Capitalism, Socialism, Communism, and the Difference Between Social Democracy and Democratic Socialism.


Today, there are a growing number of young people with a positive view of socialism and a negative view of capitalism. According to a recent Gallup poll, 45 percent of young Americans (those between the ages of 18 to 29) view capitalism positively while 51 percent view socialism positively. In 2010, 68 percent of young Americans viewed capitalism positively. This sharp decline is due to a combination of factors, most notably that young Americans have less job security than generations before them and are struggling to make ends meet. On top of that, the cost of living has skyrocketed and the younger generation has no memory of the Soviet Union, which poisoned the very concept of socialism and communism in the minds of the older generation.

Yet some people remain confused about the difference between the various types of socialism. Today, socialists are divided into two main schools of thought. Democratic Socialists, who advocate for the implementation of socialist policies through democratic means, and Social Democrats, who draw on socialist ideas while keeping the capitalist system. Both of these schools of thought advocate for socialist ideas and democracy, yet Democratic Socialism is the more conventionally Marxist of the two.

An important distinction to be made is the difference between Marxist socialism, communism and capitalism. Capitalism is a system which naturally evolved along with the industrial revolution. It was based on private ownership over the means of production and freedom of the individual within the economy. In capitalism there is free competition and no government regulation or interference. Theoretically, capitalism would keep prices down because if a company raised its prices, its customers would flock to the competition. In capitalism those who owned the means of production grew their wealth exponentially while taking advantage of those who worked in their factories and stores. Karl Marx and Friedrich Engels saw this system in the mid 1800s and decided that a new system which was fair to workers and employees was needed. This eventually evolved into socialism and communism.   

Socialism in traditional Marxism is the period between the overthrow of the capitalist system and the implementation of communism. During this period the means of production, capital and agricultural land were taken over by the government. Marxist socialism involved a dictatorship of the proletariat (the workers) and state control of society. For this reason, socialist countries that have existed have for the most part been one party states. Once communism was implemented in the socialist country though, everything would change. 

Communism was a utopian state where there was no class, money, private ownership or even government. Everyone in a communist society would live communally and the community would work to make sure everyone was taken care of. So far, there has never actually been a communist state. No country has ever been able to make that crucial step out of socialism and into communism. The USSR, a combination of socialist states, ended up being ruled by a series of dictators as their goal of implementing true communism was eventually, for all intents and purposes, abandoned.

Democratic Socialism on the other hand is very different than Marxist socialism (despite its similarities). One of the hallmarks of Marxist socialism is the idea that its implementation is the result of a violent revolution against the ruling class. Democratic Socialists instead believe in socialism as a system that is chosen and maintained democratically through elections, instead of a dictatorship ushering in an era of communism. Many different versions of Democratic Socialism exist, with competing ideas of exactly how to go about enacting socialist policies. The most popular Democratic Socialism organization in the United States, the Democratic Socialists of America, believes both society and the economy should be run democratically. This does not mean the Democratic Socialists want an all-powerful state; it means they want individuals to have more of a say than big corporations over how the economy is run. Basically, a socially owned economy. Instead of resources being used solely to make money, they would be used to meet the basic human needs of the country. As they state on their website, “We believe that the workers and consumers who are affected by economic institutions should own and control them.” Unlike policies enacted in some Marxist socialist countries, Democratic Socialists do not believe in a centrally planned economy. Rather, they believe democratic planning can be used for some parts of the economy such as housing and energy, but that “market mechanisms are needed to determine the demand for many consumer goods”. Instead of the government running and owning the entirety of the economy, certain large industries may require some state ownership, but many industries would be run by cooperatives. The goal of Democratic Socialists is to bring corporations and the entire economy in general under democratic control through strong unions, worker control of companies and democratic decision making.

Social Democracy is essentially a watered-down version of Democratic Socialism. It advocates for the implementation of socialist policies while keeping the capitalist system as a whole. This allows Social Democratic countries to easily compete in the world economy. The Scandinavian countries, which Americans tend to think of as examples of successful socialist states, are all Social Democratic countries. Social Democratic states use extremely high taxes on both corporations and individuals to secure free health care, education and high wages for their citizens. They also heavily regulate corporations in order to make sure workers and consumers are not being treated unfairly. As with Democratic Socialism, Social Democrats do not believe in a violent revolution to overthrow the capitalist system, and want their policies implemented democratically. Social Democracy differs from Democratic Socialism, though, in that it does not traditionally advocate for state control over the economy, but simply state regulation of the economy to make society more equal. Social Democracy also advocates for a massive social welfare program. Bernie Sanders calls himself a Democratic Socialist, but in reality, his policies most closely align with those of a Social Democrat. This is because he is not advocating the overthrow of the entire capitalist system through democratic means, but instead the extreme regulation of the capitalist system. Elizabeth Warren is also a Social Democrat (although a slightly less intensely radical one), saying she is a “capitalist through [her] bones,” but also advocating for massive regulation and taxation. 

The difference between political philosophies can sometimes be difficult to understand, especially those as similar as Democratic Socialism and Social Democracy. However, given the context of Marxism, they are fairly easy to differentiate. Democratic Socialism is the implementation of a less extreme form of socialism, with democratic control over the economy. Social Democracy is the implementation of a massive welfare state and government regulation to make the economy fairer while maintaining the basic capitalist system.Miles CohenFebruary 14, 2020

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