9 May 2019. Ferguson primarily based his explanations on data from the USA, where “socialism” is currently making a comeback with popular politicians like Alexandria Ocasio-Cortez and Bernie Sanders. But what is meant by “socialism” in the first place? Hardly what a European would understand by it; more what Europeans would describe as social democracy, for instance exemplified by healthcare for everyone or educational institutions which are of good quality and open to everyone.

Debate should not be about a new ideological battle between capitalism and socialism

In the US, people frequently referred to countries like Norway, Sweden or Finland when they talked about “socialism”, said Niall Ferguson. Although these were well-known for their markedly social-democratic policies, they were among the world’s most competitive and thus capitalist nations. According to Ferguson, this consequently meant that the debate should not be about a new ideological battle between capitalism and socialism, but about social-democratic issues such as fiscal redistribution. It was important to understand this and make the corresponding distinction.

Debate fiscal redistribution an quality of opportunity fairly and squarely

After all, socialist alternatives included Venezuela, which was drowning in the expected chaos, or China, which although it was economically successful in a capitalist manner, was far removed from being a constitutional state with a generally valid respect for human rights. Ferguson encouraged the western democracies to debate fiscal redistribution, quality of opportunity and many other things fairly and squarely. But he also warned us against giving up our freedom and indulging in a new fundamental debate about capitalism and socialism: this was not the point.

Niall Ferguson is a senior fellow at the Hoover Institution at  Stanford University and Professor at Harvard University’s Center for European Studies.