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Welcome, friends, to another edition of Economic Update, a weekly program devoted to the economic dimensions of our lives. And I'm your host, Richard Wolff. I've been an economics professor all my life, and that, I hope has helped me prepare for these programs. Today I want to do a special kind of program, a program devoted to a topic that is becoming more and more important in the world, but particularly here in the United States. I take my clue from a recent poll by NBC and the Wall Street Journal who worked together on these polls. And this poll showed that 25% of voting Americans believe that socialism is an attractive quality in a candidate when they think about who they're going to vote for. Well, that kind of blew my mind. After over half a century of endlessly demonizing anything and everything having to do with socialism, that one quarter of the American voting population feels they would be drawn to a candidate who, who said of himself or herself, I'm a socialist tells you something about change in America beyond what a million other surveys might show. So socialism is on the agenda. And so I think it might be useful to become clearer than most of the conversation has been about what socialism means. I wish I could sit here and tell you that this is the definition of socialism, but if I did such a thing, you should turn the program off and go elsewhere. Because anybody who tells you that this is socialism is either ignorant or misleading you. Socialism has been around for 150 years. It has spread all over the world. And the end result, inevitably is that different people mean different things by that term. Look, capitalism is what we call the economy in the United States. It's also what the leaders of Saudi Arabia call their economic system. And it's also what the people in Ireland call theirs, and it's also what the people in Nigeria call theirs. Therefore, it obviously means different things to different people. So I want to devote this program to going over with you the three major ways this idea of socialism is understood, because those ways are relevant today. Those ways are fighting it out amongst themselves in terms of the allegiance and feelings and thoughts of people around the world. And they're going to shape our future. So here's the first. In this view, socialism has to do with the government. That's right. The government is to come in and regulate, control. A private capitalist economy. That's right. An economy governed by private enterprises owned by private citizens who trade with one another in an institution called the market, where they buy and sell their labor, their work, their products, their services. That's right. It's a capitalist economy. Private enterprise Markets, but one in which the government is brought in. Some people mean socialism by that and they mean particularly that the government is brought in in a certain way. The government is to regulate what the private enterprises do so that they are less self serving than profit oriented and are more socially concerned. That's why theyminimum wage is something socialists always supported. Many of them want there to be limits on how much prices can be raised by corporations or how much profits can be earned by them. And the second reason socialists want the government to come in is to redistribute wealth. Because capitalism has this tendency to concentrate wealth in very few hands and deprive the mass of people. So the socialists want the government to come in using taxes and using government spending to do a bit of redistribution, to equalize a system that turns unequal very quickly. So for these people, socialism means that the government comes in, regulates and taxes to make what we might call capitalism because it leaves it in, it leaves business in the hands of private enterprises and markets. But we could call it capitalism with a humane face, capitalism with a certain welfare focus, the welfare of all the people. And here are some. Denmark, Norway, Germany, Italy, France, those countries are often referred to as socialists. Their governments are often governments of socialist parties. And that's what those parties mean, that they will have the government do this. Regulating and redistributing, that's one concept of socialism around the world. It's pretty close to what Bernie Sanders means in the United States or what Jeremy Corbyn means, means in Great Britain. But here's the second one. In the second view, this first one doesn't go far enough because yes, the government comes in and controls things and redistributes, but it's in a perpetual war, which the government often loses with those very private enterprises who try to get around the government regulation, who try to get around the government taxation. We're all familiar with those examples of companies, for example, Amazon, which has earned billions in profits the last two years and paid absolutely no taxes to the United States government. Indeed, this last year they're getting a refund in excess of $100 million. So we know that private corporations do everything in their power to use their profits, to use their political power to, to undo, to evade all of those socialistic regulations and redistributions. And this has led some socialists to say, you have to go further. It isn't enough to regulate and redistribute. The government should, here we go, directly take over the enterprises. There shouldn't be private enterprises because those will always be Run for the profit of the private owner. And if you want the economy to serve everybody, then the agent of everybody, the government that we all elect, at least in theory, should take over and run the businesses so they behave in the way that's good for everybody. And there isn't this perpetual war between a regulating government and private enterprise. And the same argument says we shouldn't allow the market to decide who gets what, because a market always delivers whatever is scarce to the people with the most money. It's an institution for those who are rich and who stay that way by using the market. So these socialists go further. The government should take over enterprises, literally own and operate the factories, stores and offices. And instead of the market deciding who gets what, it should be planned in terms of what we want from, for the society as a whole. These kinds of socialists after the 1920s took the name Communists to signal that they went further than the other socialists in order to take over through the government, the apparatus of the economy. So some people mean by socialism, government regulating a private capitalism to make it more humane, to make it less unequal. And other people say, no, no, no. Socialism means for them that the government takes over the enterprise and plans the distribution of output rather than leaving it to the market. And this second group of socialists, often, not always, but often takes the name communist to show how they're different from the first group. And in those kinds of examples, the Soviet Union, the People's Republic of China, and for parts of their history, Cuba, Vietnam and so on are examples. Now let's get to the third kind of socialism that's contesting in the world today to become the important kind, to become the kind believed in and followed by most people, to win your interest as well. And this approach is in a way an evolution out of the other two. It's a kind of critical evolution because it is advanced by people who see some merits. And in the first kind of socialism, government regulation. The second kind, government operating enterprises. But say we don't think that's enough in one way, and it's too much in the other. Here's how it's not enough. It's not enough because it doesn't change the workplace, the place where the mass of people do their economic thing, using their brains and muscles to transform objects in. Into the goods and services we all need to live the lives we want to live. It doesn't change it enough. Meanwhile, it does something too much. It gives too much power to the government, as a government that has this much power to regulate and redistribute let alone a government that takes over owning and operating is a government that runs us the risk that it'll do a lot more than these economic things, using its power for political or cultural controls of a society that we have seen and we don't want again. Well then these kinds of socialists have a new focus for them. What will really make a difference, what will take us beyond capitalism and be a better way of organizing society focuses on the enterprise, the, the workplace. And it goes like we have the economic system we have with its good points and its bad points in large part because we don't allow democracy into the workplace. And these socialists say capitalism never did that. Capitalism is a hierarchical way of organizing an enterprise. A few people, the owner, the shareholders who have the big blocks of shares, they run capitalist enterprises. The mass of us have no control at all and they run it for them. And the way to change society to make it better is to have the people who work in an enterprise, all of them, one person, one vote, have democratic control of the workplace as just as important as having democratic control of the community in which you live, the neighborhood in which you exist, and so on. This kind of socialism is micro focused. It says, let's not talk only about the government and private enterprise. We don't mind private enterprise. The government doesn't have to control everything. There has to be some coordination. But the big issue for us, say these socialists, is the transformation of the workplace, the socialization of the workplace. So it becomes a community run democratically rather than something run by a small number of people who put their benefits, the so called bottom line, as profits for them rather than a good life for everybody. Okay? Those kinds of socialism are arguing with one another for your attention and, and your allegiance. To be interested in socialism doesn't mean you're necessarily the believer of one or the other. Most real socialist societies have mingled the control function of government with the ownership function of government. What most experiments have not done is really tried that other kind of socialism that revolutionizes the workplace, brings democracy to the workplace for the first time and says that's the way to get beyond the limits of capitalism, its inequalities, its instabilities, its injustices. So the question that's being fought out is not the question capitalism versus socialism. Or at least it's not only that, it's also a struggle going on among these different definitions and, and meanings of socialism that are just as important to what's going on as the so called struggle between capitalism and socialism that was so crucial in the last hundred years. We've come to the end of the first half of Economic Update. Stay with us. There will be a continuation of this conversation when we come back. And please remember, Support us on YouTube. Economic update needs your support there. Make use of our websites democracyatwork.info and rdwolff with two Fs.com and as always, our special thanks to the Patreon community that supports us with its interests and its active encouragement for what we do. Our thanks. Welcome back, friends, to the second half of this special program devoted to the different kinds of socialism that are at play in the world today, competing for our attention and competing for our allegiance. For those of us that are interested in doing better than capitalism, I want to ask this question in our second half. How do these different kinds of socialism, these different ideas of what socialism means, how do they affect us? How would they affect us? How have they affected us as individuals working and living our lives? So let's start with the first one. We can call it moderate socialism. Some people call it democratic socialism. It has a lot of names. But it was that kind we talked about first in the first half of this program. Namely, when the government is called in, you leave enterprises in the hands of the private owners and operators, as you have in capitalism. You leave the market as the basic institution to distribute goods and services, but the government comes in to regulate and to redistribute the wealth because of the tendencies towards inequality that capitalism without government tends to show us over and over again. I think the things I would like to stress there are that on the one hand, people in that kind of a socialist society are usually quite supportive of it. If you look at the Scandinavian countries and a number of the Western European countries that are kind of prime examples of this sort of thing, or you look at the image of what Mr. Bernie Sanders wants for the United States, and he himself refers to Denmark and so on as models, at least in part. You get the impression that what this means is that working people have kinds of two sources of well being. On the one hand they work and earn a wage or a salary, and on the other hand they have a very generous supply of public services made available to them by that socialist government. If you look in Europe's history, for example, Scandinavia or France or Germany or Italy, you will see that it was the socialists who pushed for the National Health Service, that they have the unemployment compensation system, that they have the subsidized transportation, the subsidized public education. These were all ways for the government to Come in and make life better for the average person. So there's a sense of. Of support for the socialists in those countries and for the socialism they have, which is one explanation for why it has been so durable over the last century in which it was established there. The problem, if you like, and we have to weigh the costs and benefits of all of these, the problem for this kind of socialism is that it is very insecure. Let me explain. If you leave the ownership and operation of enterprises in the hands of private people, then those private people are in all cases a very small minority of the society. They sit at the top of the economic system. They're the ones who own the bulk of the shares. They're the ones who sit on the board of directors, all of that. And they are constantly struggling to use those positions they have, which includes getting the surplus or profits of this society into their hands to diminish the regulations, to be freer, to do things their enterprises lead them to believe will be profitable. They don't want to be hemmed in by regulations, and they don't want their wealth taken from them by a redistributive government. So they begin to push back. And they have the incentive, but they also have the resources to push back. And so they take away the very socialist benefits that have been captured in earlier periods of their history, which means this kind of socialism is fundamentally insecure. Here's a second problem of that kind of socialism. Redistribution. Governments that use taxes to move wealth at least in part away from those at the top and spread that wealth out more evenly across the society. This leads to incredible social tensions. Wherever redistribution happens, that is a result. I use this example. I'm going to use it again. If you take your child to the park and you have two children and you take them to the park, and now it's time to get ice cream cones. If you get the ice cream cones and you get two of them and you give them to one child, and then you say, ooh, this isn't fair, let's redistribute, and you pull one cone away from the one child to give to the other, you're creating a level of tension you would never have had to deal with if you'd given each child one cone at the beginning. When we have a government step in to redistribute, we invite intense social struggle, intense social animosities amongst us as a people. It's not smart. And that kind of socialism is constantly bedeviled by struggles among people over a redistribution. You would not have if you distributed less unequally to begin with, let's turn to the second one, the communist alternative. When the government takes over running and owning enterprises and plans the output. Well, there what we have is interesting results. First, these sorts of economies have been stunningly successful in achieving one of their central goals, which is economic growth. I mean, this comes as a shock to Americans, but it has to be repeated so we are not living in a fantasy world. The two most spectacular stories of economic growth of a society going from poverty to wealth in record time is the Union of Soviet Socialist Republics and the People's Republic of China. Wow. Communist China, communist Russia are examples in which having one central authority, the government of mobilize and focus on economic growth, of ending centuries of policy of poverty, have been extraordinarily successful. Those are their achievements. They can get economic achievement on a scale that other societies, both capitalist and the other kind of socialism, the regulatory kind, have not been able to achieve. That has to be faced. That is a virtue of those systems. But they too have their problems. Let's look at them. They generally tend to be less unequal than the other kind of socialism usually can be. So they have that in their favor. But in those societies you have arrogated, you have taken an extraordinary amount of economic power and put it in the hands of a government. And the question has been, and that has been answered now, that putting that amount of power into the hands of the government runs the risk that such a government will use its economic power to also dominate politically and culturally. And remember, if the government takes over the enterprise, it means that instead of the private individuals running the business of the country, it'll be government officials who do it. And that is still a small part of your society. It means a minority. In one case, it's private capitalists, in the other case, its government officials is calling all the shots. And that is politically dangerous. And we've learned that lesson. So in this struggle to ask yourself what life would be like if you were in the first kind of society, a socialism a la Scandinavia, versus the next kind of socialism, the communist variety, as you had it in Russia and China, working people, you and I would have to ask what will life be like in that kind of arrangement. We don't have mass unemployment. We have government services on a scale we don't in other societies. And we have economic growth. But we also have the uncertainties, the instabilities and the concentration of power that might be a problem. Now let's ask what the third kind of socialism would mean for us. A Socialism that focused on the enterprise and the workplace more than on the overall running of the society. What would it mean for you and I to go to work every day, five days a week, nine to five, and walk into a place where we don't just have a particular assigned function, do this work there, live with that machine, do this activity? We would have a particular function, but we would also be part of what owns and operates the enterprise. We would have to be a leader, not a choice. Just as it's not a choice for most people to go to work and do the particular function at the job. You would not have a choice here either, in the sense that a job always means both a particular activity within the division of labor at your workplace, but also your participation in making all of the basic what to produce, how to produce, where to produce, and what to do with the profits that you helped to produce. Just like every other worker, you'd be part of a community at the workplace. You'd have one vote for each person. Decisions would be made democratically. The design of the work, the pace of the work, how you interact with other people on the job. All of those things would be decided collectively and not imposed by a minority. You'd have to think, is that a better way to work? Is that kind of workplace something that has attracted people for centuries to co ops, to worker co ops, to collective forms of labor? What does it mean in your own life? I think the idea of this third socialism is to achieve something in your daily life that the other two socialisms never did. That when the first kind had the government regulation, or the second kind, the communist kind, had the government take over. The transformation of the workplace never happened. You were still the worker who comes and does what he or she is told for the eight hours and then goes home. This is a new world, this third kind of socialism. That's why it's probably the one you're going to hear most about in the years ahead, because it is new and it doesn't have quite the problems that the other ones do. But here are some problems that the new one will have. How do these worker co ops, these communities in each factory, in each store, in each office, how do they interact with one another? Will they use markets to buy and sell from one another? Will they employ some kind of collective planning of how they interact with one another? It will be a new world, this socialism, because it is composed of people who are really in charge of their economic lives in a way that was never true under capitalism and not true under other forms. Of socialism either because they were focused on running the system, on the overall and not on the particular in each workplace. We'll have to discover in this new socialism, if and when it happens, how we interact with one another, when all the details of the work are collectively designed, when everybody is a boss as well as a bossed person, when we rotate whatever particular functions have to be in leadership so that we don't get one group that are leaders all the time and, and everybody else who isn't. All of those things will change. We will have to learn new ways of interacting with one another. But if the idea of socialism really is as it was once said it would be to go beyond capitalism, to do better than capitalism, well, then that third one is by far the most transformative for people's lives of the three that are contesting. But in any case, here's the bottom the next time you hear somebody talk about socialism, pro or con, please be aware and make sure you enter into that conversation knowing that there are different kinds, knowing that they are very important in their different implications for what it means to be a human being and to be an active member of a society. Socialism is on the agenda, but. But more accurately, socialisms are on the agenda. And being aware of them and dealing with them puts you one step ahead of those who think there's one universal kind. There hasn't been for decades and there isn't one now. Socialism is an important topic. That's why we've devoted an entire program to it. I hope this has been useful and interesting to you and I look forward to to talking with you again next week.