Mises Wire

Why Socialists Love the Phrase “It’s Not Real Socialism”

The main reason that the socialists have had the staying power that has, luckily, eluded the Nazis is the argument that these self-acclaimed socialist regimes were “not real socialism.” One influential intellectual responsible for popularizing this argument is philosopher Noam Chomsky, who postulates that socialist regimes, the USSR specifically, merely pretended to be socialist to give themselves “legitimate” reasons to wield their authoritarian “club” against their people. The argument has since spread like wildfire through college-age socialists and presidential candidates such as Bernie Sanders. Labeling past socialist regimes as “not real socialism” allows socialists to avoid the argument put forth by antisocialists throughout history, or so they think. The problem with characterizing these regimes as not socialist is not only an ignorance of their history but that it does not allow socialists to escape the problem of economic calculation and the eventual descent into despotic authoritarian regimes.

To first identify whether or not the “socialist” regimes of the past were truly socialist, we must first establish a definition of socialism. Merriam-Webster’s Dictionary gives us three different definitions to work from. The first reads, “any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods.” The second is “a system of society or group living in which there is no private property” or “a system or condition of society in which the means of production are owned and controlled by the state.” Finally, the third reads, “a stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done.” All three definitions are variations of the first definition, with added specifics of origin, policy, and actors. Consistent among these definitions is the state, government, and collective as an actor who controls the means of production and property. Only 17 percent of America’s population acknowledges this definition of socialism, compared to 34 percent in 1949. Twenty-three percent of Americans today define socialism as a form of equality while another 23 percent hold no opinion. Finally, 10 percent define it as services such as social safety nets such as Social Security or Medicare. The rest have either vague, nonspecific opinions or negative opinions of socialism.

What we can conclude from this is that Americans are largely ignorant of actual definitions of socialism. This likely includes many of its own supporters. Despite the ignorance of socialism’s modern-day supporters, its spiritual founders, such as Marx, acknowledged and embraced this definition. However, they specified it as a response to capitalism that must have democratic characteristics. They view the “workers,” or the collective, as the ones who must control the means of production for any system to be true socialism. Although some socialists try to define it more specifically and disconnect it from the state, it cannot be ignored that the state is a manifestation of the collective consciousness of society. This is true especially in democracies, under social contract theories that socialists typically subscribe to and use as reasoning for the “obligations” that the state has to society. This logical reasoning alone should be enough to identify regimes such as the USSR, where the state took control of the means of production, as socialism. But there is even more evidence of this fact to explore.

When backed into a corner, socialists will begin to argue about the facts of the Soviet system. They will identify the system as “state capitalist” instead of socialist. It seems that to socialists the mere existence of enterprises identifies a system as capitalist. Enterprise somehow equates to private ownership of capital and property. But with the previously established definitions of socialism, the most baseline observation of the Soviet system is enough to dismiss this assertion. By the admission of the USSR’s own Western supporters and critics in the 1930s, it was a force to be reckoned with despite its massive reforms of state-controlled industries. American writer Joseph Freeman described it as follows: “for the first time I saw the greatest of human dreams assuming the shape of reality. Men, women, and children were uniting their efforts into a gigantic stream of energy directed toward…creating what was healthy and good for all.” Even the English socialist economist Sidney Webb praised it for the “widest possible participation of the whole adult population in the public business, which includes the planned control of the whole social environment.…Power does actually emanate from the people, as Lenin insisted.” All of these quotes are the words of USSR and Stalin supporters, who wrote them during or after the previously mentioned famines. This shows an inconsistency in socialists’ arguments over time. The sour attitude toward the USSR did not begin until the 1950s, after Stalin’s death, when socialist intellectuals began to fall quiet on questions related to the USSR and instead turned their focus to levying similar praises for other socialist regimes of the twentieth century. If the claim that the USSR was never socialist to begin with is correct, why would the argument not have developed until the resurgence in socialism’s popularity? Why would the socialists of the time still defend their regimes through some of the worst disasters of the century?

Even if you are able to explain away the change in attitude as retrospection done many years later and the evolving attitudes, the economic data does not hold up any better for socialists. An in-depth analysis of the Soviet regime shows that most if not all personal wealth was confiscated and redistributed by the state. The state entirely controlled the price systems and the means of production. This means, as explained by both critics and supporters, that not only does the Soviet Union fall into the trap of economist Ludwig von Mises’s calculation problem, described in his book Socialism, but that it is by the socialist definition a socialist state. This allows us to well categorize the USSR, like all other socialist states of the twentieth century, as definitely socialist. Modern examples of socialist regimes are also beholden to the problems of these past regimes. Venezuela, once praised by America’s most notorious self-proclaimed socialist Bernie Sanders, faces the problem of economic calculation. Due to its nationalization and collectivization of industries since the election of Hugo Chavez and later Nicolas Maduro, the country faces the exact situation that Mises describes as a result of no economic calculation. Before Chavez took power by democratic means, Venezuela ranked in the top five wealthiest nations in all of South America, even coming out at the top for much of the 1980s. Then, after the reforms of Chavez and later Maduro, GDP per capita fell dramatically and Venezuela has become one of the poorest nations in South America. This compared to Chile, which in the same period went from one of the poorest to one of the richest nations in all of South America by implementing policies of the exact opposite nature—free market policies such as deregulation and tax reform.

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