22

I had a discussion with a friend because I would argue that Denmark is not a socialist country. We have a welfare state and therefore pay high taxes, however we have a free market and privately owned companies. Even things that are "free" like school and medical care that is owned and operated by the state has competition through private schools and private hospitals which you pay to attend.

Now the problem arose because the railroad system in Denmark is owned by the state and so it is only the state owned company that can use these railroads (called DSB). So there is a monopoly on train transportation, which favor the state. The government has decided that DSB (the transportation company) has a time period where they have the right to use the rail roads alone and when the time is up, others can appear on the market, however this period is always extended 30 years from time to time.

This sounds a lot to me like a socialistic trait. Does that mean that we have a mix of capitalism and socialism?

New contributor
Keinicke is a new contributor to this site. Take care in asking for clarification, commenting, and answering. Check out our Code of Conduct.
  • 14
    Would you consider government ownership of roads to be socialism? How much freight traffic travels on Danish railroads? Because in the US, just about all passenger railroads are government entities (that often run on privately-owned freight railroads, where they have to compete with freight traffic). Passenger rail could be considered more of a "commons" than freight rail - something that a democratic society decides they want to be more accessible than it would as a privately-owned competitor in a free market - better traffic flow, shorter commute. – Just Me Dec 2 at 20:33
  • 47
    I think these things are not well defined. In the USA, "socialism" is often used as a pejorative but most people who use it as a pejorative actually support government ownership of key (to them, e.g, highways) industries. Go to a Trump rally and start talking about selling the local highway to a private toll company and they will call you the socialist. – emory Dec 2 at 21:40
  • 21
    Every country with state run schools has socialist traits. Any welfare programs, public owned roads or bin collections paid for with taxes are socialist traits. – Jontia Dec 2 at 23:06
  • 3
    Your arguement re bin collection sounds like 'What I think is sensible for the state to do is not a socialist policy' and very similar lines of thought could be advanced for education, gas, water, electricity, broadband, policing, health and fire services. Especially in low population density areas. – Jontia Dec 3 at 9:05
  • 4
    Serious question because I do not know, but does Denmark have a law saying an private entity may not make it's own railroad for it's own purposes? Because in the United States, the most used rail services are government owned and operated but they aren't the only one. Consider that Disney runs the third most traveled monorail system in the world while Florida's Sunrail trains are a private enterprise, and the under construction Texas Central Railway will be the first dedicated high speed rail system in the nation is entirely privately owned and managed (Service starts in 2025). – hszmv Dec 3 at 19:48

11 Answers 11

98

Yes.

You have set up a false dichotomy: that either a country is "socialist" or "capitalist". Nearly all countries have aspects of both.

In socialism, the ownership of property and the "means of production" are held in common (typically ownership is assigned to a government). In capitalism, ownership is held by private individuals and companies. Denmark has aspects of both systems. In this it is entirely unremarkable, and the same is true of nearly every other country.

Few "socialists" actually believe that all property should be held in common. Few capitalists think that the state should have no property and produce nothing. Instead a "socialist party" believes that the balance should be different to a capitalist party: for example a socialist party may think that the government should own rail, health, and utility industries (perhaps alongside privately owned companies). A capitalist party might believe that these industries should be entirely privately owned (but think that education should still be provided by the state). There is nothing surprising about that.

  • 1
    Comments are not for extended discussion; this conversation has been moved to chat. – yannis 2 days ago
34

There are over 40 definitions of socialism. However a common-enough one (SEP) is that:

The bulk of the means of production is under social, democratic control.

And in contrast the corresponding definition of capitalism entails:

The bulk of the means of production is privately owned and controlled.

Under these definition the answer is no, you can't have both socialism and capitalism at the same time in a country. Either the bulk of means of production is in private hands or it's "socially owned". (Actually, that SEP page also allows for a "statism", in which the state owns most of the means of production but the state is not under democratic control. I'm glossing over this distinction between socialism and "statism" here.)

Wikipedia provides a fairly similar definition of socialism, but with a less clear threshold:

Socialism is a range of economic and social systems characterised by social ownership of the means of production and workers' self-management.

Under this definition it's more arguable when something is to be called socialism.

In general, economic publications don't try to put such socialism vs. capitalism labels on countries nowadays. Rather more objective figures like the percentage of state-ownership in the economy and/or the percentage of people employed by the state. For the latter (which is somewhat more objective to calculate as you don't have to try to estimate the value of schools or hospitals) Wikipedia has a list. For example Demark has about 32% of employees in the state sector, whereas it's around 16-19% in the US. For a proper contrast, the page also notes that

In the former Eastern Bloc countries, the public sector in 1989 accounted for between 70% to over 90% of total employment.

Even on such apparently simple employment figures data can be somewhat misleading due to subcontracting

Germany, for example, spends as much as France on health, but has far fewer public employees in the sector. This is explained by the fact that health workers in Germany are generally paid by the administration through private contracts. France, more generally, rarely relies on subcontractors for public services, in contrast to Germany, Denmark and Finland.

So one can be largely paid by the state, but be technically a private employee... See public–private partnership (PPPs) for more on this latter issue. Arguably, PPPs are "less socialist" than outright employment by the state, but some right-wing/libertarian writers nonetheless declare PPPs the "backdoor to socialism"... So I hope you get some idea why answers to your questions depend on definitions.


If you want to move beyond mere ownership and employment by the state, to the state exercise of regulatory power or even dirigisme over the (rest of) the economy, things can get even more complicated. According to some research, the Nordic countries actually exercise less regulatory control than the US so there is more "business freedom" in the Nordic countries according to some indexes, including by OECD, World Bank or (even) the [US-based] Heritage Foundation standards. This despite the higher taxes and social spending in the Nordic countries. Consequently, some argue that a unidimensional scale [never mind a pure dichotomy] of socialism vs capitalism is rather misleading nowadays.

  • This is actually is very good answer. But how can our primeminister even say that we are not socialis then? – Keinicke Dec 3 at 10:15
  • 3
    In the UK, PPP under the name of Public Finance initiatives were called the Back door to privatisation, which in the context of this question would be the backdoor to capitalism. – Jontia Dec 3 at 11:02
  • 1
    @Keinicke Well, the bulk of the means of production (and employment) is still in private hands, restricted and guided as they are by the government. To some people (like me), this means "very socialist", while others see it as "very capitalist". Subjective values come into this a lot. If your basic tenet is that things should be private by default (because there's respect for private property) and public property should be rare and only where it really makes sense, you see "socialism". But plenty of people have the opposite view - private only if necessary, public by default. – Luaan Dec 3 at 12:19
  • Denmark is an example of a "mixed economy" or a "social market economy". In both, the means of production are privately owned, and thus they are not "socialist", as you rightly conclude. – henning -- reinstate Monica Dec 3 at 16:21
  • 1
    @Jontia I guess that depends on where you come from: If you use a PPP to run a formerly state-owned railway, it's "a backdoor to privatization", if you use a PPP to run a formerly private-owned railway, it's "a backdoor to socialism". – Paŭlo Ebermann Dec 5 at 20:22
2

You mention private schools as competition for public schools in Denmark but I don't think that is the case as it appears that 80%+ attend public schools versus 15.6% in private schools. Also should note that those private schools are still largely funded by the government through the voucher system. I am not sure of the breakdown of private schools but I would wonder how many of them are a religious based school versus a secular one. Overall I am not sure that a 15.6% market share for private schools is much of a competition for government ones.

https://en.wikipedia.org/wiki/Education_in_Denmark

Government-funded education is usually free of charge and open to all. Denmark has a tradition of private schools and about 15.6% of all children at basic school level attend private schools, which are supported by a voucher system.

  • 1
    Yes, but the private schools might have a better school than the public once and since all parents have the choice, it's still competition. I believe parents can get compensation if they put their children in a private school too actually. But would you say that Denmark is socialist? And why? – Keinicke Dec 2 at 23:19
  • @Keinicke When you are talking about private schools only having 15.6% of the market it doesn't matter if they are better or not since it is very likely that there is a large amount of parents that don't have a choice of sending their kids to one for the simple fact that there isn't one around that would be able to accept them. That is if they are even able to afford them. – Joe W Dec 2 at 23:23
  • Well first of all, i have never heard of a private school rejecting new students, unless there are simply not enough space. But your other points are good. – Keinicke Dec 2 at 23:34
  • 3
    @JoeW Isn't that a classic "capitalist" tradeoff? You can take the expensive better thing, or the cheap worse thing. The fact that only 15.6% of people choose the expensive thing doesn't mean there is no competition. For example, you wouldn't say that iPhones don't compete with Android phones just because a small percentage of people choose iPhones. (Or that "dumb phones" don't compete with smartphones) – user253751 Dec 3 at 13:15
  • 1
    @JoeW But they really still are competing, because you don't see the prices in that area skyrocket because there is only one supplier. If it did, new players would(probably) enter the market, so the presence of a potential competitor is enough to make sure that they don't screw over costumers with no consequences. – Keinicke Dec 4 at 13:30
2

In "A Theory of Socialism and Capitalism", H.H. Hoppe outlines four flavors of blended capitalism and socialism, which are common throughout the world:

Socialism Russian Style: Total state rule of the means of production

Socialism Social-Democratic Style: Voters ask the state to own the means of production

The Socialism of Conservatism: Voters ask the state to own a little less than those to the left of them, but with some added behavioral/lifestyle restrictions in place. "Conservatism is progressivism driving the speed limit."

The Socialism of Social Engineering Economists or social theorists propose positivist arguments in favor of socialism on moral grounds, Keynesian-style calculations, etc.

Hoppe asserts that there are no "capitalist countries" since there is a fundamental contradiction between private ownership and state ownership. Meaning, if the state taxes your property or wages, you don't fully own your property or wages. If the state can't tax, the state cannot exist because it is broke and it produces nothing.

So, in summary: Yes, they can and do coexist.

Somewhat related: One reason capitalism and socialism exist together is because of the distribution of various moral foundation traits found throughout the population. Some people are born with a deep concern for harm and fairness, while others value heriarchy and purity. In countries where state socialism takes over, the state often kills, exiles, or jails capitalists in order to weed the population of opposition. The inverse also happened in Augsto Pinochet's Chile where communists and socialists were thrown to their death from helicopters.

  • About Hoppe's assertion: In theory you could have a state run on donation basis instead of taxes (to finance things like legislation and defense). Not sure whether this was tried yet. – Paŭlo Ebermann Dec 5 at 20:27
  • @PaŭloEbermann - yes, this the "crowd funded government" model where "users" pay for services, but some would argue that this sort of "state" may not hold the Monopoly of Force that is typical to all other states. Not sure how I feel about that definition, but I would like to see that method tried. – blud Dec 5 at 20:31
2

Yes, it is possible for both to exist in the same country. Some examples would be the USSR allowing private farm plots whose products could be sold by the individual, the Norwegian nationalized oil industry in an otherwise capitalist state or China today ( the socialism vs capitalism bit in China today is just pure chaos ).

Every socialist country has always had elements of capitalism, and probably all capitalist countries have had some elements of socialism.

  • I would argue that China in the 80s or 90s is a better fit, with the creation of "Special Economic Zones" that were supposed to be capitalistic. They even invented the slogan "One country two systems" (for a different political issue) to show they were ready to have capitalist islands in their socialist society. – Jan Dec 4 at 16:52
  • Socialism isn't state control of the means of production, it's working-class control i.e. meaningfully democratic decision-making by every worker in that society. – iono Dec 6 at 12:02
1

All countries are a combination of both systems. Even USSR was although a communist but their leaders in projects were paid for performance. If you are overseeing development of say a mine or a bridge, your speed to completion and budget merited you for monetary gains. This looks on the surface like a capitalist way of motivating individuals to preform their best but the same standard was not used for people down the hierarchy, they would have to just preform or risk being transferred to undesirable places, where stand of living would drop as well as income. You could get transferred to places where salaries are not being paid in time.

Another example of USSR is although they called each other comrades but everyone had rank and going up the rank would bring financial benefits. A complete capitalist or a communist-socialist system would not work.

We call US a capitalist country but it gives people unemployment benefits, retirement benefits, and so forth which is socialist concept. We call north korea communist but their population is starving because no market is able to survive in order to cater to their population. All resources are concentrated with one family. This is not what Marxs talked about when he spoke of redistribution of wealth.

My point is there was never a true communist country or a capitalist country. Countries which had succeeded were able to realize how to bring maximum benefit to largest risk takers but at the same time give them the security they need to take risks if they fail. This is capitalist and socialist system working together.

New contributor
new coder is a new contributor to this site. Take care in asking for clarification, commenting, and answering. Check out our Code of Conduct.
  • 2
    You could have a capitalist society or group of some sort, but "Capitalist Country" may be a misnomer in itself: If a state must have a monopoly of force, how can it have that without using force (or threats of force) to collect tax revenue? Also: If it does use force, then pure capitalism is not actually in play, since capitalism is about voluntary transactions between conesting parties. – blud Dec 5 at 20:34
  • @blud Pure capitalism would be an Ayn Rand nightmare, as described in the Utopian concept of 'island' in her book Atlas Shrugged – new coder Dec 6 at 5:13
0

In my opinion it is similar to the concept of temperature. You have two ends to it - Hot and cold. Temperature of any object will be between these two extremes.

Similarly, socialism and capitalism are two extreme ends of governance model. It is a scale - it's both ends are utopia. Every society belongs to a point in between these extreme ends. Calling a state capitalist or socialist is a approximation. The amount of areas that a state controls in total decide whether it is a socialist state or a capitalist one.

New contributor
Mahesh V S is a new contributor to this site. Take care in asking for clarification, commenting, and answering. Check out our Code of Conduct.
0

Marxists view capitalism and socialism as opposed modes of production where specific relations of production predominate.

For the Marxist, capitalism is a social relationship where the value form and its expanded reproduction (commodities causing further commodities to be produced by wage labour) dominates. This is a society of wage labour and goods for sale. The dominant relation of production is ownership of capital purchasing labour power through wages in the form of commodities (usually money).

Socialism is hypothesised as a mode of production where each produces from ability and consumes from need. Solidarity, free giving, or doing for pleasure are the hypothesised relations of production.

As modes of production are viewed as exclusive, based on revolutions being required to unlock the juridical recognition of the dominant property relations, socialism and capitalism cannot coexist as modes of production outside of a revolutionary contest. Not even the most hopeful ultra from below or Marxist Leninist claims this about China.

However relations of production can coexist. Regardless of the ideologies of participants, socialist relations of production predominate in free software.

This matters little for your case study: western governments run wage labour organisations with private commodity monopolies. State ownership doesn’t mean social ownership. An elected boss is still a boss.

0

This question is impossible to answer as there are no clear definitions of "socialism" and "capitalism", but you may be interested to know that the system of the USSR under Stalin was called "state capitalism".

-1

"Coexist" is not the right word to describe the relationship.

Definitions:

  • Socialism stands for government driven agendas that shift control over the economy to the government. Be it by direct ownership, regulations, (more) taxation, subsidies, criminalization or otherwise.
  • Capitalism is the manifestation of individual liberties culminating in free market. As such it fundamentally opposes government intervention of any kind.

Socialism is inherently authoritarian and asserts control over people while capitalism does the opposite and allows them to make decisions on their own behalf. The more socialism you have within a society, the less capitalism you have - and vice versa. They are inherently in opposition to each other. Of course you can mix both systems, and that is the case for most countries in the world. But the simplified formula is this:

Capitalism = 100% - Socialism
 Socialism = 100% - Capitalism
      where each is a % between 0 and 100

The overarching philosophical positions are Individualism vs Collectivism. Individualism means you accept that people have a free will, make their own choices and live with the consequences of their own actions. Collectivism intents to override that by exerting top-down decision making by the force of the government. It fundamentally distrusts the individual to make sound decisions, but for some reason trusts its own "elite" to make them for everybody.

As such, "coexist" is not the correct word to describe the relation. Would you call the relation between wolves and sheep a mere "coexistence"? Both always exist to some magnitude of course. Most political parties inherently inhabit some ratio of both concepts, and that ratio usually defines their position on the political spectrum. Some people believe some government intervention is preferable, some believe a lot is preferable. Most political discourse is revolving between these two sides. The more extreme stances are rather sparsely represented - even though the one side (collectivist/socialist one) was quite predominant in the 20th century and still in some countries today, and even on social media and academia in form of neo-Marxism.

Info: Logically Socialism is not the only way to exert authoritarian rule, but most, if not all of its agendas are authoritarian and collectivist in nature.

New contributor
Battle is a new contributor to this site. Take care in asking for clarification, commenting, and answering. Check out our Code of Conduct.
  • Please add some references to support this. Did you take the dichotomy formula on capitalism and socialism from literature? – JJ for Transparency and Monica Dec 5 at 12:28
  • @JJforTransparencyandMonica - The formula is a simplification of that dichotomy, and as such universal for all potential dichotomies. The question is if it applies to Socialism & Capitalism - and my answer as a Libertarian is yes. Samuel Russell (another answerer here), occupying a socialist position, came to the same conclusion. But that is self-explanatory: The more control you assert top-down (via the government), the less control the individual has over itself. The more laws you demand to follow, the less people will be able to do. Maximize that to its extreme, and you get quasi-slavery. – Battle Dec 5 at 13:03
  • 1
    Okay so really socialism and capitalism in your answer are used to signify less or more top-down control? Of course by arguing like that you get to a dichotomy, but it's not clear that that's all that's to those two terms. That's really what you need to argue, and I'm wondering what references you're basing that simplification on (I think there's more to both socialism and capitalism). – JJ for Transparency and Monica Dec 5 at 13:09
  • @JJforTransparencyandMonica - What coercive elements does Capitalism exhibit and what pro-liberty elements does socialism exhibit? For info - the collusion of individual entities (big corporations) and the state is known as Economic Fascism - or: Lobbyism, Oligarchy, Aristocracy, "Crony Capitalism" (often used derogatorily for capitalism, which btw is already meant derogatorily, coped by Marx). And the "liberty" not having to work, at the cost of other people's money is based on government invoked "wealth transfer." – Battle Dec 5 at 13:17
-2

While nobody in Europe would claim to be living in a socialist country, it is a recent American political trope to define European countries, Nordic countries especially, as socialist. For some reason, probably related to the abuse of the word "socialism" across the pond, the Prime Minister of Denmark felt the need to make our transatlantic friends aware of this fact: https://www.youtube.com/watch?v=RO7wgS5tdz4

In my opinion the problem is that if by "socialism" we mean the property of a human organization that provides welfare or infrastructure to those living within its jurisdiction, then all empires and kingdoms and countries in the history of mankind would be "socialist", from the Persian empire and the Greek poleis to the Russian empire. If any country providing welfare or infrastructure has "some elements of socialism", then every human organization has "elements of socialism". In either case, we end up with an empty and irrelevant definition of socialism.

The US, France, Germany, Denmark, etc... are market economies, where public ownership or control are often exerted with market outcomes in mind, such as addressing or preventing market failures. Public ownership or regulation of natural monopolies (such as the public water supply or the railroad network) are examples of such interventions. Similarly the carbon tax is an example of a regulation aimed at another market failure, the negative externality caused by CO2 emissions. More controversially, we may say that the American healthcare system is another example of a market failure (see the much larger health expenditure pro capita in the US compared to Denmark, for little or no gain), but there may be other factors at play I'm not aware of (such as geographic peculiarities, life style, etc...).

A market economy is not compatible with any usable definition of socialism, so my answer is no.

New contributor
didymus is a new contributor to this site. Take care in asking for clarification, commenting, and answering. Check out our Code of Conduct.
  • This makes the same mistake as the question assuming socialism and capitalism are two entirely mutually exclusive philosophies, when the answers already present show that this is not the case. – Jontia Dec 4 at 9:04
  • I’m claiming that if the existence of public infrastructure or welfare institutions in a social organisation make that organisation socialist or confer such organisation with a degree of socialism, then I can’t think of any human organisation, let it be a country or an empire or a book club, that doesn’t have the property of being socialist. So this definition of socialism is devoid of any meaning, because it is a synonym of “human organisation”. – didymus Dec 4 at 9:34
  • That doesn't mean the definition is invalid. Just because the label applies to all countries doesn't make it useless. And it only applies to all "human organisations" because labour laws based on socialist ideals make it apply. I'm sure you could very quickly find employers in relatively recent history that did not provide any social safety net for their workers. – Jontia Dec 4 at 9:52
  • It is useless because it can be applied to anything, and so “can socialism and capitalism coexist” is equivalent to “is it possible to exist and to be a capitalist country?” which ultimately is a question about the existence of capitalism. Safety nets and labour laws are not inherently socialist because they existed long before the word “socialism” even existed. – didymus Dec 4 at 10:25
  • @didymus yea well group of rodents didn't exist before the rat, but it still inherently includes the rat. So the tearm socialism is probably something we came up with, exactly to label some ideas or implementations in our society, which might or might not be safety nets and labour laws. – Keinicke Dec 4 at 14:21

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .