Capitalism vs Socialism – Comparing Economic Systems

Capitalism, socialism, and communism have tradeoffs that are controversial. The systems and ideologies have shaped the way people view the world. Where does capitalism begin and socialism end? It is about choice and compromise.

The major societal issues of education, healthcare, social services, and taxation are turned on by capitalism and socialism. Civil liberties tradeoffs weigh individual freedom against the social safety net. Because economics focuses on pocketbook issues, a lot of people think the field is just about money. societies have been in pursuit of the ideal system for centuries, one that can balance competing desires for freedom versus security, because economics is really about people and their lives. Some major contender have emerged, all of which are variations of capitalism and socialism in different degrees and combinations. It is a Sisyphean task to determine which is the best option in a definitive way.

Understanding and trying to solve these problems is the job of comparative economics. Comparative economics tries to uncover the influences, systems, and decisions that can do the most good for the most people. Edward F. Stuart, Professor of Economics at Northeastern Illinois University, is a specialist in both comparative economics and Russian and Eastern European studies. Professor Stuart has been traveling, teaching, and learning about these economic systems for more than 30 years. It could be argued that he was born to be a comparative economist, raised in a household that debated the libertarian views of his father and mother. His passion for the way these debates play out on a global scale is demonstrated by the personal link he has to his subject.

Economists try to understand complex systems that encompass finance and trade, as well as social structures, governments, family arrangements, geography, and more. The 24 lectures are illuminating. Capitalism vs. socialism is a comparison of economic systems. You will learn how the most influential modern economic theories were developed, how they function, and how they operate in opposition to each other, from the rise of Soviet communism to the future of the European Union and beyond. Professor Stuart shows that even the most controversial economic decisions boil down to a simple question: What makes a good society?

Success is measured.

Professor Stuart says there is no definitive way to determine if an economy is good or bad. Statistics and data points can be used to measure the relative health of a system. There is no shortage of measuring tools for GDP, unemployment, inflation, and even life expectancy. It’s not just inTranslating complex metrics that the greatest difficulty is. GDP is often discussed in the news, but not everyone thinks it’s a good indicator of economic success. Even though few people would argue that low unemployment and low rates of inflation are good things for an economy, they can’t agree as to whether or not they measure prosperity. Professor Stuart notes that people can argue forever using whatever statistics prove their point.

How do we know when an economy works if we don’t have a lot of information? Economic equality or rapid growth is more important. Infant mortality rates or low inflation? The history of capitalism, socialism, communism, and mixed-economies will show Professor Stuart that absolutes in economics are much like those in culture or politics. Rather, it is in finding balance, making comparisons and compromises that economies discover how to prosper, stagnate or collapse.

Prosperity has paradoxes.

The study of economics can seem like a numbers game, relying on large-scale, impersonal statistics to focus attention on broad trends. The human costs of prosperity can sometimes be seen as the cost of doing business. There is slavery and exploitation. There are unsafe working conditions. Child labor. Government oppression. Rather than focus on the issues. Capitalism vs. socialism. It will take you across centuries and around the world to show you both sides of the story, diving into the history of economic systems and the individuals and groups that shaped them.

There are many paradoxes inherent in economic systems if people are the real heart of economics. Professor Stuart points out that, while there are a host of advantages and disadvantages that must be balanced in any system, some can arise from unexpected or counterintuitive elements. There are some paradoxes.

• The necessity of strong government in free market systems . Successful, large-scale capitalist enterprise requires a strong central government to enforce property and contract laws.
• The “paradox of thrift .” While it is smart for individuals and businesses to save and build up cash reserves to survive a recession, when the behavior becomes widespread it will eventually negatively affect total spending, incomes, production, employment, etc.
• More money doesn’t equal more spending. Known as “marginal propensity to consume,” wealthy individuals demonstrate unstable spending habits, while poor people will almost always spend 100% (or even slightly more) of their income.
• “All animals are equal, but some animals are more equal than others.” Professor Stuart highlights how, in his allegorical novel Animal Farm , George Orwell underscores an irony of communism in practice, wherein everyone is said to be equal but a rigid hierarchy of power exists nonetheless.

The history of the economy.

Capitalism and socialism are not always in opposition to each other, but by looking at their origins and development, you will discover that they are, in fact, inextricably connected. At a time when new, more democratic political systems were emerging from the shadow of feudalism, many social, political, and even religious factors intersect to support the birth of capitalism. Modern socialism is the result of the pitfalls of free-market capitalism in the 18th and 19th centuries, as well as inspired reformers and political thinkers to envision new ways to create a better, more equal society. In various forms of authoritarian communism, socialist ideology was taken to an extreme. Professor Stuart shows why there is no pure capitalist system working in the world today by examining the histories and strengths of these systems.

Some of the greatest experiments and failures of the last few centuries, including the creation of early American socialist experiments, the far-reaching economic implications of World War I, and the Great Depression, will be discussed as Professor Stuart guides you through the origins and evolutions of economic thought. Along the way, he reveals unexpected connections between economics and other aspects of modern life and culture. You will find answers to questions in the lectures.

• Where do phrases like “when my ship comes in” and “there’s no such thing as a free lunch” originate?
• What is the correlation between the average physical height of a population and economic growth?
• Why are the goldsmiths of the middle ages so important in the history of modern economics?
• Where does the concept of the money-back guarantee come from?
• What is the link between a 19th-century socialist experiment and the microwave?
• How did novelists like Theodore Dreiser, Upton Sinclair, Charles Dickens, and George Orwell influence the arguments surrounding various economic systems?
• What can rock music and the Rubik’s cube tell us about post-World War II capitalism?

The end of history?

What in the end? Does it? Is it possible to make a good society? If every nation, every community, and even every individual across the globe assigns a different value to the tradeoffs of social solidarity and individual freedom that define economic systems, how do we predict the future of world economies? Hundreds of economies operate side by side and each has advantages and disadvantages that can’t be measured.

Professor Stuart says that we are not at the end of history and that many of the questions we ask today will be asked in the future. It is not a final form of human government or the ultimate economic plan, but rather the opportunity to uncover the ways societies have shaped the world to fit the boundless ideals that make a good society.