From social democracy to liberal socialism: a property rights analysis of the transition in Europe

Two important lessons of all socialist experiments to date are: socialism has repeatedly failed to duplicate the accomplishments of capitalism, and socialism refuses to die. At the turn of 21st century, a new type of socialism, liberal socialism, is growing in Europe. Analysis shows that a major reason for the rise of liberal socialism lies in its success in eroding the two key institutions of capitalism, private property rights and the freedom of exchange. Unlike communism, which used brute force to replace private property rights and free exchange with state ownership and central planning, liberal socialism is spreading the wealth around, creating entitlement programs, supporting labor unions and promoting “fair” trade. The common objective of those and similar policies is to lower the costs of the emergence of liberal socialism by replacing the capitalist culture of independence based on self-responsibility and self-determination in open and competitive markets with the culture of dependence on the state