Before you read on: Britain's 1945 to 1951 Labour government nationalised industries such as coal. Roughly how much of the economy did it take over?
UK government figures put it at about one fifth. Most firms stayed private, one reason people still debate whether post-war Britain was socialist.
- Core idea
- Means of production owned or controlled by society as a whole, for the benefit of all
- Began
- The word socialist came into use around 1830, for radicals later called utopian socialists
- Key figures
- Robert Owen, Henri de Saint-Simon and Charles Fourier; Karl Marx and Friedrich Engels; Oskar Lange and John Roemer
- Key works
- The Communist Manifesto (1848), by Marx and Engels; Marx's Critique of the Gotha Program (1875)
- Where it shaped policy
- Soviet planning; Britain's Labour government of 1945 to 1951; Scandinavia's mixed economies, a debated case
What it was reacting to
Socialism grew up in the early 19th century as a response to industrial capitalism. Robert Owen, a Welsh mill owner, ran model mills at New Lanark in Scotland and in 1825 founded a cooperative community at New Harmony, Indiana, which failed within a few years. Marx and Engels later called such thinkers utopian, because they drew up blueprints for ideal societies.
The Stanford Encyclopedia of Philosophy sets out the socialist case. Socialists argue that capitalism exploits workers and leaves them under employers' command at work. They add that it spreads income and life chances so unequally that people lack equal opportunity, and that competition weakens people's care for one another.
In place of the old bourgeois society, with its classes and class antagonisms, we shall have an association, in which the free development of each is the condition for the free development of all.
The key ideas
Can you name the four key ideas of socialism?
The means of production are owned or controlled by society: through the state, by each firm's workers, or by cooperatives. The Stanford Encyclopedia of Philosophy adds that control must be democratic; state control without it counts as statism.
Can you think of an example?
Mondragón in Spain's Basque Country, often described as the world's largest cooperative, had over 70,000 worker-owners in 2015.
Marx described two stages after capitalism. In the first, people receive goods in proportion to the work they contribute, after deductions for shared needs. In a later, richer stage, each would give according to ability and receive according to need.
Can you think of an example?
A nurse who works 40 hours gets a certificate for that work, less deductions, and swaps it for goods of equal labour.
Social democracy first meant a peaceful move from capitalism to socialism through elections. Many such parties later settled on a mixed economy: mostly private ownership with large welfare programmes. Democratic socialists, in Britannica's account, want a socialist economy that is democratically run and decentralised.
Can you think of an example?
In its Bad Godesberg programme of 1959, Germany's Social Democratic Party dropped its Marxist aims and backed what it called a social market economy.
Social ownership combined with markets, where prices still guide what firms make. Modern versions include worker-managed firms that compete in markets, and John Roemer's coupon socialism.
Can you think of an example?
In Roemer's scheme, every adult gets equal coupons to buy shares. The coupons cannot be sold or inherited, so ownership stays spread out.