Jamal is a graduate of Northeastern Seminary and writes on a broad range of topics. His writings are based on other points of view.
This is not meant to be a socio/political overview. It's meant to be an examination of how I observed people's reaction to an ongoing argument I’ve been involved in. The subject in question is the ongoing debate between socialism and capitalism. Just by mentioning them, you probably already have a good idea of what some of these opinions are. The last few months, it's come up amongst several people I’ve talked to, both in person and online. I’ve listened to the now-dogma arguments for both. I call it ‘dogma’ because it's almost a repeat of what someone else has said before, not that it invalidates the person’s authenticity. Just that it's a rational that they’ve accepted for one reason or another as gospel.
From Movie Clips. 1987's Wall Street speech about greed and capitalism.
In the Right Corner
Beginning with the roots, capitalism’s official definition is : “an economic and political system in which a country's trade and industry are controlled by private owners for profit, rather than by the state.” , according to Oxford Languages.
When I’ve talked to average people about it, this definition becomes more opinionated. Oftentimes, I’ve heard it defined to me as the right of the individual to make their own money and keep it, without any kind of oversight or regulation from a national government. This is often followed up by the subsequent sub-definition of that same individual not having to give money away or to any group, cause, or individual. No matter how humane or morally correct it might be.
That last bit is important because that's often been the crux of pro-capitalist’s hostility towards socialism, and by extension for some, Millennials, who are stereotypically portrayed as socialist-in-training. This faction also likes to bring up that it’s capitalism that promotes commercial growth and prosperity. The competition of one rival to beat out the product of another is what forces the engines of ingenuity to make better, bigger, or more efficient items. This includes just about everything in modern 20th and 21st century society: light, electricity, cars, ships, planes, medicine, computers, and so on.
There’s also been a more base argument that I’ve heard as well that the former implies, but is less blunt. That argument is summed up in one word: freedom.
The idea and practice of an individual keeping what they make has been interpreted as an extension of the Western idea of free will, or not being beholden to another’s control or rule of what you do, own, or how to live your life. When I watch people who hate Democrats and social programs designed to help the underprivileged, freedom is the the most common phrase I see appear, other than calling those people ‘communists’ and ‘socialists’. Two of the worst things you could call anybody in American society especially.
The United States is the poster boy for this ideal. Both because of its self-promotion that it represents freedom based on its historical foundation, and because it was arguably where capitalism most prominently ruled and influenced society. I could really trace this back to two eras: the Gilded Age of the late 19th to mid-20th centuries, and the ‘decade of decadence’ otherwise known as the 1980’s.
Though the actual system actually goes back much, much further in history, in both most pro-capitalists and pro-socialists’ minds, it was really defined by these two time periods. The Gilded Age is the time in America right after it’s Civil War ended in 1865, where American industry exploded thanks to the pioneers of names like John Rockefellar, Andrew Carnagie, J.P. Morgan and right up to Henry Ford along with the discovery of oil and westward expansion.. Most average people would only know these men by their last names because of the empires they built decades ago.
This era was by far not only where capitalism grew the fastest, but also was at its most ruthless and uninhibited form. Seriously, people complain today about greedy corporations with their tax bailouts and legal loopholes over the government. But that was nothing compared to what went on here where these people you could argue literally got away with murder. Injuries and deaths amongst factory workers was rampant. Tycoons would regularly employ thugs from groups like the Pinkerton Security to intimidate and beat up unions and strikers. Corporate back-stabbing and corruption was the norm, and it even went as far as the rival economic empires funding their own presidential candidate in the form of one William McKinely in the 1896 Presidential Elections.
"Most bad government has grown out of too much government."
— - Thomas Jefferson
I selected the 1980’s as capitalism’s other high point because it is where the market diversity exploded. While not the naked ambition of the early part of the century, big business grew and expanded thanks to tax cuts from President Ronald Reagan, the explosion of technologies into people’s homes, and the ‘spend, spend, spend’ mantra many Americans were adopting when they couldn’t really afford to. To paraphrase the word’s of WallStreet’s Gordon Gekko, “greed was good”.
The American market in particular became so powerful and garnered so much influence that it played a large part in the fall of the Soviet Union. U.S. television shows that paraded fast cars, gorgeous women, and profitable people, were pirated in Eastern Europe and the USSR and the people wanted what we had. It was in large part what inspired so many people from that region to defect at the risk of their lives. Que the fall of the Berlin Wall in 1989 (yes other factors were involved as well). Compared to what most of the world had, America looked liked fucking El Dorado on a continental scale.
Greed worked. To many of the pro-capitalists I’ve spoken to, this was capitalism- and by extension America’s, true golden age. And I think it was largely this time more than any other that shaped the modern perspectives of capitalism, given how much the decade is nostalgia-lized in the years following. Including today.
From CNBC. "Why Democratic Socialism Is Gaining Popularity In The United States", 2019
And In the Left Corner
Oxford Languages defines socialism officially as, “a political and economic theory of social organization which advocates that the means of production, distribution, and exchange should be owned or regulated by the community as a whole”.
However, like with capitalism and freedom, socialism too is also blended with other ideologies, communism and marxism, to the point where the average person doesn't think to separate them. They’ve become interchangeable to the truly uninitiated and especially their free-market opponents, who usually automatically assume that socialism means government control rather than control of the people. That's actually quite an important distinction.
According to the idealist socialist, everything in society is owned by the society. There is no ‘me’, but ‘we’. Many of my friends have called themselves socialists. They point out to me areas where capitalism has not only run the economy into the ground because of the accumulated debt- a remnant of the 1980’s,- but how it also leaves others behind to fend for themselves in critical areas like universal healthcare. People in need of hospital care have to either get the money themselves, dependent on their jobs if they cover medical expenses, or just suffer. That’s just one example I was given.
While they appreciate the ideals of freedom just as much as their rivals, the pro-socialists I’ve spoken to have no trust in a system they feel is designed to leave others behind. Some form of accountability is needed so that everyone has a chance to succeed and/or get the help that they need, if needed. Not just the few who are left over who become part of the now infamous “one-percent”.
Like capitalism, the idea of community-shared resources is also nothing new, yet is defined in most peoples’ minds by it’s explosion concurrently with communism in the last century. It actually became known as ‘socialism' during the 19th century, but was at the time more of a political philosophy. A much maligned political idea.
Coined by philosopher Karl Marx, his version of it, along with communism and marxism, was formed as a reaction to existing economic, social, and political structures in Europe. He saw the political/social hierarchies creating divisions and ranks within the people. So he developed his theories as a counter to it. Socialism as he defined it, was part of a three-part evolution beginning with marxism - the recognition of class-warfare, socialism - the moving of all resources to the control of the people, and communism- the resulting structure that arose from this evolution. The old systems that created the suffering of the under- classes and the disparity of wealth would fall to allow a utopia to thrive.
While many of my socialist friends are not so naïve to believe in a utopia exactly, they do think elements of it like universal health care and taxation of the rich, would help them be in a better place. As well as better promote social values of equality and economic fairness that they believe capitalism only fostered and hid. Those of them who have travelled overseas were often fond of pointing to modern Europe and Canada as the embodiment of this ideal and a direct, tangible contradiction to the pro-capitalists’ argument that there have been no successful socialist countries.
"The profit motive, when it is sole basis of an economic system, encourages cutt-throat competition and selfish ambition that inspires men to be more concerned about making a living than making a life."
— - Martin Luther King Jr
The first thing I tend to notice when listening to both sides is that their arguments have little to nothing to do with the validity of the ideologies themselves. By this I mean that while they bring in factoids from the philosophes to back up their claim, their chosen words and emphasis tends to be more about self than any superior morality of the idea itself.
This variance arises when I see solid arguments made against their beliefs. Pro-socialist do often tend to be ignorant of the fact that many of the little things they have like cellphones, computers, and the music they listen to are a direct result of capitalist competition. Even though they may be suffering under the same system.
They can also be unaware that small businesses make up a larger portion of the capitalist economy than the stereotypical wall street suit, though they do corner much of the wealth. Higher taxes on the rich may by proxy include them and shut them down. And they often tend to ignore the experiences of people who have experienced failed attempts at socialism that resulted in violence and revolution. Talk to Cubans in Miami or eastern European defectors about that. That is often why they tend to be the staunchest Republicans.
Likewise, many pro-capitalists I’ve spoken to when they bring up the no-successful-socialist-country card, often tend to ignore the prosperity of European countries like Scandinavia that seem to employ it. While not having a pure socialist system like Marx proposed, do employ elements of it regarding some government control over resources and social welfare programs. And that brings up an interesting point about those countries.
If capitalism is so great as their supporters say, how is it that other countries use a system that adopts many socialist policies, and still manage to find themselves in arguably better positions than the United States?
I got into one argument online with a German when the issue of socialism vs capitalism was being debated. Someone had played the Europe -card to criticize the United States and I backed them up on that. The German said in no uncertain terms that Germany was NOT socialist and that he didn’t like how people kept thinking of them as such. So I asked him what they were then, to which his answer was something along the lines of having private businesses, but definitely not like America. But technically the term is referred to broadly as social-democratic.
Lastly, few pro-capitalists speak to the results where socialist programs have helped people in need. And they used it to better their situation so that they could get off it. Rather, they often only tend to focus on the failures where many people have taken advantage of the society’s goodwill.
Side-Stepping the Storm
I don’t think either side is truly autistic. I think they’re both rooted in what they can get out of the system or what it will cost them. Let me be clear that this not to say that I’m judging them as good or bad. Rather, the essence of their argument lies in the ‘I’. And some of you may be saying, “of course dumbass!” But given that neither side that I’ve spoken to brings that up unless I press them on it, says something.
What I’m saying is that whether either system has positives that could potentially benefit society as a whole does not matter. Whether it's national competition or having a strong social welfare system, the only thing of priority that matters is how it affects them (I mean this ammorally). What matters is that there's going to be a bill in one form or another and someone has to pay it. There isn't anything necessarily good or bad in that, as all biological creatures with self-awareness will naturally seek out the environment that best supports them.
Perhaps the only exception I can think of to this observation is Bernie Sanders. Though officially a democrat, he’s become both famous and notorious for being a socialist, even by his own admission. However, he also has a long track record of not only standing up for the values of the common people, but also has been willing to back it up, with his most recent example of criticizing Israel for its new war with Hamas, despite being Jewish himself. Though this along with other stands, has definitely cost him, it has also earned him the social clout that many politicians wish they had. They have to be careful how they ignore him because they know he legit cred with so many people. Therefore his words, no matter how controversial or extreme, still carry weight.
It's arguable that capitalism at least recognizes this enlightened self-centeredness. It is often said that socialism’s main flaw is its naivety that human beings can be generous enough to share with the community as a whole: especially on a large scale with a large population. So from that perspective, those that get left behind are to the pure capitalist of the 19th century ‘collateral damage’ or ‘acceptable losses’. As long as it didn't affect them directly. The only times they often did truly get involved with their workers' affairs was when they started making moves that would cost their employers something, like unions, strikes, and yes, even attempted assassinations.
So I would have to say that I would have to go with Europe's’ social democracy model. My reasons being that it's the closest balance between the two extremes, while also not feigning any sort of moral superiority. Like I said at the beginning, I am aware that there are many, many more levels to this debate. But what I mentioned above seems to be the only aspects that get through to most people. And that’s what is usually remembered.
This content reflects the personal opinions of the author. It is accurate and true to the best of the author’s knowledge and should not be substituted for impartial fact or advice in legal, political, or personal matters.
© 2021 Jamal Smith
CHRIS57 from Northern Germany on June 06, 2021:
I am really impressed by your acticle and the unbiased thoughts behind.
Both capitalist and socialist systems (and those somewhere inbetween) need an organizing structure to function. And any system has to rely on the assumption that this structure (state, administration) is performing with utmost effectiveness.
We all know this is not happening and thus the capitalist clientele argues to minimize the state while the socialist side argues to improve (enhance) the state to better perform its duties. We shall see who does better with effectiveness.
My take on distinguishing capitalist systems is that the means for production, the assets are privately owned. This has a very serious impact if you look at economics from a dynamic perspective.
Whenever a system is getting out of balance, some self regulatory indicators will show. One of the most important indicators is inflation. Simply put, inflation decreases your buying power. But look at means for production, assets, stocks: They float up and down with inflation, while the pay check people who have to meet ends and get less.
And last paragraph is also valid for socialist systems. Inflation will not necessarily mean that goods are more expensive, here inflation means that there are less goods available.
Anyways, if you look at Norway (Scandinavia) or Germany you will find that over the years the social market economies have created a huge gap between those with wealth and those without. While the income (the paycheck) divergence is fairly low, the wealth is accumulated with fewer and fewer individuals. Simple explaination: If people don´t have to take care of their future in a nanny state, then why accumulate assets. By now, "socialist" Norway and Germany have a similar wealth GINI index as "capitalist" USA. Only: consequences for the 90% poorer population are much less dire.
Having lived and seen many countries and systems on our planet, everywhere you have the top 10% of the rich, but the living conditions of the poor 90% make the difference.