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Why Capitalism is Good

Capitalism and socialism: the two structures that have divided the world on the future of society.
Melodramatic? Maybe. But even though this title sounds like an intro to a lackluster History channel
special, I believe it's accurate.
These systems present two very different futures for our world, and both have strong supporters and
opponents. I'm solidly a capitalist, and in this hub I will explain to the best of my ability why. (I first
explained my basis for judging societies in a hub called What to aim for in a perfect society.)
Comments are welcomed and like always will not be censored, but please do not post generic hate
and spam. Also, if you have the time, I highly recommend reading through the comments section -
there are several waves of productive, intelligent discussion there. Thanks for reading!
Definitions
To save time and prevent later confusion, I'm going to first make clear what I mean by "capitalism"
and "socialism". I've noticed a lot of label wars, and I will do my best to avoid those. Capitalists cover
quite a chunk of the right and center spectrum, including everybody from moderates to libertarians to
every-man-for-themselves money grubbers. Same for socialists; there is definitely a fair amount of
contrast between the far left and the center.
What I mean by capitalism is a free market (governed by supply and demand) and private property,
including the ownership of the means of production. What I mean by socialism is public ownership
on varying levels, but always the means of production. When you go towards the extremes, there
are of course far more differences, but my views deal with the more viable and debatable center. So
before we go further, allow to me to write a quick summary of why neither extreme works.


Why Both Extremes Fail
Like I said before, my views are comfortably in the center, the reason being that going too far to
either side will simply not work. Let's start with capitalism.
Capitalism
Capitalism, in its right-most form, is every man for himself. A capitalist society is set up so that those
who work hardest and smartest (not counting get luckiest in this explanation) get more resources -
which makes good sense, as until there are enough resources to accommodate everyone, there will
always be conflicts of interest. The only way to get more resources, after a certain extent, is to
create it, which can only be done through improving technology, like agriculture, electricity, and the
Internet. If we must divide our resources, it seems reasonable structure our system so that it
provides incentive for productivity.


However, if the power of those on top is not monitored, society will quickly grow unfair, and therefore
will not be stable, productive, or anything else I'd want a society to be. I don't think it's necessary to
delve deeply into why winner-take-all society wouldn't be very stable, so suffice to say: those who
are starving need food, so they must take the food from those who have it, but those who have it
aren't willing to give it up, so violence is the only option left for the starving (revolution!).
How would this happen? If we go to the extreme of having little or no government intervention, like
no tax (estate, income, etc.), the rich would keep getting richer. As the wealthy have more
resources, their children (even if less talented and/or hardworking) are far more likely to be on top,
which would soon halt societal progress. Without wealth distribution, those who are born poor must
remain poor. This is - for lack of a better word - bad for their happiness, as well as detrimental to all
of society on several levels (stability, for one).
As the wealthy have more influence, they have connections to politicians and appointed officials -
very dangerous in a representative democracy. The government must
represent the entire constituency, which will certainly not be the case if the wealthy own our political
processes. Votes can be manipulated through the media ($ owned), politicians can be bribed ($
owned), and the justice system will of course be skewed ($ owned).
Factor in corporations. Without regulatory interference, companies can and will quickly build up
monopolies that can drive prices far beyond the product's value, rendering the free market system of
supply-and-demand useless. Basically, products necessary for everyone will be in the control of only
a few. Without government to check them, those who are greediest and most selfish will rise highest
in society.
I believe in human goodness, but it's hard to doubt the existence of greed and avarice. As history
has proved, wealth and power can corrupt, and if some are given both without any checks on
potential abuse, I can't imagine society will last long.
Socialism
Far left socialism is no less dangerous. Though I think the socialist ideal of a worldwide and local
cooperation is good, the socialist model is not the way to do it.
The problem with the really far left model, involving equal work and equal distribution, has already
been discussed in depth by many, so I will only cover it briefly. I suppose that it once seemed like a
better alternative to capitalism-gone-wild (it prevents the wealth gap and the consequent abuse of
the $ owned government), but the society based on this model quickly collapses. Look at Communist
China, Cuba, or to a certain extent, today's Europe. Europe is still great, but the cracks are starting
to show.
The two major reasons are 1.) Socialism discourages work and effort by shifting consequences
(positive and negative) onto others. 2.) Socialism restricts freedom of the individual. I'll begin by
addressing the first.


By having a "security net" so secure that it's easier to not work than to work, nobody (well, few) will
work. In a future world of more resources, perhaps that will become possible. But we are not even
close to being there yet, and this system is unsustainable as it takes from those who would advance
society and gives to those who don't.
The entire point of a security net is to make sure those who are deserving have the ability to
exercise their potential (Note: I am aware that the ultimate point is to allow the happiness of
everyone. I mean in the sense of its function in a developing society.). Why work your hide off to
drag along those who are just kicking back? This system encourages laziness, and after a while
even those who naturally would work will stop because of their unjust load.
This problem with socialism has a solution: move towards the center. By arranging society so that
those who work harder, smarter, more creatively, and more productively are rewarded, all of society
will ultimately benefit from their advances. If a safety net is retained, and it should be, downward
spirals can be prevented and a basic standard of living can be available to all.
However, problem 2 (Socialism restricts freedom of the individual.) is not so easily solved. In fact, I
can't think of a solution at all. I believe this is socialism's fatal flaw, and it's basically the reason I am
capitalist. I will address this in detail later on, when it flows more appropriately.

Solutions in the Center
Clearly, there are problems once society leans too far in either direction. When I say I'm capitalist,
this does not mean I'm advocating a far right government that will quickly grow corrupt and unfair.
However, even though I see problems in the capitalist model, I see more flaws in the socialist one -
and those cannot be resolved except by adjust socialism so much that it becomes capitalism. The
flaws in capitalism can be addressed, but ultimately, the problems with socialism are fundamental.
Addressing Flaws in Capitalism
Let me begin with how to address the flaws in capitalism. The most prominent problem is wealth gap
and its consequential injustice (wealthy owning democratic process, lack of social ladder). This
needs to be addressed through a better wealth distribution system, to allow all individuals the
potential, regardless of circumstances they were born into, to earn the best society can offer. This
involves taxes, including income tax, sales tax (though exempting necessities like food and rent),
and especially estate tax. I think how high specifically those need to be is best left to those who
know economics better than I, so I won't give any specific opinions there.
Some seem to think that taxation of any sort is unfair; however, taxation is necessary (like
mentioned above) to prevent the wealthy and corporations from monopolizing and owning the
democratic process, which would quickly make society unjust and unproductive. The money from
taxes would go to a tight safety net preventing downward spirals and enabling upward mobility,


preventing the wealth gap from growing too large while still providing benefits for those who work
and contribute versus those who don't.
Even if we had a good wealth distribution system, however, I believe the problem would remain with
the wealthy ultimately owning the democratic process. The role of the government should be to work
without bias for the happiness of all the people, and that will not happen if a section of the population
has greater influence. The representatives in representative democracy are not infallible or
necessarily virtuous, and money can corrupt the process and consequently the society. The
government being transparent would help the problem, but over time I think money will cloud the
transparency again.
In order to work and not collapse into majority over minority, it would take a great deal of reform
(centuries perhaps) in public education and especially in culture, so I'll leave it as just food for
thought for now.
Flaws in Socialism
I'll move on to the flaws I see in socialism. I'm certainly not the first to point these out, but it doesn't
hurt to reiterate them. Let's begin with problems involving government. The most apparent problem
today is democratic government not being democratic, whether because of corrupt politicians or the
machinations by the rich. (I think that's resolvable through a great amount of time and effort, but, like
mentioned above, that's for another hub.)
But even if we assume that the democratic government is functioning as it should, fairly and (most
importantly) transparently, there is still a problem if there is no private property. This problem is that
the society will have no protection of individual rights and will denigrate into a tyranny of the majority
over the minority.
This was exactly what America's founding fathers were trying to prevent with a representative
democracy. Because the "common hordes" were "uneducated and incapable" of placing the
"correct" vote, representatives would help them along. Now, I think the "common hordes" are ready
to truly evolve into a democracy, but this would not be a good thing if the evolution was done without
safeguards. Too much power leads to abuse, whether intentionally or unintentionally; in this case, it
would be too much power in the hands of the majority. Whether a direct democracy is a good idea or
not is for another discussion (I think it's an idea that has potential in today's world.), but abolishing
private property is a terrible idea.
Clearly if the majority (with transparency, this would be effectively the same thing as the
government) would destroy individual rights if it had control over individual property. Let's leave
aside means of production for now. Simplistic example: Individual enjoys black licorice, while the
majority does not enjoy black licorice. The majority is not altruistic or doesn't understand the
individual's love of black licorice. The individual is unable to get black licorice, as the ingredients and
means of production belong to the group, and therefore the majority controls the black licorice.


For the socialist model to work, the majority has to be both altruistic and empathetic. I'm not saying
that's impossible, or that it doesn't sometimes happen. But I don't think it is a good idea to place
responsibility and consequences of individual actions onto all, as that causes 1.) lack of motivation to
work, 2.) lack of freedom, and consequently 3.) lack of happiness in the society. To do so makes the
society incredibly unstable. I can't think of a way for freedom and individual autonomy to survive in a
society where all are one, and consequences and rights are not conferred onto the individual, where
I wholeheartedly believe they belong.
Means of Production
Moving even closer to the center, the ownership of the means of production is the final thing I want
to address. My reasoning against common ownership is the same as my reasoning for individual
property. In addressing essential items, like agriculture, common ownership would give the majority
an incredible amount of leverage. Products necessary for all must be available for all, and I'm afraid
that would not happen fairly in a society that has no safeguards for individual rights.
Once society culturally evolves and more people gain an understanding of both the mechanics of the
world and also of a common goal, perhaps then we could discuss public ownership of large, national
industries, like mines and farms. But that would require a great deal of reform in public education
and government transparency, and neither of those should be rushed. The means will be everything
in creating a stable, happy society. I don't believe we are yet ready for any venture into the left. (The
above paragraph was added after several insightful comments were posted by both socialists and
capitalists.)
That's basically all I have to say for now. If you read this all the way through, thanks for sticking with
me. If you find anything unclear, please leave something in the comments.






Capitalism has some advantages:
Low rate of illiteracy;
High income per capita;
High feeding level;
Economic domination;
Control of science and technology,
Capitalism is better than socialism

Capitalism- innovation and advancement to increase wealth
definition- an economic system that relies on investment in machines and technology that are
used to increase production marketable goods. - Capitalism creates a free market system and
provide almost every service. It is meant to keep prices and quality decent. - capitalism when
properly regulated does help to keep prices,products,quality and the government in check
- it aims to promote freedom.
Capitalism Is Better

Capitalism is better because the government can transfer resources, but can not create opulent
people, and the government can not control the economy. While capitalism encourages
entrepreneurs, socialism discourages them. Socialism fails because people are not devoted to be
assiduous. Because of greed, laziness, and rules and regulations socialism fails. It also fails
because there is no equality of talent, intelligent ambition, attitude, skill, wisdom, or judgment to
collaborate.
Socialism doesn't work, simple as that.

Almost if not all socialist countries have had revolutions where there are an overwhelming
amount of poor people who are suffering. Look at the United States, before Obama got in, it
wasn't as good as it should be, but it was definitely better, and Obama is just pushing for more
socialism, which, again, doesn't work.
Capitalism is the backbone of our American system.

Socialism is a fundamentally flawed system that is in direct clash with our American ideals.
Capitalism helps the economy to grow, rewards people on their successes, and incentivizes
individuals to work hard. We need to cut taxes and create a hierarchy where those who want to
earn more money have a reasonable pathway to do so. All of these socialist programs and
proposals suggested by the president are absolutely "malarkey", to say the least.
Absolutely

Anyone questioning the economic benefits of capitalism is forgetting a country called the USA.
Free market capitalism has made us what we are today. Democrats falsely accuse capitalists of
"throwing granny off of the cliff" and bullcrap statements suggesting we advocate the abrogation
of the non elite. This is just not true. We believe in promoting the free market the american
dream possible. This helps everyone. Socialism kills economies, and makes people stay where
they are financially


This house believes that capitalism is better than socialism

The 20th century has been marked by fierce debates challenging or justifying the validity of
capitalism; world powers have disagreed and still disagree about the benefits and drawbacks of
the system and the dispute's considerable consequences can amongst others be felt through the
relics of the cold war4/5. According to many the question was settled with the dismantlement of
the Soviet Union in the late 1980's, it ostensibly seemed that the capitalist system had proven its
victory over socialism when compared to the economic failures and horrors of the former Soviet
countries6. However, despite a dip in interest during the late 80's and 90's, the debate has not
lost its relevance and was vividly revived with the 2008 financial crisis; due to the crisis' severe
consequences of mass-unemployment there was a renewed urge in questioning the validity of
the western capitalist economic system
This house believes that capitalism is better than socialism

Yes, the capitalism better than socialism.The core of the capitalist doctrine will be defined as the
belief that the means of production and distribution should be owned privately in order to gain
profit: private ownership and free enterprise are believed to lead to more efficiency, lower prices,
better products and rising prosperity 1/2. Socialism will be stipulated as a theory which advocates
that ownership and control of the means of production should belong to the community for the
common good: under these premises the community is assumed to be both more just and
humane3.That capitalism is the presiding economic system of today's world is indisputable,
however the fact that it is dominant does not necessarily imply that it also is the supreme. The
20th century has been marked by fierce debates challenging or justifying the validity of
capitalism; world powers have disagreed and still disagree about the benefits and drawbacks of
the system and the dispute's considerable consequences can amongst others be felt through the
relics of the cold war4/5.
Free Society, Free Market

America should thrive on a free market system. When the system breaks, it isn't time to revert to
socialism. There should be legal recourse for victims of companies who break the law. Anyone
should be allowed to make money, as long as they do so legally and pay appropriate income
taxes. The recession taught Americans a valuable lesson--the line between capitalism and
socialism can be blurry.
Capitalism and socialism are different political, economic, and social systems in use by countries
around the world. The United States is usually considered a capitalist country while Sweden is usually
considered a socialist country. Sweden is not socialist, however, in the true sense of the word. A more
extreme form of socialism is communism. An example of a communist country is Cuba. In truth, many
countries have mixed economies. They have economic elements of both capitalism and socialism.
Capitalism increases the opportunities in the marketplace for personal economic growth. It increases
opportunities for entrepreneurs to increase their personal wealth and for societies to grow as well. Hard
work is rewarded under a capitalist economy.
In a capitalist economy, consumers can work toward riches and financial freedom. A competitive
market results from capitalism and consumers are presented with a wide array of products and


services to choose from. Consumers and companies regulate the free market. This is often seen as
one of the strengths of a capitalist society.
Socialism is economically inefficient as it does not reward entrepreneurs. Instead of
rewardingentrepreneurs for creating wealth, it punishes them by making them pay higher taxes.
Socialism can actually lower the living standards of all by not rewarding work and by making public
assistance available to more than the neediest.
Many countries have mixed economic system with elements of both capitalism and socialism. In the
U.S., predominantly a capitalist system, there are still social programs such as social security and
Medicare. In many socialist countries, there are private business firms.



Con
Isn't It obvious

The distinction is extremely important, for it frees supporters of capitalism from having to
defend it as a caring or compassionate institution, which it is not. It is coldly mechanical.
The problem is free-market advocates think capitalism is a political system and through
rationalizations and justifications for the single-variable profit pursuit deny one of Judes
best insights, What must any system accomplish? At the core, it must provide a method by
which its smallest constituent unit, a household, can save the surplus of its days work for
the day when it cannot work. When millions of Americans could not work the Right had
nothing to offer that would speak to this reality- in economic contraction, the daily output of
Americans is not sufficient to provide for illness, accident or natural disaster. There must be
a system of either risk-pooling and income distribution, the question though is whether it is
paid for by taxation or bond finance. President Obama realized this but his solution is
proving to look like something other than he promised and potentially at a greater cost to
freedom than the electorate bargained forBetter? Absolutely not!

Capitalism is not what many people think it is, neither is socialism. People think capitalism is good and
perfect... Then why are there so many poor people starving on the streets? Why can't you pay your
student loans? Why can't you pay for your health care? Why is the national debt increasing? Why 1% of
american people control 40% of the wealth? All of these things are fixed with socialism. You get free
health care, free education, free public transport, and sometimes free food. While in capitalism, the
government doesn't care about your health care or that you are starving in the streets. And I'm talking
about SOCIALIST countries, not COMMUNIST. Americans seem to mix them a lot ...
Say what you want about socialism, but when your economy fails, and your debt destroys you, next time
you will see socialism the other way.
Socialism seeks to promote equality among people by providing them with many of the same social
benefits. Examples of benefits that individuals in a socialist society are provided are educational,
health care, and care for the elderly and the vulnerable. Socialism means paying for things without
necessarily expecting a financial return, just for the greater good. One of the pros of socialism is that
it seems to be a way of achieving slow, but peaceful, progress. That is, at least, a goal of socialism.
Capitalist economies are money-driven without much regard for people unless they are owners or
shareholders of business firms. In a capitalist economy, there is fierce competition and, perhaps,
unfair competition. There is a tendency, in capitalist economies, for big companies to get bigger and
for monopolistic behavior to occur. Unfair labor practices may occur since companies are driven by the
profit motive. Since capitalism requires continual growth, environmental damage may occur as the
resources of the earth are depleted. Some say capitalism makes the rich richer.
1) Capitalism is not a political system, but an
economic one. Jude stated, The distinction is extremely
important, for it frees supporters of capitalism from
having to defend it as a caring or compassionate


institution, which it is not. It is coldly mechanical. The
problem is free-market advocatesthink capitalism is a
political system and through rationalizations and
justifications for the single-variable profit pursuit deny
one of Judes best insights, What must any system
accomplish? At the core, it must provide a method by
which its smallest constituent unit, a household, can
save the surplus of its days work for the day when it
cannot work. When millions of Americans could not
work the Right had nothing to offer that would speak to
this reality- in economic contraction, the daily output of
Americans is not sufficient to provide for illness, accident
or natural disaster. There must be a system of either
risk-pooling and income distribution, the question
though is whether it is paid for by taxation or bond
finance. President Obama realized this but his solution is
proving to look like something other than he promised
and potentially at a greater cost to freedom than the
electorate bargained for.
2) Socialism is more sensitive to signals of wealth
inequality. Although its prescriptions for the problem
things like raising the minimum wage, universal
healthcare and shared ownership of productive assets
are trickier to deliver than they assume, socialism is far
superior to capitalism in telling us that a member of the
electorate is being left behind and that a gap in the
wealth distribution is widening. This is natural
capitalism puts a premium on unbridled freedom rather
than egalitarian equality. It is socialists who have been
more vociferous in opposition to the central problem of
the post-Bretton Woods environment a breakdown in
the system of financial intermediation the ability of
the market to finance the exchange of relatively simple
tasks, because of the risks attached to a floating


currency and almost confiscatory taxation of
capital, as Jude described. Republicans whine about
the latter problem without doing anything about
currency stability. If they were to follow Nathan Lewis
advice and offer growth-oriented tax reform coupled
with a return to the gold standard they would achieve
what Karl Marx articulated better than Adam Smith
about money par excellence.
3) A Socialism that permits more market signals and
personal freedoms can be superior to a Capitalism
that permits pursuit of profit by an elite manipulating
public policy. As Jude wrote, Capitalism did not fail in
the Great Depression because profit was burdened with
social concerns. It failed because the capitalist ruling
class saw an opportunity to increase its profits by an
increase in the protective tariff using its political
muscle to push Smoot-Hawley through the Republican
Congress and persuade President Hoover to sign the
legislation. This was a blatant intervention in the
market, not for the usual purpose of increasing
government revenues, but to engineer a social outcome
desired by Big Business. The same thing can be said of
Wall St. banks last decade those who have benefitted
the most during the derivatives-era regime birthed by a
floating dollar who financed the mortgage mess via
wholesale lending and extreme securitization, a far
greater problem than either Fannie Mae or Freddie
Mac s role.
Nevertheless, the clock is ticking on President Obama to
deliver good socialism. My sense is he cannot and
that he must now swing to growth policies centered
around entrepreneurship before Republicans figure it out
for themselves and triangulate him on redistribution.