In a sense it is impossible to compare socialism and capitalism because they belong to different categories of reality and are thus essentially incomparable. Socialism is a political vision of a moral and religious character. Capitalism on its part is a self-regulating system that has established itself as autonomous in relation to the rest of the social structure. Of itself it deploys a purely functional or means-end rationality, closed to any ethical or religious considerations such as the solidarity of all persons.

Michael Novak in The Spirit of Democratic Capitalism has striven to transform capitalism into an ideal, but he can do so only by supposing against the historical evidence that there is an essential relationship between capitalism and democratic and liberal values. The absence of such a relationship has been recently shown again by the flourishing of capitalism under Ronald Reagan, while at the same time ‘liberal’ became a dirty word.

Again, Novak, unlike many recent defenders of capitalism, recognizes that ‘not all human goods and services are appropriately assigned to markets’. He allows that there should be ‘welfare provisions for those too young, too old, disabled, afflicted with illness or nervous disorder, etc., and unable to be self-reliant’.

I agree with those who find that qualification inconsistent with the principle of capitalism as a self-regulating market system. But it is none the worse for that. Implicitly it points us towards a development in the concept of the State and a rejection of the alternative: capitalism or a centrally planned economy.

There have been a number of political and economic regimes that have called themselves socialist. None of them has proved satisfactory.