Socialism, Capitalism, 5 Points of Ignorance, and Progressive Organizational Movements

by cv harquail on April 14, 2009

I just got done commenting on the blog of my colleague and blogging buddy Michael Roberto, a strategy professor at Bryant University. Michael blogged today about his concern that Americans (and by extension, students in the Business Schools where many of us teach) have lost faith in Capitalism.

Michael’s answer to this problem, in so many words, is that

"As educators, we should never flinch from teaching that capitalism is far superior to socialism, while acknowledging that people of different political affiliations may have different views on the form of capitalism that should be employed."

Should I have been surprised to find myself writing 300+ words in reply?

Probably not. I know my views on Capitalism (and by extension, democratic socialism) are not as common in the business schools where I have learned and taught as they are in the political science and philosophy departments where my views were first formed.

Moreover, I recognize that I was probably the only Darden faculty member ever to receive anonymous feedback from a student that "People who don’t believe in Capitalism shouldn’t be allowed to teach in a business school."

Apparently being married to a Harvard MBA, getting a 4.0 in my MBA Finance course, having a PhD from a Business School, owning stocks and amassing property wasn’t enough to establish my street cred as a believer in Capitalism. Which is, in the end, fine with me. Why? Because —

It’s less important to be a believer than it is to be someone who understands.

And, it is less important to accept what Capitalism as practice has to offer us, than it is to consider how to adjust, reform, and apply Capitalism to make the world a better place.

I’m pasting most of Michael’s post, as well as my reply, below, for your enjoyment. Please do check out Michael’s blog directly… not because I agree with him most of the time (I generally do) but also because he has useful insights on a wide range of business & strategy issues.

I’d love your thoughts on these issues… if you share them in the Comments, below, I’ll incorporate them in my upcoming discussions of Progressive Organizational Movements…

Capitalism vs. Socialism

Rasmussen released a shocking poll last week about Americans’ views regarding capitalism and socialism. Here’s an excerpt from their report:

Only 53% of American adults believe capitalism is better than socialism.

The latest Rasmussen Reports national telephone survey found that 20% disagree and say socialism is better. Twenty-seven percent (27%) are not sure which is better.

Adults under 30 are essentially evenly divided: 37% prefer capitalism, 33% socialism, and 30% are undecided.

These numbers clearly reflect some disenchantment associated with the poor economy. Still, these data startle and worry me. Do young people truly understand what socialism means? Do they recognize that, throughout our history, well-meaning Americans of all political stripes have worked very hard to build and defend our system of democratic capitalism. This economic and political system has brought freedom and posterity to many parts of the world. Socialism has brought nothing but ruin, and with it has often come dictatorship and oppression. As an educator, I worry that perhaps we are not teaching our young people the critical lessons of history. As educators, we should never flinch from teaching that capitalism is far superior to socialism, while acknowledging that people of different political affiliations may have different views on the form of capitalism that should be employed.

Posted by Michael Roberto at 4/14/2009

Here’s my comment:

Michael,

I have a few problems with this research/poll, only one of which you mention. Very few Americans actually know
(1) what Socialism is,
(2) how Socialism works,
(3) how Socialism works in a democracy,
(4) how Socialism differs from Communism, and
(5) how Capitalism actually works.

Given these 5 points of ignorance, it’s hard to imagine that a poll of average Americans tells us anything about whether they prefer Socialism to Capitalism, or which is inherently better. It’s like those surveys about the number of Americans who don’t believe in evolution. Those surveys indicate not a failure of evolution, but a failure of *education*.

It’s hard to "know" that Capitalism is "better" than Socialism, when both are practiced in a democracy. Where democratic socialism is practiced, there is more gender equality, less social stratification, lower infant mortality, longer life spans, higher literacy, better healthcare and so on. Are these indicators of failure? I don’t think so; ymmv.

When I teach international students– you know, students from countries with democratic socialist governments & parties — I am always careful not to denigrate the values on which democratic socialism is based. The execution may be flawed (as so often is the execution of capitalism), but the values are to be respected (whether or not one disagrees).

We have in business schools right now a very serious parochialism about how capitalism should be executed (e.g., the ‘which variety’ question) and we also have a severe/obstinate resistance to analyzing how and where captialism as practiced in the US is flawed/letting us down.

I don’t think that the answer is to step up to the challenge of teaching students that captialism is far superior to socialism. I think that the better strategy is to teach students how to get in touch with their values, how to analyze systems, how to separate ideology from data, and how to make the world a better place.

Remember, I share will you a faith in the metaproject… even if we disagree on tactics.

Your thoughts? Please join in….

{ 5 comments }

jamie showkeir April 14, 2009 at 7:07 pm

Arguing that capitalism is far superior to socialism as a matter of stance seems both dangerous and difficult. Dangerous because pushing this notion blindly cuts people away from serious investigation, questioning and necessary conversations. In addition, it is a difficult argument to make if one looks at the way unfettered capitalism (of the Friedman, Chicago School variety) has wrecked havoc on countries and people around the world, including this one. Democratic socialism as pursued by Bertrand Russell (In Praise of Idleness) and others, has potential that capitalism by its very nature can’t offer. The devil of course is in the execution.

What I find myself coming back to is that fundamentally capitalism is based on a Darwinian model of competition. I, too, have earned my stripes living capitalism. However, greed breeds easily in capitalism and that has blown things up time and again. Socialism on the other hand is fundamentally about being individually accountable for the success of the whole, which can breed the slacker mentality. I don’t think we have evolved far enough as a species to see that globally we are all in this together and if we don’t begin to change our thinking, intentions, models and execution there is a distinct possibility we won’t recognize the economic system thrust upon us.

Arguing the benefits of existing “models” seems futile, why not argue about hybrid models that are designed to create local accountability for global success?

CV Harquail April 14, 2009 at 8:56 pm

Jamie, thanks so much for your comment. I wish that in business schools and elsewhere we had good conversations (authentic ones, perhaps?) about the fundamental assumptions of capitalism — like the idea that your profits are my surplus labor — or the theories that are never shown to work they way they say they will, like the “invisible hand” of the “free market”. I struggle with whether to try to have these conversations or just giving up on them and going straight to actions to modify, mollify, and mitigate the worst.
Also, I’m increasingly convinced that, in lieu of changing minds and /or having an economic revolution, we might be better served by pursuing hybrid models. … I think that all the for-purpose/for-profit hybrids take us closer to where we want to be, even if we are still inside a capitalist frame. Better to be making a difference than making folks think differently– if that is the short-term choice. And this is, of course, where authenticity comes in… I’m still working out how to say this…
Thanks so much for sharing your encouragement and your pragmatic approach. cv

Ryan Jones April 19, 2009 at 3:38 pm

CVH,
Brilliant reply. You are one of the few business thinkers out there with the humility to admit to the benefits of democratic socialism…I’m an American who has lived in Europe for the past 12 years. The entire time I have been here, the posture/stance from the US toward Europe has been quite arrogant (economically). Admittedly, I didn’t like paying higher taxes @ first. And, it has taken a while to adjust to the system over here…but now I appreciate the benefits that you articulate so well (less social stratification, lower infant mortality, longer life spans, higher literacy, better healthcare) more than ever. Arrogance is much more visible from the other side…sometimes I think we need an attitude adjustment as a nation (Bush or no Bush in office).

Also, loved your point about pushing students to get in touch with their values. We need more Profs. out there like you…

Ray C. Cooper April 23, 2010 at 11:58 am

excellent work. I live in Denmark since 2003. I lived in the States for 68 years and was fortunate to have a very good life. Since coming here, It seems that the US has become a very strange place. I was raised in Madison Wisconsin which was a very progressive city in a very progressive state and I remember Milwaukee had a socialist mayor for many years and did not plunge into communism. I remember Norman Thomas who ran for president as a socialist unsuccesfully of course but was able to. Now the most poopular (freudian slip?) 24 hour news(?) channel has completely confused many of the people and I can only feel sad at the lack of an educational system in the states.
I’m to old now to blog because I am no longer able to mentally get my thoughts together so I congratulate you for writing ‘my’ blog for me.

Cody Albert May 26, 2010 at 4:23 am

Thank you all for sharing what you know. I’m a young high school educated American just trying to get a mental grasp on society and what makes the human world go around. I come from a very capitalist family, but I have also whitnessed all of my loved ones benifit from social systems put in place in America (public education, unemployment, social security, food stamps, section8 housing, even a small government grant to get my single mother into astable career to provide for her children:-) My favorite portion of your blog is the identifacation of pure capitalisim leading to grose greed & pure socialism leading to grose lazyness. It seems that a capitalist socialist hybrid is in place already & is appropriate.

I believe that this tini piece of the world I live on, in this tini piece of history is the best in all of history. Yet every where I look Americans are scared out of their minds!!! & it’s not nesisarly because they know what’s going on them selves, but because their role models in life are freaking out.

In closing I gotta say, with all this technology around us it’s safe to say “Its a whole new world”. Communication is key & it’s at are finger tips. Hell I found this blog & wrote all this with my cell phone:-D We should not fear change in philosophy & it would be silly to believe that the perfact philosophy has already been discovered & recorded. I believe are philosophies & politics should be ever changing & evolving like everything else found in the natural world:-P

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