Capitalism vs. Socialism

The “public enterprise vs. private enterprise” debate involves many issues . . .

* It can seem like an “either/or” discussion, but it’s not. There are many factors that need consideration. One important such factor is that of scale.

* When the “major means of production” are owned privately, decisions made by their Boards of Directors and managerial staff can affect hundreds of thousands of employees, hundreds of communities where an enterprise has a productive presence, thousands of shareholders, hundreds of millions of consumers, and even economies of whole countries. Given the scope of that impact, should private self-interested individuals or families or investor cliques be in a position of such critical decision-making? Socialists say: Because of the fact that the consequences of those decisions are so socially significant, the decisions should not be made privately — they should be made for the benefit of society as a whole.

* The large industrial corporations are effectively economic empires; all empires tend to be socially and ecologically irresponsible.

* Locally-owned small businesses that are community-based and community-responsive are OK. But businesses tend to want to grow; in fact, they often face a “grow or die” market imperative. Is there a way to keep them small, local, community-based and community-responsive?

* Some socialists say there should be no private ownership beyond the level of sole proprietorship because all wage labor is exploitative in the Marxist sense that the capitalist-owners appropriate “surplus value.” On that basis socialists want to universalize their system. But isn’t it ridiculous to conjecture a world where no hiring of employees by businesses is allowed . . . anywhere, ever??

* The ability to start a business is perceived as a form of freedom; people resented being unable to do so in many of the Communist countries.

* After the revolutions in America and France circa 1780–1800, there was a growing realization that democracy in the political sphere could be vitiated by concentrations of power in the economic sphere. The socialist movement arose in response during the nineteenth century. There were dozens of attempts to put theory into practice during the twentieth century. But not a single implementation of socialism has been enduringly successful. Most of those implementations wound up replacing corporate-based concentrations of wealth and power with state-based concentrations of wealth and power. Compared to the latter, the power of each of the myriad of corporations appears relatively “decentralized.”

* Responding to that, the current neo-socialism emphasizes self-managed worker cooperatives rather than state-centralized bureaucratic enterprises. But it’s not clear that the theories of intellectuals are all so appealing to real workers. It could be that most people would find it burdensome to think that, beyond their job requirements, they should also be expected to take responsibility for making managerial decisions.

* The issues associated with both capitalist and socialist economic relations are such that neither system has “won out” over the course of a debate that now has lasted well over a century. Perhaps neither system merits being universalized. Perhaps in a Green world we would expect to see decentralized polities handling the issue of economic relations in diverse ways — some more socialistic, some based more on private forms of enterprise, some with mixed economies.