Capitalist Nationalization Isn’t Socialism

Katy Slininger, Quiet Corner DSA

“The immediate aim of the Communists is the same as that of all the other proletarian parties: constitution of the proletariat into a class, overthrow of bourgeois rule, conquest of political power by the proletariat.” (Marx & Engels, The Communist Manifesto)

Nationalization is having a resurgence among self-described socialists, with proposals for state seizures of various industries and properties becoming increasingly popular. Most commonly, we’ve been seeing demands for a seizure of fossil fuel companies, along with (sometimes half-joking) calls to bring various near-monopolistic corporations under control of the U.S. government.

While central planning should be the cornerstone of a socialist society, these proposals ignore a material reality: we don’t have a socialist society. What we do have is a bourgeois state that prioritizes ruling class interests over public good and violently oppresses the lower class—and socialists know this. So why are some of those same socialists so eager to push nationalization projects within a capitalist system?

A social democratic model of nationalization ignores issues of power. It assumes that public will within our existing political structure could override the existing incentives for politicians to preserve, for example, the independence of the fossil fuel industry. It also ignores basic realities of our volatile political system: the transience of legislation, the disenfranchisement of the working class, and the inevitable exploitation of expropriated industries by capitalist politicians and their corporate conspirators.

Nationalization of energy within a capitalist system is a common social democratic solution to both a weakened welfare state and climate change — it provides wealth to fund social programs while (supposedly) allowing for a democratic transition to renewable energy. However, we should analyze how a capitalist nationalization project plays out by looking at Norway through a socialist lens. Its nationalized oil company, Equinor, is a huge business funding their welfare state — a social democratic dream! But, as it is controlled by a capitalist government, it operates globally as any other profit-seeking venture by continuing the exploitation of finite natural resources. In fact, it will soon begin a controversial drilling project in the Great Australian Bight.

When a capitalist country nationalizes a fossil fuel industry, and builds social programs off those profits, it only further yolks us to the continuation of extractivism. It is an adaptation of capitalism rather than a step towards socialism.

Even nationalization projects that plan on decommodifying the products or services (like state-owned housing or transportation) have to grapple with the limitations of our political system. We can use our national parks as an example of inevitable deterioration after capitalist nationalization. Land, resources, and wildlife which were previously under federal protection are immediately compromised when power shifts from one administration to the next. The transitory nature of seizures under capitalism is also apparent in other publicly-owned properties like social housing and transportation, which are undermined by electoral swings and their corresponding budget fluctuations. We cannot engage in idealism that ignores both historical and current erosion of services and property under federal ownership.

Capitalist nationalization completely depends on the assumption that, in our current political system, public will translates into policy. A socialist movement should not waste political energy pushing for reforms whose hypothetical success is dependent on an utopian vision of American democracy. We have tycoons in public office, industry lobbyists exercising control over government decisions at every level, and resilient structures specifically designed to limit civic influence. This capitalist control is not a flaw of a bourgeois democracy that we can fix through reforms in the interest of socialized production, but a feature: “The state is an organ of class rule, an organ for the oppression of one class by another; it is the creation of ‘order,’ which legalizes and perpetuates this oppression by moderating the conflict between classes.” (Lenin, State and Revolution, Ch. 1)

Even if citizens were heavily in favor of nationalization of fossil fuel companies and a subsequent transition to renewable energy, and were capable of effectively exercising power (an impossible  qualification under a bourgeois state), we cannot ignore the danger of centralizing property and profit in a capitalist political system.

Centralisation of capital was the key process in the transition from feudalism to capitalism, and continues to increase the power of capitalists: “One capitalist always kills many. Hand in hand with this centralisation, or this expropriation of many capitalists by few, develop, on an ever-extending scale[…]the entanglement of all peoples in the net of the world market, and with this, the international character of the capitalistic regime.” (Marx, Capital, Vol. 1, Chapter 32)

The call to seize the means of production has been perverted into a project to centralize production under the ruling class. However, “seizing the means of production” is only socialist when it signifies either 1) a specific step in a revolution when workers take control over their workplace or industry or 2) the seizing of all production by the dictatorship of the proletariat. The former serves to radicalize workers, diminish the power and control of capitalists, and build the capacity of workers to collectively abolish the bourgeois state. The latter definition describes the process by the dictatorship of the proletariat as described by Engels:

“The first act by which the [proletariat] state really comes forward as the representative of the whole of society—the taking possession of the means of production in the name of society—is also its last independent act as a state.” (Engels, Anti-Duhring, referencing the actions of a proletariat state before it necessarily “withers away”)

The casual association of nationalization with socialism is lazy at best, and dangerous revisionism at worst—even fascist states have centralized production, seized industries, and built welfare programs.

The choice between the evils of privatization and the failures of undemocratic state control of an industry is a false one that turns liberals into foot soldiers for capitalism. Socialists need to build power among workers so they can actually seize the means of production themselves. By doing so, socialists reclaim power from both corporations and, eventually, the bourgeois state. A centrally-planned economy is necessary for survival—but ensuring proletarian control over the state, and transforming it into a socialist administration must come first.

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