Where Socialism Has Been Tried and What History Shows

Socialism, in Marxist theory, is a system where the state controls the economy—industry, land, and production. It’s often summed up as “from each according to his ability, to each according to his need.” In practice, it typically becomes centralized control over pricing, production, and entire sectors of the economy.

For context, most developed market economies grow about 2–3% per year over the long run under stable, market-based systems.

The Soviet Union is the clearest large-scale example. From the 1920s to 1991, it ran a centrally planned economy. Early industrial growth reached about 5–8%, but later collapsed to roughly 1–2%. By the 1980s, shortages were normal. Forced collectivization in the 1930s contributed to famine conditions, with deaths widely estimated in the millions, including several million in Ukraine. It built military power—but everyday life struggled to function.

China under Mao followed the same model during the Great Leap Forward. Roughly 700 million people were placed into communes, and production was dictated from the top down. Reporting failures meant the system lost touch with reality. From 1959–1961, a catastrophic famine followed, with widely cited death estimates ranging from 15 million to 45 million. China only reversed course after introducing market reforms in 1978, triggering decades of explosive growth.

Cuba has been under state control since 1959, with most employment tied to the government. Over time, sugar production collapsed from roughly 6–8 million tons to under 2 million. Growth has stayed weak—often around 0–2%. Today, a large share of food is imported, and wages remain among the lowest in the region.

Venezuela is the modern warning sign. After nationalization and price controls expanded, oil production fell from over 3 million barrels per day to under 1 million. Between 2013 and 2020, the economy shrank by roughly 70–75%. Inflation spiraled into hyperinflation—often estimated above 1,000,000%. More than 7 million people have fled the country in recent years.

North Korea remains the most extreme closed system today, with total state control over production. The result: chronic stagnation, extreme scarcity, and a 1990s famine that killed anywhere from hundreds of thousands to several million.

Supporters often point to Nordic countries, but they are not socialist economies in the traditional sense. Roughly 70–80% of production is private. They are market economies with high taxes—not state control of production.

Across these historical examples of highly centralized economic systems, severe policy failures have been associated with shortages, economic collapse, and, in the worst cases, mass famine and loss of life.