Is Socialism a Failure? – Deconstructing Hannon’s Bizarre Argument

A small business owner in Cuba. (Photo: Jorge Royan, Wikimedia Commons)

By Jim Miles

Recently at the UN Donald Trump described socialism as a system that brought “anguish, devastation and failure.”  Just today Zero Hedge posted a commentary about Dan Hannon “demolishing socialism in 100 seconds.”  I went to Youtube and found what is probably its origination, an Oxford Union debate posted April, 2014.

Trump offered no justifications for his position as it is a well accepted ‘truth’ for the exceptional and indispensable nation of the U.S.  Hannon’s arguments were covered in about 800 seconds yet even superficially did not present anything in the way of a strong logical argument.

The Goodness of Capitalism

Hannon began with a specious argument about Hitler declaring he was a socialist, thus socialism creates fascism.  As with many quotes, this is taken out of context of how Hitler truly felt about socialism and acted in the interests of “the aristocratic army and the nervous bourgeoisie. “

From that bad start Hannon argued about how “every other system” – other than capitalism – used coercive and lethal support to support itself, and when capitalism had to resort to force it did so “discreetly and soberly.”  He continued, arguing that all material improvements arose from capitalism and were thus put to a “socially useful end.”  The other systems involved “a group of people who sat on top and the way to get rich was to suck up to their power.”  He ended this section of his argument that capitalism was “channeled” to help others “under the law in a socially productive way.”

At this point I was waiting for some examples, but they were not yet to come.  Hannon offers no examples perhaps because there are no good examples to support his position.  As the examples come later, I will allow the absurdity of his arguments to stand on their own petard.

The traditional anti-socialist dogma continued.  Hannon argued that “socialist countries are less wealthy than capitalist ones, and less free,” – again without examples – and that socialism “doesn’t provide human advantage, it takes away human dignity.”


Finally, he provides an example: North Korea!  Well oh my gosh, this country had every civic structure carpet bombed, napalmed, accompanied with who knows what experimental chemicals and biological weapons and left without any agricultural resources.  Given that and the ongoing hostility of the capitalist U.S., still at war with North Korea, and it presents a very poor example.

An attempt is made to discredit Marx as Hannon argues that Marx was wrong on two key points: that capitalism would result in more and more unemployment; and government would be by a small group of oligarchs.   I’m not sure what universe Hannon inhabits, but both of these arguments have proven out positively.   Yes, unemployment statistics are pretty good at the moment, but they are also highly manipulated, and if the BLS is to be believed, the U.S. is populated by people mostly employed as bartenders and waiters, while a rather large percentage are simply out of the statistical market.

As for the oligarchs, the results of U.S. meddling in Yeltsin’s capitalist economy, and the huge sums spent in U.S. elections and lobbying efforts certainly gives credit to Marx’s oligarch arguments without discussing the everyday role of corporate power within the military-industrial complex.

It doesn’t get better for Hannon.  He argues that the dishwasher is a result of capitalist “economic progress.”  Perhaps from a promoter’s need for profit that is true, but the actual creation of the dishwasher came from technological progress, not economic progress.  Technology is more a driver of capitalist profit than the other way around.

The same argument is used for cars, and the same rebuttal comes easily: cars are a creation of technology, but yes are used to create large profits for corporate owners (and then think about all the transit systems that were bought up and left to go into insolvency by the car companies, accompanied by declining civic support financially).

The final example is almost laughable in its ridiculousness.  The argument made that a short work week is a result of capitalism is the opposite of its origins.  The short work week was not ‘given’ to the masses, but was fought for through unions, strikes, and long hard demonstrations that eventually forced better working standards including shorter hours.  The Magna Carta was not ‘given’ to the nobles of Britain; it was demanded by the landed barons of the era…and so on down through the history of capitalism.

The modern mantra of “free exchange…and comparative advantage run their course” to provide positive outcomes is used.  Again, there is no such thing as “free exchange” or free trade, and the idea of comparative advantage has been fully refuted by the evidence of how modern markets have operated.

Britain’s Greatest Export

His conclusion draws on two sentiments.  First is his challenge to “find me a functioning socialist country that has delivered more than a free market alternative,” using Cuba and Zimbabwe as his examples.  Secondly, it was Britain that brought capitalism to its “fullest flower and we exported property rights and we exported the rule of law.”

Latter point first: yes, you certainly did export property rights, and in the process destroyed the indigenous civilizations of North America, Australia, and New Zealand, with valiant attempts at doing so in India and South Africa while setting up the future problems with Palestine.   Guns, germs, and a Christian Doctrine of Discovery (right to conquest) helped this along admirably.  As for the rule of law, it was a law that others did not accept, and as with all laws, they are made by the wealthy and powerful for the wealthy and powerful with some bits given to the masses in order to have their acquiescence.  That and finding willing accomplices to their crimes.

But really, Cuba and Zimbabwe as your best case bad examples? Zimbabwe is a presidential republic, using a mixed law system that uses English common law and customary law, and has universal suffrage – not the best-case example for bad socialism, much better for a bad example of exported property rights and rule of law.

As for Cuba, its revolution eliminated the crony capitalists (oligarchs) of the era, and in spite of the ongoing U.S. hostility, embargos and blockades, has done quite well by itself.  Both educational and health statistics are better than for the U.S. in almost all categories, and often by large margins.  After the fall of the Soviet Union, Cuban agriculture had to regroup and has become largely self-sufficient and ecologically strong.

Socialism’s Failure

Two definitions of socialism found on the web are useful for this discussion.

A standard definition is: a political and economic theory of social organization that advocates that the means of production, distribution, and exchange should be owned or regulated by the community as a whole.

A more nuanced definition with inclusion of the democratic element is referred to as democratic socialism, in which extensive state regulation, with limited state ownership, has been employed by democratically elected governments (as in Sweden and Denmark) in the belief that it produces a fair distribution of income without impairing economic growth.

It is interesting to note that Hannon does not equate capitalism with democracy as many others do.  Liberty, yes, property ownership for sure (land ownership being the original main factor in capitalist rentier wealth), but not democracy.  Considering that capitalism’s main tenet is to make wealth, create a profit, and that corporations extend that to make wealth for the owners/shareholders who are protected from certain aspects of the law, then it is most certainly not democratic in nature.   By current practices, many large corporations, especially in the FIRE sector, are well above the law, with the obvious example being the “too big to fail” banks and financial institutions.

As with any system of governance there are different levels and nuances as to what is or is not considered to be socialist.   I am not about to write a discourse about that, but rather take a look at some significant socialist failures.

The big one of course is the Soviet Union.  Rather than a failure of socialism, it collapsed from its inefficiencies but also from a high degree of manipulating by its own oligarchs.  Assisted by the U.S. the now truncated Russia endured a decade of capitalist oligarchy attempting to rob the country of its wealth and to establish western dominance over what remained.    It was socialism’s grandest failure, the defeat of the ‘evil’ empire at the hands of capitalist U.S.A.

Yet as happens with many governments, top level calcification, cronyism, and corruption occupied the top levels, involved also as they were with an aggressive U.S ideology constantly painting the USSR as an aggressive evil state.   It failed in part because it could not overcome its own internal contradictions, never able to truly overcome the various repressive conditions – and external hostility –  that had preceded it and had accompanied its creation.  It had many successes in spite of that: science, technology, education, health services, security of its people.

Other Failures

There have been other failures of course, but for a different reason.  Cuba has already been discussed, and is a rather successful state in spite of the odds it is up against.  Perhaps Guatemala – no, sorry, that was a CIA-military intervention against the democratically elected Arbenz government in 1953 that wanted to redistribute lands owned by United Fruit.  Then how about Chile – sorry again, that was another CIA intervention to oust Allende in favor of Pinochet as the social tendencies worked towards nationalizing their own copper resources.

While we are in Latin America, there has been little in the way of socialist successes.  The emphasis from that concerns the manner in which that has occurred, and most of it is subversive military/CIA activities.  The School of the Americas at Fort Bennington – now ‘closed’ and operating as the Western Hemisphere Institute for Security Cooperation – instructed various militaries and paramilitaries in methods of subversion, torture, infiltration and other means to occupy and destroy any hints of socialist activity under the guise of the communist threat, then the drug war, now combined with the war on terror.  There was no real concern for democracy and human rights as the main interest was subjugation to U.S. corporatism.

The Hidden Fist of the U.S. Military

In short, the failure of socialist states is not because of a natural trait of socialism, but because of a natural trait of capitalism – its reliance on the U.S. military and its proxies, the “hidden fist” of Thomas Friedman eloquence, used to suppress dissent against U.S. supported corporations and any other U.S. supported government or organization under popular threat.  Regardless of whether a state is democratic, oligarchic, autocratic, monarchic or dictatorial, so long as it is supportive for whatever reason of U.S. hegemony, they are not attacked.

Other examples are obvious.

The evil state of Iran – again, another CIA/MI6 operation to oust the democratically elected government of Mossadegh because – here it starts – the nationalization of their own oil to keep their own profits and resources at home – how demonstratively non-capitalist!   Libya had the leading demographic indicators for all of Africa, yet in a Hillary Clinton contrived State Department war, the country was destroyed.  Oil, again, yes; Chinese assistance in the oil fields, yes; wanting to create a pan-African currency based on gold – a definite no-no for the U.S. fiat petrodollar.

The Iraq war was/is illegal under international laws of various sorts.  Once again, as dictatorial as Hussein was, it was his interest in selling oil for euros rather than the petrodollar that probably created the most hostility towards him (that and the Israeli influence).

The list of U.S. capitalist wars is almost endless, originating at home in the Indian and Mexican wars and arguably including the Civil War, through the acquisition of the Spanish empire’s territories, and on into China, Japan, and eventually into the lovely little Vietnam war, the latter a war mainly to prevent the creation of a successful socialist state.  Sure the U.S. ‘lost’ in Vietnam, but the original goal was achieved after smashing the country, and adjacent countries, using the familiar parade of bombing, napalm, chemical and biological warfare, as well as the CIA’s Phoenix program of torture and assassination.

Today that ‘hidden fist’ is not so hidden, and resides on many hundreds of bases in the majority of countries of the world, continuing to occupy German, Japan and South Korea.  The main reason is not communism, nor drugs, nor terror, but to support the power and control of the financial hegemony of the U.S. and its reserve currency.

Yes, socialism has “failed” in many countries, due to the dominating presence of U.S. sponsored military capitalism.

Socialist Resilience

Hannon keeps reiterating his challenge to find a socialist government that benefited the people.  His willful ignorance concerning this is almost stupefying. Apart from recognizing the history of western wars and capitalism, he blissfully ignores those countries that are successful.   Does he not know of Norway, Denmark, Sweden, Finland, France, Italy, Germany all with very highly developed socialist traits or strong elements of socialism included in their institutions?  Is he not aware of his own National Health Services that when remaining public provide much better care than the privatized institutions?  Are Canada’s socialist attributes (free health care, federal pensions, employees’ rights, et al) derived from its capitalist ideas exported from Britain?

As long as the U.S. maintains its military dominance and thus its economic dominance of the world, socialist ideas will be hard pressed to survive.  Socialism however has deep roots in humanity’s desire for peace and cooperation and keeps surfacing as an antidote to the depredations of capitalism.  The resilience of people against repression, against destruction of their environment, their civic infrastructures, rises naturally from the oppression that wants to keep them obedient and docile to capitalism’s desire for ever increasing wealth and power.

Hannon relies on blinders effecting a willful ignorance in his arguments presenting socialism as he does.  If he truly believed his own mantra of non-intervention, he would be aware that his libertarian free trade ‘values’ derive from a contradictory acceptance of military coercion to defeat socialism – a cognitive dissonance that would be very difficult to maintain.

Socialism is far from being a failure.  It has demonstrated many successes, an enduring positive approach to humanity, and will hopefully one day rise above the figurative and potentially actual ruins of capitalism.

– Jim Miles is a Canadian educator and a regular contributor and columnist of opinion pieces and book reviews for The Palestine Chronicle. Miles’ work is also presented globally through other alternative websites and news publications. He contributed this article to

– Jim Miles is a Canadian educator and a regular contributor/columnist of opinion pieces and book reviews to Palestine Chronicles.  His interest in this topic stems originally from an environmental perspective, which encompasses the militarization and economic subjugation of the global community and its commodification by corporate governance and by the American government.

(The Palestine Chronicle is a registered 501(c)3 organization, thus, all donations are tax deductible.)
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