Defining socialism (and related terms)

I have written twice about socialism without taking the effort to define my terms. That shortcoming needs to be corrected.

Briefly, socialism describes a society in which the means of production are controlled by the government, or the state. This distinguishes socialism from capitalism—in which the means of production are privately owned—and communism—in which the means of production are commonly owned without control from the government or the state. Based on nineteenth century European philosophy and its aftermath, the idea of socialism can be further divided into three categories.

Means of production include any source of wealth and any production of items that are needed and wanted by members of the community. Farms are the primary means of production for most of history. Factories and businesses have become means of production in more recent times. A shoemaker’s shop, a pharmacy, and a railroad are all examples of means of production. If the government owns and operates these means, socialism is present. Mere regulation by the government of these means is not, strictly speaking, socialism (but see further development of this thought below).

Utopian socialism occurs when a group of people establishes a business or a set of businesses within a community and places them under a governing authority. Several small-scale attempts to establish utopian socialism were tried in the nineteenth century. Even some twenty-first century companies retain elements of utopian socialism—when workers are given stock in the company or other ways of receiving a share of the company’s profits, and when workers are invited to take part in the decision-making process of the company’s boards.

In many cases, utopian socialism remained dominated by the owners of the company, leading to the further subjugation of the workers. In the Pullman neighborhood of Chicago, the Lee Wilson & Company plantations of northeast Arkansas, and various other establishments and businesses, the company owners not only built factories and storehouses. They also built homes for the workers, stores where the workers shopped, schools for the children of the workers, and even churches for the workers and their families. Company owners controlled prices charged in the stores and messages delivered in the schools and churches. Company currency was paid to the workers instead of money that could be spent off company property. The detriment to workers is illustrated by the song “Sixteen Tons,” in which a worker sings, “Saint Peter, don’t you call me, ‘cause I can’t go—I owe my soul to the company store.”

Revolutionary socialism sought to prevent that lack of control by overthrowing the company owners and placing control of the companies directly into the government’s hands. A class of capitalist businessmen, politicians, and other leaders was to be attacked and stripped of power so the workers could gain full control of the means of production. The government, it was thought, would run the farms and factories and other businesses more fairly, giving more of the wealth to the workers since it was keeping less of the wealth to itself. Some revolutionary socialists, including Karl Marx, viewed revolutionary socialism as a temporary condition, one that would become communism (see below) as the government withered away, granting more control of the means of production to the workers. Other revolutionary socialists expected the government to remain, to continue to control the means of production, but to treat the workers more kindly than the capitalists had done in earlier times.

Gradual socialism hoped that the government could assume such control over the means of production without a violent uprising by the working class, and without a violent overthrow of businessmen and politicians. Through increasing government regulation, advocates of gradual socialism hoped, the government could strip capitalist businessmen of their control of the means of production, effectively placing that control in the hands of the government. Not all regulation of businesses is done with the goal of gradual socialism; much legislation has intentions that are not at all related to socialism. But proponents of gradual socialism use government regulation as a means to remove control of the means of production from business owners and to give the government full control of the national economy.

Communism differs from socialism in that the workers directly control the means of production without a government interfering with their control or making decisions on their behalf. Karl Marx wrote that revolutionary socialism would be a temporary step on the road to full communism. Because of his theories, revolutionary socialists in Russia, China, Cuba, and other places identified themselves as a Communist Party, holding out the promise that their government would concede control to the workers over time. That never happened in any of those places.

Communism can be practiced by a small group of people who combine their resources to meet all of their needs. The early Christian Church practiced that kind of communism. Wide-scale communism on a national level has never been achieved. When a revolutionary government established control of the means of production, it retained that control unless and until it was overthrown by a second revolution.

Capitalism teaches that control of the means of production must remain in the hands of the investors, who conduct their businesses for their own profit, but who compete to offer the best conditions for both workers and customers. Capitalism was historically expressed by Adam Smith in his Wealth of Nations. People used to believe that wealth was limited, that one person could gain wealth only if other people lost wealth. Smith demonstrated that labor increases value and wealth is not stagnant. If a person finds a diamond, that person has received wealth. If a person pays a jeweler to cut and shape that diamond, the gem is smaller but much more valuable. Both the finder and the jeweler become more wealthy.

Smith wrote that capitalism thrives when governments do not interfere with the economy. He defended the idea of laissez-faire, or “leave it alone.” Pure capitalism would insist that the government exercise no form of control over the means of production in the national economy. But even Smith understood that some government regulation is good, beneficial, and necessary. The result of a capitalist economy with some government participation is called free market capitalism.

In the free market, the government does regulate the means of production to a certain extent. Pollution of the air, land, and water is limited through regulation. Safety of the products sold to consumers is regulated through inspections. Safety at the workplace and other benefits for the workers are also regulated by the government. Workers and consumers both benefit from some government regulation, while investors continue to benefit from their part in the means of production and the growth of the economy.

In free market capitalism, business owners and investors benefit from competing with each other for workers and for customers. They choose how much to pay their workers and what other benefits to offer their workers. They choose how much to charge for their products, and they also make choices about the quality of their products. All of these choices are shaped by the availability and cost of raw materials, the availability of workers, and the interest of customers in their products. Workers and customers also make choices among the options offered to them. As long as businesses compete for customers and for workers, good jobs continue to be offered, and affordable, good-quality products continue to be bought and sold.

To preserve the free market, governments sometimes act to prohibit or break apart monopolies, trusts, and cartels. Such business practices limit choices for workers and customers by placing control of the means of production into the hands of too few people. Standard Oil and AT&T were divided by the government for the benefit of workers and customers; social media providers may face similar legislation in the near future. The government acts slowly and deliberately when it considers challenging a monopoly in free market capitalism. On the other hand, no agency exists to police the government when it holds control of the means of production in a socialist system. J.

First Friday Fiction: The Last King of Caspinistan

Why did the king admire Benjamin Jackson? Perhaps he appreciated the fact that Benjamin was the first person he met who neither groveled before him nor frowned at his wealth and his power. For that, the king welcomed Benjamin with neither pity nor magnanimity. Because Benjamin was American, the king was prepared to be treated as an equal, and he was not disappointed.

Why the king sought an American pen pal is a small mystery that will never be solved. Why Benjamin applied for a pen pal from overseas is equally unknown. The larger mystery—but the one most easily explained—is how two young men, worlds apart, were matched to one another. Their applications arrived at the international pen pal agency the same day and were opened by the same clerk. No further explanation of their opening correspondence needs to be sought.

The clerk mistakenly identified the king as Carl King, an error that the king hastened to correct in his first letter to Benjamin. His father had named him for Charles the Great of France, believed to be a distant ancestor of the royal family, although historians doubted the connection. King Carl wrote without shame of all he had inherited when his father died three years earlier: the palaces, the servants, the monthly gifts from his people, and the responsibility of running a nation. Benjamin, in return, wrote without bitterness of his life in Canterbury, Iowa. Benjamin was the only son of a widowed farmer who had finally sold the farm to pay his debts and bought a small house in town. Randy Jackson now worked for a small manufacturing plant in Canterbury. Benjamin was fifteen years old and attended the Canterbury High School. King Carl was twenty-five and had never seen a manufacturing plant or a high school. His tutors had taught him fine arts and several languages, including English, French, and German. At his father’s suggestion, the tutors had covered ancient and medieval history, world literature, and some basic natural sciences, but they had avoided such esoteric arts as political science and economics. King Carl was skilled in archery, fencing, swimming, and various equestrian activities; but his sense of current events was fuzzy at best, and he had no head for geography whatsoever.

Benjamin’s first letters to King Carl were probably destroyed during the revolution, when the palace was burned to the ground. Benjamin may have saved his first letters from King Carl, although no one else has seen them. Clearly the two of them did exchange letters, though, trusting at first to the postal systems of the United States and Caspinistan. Eventually, the thought of meeting his pen pal from Iowa grew from a royal whim to a desire. Benjamin was invited to the palace of King Carl. Probably then the king obtained detailed information about Benjamin’s private bank account, for suddenly the young man had sufficient funds to buy a plane ticket and travel out of the country for the first time in his life. This access to Benjamin’s account might explain much of what was to happen some years later.

Benjamin bought a series of tickets that sent him to Athens, Greece, by way of New York and Paris. In the Athens airport a courier from Caspinistan met Benjamin and escorted him to the king’s private jet. After an additional flight, the fourth leg of his journey, Benjamin arrived at the Caspinistan national airport, which lies north of Alkhasad, the capital city of Caspinistan. The king’s personal chauffer was on hand to drive Benjamin to the palace in the king’s royal Cadillac. The journey took them farther away from the city, so Benjamin did not see how the people of Caspinistan lived. Nor did he have an opportunity to measure their reaction to the sight of the royal car. All Benjamin saw of Capinistan was forested hills, meadows filled with flowers, and of course the royal palace. King Carl himself was on hand to greet Benjamin when the royal car stopped at the entrance to the palace. He folded his pen pal into an exuberant embrace, and he insisted immediately on conducting a personal tour of the palace and its grounds.

Benjamin looked a few years older than fifteen. Hardened already by Iowa summers and winters, his eyes maintained an eternal squint. Sandy-haired and broad-shouldered, he had the stride of a mature man. King Carl looked a few years younger than twenty-five. His dark eyes twinkled with pride and with unabated humor, and he gestured wildly to point at everything in sight. His dark hair, carefully groomed, still refused to remain in place as he practically skipped from room to room in the palace. When he could not find an especially beautiful piece of furniture or particularly fine painting to admire, he began listing the number of servants in the palace and the cost of feeding them each day and clothing them each year. “It costs a bundle,” he lamented, shaking his head with mock sadness, “but such are the affairs of royalty.” All the same, the cares of state had not robbed his majesty of a youthful zeal for royal life and all that it contained.

“All this is yours, because you are the king,” Benjamin remarked—not a question, but merely a statement of fact.

“Of course, old friend,” King Carl exclaimed, patting Benjamin on the back as they strolled through the rose garden.

“And you use it,” Benjamin continued, “to maintain a corps of cooks and maids and gardeners.”

“And seamstresses, tailors, three butlers, four horsemen, tutors for the children, a series of valets (changing every three months), a chauffer…”

“Have you ever considered,” Benjamin interrupted, “how little you get in return for all this money?” The king stared in amazement. “Have you ever considered,” Benjamin continued, “how much more productive your money could be if you put it to work for you instead of giving it away?”

“How do you mean?” the king inquired.

Benjamin’s history and economics teacher back in Canterbury, Iowa, had ingrained the virtues of capitalism into the minds of his brighter pupils. Mr. Dillard admired the virtues of John D. Rockefeller, Andrew Carnegie, and Sam Walton. “Hard work is no shame,” Mr. Dillard frequently preached, “and money without work is no virtue. Money exists to work for you. When money does its job, you have more money, and you’ve done something worthwhile into the bargain.”

Now Benjamin tried to repeat to the king the lessons he had learned at Canterbury High School. “A rising tide lifts all the boats,” he proclaimed. “The more you do with your money, the more it will do for you. And meanwhile your people will prosper with you.”

On occasion the king had been vexed that there was only so much wealth to go around in Caspinistan, that the more he had, the less there was for everyone else. He had never thought of a fair way to change that problem. Now, told that he could become even richer while seeing his people increase their possessions too, he was fascinated. During the next week, Benjamin quizzed the king about the products of Caspinistan. “We sell wood from the forests, and somewhere fine furniture is crafted from our wood. We raise flowers and sell them. A few are worn as ornaments or used to decorate tables until the fade, but many are boiled somewhere to produce an expensive perfume. We have some very valuable metals buried deep in our hills. Companies have bid for mining rights, and then they have brought their workers, taken what they wanted of our metals, and left the mines empty.”

“It never had to be that way,” Benjamin explained. In that same week, he described for the king the Industrial Revolution and the many jobs that industry could provide. “You have rivers that can generate electric power. You can build factories and make your own furniture and perfume. Instead of taxing your people for a share of what little they have, you can offer them jobs and then tax the things they make and sell. You will have more than ever before, and they will have more too.”

The king was a fast learner. Before Benjamin had left Caspinistan, King Carl had already bought books and began to study. Not long afterward, he hired five consultants to assist him with his plans. Not long after Benjamin had reversed his course, traveling through Athens, Paris, New York, and home, the king had begun to industrialize Caspinistan.

Benjamin, of course, never saw the bulldozers enter the green forests and flowery meadows of Caspinistan. He never saw the peasant’s huts in Alkhasad leveled to make room for the new factories. He was not a witness to the two grand hydroelectric dams that spanned the rivers to power the factories. As Benjamin finished his last two years of high school, letters continued to flow between Canterbury and Caspinistan, and Benjamin read how the people grew richer every day, how furniture crafted in Caspinistan was already being sold in the cities of Europe and Asia, how the secret of the perfume had been procured, with production carefully limited to keep the price high. He read how King Carl truly did find himself richer than all his ancestors because of the prosperity of Caspinistan. In return, Benjamin was able to attend the college of his choice in the United States, and he never had to ask a single question about financial aid. He bought a new car, and his father Randy paid off his back debts and bought a pick-up truck. People wondered how the Jacksons were able to afford two new vehicles at once. Because both vehicles were Chevys, nothing ostentatious, not many questions were asked around Canterbury.

A Wal-Mart store was built in Alkhasad, and a McDonalds restaurant opened inside the Wal-Mart. Fancier grocery stores replaced the old family food shops in even the smaller villages of Caspinistan. Shoppers could choose between Coke and Pepsi, or even between Budweiser and Coors. Televisions were sold and satellite receivers appeared next to houses all over the country. The citizens of Caspinistan bought laptop computers and hand-held devices of every kind. Though King Carl’s advisors had always carefully watched the one national newspaper and monitored the one national radio station, they had no way to keep track of the many kinds of messages that were bring exchanged inside the country and over the borders with the new technology. The king was delighted that the people were investing their new wealth in all these modern devices, because every time a television or a computer was bought, the sales tax enriched his treasury.

The revolution began within three weeks of the date predicted by United States intelligence reports. Quiet gatherings in the streets grew larger each night, as the people demanded a new constitution which would give them a voice in their government and freedom from fear of the police and military forces. At first the heads of those forces were inclined to disperse the gatherings, even with the threat of violence if necessary, but the king told his three generals not to send their soldiers to fight their own fellow citizens. In a radio and television address carried all over Caspinistan, he offered compromises to his citizens, but the gatherings only grew even larger. Sensing the king’s weakness, some soldiers and police officers lay down their weapons and joined the people. Others joined the people but kept their weapons. Government buildings were entered, looted, and burned. Even inside the king’s palace, the rumble of unhappy crowds could be heard both day and night.

King Carl left Caspinistan by jet one summer night. He left behind his wives and his children with no more visible regret than he felt for his palace and his cars. A morning of rejoicing led to a lawless afternoon of rioting and pillaging before the army seized control of the country with a promise to schedule elections for the fall. Two nights of violence followed before order was finally restored. A group of scholars met with the three generals to write a new constitution. Districts were hastily drawn to create the structure for a representative government. The stores and factories were closed for a few days, but in barely more than a week, the country was operating smoothly again.

King Carl’s jet landed at O’Hare airport in Chicago. Five hours later, the pilot offered the jet to American authorities and requested asylum. By that time, King Carl had rented a Lincoln Towncar from Hertz using a credit card belonging to one of his five aliases. Whether through luck or cleverness, the king did not u se that alias again, not even to purchase gasoline. The car and its driver were never found.

Carlos Reyes appeared at the Jackson home in Canterbury, Iowa, on a Tuesday afternoon. He looked at their four small rooms, visited with Randy and Benjamin for a couple of hours, and then rented a room at the Days Inn on the highway. The next morning he visited with the manager of the Days Inn, made a few phone calls, and bought the entire motel. Carlos Reyes now had everything he really wanted. He owned an American mansion with twenty rooms, as well as twenty full bathrooms, an outdoor swimming pool, a large fancy dining room, and a fully-stocked kitchen. He had a trained staff to keep the place in order. Carlos kept on the entire cleaning staff. He kept a crew to manage the grounds and the pool. He kept most of the kitchen staff, with two waitresses who took turns serving lunch and dinner to Carlos and his guests. The manager remained to serve Carlos breakfast in bed, to turn away travelers with the regretful news that the motel had no vacancies, and to pay the bills. The manager did not ask how money appeared in the motel’s bank account; he merely used it to pay the bills. He also gave himself a generous raise, and no one asked him any questions either.

On Wednesday, Carlos bought a yellow Corvette. On Friday he completed negotiations to purchase the manufacturing plant on the edge of town. Some employees were kept, but others were released. Randy Jackson was promoted to manager of the plant. Trucks began delivering pieces of furniture to be assembled and finished. The good people of Canterbury whispered rumors of Mexican drug money, but no open accusations were made.

Meanwhile the rebels in Caspinistan reopened the factories, not realizing that the man who led them was uncle to the missing king. Exports again flowed from Caspinistan, including furniture, perfume, and rare metals. King Carl’s father had a younger brother who had regularly functioned as the king’s link to the outside world, traveling among the people and sending coded messages to the palace with reports of what was being said and done in the country. When the king died, the new king’s uncle, named Pepin, continued to spy on the people for the throne. Pepin had realized very early that a new spirit was sprouting and growing in the land, a spirit that called itself liberty and freedom, but a spirit that could very easily lead to anarchy and destruction. Pepin, under a different name, made himself the friend of the more outspoken of the rebels. At the same time, he carefully cultivated ties to the three generals and ties to the factory managers and to their clerks. In the early demonstrations, Pepin was careful to be seen in the streets, shouting slogans with the rest of the crowd. Later he worked behind the scenes, leading nothing, but making himself indispensable to all. He developed a network of old sources and new sources, and no one but Pepin himself knew all the links and connections in his network. Overseas contacts were part of its structure, carrying the exports of Caspinistan to markets in five of the world’s continents.

The twenty-room mansion of Carlos Reyes in Canterbury, Iowa, began to look more like a motel again. Up to four of the rooms were frequented by guests, businessmen in suits who carried cases of important documents. The motel restaurant remained Carlos’ private dining room, but he frequently entertained large groups of visitors, needing help from additional waitresses hired from town. Though he did not travel, Carlos remained intricately aware of international politics and business. He did not obtain his information from newspapers or from television news; what little data and analysis he gained from those sources only drove him to scornful laughter.

Carlos was found dead in his favorite room one morning, mere hours after his uncle Pepin was assassinated in Alkhasad. Local police made the discovery, but federal agents quickly followed them to carry out a full investigation. Three weeks later they announced that Carlos Reyes, also known as King Carl of Caspinistan, had committed suicide. The officers who had first arrived on the scene shook their heads and muttered that they wounds they had observed could not have been self-inflicted. They further added, to anyone who would listen, that the corpse had not looked to them much like the Mexican drug runner they had been watching since the day he arrived in town. Surprisingly few people would listen to the officers’ account.

The mansion became once again a Days Inn. The manager stayed on, but at his former salary. The factory was also returned to its former owners, who hired back many of their old workers. Randy Jackson quit his job at the factory and bought back his old farm. He grew corn and soybeans, rotating his crops, and he also raised about twenty head of beef cattle each year. Unlike his neighbors, he did not seem to care much about costs or about the prices paid to him for his harvests. Benjamin finished college and applied to graduate school, again never asking questions about financial aid. Along the way he missed almost a year of classes due to a battle with cancer, but he received the finest care at the University Hospital and is now in full remission.