Russell Haggar

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Essay: Why and to what extent have socialists supported the common ownership of wealth?

 

Changes in the new Specifications and in particular the emphasis placed upon particular key thinkers within each ideology mean that the documents on this page do not currently adequately reflect the requirements of the new Specifications. Consequently my advice to students following the New Specification  would be to rely upon advice from your teachers and recently published A Level texts on Political ideas rather than the documents posted here. I hope eventually to rewrite these documents to reflect the new Specifications but this is going to take a long time. 

 

In the analysis of socialism it is important to distinguish especially between revolutionary Marxist socialism and evolutionary socialism which may be seen as encompassing two similar but not identical variants: democratic socialism and social democracy. These different types of socialists offer a variety of reasons for their varying support for the common ownership of wealth.

Marxists oppose the capitalist system and argue that since it cannot be reformed effectively it must be abolished almost certainly via revolution although possibly in some circumstances via parliamentary means. The abolition of capitalism implies both the abolition of private ownership of the means of production which are now to be owned and controlled by the state and the abolition of social classes which in Marxist theory can no longer exist if private property has been abolished. For Marxists the means of production should be under common ownership for several reasons:

• common ownership permits the state-wide planning of production which in principle may be more rational and hence result in greater economic efficiency than leaving the ownership and organisation of production in private hands which will result in wasteful competition;
• common ownership can result in the planning of production to meet real needs rather than the artificially stimulated demands  for luxuries as in the capitalist system; with common ownership and state planning more affordable houses and kidney machines and fewer luxury penthouses and fast cars will be produced;
• under capitalism the owners of the means of production make large profits which Marxists consider to be excessive so that private property is a major cause of economic inequality of outcome which is seen as unjust in several respects. This economic inequality undermines equality of opportunity and inhibits the development of individual talent whereby the common ownership of the means of production would result in greater equality, greater equality of opportunity an fuller self-development;
• Marxists argue that when individuals work in private companies producing products [e.g. cigarettes and fast food] whose usefulness is questionable under the control of employers who have little interest in the work force other than as a source of profit the workers’ sense of self-worth is diminished and they feel alienated from their work. With common ownership and production for need rather than for profit it is argued that alienation will decline and worker self-worth will increase. Workers will increasingly rediscover their natural cooperativeness and community spirit ; they will be more interested in making suggestions to increase production and economic growth and living standards will increase;
• in modern times neo-Marxists have had especial concerns about the activities of multi-national corporations especially in Third World societies where they may make excessive profits via the exploitation of their workers. Here, according to neo-Marxists is an especially strong case for common ownership

Evolutionary socialists vary in their support for common ownership. Radical democratic socialists would, to a considerable extent, accept Marxist arguments in favour of common ownership whereas social democrats of the Croslandite revisionist type are supporters of the mixed economy while supporters of “New Labour” or the “Third Way” see an even smaller role for common ownership, being prepared to accept the privatisations of several nationalised industries introduced by Conservative governments 1979-1997. Radical democratic socialists would tend to accept to a considerable degree the arguments in favour of common ownership advanced by Marxists although they might also see some benefits in the continued existence of a private sector, an argument certainly supported by Croslandites and Blairites.

In his study “The Future of Socialism” [1956] Tony Crosland argued that Marx’ analysis of C19th capitalism was of little relevance for the understanding of C20th capitalism and that Marxist arguments in favour of total common ownership were misguided. Crosland argued that the industries had nationalised in 1945-51 were over-bureaucratic, inefficient and remote from consumers and that working conditions had not improved as  a result of nationalisation, all of which meant that further nationalisation was undesirable.

Instead it was necessary to use the dynamism of the private sector, combined with some state regulation of the private sector, redistributive taxation and social security policy and increased government spending on other aspects of the welfare state such as Education, Health and Housing to improve overall living standards and to generate greater equality and equality of opportunity while maintaining some inequality in order to maintain economic incentives.

Socialism, in Crosland’s view, should mean greater equality and increased common ownership could actually contribute little to this. Unfortunately Crosland’s version of socialism depended for its success on the achievement of a faster rate of economic growth to finance improvements in the welfare state and to promote greater economic equality. Broadly speaking it was the poor performance of the UK economy which undermined the social democratic strategies of the Wilson and Callaghan Labour governments of the 1960s and 1970s.

This led the Left of the Labour Party to demand more radical economic policies involving more widespread common ownership and greater regulation of the private sector of the economy although it was clear that even the Labour Left still supported the continuation of a substantial private sector of the economy. In any case when Labour fought the General Election on a radical manifesto involving among other things, increased common ownership, unilateral nuclear disarmament and withdrawal from the then EEC [now the EU], they were soundly defeated all of which has resulted in a shift toward moderation in the Labour Party, gradually at first but then more rapidly under the leadership of Tony Blair.

For Mr Blair and his supporters, and probably also for Mr Brown, common ownership plays a limited role in their “neo-revisionist” redefinition of socialism. In this view the increasingly globalised economy means that at all costs the UK economy must be competitive if living standards are to be maintained and unemployment and poverty are to be reduced and that UK economy can be competitive only if it has a dynamic private sector.

 Furthermore the Croslandite critique of common ownership has been accepted and Labour’s commitment to public ownership has been removed from the party’s constitution so that there is no prospect that industries privatised by the Conservatives will be renationalised by New Labour and there are indeed attempts to involve the private sector more fully in the financing of the welfare state via private finance initiatives whereby private companies build hospitals, schools, prisons etc and lease them back to government. Nowadays the railways, coal, gas and electricity are no longer commonly owned but neither a large number of new state schools hospitals and prisons.

Within the broad ideology of Socialism arguments in support of common ownership have been raised most strongly by Marxists and radical democratic socialists. Social democrats have tended to accept the Croslandite critique of common ownership and since the leadership of the Labour Party has been dominated broadly by social democrats it should come as no surprise that under Labour governments, the extent of common ownership increased very little between 1951 and 1979. Given the nature of Tony Blair’s ideological position it should come as no surprise either that Conservative privatisations have not been reversed.