Socialism: Utopian and Scientific is a short, argumentative pamphlet, drawn by Engels from his longer work against Dühring. Its purpose is to separate two kinds of socialism: the early reforming systems he calls utopian, and the historical and economic account he calls scientific. The whole essay is built to show why the second supersedes the first.
Engels begins with the great utopians, Saint-Simon, Fourier, and Owen. He honors their criticism of bourgeois society and the germs of thought in their writing, but he locates their limit in their method. They appealed to reason and eternal justice, treated the discovery of the right system as a happy accident of genius, and tried to impose model arrangements on society from without. Because the economic conditions for change were still undeveloped, their solutions had to be spun out of the human brain, and were foredoomed to drift into phantasy.
The turn to a scientific socialism rests, for Engels, on two intellectual recoveries. The first is dialectics, revived in German philosophy and culminating in Hegel, which views the world as process, motion, and development rather than fixed things. The second is materialism, freed from the mechanical materialism of the eighteenth century. Setting Hegel's dialectic on a material basis yields the materialist conception of history: the proposition that the production and exchange of the means of life is the basis of all social structure, and that the final causes of social change lie in economics rather than in philosophy.
On this basis Engels presents two discoveries he attributes to Marx: the materialist conception of history, and the revelation of surplus value. Past history, apart from its earliest stages, becomes the history of class struggles rooted in economic interests, and capitalist exploitation is explained rather than merely denounced. With these, Engels says, socialism became a science whose task is to study the historical and economic succession that produced the proletariat and bourgeoisie, and to find in those conditions the means of ending the conflict.
The closing argument traces capitalism's central contradiction. Production has become social and organized within the firm, yet appropriation and exchange remain private and unplanned, so society lurches through recurring crises in which abundance itself becomes a source of want. Engels reads joint-stock companies, trusts, and State ownership as partial, involuntary admissions of the social character of production that do not abolish the capital relation but bring it to a head. The resolution he forecasts is the proletariat seizing political power, turning the means of production into common property, and thereby abolishing classes and itself, after which the State, no longer needed to hold a class down, is not abolished by decree but dies out.