Capitalism Respects the Individual While Socialism Denies that Respect in Favor of the State

Dear Democrats,

I see that, for the first time, a Gallup poll has found that more Democrats prefer socialism than capitalism.  (See https://news.gallup.com/poll/240725/democrats-positive-socialism-capitalism.aspx)

Do you really understand that which you are preferring?

I suspect that everyone is at least somewhat familiar with the former U.S.S.R.  While we liked to refer to it as a communist country, it was indeed socialist.  Is that truly what you are looking for?  And, please don’t tell me that socialism here would be different – it would not.  The people who turned to socialism in the Soviet Union, like many of you, believed that it was for the good of all the people; history shows us how that turned out.

Let’s consider.  Here are the primary characteristics of a socialist economy:

1.      Public Ownership.   Also known as collective ownership, this means that the all forms of production and distribution are owned, controlled and regulated by the state (the government).  The basic motive of the government is not to profit, but rather to meet targeted objectives – objectives that those in power have determined are in some way appropriate.

2.      Planned Economy.  Again, the state will control and plan all economic activities including production, exchange, distribution, and consumption.  Laws of supply and demand do not apply.  The theory is that because the state is solely responsible for the distribution of wealth that society as a whole will prosper.

3.       Classless Society.  Everyone will theoretically have an equal economic status.

4.      State is responsible for basic necessities of life.  The basic needs of life are promised by the state.  These needs include:  food, shelter, clothing, health, education, employment.  The details of each of these needs are again left to the state to determine.

5.       Equal Opportunity.  While there may not be equality of income, the state will guarantee to provide equal opportunity by considering the skills and ability of each individual to determine their success in such a way as to deprive no one of their basic needs.

6.       Non-existence of competition and limited choice of consumer products.  Because the state has full control over production of goods and services there is an absence of competition in the market.  Because the system is focused on life necessities, choice in consumer products will be limited and confined to the essentials.

7.       Pricing Mechanism.  Pricing will be controlled by the state; this includes both market pricing and accounting pricing which underlies decisions about production of consumer and investment goods.

I can understand how this might sound good on first blush.  Words and phrases like “classless society” and “basic needs provided to all” along with a “planned economy” where “society as a whole will prosper”  all sound lovely.   How wonderful that everyone will be provided equally with food, shelter, clothing, health, education, and employment. 

Or, is it really so wonderful?

Let’s look at how those basic necessities were provided in socialist Russia.  I assume you are all aware of the bread lines and the meager existence of the Soviet citizenry.  Three generations of family living in a three room (that’s three total rooms, not three bedrooms) apartment.  Smaller unrelated families required to share living space.  Employment determined by the state.  Education primarily focused on indoctrination to the party ideals.  And, while everyone may have been provided those basic necessities, though in limited quantity and quality, one cannot really argue that the society was classless.  Those in power lived very differently from the masses.

I do think that the idea of socialism is in large part built on compassion.  One sees one’s fellow humans suffering and wanting for the basic necessities while others seem to have more than they could ever need.   One wants to help.  One wants to allow everyone to thrive.  But, consider whether, despite all its glowing rhetoric, socialism is really the best way.

In socialism, it is really the state that thrives.  The individual simply becomes a tool of that state, supporting it and those few that are in power.

Let’s consider how a capitalist economy differs. 

1.        Private Ownership.  Unlike socialism the means of production and distribution are primarily under private control.  Generally, there will be limited taxation and minimal government mandated labor policies as well as those designed to ensure employee safety and protect against unfair hiring practices.

2.       Free Market.  Individuals and businesses compete for profit.  The underlying principle is “survival of the fittest”; that is, those that offer the best products and services for the lowest prices while maintaining a high level of profitability will usually survive.  The free market follows the law of supply and demand and will be responsive to the needs and demands of consumers.

3.       Two classes.  Historically, capitalist economies are split between two classes of individuals:  the capitalist class that owns the means for production and distribution of goods, and the working class who sell their labor to the capitalist class in exchange for wages.

4.       Little or no government interference.  While an ideal capitalist economy would have no government interference, in reality there will be minimal laws and regulations on certain industries.  The government will not usurp the individuals‘ rights and abilities to make their own decisions as to what they need and what they want and as to how best to fulfill those needs and wants.

5.       Power of the individual.  The entire production pattern of capitalism is based on the desires, wishes and demands of the consumer.  Individuals are free to make their own choices as to how to use their skills and what to do with their profits.  Every individual is independent to his means of production in any occupation that one likes.  Self-interest rather than state interest will allow the individual to determine how and how hard to work, and will allow maximum income to be earned based on decisions and demands of individual consumers.

6.       Choice.  Producers and consumers are free to make decisions rather than having decisions made for them by the state.

7.       Willingness to change.  Capitalism has the ability to adapt and change.  The willingness to allow change and the adaptability of societies to improve inefficiencies within economic structures is important as societies evolve and is currently especially important in the area of technology.

Capitalism does not have so many pretty and compassionate sounding phrases as does socialism.  But, let’s go below the surface and consider that ultimately the difference is about the respect that one has for each person’s right to determine his or her own destiny.

In the end, socialism concludes that the individual is incapable of surviving, let alone deciding how to survive, without the state.  It sees the individual as a child who needs the state to act as parent, making all life decisions for the individual. It will feed and cloth the individual as it sees fit, not as the individual might like.  It will provide the care that it determines is appropriate.  It will decide how the individual should spend his or her life, both working and leisure life.  And, in order for the system to work, the state will demand complete loyalty from the individual.  Individual desires, hopes, dreams, aspirations become meaningless as all walk the path determined by the state.

In contrast, Capitalism respects the individual.  Yes, that can have some harsh consequences.  We all make bad decisions from time to time and, sadly, sometimes a bad decision may truly affect the rest of our life.  Sometimes we are placed in situations where we simply cannot make the decision that we would like.  Even in an ideal capitalism where everyone was faced with identical opportunities and abilities, the results of how each individual would handle those opportunities would differ, and ultimately  place some in less than desirable positions.  

Our very noble human compassion wants to stop the hurt that can come with a capitalist economy.  But, socialism is not the answer.  The answer is not to take away our individuality or to demean individuals as incapable of making decisions.  The answer is not to give the individuals’ power to the state.

The answer is to work to improve the existing imperfections of capitalism, not to throw out the proverbial baby with the bath water and dump capitalism for socialism. 

So, dear Democrats, I urge you to turn away from socialism’s seductive siren song.  Instead of being seduced by some power structure that would strip us all of our individual freedoms, listen to all the many individuals and their diverse needs and wants.  Help those individuals to see where changes in our society can strengthen our individual determination and responsibility to make a better world in which the individual, not the state, controls his or her own destiny.  Capitalism, not socialism, provides the democratic economic structure in which this can take place.

Debating Socialism

Recently someone suggested that it was time that this country has a debate about socialism vs. our current form of government.  I think that is fine if – and only if! – those engaged in the conversation really understand what socialism is along with other key concepts about governments and political ideologies.  So, here I will present some of those concepts and then my thoughts for those who want to realistically think about or engage in such a debate.

First, we must understand the difference between political philosophies/theories/ideologies (such as socialism) and forms of government (such as democracy).  A political philosophy will take a particular stance as to law and authority, as to what, if any, rights and freedoms a government should protect and what, if any, responsibilities the citizenry of a defined state owes to the government.    A defined state or nation will have a form of government that may align with one or more political ideologies. 

Government is simply the governing body of a defined community such as a nation or state.  Forms of government include Autocracy, Oligarchy, Democracy.  An autocratic government might be an absolute monarchy or a dictatorship; the key is that the power to govern is held by one person.  In an oligarchy the power will be held by a few people who generally get their power from things like ancestry, wealth/status, or military.  In a democracy the government is ruled by the people who hold the power to govern; a republic is a form of democracy.

The United States is a Democratic Republic which is a form of government operating on principles adopted from and shared by both democracy and republic.  In a pure democracy which is governed by all eligible members, the majority will always prevail.  A republic is a state in which supreme power is held by the people but exercised through their elected representatives, including a president.  A republic will include certain rights that are inalienable (not subject to overrule by the majority) and protected by a document such as a constitution, creating rule by law rather than by pure majority.

Within any form of government, political parties, including that of the controlling power, will align with and adopt one or more political theories or ideologies.  When one political theory becomes dominant within a particular state, that state may be referred to by that theory’s name (e.g. as Socialist or Capitalist).  Following are those political theories and philosophies that are most relevant to this discussion.

Socialism is a theory for a political and economic system of social organization that advocates that the means of production, distribution, and exchange should be owned or regulated by the community as a whole.  That is, it advocates collective or governmental ownership and administration of the means of production and distribution of goods.

This is in contrast to Capitalism that is a theory for an economic and political system in which a country's trade and industry are controlled by private owners for profit, rather than by the state.

Communism's ideology is an economic and political system in which all property is publicly owned; it adheres to the revolutionary socialism and class warfare of Karl Marx.  While both communism and socialism are anti-capitalist, many forms of socialism allow for some private ownership of property. 

According to Wikipedia, “The majority of self-declared Socialist countries have been Marxist–Leninist states, following the model of the Soviet Union or a variant of people's democracy. They share a common definition of ‘socialism’ and they refer to themselves as Socialist states on the road to communism with a leading vanguard party structure. For this reason, they are generally, called ‘Communist states’ albeit erroneously. Meanwhile, the [socialist] countries in the non-Marxist–Leninist category represent a wide variety of different interpretations of the word ‘socialism’. In many cases, they do not define what they mean by it. Modern uses of the term ‘socialism’ are wide in meaning and interpretation.”   Current self-labeled socialist countries are:  China, Cuba, Laos, and Vietnam.

Two sub-categories of Socialism are Social Democracy and Democratic Socialism.  These terms define particular socialist leaning ideologies or policies of various political parties that exist or have majority control in various countries. 

Social Democracy is an ideology that supports economic and social interventions to promote social justice within the framework of a liberal democratic organization and capitalist economy.  One could argue that some of the Nordic countries currently follow social democratic ideologies.

Democratic Socialism (many progressives now identify as democratic socialists) is a political philosophy that advocates political democracy alongside social ownership of the means of production with self or “democratic” management of economic institutions within a market socialist, participatory or decentralized planned economy.  That is, democratic socialism would have the production and provision of certain goods and services owned and run by the government, while leaving others to a more capitalist form of ownership. Wikipedia lists the following countries as currently in the control of a democratic socialist party:  Albania, Bangladesh, Bolivia, Dominica, Equator, El Salvador, Guyana, Jamaica, New Zealand, Nicaragua, Portugal, St. Kitts, Slovakia, South Africa, Spain, Sri Lanka, Tanzania, Trinidad, Uruguay, and Venezuela.

Moving now to the actual debate, I would first suggest that it actually must be more of a discussion than a debate.   A debate presumes there are only two sides or positions on an issue, one of which must ultimately prevail.  A discussion on the other hand allows for more refined distinctions and compromises which the many definitions of socialism alone demand. Moreover, the debate, as presented, requires pitting a form of government (our Democratic Republic) against a political theory (Socialism).  This is not unlike trying to compare apples and oranges.  The better question is not one of socialism vs. a democratic republic, but rather whether socialism can or should be adopted as a viable political theory within a democratic republic that is generally considered as a capitalist nation. 

I believe that, no matter how the question is presented, our democratic republic based on capitalism is so antithetical to socialism that it is impossible to truly have democratic socialism or any other such marriage of socialism into the defining principles of the United States of America.

The basic question comes down to the role of the individual in his own governance as well as the governance of his community.  Socialism, in all its many forms, will have the government making decisions about the individual and his property, including the fruits of his labor; the government will provide what the individual may otherwise be required to or capable of providing for himself.  In so doing, the government, rather than the individual, will make decisions about what the individual may or may not need.  In order to provide government-controlled services to all members of the community, the individual will be required to relinquish some property, individual accomplishment, and profit as well as some personal decision making that he would otherwise retain. 

The upside of this approach is that one can envision a utopia in which everyone has all that they need and want, where everyone is completely altruistic in all that they give to the body politic, and everyone is happy.  This assumes that those making the governmental decisions will always have only the best interests of the people in mind and that all the citizenry will agree as to the definition of what those “best interests” are.

The downside is that such utopia is totally unrealistic.  And, even if it were, even if those in current power were completely concerned with only the good of everyone, they will not be in power forever. Moreover, the definition of what is “good” is unlikely to be defined identically by all and even if it were, it might easily change to the detriment of some or many.  By giving government the power to act in accordance with what sounds and/or is compassionate today sets the stage for tomorrow’s government to use that same power for ill.

This is true regardless of within what form of government a socialist philosophy is placed.  That is, a benevolent dictator can give way to a tyrannical dictatorship, but also a pure democracy with a benevolent majority can give way to a majority that suppresses basic human rights and dignities if that majority holds the socialist power to regulate the community including the individual’s property, production, needs, and wants.

Here is the beauty of a democratic republic based on capitalist principles.  First, the democratic republic follows the rule of law, not of a tyrannical individual or majority.  It grants to its citizens certain inalienable rights; rights that cannot be denied to the individual based on changing whims of government.  Second, capitalism further solidifies the rights (as well as responsibilities) of the individual.  The individual will be accorded certain rights which the law will protect.  It will allow the individual to pursue the use of his assets (both external and physical as  well as innate and intellectual) as he chooses and will not redistribute his profits to others who have chosen to pursue different paths or to use their assets differently.

This does not mean that a capitalist or non-socialist state cannot be compassionate.  Placed within a democratic form of government where rule is by law, the people who hold the power can, through their elected representative government make the choice to collectively assist those who may need some form of assistance.  But, that decision would be made by the people in a way that does not interfere with defined and constitutionally protected inalienable rights; it would not be a decision made at the whim of some other form of governmental power structure.

Socialism is dangerous.  It sounds wonderful in its utopian equality, but what it really does is end up playing one group of citizens against another while promising utopia to all.  Collectives destroy individual incentives and the result is bread lines and misery.  Recent history saw this in the Soviet Union before its fall and even more recently in Greece’s economic crisis.  Current history sees it playing out in Venezuela.  Even in social democracies that may seem to thrive, how “social justice” is defined by the government in power can result in good or ill for one group or another.

Idealism is beautiful, but it is just that – an ideal, an archetypical idea of unattainable perfection.  It is not real.  Reality includes the imperfect, acknowledges it, and tries to make the best of it.  In my opinion, socialism may be a lovely ideal, but it is not something that can exist is our reality.  Our capitalist Democratic Republic is not perfect, but it is very real, and, it is the only form of government that can respect, reward, and fulfill the individual regardless of who is in power at any given moment.

Socialism, in any of its forms or wrappings, is in direct opposition to the core principles of the United States of America; principles that provide the individual with choice and possibility beyond any that can be offered and that are indeed denied by socialism.  It is these core principles that provide hope and motivation rather than hopelessness and despair.  If a debate between this government and replacing or infusing it with socialism is well informed, I do not see how socialism can possibly win.