This updated version of the 2018 book co-written by Leo Panitch, a prominent political science professor at York University who unexpectedly died in late last year, and Sam Gindin, former director of research for the Canadian Auto Workers union, makes for a quick but important read. It analyzes the achievements and–especially–the failures of avowed democratic socialists governing, or hoping to govern, their respective capitalist states. The authors, best known for co-authoring The Making of Global Capitalism (London: Verso Books, 2012), analyze and critique the Greek party Syriza, Jeremy Corbyn’s UK Labour Party, and Bernie Sanders’s Presidential campaigns. The Socialist Challenge Today is not written in a sectarian spirit; while overtly anti-capitalist and decidedly to the left of actually-existing social democracies both yesterday and today, noting that emulating “the glory days of…postwar social democracy is inherently limited by the impossibility of restoring the particular social and economic conditions of those days” and that none of the three subjects under review ever proposed “taking capital away from capital,” (5) they also recognize that given current conditions “giant steps are impossible, yet small steps risk being swallowed into the logic of the system.” (7) Hence the need for socialists to engage in “systematic political education” regarding what is needed to push beyond capitalist society and fight outside of government, not merely inside it, for truly radical reforms that point towards a socialist future.
Panitch and Gindin are glad that twenty-first-century socialism has “finally broken free of the Bolshevik legacy” and the desire to emulate “its specific revolutionary methods.” (3-4) Given the pathetic history of Marxist-Leninist and Trotskyist sects and parties in “the West,” one can understand this. That said, given that the Bolsheviks were able to win most of the Russian working class to their political perspective and were, therefore, able to not merely form a government but actually take power–something that no working-class socialist party has done since–abandoning serious studies of how this was accomplished, such as Alexander Rabinowitch’s The Bolsheviks Come to Power and China Miéville’s October, would be an error. This remains true even if, to use an André Gorz quote from The Socialist Challenge, a mass “armed insurrection” is an “actual impossibility in the [Western] context” (25) and the workers’ councils (soviets) of the early twentieth century proved they could be effective instruments of struggle but not of governance, for various reasons. Lars Lih claims that “the real essence of Bolshevism was inspired and inspiring class leadership” in his 2011 biography of Lenin; presumably Panitch and Gindin agree that we need a socialist movement that incorporates this “essence.”
Panitch and Gindin are glad that twenty-first-century socialism has “finally broken free of the Bolshevik legacy” and the desire to emulate “its specific revolutionary methods.” Given the pathetic history of Marxist-Leninist and Trotskyist sects and parties in “the West,” one can understand this.
Syriza’s governance of Greece, a country saddled with illegitimate debt and in thrall to the International Monetary Fund, Eurogroup, and European Central Bank, was an unmitigated disaster, and Panitch and Gindin are correct about why: the government “failed to escape from familiar social democratic patterns as it distanced itself from party pressures, and seemed incapable of appreciating the need for activating party cadre to develop social capacities to lay the grounds” for not only mitigating the effects of the “memorandum” struck between the party leadership and the “troika” in exchange for an €86bn bailout, but advancing left-wing policies and, over time, undermining memorandum policies. (36-7) They also rightly point out that Greece totally breaking with the European Union “would have entailed economic isolation . . . [leading] to further economic suffering for an unforeseeable period.” (34-5) Their judgment is entirely fair: “insofar as the Syriza government failed the most crucial democratic, let alone revolutionary, test of linking the administration up with popular forces . . . there were all too few on the radical left outside the state who saw this strategy as a priority either.” (42) However, Panitch and Gindin do not suggest a possible “stopgap” that Syriza could have implemented: generating a parallel currency for internal transactions by securitizing future taxes and issuing scrip based on revenue anticipation, as an additional means of payment, as Barry Finger of New Politics suggested in 2015. This “work-around” would have bought the government some time, at least.
Panitch and Gindin praise Jeremy Corbyn’s leadership of the British Labour Party for decisively breaking with the neoliberalism of Tony Blair’s “New Labour.” Though falling short of the radicalism of the proposals made inside the party during the rise of the “Bennite” Labour Left, Corbyn’s platform clearly emphasized, “state actions and legal changes that would require finance and industry to make their activities more “diverse” and “socially useful” to meet the needs of workers, consumers, and communities.” (57) That said, where the platform was most radical, in its calls for expanding the creation of co-ops and workers’ control of enterprises, thereby “legitimately raising the potential transformative contribution of workers’ collective knowledge,” it still underemphasized “how far workers’ actual capacities have been constricted under capitalism.” (59) The authors’ assessment of the Corbyn leadership is similar to that of Syriza’s—it did little, if anything, to decipher how to realize socialist goals “through the development of class, party, and state capacities.” (61) Crucially, its industrial policy had nothing to say about “how the promotion of internationally competitive export enterprises . . . relates to the development of a transformational socialist strategy.” (65) All accurate, but more could have been said about the lack of union militancy during the Corbyn years, Corbyn’s incompetence on the Brexit question (it is a nationalist, right-wing project, despite the delusions of “Left Brexiteers”), his inability to recognize anti-Semitism when he sees it (see the Mear One mural scandal, for example), and the lack of democracy inside the pro-Corbyn group Momentum all contributed to the Conservative electoral victory in 2019.
The most insightful chapters of The Socialist Challenge focus on the Sanders presidential campaign of 2016 and the platforms of Sanders’s later rival, Senator Elizabeth Warren, and his ally Representative Alexandria Ocasio-Cortez, another avowed democratic socialist. Panitch and Gindin realize that even if Sanders’s campaign was ultimately “populist,” its mass support and attention and use of the term “revolution” to mean “the struggle against class inequality . . . represented a major discursive departure in American political life, which can be a resource for further socialist organizing,” though of course Sanders could not make a new politics rooted in working-class struggles and committed to transforming U.S. organized labor emerge “ex nihilo” (69-71). They recognize that Sanders had no choice but to run within a Democratic Party primary, as it was the only way to get media attention and the U.S. electoral system lacks proportional representation. (Just as important, but not mentioned by Panitch and Gindin, is the extraordinary difficulty in the U.S. for “third” parties or even Independents to gain—and keep—ballot access in the first place.) They also recognize the ultimate “impossibility of a political revolution taking place under the auspices of the Democratic Party” (72), a topic of debate taking place within the now 85,000-member strong Democratic Socialists of America, which suddenly grew exponentially in the months after the end of Sanders’s campaign and even more so over the last three years. (A political revolution will not take place under the UK Labour Party’s auspices, either.)
The most insightful chapters of The Socialist Challenge focus on the Sanders presidential campaign of 2016 and the platforms of Sanders’s later rival, Senator Elizabeth Warren, and his ally Representative Alexandria Ocasio-Cortez, another avowed democratic socialist.
Panitch and Gindin also realize that Sanders’s calls for extending worker ownership of firms and expanding workplace democracy are not that much more radical, let alone socialist, than those proposed by Elizabeth Warren’s “Accountable Capitalism Act,” inspired by Germany’s “codetermination.” Despite German firms having worker representatives on corporate boards they have been unable “to overcome the relentless pressures of competitiveness,” (77) and “importing” such plans to the U.S. cannot “substitute” for the country’s lack of a strong, militant union movement, even though worker co-ops could have a role in the transition to socialism if they were to pledge “a portion of their revenues and energies to political education and class organizing.” (83-4) Crucially, extension of worker ownership or governance of firms “must be backed by structural reforms that extend control over capital assets at the point of production through building state planning capacities”—which requires reversing forty years of neoliberal restructuring of state institutions. (88-9) This is a decisive issue for the Green New Deal (GND) promoted by Sanders and Ocasio-Cortez. While U.S. socialists have taken a class-struggle, anti-business position in making the case for the GND, at present “the state lacks the administrative, technical, and fiscal capacities to produce and install the technologies and infrastructures required,” mostly likely ensuring the involvement of private capital in the plan. (94)
Essentially, Panitch and Gindin marry their critique of the GND to one of Modern Monetary Theory (MMT). But one does not have to be a chartalist or agree with all aspects of MMT to recognize that today’s fiat money—state currency not pegged to gold or any other currency or basket of currencies— allows public financing to be detached from the tyranny of bond holders. Socialists can still raise bold (and realistic!) demands, even for a GND, from a U.S. state which, at the national level, can fully fund such demands. It can do so precisely
because it is not revenue constrained and does not need to redistribute demand first from the private sector so that the public sector can spend; it can create that demand ex nihilo. State spending by entities that are fully sovereign with respect to the issuance of currency adds net assets to the economy; it is not a drain. No government policy can prevent capitalist crises—they are not caused by a lack of adequate demand—and yes, progressive taxation is necessary. But it is mainly necessary to establish space for the appropriation of additional capacity to meet social needs and to battle inflationary pressures as they appear.
Panitch and Gindin also realize that Sanders’s calls for extending worker ownership of firms and expanding workplace democracy are not that much more radical, let alone socialist, than those proposed by Elizabeth Warren’s “Accountable Capitalism Act,” inspired by Germany’s “codetermination.”
Additionally, though Panitch and Gindin repeatedly stress the need to transform the state (and “public institutions”), to develop state (as well as class) “capacities,” etc., at no point are specific democratic demands brought up. Transformation requires democratization, of course, and one could easily come up with a democratization platform inspired by Marx’s The Civil War in France: election and recallability of all public officials; public officials to be paid an average skilled workers’ wage; abolition of official secrecy laws and of private rights of copyright and confidentiality; abolition of constitutional guarantees of the rights of private business property and freedom of trade . . . and one could go on. These demands can be raised against all capitalist states and should be part of the platform of all socialist parties. They constitute part of what Panitch and Gindin often and rightly stress: the need for a political strategy “concerned with developing worker and community solidarity, strategic coherence, and socialist commitments reflected in a growing popular self-assurance to push ahead.” (103) They are just as important as, say, a socialist government creating a “public conversion agency” with local conversion councils ensuring civic involvement in implementing ecosocialist policies, as the authors suggest.
Despite these criticisms, The Socialist Challenge is an essential read. It provides “revolutionary realism” in its analyses and is free of naïveté, pessimism, and–especially–replications of revolutionary strategy frozen in amber from the twentieth century. That alone makes it a necessary addition to every socialist’s bookshelf.