what is socialism 
socialism is a populist economic and political system based on collective common or public ownership of the means of production those means of production include the machinery tools and factories used to produce goods that aim to directly satisfy human needs in contrast to capitalism whereby business owners control the means of production and pay wages to workers to use those means socialism envisions shared ownership and control among the laboring class in a purely socialist system all production and distribution decisions are made by the collective directed by a central planner or government body worker cooperatives however are also a form of socialized production socialist systems tend to have robust welfare systems and social safety nets so that individuals rely on the state for everything from food to healthcare the government determines the output and pricing levels of these goods and services socialists contend that shared ownership of resources and central planning provide a more equal distribution of goods and services and a more equitable society nono flores investopediaunderstanding socialismcommon ownership under socialism may take shape through technocratic oligarchic totalitarian democratic or even voluntary rule a prominent historical example of a socialist country albeit one run by communists is the former union of soviet socialist republics ussr also known as the soviet union due to its practical challenges and poor track record socialism is sometimes referred to as a utopian or post scarcity system although modern adherents believe it could work if only properly implemented they argue that socialism creates equality and provides security a worker s value comes from the amount of time they work not in the value of what they produce while capitalism exploits workers for the benefit of the wealthy socialist ideals include as an old socialist slogan describes it from each according to ability to each according to need 1while socialism calls for collective or shared ownership of the means of production it does not imply that there is no private ownership of personal property thus corporations and factories would be shared among the members of society but individuals and households would still own their own personal effects history of socialismhilary allison investopediasocialism as a system of shared resources and collective production dates back to the earliest human civilizations tribal or clan based societies would often work for the common good and work together to produce enough food and supplies for the entire population collective agriculture persisted for thousands of years this was replaced in many places by a sort of feudal system whereby landed nobility lords ruled over peasants serfs who worked the land without owning it socialism s intellectual roots date back to plato s republic in which he described a collective society centuries later thomas more s utopia echoed platonic ideals in its depiction of an imaginary island where people live and work communally socialism was a direct response to the industrial revolution which brought enormous economic and social change to great britain and the rest of the world as industrialists grew wealthy on the labor of workers who increasingly lived in poverty socialism emerged as an alternative to capitalism one that could improve life for the working class 2modern socialism developed in opposition to the excesses and abuses of liberal individualism and capitalism under early capitalist economies during the late 18th and 19th centuries western european countries experienced industrial production and compound economic growth at a rapid pace some individuals and families rose to riches quickly while others sank into poverty capitalism created income inequality and spurred other social concerns the most famous early socialist thinkers were robert owen and henri de saint simon and later karl marx and then vladimir lenin it was primarily lenin who expounded on the ideas of earlier socialists and helped bring socialist planning to the national level after the 1917 bolshevik revolution in russia following the failure of socialist central planning in the former soviet union and maoist china during the 20th century many modern socialists adjusted to a high regulatory and redistributive system sometimes referred to as market socialism or democratic socialism critics of socialism contend that it is based on faulty principles and ignores human nature socialism vs capitalismcapitalist economies which today are often synonymous with the free market or market economies and socialist economies differ by their logical underpinnings of the structures of ownership and production socialists and free market economists tend to agree on fundamental economics the supply and demand framework for instance while disagreeing about its proper adaptation and how commodities should be produced functionally socialism and free market capitalism are often divided on two core issues property rights and control of production in a capitalist economy private individuals and enterprises own the means of production and have the right to profit from them private property rights are taken very seriously and apply to nearly everything in a purely socialist economy the collective owns and controls the means of production personal property is allowed but in the form of consumer goods essential services like healthcare education and public transportation are administered for free by the government and funded through taxation in a socialist economy public officials known as central planners may control the behavior of producers consumers savers borrowers and investors by taking over and regulating trade the flow of capital and other resources in a free market economy trade is conducted on a voluntary or nonregulated basis however there are many other ways to coordinate production in a collectivist fashion without such dominating control and loss of personal autonomy market economies rely on the separate actions of self determining individuals to determine production distribution and consumption decisions about what when and how to produce are made privately and coordinated through a spontaneously developed price system and prices are determined by the laws of supply and demand proponents say that freely floating market prices direct resources toward their most efficient ends profits are encouraged and drive future production socialist economies rely on either the government or worker cooperatives to drive production and distribution consumption is regulated but it is still partially left up to individuals the state determines how main resources are used and taxes wealth for redistributive efforts socialist economic thinkers consider many private economic activities to be irrational such as arbitrage or leverage because they do not create immediate consumption or use still marx saw that capitalism was rife with contradictions class conflict and self destructive competition as a result he saw socialism as the logical next phase of human political economy several philosophical questions also lie at the heart of the debate between socialism and capitalism what is the role of government what constitutes a human right what roles should equality and justice play in society socialism vs communismcommunism and socialism are umbrella terms referring to two left wing schools of economic thought both oppose capitalism but socialism predates the communist manifesto an 1848 pamphlet by marx and friedrich engels by a few decades they are both economic philosophies that advocate for public ownership particularly over the means of production and the distribution and exchange of goods in a society and both philosophies run contrary to free market capitalism which they contend exploits workers and creates a widening gap between rich and poor there are differences between socialism and communism however in fact communism can be thought of as a strict and all encompassing version of socialism under communism all property is communally owned private property doesn t exist under socialism individuals can still own private property marx predicted that a violent worker uprising against the middle and upper classes would bring about the communist state whereas socialists tend to seek change and reform without overthrowing the prevailing social and political structure and according to communist theory workers should be given what they need while under socialist theory they are to be compensated for their level of contribution to the economy 3contention between socialists and capitaliststhere are many points of contention between socialists and capitalists socialists consider capitalism and the free market to be unfair and possibly unsustainable most socialists contend that market capitalism is incapable of providing enough subsistence to the lower classes they contend that greedy owners suppress wages and seek to retain profits for themselves proponents of market capitalism counter that it is impossible for socialist economies to allocate scarce resources efficiently without real market prices they claim that the resultant shortages surpluses and political corruption will lead to more poverty not less overall they say socialism is impractical and inefficient suffering in particular from two major challenges the first challenge for socialism widely called the incentive problem is that no one wants to be a sanitation worker or to wash skyscraper windows that is socialist planners cannot incentivize laborers to accept dangerous or uncomfortable jobs without violating the equality of outcomes far more serious is the calculation problem a concept originating from economist ludwig von mises 1920 article economic calculation in the socialist commonwealth socialists wrote mises are unable to perform any real economic calculation without a pricing mechanism without accurate factor costs no true accounting may take place without futures markets capital can never reorganize efficiently over time 4can a country be both socialist and capitalist while socialism and capitalism seem diametrically opposed most capitalist economies today have some socialist aspects elements of a market economy and a socialist economy can be combined into a mixed economy in fact most modern countries operate with a mixed economic system government and private individuals both influence production and distribution economist and social theorist hans hermann hoppe wrote that there are only two archetypes in economic affairs socialism and capitalism and that every real system is a combination of these archetypes but because of the archetypes differences there is an inherent challenge in the philosophy of a mixed economy and it becomes a never ending balancing act between predictable obedience to the state and the unpredictable consequences of individual behavior 5the great recession and the covid 19 pandemic have increased interest in the government creating more opportunities and increasing the social safety net for all americans these are hallmarks of socialist policy and not everyone agrees with such ideas 