Socialism
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claim that its demise simply reflects the manifest superiority of capitalism over socialism as an economic model. In this view, capitalism is a uniquely effective means of generating wealth, and thereby delivering prosperity. This is because it is based on a market mechanism that ensures unrivalled efficiency by drawing resources to their most profitable use. In this light, socialism’s key flaw is that, by relying on the state to manage economic life, whether through a system of comprehensive planning or a mixed economy, it constrains the workings of the market. Any group of planners or officials, however dedicated and well-trained, are certain to be overwhelmed by the sheer complexity of a modern economy. These drawbacks have always been the case, but they became particularly apparent with the advent of globalization from the 1980s onwards. Time, in a sense, had caught up with socialism. Globalization widened the gulf between capitalism and socialism. While capitalism benefited from freer trade, new investment opportunities and sharpened competition in a globalized economy, socialism suffered from the fact that globalization further restricted the scope for economic management at a national level. Socialism’s prospects may not be so gloomy, however. Hopes for the survival of socialism rest largely on the enduring, and perhaps intrinsic, imperfections of the capitalist system. As Ralph Miliband (1995) put it, ‘the notion that capitalism has been thoroughly transformed and represents the best that humankind can ever hope to achieve is a dreadful slur on the human race’. In that sense, socialism is destined to survive, if only because it serves as a reminder that human development extends beyond market individualism. Moreover, globalization may bring opportunities for socialism as well as challenges. Just as capitalism has been transformed by the growing significance of the supranational dimension of economic life, socialism may be in the process of being transformed into a critique of global exploitation and inequality. Lastly, urgency has been injected into the revival of socialism by the steady growth, over at least four decades, of within-country inequality. Unless this trend can be effectively challenged, it creates the prospect of deepening social divisions and increasingly acute political dysfunction.
QUESTIONS FOR DISCUSSION
y y What is distinctive about the socialist view of equality? y y Why do socialists favour collectivism, and how have they tried to promote it? y y Is class politics an essential feature of socialism? y y What are the implications of trying to achieve socialism through revolutionary means? y y How persuasive is the socialist critique of private property? y y What are the implications of trying to achieve socialism through democratic means?
y y On what grounds have Marxists predicted the inevitable collapse of capitalism? y y How closely did orthodox communism reflect the classical idea of Marx? y y To what extent is socialism defined by a rejection of capitalism? y y Is social democracy really a form of socialism? y y Is the social-democratic ‘compromise’ inherently unstable? y y Can there be a ‘third way’ between capitalism and socialism?
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