State socialism is a political and economic ideology within the socialist movement advocating state ownership of the means of production, either as a temporary measure or as a characteristic of socialism in the transition from the capitalist to the socialist mode of production or communist society. Aside from anarchists and other libertarian socialists, there was in the past confidence amongst socialists in the concept of state socialism as being the most effective form of socialism. Some early social democrats in the late 19th century and early 20th century such as the Fabians claimed that British society was already mostly socialist and that the economy was significantly socialist through government-run enterprises created by conservative and liberal governments which could be run for the interests of the people through their representatives' influence, an argument reinvoked by some socialists in post-war Britain. State socialism went into decline starting in the 1970s, with the discovery of stagflation during the 1970s energy crisis, the rise of neoliberalism and later with the fall of state socialist regimes in the Eastern Bloc during the Revolutions of 1989 and the fall of the Soviet Union.
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As a term, state socialism is often used interchangeably with state capitalism in reference to the economic systems of Marxist–Leninist states such as the Soviet Union to highlight the role of state planning in these economies, with the critics of said system referring to it more commonly as state capitalism. Democratic and libertarian socialists claim that these states had only a limited number of socialist characteristics. However, others maintain that workers in the Soviet Union and other Marxist–Leninist states had genuine control over the means of production through institutions such as trade unions. Academics, political commentators and other scholars tend to distinguish between authoritarian state socialism and democratic state socialism, with the first representing the Soviet Bloc and the latter representing Western Bloc countries which have been democratically governed by socialist parties such as Britain, France, Sweden and Western social-democracies in general, among others.
As a classification within the socialist movement, state socialism is held in contrast with libertarian socialism which rejects the view that socialism can be constructed by using existing state institutions or by governmental policies. By contrast, proponents of state socialism claim that the state—through practical considerations of governing—must play at least a temporary part in building socialism. It is possible to conceive of a democratic socialist state that owns the means of production and is internally organized in a participatory, cooperative fashion, thereby achieving both social ownership of productive property and workplace democracy. Today, state socialism is mainly advocated by Marxist–Leninists and other socialists supporting a socialist state.