by David Thill

Created on: June 27, 2009   Last Updated: June 30, 2009

Socialism and Capitalism are economic systems, democracy is a philosophy of government. Setting aside that little quibble, all modern capitalist societies contain elements of socialism, and no completely socialist society has ever existed.

Dealing with democracy first, however, most nations which claim to be democracies really are . . . to one degree or another. Democracy is simply a philosophy which believes that the legitimate right to govern is owned by the people, not some elite created by birth, religion or history. Within that broad definition, there are more types and flavors of democracy than most people could ever be bothered to think about, and new quirks and curiosities are added every day. There are very few places in the world that are entirely undemocratic: perhaps North Korea, maybe Myanmar, possibly a couple of other isolated places in the clutches of one form of dictatorship or another. Most places we in the West consider undemocratic do, in fact, have democratic elements, some of them quite important and significant.

Take China as an example. Most Westerners still think of it as a country which is still in the clutches of an undemocratic elite, who just happen to have thrown away most of the old communist system but held on to the government. Even if you ignore the fact that local and regional leaders are quite often elected by popular vote these days, the Communist Party of China is no tiny club of scheming power-mongers. The Party retains a firm grip on power, but the Party itself is composed of upwards of 70 million Chinese citizens representing people of all walks of life. China is certainly no leading light of democracy, but clearly there are important democratic elements in the government of this country that many westerners would not think of as a true democracy.

Socialism and Capitalism are elements that exist in virtually every nation, whatever claims the government may make to be one or the other. The definition of capitalism is simply that the means of production (factories, land, resources) are owned by individuals or groups of individuals and used to generate profits. Socialism advocates placing the means of production in the hands of the state or some kind of nonprofit cooperative and using these resources more to help create an equitable society than to maximize profits. Clearly, in today's world, both elements exist side by side in most nations.

The United States, long seen as one of the most capitalist (and democratic) societies in the world, still contains many elements of socialism. Programs like Medicare and Social Security are seen as more socialist than capitalist, but modern democracies all seem to have concluded that the nation has a moral obligation to at least provide a little assistance to the sick and those who have worked hard all their lives. As for ownership of the means of production: just how much of General Motors does the US Government own now?

The old "socialist" countries were never as socialist as they liked to claim. In the United Soviet Socialist Republics, although most businesses and property were owned by the state, there always existed smaller entrepreneurial companies, and even individual landowners. The market was never truly abolished, and a thriving underground economy of buyers and sellers was quietly ignored throughout the country's history.

The challenge in deciding whether countries call themselves socialist or capitalist or democratic, is that all three terms are defined differently in different places and at different times. All it is possible to conclude for sure is that all three philosophies are widespread and very much a dynamic part of the world today.

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