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Democracy, Capitalism, Socialism, Communism, Fascism: A Definition of Terms


A user’s comment about Mussolini’s preferred system of government and its origin in Giovanni Gentile’s political theories has led me to consider a definition of terms and to offer any interested party an opportunity to argue about these definitions.  The terms with which I concern myself are listed in the title: capitalism, socialism, communism, fascism, democracy.  These are words loaded with heavy connotations.  These words are often used entirely contrary to their meanings as ordinarily understood.


First, capitalism.  This is not a system of government, but ” an economic system (and an ideology) based on private ownership of the means of production and their operation for profit.  Characteristics central to capitalism include private property, capital accumulation, wage labor, “voluntary” exchange, a price system, and competitive markets.  In a capitalist “market economy” decision-making and investment are determined by the owners of the factors of production in financial and capital markets, whereas prices and the distribution of goods are mainly determined by competition in the market.” (Wikipedia; fourteen of the terms used in this definition are discussed in separate Wikipedia articles but the links have been removed to reduce confusion.  Emphasis has been added for clarity.)

Second, socialism.  This is “a range of economic and social systems characterised by social ownership and democratic control of the means of production, as well as the political theories and movements associated with them. Social ownership may refer to forms of public, collective, or cooperative ownership, or to citizen ownership of equity.  There are many varieties of socialism and there is no single definition encapsulating all of them, though social ownership is the common element shared by its various forms.”  (Wikipedia again.)

Third, communism.   This is “the philosophical, social, political and economic ideology and movement whose ultimate goal is the establishment of the communist society, which is a socioeconomic order structured upon the common ownership of the means of production and the absence of social classes, money, and the state.

Communism includes a variety of schools of thought, which broadly include Marxism, anarchism (anarchist communism) and the political ideologies grouped around both. All of these share the analysis that the current order of society stems from its economic system, capitalism; that in this system there are two major social classes: the working class—who must work to survive and who make up the majority within society—and the capitalist class—a minority who derives profit from employing the working class, through private ownership of the means of production—and that conflict between these two classes will trigger a revolution. The revolution will in turn establish social ownership of the means of production, which according to this analysis is the primary element in the transformation of society towards communism.”  (Wikipedia.)

Finally, fascism.   This is “a form of radical authoritarian nationalism characterized by dictatorial power, forcible suppression of opposition and control of industry and commerce.”  (Wikipedia.)  This is the shortest definition, possibly because fascism is the least popular or justifiable form of government.

Oh, yes.  Democracy.  This is “a system of government in which the citizens exercise power directly or elect representatives from among themselves to form a governing body, such as a parliament. Democracy is sometimes referred to as “rule of the majority”. Democracy is a system of processing conflicts in which outcomes depend on what participants do, but no single force controls what occurs and its outcomes.The uncertainty of outcomes is inherent in democracy, which makes all forces struggle repeatedly for the realization of their interests, being the devolution of power from a group of people to a set of rules.”  (Wikipedia; oddly, this definition only includes one link, to an article about parliaments.)

Discussion: Mischaracterizations

So far, this is just copied from Wikipedia.  Where it gets controversial is when we go to defining the actual forms of government in existence around the world.  Many countries call themselves “democratic” or “democratic socialist” but obviously are not.  There is instead usually a degree of fascism, characterized by various levels of authoritarian or autocratic control, use of secret police techniques to suppress opposition, and autocratic direction of industry and commercial policy.

In fact, the United States of America is an example of this mischaracterization of real societal structures.  The leaders call themselves “democratically elected” yet try to suppress democratic opposition and demonstrations with retaliatory measures announced on social media; they even give directions to industries to build their factories within the borders of the country.  The minions try to suppress democratic rights and limit the ability of working class people to vote by reducing voting hours and opportunities and enhancing prerequisites for voting, using gerrymandering to distort election results in their favor.  The leader consorts with and endorses the leaders of other countries that use similar methods or are even more extreme in their tactics.  Another example is the Philippines with a “democratic” government and elections but the current leader is a demagogue with autocratic tendencies who has initiated a brutal crackdown on all users of “illegal drugs” of any sort; he openly advocates the murder of anyone even suspected of involvement in drugs.  The leader of our country has praised the leader of the Philippines and other autocrats while denigrating countries with more democratic governments.

Problems with Democracy

The problem with democracy as practiced in these countries is that the people, lacking education, are susceptible to the blandishments of demagogues who offer simple solutions to complex problems.  Once in power, these leaders institute fascist systems that fail to improve the lot of those who have elected them, in fact actively destroying the stability of the system they  were elected to support.

Another recent publication referred to the American tendency to fetishize self-determination as a contributing factor in our gullibility in the face of propaganda and fake news.

The solution to the problems of government that we face is universal education that prepares the youth for critical analysis of claims by political demagogues.  The current federal government in the US is actively seeking to destroy the objective educational systems that have been developed since universal free education was decreed to be a responsibility of local government.  The secretary of the federal department of education has no experience of school-based educational systems and is devoted to a “home school” fantasy that would place the responsibility for education in the hands of parents.  She ignores the fact that most parents of working-class children have to work all day and have no time to educate their children, much less ability or experience.

The Role of Capitalism

Capitalism is a natural method of producing and distributing goods.  It is the most efficient system for valuing and providing goods that are in demand.  Capitalism is not efficient at serving the needs of society as a whole when emergent situations distort markets or when markets are not free because of power or knowledge imbalances between the parties to transactions.  Capitalism allows ambitious and unscrupulous people to unfairly take advantage of market conditions or the ignorance of the consumer.  Capitalism also allows some people to amass fortunes while others have nothing; in fact, unregulated capitalism is the source of the vast inequalities that exist in most countries.

The sense of fairness impels some governments to institute rules that protect the weaker members of society from exploitation by stronger members.  Regulation of capitalism is necessary to ensure distribution of needed goods and services to all members of society, regardless of their ability to contribute work or capital.  Rules that prohibit deceptive advertising, inspectors to evaluate performance of good manufacturing practices, speed limits, regulation of capital markets, the requirement that banks reserve adequate capital to prevent “liquidity crises”, control of monopolies, and so on– the regulation of markets is a never-ending process attempting to maintain a balance between free markets and the ruthless exploitation of human capital.

The Difference Between Capitalism and Communism and their relation to Socialism

Communism is an ideology that fantasizes a future in which money and governments can be dispensed with.  The attainment of this future always involves revolutionary action that destroys both the bad aspects of present society and the good aspects.  People who endorse communism always want to destroy the current system and replace it with something “better” in a constant effort to reach towards that ideal future system.  The problem with communism is that it fails to allow the good parts of the present to persist– destruction of the bad parts always comes with collateral damage.  The “pushback” against destruction always forces the revolutionary elements to resort to force and coercion to obtain the re-distribution of inequalities.

Capitalism is a natural tendency for selfish people, which includes most of us.  We naturally wish to own things and exercise control over them, to the extent that we are able.  The trouble with capitalism is the development of vast inequalities of property and the consequent suffering of those who have little or nothing.  Socialism is, colloquially,  a way of distributing things in a fairer manner with the use of social structures such as health insurance, unemployment insurance, old age pensions, welfare, and so on.  This soft socialism has the advantage that it can be administered democratically, through parliamentary structures; the more democratic a society is ( that is, the more the voting franchise is extended to all people ), the greater the demand for this sort of socialism.

“True” socialism, involving the common ownership of the means of production, is unwieldy because historically ownership is concentrated in the hands of a few individuals and corporations who wish to maintain their position and the status quo.  Even an extreme democracy in which all people have voting rights (and do vote in their own enlightened interests) will face resistance from entrenched ownership interests when they are threatened.  The isolation of government power from the power of ownership interests who use money to abuse political contests will be necessary to prevent reversion to primitive capitalism.

Large Countries Have Mixed Economic and Political Systems

The systems of the two largest countries in the world, India and China, can be taken as examples.  India nominally has a democratic government, but there are numerous socialist aspects.  China nominally has a communist government, but it falls short in numerous respects (particularly in the provision of health care) and had “liberalized” its economy since 1982, allowing numerous capitalist features and sponsoring many wealthy and powerful individuals.  China also has many features of fascist governments, such as a vast secret police and censorship apparatus and overt nationalism.  Overall, Chinese people have seen tremendous improvement in their material welfare, but they still suffer under an authoritarian/fascist apparatus in their government.


Capitalism is probably a precursor to all social systems.  Democracy in small groups is an early improvement on the strong man system of government.  Capitalism and democracy in small groups is compatible.  Capitalism, democracy, and socialism are also compatible; socialist systems that are democratically imposed are stable and minimally coercive (imposing market regulations, a graduated income tax, and an estate tax are not in the same category as forcing people to relocate in order to correct population imbalances.)   Democracy is not compatible with fascism or communism because of the large element of coercion required to shape society to idealistic or narcissistic ends.

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