The idea of capitalism is everyone competing against each other for monetary gain. This can sound evil, or even appear evil.
With that being said, capitalism works better than any other economic system because competition improves quality, and creates competitive pricing. A system that allows for an incentive to profit on something that will improve society is crucial to a thriving civilization. Permissionless innovation is the reason most technological achievements have been created in the United States, as opposed to our more autocratic European counterparts.
But doesn’t the idea of everyone working together to mutually benefit the collective sound heartwarming?
This however, is called Communism/ Socialism/ Democratic Socialism. This system has never worked, will never work, and can never work as long as humans have the incentive to want to succeed, and compete.
This however, is called Communism/ Socialism/ Democratic Socialism. This system has never worked, will never work, and can never work as long as humans have the incentive to want to succeed, and compete.
The reason I fundamentally believe that “socialism”/ “democratic socialism” / (whatever you want to call it) is immoral, although it may sound heartwarming, is because it takes away people’s basic right to transact freely.
Capitalism required mutual agreement between both the seller and receiver. Socialism, however, forces a mandated obligation between both parties. This created a disincentive for innovation and competition.
Why is capitalism so good at reducing poverty?
This is not a theoretical question. Look at any socialist/ communist country’s poverty rate, and then look at any free market capitalist country. Capitalist countries have much lower poverty rates, and a much higher average quality of life. In fact, countries that have more economic freedom usually have much lower poverty rates.
The reason Capitalism is most effective at reducing poverty is, as I’ve said before, capitalism allows for people’s natural incentive to want to succeed. This creates competitive job wages, item prices, and quality assurance.
Countries like Denmark and Sweden that are called a , “Socialist paradise”, are not really socialist, but actually free market capitalist societies that happened to also have a socialized medicare system. This reinstates the fact that socialism has never worked, as these countries are free market capitalist countries. Not only do free market countries do better, but free market states also do much better than their autocratic counterparts.
What do you think of Socialism? Do you think that it is moral?
Sources:
1. Statistics that support my facts: https://www.heritage.org/index/explore
2. https://www.forbes.com/sites/artcarden/2010/09/20/free-market-doesnt-mean-pro-business/#3353c5552131
3. http://www.econlib.org/library/Enc/EthicsandEconomics.html
4. http://econfaculty.gmu.edu/wew/articles/fee/entrepreneur.htm
I agree that socialism -- in practice -- doesn't work and that history has shown us this. I also agree that capitalism is the best system we have; however, I want to make a key distinction here: just because capitalism is a *better* system does not mean that it's a *perfect* system. Your example of Denmark and Sweden are terrific examples of how systems can be arranged to create the best outcome possible for their citizens. They have a free-market system, yet they have socialized medicine. (In fact, many countries do.) . But here's what I find frustrating: when people in the United States advocate for *some* policies that are deemed "socialist," they are frequently labeled as "communists" or "socialists" when, in fact, they are simply advocating for some policies (like Denmark and Sweden) that benefit citizens. It's an interesting discussion and I'm glad you posted on this, Danny.
ReplyDeleteHere are some recommendations:
1 - Proofread your post more carefully so that your reader doesn't have to scroll sideways to read your post.
2 - Your image doesn't help your post at all. It suggests that socialism advocates killing people for their money and that capitalism is a perfect system where everyone holds hands and has equal amounts of money. This obviously isn't true, and including an image like this as the first impression for your blog post isn't a careful, measured way to write to an audience.