[On Freedom and Free Enterprise: Essays in Honor of Ludwig von Mises (1956)]
Professor von Mises has defeated socialism after placing it on scientific ground. This is one of his titles to fame. And yet the name of socialism is still identified with deluded hopes and with memories distorted by time. We therefore propose to examine the so-called socialist doctrine that has survived in France and now serves as the party banner to the "French Section of the Workers' International" (S.F.I.O.).
Economists concur in the belief that there are two characteristics of socialism in its noncommunist form:
- its goal, i.e., the socialization of the means of production and redistribution according to effective services rendered;
- its means applied, i.e., reforms attained through the manipulation of political forces.
Communists, however, advocate the total socialization of production, with the distribution of goods according to need. They count upon the evolution of productive forces to obtain this result. Those who hold to the first doctrine would modify capitalism with graftings of statism, whereas the communists anticipate its spontaneous collapse.
In reality communism reveals a definite shape, whereas we have but a fleeting vision of socialism. A large segment of public opinion conceives the difference between the two doctrines to lie in the submission of the one to the orders of the Kremlin and the maintenance of an independence from Moscow by the other. Undoubtedly, in Stalinist terms, the sole criterion of the noncapitalist world is its conformity with society as organized in Russia — which in its evolution must theoretically evolve through socialism to reach communism. For this reason those socialists in France who refuse obedience to Moscow call themselves "French Socialists." Thus our French socialism assumes a character contrary to tradition — for in the past it has always posed as a champion of internationalism — and contrary to its name: Section of the International.
To reinforce their position the French socialists attempt to provide their party with historical foundations. They endeavor to reestablish its connection with the predecessors of Marx. But they have not been too happy in this undertaking. For one of their most eminent spokesmen, the sociologist Bouglé, in his book entitled, Socialismes français[1]reviews three 19th-century economists whose identification as socialists is very dubious: Saint-Simon, the industrialist who gave power to industrial managers; Fourier, the advocate of cooperatives who generously remunerated capital; Proudhon, the anarchist who reviled the socialists.
Bouglé belongs to the large group of French socialist writers who embrace a truly imperialist spirit: in tracing their socialist ancestry they annex those economists who are not patently liberal and who only may be called "socialists" if one defines the term very broadly and vaguely or, as is often the case, if one abstains from classifying them at all. For them, he who proclaims the supremacy of reason and justice is a socialist. This is the opinion of Leon Blum, for example.[2] But if this were the criterion, there would no longer be a problem, for forty million Frenchmen would all be socialists!
The same thing may be said of present-day writers who apply the term "socialist" to anyone who dedicates himself to the promotion of the common good. These authors disdain the use of classical definitions and even refrain from mentioning their hostility for individual property, which after all is the most distinct characteristic of socialism. Such is the case of Mr. A. Spire who in his Inventaire des socialismes français contemporains writes: "Socialism assumes that the purpose of economic activity must be in harmony with collective interests."[3] And thus socialism benefits from this ambiguous definition uniting Christian socialists and syndicalists. The confusion is complete!
Let us recognize that socialism in France has met with misfortune. Whereas liberalism is presently experiencing a magnificent revival through neoliberalism, socialism has been arrested in its doctrinal evolution by the failure of the neosocialists: Déat, Marquet, Frossard and some others. These leaders recognized correctly that National Socialism indeed was socialism as its name indicates, and that Hitler "had realized true socialism in Europe." But they were mistaken in drawing from this the conclusion that they could collaborate with the invader. The French socialists not only reproached them for their "treason" but also denied that Nazism had been socialistic, which is so grave an error that one wonders whether it was not deliberate. Indeed, it was better to be injurious to socialism than to recognize it as the doctrine of the occupant. The German economy was certainly socialistic, but the followers of socialism were not motivated by this fact to place themselves under orders of the Nazi leaders.
Let us examine the two contemporary authors who are both theorists and men of action. Both have studied extensively the science of economics and have participated in contemporary politics: Messrs. André Philip and Jules Moch, both former cabinet members.
In 1952, André Philip expounded his ideas in an address to the Société d'économie politique[4] and in an article published in the Revue socialiste.[5] Indeed, he rejects the Marxian theories and recognizes that the doctrines of capitalist concentration and growing pauperization of the masses are fallacious. He is cognizant of the fact that the lot of the working class is improving, and that labor and management sometimes cooperate in the exploitation of the consumers. Thus he openly abandons Marx and finds another master in Keynes — an unexpected but understandable affinity, for this eminent British economist declared himself a defender of capitalism, but expounded the theory of full employment. André Philip lays little emphasis on doctrine, maintaining that those socialist countries which do not resort to any particular doctrine are better off than those that do, because there are no rigid principles which may hinder adaptation to changing conditions. According to Philip, socialism must conform to certain developments, that is to say, those developments concerning the working class. This is the key to many socialistic notions in France: the precedence of the worker. Everything must hinge upon him; he must be assured the maximum well-being.
We find the same ideas by A. Spire. The general interest is deliberately sacrificed to a collective interest, that of the laboring class. Thus, after having renounced Marx, André Philip reaffirms one of his principle doctrines and makes it the very core of his system: the war of classes.
But in his entire presentation there is not a single attack against private property, nor capital, nor profit. Socialism has become hazy and elusive merely existing on its recognition of its servitude to one segment of the population.
With Mr. Moch we get an entirely different perspective. The latter part of his large volume entitled Confrontations[6] interestingly presents the plan of the future state. A central authority regulates the economy with the help of statistics, distributes the factors of production, manages investments, and redistributes the products according to needs. In the case of a shortage, consumption is limited through rationing for the sake of production; at other times the public officials set prices in order to modify demand. One trembles in the thought that the planners vested with so much power are human beings who may err and be led by their feelings and emotions.
Naturally, interest from capital is abolished. It is difficult to understand why the author at first poses as the defender of small savings, without further defining such savings, whereas he later condemns them severely. According to Mr. Moch, small savings must disappear but the victims of this expropriation will be indemnified with a lifetime annuity equal to the average income from the securities expropriated.[7]
It can be seen that this promised land closely resembles the communist paradise. Besides, the author revives the Marxian doctrine through his tacit approval. But he never stops chanting a hymn in praise of liberty, in spite of the authoritarian nature of the system he recommends.
After reading these basic texts, we are at a loss for a proper definition of French socialism. The leeway between the two authors whose works we have just examined is such that we could insert between them all the doctrines that run the gamut from communism to liberalism. Thus socialism is nothing more than a label affixed to a flask whose contents vary according to the whim of the shopkeeper.
How then can we explain the existence of such a socialism in France? First of all, its greatest strength is its vagueness: everybody believes what he wants to, adding to it some of his own ideals. Politically speaking, this doctrinal adaptability lends itself to very clever combinations. The problem consists of distributing the promises and benefits among the groups which compose the National Assembly in such a way that enough are satisfied to assure a majority. For example, Mr. Pineau, who was invited to become President of the Council of Ministers but was defeated in February 1955, presented an economic and social program that on many points was not in accord with socialist ideals, as, for example, on the organization of agricultural markets. He even failed to propose all the reforms demanded by the socialist party at the Congress of Suresnes in 1954, notably, in fiscal matters.
Furthermore, socialism in France benefits from two major noneconomic characteristics: its sentimental flavor and its mystic nature.
Socialism poses as the defender of the weak and the poor. Its spokesmen never fail to reiterate the sad conditions of the workers and, above all, of women and children at the beginning of the nineteenth century, for which they blame present-day capitalism. This sort of anachronism impresses the rank and file who are always easily moved. "Men of heart are socialists," says Mr. Moch. There is no doubt that capitalism, which serves as the whipping boy, is presented as monopolistic, Malthusian, instigator of unemployment, war, etc. Indeed one wonders how the readers or listeners can take such a dubious, if not ridiculous, picture seriously.
In reality, it is a one-way sentimentalism. A great number of socialists believe that only the workers are poor, which contradicts actual fact. In France the "economically weak," the small investors, pensioners and aged and sick, are all much more destitute than the workers. André Philip, Jules Moch, and others believe in Jaurès' prediction that "Socialism will come into its own with the growth of the proletariat."
Thus, the socialists are motivated by the interests of a single class and not by the general interest. They candidly acknowledge that governmental measures are accepted or rejected according to the advantages they promise to the workers. Everything else is sacrificed. This is why the socialists oppose any reform of nationalized enterprises and of social security, in spite of the abuses denounced by boards of enquiry. This is also the reason why they do not flinch before the budgetary deficit, inflation[8] or devaluations of the currency, as we have seen in 1936 and 1937. In order quickly to bring about the hoped-for improvements, the socialists try to raise wages and social costs instead of seeking ways to lower prices, even at the risk of ruining other social classes. In other words, the socialists are apostles of "redistribution of income" through fiscal means. To sum up, we may say that they propose to combat misery — when they are not creating it!
This characteristic class sentimentality has a strong attraction for religious writers. In Catholic circles a campaign is being conducted in favor of an "economy of needs." Their reasoning is as follows: Present demand corresponds only to effective wants and not to genuine wants. The economic price mechanism is inhuman. Society must therefore renounce the play of the law of supply and demand and substitute a system based on the satisfaction of wants. According to these writers, these wants must correspond not only to the vital necessities but also to the amenities of existence and to the "higher values of civilization," which they call "needs of comfort" and of "elevation."[9]
This school of thought benefits from the prestige inherent in the word "humanism" which they make use of. Their opponents are cast in the role of those deprived of any humane feeling. But this is fallacious and confused. First of all, we may conclude from the remarks of these imprudent reformers, that the purchasing power which everybody possesses and which determines his demand, is attributable to chance. In reality, in an unhampered liberal society purchasing power is the outcome of an application of labor or sacrifice of saving. The price system is fair because it corresponds to merit. Next, the "humanitarians" want to distribute the products according to wants. They would thus destroy the tie between production and consumption. An even graver error is their confusion of needs with desires, thereby attributing to the latter the importance that should be reserved for the former. In a word, they arrive at the communist solution without even realizing it!
As to the mystic nature of socialism, people in France call it "leftist," which is a word without precise meaning but with popular appeal. Mr. Moch expressly emphasizes that socialism "is almost a secular religion." On such a ground logic is without force. The man in the street "votes to the left" because his leader wants him to. This reminds us of a parliamentary candidate of liberal leaning, who at the time when a district system of election existed, asked a good friend to run as a conservative — of course, without a chance of success. Now he could say at public rallies: "I'm to the left of this gentleman; he is the reactionary!" The words "right" and 'left" are among the most effective of all irrational gimmicks of French politics.
Has this sliding towards empiricism and this doctrinal disintegration of socialism brought at least more fortunate results in practice? A poll by the French Institute of Public Opinion[10] has answered this question: the "United Socialist Party" (S.F.I.O.) in less than six years has lost a third of its supporters who turned either communist or moderate. They are growing old noticeably, for some 34 per cent of its voters have passed the fifty mark and, among their loyal supporters, the men far exceed the women in number. It is characteristic that this workers' party is supported at the polls by large numbers of civil servants but relatively few workers who mostly vote the communist ticket.
As the crowning disgrace, the socialist voters lack a militant spirit. That is to say, they are little inclined to work for their party, hardly try to convince their friends, and do not like to discuss politics nor to contribute money. Worse still, they lack full confidence in the party leaders. "One voter in five has confidence in Mr. Guy Mollet; one in ten in Mr. Moch."
The poll taking concludes that the S.F.I.O. is a common meeting ground for "often contradictory aspirations, for doubts and uncertainties. It is not even a socialism which unites, but almost a group of different socialisms which assemble without a single direction designating the path which all may follow."
Recent events confirm these observations. In 1954–55 we were witness of the revolt of the parliamentary socialists against the central committee of the Party. The rebels went as far as to speak of their individual mental reservations in order to justify their insubordination at the time of the debates on the European Defense Community and the Paris Agreements. It is a party without a single leader who is able to assert himself.
The socialists themselves, in their newspapers and magazines, hardly fail to deplore the "decline," "defeat" and "dissipation" of their party and doctrine.[11] A shrewd observer, who is sympathetic towards socialism, already wrote in 1946: "The socialist idea has foundered and that's a fact."[12]
Some socialists find consolation in the fact that their party maintains a strong position wherever personal issues retain their importance, in regional and local affairs, in the general councils and in municipalities. Or they find comfort in their central position in Parliament between communists and moderates, which makes them the arbitrators with opportunities to shift the balance of power.
Some good authors attempt to "rejuvenate the doctrine," as they call it. But they are clever enough to circumvent classic socialism. Such is the case of Professor Robert Mossé who writes: "Central planning does not require the collectivization of all the means of production; it is compatible with the existence of private property in certain important areas." He rejects authoritarian central planning; he wants it to be flexible or as "strategic supervision of the whole."[13] In order to avoid bureaucratic tyranny, he falls back on the price mechanism as the yardstick of measurement, allowing free choice to consumers and workers. And he explains that the price alone permits comparison between costs and utilities and allows economic calculation.[14]
Oscar Lange suggested that socialists erect a statue to Ludwig von Mises in gratitude for having made them elaborate their doctrine. Such elaboration seems to be a transformation. The proper inscription of the base of the monument should announce the destruction of socialism rather than its perfection, for this alleged elaboration of doctrine is nothing more than its substitution by vague planning.
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The hopes of these advocates of control are varied. Certain of them cling to the conceptions of abundance, of technocracy or control over marginal prices. Their panacea is nationalization and redistribution of income through taxation. Others adhere to the ideas of improving the lot of the workers and of economic democracy through political or syndicalist action. Some latecomers are inspired by the Utopians and moralizers of the last century, but they are rare in this age where morality is not held in high regard. A few believe in the virtue of the movement for itself without wanting to know the bank towards which the current is carrying them. In all these tendencies and aspirations we fail to see a single socialist contribution. The literature and particularly the Revue socialiste axe curiously empty.[15]
We do not know whether our present socialism will still be in vogue in the year 2000, as has been predicted by a reformer. We believe that it will remain democratic, although also this expression has become quite ambiguous since the birth of "people's democracies."[16] But we deny that it would be a "true" socialism.
Let us conclude that so-called French socialism is today a "socialism without doctrine."
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This article is excerpted from chapter 20 of On Freedom and Free Enterprise: Essays in Honor of Ludwig von Mises (1956). It was originally translated from the French by Stephen DiBari.
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Notes
[1] First edition, 1932; third edition, 1941.
[2] Revue de Paris, 1 May 1924. Another socialist, M.L. Laurat, emphasizes reason rather than justice, demanding a rationalization of the system of social organization. (Economie dirigée et socialisation, Brussels, 1934; Le manifeste communiste de 1848 et le monde d'aujourd'hui, Paris, 1948.)
[3] Paris, 1945.
[4] January 8, 1952.
[5] April 1952, p. 346.
[6] Paris, 1952.
[7] In 1945, in a common manifesto, both communists and socialists demanded that the securities of those enterprises whose nationalization was recommended be transformed into lifetime annuities. The conditions of this transformation are those cited by Mr. Moch in his text.
[8] The Socialist Congress at Suresnes demanded a general increase in the guaranteed minimum wage, without its counterpart in productivity, fully realizing they courted the danger of a formidable inflation.
[9] Economie et humanisme, March–April 1954, p. 1.
[10] Published in the revue, Sondages, number 3 of 1952.
[11] For numerous references see this author's work L'aube d'un nouveau libéralisme, Paris, 1953, p. 125.
[12] François Mauriac: "Le crépuscule du socialisme," Le Figaro, 28 August 1946.
[13] "L'évolution doctrinale du socialisme," Revue de l'Institut de Sociologie de Bruxelles, 1952, page 373.
[14] Aux Ecoutes de la Finance, August 27, 1953.
[15] The revue Reconstruction, organ of the French Confederation of Christian Workers, makes a genuine effort to enter the sphere of doctrine.
[16] The word "democracy" vies with the word "socialism" for first place in the realm of ambiguity. (J. Monnerot: "Sur le déclin du socialisme," Liberté de l'esprit, November 1950.) Mr. Moch considers Saint Thomas to be a democratic socialist! It may be useful in this respect to recall that in the encyclical Quadragesimo Anno (par. 44 to 50), socialism clearly distinguished from communism is condemned.
