In a Socialist state where wages are determined by need, a family of four has a greater need than a family of three. Therefore, in the name of fairness, the man and woman with two children will receive a higher wage for the same work as the man and woman who has only one child. If we assume the four working adults in this scenario have similar abilities, a portion of the second couple’s labors will be directed towards paying for the first couple’s extra child. The assumption that makes this work is that the second couple will not resent this and will continue to produce as though they were receiving the compensation themselves. If their “production” falls below the first couple’s, in other words, if they produce only what they think is commiserate with their pay, the system fails. It relies entirely on those with ability and less need being willing to produce at maximum effort for those with greater need. What it really boils down to is the destruction of the family and family relationships. In order for this system to work I have to love your children (or the State as a whole) more than my own. I must be willing to forego improvement in my family’s standard of living to ensure your family reaches the same level.
In a society such as this, personal wants and ambitions are sacrificed for the common good. One cannot earn more pay by working harder. That would not be fair to those with lesser abilities or lesser ambition, therefore there is no incentive to work beyond the quota set by the Government. In a sense there is still competition in this economy. People do not compete to excel or produce or gain wealth. They compete to show the greatest need. They compete for scarce resources. In this system the People as a whole is not an asset to the Government. It is a liability and those that can produce, must produce, to make up for those who do not. If the People become too much of a liability they may even do what China has done: enforce abortions on those women who already have enough children, as determined by the State.
If a man works much harder than his peers and produces more goods or services, he has identified himself as having exceptional ability, therefore, his quotas will be raised accordingly, but his pay will remain the same. It has to stay the same in order to ensure equality. A young worker typically makes this mistake once.
This whole concept runs so counter to human nature one has to wonder, “So just how do they make it work?” Making it work poorly is simple; making it work well is impossible. You make it work down the barrel of a gun, or in a re-education camp or gulag. The one commonality of all Communist-Socialist countries was force. Socialism, unlike Capitalism, must be enforced. Political dissidents are jailed or killed outright (ie. USSR, China, North Korea, Cuba, Viet Nam).The only freedom left to the People is their freedom to produce less, to work less, to feign ignorance or inability. Even here, one walks the fine line between minimal expected performance and treason against the People’s State. If a man is not rewarded for work, it is natural he will do less work. The Soviet worker strived to keep his quotas low and meet the minimum requirements. After all, he was not working for his own benefit, but for the benefit of the State. It was only natural he would wish to do as little as possible. There are two words which describe things that work for no reward, no benefit and no self-interests. The words are “machine” and “animal.” Which do you want to be?