of any company’s stock. Such edicts violate property rights and plant seedlings for greater tyranny down the road.

Let’s hope the Naderites’ unconscionably impractical political system is never forced upon us. We ought to instead push for a freer market -- one complete with large private companies.

Stuart K. Hayashi is the president of the Reason Club of Honolulu and an undergraduate in Entrepreneurial Studies at Hawaii Pacific University, though his opinions do not necessarily reflect that of either institution. He can be reached at radical_individualist@hotmail.com (If you would like to continue seeing Stuart Hayashi's editorials on this site, please let Hawaii Reporter know at info@hawaiireporter.com)

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