Chris Freiman, following a suggestion by Jason Brennan, has just published a good post on socialism, showing that socialists are not entitled to define socialism by its goals and aspirations, because that allows them to immunize socialism from real-life catastrophic applications of it. I add, as an afterthought, that in these debates either we are entitled to use real-life examples or we are not. Critics of capitalism like to bring up the bad effects of capitalism and globalization. But when critics of socialism bring up the disastrous applications of socialist ideas, socialists reply that those examples do not count. That cannot be.

Here I make a different point. Socialism is experiencing a bit of a comeback, but it is unclear what its proponents mean by it, at least in the United States. They all agree (I hope) that they don’t want communism, understood as a political system that suppresses both markets and freedoms.

What do they want then? Two possibilities suggest themselves:

1. Perhaps by socialism they mean a political system where the state owns the means of production while preserving liberal freedoms. Call it democratic socialism. Democratic socialism offers the best of both worlds: an equal share of all in society’s material output, and the constitutional freedoms that are so central to our lives and that were denied by communism. Critics of democratic socialism have argued, along Friedmanian lines, that it will sooner or later degenerate into communism because in order to secure its ownership of the means of production the state must use intolerable amounts of coercion and thus suppress freedom. On this view, democratic socialism is empirically impossible. Democratic socialists retort that this is just a problem of technical constitutional design and that it should be in principle possible to preserve freedoms in such a system.
2. Or perhaps by socialism they mean a political system based on robust markets where the state introduces market corrections to provide for the less fortunate, to reduce inequality, and to provide genuine public goods. Call it social democracy. The state actively taxes citizens and intervenes in the economy to provide all these services, but societal wealth derives from capitalist exchanges. Private property, investment, and capitalist profits are protected and encouraged. The usual exemplars are the Scandinavian democracies, Germany, and the like.

I claim that alternative (1), democratic socialism, is unjust, even if it succeeds in preserving freedoms; and that alternative (2), social democracy, is no socialism at all, so its proponents would help themselves (and would stop misleading their audiences) if they dropped the word “socialism” altogether.

Let’s start with democratic socialism. Let’s concede gratia argumentandi that democratic socialists can successfully respond to their Friedmanian critics and design a system where the state owns all means of production while preserving liberal freedoms. Even then, democratic socialism is unjust because it immiserates people. Simply put, democratic socialists have their economics wrong. Empirical and theoretical economists speak in one voice on the causes of wealth and poverty. Societies prosper when people can trade freely with each other and with outsiders. There is not one single case of a successful society that suppressed markets (for summaries of the evidence, see here, here, here, and here). So, if this is what these new socialists propose, it should be emphatically rejected.

The second alternative, social democracy, is not socialism at all. The societies that these new socialists like are strongly capitalist, often more so than the United States. I do not understand why social democrats would want to soil social democracy’s credentials by calling it socialism. To blend together Germany’s marvelous, thoroughly-capitalist productive machinery with the pallid efforts of the Maduros and Kirchners of this world to control their countries’ economies does a serious disservice to social democrats’ cause. Sweden and Germany are capitalist countries, as strong anti-socialist exemplars as you can find.

I conclude, therefore, that the only proposal by these new socialists worth discussing, social democracy (which I don’t compare here with classical liberalism), is not socialism at all, and the other conceivable proposal, democratic socialism, is unjust and must be rejected.