Capitalism vs Socialism

The essay below is not an exact transcript of the video, text has been added or edited, and the video does not cover the entire essay, exactly, but it comes very close. Enjoy!

This is a discussion on capitalism and socialism and why I think we need a careful balance between the two. I will first provide a brief definition of both.

Capitalism is an economic and political system (based on self-interest and competition) in which all the means of production and distribution are privately owned and operated within a free market society.

Socialism is an economic and political system (based on group-interest and cooperation) in which all the means of production and distribution are collectively owned and operated by all members of a society.

In my opinion, both systems, in their purest form, have their pros and cons. Capitalism promotes a free market system whereby citizens are practically free to create almost any product or provide almost any service and ideally start their own business to make their own profits. One of the main selling points of capitalism is that it’s a system that primarily self-regulates. It’s meant to keep prices and the quality of products and services at least half way decent. Of course it doesn’t always work out that way, but that’s the general idea.

Another wonderful thing about capitalism is that it aims to preserve economic freedom from excessive government control. That’s a good thing. However, there is always at least some government regulation involved, as there should be in my opinion. Though most hard core capitalists believe in the French expression Laissez-Faire, which means “leave it alone.” They hold to the idea that if government would just stay out of the way and not legally interfere or try to regulate what business owners can and can’t do, all would go well. But in my view, as well as in the view of most leading economists, this is not realistic. The list of corruption that rises under a completely free market, is too long to go into. But one quick example, is how oil companies would surely release far too many carbon emissions into the atmosphere during their production process if unregulated by the government. You know the old saying, “If you give them an inch, they’ll take a mile.” When unregulated, people will always eventually fall out of line. It’s kind of like when the teacher leaves the classroom, there will always be those children who will stand up on their desks, throw paper airplanes and spit spit-balls. Whatever margin for error is given, it will always be used to its fullest degree. So there must be at least some rules.

Capitalism, on its own, is not flawless, and is too often unfair. For example, it’s not fair that a young teenager can come out with a number one hit single of a song the singer didn’t even write and make millions, while a hard working adult works all day in the Sun, digging ditches, yet can barely feed his family or pay his rent. Wealth is often unjustly distributed. In fact, it is and has been the American way. In America, people can gain wealth by finding it, by winning it, by stealing it, or by inheriting it. Money is too often not truly earned.

Unfortunately, most capitalists think that competition, and free markets solve all problems. Competition is good, but too much competition can be a bad thing, leading to inferior products and/or services. For example, things are usually made just well enough to outdo the competition in order to maximize profits, which is unfortunately the real goal of most capitalizing Americans. Parts are often cheep, services are rushed, and many wear a fake smile while they trick you into paying for things you don’t really need. It’s a dog-eat-dog world, a “sink or swim” ideology. But thankfully capitalism, when properly regulated, does help to keep prices, product quality, and the government in check.

Socialism on the other hand is a system that promotes equal opportunity, financial safety nets, shared profits and shared sacrifice. Under pure socialism, every able-working person would always have a job and always have an income. Though we currently live within a dominantly capitalistic system, we do have many socialized programs and services like our public school system, our public libraries, the police and fire departments, Social Security, Medicare, and welfare programs like unemployment checks, food stamps, and Medicaid. Many socialized programs serve as a safety net for those who lose their jobs or become too ill to work. Imagine what would happen if your house caught on fire, yet for whatever reason, good or bad, you couldn’t afford to have the fire department come and put it out. Though your neighbors, who could afford to hire the fire department, chose to do nothing about it. In all likelihood, your house would burn down, along with damaging the homes of your neighbors who stood by. Therefore, at least some safety nets should be in place.

However, the word socialism has become demonized by capitalists and is now somewhat synonymous with Democrat. Some of the main complaints and concerns many have with socialism is that it increases the size of government, can lead to wasteful spending, and can encourage “social loafing” or laziness, whereby people who could work harder choose not to, because they believe other citizens will pick up the slack. Therefore, you get a lot of free-loaders riding the coat tails of others. I agree these are all very valid concern, but the solution is not to get rid of socialism altogether. Let’s not go from one bad extreme to the other and over compensate. When people abuse their car by speeding, making illegal turns, or getting into accidents it’s not logical to get rid of all cars or ban all driving. The answer is to find more ways to prevent people from taking advantage of the system. For example, social psychologists have discovered that having a good work plan, involving specifically assigned duties, and having fair evaluations of individual performances dramatically reduces social loafing.

But some still worry that individuality would become lost within a purely socialized society and argue that it would cradle and overprotect citizens. I agree this would likely be the case which is why I believe some capitalism is needed to help remedy those problems. We have to maintain a healthy level of individuality and personal reward. If you are familiar with many of my philosophical views, you will know by now that I always advocate balance in everything. Total socialized assistance is wrong and so is having absolutely no socialized assistance. The solution is in a careful balance between the two.

Many also argue that a socialized system can not be as financially successful as a capitalistic one. There was an economic experiment conducted by a Mayo high school student, in Rochester Minnesota, named Paul A. Leonard. The experiment was intended to compare the financial success between a capitalistic group and a socialistic group. The results showed that students performed more pushups and acquired more candy under a more stressful capitalistic system in comparison to a less stressful socialistic system. Even though Paul’s classroom experiment was only meant to be analogous to the real world, as all experiments are meant to be, I still thought the experiment was oversimplified. Paul’s experiment maintained ideal conditions and gave the false impression that pure capitalism would be a total success. For instance, he did not factor in important variables like unemployment, price fluctuations, inflation and deflation, and theft often found within a capitalistic system. A more accurate picture would have shown some students, within the capitalistic group, merely standing by to reflect the idea that no one could afford to hire them to do the pushups or students stealing candy from other classmates in order to survive.

In the real world, we are not just dealing with mere pieces of candy in exchange for pushups. In the real world, people suffer greatly. They become homeless, sick, and die when, for whatever reason, they fall behind. Anyone, regardless of how rich or good looking or decent, can eventually become down on his luck and find himself in desperate financial need. Don’t be naive thinking that as long as you do the right thing and work hard that you are completely safe from any financial collapse. The insensitivity of unbridled capitalism–a financial machine that cares only about itself, as a whole, and not the individual–will leave you far behind to be crushed within its gears and turbines. Yes, capitalism can make a nation more financially powerful, in the short run, but look at the costs. Most are overworked, over stressed, and can’t spend enough time with their loved ones. Children, on average, are not being properly raised. It’s not good to have an economic system which primarily focuses on acquiring money at almost any costs. The amount of money a nation makes should not be the only measure of its worth.

So it’s true that a purely socialistic system may not be as financially successful in the short run as a purely capitalistic system. However, a purely socialistic system profits in other ways. Such a system is often more humane, more compassionate, less stressful, and less corrupt than a purely capitalistic system. In simplest terms, whenever there is a gain, there will be a loss and for every loss there is a gain. This Yin-Yang effect is why I always advocate a combination of both systems. It comes back to the balancing act I strongly believe in.

Capitalists celebrate financial independence, self-reliance, and individuality, whereas socialists celebrate interdependence, cooperation, and community. These are all good qualities when properly balanced. Socialists hate unbridled capitalism and capitalists often criticize any form of socialism. But it’s unfortunate that many have not yet come to realize that some socialism is a good thing, just as some degree of capitalism is a good thing. Independence and self reliance are fine attributes, however, there are times when we not only need to depend on others, but should depend on others, because it allows us to be better people and it helps us to be more communal.

To sum up, pure unbridled capitalism is too insensitive, too selfish, and too cruel. It’s a cut-throat philosophy—an every man for himself ideology. With pure capitalism, there is an inescapable loss, and that is the nation’s moral sole. On the other hand, pure socialism can be overprotective and may inhibit individual recognition and rewards for personal efforts, talents, and strengths. Both capitalism and socialism, alone and independent of the other, are doomed to fail. However, both socialism and capitalism are needed. We need a system that provides incentives to work hard and rewards those who do, yet at the same time, a system that is compassionate enough to lend a helping hand when necessary—one that does not cruelly punish those who truly, for legitimate reasons and unjust circumstances, can’t work as hard or produce as much. Keep in mind that what affects one citizen ultimately affects all other citizens and one bad apple spoils the bunch. We are all apart of the same team whether we like it or not. So we need to start exercising a more cooperative effort in order for the human race to survive. It’s easy to do the wrong thing and it costs to do the right thing. We need a system that supports and maintains a healthy balance between capitalism and socialism, between competition and cooperation, between independence and dependence, between the private sector and the public sector, and between regulation and freedom.

Right now we are very out of balance, and as a result, nations are falling. When there are children who are not getting properly educated, it means something is wrong with the system. When people are starving, it means there’s something wrong with the system. When people can’t get proper healthcare, it means there is something wrong with the system. We must all pull our resources together to aid one another during these desperate times or the entire system will fall and all our cherished money will become completely worthless. Personally, I would prefer to trade in some of my cash to help my fellow man and to keep my sole in tact. Remember, what goes around comes around. The more you support your fellow citizens, the more they will be able to support you in your time of need. “All for one and one for all” should be the slogan for America . . . and the world.

Added note:

Again, there is no perfect political system. No matter how well a system of government is designed and built, corruption will always manage to seep through the cracks. But, it’s our civil duty to do all we can to push back any and all forms of corruption and injustice as much as possible.

Down through the ages, we come closer and closer to creating the perfect society, even though we have had many setbacks. Like a pea rolling back and forth along the walls of a huge bowl, we are slowly but surely finding our way towards the center of equilibrium. Like a set of adjustable lenses the answers are coming into focus. Soon the arrow of correctness will hit the bull’s-eye straight enough.


10 Responses to Capitalism vs Socialism

  1. Mubariz Tariq (Tariq Mehmood) says:

    Your video gives a very comprehensive explanation that how a balance way can be adopted between capitalism and socialism on management level. But there is much more which actually drives systems or push systems to run.
    What is God, I am not interested in. What I am interested in is that what impulses, what motives, what incentives, what feelings or emotions God creates in an individual to do great works, to accomplish big tasks, to make impossible a possible and to perform extraordinary feats. I cannot copy paste one quotation but I will put in my own words:

    “If you tell me that what type of idea of God one nation holds? I will tell you what type of that nation itself is.”

    Human intellect cannot give any strong rationale why should we help poor. That is the singular reason which puts socialism always in crises. Only the emotions of revenge against capitalist are its driving force. When revenge cools down, socialism itself cools down. Every man wants to keep his earning in his pocket. He finds no logic to distribute his hard-earned money to low-earning poor. That’s why that government authority, bureaucratic force and power of law is used to extract money from the pockets of rich to compensate poor.
    The economical system of quran and communism is same, but their philosophy of life is completely different. Communism fails because of its life philosophy. Quranic economical system gets successful because of its life philosophy. Communism wants to implement a godly value by negating God. Quran first brings God then convinces him to enforce God’s economical values. When one comes to believes in God, then this idea/concept of God first affect the human thought. Then this thought produces the fountains of emotions in human body by creating chemicals in body which enable humans to perform remarkable feats. Subtracting the idea of God from the realm of human thought produces limited and unbalance emotions to execute limited self-centered tasks in life ( as I interpret God). This time I do not remember exact reference to Quranic verse which almost says:

    “ We will make human wear the dress/clothing of Silk in paradise”

    Paradise is the symbolic expression of human’s beautiful future before death and after death. The Arabic word used for Silk is “Hureer” which denotes heat or temperature. It simply means that people with frigid, cold, dead emotions will be prepared to explore volcanoes/heats of emotions hidden inside them (This is what Dress of Silk actually means, and you yourself knows that Paradise and Hell are the states of mind). These volcanic emotions are the Steam Engine of Quranic economical system.

    One tradition goes in Islamic History that one badly wounded thirsty person in war was crying for water. When someone brought him water, one more wounded person started crying for water. First wounded person sacrificed and allowed that water to second wounded. That time a third wounded person began crying for water. Second wounded requested to give water to third one. After giving water to last one. water-bearer came back to second one, he found him dead, and when he came back to first one, he was also dead.
    This is the volcanic eruption of emotions of sacrifice, help, love, sympathy when concept of God is infused in minds. This is a big querry/question/ matter for research for me why wrong or right concept of God makes human to perform extra-ordinary tasks (wrong or right). Hindus burn wives after the death of their husbands-why?. Mystics often cut throats of their children and wives-why?. Even in Quran, Abraham wrongly takes his dream as revelation and completely gets ready to cut the throat of his own son (though God stops him)-Why?.

    Quran deals the question of right of ownership in a very different way. Capitalism gives the ownership (proprietary rights) of wealth in the hands of individual. Communism transfers this ownership to the hands of State. Quran neither gives it to individual (bourgeois) nor to State (or proletariat). Quran says the all the ownership rights of all wealth on earth and skies directly goes to God. So no rich will feel any superior complex by giving money to poor. And no poor will feel inferiority complex by taking money from rich. Human cannot be a slave of any other human in economical (and all other) terms. Only God, the owner of every thing, has the right to give.

    “Allah belongs the heritage of heavens and the earth” (Quran 57:10)

    When God calls something his own, then it simply means that such thing (commodity) belongs to all humanity. For example

    House of God
    (means House of all humans, this house of God is located in Macca in Saudi Arabia where muslims pay pilgrimage)

    Earth of God
    (means Earth of all humans, so all wealth of earth belongs to all human)

    She-camel of God
    (means she camel of all humans)
    According to quranic story, capitalists and affluent of one nation (named Samud or Thamud) has captured the Streams , fountains and pastures and obstructed the animals (economical resource of that time) of poors to drink water and graze. God’s prophet named Saleh convinced those effluents after a lot of struggle to open those pasters and streams for all humans (and their animals). But, as a proof, he fixed one she-camel as “she-camel of God”, and said that nobody(Tariq or Guyus) owns this she-camel. Just think that this camel is only of God (as a sign). The verse goes like this:

    “And O my people, this is the she-camel of Allah (God) – [she is] to you a sign. So let her feed upon Allah ‘s (God’s) earth and do not touch her with harm.

    So things of God are actually the common property of all human beings

    This topic is very long and very interesting, so I will discuss it in very small pieces so that you can enjoy it. I will try my best to be brief ( though it is very difficult).


    • Guyus Seralius says:

      Tariq Mehmood,

      I keep trying to get a hold of you, but I never get a response back. I’ve sent messages to your email and to your son’s email. Are you getting any of them?


  2. Shoshana Gross says:

    I can not believe that there is someone out there who believe the same as I do.
    Do you know if there is an organization of Pantheism in the Dallas Metroplex area?


    • Guyus Seralius says:

      Yes, I know the feeling! I don’t know of any organizations specifically located in Dallas, but I belong to an online pantheist facebook group which anyone is allowed to join as long as he or she believes “All is God” or all of nature/universe is responsible for our existence. I will leave a link to it below. I’m sure you would be very welcomed there. 🙂


  3. I wrote a philosofical essay on this topic. The video helped me a great deal, thanks a lot!


  4. Conor says:

    What are your thoughts on Georgism?


    • Guyus Seralius says:

      I’ve heard a little bit about geonomics, which is what Georgism stems from, but I’m not yet familiar enough with all the specific details and tenants of Georgism, itself, to give an informed opinion. From what little I do know about it, it sounds interesting enough to investigate further, which I now plan to do. I remember when I was very young, how odd I thought it was that people could and did claim or buy ownership over land and would even go to war over it to possess it or to defend it. To me, at that time, it was as strange as the idea of someone trying to own the air we breathe. But now that I’m older, I do understand that it is a very valuable resource which has been and will continue to be fought over and defended. I always thought it was unfair when a lot of land was granted to early American explorers and then handed down to family members, while other hard working Americans had no land in their family line. Geoism seems to have hopes of evening the playing field more. The one main thing I do know about geoism is that it aims to provide a fairer, more progressive tax system (the wealthier pay more in taxes), which I’m all for and believe to be justified and sustainable. You’ve inspired me to want to find time to look into geoism more closely, so I may later owe you a big thank you! 🙂


      • Conor says:

        Yes, you should. Georgism certainly does level out the playing field, while at the same time avoiding the extremes you talk about.

        I’d just like to give you a big thank you for getting me into pantheism, since I became a pantheist, I have since gotten very interested in philosophy and the way I think about and view the world has changed drastically since I found you. I now look at the world with wonder and awe just as I did when I was a child. Keep up the good work!.


      • Guyus Seralius says:

        Wow! I’m so glad to hear that and you’re so very welcome! And a big thank you right back to you for letting me know I had that level of a positive influence regarding pantheism. That helps to make me feel that all the work I put into posting my essays and videos onto public forums is all worth it. 🙂


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s