daily-battery.com: Socialism

Socialism is an economic system in which the means of production are publicly or commonly owned and controlled co-operatively, or a political philosophy advocating such a system. As a form of social organization, socialism is based on co-operative social relations and self-management(SONY VGP-BPS8 battery); relatively equal power-relations and the reduction or elimination of hierarchy in the management of economic and political affairs.

Socialist economies are based upon production for use and the direct allocation of economic inputs to satisfy economic demands and human needs (use value); accounting is based on physical quantities of resources, some physical magnitude, or a direct measure of labor-time(SONY VAIO VGN-FZ Battery). Goods and services for consumption are distributed through markets, and distribution of income is based on the principle of individual merit/individual contribution.

As a political movement, socialism includes a diverse array of political philosophies, ranging from reformism to revolutionary socialism. State socialist currents of socialism advocate for the nationalisation of the means of production, distribution and exchange as a strategy for implementing socialism(SONY VAIO VGN-FZ11S Battery); while social democrats advocate public control of capital within the framework of a market economy. Libertarian socialists and anarchists reject using the state to build socialism, arguing that socialism will, and must, either arise spontaneously or be built from the bottom up utilizing the strategy of dual power. They promote direct worker-ownership of the means of production alternatively through independent syndicates, workplace democracies, or worker cooperatives(SONY vgp-bps9 battery).

Modern socialism originated from an 18th-century intellectual and working class political movement that criticised the effects of industrialisation and private property on society. Utopian socialists such as Robert Owen (1771–1858), tried to found self-sustaining communes by secession from a capitalist society. Henri de Saint Simon (1760–1825), who coined the term socialisme, advocated technocracy and industrial planning.[8] Saint-Simon(sony vgp-bpl9 battery), Friedrich Engels and Karl Marx advocated the creation of a society that allows for the widespread application of modern technology to rationalise economic activity by eliminating the anarchy of capitalist production that results in instability and cyclical crises of overproduction.

Socialists inspired by the Soviet model of economic development, such as Marxist-Leninists(SONY VAIO VGN-FZ32 Battery), have advocated the creation of centrally planned economies directed by a single-party state that owns the means of production. Others, including Yugoslavian, Hungarian, East German and Chinese communist governments in the 1970s and 1980s, instituted various forms of market socialism, combining co-operative and state ownership models with the free market exchange and free price system (but not free prices for the means of production) (SONY VAIO VGN-FZ440N Battery).

Goals

The socialist perspective is generally based on historical materialism and an understanding that human behavior is largely shaped by the social environment. In particular, scientific socialism holds that social mores, values, cultural traits and economic practices are social creations, and are not the property of an immutable natural law(SONY VAIO VGN-FZ280E Battery). The ultimate goal for Marxist socialists is the emancipation of labour from alienating work. Marxists argue that freeing the individual from the necessity of performing alienating work in order to receive goods would allow people to pursue their own interests and develop their own talents without being coerced into performing labour for others. For Marxists, the stage of economic development in which this is possible is contingent upon advances in the productive capabilities of society(SONY VAIO VGN-FZ460E Battery).

Socialists argue that socialism is about bringing human social organization up to the level of current technological capability to fully take advantage of modern technology. They argue that capitalism is either obsolete or approaching obsolescence as a viable system for producing and distributing wealth in an effective manner. Socialists generally argue that capitalism concentrates power and wealth within a small segment of society that controls the means of production and derives its wealth through a system of exploitation(SONY VAIO VGN-FZ190 Battery). This creates a stratified society based on unequal social relations that fails to provide equal opportunities for every individual to maximize their potential, and does not utilise available technology and resources to their maximum potential in the interests of the public, and focuses on satisfying market-induced wants as opposed to human needs. Socialists argue that socialism would allow for wealth to be distributed based on how much one contributes to society, as opposed to how much capital one holds(SONY VAIO VGN-FZ150E Battery).

Socialists hold that capitalism is an illegitimate economic system, since it serves the interests of the wealthy and allows the exploitation of lower classes. As such, they wish to replace it completely or at least make substantial modifications to it, in order to create a more just society that would guarantee a certain basic standard of living. A primary goal of socialism is social equality and a distribution of wealth based on one's contribution to society(SONY VAIO VGN-FZ260E Battery), and an economic arrangement that would serve the interests of society as a whole.

Economics

As an economic system, socialism is structured upon production for use - the direct allocation of resources toward useful production. In some cases, financial calculation is replaced with calculation-in-natura - such as energy accounting or physical quantities. The output generated - goods and services for consumption - is distributed through markets(SONY VAIO VGN-FZ140E Battery).

This is contrasted with capitalism, where production is carried out for profit, and thus based upon indirect allocation. In an ideal capitalism based on perfect competition, competitive pressures compel business enterprises to respond to the needs of consumers, so that the pursuit of profit approximates production for use through an indirect process.

Market socialism retains the process of capital accumulation(SONY VAIO VGN-FZ11l Battery), but subjects investment to social control, utilizing the market to allocate the factors of production. The profit generated by publicly owned firms would fund a social dividend, which would be used for public investment or public finance. Market socialist theories range from libertarian theories like mutualism, to theories based on Neoclassical economics like the Lange Model(SONY VAIO VGN-FZ11z Battery).

The ownership of the means of production can be based on direct ownership by the users of the productive property through worker cooperative; or commonly owned by all of society with management and control delegated to those who operate/use the means of production; or public ownership by a state apparatus. Public ownership may refer to the creation of state-owned enterprises(SONY VAIO VGN-FZ11m Battery), nationalisation or municipalisation. The fundamental feature of a socialist economy is that publicly owned, worker-run institutions produce goods and services in at least the commanding heights of the economy.

Management and control over the activities of enterprises is based on self-management and self-governance, with equal power-relations in the workplace to maximize occupational autonomy. A socialist form of organization would eliminate controlling hierarchies so that only a hierarchy based on technical knowledge in the workplace remains(SONY VAIO VGN-FZ18m Battery). Every member would have decision-making power in the firm and would be able to participate in establishing its overall policy objectives. The policies/goals would be carried out by the technical specialists that form the coordinating hierarchy of the firm, who would establish plans or directives for the work community to accomplish these goals(SONY VAIO VGN-FZ21m Battery).

Planned economy

A planned economy combines public ownership of the means of production with centralised state planning. This model is usually associated with the centralised Soviet-style command economy. In a centrally planned economy, decisions regarding the quantity of goods and services to be produced are planned in advance by a planning agency. This type of economic system was often combined with a single-party political system, and is thus associated with the Communist states of the 20th century(SONY VAIO VGN-FZ410 Battery).

In the economy of the Soviet Union, state ownership of the means of production was combined with central planning, in relation to which goods and services were to be provided, how they were to be produced, the quantities, and the sale prices. Soviet economic planning was an alternative to allowing the market (supply and demand) to determine prices for producer and consumer goods(SONY VAIO VGN-FZ21 Battery). The Soviet economy utilized material balance accounting in order to balance the supply of available inputs with output targets, although this never totally replaced financial accounting. Although the Soviet economy was nominally a centrally-planned economy, in practice the plan was formulated on-the-go as information was collected and relayed from enterprises to planning ministries(SONY VAIO VGN-FZ160 Battery).

Socialist economists and political theorists have criticised the notion that the Soviet-style planned economies were socialist economies. They argue that the Soviet economy was structured upon the accumulation of capital and the extraction of surplus value from the working class by the planning agency in order to reinvest this surplus in new production - or to distribute to managers and senior officials(SONY VAIO VGN-FZ210CE Battery), indicating the Soviet Union (and other Soviet-style economies) were state capitalist economies. Other socialists have focused on the lack of self-management, the existence of financial calculation and a bureaucratic elite based on hierarchical and centralized powers of authority in the Soviet model, leading them to conclude that they were not socialist but either bureaucratic collectivism, state capitalism or deformed workers' states(SONY VAIO VGN-FZ38M Battery).

Self-managed economy

A self-managed, decentralized planned economy, is based upon autonomous self-regulating economic actors and a decentralized mechanism of allocation and decision-making. Historically, this manifested itself in proposals for worker-cooperatives and bottom-up planning through workplace democracy. A degree of self-management was practiced in the economic system of the Socialist Federal Republic of Yugoslavia(SONY VAIO VGN-FZ31z Battery), which contrasts to the centralized planning of enterprises in Soviet-style planned economies.

One such system is the cooperative economy, a largely free market economy in which workers manage the firms and democratically determine remuneration levels and labour divisions. Productive resources would be legally owned by the cooperative and rented to the workers, who would enjoy usufruct rights(Sony Vaio VGN-FZ31S battery).

Another form of decentralized planning is the use of cybernetics, or the use of computers to manage the allocation of economic inputs. The socialist-run government of Salvador Allende in Chile experimented with project cybersyn, a real-time information bridge between the government, state enterprises and consumers(SONY VAIO VGN-FZ31E Battery).

Another, more recent, variant is participatory economics, wherein the economy is planned by decentralised 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(SONY VAIO VGN-FZ31J Battery).

A contemporary model for a self-managed, non-market socialism is Pat Devine's model of negotiated coordination. Negotiated coordination is based upon social ownership by those affected by the use of the assets involved, with decisions made by those at the most localized level of production(SONY VAIO VGN-FZ31M Battery).

Michel Bauwens identifies the emergence of the open software movement and peer-to-peer production as a new, alternative mode of production to the capitalist economy and centrally-planned economy that is based on collaborative self-management, common ownership of resources, and the production of use-values through the free cooperation of producers who have access to distributed capital(SONY VAIO VGN-FZ31B Battery).

Anarchist communism is a theory of anarchism which advocates the abolition of the state, private property, and capitalism in favor of common ownership of the means of production, direct democracy and a horizontal network of voluntary associations and workers' councils with production and consumption based on the guiding principle: "from each according to his ability, to each according to his need"(HP PAVILION DV6000 battery).

De-centralized planning is associated with the political movements of social anarchism, anarcho-communism, Trotskyism, council communism, left communism and democratic socialism.

State-directed economy

A state-directed economy is a system where either the state or worker cooperatives own the means of production, but economic activity is directed to some degree by a government agency or planning ministry through coordinating mechanisms such as indicative planning and dirigisme(SONY VGP-BPS13 Battery). This differs from a centralised planned economy (or a command economy) in that micro-economic decision making, such as quantity to be produced and output requirements, are left to managers and workers in the state and cooperative enterprises rather than being mandated by a comprehensive economic plan from a centralised planning board. However, the state will plan long-term strategic investment and seek to coordinate at least some aspects of production(SONY VGP-BPS13B/B Battery). It is possible for a state-directed economy to have elements of both a market and planned economy. For example, investment decisions may be semi-planned by the state, but decisions regarding production may be determined by the market mechanism.

State-directed socialism can also refer to technocratic socialism; economic systems that rely on technocratic management over the means of production and economic policy.

In western Europe, particularly in the period after World War II(ASUS EEE PC battery), many socialist and social democratic parties in government implemented what became known as mixed economies, some of which included a degree of state-directed economic activity. In the biography of the 1945 UK Labour Party Prime Minister Clement Attlee, Francis Beckett states: "the government... wanted what would become known as a mixed economy". Beckett also states that "Everyone called the 1945 government 'socialist'(ASUS EEE PC900 battery)." 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(Dell INSPIRON 1525 battery), of economic rescue (in the UK, British Leyland, Rolls-Royce), or of competing on the world market.

Nationalisation in the UK was achieved through compulsory purchase of the industry (i.e. with compensation). British Aerospace was a combination of major aircraft companies British Aircraft Corporation, Hawker Siddeley and others. British Shipbuilders was a combination of the major shipbuilding companies including Cammell Laird(Dell INSPIRON E1505 battery), Govan Shipbuilders, Swan Hunter, and Yarrow Shipbuilders; the nationalisation 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.

Market socialism

Market socialism consists of publicly owned or cooperatively owned enterprises operating in a market economy(Dell INSPIRON 1420 battery). It is a system that utilizes the market and monetary prices for the allocation and accounting of the means of production, thereby retaining the process of capital accumulation. The profit generated would be used to directly remunerate employees or finance public institutions. In state-oriented forms of market socialism, in which state enterprises attempt to maximise profit, the profits can be used to fund government programs and services through a social dividend(Dell INSPIRON 1520 battery), eliminating or greatly diminishing the need for various forms of taxation that exist in capitalist systems. Yugoslavia implemented a market socialist economy based on cooperatives and worker self-management.

The current economic system in China is formally titled Socialist market economy with Chinese characteristics. It combines a large state sector that comprises the 'commanding heights' of the economy(Dell INSPIRON 1464 battery), which are guaranteed their public ownership status by law, with a private sector mainly engaged in commodity production and light industry responsible from anywhere between 33% (People's Daily Online 2005) to over 70% of GDP generated in 2005. However by 2005 these market-oriented reforms, including privatization, virtually halted and were partially reversed. The current Chinese economy consists of 150 corporatized state enterprises that report directly to China's central government(Dell INSPIRON 1564 battery). By 2008, these state-owned corporations had become increasingly dynamic and generated large increases in revenue for the state, resulting in a state-sector led recovery during the 2009 financial crises while accounting for most of China's economic growth.

The Socialist Republic of Vietnam has adopted a similar model after the Doi Moi economic renovation, but slightly differs from the Chinese model in that the Vietnamese government retains firm control over the state sector and strategic industries, but allows for private-sector activity in commodity production(Dell INSPIRON 1764 battery).

However, the lack of self-management in economic enterprises and the increasing role of privatization suggests that these economies actually represent state capitalism instead of genuine market socialism.

Social theory

Marxist and non-Marxist social theorists agree that socialism developed in reaction to modern industrial capitalism, but disagree on the nature of their relationship. In this context, socialism has been used to refer to a political movement(Dell N3010 Battery), a political philosophy and a hypothetical form of society these movements aim to achieve. As a result, in a political context socialism has come to refer to the strategy (for achieving a socialist society) or policies promoted by socialist organisations and socialist political parties; all of which have no connection to socialism as a socioeconomic system(SONY VGP-BPS13/B Battery).

Marxism

In the most influential of all socialist theories, Karl Marx and Friedrich Engels believed the consciousness of those who earn a wage or salary (the "working class" in the broadest Marxist sense) would be molded by their "conditions" of "wage-slavery", leading to a tendency to seek their freedom or "emancipation" by throwing off the capitalist ownership of society(Sony VAIO VGN-FZ15T Battery). For Marx and Engels, conditions determine consciousness and ending the role of the capitalist class leads eventually to a classless society in which the state would wither away.

Marx wrote: "It is not the consciousness of people that determines their existence, but their social existence that determines their consciousness."

The Marxist conception of socialism is that of a specific historical phase that will displace capitalism and precede communism(Sony VAIO VGN-FZ15G Battery). The major characteristics of socialism (particularly as conceived by Marx and Engels after the Paris Commune of 1871) are that the proletariat will control the means of production through a workers' state erected by the workers in their interests. Economic activity would still be organised through the use of incentive systems and social classes would still exist, but to a lesser and diminishing extent than under capitalism(SONY VGP-BPS13A/S Battery).

For orthodox Marxists, socialism is the lower stage of communism based on the principle of "from each according to his ability, to each according to his contribution" while upper stage communism is based on the principle of "from each according to his ability, to each according to his need"; the upper stage becoming possible only after the socialist stage further develops economic efficiency and the automation of production has led to a superabundance of goods and services(SONY VGP-BPS13AS Battery).

Marx argued that the material productive forces (in industry and commerce) brought into existence by capitalism predicated a cooperative society since production had become a mass social, collective activity of the working class to create commodities but with private ownership (the relations of production or property relations). This conflict between collective effort in large factories and private ownership would bring about a conscious desire in the working class to establish collective ownership commensurate with the collective efforts their daily experience(SONY VGP-BPS13S Battery).

"At a certain stage of development, the material productive forces of society come into conflict with the existing relations of production or – this merely expresses the same thing in legal terms – with the property relations within the framework of which they have operated hitherto. Then begins an era of social revolution. The changes in the economic foundation lead sooner or later to the transformation of the whole immense superstructure(SONY VGP-BPS13B/S Battery)." A socialist society based on democratric cooperation thus arises. Eventually the state, associated with all previous societies which are divided into classes for the purpose of suppressing the oppressed classes, withers away.

By contrast, Émile Durkheim posits that socialism is rooted in the desire to bring the state closer to the realm of individual activity, in countering the anomie of a capitalist society, considering that socialism "simply represented a system in which moral principles discovered by scientific sociology could be applied"(SONY VAIO PCG-5G2L battery). Durkheim could be considered a modern social democrat for advocating social reforms, but rejecting the creation of a socialist society.

Che Guevara sought socialism based on the rural peasantry rather than the urban working class, attempting to inspire the peasants of Bolivia by his own example into a change of consciousness. Guevara said in 1965(SONY VAIO PCG-5G3L battery):

Socialism cannot exist without a change in consciousness resulting in a new fraternal attitude toward humanity, both at an individual level, within the societies where socialism is being built or has been built, and on a world scale, with regard to all peoples suffering from imperialist oppression.

In the middle of the 20th century, socialist intellectuals retained considerable influence in European philosophy. Eros and Civilisation (1955), by Herbert Marcuse, explicitly attempted to merge Marxism with Freudianism(SONY PCGA-BP1N battery). The social science of Marxist structuralism had a significant influence on the socialist New Left in the 1960s and the 1970s.

Utopian versus scientific

The distinction between "utopian" and "scientific socialism" was first explicitly made by Friedrich Engels in Socialism: Utopian and Scientific, which contrasted the "utopian pictures of ideal social conditions" of social reformers with the Marxian concept of scientific socialism. Scientific socialism begins with the examination of social and economic phenomena—the empirical study of real processes in society and history(SONY VAIO PCG-5J1L battery).

For Marxists, the development of capitalism in western Europe provided a material basis for the possibility of bringing about socialism because, according to the Communist Manifesto, "What the bourgeoisie produces above all is its own grave diggers",namely the working class, which must become conscious of the historical objectives set it by society. In Capitalism, Socialism and Democracy(SONY VAIO PCG-5K2L battery), Joseph Schumpeter, an Austrian economist, presents an alternative mechanism of how socialism will come about from a Weberian perspective: the increasing bureaucratisation of society that occurs under capitalism will eventually necessitate state-control to better coordinate economic activity.

Eduard Bernstein revised this theory to suggest that society is inevitably moving toward socialism, bringing in a mechanical and teleological element to Marxism and initiating the concept of evolutionary socialism(SONY VAIO PCG-5L1L battery). Thorstein Veblen saw socialism as an immediate stage in an ongoing evolutionary process in economics that would result from the natural decay of the system of business enterprise; in contrast to Marx, he did not believe it would be the result of political struggle or revolution by the working class and did not believe it to be the ultimate goal of humanity(SONY VAIO PCG-5J2L battery).

Utopian socialists establish a set of ideals or goals and present socialism as an alternative to capitalism, with subjectively better attributes. Examples of this form of socialism include Robert Owen's New Harmony community.

Reform versus revolution

Reformists, such as classical social democrats, believe that a socialist system can be achieved by reforming capitalism. Socialism, in their view, can be reached through the existing political system by electing socialists to political office to implement economic reforms(SONY VAIO PCG-6S2L battery).

Revolutionaries, such as Marxists and Anarchists, believe such methods will fail because the state ultimately acts in the interests of capitalist business interests, and a socialist party will either be subsumed by the capitalist system or find itself unable to implement fundamental reforms. They believe that spontaneous revolution is the only means to establish a new socio-economic system(SONY VAIO PCG-6S3L battery). The task of socialist organizations or parties is to educate the masses to build socialist consciousness. They do not necessarily define revolution as a violent insurrection, but instead as a thorough and rapid change.

By contrast, Leninists and Trotskyists advocate the creation of a vanguard party, led by professional revolutionaries, to lead the working class in the conquest of the state. After taking power(SONY VAIO PCG-6V1L battery), Leninists seek to create a socialist state dominated by the revolutionary party, which they see as being essential for laying the foundations for a socialist economy.

Revolutionary Syndicalists argue that revolutionary trade or industrial unions, as opposed to the state or worker councils, are the only means to establish socialism.

Other theorists, such as Joseph Schumpeter, Thorstein Veblen and some of the Utopian socialists, believed that socialism would form naturally and spontaneously without, or with very limited, political action as the capitalist economic system decays into obsolescence(SONY VAIO PCG-6W1L battery).

Socialism from above or below

Socialism from above refers to the viewpoint that reforms or revolutions for socialism will come from, or be led by, higher status members of society who desire a more rational, efficient economic system. Claude Henri de Saint-Simon, and later evolutionary economist Thorstein Veblen, believed that socialism would be the result of innovative engineers(SONY VAIO PCG-7111L battery), scientists and technicians who want to organise society and the economy in a rational fashion, instead of the working-class. Social democracy is often advocated by intellectuals and the middle-class, as well as the working class segments of the population. Socialism from below refers to the position that socialism can only come from, and be led by, popular solidarity and political action from the lower classes, such as the working class and lower-middle class(SONY VAIO PCG-6W3L battery). Proponents of socialism from below — such as syndicalists and orthodox Marxists — often liken socialism from above to elitism and/or Stalinism.

Allocation of resources

Resource allocation is the subject of intense debate between market socialists and proponents of economic planning.

Many socialists advocate de-centralized participatory planning, where economic decision-making is based on self-management and self-governance and a democratic manner from the bottom-up without any directing central authority. Leon Trotsky held the view that central planners(SONY VAIO PCG-7113L battery), regardless of their intellectual capacity, operated without the input and participation of the millions of people who participate in the economy and understand/respond to local economic conditions; such central planners would be unable to effectively coordinate all economic activity.

On the other hand, Leninists and some State socialists advocate directive planning where directives are passed down from higher planning authorities to enterprise managers, who in turn give orders to workers(SONY VAIO PCG-7133L battery).

Equality of opportunity versus equality of outcome

Main articles: Equality of opportunity and Equality of outcome

Proponents of equality of opportunity advocate a society in which there are equal opportunities and life chances for all individuals to maximise their potentials and attain positions in society. This would be made possible by equal access to the necessities of life. This position is held by technocratic socialists, Marxists and social democrats. Equality of outcome refers to a state where everyone receives equal amounts of rewards and an equal level of power in decision-making(SONY VAIO VGN-FZ150E Battery).