What Is Socialism?

What is socialism?

Oh, we all know the answer to that one. Socialism is whatever Barack Obama is doing to America, right?

Well, no. The real definition of socialism is quite different.

Wikipedia says:
Socialism is an economic system characterized by social ownership of the means of production and co-operative management of the economy, and a political philosophy advocating such a system.

Dictionary.com says:
1.) a theory or system of social organization that advocates the vesting of the ownership and control of the means of production and distribution, of capital, land, etc., in the community as a whole. 2.) procedure or practice in accordance with this theory.

And Merriam-Webster says:
1.) any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods.

So the definition is fairly straight-forward. Socialism is what you call it when the government owns and runs the farm, factory or store. Simple. It might also be a smaller collective management system of some sort, such as a cooperative company (a “co-op,” such as Woodman’s Groceries) or a religious movement where its members forfeit all their earthly possessions to be managed by religious leaders (such as pre-Constantine Christianity. Yep. Jesus-Freaks were the first socialists! Read the book of Acts).

But let’s concern ourselves only with socialism as applied by government. Sometimes, a government is socialist outright, controlling the means of production centrally. We’ll call that classic socialism. Other times, government might act a little socialistic in controlling certain things in a limited way, but leaves the overall capitalistic structure alone. We see this more in Europe than in the U.S., but since all capitalism has done this to some degree or another, we’ll call that classic capitalism. Finally, we’ll compare this with government letting needed services die, or outright giving the store away to wealthy interests. We’ll call this crony capitalism.

We can all agree, classic capitalism is a good thing. Those semi-socialistic elements are what gives us roads and bridges. They're what built Hoover Dam and the Tennessee Valley Authority. They gave us U.S. highways. They created the Alaska pipeline. (By the way, if you're wealthy, "you didn't build that!") They're what provides us with military protection. (Say what you will about the military, but it is totally government controlled, no matter what else you may call it.) So classic capitalism = good. Classic socialism and crony capitalism = bad. With me?

So, according to these definitions:

Only one business exists, which is the government: Classic Socialism.
Many businesses, small and large, exist, with the largest paying higher tax rates: Classic Capitalism.
Government defines “small business” as having employees with high six-figure salaries but under 500 employees in the entity, thus allowing them to duck a higher tax rate: Crony Capitalism.

All revenues are government revenues: Classic Socialism.
Government taxes those who aren't poor a little bit, and taxes progressively more as people get wealthier: Classic Capitalism.
Government taxes the middle class at a higher percentage rate than the extremely rich: Crony Capitalism.

Government owns and runs all hospitals, compensating all doctors with pre-set allotments: Classic Socialism.
Government centrally pays for healthcare, with doctors, hospitals and other medical services existing as free enterprises: Classic Capitalism. (Technically, this is referred to as a monopsony, the opposite of a monopoly.)
Government requires citizens to buy insurance or else pay a penalty fee: Crony Capitalism. (Unbelievably so!)

Government takes over a major industry: Classic Socialism.
Government rescues a major industry, like General Motors, buy buying up a major interest and then selling that ownership interest off later when the industry has gotten back on its feet: Classic Capitalism.
Government lets a major industry die so that vultures can swoop in and sell it off in pieces: Crony Capitalism.

All business profits go to the government bank: Classic Socialism.
Taxing the rich at a higher rate is applied as a reasonable counterbalance to the luck and privilege which got them there, allowing greater equality of opportunity and a more sustainable economy: Classic Capitalism.
Taxing the rich at a higher rate is decried as “punishing the successful”: Crony Capitalism.

Catch my drift? Something can be socialistic without necessarily being socialism outright, and capitalism is still capitalism, even if it has a few socialistic elements, provided that the bulk of the economy, particularly wages and prices, remains free-market.

But socialism applied as a nation’s overall government structure (that is, Communism) is all but dead, and has been since 1991. That experiment was tried, and it failed. Want to hear a fact that will make you feel really old? The babies that were born after the Berlin Wall came down are now over 21 years of age! The only communist hold-outs that are left are China, North Korea, Cuba, and a couple of insignificant nuisances, such as Laos, Cambodia, and Myanmar (Burma). China is not a true socialist country because it tolerates capitalism within it as a primary economic structure. So does Cuba. Baby Boomers and all who came after were taught to demonize communism and all its variants from a very young age, despite not really being taught what it is (because that would be subversive), and besides that, it’s now nearly extinct on top of it all. So socialism is something virtually unknown to two, and now almost three, whole generations!

I guess that explains why so many people have no clue as to what it is.

Giveaways to corporate insurance interests are called “socialist.” Low-interest loans to green-energy start-up businesses are called “socialist.” Even things like gay marriage and abortion are called “socialist!”

No wonder people are confused.

One great example of how people have so thoroughly forgotten the definition of socialism is Thomas Peterffy. You might remember him. He’s the billionaire who spent a huge chunk of his fortune on campaign ads during this most recent election decrying how America is becoming socialist.

“I was born in a socialist country,” he says in the ad. And then proceeds to describe how awful it was, and how he sees America becoming more like it. “Yes, the rich will be poorer, but the poor will also be poorer,” he laments, then effectively pleads with people to please vote Republican.

Well, no. Peterffy is right about socialism making everyone poorer – if applied as a nationwide economic system. But he’s dead wrong when he says that he sees that sort of thing happening in America.

You see, Peterffy hails from Hungary. Fair enough. But America is simply not becoming more like bygone Hungary. It’s becoming more like modern France! Or Germany. Or Holland. Or England, Finland, Norway, Sweden, Spain, Portugal, Ireland, Switzerland, or any other non-socialist, died-in-the-wool capitalistic European nation which was never part of the Soviet Bloc and has been smart enough to pay for its citizens’ healthcare! They also have a fairer tax system, which is really all Peterffy is truly complaining about!

Wrong nation, Peterffy. Wrong goddamned nation.

He came over from Hungary as a young man and eventually made himself a fortune as he became an old man. Good for him! But he’s just plain mistaken, and all his money doesn't make him any less confused. Tax breaks for the wealthy means that a great many other young, ambitious men won't be able to pursue the same path to wealth that he did, because they'll have to pay a higher rate which weighs them down. Talk about kicking down the ladder after you've reached the top!

What this guy, and all his friends, are really pissed about is (gasp!) their capital gains tax rates will go up to the same percentage that the rest of us pay on our meager paychecks! Oh horror, the fairness of it all! But look at how much money that Peterffy and his ilk have paid, funding their own TV ads and contributing pre-bundled millions to the Romney campaign.

Do the math: Add up all the money the rich have paid trying to defeat Obama’s plan to let the Bush tax cuts expire on them. Subtract from this the extra money they would have paid in taxes. The difference is the billions they could have saved, if only they hadn't made such a big stink about it!

It was far, far cheaper just to shut up and deal with it.

Well, they’ll know better next time. So will we. Now that we finally know the definition of socialism, that is.


Eric

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