Government Under Socialism

Government Under Socialism, Socialist Economic System

Socialism assumes the existence of organized government, and the so­cialist declares forcefully that he believes in democracy. True political democracy, it is claimed, must begin with economic democracy—the social ownership of capital goods. Socialists place major emphasis on the legislative branch of government because in their view true democracy must include not only democratic enactment of laws but also direct democratic control over how they are interpreted and carried out.

The reliance on democratic institutions can present interesting prob­lems for a socialist government. Often such governments are elected with members of labor unions providing the most important bloc of political support. Once major industries are socialized, however, the government faces the necessity of reaching labor settlements with the very unions that helped bring the government to power. The dilemma of trying to deny wage increases to workers for economic reasons while asking the same workers what benefits they want their democratic socialist government to provide has comic overtones.
The problem of bureaucracy often arises in discussions of govern­ment under socialism. Bureaucracy is inevitable in any organization, if by that term one means the impersonal hierarchy of command and the stand­ardized set of rules and procedures that arise whenever the scale of an in­stitutional arrangement, private or public, exceeds the administrative ca­pacity of a single head. The term bureaucracy means little so far as the technical structure of government goes; its antisocial potentials become significant only when powerful public agencies fail to reflect enlightened popular will. The charge of bureaucracy more often is meant to convey an image of low productivity, low morale, and fanatical concern for petty regulations on the part of employees of nonprofit organizations. We will return to the issue of attitudes under socialism in the next chapter; it is sufficient at this point to recognize that the question of incentives provided for high-quality work within government agencies is of crucial importance in a society that plans to make such agencies the center of economic de­cision making.

The socialization of industry would, of course, automatically elimi­nate most of the pressure on each individual concern to search for and adopt new technical improvements. The social-planning agency would thus be forced to work out plans for the installation of new processes as an integral part of an industrial plan for the entire economy. The socialist contends that the profit motive in private "oligopolistic" industries fre-qently leads to the suppression of innovations to protect current profits or capital values; he therefore believes that socialism would be more open to new technology. It is important to note that the research laboratories of large American corporations appear to be a continuing source of eco­nomic and scientific innovation despite the prediction of one astute ob­server that the "routinization" of corporate research in formal organizations would eventually dry up the flow of new discoveries and thus cause the downfall of capitalism. The socialist is confident that the mixture of intellectual curiosity and desire for recognition that spurs the scientist could ensure that the stimulation to do research and to invent would not be lack­ing, despite the absence of the private-profit motive in a socialist economy. In presenting this list of potential problems to be faced in a socialist economy, we have implicitly suggested that acceptable solutions might not be available. These potential stumbling blocks will be considered in the following chapter in the context of an overall critique of a socialist system.