What Socialism Is and Is Not

Socialists are at a minimum committed to economic planning that goes counter to the operation of an economy in which private firms predominate and profits are distributed among shareholders and managers. A system of this kind necessarily perpetuates the class division between a wealthy minority and a propertyless majority. A capitalist economy, moreover, can only respond to “effective demand” backed by actual purchasing power. It operates for the benefit of paying customers only and does not recognize the existence of other people. In consequence it normally fails to satisfy basic material needs except in a roundabout way that is not to everyone’s taste. To put it crudely, the logic of the system entails the production of luxury goods for the few, rather than the provision of food, clothing, and decent housing for the many.

This is not due to the bad will or imbecility of those in control: it follows logically from the operation of the market. In an egalitar...