Will the Lie of Socialism’s Success Ever Die?

November 12, 2021 Topic: Socialism Region: World Tags: SocialismCapitalismCommunismSoviet UnionVenezuela

Will the Lie of Socialism’s Success Ever Die?

Left-wing intellectuals around the world insist on telling us exactly the same things as they have been saying for 100 years in the wake of every catastrophic socialist experiment: “That was not true socialism.” Next time, then, things are sure to work out differently.

After every single socialist experiment without exception failed over the past 100 years, it should be clear that the last thing the world needs are any new ones. But as memories of the collapse of real-world socialism in the Soviet Union and Eastern Europe recede, socialist thought is experiencing a renewed renaissance. One of the most respected contemporary leftist philosophers, the Slovenian Slavoj Zizek, unabashedly argues for a "new communism” in his 2021 book, A Left that Dares Speak Its Name. He calls for the rehabilitation of the entire line of anti-liberal thinkers of a “closed” society, beginning with Plato. He goes on: “What is needed is a repoliticization of economy: economic life should be controlled and regulated by the free decisions of a community, not run by the blind and chaotic interactions of market forces that are accepted as objective necessity.” He then writes: “What we need today is a Left that dares to speak its name, not a Left that shamefully covers up its core with some cultural fig leaf. And this name is communism.” The Left, he argues, should finally abandon the socialist dream of a more equitable and “just capitalism” and enact more radical “communist” measures. As a clearly formulated goal, he proposes that “... the opposing class has to be destroyed.”

Zizek extols “Lenin’s greatness,” which lay in the fact that, after the Bolsheviks seized power, he held steadfast to his socialist principles, even though the conditions did not exist for an actual “construction of socialism.” According to the theories developed by Karl Marx and Vladimir Lenin, “socialism” is a necessary transitional stage until the final goal of communism is reached. Zizek suggests reversing this sequence and aiming directly for communism, which should then eventually evolve or regress into socialism. According to Zizek, the "Great Leap Forward" in the late 1950s under Mao Zedong presented an opportunity to “bypass socialism and directly enter communism.” Clearly, Zizek is counting on his readers not knowing that this greatest socialist-communist experiment in human history led to the deaths of 45 million people.

Reigning in and “Improving” Capitalism?

Few are as radical, or as open, in their formulations as Zizek. Many contemporary anti-capitalists have stopped talking about the need to abolish capitalism and have started to call for it to be “reigned in,” “reformed,” or “improved.” Capitalism is portrayed as a wild animal (“predatory capitalism”) that needs to be “tamed.” Intellectuals are constantly thinking up new concepts for “improving” the economic system or limiting its “evils.” Intellectuals who believe they can design an economic system on the drawing board are suffering from the same delusion as those who think they can artificially “construct” a language—but they always insist it needs to happen in service of “justice” or “equality.”

The most recent example of this is the French economist Thomas Piketty. In his highly acclaimed work Capital in the Twenty-First Century, he stressed: 

I belong to a generation that came of age listening to news of the collapse of the Communist dictatorships and never felt the slightest affection or nostalgia for those regimes or for the Soviet Union. I was vaccinated for life against the conventional but lazy rhetoric of anticapitalism, some of which simply ignored the historic failure of Communism and much of which turned its back on the intellectual means necessary to push beyond it.

At first glance, this all sounds quite harmless. However, Piketty is a radical anti-capitalist and advocate of socialism, as he demonstrates in his latest book, Capital and Ideology. In typical constructivist fashion, he imagines an ideal social and economic system, which he calls “participatory socialism” (to distinguish it from the real-world, actual socialism that has failed miserably in twenty-four attempts). He is quite right to call his system “socialism,” because in essence, it is about “transcending the current system of private ownership.”

Specifically, Piketty’s vision includes the following: Every young adult should receive a large sum of money as a gift from the state at the age of twenty-five. This would be financed by a progressive tax on private wealth, which would rise to 90 percent on the largest fortunes, and inheritances, which would also be taxed at up to 90 percent. Of course, Piketty also proposes a correspondingly high tax on incomes, also rising to a peak of 90 percent. And he would also apply this very same tax rate to dividends, interest, profits and rents, etc.  

In order to “transcend” private ownership, Piketty calls for an approach to regulating stock corporations that, at first glance, would seem to echo Germany’s system of codetermination, which gives workers’ representatives half the seats on a company’s supervisory board. However, according to Piketty, this approach has “limitations,” including the fact that shareholders have the casting vote in the event of a tie. If Piketty had his way, he would eliminate this “limitation” by breaking the link between the amount of capital invested in a firm and the shareholder’s economic power in the firm. He suggests that investments beyond 10 percent of a firm’s capital should obtain voting rights corresponding to just one-third of the amount invested.

Of course, Piketty is clear that the owners would leave such a country in a hurry. To combat this, Piketty suggests, the government would have to introduce an “exit tax” (of, say, 40 percent). In effect, this would erect a “fiscal wall” to prevent entrepreneurs and other wealthy individuals who have no desire to live under Piketty’s “participatory socialism” from leaving the country.

Piketty’s example proves the point: Attempts to “improve,” “correct,” or “reform” capitalism that at first seem harmless will always end in pure socialism and a total lack of freedom. The only difference between Piketty’s proposals and conventional socialism is that, under his model, private property would not be nationalized in one fell swoop by order of a single ruling party, rather the same goal would be achieved over a number of years by means of changes to tax and corporate legislation.

A Failed Idea That Never Dies

In his book Socialism: The Failed Idea That Never Dies, German-British economist Kristian Niemietz cites over two dozen socialist experiments, all of which, without exception, ended in failure. In his Lectures on the Philosophy of History, the German philosopher Georg Wilhelm Friedrich Hegel opined: “But what experience and history teach is this – that peoples and governments never have learned anything from history, or acted on principles deduced from it.” Perhaps this judgment is too severe, but it is clear that large numbers of people are incapable of generalizing about historical experiences.

Before capitalism, a vast majority of the global population was living in abject poverty. In 1820, this was the case for 90 percent of the people on the planet. Today, this figure is less than 10 percent. And perhaps the most remarkable feature of this decline is that, in recent decades, since the end of communism in China and other countries, the rate at which people have been rescued from poverty has accelerated more than in any previous period in human history. In 1981, the rate still stood at 42.7 percent; by 2000, it had fallen to 27.8 percent, and by 2021 it was only 9.3 percent.

Many people simply do not seem to want to learn the obvious lessons from the manifold real-world examples that have proved that more capitalism leads to more prosperity. Nor do they seem to want to learn from the failure of all strains of socialism ever tried in the world.

Even after the collapse of most socialist systems in the early 1990s, attempts are regularly being made somewhere in the world to implement socialist ideals. “This time,” socialists claim, “we’ll do it better.” The most recent case is Venezuela, and once again, large numbers of intellectuals in Western countries such as the United States and Germany were enraptured by the experiment to implement “Socialism of the Twenty-First Century.”

Sarah Wagenknecht, a prominent member of Germany’s largest left-wing party, Die Linke, hailed Hugo Chavéz as a “great president,” a man who had dedicated his life to the “fight for justice and dignity.” She thanked Chávez for showing the world that “an alternative economic model is possible.” Chávez had plenty of admirers among left-wing intellectuals in the United States as well, with the late Tom Hayden proclaiming: “As time passes, I predict, the name of Hugo Chávez will be revered by millions.” Princeton professor Cornell West, too, declared himself a fan: “I love that Hugo Chávez has made poverty a major priority. I wish America would make poverty a priority.”

The consequences of the Venezuelan experiment—as with every previous large-scale socialist experiment—were disastrous. And left-wing intellectuals around the world insist on telling us exactly the same things as they have been saying for 100 years in the wake of every catastrophic socialist experiment: “That was not true socialism.” Next time, then, things are sure to work out differently.

Rainer Zitelmann is a historian and sociologist and the author of The Power of Capitalism.