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Socialization is a process that begins to take place in capitalism as large-scale manufacturing based on a vertical division of labor displaces "cottage industry" - the small-scale production shops, guilds and family-run businesses that existed in feudal economies. This process transforms the act of production into an increasingly social and collective process involving planning and greater coordination among producers, but appropriation of the social product in the form of private profit continues to be a private affair by investors and owners of the enterprise. Furthermore, exchange of the commodities produced is the private act of a small group of capitalists or an individual owner. As the process of socialization expands, a contradiction between the socialized nature of production and the individual nature of appropriation of the surplus product arises, coinciding with the obsolescence of the functions performed by the capitalists (the private owners).
The socialization and centralization of industry and capital under capitalism lays the foundations for a socialist economy. Socialism entails ownership of the socialized means of production by the workers engaged in the production either in the form of worker ownership or social ownership by all of society. The establishment of social ownership over the means of production resolves the contradiction between social production and private exchange/appropriation under capitalism.
Karl Marx envisioned socialization under socialism as involving an expansion of self-management and workplace democracy in the workplace, in contrast to the rigid hierarchy and bureaucracy that characterizes traditional capitalist enterprises. As workers gain more autonomy, they gain more collective decision-making power and control over their work processes. Socialization of industry is different from nationalization, which can, but usually does not imply the socialization of the workplace; socialization of industry can take place in private or cooperative-owned enterprises. In a capitalist economy, socialization is limited because the socialized enterprise continues to operate in a commodity economy under the capitalist laws of motion. Socialization therefore takes a different form in the capitalist mode of production than in the socialist mode of production.
Misuse of the term
Template:Anarchism sidebar Particularly in the United States, the term "socialization" has been mistakenly used to refer to any state or government-owned industry or service (the proper term for such being either nationalization or Municipalization). It has also been applied to any tax-funded programs, whether privately run or government-run. The term "socialized" is usually used in a pejorative sense, most commonly in reference to publicly funded health care programs (See: socialized medicine).
It is important to note that in economic and Marxist terminology, publicly funded or even state-run, universal healthcare services would not constitute a "socialist" industry because the employees (workers) do not own their means of production and participate in the management of their enterprise. Furthermore, a majority of universal healthcare programs in Western countries are privately owned health and pharmaceutical firms that operate for a profit but receive public subsidies in the form of public insurance plans or tax-financed insurance.[original research?]
- Calculation in kind
- Common ownership
- Commons-based peer production
- Economic planning
- Production for use
- Relations of production
- Socialist calculation debate
- Socialist mode of production
- Socialization (the general sociological definition)
- Socialized medicine
- Social peer-to-peer production
- Workplace democracy
- "the act or process of making socialistic: the socialization of industry." "Socialization" at Dictionary.com
- Otto Neurath's concepts of socialization and economic calculation and his socialist critics. Retrieved July 5, 2010: http://www.chaloupek.eu/work/NeurathFin.pdf
- "Participatory Planning Through Negotiated Coordination" (PDF). Retrieved 2011-10-30.
- The Economics of Feasible Socialism Revisited, by Nove, Alexander. 1991. (P.212-213): "Radoslav Selucky opts for what he calls 'social ownership', with 'means of production managed by those who make use of them', separated from the state...1) State enterprises, centrally controlled and administered, hereinafter referred to as centralized state corporations. 2) Publicly owned (or socially owned) enterprises with full autonomy and a management responsible to the workforce, hereinafter socialized enterprises."
- Capital, Volume 1, by Marx, Karl. From "Chapter 32: Historical Tendency of Capitalist Accumulation": "Self-earned private property, that is based, so to say, on the fusing together of the isolated, independent laboring-individual with the conditions of his labor, is supplanted by capitalistic private property, which rests on exploitation of the nominally free labor of others, i.e., on wage-labor. As soon as this process of transformation has sufficiently decomposed the old society from top to bottom, as soon as the laborers are turned into proletarians, their means of labor into capital, as soon as the capitalist mode of production stands on its own feet, then the further socialization of labor and further transformation of the land and other means of production into socially exploited and, therefore, common means of production, as well as the further expropriation of private proprietors, takes a new form. That which is now to be expropriated is no longer the laborer working for himself, but the capitalist exploiting many laborers."
- Benkler, Yochai (2006). The Wealth of Networks: How Social Production Transforms Markets and Freedom. New Haven, Yale University Press. ISBN 0-300-11056-1.
- Otto Neurath’s Economics in Context, by Nemeth, Elisabeth; Schmitz, Stefan W.; Uebel, Thomas E. 2007.
- Socialism: Utopian and Scientific, by Engels, Friedrich. From "Part III: Historical Materialism": "Capitalist Revolution - transformation of industry, at first be means of simple cooperation and manufacture. Concentration of the means of production, hitherto scattered, into great workshops. As a consequence, their transformation from individual to social means of production — a transformation which does not, on the whole, affect the form of exchange. The old forms of appropriation remain in force. The capitalist appears. In his capacity as owner of the means of production, he also appropriates the products and turns them into commodities. Production has become a social act. Exchange and appropriation continue to be individual acts, the acts of individuals. The social product is appropriated by the individual capitalist. Fundamental contradiction, whence arise all the contradictions in which our present-day society moves, and which modern industry brings to light."
- "Dorland's Medical Dictionary".