BUSINESS

ENVIRONME NT

Socialism

Socialism is an economic system in which the means of production are owned by the
state and operated by the government or community and in which production is based on the welfare of the government or community and not for the profit of a few individuals .This is only a general definition and to define socialism in exact terms is very difficult as it is very difficult as it is a very elusive concept having different definitions and shades of meaning There are as many definitions of socialism as there are socialists each differing from one another mainly on the issues of 1.) private property and the extent of private property to be allowed 2.)management of public enterprises 3.)methods of distribution ; and finally 4.)modus operandi to usher in socialism by removing capitalism . another difficulty in defining socialism is the world does not describe any past or present society which can be empirically observed and so furnish unimpeachable evidence for what is or is not socialism Socialism refers to any one of various theories of economic organization advocating state, public or common worker ownership and administration of the means of production and distribution of goods, and a society characterized by equal access to resources for all individuals with a more egalitarian method of compensation.[1][2][3] Modern socialism originated in the late 18th-century intellectual and working class political movement that criticized the effects of industrialization and private ownership on society, however, socialism itself is not a political system or ideology; it is instead an economic system distinct from capitalism. Karl Marx posited that socialism would be achieved via class struggle and a proletarian revolution and become the transitional stage from capitalism to communism.[4][5] The utopian socialists, including Robert Owen, tried to found self-sustaining socialist communities within a capitalist society. Henri de Saint Simon, the first individual to coin the term socialism, was the original thinker who advocated technocracy and industrial planning. The first socialists predicted a world improved by harnessing technology and combining it with better social organization, and many contemporary socialists share this belief.[6][7] Early socialist thinkers tended to favor an authentic meritocracy combined with rational social planning, while many modern socialists have a more egalitarian approach. Socialists mainly share the belief that capitalism unfairly concentrates power and wealth among a small segment of society that controls capital, creates an unequal society, and does not provide equal opportunities for everyone in society. Therefore socialists advocate the creation of a society in which wealth and power are distributed more evenly based on the amount of work expended in production, although there is considerable disagreement among socialists over how and to what extent this could be achieved. Socialism is not a concrete philosophy of fixed doctrine and program; its branches advocate a degree of social interventionism and economic rationalization, sometimes opposing each

other. Another dividing feature of the socialist movement is the split between reformists and the revolutionaries on how a socialist economy should be established. Some socialists advocate complete nationalization of the means of production, distribution, and exchange; others advocate state control of capital within the framework of a market economy. Socialists inspired by the Soviet model of economic development have advocated the creation of centrally planned economies directed by a state that owns all the means of production. Others, including Yugoslavian, Hungarian, German and Chinese Communists in the 1970s and 1980s, instituted various forms of market socialism, combining co-operative and state ownership models with the free market exchange and free price system (but not free prices for the means of production). Social democrats propose selective nationalization of key national industries in mixed economies, with private ownership of property and of profit-making business. Social democrats also promote tax-funded welfare programs and regulation of markets. Many social democrats, particularly in European welfare states, refer to themselves as "socialists", introducing a degree of ambiguity to the understanding of what the term means. Libertarian socialism (including social anarchism and libertarian Marxism) rejects state control and ownership of the economy altogether and advocates direct collective ownership of the means of production via co-operative workers' councils and workplace democracy. The English word socialism (1839) derives from the French socialisme (1832), the mainstream introduction of which usage is attributed, in France, to Pierre Leroux.[9] and to Marie Roch Louis Reybaud; and in Britain to Robert Owen in 1827, father of the cooperative movement.[10][11] West European social critics, including Robert Owen, Charles Fourier, Pierre-Joseph Proudhon, Louis Blanc, Charles Hall and Saint-Simon, were the first modern socialists who criticised the excessive poverty and inequality of the Industrial Revolution. They advocated reform via the egalitarian distribution of wealth and the transformation of society to small communities without private property. Saint-Simon delineated collectivist principles to reorganize society and build socialism upon planned, utopian communities. Linguistically, the contemporary connotation of the words socialism and communism accorded with the adherents' and opponents' cultural attitude towards religion. In Christian Europe, of the two, communism was believed the atheist way of life. In Protestant England, the word communism was too culturally and aurally close to the Papist Roman Catholic communion rite, hence English atheists denoted themselves socialists.[12] In 1847, Friedrich Engels said "socialism was respectable on the continent, while communism was not." The Owenites in England and the Fourierists in France were considered socialists, while working-class movements that "proclaimed the necessity of total social change" denoted themselves communists. This latter branch of socialism was powerful enough to produce the communisms of tienne Cabet in France and Wilhelm Weitling in Germany.[13]

FEATURES OF SOCIALISM
1.)COLLECTIVE OWNERSHIP 2.)CENTRAL ECONOMIC PLANNING 3.)WELL DEFINED SOCIAL & ECONOMIC OBJECTIVES 4.)ECONOMIC EQUALITY 5.)EQUAL OPPORTUNITY

Features of Socialism
(1) Collective Ownership: Social or collective ownership of means of production is the fundamental feature of socialism and it is here that the difference mainly lies with capitalism. The resources of the economy are owned by the government or by the community collectively. The economic activity is guided by certain social objectives and not for the profit of the few. The management of resources may be directly under the control of the government, through a Department of the Ministry (like Post, Telecommunication or Railways in India) or may be entrusted to a specially created and constituted authority for the purpose such as Corporation, Board, etc. (Examples LI.C, E.B.). The administration may be centralised or decentralised and it may contain officials and non-officials. The essential point in this feature is that the power to take decisions rests with public authorities who are supposed to act in the general interest and not with individuals desirous of making profit. Hence, it should be understood that even in socialism there will be a private sector where individuals can carry on production for profit. But these private operations will be very negligible, small and incapable of playing a big role or influencing the economic activity of the people. Since the government and public sectors own and manage the major part of the resources, these private units will have to necessarily depend upon the public sector and government for finance, transport and distribution. (2) Central Economic Planning: Planning becomes an integral part of socialist economy. Planning implies the making of major economic decisions what and how much is to be produced, and to whom it is to be allocated by the conscious decision of a determinate authority, on the basis of a comprehensive survey of the economic system as a whole. Though planning may be available in non-soicalistic systems, it is a must in socialism. In the absence of profit motive and national ownership of resources, production and distribution would become impossible without a centralized authority, planning the diversions and utilization of resources. (3) Well defined Social and Economic objectives: The activities of the socialistic economy through the central planning authority will have well-defined social and economic objectives. Utilization of resources, production, distribution, consumption pattern, fiscal measures, credit

policies, social programmes would be aiming at certain goals. The socioeconomic goals may be industrialisation, economic growth, social justice, etc. (4) Economic Equality: Another feature of socialism is economic equality or aiming at economic equality. The absence of private property and profit motive naturally reduces the possibilities of inequalities. Besides, in the working of the economy, possible steps will be taken to see that there are not much disparities in income. Hence, there will be less of inequality, if not equality in socialistic system. (5) Equal Opportunity: This system attempts at giving equal opportunities to all by reducing inequalities and by social upliftment programmes. Exploitation will not be possible due to the absence of capitalist class. Division of the Society into haves and have-nots is not possible. Division society and elimination of class struggle by giving equal opportunity is one of the basic features of socialism.

MERITS OF SOCIALISM

1.)BEST UTILIZATION OF RESOURCES 2.)ELIMINATION OF UNEMPLOYMENT 3.)ECONOMIC EQUALITY 4.)MAXIMUM SOCIAL WELFARE Theoretically, the following merits are attributed to the socialistic order of society. (1) Best Utilization of Resources: Socialistic economy can bring about efficient and best utilization of resources because of (i) centrally directed planning; (ii) absence of private property; (iii) absence of profit motive; and (iv) well-defined objective . (2) Elimination of unemployment: Since the economy is a planned one, it can reduce the forces causing instability and unemployment. The system eliminates cyclical fluctuations in the economy and tries to attain stability. During the Great Depression in the early thirties, when all countries of the world were under the grip of depression and unemployment, Russia was markedly unaffected by the world-wide economy which protected against business and economic instability. (3) Economic Equality: The most important merit of socialism is its attempt to bring about a far greater degree of economic equality than what is possible under capitalistic enterprise. Inequality cannot be justified under any circumstances; morally, socially, politically and economically. It leads to suffering and degradation. It denies equality of opportunity and

prevents the poor with ability to rise to a full stature. Though attempts are made to reduce inequalities even in capitalistic economics, it cannot go or succeed beyond a certain stage. (4) Maximum Social Welfare: Socialist economy tries to ensure maximum social welfare through maximization of satisfaction. This means that in social economy, maximum number of people will have maximum satisfaction. In capitalistic economy, because of profit motive, things will be produced for consumers who are willing to pay. Consequently, only the rich will get the commodities wanted by them. The rich alone, who are minorities in the community will get maximum satisfaction. The poor will not get even the basic necessities of life. But in socialism, commodities needed by the poor will be produced. Hence, the satisfaction will be maximum for the larger number of people.

Critcism of socialism
Weakness of Socialism
(1) Misallocation of Resources: The greatest weakness of socialistic system is the absence of automatic pricing process. When there is no price mechanism, there will be no basis for calculation of costs and prices. Under capitalism, the price mechanism directs the allocation of resources. The price of the commodity must be high enough to cover its costs. If this is so, i.e., if there is profit, production is maintained and if possible even increased. If this is not so, i.e., if there is loss, production is curtailed or abandoned. Hence resources tend to flow to those directions where there are profits, from the place where there are losses. Consumers choice and price mechanism operate solving the problems regarding the commodities to be produced, the quantity, quality, etc. But in socialism, there is no such thing as guiding mechanism, or consumers choice. In the absence of such a guiding mechanism, allocation of resources between different uses will be made arbitrarily.
Improper calculations of costs and determination of prices arise in socialist economy, because: (a) the factors of production are entirely owned by the government and hence they do not have a price; (b) in the absence of free pricing of factors, the cost of a commodity cannot be calculated; and therefore, (c) it becomes very difficult to decide what to produce and in what quantities. So, production and pricing under socialism will be done arbitrarily without taking into consideration of the needs of the people, nor is there any mechanism to ascertain the consumer needs or choices. In the absence of these, there will be misallocations of resources and socialistic production will be inefficient. (2) Loss of efficiency and productivity: Efficiency and productivity in an economy depend on powerful incentives. Hopes of gain and fear of loss are the powerful motives which sustain efficiency and productivity in a capitalistic economy. But in socialism, these two motives are absent. Hence, there is the danger of fall in efficiency as well as production in the economy leading to serious decrease in national income.

Socialism involves management by public officials who can never be efficient as private entrepreneurs. The bread and butter of public officials does not depend on their efficiency and success. Permanent government officials suffer from lack of initiative, inability to take quick decisions, nepotism and corruption. Socialism creates a bureaucracy of inefficient, lethargic, corrupt government officials who have little interest in their work or in the welfare of the people. Inefficiency, ineptness, indecision, indifference on the part of officials and the public sector would lead to poor productivity, shortage, and even scarcity. (3) Complexities of Administration: The burden of administration in socialism is very heavy. Because of government interference in every activity of the people, there should be some authority for deciding all problems relating to the economy. Under capitalism, the quantity and quality of output, rate of capital formation and other problems relating to the economy are decided automatically through the price-profit mechanism. But under socialism, all these problems have to be determined by the demi-gods. Of the departments after getting the orders from the archangels running the state. (4) Loss of Liberty: One of the main dangers of socialism is that it not only curtails individual liberty, but also takes away freedom completely. Under socialism, there is no scope for consumers sovereignty; the workers will have no choice of occupation; and labour will be treated just like any other economic resource. The consumers should take what is given and workers should work in such places as the authorities will decide. Of course, there will be no unemployment but this is hardly an advantage, because the terms of employment (hours, wages, etc.) will be fixed by the central authorities. Security of employment is no compensation for loss of liberty. There is no unemployment even in prisons. Curtailment of individual freedom and liberty would even go to the extent of exploitation of the individual. In socialism, there is the concentration of economic and political power with the state. The state directs resources and men into particular channels and the states authority is final and absolute. It is true that in socialism exploitation of individual by another is prohibited. But the state being the strongest, it can exploit the individual and this is easier, as the political and economic powers are vested with one single authority. The government controls the entire life of the community. In a country where the sole employer the state, opposition means death by slow starvation. The old principle: those who do not work shall not eat has been replaced by a new one; those who do not obey shall not eat Another danger is that when such wide powers are wielded by the state, there may be a scramble for the control of the government, and people in the higher strata will be itching for power. In such a scramble, it is possible that unscrupulous men will succeed. When men, or a body of men, who can make means subservient to their ends and who can create support for themselves by a show of power and by incitement among the people, of hatred against a common enemy, real or imaginary, then equality, stability and liberty will have no meaning at all in socialism. The dictatorial and totalitarian outcome of socialism is a serious danger and when once this type of socialism takes root firmly, the individual loses liberty economic and political and even intellectual.

The features, merits, weaknesses of socialism discussed above broadly cover communism also, as it is only an extreme type of socialism. It is also called Marxian socialism. We shall study in detail about Marxian approach to Socialism.

Criticisms of socialism range from disagreements over the efficiency of socialist economic and political models, to condemnation of socialist states. Many economic liberals dispute that the egalitarian distribution of wealth and the nationalization of industries advocated by some socialists can be achieved without loss of political or economic freedoms or reduced prosperity for a populace. Some critics consider socialism to be a purely theoretical concept that should be criticized on theoretical grounds; others hold that certain historical examples exist and that they can be criticized on practical grounds.There is much focus on the economic performance and human rights records of communist states. For extensive coverage of the debates surrounding criticisms of communism and Communist states, see criticisms of communism and criticisms of communist regimes. Critics often argue that socialist policies reduce work incentives and economic efficiency through the elimination of buying and selling of means of production, eliminating the profit and loss mechanism, lacking a free price system and relying on central planning. They also argue that socialism stagnates technology. They further argue implementing socialist policies reduces prosperity of the populace. Critics claim that Communist states provided low standards of living and committed numerous human rights violations, including millions of deaths caused directly or indirectly by the government. Estimates of the number of such deaths, in particular those that occurred in China and the Soviet Union, vary greatly depending on the source and methodology, with numbers ranging from under 30 million to 145 million worldwide. Critics of socialism often criticize the internal conflicts of the socialist movement as creating a sort of "responsibility void." Critics argue that the Soviet Union experienced a severe economic downturn in the 1970s and 1980s, which contributed to its collapse, and that China has been reforming since towards a more market-oriented economy.[citation needed] The Catholic Encyclopedia states that priests and other religious persons were killed by mobs or by order of the leaders of the Paris Commune.[1] Others have accused social anarchists fighting in the Spanish Civil War of atrocities committed in regions under their control. [2] Critics of Israeli kibbutzim have accused them of economic mismanagement, leading to a $17 billion government bailout and declining populations.[3] Critics also find fault with the early communities of utopian socialism, such as Robert Owen's New Harmony, Indiana, Charles Fourier's North American Phalanx, and many other similar attempts, which were short-lived.
[4]

The criticisms presented below may not apply to all forms of socialism (for example, many of the economic criticisms are directed at a Soviet-style command economy). Some forms of socialism advocate state ownership of capital in a mixed or market economy, while other forms advocate economic planning and state-ownership of capital. Some forms of socialism, such as social democracy, advocate a mixed system where state and private firms co-exist alongside tax-funded welfare programs, while other strands of socialist thought reject state

ownership altogether and instead argue for participatory planning and non-governmental cooperative ownership. The socialist movement began to develop in India with the Russian Revolution. However, in 1871 a group in Calcutta had contacted Karl Marx with the purpose of organizing an Indian section of the First International. It did, however, not materialize.[1] The first article in an Indian publication (in English) that mentions the names of Marx & Engels printed in the Modern Review in March 1912. The short biographical article titled Karl Marx a modern Rishi was written by the Germany-based Indian revolutionary Lala Har Dayal.[2] The first biography on Karl Marx, in an Indian language was written by R. Rama Krishna Pillai in 1914.[3] Marxism made a major impact in India media at the time of the Russian Revolution. Of particular interest to many Indian papers and magazines was the Bolshevik policy of right to self-determination of all nations. Bipin Chandra Pal and Bal Gangadhar Tilak were amongst the prominent Indians who expressed their admiration of Lenin and the new rulers in Russia. Abdul Sattar Khairi and Abdul Zabbar Khairi went to Moscow, immediately on hearing about the revolution. In Moscow, they met Lenin and conveyed their greetings to him. The Russian Revolution also had an impact of migr Indian revolutionaries, such as the Ghadar Party in North America.[2] The Khilafat movement contributed on the emergence of early Indian communism. Many Indian Muslims left India to join the defense of the Caliphate. Several of them became communists whilst visiting Soviet territory. Even some Hindus joined the Muslim muhajirs in the travels to the Soviet areas.[4] The colonial authorities were clearly disturbed by the growing influence of Bolshevik sympathies in India. A first counter-move was the issuing of a fatwa, urging Muslims to reject communism. The Home Department established a special branch to monitor the communist influence. Customs were ordered to check the imports of Marxist literature to India. A sizeable amount of anti-communist propaganda publications were published.[5] The First World War was accompanied with a rapid increase of industries in India, resulting in a growth of an industrial proletariat. At the same time prices of essential commodities increased. These were factors that contributed to the build up of the Indian trade union movement. Unions were formed in the urban centres across India, and strikes were organized. In 1920, the All India Trade Union Congress was founded.[6] One one Indians impressed with developments in Russia was S. A. Dange in Bombay. In 1921, he published a pamphlet titled Gandhi Vs. Lenin, a comparative study of the approaches of both the leaders; but, Lenin coming out as better of the two. Together with Ranchoddas Bhavan Lotvala, a local mill-owner, a library of Marxist Literature was set up and publishing of translations of Marxist classics began.[7] In 1922, with Lotvala's help, Dange launched the English weekly, Socialist, the first Indian Marxist journal.[8] Regarding the political situation in the colonised world, the 1920 second congress of the Communist International stipulated at a united front should be formed between the proletariat, peasantry and national bourgeosie in the colonial countries. Amongst the twenty-

one conditions drafted by Lenin ahead of the congress was the 11th thesis which stipulated that all communist parties must support the bourgeois-democratic liberation movements in the colonies. Notably some of the delegates opposed the idea of alliance with the bourgeoisie, and preferred support to communist movements of these countries instead. Their criticism was shared by the Indian revolutionary M.N. Roy, who attended as a delegate of the Communist Party of Mexico. The congress removed the term 'bourgeois-democratic' in what became the 8th condition.[9] The Communist Party of India was founded in Tashkent on October 17, 1920, soon after the Second Congress of the Communist International. The founding members of the party were M.N. Roy, Evelina Trench Roy (Roys wife), Abani Mukherji, Rosa Fitingof (Abanis wife), Mohammad Ali (Ahmed Hasan), Mohammad Shafiq Siddiqui and M.P.B.T. Acharya.[10][11] The CPI began efforts to build a party organisation inside India. Roy made contacts with Anushilan and Jugantar groups in Bengal. Small communist groups were formed in Bengal (led by Muzaffar Ahmed), Bombay (led by S.A. Dange), Madras (led by Singaravelu Chettiar), United Provinces (led by Shaukat Usmani) and Punjab (led by Ghulam Hussain). However, only Usmani became a CPI party member.[12] On May 1, 1923 the Labour Kisan Party of Hindustan was founded in Madras, by Singaravelu Chettiar. The LKPH organized the first May Day celebration in India, and this was also the first time the red flag was used in India.[13][14][15] On December 25, 1925 a communist conference was organized in Kanpur. Colonial authorities estimated that 500 persons took part in the conference. The conference was convened by a man called Satyabhakta, of whom little is known. Satyabhakta is said to have argued for a national communism and against subordination under Comintern. Being outvoted by the other delegates, Satyabhakta left both the conference venue in protest.[16] The conference adopted the name Communist Party of India. Groups such as LKPH dissolved into the unified CPI.[17] The migr CPI, which probably had little organic character anyway, was effectively substituted by the organization now operating inside India.

Fidel Alejandro Castro Ruz (born August 13, 1926) was one of the primary leaders of the Cuban Revolution, the Prime Minister of Cuba from February 1959 to December 1976, and then the President of the Council of State of Cuba until his resignation from the office in February 2008. He is currently the First Secretary of the Communist Party of Cuba. He was born into a wealthy family and acquired a law degree. While studying at Havana University, he began his political career and became a recognized figure in the politics of Cuba.[3] His political carreer continued with nationalist critiques of Fulgencio Batista, and of the United States' political and corporate influence in Cuba. He gained an ardent, but limited, following and also drew the attention of the authorities.[4] He eventually led the failed 1953 attack on the Moncada Barracks, after which he was captured, tried, incarcerated and later released. He then traveled to Mexico[5][6] to organize and train for an assault on Batista's Cuba. He and his fellow revolutionaries left Mexico for the East of Cuba in December 1956. Castro came to power as a result of the Cuban revolution that overthrew the U.S.-backed[7] dictatorship of Fulgencio Batista,[8] and shortly thereafter became Prime Minister of Cuba.[9] In 1965 he became First Secretary of the Communist Party of Cuba and led the transformation of Cuba into a one-party socialist republic. In 1976 he became President of the Council of State as well as of the Council of Ministers. He also held the supreme military rank of Comandante en Jefe ("Commander in Chief") of the Cuban armed forces. Following intestinal surgery from an undisclosed digestive illness believed to have been diverticulitis,[10] Castro transferred his responsibilities to the First Vice-President, his younger brother Ral Castro, on July 31, 2006. On February 19, 2008, five days before his mandate was to expire, he announced he would neither seek nor accept a new term as either president or commander-in-chief.[11][12] On February 24, 2008, the National Assembly elected Ral Castro to succeed him as the President of Cuba.[1] Many describe him as a dictator[13][14][15][16][17] and his rule was the longest to-date in modern Latin American history.[14][15][16][17] Human rights organizations accuse him of creating a "repressive machinery".[18]

Ernesto "Che" Guevara (June 14,[1] 1928 October 9, 1967) commonly known as Che Guevara, El Che, or simply Che, was an Argentine Marxist revolutionary, politician, author, physician, military theorist, and paramilitary guerrilla leader. Since his death, his stylized image has become a ubiquitous global symbol of counterculture.[4] As a young medical student, Guevara traveled throughout Latin America and was transformed by the endemic poverty he witnessed.[5] His experiences and observations during these trips led him to conclude that the region's ingrained economic inequalities were an intrinsic result of monopoly capitalism, neocolonialism, and imperialism, with the only remedy being world revolution.[6] This belief prompted his involvement in Guatemala's social reforms under President Jacobo Arbenz Guzmn, whose eventual CIA-assisted overthrow solidified Guevara's radical ideology.