So....take it away Tundra...
I think that when humans add an "ism" to something, they are just trying to make things complicated. But just forget about the "ism" and concentrate on the meaning and this will be as easy as chasing squirrels (one of my favorite hobbies).
The Means of production...
But we have to take a quick detour. You see, in order to understand what all these "isms" mean, you need to understand a little thing called "the means of production". All of these economic/political models revolve around who owns/controls the means of production.The four factors measured in the means of production...
There are four major factors that together form the means of production. They are responsible for the production of all goods/services in any given economy - or their gross domestic product
The four factors are...
- Land
- Labor
- Capital
- Entrepreneurship
By land, we mean more than just a piece of dirt. In this context, land includes any kind of natural resource that comes from the land. For example, precious metals that can be mined from land, or renewable resources such as crops or timber.
Labor is obviously the work that is done by people. People measure the output from workers as productivity (worker output per hour).
In this context, capital refers to capital goods such as the equipment or machinery needed for production. Things like computer chips or delivery trucks are examples of capital goods.
Entrepreneurship is the process that a business owner goes through to develop an idea into a tangible business.
The 3 big "isms" - Capitalism vs Socialism vs Communism...
This chart is a summary of the fundamental characteristics of the three "isms: - capitalism vs socialism vs communism. As definitions, the chart and descriptions represent models in their purest form. Just realize that in practice, no economy exists as a pure model. Even the most ardently capitalistic system has some form of government regulation and countries that many would call "socialist" have much of their economies based on private enterprise.
Characteristics of Capitalism, Socialism, and Communism |
|||
|---|---|---|---|
| Attribution | Capitalism | Socialism | Communism |
| Means of production owned by |
Individuals | Public | Public |
| Value Determined by | Profit | Usefulness | Usefulness |
| Private ownership | Allowed | Allowed | Not Allowed |
| Motto: "From each according to..." |
Market Forces | Ability | Ability |
| Motto: "To each according to..." |
Net-Worth | Contribution | Need |
Below are the bare-bones definitions with some examples. There is also a video for those who can't bear to read the dry test. (Definitions are dry things - that's the nature of the beast I'm afraid)
Capitalism...
Capitalism is a market-based economy in which interference by the government in markets is kept to a minimum. There are many variations of capitalism, but in its purest form, the government lets the markets self-regulate. In other incarnations capitalism co-exists with such things as safety nets for individuals, universal healthcare coverage and regulations that discourage such things as corruption, environmental abuse and the growth of monopolies.It is probably better to think of capitalism in terms of a sliding scale of free-market economies with varying amounts of regulation. What many in the United States would regard as "socialism" is actually a free market system mixed with some public elements and regulatory controls.
There are a couple of features that truly set capitalism apart from socialism and communism.
First, The means of production are held in private hands, not public. In its purest form, virtually all the means of production would be held privately. In more extreme cases, this could include much of the infrastructure of the commons including roads, schools, public safety etc.
Second - The value ascribed to production is based on profit and not the "utility" of the product. In socialism or communism value is determined by its "usefulness" - a term that is probably open to considerable interpretation depending on the POV of the user...For example, a torque wrench might be of tremendous use to a mechanic. But to a Siberian Husky, a dog sled is a far more useful item...More on this further down the road.
First, The means of production are held in private hands, not public. In its purest form, virtually all the means of production would be held privately. In more extreme cases, this could include much of the infrastructure of the commons including roads, schools, public safety etc.
Second - The value ascribed to production is based on profit and not the "utility" of the product. In socialism or communism value is determined by its "usefulness" - a term that is probably open to considerable interpretation depending on the POV of the user...For example, a torque wrench might be of tremendous use to a mechanic. But to a Siberian Husky, a dog sled is a far more useful item...More on this further down the road.
Socialism...
Motto for socialism: From each according to his ability, to each according to his contribution.
Socialism is an economic system based on common ownership of the means of production. Most commonly, such ownership and administration is placed in the hands of a democratically elected government. Public corporations and cooperatives are also viable models. This is the most important distinction between capitalism and socialism.
It should be noted that ownership, in general, is not banned under socialism. Private ownership is allowed. For example, people often own their own homes. It is private ownership of business and industry is that is a no-go.
And if you think that this isn't confusing enough, just wait. You see, pure socialism with no privately held means of production doesn't really happen in practice. Most countries that would be considered very socialist by American standards have a healthy mix of public and private means of production. Many of the northern European nations would be best described as capitalist countries with strong safety nets that include socialist elements such as universal health insurance.
Once again, we need to get out our sliding scales and realize that national economic policies don't fit neatly into simply defined categories. It will never be that black and white. Elements of capitalism are usually found in socialist countries and vice-versa.
Socialism is an economic system based on common ownership of the means of production. Most commonly, such ownership and administration is placed in the hands of a democratically elected government. Public corporations and cooperatives are also viable models. This is the most important distinction between capitalism and socialism.
It should be noted that ownership, in general, is not banned under socialism. Private ownership is allowed. For example, people often own their own homes. It is private ownership of business and industry is that is a no-go.
And if you think that this isn't confusing enough, just wait. You see, pure socialism with no privately held means of production doesn't really happen in practice. Most countries that would be considered very socialist by American standards have a healthy mix of public and private means of production. Many of the northern European nations would be best described as capitalist countries with strong safety nets that include socialist elements such as universal health insurance.
Once again, we need to get out our sliding scales and realize that national economic policies don't fit neatly into simply defined categories. It will never be that black and white. Elements of capitalism are usually found in socialist countries and vice-versa.
It is very important to point out that socialism functions well under democratic principles. Socialism is an economic system and not political. So concerns that socialism will automatically lead down a slippery slope to communism or/and totalitarianism are just not valid.
Communism...
Motto for communism: From each according to his ability, to each according to his needs.
To many Americans, communism and socialism are almost one and the same thing. But there are several important distinctions between communism and socialism.
-
Under communism, there is no private or business ownership.
-
Distribution is not tied in any way to contribution but rather than to need.
-
Communism is not just an economic system but represents both a political and economic system.
The latter creates a real point of departure from capitalism and socialism where prevailing political/governmental structures and institutions can work with these differing economic philosophies. In communism the requirement of a social revolution between the two classes major classes (the working class and capitalist class) is implicit. Although communism includes several variations, the requirement for a revolution is a constant.
The video below discusses some of the same basic premises...
To many Americans, communism and socialism are almost one and the same thing. But there are several important distinctions between communism and socialism.
- Under communism, there is no private or business ownership.
- Distribution is not tied in any way to contribution but rather than to need.
- Communism is not just an economic system but represents both a political and economic system.
The latter creates a real point of departure from capitalism and socialism where prevailing political/governmental structures and institutions can work with these differing economic philosophies. In communism the requirement of a social revolution between the two classes major classes (the working class and capitalist class) is implicit. Although communism includes several variations, the requirement for a revolution is a constant.
The video below discusses some of the same basic premises...
The video below discusses some of the same basic premises...
Socialism vs Democratic Socialism and Bernie Sanders...
If you have been watching and listening to the pre-primary debate madness, you know that Bernie Sanders has described himself as a"democratic socialist". This has created a storm of controversy. The cries of how Sanders was out to destroy prosperity for millions was just about everywhere. It was like he was against puppies, kittens, motherhood and apple pie. This is far from surprising.
For the last 40 years just hinting at the "S-word" was a sure-fire way to terminate a political career. "Socialism" had replaced communism as the political bogey man that was out to destroy all that Americans held near and dear. The common wisdom of our time is that any form of "socialism" is but a short and slippery slope to communism and totalitarianism.
Forget what Sanders actually meant by calling himself that. It didn't matter. That a candidate described themselves as a "socialist" anything was supposed to send them into a black hole from which they would never return.
So what is democratic socialism? How does that compare to socialism? Once again - it's complicated. One reason for this complication is that democratic socialism doesn't mean the same thing in the US as it does in Europe. Traditionally, democratic socialists believe in a systematic shift in economic models from capitalism to socialism. But that's a more European definition. In fact, it appears that the American version of democratic socialism is closer to European social democrats. And yes, democratic socialists and social democrats are two distinctly different things. (You can't make this stuff up!)
What Sanders and democratic socialists in America are describing is far closer to what we had during the New Deal and post-war era in the 20th century. In other words, the Sanders brand of "socialism" is really capitalism. Most of the policies being discussed are nothing new, even in the US. What is being proposed is similar to the economic policies we lived under from the time of the New Deal to the Reagan era. As Michael Kazin, a professor of History at Georgetown University said in an interview with Time: “What democratic socialists want is closer to what exists in Scandinavia or Iceland, expanding what Europeans talk about — a large welfare state in a capitalist society”.
Democratic Socialists of America (DSA) have a website that pretty much describes what they advocate. Note that Sanders is not a member of the DSA. Nevertheless, it is a good starting point for understanding what that actually means in the US. If you go to the site, you will see that they are supporting Bernie Sanders. They support the Green New Deal, strong unions, fair wages, and MedicareForAll.
This may be a departure from economic policies we've lived under for the past 40 years, but it is not the stuff of a revolutionary overthrow of capitalism. It is only "revolutionary" in a bad sense to those who have done extremely well under our current neoliberal supply-side economy.
This video has an excellent explanation of democratic socialism...
This video has an excellent explanation of democratic socialism...
The top Four Democratic Candidates - Where do they stand...
As of this writing, we are about one month away from the Iowa caucuses. There are 4 candidates that are clearing leading a pack of Democratic hopefuls that started out over 20 strong. They are Joe Biden, Pete Buttigieg, Elizabeth Warren, and Bernie Sanders.
The primary campaign has bifurcated along the line of economic centrists and progressives. The candidates that are seeking out large corporate donors seem to be back peddling to the center. This has been particularly true of MedicareForAll. It has been fascinating to watch all the shape-shifting that has been going on. Even Elizabeth Warren has been backing off that commitment.
Kamala Harris, another heavily backed corporate candidate embraced MedicareForAll - until she didn't. Famously backing down on her commitment to MedicareForAll by proposing a phase-in that would happen over 10 YEARS - to something resembling what Biden was proposing. Buttigieg started out passionately supporting MedicareForAll, but as his largesse from insurers and pharma he seemed to make a 180 turn on the subject. (Funny how that seems to happen) He even went to the extent of calling those who supported MedicareForAll fiscally reckless. Of the two centrists, Biden was never anything but a centrist. But Buttigieg has been backing his way into the center for the last several months. Maybe he can become the first "centrist progressive" ever to exist.
The chart below shows the relative position of each of the four leading candidates with respect to economic ideology. Granted, this is more than a bit subjective. But the take-home message is that none of these candidates are fire-breathing radicals ready to take the country down the road to Chairman Mao Tse Tung's world view or an American Bolshevik revolution. It's time to stop radicalizing change that isn't radical and end stop the pearl-clutching and fear-mongering.
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