The Left in many countries has been in decline, largely because the cross-class coalition that social democrats have historically embodied has unravelled.  Socialists have moved to the right, embracing neoliberal policies which have fuelled inequality. This has prompted alienated working-class voters to shift to the far right, while many more have abstained from voting altogether in recent elections.

It all started in the early Eighties when many socialists abandoned their ambitions, and a market-oriented Left asserted itself.  In 1984, the future French president François Hollande set the stage by declaring that the "dogmatic conception of the working class, the idea that the workplace could also be a space of liberty, the notion that individuals belong to social groups tied together by solidarity must be abandoned." 

Particularly for the benefit of today's young people who know little about it, socialism is a system of economic organisation whose purpose is the advancement of the well-being of people and society, rather than the accumulation of private wealth.  Socialists believe that the essential foundations of life   ̶   health, education, care, housing security, energy, water, and the monetary system itself   ̶   are too important to be left to markets whose priorities are profit, scarcity, and exclusion.

It then builds on this idea to create a broad range of approaches that typically include collective responsibility for essential state-funded free services; democratic control over key economic issues such as essential services, investment, energy, infrastructure, and money creation; limits on rent-seeking and monopoly profit maximisation; a commitment to equality, to be implemented through the redistribution of income and wealth.

These approaches do require a caveat. Socialism does not necessarily abolish markets. Nor does it mandate an all-powerful state. Rather, it defines the appropriate roles of each. The result is that socialism treats markets as tools, not masters.  For this purpose, markets are regulated to prevent labour exploitation, monopoly power, ecological damage, and financial instability.

Socialists argue that the capitalist system does not work in our favour because it doesn't care for us at all. We have no true control over our own lives and are merely treated as a means for profit. Because of this, socialism proposes that, instead of allowing companies to run themselves, the government should be given total control of society's means of production.

In this scenario, the state is seen as the articulation of society's collective will and not an intruder into economic life.  In theory, a socialist state is neither authoritarian nor omnipresent; rather, its structure enables and coordinates the people's shared decisions.  The state provides basic security; provides infrastructure and investment; prevents the concentration of private power; and ensures public accountability where essential services or core economic infrastructure are concerned.

However, the examples of the Soviet Union, Cuba and Venezuela make it clear that this concept does not work.  Socialism promised quite specific results; it did not deliver. This is best illustrated in Alfred Hayek's last book "The Fatal Conceit: The Errors of Socialism." 

The ex-socialist republics also demonstrated that power is inherently corruptible, and that economic might and political power are inextricably linked. In our capitalist society, it is familiar to us to hear about the influence of the wealthy on politics. But the replacement of capitalism by a system where the government had both   ̶   and gained leverage over everybody through economic and political power   ̶   did not mean that the injustices of capitalism suddenly disappeared.

Socialism triumphed for a while, both as an idea and in reality, but its success was never complete. Even in communist countries, there were isolated residues of the classical political economy, and some markets were allowed to remain free from politicised direction, particularly in Western countries. 

Many have shifted away from the mind-set of socialism. However, they have not necessarily put their faith or belief in a non-socialist alternative.  They may accept socialism's failure but balk at the alternative represented by the free market system, even if tempered by elements of the welfare state.

For some two decades now, neoliberalism has ruled the roost, rejecting the idea that the economy revolves around collective well-being, democratic control, or mutual obligations to one another. It elevates private property, market allocation, and the interests of financial capital to the pinnacle of economic and political life.

The private-ownership market economy does a better job in producing more goods and services than the socialist one.  At the same time, it allows individuals greater freedom in choosing where, when and to what purpose they will put their capacities to produce values that they expect others to demand. 

Its distinguishing feature is that markets are both natural and superior. They are the ultimate test of value, the best method to allocate resources, and a tool that disciplines individuals and governments alike. This set of beliefs persists even when markets routinely fail by generating inequality, excluding the vulnerable, mispricing environmental damage, undermining democracy, and rewarding speculation over productive activity.

Crucially, anti-socialism does not diminish the state: it repurposes it.  In fact, many times anti-socialism just fuses market dogma with state re-engineering. It constructs a political regime in which society is compelled to adjust to the demands of markets, and where markets, in turn, are shaped to serve the wealthy and powerful.  The starkest demonstration of this is Trump's America, where the blue-collar class and middle class have been tricked into fuelling the greatest ever rise in the wealth of a small set of multi-millionaires.

The excesses and failures of socialism led to widespread scepticism about the efficacy of politics and political solutions to achieve economic results. Bureaucracies became mistrusted; politicians were no longer the heroes of legend. The faith in political and government nostrums all but vanished, as a principle.

However, this loss of faith in politics and in broadly defined socialism, have not been accompanied by any demonstrable reconversion to the laissez faire vision that was central to the teachings of the classical political economists. There remains a residual unwillingness to allow the free market an unfettered freedom to evaluate what people value and to organise production accordingly.  We are left, therefore, with an attitude of nihilism toward economic organisation. Politics will not work, but there is no generalised willingness to leave things alone.

The political fall-out from the dead of socialism is well known. When the Left abandoned socialism and embraced the middle class instead, it not only lost the working class, but also the educated middle class for whom it had started pretending to speak.  This was because the Left failed to understand that in reality the choice of one versus the other was a false one. 

The interests of the working class and the educated middle class actually largely align with each other.  This was, in fact, the outcome of a Swedish study by the union-backed think-tank Katalys.  Other surveys show that ambitious welfare policies, as well as taxation of the wealthiest, enjoy cross-class support.

A ground-breaking study about this was that of the sociologist John H. Goldthorpe and the economist David Lockwood, in which they argued that members of the working class were experiencing important changes in their everyday lives.  Workers were not simply being assimilated into the middle class, they contended, but instead there was a convergence between the middle and working class. In what they called an "embourgoisement" process, they implied that a newly prosperous working class was losing its identity and becoming socially indistinguishable from sections of the middle class who were previously their social superiors.

Lockwood argued that it was important to understand a person's class position in terms of market situation (income, security and career possibilities), work situation (the set of social relationships in which the individual is involved at work by virtue of their position in the division of labour) and status position (the position of the individual in the hierarchy of prestige in society at large).

Personally, I believe that to announce the death of the working class or its total absorption into the middle class is premature. My view is that today's working class needs to be identified not only by its income but also by its educational attainment, which are closely linked. When one considers that in Malta just over 29% of the working age population (15-64 years) - that means around 118,780 persons   ̶   still have less than a primary level of education and therefore low income, there's no doubt that we still have a substantial working class.  It has certainly been re-dimensioned considerably   ̶   from 56% in 2012, but still five percentage points higher than the ratio in the EU27.

Both main political parties still attach a lot of importance to identifying with the working class, though class struggle language is not as rabid as it used to be.  The Labour Party has emulated foreign labour parties in dropping the socialist appellation and moved to claim the middle class as its own.  The Nationalist Party also claims it is a party of both classes, but one takes that with a pinch of salt, considering that, according to opinion polls, a substantial portion of less-educated people still identify with the PL.

In any case, the death of socialism as we knew it during the post-war years can certainly be declared in Malta too, though thankfully, socialist ideas still feature in centre politics.  I believe that the PL's fourth consecutive electoral win was made possible by the perception of the PL as a middle-of-the-road party with policies more attuned to the diverse sectors of the electorate.   Similarly, though, the PN's much-improved result was made possible by a marked shift in the party's stance. 

One augurs that, though both parties will remain locked in a struggle for power, there will be a much-needed convergence on issues that are crucial to the pursuit of the national interest.   

Frans Camilleri is an economist. He studied at Oxford and University of East Anglia, is a former corporate head at Air Malta, and has served on various public and private boards.