Is Socialism the Solution?

The socialist society, according to Marx, is “in every respect, economically, morally and intellectually, still stamped with the birthmarks of the old society from whose womb it emerges”. Just this line from the father of socialism, Karl Marx, makes the socialist idea counterintuitive for South Asia. Even in its lower, imperfect form, let alone its ideal one, socialism must emerge from a capitalist society. For socialism to be conceivable, capitalism first has to exhaust its life.

This, for Pakistan and South Asia at large, is really far-fetched. We haven’t even mastered capitalism yet. One can argue that we are still living in feudalism, with our urban population deluded into believing that we are somehow living in capitalism and an even smaller chunk convinced we have already reached the stage where we can move on to socialism. And perhaps the fact that you are reading this article, catering to the demand of the very few who are privileged enough to think about anything other than basic survival in economies where 88% of Pakistanis, 53% of Sri Lankans and 71.5% of Bangladeshis earn under $8.30 a day, is enough to justify that we are nowhere near capitalism. Capitalism, at the very least, gives the poor hope of escaping their current state.

And it isn’t just the economics working against socialism; the biggest enemy of socialism is its own promoters. When your entire argument is “capitalism is bad,” you might win a few regulations against the obvious excesses, but nothing for socialism itself. The whole pitch amounts to: Switch to socialism. We don’t quite know how it will be, but it will be better. No revolution, regardless of its scale, can afford, let alone demand, uncertain outcomes. And what we are talking about is a mega revolution, turning the whole economic system on its head. The common man does not buy into hypothetical promises of equal pay and representation when the other end, despite its flaws, is enough to keep him running while also dangling visible opportunities to break through. In South Asian countries, the currency gap is so wide that simply earning in euros, pounds or dollars and spending in local currency is just as big an opportunity. Capitalism presents that alone, and it is enough to blunt any appetite to revolt against it.

So, is socialism the magic wand that South Asia was looking for? Is this the solution that will return prosperity to the region? Is socialism the Elixir of Life that will grant the South Asian economies the long-standing youth that they wished for? Is this the missing piece that will finally pull the whole population out of poverty? Perhaps not, or to phrase it correctly, absolutely not.

The problem does not lie in capitalism, socialism or, for that matter, any economic system. South Asia has a far deeper problem of corruption and incompetence that requires more than just a change in the economic system. Yes, incompetence too. I will come back to that. The bottleneck here lies not in policy but in implementation.

I recently read, and entirely agreed, that one flaw of liberal democracy is that it assumes institutions to be independent of the people working in them. They are not. Institutions under any system are neither independent of each other nor of the people working in them. No Parliament can be neutral with corrupt MPs, and similarly, no Parliament can be corrupt without a corrupt judiciary, military and media (the pillars of liberal democracy). So, be it capitalism or socialism, the implementation part is where the problem lies. And to push on my earlier point on incompetence, our implementers range from members of parliament, who are inherently incompetent from the very way they are elected, to bureaucrats learning incompetence on the job. We haven’t even learned to vote based on performance, past or promised.

This brings me to China, whose success is often held up as an example. China is different in its entirety from these countries. The one-party system and the hold of the Communist Party of China are what make the model successful and implementable. The CPC does not have to make any populist moves to retain its government. The CPC also owns all the land and capital outlets (i.e. banks). So, anytime the CPC wants to build a road or an economic zone, it can just requisition the land, with no independent judiciary to challenge the decision in light of the constitution. Above all this, there is state control over people; you cannot live in China and oppose the CPC. Until South Asia is ready to let go of these basic human rights, China cannot be a role model, for socialism or anything else.

Shafay AbdullahThe writer is an ACCA Affiliate and an associate consultant at A.F. Ferguson & Co.

The writer is an ACCA Affiliate and an associate consultant at A.F. Ferguson & Co.

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