Socialism vs. Capitalism: History, Theory, and Global Impact

Introduction: Socialism and Its Contested Meaning

Socialism is a highly charged issue in any capitalist culture. A lack of general understanding of the term, combined with the fragmentation of its application over the years, has led many to equate it with both despotism and social degeneration through lack of personal control over the means of production. To many capitalist thinkers, socialism holds back the progress of any individual, and therefore of any culture that accepts it, through the seeming lack of upward mobility available to those who practice socialism broadly. Socialism is generally defined as:

"The general term for the political and economic theory that advocates a system of collective or government ownership and management of the means of production and distribution of goods. Because of the collective nature of socialism, it is to be contrasted to the doctrine of the sanctity of private property that characterizes capitalism. Where capitalism stresses competition and profit, socialism calls for cooperation and social service." ("Socialism")

Because of socialism's place as the seeming antithesis of capitalism, the concept is discredited and dismissed by "democratic" capitalist society as a false method for improving any culture or economy (Gray).

In addition, most subscribers to socialist ideals can endlessly name issues and problems inherent within a capitalist economic culture. Just a few of these are: the stark and destructive economic distance between rich and poor, which seems only to be growing worse; the lack of equitable social concern, demonstrated through ideals that falsely charge those who are unsuccessful with responsibility for their own failure on the grounds that opportunity is nominally available to everyone; and many more. The reality is that both camps have valid arguments. In a capitalist culture, the unsuccessful are ignored and serve as the foundation on which the successful climb to even greater heights; in a socialist society, the centralization of resource control can often lead to abuses that reduce social welfare for all.

In a broader sense, the term socialism is often used loosely to describe economic theories ranging from those that hold that only certain public utilities and natural resources should be owned by the state, to those arguing that the state should assume responsibility for all economic planning and direction. In the past 150 years there have been innumerable differing socialist programs. For this reason, socialism as a doctrine is ill defined, although its main purpose—the establishment of cooperation in place of competition—remains fixed ("Socialism").

Origins of Socialist Thought and the Industrial Revolution

What most people fail to understand is that socialism has many faces, and its economic and political dimensions are in constant flux. Though capitalism seems rather straightforward, there are countless examples within ostensibly capitalist societies that embrace concepts of socialism: city-owned utilities, politically controlled education systems, social welfare programs, and the like. In general, even a basic sense of social responsibility toward the poor, disadvantaged, and needy is an expression of socialist political theory. Would any "democratic" nation attempt to deny these as basic facts that inform its cultural decisions? (MacDonald)

Personally, the concepts of socialism are well understood and play a significant part in how the world is viewed—but only because of what I believe to be a greater than average understanding of socialism and of the ways in which capitalism has injured so many. This view is, of course, biased by personal experience as a member of the economically disadvantaged class. Those who hold a higher position in society do not often feel such a bias. Coming from the upper middle class and becoming downwardly mobile despite education and opportunity is not an uncommon situation in today's economy, yet it is often the only way in which an individual in a capitalist society can truly see the futility of opportunity that so frequently arises within capitalist cultures. Sadly, there is extensive qualitative and quantitative evidence that the lower one stands on the socioeconomic ladder, the lower one's level of sociopolitical control over either the means of production or the welfare of the disadvantaged (MacDonald).

The theoretical basis for socialism, though relatively recent, is a rich expression of the diverse ways in which people attain and embrace a worldview—both collectively and individually. It is mainly an expression of the disastrously negative outcomes of uncontrolled capitalist enterprise at the turn of the nineteenth century.

From Utopian Socialism to Marxism

"Socialism arose in the late 18th and early 19th centuries as a reaction to the economic and social changes associated with the Industrial Revolution. While rapid wealth came to the factory owners, the workers became increasingly impoverished. As this capitalist industrial system spread, reactions in the form of socialist thought increased proportionately." ("Socialism")

Key theorists include François Noël Babeuf, who developed the first body of theories associated with class warfare during the French Revolution ("Socialism"). The now-famous Karl Marx, often regarded as the father of modern socialism, later took up these theories as a revolutionist and radical philosopher of what he called "communism."

Socialist writers who followed Babeuf were more moderate. Known as "utopian socialists," they included the Comte de Saint-Simon, Charles Fourier, and Robert Owen. Saint-Simon proposed that production and distribution be carried out by the state, led by industrialists who would found a national community based on cooperation and work to eliminate the poverty of the lowest classes. Fourier and Owen, though differing in many respects, both believed that social organization should be based on small local collective communities rather than Saint-Simon's large centralist state. All three agreed, however, that cooperation should replace competition, and they implicitly rejected class struggle ("Socialism").

The idea of socialism based on small local communities was, of course, a reaction to the reality that the centralization of power lay at the very root of the problems being fought against during the revolution periods of modern Western history. Many social experiments were created in the nineteenth century in response to these ideas, giving birth to the term communism—a word reflecting the concept of the commune, a rather innocuous institution of collective welfare that was later given a dark and sinister label by the capitalist world ("Socialism").

"In the 1840s the term communism came into use to denote loosely a militant leftist form of socialism; it was associated with the writings of Étienne Cabet and his theories of common ownership. Karl Marx and Friedrich Engels later used it to describe the movement that advocated class struggle and revolution to establish a society of cooperation. In 1848, Marx and Engels wrote the famous Communist Manifesto, in which they set forth the principles of what Marx called 'scientific socialism,' arguing the historical inevitability of revolutionary conflict between capital and labor. In all of his works, Marx attacked the socialists as theoretical utopian dreamers who disregarded the necessity of revolutionary struggle to implement their doctrines. In the atmosphere of disillusionment and bitterness that increasingly pervaded European socialism, Marxism later became the theoretical basis for most socialist thought. But the failure of the revolutions of 1848 caused a decline in socialist action in the following two decades, and it was not until the late 1860s that socialism once more emerged as a powerful social force." ("Socialism")

The diversity of the movement is evident from the beginning. Additionally, the nationalistic and secular nature of the communist and socialist movement gave many people cause to view the experiments as unworthy of social acceptance, since they were not globally implementable and, more importantly, were seen as ungodly and starkly at odds with the Protestant work ethic that had pervaded Western thought and driven countless forms of modern subjugation—most plainly manifest in colonialism. Responses to this took the form of Christian Socialism, "led in England by Frederick Denison Maurice and Charles Kingsley; they advocated the establishment of cooperative workshops based on Christian principles" ("Socialism").

Conclusion: Toward a Balanced Understanding

Though socialism has been a pervasive influence in the world—under many names and through many theorists and incarnations—the recent collapse of Eastern European and Soviet communist states has produced at least a theoretical victory for capitalism. Yet the foundational concepts of social responsibility and collective action remain very much a part of the culture left behind in those and other nations ("Socialism"). For this reason, the modern world may well witness the development of a social and political situation that represents a meeting in the middle, so to speak, of socialist and capitalist ideals (Brucan 515).