Socialism is often thought of in connection with the doctrine of anarchy. Anarchism and socialism are alike in that both object to one man having authority over another. Anarchism agrees with socialism that capitalism is bad because it gives the employer power over the laborer. But at this point the two theories begin sharply to diverge. Socialism desires to abolish private property and to concentrate all authority in the hands of the state. The anarchist maintains that this is simply a transference of authority, and declares that authority in any form is an evil. Thus where socialism seeks to enlarge the powers of the state, anarchism objects to the existence of any governmental authority whatsoever.
In addition to communism and anarchism, there are a number of interesting theories that are more or less closely associated with the socialist movement. These will not be discussed here, for two reasons: first, an adequate treatment of them would permit the problem of industrial reform to take up a disproportionate share of our time; second, many of these theories, while interesting, are relatively unimportant, from the standpoint of American democracy at least. We may, therefore, confine ourselves to socialism proper, as defined in Section 122.
124. KARL MARX AND HIS INFLUENCE.—The germ of socialism can be traced back as far as Plato, but the modern movement takes its main impetus from the teachings of Karl Marx. Karl Marx was a German Jew, who lived between 1818 and 1883. Marx early became known for his radical views on political and economic subjects. In 1848, he published, in collaboration with Frederick Engels, the well-known Communist Manifesto. The Manifesto, which has been called the "birth-cry of modern socialism," gives in concise form the essence of the socialist doctrine. In 1864 Marx helped organize the "International," a federation of radical thinkers, with affiliations in the different countries of Europe. In 1867 he published the first volume of his famous work, Capital, which elaborated the views set forth in the Manifesto, and which has since been adopted as the "Bible of Socialism." Due to the great influence which Marx has exerted upon socialist doctrine, he may justly be called the founder and inspiration of modern socialism.
125. THE SOCIALIST INDICTMENT.—The claims of socialism, as formulated by Marx and elaborated by his followers, constitute a serious indictment of present-day society. Socialists point out, for example, that the capitalistic system has numerous faults. They call attention to the fact that capitalism involves enormous wastes in materials and men; they show that luxurious and injurious goods are produced; and they maintain that in the past natural resources have often been monopolized by a few. They believe the system of private property to be unjust, and declare that free competition involves needless duplication of effort. At the present time, it is contended, all the good things of life go to a few, while the masses remain in poverty and misery. Socialists declare that the fruits of capitalism are unemployment, industrial accidents, crime, vice, poverty, disease, and premature death. These charges are serious, and Chapter XVI will be devoted to their critical examination. In this chapter we are concerned chiefly with an exposition of the socialist doctrine.
126. ECONOMIC INTERPRETATION OF HISTORY.—Formerly a great principle of socialism was the claim that all history has been determined by economic forces. According to this view, our whole social and political life, including our basic ideas concerning religion, art, science, and government, are only the reflected result of economic forces. History, Marx contended, is the record of how one class has gained wealth and power at the expense of another class. The present state of society, he asserted, is the result of the exploitation of the masses by a few.
With this principle we need not further concern ourselves. It is an academic appendage to the socialist doctrine, and at the present time is not stressed by socialists. The majority of socialists now concede that while economic forces have been important in history, social, religious, and political forces are also important. In view of this admission, the chief importance of the doctrine of the economic interpretation of history is its theoretical connection with the two great cornerstones of socialism: the theory of surplus value, and the theory of class struggle.
127. THEORY OF SURPLUS VALUE.—Marx claimed that practically all wealth has been created by the laborers alone, and that all persons other than laborers are parasites. To those who have carefully studied Chapter VIII the error of this claim must appear self-evident, nevertheless, this concept of value is the basis of all socialist attacks upon government and industry. Marx developed this theory as follows:
The value of an article is determined solely by the amount of labor expended upon its production. But although the laborer creates all wealth, the capitalist is enabled, by virtue of his monopolistic control over the instruments of production, to prevent this wealth from going entirely to the laborer. [Footnote: By "capitalists" socialism means not only individuals with money to loan, but "employers" in general, whether middlemen, entrepreneurs, or true capitalists. ] Socialism declares that the capitalist holds the laborer in virtual slavery, the laborer receiving only enough of the wealth created by him to enable him to keep alive, while the surplus of this wealth goes to the capitalist. The capitalist is thus a parasite who performs no useful task, but robs the laborers of the fruits of their industry. Marx did not regard profits as reward for business enterprise, but called them "plunder." Capitalism, according to this view, is a system of theft, involving "misery, oppression, slavery, degradation, and exploitation."
128. CLASS STRUGGLE.—Marx declared that the capitalistic system was doomed to destruction. He maintained that as time went on, wealth would tend to concentrate more and more in the hands of the capitalist or employing class. Trusts and monopolies would become more common, and gradually capitalism would become so unwieldy and so unworkable a mechanism that it would finally fall to pieces of its own weight. Crises, panics, and trade depressions were supposed to be indications of this inevitable disaster.
The tendency for wealth to concentrate in the hands of a few was to be accompanied by the growing poverty of the masses. Marx believed that the middle classes would eventually disappear, leaving only the wealthy employers and the miserable laborers. The individuals comprising these two classes would steadily draw apart into two great armies which were destined to battle to the death. Socialism denies that employers and laborers have anything in common, and insists that between these two groups a struggle must go on until the employing class is abolished.