Yellow Socialism vs. Capitalism

Instructor: Christopher Muscato

Chris has a master's degree in history and teaches at the University of Northern Colorado.

Socialism and capitalism have pretty different ideas about the economy. In this lesson, we're going to see how a radical variation known as yellow socialism changed this conversation.

Communism

According to Karl Marx, here's how communism is supposed to work: the capitalist societies that oppress the workers will be replaced (via worker's revolutions) by socialist societies. Socialist societies act as a transitional period, allowing some capitalist ideals while paving the way for full collectivization into communism.

However, not everyone agreed. In 1902, French politician Pierre Biétry demonstrated his dissatisfaction with the socialist party (to which he had once belonged) by forming the Fédération nationale des Jaunes de France (the National Federation of Yellows of France). This group was to be the champion of what he called 'yellow socialism', a term chosen to distinguish it from the ''red'' socialism of Marxism.

Yellow Socialism

Yellow socialism rejected Marxism's belief that the workers needed to unite in an international revolution to seize the means of production. Instead, yellow socialists thought workers and owners could cooperate in the name of hyper-nationalism. So, does this mean that, unlike Marxists, yellow socialists were pro-capitalism? Well, it's complicated.

Yellow socialism rejected the belief that a proletariat revolution was necessary to resolve class conflict
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Yellow socialism was a growing political theory from 1902 through World War I, when it faded away. It was never the dominant ideology, but we can get a sense of what they thought an ideal economic system would look like. Let's start with the parts of yellow socialism that seem to support communism.

Off the bat, we have to acknowledge that yellow socialism rejected the Marxist vision of creating classless utopia. The elimination of class was not a goal of yellow socialism, nor was the promotion of an international workers' riot to seize the means of production.

Instead, Biétry believed that workers and owners (the proletariat and bourgeoisie) could coexist, each represented by their own trade unions unique to that sector of the economy. In essence, each industry would have its own union, often called a syndicate, which would have branches that represented both the workers and the owners.

It's worth noting that these are a very specific kind of union, sometimes called company unions, in which the union was controlled by the employer. So, these aren't independent unions. Workers' and company unions existed together and were managed by the same people at the top.

Yellow Socialism and Pro-Capitalist Ideas

Yellow socialists believed that through these unions, the workers could be elevated out of oppression while still maintaining capitalism. There would be no need for a workers' revolution, and the nation could focus on strengthening its borders and national unity instead.

In fact, there were many capitalist principles that yellow socialists actively encouraged. For example, they thought that private property made for a good incentive, and that ensuring access to it could quell the conflict between the classes. They also believed in a free market, at least to a certain degree.

Opposition to Capitalism in Yellow Socialism

Regulation

So, in what ways did yellow socialism oppose capitalism? Pure capitalism relies on a free market which, theoretically, is supposed to be as unregulated as possible. This is where yellow socialism starts to have clearly different beliefs from traditional capitalism. While the free market did technically exist in yellow socialism, it certainly wasn't unregulated. In fact, just the opposite.

Yellow socialists believed that all of society had to be tightly managed and controlled by a powerful dictator and his elite class of administrators. This included the economy. Remember those company unions that yellow socialism proposed? In this system, worker and company unions would not be independent, but would both be managed either directly by the state or by elite owners who cooperated with the state.

Anti-Semitic cartoon from 1898 showing a peasant oppressed by the monarchy on top, and a peasant oppressed by Jews and capitalists on the bottom
anti-semetic cartoon

Yellow socialists believed that the economy had to be carefully regulated by an authoritarian state, and that failure to do so could place the security of the nation in jeopardy. A large reason for this was the basic anti-Semitism that informed hyper-nationalism in Europe at the time. European Jews were accused of controlling the banking system and rigging the economy in order to keep the proletariat oppressed. Therefore, a nationalist economy had to be tightly controlled by the authoritarian state in order to protect it.

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