Socialism Means Abolishing the Distinction Between Bosses and Employees
Saturday, 27 June 2015 00:00 By Richard D. Wolff, Truthout | News Analysis
An enterprise only qualifies as "socialist" once the distinction between
employers and employees within it has been abolished. (Image: Jared
Rodriguez / Truthout)
The support of readers like you got this story published - and helps
Truthout stay free from corporate advertising. Can you sustain our work with
a tax-deductible donation today?
Regulated private capitalism. State capitalism. Socialism. These three
systems are entirely different from each other. We need to understand the
differences between them to move beyond today's dysfunctional economies.
With confidence waning in whether modern private capitalism can truly be
fixed, the debate shifts to a choice between two systemic alternatives that
we must learn to keep straight: state capitalism and socialism.
State capitalism exists when the state apparatus - rather than a group of
private citizens - positions state officials to function as capitalist
employers. Thus, under state capitalism it is state officials placed in
charge of enterprises who hire employees, organize and supervise their
activities within enterprises, sell the resulting outputs (goods or
services), receive the sales revenues and thus realize any profits. State
officials occupy the key directorial positions within such state capitalist
enterprises.
In contrast, in private capitalist enterprises, shareholders assign these
positions instead to private individuals - not state officials - within
structures such as corporate boards of directors. Hybrid capitalist
enterprises (part private and part state) also exist. Goods and services
produced in state capitalist enterprises are often sold in markets alongside
those produced by private capitalist enterprises. Likewise, state capitalist
enterprises typically buy their inputs in markets alongside parallel
purchases made by private capitalist businesses.
The Difference Between State Capitalism and Socialism
In all countries today, state capitalist enterprises coexist and transact in
markets with private capitalist enterprises. The proportions of the
different types of capitalist enterprise vary from country to country. Only
in some countries are state capitalist enterprises the socially dominant
kind of enterprise. In the United States, state capitalist enterprises are
definitely not socially dominant, but they do exist: Amtrak, TVA, public
colleges and universities, the post office, the Bank of North Dakota, public
power companies owned and operated by thousands of US municipalities, and
the New York City subway system are all examples. Some state capitalist
enterprises in the US obtain subsidies from the government, but then many
private capitalist enterprises obtain subsidies, too.
The state directly regulates state capitalism. It does this through the
state officials it assigns to direct state enterprise activities. The state
indirectly regulates private capitalism. It does this by means of rules and
laws that limit the enterprise-directing decisions made by private
capitalists.
AN ENTERPRISE ONLY QUALIFIES AS "SOCIALIST" ONCE THE DISTINCTION BETWEEN
EMPLOYERS AND EMPLOYEES WITHIN IT HAS BEEN ABOLISHED.
The fact that the state regulates private capitalist enterprises and
operates state capitalist enterprises does not reduce the capitalist
structure of an economy. So long as employers, private or state, hire
laborers to produce commodities and generate profits that the employers
exclusively receive, the economy has a capitalist structure. So long as it
is exclusively the employers (whether private, state or hybrid; whether more
or less regulated) who decide how to use those profits, it is a capitalist
structure.
An enterprise only qualifies as "socialist" once the distinction between
employers and employees within it has been abolished. When workers
collectively and democratically produce, receive and distribute the profits
their labor generates, the enterprise becomes socialist. Such enterprises
can then become the base of a socialist economy - its micro-level foundation
- supporting whatever ownership system (public and/or private) and
distribution system (planning and/or market) constitute that economy's macro
level.
Actual large-scale socialism would thus predominantly entail worker
cooperative enterprises such as these. Like the capitalist enterprises that
once emerged from European feudalism, these new cooperative enterprises
would seek to solve problems such as how to organize their interdependencies
with one another and with the public, how to relate to private and public
property, and how to manage transitions from smaller- to larger-scale
enterprises. Different forms of societal socialisms will emerge: some with
markets, private property and large corporations, and others with
centralized and/or decentralized planning systems, socialized property,
constraints on enterprise size etc. Debates, experiments and choices among
them will likely characterize the multiple forms that socialism will take.
Previous economic systems likewise often displayed coexistences among more
or less regulated private enterprises and state enterprises. In slave
societies, for example, alongside the private masters of slaves working on
plantations, states often owned and operated slave plantations. In feudal
societies, private feudal manors interacted with the feudal manors operated
by kings, to take a European example. In short, slavery and feudalism, like
capitalism, display varying combinations of private and state enterprises.
Historical Debates Within Socialism
The European socialism that emerged in the19th century was not initially
much concerned with issues of state versus private. It began and evolved -
especially with the work of Marx and his followers - as a systemic critique
of capitalism, not of regulation or the balance between state and private
enterprises. Socialists wanted to go beyond capitalism to an altogether
different system, one that fundamentally rejected the basic division between
employers and employees. Socialists generally favored organizing society as
"classless" where all would be workers who democratically made society's
basic economic and political decisions.
During the 19th century, as the socialist criticism of capitalism grew and
spread globally alongside capitalism itself, socialists debated how to
accomplish the transition from capitalism to socialism. The debate fixed
upon the state as the key means to make that transition. If capitalism's
critics could capture the state, state power could then be utilized for the
subsequent transition to socialism. The state could, under socialists, usher
the new system into being.
A transition to socialistically reorganized enterprises, once accomplished
by a state, would also transform the state as an institution. With
capitalists' power over the state removed, that power would be wielded
instead by the workers controlling the socialized enterprises. Ending
classes would end the need for a repressive state to secure class divisions.
Both Marx's early and important association with the anarchist Mikhail
Bakunin and Lenin's later concept of the "withering away of the state"
shared presumptions that any state apparatus remaining in socialism would
(a) be reduced to coordinating socialized enterprises' interactions, and (b)
depend on workers' socialized enterprises for its resources and powers.
AS SOME PUT IT, SOCIALISM EITHER SHOULD OR COULD ONLY BE ACHIEVED BY MEANS
OF EVOLUTION, NOT REVOLUTION.
Some socialists have believed in and strategized for a revolutionary seizure
of state power from capitalists and their associates. They have sought to
replicate the action of revolutionaries in 1789 France who took state power
from the feudal lords, the feudal king and their associates. Where the
French revolutionary state enabled and facilitated the transition from
feudalism to capitalism, a socialist revolution would proceed similarly for
a transition from capitalism to socialism.
Other socialists have disagreed and argued instead for a
parliamentary/electoral strategy. They have argued that socialists should
form political parties and win elections as the way to capture the state. As
some put it, socialism either should or could only be achieved by means of
evolution, not revolution. As socialism became a powerful global movement,
socialists pursued one or the other or both strategies depending on the
specific conditions in each place and time.
Since 1900, proponents of both strategies claimed some victories. In Western
Europe, socialists built political parties that eventually captured state
power such as socialists in France possess today. In Russia, China and Cuba,
revolutions brought state power to socialists. However, neither socialist
strategy took the next step. Socialists in power could not or would not make
transitions to socialism (and ever since have furiously debated whether that
is what happened and if so, why).
Looking back now, it seems clear that socialists in power moved to economic
systems that mixed state capitalism with more or less regulated private
capitalism. That is, they used state power to construct larger or smaller
state capitalist sectors alongside often heavily regulated private
capitalist sectors. In Western Europe, the state capitalist sectors tended
to be smaller than those in Russia, China and Cuba.
Stalin Spreads Confusion
Shortly after the 1917 Soviet revolution, Lenin described the Bolsheviks'
achievement as having constructed "a state capitalism" that he applauded as
a necessary step toward a transition to socialism. By the early 1930s, the
subsequent leader, Stalin, made a pointedly different declaration: Socialism
had been achieved in the USSR. Yet precisely what Lenin had named state
capitalism remained the Soviet industrial reality; indeed, Stalin extended
state capitalism into Soviet agriculture.
CONCEPTUAL CONFUSIONS SET IN ABOUT WHAT EXACTLY SEPARATED STATE-REGULATED
PRIVATE CAPITALISM FROM STATE CAPITALISM FROM SOCIALISM.
In effect, Stalin had pronounced a new and daring definitional equation:
State capitalism was socialism. Many other socialists, including those who
otherwise denounced Stalin and reviled Stalinism, sooner or later agreed
with this new definition. So too did most of socialism's enemies. In
practice, when socialists achieved state power, they either could not or
would not use that power to go beyond varying mixtures of regulated private
and state capitalism. Yet socialists and their enemies increasingly defined
those mixtures as socialism (although some socialists always disagreed and
promoted other formulations of what the key terms meant). Conceptual
confusions set in about what exactly, if anything, separated state-regulated
private capitalism from state capitalism from socialism.
For most of the last century those confusions proliferated across the
statements of workers, capitalists, politicians, academics, media
personalities and the broad general public. For example, the term
"socialism" was often applied to almost anything done by or through state
power (such as President Obama's Affordable Care Act or the IRS's efforts to
increase tax collection). In much of Europe and beyond, socialism refers
mostly to the broad social welfare results (national health insurance,
pensions etc.) of using government power to regulate, control and tax what
are still largely private capitalisms.
A similar concept of socialism is more or less embraced by US presidential
candidate Bernie Sanders. Thus, he seeks higher mass consumption levels and
better working conditions through state regulatory policies that
redistribute power and wealth from corporations and the rich to the rest of
the society. Yet Sanders' celebration of worker cooperatives suggests some
interest in going further toward a non-capitalist system. Definitions of
socialism in places like China and the USSR specified socially dominant
state capitalist sectors with only marginal allowances for heavily regulated
private capitalism.
The Limitations of State Capitalism and Regulated Private Capitalism
Many socialists struggled and eventually succeeded, often at great costs, to
construct regulated private capitalisms that delivered public services,
wealth and income redistribution, and social welfare far beyond what less
regulated private capitalisms had done. Other socialists went further to
implement state capitalisms that prevailed in their countries. Those could
and often did deliver public services and social welfare beyond what even
worker-friendly regulated private capitalisms did.
Yet socialists in power who presided over combinations of regulated private
capitalisms and state capitalisms suffered two severe limitations. First,
they could not prevent capitalist crises with profound social consequences.
Second, they could not build sufficient confidence in or loyalty to the
systems they constructed to prevent those crises from provoking reversions
from state to private capitalism and from more to less regulated private
capitalism. The capitalist crises of the 1970s thus led to neoliberalism and
the crises of the late 1980s, to the implosions in Eastern Europe. Even the
deep global crisis since 2008 could not stop that reversion as many
socialists and socialist parties embraced austerity policies while failing
seriously to reregulate. Because the mixtures of highly regulated private
and state capitalisms were often run by socialists and called socialism,
their decline over recent decades has been widely and mistakenly understood
as the "end" of socialism.
The workers in state capitalisms that were defined as socialism (the USSR,
China etc.) almost never themselves collectively and democratically directed
state capitalist enterprises. That key function was reserved for state
officials who had replaced the corporate boards of directors. In state
capitalist enterprises, the workers did not have command of and
responsibility for their enterprises' performances. In the aftermath of
their crises, the "actually existing socialisms" of the late 20th century
exhausted the political and historical possibilities of such state
capitalisms.
Similarly, the welfare-state-regulated private capitalisms have shown,
through their periods of neoliberalism since the 1970s and then post-2008
austerity policies, that they were fundamentally insecure and thus
temporary. The New Deal in the US and social democracies in Europe proved
unable to reproduce the political alliances that once forced their states to
enable and facilitate their emergence. They were rolled back in a determined
counterattack by corporations and the rich.
Securing social democratic reforms of the sort won in the 1930s (such as
taxation of corporations and the rich to support mass social services and
jobs) requires much more than mere state regulation of private capitalism.
The forces behind private capitalism mobilized to retake full control of the
state in ways designed to preclude any repeat of New Deal or social
democratic responses to crises. Socialist parties and movements failed to
preserve the New Deal and social democracy, and failed to prevent or destroy
austerity policies after 2008. They thereby exhausted the political appeal
and foundation of socialisms based on state regulation of private capitalism
as utterly as the experiences of the USSR and China largely exhausted the
socialisms based on state capitalism.
Does Socialism Have a Future?
If socialism is to have a future, it will likely have to cut its residual
ties to both state-regulated private capitalism and state capitalism. It
will have to come full circle in the 21st century to rediscover and update
its 19th century differentiation from capitalism as a fundamentally
different mode of organizing the production and distribution of goods and
services.
Self-criticism by socialists must account for the decline of socialist
parties in Western Europe as well as the collapse of state capitalisms
("actually existing socialisms"). Doing so culminates in new definitions of
socialism for the 21st century focused increasingly on democratizing the
workplace - at the micro-level. That is the key change that was missing from
previous socialisms. It must be added to old definitions that were
over-focused on substituting socialized for privately owned means of
production and substituting planning for markets. This is the significance
of the remarkable recent Cuban policy decision to refocus its economic
development strategy relatively more on worker cooperatives and relatively
less on state enterprises. This is likewise the significance of the
remarkable surge of interest in workers' self-directed enterprises among
anti-capitalist social movements and social critics.
Capitalism is relocating from its old centers in Western Europe, North
America and Japan, to new centers in China, India, Brazil and so on. This
relocation is also generating a vast new global criticism of the private
capitalism that proclaimed its absolute victory in the aftermath of the
USSR's implosion in 1989. Workers in the old centers are slowly grasping
that capitalism's relocation will no longer offset their rising exploitation
with rising consumption. They are feeling abandoned by capitalism and
raising increasingly critical voices. They do not want a socialism defined
in terms of Soviet or other state capitalisms that had serious problems and
imploded. They do not want a private capitalism whose regulations proved
reversible and whose qualities of decline they deeply resent. A new
socialism built around democratized workplaces appeals to them in ways old
socialisms no longer can.
Socialism in and for the 21st century must now define itself in clear
distinction from both regulated private capitalism and state capitalism.
Only then can we begin our strategic debates over precisely which socialist
goal to set and pursue.
Copyright, Truthout. May not be reprinted without permission.
RICHARD D. WOLFF
Richard D. Wolff is Professor of Economics Emeritus, University of
Massachusetts, Amherst where he taught economics from 1973 to 2008. He is
currently a Visiting Professor in the Graduate Program in International
Affairs of the New School University, New York City. He also teaches classes
regularly at the Brecht Forum in Manhattan. Earlier he taught economics at
Yale University (1967-1969) and at the City College of the City University
of New York (1969-1973). In 1994, he was a Visiting Professor of Economics
at the University of Paris (France), I (Sorbonne). His work is available at
rdwolff.com and at democracyatwork.info.
RELATED STORIES
Richard D. Wolff | Capitalism's Deeper Problem
By Richard D. Wolff, Moyers & Company | News Analysis and Video
System Change, or There and Back Again: Capitalism, Socialism, Fascism
By Richard D. Wolff, Truthout | News Analysis
Richard D. Wolff | Critics of Capitalism Must Include Its Definition
By Richard D. Wolff, Truthout | News Analysis
________________________________________
Show Comments
Hide Comments
<a href="http://truthout.disqus.com/?url=ref";>View the discussion
thread.</a>
Error! Hyperlink reference not valid.
Socialism Means Abolishing the Distinction Between Bosses and Employees
Saturday, 27 June 2015 00:00 By Richard D. Wolff, Truthout | News Analysis
. font size Error! Hyperlink reference not valid. Error! Hyperlink
reference not valid.Error! Hyperlink reference not valid. Error! Hyperlink
reference not valid.
. An enterprise only qualifies as "socialist" once the distinction
between employers and employees within it has been abolished. (Image: Jared
Rodriguez / Truthout)
. http://truth-out.org/members/donateThe support of readers like you
got this story published - and helps Truthout stay free from corporate
advertising. Can you sustain our work with a tax-deductible donation today?
Regulated private capitalism. State capitalism. Socialism. These three
systems are entirely different from each other. We need to understand the
differences between them to move beyond today's dysfunctional economies.
With confidence waning in whether modern private capitalism can truly be
fixed, the debate shifts to a choice between two systemic alternatives that
we must learn to keep straight: state capitalism and socialism.
State capitalism exists when the state apparatus - rather than a group of
private citizens - positions state officials to function as capitalist
employers. Thus, under state capitalism it is state officials placed in
charge of enterprises who hire employees, organize and supervise their
activities within enterprises, sell the resulting outputs (goods or
services), receive the sales revenues and thus realize any profits. State
officials occupy the key directorial positions within such state capitalist
enterprises.
In contrast, in private capitalist enterprises, shareholders assign these
positions instead to private individuals - not state officials - within
structures such as corporate boards of directors. Hybrid capitalist
enterprises (part private and part state) also exist. Goods and services
produced in state capitalist enterprises are often sold in markets alongside
those produced by private capitalist enterprises. Likewise, state capitalist
enterprises typically buy their inputs in markets alongside parallel
purchases made by private capitalist businesses.
The Difference Between State Capitalism and Socialism
In all countries today, state capitalist enterprises coexist and transact in
markets with private capitalist enterprises. The proportions of the
different types of capitalist enterprise vary from country to country. Only
in some countries are state capitalist enterprises the socially dominant
kind of enterprise. In the United States, state capitalist enterprises are
definitely not socially dominant, but they do exist: Amtrak, TVA, public
colleges and universities, the post office, the Bank of North Dakota, public
power companies owned and operated by thousands of US municipalities, and
the New York City subway system are all examples. Some state capitalist
enterprises in the US obtain subsidies from the government, but then many
private capitalist enterprises obtain subsidies, too.
The state directly regulates state capitalism. It does this through the
state officials it assigns to direct state enterprise activities. The state
indirectly regulates private capitalism. It does this by means of rules and
laws that limit the enterprise-directing decisions made by private
capitalists.
An enterprise only qualifies as "socialist" once the distinction between
employers and employees within it has been abolished.
The fact that the state regulates private capitalist enterprises and
operates state capitalist enterprises does not reduce the capitalist
structure of an economy. So long as employers, private or state, hire
laborers to produce commodities and generate profits that the employers
exclusively receive, the economy has a capitalist structure. So long as it
is exclusively the employers (whether private, state or hybrid; whether more
or less regulated) who decide how to use those profits, it is a capitalist
structure.
An enterprise only qualifies as "socialist" once the distinction between
employers and employees within it has been abolished. When workers
collectively and democratically produce, receive and distribute the profits
their labor generates, the enterprise becomes socialist. Such enterprises
can then become the base of a socialist economy - its micro-level foundation
- supporting whatever ownership system (public and/or private) and
distribution system (planning and/or market) constitute that economy's macro
level.
Actual large-scale socialism would thus predominantly entail worker
cooperative enterprises such as these. Like the capitalist enterprises that
once emerged from European feudalism, these new cooperative enterprises
would seek to solve problems such as how to organize their interdependencies
with one another and with the public, how to relate to private and public
property, and how to manage transitions from smaller- to larger-scale
enterprises. Different forms of societal socialisms will emerge: some with
markets, private property and large corporations, and others with
centralized and/or decentralized planning systems, socialized property,
constraints on enterprise size etc. Debates, experiments and choices among
them will likely characterize the multiple forms that socialism will take.
Previous economic systems likewise often displayed coexistences among more
or less regulated private enterprises and state enterprises. In slave
societies, for example, alongside the private masters of slaves working on
plantations, states often owned and operated slave plantations. In feudal
societies, private feudal manors interacted with the feudal manors operated
by kings, to take a European example. In short, slavery and feudalism, like
capitalism, display varying combinations of private and state enterprises.
Historical Debates Within Socialism
The European socialism that emerged in the19th century was not initially
much concerned with issues of state versus private. It began and evolved -
especially with the work of Marx and his followers - as a systemic critique
of capitalism, not of regulation or the balance between state and private
enterprises. Socialists wanted to go beyond capitalism to an altogether
different system, one that fundamentally rejected the basic division between
employers and employees. Socialists generally favored organizing society as
"classless" where all would be workers who democratically made society's
basic economic and political decisions.
During the 19th century, as the socialist criticism of capitalism grew and
spread globally alongside capitalism itself, socialists debated how to
accomplish the transition from capitalism to socialism. The debate fixed
upon the state as the key means to make that transition. If capitalism's
critics could capture the state, state power could then be utilized for the
subsequent transition to socialism. The state could, under socialists, usher
the new system into being.
A transition to socialistically reorganized enterprises, once accomplished
by a state, would also transform the state as an institution. With
capitalists' power over the state removed, that power would be wielded
instead by the workers controlling the socialized enterprises. Ending
classes would end the need for a repressive state to secure class divisions.
Both Marx's early and important association with the anarchist Mikhail
Bakunin and Lenin's later concept of the "withering away of the state"
shared presumptions that any state apparatus remaining in socialism would
(a) be reduced to coordinating socialized enterprises' interactions, and (b)
depend on workers' socialized enterprises for its resources and powers.
As some put it, socialism either should or could only be achieved by means
of evolution, not revolution.
Some socialists have believed in and strategized for a revolutionary seizure
of state power from capitalists and their associates. They have sought to
replicate the action of revolutionaries in 1789 France who took state power
from the feudal lords, the feudal king and their associates. Where the
French revolutionary state enabled and facilitated the transition from
feudalism to capitalism, a socialist revolution would proceed similarly for
a transition from capitalism to socialism.
Other socialists have disagreed and argued instead for a
parliamentary/electoral strategy. They have argued that socialists should
form political parties and win elections as the way to capture the state. As
some put it, socialism either should or could only be achieved by means of
evolution, not revolution. As socialism became a powerful global movement,
socialists pursued one or the other or both strategies depending on the
specific conditions in each place and time.
Since 1900, proponents of both strategies claimed some victories. In Western
Europe, socialists built political parties that eventually captured state
power such as socialists in France possess today. In Russia, China and Cuba,
revolutions brought state power to socialists. However, neither socialist
strategy took the next step. Socialists in power could not or would not make
transitions to socialism (and ever since have furiously debated whether that
is what happened and if so, why).
Looking back now, it seems clear that socialists in power moved to economic
systems that mixed state capitalism with more or less regulated private
capitalism. That is, they used state power to construct larger or smaller
state capitalist sectors alongside often heavily regulated private
capitalist sectors. In Western Europe, the state capitalist sectors tended
to be smaller than those in Russia, China and Cuba.
Stalin Spreads Confusion
Shortly after the 1917 Soviet revolution, Lenin described the Bolsheviks'
achievement as having constructed "a state capitalism" that he applauded as
a necessary step toward a transition to socialism. By the early 1930s, the
subsequent leader, Stalin, made a pointedly different declaration: Socialism
had been achieved in the USSR. Yet precisely what Lenin had named state
capitalism remained the Soviet industrial reality; indeed, Stalin extended
state capitalism into Soviet agriculture.
Conceptual confusions set in about what exactly separated state-regulated
private capitalism from state capitalism from socialism.
In effect, Stalin had pronounced a new and daring definitional equation:
State capitalism was socialism. Many other socialists, including those who
otherwise denounced Stalin and reviled Stalinism, sooner or later agreed
with this new definition. So too did most of socialism's enemies. In
practice, when socialists achieved state power, they either could not or
would not use that power to go beyond varying mixtures of regulated private
and state capitalism. Yet socialists and their enemies increasingly defined
those mixtures as socialism (although some socialists always disagreed and
promoted other formulations of what the key terms meant). Conceptual
confusions set in about what exactly, if anything, separated state-regulated
private capitalism from state capitalism from socialism.
For most of the last century those confusions proliferated across the
statements of workers, capitalists, politicians, academics, media
personalities and the broad general public. For example, the term
"socialism" was often applied to almost anything done by or through state
power (such as President Obama's Affordable Care Act or the IRS's efforts to
increase tax collection). In much of Europe and beyond, socialism refers
mostly to the broad social welfare results (national health insurance,
pensions etc.) of using government power to regulate, control and tax what
are still largely private capitalisms.
A similar concept of socialism is more or less embraced by US presidential
candidate Bernie Sanders. Thus, he seeks higher mass consumption levels and
better working conditions through state regulatory policies that
redistribute power and wealth from corporations and the rich to the rest of
the society. Yet Sanders' celebration of worker cooperatives suggests some
interest in going further toward a non-capitalist system. Definitions of
socialism in places like China and the USSR specified socially dominant
state capitalist sectors with only marginal allowances for heavily regulated
private capitalism.
The Limitations of State Capitalism and Regulated Private Capitalism
Many socialists struggled and eventually succeeded, often at great costs, to
construct regulated private capitalisms that delivered public services,
wealth and income redistribution, and social welfare far beyond what less
regulated private capitalisms had done. Other socialists went further to
implement state capitalisms that prevailed in their countries. Those could
and often did deliver public services and social welfare beyond what even
worker-friendly regulated private capitalisms did.
Yet socialists in power who presided over combinations of regulated private
capitalisms and state capitalisms suffered two severe limitations. First,
they could not prevent capitalist crises with profound social consequences.
Second, they could not build sufficient confidence in or loyalty to the
systems they constructed to prevent those crises from provoking reversions
from state to private capitalism and from more to less regulated private
capitalism. The capitalist crises of the 1970s thus led to neoliberalism and
the crises of the late 1980s, to the implosions in Eastern Europe. Even the
deep global crisis since 2008 could not stop that reversion as many
socialists and socialist parties embraced austerity policies while failing
seriously to reregulate. Because the mixtures of highly regulated private
and state capitalisms were often run by socialists and called socialism,
their decline over recent decades has been widely and mistakenly understood
as the "end" of socialism.
The workers in state capitalisms that were defined as socialism (the USSR,
China etc.) almost never themselves collectively and democratically directed
state capitalist enterprises. That key function was reserved for state
officials who had replaced the corporate boards of directors. In state
capitalist enterprises, the workers did not have command of and
responsibility for their enterprises' performances. In the aftermath of
their crises, the "actually existing socialisms" of the late 20th century
exhausted the political and historical possibilities of such state
capitalisms.
Similarly, the welfare-state-regulated private capitalisms have shown,
through their periods of neoliberalism since the 1970s and then post-2008
austerity policies, that they were fundamentally insecure and thus
temporary. The New Deal in the US and social democracies in Europe proved
unable to reproduce the political alliances that once forced their states to
enable and facilitate their emergence. They were rolled back in a determined
counterattack by corporations and the rich.
Securing social democratic reforms of the sort won in the 1930s (such as
taxation of corporations and the rich to support mass social services and
jobs) requires much more than mere state regulation of private capitalism.
The forces behind private capitalism mobilized to retake full control of the
state in ways designed to preclude any repeat of New Deal or social
democratic responses to crises. Socialist parties and movements failed to
preserve the New Deal and social democracy, and failed to prevent or destroy
austerity policies after 2008. They thereby exhausted the political appeal
and foundation of socialisms based on state regulation of private capitalism
as utterly as the experiences of the USSR and China largely exhausted the
socialisms based on state capitalism.
Does Socialism Have a Future?
If socialism is to have a future, it will likely have to cut its residual
ties to both state-regulated private capitalism and state capitalism. It
will have to come full circle in the 21st century to rediscover and update
its 19th century differentiation from capitalism as a fundamentally
different mode of organizing the production and distribution of goods and
services.
Self-criticism by socialists must account for the decline of socialist
parties in Western Europe as well as the collapse of state capitalisms
("actually existing socialisms"). Doing so culminates in new definitions of
socialism for the 21st century focused increasingly on democratizing the
workplace - at the micro-level. That is the key change that was missing from
previous socialisms. It must be added to old definitions that were
over-focused on substituting socialized for privately owned means of
production and substituting planning for markets. This is the significance
of the remarkable recent Cuban policy decision to refocus its economic
development strategy relatively more on worker cooperatives and relatively
less on state enterprises. This is likewise the significance of the
remarkable surge of interest in workers' self-directed enterprises among
anti-capitalist social movements and social critics.
Capitalism is relocating from its old centers in Western Europe, North
America and Japan, to new centers in China, India, Brazil and so on. This
relocation is also generating a vast new global criticism of the private
capitalism that proclaimed its absolute victory in the aftermath of the
USSR's implosion in 1989. Workers in the old centers are slowly grasping
that capitalism's relocation will no longer offset their rising exploitation
with rising consumption. They are feeling abandoned by capitalism and
raising increasingly critical voices. They do not want a socialism defined
in terms of Soviet or other state capitalisms that had serious problems and
imploded. They do not want a private capitalism whose regulations proved
reversible and whose qualities of decline they deeply resent. A new
socialism built around democratized workplaces appeals to them in ways old
socialisms no longer can.
Socialism in and for the 21st century must now define itself in clear
distinction from both regulated private capitalism and state capitalism.
Only then can we begin our strategic debates over precisely which socialist
goal to set and pursue.
Copyright, Truthout. May not be reprinted without permission.
Richard D. Wolff
Richard D. Wolff is Professor of Economics Emeritus, University of
Massachusetts, Amherst where he taught economics from 1973 to 2008. He is
currently a Visiting Professor in the Graduate Program in International
Affairs of the New School University, New York City. He also teaches classes
regularly at the Brecht Forum in Manhattan. Earlier he taught economics at
Yale University (1967-1969) and at the City College of the City University
of New York (1969-1973). In 1994, he was a Visiting Professor of Economics
at the University of Paris (France), I (Sorbonne). His work is available at
rdwolff.com and at democracyatwork.info.
Related Stories
Richard D. Wolff | Capitalism's Deeper Problem
By Richard D. Wolff, Moyers & Company | News Analysis and VideoSystem
Change, or There and Back Again: Capitalism, Socialism, Fascism
By Richard D. Wolff, Truthout | News AnalysisRichard D. Wolff | Critics of
Capitalism Must Include Its Definition
By Richard D. Wolff, Truthout | News Analysis
Show Comments
