Capitalism vs Socialism

The more people from various countries have access to information and means of communication, the more they talk about the differences between the states they live in and the ideologies which are supposed to make the world a better place. Capitalism and socialism are two extremes which have always knocked heads and divided everyone into two very well defined groups.

Definitions

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Capitalism is a profit driven economic system, built on private ownership of production means in view of capital accumulation, a wage system and competition. The ideology behind it is that of free markets to the benefit of which a state is rearranged. In a capitalist state, everyone is responsible for the money they make and for their own prosperity. In theory, things are arranged so that people have access to high paying jobs, are competitive and result driven.

There are various types of state intervention, and capitalism has been adapted to many forms of government. Capitalist interventions are usually limited to matters regarding competition and regulations for market growth. After some countries experienced an economic boom in the 80s and 90s, capitalism was thought to have been the solution, but the economic crisis turned it into the burden of consumerism, a side effect of civilizations having been raised to support a growing economy by purchasing more than they needed.

Socialism on the other hand, is more people oriented. Often mistaken for communism, socialism is the ideology of which communism is the extreme manifestation. Ownership of means of production and of the products is social. There is cooperative ownership of everything. Since there is one owner, there is no competition, no drive to success. The entire society is seen as one big organism pulling in the same direction in view of economic growth. Responsibilities and wages are leveled and equally distributed.

More and more countries are looking to socialism as a way of taking care of the problem of the people who keep being left behind in all cultures, in all stages of human development. Socialism means making sure that everyone gets at least a small share of the goods, but later on it translates into everybody getting that same small share of the goods and not being motivated to move past a certain condition by not having the means or the possibility to do so.

Capitalism vs Socialism

So what’s the difference between capitalism and socialism then?

The dark side of capitalism led to the economic crisis the whole world plummeted into in 2008 when people borrowed more than they made and could not pay it back and purchased more than they needed. At some point, uneven wealth distribution led to 1% of the population having more than the other 99%. Like capitalism, socialism has been adopted in various forms, but while aggressive capitalism turned into empty consumerism and a race for gaining and spending, socialism runs the risk of turning into a hijacking of the commonly shared resources and means of production by those responsible for administering them.

In capitalism it’s competition over monopoly, lack of intervention over social aid, economic growth over waiting for everybody to get a fair share. Socialism has a more humane face, which is the main reason why people are being more and more attracted to it. Production is set to meet human needs, the people are cared for through extended social programs and they are equal, as opposed to capitalism, which creates classes built around their income levels.

Comparison Chart

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