Capitalism, Communism, and Socialism

What is capitalism? Economic system. Believes in individual ownership and competition. The theory is that when everyone is selfish, it benefits everyone. Adam Smith is “the” capitalist Wealth of Nations: capitalism good for society

What’s good about capitalism? Freedom, choice. You can work wherever, buy whatever, and pretty much do whatever. If you’re successful, you can be very successful. Think Bill Gates, Papa John, Mark Zukerburg. Who would support this idea?

What’s bad about capitalism? No “safety net.” If you’re unsuccessful, you can be very unsuccessful. Think about the poor. Big gap between rich and poor.

What is communism? Economic system. Believes in collective (group) ownership and a planned economy (government makes decisions). The theory is that everybody pools their resources and labor to evenly distribute everything. Karl Marx is “the” communist The Communist Manifesto: 1848, class struggle, problems of capitalism

What’s good about communism? Security, basic needs met. Everyone would have a job, house, health care, etc. Who would support this idea?

What’s bad about communism? Lack of choice No reward for being a better worker or punishment for being a slacker (incentives and consequences). Everyone expected to be the same (lack of focus on individual growth).

Socialism. What is it? Socialism is the stage between Capitalism and Communism. It builds upon Capitalism by nationalizing the “means of production” (i.e. corporations, resources, banks, etc.), but not by making everyone equal. Higher taxes to the wealthy to give Government programs and resources to the needy

What’s good about Socialism? Deals with wealth inequality by giving gov’t aid/programs to the poor. Certain industries controlled by the gov’t don’t have to make a profit, so that benefits the consumer. Still gives individuals some choice.

What’s bad about Socialism? Higher taxes and more power given to the government. Less freedom given to the individual. Few incentives for business people to take risks and make innovations.