Socialism: Then and Now

Svetozar Pejovich

Svetozar (Steve) Pejovich is Professor of Economics Emeritus at Texas A&M University and Senior Research Fellow for the International Centre for Economic Research in Torino, Italy. Professor Pejovich's books include The Economics of Property Rights: Towards a Theory of Comparative Economic Systems and The Philosophical and Economic Foundations of Capitalism.

Three types of hard socialism—fascism, national socialism, and communism—fought capitalism in the 20th century. By the early 1990s, socialism in Italy, Germany, and Russia, the respective centers of each variety, was gone. Yet self-defined socialism is suddenly becoming a factor in America. The median voter, who hears the promises of socialists, is largely unaware of that system’s major premises. This paper asks: Is the rising socialism in America home-grown socialism or a replica of the three types of socialism from the last century?

As an American scholar who was subject of National-Socialism (1941-1945) and communism (1945-1957), I can address with some authority two questions that might interest the median voter: (1) What are some fundamental characteristics of national-socialism, fascism, and communism? (2) Do American socialists replicate those fundamental characteristics? Space limitations permit only brief discussion.

Racism is the fundamental characteristic of national socialism. In Hitler’s Germany, the Aryan race was crowned the master race and Germans were declared the purest of all Aryans. Racial groups such as Jews and Gypsies were to be exterminated. Slavic people and other ethnic groups were declared inferior to the Aryans.

In my experience—and subsequent research confirmed its validity—the survival requirements under the Nazis and the communists were different. Nazis imposed draconian rules which they enforced meticulously. Jews were either shot or shipped away. The Slavs and other groups were relatively safe if they obeyed the rules. Communists required people to obey the rules and accept their doctrine. The Nazis wanted people’s obedience; the communists wanted people’s minds.

Corporatism is the fundamental characteristic of fascism. Corporatism is a political system in which the representatives of professional and economic associations (akin to our Congress) make, under control and direction of the party, all major policy decisions. The doctrine of fascism is not racial, and the fascism of the last century was less oppressive (for example, in Spain and Portugal) than national socialism and communism. However, Mussolini succumbed to Hitler, permitted Germans to execute his son-in-law (a leading guardian of the fascist doctrine), and fascism in Italy came to replicate national socialism,

Mussolini’s favorite expression was: “everything for the state, nothing outside the state, nothing against the state.” Corporatism epitomizes this anti-capitalist expression; corporations and professional association serve the state. Like fascists, the so-called progressives in America want to control corporations. Unlike fascists, the progressives want to control corporations to pursue policies favorable to minorities. 

Class struggle is the fundamental characteristic of communism. Class struggle in communism is between labor and capital, which aims to subjugate non-human resources to the Party. The progressives in America consider class struggle as a weapon against institutional racism. Institutional racism means that the prevailing institutions, because of their origin in the western culture, bias competition for entry into various jobs and occupations in the favor of whites; that is so because whites, so the progressives claim, understand western cultural requirements better than non-whites. To dismantle institutional racism, progressives advocate policies such as affirmative action in universities, diversity requirements and gender preference in business enterprises and government agencies, and environmental regulations at the national level.

There is, however, a problem. If the prevailing capitalist institutions discriminated against people not familiar with the western culture, why are Asian students flocking our universities and preforming better than white Americans? Why are many African countries abandoning “their way to socialism” to import capitalist institutions? Why have capitalist institutions changed East Asian economies? Why is Venezuela regressing? Why are Scandinavians electing pro-capitalist parties?

American progressives want government-controlled economy. The likes of Hillary Clinton and Pelosi are corporatists, seeking the political control of corporations. The likes of Ocasio-Cortez, Sanders, and Warren stand closer to communism, seeking radical redistribution of wealth. They call all opponents Nazis or fascists. They do not debate opponents on their merits; they attack their character and motives. Alexandria Ocasio-Cortez added a Stalinist flavor to Bernie Sanders’ and Elizabeth Warren’s numerous proposals that would shift resources from private to public ownership. Alexandria wants government-guaranteed jobs. She must like the Constitution of the former USSR. Article 12 of the 1936 Soviet Constitution, known as the Stalinist Constitution, said: “In the U.S.S.R. work is a duty and a matter of honor for every able-bodied citizen, in accordance with the principle: He who does not work, neither shall he eat.”

In both cases, the adherents of the left are casting their socialist economic doctrines in terms of social equity, racial, sexual, or gendered. Thus, while incorporating some elements of communism and fascism, it is arguable that American socialism is emerging as a home-grown system.

For a longer analysis of the political and economic forces at work in support of American Socialism, see my article, “From socialism in the 1900s to socialism in the 2000s: the rise of liberal socialism.”

Photo: Senator Bernie Sanders, Day of Action People's Rally, Washington DC by Lorie Shaull // CC BY-SA 2.0

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