Socialism: Not meaning what you think since 1867

Happy inauguration! Did you see the fireworks? Weren’t they pretty?

More importantly, now that Joe Biden has been sworn in, and the Democrats control both houses, is the US about to become a socialist country?

Though it is fairly common in American political discourse for people to use the word “socialism” to describe any policy to the left of what they would prefer – or, occasionally, to describe a policy they just don’t like – “socialism” has a specific meaning, and neither Biden nor the Democratic party have socialism in their platform.

Socialism is an economic system; the contrasting system is capitalism. In a capitalist system, like the one we have in the US, almost all goods are produced by privately-owned firms who set their own production targets and prices. Any firm can choose to make and sell a good, and whether they succeed depends on customers’ demand for the good and competition from other firms.

In a socialist setting, there are no privately owned firms. The population, or, more likely, the government that represents them, decides what goods are to be made and what collective resources (including money, land and labor) will be used to make them. Fees and surplus go back into collective accounts to fund more provision of goods and services, rather than becoming private profit to firms.

The difference between the systems is in whether firms are owned by private citizens or the government. Though socialist systems require government regulation, regulation is not socialism. Just as a functioning democracy can prohibit certain personal behaviors like theft and assault, a functioning capitalist system can prohibit certain firm behaviors like fraud or dumping. Taxes are also not socialism. All governments — socialist or otherwise — tax their populations in order to provide necessary public services that private firms won’t, like highways, national defense, and the law enforcement.

Democrats typically support increased taxation and regulation. However, they don’t advocate taking firms from private citizens and giving them to the government to run. Therefore, they are not proposing socialism.

But what about Medicare for All? Many Democrats want that. Isn’t that socialized medicine? Not really, no. In other countries, where the government owns hospitals, hires doctors and purchases medication, government healthcare could be called socialized (though socializing healthcare would not make the entire economy socialist.) But Democrats don’t want the US government to take over the provision of health care. MFA, and the current Medicare and Medicaid programs, are more appropriately labeled single-payer systems, where the government pays for services from private doctors and hospitals: the government under MFA is a customer, not a producer. Therefore – once again – there is no socialism here.

Regardless of whatever policies a party might propose, any system where citizens are free to form corporations, own businesses, sell goods and put profits into their own bank accounts is a capitalist system, not a socialist one. I do not expect the US to become socialist in my lifetime or yours, no matter who is president.