A socialist state is defined as a country where the political aim is to use state power and government policy to establish or maintain a socialist economic system. Essentially, a socialist country is a nation where the government aims to abolish free enterprise and take control of the economy and private property.
Many think of Spain as having a large government, extensive welfare benefits and state involvement in aspects of the economy. This is especially true compared to the United States. So, would it be correct to describe Spain as a socialist country? Definitely not, and let us explain why…
1. Spain’s Economy Allows For Free Enterprise
A first reason why Spain is not a socialist country is because its economy allows for free enterprise.
In socialist countries, the means of production are owned by the state. This means that any business or enterprise that produces a product or profit is owned by the government. Socialist countries believe this creates a more equal economy, as in socialist theory the state is collectively controlled by the nation’s workers. Essentially, in socialist countries there is no private businesses.
Spain is not a socialist country because it has a free market economy. People in Spain can set-up and run their own private businesses with limited interference from the state. Those who operate businesses in Spain can keep their profits. Spain’s free market economy allows people to invest in private companies and there are no limits of the size a company can grow to.
Although there are sectors within the Spanish economy that are nationalised – owned by the government, these are small sectors within the larger economy. Spain has major industries including manufacturing, pharmaceuticals, agriculture, automobile engineering and tourism that are all open to free enterprise.
Probably the biggest reason why Spain is not a socialist country is because it has a free-market capitalist economy.
2. Spain Has A Free Labour Market
A second reason why Spain is not a socialist country is because it has a free labour market.
Socialist economies put constraints of their labour forces. In socialist countries, the state controls the means of production – meaning all businesses are owned by the government. In order to provide workers for these state-owned enterprises, almost all socialist governments have directed their labour markets. Essentially, in socialist countries the government tells you where to work, you don’t necessarily choose your own job.
Spain is not a socialist country because its labour market is free from government control. In Spain, people are able to choose where they work. Spanish people can train in the industry they choose and apply for the jobs they feel most qualified for.
As well as workers in Spain having the freedom to choose where they work, businesses in Spain are able to decide who they hire. Spain has an open and free labour market meaning people are not directed by the state where to work.
Another key factor in Spain’s labour market that shows it is not a socialist country is that wages are set by the market. Although Spain does have a minimum wage, above this workers negotiate with employers to set salaries and these are determined by how the wider economy is functioning. The government does not set wages in Spain, unlike in a socialist country.
3. The Country Has Limited Nationalised Industries
A third reason why Spain is not a socialist country is because there are only limited sectors of the economy that are nationalized.
Nationalisation means a business being owned by the state. A nationalised industry means a sector of the economy that only the government can operate in. In socialist countries, almost all industries are nationalised. This prevents private enterprise and capitalist competition and is supposed to create a fairer society.
In Spain, limited sectors of the economy are stated owned. The railways, petroleum industry, tele-communications and the national airline are all, or have been at some point, nationalised in Spain.
Although there is state intervention in the Spanish economy, the majority of enterprise in Spain is conducted along capitalist principles. If Spain was a socialist country, most of the economy would be state-owned. Spain has a majority free market economy, and this is why it is not a socialist country.
4. Spain Does Not Have A State-Controlled Banking Sector
Another reason why Spain is not a socialist country is because it does not have a state-controlled banking sector.
In socialist countries, the banking and finance sectors are controlled by the government. There are not independent banks or financial institutions. People in socialist countries must have accounts with and borrow from state-owned banks. Socialist countries also put tight controls on the financial market in order to control the economy.
Spain has a capitalist-driven banking sector. Financial institutions in Spain can make a profit which they can return to their shareholders or reinvest in their businesses. The government in Spain does not control the financial sector and there are limitations on how much the government can influence the financial markets. This highlights why Spain has a capitalist, and not socialist, economy.
People in Spain can choose where they bank, and banks compete to attract customers. There are a range of financial services in Spain which people can choose from. The freedom within the financial sector of Spain is a key reason why it is not a socialist country.
5. The Country Has Private Sector Involvement In Utilities And Public Services
A further reason why Spain is not a socialist country is because the utilities and public services are not entirely state-owned.
In socialist countries, the utilities – electricity, water, and gas, are owned by the government. The state controls these sectors of the economy and directs them as needed. Socialist countries also have state control over public services. Economic sectors such as education, healthcare and transportation are also state-owned.
In Spain, the utilities are under a mixture of state and private ownership. Although there is state involvement in the utility’s companies in Spain, the fact that they are partly private owned means that Spain is not a socialist country.
Public services in Spain are also not state-owned and include private businesses. Although the Spanish government does run schools and healthcare facilities, there are also private providers that people can choose. Most of the railways in Spain have been nationalised since the 1940s, however there is competition in the transportations sector as the bus network, car hire and taxi companies are all private businesses.
Spain is not a socialist country because the Spanish government does not entirely own the utilities and public services of the nation.
6. Spain Is A Multi-Party Democracy
Spain is democratic country where voters choose between different political parties at free and fair elections. This is another reason why it is not a socialist country.
Although socialism is a predominantly economic system, all socialist countries in history have not been democratic. In order to manage the economy, and retain control of the means of production, socialist countries have been forced to become authoritarian. Spain is a democracy, and this is a key reason why it is not a socialist country.
People in Spain are able to vote for their leaders at national and local levels. Elections in Spain are open and free, and the state does not interfere in the election process. Politicians in Spain are accountable to the people. There are peaceful transfers of power in Spain and different political parties have governed the country.
Some would argue that it is possible for a fully socialist state to be democratic. However, there has never been a fully socialist democracy in history. The fact that Spain is a well-functioning democratic society is an important factor in why it is not a socialist country.
7. Spain Has A Free Press And Independent Judiciary
A final reason why Spain is a not a socialist country is because it has a free press and independent judiciary.
As we’ve said, socialism is an economic model. However, socialist governments throughout history have had to exert control over their populations in order to hold their power. There are many reasons for this, including a need to retain dominance over the economy, prevent the ‘non-working classes’ from taking back the means of production and commanding the economy as is needed.
All fully socialist countries in history have restricted individual freedoms, including reducing freedom of the press and limiting the independence of the legal system.
People in Spain enjoy freedom of speech. There is no major state involvement in the press and newspapers, broadcasters and websites are free to criticize the government.
Spain has an independent judiciary, and the state does not exert influence over the courts. The legal system in Spain is not controlled by the government and acts independently in-line with the constitution and laws of the country. People in Spain are generally not subject to arbitrary arrest or detention, and not on the order of the state.
The fact that Spain has a free press and independent judiciary are key indictors that it is not a socialist country. As we have said, every fully socialist country in history has failed in these areas.