Bryan Caplan  

Orwell and War Socialism

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The Economist blog suggests we give George Orwell a booby prize for his 1941 declaration that World War II proved the superiority of socialism over capitalism:

The first award goes, post-humously, to Mr George Orwell, socialist writer, who penned these lines in 1941's The Lion and the Unicorn:
What this war has demonstrated is that private capitalism—that is, an economic system in which land, factories, mines and transport are owned privately and operated solely for profit—does not work...War, for all its evil, is at any rate an unanswerable test of strength, like a try-your-grip machine. Great strength returns the penny, and there is no way of faking the result.

The Economist blog thinks that the next few years blew Orwell's prediction out of the water:

One can't help but wonder about Mr Orwell's private thoughts when America entered the war and used its chaotic, undirected, profit-driven economic might to lay waste to all Hitler's plans.

Frankly, I'm not so sure Orwell's prediction was crushed by the facts. After all, the U.S. moved swiftly in the direction of socialism during the war, and the out-right Communists of the Soviet Union beat the National Socialists of Germany.

Capitalism is great at creating wealth, but socialism is great at taking wealth from the people who created it and using it for other purposes. If socialist countries take five times the fraction from economies that are one-fourth as rich, they've got military superiority, at least for a while. So it's not surprising that Stalinist Russia could starve millions but still turn back the tide of the German invasion.

The real problem with Orwell's quote is that he seems to be judging economic systems purely by their military strength. Don't wretched living standards, loss of lives, and the end of individual freedom count for anything? Strange indeed from the author of 1984!


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COMMENTS (16 to date)
Zhu Benben writes:

If I remember correctly, 1984 was written in 1948. And your comments and your quote source seems to misunderstood Orwell and the situation of the intellectual tide at that time. It's Orwell and Hayek who turned the tide in favor of socialism. And both did that after WWII. Don't be wrong.

Orwell's observation is not normative but positive. And he's probably right about it. In China and in ancient Rome, we see that, a cultural and economic advanced society could be crushed rather easily and repeatedly by primitive cultural and economics systems if they managed to have much greater military strength and often they do.

America in WWII is not that an obvious counter example. Rather, Britain v. Hitler pretty much supports Orwell. America on the other hand, has a great geographic advantage. It's big. And it's kept quite a distance away. And the modern technology still made it possible that America could join the war in time.

Steve Sailer writes:

War injects competition into socialist systems, so they temporarily perform better than normal. For example, the Soviets, with their regime and lives on the line in 1941, promoted a talented 32-year-old named Dmitri Ustinov to command all war production. No way in peacetime would somebody that young get promoted over all the more senior candidates.

Richard Pointer writes:

Dr. Caplan,

Mancur Olson's Power and Prosperity addresses Soviet Russia's ability to marshal resources for the creation of a military machine.

For all those people that think the USA and Britain won WWII, we were but a blip on the German radar. Hitler knew it when he sent the best of the best against Soviet Russia. As you certainly know, the ignorance tolerated of the true nature of WWII in the West is a true shame. We are just as guilty as Soviet Historians of whitewashing history to suit our goals. Unfortunately, it took me until I saw first hand 9 May in Russia when I was 21 to realize that the true history of WWII was slightly different than I had been taught.

eric writes:

If you handicap the Germans for being 'visitors', their death rate per combatant was well below the Soviets, who used humans as cannon fodder. Winning a battle of Stalingrad via the extreme losses the Soviets suffered is testimony to a dictatorship that considered people the way a cancer patient considers healthy cells--as long as the cancer is defeated, it doesn't matter how many are lost. Hardly evidence of any superiority vis-a-vis capitalism, unless one ignores individual welfare, and instead conflates states with their leaders.

US writes:

As Zhu Benben notes, Orwell got to take a closer look at the less nicer parts of socialism later on.

Let's just brush up on some military history. I find context very important, and in this respect the quote is more a very good example of the way some people thought at the time, than it is a disgraceful remark that needs to be passed judgement upon: In 1941, Germany still seemed pretty much unstoppable - she was yet to experience her first major loss on the battlefield, as Paulus' Sixth Army was not lost until early 1942. England was close to a total economic breakdown due to the u-boat campaign, almost everything was rationed and nobody in their rigth mind would think that GB should initiate a landing in France or elsewhere and defeat Germany on her own turf. The main question was not if Britain could defeat Germany, but if she would even be capable of figthing back a German invasion that lurked in the shadows.

I sincerely doubt USA was on Orwell's mind at all at the time - she had after all kept pretty much out of WW1, and in 41 it didn't look much like she was going to enter the Second as long as Roosevelt was in charge. After all, there had been plenty of obvious opportunities by the time of 1941, the most important being Poland, France & the London-Blitz (+Russia? date of quote?).
Economic aid to England - yes. American troups figthing on European battlefields - doubtfull.

Most people living in advanced societies today would surely agree that judging economic systems purely by their military strenght is just plain wrong. But I very much doubt people felt the same way in 41. Many people like Orwell surely felt that this war was indeed "an unanswerable test of strength" - if the war was lost, all the rest of it didn't really matter all that much. In 1941 socialism looked awfully strong. One also needs to remember that if the quote was before Operation Barbarossa was initiated, the socialist regimes of Germany and Russia were not even opponents of war, they were just two strong nations with war on their mind - but not necessarily against each other. Who were to stand up against such great nations?
In this context I guess many people would think that it wouldn't matter all that much that market economies are indeed "nicer" and "better" places to live, because if these countries lost the war against the countries of socialism - as they seemed to do - then why should one care? Nobody would know about the greatness of liberalism and free markets anyway after socialism had won the wars, as countries inspired by these wonderfull ideals would have proven inferior in the one aspect the most important of all: viability.

Richard Pointer writes:

Eric, you may want to actually know your history before you espouse it. Check out:
http://en.wikipedia.org/wiki/Battle_of_stalingrad

Casualities during that battle were about equal, meaning that the Russians had stopped the bleeding. Richard Overy from Oxford recounts it very well in his Russia's War. Most of Russian losses were early in the war or due to Stalin's rash offensives during advances.

I think the clearest evidence of the Russian war machine's power is the Cold War terror that gripped the United States. The US government knew how strong the Soviets were and they made sure that people were scared to death of them.

K writes:

It would help if commentators looked at the timelines of WW2. Orwell was writing before Germany attacked Russia. At the time Russia was faithfully supplying material to Hitler and living up to their non-agression pact with him.

Orwell himself said Russia would fight only after a direct attack by Germany.

The term 'private capitalism' as he used it meant the democracies of Western Europe. He was right, they had failed against the dictatorships of Hitler, Stalin, Franco, and Mussolini. And there seemed small prospect of a reversal.

We know what happened later. Hitler attacked his greatest asset, Russia. And Japan, his nominal ally, started an unneeded war with the strongest industrial nation on earth, the US.

Why fault Orwell for not knowing what Hitler and Tojo would do to screw up their future?

As to who beat Germany. Britain would have lost without Russia. Russia might, probably would, have lost without Britain. Both might have still lost without the US entry after the Japanese blunder.

Monte writes:

RP writes:

We are just as guilty as Soviet Historians of whitewashing history to suit our goals.

Clarification, please. What do you mean by "the true nature of WWII" as relates to U.S. involvement? In what respect is the U.S. guilty of "white washing" history?

Why do I have this nagging feeling that the answers (assuming there are any) are going to elicit a few groans, similar in magnitude to "Abraham Lincoln was America's Joseph Stalin" or "John Wayne was gay"?

Don writes:

Three comments:

First, in Orwell's defense, the empirical evidence for the economic superiority of markets over planning was not nearly so overwhelming in Orwell's day as it is now. I'm sure you're familiar with the Einstein quote observing the obvious superiority of planning; I have it on my office wall as a daily reminder that smart people can say stupid things when they're out of their field of expertise. Kruschchev pounded his shoe and shouted "We will bury you!" at the UN -- but he didn't mean that he'd bury us with tanks and bombs, but that the superior planned Soviet economy would leave the market-based West far behind. Of course, in hindsight -- not so much, Nicky.

Second, the criticism of Orwell ignores that the US economy in WW2 was centrally planned to a significant extent. Galbraith thought he did very well with rationing and price controls (of course, Galbraith thought he did everything pretty well), but more recent work has estimated the deadweight loss of wartime rationing in the equivalent number of armored divisions not produced; the estimates tend to be large.

Finally, while your point about military strength not being the only metric for evaluation of economic systems is certainly well taken, a case can be made that military strength is the foundational guarantor of all those other nice things like living standards and individual freedom.

Richard Pointer writes:

Monte,

No Groans. To say that Russia actually won WWII is not the same to say I want to live in the Soviet Union. Was the price high? Yes. Was it due to socialism? Perhaps. But the simple fact remains that in the US school children are taught that WWII was about 50-50. When I see bs I call it.

Monte writes:

Richard,

But the simple fact remains that in the US school children are taught that WWII was about 50-50. When I see bs I call it.

If I understand your point to be that the Russians did more to defeat Germany than the U.S., I digress. However, it's clear that the harsh winters, combined with Russia's poor infrastructure, contributed as much to immoblilizing the Wehrmacht as the Red Army. What's more, Hitler chose not to use the full force of his military might against the Soviets, owing to a need for reinforcement on other fronts.

Germany's defeat by Russia had little, if anything, to do with economic superiority gained through socialism.

Michael Sullivan writes:

Monte:

I think Orwell's point, and he was in many respects correct, is that, given the same set of resources and wealth, central authority is more able to build a formidable war machine than markets. The fact that markets create much more wealth and make a place much more pleasant to live is completely moot if they fail to build enough strength to keep from being overrun.

In the long run, we see that freer markets can make you so much wealthier that the authoritarian's advantage in siphoning wealth to make war becomes overwhelmed. But the history of WWII and the Cold War speaks clearly that surviving to see that long run was a close call.

If the US turns into a statist, nationalist war behemoth, we could potentially pose the very same sort of problems for the world that the Soviets and Germans did. China poses a similar potential threat. Fortunately neither of us looks especially likely to get anywhere near that level of aggression in the near term. That said, if I were Iranian or Taiwanese, I might not be able to so blandly keeep from worrying about the nationalist aggression currently in evidence on the grounds that it probably isn't enough to cause a world war.

Daniel Klein writes:

The war economy is captivating to folks on the ground because of "the people's romance," not because it is efficient in any other sense. When the people are engaged in an encompassing effort that they feel to be right, with hope of success, all but a few weirdos are euphoric.

Monte writes:

Michael,

I think Orwell's point, and he was in many respects correct, is that, given the same set of resources and wealth, central authority is more able to build a formidable war machine than markets.

In the short run, perhaps. But mercenary forces have met with considerable success in the past. And as we continue to evolve into a global economy where corporate interests take priority, I foresee free enterprise ultimately building a private army far superior to any in our experience.

How's that for an antithetical Orwellian scenario?

Foolwise writes:

German and Soviet (why don't we say Hitlerite and Russian?) munitions production post-1940 was comparable.

Germany:
1940 $6b
1941 $6b
1942 $8.5
1943 $13.5
1944 $17

Soviet:
1940 $5b
1941 $8.5b
1942 $11.5b
1943 $14b
1944 $16b

Brief points:
1) The astonishing success of the Soviets in not only recovering, but eventually tripling their military production despite huge losses of industrial capacity, manpower, and territory. This was bought at an atrocious human cost, probably beyond what a free country could sustain. But much like the pyramids, the sheer accomplishment inspires awe even as we are disgusted by the contempt for human life and dignity.
2) Soviet and German military production was comparable. Given the USSR's greater population, homefield/winter advantage, and the German 2nd front disadvantage, it is somewhat amazing the Germans had the successes they did and held off the Soviets for as long as they did. I'm tempted to explain this by referencing their superior military organization.

Last but not least, I'd like to point out that Orwell correctly sees that the fascist economies were planned, not free market. Contemporary leftists often think fascism and free markets go hand-in-hand, doubtless due to a desire to conflate one evil with another.

For more digression on this topic, see my blog
http://foolwise.blogspot.com/2006/11/economist-george-orwell-irving-fisher.html

obc writes:

"If the US turns into a statist, nationalist war behemoth, we could potentially pose the very same sort of problems for the world that the Soviets and Germans did."

The American Empire is already a statist, nationalist war behemoth, you deluded fool. And it has been this way for over a half-century since the end of WWII at least.

Last time I checked, America spends more on its military "defense" budget than most of the world combined--including China, Russia, Japan, and Europe!

Moreover, it is America that poses a clear and present threat to the rest of the world.

Apparently, you have been living in some kind of warped Reality TV universe and ignore the fact that America has launched several thinly disguised wars of aggression against Iraq, Afghanistan, Yugoslavia since 1999 alone--never mind America's historical warmongering.

As Dick Cheney has stated, America's global war on terrorism will last generations and not end in our lifetime. In PentagonSpeak, the USA is waging "The Long War."

The American people have dutifully goose-stepped and supported their troops in a nationalist orgy of pro-American chest-beating:

Let's Roll! United We Stand! God Bless Amurika!

Your comments demonstrate that Americans have a unique capacity of deception that would make Orwell himself spin his grave.

All this blather about America's vaunted free enterprise system and free markets is comical propaganda.

America's economy is a Military Keynesian system through and through.

Call it American War Capitalism.

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