The absorbing biography of George Bernard Shaw (1856-1950) by Michael Holroyd, which lay in my library since 1988 among my books on political theory, has opened my eyes to the dangers of what I call “creeping socialism.” This is a species of soft collectivism that was born at the end of the 19th century, lay half dormant during the interwar years, flowered under the guise of the welfare state and social democracy after World War II, and is now rampant in the 21st century. The real nature of this far from innocuous infection was hidden to western eyes by the dreadful experiments in ‘real’ socialism, stated in earnest by Lenin and Stalin in the Soviet Union, Mussolini in Italy, Hitler in Germany, and Mao in China. With the end of the colonial era, real socialism morphed into planned socialism in India, Latin America, and Africa. But all the while, the soft collectivism personified by Shaw and his Fabian companions in Britain and paralleled by Social Democracy in Sweden and American liberalism in the United States, spread almost unnoticed in the advanced democracies and is making a comeback in the Great Recession years of the present century.

An abridged version of Michael Holroyd’s Shaw biography is available at Bernard Shaw: The One-Volume Definitive Edition. For more on Robert Skidelsky’s work, see DeLong on Skidelsky on Keynes by David R. Henderson on EconLog. See also Robert Skidelsky on Money, the Good Life, and How Much is Enough and Capitalism, Government, and the Good Society on EconTalk.

I am very partial to Anglo-Saxon biographies (as we call them in my part of the world). Given the decline and fall of the historical novel from the heights of Tolstoy’s War and Peace or Graves’s I, Claudius, I now much prefer the combination of empathy and fact in solid biographical portraits. Biographers face a more difficult task than do novelists: they must reconstruct the personality of their characters, make them live on the page rounded and full bodied, warts and all—but ground their tale on authentic documents so that historical truth is respected. The biographer must be governed by empathy rather than fantasy. He must also conscientiously recreate the times and places where his story unfolds. As an outstanding example let me recall Lord Robert Skidelsky’s John Maynard Keynes,1 in which the complex personality of his hero and the quickly changing circumstances of the first half of the 20th century are portrayed in careful detail. The only trouble with present day biographies is that they usually run to three tomes; Skidelsky’s Keynes is in three volumes. So was Holroyd’s Shaw, plus a booklet on the ructions around the testaments of Shaw and his wife Charlotte. Still, I found Holroyd a great read, especially for the portrait of the mercurial, intelligent, gifted, unrealistic Shaw and for the analysis of the Fabian Society, both specimens of what it meant to be a socialist before WWI, in Victorian and Edwardian times.

My view of Shaw was out of focus. I had heard of his vegetarianism, of his cycling prowess, of his championing of Wagner, though I wrongly thought he knew no music. I had also heard of his mariage blanc and had laughed at tales of his many witty remarks. In sum, I saw him as a sarcastic rationalist lacking in human emotion. My view was incomplete if not downright wrong. When I first came to England as a young student in 1952, he had just died and a battle was being waged over his will. I read him avidly to start understanding that strange country—a straitened but benevolent society, on a path towards generous social welfare that the Conservatives then back in power would not abandon. Shaw’s plays I loved for their common-sense philosophy and sharp humour; the comments on society in his prefaces and essays I found enlightening. Of course capitalism was unjust and inefficient! Naturally socialism was inevitable and to be welcomed! But the road he wanted to follow was not holistic and revolutionary but municipal and piecemeal, what Hyndman, the leader of the (revolutionary) Social Democratic Federation, derisively called “gas and water socialism” in the stormy 1880s.

Socialism and the Arts

Very early in his native Ireland, Shaw came to reject market capitalism in disgust at the squalor of the Dublin slums. His family was always on the edge of poverty, despite its roots in the respectable Protestant middle-class. At home, there was lots of music, encouraged by the continuous presence of a Svengali figure called Vandeleur Lee, a voice teacher and musical impresario who engaged Shaw’s mezzo-soprano mother and later his soprano sister in his musical ventures. Shaw did not learn music during his unhappy infancy but later heroically and virtually on his own taught himself to read it and play the piano. So, in his many years as a whimsical opera and concert critic, he built his apparently amateurish judgments on solid foundations. This side of his personality is clearly visible in his socialism: he detested the bad musical taste of the bourgeois society of his time and hoped that under socialism the working classes would acquire refined tastes and enjoy the higher pleasures of culture.

A lifelong friend of Shaw’s, William Archer, first took notice of him in the library of the British Museum when on Shaw’s desk he saw a French translation of Karl Marx‘s Kapital and the open score of Wagner’s Tristan and Isolde. Shaw soon moved away from Marx, thanks to Philip Wicksteed’s criticism of the Marxist labour theory of value. He realised that even from a socialist point of view it was wrong to maintain that the value of goods was determined by the quantity of labour expended in producing them; value depended on supply and demand and ultimately on the utility of the commodity for the consumer. From this Shaw concluded that socialists should not see society as divided into the working class producers of value on the one hand and their capitalist exploiters on the other. The division in society was between producers of all classes and the idle rich who unduly appropriated land rents and the interest of capital. If land and capital were appropriated by the state, their rent would be enough to lift the labouring poor from destitution and ignorance. “Socialism is and always had been an attack on idleness,” he concluded.

Shaw at the Fabian Society

Thus freed from the influence of Marx, he felt able to join the recently created Fabian Society (1885). He there was lucky to befriend Sidney Webb (1859-1947), with whom he would work in tandem for many years. Webb, a number crunching civil servant, was the very opposite of Shaw in character and attainments. Where Shaw had a lightning brain, entrancing delivery, and masterly pen, Webb was a memoriser of statistics, an inaudible speaker, and a leaden prose writer. Also, Shaw was an out-and-out individualist; Webb a collectivist. However, they formed a potent pair. How could an individualist like Shaw swear by the collectivism of his friend and his equally potent wife, Beatrice Webb (1858-1943)? The three of them saw capitalism as a wasteful and anarchic system. A socialist country would be marked by efficiency and order. It is true that for Shaw the aim was wider than efficient collective administration: only in a Socialist society, free from the curse of the market, would people have the education and time to cultivate the arts; and only in a socialist society would working class men and all women be free from the straightjacket of Victorian conformity and able to fulfil their personal capacities. The order and efficiency dimension of his vision he got from Webb, with the latter’s intimate knowledge of the social conditions of the people of England.

The Manifesto2 of the Fabian Society came from Shaw’s pen. It is a two-page tract lamenting the social situation of England in 1885 and demanding profound change. “Under existing circumstances wealth cannot be enjoyed without dishonour, or foregone without misery,” it started. Mal-cultivation “makes the Nationalisation of land in some form […] a public duty.” Capitalism falsely pretends to encourage invention and does not share its benefits fairly. Competition forces national industry to reduce quality, deal dishonestly, and organise inhumanely. The state should compete vigorously with private industry and renounce all public monopolies, such as the Royal Post. Aristocratic privilege would disappear, gender equality be established, education publicly financed, and state institutions would take unhappy children from their incompetent families (he had been one such). He concluded:

That the Established Government has no more right to call itself the State than the smoke of London calls itself the weather.

That we had rather face a Civil War than such another century of suffering than the present one has been.

The call for a Civil War became rather muted after the Local Government Act of 1888 allowed the Fabians to take part in the government of the London County Council, and in that of the different Town Halls. Shaw served as a municipal counsellor for his vestry for as much as six years.

Shaw was an active Fabian for a considerable time, writing Tracts for the Society, lecturing in and around London, trying to change the conduct of affairs of his town-hall. He had also embarked on an unconventional but in the end successful career in the theatre, writing plays with which he tried to change the mores of Victorian society. He proposed the ideal of the New Woman, according to Henrik Ibsen, tried to demolish the marriage and divorce laws, traduced vivisection in consonance with his vegetarianism, and dismantled the heroics of war. On the personal side those years were also full of drama, not least in his many simultaneous flirtations and love affairs.

Shaw’s contributions stand out for their originality amid a great flurry of penny pamphlets demanding the municipalisation of milk supply, pawnshops, slaughter houses, fire insurance and whatnot. Thus, his Tract number 107 was titled Socialism for Millionaires (1901)3, where he commiserated with the very rich because they could not manage to spend their money on themselves as they had everything they could wish. Another one of Shaw’s was Fabianism and the Empire (1900), written on the occasion of the Boer war, which split the Fabians. Surprisingly, Shaw became an imperialist. He detested that and all wars, but that disgraceful conflict could be redeemed if it led the British to administer the Empire for the good of the whole of humanity. Also, in a letter at the time of publication he wrote: “As for me, I delight in the war more and more. […] It has put fourpence on the Income Tax which will never come off if the Fabians can help it; so that Old Age Pensions will be within reach at the end of the ten year repayment period, if not sooner”.4 State pensions came indeed at the end of ten years, with Lloyd George’s “People’s Budget”. Shaw’s imperialism was a worrisome development, since in the 1920s and ’30s the ideology of imperialism combined with the demand for social reform was the mark of Fascism and Nazism.5

Webb’s organicism

For additional writings by Shaw, Webb, and the Fabian Society, see Fabian Essays in Socialism, George Bernard Shaw, ed., Library of Economics and Liberty.

Webb, as I say, was more of a bureaucrat than Shaw. Collective government was the object of his endeavours. He wanted to do away with the disorder of the market and its crises through an efficient public administration. ‘National efficiency’ was the by-word of the New Liberals who had moved away from William Gladstone and nearer to the German model. Webb’s innumerable penny pamphlets dealt with ‘Facts’ and ‘Figures’ for London, with practical advice on the municipalisation of services, with proposals to change labour laws and institute the eight hour day. Especially revealing of his thought was his well-argued Tract number 69, The Difficulties of Individualism (1896).6

Webb argued that modern society was slowly and unwittingly moving in the direction of socialism. The laissez faire of the Manchester School was revealing itself as “an untried and nebulous utopia”. Far from fostering individual liberty, the uncontrolled scale of production brought about by the Industrial Revolution had led to a new kind of feudalism accompanied by warlike “internecine competition”. At the top of society one could see, “absolutely unproductive classes […] exercising the ownership of land and capital” and lording over “industrial slaves”. The cause of this unbalanced and unfair distribution was the effect of the (Ricardian) law of rent, where the means of production were in private property. This led to the remuneration of the toiling masses being “determined at the margin of the worst land” and the least productive capital. “The tribute of rent and interest” (he revealingly called it ‘tribute’) amounted to one third of the annual product. If land and capital were to be nationalised without compensation, there would be ample room to accommodate the needs of the great majority.

Another serious difficulty of individualism “is its inconsistency with democratic self-government”. The employment of great numbers in industry led to collective action, be it by legislation or by trade-union action. Socialism is thus “the steady expansion of representative government into the industrial sphere”. As a result of this process, the “captains of industry […] be deposed from their individual command and turned into salaried servants of the people”.

Those were Darwinian times, so Webb had to explain how society would modify the inhumane effects of the law of ‘the survival of the fittest’. For Webb, a primary duty of government was to define the plane on which it will allow the struggle for existence to be fought out by its members. Since “a society was something more than the sum of its members [and …] life and death distinguishable from those of its individual atoms,” it had to deal with competition so as to turn it collaborative rather than hostile.

Industrial democracy must […] necessarily be gradual in its development. The time may never arrive […] when individual is entirely merged in collective ownership or control, but […] every attempt to grapple with the ‘difficulties’ of our existing civilization brings us nearer to that goal.

“Over the long run [the Fabians] were improbably successful. Two World Wars changed circumstances so profoundly that their proposals became commonplace. The changes they had striven for were a reality by the middle of the 20th century. It is security before liberty everywhere and there seems to be no turning back.”

As Holroyd says, the endeavour of Webb and of the whole group of Fabians was to promote socialism ‘by permeation,’ at least in England. Their Society was a forerunner of today’s think tanks. Their group, which soon grew in membership to some 400, was guided by an ideal, that of a society where private property in land would have disappeared; where solidarity would have replaced money-grabbing; where everybody would have to work for their subsistence, where the social conventions of the middle and higher classes would be seen as sheer hypocrisy. Through the years they strove for high and progressive taxes on wealth, inheritance, and income, to pay for an all-encompassing welfare state; all this accompanied by growing paternalistic regulation. Over the long run they were improbably successful. Two World Wars changed circumstances so profoundly that their proposals became commonplace. The changes they had striven for were a reality by the middle of the 20th century. It is security before liberty everywhere and there seems to be no turning back.

The London School of Economics

For more on the London School of Economics, see Burgin on Hayek, Friedman, and the Great Persuasion and Boettke on Mises on EconTalk. For more on Socialism, see James Otteson on the End of Socialism on EconTalk and Socialism: An Economic and Sociological Analysis by Ludwig von Mises, Library of Economics and Liberty.

In 1894 an unexpected legacy made it possible for the Webbs, helped by Shaw, to set up a school dedicated to disinterested research in the social sciences. Sidney, “knowing that research inevitably led to socialist conclusions” and despite his socialist leanings, wanted to create a scientific institution rather than a propaganda set up. “Facts shall make you free” was one of Webb’s mottoes.7 So was born the London School of Economics and Political Science. Shaw had wanted to use the money to set up a sort of Working Men’s University, but Webb held firm. The first director he chose, W.A.S. Hewins, was not a Fabian but a conservative who later became an imperialist in the wake of Joseph Chamberlain.8 And the academic character of the new School opened the way for it being accepted as part of London University.

The tradition of the School that the faculty would not be of a single political conviction became ingrained. At the time of my studies at LSE in the 1960s and ’70s, the School still was ‘non-denominational’ as Webb had intended. The student body was on the left but not the faculty. In the fields of Political Science, Sociology and Economics, one need only remember the names of Lionel Robbins, F.A. Hayek, Karl Popper, Elie Kedourie, Michael Oakeshott, Maurice Cranston, Morris Ginsberg; or later Harry Johnson, Allan Walters and David Laidler (and Chicago from afar): to understand how a classical liberal like me came out of the red furnace of the LSE.

Shaw and the Webbs go off the rails

After Alexander Kerensky was toppled by Lenin, Shaw embarked on a two decade defence of the Bolsheviks and Stalinist oppression. Then, in 1931-32 he undertook a long journey into Soviet Russia, accompanied by Nancy Astor (who turned out to be much more critical of what they saw). They had a long interview with Stalin. Shaw found a “frank, friendly and humorous character [… a] combination of the priest and the man of action” (relates Holroyd), sporting “a smile in which there is no malice but also no credulity”.9 Bertrand Russell had not been so gullible when he had visited Russia in 1920-21: he regarded the Bolshevik regime with horror. Neither was Churchill taken in.

This contrasts with Shaw’s short visit to the United States in 1933 immediately after Russia. Holroyd speaks of “a life-long quarrel with the United States very much in the manner of Charles Dickens.” He heaped insults on Americans, calling them “windbags, swindlers and assassins”. He proclaimed himself “more communist than Lenin”. The Constitution was a “charter for anarchism.” In Hollywood he continued to refuse having any of his plays filmed. He denounced New York as being ruled by “private racketeers, from the humble gunman to the great financial magnate”. At the Metropolitan Opera House he gave a lecture broadcast to the nation and aimed his fire at the money-making obsession of his listeners. He contrasted America in the grip of the Depression with Soviet Russia where all “pulled through because the all pulled together”. The point is not that the insults were undeserved but that the comparison with Communist Russia indicated a hatred of the open society.

The Webbs did not perform any better. In 1932 and in 1934 Sidney and Beatrice Webb published Communism: A New Civilization? Dahrendorf points out that the query disappeared from the 2nd edition onward, after the Great Famine brought on by Stalin’s land collectivisation and after the Moscow Trials.10 Socialism in my view is always in danger of becoming a dangerous creed, especially when combined with an organic theory of society.

In the 1920s Shaw fell for Mussolini. As Holroyd relates, he took a pure pragmatic view of Il Duce. “The only question for us is whether he [Mussolini] is doing his job well enough to induce the Italian nation to accept him faute de mieux.” He even took in his stride the assassination of Giacomo Matteoti under Mussolini’s orders and the fascist invasion of Abyssinia.

Shaw’s crotchets

A natural development of socialist ideology is to fall for the temptation of constructivist social engineering, to give it its ugly name. All his life Shaw detested the ingrained division of classes in British society and made it one of the objects of his socialism to get rid of distinctions by birth and education. The radical remedies he proposed were the ones pursued by the whole Fabian movement: the nationalization of land and capital, progressive taxation, old-age pensions, the generous supply of municipal services, protection of the arts, the loosening of family bonds, the emancipation of women, and all the nostrums we have seen proposed in great detail by his friends the Webbs. To this he added in a typical rationalist fashion the teaching and use by the working classes of correct English pronunciation and spelling.

Shaw’s great gifts of intelligence and imagination, his knowledge of the ropes of the theatre, his sense of fun, and his Alice-in-Wonderland logic, allowed him to present his plan for language reform attractively and seductively in Pygmalion (1913), the most filmed of Shaw’s plays. Those of my readers who have not read it will no doubt remember My Fair Lady and the rain in Spain falling mainly on the plain. The flower-girl jumps over the class barrier when taught to speak, move, and dress like a lady. He wanted to show how artificial class barriers were and how easily overcome by proper training. Towards the end of his life, Shaw even started a campaign to simplify the spelling of English by launching a strange new alphabet and so make correct pronunciation easy. He left a large sum for that reform of the alphabet in his last will and testament. I myself unwittingly followed Shaw’s advice when learning, cultivating my clipped Queen’s English as carefully as I could, because in those early years of Elizabeth II’s reign broad vowels and regional accents (except Scottish) were not accepted in polite society. In fact, Shaw’s recipe has failed: the erosion of the class system in Britain has not come from everybody being taught good English but from society going down the proletarian path—including abundant expletives and profanities.


Skidelsky, Robert (1983, 1992, 2000): John Maynard Keynes, 3 volumes, Penguin Books.

Available online in the London School of Economics Digital Library at “A Manifesto”. Fabian Society, 1884.

Available online in the London School of Economics Digital Library at “Socialism for Millionaires”, by Bernard Shaw. Fabian Society, 1901.

Holroyd, Michael (1988): Bernard Shaw, 4 vols. Penguin Books. Volume I, page 243.

Dahrendorf, Ralf (1995): A History of the London School of Economics and Political Science. Oxford University Press, page 45.

Available online at the London School of Economics Digital Library at “The Difficulties of Individualism”, by Sidney Webb. Fabian Society, 1896.

Holroyd (1988), Volume I, page 410.

Dahrendorf, pages 11 and 69-71.

Holroyd (1988), Volume III, chapter IV, especially pages 244-5.

Dahrendorf, page 268.


*Pedro Schwartz is “Rafael del Pino” Research Professor of economics at Universidad Camilo José in Madrid. A member of the Royal Academy of Moral and Political Sciences in Madrid, he is a frequent contributor to the European media on the current financial and social scene. He currently serves as President of the Mont Pelerin Society.

For more articles by Pedro Schwartz, see the Archive.