We live in an insane world. Today we see, more than ever, incalculable wealth standing opposed to unspeakable misery. Millions die of curable or preventable diseases while the United States government wastes hundreds of billions of dollars on arms production. Half the world’s working population makes $2 a day or less. In the US there has been a 20 percent fall in living standards for 80 percent of the population since 1973, with one third of the work force stuck in temp and part-time jobs as the eight-hour workday becomes a thing of the past, and a predominantly Black and Latino prison population which may hit 5 million by the year 2010. The gap between what could be accomplished with the talents of the world’s population and what actually happens is wider than ever.
Our world is one where people exist for the sake of the economy and not, as it should be, the other way around. This insane world is, above all, a capitalist world.
Capitalism doesn’t simply mean the private ownership of corporate property — “the means of production,” as socialists often say. Capitalism is an economic system based on the dominance of production-for-profit. In such a system the individual, privately owned enterprise represents nothing other than a particular interest. It acts as if it were the center of the universe. It lays hold of as much means of production and raw materials as it can, and employs as many workers as its resources and its sales prospects enable it to, without asking itself if these resources and this labor power might not be more useful in another field of activity. It produces as much of its particular commodity as it can dispose of on the market, without asking itself if other goods might not be more useful for society. And it is even prepared to attempt to wage a “psychological war” against the whole population through advertising, in order to convince people that they have a need for a particular commodity. The logic of capitalism is to turn everything into a commodity, into something that exists only to make a profit.
The capitalist class, which consists of the primary owners, executives and financiers of capitalist firms, appropriates the surplus of the value created by those who have to sell their labor power in order to survive — that is, the majority of the population, which is what socialists are talking about when we use the term “working class.” (If you have to work for a boss, and you have no decision-making power over others, then you’re in the working class.) This asymmetry of power means that even if capitalists paid workers a “living wage,” the value of that wage will always be less than the value of the commodities produced by the workers’ labor, since if capital can’t make a profit it won’t employ workers. Under capitalism, the only “needs” recognized as legitimate are those that appear through market exchange and the ability to pay (“effective demand,” as economists revealingly call it). This is so even if food is exported from famine-stricken areas or houses stand empty because they can’t be sold while thousands of people are homeless. By contrast, a rational need from a socialist standpoint is one related to guaranteeing provision of food, shelter, clothing, and access to recreation and education for all.
The capitalist class is the ruling class, the class with the greatest amount of power, because it’s the class that controls employment and monopolizes economic decision-making. Even when politicians that represent capital aren’t directly controlling the government, all state officials under capitalism are always constrained by the need for business confidence and continued private investment. Hence, reforming capitalism is difficult and it often can’t be done at all without mass political mobilization and social unrest. This structural inequality erodes the promise of political democracy, perhaps nowhere more obviously so than in the United States. Voting under capitalism doesn’t include the right to decide on what corporations should do, whom they employ or who gets the profits.
The inherent irrationality of capitalism, of the dictatorship of market forces, is that the object of economic growth is economic growth itself, not the satisfaction of human needs. Capitalism treats human life itself as a “production cost.” Work, the activity through which humanity appropriates its environment, is a compulsion, opposed to relaxation, to leisure, to “real” life. Production is ruler of the world; when one produces, one sacrifices one’s time during work in order to enjoy life afterwards, in a way usually disconnected from the nature of the work, which is just a means of survival. And even when the whip of the capitalist market is somewhat softened by state regulation, the system remains ruled by impersonal laws that inevitably impose themselves on the will of every individual.
The Socialist Ideal and the Capitalist World
The values of socialism are the exact opposite of those of capitalism: the principle of cooperation replaces that of acquisitive competition. The socialist vision is of a world without social classes, in which all people’s material needs are met and everyone is able to fully develop his or her creative potential. In such a world, the dichotomy between “work” and “leisure” is overcome. People are no longer forced to do the same thing their entire lives. Production is no longer the ruler of society but instead is subservient to society; when all economic and political institutions are democratically controlled, the economy is no longer a separate and privileged field upon which everything else depends. This doesn’t mean that work would become perpetually enjoyable under socialism, or that human beings would become angels, but humanity would finally be able to consciously control its own destiny and the arbitrary use of power would no longer be possible.
Democratic socialism is therefore the heir of the best aspects of classical liberalism. There is nothing wrong with the freedoms that classical liberalism holds dear: the freedoms of association, speech, press, assembly, and so on. The problem is that under capitalism these freedoms are greatly restricted and hollowed out. Liberal freedoms can only be fully secured in a socialist society, where property rights no longer take precedence over political, civil, and social rights.
Socialism is, therefore, not about authoritarian central planning or mere state ownership as existed in Russia, Eastern Europe, or China. It is not about replacing the rule of capitalists with the rule of state bureaucrats. But it does involve replacing the dictatorship of market forces with deliberate, democratic economic coordination. Defenders of capitalism — professional economists, above all — claim that this is technically infeasible, and many people accept their arguments. But there are real precursors and aspects of socialism that exist today, under capitalism.
In Argentina, workers from Buenos Aires have formed worker-managed co-operatives by taking over factories abandoned their former owners. Their success proves that workers don’t need bosses — arbitrary, authoritarian work relations are not necessary.
There are also international “direct trading” networks that develop fair trade links between European consumers and cooperatives of small-scale growers of coffee and cocoa in Africa and Latin America. In such a “socialized market” prices are determined by social objectives instead of commercial ones and non-economic values are prioritized.
Much of the internet now runs on open-source software, written not for profit but for the pure satisfaction of creating a useful product. This anticipates a future in which productive social labor becomes an end in itself. It shows that private corporate property has become a constraint in the development of technology.
A current capitalist goal is an automated shop floor, with functions such as purchasing, stock, and sales in the retail outlets linked electronically to the factory floor. The real problem is its complexity, which is a result of rivalry in profit making and the business secrecy that this requires. If sales could be predicted and planned in advance, then this would be workable — but it requires the end of the business cycle of “booms” and “busts,” which is impossible under capitalism. Despite the fact that companies spend millions in marketing efforts to discover consumer wants and to improve the usability of their products, the real problem is not what consumers want, but what they can afford to buy, and it is this element that is the most unpredictable of all and lies behind the operation of the business cycle. Fixing this problem requires the overcoming of the contradiction between private consumption and collective production.
Evolution and Revolution
A hundred years ago, when socialist parties were becoming enormous and socialism really did seem to be on the historical agenda, there were famous debates about whether it could be accomplished peacefully through the election of socialists to office or if the working class would have to forcibly overthrow the existing capitalist state. The crux of the issue was whether or not the capitalist class would respect its own legal order if the socialist movement became popular enough to actually try to legislate capitalism out of existence. Given capitalist support for Hitler in Germany in the 1930s and Pinochet in Chile in the 1970s, we can be certain of the answer to this question: if capitalists feel sufficiently threatened by the socialist movement, they will throw their support to the fascists and accept limits on their own civil and political rights, if that’s what it takes to save their system.
At the same time, there’s no getting around the fact that the majority of workers in the advanced capitalist countries have simply not been interested in revolutionary socialist politics. Part of this is due to authoritarian Communists calling their states “socialist.” Part of it is due to the predominance of market values in popular culture, especially in the US. Another part is that what socialists call “the working class” is in fact very heterogeneous, not just in sex, race, ethnic identity, sexual orientation, etc., but also in skill and income level (blue collar, white collar, etc.). But it’s also true that in liberal-democratic countries, workers have been able to meet at least some of their needs via the welfare state, thereby creating a situation in which they no longer have, to quote Karl Marx and Frederick Engels in The Communist Manifesto, “nothing to lose but their chains.”
The truth is there is no certain road from existing society to the classless society. But in the past, both moderate socialists (known as social democrats) and revolutionary socialists (who usually called themselves Leninists and Communists, inspired by the Russian Revolution of 1917 led by V.I. Lenin’s Bolshevik Party) were both very optimistic. Social democrats believed in the electoral road to socialism, and most of them came to believe that a reformed, regulated capitalism was the only “socialism” that was both necessary and possible. The economic achievements of social democracy are undeniable. Germany and the
Scandinavian nations, in particular, are probably the most democratic, humane countries in the world, without any real poverty to speak of, with strict health and safety regulations, progressive taxation, and guaranteed health care, child care and housing — all things for which Americans are still fighting. At the same time, social democracy both naively equated electoral victory with radical change and fell into a pragmatism that was overwhelmed by the economic power of capital, particularly the mobility of capital. Social democratic parties have usually been technocratic and purely electoral in their approach to politics, and have had little need for, or interest in (if not active fear of), the development of a militantly class-conscious activist movement. In our age of global capitalist domination, the role of social democracy has been, at best, to blunt the sharpest edges of corporate power.
Leninists argued that there was no road to socialism except through the insurrectionary overthrow of the capitalist state. Lenin shared this conviction with socialists who were consistently both democratic and revolutionary, such as the German socialist leader Rosa Luxemburg. But Lenin took 20th century socialism into an authoritarian direction. Although he vaguely described the replacement of the capitalist state with self-governing workers’ councils in his pamphlet The State and Revolution, in practice, Lenin’s Bolshevik Party rapidly supplanted the councils as the main governing institution in the Soviet Union. Despite his claim to Marxist orthodoxy, Lenin’s belief in the privilege of the “vanguard party” — which can do whatever it wants once it takes power because it represents the “true” interests of the working class — contradicts Marx’s belief in the self-emancipation of the working class. Leninism has generally been very unpopular in democratic capitalist societies, perhaps because self-described Leninist parties are usually thoroughly authoritarian.
Socialist Politics Here and Now
The struggle for the free, classless society is going to take much longer than we would like and that there’s no guarantee that we’ll ever be fully successful in reaching it. Fundamentally changing human consciousness and building alternative institutions takes a great deal of time. The fight against capitalism — and the fight to limit the likelihood of violence in defense of capitalism — will have to take place both inside and outside existing states. The effectiveness of elected socialist politicians ultimately depends on the strength and size of the socialist movement outside the halls of government. Our job right now is work to for reforms of every kind — social, economic, and political — that will exist within capitalism but will work against capitalism and for the majority of people. We can’t expect the tiny US socialist movement to jump from minority to majority status any time soon, and we have to work with people more politically moderate than ourselves to achieve even partial goals. But as radicals we must embrace not only electoral politics but also industrial struggles, strikes, civil disobedience, and direct action.
Given that many workers, particularly in the US, don’t even think of themselves as “working class,” socialists insist on the ideal of class unity in order to distinguish the common interests of people who are otherwise divided into separate interest groups. Sexism, for example, affects women of all classes, but what they can do about it is very much class-related. Similarly, all of humanity currently stands on the precipice of ecological disaster, and if the blind pursuit of economic growth is to be rejected, all classes, including the consumerist working classes of the North, will need to engage in a massive project of income and wealth redistribution to the working classes of the South.
Some may say that socialists should hold on to our ideal and our approach to politics but drop the word “socialism” because of its lingering association with unaccountable state bureaucrats. But the truth is that if you believe in democracy and recognize that wealth is a social creation and therefore should be controlled by all of society, you can use other labels but you are going to get called a socialist anyway. And in the US those who defend capitalism invariably demonize proposals for such reforms as a national health care system or public investment in childcare as “socialist.” Since we are stuck with the S-word, we ought to wear it proudly.
The days in which socialism seemed inevitable are long since gone, and socialism’s appeal has been tarnished by the authoritarian regimes that falsely ruled in its name. For the foreseeable future, socialism may be only an ideal, as we can’t promise that the emancipated society will ever arrive. But the socialist ideal informs our day-to-day politics, our opposition to class domination and the dictatorship of market forces. As the socialist writer Leo Panitch puts it, “as long as we can muster the strategic creativity and imagination to develop alternative political institutions that will in fact be developmental, we are contributing to making socialism possible.”
Jason Schulman is on the editorial board of the journal New Politics and is active in New York City Democratic Socialists of America.