Socialism: This article explains socialism in a practical way. After reading it you will understand the basics of this political movement and view on society and the economy.
What is socialism?
Socialism is a political, social and economic philosophy or vision. Socialism falls on the left side of the political spectrum and encompasses a set of economic and social systems characterized by social or shared ownership. This mainly concerns the ownership of means of production and control over these means. More on this later.
There are many definitions of socialism. Not one of them encompasses the many kinds of socialism, but a commonality between all forms is the element of common property to a greater or lesser extent.
Types of socialist systems vary based on the extent and role of economic markets and the planning and allocation of means of production, management structures and the role of government in society.
An example is Marxism, which sees the world as a materialistic place that is in constant motion along with societies and nature. Other socialists emphasize the organic unity of those elements. In practice, a purely socialist society does not exist in the west. Conversely, it does not happen that a society and economy are purely capitalist.
Socialism vs Capitalism
Today’s Western societies in the world are predominantly capitalist. That means that many means of production are privately owned, with exceptions. Companies are owned by the shareholders and those shareholders are generally private individuals. Governments own only a few companies or means of production.
According to socialism, everything that people produce is a social product and everyone in society is entitled to a share in it. Society as a whole should therefore own everything that is produced, not just a small group of wealthy shareholders.
But it’s not just about ownership. Society should also have control over these means of production. This means that only society decides what should be done with these means of production.
Origin of socialism
The left-wing ideas of socialism are related to communism. At their core, both schools are against capitalism, but modern currents of socialism coexist well with today’s Western societies.
This means that virtually no modern society and economy is purely capitalist, and the same is true of socialism and communism. Only North Korea can be said to be almost entirely communist-run.
Socialism predates the well-known Communist Manifesto of 1848, by Karl Marx and Friedrich Engels.
These two revolutionary political figures are the figureheads of expressing the concern for social problems arising from a purely capitalist system.
The term socialism has its origins in the Latin ‘sociare’, which means to combine or share. The more technical term used in the Roman Empire was ‘societas’. This roughly means community, or a consensual contract between free people.
Current Socialist Societies
The emergence of the Soviet Union as a socialist state led to a general association of socialism with the economic model of the Soviet Union.
However, economists and intellectuals argue that the Soviet Union model was more similar to a capitalist form of government, or an unplanned economy.
In the years since, a clear distinction has been made between authoritarian socialist states and democratic socialist states. Authoritarian socialist states are, for example, the aforementioned Eastern Bloc and North Korea.
Democratic socialist states are countries that are democratically governed by socialist parties in the West. However, many of these Western countries abandoned socialism after the Cold War and replaced it with an advanced capitalist system.
Types of Socialism
Some forms of socialism have already been mentioned briefly. The most common forms of socialism are explained in short below.
In a democratic socialist system, the government is democratically elected and the means of production are controlled by that government. All important services and goods, such as energy, infrastructure, housing, care and other vital elements are implemented in a planned manner.
The free market system is used for the distribution of consumer goods.
Revolutionary socialism is the most far-reaching form of socialism. The gist of it is that no socialist system can be established while capitalism is still in play. Revolutionaries believe the road to true socialism requires a lot of struggle.
In a revolutionary socialist system, all means of production are owned by workers through a well-developed and centralized structure.
Liberal socialists assume that people are self-determining, autonomous and rational. Once capitalism is taken away, it is believed, people will automatically switch to a socialist system. The reason for this would be that a social system is quite capable of meeting all needs.
In market socialism, the production process and the means of production are under the control of the working class. The common worker decides how resources are divided and distributed. Workers sell that which is in excess or give it to certain members of society. They then distribute it on the basis of a free market system.
Green socialism is about protecting natural resources. Large companies in a green socialist society are owned by the public. Green socialism fosters and promotes the use of public transport, as well as the production and sale of locally grown food.
The production process aims to give every member of society sufficient access to goods to meet basic need. Everyone receives a sustainable wage.
Mutual criticism and contention
There are many points of contention between socialists and capitalists. Socialists view capitalism as unfair and unsustainable. Lower classes would not be adequately supported and greedy owners would systematically exploit workers by paying lower wages.
Proponents of capitalism argue that it is impossible to manage a socialist economy and to allocate scarce resources efficiently without market forces. The result is a shortage of everything, or just surpluses and corrupt politicians. All this would actually lead to more poverty. Socialism would be impractical and inefficient.
A first challenge in socialism is that no one wants to perform dangerous or inconvenient jobs without a higher pay. Socialist planners cannot encourage these people to do that work without violating pay equality.
The biggest challenge, however, is market forces. Or better, the lack of market forces. Without market forces, no economic calculations can be made. Without accurate calculations, no actual accounting can take place and capital cannot be deployed efficiently over time.
Benefits of Socialism
Socialism prevents exploitation and promotes equality
A socialist, social and economic system must prevent workers from being exploited. That was also one of the motivations for Karl Marx and Friedrich Engels to write and publish the communist manifesto. They called on the proletariat to unite and revolt against the upper class with the legendary phrase: “Workers from all countries, unite!”
Prevention of exploitation is guaranteed in this system because workers in the community have a say in how resources are managed. Each employee contributes in a way that fits his or her capabilities. Regardless of that contribution, everyone has access to basic goods. This minimizes poverty in a society. Moreover, everyone has equal access to care and education.
Socialism rejects discrimination
The socialist system rejects discrimination in all forms. Everyone does what he or she is good at and gets the most pleasure out of. If there are things that no one wants to do, a higher fee can be set aside for them.
Disadvantages of socialism
Dependence on collaboration
The biggest drawback of a purely socialist system is the reliance on partnerships to get things done. In addition, people who are competitive are not valued, but rather despised. Competitive individuals would tend to create social unrest for personal benefit.
Lack of competition and innovation
The lack of competition means that innovation is not strongly encouraged. A socialist system does not reward enterprising people who dare to take risks, which reduces the attractiveness of innovating.
Now it’s your turn
What do you think? Do you recognize the explanation about socialism? Do you consider yourself a socialist? What do you think are the advantages and disadvantages of a socialist society? Do you think socialism can coexist with capitalism? What tips or comments can you share with us?
Share your experience and knowledge in the comments box below.
- Marx, K., & Engels, F. (2012). The communist manifesto. In The communist manifesto. Yale University Press.
- Von Mises, L. (1981). Socialism. Ludwig von Mises Institute.
- Roemer, J. E. (1994). A future for socialism. Politics & Society, 22(4), 451-478. Roemer, J. E. (1994). A future for socialism. Politics & Society, 22(4), 451-478.
- Verdery, K. (1996). What was socialism, and what comes next?. In What Was Socialism, and What Comes Next?. Princeton University Press
- Schumpeter, J. A. (1950). The march into socialism. The American Economic Review, 40(2), 446-456.
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Published on: 06/16/2022 | Last update: 06/16/2022
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