Society and Culture

Socialism, Capitalism and Millennials

On 6 July, the IEA held its annual THINK conference at the Royal Geographical Society in London. It included a panel discussion entitled “Socialism, Capitalism and Millennials” with Dr Steve Davies, Joseph Sternberg, Dr Kristian Niemietz, Dr Rainer Zitelmann and Rebecca Lowe. The article below is a rough transcript of Kristian’s opening statement.


The rise of “Millennial Socialism” is often interpreted as a counterreaction to genuine failings of the status quo. According to this argument, the current system is failing young people, so, quite understandably, they are turning against it.

Up to point, I agree with that. It is true that current economic policies are often biased against younger people, that is, Millennials and Generation Z (and you could include the younger cohorts of Generation X as well). This is especially true of our housing policies, but also, more generally, of the composition of public spending. So I do not find it hard to understand why young people are not especially happy about current arrangements. Their discontent has a real basis. Those issues are real, and the criticisms justified.

What I find more puzzling is why so many of them seem to think socialism, of all things, is the solution. Why on earth would the solution be socialism?

There is a well-known logical fallacy that you have all come across: “We need to do something; this is something; therefore, we need to do this.” Millennial Socialism strikes me as a variant of that fallacy: “We need something that is different from the status quo; socialism is different from the status quo; therefore, we need socialism.”

That doesn’t follow at all. But that is the conclusion that a lot of Millennials seem to be drawing. Earlier this year, the Economist ran a cover story entitled “The rise of Millennial Socialism”. Then a bit later, the New Statesman also ran a cover story with an almost identical title. As you would expect, those two magazines differed in their assessment of the phenomenon. The Economist was mostly critical of Millennial Socialism, despite its usual on-the-one-hand-on-the-other-hand waffle. The New Statesman was very supportive of it. But they agreed on one thing: that Millennial Socialism was a real thing, not just some fluke.

Which is true. There can be no doubt that the Overton Window, which is, loosely, the range of socially acceptable political opinions, has shifted massively to the left in recent years, and this is partly a compositional, i.e. generational phenomenon.

There is a lot of survey evidence on this. Just one example: in a survey last year, two out of five people under the age of 35 agreed with the statement that “Communism could have worked, if it had been better executed”. You’ll recognise this statement. That’s a variation of the old cliché that “REAL communism has never been tried”. It is a cliché, sure. But it’s also a view that’s genuinely, and widely held. Most of the others, by the way, don’t actively disagree with that statement, they just choose non-committal responses like “Don’t know” or “Neither agree nor disagree”.

Surveys like that are a dime a dozen. There’s nothing special about this one, but there’s nonetheless a reason why I’ve picked it out. I know that a lot of free-marketeers don’t want this to be true, they don’t want to admit it to themselves. So whenever a survey shows widespread support for socialism among they young, they’ll say, “Ah, no, that’s all just a misunderstanding. They may say that, but they don’t actually mean “socialism”. They’re just confusing “socialism” with “Nordic social democracy”. It’s really Sweden or Denmark they have in mind.”

The term “socialism” can indeed be a bit ambiguous – it can mean different things to different people. But this survey uses the term “communism” instead of “socialism”, which removes a lot of that ambiguity, and it changes almost nothing. In fact, the term “communism” itself has made a huge comeback over the past year or so. It’s become a big fashion statement. Don’t even get me started on “Fully Automated Luxury Communism” or “I’m literally a communist”!

So what should those of us who still hold the unfashionable view that the market economy isn’t so bad do about Millennial Socialism?

It’s two things, broadly. Firstly, of course we need to make a positive case for the market economy. We need to show that there are credible, market-compatible solutions to the problems that Millennials are facing. This shouldn’t be too hard. The housing market, in particular, is an area that’s basically crying out for free-market reforms. This should really be a low-hanging fruit.

But that’s not enough. Millennial Socialism is not a nostalgia for the old Soviet Union, or the old Eastern Bloc. Rather, socialists always compare real existing capitalism, warts and all, to an imaginary, idealised socialism. In such a comparison, capitalism can never win. Sure, you can propose specific improvements to real existing capitalism in Britain, perhaps on the basis of reforms that have worked well elsewhere. But that’s still real existing capitalism. You’d still be limited by what actually exists in the real world. You’d be proposing something that doesn’t currently exist in Britain, but it exists somewhere. You’re not talking about a utopia. Socialists do. And you can’t beat utopia with real-world examples.

We also need to make a negative case against socialism. Millennial Socialists believe that socialism could be completely different from anything that’s existed in the past. They believe that socialism could be democratic, participatory, empowering, freedom-enhancing.

What they don’t seem to realise is that this is not a new idea. This is what socialists have always said. All socialists everywhere. All the way back to the October Revolution, and before it. That was always the promise. That was always the idea.

Millennial Socialism is not a new kind of socialism. It’s just the same old socialism, repackaged as hip, cool and fun. Unfortunately, “cool” socialism will fail just as badly as the uncool kind.


Kristian Niemietz is the author of the book “Socialism: The Failed Idea That Never Dies“.

Head of Political Economy

Dr Kristian Niemietz is the IEA's Head of Political Economy. Kristian studied Economics at the Humboldt Universität zu Berlin and the Universidad de Salamanca, graduating in 2007 as Diplom-Volkswirt (≈MSc in Economics). During his studies, he interned at the Central Bank of Bolivia (2004), the National Statistics Office of Paraguay (2005), and at the IEA (2006). He also studied Political Economy at King's College London, graduating in 2013 with a PhD. Kristian previously worked as a Research Fellow at the Berlin-based Institute for Free Enterprise (IUF), and taught Economics at King's College London. He is the author of the books "Socialism: The Failed Idea That Never Dies" (2019), "Universal Healthcare Without The NHS" (2016), "Redefining The Poverty Debate" (2012) and "A New Understanding of Poverty" (2011).

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