Simple guide to socialism

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I'm a little out of the loop, why is a social democratic welfare state not socialism?
- Because a welfare state is irrelevant to worker controlled/owned means of production and worker ownership is the defining characteristic of socialism.
  A welfare state is just a welfare state.
  
  But a welfare state is an indication that the state is owned by the people who work in it therefor worker ownership of means of production.
- Social democratic welfare states re-distribute some of the surplus value extracted from the labor of workers back to them, but the fundamental functioning of the economy remains decision-making in firms owned and run by capitalist investors rather than workers.
  
  That's fair, but if the workers regulate the companies, control supply via subsidies and taxation, and cap the wealth of the investors then doesn't it have the exact same effect as if a government office made all the business decisions while also allotting the freedom of the workers to create or retire businesses?
  Pretty big but, though, I admit it would be asking a lot to accomplish that from the perspective of the world we live in.
  
  No it's not the same, it's a totally different system as long as the labor doesn't own the business they work for. Ten thousand different mechanisms to circumvent the ownership by private capital is still ownership by private capital and as America has demonstrated again and again, no battle is won by a vague circumventing of the major problem of exploitation, because all those mechanisms are quickly and easily removed by private capital the second they buy enough power to do so. Our entire economy is monopolizing at an alarming rate, this was illegal just a few decades ago, it's now legal to hand politicians millions of dollars to do what they are told, this was illegal before Citizens United decision, also legal to bribe then to do your bidding openly as long as you only give them the money after they accomplish your task, and now unions are difficult to start and maintain this was a legally protected activity a few decades ago, all the circumventing is temporary and inefficient.
  
  If we're moving on from hypotheticals then it seems like welfare state approaches were far more effective when put into practice than things like the USSR.
  
  Yeah for a while the work tax credit and child tax credit was my main income It paid more than my job, and a lot of corporate stock trade types like Warren Buffet advocated that was the solution to the capitalist problem of long term income stagnation and inequality, but it's not around anyone, I can't expect it to work after any election, and it is easy to lose it every four years. It doesn't work not because of the factual outcome, it doesn't work because it's temporary and under constant attack. Unless we get laws that can't be ended or argued without a very high majority of the legislator AND the states, can't be thrown out by a renegade supreme court, or hand waved by executive orders, then it's not worth the paper it's printed on.
  
  Every solution is always going to be under constant attack.
  
  That’s fair, but if the workers regulate the companies, control supply via subsidies and taxation, and cap the wealth of the investors then doesn’t it have the exact same effect as if a government office made all the business decisions while also allotting the freedom of the workers to create or retire businesses?
  Not really - I feel like I should address this in parts, though it's all one statement and I feel like it needed to be denied as a whole statement first.
  That’s fair, but if the workers regulate the companies, control supply via subsidies and taxation, and cap the wealth of the investors
  This is the ideal functioning of a social democratic welfare state. We... do not really have a fully ideally functioning social democratic welfare state right now (speaking even outside of the US, because we're pretty fucked here), but this is a fundamentally good, or at least better, goal to aim for than our current situation.
  then doesn’t it have the exact same effect as if a government office made all the business decisions
  No, it does not. What you've proposed, as a social democratic welfare state, results in a government which restricts and encourages economic decisions which it believes will be in the best interest of the workers. The final decision-making power resides with independent firms mostly run by capitalist investors, even if their decisions are restricted by regulations, and invariably, the decision made within those restrictions will be the one which most benefits (or which the investors perceive as most-benefitting) the capitalist investors, not the workers, and not the firm.
  What you describe is probably most comparable to French dirigisme
  while also allotting the freedom of the workers to create or retire businesses?
  This is a common misconception about socialism, or at least many forms of socialism. Under socialism, a worker running a business is not necessarily restricted - what is restricted is who, beyond the worker, can create or retire a business.
  Under the loosest definition of socialism, or, if one prefers the more stringent definition of socialism as beyond simply modernist anti-capitalism, under generally anti-capitalist ideals, there is nothing preventing a worker from starting a business and selling their labor.
  Where things get fuzzy is ownership of capital. The strictest socialists would say that all ownership of capital is anti-socialist - down to tools being communally shared. This is an extreme position, however. Most socialists accept that some amount of workers owning the tools they themselves use (or, for some who are insistent about ownership being verboten, workers having 'exclusive rights to dictate the usage of their tools as long as the tools are in use by them') is acceptable - what is important is that capital is not a tool to leverage control over others, but a tool to enable one's own labor.
  At its absolute loosest, a generalized anti-capitalism, a worker would be able to run a business, hire workers, buy and sell capital on behalf of the firm, etc, in a mostly recognizable way, even if his work was done on what we might regard as an executive level. The difference would be that the capital would belong to the firm he ran - the worker could not simply cash out and leave the other workers high and dry because it's 'his' business. Nor would there be outside non-worker investors.
  This is considered by many socialists to be insufficient to qualify as socialism, and many would insist further that a firm must include workers as a fundamental and major part of the decision-making process to be socialists - but even then, again, nothing in most of these conceptions stops a worker from starting a business and hiring workers. It's simply that once other workers are involved, they must be involved in decision-making, in some form - whether by electing who runs the firm, or by worker-investor schemes, or by votes on major decisions.
  There are a lot of conceptions of socialism out there, and a lot of different proposals for what we should be working for. About the only point of agreement is that capitalism is not the way forward - that investor-driven market economies have results which follow the iron law of institutions - decisions benefit the decision-makers, not the firms, and certainly not the workers.
  
  This is a common misconception about socialism, or at least many forms of socialism. Under socialism, a worker running a business is not necessarily restricted - what is restricted is who, beyond the worker, can create or retire a business.
  That statement doesn't really parse. They're either able to create a business or they are not. They're either able to put goods onto an exchange market or fill requests even beyond or far below requested amounts, or they're not. You will absolutely have people who start a business and make others do the work so long as the government does not directly manage the business, unless you completely disregard human nature which was already stretched pretty thin in the assumption that a worker owned government and by extension means of production were incorruptible.
  
  That statement doesn’t really parse. They’re either able to create a business or they are not. They’re either able to put goods onto an exchange market or fill requests even beyond or far below requested amounts, or they’re not.
  I think you're misreading the statement. The statement is trying to say that workers can create businesses. In start-up businesses, there very often (though not always) is no difference between the founders and the workers - and management work is work, mind you.
  You will absolutely have people who start a business and make others do the work so long as the government does not directly manage the business,
  That's just the thing - as mentioned here, the two, broadly speaking, ways that socialism addresses this would be either:
  The worker who started the firm does not have private ownership of the firm's capital (and there are no outside investors which have ownership or part-ownership of the firm's capital); if he is the only worker, the difference is purely formal, but if he is not the only worker, he does not have the right to, say, sell everything the firm has and take the proceeds to his bank account, the way a modern private company could. The worker who started the firm, in this case, would be in a position akin to a public corporation in which the executive(s) must answer to shareholders for financial decisions - only instead of shareholders, it's the firm's workers. Even if he sold the firm's capital, the firm itself would still own the proceeds of the sales, and he could not simply regard it as 'his' and write it down on his personal income tax form as liquidation of capital gains.
  The worker who started the firm does not have exclusive executive control over the firm unless he is the only worker in the firm.
  unless you completely disregard human nature which was already stretched pretty thin in the assumption that a worker owned government were incorruptible.
  It's not about corruption. Corruption isn't even in the conversation here.

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