With so much political discussion on Facebook, I find it justified to unravel some of the terms which are thrown around, especially related to forms of governance. They are often misconstrued and misplaced in their usage. For eg. Capitalism is often used in the context of “crony capitalism” while “socialism/communism” is thought of a system which can truly equalize:
Capitalism: Is not “crony capitalism” where lobbyists control the lawmakers. Capitalism is a form of private free market enterprise, where means of production are owned privately and demand and supply dictate prices. No country on this planet is 100% capitalistic because in every country, Government controls some of the means of production; taxes public and enforces regulations on enterprises including price control in some cases. In this system, the enterprises are rewarded for their entrepreneurial efforts and hence this system usually succeeds because it capitalizes on the human evolutionary instincts related to incentives. Capitalism as an idea of a free market private enterprise is not against social progress.
Socialism/ Communism: Socialism and Communism are not the same but have a lot of similar ideas. It is a form where Government controls the means of production and every citizen works for the Government. In Socialism, they earn roughly equal wages and benefits. They are free to spend their wages on anything of their choosing. Advancement and production is limited because there is no incentive to produce more since an individual gets the same amount irrespective of the effort. A perfectly socialist country will provide all things of necessity to everyone, equally, like education, healthcare, housing, clothing and food. This rarely happens in practice and most truly socialistic societies usually see widespread corruption in the Government. The different attribute of communism is that production is distributed based on need and in a true communist system, there will be no concept of money since the Government will provide citizens with what it thinks are necessities.
Knowing this, we need to understand that a successful country is usually a mix of more Capitalism and a little bit of Socialism if we define success as more production and advancement of economy.
Capitalism does not have anything to do with some social policies like abortion, homosexuality, racial prejudice etc. In the US, since the right wing politics is both pro-capitalism and socially conservative, capitalism is often mistaken with conservative social policies.
On similar lines, some fiscal socialistic ideas are not necessarily bad for the economy. Some regulation, taxation and Government control is indeed needed. Also, the left wing politics in the US is liberal about social policies, hence leading to progress on social issues. However, it has been accused of overdoing its liberal fiscal front.