The word socialism
first appeared in 1827. Robert Owen defined socialism as “the abolition of private property”. Karl Marx took a
similar line, and extended the idea of common ownership to the national economy.
At least at that time, socialism and communism were virtually synonymous, especially in terms
of their shared vision of the final goal. They both meant the common ownership
of the means of production, and the end of markets and competition.
Robert Owen
This view persisted throughout the twentieth century, including within the UK Labour Party. George Bernard Shaw wrote with approval: “Socialists are trying to have the land and machinery ‘socialised,’ or made the property of the whole people”. In 1908 the Labour Party Conference passed a resolution, adopting the aim of “the socialization of the means of production, distribution and exchange to be controlled by a democratic state”. In 1924 Sidney Webb summarized his view of socialism as involving “(1) Collective Ownership; (2) Collective Regulation; (3) Collective Taxation; and (4) Collective Provision”.
Similar views were found among Labour
Prime Ministers. J. Ramsay MacDonald saw socialism as “a movement to supplant
Capitalism altogether, by organising communally the services which Capitalism
performs or ought to perform.” In 1937 Clement Attlee wrote of the “evils” of
capitalism: their “cause is the private ownership of the means of
life; the remedy is public ownership.” Attlee then approvingly quoted the words
of Bertrand Russell: “Socialism means the common ownership of land and capital
together with a democratic form of government.”
In my book Is Socialism Feasible?I show the persistence of this view of socialism. I also discuss several attempts to change its meaning, including by Douglas Jay, Anthony Crosland, Deng Xiaoping and Tony Blair. Blair tried to shift the meaning to social-ism, by replacing the goal of common ownership by vaguely-specified “ethical values” and a recognition that individuals are socially interdependent. This attempt to revise the meaning has not made much of a mark.
Deng Xiaoping faced the
problem of persuading the Chinese Communist Party to support his enormously
successful market reforms. Deng declared:
“The essence of socialism is liberation and development of the productive forces, elimination of exploitation and polarization, and the ultimate achievement of prosperity for all … common prosperity is the essence of socialism.”
Note the subtle shift from property to prosperity. If that is socialism, then few people are not socialists.
But the original meaning endures. The Merriam-Webster
Dictionary defines socialism as “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.” This is remarkably
similar to the original definitions of Owen and Marx.
How
moderates help Corbyn, and socialists help Trump
Among prominent living politicians today, including
Jeremy Corbyn, Bernie
Sanders and Jean-Luc Mélenchon, Socialism has retained its original meaning,
of widespread common ownership, or at least they have not renounced that original
definition.
Bernie Sanders
At the same time, leading Labour Party moderates
who support a mixed economy continue to support “democratic socialism”. By
doing so they give succour to the full-blooded socialist left, who are much
closer to the enduring traditional view of socialism than the moderates themselves.
We can pretend that the word socialism has
shifted in meaning, but there is little evidence of a major and widely accepted
change.
Moderate or otherwise, those using the “democratic
socialism” label help to sustain the mistaken idea that socialism (in its enduring
and prevalent sense) is compatible with democracy. History and theory both show
that a totalitarian concentration of political power flows inevitably from the unmitigated
concentration of economic power in the hands of the state that is associated
with large-scale socialism.
Alexandria Ocasio-Cortez
A similar problem exists in the US, particularly
after the recent election of a young group of socialists to congress, including
the impassioned and eloquent Alexandria Ocasio-Cortez. Along with Sanders, they
are members of the Democratic Socialist Alliance (DSA) within the US Democratic
Party.
The DSA argues for “a vision
of a humane international social order based both on democratic planning and
market mechanisms”. They also argued that “widespread worker and public ownership will greatly lessen
the corrosive effect of capitalists [sic] markets on people’s lives”. While, unlike many other socialists, the
DSA notably accepts an enduring role for markets, its agoraphobic bias is
revealed by the failure to mention the corrosive effects of bureaucracy on
people’s lives.
In some
statements, leading DSA politicians seem to favour Nordic-style, welfare state
capitalism. But they have not made it clear that they support the large private
sectors and financial markets that are prominent in all the Nordic countries. Instead,
they go along with the abolition of capitalism. They distance themselves from
the Communist regimes of the past. But while the experiment with socialism in
Venezuela has led to a catastrophic human disaster, they
fail to come out in full condemnation of that regime.
This helps
Trump. Not only does he mobilise racist prejudices, he also uses their
self-declared socialism to describe
them as communist. Given that socialism and communism were (at
least originally) virtual synonyms, this ammunition is handed to Trump by his
most fervent opponents.
The changed
meaning of social democracy
When Social Democratic parties were first formed
in Europe in the nineteenth century, most were strongly influenced by Marxism.
They were fully socialist in its original sense.
Some separation of meaning between socialism and
social democracy occurred beforehand, but it was brought to a head by the onset
of the Cold War in 1948. Europe as a whole, and Germany in particular, were
divided between the Eastern and Western Blocs.
All socialist and communist parties had to
choose – the East, the West, or a plague
on both? With Moscow ties in many cases, almost all Communist parties chose the
East. Many moderate Socialist, Social-Democratic or Labour parties chose the West.
SPD Congress in Bad Godesberg 1959
At its Bad Godesberg Congress in 1959, the
German Social Democratic Party (SPD) made fundamental changes to its aims. It
dropped its opposition to capitalism, and it abandoned the Marxist analysis of
class struggle. The
SPD declared:
“The Social Democratic Party therefore favours a free market wherever free competition really exists. Where a market is dominated by individuals or groups, however, all manner of steps must be taken to protect freedom in the economic sphere. As much competition as possible – as much planning as necessary.”
The crucial point here is that the
SPD moved from (temporary or permanent) toleration
of markets and competition, to accepting
markets and competition as desirable, alongside strong public enterprise
and state regulation where necessary.
This explicit and fundamental change in
aims in the world’s largest and most influential Social Democratic Party led to
a separation of meanings of the terms social
democracy and socialism. But it
must be acknowledged that strong residues of old-style thinking persisted, in
the SPD and in social-democratic parties in other countries.
The acid
test
There is a simple test to distinguish a socialist from a social democrat, according to currently prevalent meanings of those
words.
To be a social democrat it is not enough to accept
markets and a mixed economy, as Jeremy Corbyn, John McDonnell and the Democratic
Socialists of America have done. After all, a mixed economy could be accepted
as a temporary staging post in the transition to full-blooded socialism, as Vladimir
Lenin did with his New Economic Policy in 1921.
A modern social democrat must go further. He
or she must make a clear and positive case why markets, competition and a private
sector are more than a temporary expedient. It
must be argued that these things are indispensable, both for economic efficiency
and the preservation of freedom. This is the acid test. The SPD in 1959 understood
this point and it passed the test.
As far as I am aware, neither Corbyn, McDonnell, Sanders nor Ocasio-Cortez have made such a positive case for a permanent private sector. If I am right, then they are socialists, not social democrats. Despite their protestations, they are closer to traditional communism than to modern social democracy, as practiced in the Nordic countries and elsewhere. I would be delighted if they can prove me wrong.
Large-scale socialism is outdated, extreme and
demonstrably incompatible with democracy. At least if these declared socialists
want to win parliamentary majorities and form governments, then they have to
change their terminology, and dispose with outdated and unfeasible ideas.
But while Nordic social democracy remains remarkably successful (as I show in my book Is Socialism Feasible?) the social-democratic brand throughout Europe has declined in electoral support. Although re-naming is necessary, much more than renaming is required. The abandonment of the socialist label is but a first step. But that is another story.
17 July 2019
References
Attlee, Clement R. (1937) The
Labour Party in Perspective (London: Gollancz).
Blair, Tony (1994) Socialism,
Fabian Pamphlet 565 (London: Fabian Society).
Crosland, C. Anthony R. (1956) The Future of Socialism (London: Jonathan Cape).
Democratic Socialists of America (1995) ‘Where We Stand: Building the Next Left’, DSA: Democratic Socialists of America. https://www.dsausa.org/where_we_stand.
Griffiths, Dan (ed.) (1924) What is Socialism? A Symposium
(London, Richards).
Jay, Douglas (1937) The
Socialist Case, 1st edn. (London: Faber and Faber).
When it was used by Robert Owen and his followers from the 1830s, the word socialism meant “the abolition of private property” and the adoption of widespread common ownership. That same meaning was accepted by Karl Marx and Frederick Engels. It was used in the twentieth century to describe Marxist regimes in Russia, China, Cuba and elsewhere. The goal of widespread common ownership was inscribed in the aims and values of the UK Labour Party from 1918 to 1995.
The socialist algorithm has eight steps, arranged in a loop:
Step 1: Critique. Point to all the dreadful things that have happened under capitalism, including war, famine, oppression, exploitation, economic inequality and environmental degradation.
Step 2: Dream. Propose a non-existent, imaginary socialism that is highly democratic, peaceful, egalitarian and non-discriminatory. Say that it includes widespread state ownership but avoid going into details on how a large-scale complex system would work, or about the institutional and administrative mechanisms involved, or how ultra-democracy would operate in practice.
Step 3: Ignore. Discount claims by leading economists, political scientists and historians that such a system could not work fairly and humanely, at least unless major roles were retained within the system for markets and private property. Press on regardless to the next step.
Step 4: Solidarise. Choose some regimes in the past that started on the socialist road, such as Russia, China or Cuba. If a new explicitly socialist regime – Venezuela for example – pops up and carries out some policies you like, such as reducing poverty and illiteracy, then give it your support for a while.
Step 5: Blame. When things go wrong with the nominated socialist regimes in Step 4 – including war, famine, oppression, exploitation, economic inequality or environmental degradation – blame foreign intervention, sanctions by capitalist countries or internal counter-revolutionaries. Don’t blame the issues ignored in Step 3.
Step 6: Deny. When it proves difficult to blame everything that goes wrong on foreign intervention, sanctions by capitalist countries or internal counter-revolutionaries, then deny the scale or even the existence of the problems.
Step 7: Rename. At the point where the socialist regimes nominated in Step 4 become so dreadful – with war, famine, oppression, exploitation, economic inequality or environmental degradation – to the point where blame or denial (Steps 5 and 6) are no longer plausible, then declare that these regimes were not, or are no longer, socialist.
Step 8: Return. Collect £200 and go back to Step 1.
This algorithm has variant criteria, particularly over those used to decide what regimes are described as socialist under Step 4. This leads to endless controversies among socialists over the criteria and outcomes of such choices.
The personal determination to deny facts in Step 6 may also waver among some less-hardened comrades.
Further controversy exists among socialists on the criteria deployed in step 7, which trigger the abandonment of the socialist label in particular cases.
The Russian Revolution
The Russian Revolution instigated the socialist algorithm and led to countless runs of the program. It has also illustrated numerous variants.
Some say that it never was “proper socialism” in the first place, for some reason, such as the failure to establish worker control of the factories, or the dissolution of democratic government. These purists move rapidly to Step 7, collect their £200, and move back to Step 1.
Bertrand Russell quickly collected his £200. He visited Russia in 1920 in a Labour Party delegation, where among others he met Lenin. Russell wrote in 1924: “Socialism … means the common ownership of land and capital, together with a democratic form of government.”
Hence, for him, Bolshevik Russia was never socialist. But Russell did not consider the possibility that any concentration of ownership and economic power in the hands of the state would always undermine political democracy. (Step 3.)
Or you may say that the Bolshevik regime was socialist up to the restoration of some private ownership and markets with the New Economic Policy in 1921. Or you could say that socialism ended in Russia with Stalin’s consolidation of power in 1928. Die-hard forgivers of Stalinism would say that it ended in 1991.
To survive, the die-hards need a good dose of denial (Step 6). For example, in 1990 Corbyn’s future aide Seumas Milne suggested that estimates of deaths under Stalin by Robert Conquest and others were too high. This was quickly contradicted when more evidence became available in 1991 showing that earlier estimates, particularly by Conquest, were in the right ball park.
Socialist Scrabble
Imagine the consternation and debate caused in Marxist circles over these problems. The neatest solution is to avoid any proclamation of socialism and describe all Soviet-style regimes as “state capitalist”. This is the ingenious solution of Tony Cliff and others. Cliff was the founder of what eventually became the Socialist Workers Party.
The trouble with this solution is that the definition of capitalism becomes so flattened and widened that it bears less resemblance to Marx’s analysis in Capital. This disparity becomes more severe when the importance for capitalism of financial markets is taken into account, as highlighted by Joseph Schumpeter and others. Competitive financial markets played no more than a marginal role in Russia from 1917 to 1991.
Leon Trotsky
Leon Trotsky was more subtle. He introduced the concept of “degenerated workers state”. This term signalled that the working class had gained power, but the system had become corrupted by an over-bearing bureaucracy. For Trotsky, Soviet Russia was neither capitalist nor socialist.
But true to his Marxist credentials, Trotsky had to argue that a system where a rising class was neither in nor out of power had to be unstable – it could only last a few years.
Trotsky was murdered in 1940, so he left that problem to his followers. This unstable “transitional” regime lasted for well over half a century, defying Trotsky’s analysis.
And so it goes on. There are numerous variants, and many moves on the socialist scrabble board – playing with labels or names.
Socialist Venezuela
The drama in Venezuela is playing out before us. Many – but not all – socialists hailed the election of the radical socialist Hugo Chávez in 1998.
In 2004 a number of intellectuals and politicians signed a “manifesto” declaring that they would vote for Chávez if they were Venezuelans. The signatories included Tariq Ali, Perry Anderson, Tony Benn, George Galloway, Eric Hobsbawm, Ken Livingstone, Naomi Klein, Ken Loach, John Pilger and Harold Pinter.
As late as 2015, when Venezuela was in ever-deepening crisis and human rights violations were abundant, Corbyn’s enthusiasm for the regime was undiminished. He remarked:
As the problems with the regime of Chávez grew in intensity, Step 5 (Blame) came into force. There may have been involvement by the CIA, particularly in the brief coup that overthrew Chávez for a few days in 2002. But hostilities from outside were relatively mild, particularly compared with Civil War that followed the Bolshevik Revolution in 1917. Venezuela continues to sell oil to the US and several other countries. Venezuela buys arms and military equipment from the UK, as well as from Russia and China.
Neither external nor internal opposition can adequately explain the unfolding catastrophe in Venezuela. In fact, the problems started at the beginning. Chávez manipulated electoral mandates to undermine democratic checks and balances, to increase executive power, to neuter the Supreme Court, to make criticism of his government illegal and to increase censorship.
The outcome after 2013 was the disastrous regime of Nicolás Maduro. Venezuela saw famine, oppression, exploitation, economic inequality and environmental degradation.
By 2018 there was hyper-inflation of around a million per cent per annum, and about three million Venezuelans – about 10 per cent of the population – had emigrated.
Despite his 2014 declaration of support quoted above, John McDonnell has now moved to Step 7, helped by a little more denial on the way. On 20 May 2018 he declared “I don’t think it [Venezuela] was a socialist country”. McDonnell has collected his £200 and returned to Step 1.
Conclusion: back to the beginning
Obviously, it all starts with Step 1. Let us pause here for a while. There is a lot wrong with capitalism. But let us distinguish between capitalist democracies and autocracies.
Democracy is a key variable. The Biblical Four Horsemen of the Apocalypse are conflict, war, famine and death. As I have outlined in my book Wrong Turnings, from historical experience the antidote is clear: the chances of war, famine and premature death can be greatly diminished through a society with democratic institutions that defends +universal human rights.
Many of the horrors of capitalism occurred under undemocratic regimes. Wars between democracies are relatively rare. Famines are much less common under capitalist democracies. Consequently, the reduction of death and misery from famine and war is best pursued by opposition to all forms of despotism, whether capitalist or Communist.
This does not mean that capitalist democracies are always peaceful and unoppressive. Far from it. What it means is that there is plentiful evidence that democracy reduces the chances of famine, environmental degradation, premature death and war. And, for explicable reasons, no socialist country has lasted as a democracy.
Dreaming (Step 2) is fine. But we have to practical and realistic. Rather than ignoring in Step 3, we need to understand. One of the major problems with socialism – at least in its statist and non-market versions – is that a concentration of economic power in the hands of the state leads unavoidably to a dangerous and undemocratic concentration of political power.
“There’s no food”
In the Venezuelan case, the concentration of political power, which was designed to achieve statist control of the economy, had adverse effects well before wholesale public ownership was achieved.
Either way, attempts to move toward socialism weaken the economic sources of countervailing power and undermine the socio-economic foundations of democracy. Despite pronouncements to the contrary, the centralizing mission of statist socialism always leads to the destruction of necessary checks and balances.
In history there has been no exception to this outcome. We may dream of socialist democracy, but in the end we must learn from history and from analysts who show the dangers or impracticalities of socialist solutions to the problems in the world. In short, statist socialism cannot co-exist with democracy and with the protection of human rights.
Stretching the word “neoliberal” to cover people as different as Deng Xiaoping and Donald Trump has turned it into an absurdity.
Geoffrey M. Hodgson
Once upon a time, the word neoliberalism might have been confined to an extreme form of individualism that eschews state regulation, promotes economic austerity and a minimal state, opposes trade unions and vaunts unrestrained markets as the solution to all major politico-economic problems.
But today the usage of the word neoliberalism is no longer so restricted. I have been told more than once that anyone who is not a socialist is automatically a neoliberal. Any defence of the existence of markets now risks quick rejection with an angry neoliberal stamp upon it.
More frequently these days, a wide range of politicians, from Margaret Thatcher and Ronald Reagan at one extreme, to Bill Clinton, Hillary Clinton, Emmanuel Macron and Tony Blair at the other limit, are all described as neoliberals, despite, for example, hugely varied policies on taxation, government expenditure and the role of the state.
In their book on Neoliberalism, Damien Cahill and Martijn Konings describe the US President Donald Trump as a neoliberal. Yet he is a supporter of protectionism and he has imposed import tariffs: he does not believe in free trade. The word neoliberal is now stretched beyond credence and coherence.
Sneaky Deng Xiaoping was a neoliberal
Guardians of socialist purity have described some errant Marxist or socialists as neoliberals. In his Brief History of Neoliberalism, Marxist academic David Harvey described revisionist-Marxist Deng Xiaoping as a neoliberal.
From 1978, Deng supported the reintroduction of markets into the Chinese economy. But he still proposed a strong guiding hand by the state, including centralized management of the macro-economy and the financial system.
Harvey admitted that Deng’s policies led to strong economic growth and “rising standards of living for a significant proportion of the population” but he passed quickly over this ellipsis.
In fact, Deng’s Marxist-revisionist “neoliberal” reforms lifted more than half a billion people out of extreme poverty, albeit unevenly and at the cost of greater inequality. That was about one-twelfth of the entire world population in 2000. With this development, China halved the global level of extreme poverty. The bulk of the poverty reduction in China came from rural areas.
This achievement is unprecedented in human experience. If China’s extension of markets is neoliberalism, then neoliberalism is the most beneficial economic policy in history.
Vladimir Lenin and Josip Tito as neoliberals
But earlier contenders for the title of “the first neoliberals” can be found. In her book on Markets in the Name of Socialism: The Left-Wing Origins of Neoliberalism, the sociologist Johanna Bockman found roots of neoliberalism in the experiments in so-called “market socialism” in Josip Tito’s Yugoslavia from the 1950s and in Hungary from the 1960s.
There is no stopping this neoliberal treachery – infiltrating socialism as well as capitalism!
Josip Tito
Adopting the methodology of Harvey and Bockman, I would like to nominate Vladimir Ilyich Lenin as the first neoliberal, for his betrayal of socialist central planning and his introduction of the New Economic Policy (NEP) in Soviet Russia in 1921. In this admitted “retreat” from socialism, Lenin re-introduced markets and profit-seeking private firms.
Crucially, in support of this nomination, there is evidence that Deng’s post-1978 reforms drew a strong inspiration from Lenin.
“A brainless synonym for modern capitalism”
Of course, I am being ironic. My point is that, thanks to Harvey and others, neoliberalism as a term has become virtually useless. As Philip Mirowski and Dieter Plehwe put it, neoliberalism for some has become “a brainless synonym for modern capitalism.”
Mirowski also complained that opponents “often bandy about attributions of ‘neoliberalism’ as a portmanteau term of abuse”. But Mirowski did not drop the term.
Geoffrey Hodgson & Philip Mirowski
In his superb history of the Mont Pèlerin Society, Angus Burgin commented critically on the term neoliberalism:
“It is extremely difficult to treat in a sophisticated manner a concept that cannot be firmly identified or defined.”
The word is no longer sound currency. Bad usage has driven out the good. It has become a swear-word rather than a scientific term.
Neoliberalism as a ruling class strategy
Part of the impetus behind the excessive and ultimately destructive use of the word neoliberal is the Marxist belief, expressed by David Harvey among others, that neoliberalism is a strategy serving the interests of the capitalist class.
Following the post-war settlement of 1945-1970, which conceded greater power and shares of income to organized labour, rising neoliberalism allegedly rescued the capitalist class.
Their evidence is that in several major countries from the 1970s, trade unionism declined in strength and the shares of national incomes going to the top five per cent increased.
Second, in several countries, including most dramatically in China, standards of living have increased, even for the lower income deciles. While for many people in the US, real wages have stagnated, this has not been the case in several other countries, particularly prior to the 2008 crash.
Third, the argument may exaggerate the degree to which the capitalist class is united, in terms of their real interests or of their perceptions of them.
Fourth, it is questionable that capitalist interests are best served by declines in real wages, given the powerful Keynesian argument that capitalist prosperity depends on effective demand in the economy as a whole. Higher real wages can increase prosperity across the board, and serve the interests of capitalists and capitalism.
Fifth, there are other, possibility more effective, strategies for countering the power of organized labour and reducing the incomes of many people in favour of the top five per cent. These alternatives include economic nationalism, which can take the extreme form of fascism. Generally these are not free-market, small-state approaches. If they are all labelled neoliberal, and regarded as the grand global strategy of the bourgeoisie, then the analysis becomes dangerously insensitive to the increasingly probable threats of economic nationalism and fascism.
Neoliberalism and the Mont Pèlerin Society
Perhaps the most well-informed and intelligent attempt to give neoliberalism a distinctive meaning is by Philip Mirowski, who associates it, more or less, with the Mont Pèlerin Society.
But the Mont Pèlerin Society changed to a degree, in substance and direction. It began under a different name in the 1930s and was first convened under its current name in 1947. It was then an attempt to convene different kinds of liberals in defence of a liberal market economy, just after the defeat of fascist tyranny, during an expansion of Communist totalitarianism, and while witnessing the rise of statist socialist ideas in Western Europe and elsewhere. Liberalism broadly was on the rocks: it needed its defenders.
As a measure of the relative inclusivity and internal diversity of the Mont Pèlerin Society, consider the testimony of the philosopher Karl Popper, who was a friend of Hayek and a prominent Mont Pèlerin member in the early years. Popper wrote to Hayek in 1947 that his aim was “always to try of a reconciliation of liberals and socialists”.
Michael Polanyi and Wilhelm Röpke
Michael Polanyi – the brother of Karl Polanyi – was a founder member of the Mont Pèlerin Society. He advocated Keynesian macroeconomics in a market economy, alongside a radical redistribution of income and wealth. He rejected a universal reliance on market solutions, seeing it as a mirror image of the socialist panacea of planning and public ownership. He did not mince his words against this “crude Liberalism”:
“For a Liberalism which believes in preserving every evil consequence of free trading, and objects in principle to every sort of State enterprise, is contrary to the very principles of civilization. … The protection given to barbarous anarchy in the illusion of vindicating freedom, as demanded by the doctrine of laissez faire, has been most effective in bringing contempt on the name of freedom …”
Polanyi had drifted away from the Mont Pèlerin Society by 1955, stressing its inadequate solutions to the problem of unemployment and its promotion of a narrow view of liberty as the absence of coercion, neglecting the need to prioritize human self-realization and development.
Michael Polanyi
In its early years, the Mont Pèlerin Society hosted debates on the possible role of the state in promoting welfare, on financial stability, on economic justice, and on the moral limits to markets. Like Polanyi and other early members of the society, Wilhelm Röpke argued that the state was necessary to sustain the institutional infrastructure of a market economy. The state should serve as a rule-maker, enforcer of competition, and provider of basic social security. Röpke’s ideas were highly influential for those laying the foundations of the post war West German economy.
While they received a more sympathy from Hayek, Ludwig Mises regarded Röpke’s views as “outright interventionist”. Mises once became so frustrated with these ongoing arguments in favour of a major role for the state that he stormed out of a Mont Pèlerin Society meeting shouting: “You’re all a bunch of socialists.”
The rise of Milton Friedman
Angus Burgin’s history of the society shows how its early period of relative inclusivity was followed by schisms, departures, and a narrowing of opinion. People like Polanyi and Röpke became inactive. Eventually the primary locus of the Mont Pèlerin Society shifted to the US, with greatly increased corporate funding under the rising intellectual leadership of Milton Friedman.
Milton Friedman
Hence the Mont Pèlerin Society evolved from a broad liberal forum to one focused on promoting a narrow version of liberalism that is more redolent of Herbert Spencer than of Adam Smith, Thomas Paine or John Stuart Mill.
This ultra-individualist liberalism entailed a narrow definition of liberty as the absence of coercion, it relegated the goal of democracy, it neglected economic inequality, it overlooked the limits to markets, it saw very limited grounds for state welfare provision and intervention in financial markets, and it stressed self-interest rather than moral motivation.
Perhaps Friedman was a neoliberal. Perhaps Hayek too. But if we add Lenin, Tito, Deng or Trump to the list, then we are in the realms of absurdity – the term becomes useless.
1 June 2018
This book elaborates on the issues raised in this blog:
Published by University of Chicago Press in January 2018
Bibliography
Bockman, Johanna (2011) Markets in the Name of Socialism: The Left-Wing Origins of Neoliberalism (Stanford: Stanford University Press).
Burgin, Angus (2012) The Great Persuasion: Reinventing Free Markets since the Depression (Cambridge MA: Harvard University Press). See esp. pp. 57, 80-86, 116, 121.
Cahill, Damien and Konings, Martijn (2017) Neoliberalism (Cambridge UK and Medford MA: Polity Press). See esp. pp. 144-5.
Harvey, David (2005) A Brief History of Neoliberalism (Oxford and New York: Oxford University Press). See esp. pp. 1-3, 120-22.
Jacobs, Struan and Mullins, Phil (2016) ‘Friedrich Hayek and Michael Polanyi in Correspondence’, History of European Ideas, 42(1), pp. 107-30.
Mirowski, Philip (2013) Never Let a Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown (London and New York: Verso). See esp. pp. 29, 71.
Mirowski, Philip and Plehwe, Dieter (eds) (2009) The Road from Mont Pèlerin: The Making of the Neoliberal Thought Collective (Cambridge MA: Harvard University Press). See esp. p. xvii.
Pantsov, Alexander and Levine, Steven I. (2015) Deng Xiaoping: A Revolutionary Life (Oxford and New York: Oxford University Press). See esp. p. 373.
Polanyi, Michael (1940) The Contempt of Freedom: The Russian Experiment and After (London: Watts). See esp. pp. 35 ff., 57-58.
Ravallion, Martin, and Shaohua Chen (2005) ‘China’s (Uneven) Progress against Poverty’, Journal of Development Economics, 82(1), pp. 1-42.
Bernie Sanders campaigned for the Democratic presidential nomination in the US in 2015-2016. In the primary elections he received over thirteen million votes. He won 23 primaries and caucuses and approximately 43 per cent of pledged delegates, compared to 55 per cent for Hillary Clinton.
Sanders is a long-avowed “socialist”. What does he mean by this term? This is not an attack on the personality of Sanders, nor an attempt to smear him. Instead it is a search for the truth. What does he mean by “socialism” and what are his intellectual roots?
Does democracy imply socialism?
This is not a story about Russian spies. It is about Russian dolls. Sanders is the outer form of a Russian doll, with the slogan of Democracy across his chest. This slogan is used to promote socialism, typically with some vagueness about its meaning.
For Sanders, democracy implied socialism and substantial public ownership. In a 1987 interview he explained:
“Democracy means public ownership of the major means of production, it means decentralization, it means involving people in their work. Rather than having bosses and workers it means having democratic control over the factories and shops to as great a degree as you can.”
Nineteen years later, Sanders was still repeating this argument that extended democracy implied a greater role for government. But he then side-lined the question of public ownership. When asked in 2006 what democratic socialism meant, he responded:
“[The] government has got to play a very important role in making sure that as a right of citizenship, all of our people have health care; that as a right, all of our kids, regardless of income, have quality child care, are able to go to college without going deeply into debt; that it means we do not allow large corporations and moneyed interests to destroy our environment; that we create a government in which it is not dominated by big money interest. I mean, to me, it means democracy, frankly.”
Given his rising prominence in the US, among a population that has not normally been sympathetic to socialist ideas, it is understandable that Sanders played up democracy and played down public ownership. But there is no evidence that he has abandoned his support for widespread common ownership.
Sanders is not alone in sometimes hiding his socialism behind the word democracy. Michael Moore did it in his ironically-titled 2009 film Capitalism: A Love Story, where he argued that
“capitalism is an evil, and you cannot regulate evil. You have to eliminate it and replace it with something that is good for all people, and that something is democracy.”
But democracy is a system of government, and it is not in itself a type of economy.
Like Moore, Sanders in recent years has been economical with the truth. As we have entered the new millennium he has left the details of his socialism vague. He grants his audience the freedom to choose its meaning.
Socialism: A love story
They may impute its original radical meaning of widespread common ownership. Or they can infer that Sanders is promoting a version of social democracy, as found in Denmark, Norway or Sweden. Sanders said in 2015 that
“we should look to countries like Denmark, like Sweden and Norway, and learn from what they have accomplished for their working people.”
“I would like to make one thing clear. Denmark is far from a socialist planned economy. Denmark is a market economy.”
The Nordic countries mentioned by Sanders have relatively high levels of taxation and relatively low levels of economic inequality. They have strong welfare states. But they have not achieved anything close to socialism in its original sense. The private sector is still dominant. But by giving little guidance about what he means by socialism, Sanders can please a wider audience.
In a country where even minimal government involvement in the economy is habitually described by its opponents as socialist, Sanders has been opportunist. As he has come closer to power he has accepted the socialist label without much further explanation, knowing that for millions of Americans this is taken to mean even the mildest level of government economic intervention.
Sanders has allowed this inaccuracy to prevail, thus establishing a wide following among liberals, social democrats and radical socialists. He may have told the truth, but not the whole truth.
But crucially, neither Corbyn nor Sanders have elaborated a positive defence of the private sector.
Genuine advocacy of a mixture requires making the case for more than one type of ingredient. As well as their support for the public sector, they could have argued, for instance, that a substantial private sector is necessary for a viable civil society, to reap the benefits of competition, and to help sustain innovation and technological advance. Sanders and Corbyn have failed to make such arguments.
These arguments are rare among traditional socialists. The widespread absence of a defence of the private sector speaks as loudly as their calls for government intervention or common ownership. It suggests that a private sector is being reluctantly tolerated, and it would all be swept up into public territory if the opportunity arose. A mixed economy is to be accepted for now, as the system makes its transition toward full-blooded socialism and the abolition of all private enterprise.
Democratic socialism would take too many meetings
There is a further problem with the notion of democratic socialism that is adopted by Sanders and Corbyn. They promote a vague vision of extensive democratic control in the economy. Neither of them explain in detail how this extensive democratic decision-making is going to work. Would employees and consumers have a say on everything? How would they decide? How would the hierarchy of decision-making be structured?
The adjective democratic is kept as vague as the noun socialism. The details and feasibility of any such arrangement are simply ignored. If votes were held on every important question then the population would be overburdened with a myriad of decisions. Our lives would be taken up with meetings and voting.
It is impossible for anyone to gain expert knowledge on anything but a small number of technical and scientific issues. It would be counter-productive to put these technical issues to the vote. While many socialists have paid homage to some vague notion of “democratic control”, no-one has shown in theory or in practice how it would function in detail.
More Russian dolls inside
Let us go further into Sanders’ past. In the 1980s, when he was mayor of Burlington in Vermont, Sanders promoted a twinning programme with Yarolslavl in the USSR. He and his wife spent their honeymoon in the USSR in 1988.
This may be excused as an attempt to develop international understanding between varied communities, but this visit by an enduring, self-declared “socialist” to a “socialist” country under Communist Party rule would have been used to damage his presidential campaign in 2016, if he had won the nomination.
Going further back, as a young man in Chicago in the 1960s, Sanders was a member of the Young People’s Socialist League, which was the youth wing of the Socialist Party of America.
Founded in 1901, this party went through several splits and ruptures, but it was generally clear what it meant by socialism.
“[The] Socialist Party is to bring about the social ownership and democratic control of all the necessary means of production – to eliminate profit, rent, and interest, and make it impossible for any to share the product without sharing the burden of labor – to change our class society into a society of equals, in which the interest of one will be the interest of all.”
This formulation – involving widespread common ownership of the means of production – is in line with the original vision of socialism, as promoted by Robert Owen, Karl Marx, Vladimir Lenin, Leon Trotsky and numerous other socialists.
Finding Lenin and Trotsky
Eugene V. Debs (1855-1926) was the most famous leader of the Socialist Party of America and four times its presidential candidate, peaking at 913,693 votes in his 1920 campaign. Adopting the Marxist language of militant class struggle, Debs supported the 1917 Bolshevik Revolution in Russia. He also praised the attempted 1919 armed insurrection led by Karl Liebknecht and Rosa Luxemburg against the new-born German Republic.
In 1977 Sanders made a 30-minute documentary about Debs and his ideas. Sanders never recanted the version of socialism promoted by Debs and the Socialist Party of America.
In 1980 Sanders served as an elector for the Socialist Workers’ Party (USA), in an attempt to put this Trotskyist group on the presidential ballot, although Sanders was never a member of that organization.
Although Sanders was hugely popular during the 2015-16 primaries, if he had become the Democratic presidential candidate, then his Republican opponents would have milked this information about his Trotskyist links and his Russian honeymoon.
Leninism and democracy
Sanders is too vague about his socialism and his links with past radical socialists to draw too many definite conclusions. But the links are there, all the way back to Trotskyism and Leninism. It is ironic to compare how Sanders tries to champion democracy today, with the treatment of democracy by his Leninist antecedents.
In August 1917 Lenin explained in his State and Revolution that the forthcoming seizure of power would be highly democratic for the working class.
In November 1917 the Bolsheviks overthrew the liberal-socialist government of Alexander Kerensky. By the end of 1918, in the midst of a vicious civil war, all parties except the Bolsheviks were banned, and Russia had become a one-party state.
The “immense expansion of democracy” that Lenin had promised in his State and Revolution was not delivered. It would not have been feasible, even under the most conducive of circumstances.
As it turned out in Russia, there was no possibility of organizing a political force to counter, criticize or modify Bolshevik policy. Without organized alternatives to the ruling elite, democracy becomes a sham.
When the exiled Kerensky spoke at a London meeting in 1921, someone there claimed that the Bolsheviks were democrats. Kerensky responded:
“If it is democracy to banish your opponents, to suppress all meetings and newspapers, and to lock up people who disagree with you without trial, by what signs do you ask me to recognise tyranny?”
Let’s be honest about socialism
Sanders has tapped into legitimate discontent about inequality and poverty in the US, but has failed to explain how his version of socialism will work. He has kept the meaning of the s-word vague, thus providing himself with radical appeal with limited long-term practical substance, other than the adoption of some measures of reform within a capitalist economy.
From its inception in 1827 and for much of the twentieth century, socialism had the radical meaning of widespread common ownership that both Sanders and Corbyn originally promoted. Subsequently, some thinkers tried to shift its meaning, but no consensus emerged on its new substance.
Socialists should stop hiding their socialism behind the word democracy. Many socialists believe in democracy, but democracy and socialism are not the same thing.
Real-world socialism has failed to sustain democracy. This is a problem for socialism and it should not be ignored.
The connection between claimed “democratic socialism” and socialism in its totalitarian incarnations is avoided by Sanders and Corbyn by comparing the ills of real-world capitalism with an imaginary, idealized socialism that is unfeasible as it is invisible.
Sanders and Corbyn do not compare the ills of real-world capitalism with the ills of real-world socialism. If they did this honestly, then they might reach different conclusions. Instead of chasing socialist unicorns they might seek for the best within capitalism and then try to improve it further.
Despite the disastrous record of self-described “socialist” regimes, socialism (whatever it means) is remarkably popular.
According to a 2017 survey of American adults, 37 per cent preferred (what they described as) socialism to capitalism. Among millennials (meaning those reaching adulthood in the early twenty-first century), 44 per cent preferred socialism over capitalism. This survey broadly confirmed previous American polls from about 2015, which showed a surge of support for socialism, especially among younger people.
Polling in the UK found that 39 per cent of adults have an unfavourable view of capitalism, while 33 per cent were favourable. Also in the UK, 36 per cent viewed socialism favourably, compared to 32 per cent negatively. Germans were reported as even more positive about socialism, with 45 per cent being favourable and 26 per cent unfavourable.
These polling figures are remarkable, especially when we take into account that regimes describing themselves as socialist led to over 90 million deaths in the twentieth century. Socialism has captured the ethical high ground, despite the poor record of socialist regimes in terms of human rights.
Somehow today’s socialists evade this legacy. They argue that these regimes were not really socialist. Or they were corrupted by bad leaders. Or they suffered largely because of antagonism from the capitalist West. All these arguments assume that a humane socialism is feasible and that there are not congenital flaws in socialism that lead it to dictatorship.
Socialism raises the moral flag because it claims to be the creed of love, care and cooperation. By contrast, it is argued, capitalism and markets encourage selfishness and greed.
Socialists point to defenders of capitalism such as Ayn Rand, who like the fictional Gordon Gekko in the 1987 movie Wall Street, promoted the view that that greed is good and altruism is evil.
Mainstream Economists are tainted too: they often favour markets and assume individual self-interest as an axiom. Socialism will subdue markets, private profits and other spurs to greed, and through common ownership create a system that encourages people to cooperate together and act unselfishly.
So the argument goes. But the evidence tells a different story. The socialists, the “greed is good” defenders of capitalism, and believers in our total selfishness are all wrong.
Theory and evidence, from Darwin onwards, show that evolution has provided humans with a mixture of selfish, cooperative and moral capacities, which can be stunted or developed according to different cultural and institutional settings.
There is also strong evidence that market or trading relationships can enhance sentiments of fairness and reciprocity. The notion that markets always make people greedy, selfish and amoral has been refuted. The moral high ground claimed by socialism is challenged not simply by the misdeeds of socialist dictators, but also by extensive evidence about human nature and how it is affected by markets or other institutional circumstances.
Small-scale societies have relied on sentiments of cooperation and moral solidarity that have evolved within groups over millions of years. Solidarity within tribes or bands helped them survive in competition over resources with their rivals. But unfortunately evolution has not disposed us to be nice to outsiders.
The modern world has built up citizen loyalty to nation states, but the downsides have been hostility to foreigners and belligerent nationalism. In the modern world, institutions are needed to encourage mutual understanding and reciprocity on a global scale.
Thomas Paine
One of these institutions is the market. There is impressive evidence that, on balance, international free trade can reduce the risks of war between nations. In larger-scale systems, despite market competition, trade can build bonds and reduce conflict.
While the complete commercialisation of family and community life could undermine trust and altruism, wider trade on a larger scale increases mutual interdependence. As Thomas Paine, Richard Cobden, John Hobson and several others argued, markets can help to build solidarity within and between nations.
Socialism as “obvious”
Yet, despite evidence to the contrary, socialism still clings to the high moral ground. For Jeremy Corbyn and many others, socialism is an “obvious” response, where caring for one another supersedes the greed and profit-seeking that is always fostered by capitalism. Little further detailed evidence is deemed necessary.
If socialism is “obvious”, then how do we explain the failure of other intelligent people to get on board? If they are not stupid, then they must be acting out of personal malice or greed. They must have sold out their principles in some way. Or they are just plain nasty.
When socialism is seen as “obvious”, its opponents are regarded as stupid or evil. Because the solution is “obvious” there can be no doubt. There is no need to look at evidence, to experiment, to seek wise counsel, or to listen to critics. Those that deny the obvious are deluded, corrupt, or in the pay of those that gain from the existing system.
Hence the claim that “socialism is obvious” encourages a remarkable intolerance of those that take a different view.
Modern economies are highly complex, and to pose any system or solution as “obvious” is a dangerous populist naivety. Precisely because something called socialism has now become popular, we are entitled to ask more precisely what it means.
Socialists compare an imaginary “obvious” world with the real world, with all its poverty, inequality and other problems. They simply assume that their imaginary world of love and cooperation will work. They assume that much can be decided democratically, ignoring the fact that it is impossible to make more than a small fraction of day-to-day decisions democratic. They ignore the problems of incentivizing work and innovation, and of ensuring functional autonomy without private property. All these problems became apparent in real-world socialist experiments in the past.
Socialism and dictatorship
A major problem with large-scale socialism is that a large concentration of political and economic power in the hands of the state undermines the economic foundations of countervailing power and empowers totalitarian forces and outcomes. These problems are illustrated by developments in Russia, China and Venezuela.
Such a centralization of economic power requires and promotes a strong executive, unburdened by checks and balances. When this concentration of economic power is achieved, it reinforces political centralization in the absence of countervailing interests and powers.
The argument that “good” leaders will avoid these pitfalls is spurious. Without checks and balances there are strong temptations to cut constitutional corners. Eventually a “good” leader will be succeeded by someone worse, who will have less scruples about abusing executive power.
The conclusion is that democracy and human rights require countervailing power and a market economy with a much smaller public sector. Countervailing interest groups, with their own access to resources and an ability to check or influence the state, are necessary to prevent democratic abuses and over-centralization.
Ignoring this powerful argument, in the face of extensive historical evidence in its support, is morally reprehensible. It betokens a moral irresponsibility in the light of ample evidence to the contrary. The socialist tenure of the moral high ground is illegitimate.
Conclusion
Instead, the moral high ground should be conceded to those who understand that:
– modern economic systems are highly complex and cannot be largely planned from the centre
– genuine autonomy requires rights to private ownership
– the existence of democracy and the protection of human rights require countervailing politico-economic power
– mixed economies have the best economic performance
– a welfare state is necessary to protect the poor and needy
– instead of chasing unicorns, we should follow the example of those capitalist countries that have the lowest levels of inequality.
18 February 2018
Published January 2018
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I was born in 1946. I lived in a council house until I was 16. My family were Labour. My privilege was not money, but that my parents and grandparents all valued education and culture. But none of them obtained a university degree, because they were less accessible at the time.
Harold Wilson
I became involved in the Labour Party in 1964 and then saw myself as a Tribune socialist following the steps of great radicals such as Michael Foot. After welcoming Harold Wilson’s election victory in 1964, I became critical of the new Prime Minister because of his nominal support for the US in the Vietnam War.
Vietnam and Marxism
For my baby-boom generation, the Vietnam War was a great generator of radicalism. Like many of my university friends, I became a Marxist in 1966. We were drawn into a turbulent and exciting world that combined activism with ideas and debate. I saw myself as a Marxist until about 1980.
I studied mathematics and philosophy from 1965 to 1968 and economics from 1972 to 1974. Both periods were at the University of Manchester. In the intervening years I taught myself Marxist economics. My knowledge of economics became enduringly significant in my political evolution.
I was at the LSE student occupation in 1967 and one of the Grosvenor Square demonstrations in 1968. In that year I copied Bertrand Russell and tore up my Labour Party membership card in protest against US aggression in Vietnam.
Marxists dominated the activists on the university campuses. The left was divided and fractious. There were Soviet Bloc loyalists in the Communist Party of Great Britain. There were lovers of Mao Zedong and several rival Trotskyist sects. I could not bring myself to support any totalitarian regime – East or West – so I joined the forerunner of what is now the Socialist Workers’ Party, which saw everything existing as “capitalist”.
My departure from the SWP came in 1971 when they expelled a dissident faction with which I sympathised. (That critical faction eventually became the Alliance for Workers’ Liberty, of Momentum fame in the Corbyn Era.)
I flirted briefly with the International Marxist Group, which included glamorous figures such as Tariq Ali, and Robin Blackburn of the New Left Review. The IMG was stronger in its support for the women’s movement and for gay rights.
After a few years among the sects I could see that something was wrong. These groups were aiming to help create a much better society, but they were generally dogmatic and intolerant. Some were ruthless, pugnacious and fanatical. I did not want to see any social system facilitated or run by these people.
But on the other hand I then accepted the Marxist view that capitalism was exploitative and frequently led to oppression and war. The evidence of this was seemingly before our eyes.
Re-joining Labour and changing strategy
After Labour’s electoral defeat in 1970, there was a strong and growing left in the Labour Party and that seemed the best hope for socialists. Against the advice of Ralph Miliband (whom I knew personally) and others, I re-joined Labour in 1974.
In 1975 I published a pamphlet entitled Trotsky and Fatalistic Marxism. This tried to explain the fanaticism and intolerance of many Marxists in terms of their belief in the imminent decay and collapse of capitalist democracies. Trotskyists had failed to appreciate the enormous expansion and dynamism of capitalism after 1945. Their explanations of the survival of capitalism were weak.
Published in 1977, a longer work entitled Socialism and Parliamentary Democracy elaborated more of my thinking. Marxist-Leninists believed that parliament and the capitalist state should be “smashed”. Influenced by Max Weber and others, I argued that in modern democracies, government drew their perceived legitimacy from parliamentary elections. If socialism became a majority view, then socialists could and should gain a majority in parliament.
In the book I criticised the 1968 revolutionary movement in France for boycotting the elections called by President Charles de Gaulle in that year. Victory in the elections gave de Gaulle legitimacy. The huge movement of students and workers was crushed.
Paris – May 1968
As I had anticipated, my heresies were dismissed out of hand by the far left sects. But the book proved to be rather influential in the UK and internationally. It received a strongly sympathetic hearing on the Labour left. It was translated into Italian, Japanese, Spanish and Turkish. It persuaded a leading member of the violent Basque separatist group ETA to abandon terrorism.
I don’t know if he read my book, but Daniel Cohn-Bendit, the leader of the revolutionary movement in France in May 1968, later argued that it had been a mistake to boycott the French parliamentary elections.
Labour had been reconciled to the parliamentary road to socialism since its formation. The sects argued that it wouldn’t work. My response was that insurrection would not work either. In democracies we needed a combination of parliamentary and extra-parliamentary action.
Questioning ends as well as means
The killing fields in Cambodia affected me deeply. After seizing power in 1975 the Khmer Rouge forced everyone into the countryside and obliterated about two million people – a quarter of the Cambodian population – in the pursuit of their communist utopia.
I could not dismiss this as an aberration. After all, the Khmer Rouge aims, which included the abolition of money, private property and markets, were central to the Communist Manifesto by Karl Marx and Frederick Engels.
Khmer Rouge Killing Fields
The far left were able to publish papers and debate ideas because they lived in a democracy that tolerated freedom of expression. But the ideas and actions of the sects, if they gained influence or power, would curtail these very liberties upon which they had depended.
Crucially, I was not naïve enough to believe that freedom and political pluralism could be guaranteed simply by the goodwill of a more enlightened Marxist leadership, who valued these things more than the Khmer Rouge. Good intentions were not enough.
I had retained a good lesson from Marxism. Effective ideas and practices draw their strength from agglomerations of power sustained by the structures of the politico-economic system. Hence a genuinely pluralist and tolerant political sphere depended on pluralism and decentralisation in the economic domain. A pluralist polity requires a pluralist economy.
Beatrice & Sidney Webb
Prominent Labour thinkers such as Beatrice Webb, Sidney Webb and G. D. H. Cole had all argued for a decentralised socialist system. But they still sought the abolition of private property and markets. The state would ultimately own everything. So what institutional, legal or other politico-economic forces could stop it retrieving all delegated powers to the centre, when deemed required, or when goodwill wore thin?
Any viable socialism always needs markets
I came to the view that genuine and lasting decentralisation would depend on the existence of organisations with some genuine autonomy and legal independence, providing powers to own property and trade with other organisations. Any viable socialism would always need markets – it was not simply a matter of tolerating or compromising with them.
This crucial transition of my thinking occurred between 1977 and 1980. I cannot recall the detailed influences. But I am sure that the initial impetus did not come from Ludwig von Mises or Friedrich Hayek. I did not delve deeply into their works until the early 1980s.
János Kornai
There had been several socialist proposals to nationalise the sector producing capital goods but retain competition and markets for consumer goods. I was more attracted by the Hungarian economist János Kornai’s more sophisticated proposal (originally published in 1965) to use a dynamic combination of markets and planning, where planning provided strategic impetus, and markets signalled information and gave scope for innovation and planning adjustment.
Over the new year of 1979-1980 I went on a short tourist group visit to the Soviet Union. Some of my companions were dewy-eyed admirers of the system, but I was prepared for its flaws, including the ubiquitous black markets and corruption.
I had been given the address in Moscow of an Englishman married to a Russian. As a former Communist, he explained in detail in his apartment how and why his views had quickly changed: “I challenge any supporter of the Soviet Union to live here just for six months.”
Alec Nove
When Alec Nove published a classic article on feasible socialism in New Left Review in early 1980 I was ready for it. Nove also argued that markets were essential to any viable socialism. He realised that he was attacking deeply-ingrained orthodoxy on the left.
(Later I had the pleasure of meeting both Kornai and Nove several times. Nove died in 1994 but Kornai is still alive. I am delighted to be invited as a keynote speaker at a conference in his honour in Budapest in 2018.)
Labouring as a revisionist
Any acceptance of markets was an anathema to followers of both Karl Marx and Tony Benn. Benn distanced himself from those who supported the persistence of markets.
But I found common ground with Benn and others over what was called “the alternative economic strategy”. I outlined my positive views on this in a pamphlet entitled Socialist Economic Strategy in 1979. It was published by Independent Labour Publications.
Independent Labour Publications was the residue of the old Independent Labour Party, which had played a central role in Labour history from the 1890s to the 1940s. The Independent Labour Party split from the Labour Party in 1931. But in 1975 it formally dissolved as a party and rejoined Labour as Independent Labour Publications.
I was involved in this organisation briefly. Despite outward appearances they turned out to be another sect, lacking any vision of a workable socialism. They too were uneasy about my revisionism. Although my Socialist Economic Strategy was a bestseller by their standards, they refused to reprint it. We parted company in 1981.
Geoff Hodgson, Jean Shepherd & John Maguire in 1979
In 1979 I was the unsuccessful Labour Parliamentary Candidate for Manchester Withington. The seat became Labour in 1987.
I met Benn a few times and supported him in the 1981 deputy leadership election. This alignment was marked in my book Labour at the Crossroads, published in that year. Therein I again supported the alternative economic strategy. But against Benn himself, I argued in that book that in some sectors of the economy “there is no substitute for competition and a market” (p. 206).
(In his important book on The Labour Party’s Political Thought, Geoffrey Foote quotes me (pp. 320, 347) as a “Bennite”. But because of my explicit acceptance of markets, I was unrepresentative of the Bennite stream of thought.)
Subsequently my opinion of Benn shifted. He was a magnificent speaker, but his writings on socialism are vague and unclear. His use of history is unscholarly and cavalier. He was not a well-read intellectual like Michael Foot.
Tony Benn at a Militant meeting
While Benn’s “alternative economic strategy” accepted markets and a private sector for the present, it seemed to me that he wanted to move eventually toward a socialist economy without any markets at all. It was no accident that Benn and his followers defended the Trotskyist sect Militant when they were pushed out of the party from 1985 to 1992.
In 1984 I published my book on The Democratic Economy, where I set out my view on the importance and complementarity of both markets and planning. My argument was framed in socialist language but therein I distanced myself from Marxism. The book received a critical response from many on both the soft and hard left.
The Labour Coordinating Committee
Margaret Thatcher came to power in 1979. One of Thatcher’s most popular policies was to promote the sale of council-owned housing to the tenants. Labour had opposed this policy. The disastrous 1983 defeat of Labour on a Bennite manifesto prompted a rethink, on this and several other issues.
For some of us, this rethink amounted to more than expedient doctrinal trimming. Encouraging home ownership was really a good idea: why should all property be owned by the rich? But while supporting home ownership, we argued that the government should also build more social housing and enlarge the stock available for rent by low-income families.
But these ideas met stiff resistance in the Labour Party ranks, and not simply from Trotskyist entryists such as Militant. The resistance from Benn and his supporters was substantial and even more enduring. It was clear that old-fashioned socialist ideas still had a tenacious appeal among Labour’s membership.
The Labour Coordinating Committee (LCC) became one of the primary modernising forces within Labour. Its leadership included Hilary Benn, Cherie Blair, Mike Gapes, Peter Hain, Harriet Harman, Kate Hoey (the Brexiteer) and others of enduring fame. I was elected to the LCC executive committee. We worked closely with the new leader Neil Kinnock, and with members of his shadow cabinet, including Robin Cook.
Changing Clause Four
I have detailed elsewhere my LCC attempt to bring about discussion to change Labour’s Clause Four. The version that had been in place since 1918 called for the “common ownership of the means of production, distribution and exchange”. This provided for no exception: all production would be in common ownership and there would be no private sector.
Although some Labour Party thinkers began to entertain the possibility of some private enterprise, many party members remained resolutely in support of widespread common ownership.
Against my efforts, the 1983 AGM of the Labour Coordinating Committee defeated the proposal that Clause Four should be rewritten. This was out of fear of antagonising the Benn wing. Instead, the LCC resolved that Clause Four should be “clarified”.
But a resolution on long-term aims, which I had helped to draft, was passed by a large majority. The resolution called for the Labour Party to draft a new statement of aims, upholding “that socialism involves extended democracy and real equality. Democracy under socialism is extended to industry and the community … and must involve a substantial decentralisation of power.”
There was a commitment to “political pluralism” and to “economic pluralism” involving “a variety of forms of common ownership … and the toleration of a small private sector including self-employed workers and other private firms.” The economy must be dominated by mechanisms of “democratic planning … but also accommodating a market mechanism in some areas.”
But there was strong hostility to these mildly revisionist ideas from within Labour’s ranks at the time, including from Jeremy Corbyn and Tony Benn.
Tony Benn & Jeremy Corbyn
The Guardian newspaper reported the LCC conference with the headline: “Labour breaks taboo on ownership”. For a while, the LCC tried to keep the conversation going on the need to revise Labour’s aims. The LCC held a conference in Liverpool in June 1984 on “The Socialist Vision”. But enthusiasm for this discussion fizzled out. By 1985 the LCC’s revisionist initiative had been kicked into the long grass. My efforts had failed.
But to their credit, Neil Kinnock and his deputy Roy Hattersley saw the need for Labour to modernise its aims. I advised them both for a while. But after 1987 I became less active in the Labour Party. My inactivity was born partly out of frustration that it was so difficult to shift Labour from its congenital hostility to markets and private enterprise.
But after a fourth election defeat in 1992 the party became more pliable. Tony Blair was elected as leader in 1994. Blair successfully changed the wording of Clause Four to endorse a strong private sector, but the dramatic rise of Corbyn in the party since 2015 shows that the old collectivist DNA has endured.
Towards liberalism
In many ways I have always been a liberal, especially in my support for freedom of expression, other human rights and democracy. By the late 1970s I also accepted the importance of markets and private property. But the emphasis in my thinking has shifted further in the last 30 years.
My academic works show a few markers of my political evolution. On page xvi of my 1999 book Economics and Utopia I wrote of my common ground with the US liberal John Dewey and with
“British social liberalism, which stretches from John Stuart Mill through Thomas H. Green to John A. Hobson, John Maynard Keynes and William Beveridge.”
These thinkers still inspire me. But I would now also stress the importance of Thomas Paine. Other heroes include George Orwell and Arthur Koestler.
So by 1999 I was a true liberal, of social-democratic stripe. I had already moved some distance from the ideas in my 1984 book, which had over-stressed the possibilities for large-scale planning and for extensive democratic decision-making in large, complex economies.
But I still believe in judicious state intervention and regulation, and I am still an enthusiast for experiments with worker cooperatives and other forms of worker and community participation. With their lower levels of economic inequality, I see the Nordic countries as good role models for in the rest of the capitalist world.
From leaving Labour to joining the Liberal Democrats
In 2001 I left the Labour Party because of Blair’s energetic support for faith schools, Labour’s inadequate proposal for House of Lords reform and its neglect of the problem of economic inequality. I would have left over the Iraq War. Previously I had sometimes voted tactically for the Liberal Party, when they were second behind the Tories in my constituency. But what was tactical was also in growing part a matter of conviction.
I voted Liberal Democrat in the 1997, 2001, 2005 and 2010 general elections. But I did not approve of the coalition with the Tories. So the Liberal Democrats did not get my vote in 2015.
I re-entered political activity in 2016 after the Brexit referendum. My wife (Vinny Logan) had been a critical but close companion on my long journey since 1980. But unlike me she had always voted Labour. After the Brexit vote she joined the Liberal Democrats and I followed her after a few days. It will be a long hard slog to change British politics for the better, but it is vital that we try.
My wife and I were each brought up in a social culture where the Tories and the Establishment were the enemy, and the Liberals were seen as wishy-washy waverers in the class war. Labour was the only game in town.
It takes a long time to remove these ingrained preconceptions and learn that liberalism is the greatest legacy of the Enlightenment. It is the strongest guardian of both prosperity and freedom. Although Liberals have been in a minority, they are largely responsible for the foundation of the British welfare state. The NHS was originally a Liberal proposal. The Liberal Democrats constitute the most pro-EU party in the UK.
But some Liberal Democrats do not understand that it is the job of government in a recession to increase effective demand, particularly by increasing investment and raising disposable incomes for the poor. But the party is a broad church, and I will argue my corner in favour of Keynesian liberal economic policies.
I am a radical liberal. I believe in social solidarity with the less-privileged, as well as in individual rights. As Charles Kennedy showed when he was leader, the Liberal Democrats can succeed when they take principled, radical positions on justice, equality and war.
Today, both the Conservatives (now ruled by deceitful nationalists) and Labour (where the rising hard left dominate the timid moderates) are dangerous threats to the liberal and democratic rights and values that in the past we have taken too much for granted. We must now stand up to defend those rights and values, against dogma, ignorance, intolerance, petty nationalism and deceit.
20 September 2017
Minor edits – 25 September 2017, 22 October 2017, 10 April 2018.
This book elaborates on some of the political issues raised in this blog:
Published by University of Chicago Press in January 2018
Bibliography
Foote, Geoffrey (1997) The Labour Party’s Political Thought: A History, 3rd edn. (London: Palgrave).
Hodgson, Geoffrey M. (1975) Trotsky and Fatalistic Marxism (Nottingham: Spokesman).
Hodgson, Geoffrey M. (1977) Socialism and Parliamentary Democracy (Nottingham: Spokesman).
Hodgson, Geoffrey M. (1979) Socialist Economic Strategy (Leeds: Independent Labour Publications).
Hodgson, Geoffrey M. (1981) Labour at the Crossroads: The Political and Economic Challenge to Labour Party in the 1980s (Oxford: Martin Robertson).
Hodgson, Geoffrey M. (1984) The Democratic Economy: A New Look at Planning, Markets and Power (Harmondsworth: Penguin).
Hodgson, Geoffrey M. (1999) Economics and Utopia: Why the Learning Economy is not the End of History (London and New York: Routledge).
Kornai, János (1965) ‘Mathematical Programming as a Tool of Socialist Economic Planning’, reprinted in Nove, Alec and Nuti, D. M. (eds) (1972) Socialist Economics (Harmondsworth: Penguin), pp. 475-488.
Nove, Alec (1980) ‘The Soviet Economy: Problems and Prospects’, New Left Review, no. 119, January-February, pp. 3-19.
Nove, Alec (1983) The Economics of Feasible Socialism (London: George Allen and Unwin).
Nove, Alec and Nuti, D. M. (eds) (1972) Socialist Economics (Harmondsworth: Penguin).
In terms of basic assumptions, Marxism has more in common with some prominent versions of so-called “neoliberalism” than is generally understood. Obviously, Marxism is opposed to a market economy. But some core ideas by Karl Marx and Frederick Engels are remarkably similar to those of some so-called “neoliberals”. For example, Marx’s definition of property resembles that of Ludwig von Mises.
But the parallels go much further, and are disturbing in their consequences. They concern the independence of the legal system and the nature and legitimation of democracy. They also concern the viability of civil society and the autonomy of personal and social life.
The argument here shows that liberalism – both historically and currently – is very different from some modern versions of “neoliberalism”. This “neoliberalism” is theoretically closer to Karl Marx than to Thomas Paine or John Stuart Mill.
Marxism undermines the autonomy of politics and civil society
The Marxian analysis of capitalism treats law and the state as an expression of class interests, which in turn are grounded on “economic relations”. Hence, for Marx, law and the state “originate in the material conditions of life“. They are part of the “superstructure” built upon the “economic base”.
The Marxist analytical reduction of everything to economics does not stop there. Consider the notion of civil society.
Civil society generally connotes a realm of free, partly self-organising, property-owning citizens, who interact under the rule of the state and its laws. In most accounts it includes private business and markets, but it is not reducible to them. It also embraces many forms of social association (including recreation, religion and philanthropy) that are not driven by business interests.
Thomas Paine
Distinctions between civil society and the state, and between civil society and the narrower world of trade and business, were developed by Enlightenment liberal writers such as Adam Smith, Adam Ferguson, Thomas Paine, Alexis de Tocqueville and others. They are crucial for modern liberal theory.
In its analysis of capitalism, Marxism made the state, law, politics and civil society all analytically subservient to markets and business.
These may be regarded as extreme formulations within Marxism. Certainly there are more sophisticated treatments by Marxists of civil society and the state, not least by Antonio Gramsci. But Marxism is severely impaired by the words of its founders.
The above extracts concern the Marxian analysis of capitalism, not its vision of an ideal society, which of course is strikingly different from that of (neo)liberals. While the Marxian analysis of capitalism undermines the conceptual distinction between civil society and the state – by making them both subservient to economic relations – Marxian politics also dissolves it in practice.
In his early tract On the Jewish Question, Marx argued that civil society and political society should become one and the same. In practice, under socialism, once much of the economy becomes a state bureaucracy. With private association under restriction, the scope of civil society is much diminished.
The reclamation of civil society by Eastern European dissidents
Long before the fall of the Berlin Wall in 1989, underground opposition groups had developed in several Soviet Bloc countries. After the crushing of the Hungarian Uprising in 1956, and after the Soviet invasion of Czechoslovakia in 1968, opposition to the Marxist party-state became most developed in Poland.
Leszek Kolakowski
In 1971 the Polish intellectual Leszek Kołakowski wrote his Theses on Hope and Despair. These were circulated illegally in his home country.
Kołakowski complained that the Soviet-style regime had “monopolistic power” that impelled “the atomization of society and the destruction of all forms of social life not prescribed by the ruling apparat.” He called for a pluralist society with genuine freedom of information, discussion and association.
Subsequently, other Eastern European intellectuals such as Jacques Rupnik called for “the rebirth of civil society”. After the formation of the mass trade union movement Solidarity in Poland in 1980, still more voices were added. The Hungarian Andrew Arato wrote in 1981 of the new dissident wave:
“one point unites them all: the viewpoint of civil society against the state – the desire to institutionalize and preserve the new level of social independence.”
Before its unexpected elevation to political power in 1989, Solidarity saw itself as essentially a movement for the “self-defence” of civil society against totalitarian power.
But while the dissidents drew on Enlightenment and liberal thought, their political philosophy was often underdeveloped. After 1989, many former dissidents became influenced by extreme forms of market libertarianism. But given the parallels – explored below – between this “neoliberalism” and Marxist thought, there was more continuity in their thinking than immediately meets the eye.
Market universalism
To understand the connection between “neoliberalism” and Marxism we need first to address a much broader phenomenon within social science.
There is a widespread tendency to use the language of trade and markets to describe phenomena that are neither traded nor markets. I gave some examples in my Conceptualizing Capitalism book. I here call it market universalism.
Consider the notion of a “market for ideas”, which can be found in the writings of Nobel Laureate Ronald Coase. He did not refer to intellectual property but to conversation and freedom of expression.
Douglass North, another Nobel Laureate, wrote of “political markets”. He was not referring to vote-buying (in countries like India) or political bribery, but to the general process of multi-party competition in a democracy.
In a paper published in 1988, Bruce Benson and Eric Engen envisioned “the legislative process as a market for laws” where interest groups “pay” legislators for laws as “products”.
By minimal criteria, none of these is a market. Rules concerning contracts, enforcement and property rights are lacking.
For example, the ordinary communication or debating of ideas does not involve enforceable contracts. Generally, conversation is not an intentional transfer of property rights.
Similarly, if we vote for a politician or a party that does not typically amount to an enforceable agreement. Competition between politicians or parties for votes or power is not a contest for contracts under any established system of contractual rules.
Likewise, with the supposed “market for laws”, in reality there are rarely any enforceable contracts between interest groups and legislators.
There is a further problem. What would be the system of rules under which these supposed “contracts” between legislators and interest groups are formed and enforced? Hence a “market for laws” would require supra-legal institutions with their own (legal or other) rules. We would need markets for markets-for-laws, or markets for meta-rules.
This reveals a problem of an infinite regress, showing that not everything can be placed on a market. My Conceptualizing Capitalism book gives further reasons why markets cannot be universal. There will always be missing markets.
Market universalism and “neoliberalism”
Although market universalism may be dismissed as the harmless use of metaphor, it contains dangerous policy temptations.
Making everything a market denies the autonomy of law and politics: everything is subsumed within the market zone. All forms of association are regarded as market-like or contractual arrangements. Legal and political relations or rights are reduced to the “economic” facts of possession or control.
The temptation is to downgrade all non-commercial justifications for democracy, law or social life. Everything is forced into the conceptual straitjacket of property and contract, and evaluated in terms of profit and loss.
Previous liberal thinkers had defended rights to private property, other human rights, plus institutions such as democracy. By contrast, market universalism can highlight control over property first, on the grounds that it is the foundation of all other rights and liberties. Property moves from being a necessary but insufficient condition of liberty, to being necessary and sufficient for the same.
This transforms the Enlightenment argument that the government must be legitimated by representative democracy, rather than by tradition or divine rule. The “political market” makes democracy a market, and market-like criteria become the overriding source of legitimation for everything.
Furthermore, democracy may be seen as secondary or expedient, especially when property or markets are perceived as being under threat. By treating democracy as another market, a temptation is to regard markets and property as generally more important or supreme than democracy.
Consequentially, market universalism enables something very different from other forms of liberalism, and it involves a radically modified conceptual foundation. One may be tempted to call it neoliberalism.
This is the label suggested by Philip Mirowski, who addressed what he called the Mont Pèlerin “thought collective”. In a perceptive essay on this influential intellectual movement, which involved Friedrich Hayek, Milton Friedman, Ludwig von Mises and others, Mirowski identified several of its traits including the following:
“Skepticism about the lack of control of democracy is offset by the persistent need to provide a more reliable source of popular legitimacy for the neoliberal market state. Neoliberals seek to transcend the intolerable contradiction by treating politics as if it were a market and promoting an economic theory of democracy.”
We can now see what Marxists and market universalists have in common. They all look upon capitalism as system where everything is reducible to a market.
For Marxists, this means that civil society is nothing more than the sphere of business and individual greed. In addition, the political and legal spheres are simply reflections of these business interests.
A policy consequence – after the socialist revolution – is to destroy civil society and absorb it into politics and the state. This forms part of the Marxist foundation for totalitarianism.
Of course, for “neoliberals”, markets are always beneficial. But the problem is much more serious than their ever-familiar agoraphilia.
Through notions such as “political markets” and “markets for laws”, market universalist “neoliberals” reduce the state and its legal system to a grand marketplace. The state and law become additional markets alongside others. The policy temptation is the practical marketization of the state and the doctrinal denial of the autonomy of politics.
Once politics and all civil society are seen through the lenses of trade and markets, then the basic elements of property and contract become supreme. Instead of being a necessary but insufficient precondition of liberty, property becomes both necessary and sufficient.
This transforms the Enlightenment argument that the government must be legitimated by representative democracy, rather than by divine rule. The “political market” makes democracy a market, and this becomes the overriding source of legitimation.
Consequently, democracy becomes secondary or expedient, especially when property or markets are perceived as being under threat. By treating democracy as another market, a temptation is to regard markets and property as generally more important or supreme than democracy.
Leading “neoliberals” like von Mises and Hayek have been described as classical liberals. But their views are a departure in important respects from the Enlightenment liberalism of the eighteenth and nineteenth centuries, and from other more recent currents of liberal thinking. In some important respect they are closer to Karl Marx than John Stuart Mill.
Margaret Thatcher and Augusto Pinochet
Their supreme emphasis on property rights explains why some “neoliberals” have dallied with dictators. For example, in a book originally published in 1927, von Mises praised fascism as “an emergency makeshift” that “has, for the moment, saved European civilization”. Hayek was notoriously silent about the human rights violations in Chile under the dictator Pinochet. These fascist or dictatorial regimes were seen by them as saviours of private property.
Conclusion: liberalism is not “neoliberalism”
Despite their opposed policy stances, Marxism and the type of market-universalist “neoliberalism” discussed here have similarities at their theoretical foundations. While Marxism reduces the analysis of civil society and politics to an economistic world dominated by self-seeking egoists, this “neoliberalism” does exactly the same.
Within this version of “neoliberalism”, everything is legitimated by free contract in unfettered markets in all spheres of human interaction, including within the state itself. Like Marxism, it reduces everything to economics.
This entails a radical break from other forms of liberalism, and from all other doctrines that recognise the relative autonomy of the political and legal spheres from the economy and from civil society.
2 September 2017
Minor edits – 8, 10 September 2017
This book elaborates on some of the political issues raised in this blog:
Published by University of Chicago Press in January 2018
References
Arato, Andrew and Cohen, Jean (1992) Civil Society and Democratic Theory (Cambridge, MA: MIT Press).
Benson, Bruce L. and Engen, Eric M. (1988) ‘The Market for Laws: An Economic Analysis of Legislation’, Southern Economic Journal, 54(3), January, pp. 732-745.
Caldwell, Bruce J. and Montes, Leonidas (2015) ‘Friedrich Hayek and his Visits to Chile’, Review of Austrian Economics, 28(3), pp. 261-309.
Cohen, Jean (1982) Class and Civil Society: The Limits of Marxian Critical Theory (Oxford, Martin Robertson).
Keane, John (ed.) (1988) Civil Society and the State (London: Verso).
Keane, John (1995) Tom Paine: A Political Life (London: Bloomsbury).
Keane, John (1998) Civil Society: Old Images, New Visions (Cambridge: Polity).
Kumar, Krishan (1993) ‘Civil Society: An Inquiry into the Usefulness of an Historical Term’, British Journal of Sociology, 44(3), September, pp. 375-395.
Mirowski, Philip and Plehwe, Dieter (eds) (2015) The Road from Mont Pèlerin: The Making of the Neoliberal Thought Collective, paperback edition (Cambridge MA: Harvard University Press). (Quote from p. xvii.)
Mises, Ludwig von (1985) Liberalism in the Classic Tradition. Translated from the German edition of 1927 (Irvington, NY: Foundation for Economic Education).
Polan, Anthony J. (1984) Lenin and the End of Politics (London: Methuen).
The world is full of injustice and poverty, while the rich protect their wealth by manipulating the system of power. Consequently, many of the informed and intelligent are lured like moths to the lights of socialist revolution, promising social justice for the many not the few.
Vladimir Ilyich Lenin was a blazing light in Russia a century ago. Many intellectuals were attracted to his Soviet regime. Lenin is said to have coined the term “useful idiot” to describe the naïve among them (but no evidence has been found to support that attribution).
But in 1913 Lenin definitely did quote the old adage that “the road to hell is paved with good intentions”. This was unwittingly self-referential and rather prophetic. Lenin’s post-1917 Bolshevik regime became a hell, in part of his own making. The good-intentioned (with sufficient means or influence) were invited from abroad to visit the young Soviet Republic.
Venezuela – “another world is possible”
But first let us consider the current case of Venezuela. Its experiment in radical socialism began in 1998 when Marxist Hugo Chávez was elected as President. Using the plentiful oil revenues during 1999-2007, his government expanded access to food, housing, healthcare, and education, especially for the poor and the indigenous minorities.
Hugo Chávez
Chávez nationalized key industries and created participatory Communal Councils. He whipped up popular support against the rich elite and their perceived allies in the United States. But constitutional checks and balances slowed down his radical reforms. Criticism from the private press and political opposition countered the populist movement.
So in 1999, the new Constitutional Assembly, filled with elected supporters of Chávez, drafted a new constitution that made censorship easier and granted the executive branch of government more power.
The Constitutional Assembly extended the presidential term. It abolished the two houses of Congress. It also granted Chávez the power to legislate on citizen rights, to promote military officers and to oversee economic and financial matters.
In 2002 Chávez was briefly deposed in a coup, which probably had support from the CIA. But Chávez was restored to power by the army and popular mobilisations.
Chávez then seized control of the courts and the electoral authority, and suppressed much of the opposition media. He removed political checks and balances, seeing them as obstacles to his socialist revolution.
Accordingly, the device of populist democracy was used to push the country in the direction of dictatorship. His supporters were persuaded to approve increases in presidential powers, to protect the “socialist revolution” against its enemies. Since 2004, “defamation” of the government, including “disrespect for the authorities”, has been a criminal offence.
Chávez failed to diversify the economy and reduce its reliance on oil. He antagonised private investors. The state-centred economy was not robust enough to withstand the post-2008 oil price collapse.
Venezuela’s descent into hell
In a state-run economy, business corruption is encouraged by bureaucratic failure. Political corruption is facilitated by the gathering of powers in the hands of the ruling party and the state machine. The Venezuelan government became one of the most corrupt in the world. Serious shortages of food and medicine emerged.
“There’s no food”
Chávez died of cancer in 2013 and was replaced as President by Nicolás Maduro.
In 2015 and 2016, blaming internal “fascists” and US intervention for the severe shortages, President Maduro declared two states of emergency. These gave him powers to intervene in the economy. Arbitrary detentions of dissidents became more common.
The regimes of Chávez and Maduro wasted and misspent much of the money made in the oil boom, while over-extending the powers of their corrupt governments. The private sector was hobbled. The ultimate outcome of Venezuela’s experiment with populist socialism has been authoritarianism, destitution and starvation.
Because of a populist mistrust of liberal, pluralist institutions, Venezuela is lurching toward dictatorship. Press freedom is limited and critical journalists and opposition leaders are jailed.
Supporters of Chávez and Maduro blame the hostility of the US for Venezuela’s distress, just as it was blamed for economic problems in Cuba after its 1959 revolution. US belligerence made things worse, and will probably continue to do so.
But the major cause of economic stagnation in Cuba and Venezuela is the unchecked concentration of excessive political, legal and economic power in the hands of the overbearing state.
“we celebrate, and it is a cause for celebration, the achievements of Venezuela, in jobs, in housing, in health, in education, but above all its role in the whole world … we recognise what they have achieved.”
Corbyn has since been challenged to come out against the hellish Maduro regime. Maduro’s government has been accused of arbitrary arrest, extra-judicial killings and torture.
Jeremy Corbyn and Hugo Chávez
Having managed to dupe many people with the mantra that he was a “peacemaker” in Northern Ireland (rather than a supporter of the IRA), Corbyn tried the same trick with Venezuela.
First he removed all mention of “Venezuela” from his website. Then, in an August 2017 interview, he condemned the “violence done by all sides”.
The Venezuelan opposition includes both rightist agitators and defenders of human rights. By simply condemning violence, Corbyn appeared as morally neutral between the regime and its diverse opponents. He ignored the politico-economic conditions that had given rise to the violence, and the previous actions of the Chavistas in creating them.
I wonder if Corbyn could be taken back in a time machine to the 1793-94 Terror of the French Revolution, or the Soviet Great Terror of the 1930s, or the occasion of Hitler’s invasion of the Sudetenland in 1938, and be asked to condemn with detached neutrality the “violence done by all sides”.
In the same interview Corbyn called for respect for “the independence of the judiciary and … the human rights of all”. He failed to note that Chávez and Maduro were primarily responsible for undermining both.
Questioned about his support for Maduro, Corbyn fudged:
“I gave the support of many people around the world for the principle of a government that was dedicated towards reducing inequality and improving the life chances of the poorest people.”
He omitted to mention that that same socialist Venezuelan government was now responsible for widespread starvation, rampant corruption and mass emigration.
But Jeremy of Islington is in search of socialist sainthood. He does not want the blood of any regime on his hands. He wants to go down as a peacemaker. He left it to his Corbynista Praetorian Guard to make a more forceful case for the Chávez-Maduro regime.
Over to the Corbynistas
Labour MP Chris Williamson tweeted on 11 August 2017 that the violence in Venezuela is “for the purpose of overthrowing democracy, not saving it”. Unlike Corbyn, this blamed all the violence on the opposition. It also overlooked the fact that Chávez and Maduro had been more effective in undermining democracy in Venezuela than anyone else.
Chris Williamson MP & Jeremy Corbyn MP
On the following day, Williamson Tweeted: “The US and global corporations are indulging in economic sabotage in Venezuela to bring down the government”. To a degree this may be true. But the statement ignores the greater part played by Chavista populism and its power-grabbing statist socialism in bringing about the economic and political catastrophe.
Other pro-Chavista idiotas útiles include Alexis Tsipras the Greek Prime Minister, Pablo Iglesias of Podemos in Spain, Jean-Luc Mélenchon the leftist French presidential candidate, Pope Francis and the Five-Star Movement in Italy.
The erosion of civil liberties and human rights has its roots in the concentration of economic and political powers in the hands of the state, whatever the “good intentions” that originally motivated the leaders and their supporters.
Stalin the Fabian and the Stalinist Fabians
Sadly, this is an old pattern. The Fabian socialist George Bernard Shaw visited the Soviet Union in 1931 and met Joseph Stalin. Shaw declared that Russia was becoming “a Fabian society”. This was at a time of mass famine and forced collectivisation.
George Bernard Shaw
In the preface to his 1933 play On the Rocks, Shaw defended the Russian secret police’s “liquidation” of detainees who could not give satisfactory answers to queries about “pulling your weight in the social boat” or “giving more trouble than you are worth” or had not “earned the privilege of living in a civilized community”.
In a letter published in the Manchester Guardian in 1933, Shaw and others dismissed reports of famine in the Soviet Union as “slander” resulting from a “lie campaign” against the “Workers Republic of Russia”. In fact, from 1932 to 1933, about six to eight million people died there from hunger.
Shaw subsequently attempted to justify the extermination of the Russian peasantry: “For a Communist Utopia we need a population of Utopians. Peasants will not do.” In 1936 Shaw defended Stalin’s purges and mass executions. In 1948 he declared that Stalin was “a first rate Fabian”.
Beatrice & Sidney Webb
Leading Fabians Sidney and Beatrice Webb were highly influential intellectuals in the British Labour Party. In 1932 they made a three-week visit to the Soviet Union. Their generally favourable impressions were reported in 1935 in their massive two-volume study, Soviet Communism: A New Civilisation? In the 1937 edition the question mark was removed from the title.
Their assessments of the Soviet Union were more cautious than those of Shaw, but they also denied the existence of a famine in the Ukraine in 1932-1933 and they opined that the liquidation of rich peasants (kulaks) may have been necessary to collectivize agriculture and increase its productivity. Their book received favourable reviews from left writers and it played a role in nurturing sympathy in the Labour Party for the Soviet Union, at least until the onset of the Cold War in 1948.
“Humane” Mao and the “Korean miracle”
Communism achieved another victory when Mao Zedong came to power in China in 1949. Professor Joan Robinson was a leading Cambridge economist, influenced by both Karl Marx and John Maynard Keynes. An enthusiastic supporter of Mao, she visited China several times.
Despite this first-hand experience, she failed to acknowledge that Mao’s Great Leap Forward in 1958-1961 had been an economic disaster: it had led to catastrophic famine and about 40 million deaths. In defiance she wrote: “the Great Leap [Forward] was not a failure after all, but the Rightists were reluctant to admit it.”
Joan Robinson
In the 1960s Robinson lauded the Cultural Revolution, approving of attempts by Mao and the Red Guards to root out “capitalist roaders” within Chinese society. She praised Mao’s “moderate and humane” intentions. In fact, the Cultural Revolution led to at least half a million and perhaps as many as two million deaths.
Violent struggles ensued across the country and paralyzed the economy for years. Many more millions of people were persecuted at whim by the Red Guards: they suffered public humiliation, arbitrary imprisonment, torture or execution. Countless more died when the army tried to re-establish order. In China’s totalitarian system they had no refuge or legal protection.
As late as 1973 Robinson opposed “market socialism” and advocated a centrally-planned economy. She wrote of the “success of the Chinese economy in reducing the appeal of the money motive”. After extolling the virtues of Mao’s system, she reported that “Chinese patriotism and socialist ideology are pulling together”.
But a few years later, shortly after Mao’s death in 1976, the country overturned the anti-market policies that Robinson had celebrated in her writings. After accepting markets, Chinese growth took off.
In 1964 Robinson visited Communist North Korea and extolled the “Korean miracle” in its economy. She attributed its claimed success to public ownership and central planning.
But, within fifteen years, capitalist South Korea was surging ahead of its Northern neighbour. By the 1990s North Korea was experiencing mass famines. By 2010, GDP per capita in the South was about 17 times greater than in the North.
The “human face” of Soviet Communism
E P Thompson
The historian Edward P. Thompson left the British Communist Party after the 1956 Hungarian Uprising and subsequently played a major part in the formation of the New Left Review. But as late as 1973 he had sufficient residual sentimentalism for the Soviet Union to write of the
“times when [Soviet] communism has shown a most human face, between 1917 and the early 1920s, and again from the battle of Stalingrad to 1946.”
Leszek Kolakowski
Leszek Kolakowski’s response to these rose-tinted words was devastating. He asked what Thompson might have meant by the “human face” of the Soviet Union during these years. Did it mean the “attempt to rule the entire economy by police and army, resulting in mass hunger with uncountable victims, in several hundred peasants” revolts, all drowned in blood”?
“Or do you mean the armed invasion of seven non-Russian countries which had formed their independent governments …? Or do you mean the dispersion by soldiers of the only democratically elected Parliament in Russian history …? The suppression by violence of all political parties, including socialist ones, the abolition of the non-Bolshevik press and, above all, the replacement of law with the absolute power of the party and its police in killing, torturing and imprisoning anybody they wanted? … And what is the most human face in 1942-46? Do you mean the deportation of eight entire nationalities of the Soviet Union with hundreds of thousands of victims … ? Do you mean sending to concentration camps hundreds of thousands of Soviet prisoners of war handed over by the Allies?”
Kolakowski searched for an explanation of Thompson’s incredible description of these events as “a most human face” of Communism. Perhaps this phrase is being used “in a very Thompsonian sense which I do not grasp”? A commentator on Kolakowski’s response wrote: “no one who reads it will ever take E. P. Thompson seriously again.”
Another “distortion”: the killing fields of Cambodia
Robinson and Thompson were not the only top-rank academics to be deluded by ideology. Consider the most important linguist of the twentieth century. Noam Chomsky loathed the American war in Vietnam. For him, to hide its own acts of oppression and mass murder, the West had duped the masses with its slick corporate propaganda. The West was fascism, with a fake mask of democracy.
Noam Chomsky
But when reports emerged that the Communists were also capable of mass atrocities, he suspected an American conspiracy to exaggerate and to draw attention away from their own crimes. Then the evidence emerged of the killing fields of the Khmer Rouge in 1975-1979. Chomsky accused the publishers of the evidence of “extreme anti-Khmer Rouge distortions”.
Khmer Rouge Killing Fields
We now know that the Khmer Rouge obliterated about two million people – a quarter of the Cambodian population – in the pursuit of their Communist utopia. Chomsky’s reputation as a political thinker has never recovered.
Conclusion: what can we learn?
The first lesson is that thousands of highly intelligent people can be political idiots. We know that unintelligent people can be idiots (and even become presidents) but the task at hand is to explain intelligent idiocy. All it takes is a good dose of utopian idealism, combined with the view that the existing system is beyond reform.
Then when the likes of Lenin, or Mao, or Kim Il-sung, or Castro, or Pol Pot, or Chávez raise the red flag, the utopian intellectual flies to the light. A dose of reality may burn the wings. But the light of intellectual hope is so important that it must remained undimmed. Consequently, events as big as famines are based on the dark capitalist forces outside, or their devious agents within.
Many intellectuals are not practical people. They have lingered in their ivory towers. They know little of running organizations or state bureaucracies. Because of their well-motivated discontent and their search for hope, they can be attracted to Corbynism and other versions of leftist populism. But those lights are dangerous. They are ignited by opposition: without practical experience or feasible solutions.
Given such centralized powers, even well-motivated leaders will be tempted to curtail dissent and bully minority interests, in the name of the many against the few. Once on this slippery slope, human rights are eroded and the politico-economic system slides toward totalitarianism.
Instead we need to look to ways to making capitalism more egalitarian and inclusive, rather than chasing the dangerous dream of its abolition. Intelligent dreamers need to use their intelligence more wisely.
14 August 2017
Minor edits – 16, 20 August 2017, 27 September, 13 December 2017
This book elaborates on some of the political issues raised in this blog:
Published by University of Chicago Press in January 2018
Bibliography
Barsky, Robert F. (1997) Noam Chomsky: A Life of Dissent (Cambridge, MA: MIT Press).
Hollander, Paul (1998) Bernard Shaw: A Brief Biography (Philadelphia: University of Pennsylvania Press).
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Judt, Tony (2006) ‘Goodbye to All That?’ New York Review of Books, 21 September 2006.
Kolakowski, Leszek (1974) ‘My Correct Views on Everything: A Rejoinder to Edward Thompson’s “Open Letter to Leszek Kolakowski”’, Socialist Register 11. See pp. 4-5. Available at http://socialistregister.com/index.php/srv/article/view/5323/2224#.VXBUKrFwYy8.
Minney, Rubeigh J. (1969) The Bogus Image of Bernard Shaw (London: Frewin).
Robinson, Joan (1969) The Cultural Revolution in China (Harmondsworth: Penguin). See pp. 19, 35-36.
Robinson, Joan (1973) Economic Management in China 1972 (London: Anglo-Chinese Educational Institute). See pp. 4, 13, 37.
Shaw, George Bernard (1934) Prefaces by Bernard Shaw (London: Odhams Press). See p. 341.
Thompson, Edward P. (1973) ‘An Open Letter to Leszek Kolakowski’, Socialist Register 10. See p. 77, emphasis added. Accessible on http://socialistregister.com/index.php/srv/article/view/5351#.VXBrZLFwYy8.
Turner, Marjorie S. (1989) Joan Robinson and the Americans (Armonk NY: M. E. Sharpe). See p. 90.
Webb, Sidney J. and Webb, Beatrice (1935) Soviet Communism: A New Civilisation? (London: Longmans Green).
Some say that it never was “proper socialism” in the first place, for some reason, such as the failure to establish worker control of the factories, or the dissolution of democratic government. These purists move rapidly to Step 7, collect their £200, and move back to Step 1.
Bernie Sanders campaigned for the Democratic presidential nomination in the US in 2015-2016. In the primary elections he received over thirteen million votes. He won 23 primaries and caucuses and approximately 43 per cent of pledged delegates, compared to 55 per cent for Hillary Clinton.
Sanders is not alone in sometimes hiding his socialism behind the word democracy. Michael Moore did it in his ironically-titled 2009 film Capitalism: A Love Story, where he argued that
Going further back, as a young man in Chicago in the 1960s, Sanders was a member of the Young People’s Socialist League, which was the youth wing of the Socialist Party of America.
Socialism raises the moral flag because it claims to be the creed of love, care and cooperation. By contrast, it is argued, capitalism and markets encourage selfishness and greed.
So the argument goes. But the evidence tells a different story. The socialists, the “greed is good” defenders of capitalism, and believers in our total selfishness are all wrong.
Such a centralization of economic power requires and promotes a strong executive, unburdened by checks and balances. When this concentration of economic power is achieved, it reinforces political centralization in the absence of countervailing interests and powers.
I was at the LSE student occupation in 1967 and one of the Grosvenor Square demonstrations in 1968. In that year I copied Bertrand Russell and tore up my Labour Party membership card in protest against US aggression in Vietnam.
I am a radical liberal. I believe in social solidarity with the less-privileged, as well as in individual rights. As Charles Kennedy showed when he was leader, the Liberal Democrats can succeed when they take principled, radical positions on justice, equality and war.
The conceptual and practical degradation of civil society is but one of the roots of totalitarianism within Marxism. 
Subsequently, other Eastern European intellectuals such as Jacques Rupnik called for “the rebirth of civil society”. After the formation of the mass trade union movement Solidarity in Poland in 1980, still more voices were added. The Hungarian Andrew Arato wrote in 1981 of the new dissident wave:
There is a widespread tendency to use the language of trade and markets to describe phenomena that are neither traded nor markets. I gave some examples in my 
This transforms the Enlightenment argument that the government must be legitimated by representative democracy, rather than by tradition or divine rule. The “political market” makes democracy a market, and market-like criteria become the overriding source of legitimation for everything.
Through notions such as “political markets” and “markets for laws”, market universalist “neoliberals” reduce the state and its legal system to a grand marketplace. The state and law become additional markets alongside others. The policy temptation is the practical marketization of the state and the doctrinal denial of the autonomy of politics.
As late as 1973 Robinson opposed “market socialism” and advocated a centrally-planned economy. She wrote of the “success of the Chinese economy in reducing the appeal of the money motive”. After extolling the virtues of Mao’s system, she reported that “Chinese patriotism and socialist ideology are pulling together”.
