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Socialism is the idea that humans can live in justice, equality, and freedom in a world in which humanity collectively controls its own fate. Socialists see capitalism as a stage of the development of class society, which contains within it the potential and need to go farther and create a society where human lives are not determined by the whims of the powerful or the economic system. The terms socialism and communism were at one stage used interchangeably. They still are by some. However, the history of socialism in the broadest sense requires an understanding of the differences as well as the links between them.

The first use of the term socialism in English has been traced back to a cooperative magazine in 1827. Many accounts of the history of socialism, however, claim to identify roots that go back to the ancient world. It is true that throughout history men and women have imagined different and better worlds. But these visions (e.g., Plato’s Republic, Thomas Moore’s Utopia) were usually backward looking and elitist. Their authors had nothing but contempt for peasants or slaves who raised the flag of rebellion and who asked, in the words attributed to the radical priest John Ball in the English Peasant Revolt of 1381, “When Adam wove and Eve span, who was then the gentleman?”

Origins

Socialism as it is understood today was a product of the economic and political forces created by early capitalist development in Europe. Its political origins derive from the French Revolution. Although this was primarily a conflict for power between privileged groups, it unleashed massive political debate around the ideas of liberty, equality, and fraternity. The crowds of Paris and other towns, the artisans and sans-culottes began to make an independent mark. This challenge from below was contained, but its legacy remained. The difficulty was to know how to build on it. Writers and activists like Babeuf, Buonarroti, and Blanqui recognized the suffering of the people, but at this time, could only see the way forward in terms of small groups taking power from society’s existing rulers and handing it to the people.

It was the Industrial Revolution that opened up new possibilities. Urbanization and industrialization created a social force—the working class—that early on began to forge its own organizations (from trade unions to political movements like Chartism in England) to demand rights for itself and to challenge the injustices and inequalities that the mass of workers faced.

The great achievement of Karl Marx and Friedrich Engels, from the 1840s, was to see the potential of this new movement. At the level of theory, they took what was a moral critique of capitalism and turned it into a scientific one by trying to unravel the ways in which alienation and exploitation occurred. What compromised capitalism were not the irrationalities of individuals—these were themselves a product of systemic irrationalities. If capitalism was the most dynamic system yet known, it was also driven by a mass of contradictions. Capitalist class rule and organization perpetuated injustice, inequality, and suffering as the price paid by the mass of men and women for the privileges of those who ruled over them.

But a second aspect of their contribution was no less important. This was the argument that the solution to these problems lay in the hands of the mass of workers. Organized as a social force, workers had the power to change the world and they had to find a way to use this. In struggle, ordinary workers could find a common interest, solidarity, and understanding out of which a new society could be built. The emancipation of the working class had, therefore, to be an act of self-emancipation. When Marx and Engels called on workers of the world to unite, this was a call for men and women to take control of their own lives and not wait as a suffering class to be rescued from above or outside by the actions of philanthropists, statesmen, or conspirators.

When these ideas were first put forward, the working class, save in Britain, was still only weakly developed. As the 19th century progressed, industrialization spread and deepened and a working-class movement developed in the advanced countries with three arms. Trade unions were formed to cement the solidarity of workers in their workplaces. Cooperatives developed as an attempt to offer an alternative in distribution (and sometimes production) within capitalism. Political organization led to a proliferation of socialist organizations out of which the great socialist parties began to be formed in the late 19th century. These were then linked internationally with the creation of the Second International in 1889 (the First International of the 1860s, with Marx as its secretary, was a limited organization primarily focused on trade union links).

But as the socialist movement developed, major conflicts emerged, which led to a crisis that affected the meaning of socialism itself. The term came to be so widely appropriated and used and misused that in the late 19th century, a British liberal politician, Sir William Harcourt, could declare that “we are all socialists now.” A half-century or more later perhaps, a majority of the world’s population were told that they lived in socialist or semisocialist regimes even though none of them had advanced, and many had pushed back, the real cause of human emancipation.

Two related issues are central to an understanding of this. One is statification and nationalization, the other is the difference between socialism from above and socialism from below. For many commentators, capitalism is about the trinity of private property, markets, and profit. But over time, the state has come to play an important role in capitalist societies. If socialism is identified with statification then, with nationalization and control of the commanding heights in an economy, it can be argued that capitalism is giving or has given way to “socialism.” The state seemed to many to offer a more rational way of running society. This idea proved especially popular with some intellectuals going back to the French writer Saint Simon and even before. Supporters of this view assumed a world of competing states, but argued that if private property were suppressed within them, then the irrationalities of internal competition could give way to rule by the expert, administration by the competent, and order and efficiency, and so on. This could then be used to rule in favor of the many and improve the general interest.

However, success here required that state power be obtained and used as a lever to uproot private property. “Statt, greif zu!” (“State, take hold of things”), Ferdinand Lasalle, an early German supporter of “state socialism,” had argued. Subsequently, reformist socialists developed this idea, but gave it a more democratic tinge by arguing that if workers won the franchise, they could then use it to elect these leaders into power where they could use the state on their behalf. In these terms, although social democratic politicians were sharply separated from more dictatorial currents by their attitude to political democracy, they were much closer to them in their attitude to the state than they liked to imagine.

It needs to be stressed that this reduction of capitalism to a narrowly conceived argument about legal ownership of private property was not part of Marx’s original vision. For Marx, property that was not under genuine social control was private property whether it was held by the individual or the state. The state was not an agent of human emancipation but a class institution and an instrument of repression over the many. It was not possible to use it to build a noncapitalist world; rather, it had to be cleared away.

The substitution of state property and planning seemed only to change the form rather than the continent of social relations—to replace a narrow private capitalism with forms of state capitalism. The issue was not whether the state controlled, but who controlled the state and what determined how it operated? The same point was no less forcibly made by Rosa Luxemburg, who argued that if socialism was about state control, then Napoleon and Bismarck should be counted among its pioneers.

Socialism from below looked forward by contrast to a world in which every cook might govern. For this to happen, workers had to take control of society and build democratic structures from the bottom up. This idea was at the heart of Lenin’s arguments in his State and Revolution, written in the full flush of revolution in Russia in 1917. The existing state seemed to be disintegrating, to be replaced by factory committees, and workers’ soviets and new organs of workers’ power. It is often forgotten today that many of the democratic freedoms and social gains that are taken for granted were in fact a product of such struggles from below and social and revolutionary crises. Significant reforms have usually had to be battled for over long periods; intellectual argument was rarely enough. They have also had to be defended as the balance of power has changed and pressures have developed to reduce social protection and limit democratic gains.

Counterarguments

The challenge of socialism, especially from below, was often met with repression, but it also produced an intellectual counterattack by those who emphasized the limits to change and claimed that capitalism draws on “natural elements” in human society—a claim that socialists strongly reject. These counterarguments helped to form much of the development of the “classical” foundations of the modern social sciences. For these critics, the failure of socialism was inevitable (although some compromised their own intellectual integrity by the succor that they gave to fascism). Max Weber’s arguments about the inevitability and rationality of bureaucracy were in part directed against socialist ideas of rule from below. Robert Michels argued that it was an “iron law” that oligarchies would always rule, basing his claims on his disillusioned analysis of pre-1914 socialist parties. For Vilfredo Pareto, revolution was simply a process by which an old elite was overthrown by a new one. Gaetano Mosca argued that there always had to be a ruling class. These arguments questioned the political impossibility of socialism. In economic terms, Eugen von Böhm-Bawerk argued that Marx’s economics were flawed by internal inconsistencies. Ludwig Von Mises went further and argued that any attempt to suppress the price mechanism would produce chaos and irrationality so that socialism was economically impossible, too.

Whether these arguments against socialism are correct continues to be disputed and not least by socialists. But the subsequent development of self-proclaimed socialist states in the 20th century seemed to give credence to hostile arguments. But if in the past century it has always been possible to find someone to defend the indefensible in the name of “socialism,” it is important to recognize the intellectual depth of the critique of so-called socialist regimes that developed within the socialist movement.

Socialist States

Following the outbreak of World War I, the socialist movement split into a majority tendency in which the different parties supported their own governments in the conflict and a minority tendency that opposed the war. This split was confirmed by the Russian Revolution. After the war, the former tendency developed into reformist social democracy embodied in the German Social Democratic Party, the French socialists, the British Labour Party, and the Swedish socialists. But in the 1930s, socialism was forced to retreat in the face of fascism, save in Sweden.

After World War II, social democracy made major political advances with social democratic governments often in power, albeit for differing lengths of time in different countries. Social democracy did achieve significant reforms although their critics on the left argued that these were still too few and came at a time when a growing capitalism could afford concessions. For many, the most extensive and to some extent model reforms were, and still are, to be found in a country like Sweden. The aspirations of socialist parties in power, however, soon reduced to that of creating a more humane capitalism, provided that this did not interfere with the essential functioning of the system.

In the last decades of the 20th century, however, the commitment to reform wilted, especially in the face of new economic difficulties. A new accommodation was reached with capitalism by some parties— led perhaps by New Labour in the United Kingdom.

Even socialism as a distant goal began to give way to talk of a “third” way between market capitalism and state planning (Russian style), although in reality, it was hard to distinguish what this consisted of as the retreat to promarket position grew more intense, especially in the United Kingdom.

Counterposed to the social democratic tenancy was the communist one. But this was soon marked by events in Russia. This marked not only the history of communism, but also, by association, that of socialism. While most historians accept that the Russian Revolution was a genuine mass revolution, it soon gave rise to a brutal dictatorship under Stalin as the regime tried to “catch up and overtake” the West. Dictatorship also characterized the regimes that followed in its footsteps after 1945.

One question that is the subject of wide debate is whether the revolution or its leadership was flawed from the start or whether a process of degeneration occurred because of contingent factors such as the civil war, hostile pressure, and so forth. Another is whether the resulting regime can legitimately be called socialist or whether its statism reflected the emergence of an extreme form of state capitalism or even some new third form that was neither capitalist nor socialist. The statism of the Soviet Union was in obvious contradiction to many of Marx’s and even Lenin’s arguments. But it did draw for legitimacy on that strand of socialism that identified change with the abolition of private property as a legal form and rule over the people, albeit in the name of the people. Western opponents of the Soviet Union were happy to take its self-proclaimed socialism at face value and to use it to condemn all forms of socialism. They were no less happy to claim that, as the Soviet Union expanded its influence after 1945, what was at stake was a systematic conflict between two worlds— “socialism” and “capitalism.”

The equation “socialism = state = Soviet Union” (or China, Vietnam, Cuba, etc.) also narrowed the theoretical debate over socialism. In economics, for example, the question became not whether a socialist regime could begin to end exploitation and alienation, but whether state planners could emulate the alleged efficiency of market capitalism through either a directed central plan or some form of “socialist market.” What became known at the level of theory as “the socialist calculation” debate seemed to be solved at the level of practice when growth rates in the so-called Socialist bloc faltered and many of these regimes disintegrated in 1989–91.

If the regimes that developed in what was once called the “third world” also had little relation to the ideas of socialism as set out by Marx, how then do we explain them? The answer seems to lie in the pattern of unequal development that capitalism creates within and between countries. This unequal structure, one associated with colonial rule, seems to have deeper roots in the global nature of capitalism as a system. Local bourgeoisies often accepted a subordinate role in this global order, compromising with big powers, merging with sections of the traditional local ruling class, becoming in the process an additional corrupt blockage in the way of development. Trotsky argued in the 1920s and 1930s that this created wider conditions for permanent revolution. Workers and peasants could overthrow their local ruling class and join with workers in advantaged countries to create the basis for a genuine global development. But he underestimated the extent to which modernizing elites—intellectuals, teachers, army officers, middleranking administrators, driven both by the hope of a different world and the shame of backwardness and frustration at their own marginal position in their own societies, and so forth—might organize to seize power in the name of the people.

Permanent revolution could then be deflected into anticolonial, nationalist development programs. This is what happened in Asia, in places like China and Vietnam and in many parts of Africa and Latin America after the end of World War II. Although these regimes variously described themselves as socialist, they were really nationalist development regimes. Moreover, because they had to rely on local resources for development, they were often forced to impose forms of superexploitation on the peasants and workers in whose name their leaders ruled. Growth did occur, but not to the extent that they hoped and not as often. Lacking democratic constraints, leaderships become more corrupt with coups and countercoups. This “third world developmental socialism” or perhaps better “developmental state capitalism” began to break down in the 1980s when it became obvious that the Soviet model was in difficulties and new spaces appeared to open up for development with the successes of the first Asian

Tigers. Even in China, state control gave way to more market principles.

Socialism Today

Why has there not yet been a successful revolution in an advanced country? To explain this, socialists usually offer some combination of three arguments. The first is ideas. Capitalism generates ideas that can prevent workers seeing where their real interests lie. One aspect of this is what Marx called commodity fetishism—the tendency to imagine that it is not people but abstract “natural” forces like “capital,” “supply and demand,” competition, globalization, and so forth, that rule our lives. Ideologies then developed on this basis, which encourage people to believe that only a privileged elite has the knowledge, virtue, and merit to control capitalism. Workers are encouraged to identify with this class and to divide themselves through racism, sexism, nationalism, and so on.

When radical conflicts do occur, a second issue comes into play—this is the problem of organization and leadership. Organization is necessary to hold people together and allow their energies to be directed, but if political leaders are not prepared to seize opportunities when they arise in a revolutionary situation, then the impetus for change will be lost. To this must be added a third argument. No ruling class voluntarily relinquishes its power and whenever conflicts emerge, ruling classes have shown themselves able and willing to use state power and force to defend their interests.

When the Soviet bloc collapsed, its identification not only with communism but also with socialism seemed to suggest that history as a struggle between great ideological alternatives had ended. Liberal capitalism had triumphed and now had no serious competitors. But opportunistic declarations of the death of socialism seem premature and not least if what had actually collapsed was not socialism in any meaningful sense. Indeed, it could be argued that the destruction of these forms was necessary to allow a return to a more authentic tradition. Certainly, the case for a socialist alternative to capitalism retains an appeal.

Socialists point to the way in which capitalism in the new century remains polarized. The gap between rich and poor has been growing in many parts of the world and rates of social mobility declining. Corporate power remains concentrated and globalization has stretched it in a new direction without bringing an end to war. Worse, the pursuit of private profit seems to be risking environmental and ecological disaster. Equally, socialists would claim that a striving for justice, equality, and popular control continues and the idea of a world in which ordinary people control their own fates remains valid, no matter what critics of socialism and supporters of capitalism might say.

For socialists, the key issue perhaps remains wherever a movement can be organized and sustained to avoid the errors of the past and achieve this. Those who dismiss socialism argue that the answer is no. The failures of the old were inherent to the socialist project itself. Those who support it answer yes. However, we should note that for all the talk of the end of socialism, the paradox of history is that it might be argued that the objective conditions out of which it might be built continue to mature.

It was only in the late 1980s and 1990s that the working class, on a global scale, became the majority class for the first time in history. Hitherto, although the majority in individual countries, workers had been outnumbered on a global scale by other groups and not least peasants. Today, in many parts of the world, earlier struggles are being repeated and trade unions, for example, with over 160 million members worldwide remain the largest voluntary organizations in the world. No less, albeit in a contradictory way, the capacity of the world to eliminate want has increased, just as globalization is helping to integrate the lives and fates of the world populations. The emergence of the antiglobalization and antiwar movement began to breathe a new life into old arguments and challenge the complacency and complicity of the older socialist parties in some of the darker aspects of modern capitalism. Where this will lead remains an open question for the new century.

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