Socialism as it was Always Meant to Be

I found this document from some interviews on Democracy Now ("the exception to the rulers") with Noam Chomsky and others, on April 16-18, 2007. It is encouraging to listen to socialists criticizing the types of social programs being proposed by those currently in power. I decided to use it as a document for studying critical thinking. (Follow the link for the full text.)

Critical Thinking

As a Capitalist myself, a document on Socialism is an interesting exercise in several ways:

• It serves to point out the deficiencies and failings of capitalism. Such criticisms can be made constructive if we find ways to overcome them.
• Understanding another point of view does not imply agreeing with it. By understanding an opposing point of view, one can more clearly compare and contract one's own position.
• There is much that we can agree with here. Where did they go wrong? Where are the logical fallacies? Where are the false assumptions?
• Finally, are they wrong at all? It is good to ask ourselves if we are wrong. We are not perfect, so our understanding of our own position may need to be modified. If our understanding can stand up to criticism it will be strengthened.

Economic Systems

The introductions discusses several modern economic systems:

Criticism of Capitalism (public market enterprise) is that it generates inequality, alienation, and environmental destruction.

Criticism of Communism (centrally planned economies): it generates alienation, apathy, inefficiency, and environmental destruction, inequity, and is not democratic.

A third system, public enterprise market economies, is mostly theoretical, where "all physical means of production and natural resources part of the public patrimony and have everyone work for public enterprises which would then 'freely' exchange the goods produced." As an example, they mention in passing the "failed" Yugoslavian economy. The criticism is applicable to all "market economies": unfair distribution of wealth and labor, inefficient allocation of resources creating environmental destruction and antipathy, and creation of a ruling class of managers who dominate and exploit workers.

A fourth system is given as local self-reliance combined with direct democracy. This is criticised as not addressing the needs and problems of inter-locality trade, and therefore inefficient because of costly duplication of efforts. They mention New England, where such economies probably existed in colonial times.

Fifthly, they advocate their proposed implementation of "the original socialist vision", which is workers in different enterprises, industries, and consumers in different locations coordinating their joint efforts consciously, democratically, equitably, and efficiently to create a non-hierarchical and egalitarian economy. They admit that "socialism as originally conceived has never been tried" because no one could explain "how such a system could work". The difficult questions are: (1) how necessary decisions would be made, (2) why their procedures would yield a coherent plan, and (3) why the outcome would be efficient. And the main part of the document describes a system called participatory economics based on nested federations of workers' and consumers' councils.

Critical Analysis

A central concept of socialism is egalitarianism, that people are equal under the law, church, or society. Most economic systems before socialism are considered non-egaliarian because they feature a privileged ruling class, and a non-privileged lower class. Socialist believe capitalism is non-egalitarian because it substitutes a "owning class" for the ruling class, and therefore any true egalitarian society must be (the other essential component of socialism) non-hierarchical, or a pure democracy.

Much of the document describes how the system is egalitarian. They even recognize the central problem that if payment (or consumption opportunities) are equal, people will have no reason to work up to their capabilities (i.e. it generates apathy). It suggests an equitable (or fair) system of rewarding increased effort with increased payment. I am unconvinced that this does not generate apathy, because it only rewards effort and not success! I quote: "Instead we recommend emphasizing direct social recognition of outstanding achievements." They propose social rewards instead of material rewards for success. While social rewards are important for most people, they have only been shown, in practice, to be more important that material rewards when materials were already abundant. Socialism takes material scarcity as an assumption.

The question about a non-hierarchical system, or pure democracy, is whether it is possible at all. Many people want a leader, and will follow anyone who leads. (Christ called himself the "good shepherd" perhaps because people are so much like sheep.) They superficially address problems such as “dictatorship of the sociable" and inefficiencies of committee rule by asserting that capitalism has the same amount of inefficiency in the amount of time spent in meetings, for example. This is a rather weak argument, "we are no worse than the alternative", but the alternative held up is the worst of capitalism, the large inefficient corporations, rather than small and well-run businesses. How they will prevent popular leaders from usurping power by using their own popularity against general apathy is not addressed at all.

Apologetic for Capitalism

The non-egalitarian criticism of capitalism is just. Capitalism provides equality of opportunity, but not equality of wealth. (Christ affirmed "the poor you have always with you.") Capitalism harnesses greed by giving all people the same opportunity to get ahead. Much of the time, capitalism is self-correcting, because when greed gets out of hand, and goods are sold which are low-quality or overpriced, it creates an opportunity for someone else to produce the same good with better price or quality. Experience has shown that sufficiently large corporations can undermine this effect of capitalism and abuse their power to the detriment of all. Capitalism has relied on the state to correct such abuses, and as a result, government sponsored monopolies are the worst possible situation. Capitalism still needs to find its own solution to the problem, but keeping barriers to startup new businesses as small as possible is essential to healthy capitalism.

Leadership is a virtue which should be rewarded. When individuals are free to choose the rewards which are most valuable to themselves, there is maximum incentive, and greater opportunity to trade and compromise. A good example of this is the mathematical problem of fairly dividing a cake. This is only a hard problem if all parts of the cake are equal. It is actually easier to make everyone happy if they value different pieces differently, "you can have the slightly larger piece if I can have the one with the pink frosting rose."