As discussed on the political-economic systems page, we can identify six types of political-economic systems based on the extent to which they are more or less democratic or authoritarian political systems and have adopted capitalism, socialism, or a mix of both as their economic system. Actual (existing) systems can be identified for five of these categories. The only kind of system that has, to my knowledge, and based on the criteria specified, never been put into practice at the national (state) level is that of democratic socialism. Neither the Soviet Union, China, nor any other country that was or is a self-proclaimed socialist state has been (more or less) democratic. Here, I argue that the non-existence of democratic socialist systems can be interpreted in two main ways: first, at the level of ideology or principle it can be argued that there is a fundamental clash between socialism and the liberal view of democracy; second, at the political level, the hostility of capitalist forces (including governments) towards socialism has not been conducive towards the introduction of democratic institutions in socialist countries. However, this does not mean that, in principle, socialism and democracy cannot be combined. On the contrary, given the limited nature of liberal democracy and the scope for interpreting and applying the idea of democracy much more broadly and meaningfully, it is possible to design socialist political-economic systems that are more democratic than liberal-democratic systems. And whilst we are at it, let us not forget to make them genuinely sustainable.
Socialism: a threat to capitalism
Ideologically, there is an apparent reason why socialism and liberal democracy are clashing and incompatible. One of the key tenets of liberal democracy is the belief in the sanctity of private property rights, whereas socialism rejects capitalism and the private ownership of the means of production. Although socialism does not necessarily imply the rejection of all private property (socialist systems have varied in the extent to which private ownership has been allowed), it advocates (some form of) public or collective ownership of those assets (including the means of production) that are used to exploit people for the sake of expanding capital. In this respect, socialism does not recognise private property as a core element of democracy or democratic rights. By contrast, such private property rights (of land and other means of production) were advanced by liberal thinkers as natural or inalienable political rights at the time of the rise of the capitalist class. Enshrining private property rights in law aimed to provide protection against the power of monarchs to arbitrarily confiscate the wealth of citizens and civilian organisations, a practice that was not uncommon. Although the introduction and strengthening of liberal democratic institutions (including Parliaments, voting rights, and other rights) were also important means for putting checks on the arbitrary power of monarchs, it is the sanctity of private property rights that arguably is the ultimate rationale that underlies liberal democracy. By definition, capitalism does not and can’t exist without private property rights. However, it can happily work, and even flourish, in undemocratic and highly oppressive regimes as long as private property rights are respected.
Capitalism: a threat to socialism
Given the threat that socialism poses to capitalism and the sanctity of private property (of the means of production) proclaimed by liberal democracies, it is understandable that capitalists and adherents of liberal democracy have been hostile to socialism and declared it incompatible with democracy. Liberal democratic governments (especially of the United States) have done everything in their power to suppress, combat and eliminate support for socialism around the world, often under the banner of democracy.[1] Given the many ways and instances in which the governments of capitalist countries have “neutralised” or tried to “neutralise” socialist advocates and regimes, the leadership of socialist countries did not have to be paranoid to think that their regimes were targeted for elimination. Not surprisingly, this has led these leaders to develop a siege mentality, making them inclined to see plots and traitors (supposedly supported by foreign capitalists and governments) everywhere. It speaks for itself that such a situation and mentality are not conducive to (the promotion of) democracy and/or allowing opposition. Marx, Lenin, Mao, and other socialists have consistently been aware of the likelihood that counterrevolutionary and reactionary forces would do everything possible to restore capitalism. Marx foresaw the need for a “dictatorship of the proletariat”, and Lenin argued for concentrating power in the hands of a “vanguard party” to represent and defend the proletariat’s interests. From this perspective, establishing democracy in socialist political-economic systems is only possible if these systems are no longer under threat from reactionary capitalist forces, both domestically and from abroad.
The anti-democratic record of socialist systems
It is against the backdrop of this political struggle between capitalism and socialism that we should interpret the anti-democratic record of socialist systems. This is not to condone the atrocities committed under these regimes. There is always scope and a role for agency, especially at the level of political leadership, which can have enormous consequences for many, if not millions, of people. Yet, it is hard to deny that the creation of socialist systems in a significant number of countries, especially after World War II, led Western governments to actively seek regime change in those countries by all means, including military intervention.[2] Even if those efforts have not always been effective, they arguably contributed indirectly to the undermining of the political regimes in those countries as their repressive and undemocratic institutions and practices led to moral degeneration, corruption, the re-emergence of inequality, disillusionment, and cynicism about socialist ideals, and eventually to the erosion of legitimacy.[3]
Why socialism is not inherently anti-democratic
However, it is essential to recognise that these obstacles to introducing democracy in socialist political-economic systems are not inherent to socialist ideology, but were due to ideological and political antagonism from capitalist-liberal circles. A priori, there is no reason why socialist ideology should be incompatible with the idea and practice of democracy, as reflected in the writings of non-Marxist-Leninist socialists, even before Marx. The key issue here is how democracy is interpreted or defined. Apart from the clash between socialist ideology and the idea that private ownership of the means of production is a fundamental political (or even human) right, socialism is ideologically compatible with political and human rights, including the right to vote, to be elected, freedom of speech, and to justice and “positive” human rights (including a right to housing, education, and health care). Moreover, within the socialist school of thought, which is much less homogeneous and rigid than its opponents commonly portray, other and broader interpretations of democracy can be found that transcend the narrow and limited view of democracy propounded by liberal democrats. Here, I will just briefly discuss a few of those ideas as they have much to offer when aspiring to create not only more democratic societies but also to significantly advance environmental integration, protection, and sustainability. First, socialist thinkers have traditionally conceived democracy as a collective, participatory, and collaborative process towards creating a better society, emphasising shared values, interests, and goals. Second, based on this broad interpretation, there is a long-standing tradition in socialist thought of applying the concept of democracy to the economic sphere.
Socialist views of democracy
Early socialist thinkers, often referred to as Utopian socialists following the label used by Marx and Engels [4], generally shared a commitment to creating a better society in response to what they perceived as the pernicious effects of industrial capitalism. Robert Owen, Charles Fourier, Henri de Saint-Simon, and others shared the belief that it was both desirable and possible to create more just and egalitarian societies, where all members would enjoy a good life. The path towards building an ideal society was commonly based on ideas (or even a specific design) of what such a society should look like, and on the creation of (intentional) communities that, if or when successful, could function as models and thus bring about social and political transformation. Hence, they did not think that a revolution (by the working class) was necessary to create a socialist society, which is why they were characterised as Utopian by Marx and Engels, even though they shared the goal of creating a better (or ideal, communist) society and were influenced in this respect by the early socialists.
Although Marxist-Leninist socialists believed in the need for a political revolution to create a socialist society, many other socialists did not and believed that a better/socialist society could be brought about by a process of (mostly peaceful) reform.[5] But regardless of the differences in strategic thinking about how socialism can or must be established, socialists generally share the goal of creating a society based on cooperation, participation, equality, and solidarity as foundations for human and societal flourishing. Such a society, based on shared values, must and will also be democratic, but in a much broader sense than liberal democracy proclaims. Democracy implies the participation of all citizens in all matters and decisions that concern them (as determined by themselves), on an equal footing, through cooperation and deliberation, rather than by competition based on narrow self-interest. Thus, the socialist notion of democracy is based on self-governance by equal citizens, rather than one of competition between conflicting interests.[6]
Of course, this does not mean that socialists agree on the specific form(s) that democracy should take. There is a wide range of views on this point, among others, about the level and scale of the polities within which socialism can or should be practised or aspired to. Yet, two main ideas about how democracy should be expanded and made more meaningful can be identified.
Public participation
First, while anarcho-socialists argue that socialism can only be achieved in small communities in which the state and all other forms of hierarchy are abolished, those who seek to establish socialism at the national or even global level accept that indirect (representative) forms of participation, and elements of (reformed) liberal democracy, will need to be part of the architecture of democratic institutions alongside new forms, like citizens’ committees or councils. But a common observation that can be found in many socialist writings on this topic is that, once power has been wrested from the dominant liberal-capitalist class, it is up to the people themselves to further develop and introduce the particular forms, institutions, and processes by which they wish to govern themselves. Most recognise that there is little merit in presenting blueprints for democratic socialist systems.
Economic democracy
A second, equally important contribution of socialist thinkers to democratic theory is related to the concept of economic democracy. The idea that workers should have a say in the management of companies, or even collectively own and run businesses, also goes back to pre-Marxist Utopian socialist thinkers, including Robert Owen, who created cooperative communes that became a source of inspiration for the cooperative movement, and Louis Blanc, who sought government support for the establishment of workers’ associations.[7] Although these initiatives mostly failed, the concept of economic democracy has never lost its appeal. It has generated a considerable stream of ideas, literature, debate, and various applications, some of which have been highly successful.
Broadly speaking, these discussions and efforts have focused on two levels: the (micro) level of individual enterprises and/or the (macro) level of the whole (national) economy. The ideas and practices developed under the first focus are often discussed under the rubric of workers’ or industrial democracy. Applications at the national level are commonly labelled as economic democracy, although they are sometimes also discussed under the heading of social democracy. Nonetheless, it must be acknowledged that the principle of economic democracy needs to be developed and applied at both levels if it is to make sense and be effective.
Following in the footsteps of the early or Utopian socialists, who believed that societies could be transformed from the bottom up without the need for revolution, those who focus foremost on industrial democracy examine how workers can be given greater or even complete control over the enterprises in which they work. Ideas and practices on this front include, among others, the creation of workers’ councils or committees to participate in decisions about a wide range of things (from working conditions and work practices to remuneration and investment), the creation of workers’ cooperatives that collectively own and manage enterprises, and the expansion of (shareholding) ownership by workers of existing companies.
Establishing workers’ councils or committees that have a say in how companies are managed is not, in itself, a form of socialism. Such councils have been established in many social-democratic countries, including Sweden, Germany, and the Netherlands, with varied rights and powers, but without a transfer of formal ownership to workers. Thus, they imply a very limited notion of industrial democracy, mitigating the inherently hierarchical structure of capitalist enterprises. Such councils have no control over investment decisions, nor a final say or veto in employment decisions. Yet, it is remarkable that, in many countries, allowing even such a minimal degree of participation of workers in companies’ decision-making processes is often resisted and rejected by employers and hence considered controversial.[8] Nonetheless, the idea that workers must have a say in the management of companies is a fundamental element of the socialist conception of economic democracy. But it should not stand alone.
A more meaningful interpretation of economic democracy involves the transfer of ownership of capital to workers, as well as the granting of control over company management to the collective of workers. This idea, based on the view that it is the collective of workers, including those in management positions, who produce the output and value of a company, makes it only logical that they should also own the company. Even if external financial capital is needed to start or run the company, this can be sourced from cooperative banks or raised through bonds without relinquishing ownership to external shareholders. Ultimately, it can be argued that the collective of workers should have the final say in all matters of importance to the company.
The Example of Mondragon
The concept of economic democracy has been applied in various countries and contexts. Arguably, the most well-known and commonly mentioned example is that of Mondragon in the Spanish Basque region. Founded in 1956 as a small producers’ cooperative, Mondragon has grown into a collective of cooperatives producing a broad range of things, including electrical goods, automobile components, machine tools, and furniture. It also operates a construction division, a retail chain, and a bank.[9] The organisation is based on worker ownership, with initially all workers being members of the cooperative owning personalised capital accounts on which a proportion (45%) of the company’s profits is deposited (with another 45% being set aside for investment and 10% being allocated to charity and community projects). Management was accountable to all members, and the wage differential was 3:1. Its financial management was conservative, with most investments financed from the cooperative’s revenues and bank. Because of its principled approach, cooperative culture, internal democratic structure, and economic success (its companies achieved above-average levels of productivity), Mondragon has often been held up as a showcase for industrial democracy.[10]
Yet, during the 1980s and 1990s, the organisation introduced several significant changes to respond to the growing competition arising from globalisation. Effectively, a decision was made to transform the cooperative into a multinational company, with subsidiaries established in numerous countries. In 2013, Mondragon, which changed its name to Mondragon Corporation, operated more than 120 production plants in 16 countries, including two in India and 13 in China.[11] In 2019, the company employed more than 80,000 people worldwide.[12] Most foreign workers were not members of the cooperative group, resulting in a 2006 percentage of worker-members that fell to less than 40 per cent, compared to 80 per cent in 1990.[13] Although foreign workers were paid slightly higher wages than those paid by competing multinationals in the same countries, and an effort was made to preserve the original principles, including a low wage differential (which rose to 6:1, still small compared to that of capitalist corporations), inevitably, the company’s culture changed. As Malleson states, one can hardly escape the impression that Mondragon’s minority of worker-members “have, in effect, become privileged quasi-capitalist employers of a larger body of nonmember workers.”[14] While the economic success of Mondragon is often held up as evidence that cooperative enterprises can hold their own in the competitive struggle, it also shows that such companies do not fundamentally alter the (global) capitalist system if they are or become driven by the economic growth imperative necessitated by an industrial mode of production and competition in the national or international market. Invariably, this subjugates them to the same pressures to exploit people and the environment that are inherent to the capitalist-industrial system, even if they do so more efficiently and with the consent of the workers. The experience of Mondragon demonstrates that to effectively address the sources of human exploitation and environmental degradation, socialism must be adopted at the national and, ultimately, the global level.
The Case of Yugoslavia
This has long been recognised by many advocates of socialism. Yet, as noted above, thus far, no (nation-) state has succeeded in establishing a democratic-socialist system that has also proven to take the environmental challenge seriously. The only state sometimes referred to as a democratic socialist state (or a market-socialist state, which is not the same) was the former Yugoslavia. Yet, although the Yugoslav experience is very interesting, I will not elaborate on it here, for five main reasons.[15] First, although Yugoslavia, between 1949 and 1991 (when it fell apart), had a nationwide system of workers’ councils that formally promoted workers’ self-management, it constituted at most a minimal form of workers’ democracy as, de facto, much of the decision-making power at the micro (enterprise) level remained in the hands of managers, while all the macro-economic decisions were made by the federal government with little or no contribution from below. Moreover, the Yugoslav political system was not democratic but dominated by the Communist Party (particularly President Tito).[16] Second, the workers’ councils seemed primarily concerned with wage increases and the workers’ standard of living, effectively functioning as enterprise trade unions with little interest in broader issues or the interests of workers from other companies. Third, the companies operated within a market economy, competing with one another and foreign companies. Unlike the Soviet Union, the Yugoslav economy was not based on central economic planning. Fourth, there is no evidence to suggest, as the literature ignores this issue, that Yugoslav companies seriously considered environmental matters. Fifth, the Yugoslav system was not aimed at creating a post-industrial mode of production – boosting production in all sectors was just as much a priority for this regime as it was for socialist and capitalist systems. For all these reasons, and as the country disintegrated in the 1990s, with little written about its environmental integration efforts, the Yugoslav (Tito) regime provides a poor basis for assessing the merits of democratic socialism, let alone a democratic eco-socialist system. Instead, as suggested above, it was a form of market socialism, even though it is hard to locate the socialist element in such a system.[17]
Designing sustainable democratic socialism
Hence, we can’t point to a real-life example of a democratic socialist system at the national level, let alone one that integrates the environmental challenge fundamentally and is oriented towards developing a post-industrial production system. To decide whether it is possible to design such a system, its main elements, and how it could be turned into reality are questions that can only be answered in tentative or even speculative ways. Many thinkers and authors have taken up this challenge, with many professing a commitment to eco-socialism. While many of the contributions on this front are interesting and important, quite a few appear to be aimed at proving that Marx was an environmentalist and/or that socialism is an ideology that is (most) compatible with, conducive to, or a necessary or even the only basis for creating a sustainable and socially just world. I agree that capitalism is incompatible with long-term environmental sustainability and that socialism, in principle, is compatible with the need to prioritise the protection of the environment (which has a social dimension) alongside social justice. The fact that actually existing socialist political-economic systems have mostly failed on the environmental front is not convincing evidence that socialist systems can’t integrate environmental concerns. Anyone who makes that argument must also write off capitalist political-economic systems. However, although capitalism has an internal logic that makes it environmentally incompatible, this is not the case with socialism.
I will not discuss the diversity of views on what an eco-socialist society can or should look like. Instead, I will highlight three points that are crucially important but often do not receive the attention or weight they deserve.
The need for sustainable production systems
First, to the extent that socialist ideology is built on the assumption that socialism can only be achieved once a society has developed a substantial industrial basis, it can be regarded as being out of line with environmental imperatives, given the unsustainability of the industrial production system. Additionally, given that actual socialist systems have been hooked on industrialism and developed the materialist values and norms of an industrial society, the question remains: what kind of (post-industrial) production system should advocates of socialism strive towards or put in place?
Given the importance that Marxists assign to the “forces of production” and “modes of production”, the relative neglect of this question is somewhat surprising. “Just” abolishing capitalism is not enough to move towards a sustainable world, and neither is an emphasis on reducing inequality and arguing that capitalism needs to be replaced by rational economic planning or management. The challenge of creating environmentally sustainable production systems that do not require continuous growth raises issues about how sustainability is defined, technology, the scale of production, what is produced (and not), how resources are allocated, the role of markets (which does not imply accepting capitalism), the role of finance (if any), the relations and organisation of work, living standards, income distribution, and many more questions, including how decisions are made on these questions and by whom. As the mode of production is fundamental to a society’s social relations, the technical, social, ethical, economic, environmental, and political issues it raises all need to be considered together.
Whether or to what extent an industrial production system can be transformed so that it loses its inherent expansionist logic and becomes entirely or mostly ecologically rational and socially desirable (in terms of production relations and work conditions) is a big question facing both capitalist and socialist economic systems. Simply combining a socialist ideology with a pro-environmental or green stance is not sufficient for creating a sustainable political-economic system. To achieve the latter, socialist economic systems will need to be based on an alternative (non- or post-industrial) production and consumption system that significantly reduces the material and ecological footprint of existing systems and the world as a whole in absolute terms. Again, one would think that, in principle, designing, adopting, and implementing such an approach is more compatible with a rational and planned socialist approach than with capitalist rationality.
The need for a broad social support basis
Second, related to the first point, it is debatable whether or to what extent the creation of an (advanced) industrial system is a necessary condition for the transition to socialism. This was an assumption that Marx made based on the idea that an industrial working class provided the social (class) basis for bringing about (revolutionary) change towards a socialist society. However, as the experiences in Russia, China, Vietnam, Cuba, and other countries have shown, socialist systems have been established primarily in countries that did not (yet) have a sizable industry and working class. Instead, the social support base for the transition towards socialism has been broader, including, among others, farmers, intellectuals, idealists of all kinds and professions, and workers. Thus, the creation of socialist societies has always relied on the power of a broad coalition of social and political forces rather than just the (industrial) working class. It is highly likely, given the erosion of the (power of the) industrial working class in many “advanced” countries, that a transition to a democratic socialist system is only possible if and when supported by a very broad, varied and overlapping coalition of groups, including “service” workers from a wide variety of sectors (including IT, education, health, retail, the media), the public service, as well as industrial workers (building, energy and transport infrastructure, other industries), minority groups, and last but not least, those concerned about environmental degradation, social disintegration, and the erosion of democracy.
Democratic socialism at the national level
Third, although this may seem obvious, it is highly unlikely that the world will move towards adopting socialism at the global level, let alone through a worldwide revolution. Apart from the fact that socialist ideology has been in retreat for much of the past fifty years, the highly fragmented and geopolitical nature of the global order makes it extremely difficult to convert the whole world, or even all the major countries, to socialism, and certainly not all at once. Moreover, it is hard to imagine what a global socialist order or system would (have to) look like, even if the whole world were to choose to or be forced to accept the creation of such an order. The idea of developing a global economic system that addresses all the questions referred to above (and more), and of adopting an economic plan that sets out the goals, objectives, and targets for each country or (geographical) region in the world, is likely to sprout a rationalistic, technocratic, social, and political nightmare. Even or especially if such efforts were to be assisted by artificial intelligence (AI), they are bound to lead to dystopia. A planning approach based on scientific rationality, even if circumscribed by socialist and environmental or ecological principles, may not lead to the kind of society and world that most people want to live in. To achieve the latter, meaningful democracy is essential. Realistically, democratic socialism is only possible at the national level as states remain vitally important for meeting the needs and demands of people, and for doing so in more or less democratic ways.
References
[1] Chomsky, Noam (1992), Deterring Democracy. London, New York: Verso; Huberman, Leo (1968), “The ABC of Socialism”, in L. Huberman and P. M. Sweezy (eds.), Introduction to Socialism, 21-81, 79.
[2] The reality of this threat was, of course, clearly illustrated in the case of Cuba, where an American-led invasion took place in 1962 (in the Bay of Pigs) but was defeated. The CIA also undertook several attempts to kill Fidel Castro, the Cuban leader, again to no avail.
[3] For powerful accounts of the degeneration of socialism in the Soviet Union, which contributed to its ultimate demise, see Djilas, Milovan (1957), The New Class. An Analysis of the Communist System. New York: Praeger. Also, Sarkar, Saral, Eco-Socialism or Eco-Capitalism? A Critical Analysis of Humanity’s Fundamental Choices. London and New York: Zed Books.
[4] Engels, Friedrich (1892; 1970), “Socialism: Utopian and Scientific”. In Marx/Engels Selected Works. Volume 3. Moscow: Progress Publishers, 95-151.
[5] Apparently, Marx himself later changed his mind and believed that in some advanced capitalist countries, where the socialist movement had built up considerable strength (such as the Netherlands), a peaceful and legal transition to socialism was quite possible. Sweezy, Paul M. (1968), “Marxian Socialism”, New York and London: Monthly Review Press, 85.
[6] Albert, Michael (2003), Parecon: Life after Capitalism. London: Verso; Fotopoulos, Takis (2009), “The Multidimensional Crisis and Inclusive Democracy”, The International Journal of Inclusive Democracy; Lebowitz, Michael A. (2016), “What Is Socialism for the Twenty-First Century?”, Monthly Review, Vol . 68, No.5, 26-43.
[7] Wikipedia (2021), Louis Blanc, https://en.wikipedia.org/wiki/Louis_Blanc (Accessed: 9 February 2021). Brown, Archie (2013), “Pre-Marxian Communist Ideas”, in M. Freeden, et al. (eds.), The Oxford Handbook of Political Ideologies. Oxford: Oxford University Press; Engels, Friedrich, “Socialism: Utopian and Scientific”; Wikipedia (2021), Robert Owen, https://en.wikipedia.org/wiki/Robert_Owen (Accessed: 9 February 2021).
[8] It is indicative that in a relatively recent work on economic democracy, it is deemed necessary to spend a whole chapter on justifying even such a minimal degree of economic democracy. Malleson, Tom (2014), After Occupy. Economic Democracy for the 21st Century. Oxford: Oxford University Press, Chapter 2.
[9] Blackburn, Robin (2007), “Economic Democracy: Meaningful, Desirable, Feasible?”, Daedalus, Vol . 136, No.3, 36-45; Hutchinson, Frances, et al., The Politics of Money. Towards Sustainability and Economic Democracy. London: Pluto Press.
[10] Malleson, Tom, After Occupy. Economic Democracy for the 21st Century. Oxford: Oxford University Press; Whyte, William, F. (1999), “The Mondragon Cooperatives in 1976 and 1998”, Industrial & Labor Relations Review, Vol. 52, No.3, 478-481.
[11] Murray, Robin (2012), “Cooperatives and Global Growth: The Case of Mondragon”, in M. Kaldor, et al. (eds.), Global Civil Society 2012. Ten Years of Critical Reflection. Houndsmill, Basingstoke, Hampshire: Palgrave Macmillan, 146; Wikipedia (2021), Mondragon Corporation, https://en.wikipedia.org/wiki/Mondragon_Corporation (Accessed: 11 February 2021).
[12] Wikipedia, Mondragon Corporation.
[13] Malleson, Tom, After Occupy. Economic Democracy for the 21st Century, 64.
[14] Ibid., 60.
[15] For helpful brief discussions and assessment of the Yugoslav experience with workers’ councils, see Singh, Parbudyal, et al. (2007), “The Yugoslav Experience with Workers’ Councils: A Reexamination”, Labor Studies Journal, Vol.32, No.3, 280-297; Marković, Goran (2011), “Workers’ Councils in Yugoslavia: Successes and Failures”, Socialism and Democracy, Vol.25, No.3, 107-129; Devine, Pat, Democracy and Economic Planning. Oxford: Polity Press, 94-100.
[16] Djilas, Milovan, The New Class. An Analysis of the Communist System. New York: Praeger.
[17] Marković, Goran (2011), “Workers’ Councils in Yugoslavia: Successes and Failures”; Bockman, Johanna (2011), Markets in the Name of Socialism: The Left-Wing Origins of Neoliberalism. Palo Alto, US: Stanford University Press, Chapter 3.