With the victory of the Social Democrats in Germany, a year and more after Labour finally managed to win a British election, 11 of the 15 states in the European Union now have governments in the socialist tradition.

That is surprising. Socialism is yesterday’s idea, after all, and since the Soviet collapse of 1989-90, hardly anyone thinks otherwise. Germaine Greer remarked, in her devastating way, that it makes people think of crinolines. But then the 11 governments were not elected on socialist programs, and nobody expects anything of the sort from them. In fact they are busy doing some notably unsocialist things, like privatizing. In Britain, for example, where conservative governments in the Thatcher-Major years privatized almost everything in sight except the post office, Tony Blair’s government may yet attempt to do just that. Shortly before it took office in May 1997, Labour untied its own hands by abolishing Clause Four of its constitution, which since 1918 had committed it to the common or public ownership of production, distribution, and exchange. In France, similarly, a socialist government privatizes as if it had no past to live down, and the new governments of Germany and Italy arc as business-minded as any there have ever been. Even faraway China has its free-enterprise zones. So the mood on the left is not for crinolines, and the 11 governments, like the socialist majority in the European parliament, keep no capitalist awake at night. It is the name that survives, not the thing. It is all right to call yourself a socialist, apparently. But it is not all right—plainly impossible, if you want investment—to be one. The banners may still be red, but the uniforms are bright blue.

That makes the European electorate sound hypocritical, though I suspect a better word is canny. They waited till the left decaffeinated, and it was a long wait. One certainty that emerges here is that socialism is not a popular idea and that socialists, at long last, know it. The refugee flow across the Iron Curtain was overwhelmingly westward, and it was the poor, above all, who fled. When Tony Blair became party leader, he bluntly told British Labour that if they ever wanted to win an election, after four humiliating defeats, they would have to give up what they had always believed in. You change or you die. “I have spent my life advocating socialism,” I remember the Oxford historian A.J.P. Taylor remarking sadly towards the end of his life, “and now I realize that nobody wants it.” So European socialists decided to junk their convictions. “What are we going to do if we give up everything we believe in and then lose?” one delegate was heard to wail in the tearoom at a Labour conference. That was candid. It may be all right to sell your soul, as Faust did. But you had better get a return on it.

The remarkable thing is that European electorates are prepared to play along with this, which is where the canniness comes in. They are not cynical, just coolly appraising. They do not want socialism, and are prepared to vote for those who have repented of it. No point in an elective constitution if the same people are always in power, after all, even if you think they are getting it more or less right. A consumer society, in any case, has no loyalties. It will try a new brand in the polling booth much as it does in a supermarket. Besides, there is said to be rejoicing in heaven for the sinner that repenteth, and repentant socialists are not seen as turncoats. If there was once egg on their faces, in the days of Clause Four, they have taken good care to wipe it off. They wear business suits, lunch and dine with businessmen, accept a widening gap between rich and poor, and talk the language of the boardroom as if making money were the only game in town.

Which of course it is, though you sometimes wonder why it took them a century and more to notice it. Wiping off the egg was a good idea, but it is still a question why they were content to wear it for so long. There were convincing reasons, after all, why socialism was always unlikely to favor the poor. It was highly monopolistic, for one thing, and monopoly traditionally favors the wealthy and the privileged. You would expect the rich (or those keen to be rich) to want nationalization and the poor to want competition. That is a familiar pattern in the United States, where, since the time of Theodore Roosevelt, antitrust laws have been designed to keep robber barons under control. But state monopoly is a perfect territory for a robber baron; the rich can exploit socialism, and did. In Witness to History, Armand Hammer has told how Lenin gave him a free hand with certain commodities in the infant Soviet Union and guaranteed him something no free economy can offer—an immunity from strikes. Like Hitler after him, Lenin nationalized the labor unions. Capitalists can make big money out of socialism if they play it right, and the young Hammer, whose father Julius had helped to found the American Communist Party, had no intention of being a poor man.

State monopoly has a history, one far older than socialism. Older, too, than the free market, which is barely two centuries old as an idea and even younger as a fact. Elizabeth I of England, who has never been a heroine of the left, sold monopolies to her courtiers to fill her exchequer. The Pharaohs in ancient Egypt had state monopolies, and not just for building pyramids. For most of human history, monopoly has been naturally seen as right-wing. It existed to favor the privileged.

There is more egg to come, or (to put it another way) we are still under the yolk. Another great myth of socialism, in its day, was that economic planning favored the poor. It was never quite explained why, and those who believed it were never good at offering convincing answers. Planning means planners, after all, and planners make for comfortable bureaucracies with tenured, pensionable posts, the pensions being cozily indexed against inflation. It is not usually the poor or uneducated who get such jobs. Power favors the powerful, and the most certain effect of economic planning is that it ensures the creature comforts of those who plan. The hefty privileges of the Soviet nomenklatura—town houses and country houses, opera boxes and chauffeur-driven cars staffed by servants paid out of state funds—are a memory that will not quickly die. Socialist privilege was patent. As an old New York Trotskyite sadly remarked years ago after a visit to the Soviet Union: “I’ll take my chance in the capitalist jungle.”

Socialism, at least in its democratic form, could be good news for even the stock market. In the quarter-century after 1966, the London stock market performed over twice as well under Labour as under the Conservatives (31 percent a year as against 12 percent); and in November 1991, the Daily Telegraph, a London newspaper of impeccably Conservative credentials, reminded investors that the market had more than tripled in 1974-9, when Labour was last in power. The reasons are likely many, but some of them, though predictable, were not widely predicted. It is not just fear of inflation; in fact, inflation averaged only two percent higher per year under socialist governments. But when you nationalize and pay compensation, as Labour did, you pour millions into the market, if there is reinvestment; when you privatize, as Conservatives did, you drain existing shares of support in favor of a new flotation. So nationalization tends to drive the market up, privatization to drag it down. Investment managers were well aware of all this, but it was seldom mentioned in public debate, and it is doubtful if any socialist, in his worst nightmare, ever dreamed of it. Difficult to go on being a socialist if yon did.

Another truth seldom mentioned is that socialism was bad news for state welfare. Many European governments, socialist or not, are now busily looking for ways to curb the inexorable rise of welfare spending—usually by raising charges, targeting payments to the needy, and enforcing job-seeking as a condition of benefits. There is usually a cry of protest from the left when they do, and if the government calls itself socialist, it is often suggested that it is betraying its traditions.

That shows how little the left knows about its traditions. State welfare was born in 1883, the year of Marx’s death, when Count Bismarck, a conservative monarchist, introduced workers’ health provisions in Prussia. When Asquith became British prime minister a quarter-century later, in 1908, he founded the British welfare state with pensions for the aged, and members of his government such as David Lloyd George and Winston Churchill visited Prussia to see how its system worked. Labour members numbered several dozens in that parliament, and they showed no interest whatever in such reforms. They had been elected with one purpose only: to change the laws that restricted the unions. A welfare state meant nothing to them.

Between the world wars, conservative governments widened welfare provisions, and again Labour was unimpressed. If you are trying to abolish capitalism, it makes no sense to humanize it. In 1942, at the height of World War II, William Beveridge wrote a report that led to a national health service. It corresponded to nothing in socialist policies, and the Labour leaders derided it. Beveridge has left a record of their opposition in a memoir called Power and Influence. By the 1945 general election, they had been forced to concede the principle, and all the parties, including the conservatives under Churchill’s leadership, were committed to the measure. Beveridge, who was never a socialist, lived to be shocked by the readiness of Labour leaders to take credit for national health. Above all, he hated the phrase “socialized medicine” as inaccurate and tendentious, and the contributory health scheme that Britain has enjoyed since 1948 always left room for a large and growing private sector.

In Europe at large, similarly, there is no historical connection between socialism and social welfare. By the 1950’s, France, Germany, and Benelux, under religious coalitions, had more extensive welfare provisions than Britain after six years of Labour; and when the two Germanys became one in 1990-91, it was discovered that the welfare provision of the capitalist West was at least twice that of the socialist East. Socialism was stingy. For one thing, it was incapable of creating the wealth that high welfare spending demands. For another, its ruling elites were more interested in lining their own pockets. Now the story is out. In February 1991, Todor Zhivkov, the former communist dictator of Bulgaria, cheerfully admitted at his trial in Sofia that his huge gifts to friends and relatives were normal before the Soviet collapse. “This was the situation in all socialist countries.” He was right. Any centralized economy is a honeypot, especially in a one-party state, and you sweeten your friends out of the public purse.

That is a paradox still to be digested. On a long view, extravagant welfare spending seems to be an aberration of capitalism. New York City has been close to bankruptcy for no less a reason, and no one doubts that New York is capitalist. When I first knew California, in the flourishing days of the 1960’s, it offered a wide-open access to higher education, unknown in any socialist state on earth, called the University of California. Or consider this contrast from a grimmer age. In the early 1930’s, at the depth of the Depression, America had soup kitchens while Ukrainian peasants starved to death. A soup kitchen may not be much, but it is better than dying in the fields.

So whether you look to the top or the bottom of the scale, capitalism is more generous than socialism. The phenomenon seems to be general, and it is still to be observed in the two Koreas or the two Chinas. To be sure, capitalism has more to be generous with. But no one should discount the possibility that a free market is more generous than a state economy by its nature. It offers its people a chance to prosper, which is itself a generous instinct, whatever the outcome. If it is a democracy, it carries within it a powerful motive to let no one starve, since elections are not won on famine. Socialism, by contrast, offers monopoly ruled by an elite which, if you are lucky, dispenses favors to those who are not too proud to beg for them.

Nonetheless, the egg has been well and truly wiped from the face, and surprisingly few ex-socialists are ashamed of themselves. “Have you never believed in Father Christmas?” Danis Healey remarked, when asked why he had been an active member of the Communist Party as an Oxford student before the war. He later became deputy leader of the Labour Party and is now a member of the House of Lords, so communists can come a long way. On the other hand. Lord Healey has an interesting point. When you are young, you see politics as a moral drama, and fall in love with what Michael Foot, another Labour leader, has called the politics of paradise. Later you come to see it for what it is: a clutch of difficult, even intractable problems like Kosovo or Ulster.

The point needs to be pushed further home. When you are young you do not know much, and that helps a lot when you are asked to accept that socialism favors the poor. You probably do not know that socialism once starved millions in the Ukraine. You probably do not know that conservatives and liberals, not socialists, pioneered the welfare state, at a time when socialists were indifferent or hostile. Where, in the writings of Marx and Engels, do you find any proposal for a national health service? Still less do you know that socialism means rule by an elite, and that Marx and Lenin openly conceded that it did. You have neither read much nor seen much. And if you were at Oxford, you may not even have heard of the University of California. So there are times when ignorance helps. Sometimes it is the only thing that does.