Communism works great at small scales. Within friend groups and up to the village level, informal communism is a tried and true social mechanism. I suppose that's also part of the appeal: We know it works on small scales, we just don't know how to scale it up in a robust way.

Unfortunately, there's a limit to how many people we can have actual meaningful connections to and as the number of people we don't care about grows, the emotional resistance to screwing over everyone shrinks. It also doesn't help that fair and equitable resource allocation for millions of people is a difficult problem. At the state level it becomes pretty hard to uphold a truly communist system.

Also, of course, sooner or later sociopaths will come along and subvert the whole damn thing, which works even better if you're in the (intended to be) transitional phase where the state owns everything. To be fair, sociopaths will try to subvert any system and are usually successful; authoritarian socialism just happens to offer a relatively convenient way to do so.

And the polar opposite of unrestrained capitalism is also terrible, just at a slightly slower pace. If wealth is power and wealth tends to consolidate without outside influence, any naive capitalist system will ultimately collapse to virtually the same degenerate state as naive communism, just with a slightly different flavor of sociopath at the helm and people screwing each other over for slightly different reasons.

As usual, the best approach is probably a boring compromise that nobody gets truly excited about. See what other societies are doing, try to adapt what works, avoid what doesn't, and continually rebalance your system to handle changing conditions. Also, plan ahead and live with the fact that your policies will never be ideal now because they're trying to prevent bad outcomes later. But that's the political equivalent of beige; you're not getting people to form a fervent pragmatic compromise movement.