Advantages and Disadvantages of Capitalism and Com
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Advantages and Disadvantages of Capitalism and Communism
There are many advantages and disadvantages to a communist or capitalistic society. According to the American Heritage Dictionary, Capitalism is an economic system characterized by freedom of the market with increasing concentration of the private and corporate ownership of production and distribution means. Capitalism is an internally stable economic system, in that it is consistent with human behavior. People understand that there is no such thing as a free lunch. You have to work to survive, and only the lucky who manage to prosper within the system make it to the top. Capitalism is also externally stable, in that survival in a capitalistic system requires innovation and flexibility to keep up with the changes in supply and demand. Competition within the system also provides for many advantages. But sometimes under a capitalistic system, those in power tend to construct rules that limit diversity and competition, thereby weakening the flexibility and strength of the system as a whole. There are also many imbalances in opportunity, which may disrupt the proper flow of the system.
Yet Communism is a system, which allows for everyone to be equal. Those that participate benefit and those that don’t are left behind, creating an incentive to participate. Communism requires common goals and agreed upon rules to allocate proper responsibilities and resources. This usually leads to sharing, which builds stronger social communities, creating a stable economy. But there are also many problems with this system. Communistic systems tend to block out external cultures and exclude outside competition, weakening the system\'s ability to learn from, or compete with external economies. Also large or geographically broad populations tend to be diverse, making it difficult to maintain a common goal or set of rules for shared effort and resources.
By definition, Capitalism is an economic system controlled chiefly by individuals and private companies instead of by the government. In this system, individuals and companies own and direct most of the resources used to produce goods and services, including land and other natural resources labor, and “capital”. “Capital” includes factories and equipment and sometimes the money used in businesses (Friedman, 5).
Capitalism stresses private economic decisions. 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. They also compete with one another to sell products. Nations whose economies are based on capitalism include the United
States, Germany, Canada, and Japan.
Although a private individual or group of individuals may control their income and a large section of an economy, the government can control some aspects of the economy in every nation. Capitalism is some times called Free enterprise, despite its limits established by the government. Many organizations and businesses flourish from the existence of capitalism. Non-profit organizations prosper from capitalism such as: The Roman Catholic Church.
As one of the largest and most common religions in the world, the Roman Catholic faith is sustained through capitalism, for it is a capitalist organization. It can be considered a Capitalist organization in the fact that income is freely given in return for nothing. One’s religion can definitely influence their economic decisions, lifestyle and social status. The Roman Catholic Church believes that capitalism can become a type of injustice. For example, some people in capitalist nations can afford many luxuries. But at the same time, others lack adequate food, housing, and other needs. This unequal distribution of wealth results largely from capitalism’s emphasis on individuality. The Catholic Church cites examples of inequality as incorrect. However, the church and other religious denominations thrive from others’ prosperity and income.
Capitalism is a definite social justice issue. One reason why people do not necessarily feel obligated to help others less fortunate than him or herself is because the economy focuses on individualism, which leads to greed and hoarding. Another reason why capitalism is a social justice issue is that it deprives certain people of their human rights as well as the dignity and respect that all humans deserve. As a result, we can ask ourselves, “are we truly free?”
On Independence Day we commemorate the birth of America as a free nation. But even more than that, we commemorate the birth of Americans as free men. At a
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Economic ideologies, Capitalism, Social philosophy, Production economics, Economic liberalism, Capitalist mode of production, Economic system, The Spirit of Democratic Capitalism, Criticism of capitalism
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