I notice more and more of my friends such as Randy Gage, Art Jonak, Robert Ringer, Paul Jacob and others investing a lot more of their writing space on the topic of Capitalism vs. Socialism. I’m glad they are because the differences between the two are the differences between prosperity and misery both for individuals and for the masses.
Since we’ve never in our world history had a truly capitalistic society, for our purposes here, we’ll refer to mainly-Capitalist societies as “Capitalist” and those that are not as “Socialist.”
(Explanation of above: the U.S. at one time came ‘relatively’ close to pure Capitalism (of course, the monstrous, immoral and horrendous institution of Slavery ruled it out and then the later creation of nationalized banking and government control of the money supply), as have some other countries — regrettably, we now operate in an economic system known as a “mixed economy — part Capitalist and part Socialist, which has a natural tendency to lean towards Socialism. And, this is regardless of the party in power.)
To the degree that Capitalist societies have allowed Capitalism to thrive, that is the degree to which their country and citizens have prospered. To the degree they have not, they have experienced the opposite.
Over the past 50 years the world has seen former socialistic countries turn on the spigot of Capitalism and move from rancid purveyors of poverty to become economic powers (just a few examples; think: “The Hong Kong Miracle”, South Korea, Japan, New Zealand, Estonia, etc).
Unfortunately, the term “Capitalism” is — in my opinion — one of the very most misunderstood terms in the English Language.
In watching the television pundits, reading the many articles and in listening to and participating in conversations on this topic wherever I might be, it’s very noticeable that the problem with the misunderstanding is right within the premise. This is where just about 100 percent of all misunderstandings occur.
“Even the most logical argument — if based on a false premise — can never lead to a correct conclusion.”
In order to intelligently discuss Capitalism and Socialism, we must know what they actually are; what the terms mean. Believe it or not, most people don’t. They have an … “idea” as to what they both are, but don’t really know.
This is SO dangerous that it has caused our country (the U.S.) to sink into a socialistic abyss.
Two problems I see with this:
Many Americans are not even aware we are have drifted into Socialism (since they can’t define either Socialism or Capitalism). And, if one is not aware of a problem, one is powerless to fight it.
Many Americans do not understand the extreme danger of such an economic system. (Typical question: “But, doesn’t Socialism help the poor?” Correct answer: No, not at all. Not one single bit. More on this in future postings.)
If you ask most people the cause of our current economic meltdown, they will cite “a failure of Capitalism.” I’ve also actually heard terms including runaway “‘de-regulation’ of the banking industry.”
In actuality, this crises had nothing to do with Capitalism or de-regulation of any industry, least of all banking, which is actually one of the most regulated industries there are.
First, for the problem to have been a failure of Capitalism, we would have to actually have Capitalism. We don’t; we have a mixed economy with so many rules and regulations that thwart Capitalism and the good that it does, it is sickening to those who understand it.
And, the irony of people blaming de-regulation of banking (the fact that it is hugely regulated and was protected from its own ineptness from the get-go) is so ironic it should be self-evident.
The fact that it’s not self-evident is downright scary.
If you are interested in how this meltdown occurred — and I truly hope you are — I’m going to ask you to click here and read two articles. The first is by Sharon Harris; the second is by Steven Horwitz. Though I believe Mr. Horwitz’ article title is titled incorrectly, the article itself is brilliant.
After reading the short article by Ms. Harris, there will be a link to the article by Mr. Horwitz, should you choose to read that, as well.
What about the definitions of both Capitalism and Socialism that I referred to earlier?
In Part 2, we’ll look at the definitions of those two terms, as well as the intent and, more importantly, the results of both. These definitions will provide the premise from which we can logically and intelligently discuss the two types of economic systems.