What is Socialism - How Socialism Works | Part 1 of 3

Socialism: Government ownership of means of production.
Communism: From each according to his abilities, and to each according to his needs.

In practice, Socialism (and Communism) always degraded to dictatorship. Socialists use democracy to get to power, and once in power, they remove the opposition by imprisonment or killing, and a small government/military elite group dictates virtually everything.

I have lived under Socialist rule, so, perhaps unsurprisingly, I have observed the leftward drift in American politics with some discomfort for years. The Republican Party today resembles the Democratic Party of a couple of decades ago. The alignment of the mainstream media with the political left resembles the Communist Party propaganda in my home country. The majority of young Americans prefer Socialism to Capitalism, and so-called democratic Socialists are gaining acceptance. Clearly, there is some confusion.

Interestingly, if the question is posed as a free market economy versus socialism, the survey participants prefer the free market. So when it comes to thoughts about capitalism/free market economy and socialism, there seems to be a gap between the perception of the meaning of the terms and reality.

I am writing this to address all fellow Americans, but especially to those who tend to vote for Democratic candidates. I am not trying to persuade anyone not to be a Democrat, but I hope to illuminate what Socialism brings when implemented, and to alert everyone to pay more attention to politicians' actions than to their campaign promises.

I am focusing on socialist regimes, since communist regimes are extremely rare in history, even though socialist and communist ideas are closely related, and many leaders of socialist regimes claimed that socialism is only a stepping stone on the way to communism.

In this first blog, I want to summarize the outcomes of socialist regime implementations throughout the world, so the reader has a better idea of what to expect if socialism takes hold in the U.S. I will follow up with more detailed assessments of the major countries that tried socialism, and the last part will be the analysis of the Democratic Socialists of America platform.

Economic Results Across Regimes

The economic record of state-socialist regimes varied, but several patterns recur.

Initial Mobilization

Initially, some regimes with very low economic output achieved rapid gains from that low starting point in:

• Heavy industry

• Literacy

• Basic health campaigns

• Electrification

• Military production

• Female education and employment

• Infrastructure.

This was especially visible in the USSR, China after 1949, some Eastern European countries, Cuba, and Vietnam. However, these gains were short-lived. In cases where socialism was implemented in developed countries after a period of capitalism, stagnation ensued after the socialist takeover, followed by a steady decline in economic output and the availability of goods and services, accompanied by increasing prices and stagnant incomes.

Structural Weaknesses

Centrally planned economies commonly suffered from:

• Incentives to meet centrally dictated quotas rather than consumer needs and suppression of price signals 

• Chronic shortages of basic goods

• Low productivity and poor quality goods

• Agricultural inefficiency and lack of innovation 

• Wasteful investment

• Corruption and black markets 

• Environmental damage   

• Political interference in economic decisions

Some countries improved significantly, but only after market reforms that abandoned the core command-economy mechanisms. China after 1978 and Vietnam after 1986 are the clearest examples, though both countries retained one-party communist political rule, so income inequality and abuse of human rights continued or increased.

Comparison With Market Economies

The contrast between divided societies is historically significant.

• West Germany vastly outperformed East Germany

• South Korea vastly outperformed North Korea

• Taiwan became far richer than Mao-era mainland China before China’s market reforms

• Market-oriented postwar Western Europe grew faster and provided greater consumer abundance than Eastern Europe (My native Czechoslovakia had the 10th most productive economy in the world with just about 14 million people, but it became an economic basket-case within a decade of implementing Socialism.)

Sure, these comparisons are not perfect because geography, institutions, war damage, foreign aid, and starting conditions varied, but they strongly illustrate the long-term weakness of rigid command economies - and there is no example of a command economy outperforming a free market economy.

Human Rights Record

When Americans talk about Socialism, they often bring up concerns about human rights. However, the socialist countries throughout the world have some of the worst human rights records on the planet. The one-party socialist and communist regimes generally restricted or abolished:

• Free elections 

• Independent courts

• Free press

• Independent unions

• Freedom of religion

• Freedom of association

• Freedom to emigrate - Yes, emigrate (leave) as opposed to immigrate. You may want to contemplate why people would want to leave and why they had to be prevented from doing so.

• Opposition parties

• Academic freedom

• Private civic organizations

Common instruments of control included:

• Secret police
• Informant networks

• Political prisons

• Forced labor camps

• Internal exile

• Censorship

• Party control of employment and education

• Propaganda in schools and media

• Collective punishment

• Confiscation of property

• Show trials

• Ideological campaigns

The severity differed between the states, but all used the same instruments of oppression. Stalin’s USSR, Mao’s China, Pol Pot’s Cambodia, North Korea, and Mengistu’s Ethiopia were among the most extreme. Hungary after 1960, Yugoslavia after the Stalin split, and Tanzania under Nyerere were comparatively less murderous but still politically restrictive.

Leaders' Wealth, Privilege & Inequality

Communist and socialist regimes usually claimed to abolish class privilege. In practice, they created a new ruling class: party officials, security chiefs, military leaders, managers of state enterprises, and their families. 

• Special housing

• Country villas or dachas

• Chauffeurs and official cars

• Better hospitals

• Special stores with imported goods

• Access to foreign currency

• Better schools for children

• Travel rights denied to ordinary people

• Protection from ordinary law

• Control over appointments, jobs, and housing

• In some countries, direct corruption and hidden fortunes.

In the Soviet Bloc, privilege was often bureaucratic rather than openly capitalist. Elites controlled access rather than formally owning assets. In places such as Angola, Venezuela, Zimbabwe, and post-Mao China, political connections also enabled enormous personal enrichment.

The gap between leaders and citizens was especially stark during famines or shortages. Stalin’s inner circle, Mao’s leadership, the Kim dynasty, Ceaușescu’s family, Castro’s elite, Mengistu’s regime, and Maduro-era officials had privileged access while ordinary people faced rationing, hunger, poverty, or repression.

Humanitarian Toll

• Famine caused or worsened by state policy

• Forced collectivization

• Mass executions

• Forced labor camps

• Deportations

• Political purges

• Civil wars linked to revolutionary seizures of power or ideological conflict

• State terror

• Suppression of uprisings

• Preventable deprivation caused by policy failure.

Major examples include:

• Soviet famine of 1921–1922

• Soviet collectivization famine of 1932–1933, including Ukraine and Kazakhstan

• Stalin’s Great Terror and Gulag system

• Mao’s Great Leap Forward famine

• Mao’s Cultural Revolution

• Cambodian genocide under the Khmer Rouge

• North Korean famine of the 1990s

• Ethiopia’s Red Terror and famine under the Derg

• Repression in Eastern Europe, including Hungary 1956 and Czechoslovakia 1968

• Cuban political imprisonment and exile

• Venezuelan state repression and humanitarian collapse

• Civil wars in Angola, Mozambique, Nicaragua, and elsewhere

Exact death totals are debated because archives are incomplete, governments concealed evidence, and scholars use different methods. But the total number of deaths caused or worsened by these regimes’ policies in the last century is in the tens of millions.

Conclusion

When Americans speak favorably about socialism, they often imagine a society that provides “free” goods and greater income equality: free health care, free education, perhaps even free housing. But in practice, socialism has never delivered that promised panacea. It always makes people worse off, and the poor usually suffer the most.

There may be less income inequality between, say, a doctor and a laborer—but only because both are made poorer. Meanwhile, the gap between the ruling class and everyone else is enormous.

If you believe that power corrupts—and that absolute power corrupts absolutely—then socialism should be a non-starter for you. Under socialism, a small government elite has the authority to decide nearly everything. That is an extraordinary amount of concentrated power, and given human nature, government corruption is inevitable.

Historically, socialist regimes did sometimes achieve rapid modernization from poor starting points, especially in basic literacy, industrial capacity, public health campaigns, and military power. But these gains came with severe costs (political dictatorship, censorship, forced labor, mass surveillance, coercive economic controls, restricted movement, and recurring humanitarian disasters), and they never lasted.

Economically, command systems could mobilize resources for state priorities but performed poorly at producing consumer abundance, innovation, agricultural efficiency, and long-term productivity. The most successful surviving communist-led states, especially China and Vietnam, improved economically only after introducing major market mechanisms and reducing central planning, effectively moving away from centralized planning and government ownership of means of production, which are the hallmarks of socialism.

Politically, these regimes always concentrated power in a ruling party and its security apparatus. Human rights were subordinated to party control. Leaders and party elites commonly enjoyed privileges far above those of ordinary citizens, despite official claims of equality.

The historical record shows that when socialism was implemented, with state ownership of means of production, central planning, and coercive class politics, the results were authoritarian government, economic inefficiency, elite privilege, and mass suffering.