Market socialism is defined as “a type of economic system involving the public, cooperative or social ownership of the means of production in the framework of a market economy.” First, we will dissect the terminology used. Market socialism is in reality not a form of socialism by any means, but rather another manifestation of capitalist relations. Why cannot market socialism be defined as socialism? Henceforth we will examine this question. In Critique of the Gotha Programme, Marx delineates the differences between the lower phase of communism and the higher phase: “In a higher phase of communist society, after the enslaving subordination of the individual to the division of labor, and therewith also the antithesis between mental and physical labor, has vanished; after labor has become not only a means of life but life’s prime want; after the productive forces have also increased with the all-around development of the individual, and all the springs of co-operative wealth flow more abundantly.” Lenin elaborates on this in State and Revolution: “What is usually called socialism was termed by Marx the “first”, or lower, phase of communist society…” We can now see that Marx’s definition of lower-stage communism is socialism. Therefore, if something is to be considered rightly as socialism, it must meet Marx’s definition of lower-stage communism. This fact means that the definition of communism is what socialism constitutes, excluding the aforementioned distinctions of the higher phase found in Critique of the Gotha Programme. This definition manifests itself as the negation of capital and capitalist relations. Thus, from the Manifesto: “In this sense, the theory of the Communists may be summed up in the single sentence: Abolition of private property.” As Marx writes in Economic and Philosophical Manuscripts of 1844: “Wages are a direct consequence of estranged labor, and estranged labor is the direct cause of private property. The downfall of the one must therefore involve the downfall of the other.” Therefore, if wages are also not abolished, then private property is also not abolished, and vice versa. Transferring private property from the bourgeoisie to the workers at large, as advocated in market socialism, makes up a portion of this abolition of private property. However, to stop at that is Proudhonian in nature. Private property is conferred onto the workers but it is still fundamentally retained, as wages are retained in the co-op market structured economy. This therefore means that private property has not in fact been abolished as wages have not been abolished. Thus, we can already see that market socialism is in fact not socialism at all due to its retention of wage labor and private property. It is rather a transformation of capitalist relations. However, let us analyze market socialism further. Market socialism retains commodity production, as goods are produced not for use, but rather for exchange and thus for the accumulation of capital, rather, since the profit motive is retained due to not producing for use-value. Co-op economies will thus function just as normal capitalist economies function, and all critiques of normal capitalist relations thus apply. We can now see how market socialism is not a metamorphosis of capitalism to socialism, but rather just a mere alteration to present-day capitalism and its associated relations.
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