Socialism is a political and economic system in which there is public (no private) ownership or control of property and natural resources. It believes that every person in the community has an equal share of the various elements of production, distribution, and exchange of resources. According to the socialist view, individuals do not live or work in isolation but live in cooperation with one another.
Socialists take into account both individual needs and greater social needs. Examples of greater social needs include transportation, education, healthcare, and defense.
The mantra of socialism is From each according to his ability, to each according to his contribution. This means everyone in society receives a share of the production based on how much each has contributed. For this reason, individuals in a socialistic society tend to work very hard in order to receive more. Workers receive their share of production after a percentage has been deducted for the common good.
The common good is a term that is interpreted to mean taking care of people who can't contribute to social development, such as children, caretakers, and the elderly.
Some core ideas of socialism are:
a. Collectivitism - Human society will be strongest when there is collective action by all humanity toward a greater good. Politics, economics, and social reform should benefit society, not individuals. There should be wealth redistribution to equalize society.
b. Common humanity - Humans are naturally social. Individuals are shaped by society and capitalism has corrupted natural social tendencies.
c. Equality - Belief that people are not born equal. Focus on equality of outcome, rather than on opportunity.
d. Social class - Society is divided into classes based on how money is earned and professions with higher classes benefiting at the expense of the lower
e. Workers' control - Those who produce should control the means of production. A strong state is necessary to achieve a socialist state, but that state should be governed by the workers.
A prominent historical example of a socialist country is the Soviet Union.
Today, there are no countries that are pure socialist. Cuba, China, and North Korea have strong elements of socialist market economies.
Early capitalism had brought economic inequality in society. By the turn of the 19th century, the industrial revolution and capitalism had led to inhumane working conditions. Workers were paid extremely low wages and no rights. They worked extremely long hours with zero safety provisions. The elite class of capitalists grew richer and the working class became poorer.
Socialism arose as a reaction to these injustices of capitalism and the industrial revolution.
By the mid-19th century, trade unions began to be formed.
A German philosopher named Karl Marx started writing about the shortcomings of capitalism and the exploitation that resulted from it. He believed that in an industrial society it is the workers who worked hard to generate wealth, but this wealth went to the hands of a few capitalists instead of going back to the workers for their hard work. He said that the condition of workers would never improve till the profit is taken by the capitalists. Marx believed that to free themselves from the capitalists’ exploitation, workers had to form a socialist society where all property was socially controlled. Through his writings, he advocated for a revolution that would see the working class collectively own the means of production.
Following Marx’s writings, various countries started experimenting with various versions of socialism.
These can be distinguished based on rights to property, as well as control of the production process.
Under a capitalistic economy, enterprises and private individuals control the means of production, together with all the profits. Under a socialistic structure, a central authority controls the resources used in the production process. Private property is unheard of, but where it exists, it is in the form of consumer products.
While a capitalistic system is dependent on the decisions of independent persons who influence the production process, a socialistic structure controls the production process by regulating the market system.
| Capitalism | Socialism | |
| Means of production | Means of production owned by private individuals | Means of production owned by government or cooperatives |
| Income equality | Income determined by free-market forces | Income is equally distributed according to need |
| Consumer prices | Prices determined by supply and demand | Prices set by the government |
| Efficiency and Innovation | The free market competition encourages efficiency and innovation | Government-owned businesses have less incentive for efficiency and innovation |
| Healthcare | Healthcare provided by the private sector | Healthcare provided free or subsidized by the government |
| Taxation | Limited taxes based on individual income | High taxes necessary to pay for public services |
Yes. The main difference is that socialism is compatible with democracy and liberty, whereas Communism involves creating an 'equal society' through an authoritarian state, which denies basic liberties.
Some of the characteristics of socialism include:
1. Public ownership - The means of production and distribution are owned, controlled and regulated by the public, either through the state or through cooperatives. The basic motive is not to use the means of production for profit, but rather for the interest of social welfare.
2. Economic planning - A socialist economy is not driven by the laws of supply and demand. All economic activities are planned and coordinated by a central planning authority which is usually the government.
3. Egalitarian society - Socialism aims for an egalitarian society where there are no classes. Ideally, all the people within a socialist economy should have economic equality.
4. Provision of basic needs - In a socialist economy, the basic needs – food, shelter, clothing, education, health and employment – are provided by the government without any discrimination. However, this can result in the people thinking that they cannot survive without the government, creating a perfect environment for the rise of authoritarian governments.
5. No competition - There is no competition in the market since the state is the sole entrepreneur. For any product, there will be only one basic type of any product. So, one cannot choose from different brands. For example, when you want to buy a car, you can choose from different brands and models. But in a socialist economy, there will be only one car in the market to serve the basic need of transportation. The state only focuses on the provision of necessities, which results in limited consumer choice.
6. Price control - In socialists economies, the prices of products are controlled and regulated by the state. The state (or government) sets both the market price for consumer goods and the accounting price which helps managers make decisions about the production of goods.
7. Social welfare - Under a socialist system, there is no exploitation of the workers. The state takes care of the working class through employment protection, minimum wages, and trade union recognition rights.
1. Democratic socialism - This is a socialist economy in which the means of production are socially and collectively owned or controlled, alongside a democratic government.
2. Market socialism - The means of production is owned by workers. Goods produced are distributed among the workers, while any excess production is sold on the free market. In this kind of socialism, production and consumption are controlled and regulated by market forces instead of the state.
3. Authoritarian state socialism - This is an extreme type of socialism where all means of production are owned and controlled by the state. It advocates for strict obedience to the state by the people, even if that means they should forego their rights.
4. Revolutionary socialism - It believes that it is impossible to instill social change peacefully and the transition from capitalism to socialism can only happen through a revolution.
5. Utopian socialism - It is used to refer to the first wave of modern socialism. It is often described as the presentation of visions and outlines for imaginary or futuristic ideal societies, with positive ideals being the main reason for moving the society in such a direction. The problems with Utopian socialism are that it does not concern itself with how to get there, therefore, it cannot be achieved in reality. It is more of a vision than a concrete plan.
6. Libertarian socialism - It is also known as free socialism or anti-authoritarian socialism because it believes that centralized state ownership and control of the economy are unnecessary. Instead, it advocates for the ability of people to directly control the institutions that control them such as schools, workplaces, community, and culture.
7. Religious socialism - It is based on religious values. Many religious values about human society are aligned with socialist ideas and have been used to advocate for socialism. Any form of socialism that developed within a religion can be termed as religious socialism.
8. Green socialism - It merges socialist thought with green politics and advocates for the preservation of natural resources.
9. Fabian socialism - It advocates for the achievement of democratic socialism through gradual reforms and other peaceful means, rather than through revolution.
Advantages and Disadvantages of socialism
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Disadvantages
