Capitalism, Socialism and Democracy

by Joseph A. Schumpeter

Capitalism, Socialism and Democracy remains one of the greatest works of social theory written this century. When it first appeared the New English Weekly predicted that 'for the next five to ten years it will cetainly remain a work with which no one who professes any degree of information on sociology or economics can afford to be unacquainted.' Fifty years on, this prediction seems a little understated.

Why has the work endured so well? Schumpeter's contention that the seeds of capitalism's decline were internal, and his equal and opposite hostility to centralist socialism have perplexed, engaged and infuriated readers since the book's publication. By refusing to become an advocate for either position Schumpeter was able both to make his own great and original contribution and to clear the way for a more balanced consideration of the most important social movements of his and our time.

Genres: Economics, Politics, Nonfiction, Philosophy, History, Sociology, Political Science

464 pages, ebook

First published January 1, 1942

About the author

People know Moravian-born Joseph Alois Schumpeter, an American, for his theories of socioeconomic evolution and the development of capitalism.

This political scientist briefly served as finance minister of Austria in 1919. Of the 20th century, the most influential Schumpeter popularized the term "creative destruction."

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

Reviews

[Joe · Rating 5 out of 5]

Comment:

In the end it will be seen that the greatest enemy of capitalism was always democracy, i.e. the will of the people. Once the people turn anti-capitalistic, under the influence of a disaffected intelligencia, there is absolutely nothing that can stand against them. Schumpeter at one and the same time believes that Capitalism is the most adequate description of economic reality and that it is doomed. How is this possible? - But it is exactly as the Savior of the Christians said so long ago: 'Man does not live by bread alone.' Capitalism provides bread but lacks drama, romance, myth; that is why economic 'irrelevancies' and 'irrationalities' like (say) Communism and Christianity can never be (entirely) won over or destroyed. - What Capitalism cannot deliver will be discovered, or created, somewhere else. Eventually, one of these discoveries or creations will end the Capitalist era.

[Richard Thompson · Rating 4 out of 5]

I was surprised to find in Wikipedia that this is the third most cited book in the social sciences published before 1950 following only The Wealth of Nations and Das Kapital. I had no idea that it was so influential.

There are things here to like and hate and things to agree with or reject for people in every part of the political and intellectual spectrum. In commentaries that I have read a lot of people criticized Mr. Schumpeter as conservative and elitist. I can see those strains in his thought, but he also sees a lot of wisdom in Marx and seems convinced of the ultimate triumph of socialism, though he is largely neutral as to whether that would be a good or bad thing.

In analyzing capitalism, Mr. Schumpeter comes to the conclusion that perfect competition is not only impossible, but is even overrated and undesirable. In his view, price stability, big business and a certain amount of monopoly power are necessary for the functioning of a capitalist economy and bring some benefits that could not be achieved under perfect competition. Wow. These are not things that you usually hear even from the Chicago Boys. But this part of the book comes right after his initial discussion of Karl Marx where he finds error in the labor theory of value and in the concept of exploitation, but also finds much wisdom. By this point my head was spinning. Is this guy on the left or the right or what?

Next he gets into his famous theory of creative destruction so beloved by Silicon Valley entrepreneurs (though often for the wrong reasons). He sees the process of creative destruction where new businesses with better products and processes drive out the old as the principal mechanism of progress and improving standards of living for all. My main gripe with this part of his analysis is that it is deeply rooted in the idea that more output and more efficiency in making and distributing products is always a good thing without putting much weight on the disruption and suffering that are an inevitable part of the creative destruction process in a capitalist economy.

Despite the many good aspects of capitalism that he sees, he also expects capitalism to run its course and to evolve into socialism. He rejects Marx' notions of historical materialism and class struggle, but he still sees capitalism as sowing the seeds of its own destruction, particularly through the agency of disaffected intellectuals and circumstances that cause entrepreneurship and creative destruction to run out of steam. I expected that his next move was going to be to tell us why socialism couldn't work, but he didn't do that at all. To the contrary, his position as an economist is that there is no reason why a centrally planned socialist state could not operate with an efficiency approximately equal to our imperfect market economy. I'm not sure that was true when he published this book in 1943, but in today's world of high-speed networked computing and big data analysis I think we probably could devise a reasonably efficient centrally planned economy along the lines that Mr. Schumpeter proposes.

The next part of the book is a discussion of democracy. I think that Mr. Schumpeter is right in his conclusion that there is nothing about capitalism or socialism that necessarily implies a democratic or undemocratic government. In the end Mr. Schumpeter comes out in favor of democracy, though his version of democracy is a bit more elitist than a lot of us might like. At this point, I thought that I began to see where to put Mr. Schumpeter on the political spectrum - he's a realist; he's interested in how political and economic systems can and do work in the real world. He doesn't try to jam facts into a theoretical framework whether it is a framework of the left of the right. Instead, he examines how things really work and thinks about how theories need to be adjusted to accommodate reality. I liked that about him.

[E. G. · Rating 4 out of 5]

Introduction

--Capitalism, Socialism and Democracy

Prefaces and Comments on Later Developments:
Preface to the First Edition, 1942
Preface to the Second Edition, 1946
Preface to the Third Edition, 1949
The March into Socialism

Notes
Index

[Jim Puskas · Rating 2 out of 5]

Schumpeter is best remembered for having coined the term "creative destruction" a process well understood today whereby entire industries and the jobs that go with them are continually rendered obsolete as new products, new technologies, new ways to make money emerge. Schumpeter speculates about the possibility of a democratic socialist utopia, but he unconvincingly discounts the reality of human acquisitiveness and the desire for upward mobility. Further, he naïvely discounted the authoritarian nature of the Russian experiment of his day, suggesting that the degree of coercion in the soviet model would be relaxed as conditions improved, which they did not. The book is colored very much by the widespread debate of his day (WW2 era) as to whether capitalism or socialism would prevail. Lost in the titanic struggle between those two competing ideologies is democracy which, as it turns out today, cannot truly survive under either regime. With the benefit of hindsight I'm perhaps being unfair in judging the book on its merits, since Schumpeter could not have foreseen the calamitous outcome of the Soviet "planned economy". Nor could he have foreseen today's dilemma in America where a few billionaires have become so powerful that they are able to subvert the democratic process (ref. "Dark Money" by Jane Meyer). It seems to me that Schumpeter was no democrat. An interesting work from an historical perspective but certainly neither prophetic nor very useful in addressing the issues of our day when democracy has failed to take root in much of the world and is at risk almost everywhere that it has been instituted.

[Dan · Rating 5 out of 5]

Schumpeter was probably the best Marxist - as he truly stayed within the original and wide-ranging project initiated by Marx. In this book, Schumpeter goes back to economics and keeps everything anchored in it. Then there are all the sociological, political, historical, prophetical, educational, and so on implications of this economic fundamentalism. As a true and non-dogmatic follower, Schumpeter dismisses Marx in several important respects, while retaining and developing him further in others. Fundamentally and like Marx, Schumpeter believes that capitalism will inevitably lead to communism/socialism because of its economic dynamics and contradictions. Democracy, mainly a product of capitalism, is also turning against capitalism and towards communism according to Schumpeter. This book is extremely rich in ideas; but the sections about the role of the intellectuals in society, the rationality of capitalism, along with the sections about the dynamism, entrepreneur, and self-adaptation of capitalism are amazing. It is quite depressing to witness that these days Marx is reduced to a critical theory in the literature departments - theory that only moves within the domain of representation and language; but in the end, probably this is the current capitalism defense against Marxism as it reinterprets and neutralizes it in the framework of the impotent and fashionable postmodernism.

[Marks54 · Rating 4 out of 5]

This is a classic of economics and of entrepreneurship that lots of people have read in their undergraduate economics or business classes. It is worth reading to get the full perspective of Schumpeter's view of how the economy works. This is perhaps the most articulate statement on the role of of "creative destruction" and innovation as critical to the success of capitalism. It is also also very cynical of Marxist approaches to economics. Strangely enough, the section on socialism suggests that socialism may be the coming reality for Europe and America, and in this Schumpeter was accurate for Europe and America. This is perhaps that he is writing at a time when free market capitalism had not acquitted itself well and government intervention seemed increasingly worthwhile. This seems at odds with his emphasis on innovation and entrepreneurship and does create somewhat of a tension that is not well resolved in the book. Schumpeter's thinking on innovation and entrepreneurship has fared better over time than his positive views on socialism, although I am still not sure of his real tone.

[Otto Lehto · Rating 3 out of 5]

Schumpeter was a fascinating character, and his essays and books are fascinating to read. They seem to elude easy categorization. This particular book evinces an almost Hegelian dialectical method, whereby socialism and capitalism are seen as two sides of the same modernist coin.

The section on capitalism contains the analysis of "creative destruction", which is justifiably well-known. But that only takes up a few pages, whereas the rest is devoted to a historical analysis of the conditions under which socialism seems to arise as a viable, almost inevitable, successor, to it.

Although a bourgeois economist, out of the three things he covers, capitalism seems to be the least important - at least for the argument he wants to make. And as he allows the market society to take the back seat, he allows the promise of socialism to bear its full weight as the next stage in the evolution.

The sections on socialism rely on a notion of socialism that seems very curious to us today. He seems to think there are no fundamental problems with organizing a society through a central planning board. Partially outdated, partially all over the place, partially just crazy, the book is nonetheless a fascinating read, since Schumpeter is such a unique thinker, even though the book's value as a lasting contribution - outside of the tremendously important notion of "creative destruction" (which seems to have achieved a life of its own) - to the field of economics is dubious.

The chapter on democracy, I should say, contains a brilliant and almost entirely distinct analysis on democracy, which is almost Machiavellian in its exposé of the power-hungry nature of politics. It bears very little immediate relevance for his further argument on the relationship between capitalism and socialism, but it provides very definite proof of the occasional genius of Schumpeter.

At 400 pages, it is too long. There is almost no reason to read the whole book. The gist of his historical argument for the inevitability of the transition from capitalism to socialism can be gained by skimming through a couple of the central chapters. His charitable analysis of the positive potential of centralized socialism as a method of efficient economic management has been completely disproved both theoretically and empirically (which unfortunately makes the middle part of the book almost valueless, aside from its occasionally brilliant observations). The last 100 pages that deal with the history of socialist parties is entirely superfluous (I admit to skipping it). So, I would say the book could be condensed to about a 100-150 pages without losing anything.

As such, I cannot entirely recommend reading the book, unless you are interested in the history of state socialism as a cause célèbre among intellectuals. I would, however, recommend reading the sections on "creative destruction" and his brilliantly caustic (and spot on) analysis of democracy.

[Andrew]

In the wake of the Second World War, Joseph Schumpeter wrote an exceptionally intriguing book that everyone, capitalist or socialist in persuasion, should read, and will probably enjoy reading. Heavily inspired by Marx and especially his theory of history, as much a sociological as an economic text, and broad-ranging in its analysis of the relationship between capital and society, it's a difficult book to pin down, and clearly the product of a remarkable thinker.

The question-- which all prophetic works beg-- is why Schumpeter's vision hasn't come to life. Rather than paving the way for a humane socialism, we have been left with an especially cruel form of neoliberal capitalism.

I'd also like to question his views on the role of intellectuals. And his rather narrow view of what socialism is. But hey, as I said, I sought out Schumpeter more to provoke myself out of the dogmatic slumbers that I periodically feel myself falling into, and he made a more than decent intellectual sparring partner.

[Dylan Paul · Rating 3 out of 5]

Schump being a rationalist among rationalists, his long-term straight-line projections based in a Marx-like economic determinism of his own devising are flawed from the get-go. But that perspective also keeps him dogmatically undogmatic, and he makes sure to constantly acknowledge the relative improbability of his rationally conjured future, his “schema,” like Hari Seldon leaving some room in his calculations for a Mule event. Schump's invested in conjuring this future anyway: capitalism (d)evolving into a central planner's dream of a fine-tuned-by-committee, mechanized economy, evidently inspired by the contemporary illusions of an economic miracle underway in Stalinist Russia. Somewhat alarming, to say the least.

Unlike most technocratic dreamers (Schump isn't a technocratic dreamer, but he is dreaming technocratically), he's quite happy to concede the point that the socialist order can only maintain stability and efficiency by brutal autocracy (whether democratic or not) along with transformation of the citizenry into something equivalent to the New Soviet Man. Under rationalism, he imagines “there is nothing sinister in what [he is] trying to convey,” as these inevitable "cruelties" are “largely attributable to the unripeness of the situation, to the circumstances of the country, and to the quality of its ruling personnel,” giving away the game that, for all his insights into human nature, he does believe in some version of the “malleability of human nature,” a belief he's happy to mock in romantic socialists. But the situation is never ripe enough and there is no personnel rational enough for your subjugation of the citizenry into brainless, soulless cogs to be accomplished without a little torture here and a little genocide there, Schump.

In spite of all this, the central planner's conceit you get from him isn't as frustrating as others', as he doesn't presume to advocate and remains entirely honest about what it would take, allowing any reasonable reader to recoil from the dystopian Babel/Hell he's laid out. Socialists will recoil as well, as Schump lays out the rational advantages of socialism. When everything is subsumed in the State (in that stage, he says, there technically is no State, making sense of the libertarian-sounding rhetoric you'll find in Marx and Lenin), “attempts at paralyzing operations and at setting people against their work will amount to attacking the government.” An efficiency of socialism over capitalism, then, is the comparative lack of labor rights/power. Whoops. The romantics aren't reading Schumpeter, though—no worries for their platform.

As he makes more and more room for subtle alternatives, it's hard to disagree with the basic thesis. The wonders of “creative destruction” that have raised living standards at a ridiculous rate (given the previous millennia of human history), making a mockery of “inequality” and “big business” based grievances for any reasonable observer, also clearly undermine every institution including itself—that's that “destruction” part. While I don't quite follow that logic to Schump's End of History—socialism is undermined by these forces too, it's basically a consumerized fashion statement at this point, like everything else—there's no doubt that “piecemeal socialization” is still making good progress. One simple assertion he makes, reworded and repeated throughout the later chapters, overshadows most of the rest of his large-scale political analysis: “the remedy for unsuccessful socialization which will suggest itself, will be not less but more socialization.” This should be Rule #2 of politics, next to Rule #1 of course: politics is vanity and chasing after the wind. And Schump knows that well enough, just read his analysis of democracy.

In the decades following Capitalism, Socialism, and Democracy, the Reagan Revolution, Thatcherism, liberalizing movements of a similar bent, and their enduring political force (always mutating with the current fashion), while still meager in the face of "piecemeal socialization," is a direct rebuke to Schump's firm belief that bourgeoisie interests were politically dead and buried. The failures of socialization sometimes actually do provoke a reaction the other way. Still, as I'm sure the man would immediately respond, it doesn't change the overwhelming tide; perpetual expansion of the State is only slowed, never halted. Even so, I'll allow myself some amount of hope. “The stock exchange is a poor substitute for the Holy Grail,” to be sure, but capitalist innovation can achieve electoral success with the right rhetorician at hand; Reagan's hard to believe yet noble sentiment, “America’s best days are yet to come. Our proudest moments are yet to be. Our most glorious achievements are just ahead.” But even if capitalism technically endures, the form it takes may just as well prove the Schump thesis, as “capitalism does not merely mean that the housewife may influence production by her choice between peas and beans.” A future of Deng Xiaoping capitalism is not exactly a refutation of a socialist future.

Leaving aside our supposedly socialized fate, the greatest insights of Capitalism, Socialism and Democracy are in the tangential sub-arguments. Innovation (also referred to as Social Darwinism by hacks) is the primary, perpetual driving force of economic progress, apparently an uncommon notion in the age of Lord Keynes, but something you can pull right out of The Communist Manifesto of all places. Marxism is characterized as a religion “which promises paradise on this side of the grave,” and Schump offers all reverence due to the founder of a major world religion while he dismantles it. Assuming motivations is usually poor form, but Schump so beautifully describes the vanity of any and every all-knowing, good-versus-evil (Proletariat versus Bourgeoisie, Real America versus Global Elite, Social Justice versus Fascism, Volkisch versus International Jew) sort of catastrophist activist's “synthesis” that it's worth reproducing several lines:

“Panting with impatience to have their innings, longing to save the world from something or other, disgusted with textbooks of un-describable tedium, dissatisfied emotionally and intellectually, unable to achieve synthesis by their own effort, they find what they crave for in Marx. There it is, the key to all the most intimate secrets, the magic wand that marshals both great events and small. They need no longer feel out of it in the great affairs of life—all at once they see through the pompous marionettes of politics and business who never know what it is all about. And who can blame them, considering the available alternatives.”

Mention of that temptation pairs well with a phenomenon that Schump prophesies all to perfectly: the university graduate who is both overqualified and underqualified in his job market. This ever-increasing supply of “unemployed or unsatisfactorily employed” happens to “swell the host of intellectuals.” Big surprise, “they [they/them pronouns of course] enter it in a thoroughly discontented frame of mind. Discontent breeds resentment,” so on and so forth. This brand of subsidized social unrest is more convincing as to Schump's thesis than any amount of impersonal theorizing; a reader's firsthand evidence does wonders. Then again, the haze of the digital age didn't factor into his calculations, so this new class being relegated to Twitter screeching may cancel out the revolution—burning cities aside.

As Capitalism, Socialism, and Democracy has been my most thought-provoking read since the secondhand Rieff and Taylor I got from The Rise and Triumph of the Modern Self (“In a world of empathy-based ethics, the moral sense is ultimately the aesthetic sense,”) and as Schump's projections are far looser than they first appear, most of my frustration with the over-rationalized central planning “schema” of Part III is canceled out. It's especially forgiven for a likelier alternative he proposes for this ultimate socialist conclusion: “failure not so complete which political psycho-technics could make people believe to be a success.” In a few decades, when the major economic debate may well be between nationalization and socialization (they're synonyms), that doesn't seem unlikely. But trajectories are fake, everything can change in a week, there's nothing new under the sun, and Karl Marx sucks. Thanks for the fascinating read anyway, Schump.

[Eric Baldwin]

It shows how democracy is a vast conspiracy, elections are fraudulent, individual votes are useless, and human nature is corrupt.

[Marcel Santos · Rating 3 out of 5]

The ambitious mission Schumpeter assigned to himself— to write about themes as vast and complex as Capitalism, Socialism and Democracy in a single book — explains the great variation in quality with which such themes are addressed.

The main thesis of the book — that Capitalism has a tendency to destroy itself and that Socialism would have all the conditions to thrive — would not sound that interesting and could even sound rhetorical when compared to the brilliant topic on Capitalism’s inner process of “creative destruction” he so well describes and by which he became so famous. “Would not sound that interesting” because China insists on putting Communism back in the game so many years after the fall of the Soviet Union with perspective of taking over the World’s economy. The author’s thesis though may be read as a heads up for those who wish to understand the processes that can lead to both phenomena, which Schumpeter illustrates with plenty of examples of the History throughout the book.

Some arguments he uses to demonstrate the thesis in a nutshell: Capitalism may be a victim of its own success, reaching a point at which the process of creative destruction and production of wealth cannot go forward; the spreading of better life conditions produced by Capitalism would make people claim for even more equality, opening the space for Socialism; Capitalism is not good at producing intellectual supporters as Socialism is — intellectuals tend to be employed in different activities and make a satisfying living, unlike what happens in socialist or prone-to-socialist countries, as was Russia. My read is that he is ironic: it’s not that he supports Socialism as a superior system, but he is disappointed by the lack of Capitalism supporters. Finally, Democracy is a system characterized by competition for the power.

In fact, as the author himself points out clearly, the process of “creative destruction” was first described in essence by Karl Marx in the Communist Manifesto as follows:

“The bourgeoisie cannot exist without constantly revolutionizing the instruments of production, and thereby the relations of production, and with them the whole relations of society. Conservation of the old modes of production in unaltered forms, was, on the contrary, the first condition of existence for all earlier industrial classes. Constant revolutionizing of production, uninterrupted disturbance of all social conditions, everlasting uncertainty and agitation, distinguish the bourgeois epoch from all earlier ones. All fixed, fast-frozen relations, with their train of ancient and venerable prejudices and opinions, are swept away; all new-formed ones become antiquated before they can ossify. All that is solid melts into air, all that is holy is profaned, and man is at last compelled to face with sober senses his real conditions of life and his relations with his kind”.

Schumpeter developed this concept with mastery in a short chapter which is really clear and engaging, unlike almost all the rest of the book.

Clearly, the book was written when Economics was still more a Philosophy (1942-50), when authors did not have access to massive data as their heirs have today. Economists thus competed on who had better intelectual resources when observing and describing reality, had good insights and proposed clever and ingenious solutions often using complex language and erudition. Economists can now rely much more on numbers, so there is even a tendency for them to strive to be readable by the greater public with the use of simple and direct language. On the other hand, the excess of mathematization we see now has certainly occupied the space of the erudition in language of that time with regards to keeping the greater public away.

This is a hard read and can be put down easily without resilience or academic obligation due to the extensive variety of issues covered and irregularity in quality in how they are covered. It is not for nothing that the book — and the author — became so famous for one small but very powerful topic in it.

[Tyler · Rating 4 out of 5]

I am finished with this book finally and I think I have read a glimpse into Marx a little more. I have read Marx's Communist Manifesto before, believe it or not, and it was one of the first books on economics I've read. Well that state of mind was very similar to many others in the early 20th century as they read the pamphleteering of various political party interests.

This work discounts some of the more radical notions but retains some of the core tenets of Marxist communism. A thorough look at some of the more finer kinds of socialism is a little wanting, but their history is not. He will simply lump all forms of older socialism like Fourierism into 'Orthodox socialism'. Every shape and kind of socialism is in here, St. Simon, Plato, everyone. You could hardly think of a type of society not mentioned. This is a must read for the political theorist.

As an economist though, I am lukewarm. I think that his analysis of economic conditions is interesting at times, but choppily made. I have just started Morgenstern's book on accuracy in economic investigations, so I am no pro, but I don't think you should ever 'roughly' compute figures while dropping entire numbers off of both sides of the eventual estimate. For instance, if you're going to have a liberal or conservative estimate that's fine, but I can think of at least one time whilst in Part II (where the unbelievably atrocious statistical estimates occur) that he just leaves off entire numbers on both sides, so that the answer is both conservative and liberal... I mean that's just not right, nor is it accurate.

Now to speak of his economic terminology. If he isn't a good quantitative economist, surely he must be a good qualitative one? Wrong. I was first struck with difficulty when he wasn't including 'wages to employees' in his term 'prime cost'. I assumed it was because he hadn't read Keynes yet. I was right. I still think he should have defined that particular term before he used it in the footnote. The issue I have starts at the last chapter, as you can imagine. It seems he finally did his homework and read Keynes' General Theory of Employment, Interest, and Money, and while I did not enjoy many of Keynes' conclusions or his solutions to those conclusions either, I must admit I am at once struck with how he grossly misinterpreted him. At some point in the book, he essentially equates consumption with saving. This would be the same as saying consumption = investment under the Keynesian system because savings and investment are used interchangeably throughout. So either he didn't read the book or just didn't understand it. He also failed to use any of its important concepts like marginality or elasticity and just decided to drone on and on incorrectly about Keynes.

But. That was one chapter. He kept himself within the sphere of history of political science and political philosophy mostly the entire time, so I cannot complain with his ability to deftly explain these concepts in a way which was coeval with some of the greater political scientists like Tocqueville or Burke (the latter of whom is specifically referenced at least three times).

This was a good read overall by what can only be described as an 'Austrian socialist'. A socialist, because he believed in socialism and wasn't a Marxist, and an Austrian, because he didn't understand the quantitative side of economics. 4/5 stars though, because he's a way better read than Hayek.

[mohab samir · Rating 5 out of 5]

الكتاب عبارة عن نقد لثلاثة مفاهيم هى عنوان الكتاب ، والواضح ان المفهومين الأولين هما اقتصاديين واجتماعيين . والأخير سياسى . ويحتاج الكاتب الى بناء أطروحة تتأتى نتائجها من تتبع نسيج الأطروحة ذاته والتى تهدف من خلال نقد هذه (المفاهيم) وتحليلها التحليل الأوسع الى فهم العلاقات المتنوعة القائمة فيما بينها والتى تؤدى الى نتيجة ظاهرة محددة فى حالة تركيبة محددة من العوامل الاقتصادية والاجتماعية والسياسية لدى مجتمع بعينه . 
يبدأ الكاتب بنقد الفكر الماركسى لتوضيع أهميته وإظهار ما ينقصه بسبب ظروف الزمن الذى نشأ فيه أو بسبب التكيف الذاتى من أجل غاية مسبقة ، ويفلح النقد الماركسى كذلك كمقدمة لنقد الرأسمالية لذات الأغراض النقدية ، أى التحليل للكشف عن الماهية ومعرفة عناصرها المكونة وآلية عملها وما لها من ضرورة وما فيها من أوجه قصور تقودها الى التقدم فى الحركة الجدلية التى يبدأ فيها المبدأ ذاته فى النمو من جانب والتآكل بفعل آلية تكوينه بالذات من جانب اخر . وحيث يقوم النقد على التحليل الشامل والأكثر عمقا تتضح العلاقة الجدلية بين الاتجاهين والتى اراد الكاتب توضيحها من خلال هذا التحليل . فتظهر لنا الأفكار الاشتراكية كنتيجة لتطور المجتمع البرجوازى كما تظهر الديمقراطية الكلاسيكية كأداة سياسية صاحبت تطور المجتمع البرجوازى وساعدت على وصوله الى السلطة ، ومن ثم يحاول شومبيتر اظهارة ضرورة تبنى الغالبية الاشتراكية للأداة الديمقراطية التى رأوا كيف كانت فعالة لدى أعدائهم . فما يصبح عليهم الا منهجة افكارهم وترويجها بصورة اكثر عاطفيه لدى الجماهير . ومن هنا نفهم اتجاه ماركس لتأسيس منهجه لصالح جماهير العمال التى رأى ان مصالحها تعاكس بالضرورة مصالح الطبقة الرأسمالية وكيف رسخ بالتالى مفهوم الصراع الطبقى .
ولكن كل هذه الافكار لا تتضح جلية الا من خلال التحليل التالى الذى قدمه الكاتب ليبين المدى الممكن للصحة المنطقية للأفكار الماركسية والتى نكتشف فيها قدرا من الذاتية واللاموضوعية التى لا يستهان بها ، ولكننا نرى مدى تطور الكثير من الافكار الاقتصادية وتطور التحليل التاريخى المبنى عليها لدى ماركس . كما لا ننخدع بشمولية مداها الظاهرى حيث يمتد فهم الظواهر الاقتصادية لديه ليشمل فهم سائر جوانب الحياة البشرية بينما فى الواقع لا تعتمد شتى اركان الحياة البشرية على مجرد الوقائع الاقتصادية وان كانت فى مركزها فى الأعم الأغلب .
ومن خلال نقد الرأسمالية الحديثة نجد الكثير من الايجابيات التى ساعدت الطبقات العمالية - على عكس الادعاءات الماركسية على طول الخط - وغيرها من التطورات الاقتصادية والتكنولوجية الواضحة للقاصى والدانى وان كانت فى صياغة منهجية أكثر وضوحا وترابطا ، كما ساعدت على تعديل الاوضاع السياسية حيث قومت وبشكل مستمر من تقاليدها الديمقراطية التى وسعت باستمرار من الحريات الفردية - وهى مسألة ليست مرتبطة بالديمقراطية بالضرورة كما بين الكاتب - كما ساهمت بشكل أساسى فى ترسيخ الحقوق السياسية للأفراد والجماعات فى حدود استطاعتها التى لا يمكن ان تتعداها طبقا لمنطقها الذاتى ولا يقل أهمية عن ذلك مساهمتها فى تطوير الأعمال الادارية والبيروقراطية .
كما تظهر السلبيات التى كانت مصاحبة للعملية الرأسمالية بالضرورة - كالأزمات المالية والنقدية ودورات الكساد المتلاحقة ، والتنافسية الغير عادلة والمؤدية للإحتكار النسبى - وكل الممارسات السلبية البارزة للنموذج الرأسمالى وكذلك تلك السلبيات العرضية المرتبطة بظروف الزمان والمكان .
ومن ثم يؤكد شومبيتر على ظرفية النظام الرأسمالى ذاته والذى بعد ان يصل لذروة ازدهاره يبدأ فى الاضمحلال وخسارة مركزه الاجتماعى بشكل تدريجى وقد أبرز كيفية تطور هذا المسار طبقا لآلية النظام الرأسمالى ذاته وتبيان مداه الذى سيتجه الى تخطيه وتحطيم نفسه بالضرورة .
وبالتالى ينتقل الكاتب الى ضرورة تطور الاشتراكية كنظام اجتماعى والتى تغذى نفسها باستمرار من كل ما تحلل من الآلة الرأسمالية وتظهر عند ذلك ضرورة تحليل الاتجاهات الاشتراكية المختلفة ومدى عقلانيتها ، وبعد نقض الافكار الفوضوية والثورية والطوباوية الراديكالية لا يبقى الا الاشتراكية القائلة بالتطور التدريجى ( الإصلاحية ) من جانب - على مثال الفابية الانجليزية او المناشفة الروس - والاشتراكية الماركسية ( الشيوعية الماركسية ) التى تهدف اساسا الى تحين الفرصة للاستيلاء على السلطة بطريقة ثورية . ويظهر من خلال التحليل ان الطريقة الاولى هى الأرجح والأكثر منطقية وواقعية .
ومن هنا تظهر العلاقات الممكنة بين الفكر الاشتراكى والديمقراطية حيث هى ممكنة ومستدامة لدى المجتمع الاشتراكى التطورى بينما تكون مجرد فرصة انتهازية للإستيلاء على السلطة لدى الثوريين حيث تختفى بمجرد هذا الوصول وتنقلب الى دكتاتورية كدكتاتورية البروليتاريا لدى الماركسيين او دكتاتورية الحزب كما عند البلاشفة.
وبعد نقد المفهوم الاشتراكى الارثوذوكسى للديمقراطية يقوم الكاتب بنقد الديمقراطية البرجوازية الكلاسيكية ثم الاتجاهات الديمقراطية الليبرالية الحديثة فى زمنه . ومن ثم يقوم بعرض نظريته لما يمكن أن تصير عليه الديمقراطية كتنافسية مستحقة على السلطة وكحكم لطبقة السياسيين بعد الاعتراف بالمهنة السياسية بشكل صريح . ثم يتجه الى منظور واقعى ممكن لاشتراكية ديمقراطية اصلاحية حديثة وبيان الشروط اللازمة لتحققها ونجاحها وماهية العقبات التى يمكن ان تواجهها فى البداية .

ويؤكد الكاتب فى أكثر من موضع على عوامل النجاح الواقعى لاشتراكية ديمقراطية صاعدة و المقومات المطلوبة لدى ذلك المجتمع  كالاتفاق العام على البنية الاساسية للدولة ومؤسساتها ووجود حد ادنى من التطور الصناعى قائم على نضج العملية الرأسمالية وطبقة الرأسماليين . كما أكد على أهمية وكيفية عزل المسائل السياسية عن تلك الاقتصادية التى تتولاها اداراتها الخاصة ، ولا يكون بينهما الا طبقة لا تقل عنهما كفاءة من البيروقراطية الضامنة لاستمرار العمل الادارى والحكومى العام حتى فى ظل غياب حكومة بل والتى لا تتوانى عن تقديم المشورة والنصح والدعم للطبقة السياسية والادارة الاقتصادية المركزية كلٌ بحسب موقعه . ويؤكد الكاتب على ان التطور التدريجى للاشتراكية فى هذا الاتجاه من استقلال المؤسسات ودعم زيادة الكفاءة مع التأكيد على الدور الرقابى هو الاتجاه الاكثر رجحانا لدوام تطور الاشتراكية . وهو ما أثبتته التجارب الانجليزية والألمانية والإسكندنافية على وجه الخصوص الى يومنا هذا رغم مرور ٨٠ عاما على صدور هذا الكتاب .
وفى الختام يقوم الكاتب بتحليل التطور التاريخى للعمل الاشتراكى من خلال كبار مفكريه كفورييه وسان سيمون وماكس برودون وفرديناند لاسال وماركس وغيرهم ، والأحزاب والحركات الاشتراكية كالحزب الديمقراطى الاجتماعى الالمانى والحركة الشارتية والفابية فى انجلترا والتحالفات الأهم كالأممية الأولى والثانية ، وأثرهم الفعلى وعلاقاتهم بالحركات النقابية العمالية .
ثم يتجه الكاتب الى مقارنة نموذجية توضح الفارق الأهم بين الاتجاهات الاشتراكية التى وصلت الى السلطة فى كل من السويد وروسيا ، ففى الاولى توافرت عناصر نجاح الاشتراكية بشكل سلمى التى اكد عليها شومبيتر فى تحليله كالمستوى الثقافى المتقارب لدى مختلف طبقات الشعب وعدم وجود هوة اجتماعية سحيقة بينها وكفاءة الإدارة وتفاعل الاحزاب الاشتراكية مع الوضع الراهن بغية الاصلاح والتقدم التدريجى والمستمر نحو الاشتراكية العامة فى صورة ديمقراطية . بينما فى نموذج الروسى الذى استورد من خلال البلاشفة الانتهازيين افكارا لا تناسب وضع بلادهم الاجتماعى والسياسى والثقافى وعملوا على تهييج الجماهير وارضاعهم افكارهم بشكل عاطفى وسطحى بحيث كانت الديمقراطية مجرد حلقة صغيرة ولكنها ناجعة لتحقيق سيطرتهم الحزبية التامة على البلاد ، حتى ان الديمقراطية فقدت كل وجود لها وحتى داخل الحزب وهو ما عمل فيما تلى على الانهيار التدريجى لهذا النموذج الذى لم يحقق اى نجاحات الا من خلال السلطات الديكتاتورية للحاكم الفرد وأجهزته القمعية . وفى خلال ذلك العرض التاريخى يتضح مدى التوافق بين نظرية شومبيتر لدى تطبيقها على النموذج الروسى وما قام تروتسكى بسرده عن تاريخ الثورة الروسية والظروف التاريخية العرضية التى قادت البلاشفة الى السلطة والذى اعترف فى عدة بمواضع بإمكان احداث اخرى لم تكن لتسهم فى ذلك وان اكبر عناصر نجاحهم اعتمدت على بلادة القيصر وحاشيته ثم قصر نظر حكومة الثورة البرجوازية التى ترأسها كرنسكى . كما أظهر تحليل شومبيتر بوضوح مدى إبتعاد فكر لينين عن التعاليم الماركسية الأكثر أساسية .
وعندما ينتقل بنا الكاتب الى العلاقات السوفييتية بالشيوعيين فى الاقطار الأوروبية الغربية وتحليل السياسات الستالينية الى نهاية الحرب العالمية الثانية يدرك القارئ كون هذه السياسات مفصولة تماما عن المبادئ الإشتراكية والديمقراطية على حد سواء وانها كما استغلت الفكرة الديمقراطية للوصول للسلطة فانها تعاملت مع الاشتراكية بنفس الانتهازية والتى حلمت بأن تأخذها الى قيادة الثورة العمالية العالمية وزيادة نفوذها الإمبريالى على القارة .ولو لم يعترف الكاتب بذلك صراحة الا انه ترك مهمة إيضاح ذلك للتحليل الشامل الذى قام بعرضه . وهذا هو عموما نهج شومبيتر فى ذلك الكتاب الذى أعلن صراحة أن غرضه هو تنشيط الفكر السياسى والاجتماعى لدى القارئ - الذى يساعده على قراءة الأحداث - لا توجيهه الى نتائج وغايات سياسية واجتماعية معينة تاركا مهمة الاستنتاج والقياس النهائى لدقة التحليل وإنتباه القارئ . 

[کافه ادبیات · Rating 3 out of 5]

کتاب کاپیتالیسم، سوسیالیسم و دموکراسی، اثر جوزف شومپیتر، اقتصاددان بزرگ قرن بیستم، در پی ارائه نگاهی تازه به مفاهیمی همچون ظهور و سقوط سرمایه‌داری، بازنگری در تعریف دموکراسی و سوسیالیسم است .
نویسنده در این کتاب، ابتدا نگاهی به آراء و نظرات کارل مارکس متفکر شهیر آلمانی دارد و نظرات او در خصوص نظام سرمایه‌داری را بررسی و نقد می‌کند. سپس در ادامه به نگاهی به نظام‌های سرمایه‌داری دارد و برخی از مهم‌ترین و بهترین ویژگی‌های نظام سرمایه‌داری را شرح می‌دهد و به اصطلاحات مهمی همچون «تخریب سازنده» در خصوص حیات نظام سرمایه‌داری اشاره می‌کند.

در نهایت، به چگونگی افول سرمایه‌داری، لزوم بازنگری در تعریف دموکراسی و ارائه تعریفی جدید از آن می‌پردازد و با ذکر دلایل خود، چنین استدلال می‌کند که نظام سوسیالیسم می‌تواند با دموکراسی همخوانی داشته باشد.

[Patrick · Rating 2 out of 5]

Schumpeter lived a very, well, Schumpeterian lifestyle, battered up and down and around the world by the winds of economic turmoil. He argues that this undulating dynamism is in fact the defining attribute of capitalism and the reason it has been so undeniably successful at achieving economic growth. Unlike most economists he defends capitalism warts-and-all: He fully recognizes that we have never lived in anything like a perfectly-competitive efficient market, and goes on to say that we wouldn't even want to in the first place. He explicitly defends monopoly and speculation, and honestly makes a surprisingly good case.

Where he begins to lose me is in his defense of depressions; he seems to think that a depression is a necessary corrective for the excesses of the boom, an attitude that Krugman aptly dubbed "sado-monetarism". No, a depression is a mistake, an error that can be corrected relatively easily by sound policy.

And then near the end of the book he goes completely off the deep end, going on a long rant about how it is "obvious" that rich people are superior beings and anyone who would doubt this is foolish or evil. (To be fair, he would never have met Paris Hilton or Donald Trump.) In his long discussion of socialism he actually he seems to think that the tyranny of Mao and Stalin were essential—even laudable—because there is simply no other way of keeping the masses in line. It was so sickening I had to simply give up on the book at that point.

[Stevenglinert · Rating 5 out of 5]

Schumpeter must have been a really shitty human being to hang out with. And his dating profile must have been intolerable to even read. Schumpeter does a better take-down of socialism and Marx than Hayek or Von Mises, but never gets into any libertarian sounding nonsense and his shtick about capitalism is the best pitch I've heard for it in awhile. Also for a book about economics, it's written in like, the most bitchy tone.

[Nicole Scavino · Rating 5 out of 5]

¿Puede sobrevivir el capitalismo? No, no creo que pueda. _

En síntesis, mi cita de frase textual impregnada, con la que me quedo.

[Whitlaw Tanyanyiwa Mugwiji · Rating 4 out of 5]

It is a great read, especially for those interested in the political economy. It is Schumpeter’s best book, which is famous for popularising his acclaimed theory on capitalism, "creative destruction". Definitely not a light read, it took me forever to finish. But it was worth the read. I must confess, it is a difficult read even for those with an economics background, or those who have read Hegel’s dialectics or Karl Marx’s interpretation of history through dialectic materialism, as these theories or their interpretation features quite a lot.

By and large Schumpeter agrees with Karl Marx that socialism will ultimately follow after capitalism but they differ fundamentally on how that will come about. Karl Marx believed that socialism would come at the behest of the proletariat through revolutions, whereas Schumpeter believes that capitalism by its very nature of creative destruction, it will cause its own destruction.

[Amy Ma · Rating 4 out of 5]

Yet another socialist who makes a stellar case against capitalism yet fails to provide a remotely convincing alternative. I oscillated between thinking Schumpeter was cooking and thinking he is a conservative, elitist, racist bum. It’s hard to disagree with his underlying theses — the decay of perfect competition, the mechanism of creative destruction, the impossibility of democracy in liberal society. He combines Marx, Walras, and Hayek in an elegant centrist-right unicorn poop. Very smart man, rigorous (albeit overwhelmingly qualitative) analysis, and most certainly a very enlightening read. Is he a wacko? Probably.

[Ryan · Rating 4 out of 5]

Language made me want to scrape my eyes out x

[Todd · Rating 5 out of 5]

Joseph Schumpeter gives a penetrating, critical review of both capitalism and socialism. I daresay he provides the most useful analysis of Karl Marx, Marxism, and Marxists I have ever read. His grasp of economic realities gives the lie to Friedrich Hayek’s claim that “If socialists understood economics they wouldn’t be socialists,” because, in fact, Schumpeter considered himself an “orthodox socialist” (as opposed to a communist or any other sort). What astounded me was that, in spite of his clear-eyed perception of the realities of both systems and his own rigorous analysis in terms of what could be expected of them, that he proceeded to conclude, in good orthodox socialist manner, the inevitability of not only the collapse of capitalism, but its transformation into socialism. The collapse of capitalism he makes a good case for, and has ample empirical historical evidence from which to draw, but the inability for socialism to actually take its place for more than a brief transition period he both foresaw and overlooked.
Schumpeter notes that “capitalism is being killed by its achievements.” (location 168) In this, he need not look further than the harbinger of modern liberalism, Holland. It briefly rose to power and wealth through the application of a more liberal system than had been seen up to that point or employed by its contemporary peers. But those who gained under the system of relative freedom sought to protect those gains from the vagaries of such a system and quickly fettered the goose laying the golden eggs. In many respects, more modern capitalist countries have been doing the same thing in slower motion, through adopting socialist principles or opting for a “mixed” system, the welfare state.
So why shouldn’t socialism be expected to replace capitalism? Schumpeter correctly understood that the “true psychology of the workman…centers in the wish to become a small bourgeois and to be helped to that status by political force.” (location 259) In the small addendum Schumpeter wrote after World War II, he even expressed the fear that American laborers would be so well off as to supersede the need to turn to socialism. Fast forward to my own childhood, growing up among men who worked at General Motors in Detroit—they owned their own homes, perhaps modest, but not bad, typically had two cars, and at least one of them was usually a Suburban, had a boat for fishing and/or skiing, and often had a cabin “up north” (in northern Michigan) to which they could vacation, summer and winter. Marx would not have recognized these people or the lives they lived as proletariat. They were bourgeois through and through.
For all his excellence in economic analysis, Schumpeter seems to adopt a few small errors. First, he seems to uncritically accept the notion of economies of scale, pretty much without limit. Therefore, he saw capitalism as inevitably producing ever larger factories owned by ever larger companies with ever more capital, etc. Yes his own conclusion about the creative destruction associated with capitalism, the fact that capitalism is never static, should have warned him off the idea that stodgy oversized publicly-traded corporations would crowd out the innovators and entrepreneurs. On that last point, Schumpeter overestimated the tendency for capitalism to answer all needs and wants so exactly as to squeeze out new ideas, not to mention reach a standard of living that was “enough” and that people would be disincentivized from seeking more than that. So while capitalism still contained seeds aplenty for its own destruction, Mark Zuckerberg, Jeff Bezos, Bill Gates, Steve Jobs and many others are testament that innovation would not cease and people would not stop seeking to become ever more prosperous.
While Schumpeter’s analysis of capitalism and socialism is clear-eyed and hard-nosed, his analysis of democracy comes off as disingenuous at best. By focusing on the “democracy” (representative government) part of it alone and divorcing it from the larger liberal system (one of negative individual rights), he has a field day criticizing it and its proponents. But America’s founders, for instance, did not set about founding “democracy” as such in and of itself. They were more concerned with defending their individual rights, maintaining a system of liberty, than any particular government form, evidenced by their wide disagreements as to that final form and adopting the Articles of Confederation prior to reassembling and putting together today’s Constitution.
His grossest straw man with respect to democracy is that there is an agreed-upon Common Good that democracy is used to obtain. In fact, representative government accepts the inability of people to agree even upon this, but provides a peaceful means for disagreements about this to be aired and for at least provisional solutions to be tried. It is socialism that presumes much more as to the obvious nature of the Common Good and the ability for one or a few to impose it upon the many.
Schumpeter’s confidence that socialism is compatible with democracy is questionable at best. When the ruling clique controls the airwaves, the press, the internet, all the public space to demonstrate or assemble in, etc., how can any loyal opposition ever hope to prevail? Furthermore, the ruling clique is responsible for employing everyone and allocating necessary resources. A person who risked losing her job in a place with only one employer risks a lot indeed.
His more useful contribution to the understanding of the political situation with capitalism is the fact that the main drivers and beneficiaries of capitalism are skeptical of government and government intervention. They are not themselves the charismatic, swashbuckling sorts to lead the masses or influence public opinion in bold strokes. Therefore, capitalism grew up comfortably in the ashes of the old system, with enough of a skeleton left of the old guard to do the necessary ruling, while permitting the businesspeople the latitude to cause the explosive growth of food supply, industrial production, consumer goods, scientific discoveries, the expansion of human knowledge, etc. Once that old guard expired, those from the capitalist set were unfit or uninterested in taking up their own protection, and they found themselves in a world full of would-be rulers who fully intended on the destruction of the capitalist order. Hence the political problem. Schumpeter does not really consider the possibility of establishing a sufficiently liberal system with a large enough body of adherents that it could survive through representative government, etc. Given the rise of Stalin, Hitler, and Mussolini around the time Schumpeter was writing this, perhaps one cannot blame him.
As to the transition to socialism. Schumpeter saw the devolution from free market capitalism to fettered big business capitalism as inevitable, which is unsurprising given his unquestioning faith in the economies of scale. Inevitable or not, it certainly described the historical context in most capitalist countries. Schumpeter mocks the executives of such big businesses as being little more effective than government bureaucrats. Then he turns around and, with a straight face, assures the reader how socialist bureaucrats will be so much better than any of those businessmen who were almost as bad as they were… In his post-WWII addendum, he admits the most atrocious mismanagement in the United States comes not from the fettered big business sector, but government. (see location 8462) But at least dissent will quiet, once everyone is socialist, all those socialist agitators will go away, and there will be nobody making everybody unhappy with the current situation. Except that Schumpeter allows that socialists don’t agree with one another and, in fact, for many socialists, they don’t care about the ideas or practices so much as whether or not they are personally in charge:

the individual socialist looks upon the advent of socialism, naively but naturally, as synonymous with his advent to power…in conversing with militant socialists I have often felt some doubt as to whether some or even most of them would care for a socialist regime, however perfect in other respects, if it were to be run by other people. (location 4534)

So how is it we’re to expect a lack of discontent, after all…?
Schumpeter breaks from communists and more radical socialists in expecting most of the transition from capitalism to socialism to be almost a non-event, vice violent revolution. He used especially post-World War I England as his chief example, and followed up in his post-WWII note to say that all was proceeding exactly as he had foreseen. And so England continued until it had practically devolved into a third world country in the 1970s, at which point it did a radical jump back toward liberalism, even taking the Labour Party with it, in terms of the evolution of “New Labour.”
Which focuses on the real problem of socialism actually replacing capitalism. As Schumpeter and so many others, proponents and opponents alike, have pointed out ad nauseum, the vast expansion in population and production since circa 1800 onward was the product of capitalism. No other system yet tried has even come marginally close. Schumpeter did not have the advantage of 1990 to see the collapse of socialism globally, nor to look back from that vantage to see how badly served those formerly socialist populations had been between WWII and the final collapse. As Isabel Paterson correctly noted, those socialist systems only went on that long based on the surpluses produced by the capitalist countries, often in direct aid as “credits” or similar support, shocking considering the lethal confrontation of the Cold War. Should there be a large movement away from capitalism, one can only expect starvation, privation, and want, as any replacement would be unable to maintain the present standard of life, much less continue to push back the boundaries. I would forecast a return to tribalism and systems far less organized and artificial as either capitalism or socialism. See Jonah Goldberg’s Suicide of the West: How the Rebirth of Tribalism, Populism, Nationalism, and Identity Politics Is Destroying American Democracy for a much more compelling alternative to Schumpeter’s (by-now) quaint-looking one.
After all, the collapse of socialism did not spell The End of History and the Last Man. Schumpeter in his own time noted that “As regards economic performance, it does not follow that men are ‘happier’ or even ‘better off’ in the industrial society of today than they were in a medieval manor or village.” (location 2927) Rutger Bregman develops this same idea with some acuity in his Utopia for Realists: How We Can Build the Ideal World: “To the good life, where almost everyone is rich, safe, and healthy. Where there’s only one thing we lack: a reason to get out of bed in the morning” (location p 10) and, “But the real crisis of our times, of my generation, is not that we don’t have it good, or even that we might be worse off later on. No, the real crisis is that we can’t come up with anything better.” (p 11) The decomposition of bourgeois family and values that Schumpeter perceived, apart from the contentment with a fixed standard of life (how could a man who brought us creative destruction really fall for this?!), certainly has come about in many ways, although not evenly: “the bourgeois order no longer makes any sense to the bourgeoisie itself.” (location 3635)
Which raises the question of how did a person of Schumpeter’s perception and intelligence, whose own analytic constructs correctly highlighted the problems, contradictions, and fallacies of socialism itself, not see the inability of socialism to replace capitalism long-term? For one, he appears to have accepted a good deal of Soviet propaganda uncritically. He vastly overestimated the ability of a handful of “experts” to rationally order an entire economy. He also reduced the running of “socialism” to be almost indistinguishable from the fettered big business capitalism he saw it replacing. He turned a tin ear toward the atrocities, at least some of which he was aware of, that came part-and-parcel with socialism. For instance, “The cruelties to individuals and whole groups are largely attributable to the unripeness of the situation,” (location 4787) “A strike would be mutiny,” (location 4737) and “threat of dismissal by the socialist management may mean the threat of withholding sustenance that cannot be secured by an alternative employment.” (location 4729) Or how about, “the really terrible point about the Stalin regime is not what it did to millions of victims but the fact that it had to do it if it wished to survive. In other words, those principles and that practice are inseparable.” (location 8261) How could he really believe that “the socialist order presumably will command that moral allegiance which is being increasingly refused to capitalism”? (location 4656)
Schumpeter accidentally stumbles into something when he muses that the future socialism “is much more likely to present fascist features.” (location 8209) In fact, it was the increasing intervention of government in terms of legislation, regulation, and taxation, without the overt abolition of private property, ala fascism’s corporatism, that led to the rise and sustainment of fettered big business capitalism. And Schumpeter’s rationalized socialism looked little different from that reality. It seems far more likely that people around the world would embrace the comfort of socialist promises without having to (openly) pay the price of losing their cherished private property, even should the very term “private property” be rendered nearly meaningless through ever-increasing government control.
Really the only suggestion I have is to read Jacques Ellul Propaganda: The Formation of Men's Attitudes for an understanding of how a person of Schumpeter’s abilities continued to swallow the socialist historical inevitability bit in spite of himself.
There are a handful of people, no matter how often you see them referenced, or how many summaries or critiques of their works by others you may have read, that you still need to go back and read them in their own words. Schumpeter is clearly one of these. His examination of both capitalism and socialism is as penetrating as it is provocative. Even when you don’t find yourself agreeing with everything he says, he will have your mental juices flowing and will inspire no end of your own thoughts. He gets a little technical here and there, but in the main, it is very readable. For all of its flaws, it really is a must-read.

[Pavelas · Rating 4 out of 5]

Schumpeteris praeito šimtmečio 4-ame dešimtmetyje prognozavo kapitalizmo žlugimą ir socializmo įsiviešpatavimą. Tiesa, anot jo, tai turėtų įvykti ne kruvinos revoliucijos keliu, o nuosekliais nedideliais žingsniais, kuriuos žengdami pamažu artėtume prie naujos santvarkos.

Po Sovietų Sąjungos fiasko daugelis nurašė Schumpeterio pranašystes kaip nepagrįstas, bet žvelgdamas iš dabarties perspektyvų, taip griežtai jo įžvalgų neatmesčiau.

Schumpeteris sakė, kad verslas nuolat stambės, ir tas stambėjimas nėra blogas reiškinys, nes stambusis verslas gali skirti daugiau išteklių investicijoms į mokslinius tyrimus ir naujų prekių kūrimą. Naujos prekės naikina senas rinkas ir kuria naujas, šį procesą Schumpeteris vadina kūrybine destrukcija (creative destruction). Pagalvokite, kaip pavežėjai naikina klasikinį taksi verslą ir turėsite labai šviežią kūrybinės destrukcijos pavyzdį.

Visus mūsų poreikius (ypač karantino laikotarpiu) tenkina vos kelios kompanijos - google, fb, amazon (siūlydamas, tarp kitko, ir goodreads), netflix ir dar gal viena kita. Kiekviena iš šių kompanijų savo rinkoje konkurentų beveik neturi, o vartotojams irgi patinka turėti vieną patikimą tiekėją, kuris vis tobulina paslaugą ir neverčia nuolat ieškoti alternatyvų. O pagalvokime - jei jie visi susilietų į vieną kompaniją - gal būtų dar patogiau, viskas efektyvumo vardan? Tik paskui reikia, aišku prižiūrėti, kad nepažeistų mūsų asmens duomenų ir kitų teisių, kad neužkeltų kainų iki nepriimtino lygio. Tam tikslui pajungiam valstybę. Na, ir toliau jau suprantame, kad čia toks stumdymasis tarp tos megakompanijos ir valstybės tik kainuoja daug išteklių, todėl apjungiam viską į vieną. Ir gauname Schumpeterio socializmą.

Fainai tikrai neskamba, bet gali būti, kad tokia yra natūrali istorinė raida. Kažkada feodalizmą pakeitė kapitalizmas, tad tikrai įmanoma, kad ir kapitalizmas užleis kam nors vietą.

Atskiro dėmesio verta Schumpeterio “intelektualų” teorija. Schumpeteris sako, kad dabartinė sistema kuria aukštąjį mokslą turinčių žmonių perteklių. Tačiau mažiau gabūs intelektualai negauna normalaus darbo, nes tų intelektualų tiesiog per daug. Tada tie intelektualai tampa nepatenkinti esma sistema, ją kritikuoja ir bando pakirsti rašydami laikraščiuose (Schumpeterio laikais). Mūsų laikais intelektualu tapti dar papraščiau - demokratinis fb viską spausdina.

Bet Schumpeteris neapsiribojo tik distopinėm pranašystėm, knygoje yra ir kur kas žemiškesnių dalykų. Pavyzdžiui, pasak Schumpeterio, visuotinė racionalizacija kapitaizmo laikais potencialius tėvus ir motinas verčia išsikelti tokį klausimą:
“Ar turiu atsisakyti savo ambicijų ir skurdinti savo gyvenimą, kad po to senatvėje būčiau įžeidinėjamas ir niekinasmas?”

[Isaac Chan · Rating 2 out of 5]

Although Schumpeter's finest work remains to this day as a work which no sane economist can afford to be unacquainted with, my initial hype for studying it diminished nearly as spectacularly as marginal utility while poring through the pages.

Schumpeter has laid out several prophecies that have proven to be severely wrong. He somewhat naively attempts to compare his might in the economics profession to the likes of Marx, and his grand vision for the downfall of capitalism (while similar in ends with Marx, but fundamentally different in terms of structure and process), is absolutely absurd. Of course, his ideas that capitalism will fall not due to its failure, but due to its success, are reasonable, but to assume that we will eventually march into socialism is to big of a guess.

Schumpeter made quite a number of wild guesses indeed. His vision that entrepreneurs will one day find themselves as a ruler over a barren world, long ago outstripped by technological advancement, is totally incompatible with how events eventually turned out. Right now, capitalism is indeed the top choice for a sovereign state, and many countries, let alone the mighty United States of America, are tripping over themselves trying to refine and improve their capitalism, let alone march to socialism.

Schumpeter's stance reminds me of what Keynes himself stated in his famous "Economic possibilities for our grandchildren". It is interesting, albeit not academically, how economists of that age have looked at their infrastructure and drawn predictions of how one day capital may render labour redundant. It is also a thrill to see in person how the master Schumpeter himself phrased that famous term - creative destruction - in his magnum opus.

However, although it is very fortunate that Schumpeter's predictions have not manifested themselves, we as intellectual men should never let our guard down. There is still a lot to be done. Our capitalism has not reached its true potential, severely hindered by the joined forces of structural inefficiencies, inequalities and corruption. It is time to reform our capitalism, unleash the power of the market, and prove Schumpeter wrong once and for all.

[Garth · Rating 2 out of 5]

Wow. This guy was broken.Schumpeter never intended to offer a landmark definition of democracy. It was an accident of fortune. In the preface to the first edition he admits, “The problem of democracy forced its way into the place it now occupies in this volume because it proved impossible to state my views on the relation between the socialist order of society and the democratic method of government without a rather extensive analysis of the latter.” Indeed, he found himself challenging the foundations which underpin what he described as the Classical Theory of Democracy. But like his ideas about capitalism and socialism, his ideas about democracy have been challenged by an evolution in the political order. Nonetheless, it is impossible to have a firm grasp on theories of democracy without the study of what has become known as the Schumpeterian theory of democracy.

Schumpeter deserves credit for redefining democracy as a form of government rather than an ideal of governance. The Classical Theory was largely based on ideas derived from Rousseau’s Social Contract, yet they were shaped and molded over two hundred years of political thought to expand beyond the nebulous “general will” to establish elections as the expression as the will of the people. Schumpeter removes the ideals and reclassifies democracy simply as “that institutional arrangement for arriving at political decisions in which individuals acquire the power to decide by means of a competitive struggle for the people’s vote.” Huntington simplified the definition to “the selection of leaders through competitive elections by the people they govern.”

Participation has become a fundamental aspect of democracy. But Schumpeter diverges from this approach because he allows the commonwealth to define “the people.” The consequences are simply incompatible with the popular notion of democracy today. He allows for “disqualifications on grounds of economic status, religion and sex” which others may not “consider compatible with democracy.” He goes so far as to apologize for the racism which was America’s great challenge to democratization as he explains that “a race-conscious nation may associate fitness with racial considerations.” Ultimately, the composition of the electorate is inconsequential to Schumpeter. A political system can limit its electorate to a small minority and still claim a democratic form of government. Indeed, it is unclear how small the electorate can become before Schumpeter might consider its reclassification into oligarchy, aristocracy or some other form of government. Schumpeter seems to have defined the earliest forms of democratization where less than a single percent of the population had a right to vote as comparable to the fully realized liberal democracies which emerged after World War II.

Over the past thirty years his ideas have faced significant challenges as governments introduced elections which were only nominally competitive. Fareed Zakaria recognized this transition in his article “The Rise of Illiberal Democracy” but it was the seminal work of Levitsky and Way which gave a name to competitive authoritarianism. Their research effectively destroyed the foundations of the Schumpeterian definition of democracy. The mere presence of competitive elections was no longer an indication of democratic governance. Even a competitive election may establish rules which become neither free nor fair for the political opposition. Indeed, it is the emphasis on competition within elections which has ultimately undermined the electoral process in so many countries. Incumbents are encouraged to enact laws and procedures aimed to favor their own political faction. Over time the rules which undermine democracy can become the norms of elections. And the political process may descend from a competitive form of authoritarianism into a less subtle form referred to as hegemonic authoritarianism.

The book Capitalism, Socialism and Democracy is primarily about the sustainability or rather the inevitability of the socialism. He saw the ultimate success of capitalism as the cause of its own destruction. There is a parallel between his idea of the creative destruction of companies and a different sort of creative destruction of the economic order. According to Schumpeter, capitalist economies encouraged the development of monopolies which became vulnerable as new technologies emerged to threaten their economic model. In the same manner, he envisioned the success of the capitalistic system to bring about its own destruction through its natural dominance over the economic system. The bureaucratization of business was a part of the natural evolution. It eased the transition toward its incorporation as a public bureaucracy under the auspices of a democratic government. He was unable to distinguish between the professional class of managers in business and the professional bureaucrats which managed the government. Ultimately, his economic predictions were quite wrong.

But I bring up his concept of creative destruction because it is never completely applied to democracy. No this is not completely true. He just simply does not care. He acknowledges “whenever these principles are called in question and issues arise that rend a nation into two hostile camps, democracy works at a disadvantage. And it may cease to work at all as soon as interests and ideals are involved on which people refuse to compromise.” He recognized how a growth in polarization allows the competitive nature of elections to undermine democracy. But he simply acknowledges the necessity of authoritarianism. But he holds out a false hope that “the democratic principle of competitive leadership is merely suspended.” Of course, these suspensions may last decades or generations. His own example of the Roman dictatorship culminated in an imperial era which lasted over four hundred years.

It is impossible to develop mature ideas about democracy without a firm grasp of Schumpeter’s sense of democracy. Huntington was right when he described it as a step forward in the theoretical understanding of democracy. Yet it leaves many aspects of democracy incomplete and is challenged with its own inconsistencies. But every scholar of democratic ideas needs to take enough time to recognize its contributions to the study of democracy and offer a logical response. In many ways, Schumpeter’s notion of democracy has become the perspective of the general public. Horizontal forms of accountability like the courts and the professional bureaucracy have come under attack when they challenge the behavior or decisions of elected officials. It is easy to perceive them as obstacles to a democratic form of government. But their role is meant to intensify the democratic experience through its commitment to the rule of law. The Schumpeter description of democracy overlooks this complex interplay between different institutions. In the end, Schumpeter approaches political institutions as an economist rather than a sociologist. This perspective limits his ability to recognize critical aspects necessary for democratic governance.

[Curtis · Rating 5 out of 5]

Excellent. An Austrian economist I can read and agree with most of the time. One of the best analysts since Weber.

[James Rimmer · Rating 1 out of 5]

One of the dumbest books I’ve ever read. Barely parseable ramblings of a fool.

[GooseReadsBooks · Rating 5 out of 5]

It is interesting that the books that I feel like I struggle the most with are the ones that I tend to find are the most rewarding. Schumpeter's classic definitely has joined the ranks of books that have changed my worldview.

Schumpeter attempts to reject the biases and leanings of ideology to present a case for why socialism might succeed. Interestingly he explains that democracy is not inherently tied to either capitalism or socialism. He explains that a strong democracy provides the opportunity for a peaceful and successful socialist economy.

Schumpeter makes excellent points about Marx, identifying areas where Marx was correct but pointing out some of the flaws in his analysis. In particular Schumpeter draws attention to the fact that under capitalism living standards haven't gotten increasingly bad but instead have been improving.

Schumpeter points out that capitalism isn't the only system that offers incentives for individuals to excel.

I found that my main takeaway point from this book was that it is possible to see different futures and that one prescription for the way things should run isn't necessarily the only option. The past isn't necessarily the vehicle to take us to the future.

This book was hard to follow, not because it is badly written but because it is dealing with complex ideas. It has taken me a year and a half to work my way through it, which should give an indication of the challenge I had in working through it. I'm sure other readers will be quicker but I would warn that this isn't an easy or relaxing read.

[Buck · Rating 4 out of 5]

For someone who criticizes others for being prolix, he sure can ramble. Visionary economic foresight though.

[Managing my virtual footprint · Rating 4 out of 5]

An excellent book, if a bit dense. Every section is filled with interesting ideas that are still relevant today. I particularly enjoyed his analysis of the social changes that capitalism entails, and how they inadvertently corrode the very ideas that support it.

[Faisal Jamal · Rating 4 out of 5]

كتاب مهم كتب بعد الازمة المالية بالعشرينات وقبل (واثناء) الحرب العالمية الثانية