A simplified graph of the linear political spectrum.

This graph is wrong. Any version of understanding these ideologies as polar opposites is wrong. Flattening the ideological spectrum to a line assumes there is no potential for reflection between the two. Instead, I urge one to consider the horseshoe theory. Jean-Pierre Faye proposed it in his 2002 book Le Siècle des idéologies, though some version of it had been prevalent in Germany before that. (1) Critics of the horseshoe theory tout the vast ideological differences between the communists and the ardent capitalists, though I disagree. In my opinion, the horseshoe graph is still too simplified, however the idea behind it is not. Both communism and capitalism in their extreme forms exist with relatively little economic competition. In communism, the state owns property and the means of production; in capitalism, property and the means of production are privatized. However both systems, left to their own devices, will eliminate economic competition and result in unitary authoritarianism. By design, with communism the state becomes the de facto power. With capitalism, a plutocracy seizes power. The gap in the horseshoe between the two ends is the difference in ownership of the monopolies which contain the means of production. I am not suggesting that the extremes of both communism and capitalism share similar ideologies. Instead, I am suggesting that for both, the end and the means each get more and more similar the more extreme they get.

A simplified graph of economic horseshoe theory.

Communism is the easy target here. Each adaptation of Marx’s principals on a statewide level has failed. As stated by Marx in The Communist Manifesto, “…the theory of the Communists may be summed up in the single sentence: Abolition of private property.” (2) The abolition of private property is not as easy to realize in practice. All past failures at implementing Marx’s ideas follow a similar course of events: first, the proletariat overthrow the government via violent revolution, then the new proletariat state seizes control of all private property. The redistribution of wealth, however, complicates things. The very nature of redistribution requires that someone in the state arbitrarily make decisions, as though they were handling private property. This paradox only expands within the bureaucracy it is created in. Inevitably, someone at the top must maintain some form of “ultimate” authority in order to ensure that decisions are made efficiently and consistently. Herein lies the creation of the hierarchy which comes to define modern applications of “communism”. It is never communism in the ideal form, as dreamed up by Marx as a government of the proletariat. Instead, it inevitably becomes a government of unitary authority, governing equally over the proletariat, but never governed by them. Dissidents are silenced, and attempts at reform — from the outside or inside — are quelled immediately.

Capitalism is a bit more difficult to define in this theory. Capitalism is strictly an economic theory, whereas communism is equally economic and political. Therefor the flaws in capitalism are usually attributable to whatever political realm it inhabits, as opposed to within capitalism itself. Capitalism is applied to democracies, republics, and authoritarian regimes alike, as seen in both the United States of America’s and China’s standing on the world stage. Though China is ruled internally by the Communist Party of China (CCP), their economic standing with other nations follows the same rules as the U.S., Europe, and other western nations. The potential for capitalism to morph into unitary authoritarianism may be best understood as described by Slavoj Žižek in his debate with Jordan Peterson, “there is a problem with capitalism here for the simple reason that its managers, not because of their evil nature — that’s the logic of capitalism — care to expand self-reproduction and…consequences are simply not part of the game. This is, again, not a moral reproach.” (3) The context of Žižek’s comments in the debate were in relation to capitalism’s inherent indifference to ecological consequences. I think any form of consequences can be applied to this statement with relative accuracy. Growth is paramount to profit, and profit is the main motivator in a capitalist enterprise. This is not inherently problematic; profit is an internal motivator and, when applied universally, allows people to act within their own best interests while simultaneously engaging with the needs of others. However, as enterprises grow, their accumulation of profit allows them the means to manipulate the marketplace to their advantage. Price fixing is a natural byproduct of upscaling. By integrating vertically, an enterprise can dictate not just the price of goods, but the price of raw materials, making competition impossible. Other businesses can either attempt in futility to compete, or be absorbed by the larger company. At a certain point, capitalism is designed for monopolies. In this sense, there is an end to capitalism. This is where capitalism begins to look like communism in the extreme. When an enterprise becomes a monopoly, its customers are left no other options. They end up retaining about as much individual power as constituents in a communist state. Their choices are dictated to them and controlled largely by those in control of the means of production. Ironically, in order to protect the interests of the company, enterprises end up creating internal bureaucracies which look largely like the inflated entities of communist government. These have little accountability from department to department, and the majority of those involved are unaware as to what the others are doing. This makes navigating the bureaucracy for customers impossible.

There are a myriad of examples for how capitalist enterprises move into these extremes. Looking at the United States, we can see things like overpriced education, opacity of privatized health care, increased housing investment by hedge funds (4), the weaponization of debt, and rising income inequality (5), to name more than a few. To dive into each of these would warrant articles of their own. The aggregate effect of all, however, is rising income inequality. As the rich get richer and the poor stay poor (and the middle class either shrinks or stagnates), the impact on society is a collective ownership of property and the means of production in the hands of the few. This is reflective of state control of the economy. The difference is, this is not the state, this is the corporation.

Once each of these systems reaches their extremes, the differences boil down to who owns the means of production. What difference does it make if your home, your school, or your hospital are owned by a repressive state or a profit-oriented corporation? The point is, it doesn’t belong to you. The warning to retain is this: extremes of either political ideology offer little to no freedom to the citizenry. Both capitalism and communism are inherently anti-nationalist. Communism aims to eliminate the state altogether, but fails in its application. Capitalism is indifferent to the state, but in its excessive success ends up becoming a de facto state. Competitive marketplaces eliminate the need for the state to provide, and state regulation prevents enterprises from growing to point of competition with the state. This is where the horseshoe model provides us with clarity on the political spectrum. It is not that communism and capitalism share economic ideology, or that communism and fascism share political ideology. In their applications, both theories lead to relatively the same result, a politically repressed and economically deprived citizenry ruled by the few.

  1. Horseshoe theory. (n.d.). In Wikipedia. Retrieved June 16, 2020, from https://en.wikipedia.org/wiki/Horseshoe_theory
  2. Marx, K., & Engels, F. (1848). Manifesto of the Communist Party.
  3. Peterson, J. (2019, May 19). Marxism: Zizek/Peterson: Official Video. YouTube. https://www.youtube.com/watch?v=lsWndfzuOc4&t=3157s
  4. Semuels, A. (2019, February 13). When Wall Street Is Your Landlord. The Atlantic. https://www.theatlantic.com/technology/archive/2019/02/single-family-landlords-wall-street/582394/
  5. Horowitz, J., Igielnik, R., & Kochhar, R. (2020, January 9). Trends in income and wealth inequality. Pew Research Center. https://www.pewsocialtrends.org/2020/01/09/trends-in-income-and-wealth-inequality/