Socialists just seized the commanding heights of New York City.

On Tuesday night, Zohran Mamdani — a longtime member of the Democratic Socialists of America (DSA) — won the mayoralty of America’s largest municipality.

Mamdani’s election constitutes a triumph for America’s long-suffering socialist movement — possibly, the most significant in its history.

His victory may therefore lead some Americans to ask the question: What do these people actually want?

Or, more specifically: How do they think “democratic socialism” would work, in practice? Do Mamdani and his allies want to make America into Norway — or into a kinder, gentler Soviet Union?

These questions have no single answer. Pose them to two socialists and you’ll get three opinions. But Bhaskar Sunkara, founder of the socialist magazine Jacobin, has sketched one of his movement’s clearest blueprints for a democratic socialist society. And he will soon publish a more detailed account of that vision, which he calls “market socialism,” in a book coauthored with his colleagues Ben Burgis and Mike Beggs.

To better understand this vision of market socialism — and see how well it holds up under scrutiny — I spoke with Sunkara this week. We also discussed Mamdani’s victory and what Democrats can (or can’t) learn from it. Our conversation has been edited for clarity and length.

**What’s your understanding of how Mamdani won? **

He ran a campaign that was laser-focused on issues of affordability, at a time when New York City is in an affordability crisis. The rest of the country is seeing real wage increases and New Yorkers are not. Obviously, the main cause of that is the ridiculous price of housing in the city, but there are other causes as well.

The campaign had a Bernie Sanders 2016 vibe. People would go to his rallies and he would just say, “freeze the ____” and everyone would shout “rent!” There was a level of repetition that the left learned from the Sanders campaign.

And that’s just good politics. The Mamdani platform can fit on the back of a business card. By contrast, certain Democratic Party politicians seem to have a different white paper for every little segmented group.

And then, he’s handsome, he’s a good communicator, and just dynamic. In the closing days of the campaign, he was out in Queens talking to workers on graveyard shifts. He was just campaigning with a level of ferocity that none of his opponents were. And he was running against a disgraced former governor, a mayor who has his own kind of charisma but is facing corruption allegations, and a bunch of center-left technocrats who just did not have it.

When you first imagined democratic socialists taking power in New York, is this how you pictured it? Did Zohran’s specific path to power surprise you in any way?

I was surprised that Zohran won. I was definitely a supporter from the beginning. But I thought of it more as a pressure campaign — to bring cost-of-living concerns to the forefront of the race.

What really surprised me was that, in the primary, Zohran actually did the thing that Bernie Sanders tried and failed to do in his presidential campaigns; he mobilized groups of people who were previously not voting in these low-turnout primaries. He mobilized young people, he mobilized some immigrant non-voters. In general, I’ve been critical of this mobilizational theory of politics: The idea that the left can win mostly by virtue of being more left-wing, putting forward the right set of demands and activating a public that doesn’t already exist. But in this case, it happened.

Many have framed Mamdani’s victory as proof that the left has a model of politics that can defeat the right nationally.

Skeptics, however, say that this overstates what Mamdani actually achieved: The Democratic Party already knew how to win mayoral elections in New York City. Just because democratic socialism can defeat Andrew Cuomo in a blue city doesn’t mean it can win swing states.

I think Zohran shows that democratic socialism can actually win and energize people in many parts of the country, particularly in deep blue districts.

It’s also true that socialism may be a liability in places that aren’t like New York City. We also need figures like Dan Osborn.

**The populist, independent Senate candidate who ran a strong (but losing) campaign in Nebraska last year. **

Right. We need candidates like that who can translate populist economic messaging to a very “red” part of the country.

And in many ways, Mamdani and Osborn are different expressions of the same set of egalitarian politics — a politics that seeks to create a fairer deal for working-class people. Obviously, they have different stances on social issues, they have different affects, they have different backgrounds. But fundamentally, I think that their campaigns rested on the same basic message about economic dignity and corporate accountability.

A centrist might argue that you’re misconstruing the roots of Osborn’s success. Yes, he used populist rhetoric and spoke to cost-of-living concerns. And that was important.

But he also ran as the “the only real conservative” in his race, promised to help Donald Trump build his wall, and attacked his Republican opponent for supporting Joe Biden’s bipartisan infrastructure bill,**** arguing that investment in such basic public goods was wasteful and that we needed to cut the budget.

**And if you look at other Democrats who perform well in swing districts or red states, they tend to engage in that kind of moderation. **

So, how do we know that Mamdani’s specific model — emphasizing a robustly egalitarian message on economics while largely upholding progressive orthodoxy on social issues — is a viable formula nationally?

Candidates will need to find different vocabularies and points of emphasis in different places, ones that are true to both their values and those of their voters. Mamdani and Osborn are both popular, to a large degree, because they show what an alternative economic populist path looks like. But for that message to get through in Nebraska, you need to work with the electorate you have, not the one you might wish you had.

**All right. We’ve talked enough about trifling subjects like how to win mayoral races or congressional elections. Let’s talk about seizing the means of production. **

You are a proponent of “market socialism.” To many, that may sound like a contradiction in terms. Historically, socialism has been associated with the ambition to cease allocating resources through markets and begin doing so through central planning. So, why do you think that even a socialist utopia would want to preserve the market economy?

The market in and of itself isn’t capitalism. Capitalism is a system where firms hire wage labor to produce for profit, extracting surplus value and reinvesting it to expand their capital.

In my vision, a socialist society would retain markets as tools for coordination and consumer choice. But the firms operating in these markets would be run by worker cooperatives that are funded by public banks.

The reason why I’ve come to embrace markets is just by looking at the actual practice of central planning under socialism.

In any system, society still has to decide what to produce, how much, and for whom. Central planning attempted to answer these questions administratively. But planners lacked the information necessary to rationally allocate goods. And they also faced severe incentive and agency problems — managers had little reason to report results honestly or innovate when the survival of their firms didn’t depend on efficiency.

Why do you think some socialists nevertheless retain an aversion to markets?

Part of the problem is that, in today’s economy, there’s massive inequality. In the market, $1 amounts to one vote on what society is going to produce. Well, in our society, the most essential and hardworking people — those who take out our trash and provide other vital social functions — earn barely anything compared to the super rich. So, markets favor the latter’s preferences over the former’s.

But in a society with greater equality — including the end of wage labor and stronger social protections — markets could look very different. Saying, “Hey, I worked this much and earned an income of $100, and it’s up to me how I want to spend this money” makes a lot more sense than deciding democratically how you get to spend your $100.

In any case, given the experience of the 20th century, the burden of proof is really on people who think that there’s an alternative to markets as a coordination mechanism.

**But you believe there *****is ***an alternative to capitalism, as a system for organizing market production?

Yes. The problem with capitalism is, first, distributional: It allows poverty amid plenty and gross, unnecessary levels of income equality.

And then there is also a democratic problem: the fact that our workplaces are run as quasi-dictatorships, especially in non-unionized sectors. And it’s my view that workers can democratically elect management and run their workplaces in a different way. And that’s why I’m a socialist.

**A liberal might question your analogy between capitalist firms and dictatorships. After all, a dictatorial state wields the power of life and death over its subjects. And its citizens often can’t legally escape its control. **

**By contrast, in liberal capitalist societies, firms are voluntary organizations. These institutions cannot kill or imprison their employees. And all workers have the legal right to refuse employment at a hierarchically organized enterprise. **

**Of course, in our world, workers may not always be capable of exercising that right. There isn’t always another job available or alternative way to feed your family. But in principle, one could imagine a society with a general welfare state — and full employment — where workers can comfortably quit any job they don’t like. **

**Why then, in our ideal society, should we forbid people from forming economic enterprises that are internally governed in a non-democratic manner? After all, we’re presumably going to let people form religious and civic organizations that are not internally democratic, unless your socialist vision entails the criminalization of Catholicism. **

I understand the liberal intuition there — that if people are free to leave their jobs, then they’re not really unfree. First of all, it’s true that we’re not living under feudalism. But I think that’s a very thin conception of freedom. Under capitalism, workers have “exit” without “voice.” They can quit, but they can’t meaningfully shape the conditions of their work under ordinary conditions. For many people, exit isn’t a genuine exercise of autonomy, but a threat you make when you’re desperate.

Democracy at work is about extending the same principle we apply in politics: we don’t say people are free because they can leave their home country; we say they’re free because they have a say in how it’s governed.

Would democratically managing firms make them less efficient — and thus, ultimately, less beneficial for society? One concern might be that if managers ultimately need to worry about winning reelection, they will be reluctant to fire workers for bad performance. Or they might hesitate to invest in labor-saving machinery that might increase the firm’s productivity — and reduce costs for consumers — but threaten workers’ job stability.

It’s true that any successor system to capitalism has to be at least as efficient at coordinating the division of labor. Socialism that can’t deliver innovation and rising living standards isn’t going to be legitimate or durable. But I don’t think we should assume that efficiency and democracy are at odds.

There are reasons to think that market socialism could actually be more dynamic. Workers at labor-managed enterprises are often more motivated to share information and better positioned to identify improvements than they are now. Firms would still compete in markets, so inefficiency would be disciplined by failure.

I also don’t think democratic firms would avoid labor-saving technology. They’d still have to compete in markets and cover their costs, so productivity gains would remain in their interest. The difference is that the benefits of those gains would be shared among the people who created them.

So, in those markets, how are you replacing the functions that are currently fulfilled by capitalists? In our world, investors are primarily responsible for identifying promising enterprises. And they often force the shutdown of inefficient ones, freeing up capital for more productive businesses. So, how does your system function without capitalists?

In a market socialist system, you need public banks that can support worker-controlled firms, and provide them with startup capital. And they’re doing that on the same basis as a bank would under capitalism — they are trying to give money to firms that they believe will be profitable and will pay back their loans.

As far as closing down inefficient firms, one of the greatest failures of socialism in the 20th century is what economists have called “soft budget constraints.” In a state socialist system, it would often be apparent that some firms were very inefficient, but it would be impossible to shut them down for a variety of reasons.

Partly, this was because of political dynamics: Authoritarian socialist societies relied on full employment as a means of legitimizing their rule. And it was politically unpopular to shut down these firms.

So, how do you resolve this? Well, the firms have hard budgets. The firms need to produce enough to cover their wage bill, cover their expenses, otherwise they’re just simply going to go out of business.

But why wouldn’t political dynamics just reproduce the “soft budget” problem again, in practice? Ultimately, these banks are public entities accountable to elected governments, which will have incentives to avoid economic disruptions.

For example: Say a public bank chokes off funding to a large, inefficient steel mill and lots of workers lose their jobs. That decision is going to be very salient to those unemployed steel workers. And those workers could then threaten to vote against the current government unless it intervenes and reverses the bank’s decision.

**Meanwhile, it’s unlikely that other voters would mobilize in support of shutting down the mill. It might be in the long-term interest of virtually all workers for capital to be efficiently allocated. But the immediate benefit of closing any one firm is small, diffuse, and essentially invisible to ordinary people. **

We see these dynamics at play in the real world. When economic decisions become politicized, governments routinely pursue policies that benefit well-organized interest groups, at the expense of the broader populace. To many liberals, this is why we need private investors; their insulation from the political process enables them to impose hard budgets and thus, allocate capital efficiently.

**Or, to put a finer point on the argument: the reason why socialism has historically failed isn’t due to some contingent design failure. It’s that bringing *****all *****investment under the purview of state institutions inevitably leads to inefficiency. **

That’s a legitimate worry, but the tendency for politicians to shield failing firms from closure isn’t unique to socialism. We see versions of the same “soft budget” behavior under capitalism all the time.

The real question is how to manage it. In a socialist framework, public banks would need to operate with clear rules and genuine operational autonomy.

Political pressure to prop up firms can also be mitigated through social policy. If workers know that job loss doesn’t mean destitution — because there are strong safety nets and active labor-market programs that quickly reconnect people to work — then firm failure becomes more tolerable. People don’t have to fear it, and governments don’t have to panic over it.

**Perhaps, the most common argument against socialism is that it erodes incentives to perform economically valuable work. **

**If we want to have brain surgeons, we need some people to dedicate many years of their lives to the diligent study of medicine. In our society, we motivate that effort by awarding brain surgeons with higher levels of compensation than the typical worker. **

Likewise, if we want innovative businesses, we need people who are willing to take entrepreneurial risks. And we encourage people to take those risks by providing huge returns to successful businesses.

**It sounds to me like you want to retain these incentives under market socialism. But how do you accomplish that without recreating the inequality that motivates your opposition to capitalism in the first place? **

We should absolutely be paying people more to incentivize them to go into jobs like brain surgery. And someone who helps create a great new product or firm should get certain windfall benefits.

To me, there’s a difference between getting paid more so that you can consume more, and getting paid so much that you have more power over other people, in a less justifiable way.

Bill Ackman, the billionaire, is so unpopular that his opposition may have actually helped Mamdani. But he threw millions of dollars into the New York City election to sway ordinary working-class New Yorkers — who are as politically passionate as Bill Ackman, but have no way to influence the election except with their votes or maybe a little spare time to canvass.

That’s income actually influencing power.

And this also happens when a super-rich capitalist is unhappy with government policy and therefore decides that they’re going to go on capital strike: They’re going to stop investing to punish the government.

That creates the type of power disparities that socialists are concerned about. We’re much less concerned about the fact that Shohei Ohtani is paid more than us (Ohtani is underpaid, by the way).

**So, there can be inequality but we’re capping its extent: Past a certain point, we can’t allow individuals to accrue more wealth because it will give them too much power. **

**In practice, doesn’t that mean that we are eliminating certain entrepreneurs’ incentives to start new businesses, once they’ve already had enough success to hit the maximum wealth threshold? Like, if you helped create one $100 billion business, you’re probably not going to be allowed to earn much more income or wealth from a new enterprise. **

I don’t think it’s about an absolute wealth cap so much as limiting what wealth does — making sure it doesn’t translate into undemocratic power, whether in politics or in the workplace.

So there’s no hard threshold for income accumulation in the abstract. But if you’re drawing an outsized share, it has to reflect real value creation for your firm and its members. Those disparities need to be functional, meaning you need to be producing better outcomes for workers, managers, and the enterprise as a whole, not just getting rewards for ownership alone.

In trying to imagine a functional socialism, you’ve made peace with many things that leftists have historically disdained about capitalism — inequality, unemployment, the profit motive. In your view, socialist societies tried to dispense with these features of market capitalism, only to discover their practical necessity.

**Some might say: Why risk making the same mistake with private capital markets? **

After all, we already have a model for a market economy in which inequality is constrained, workers enjoy protection against exploitation in the workplace, the state provides myriad public goods, and welfare programs ensure everyone enjoys a decent standard of living: It’s called social democracy.

And unlike market socialism, we know that social democracy actually works. Denmark, Norway, and Sweden exist.

So, why not stick to what we know? Why risk the possibility that abolishing capital markets will actually sap economic dynamism and promote authoritarianism, like many of the socialist movement’s past attempts to discard core institutions of industrial modernity?

At a normative level, I’m a democratic socialist because I think there’s something objectionable about capitalism. It’s hard for me to imagine a society that meets my egalitarian goals if we have a class of people who own production and a class of people who have nothing to give but their labor.

Now, why should someone pursue democratic socialism, even if they think social democracy is egalitarian enough? I think that’s a reasonable question. Many of the mechanisms we’ve talked about — public investment, democratic firms, a big welfare state, more equal distribution of income — sound like extensions of social democracy. And that’s no surprise — they emerge from a lot of the same impulses.

But in my reading of history, social democracies always run up against capitalist power.

Social democracy creates doses of socialism within capitalism. But ultimately, private investors still control the means of production and the means of investment. They can choose not to invest if they don’t like government policies; if they feel like taxes are getting too high, there’s too much labor protection, there’s too much public competition. And that’s happened repeatedly throughout history.

These capital strikes don’t require capitalists to all conspire in a smoke-filled room together. It’s really built into the logic of investment under capitalism — when business confidence wavers, capital can just basically say, “Listen, we’re not investing, it’s not worth it for us.” And ultimately, at that point, social democratic parties always have to dial things back and restore conditions of profitability.

To have a functioning society — that’s rich enough to sustain a welfare state and all these other good things — you need productivity, you need firms producing things, you need certain economic fundamentals. But you don’t need capitalists having a veto over the kind of society we can build.