WIXLIB

We can’t concede the end of communism. Communismhasn’t been tried on a society-wide basis.Professor Stephen Resnick, University of MassachusettsThere hasn’t been a shred of socialism in the Soviet Union.[ ] It’s got nothing to do with socialism.Professor Noam Chomsky (n. d.)Socialism is a good idea, which has just been badlyimplemented.From a 2002 survey in east Germany;82 per cent of respondents agreed.A socialist society [ ] doesn’t exist yet, but one day it must.Owen Jones (2016)The primary lesson here is not about [ ] ‘socialism’ or even‘communism’ since Castro, Mao, Stalin, and Lenin did notactually attempt to implement [ ] those ideas.Nathan Robinson (Current Affairs) (2017)Socialism has never been tried.The Socialist Party of Great Britain (1999)The struggle between communism and capitalism neverhappened. The Soviets didn’t establish communism.Professor Richard Wolff, University of Massachusetts

China and Cuba, like the former Soviet Union and EasternBloc, have nothing to do with socialism.The International Socialist Organization (n.d.)Socialism [ ] has not failed, because it has not begun yet.United Left [East German opposition group] (1990)The Stalinist bureaucracy of [East Germany] [ ] discredited the idea of socialism. We, the Spartacists, say: Socialism, under the real leadership of the working class, has noteven begun yet.Spartakist-Arbeiterpartei Deutschlands[East German opposition party] (1990)[T]here is no country in the world today that I would describe as socialist.Eric Ruder, Socialist Worker (2010)[W]hy do we blame socialism? It is not the ideology thatis at work here [in Venezuela], just like socialism wasn’tpracticed during the Soviet Union [ ] If Maduro and hisgovernment truly fulfilled the stated values of egalitariandemocratic socialism, people wouldn’t be starving.Ryan Beitler (2017)

[A]fter seventy years of experience with socialism, it is safeto say that most intellectuals [ ] remain [ ] unwilling towonder whether there might not be a reason why socialism, as often as it is attempted, never seems to work outas its intellectual leaders intended. The intellectuals’ vainsearch for a truly socialist community [ ] results in theidealisation of, and then disillusionment with, a seeminglyendless string of ‘utopias’ – the Soviet Union, then Cuba,China, Yugoslavia, Vietnam, Tanzania, Nicaragua.F. A. Hayek (1988)

TABLES AND FIGURESTable 1Table 2Support for regulation  Distribution of seats in the new People’sChamber  Figure 1Figure 2Figure 3Figure 4Figure 5Figure 6Support for public ownership by sector (in %)  3Support for public ownership by sector (in %)  4Support for price controls by sector (in %)  5Support for a larger state (in %)  7Economic Freedom scores  19GDP per capita (PPP), People’s Republic ofChina vs. Republic of China (Taiwan), 1980–2017  111Poverty in China, 1981–2013 (poverty line 3.10 PPP per day)  111GDP per capita (PPP), Albania vs. Romaniaand Bulgaria, 1985–2017 (in currentinternational )  178GDP per capita (PPP) in Chile and Venezuela,1980–2016  222Oil prices in current US, 1989–2017, bypresidency  224Key governance indicators, 2000–2015  226Figure 7Figure 8Figure 9Figure 10Figure 11xviii6310

Tables and figuresFigure 12 Global GDP per capita over time (in constantinternational 1990 )  Figure 13 Global population and global poverty,1850–2010  Figure 14 Global average life expectancy at birth(years), 1870–2015  Figure 15 Annual number of hours worked per worker  279280281282xix

1THE ENDURING APPEAL OF SOCIALISMIntroduction: socialism is popularSupport for socialism in the abstractSocialism is popular in Britain. Not just among millennials, but also among people in their 30s and 40s. Accordingto a YouGov (2016a) survey, two in five British people agedbetween 18 and 50 years have a favourable opinion of socialism. Another two in five are not sure, leaving only onein five with an unfavourable opinion. Capitalism, meanwhile, has far more critics than supporters in the same agegroup; in fact, it has more critics than supporters acrossall age groups.1In a similar survey, 43 per cent of respondents said thathaving ‘a genuinely socialist government’ would make theUK ‘a better place to live’ (YouGov 2017a). One in five respondents were indifferent or unsure, leaving only 36 per cent whothought that it would make the UK ‘a worse place to live’.1Disapproval of one system does not automatically mean approval of theother. It is possible to be opposed to both, either as a form of nihilism (‘allsystems are bad’), or combined with advocacy of something else entirely.Among those over the age of 65, there is net disapproval of both socialismand capitalism.1

S ocialism : T he Failed I dea T hat N ever DiesIn a complementary survey, only 29 per cent of peoplebetween the ages of 18 and 50 agreed with the statement‘Competition among private-sector companies increasesliving standards for the great majority of people, as it leadsto new and better goods and services, creates extra jobsand keeps down prices’ (YouGov 2017b). But as many as37 per cent agreed with the opposite statement, namely‘Competition among private-sector companies reducesthe living standards of millions of people, because it helpsmainly the rich, leads to poverty wages for many workers,and often results in shoddy goods and services.’ (The remainder answered ‘Don’t know’.)Those findings are corroborated by a recent Populussurvey, which asked respondents about their main associations with capitalism, socialism and various other -isms.Common associations with capitalism include ‘greedy’,‘selfish’, ‘corrupt’ and ‘divisive’ (but also ‘innovative’). Common associations with socialism include ‘For the greatergood’, ‘Delivers most for most people’ and ‘Fair’, termsthat almost nobody in Britain associates with capitalism(Legatum Institute 2017). The most common negativeassociation with socialism is ‘naïve’, a trait which is notreally all that negative, and which some may actually findendearing.222Curiously, while the survey shows positive associations with the term ‘socialism’, it also shows negative associations with the term ‘communism’. Ifwe take the dictionary meaning of those terms at face value, this makes nosense: you cannot logically combine a positive view of socialism with a negative view of communism. In Marxist theory, ‘communism’ is simply thehypothetical final stage of socialism, the stage that is reached when socialism is so advanced that it no longer requires a state apparatus. Presumably,

T he enduring appeal of socialismSupport for socialist policiesTerms like ‘socialism’ and ‘capitalism’ may mean differentthings to different people. But support for socialism in theabstract is also matched by support for individual policiesthat could reasonably be described as ‘socialist’, perhapsnot on their own, but at least as a bundle.Figure 1Support for public ownership by sector (in %)100Public80Private604020–40–60NHSc ShoolRsoyalMaco Ra ilm ilwp a aynieW saterBBCEnBuerscogympaTenieslein phte onrn eet &BanksAirlines0–20–80Source: Based on YouGov (2017c).Industry nationalisations, for example, enjoy widespread popular support. A majority of people favour the(re-)nationalisation of bus companies, energy providers,water companies, the railways and Royal Mail (see Figure 1). Where a sector is already nationalised, such asprimary/secondary education and healthcare, there ismost survey participants associate the term ‘communism’ with the kind ofsocialism that actually existed in Eastern Europe and elsewhere, and theterm ‘socialism’ with the ideal, which, in the minds of many, has not beentainted by its messy real-world applications.3

S ocialism : T he Failed I dea T hat N ever Diesvirtually nobody in the country who wants to change that(YouGov 2017c).3 Earlier, similar surveys show even largerpro- nationalisation majorities for even more industries(YouGov 2016b, 2015a, 2013).Figure 2Support for public ownership by sector (in %)Public100Whatever eoPaSotRlsmsta&oPdsoaRSource: YouGov (2015b).ispoHlstaUtietilissnkBaAnother survey finds that one in four respondents wantto nationalise car companies and travel agents, while onein three want to nationalise food retailing (Legatum Institute 2017).4 Ian Dunt, the editor of Politics.co.uk, was right43Five per cent of respondents say that they want to privatise the NHS. Whileclearly a minority, this is, on the face of it, a lot more than ‘virtually nobody’.However, it is an idiosyncrasy of surveys that every option that is availablewill normally be chosen by at least some respondents. Scott Alexander(2013) calls this phenomenon the ‘Lizardman’s Constant’, a reference to aUS survey where people were asked whether they believe that the world isrun by intelligent lizardmen from outer space. Four per cent replied yes.4The numbers are not directly comparable to the YouGov surveys, becausethe Populus survey does not include a ‘Don’t know’ option.

T he enduring appeal of socialismwhen he said that ‘the public hardly believe in the privaterunning of anything’ (Dunt 2015).For most industries, the pro-nationalisation majorityremains intact even when surveys include an additional,pragmatic-sounding response option such as ‘whateverworks best’ (see Figure 2). This suggests that for most supporters of public ownership this is a matter of principlerather than a belief in the superior efficiency of the publicsector.Figure 3100806040200–20–40–60–80Support for price controls by sector (in %)SupportGas &electricityPublictransportRentsOpposeFood &groceriesSource: YouGov (2013).Price controls are also a very popular policy, a lbeitwith a lot of variation between sectors (see Figure 3).More than seven out of ten respondents support pricecaps for energy and public transport, with fewer thanone in five opposing. In this particular survey, supporters and opponents of rent controls roughly balance eachother, but more recent, similarly worded surveys on thesame subject find large majorities favouring rent controls (see Hilton 2016). There is no overall support for5

S ocialism : T he Failed I dea T hat N ever Dies enezuela-style price controls for food and groceries, butVa significant minority – more than one in three respondents – are in favour of that as well.Government regulation and interference with businessdecisions are also popular, both in the abstract and whenspecific examples are mentioned (see Table 1).Table 1Support for regulationDominant view‘The pay of senior execsshould be capped.’Minority view‘Businesses should paytheir senior execswhat they see fit.’Margin56%‘Government needs to do more to‘Government regulatesregulate how businesses behave.’businesses too much.’32%‘Zero hours contractsshould be abolished.’22%‘Zero hours contractsoffer useful work.’‘Companies have a responsibility‘It doesn’t matter ifto ensure they have a decentthere aren’t anynumber of workers at board level.’ workers on boards.’‘Link people’s pay to thevalue their jobs contributeto broader society.’‘Allow people to get whattheir employers/customersare willing to pay.’15%8%Legatum Institute (2017).A relative majority also supports a larger state, as opposed to the status quo or a smaller state (see Figure 4).The margin vis-à-vis the status quo is not huge, and it isnot consistent over the years. But it is a consistent findingthat virtually nobody in Britain wants the state to be anysmaller than it currently is.Most of these policies are not exceptionally radical ontheir own. A nationalised railway industry or capped busfares would not turn Britain into North Korea. We can find6

T he enduring appeal of socialismplenty of prosperous market economies which have implemented one or more of those policies (although none thathave implemented the whole package).Figure 4Support for a larger state (in %)6050403020100Increasetaxes andspend moreKeep taxesand spendingthe sameReducetaxes andspend lessSource: NatCen Social Research (2017).But what such results do show is that the often-heardclaim that Britain is in the grip of a ‘neoliberal hegemony’is the exact opposite of the truth. In the economic sphere,the zeitgeist is statist and interventionist. Support for freemarkets is an exotic and unpopular fringe opinion. AsAllister Heath, the editor of the Sunday Telegraph, puts it(2017):Spend more, regulate more, tax more: it’s UK politics’stultifying new orthodoxy. Its proponents [ ] set theparameters of our increasingly narrow national conversation. [ ] There is no longer a debate: merely a relentlessassault on capitalism [ ] amplified by ‘centrists’ whokeep conceding to the Left.7

S ocialism : T he Failed I dea T hat N ever DiesThe anti-capitalist mainstreamSurveys provide a glimpse into the mood among the general population. Among the politically most active sections of society, socialist – or at least anti-capitalist – ideashave long been predominant, and highly fashionable. Forexample, all high-profile protest movements in recentdecades – be it anti-austerity, Occupy or anti-globalisation – were explicitly anti-capitalist.5 In 2011, a small‘Rally Against Debt’ in Westminster attracted considerable media coverage, although it was, according to theNew Statesman, only attended by about 200 people.6 Thiswas because it was so counterintuitive. We are so used tothe idea that protest must be left-wing and anti-capitalistthat the idea of a protest against government largesse feelsjarring.Last but not least, the politics/economics sections ofhigh street book stores are also invariably dominated byanti-capitalist literature. The books of Naomi Klein, NoamChomsky, Slavoj Žižek, Yanis Varoufakis, Owen Jones,Ha-Joon Chang, Paul Mason, Russell Brand, etc., are bestsellers within their genre; pro-market books are a rarity.Writers such as Joseph Stiglitz, Paul Krugman or Thomas85This is, at least, the situation in the UK and the rest of Europe. In the US,the Tea Party could be considered a protest movement against governmentlargesse, although it is really a broader coalition in which the social conservatism probably outweighs the anti-statism.6Rally Against Debt? It was more of a long queue, New Statesman, 15 May s/2011/05/rally-cuts-debt-event-lisa-low).

T he enduring appeal of socialismPiketty are clearly politically on the centre-left, but inrelative terms their books are often the most ‘neoliberal’ones one can find in a typical high street bookstore. If thisconstitutes a ‘neoliberal hegemony’, one wonders what aleft-wing hegemony would look like.After the 2017 General Election, the Financial Timesclaimed that ‘Jeremy Corbyn has staged an unprecedented socialist revival’.7 He has done no such thing. Onecannot revive what has never been dead. Socialism hasnever been away; it has just not always been at the immediate forefront of day-to-day politics. It may havereturned there with ‘Corbyn-mania’, but the appeal ofsocialism was never about any one particular politicalcandidate, party or movement.Some readers will probably find it odd that althoughthis book is partly about socialism in Britain, it has nextto nothing to say on ‘Corbyn-mania’, Corbynomics, Momentum, etc. But this follows logically from the recognition that ‘Corbynistas’ are not the radical insurgents theythink themselves to be. They do not, and indeed could not,challenge ‘the prevailing orthodoxy’ because in manyways their ideas are the prevailing orthodoxy. They arejust a political manifestation of a widespread antipathyto the market economy, which long predates them, andwhich will outlive them, in whatever form. When Hayekdedicated his book The Road to Serfdom to the socialists7Jeremy Corbyn has staged an unprecedented socialist revival, FinancialTimes, 9 June 2017 4-c742b9791d43).9

S ocialism : T he Failed I dea T hat N ever Diesof all parties, he knew what he was doing. Today, he wouldprobably dedicate it to the socialists of all parties, protest movements, campaign groups, charities, universities,religious organisations, media outlets and social mediaplatforms.The pervasiveness of socialist assumptionsWhat is perhaps more important than support for anyspecific socialist policy or set of policies is the fact thatsocialist assumptions about economic life permeate ourwhole economic policy discourse. These assumptions arerarely spelt out explicitly, and most people would probablynot even regard them as ‘socialist’ – just as ‘common sense’.Take the above-mentioned support for nationalisingindustries, such as energy or train operators: this need not,in itself, be a socialist position. One can take the view thatmarket competition is generally beneficial, but that somesectors are just not amenable to it (say, due to naturalmonopoly elements). This is not a socialist argument. Butit is not the argument that is usually made.The conventional argument is that ‘profiteering corporations’ are ‘ripping off the public’, and must therefore benationalised in order to make them work for ‘the commongood’. They must be made accountable to the public ratherthan to private shareholders.8 Very few people will regard810For example: Rail privatisation: legalised larceny, The Guardian, 4 November 2013 v/04/rail-privatisation-train-operators-profit). For Tories, privatisation is still a

T he enduring appeal of socialismthis sentiment as ‘socialist’. But for at least four reasons, itvery much is.Firstly, average profit margins in the sectors where support for nationalisation is strongest are only about 3–4 percent.9 This suggests that the argument for nationalisationis not an economic argument at all, but a moralistic impulse – a knee-jerk condemnation of the profit motive. Thisanti-profit moralism is part of a socialist mindset.Secondly, the argument rests on the assumption thatthe public sector is driven by altruistic motives, and thattherefore, whatever is done by the state is done with ‘thecommon good’ in mind. This is a quintessentially socialistassumption. It is also, to say the least, debatable. As economists of the Public Choice School have demonstrated timeand again, self-interested behaviour exists in the public/political sphere as much as anywhere else: senior civilservants trying to expand their budgets and their remitin order to improve their prestige; rent seeking by specialinterest groups; political clientelism; ‘jobs for the boys’ tendencies, etc. (see, for example, Tullock 2006 [1976]).matter of dogmatic faith, Independent, 14 July 2013 f-dogmatic-faith-8708021.html).9The government’s ‘temporary’ energy price cap is bad economics, IEAblog, 19 October 2017 gy-price-cap-is-bad-economics/). Even these margins could notsimply be passed

Despite its long list of failures, socialism remains far more popular than capitalism. The research of Jonathan Haidt, which shows that most political and moral reason-ing is about finding post-hoc justifications for an initial in-tuitive judgement, goes a long way towards explai