“Can Socialists Govern a Capitalist State?” Max Elbaum’s recent article in Convergence poses a sharp question about socialist strategy. We’re organizing a round table of responses to explore, debate, and develop these ideas. All views expressed are the authors’ own. In this contribution, E. Gunn argues that democratic ownership and control of production are key components of a socialist approach to governing power.
Interested in contributing to the discussion? Contact submissions@liberationroad.org
By E. Gunn
In his article “Can Socialists Govern a Capitalist State?” (Convergence, September 28, 2026) Max Elbaum is absolutely correct about the importance of participating in electoral politics. He points out that the left and progressive movement needs to advance an attractive alternative that reflects socialist values as well as continuing the exposure of capitalism. The state is an essential terrain for class struggle—an essential step in the fight for governing power.
Engaging in the struggle in the electoral arena is required but not sufficient. The same objectives apply in civil society—the labor movement, community and faith-based organizations, movements for climate change and political parties, and the movement against white supremacy. These same objectives also apply for the market and the forces and relations of production and wealth creation—an arena, ironically, that is too often ignored by the left. Yet this is truly an essential terrain for any serious effort at transforming society. Indeed, the failure of the contemporary US left to contend with the private sector for control of the means of production guarantees a movement that is pushed to the margins and that creates a void that has been filled by the right.
We are living in the period of late-stage capitalism—a stage where finance capital and large capitalists have violated the social contract of the New Deal era and embraced neo-liberalism, cannibalizing our productive capacity. The demands of Wall Street have been to make the highest possible return in the shortest amount of time no matter the impact on our communities, the environment, and the working class. David Roderick, then chairman and CEO of US Steel, oversaw the shutdown of much of the company’s South Works plant in Chicago—a move that devastated the South Side community where it was located. Roderick summed up the company’s priorities bluntly: “I’m in this business to make money, not steel.”
In Chicago, manufacturing fell from roughly 700,000 in the 1960s to 65,000 today—a 90% decline. The same story was repeated around the country. In addition to the closure of large-scale plants, thousands of small manufacturing companies closed due to the retirement of the baby boom generation from ownership of companies with no successor. In the ‘60s, manufacturing represented 25-30% of GDP. Today, manufacturing represents 11% of GDP and it’s still declining. The de-industrialization of America was a principal cause of the deterioration of our society, with particularly devastating impacts on Brown and Black communities.
The loss of these companies and jobs was not simply a product of automatic “market forces,” but was actively enabled by neo-liberal policy and passive government. Yet these losses also e reflected the failure of key social movement sectors, including much of the the socialist left and the labor movement, to embrace strategies focused on the creation of wealth as they continued to fight for a better redistribution of wealth.
Various left organizations including Liberation Road have acknowledged the collapse of the economic and social paradigm. What’s missing is a strategy to fill that void with a socialist vision and practice—a new paradigm of development—with the objective of deep structural reforms directed toward community needs and sustainable production rather than short-term private accumulation.
Failure to offer a new paradigm of development and an industrial policy ensures that our movement will be marginal and unprepared to take advantage of the systemic crisis we witness. Advancing a new Third Reconstruction vision of development in theory and practice creates the opportunity for important strategic and tactical allies including sections of the business community, activists in the field of community economic development, the environmental movement, and others.
The Market as a Terrain of Struggle
Central to developing a socialist vision of production is recognizing the market as a terrain of struggle. Despite the views of many on the left, markets are not a capitalist construct: Markets, like states, existed long before capitalism. But capitalism transformed both, organizing economic and political power into formally distinct yet interdependent spheres. As within the state and civil society, the socialist movement must compete with its values and vision within the market.
There are important international examples that demonstrate the importance and power of advancing a vision of market development led by Marxist thought including:
Socialist China embraced the market in 1979. The results are staggering. 350 million people have come out of poverty. China is a global leader in addressing the climate crisis and is leading the growth of advanced manufacturing. Manufacturing represents 25% of GDP.
The Basque Country—a region that includes Mondragon in Spain—is a global leader in development that has created an intersection of advanced manufacturing, economic democracy, and community development. In Mondragon, there are 110 cooperatives employing 80,000 people. It is among the most prosperous regions in Europe with low rates of poverty and unemployment. Manufacturing represents 42% of GDP!
Emilia Romagna, Italy is another example of the power of the working class when it advances a vision of production. The Italian Communist Party embraced the growth of cooperatives and entrepreneurial government. Northern Italy is the most prosperous region in the country. Manufacturing represents 30% of GDP.
Britain: Leadership in the British labor movement including the perspectives of Costas Lapavitsas is advancing the importance of the Marxist movement engaging the issues of wealth creation and offering an alternative to neo-liberal thinking.
Elbaum’s framework of struggle “with, against, and beyond” the state also offers a way to think about markets. With the market, we can build worker cooperatives and other enterprises that develop our productive capacity. We can create strategic and tactical alliances within existing traditional companies in responding to market pressures. Against the market, unions and community organizations fight over wages, working conditions, and the distribution of wealth. Beyond the market, we can expand public services, commons, and other forms of collective provision that meet people’s needs outside market exchange. This last dimension also has a longer-term meaning: as with a governing strategy within the capitalist state, so too building socialist productive power within capitalist markets creates contradictions that will ultimately have to push beyond the market in its capitalist configuration.
Until now, most sections of the US left have been mainly focused on a strategy of “against the market.” Overall, they could be characterized as left economists—a militant embrace of strategies focused only on issues related to the redistribution of wealth, working conditions, and justice. This focus is at the heart of the Alinsky tradition. “Class struggle unionism” is reduced to immediate demands rather than a transformation of society. While continuing to lead the struggle for redistribution of wealth, union rights, and better working conditions, the left needs to lead strategies focused on the creation and control of wealth—rebuilding the means of production as a foundation for a truly sustainable society.
While this tradition is underdeveloped, there are existing models we can pull on. In the US, there are around 7,000 worker-owned companies. 6,600 companies have ESOPs and employ 15 million workers. There are 1,300 cooperatives. These are one part of a growing social economy—a sector that should clearly be represented in a socialist movement. Several examples stand out:
Morse Cutting Tool Campaign: The successful effort by Ron Carver of the United Electrical Workers to prevent the closing of Morse Cutting Tool—a subsidiary of Gulf + Western. This campaign framed the plans by G+W to close the company as “good business vs. bad business” in exposing the destructive corporate strategy of “milking the cash cow.” The union built a broad-based coalition in their campaign and successfully won the support of the Mayor of New Bedford—Brian Lawler to threaten the use of eminent domain to block G+W’s plans—an early model of “entrepreneurial government.”16 hundreds of jobs were saved by a union taking over responsibility for the stewardship of a manufacturing company that was an anchor in New Bedford, MA.
Bronx Ecology Project: The Bronx Ecology Project led by Allen Hershkowitz of the Natural Resources Defense Council, to utilize new technology in taking the ink out of paper without using chlorine as the foundation for creating a paper mill in the Bronx borough in New York City that would be owned by the community and create thousands of jobs. The project was not successful but advanced a new model of community development anchored in advanced manufacturing.
Sharpsville Quality Products Campaign: The efforts of Steelworker Local 1355 at Sharpsville Quality Products in Pennsylvania to save their jobs by occupying the plant then buying the company with the support of Tom Croft and the Steel Valley Authority, among others. This represented an early effort by the labor movement to take the lead in the creation of wealth as they blocked low road short-term profit maximization strategies by the owner.
An economic program for the Third Reconstruction
Embracing the issues related to the forces and relations of production significantly expands our influence in key areas of our economy and society. These issues must be a key component of the Third Reconstruction.
We have the opportunity to lead in the expansion of the social/solidarity economy where millions of people participate in cooperatives in housing, farming, social services, health care and other sectors.
We need to expand employee ownership and economic democracy in all sectors. This is where our base can learn to manage production guided by socialist rather than capitalist values, which are essential for revolutionary change. In production, we must embrace new technologies like robotics and artificial intelligence that can increase productivity. If used in the wrong hands, these new technologies can dramatically cut jobs. Through economic democracy, it will be the working class determining how they are used, where they are used, and when they are used. Guided by a socialist vision and values, these technologies will contribute to building society rather than tearing it down.
This approach segments the capitalist community. Rather than the illusion that the capitalist class is a monolith, our programs will distinguish between the High and Low roads and identify tactical and strategic allies in the market as we isolate and finally demolish the predatory sections of capital. We need to support the existence of socialist entrepreneurs as strategic partners that challenge and compete with capitalist entrepreneurs.
Our political work should include advocacy for our industrial policy such as the American Manufacturing Renaissance Act (HB 9970) that has been introduced to Congress by Representatives Ro Khanna, Jan Schakowsky, and Danny Davis. We should advocate policies and legislation at the state and local level that mirror the national act. These aren’t revolutionary acts but provide the resources needed for a revolutionary transformation as the crises deepen.
Conclusion
The left needs to embrace the importance of policy and practice on the issues of the forces and relations of production as a central component of our strategic plan. With this goal in mind, we need to initiate a discussion on these issues throughout the movement.
We need to embrace the objectives outlined by Elbaum and apply them not only to the state and the electoral arena but also to civil society as well as the market. We are at a moment where the potential for system change is greater than in the 1930s or the 1960s. We need to offer a compelling alternative economic system that manages the creation of wealth and the reconstruction and reindustrialization of our society.
E. Gunn is a veteran labor and community organizer.
Comrade Gunn has provided us with an excellent starting point on Max Elbaum's piece, which I also support. Together, they are unfolding a much-needed discussion within Liberation Road, and he left generally. I would only add two points.
1. It's worth noting that our country already has an industrial policy of long duration, a military-industrial policy, which has prevented us from having things considered more or less normal elsewhere: universal health care, tuition-free higher education, and decent high-speed rail, for starters.
2. Looking ahead, to the turmoil over AI and Data Centers. The debate shouldn’t be a false binary between "shut it all down" or blindly accepting rapid corporate development. We must address control and utility simultaneously; when facing a dilemma, political action can operate on two levels at once: the level of structural constraints and the level of consent regarding long-term strategy, utility, and public goals. Applied here, we must actively regulate and control construction now. But if we focus only on immediate ecological threats, we lose the longer war of position. We must simultaneously look through a second lens of public vision. Data centers are, at their core, massive digital libraries. Do we want them to be public libraries with public librarians? Or private enclosed libraries rented out in dribs and drabs, if at all, by Silicon Valley elites like Thiel and Musk? We want the former, not a future with technology entirely in corporate hands.