The vital distinction between social democracy and socialism
Geoffrey M. Hodgson
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.
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.
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
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
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.
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
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
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.
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.
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.
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
“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.
There is a simple test to distinguish a socialist from a social democrat, according to currently prevalent meanings of those
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
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
Jay, Douglas (1937) The
Socialist Case, 1st edn. (London: Faber and Faber).