In Britain, Germany, France, Sweden, Australia and other developed countries, Labour and ’socialist’ parties and governments have attempted to reform capitalism in the interests of the working class rather than take the road to socialism. Instead, they have revised ‘social democracy’ to mean social progress for all within the confines of the capitalist system.
In Britain, the post-1945 welfare state helped masses of people to escape destitution and avoidable ill health. But it has proved vulnerable to frequent cuts and privatisation. Progressive taxation – based on people’s ability to pay – has provided extra funds for public services and achieved some redistribution of wealth, although the latter has since been reversed as the result of policies demanded by powerful vested interests.
Public ownership of coal, steel, the railways, electricity, gas, water, public transport, the ports, telecommunications and aerospace ensured enormous investment in basic industries, resources and services in the second half of the 20th century. But these have been programmes of capitalist nationalisation, usually carried out in order to rescue or develop vital industries that the capitalists cannot run at sufficient profit. Such state ownership on behalf of the capitalist class has invariably involved high levels of ‘compensation’ for previous private owners, subsidised prices and lucrative contracts for the private sector, little or no parliamentary accountability and no power for workers in economic decision-making.
Whether separately or together, the welfare state, progressive taxation, public ownership and economic planning do not amount to socialism. They have brought real benefits to the working class as well to the capitalists, the intermediate strata and society as a whole. They even provide a glimpse of socialism’s potential. But they have not put an end to capitalist exploitation and the vast inequalities it creates. Only socialism will do that. They also indicate the limits to collectivism and planning in what remains a capitalist economy and system of society.
In the main imperialist countries, the failure of social-democratic governments to challenge monopoly capital at home has also been reflected in their foreign and military policies, where they have continued to promote the interests of their own country’s monopoly capitalists, even to the point of military intervention.
Invariably, social democracy has ended up capitulating to monopoly capital, abandoning its most radical policies and turning on sections of its own supporters in an effort to stabilise, manage or modernise the capitalist economy.
In every case, labour and socialist parties and governments in capitalist countries have had no effective theory and programme to guide them. Their outlook is not based on a Marxist, class-based understanding of how capitalism works and where and when it is most vulnerable. Consequently, social democracy has had no strategy for progressive advance and socialist revolution. Conference policies and election manifestos have been confused with the development of a programme for far-reaching change. Government office has been mistaken for state power. Moreover, once in office, social democracy has never had any notion of involving and mobilising the working class and its allies beyond elections, of drawing them into extra-parliamentary action to defend the government and help implement progressive, anti-monopoly policies.
Overall, capitalism has had a more profound impact on social democracy than vice-versa. In the first imperialist phase of rising monopoly, imperialist war and revolution, many mass workers’ parties achieved office, but on terms set by the ruling class. Out of splits and divisions came the communist parties. In the second phase, after 1945, social-democratic governments administered, reformed and strengthened state-monopoly capitalism in return for abandoning the aim of socialism. Now, in the new third phase, some parties or leaderships have embraced ’neoliberal’ economic and social policies, although the battle of ideas within them continues, between the neoliberal, social democratic and socialist trends.
This degeneration of social democracy, alongside ruling class propaganda to identify its failures with socialism, makes it more necessary than ever to restate the case for socialism, as it applies to modern society.