What We Don’t Know About Socialism Can Hurt Us
There is much confusion over what the term socialism means. To Americans who lived during the Cold War, socialism invokes images of the Gulag in Soviet Union, the mass starvation due to Mao’s policies in China, or the rampant poverty and political oppression of Eastern Europe. Younger Americans, those born after 1989, seem to view socialism as a system aimed at alleviating social injustices. They want more government control of the economy and more wealth redistribution to address both historical and societal injustice. As such, they have uncoupled socialism from its history and redefined it as a more intense form of welfare capitalism (which has been around since at least the New Deal). As a result, we all seem to be talking past one another and thus incapable of understanding what we are actually debating.
Words matter. Definitions matter. And most importantly, historical experience and context matters. If we want to change society, we must have some concept about what needs to be jettisoned, what needs to be reformed, and what is essential and must be kept. Without history such an endeavor is impossible. And yet the political conversation today is removed from that historical reality.
First, I think it is imperative that I explain what I mean by the term capitalism. Capitalism is a cultural and economic system that emerged in the late 18th and early 19th century in opposition to mercantilism, which was the dominant economic system of the time. Capitalism emphasized free trade, denounced protectionism, and depended on a set of liberal institutions – including the courts – to protect individuals’ rights to free speech, due process, and, perhaps most importantly, private property. Culturally, capitalism destabilized the hierarchical social structures of the 18th century and replaced them with an egalitarianism that granted dignity to men and, eventually, women who engaged in market-based transactions. Market engagement began to lose its stigma. The goal of the entrepreneurially-minded would no longer be to become a landed aristocrat who could wash his hands of commerce; rather, commerce became dignified.
The incentive structures of western societies changed quite drastically. Entrepreneurship was directed toward new, more productive professions. Technological innovation emerged in response to the incentives created by the capitalist economic, social, and cultural system. Western Europe underwent rapid industrialization, experiencing both population and productivity booms that ultimately allowed urban workers to not only live but to also to thrive. However, as new cities, like Manchester in England, were created, the problems of industrialization also emerged: overcrowding, poor sanitation, and the loss of worker dignity as they moved from skilled artisanal labor to unskilled factory labor.