Seattle now has a Socialist on our City Council!  Kshama Sawant. is not the first socialist to win a city election – that was Anna Louise Strong, elected to the School Board in 1916 – but she is the first in 97 years, and the first ever on the City Council.  She will take office in January.

And my friend Annie asked, “What is socialism, anyway?”  The far right makes it sound like “The government owns everything and the government decides who gets what,”  and that equates to no more freedom for anyone, the government controls your life, and we’re all gonna die.

#1  Socialism is an economic system that can operate under any political system, including democracy.  On the evidence of European democracies and the early United States, socialism operates best under a democracy.

There is a difference between the communist principle of “The people own the means of production” with the government acting for “the people,” and the socialist principle of “the means of production should be owned by the community and everyone share in the profit.”

Communism:  The government owns the shoe factory, sets the wages, decides what shows will be made, and decides how to distribute the shoes.   Wealth, resources, and all goods and services are, in theory, distributed equally; in practice, everything is distributed by a central group of decision-makers, and tends to favor them and their friends.

Socialism: Everybody who works in the factory shares ownership of the factory, collaborates in decisions, and shares in the profit.  Since decisions are made locally, by people immediately affected, and who all know each other face-to-face, they tend to be both more democratic and more practical.

Capitalism: Ms. X started the show factory; it is now owned by shareholders, managed by employees they hire, and the work is done by employees that the managers hire.  Profits go to the shareholders; employees get wages. Managers are rewarded (sometimes by a share of the profits) for maximizing shareholder profits, both by increasing production and by cutting costs, which includes cutting wage costs and/or number of workers.  When shareholders and managers make decisions that affect the people on the production line, without consulting the people affected, the results can be disastrous.

Can you tell which I favor?

The people who are affected by a decision should always have a controlling voice in making the decision.  The people who do the work, the people who produce goods and services, should always have a share in the profits.

This is not centralized control.  A giant corporation owning factories all over the world is centralized control.  Worker-owned business is decentralized, local, on-the-spot control .

A free market remains the most effective way of distributing goofs and services. Not only is socialism compatible with a free market, it is far more compatible with a free market than corporate capitalism is.  Adam Smith, more often idolized than read, identified essential elements for a free market system that creates prosperity for all, including:

• Buyers and sellers must be too small to influence the market price.
• Sellers must bear the full cost of the products they sell and pass them on in the sale price.
• Savings must be invested in the creation of productive capital.

An economy dominated by giant corporations is a controlled economy, not a free market.  When a community has to support the families of people working more than forty hours a week and not able to buy food,  pay rent, and get medical care all at the same time, the public is subsidizing private business: that is not a free market.  When a company pays a pittance (or nothing at all) for the use of natural resources (ores, land, water and air)  then the public is subsidizing private business: that is not a free market.   When the community suffers dirty air, polluted water or pays for cleanup, the public is subsidizing private business: that is not a free market.

Workers who have to go home and answer to neighbors and family are less likely to externalize costs.  Workers who share in company profits are motivated to increase production and improve quality; they are not motivated to cut wages.  The profits of a worker-owned company either circulate in the economy through private purchases, or get reinvested in the company -they don’t pile up in a share-owner’s overseas bank account.

I don’t want corporations controlling my life.  I don’t want communist committees controlling my life, either.  I want a free market!  I want socialism!