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Socialism refers to a broad array of doctrines or political movements that envisage a socio-economic system in which property and the distribution of wealth are subject to control by the community for the purposes of increasing social and economic equality and cooperation. This control may be either direct - exercised through popular collectives such as workers' councils - or indirect - exercised on behalf of the people by the state. As an economic system, socialism is often characterized by state or community ownership of the means of production.
The modern socialist movement had its origin largely in the working class movement of the late-19th century. In this period, the term "socialism" was first used in connection with European social critics who criticized capitalism and private property. For Karl Marx, who helped establish and define the modern socialist movement, socialism implied the abolition of money, markets, capital, and labor as a commodity.
A diverse array of doctrines and movements have been referred to as "socialist." Since the 19th century, socialists have not agreed on a common doctrine or program. The various adherents of socialist movements are split into differing and sometimes opposing branches, particularly between reformist socialists and communists.
Since the 19th century, socialists have differed in their vision of socialism as a system of economic organization. Some socialists have championed the complete nationalization of the means of production, while social democrats have proposed selective nationalization of key industries within the framework of mixed economies. Some Marxists, including those inspired by the Soviet model of economic development, have advocated the creation of centrally planned economies directed by a state that owns all the means of production. Others, including Communists in Yugoslavia and Hungary in the 1970s and 1980s, Chinese Communists since the reform era, and some Western economists, have proposed various forms of market socialism, attempting to reconcile the presumed advantages of cooperative or state ownership of the means of production with letting market forces, rather than central planners, guide production and exchange. Anarcho-syndicalists and some elements of the U.S. New Left favor decentralized collective ownership in the form of cooperatives or workers' councils. Others may advocate different arrangements.
The Socialist International, the affiliate body for most of the world's social democratic parties, such as the Socialist Party of France, describes socialism as "an international movement for freedom, social justice and solidarity"
In the history of political thought, certain elements of a socialist or communist outlook long predate the socialism that emerged in the first half of the 19th Century. For instance, Plato's Republic and Thomas More's Utopia have been cited. The 5th century Mazdak movement in what is now Iran has been described as "communistic" for challenging the enormous privileges of the noble classes and the clergy and striving for an egalitarian society. William Morris considered that John Ball, one of the leaders of the Peasants' Revolt in England in 1381, was the first socialist. John Ball is credited with the famous saying:
"When Adam delved and Eve span, Who was then the gentleman?"
During the English Civil War in the mid 17th Century, movements identified with the socialist tradition include the levellers and the diggers, the latter believing that land should be held in common.
During the 18th-century Enlightenment, criticism of inequality appeared in the work of political theorists such as Jean Jacques Rousseau in France, whose Social Contract famously began, "Man is born free, and he is everywhere in chains." Following the French Revolution of 1789, François Noël Babeuf espoused the goals of common ownership of land and total economic and political equality among citizens.
Origins of socialism
The appearance of the term "socialism" is variously attributed to Pierre Leroux in 1834, or to Marie Roch Louis Reybaud in France, or else in England to Robert Owen, who is considered the father of the cooperative movement.
The first modern socialists were early 19th century Western European social critics. In this period, socialism emerged from a diverse array of doctrines and social experiments associated primarily with British and French thinkers - especially Robert Owen, Charles Fourier, Pierre-Joseph Proudhon, Louis Blanc, and Saint-Simon. These social critics criticised the excesses of poverty and inequality of the Industrial Revolution, and advocated reforms such as the egalitarian distribution of wealth and the transformation of society into small communities in which private property was to be abolished. Outlining principles for the reorganization of society along collectivist lines, Saint-Simon and Owen sought to build socialism on the foundations of planned, utopian communities.
According to some accounts, the use of the words "socialism" or "communism" was related to the perceived attitude toward religion in a given culture. In Europe, "communism" was considered to be the more atheistic of the two. In England, however, that sounded too close to communion with Catholic overtones; hence atheists preferred to call themselves socialists
By 1847, according to Frederick Engels, "Socialism" was "respectable" on the continent of Europe, while "Communism" was the opposite; the Owenites in England and the Fourierists in France were considered Socialists, while working class movements which "proclaimed the necessity of total social change" termed themselves "Communists". This latter was "powerful enough" to produce the communism of Étienne Cabet in France and Wilhelm Weitling in Germany.
Saint Simon, who is called the founder of French socialism, argued that a brotherhood of man must accompany the scientific organization of industry and society. He proposed that production and distribution be carried out by the state, and that allowing everyone to have equal opportunity to develop their talents would lead to social harmony, and the state could be virtually eliminated. "Rule over men would be replaced by the administration of things."
Robert Owen advocated the transformation of society into small, local collectives without such elaborate systems of social organization. Owen was a mill manager from 1800-1825. He transformed life in the village of New Lanark with ideas and opportunities which were at least a hundred years ahead of their time. Child labour and corporal punishment were abolished, and villagers were provided with decent homes, schools and evening classes, free health care, and affordable food.
The UK government's Factory Act of 1833 attempted to reduce the hours adults and children worked in the textile industry. A fifteen hour working day was to start at 5.30 a.m. and cease at 8.30 p.m. Children of nine to thirteen years could be worked no more than 9 hours, and those of a younger age were prohibited. There were, however, only four factory inspectors, and this law was broken by the factory owners. In the same year Owen stated:
In a Paper Dedicated to the Governments of Great Britain, Austria, Russia, France, Prussia and the United States of America written in 1841, Owen wrote: "The lowest stage of humanity is experienced when the individual must labour for a small pittance of wages from others."
Proudhon pronounced that "Property is theft" and that socialism was "every aspiration towards the amelioration of society". Proudhon termed himself an anarchist and proposed that free association of individuals should replace the coercive state. Proudhon, Benjamin Tucker, and others developed these ideas in a free-market direction, while Mikhail Bakunin, Piotr Kropotkin, and others adapted Proudhon's ideas in a more conventionally socialist direction.
In a letter to Marx in 1846, Proudhon wrote:
Bakunin the father of modern anarchism, was a libertarian socialist, a theory by which the workers would directly manage the means of production through their own productive associations. There would be "equal means of subsistence, support, education, and opportunity for every child, boy or girl, until maturity, and equal resources and facilities in adulthood to create his own well-being by his own labor."
While many socialists emphasized the gradual transformation of society, most notably through the foundation of small, utopian communities, a growing number of socialists became disillusioned with the viability of this approach and instead emphasized direct political action. Early socialists were united, however, in their desire for a society based on cooperation rather than competition.
Marxism and the socialist movement
In 1848, Karl Marx and Frederick Engels published the Communist Manifesto. Marx and Engels drew from the socialist or communist ideas born in the French Revolution of 1789, the German philosophy of GWF Hegel, and English political economy, particularly that of Adam Smith and David Ricardo. Marx and Engels developed a body of ideas which they called scientific socialism, more commonly called Marxism.
The Communist Manifesto says "The history of all hitherto existing society is the history of class struggles" and famously declared that the working class would be the "grave digger" of the capitalist class.
Marx and Engels distinguished their scientific socialism from what they termed the utopian socialism of some other socialist trends. For Marxists, socialism or, as Marx termed it, the first phase of communist society, can be viewed as a transitional stage characterized by common or state ownership of the means of production under democratic workers' control and management, which Engels argued was beginning to be realised in the Paris Commune of 1871, before it was overthrown. They see this stage in history as a transition between capitalism and the "higher phase of communist society" in which human beings no longer suffer from alienation and "all the springs of co-operative wealth flow more abundantly." Here "society inscribe[s] on its banners: From each according to his ability, to each according to his needs!" For Marx, a communist society entails the absence of differing social classes and thus the end of class warfare. According to Marx and Engels, once a socialist society had been ushered in, the state would begin to "wither away", and humanity would be in control of its own destiny for the first time.
Marx and Engels argued that capitalism "compels all nations, on pain of extinction, to adopt the bourgeois mode of production" and raised the seminal call, "Proletarians of all countries, unite".
The International Workingmen's Association - the First International
In 1864, the International Workingmen's Association (IWA) or First International, was founded in London. Victor Le Lubez, a French radical republican living in London, invited Marx to come, "as a representative of German workers", according to Saul Padover. The IWA held a preliminary conference in 1865 and its first congress at Geneva in 1866. Marx was appointed a member of the committee and, according to Padover, Marx and Johann Georg Eccarius, a tailor living in London, were to become, "the two mainstays of the International from its inception to its end". The First International became the first major international forum for the promulgation of socialist ideas.
The Social Democratic Workers' Party of Germany was founded in 1869 under the influence of Marx and Engels. In 1875, it merged with the General German Workers' Association of Ferdinand Lassalle to become what is known today as the German Social Democratic Party (SPD). Socialism became increasingly associated with newly formed trade unions. In Germany, the SPD built trade unions and in Austria, France and other European countries, socialist parties and anarchists played a prominent role in forming and building up trade unions, especially from the 1870s onwards. This stood in contrast to the British experience, where moderate New Model Unions dominated the union movement from the mid-nineteenth century and where trade unionism was stronger than the political labour movement until the formation and growth of the Labour Party in the early years of the twentieth century.
Socialist groups supported diverse views of socialism, from the gradualism of many trade unionists to the radical, revolutionary theory of Marx and Engels. Anarchists and proponents of other alternative visions of socialism, who emphasized the potential of small-scale communities and agrarianism, coexisted with the more influential currents of Marxism and social democracy. The anarchists, led by the Russian Mikhail Bakunin, believed that capitalism and the state were inseparable and that one could not be abolished without the other.
In 1871, in the wake of the Franco-Prussian War, an uprising in Paris established the Paris Commune. According to Marx and Engels, for a few weeks the Paris Commune provided a glimpse of a socialist society, before it was brutally suppressed by the French government.
In the Paris Commune, large-scale industry was to be "based on the association of the workers" joined into "one great union", all posts in government were elected by universal franchise, elected officials took only the average worker's wage and were subject to recall. For Engels, this was what the dictatorship of the proletariat looked like (as opposed to the "dictatorship of the bourgeoisie", which was capitalism). Engels goes on to state: "In reality, however, the state is nothing but a machine for the oppression of one class by another, and indeed in the democratic republic no less than in the monarchy; and at best an evil inherited by the proletariat after its victorious struggle for class supremacy", and a new generation of socialists, "reared in new and free social conditions, will be able to throw the entire lumber of the state on the scrap-heap".
After the Paris Commune, the differences between supporters of Marx and Engels and those of Bakunin were too great to bridge. The anarchist section of the First International was expelled from the International at the 1872 Hague Congress and they went on to form the Jura federation. The First International was disbanded in 1876.
The Second International
As the ideas of Marx and Engels took on flesh, particularly in central Europe, socialists sought to unite in an international organisation. In 1889, on the centennial of the French Revolution of 1789, the Second International was founded, with 384 delegates from 20 countries representing about 300 labour and socialist organizations. It was termed the "Socialist International" and Engels was elected honorary president at the third congress in 1893.
Just before his death in 1895, Engels argued that there was now a "single generally recognised, crystal clear theory of Marx" and a "single great international army of socialists". Despite its illegality due to the Anti-Socialist Laws of 1878, the Social Democratic Party of Germany's use of the limited universal male suffrage were "potent" new methods of struggle which demonstrated their growing strength and forced the dropping of the Anti-Socialist legislation in 1890, Engels argued. In 1893, the German SPD obtained 1,787,000 votes, a quarter of votes cast. However before the leadership of the SPD published Engels' 1895 Introduction to Marx's Class Struggles in France 1848-1850, they removed certain phrases they felt were too revolutionary.
Marx believed that it was possible to have a peaceful socialist transformation in England, although the British ruling class would then revolt against such a victory. America and Holland might also have a peaceful transformation, but not in France, where Marx believed there had been "perfected... an enormous bureaucratic and military organisation, with its ingenious state machinery" which must be forcibly overthrown. However, eight years after Marx's death, Engels argued that it was possible to achieve a peaceful socialist revolution in France, too.
The SPD was by far the most powerful of the social democratic parties. Its votes reached 4.5 million, it had 90 daily newspapers, together with trade unions and co-ops, sports clubs, a youth organisation, a women's organisation and hundreds of full time officials. Under the pressure of this growing party, Bismarck introduced limited welfare provision and working hours were reduced. Germany experienced sustained economic growth for more than forty years. Commentators suggest that this expansion, together with the concessions won, gave rise to illusions amongst the leadership of the SPD that capitalism would evolve into socialism gradually.
Beginning in 1896, in a series of articles published under the title "Problems of socialism", Eduard Bernstein argued that an evolutionary transition to socialism was both possible and more desirable than revolutionary change. Bernstein and his supporters came to be identified as "revisionists" because they sought to revise the classic tenets of Marxism. Although the orthodox Marxists in the party, led by Karl Kautsky, retained the Marxist theory of revolution as the official doctrine of the party, and it was repeatedly endorsed by SPD conferences, in practice the SPD leadership became increasingly reformist.
Bernstein coined the aphorism: "The movement is everything, the final goal nothing". But the path of reform appeared blocked to the Russian Marxists while Russia remained the bulwark of reaction. In the preface to the 1882 Russian edition to the Communist Manifesto, Marx and Engels had saluted the Russian Marxists who, they said, "formed the vanguard of revolutionary action in Europe". But the working class, although many were organised in vast modern western-owned enterprises, comprised no more than a small percentage of the population and "more than half the land is owned in common by the peasants". Marx and Engels posed the question: How was Russia to progress to socialism? Could Russia "pass directly" to socialism or "must it first pass through the same process" of capitalist development as the West? They replied: "If the Russian Revolution becomes the signal for a proletarian revolution in the West, so that both complement each other, the present Russian common ownership of land may serve as the starting point for a communist development."
In 1903, the Russian Social Democratic Labour Party began to split on ideological and organizational questions into Bolshevik ('Majority') and Menshevik ('Minority') factions, with Russian revolutionary Vladimir Lenin leading the more radical Bolsheviks. Both wings accepted that Russia was an economically backward country unripe for socialism. The Mensheviks awaited the capitalist revolution in Russia. But Lenin argued that a revolution of the workers and peasants would achieve this task. After the Russian revolution of 1905, Leon Trotsky argued that unlike the French revolution of 1789 and the European Revolutions of 1848 against absolutism, the capitalist class would never organise a revolution in Russia to overthrow absolutism, and that this task fell to the working class who, liberating the peasantry from their feudal yoke, would then immediately pass on to the socialist tasks and seek a "permanent revolution" to achieve international socialism. Assyrian nationalist Freydun Atturaya tried to create regional self-government for the Assyrian people with the socialism ideology. He even wrote the Urmia Manifesto of the United Free Assyria. However, his attempt was put to an end by Russia.
In 1877, the Socialist Labor Party of America was founded in the USA. This party, which advocated Marxism, was a confederation of small Marxist parties from throughout the United States, and came under the leadership of Daniel De Leon. In 1901, a merger between opponents of De Leon and the younger Social Democratic Party joined with Eugene V. Debs to form the Socialist Party of America. This party grew to 150,000 in 1912 and polled 897,000 votes in the presidential campaign of that year, 6 percent of the total vote. It declined after the First World war.
In 1905, the Industrial Workers of the World formed from several independent labor unions. The IWW opposed the political means of Debs and De Leon, as well as the craft unionism of Samuel Gompers.
French socialism was beheaded by the suppression of the Paris commune (1871), its leaders killed or exiled. But in 1879, at the Marseille Congress, workers' associations created the Federation of the Socialist Workers of France. Three years later, Jules Guesde and Paul Lafargue, the son-in-law of Karl Marx, left the federation and founded the French Workers' Party.
The Federation of the Socialist Workers of France was termed "possibilist" because it advocated gradual reforms, whereas the French Workers' Party promoted Marxism. In 1905 these two trends merged to form the French Section Française de l'Internationale Ouvrière (SFIO), led by Jean Jaurès and later Léon Blum. In 1906 it won 56 seats in Parliament. The SFIO adhered to Marxist ideas but became, in practice, a reformist party. By 1914 it had more than 100 members in the Chamber of Deputies.
First World War
When the First World War began in 1914, many European socialist leaders supported their respective governments' war aims. The social democratic parties in the UK, France, Belgium and Germany supported their respective state's wartime military and economic planning, discarding their commitment to internationalism and solidarity.
Lenin, however, denounced the war as an imperialist conflict, and urged workers worldwide to use it as an occasion for proletarian revolution. The Second International dissolved during the war, while Lenin, Trotsky, Karl Liebknecht and Rosa Luxemburg, together with a small number of other Marxists opposed to the war, came together in the Zimmerwald Conference in September 1915.
While on the continent of Europe and elsewhere by the end of the Nineteenth Century the various sources of socialism were tributaries to the "mighty stream of the Marxist movement", in the socialist movement in Britain, the world's pre-eminent power at this time, Marxism remained only one strand of opinion, mixing with Christian socialism, ethical socialism, Fabianism, cooperativism, and other trends. When, in the general election of 1945, the Labour Party won a clear parliamentary majority and carried out extensive reforms, its largely non-Marxist leadership was conscious of this socialist heritage.
The Christian Socialist movement was led by Frederick Denison Maurice , JMF Ludlow and Charles Kingsley in 1848. At this time, rather than pursue the Chartist aim of establishing a universal franchise, "they wanted to Christianise socialism and Chartism and, at the beginning of the twentieth century, they wanted to form a whole country of religiously based guilds as a development of guild socialism". The Nonconformist Christian Socialist League was established in 1894, and the Church of England Church Socialist League was established in 1906. They shared a rejection of that political economy which supported individualist competitive markets, whose failings in the industrial revolution had been exposed by Samuel Taylor Coleridge, Thomas Carlyle, Thomas Arnold and John Ruskin.
Ludlow in particular was inspired by Fourier, believed strongly in democracy, and influenced R. H. Tawney, a devout Christian who had an enormous influence on the interwar Labour Party leadership’s outlook, and on the revisionist school of Anthony Crossland and others after 1945. In particular, he and others gave moral and philosophical guidance to the rejection of 'orthodox' economic policy and the embracing of high levels of taxation of wealthy business owners, and indeed, nationalisation if needs be, which coincided with the arguments of those such as Marxist and Labour Party chairman, Harold J Laski. Rejecting the arguments in favour of a meritocracy and attacking Adam Smith's famous concept of the "invisible hand" of the market in capitalist society, Tawney argued in 1931:
In 1884, middle class intellectuals organized the Fabian Society, a moderate form of socialism in opposition to Marxist ideas. This society did not seek to build its membership, but only to influence the leaders of the labour movement, which it continues to do to the present day. The Fabians embraced individual susch as Tawney, who was a member from 1906.
Socialist ideas also began to spread amongst the British working class. In 1881, the Marxist Social Democratic Federation met for the first time, and in 1888 the successful Matchgirls Strike began a period of New Unionism in which members and former members of the Social Democratic Federation played a prominent role. In 1889, Will Thorne, who was taught to read by Eleanor Marx, organized the Gasworkers, and gained a reduction in the working week from twelve to eight hours a day. In the same year, the London Dock Strike of 1889, organized by Tom Mann and Ben Tillett, (who like Thorne had been members of the Social Democratic Federation), won significant gains and was seen as a landmark in British trade unionism.
The new unions brought a new socialist consciousness to the trade union movement. In 1899, the Amalgamated Society of Railway Servants proposed that the Trade Union Congress call a special conference to bring together the trade unions and all the left-wing organisations, to sponsor Parliamentary candidates independent of the Liberal Party. In 1900, the trade unions, together with the Independent Labour Party, the Social Democratic Federation and the Fabians, founded the Labour Representation Committee, which became the Labour Party in 1906. The Cooperative movement, which traces its foundation to the work of Robert Owen, although not represented at the founding conference of 1900, nevertheless affiliated soon after to become a core affiliate of the Labour Party.
In the first decades of the 20th Century, the concept of Guild Socialism was championed by G.D.H. Cole: "It follows that there must be, in the Society, as many separately elected groups of representatives as there are distinct essential groups of functions to be performed." Each factory, workshop, etc, has a representative council and internal autonomy. The administration of an industry is to be a federation of such groups.
The Revolutions of 1917-23
By 1917, the atmosphere of enthusiastic patriotism which had greeted the start of the First World War had evapourated and was replaced by an upsurge of radicalism in most of Europe and as far afield as the United States (see Socialism in the United States) and Australia.
In February 1917, revolution broke out in Russia and the workers, soldiers and peasants set up workers', soldiers' and peasants' councils (in Russian, soviets), while power was placed into the hands of a Provisional government prior to the convocation of a Constituent Assembly. Lenin arrived in Russia in April 1917 and called for "All power to the Soviets". The Bolsheviks won a majority in the Soviets in October 1917 and at the same time the October Revolution was led by Lenin and Trotsky. At the Petrograd Soviet on the 25 October 1917, Lenin declared, "Long live the world socialist revolution!"
The elections to the Constituent Assembly were held in November 1917 and were won by the non-Marxist, peasant-based Socialist-Revolutionary (SR) party with almost twice as many votes as the Bolsheviks. The Constituent Assembly was convened for 13 hours between between 4 p.m. and 4:40 a.m., January 5-6, 1918. The SR leader Victor Chernov was elected President of the fledgling republic. The following day the Bolsheviks dissolved the assembly.
In this period, few Communists - least of all Lenin and Trotsky - doubted that the success of socialism in Soviet Russia depended on successful socialist revolutions carried out by the working classes of the most developed capitalist counties. For this reason, in 1919, Lenin and Trotsky drew together the Communist Parties from around the world into a new 'International', the Communist International (also termed the Third International or Comintern).
The new Soviet government immediately nationalised the banks and major industry, and repudiated the former Romanov regime's national debts. It implemented a system of government through the elected workers' councils or soviets. It sued for peace and withdrew from the First World War.
Arguably for the first time, socialism was not just a vision of a future society, but a description of an existing one, at least in embryo. On 26 October 1917, the day after seizing power, Lenin drew up a Draft Regulations on Workers' Control, granting workers' control in enterprises with not less than five workers and office employees, who were to be granted access to all books, documents and stocks, and whose decisions were to be "binding upon the owners of the enterprises".
The Russian revolution of October 1917 gave rise to the formation of Communist Parties around the world, and the revolutions of 1917-23 which followed.
The German Revolution of 1918 overthrew the old absolutism and, as in Russia, Workers' and Soldiers' Councils almost entirely made up of SPD and Independent Social Democrats (USPD) members were set up. The Weimar republic was established and placed the SPD in power, under the leadership of Friedrich Ebert. The Workers' and Soldiers' Councils were put down by the army and the Freikorps. In 1919 the Spartacist uprising challenged the power of the SPD government, but it was put down in blood and the German Communist leaders Karl Liebknecht and Rosa Luxemburg were discovered and brutally murdered. A Communist regime under Kurt Eisner in Bavaria in 1919 was also put down in blood.
A Communist regime briefly held power under Béla Kun in Hungary. There were revolutionary movements in Vienna, the industrial centres of northern Italy, and revolutionary movements in the Ruhr area in Germany in 1920 and in Saxony in 1923.
However, these revolutionary movements failed to spread the socialist revolution into the advanced capitalist countries of Europe. In Soviet Russia things were desperate. In August 1918, Lenin was shot in the head and wounded by Fanya Kaplan. Under siege from a trade boycott and invasion by Germany, UK, USA, France and other forces, facing civil war and starvation, the Soviet regime implemented War Communism in June, 1918. All private enterprise was made illegal, strikers could be shot, "non-working classes" were forced to work and the Soviet regime could requisition grain from the peasants for the workers in the cities.
By 1920, the Red Army, led by Trotsky, had largely defeated the White Armies. In 1921, War Communism was ended, and under the New Economic Policy (NEP), private ownership was restored to small and medium enterprises, and especially to the peasants. The peasants had resented and hindered the requisitions of grain so that the situation in the cities remained desperate or was getting worse. Lenin declared that the "commanding heights" of industry would still be under state control, but that the NEP was a capitalist measure in a country that was still largely unripe for socialism. Businessmen and women, called 'NEPmen', began to flourish, and the rich peasant (or 'Kulak', meaning 'fist') gained more power.
Lenin, now half paralysed from several strokes, castigated the powers the state had assumed in the Soviet Union by 1923. It had reverted to "a bourgeois czarist machine... barely varnished with socialism". After Lenin's death in January 1924, the Communist Party of the Soviet Union, falling steadily under the control of Stalin, rejected the theory that socialism could not be built in the Soviet Union on its own. Stalin declared a policy of "socialism in one country", namely the Soviet Union. Despite demands by the increasingly marginalised Left Opposition for the restoration of soviet democracy, the Soviet Union continued to develop a bureaucratic and authoritarian model of social development, which was condemned by moderate socialists, Trotskyists and others for undermining the initial socialist ideals of the Russian Revolution.
The inter-war era and World War II
The Russian Revolution of October 1917 brought about the definitive ideological division between Communists as denoted with a capital "C" on the one hand and other communist and socialist trends such as anarcho-communists and social democrats, on the other. The Left Opposition in the Soviet Union gave rise to Trotskyism which was to remain isolated and insignificant for another fifty years, except in Sri Lanka where Trotskyism gained the majority and the pro-Moscow wing was expelled from the Communist Party.
In 1922, the fourth congress of the Communist International took up the policy of the United Front, urging Communists to work with rank and file Social Democrats while remaining critical of their leaders, who they criticised for "betraying" the working class by supporting the war efforts of their respective capitalist classes. For their part, the social democrats pointed to the dislocation caused by revolution, and later, the growing authoritarianism of the Communist Parties. When the Communist Party of Great Britain applied to affiliate to the Labour Party in 1920 it was turned down.
Once the world's most powerful nation, Britain avoided a revolution during the period of 1917-1923 but was significantly affected by revolt. The Prime Minister, Lloyd George, had promised the troops in the 1918 election that his Conservative-led coalition would make post-war Britain "a fit land for heroes to live in". But many demobbed troops complained of chronic unemployment and suffered low pay, disease and poor housing.
In 1918, the Labour Party adopted as its aim to secure for the workers, "the common ownership of the means of production, distribution and exchange". In 1919, the Miners Federation, whose Members of Parliament pre-dated the formation of the Labour Party and were since 1906 a part of that body, demanded the withdrawal of British troops from Soviet Russia. The 1919 Labour Party conference voted to discuss the question of affiliation to the Third (Communist) International, "to the distress of its leaders". A vote was won committing the Labour Party committee of the Trades Union Congress to arrange "direct industrial action" to "stop capitalist attacks upon the Socialist Republics of Russia and Hungary." The threat of immediate strike action forced the Conservative-led coalition government to abandon its intervention in Russia.
In 1914 the unions of the transport workers, the mine workers and the railway workers had formed a Triple Alliance. In 1919, Lloyd George sent for the leaders of the Triple Alliance, one of whom was miner's leader Robert Smillie, a founder member of the Independent Labour Party in 1889 who was to become a Labour Party MP in the first 1924 Labour government. According to Smillie, Lloyd George said:
"From that moment on", Smillie conceded to Aneurin Bevan, "we were beaten and we knew we were". When the UK General Strike of 1926 broke out, the trade union leaders, "had never worked out the revolutionary implications of direct action on such a scale", Bevan says. Bevan was a member of the Independent Labour Party and one of the leaders of the South Wales miners during the strike. The TUC called off the strike after nine days. In the North East of England and elsewhere, "councils of action" were set up, with many rank and file Communist Party members often playing a critical role. The councils of action took control of essential transport and other duties. When the strike ended, the miners were locked out and remained locked out for six months. Bevan became a Labour MP in 1929.
In January 1924, the Labour Party formed a minority government for the first time with Ramsay MacDonald as prime minister. The Labour Party intended to ratify an Anglo-Russian trade agreement, which would break the trade embargo on Russia. This was attacked by the Conservatives and new elections took place in October 1924. Four days before polling day the Daily Mail published the Zinoviev letter, a forgery that claimed the Labour Party had links with Soviet Communists and was secretly fomenting revolution. The fears instilled by the press of a Labour Party in secret Communist manoeuvres, together with the half-hearted "respectable" policies pursued by MacDonald, led to Labour losing the October 1924 general election. The victorious Conservatives repudiated the Anglo-Soviet treaty.
The leadership of the Labour Party, like social democratic parties almost everywhere, (with the exception of Sweden and Belgium), tried to pursue a policy of moderation and economic orthodoxy. At times of depression this policy was not popular with the Labour Party’s working class supporters. The influence of Marxism grew in the Labour Party during the inter-war years. Anthony Crosland argued in 1956 that under the impact of the 1931 slump and the growth of fascism, the younger generation of left-wing intellectuals for the most part "took to Marxism" including the "best-known leaders" of the Fabian tradition, Sidney and Beatrice Webb. The Marxist Professor Harold Laski, who was to be chairman of the Labour Party in 1945-6, was the "outstanding influence" in the political field.
The Marxists within the Labour Party differed in their attitude to the Communists. Some were uncitical and some were expelled as "fellow travellers", while in the 1930s others were Trotskyists and sympathisers working inside the Labour Party, especially in its youth wing where they were influential.
In the general election of 1929 the Labour Party won 288 seats out of 615 and formed another minority government. The depression of that period brought high unemployment and Prime Minister MacDonald sought to make cuts in order to balance the budget. The trade unions opposed MacDonald’s proposed cuts and he split the Labour government to form the National Government of 1931. This experience moved the Labour Party leftward, and at the start of the Second World War an official Labour Party pamphlet written by Harold Laski argued that, "the rise of Hitler and the methods by which he seeks to maintain and expand his power are deeply rooted in the economic and social system of Europe... economic nationalism, the fight for markets, the destruction of political democracy, the use of war as an instrument of national policy":
In the USA, the Communist Party USA was formed in 1919 from former adherents of the Socialist Party of America. One of the founders, James Cannon, later became the leader of Trotskyist forces outside the Soviet Union.
The Great Depression began in the United States on Black Tuesday, October 29, 1929. Unemployment rates passed 25%, prices and incomes fell 20-50%, but the debts remained at the same dollar amount. 9,000 banks failed during the decade of the 30s. By 1933, depositors saw $140 billion of their deposits disappear due to uninsured bank failures.
Workers organized against their deteriorating conditions and socialists played a critical role. In 1934 the Minneapolis Teamsters Strike led by the Trotskyist Communist League of America, the West Coast Longshore Strike led by the Communist Party USA, and the Toledo Auto-Lite Strike led by the American Workers Party, played an important role in the formation of the Congress of Industrial Organizations (CIO) in the USA.
In Minnesota, the General Drivers Local 574 of the International Brotherhood of Teamsters struck, despite an attempt to block the vote by AFL officials, demanding union recognition, increased wages, shorter hours, overtime rates, improved working conditions and job protection through seniority. In the battles that followed, which captured country-wide media attention, three strikes took place, martial law was declared and the National Guard was sent in. Two strikers were killed. Protest rallies of 40,000 were held. Farrell Dobbs, who became the leader of the local, had at the outset joined the "small and poverty-stricken" Communist League of America, founded by James P. Cannon and others in 1928 after their expulsion from the Communist Party USA for Trotskyism.
Success for the CIO quickly followed its formation. In 1937, one of the founding unions of the CIO, the United Auto Workers, won union recognition at General Motors Corporation after a tumultuous forty-four day sit-down strike, while the Steel Workers Organizing Committee, which was formed by the CIO, won a collective bargaining agreement with U.S. Steel. The CIO merged with the AFl in 1955 becoming the AFL-CIO.
In 1928, the Communist International, now fully under the leadership of Stalin, turned from the united front policy to an ultra-left policy of the Third Period, a policy of aggressive confrontation of social democracy. This divided the working class at a critical time.
Like the Labour Party in the UK, the Social Democratic Party in Germany, which was in power in 1928, followed an orthodox deflationary policy and pressed for reductions in unemployment benefits in order to save taxes and reduce budget deficits. These policies did not halt the recession and the government resigned.
The Communists described the Social Democratic leaders as "social fascists" and in the Prussian Landtag they voted with the Nazis to bring down the Social Democratic government. Fascism continued to grow, with powerful backing from industrialists, especially in heavy industry, and Hitler was invited into power in 1933.
Hitler's regime swiftly destroyed both the German Communist Party and the Social Democratic Party, the worst blow the world socialist movement had ever suffered. This forced Stalin to reassess his strategy, and from 1935 the Comintern began urging the formation of Popular Fronts, which were to include not just the Social Democratic parties but critically also "progressive capitalist" parties which were wedded to a capitalist policy.
After the election of a Popular Front government in Spain in 1936 a fascist military revolt led to the Spanish Civil War. The crisis in Spain brought down the Popular Front government in France under Léon Blum. Ultimately the Popular Fronts were not able to prevent the spread of fascism or the aggressive plans of the fascist powers. Trotskyists considered Popular Fronts a "strike breaking conspiracy", an impediment to successful resistance to fascism due to their inclusion of pro-capitalist parties which demanded policies of opposition to strikes and workers’ actions against the capitalist class.
The Swedish Socialists formed a government in 1932. They broke with economic orthodoxy during the depression and carried out extensive public works financed from government borrowing. They emphasised large-scale intervention and the high unemployment they had inherited was eliminated by 1938. Their success encouraged the adoption of Keynesian policies of deficit financing pursued by almost all Western countries after World War Two.
Socialism after World War Two
The bi-polar world
In 1945, the world’s three great powers met at the Yalta Conference to divide the world between them. UK Prime Minister Winston Churchill joined USA President Franklin D. Roosevelt and Joseph Stalin, General Secretary of the Communist Party of the Soviet Union's Central Committee. With the relative decline of Britain compared to the two superpowers, the USA and the Soviet Union, however, many viewed the world as "bi-polar" - a world with two irreconcilable and antagonistic political and economic systems. Many termed the Soviet Union "socialist", not least the Soviet Union itself, but also commonly in the USA, China, Eastern Europe, and many parts of the world where Communist Parties had gained a mass base. In addition, scholarly critics of the Soviet Union, such as Friedrich Hayek, the Austrian-British economist and political philosopher, were commonly cited as critics of socialism.
This view was not universally shared, particularly in Europe, and especially in Britain, where the Communist Party was very weak. In 1951, British Health Minister Aneurin Bevan expressed the view that, "It is probably true that Western Europe would have gone socialist after the war if Soviet behaviour had not given it too grim a visage. Soviet Communism and Socialism are not yet sufficiently distinguished in many minds."
In 1949, the Chinese Revolution established a Communist state in China. Criticising the invasion and trade embargo of the young Soviet state, Bevan wrote "At the moment it looks as though the United States is going to repeat the same folly in China... You cannot starve a national revolution into submission. You can starve it into a repressive dictatorship; you can starve it to the point where the hellish logic of the police state takes charge."
In 1951, the Socialist International was refounded by the European social democratic parties. It declared: "Communism has split the International Labour Movement and has set back the realisation of Socialism in many countries for decades... Communism falsely claims a share in the Socialist tradition. In fact it has distorted that tradition beyond recognition. It has built up a rigid theology which is incompatible with the critical spirit of Marxism."
Social Democracy in power
In 1945, the British Labour Party led by Clement Attlee was swept to power on a radical programme. Socialist (and in some places Communist) parties also dominated postwar governments in France, Italy, Czechoslovakia, Belgium, Norway and other European countries. The Social Democratic Party had been in power in Sweden since 1932, and Labour parties also held power in Australia and New Zealand. In Germany, on the other hand, the Social Democrats were defeated in Germany's first democratic elections in 1949. The unity of the democrats and the Communist parties which had been established in the wartime resistance movements continued in the immediate postwar years. The democratic socialist parties of Eastern Europe, however, were destroyed when Stalin imposed so-called "Communist" regimes in these countries.
The social democratic governments in the post war period introduced measures of social reform and wealth redistribution through state welfare and taxation policy. For instance the newly elected UK Labour government carried out nationalisations of major utilities such as mines, gas, coal, electricity, rail, iron and steel, and the Bank of England. France claimed to be the most state controlled capitalist country in the world, carrying through many nationalisations.
In the UK the National Health Service was established bringing free health care to all for the first time. Social housing for working class families was provided in council housing estates and university education was made available for working class people through a grant system. Free school milk was introduced by Ellen Wilkinson, Minister for Education, who told the 1946 Labour Party conference: "Free milk will be provided in Hoxton and Shoreditch, in Eton and Harrow. What more social equality can you have than that?" Attlee's biographer argues that this "contributed enormously to the defeat of childhood illnesses resulting from bad diet. Generations of poor children grew up stronger and healthier because of this one small and inexpensive act of generosity by the Attlee government".
In 1956, Anthony Crosland estimated that 25% of industry was nationalised in the UK, and that public authorities accounted for a similar percentage of total employment, including the nationalised industries. However the parliamentary leadership of the social democracies in general had no intention of ending capitalism, and their national outlook and their dedication to the maintenance of the post-war 'order' prevented the social democracies from moving to nationalize the "commanding heights" of industry. They were termed 'socialist' by all in 1945, but in the UK, for instance, where Social Democracy had a large majority in Parliament, "The government had not the smallest intention of bringing in the 'common ownership of the means of production, distribution and exchange'" as written in Clause 4 of the Labour Party constitution. In Germany, the Social Democratic Party adopted the Godesberg Program in 1959, which rejected class struggle and Marxism.
In the UK, cabinet minister Herbert Morrison famously argued that, "Socialism is what the Labour government does", and Anthony Crosland argued that capitalism had been ended, stating: "To the question 'Is this still capitalism?' I would answer 'No'."
Social democracy at first took the view that they had begun a "serious assault" on the five "Giant Evils" afflicting the working class, identified for instance by the British social reformer William Beveridge: "Want, Disease, Ignorance, Squalor, and Idleness". However on the left wing of the Labour Party, Aneurin Bevan, who had been responsible for introducing the Labour Party’s National Health Service in 1945, criticised the government for not going further. Bevan demanded that the "main streams of economic activity are brought under public direction" with economic planning, and criticised the Labour Party's implementation of nationalisation for not empowering the workers in the nationalised industries with democratic control over their operation. In his In Place of Fear, which Crosland called the "the most widely read socialist book" of the period, Bevan begins: "A young miner in a South Wales colliery, my concern was with one practical question: Where does the power lie in this particular state of Great Britain, and how can it be attained by the workers?"
The Frankfurt Declaration of the refounded Socialist International stated:
Low unemployment and rising living standards across Europe was achieved, in the view of socialists, by the efforts of trade union struggle, social reform by social democracy, and the ushering in of what was termed a "mixed economy". Many on the left, including the far left Trotskyists, expected at first that the pattern of financial instability and recession of the 1930s to return. But it was widely believed that the boom and bust of the inter-war years had been abolished until the 1973 oil crisis and the simultaneous world recession which followed.
In North America the Co-operative Commonwealth Federation of Tommy Douglas won an overwhelming victory in the Canadian province of Saskatchewan toppling the age old Liberal regime which had dominated Saskatchewan politics since the founding of the province in 1905. Douglas and the CCF went on to win five consecutive electoral victories. During his time in office he created the Saskatchewan Power Corp. which extended electricity services to the many rural villages and farms who before did without, created Canada's first public automobile insurance agency, created a substantial number of Crown Corporations (government and public owned businesses) many of which still exist today in Saskatchewan, allowed the unionization of the public service, created the first system of Universal Health Care in Canada (which would later be adopted nationally in 1965 becoming something Canadians identify with proudly), and created Saskatchewan's Bill of Rights, the first such charter in Canada. This preceded the Canadian Charter of Rights and Freedoms as well as the previous Canadian Bill of Rights.
The New Democratic Party (as the CCF became known in 1962) went on to dominate the politics of Saskatchewan and form governments in British Columbia, Manitoba, Ontario, and the Yukon Territory. Nationally the NDP would become very influential during four minority governments, and is today by far Canada's most successful left-wing political party. In 2004 Canadians voted Tommy Douglas in as The Greatest Canadian as part of a nation-wide contest organized by the Canadian Broadcasting Corporation (CBC).
In the postwar years, socialism became increasingly influential throughout the so-called Third World. Countries in Africa, Asia, and Latin America frequently adopted socialist economic programs. In many instances, these nations nationalized industries held by foreign owners. The Soviet Union had become a superpower through its adoption of a planned economy, albeit at enormous human cost. This achievement seemed hugely impressive from the outside, and convinced many nationalists in the former colonies, not necessarily communists or even socialists, of the virtues of state planning and state-guided models of social development. This was later to have important consequences in countries like China, India and Egypt, which tried to import some aspects of the Soviet model.
Militancy, Socialism and the rise of neo-liberalism
In the 1960s and 1970s, new social forces began to change the political landscape in the Western world. Opposition to the Vietnam War was growing and becoming a focus for socialists, particularly the far left. The Campaign for Nuclear Disarmament (CND) mobilized many marches, the struggles of the Palestinian Liberation Organisation and the African National Congress, the Sandinista struggles in Nicaragua and other liberation struggles elsewhere often had a left-wing or socialist aspect.
The supporters of neo-liberalism argued that the long post-war boom, rising living standards for the industrial working class, and the rise of a mass university-educated white collar workforce was eroding the mass electoral base of European socialist parties. From this point of view, this new "post-industrial" white-collar workforce was less interested in traditional socialist policies such as state ownership and more interested in expanded personal freedom and liberal social policies.
In May 1968, 10 million workers struck against the government of General Charles De Gaulle, occupying the factories and workplaces. Reflecting the militancy of the period, the UK's Financial Times wrote:
The Economist was more explicit: "At this very moment, the one vital question in Paris is power - who holds it or who will seize it?" De Gaulle said the nation was "on the brink of paralysis", and warned of civil war if the situation continued. The powerful French Communist Party did not take power, but rose to 21% of the popular vote in elections for a period before significantly declining in support. In the last quarter of the twentieth century Western European Communist parties, which had abandoned any revolutionary goal and fully embraced electoral politics, split into pro-soviet and more critical Eurocommunist wings. Eurocommunism resembled earlier social-democratic configurations, although distinction between the two political tendencies persists.
In 1970, the successful Presidential election of the Marxist Salvador Allende, leader of the Chilean Socialist Party, led to a period of turmoil and in 1973 a coup by US backed General Pinochet. Allende committed suicide and many of his supporters were killed. The Rettig Report concluded that 2,279 persons who disappeared during the Pinochet military government were killed for political reasons, and approximately 30,000 tortured according to the later Valech Report, while several thousand were exiled. Pinochet said that he believed these operations were necessary in order to "save the country from communism".
In the UK, a Conservative government elected in 1970 faced 11 million days lost in strike action, doubling to over 22 million in 1972. By 1974, support for the miners' strike, particularly by the electrical power workers, together with other mounting industrial trade union activity and strikes led the government to declare a state of emergency, petrol rationing and power cuts. The government introduced a three day working week, and called a sudden general election in February 1974 to "let the voters decide who governs the country", the Government or the trade unions. The Conservative government lost the election and a minority Labour government took its place.
The world recession of 1973-5, coinciding with the 1973 oil crisis and persistently high inflation, showed that the social democratic methods of Keynesian demand management and the mixed economy had not overcome the boom and slump instability of capitalism. Keynesian was scrapped by both social democractic and conservative parties in favor of neo-liberal policy prescriptions.
In 1980, with the rise of Ronald Reagan in the U.S. and Margaret Thatcher in Britain, the Western welfare state found itself under increasing political pressure. Margaret Thatcher had abolished free school milk for children when Education Secretary in the 1970-74 Conservative government. Now monetarists and neoliberals attacked social welfare systems as an impediment to individual entrepreneurship. Western European socialists were under intense pressure to refashion their parties in the late 1980s and early 1990s and to reconcile their traditional economic programs with the integration of a European economic community based on liberalizing markets. The Labour Party in the United Kingdom went through a period of intense struggle, epitomised by Labour leader Neil Kinnock’s passionate and highly publicised 1985 Labour Party conference attack on the Militant Tendency and his repudiation of the demands of the miners who had been defeated after a year-long all-out strike against pit closures. By the 1990s, released from the pressure of the left, the Labour Party, especially under the premiership of Tony Blair, put together a set of policies based on encouraging the market economy while promoting the involvement of private industry in delivering public services.
In 1989, the 18th Congress of the Socialist International at Stockholm adopted a Declaration of Principles which declares that "Democratic socialism is an international movement for freedom, social justice and solidarity. Its goal is to achieve a peaceful world where these basic values can be enhanced and where each individual can live a meaningful life with the full development of his or her personality and talents and with the guarantee of human and civil rights in a democratic framework of society." The objectives of the Party of European Socialists, the socialist bloc in the European Parliament, are "to pursue international aims in respect of the principles on which the European Union is based, namely principles of freedom, equality, solidarity, democracy, respect of Human Rights and Fundamental Freedoms, and respect for the Rule of Law." The companion to contemporary political philosophy states: "The rallying cry of the French Revolution - equality, liberty and fraternity - now constitute essential socialist values."
In 1995, the UK Labour Party revised its aims: "The Labour Party is a democratic socialist party. It believes that by the strength of our common endeavour we achieve more than we achieve alone, so as to create for each of us the means to realise our true potential and for all of us a community in which power, wealth and opportunity are in the hands of the many, not the few."
The last quarter of the twentieth century marked a period of major crisis for Communists in the Soviet Union and the Eastern bloc, where the growing shortages of housing and consumer goods, combined with the lack of individual rights to assembly and speech, began to disillusion more and more Communist party members. With the rapid collapse of Communist party rule in the Soviet Union and Eastern Europe between 1989 and 1991, the Soviet version of socialism has effectively disappeared as a worldwide political force.
Socialism in the 21st Century
In some Latin American countries, socialism has re-emerged in recent years, with an anti-imperialist stance, the rejection of the policies of neo-liberalism and the nationalisation or part nationalisation of oil production, land and other assets. Venezuelan President Hugo Chávez and Bolivian President Evo Morales, for instance, refer to their political programs as socialist. Chávez has coined the term "21st Century socialism" (sometimes translated more literally as "Socialism of the 21st Century"). After winning re-election in December 2006, President Chávez said: "Now more than ever, I am obliged to move Venezuela's path towards socialism."
Socialists on the far left have been prominent in their opposition to war. Protests against the Iraq War have been unprecedented in their scale, often taking place simultaneously around the world. According to the French academic Dominique Reynié, between January 3 and April 12, 2003, 36 million people across the globe took part in almost 3,000 protests against the Iraq war.
Socialists have played a significant role in organising the anti-war protests. On February 15, 2003, millions of people protested, in approximately 800 cities around the world. Listed by the 2004 Guinness Book of Records as the largest protest in human history, protests occurred among others in the United Kingdom, Italy, Spain, Germany, Switzerland, Ireland, the United States, Canada, Australia, South Africa, Syria, India, Russia, South Korea, Japan, and even McMurdo Station in Antarctica. The largest demonstration this day occurred in London, where 2,000,000 protesters gathered in Hyde Park.
Efforts to adapt socialism to new historical circumstances have led to a range of New Left ideas and theories, some of them contained within existing socialist movements and parties, others achieving mobilization and support in the arenas of new social movements. Some socialist parties reacted more flexibly and successfully to these changes than others.
In the developing world, some elected socialist parties and communist parties remain prominent, particularly in India. In China, the Chinese Communist Party has led a transition from the command economy of the Mao period to an economic program they term market socialism or "socialism with Chinese characteristics". Under Deng Xiaoping, the leadership of China embarked upon a program of market-based reform that was more sweeping than had been Soviet leader Mikhail Gorbachev's perestroika program of the late 1980s. Deng's program, however, largely maintained state ownership rights over land, state or cooperative ownership of much of the heavy industrial and manufacturing sectors and state influence in the banking and financial sectors. In South Africa the ANC abandoned its partial socialist allegiances on taking power and followed a standard neo-liberal route. But from 2005 through to 2007 the country was wracked by many thousands of protests from poor communities. One of these gave rise to a mass movement of shack dwellers, Abahlali baseMjondolo that, despite major police suppression, continues to advocate for popular people's planning and against the marketization of land and housing.
Socialism as an economic system
The term socialism is often used to refer to an economic system characterized by state ownership of the means of production and distribution. In the Soviet Union, state ownership of productive property was combined with central planning. Down to the workplace level, Soviet economic planners decided what goods and services were to be produced, how they were to be produced, in what quantities, and at what prices they were to be sold (see economy of the Soviet Union). Soviet economic planning was promoted as an alternative to allowing prices and production to be determined by the market through supply and demand. Especially during the Great Depression, many socialists considered Soviet-style planning a remedy to what they saw as the inherent flaws of capitalism, such as monopolies, business cycles, unemployment, vast inequalities in the distribution of wealth, and the exploitation of workers.
In the West, liberal economists such as Friedrich Hayek and Milton Friedman argued that socialist planned economies were doomed to failure. They asserted that central planners could never match the overall information inherent in the decision-making throughout a market economy (see economic calculation problem). Nor could enterprise managers in Soviet-style socialist economies match the motivation of private profit-driven entrepreneurs in a market economy.
Following the stagnation of the Soviet economy in the 1970s and 1980s, many socialists have begun to accept some of this critique. Polish economist Oskar Lange, for example, was an early proponent of "market socialism." He proposed a Central Planning Board that sets the prices of producer goods and controls the overall level of investment in the economy. The prices of producer goods would be determined through trial and error. The prices of consumer goods would be determined by supply and demand, with the supply coming from state-owned firms that would set their prices equal to the marginal cost, as in perfectly competitive markets. The Central Planning Board would distribute a "social dividend" to ensure reasonable income equality.
In western Europe, particularly in the period after World War II, many socialist parties in government implemented what became known as mixed economies. These governments nationalised major and economically vital industries while permitting a free market to continue in the rest. These were most often monopolistic or infrastructural industries like mail, railways, power and other utilities. In some instances a number of small, competing and often relatively poorly financed companies in the same sector were nationalised to form one government monopoly for the purpose of competent management, of economic rescue (in the UK, British Leyland, Rolls Royce), or of competing on the world market. Typically, this was achieved through compulsory purchase of the industry (i.e. with compensation). For example in the UK the nationalization of the coal mines in 1947 created a coal board charged with running the coal industry commercially so as to be able to meet the interest payable on the bonds which the former mine owners' shares had been converted into.
These nationalised industries would frequently be combined with Keynsian economics and incomes policies to try and guide the whole economy. Nevertheless, most economists, and many socialists, consider that these economies were (or are) capitalist economies, and the asperations of those who believed the mixed economy would abolish boom and slump, mass unemployment, and industrial unrest, were disappointed with the onset of the first world wide recession of 1973-4, the oil crisis of this period, and the monetary instability which followed. Some far left socialists, as well as some workers in the nationalised industries, also criticised the nationalisations for not estabilshing workers' control of the nationalised industries, through elected representatives, and the amount of compensation paid to the previous owners.
Some socialists propose various decentralized, worker-managed economic systems. One such system is the "cooperative economy," a largely free market economy in which workers manage the firms and democratically determine remuneration levels and labor divisions. Productive resources would be legally owned by the cooperative and rented to the workers, who would enjoy usufruct rights. Another, more recent, variant is "participatory economics," wherein the economy is planned by decentralized councils of workers and consumers. Workers would be remunerated solely according to effort and sacrifice, so that those engaged in dangerous, uncomfortable, and strenuous work would receive the highest incomes and could thereby work less.
Socialism and social and political theory
Marxist and non-Marxist social theorists have both generally agreed that socialism, as a doctrine, developed as a reaction to the rise of modern industrial capitalism, but differ sharply on the exact nature of the relationship. Émile Durkheim saw socialism as rooted in the desire simply to bring the state closer to the realm of individual activity as a response to the growing anomie of capitalist society. Max Weber saw in socialism an acceleration of the process of rationalization commenced under capitalism. Weber was a critic of socialism who warned that putting the economy under the total bureaucratic control of the state would not result in liberation but an 'iron cage of future bondage.'
Socialist intellectuals continued to retain considerable influence on European philosophy in the mid-20th century. Herbert Marcuse's 1955 Eros and Civilization was an explicit attempt to merge Marxism with Freudianism. Structuralism, widely influential in mid-20th century French academic circles, emerged as a model of the social sciences that influenced the 1960s and 1970s socialist New Left.
Criticisms of socialism
Criticisms of socialism range from disagreements over the efficiency of socialist economic and political models to condemnation of states described by themselves or others as "socialist." Many economic liberals, such as Friedrich Hayek in his book The Road to Serfdom, argue that the social control over distribution of wealth and private property advocated by socialists cannot be achieved without reduced prosperity for the general populace and a loss of political and economic freedoms. There is much focus on the economic performance and human rights records of Communist states, although some proponents of socialism reject the categorization of such states as socialist. Socialism has also been criticized for slowly evolving into a totalitarian regime when people begin to defect from supporting it. However Socialists have long argued that capitalism has an inherent tendency to turn into a dictatorship. The UK Labour Party, for instance, in 1943 just before it came to power, argued: "But the rise of Hitler and the methods by which he seeks to maintain and expand his power are deeply rooted in the economic and social system of Europe."
Some argue that massive amounts of government protection against globalization by an isolated socialist government would strongly decrease productivity and create worse quality products at higher prices thus leading to a higher impoverishment rate rather than a lower one. Some socialists, including many Marxists, argue that this shows that socialism cannot, therefore, be build in one country, but must be international. In addition, many socialists strongly criticise globalization as a form of "neo-colonialism" through the IMF, World Bank and other institutions, backed up by the threat of invasion, destabilisation or actual invasion from allied powers, mainly the United States, and whose main effect, socialists argue, is to impoverish the people. Historically, socialists have criticized both tariffs which penalize, and subsidies which encourage foreign trade. Socialists, particularly in Europe, term the World Bank and the IMF, together with governments such as the USA and the UK, 'neoliberal', and argue that contrary to claims of pursuing free market policies, government subsidies persist in support of western goods and primary products, such as in the USA and the EU in farming, as well as shipping, while subsidies are condemned by the IMF and World Bank in the neo-colonial world where they exist, as a barrier to free trade, and are often removed with, according to socialists, often disastrous consequences for the population and the local economy. However, to say that policies that interfere with free trade are "neoliberal," is inconsistent with the definition of neoliberalism, which is a philosophy of non-interference with free trade.
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