Good Example Of Capitalism And Socialism Essay
In the United States, the federal government rejoined the game and control of the economy very closely. The push grew much in 1900 and 1920. There was the creation of major agencies to this effect. In the new deal era, there were rampant programs and workers started complaining about low wages. It therefore led to socialism as there were many agencies formed like the social security program. 1Those who advocated for capitalism began to complain about the proponents of the industry. They said that capitalism reduced the economic system. There was impregnation of capitalism with socialism. However, social security was in place, and people increasingly depended on programs run by the department of health and human service. For instance provision of education and health facilities involves socialism.
The revolutions destroy the capitalist system replacing it with the communist system. Socialists believe that wages determination ought to base on the quantity of labor applied in production. There was a separation of capital into two categories, the variable and the constant. The constant is the capital from machinery in addition to raw materials. It undergoes depreciation and thus not included in the factors of production.2 the variable is the labor capital and forms the sole power of valuation of the products produced. According to both of them, technology is the principle source of economic development. It facilitates the process of production of labor. It is more productive and efficient.
1. Klein Naomi, Christian Ethics As Witness: Barth's Ethics For A World At Risk (Eugene, Or: Cascade Books, 2010).
2. Philip Ball, The Elements: A Very Short Introduction (London: Oxford University Press, 2004).
Capitalism aims at increasing the marketplace opportunities for personal economic growth. It raises the opportunities for the entrepreneurs so as to increase their private wealth in addition to encouraging the growth of societies.in a capitalist economy; there are rewards for hard work. In the capitalist economy, consumer’s users work with the aim of attaining riches and financial freedom. Due to that, there is the rise of a competitive market.3 there is a wide variety of products presented to consumers. There is regulation of the free market by companies and the consumers, and this gives the strength of capitalist society. On the other hand, socialism seeks the promotion of equality among the people through the provision of similar benefits. The benefits include the healthcare, education and the care for the elderly in addition to the vulnerable.4 It implies making payment for things without looking forward to financial returns. Socialism is a way of achieving progress in a slow and peaceful manner that forms the goal of socialism.
The capitalist economy seeks to maximize money without regard for the people. It only cares for the shareholders of the business firm. There is the existence of aggressive competition in capitalist economies which is very unfair.
3. Rohnn B. Sanderson and Marc A Pugliese, Beyond Naïveté (Lanham, Md.: University Press of America, 2012).
4. Zoltán Ripp et al., Influences, Pressures Pro And Con, And Opportunities: Studies On Political Interactions In And Involving Hungary In The Twentieth Century (Budapest: Napvilag Kiado, 2014).
There is a probability of big companies getting bigger and chances of occurrence of monopolistic behavior are very high, there is the appearance of discriminating labor practices due to companies’ motive of profit maximization.5 There is the occurrence of environmental due to the continued growth requirement of the economy.
There is a depletion of resources due to overexploitation in the economy.6 The economy makes the richer to be richer. On the other hand, socialism is inefficient economically since the entrepreneurs receive no rewards. Instead of hem receiving rewards after the creation of wealth, they receive penance by making them pay high taxes. It leads to a reduction in standards of living standards of all the people through failing to reward people. The society makes the public assistance accessible to more than the deprived.
The unintended consequences of 2008 crisis led to a massive loss of trust in government institutions and the US capitalist economic system. The US fell from second in 2000 to 18th in 2012 according to the global ranking.7 The drop in ranking was a reflection of the perception of less secure property rights, bigger government and increased business regulation in addition to according of favoritism to special interests.
5. Hugo Radice, Global Capitalism (Hoboken: Taylor and Francis, 2014).
6. Peter Flaschel, The Macrodynamics Of Capitalism (Berlin: Springer, 2009).
7. Paolo Savona, John J Kirton and Chiara Oldani, Global Financial Crisis (Ashgate, 2011).
A catastrophe of confidence indicates a loss of public trust. To protect the scheme from failing in the presence of extraordinary government assistance involves bailouts to a lot of financial institutions. It strengthened believe that the public support was only for large and complex financial entities. The financial intermediaries lacked accountability in addition to discipline. They therefore led to the crisis and provided evidence of resistant to shortcoming of the extravagant risk taking.8 The special treatment was a violation of a fundamental tenet of the American capitalism. All the people in addition to institutions possess the capability to succeed, in addition, to failing depending on their actions.
Most of the Americans thought that capitalism was better than socialism. However, capitalism has lost value and majority is looking forward to socialism. For instance, the public school presents socialism. The majority of the people have moved from being capitalists to being socialists. However, not all the people are socialists. Some are still capitalists. Socialism is getting teaching professions in major universities in the United States.
8. Philip Arestis, Rogério Sobreira and José Luís Oreiro, The Financial Crisis (Houndmills, Basingstoke: Palgrave Macmillan, 2011).
Arestis, Philip, Rogerio Sobreira, and Jose Luis Oreiro. The Financial Crisis. Houndmills, Basingstoke: Palgrave Macmillan, 2011.
Ball, Philip. The Elements: A Very Short Introduction. London: Oxford University Press, 2004.
Flaschel, Peter. The Macrodynamics Of Capitalism. Berlin: Springer, 2009.
Naomi, Klein. Christian Ethics As Witness: Barth's Ethics For A World At Risk. Eugene, Or: Cascade Books, 2010.
Radice, Hugo. Global Capitalism. Hoboken: Taylor and Francis, 2014.
Ripp, Zoltan, Judit Borus, Patricia E Austin, and Ervin Fehervari. Influences, Pressures Pro And Con, And Opportunities:Studies On Political Interactions In And Involving Hungary In The Twentieth Century. Budapest: Napvilag Kiado, 2014.
Sanderson, Rohnn B, and Marc A Pugliese. Beyond Naivete. Lanham, Md.: University Press of America, 2012.
Savona, Paolo, John J Kirton, and Chiara Oldani. Global Financial Crisis. Ashgate, 2011.