This is Richard Wolff responding to another Ask Prof Wolff Question from our Patreon community.
And this one comes from Vidit. Vidit has always wondered
whether and how you would accumulate personal wealth if you lived in a socialist society. Would
it be like you do in our capitalist societies or would it be different and how would it be done?
Good question, so let me try to respond.
Accumulating personal wealth is usually for most of us
about savings. Putting aside for things we will need or might need in the future and that's where
socialist society would make a big difference. In most socialist societies a great deal of what we
usually save for is provided automatically and freely by the society as a whole to everyone
in it. So, for example, if you look at socialist societies and compare them
to non-socialist societies you get more in the way of a government retirement program,
free education, both at the local and high school level and at the university level.
You get subsidized or free child care. If you have a medical emergency, it's covered by insurance.
If people get divorced, there are societies in which male and female wages and salaries
are more similar than otherwise. So, if you look at most of the things people
put aside for personal savings, put aside for personal asset accumulation, you don't need it
in a socialist society and so in a sense you don't need to do that much of it in a socialist society.
So my guess is you would in fact see most people do a good bit less of it. There's no problem in a
socialist society allowing people who want to save out of their personal income to do so and there
would be savings accounts. Every socialist society I know of has allowed and created the space for
personal safe deposits or savings in a savings bank and so on. Also you might be able to invest
in certain ways in shares of various governmental or private entities. Varying socialist societies
have handled that in different ways and I would expect that would likely continue.
There might be limits on it in order to avoid the inequalities that are typical of capitalism.
But in case some of you are wondering, well, if you can't do it or even if you're not inclined to
do it so much on a personal level in a socialist society, would that make you less secure? Since
the whole point of accumulating personal wealth for most people is to be a bit more secure,
my response to that is to remind everyone that in the end, nothing you do is totally secure. Having
something guaranteed by the society as a whole is probably a surer bet than relying on what you
yourself can do. As an example, part of my family is German, and they lived through the great German
inflation of 1922 and 23. So, our family is full of the stories. For 50 years before that,
our frugal German family accumulated savings in savings accounts and various kinds of personal
wealth. The inflation made all of that useless. The thousands of German deutsche mark that they
had accumulated were enough to buy a quarter pound of butter because the prices had gone crazy.
All that personal savings, all that personal frugality, was undone by a social phenomena.
Over the last year, prices in America have risen at least eight to ten percent. Which means, if you
have been saving money in a personal account of various kinds, you will have lost eight percent to
ten percent of it in one year. If the inflation gets worse as most of us expect it to do,
once again, your personal savings decisions will be undone by social changes over which you have
minimal control. So it's not a question about being safe or not in one situation
or another, the reality is socialist societies give you less need and less motivation
to save on a personal level. In the end it will depend on the social totality how secure
you are and whether in retrospect you needed to accumulate those personal assets on your own.
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