Capitalism Essay, Research Paper
A characteristic of man that separates him from the majority of the
animal world is his organization of social and economic systems.
Man, however, retains traits of his evolutionary ancestors in the
form of self-preservation and greediness. While many political,
economic, and social systems attempt to eliminate this modern
form of natural selection, capitalism and similar economic
structures preserve social inequality in many forms. Historically,
this preservation of financial inequality has achieved a higher
standard of living generally than systems initially formed and
employed to achieve just that. There are specific economic factors
of capitalism that enables it to make life more civilized and
beneficial for its population.
By definition, capitalism is an economic system controlled
chiefly by individuals and private companies instead of by the
government. Through this, it stresses private economic choices.
People are free to decide how they will earn and spend their
income. Companies may choose which goods and services to
produce and how much to charge for them based on the wants, or
demand of the people. This regulates the amount and kind of
products produced to accommodate the population. Because of
this emphasis on economic individual freedom to become the
wealthiest of one?s nation, many inequalities form in the
distribution of wealth. As many citizens are able to acquire their
needs to survive and eventually purchase luxuries, some citizens
are not able to support their own existence and eventually die of
cold, starvation, or other such causes. Although this is viewed by
many as inhumane, capitalist societies achieve a higher standard
of living than other socialist and communist societies. This also
provides incentive for the unemployed to find jobs, as they are not
supported by others in a capitalist society.
Historically, communist societies achieved less
disproportionate financial inequality, but the standard of living
was lower than that of capitalist societies. This is a major reason
that capitalism is better. Also, a free market in a capitalist society
deals with the economic needs of the people better than socialist or
communist government planners. The complexity of human
behavior and the vastness of one society is too great for human
planners to address. A typical example of this can be found in the
former Soviet Union. The planners of this communist nation
issued a plan that factories with the greatest production of cloth
textiles in feet would receive monetary bonuses. In response, the
factories narrowed the size of cloth, producing more feet of
unusable textile. This irrational outcome would not have occurred
in a capitalist government where the usefulness of the product
would be a paramount consideration.
Rather than emphasizing job security of citizens, capitalism
prefers harder and more efficient workers over less efficient
workers. Although one may have had a job for sometime, he/she
may still be replaced by a more efficient worker. This code of
work ethics forms higher levels of competition, boosting work
quality and production. Many privately owned companies exist in
capitalist societies. The population is not vast enough to support
all of these companies. Therefore, the company producing the
most desired product earns the most money while companies
producing the least desired products eventually go out of business
if they do not adapt to the market. This too inspires higher
productivity through competition. Although forfeiting security,
the incorporation of competition in a capitalist society makes
better products for its citizens, increasing the standard of living.
Furthermore, a capitalist society justifies differences of
wages in different jobs. Services in a capitalist society work in a
similar manner as products. If a service is particularly important
to a society?s population, the person performing this service will
earn more money. Hence, the position itself will become more
desirable to more people. This creates similar competition to that
of production, including the same benefits to the society. People
performing this desired service become more skilled at it to
maintain their jobs and customers, servicing their customers in
better ways. Those not as skilled at this profession will seek jobs
they are more talented at, presenting additional services to the
society.
Taking all of these advantages into account, in becomes clear
that a capitalist government is the most efficient organizer of
business. The government sets up trading markets and allows
access to natural resources, after which it allows private
enterprises to trade and manufacture products as they please. In
reality, this produces the best standard of living, hence a capitalist
government is the best organizer of business.
In theory, communism presents the greatest argument of its
superiority. In theory, it is the perfect utopia. However, viewing
the historical standard of living of communist societies, capitalism
is clearly a superior system. The great German philosopher
Immanuel Kant once wrote that a theory that does not work well in
reality is not a good theory. Theories must be based upon
evidence already drawn from reality. Realistically, a pure
communist society is impossible to achieve. Before the
government of a communist society withers away, it must trust
little or one person(s) to control the government. Historically, this
leader or group of leaders have seized sole power, forming a
dictatorship instead of a communist society. The invisible hand
and self-regulation of a capitalist society is both good in theory
and in practice for its high standard of living.
Democratic socialism is also an ideal compromise between
capitalism and communism, abiding by the free market of
capitalism while providing free healthcare and secured jobs for its
citizens. However, the cost to support this society is far too great.
As a result, taxation increases to high amounts, and costs of
products become unaffordable. Present democratic socialist
nations, such as Germany and France, cannot maintain ideal trade
amounts with other countries due to high costs in their own
products. Therefore, capitalism is a superior economic system to
both communism and democratic socialism.
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