Articles in Monthly Review often end by invoking the socialist alternative to capitalism. Readers in recent years have frequently asked us what this means. Didn’t socialism die in the twentieth century? Wasn’t it defeated by capitalism? More practically: if socialism is still being advocated what kind of socialism is it? Are we being utopian in the sense of advancing a pleasant but impossible dream?
Such questions deserve answers, however tentative. That we have largely neglected to provide them up until now has been due more to our sense of history than anything else. After the fall of the Berlin Wall in 1989 and the collapse of the Soviet Union two years later it was difficult to address the question of socialism for at least two reasons: (1) its almost complete identification in the popular mind with the fallen Soviet system; and (2) the triumphalist vision of capitalism that was paraded at the time. Since these beliefs were more a product of prevailing ideology than reality, we concluded that history would soon begin to dissolve them and the question of socialism would again come to the fore. A wide and open dialogue on the future of socialism could then begin anew. That time we are convinced is now upon us. Moreover, the danger to the world of not countering the mantra that “there is no alternative” to capitalism is now too great, given persistent problems of economic stagnation, the growth of empire and war, and the threat of ecological collapse.
“The legacy of socialism,” Paul Sweezy wrote in Monthly Review in January 1993, “consists in its being the real-life alternative to capitalism. On the world-historical stage it plays the role of the significant other. This is not to deny that the leading ideas of socialism—equality and cooperation as against hierarchy and competition—are part of socialism’s legacy. But they are not unique to socialism, and historically, they long antedate socialism. In one way or another, they figure in all of humanity’s great religious traditions.”*
Socialism as a socio-political movement grew out of the attempt to overcome capitalism that has been part of world history ever since capitalism’s emergence in the sixteenth and seventeenth centuries. It was prefigured by the Peasants’ War of the Anabaptists and Thomas Münzer during the German Reformation of the sixteenth century. It appeared again in the movement of Winstanley and the Diggers in the English Revolution of the seventeenth century. It raised its head once more with Gracchus Babeuf and the Equals in the French Revolution of the eighteenth century. It was Babeuf and his Equals who argued in 1795–96 that “equality must be measured by the capacity of the worker and the need of the consumer, not by the intensity of the labor and the quantity of things consumed.”1 Karl Marx was later to say this even more succinctly in his famous slogan in the Critique of the Gotha Programme—“from each according to his abilities, to each according to his needs!”—offered as the ultimate criterion of socialist or communist society. What all of these early movements of revolt called for was substantive equality, abolishing class and other social distinctions, and going beyond the mere formal political equality offered by bourgeois society. In opposition to the growth of private property they advocated common ownership of the means of production.
The term “socialism” first made its appearance in France following the French Revolution in relation to the ideas of the great utopian socialists, Charles Fourier and Comte Henri de Saint-Simon, and was soon embraced by the Owenite movement in Britain led by industrialist Robert Owen. The utopian socialists saw capitalism as historically transitory, destined to perish just as feudalism had before it, and believed that it would be replaced by a society of true equality and the full flowering of human reason. Writing at the moment that industrial capitalism and an industrial working class were emerging in Britain (where a full-scale industrial revolution was underway) and in France, the criticisms of capitalism’s evils by the utopian socialists were often trenchant. Fourier wrote that “under civilization [i.e., capitalism] poverty is borne of super-abundance itself.” In industrial capitalism’s place they advocated far-reaching reform in factory conditions, education, the situation of women, the relation between town and country, etc.
The visions offered by the utopian socialists, however, lacked a systematic conception of the causes of the material conditions that they described or the real class obstacles to social change. Although sympathizing with the working class, they did not yet see the workers as the main agents of socialist transformation. Owen ended his Book of the New Moral World with an appeal to King William IV of Britain in which he said: “under your reign, Sire, the change from this system, with all its evil consequences, to another founded on self-evident truths, ensuring happiness to all, will, in all probability, be achieved.” Fourier announced that he would be home at noon every day to await a wealthy benefactor who would provide the money for a colony that would implement the principles of his new society. He waited twelve years in vain. Followers of Saint-Simon declared in their organ, The Globe, on November 28, 1831: “The working classes cannot rise unless the upper classes reach out their hand. It is from these latter that the initiative must come.”2
While the utopian socialists ultimately reached out to the ruling classes to support their ideas, more revolutionary movements arose from the practical struggles of industrial workers themselves, who not infrequently saw their own class action as the means of overturning the new system of exploitation. It fell to Karl Marx and Friedrich Engels, born in the relatively developed Rhineland in 1818 and 1820, respectively, and equipped with the dialectical tools of analysis offered by Hegelian philosophy, to provide this burgeoning working-class movement with a systematic critique of capitalism, identifying its driving force in capital accumulation as well as the obstacles that faced any attempt to move beyond it. So superior was their analysis to that of the utopian visions that had preceded it that it quickly became the leading theoretical basis for socialism. With this as its intellectual basis socialism took on the character of a historically-based movement for revolutionary change and a real threat to the existing capitalist order.
The socialist movement spread throughout the nineteenth century, following in capitalism’s footsteps across the globe. Workers’ revolts occurred on occasion, most notably in the Paris Commune of 1870–71, while huge socialist parties developed—officially dedicated to overturning capitalism—with the Social Democratic Party in Germany the most prominent. By the beginning of the twentieth century it was already clear, to quote from the same article by Sweezy, that “the future of humanity would be shaped by the outcome of a bitter and most likely protracted struggle between capitalism and its internally generated opposition.”
This conflict between capitalism and its internally-generated antagonist was, however, enormously complicated by imperialism. From the beginning capitalism was a global system, expanding into the Americas, Asia, and Africa through a relentless process of colonization that also involved slavery and genocide. Capitalism had arisen in a small corner of the globe in Europe and immediately took the form of a hierarchy of states, in which there was a definite center and periphery with intermediate states in between. At its center the system was structured according to its own internal requirements of production and consumption. In the colonized areas of the periphery economies were geared almost exclusively to the needs of the “mother country.” This structural relationship was accompanied by conditions of outright pillage—with the whole system maintained ultimately by the superior force that the imperialist countries were able to bring to bear to protect their interests. The natural resources of the periphery were plundered and the economic surplus that these nations produced was frequently siphoned away. Colonial or neocolonial satellites were placed in conditions of debt peonage with the capitalist metropoles acting as creditors. In this way the countries that first industrialized retained an advantageous position at the center of the world economy, while the barriers facing other nations seeking to develop and to escape a peripheral position within the world-economic system were enormous and for most countries grew worse over time. Indeed for almost all of these nations the barriers separating center from periphery have proven insurmountable over the centuries of capitalist development.
As a result of the growth of capitalist empire and the resulting flow of tribute from periphery to center, the internationalism so important to socialist struggles frequently broke down. Considerable segments of the working classes of Britain, France, the United States, Germany, Italy, etc. supported the expansion of their respective empires under the belief that it improved the positions of their nations and themselves. Eventually, as imperialist wars for control of world territory led to the First World War, the working classes of the advanced capitalist countries subordinated themselves en masse to the imperial goals of their states and corporations. The leading socialist parties, such as the German Social Democratic Party, capitulated overnight to nationalistic war fever, thereby abandoning socialist internationalism and giving way to what was to be a major fratricidal conflict.
This capitulation to nationalism by the major social democratic parties, driven in part by the self-interest of their leaders, created a deep and unbridgeable split within the socialist movement. Rosa Luxemburg and Lenin, standing for the most radical and defiant sections of German Social Democracy and Russian Social Democracy, respectively, opposed the First World War, arguing instead for socialist internationalism. The Russian Revolution of 1917, erupting in the midst of the First World War, was spurred forward by the socialist leadership of Lenin and the Bolshevik Party. The rise of the Soviet Union constituted a turning point in world history: the first attempt on the part of a major state to overthrow capitalism and create a socialist society.
The First World War marked the beginning of a great crisis of the capitalist system, dominating the first half of the twentieth century, including two global conflagrations and a full decade of economic depression. While the center capitalist nations were at war with each other or experiencing depression, their hold on the peoples in their empires broke down. This made it possible for many of the populations of the periphery to break away. Within just a few years after the Second World War, the Chinese Revolution of 1949 occurred. Altogether a third of humanity occupying roughly the same portion of the world’s land mass separated from the capitalist system in the twentieth century. Hundreds of millions of people including large numbers within the capitalist world itself came to identify with socialism in some form or another. The result of these developments was that the struggle between capitalism and socialism was to take on new and more intense forms.
Already at the time of the Russian Revolution the warring European powers had sent troops to support the White Army against the Red Army in the Russian Civil War. The Red Army triumphed but at enormous cost: the small industrial proletariat that was the main force behind the revolution and that provided the crack troops for the Red Army was decimated, thereby depriving the revolution of its main class force. Meanwhile revolutionary working-class outbreaks had been bloodily suppressed in Germany and Central Europe in the immediate aftermath of the First World War. The failure of revolution in the West meant that the Soviet Union was effectively isolated.
The defeat of the White Army and their Western allies in the Civil War, coupled with the preoccupation of the capitalist powers in rebuilding their own economies following the First World War, bought the new revolutionary society in the Soviet Union some breathing space. But the realities of a socialist revolution occurring in extremely unfavorable conditions in an underdeveloped country set the stage for a tragedy of vast proportions that was to develop over decades. Under pressure to develop rapidly, if only to be able to defend itself, the Soviet Union set out on a path of rapid industrialization that involved the forced expropriation of the kulaks and middle peasantry and enormous human hardship, cruelty, and suffering. The intention was to achieve in decades through what was called “socialist primitive accumulation” what capitalist societies had taken centuries to achieve. This strategy of building “socialism in one country” in an underdeveloped nation recovering from civil war led to a military-style cleavage between the leaders and the population, which was to harden over the years into a new class division. Lenin in the early years of the revolution fought the growth of bureaucracy and Great Russian chauvinism. But his death and the rise of Stalin to the top of the party bureaucracy marked the triumph of bureaucratic control and the removal of power from the masses. This was followed by the purging of the old Bolshevik leadership and the end of any attempt to build socialism in the sense of a society controlled by the direct producers. Revolutionary ardor from below was replaced with an iron fist from above—although workers were given important social welfare benefits and securities in areas such as employment and housing that were lacking in capitalist society, bolstering support for the post-revolutionary system. The Soviet Union early on adopted what economists call a “war economy” characterized by a forced drafting of population and resources in successive five year plans.
Although brought into being by a revolutionary movement determined to construct a socialist society, the Soviet Union had ceased by the 1930s to be socialist in the sense of a society moving toward a more egalitarian economic and social structure. Yet, it remained a post-revolutionary society distinguished in many ways from capitalism. Competition between enterprises played almost no role in the economic workings of Soviet society. Private ownership of the means of production had been abolished. Unemployment was virtually non-existent. Many basic social amenities were guaranteed.
Despite its veering away from socialist goals, the Russian Revolution’s expropriation of capitalist private property, followed by the creation of a distinct post-revolutionary society, constituted a grave threat to capitalism, especially if other peoples were thereby encouraged to follow the same path. Hence the survival and economic development of the Soviet Union was looked upon with growing dismay by the ruling classes in the West. The need to recover from the damage inflicted by the First World War, however, prevented any further military action against the Soviets in the aftermath of the war. During the Great Depression of the 1930s capitalism was preoccupied with its own immediate survival, while the Soviet Union was experiencing record growth. The first capitalist nation to find a way out of the depression was Hitler’s Germany, which revived its economy through a process of rapid rearmament. The magnitude of the Nazi threat led to an unlikely alliance between Britain, the United States, and the Soviet Union in the Second World War.
Still, no sooner was the outcome of the war certain than the demonization of the Soviet Union by the ruling classes of the West began in earnest. The anticommunist scare represented by McCarthyism in the United States was used to split and crush the labor movement along with the larger New Deal alliance between labor, farmers, and civil rights activists. Preparations were made and battle lines drawn for what had all the appearance of a developing Third World War. Coming out of the Second World War with an atomic bomb monopoly, the United States initiated a strategy of rollback aimed at reducing Soviet influence in Europe. But this strategy was arrested by the Soviet Union’s rapid development of the bomb.
A prolonged stalemate was thus established that became known as the Cold War. The threat of war continued with both of the main protagonists arming themselves with thousands of nuclear weapons, and was doubtless only prevented by the certainty of mutual assured destruction. Unable to continue its strategy of rollback, the United States chose to concentrate on maintaining the two-thirds of the world that remained firmly in capitalist hands. It thus sought to prevent any further revolutions against the system. In practice this meant keeping the imperialist system intact. This was coupled with another and even more important part of the U.S. strategy: to make sure that those nations that had managed to exit the system would be unable to achieve success at building a socialist society. The greatest argument against socialism had always been its impracticality. If this objection could be erased capitalism’s days would be numbered.
Thus arose the three components of the Cold War strategy of the capitalist world: (1) a massive arms race against the Soviet Union in which the United States and its allies were always a few steps ahead, despite the emergence in the end of what was called nuclear parity; (2) active military intervention by the United States throughout the third world, eventually adding up to the loss of millions of lives, coupled with economic and political pressure on the periphery, designed to keep these nations in line while maintaining a constant net flow of wealth to the countries at the center of the system—in accord with the whole history of U.S imperialism; and (3) unrelenting hostility, including economic blockades and political and military pressure, aimed at those states that had exited the system.
A minimal set of economic and political reforms were introduced in the Soviet Union in the mid-1960s, but these modest reforms were resisted by already entrenched interests at the top of society. A new class or priviligentsia (consisting of apparatchiks, managers, and privileged intellectuals) had emerged and consolidated its rule over the decades.3 Although not able to own the means of production and to pass on such wealth through inheritance as in the case of capitalism, the new Soviet ruling class was nonetheless able to secure a highly favored treatment for its progeny by ensuring privileged access to education and other means of advance. In the 1960s, ’70s, and ’80s the Soviet Union sank into economic stagnation, resulting from bureaucratic ossification, misplaced economic priorities (e.g., investment in heavy industry and military expenditures at the expense of necessary consumption), and the long-term effects of the continual forced drafting of labor and resources, which undermined the conditions of production and the environmental basis for growth.
Stagnation also characterized the other countries in the Soviet bloc, which were forced to replicate the bureaucratic rigidities of the Soviet Union—blocking any attempts to generate free socialist development. When, in Hungary in 1956 and Czechoslovakia in 1968, attempts were made to chart separate courses that threatened the stability of the Soviet bloc, Soviet tanks were sent in and these experiments were brought to an end.
What crippled the whole development of the Soviet Union from the start and contributed to its final demise (well after the actual struggle for socialism there had been lost) was the enormous and continuing military burden imposed from the outside, starting with the invasion by the advanced capitalist nations in support of the White forces and culminating in the Cold War. For a rich capitalist nation, such as the United States, which normally operates below capacity production with large amounts of unemployment, high levels of publicly-financed military spending can boost the economy. Just as such spending boosted Hitler’s Germany in the 1930s, it also ended the Great Depression in the United States. The Depression simply merged into the Second World War when the flood of orders for war goods started arriving from Europe. After the war, recognizing the fact that military spending served to bolster the economy and with a great empire (Pax Americana as it was called) to defend, the United States continued high-level Pentagon spending.
One of the main strengths of a centrally-planned economy, however, is that it normally operates at full employment with full utilization of productive capacity. In economic terms, it operates on its production possibilities curve rather than below it. Hence, any expansion of military output must come at the expense of something else—the classic trade-off of guns and butter. Forced to compete in an arms race with the United States and other rich capitalist countries, the smaller Soviet economy was compelled to divert its resources away from consumption goods and ultimately from the necessary investment in the means of production themselves, which require continual maintenance and eventual replacement with better, more productive plant and equipment. For the Soviet Union the necessity of the state diverting its resources to military production—and on a level required to maintain parity with the United States—was a perpetual disaster. In the Cold War, the capitalist world proved far more able to afford massively wasteful military spending than its post-revolutionary rival.
Similar problems faced other post-revolutionary states. Burdened with the difficulty of developing the economy under conditions of economic underdevelopment and unrelenting hostility from the capitalist powers most of these states saw the rise of regimes that sooner or later succumbed to capitalism either directly or indirectly. In China the Cultural Revolution unleashed by Mao attempted unsuccessfully to combat the rise of a new ruling class out of the Communist bureaucracy itself, which he feared would take the society back to capitalism. The Cultural Revolution failed and Mao’s worst fears were to be realized.
The rise of Gorbachev in the Soviet Union in 1985 seemed at first to offer hope of a major overhaul of the system. The social, economic, and ecological decline of Soviet society by that time was so severe, however, that the state was no longer in a position to carry out the necessary reforms to restore its economy and society, even if it had the will to do so, while also keeping the capitalist world economy at bay. The option of mobilizing the population in an attempt to revive genuine revolutionary change was never contemplated, since it was opposed to the ruling interests. By the time of the fall of the Berlin Wall in 1989 it was clear that capitalism had won the Cold War, and two years later the Soviet Union itself collapsed. Writing for the New Yorker (January 23, 1989) economist Robert Heilbroner captured the prevailing view in the United States: “Less than seventy-five years after it officially began, the contest between capitalism and socialism is over, capitalism has won.”
Nevertheless, many, Heilbroner included, still believed that socialism in another sense, not as an outright alternative to capitalism but as a humanization and rationalization of it, might somehow persist. With the split of the socialist movement at the time of the First World War the original social democratic parties of Europe had evolved in two directions. One was the revolutionary current associated with Luxemburg and Lenin. The other had supported the First World War and had turned into a largely reformist movement, geared to promoting trade union interests, the welfare state, and (at its most radical) the nationalization of the commanding heights of the economy. For this movement, now often designated as “social democrat” to distinguish it from a more thoroughgoing socialism, the object was to create a more rational capitalism, one more amenable to socialist values, rather than break with the economic structure of the system. It relied on building up political parties aimed at obtaining electoral victories as opposed to encouraging popular revolt. In practice, European Communist Parties moved toward a similar position in what was called Eurocommunism. With the collapse of the Soviet Union many professed to believe that parliamentary socialism of a social democratic variety would come to the fore, representing the common bond between Eastern and Western Europe.
Social democracy, however, had waned considerably even before the fall of the Soviet bloc. Its main achievement, the development of the welfare state, was a product of the brief “golden age” of economic growth in the advanced capitalist countries in the quarter-century following the Second World War. With the economic slowdown that began in the 1970s the powers that be regarded the welfare state as a luxury to be discarded as part of a general economic restructuring. The rise of neoliberal globalization undercut all dreams of a rational, social-democratic society within a capitalist environment. Social democracy suffered its most dramatic defeat following the 1981 election of Francois Mitterrand as the first Socialist president of France. Mitterrand began his term of office with a program of nationalization and Keynesian-style promotion of effective demand. But after two years of pursuing this program and facing the opposition of finance capital Mitterrand, in an attempt to cling to power, reversed himself and committed his Socialist government to a neoliberal strategy. By the time the Berlin wall fell social democracy had already shown itself to be bankrupt.
In the periphery of the world economy the disappearance of the Soviet Union was to have a devastating effect, further closing off avenues for socialist-oriented change. Although it had long been a conservative and stagnant society with a hardening class structure, the Soviet Union had nonetheless, as part of its own Cold War foreign policy, provided some support to revolutionary movements and governments in the periphery, as a way of weakening the rival capitalist system. With the Soviets gone these movements and societies in the third world found themselves increasingly deprived of crucial outside support and the prospects for national liberation struggles were everywhere lessened.
By the 1990s the victory of capitalism in the Cold War had therefore virtually eliminated any possibility that the revolutions of the twentieth century would or could lead to working models of alternative societies. Not only had the Soviet Union been defeated in the Cold War, but socialism as the real-life alternative to capitalism was pronounced eternally dead by the victors since it had been tried and had failed. From now on, the prevailing ideology incessantly proclaimed, capitalism was the only game in town: there was no alternative. It was “the end of history.”
But was this right? Had socialism really been tried and failed? And was capitalism truly the culmination, the final end-point, of world history?
First, Cuba remained as a standing reproach to all those who had abandoned hope for socialism and a beacon to the oppressed—above all to the rest of Latin America. Although a small, poor nation that after the destruction of the Soviet Union was left to rely on its own meager resources while facing the crazed hostility of the sole global superpower, Cuba nonetheless pulled through. It is emerging from its “special period” with a society in which socialist planning and a commitment to equality have generated levels of education and health equal to those of the richest nations of the world. The greening of Cuba and its achievement of agricultural sustainability, despite the economic blockade against it by the United States, are inspiring poor countries throughout the world. The demonstration effect of Cuban socialism is only now beginning to be felt in a socialist resurgence that is taking hold everywhere in Latin America.
Second, crucial to the foregoing argument has been recognition of the fact that the Soviet Union’s collapse in 1991 was not the end, as often said, of actually existing socialism but simply the termination of a historical process that had commenced three quarters of a century before with the first significant attempt to break away from capitalism and to build a working socialist society. The Russian Revolution and subsequent revolutionary breaks had occurred under extremely unfavorable conditions in economically underdeveloped countries. Internal struggles and external interventions brought most of these revolutions down not long after they emerged. In the Soviet case the society had ceased to pursue a socialist path toward equality and cooperation, in which the direction of the society would be determined by its own working class, as early as the Stalinist takeover in the 1930s. After that it became a stagnant post-revolutionary (but no longer in any meaningful sense socialist) society, which still managed to maintain itself in existence and to provide a modicum of benefits to its population. Yet, its very stagnation guaranteed that it must at some point in the future either move decisively toward socialism by turning back to the masses, or toward capitalism by allowing the ruling stratum to turn itself into a true ruling class, which would inevitably choose capitalism over socialism. In the end the latter transpired. Hence, the real defeat of socialism in the Soviet Union, as opposed to the demise of the Soviet Union as a separate nation state, occurred not with the end of the Cold War, but had taken place decades prior in the 1930s.
The capitalist victors in this struggle naturally wish to believe and to convince all others that the fall of the Soviet Union proved that socialism is in all cases doomed to failure. Such an interpretation is, however, neither logically nor historically sound. The struggle to generate a capitalist society out of a feudal one in the waning Middle Ages was itself a long and protracted process, with many false starts and defeats. Early struggles for a bourgeois society, though often promising, were engulfed by feudal social relations and lacked the stamina to survive. It required several centuries and a new historical conjuncture before capitalism was able to establish a significant beachhead and ward off its enemies enabling it to grow into a global force. Whether history will “repeat” itself in this respect is something no one knows. But that such a possibility exists cannot logically or historically be disproved.
Moreover, it is obvious today, in ways that it was not a decade and a half ago, that capitalism’s triumph was to be extremely short-lived, since the global economic slowdown and increasing class polarization that have haunted its steps since the 1970s continue to develop.
Capitalism is a system devoted not to the satisfaction of human needs but to the accumulation of capital. During the first century and a half following the industrial revolution the conditions of capital accumulation at the center of the capitalist world were extremely favorable. Industry had to be built up from scratch and there was a seemingly unlimited scope for investment. Hence, there was a vast demand for capital, which was always in short supply. Once industry had been built up, however, so that it was possible to supply capital for investment out of existing depreciation funds with little net investment, the economic dynamism of the system broke down and a long-run tendency toward economic stagnation set in. The severity of this problem became evident at the time of the Great Depression.
What is now referred to as a “golden age” of economic growth in the 1950s and ’60s was made possible by exceptional circumstances following the Second World War that provided the conditions for rapid growth. These included such factors as: a backlog of consumer liquidity built up during the war; the rebuilding of the war-devastated economies of Europe; a second great wave of automobilization; American economic hegemony; Cold War military spending (including two regional wars in Asia); the growth of the sales effort; financial expansion, etc. Once these special historical circumstances began to fade the period of relatively high growth vanished and the underlying general tendency toward economic stagnation began to reassert itself.*
A slowdown in economic growth, all other things being equal, threatens profits. As stagnation reappeared (first as “stagflation,” i.e., stagnation plus inflation) in the 1970s and then persisted in the following decades every means were utilized to ensure that all other things were not equal and that profits would be increased by any means possible. Beginning in the 1980s a more naked capitalism, known as neoliberalism, came into being. The goal was to remove all barriers to the increase of capitalist profits and savings and to the free flow of capital across the globe. Hence, neoliberal restructuring has come to mean: cutbacks in wages; high unemployment and underemployment; the breaking of trade unions; reduction of state welfare spending; tax reform designed to redistribute income and wealth from the poor to the rich; removal of all limits on foreign investment and repatriation of profits; privatization of state firms; increased subsidies to capital; elimination of food programs for the poor; the forced removal of subsistence farmers from the land; more stringent controls on indebted third world countries; repeated devaluation of currencies in peripheral states; reduction of environmental restrictions, etc. With the demise of the rival system represented by the Soviet bloc this process of neoliberal restructuring, which had been taking place throughout the 1980s, became if anything more intense and came to be known as economic globalization. It was given new institutional bases through the creation of free trade agreements, such as the North American Free Trade Agreement, and through the formation of the World Trade Organization, which joined the International Monetary Fund and the World Bank as institutional machinery for enforcing the capitalist rules of the game at the international level.
The result has been a growing polarization between rich and poor in every country of the capitalist world and between rich and poor countries generally. None of this has served to increase the rate of economic growth within the world system as a whole, which has continued to stagnate. Yet wealth and profits at the top of capitalist society have skyrocketed, with a few hundred individuals at the apex of the world system now enjoying a combined wealth that exceeds the aggregate annual income of billions of people at the bottom.
According to the Wall Street Journal (May 13, 2005): “A substantial body of research finds that at least 45% of parents’ advantage in income [in the United States] is passed along to their children, and perhaps as much as 60%. With the higher estimate, it’s not only how much your parents have that matters—even your great-great grandfather’s wealth might give you a noticeable edge today.” As a New York Times (May 30, 2005) editorial put it, “Class based on economic and social differences remains a powerful force in American life and has come to play a greater, not lesser, role over the last three decades….Those in the upper middle classes enjoy better health and live longer than those in the middle classes, who live longer and better than those on the bottom.” In other words, the United States is a deeply class-divided society, and polarization in terms of rich and poor is rapidly increasing. Education, health, life-expectancy, and general working and living conditions are all closely correlated with class. What is increasingly true for the United States is also true for world capitalism as a whole, with the greatest depths of oppression and starvation occurring in the periphery, where revolutionary and resistance movements inspired by socialism and by all forms of opposition to capitalism and imperialism are reemerging.
The enveloping crisis of civilization that has developed over the last three decades has resulted in a more naked capitalism, but also a more naked imperialism. The imperialism of money has tightened its grip everywhere in the attempt to extract greater profits in the context of a sluggish world economy. But the turn of the new century has also seen increasing recourse to the imperialism of guns.
Currently, the United States, which has experienced a long-run decline of its economic hegemony but still remains the leading capitalist power, is seeking to gain global dominance by military means on a scale that would have been previously inconceivable. The fall of the Soviet Union left the United States as the sole remaining superpower. Over the 1990s it began to move militarily into areas that were formerly part of the Soviet sphere of influence or that had been contested by the superpowers. Thus in the decade and a half since the collapse of the Soviet bloc the United States has fought wars or carried out military interventions in the Persian Gulf, the horn of Africa, the Balkans, and Afghanistan.
Following the events of September 11, 2001, the United States invaded and occupied Afghanistan, allowing it also to expand its geopolitical influence in Central Asia and the Caspian Sea region with its natural gas and oil reserves. Immediately thereafter it invaded Iraq in an attempt to gain control over its oil (the second largest reserve in the world) and that of the Persian Gulf as a whole. The result has been a war with no visible end.
By threatening to seize control of world oil reserves through the exercise of its military power the United States has sent shock waves through the rest of the world, contributing to fear and insecurity throughout the globe. Not only declaring its intention to dominate the globe militarily in its National Security Strategy of the United States for 2002, it has shown its willingness to put this into practice. The United States has engaged in “preemptive” attacks against much smaller powers, has announced its intention to maintain and “modernize” its vast, world-threatening nuclear arsenal, and has increased its military spending to a level that approximates that of all other nations in the world combined. The destabilizing effect of such an unprecedented military build-up by the world’s most powerful and most interventionist state naturally contributed to the breakdown of talks regarding the Nuclear Non-Proliferation Treaty in May 2005.
The ecological crisis engendered by the capitalist world economy meanwhile threatens the collapse of world civilization, and irreparable damage to the entire biosphere from which human society and the planet as we know it may never recover—if current trends are not reversed. The latest scientific reports indicate that global warming is, if anything, increasing faster than was previously thought, leading to fears of unpredictable and cumulative effects and of abrupt climate change. The rate of species extinction is at its highest level since the disappearance of the dinosaurs 65 million years ago mainly due to the decimation of ecosystems throughout the globe. The removal of environmental regulations as a part of neoliberal economics has only served to heighten this ecological crisis. The United States, the hegemonic power of the capitalist world system and the headquarters of the new naked capitalism, has adamantly refused to sign on to the Kyoto Protocol—the first small, if entirely inadequate, step to address the problem of global warming.
The capitalist world system of today can therefore be seen as enveloped in an all-encompassing crisis of the future of civilization. Not surprisingly in this context, resistance to the system is growing more widespread, and the renewal of socialism as a socio-political movement and challenger to capitalism seems to be in the offing. In France the spirit of May 1968, in which workers and students joined forces to demand that the impossible be made possible, has not entirely disappeared; as witnessed by the 1995 Winter of Discontent in which public workers shut down much of the country with popular support, and by the May 2005 rejection (followed by the Dutch only days later) of the proposed constitution of the European Union with its provisions that would have given neoliberal capitalism constitutional status at a European-wide level. The enormous intensity of the protests in Seattle in November 1999 helped to engender a worldwide antiglobalization movement that is continuing to challenge the system. Worldwide outbursts of dissent prior to the 2003 invasion of Iraq by the United States were the largest in history and point to a groundswell of global opposition to imperialism. The fierce resistance to U.S. imperialism within Iraq itself, while arising out of nationalistic and religious forces, has highlighted the weakness of the American military machine.
Revolutions occurring along very different tracks in areas as far removed as Nepal and Venezuela show that attempts to break with capitalism and imperialism are part of the present as history. The Bolivarian Revolution led by the democratically-elected Venezuelan President Hugo Chávez has demonstrated how rapidly social forces can alter conditions in a radical direction if economic barriers are not an obstacle (given that Venezuela is a major oil power) and if the military gives its allegiance to a democratically-based process of revolutionary change. Chávez has repeatedly called for a “Socialism for the 21st Century.” In this he is clearly not asking for the renewal of some pre-existing model, but a new global alternative geared to twenty-first century needs and aimed as always at the promotion of equality and cooperation. Venezuela, in alliance with Cuba, is drawing upon and stimulating the discontent in other parts of Latin America—in Brazil, Uruguay, Bolivia, Ecuador—where many people are discouraged with the workings of the “Washington Consensus” and with the way capitalism and imperialism function in their countries.
It is impossible to know what forms this new socialist renewal will take since it is still in the making and will be subject to continuing historical struggles. Yet it is not utopian to believe that present and future attempts to build socialism will reflect critical historical lessons derived from the past, as well as changing historical conditions that define the present. It is therefore the purpose of this special issue to consider the long history of socialism, its evolving role as an alternative to a changing capitalist reality, and the possibilities buried in the past that may provide hope for the future.
First and foremost among these lessons is the dismissal of an empty fatalism that closes off the future and that claims that the socialist alternative to capitalism is economically impracticable, doomed to failure. The chief contention of the critics is that central planning cannot work and that socialism is therefore inherently inefficient and unworkable. Such arguments seek to turn the question of capitalism versus socialism into a question of the regulatory mechanism of the economy: market versus plan. Central planning of some kind (along with local and regional planning initiatives) is certainly a necessity for socialism and its greatest economic tool. In fact, planning, if emerging from the active participation of the population, is probably the only effective means for democratic participation in economic decisions and for the fulfillment of genuine popular needs. It is the fulfillment of such needs and the active, democratic involvement of the population in their fulfillment that are most important. The capitalist economy, which puts the market in command, completely closes off the possibility of the achievement of such universal goals.
In a socialist economy markets will continue to play a role, but as a servant rather than master. Although some progressive economists, often inspired by recent Chinese history, have advocated a form of “market socialism,” in which the market would remain in charge while the ultimate objectives would be socialist, the same Chinese experience suggests that this leads inexorably back to capitalism.4 In all post-revolutionary societies, the greatest danger, which must be guarded against through the continual participation of the population in the revolutionary process, is the reemergence of a new ruling class. Moreover, history suggests that any post-revolutionary ruling class, once it emerges, will eventually attempt to secure its position in society by returning the society to capitalism—as the best way of enhancing and perpetuating its own power.
Socialism led by the associated producers must seek to turn the enormous productivity of modern society to other ends than the accumulation of capital. Exploitation in the labor process needs to be eliminated through workers’ own self-organization. Work hours need to be shortened and leisure time increased. Wealth and resources should be redirected towards those most in need. In a society that is socialist, i.e. committed to the principle “the free development of each is the condition for the free development of all” (Marx and Engels, The Communist Manifesto), everyone must have access to the basic requirements of free existence: clean air and water, safe food, decent housing, adequate health care, essential means of transport, and worthwhile and rewarding employment.
Socialism cannot survive unless it transcends not only class divisions that divide off those who run the society from those that are compelled to work mainly on their behalf, but also all other major forms of oppression that cripple human potential and prevent democratic, social alliances. If any lesson was learned from the experiences of twentieth-century attempts to create socialism it is that class struggle must be inseparable from the struggles against gender, race, and national oppressions—and against other forms of domination such as those directed against gays or against those politically designated as “the disabled.” Socialism also cannot make any real headway unless it is ecological in the sense of promoting a sustainable relation to the environment, since any other approach threatens the well-being and even survival of the human species, along with all other species with which we share the earth.
The various forms of non-class domination are so endemic to capitalist society, so much a part of its strategy of divide and conquer, that no progress can be made in overcoming class oppression without also fighting—sometimes even in advance of the class struggle—these other social divisions. If the political emancipation of bourgeois society constituted one of the bases upon which a wider human emancipation could be built, a major obstacle to the latter has been the fact that political emancipation—the realm of so-called inalienable human rights—has remained incomplete under capitalism. That obstacle must in all cases be overcome as a necessary part of the struggle for a socialist society.
Rosa Luxemburg insisted in her critique of the Russian Revolution that, “without general elections, without unrestricted freedom of the press and assembly, without a free struggle of opinion, life dies out in every public institution, becomes a mere semblance of life, in which only the bureaucracy remains as the active element.” Hence, the requirement of “socialist democracy,” she insisted, “begins simultaneously with the beginnings of the destruction of class rule and the construction of socialism.” The reason for this is not some abstract sense of justice but a law of socialist revolution itself. Such a democracy—no longer formal but filled with economic and social content—constitutes “the very living source from which alone can come the correction of all the innate shortcomings of social institutions….[it thus embodies] the active, untrammeled, energetic political life of the broadest masses of the people.”5 Socialist democracy is not to be conceived as applying merely to the political sphere, narrowly conceived, but would have to extend to all aspects of public and private life: the factory, the check-out counter, and the office as well, and even the home.
Daniel Singer wrote in these pages in May 1988: “We need a new manifesto. Not a blueprint, not a detailed program. But a project, the vision of a different society, the proof that history has not come to an end, that there is a future beyond capitalism.” That proof is being offered today not by a new manifesto but by history itself. The legacy of socialism, as the real-life alternative to capitalism, also points to the necessity of its renewal in the present. In joining this new struggle we need to clarify the project of an alternative society, while avoiding the mistakes of the past—forever insisting that socialism is the making of a society of equals or it is nothing at all.
* Sweezy’s article “Socialism: Legacy and Renewal” can be regarded as a classic refutation of the notion that the end of the Cold War spelled the end of socialism. Much of the present argument is inspired by his article.
* The special developmental factors that induced the rapid growth of the first quarter century following the Second World War have been detailed in these pages many times. See for example: John Bellamy Foster, “The End of Rational Capitalism,” Monthly Review, March 2005.
- Quoted in Daniel Singer, Whose Millennium?: Theirs or Ours? (New York: Monthly Review Press, 1999), 234.
- Fourier, Owen, and Saint-Simon’s followers quoted in Frederick Engels, Socialism: Utopian and Scientific (New York: International Publishers, 1978), 39 and Leo Huberman, The Truth About Socialism (New York: Lear Publishers, 1950), 157–58.
- See Singer, Whose Millennium?, 24–26.
- See Martin Hart-Landsberg and Paul Burkett, “China and Socialism: Market Reforms and Class Struggle,” Monthly Review 56, no. 3 (July–August 2004).
- Rosa Luxemburg, The Rosa Luxemburg Reader (New York: Monthly Review Press, 2004), 302–10.