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A
Comparison of Capitalism and Socialism Economic Systems: Outline
Title:
A Comparison of Capitalism and Socialism Economic Systems: Outline
Thesis: Capitalism and socialism economic
systems are both crucial systems that affect the socioeconomic factors of a
society because they determine the type of policies a government adopts to
serve its citizens in terms of income inequality, personal freedom, class
stratification and social justice.
1.
The first distinguishing factor between
capitalism and socialism is the level of personal freedom whereby socialism
leads to concentrated power of the government while capitalism offers autonomy
to the people.
A.
In a capitalistic economic system, individuals
assess what is to their benefit or detriment because responsibility is given to
a person (Murtaza, 2011). Therefore, capitalism allows for greater personal
fulfillment.
B.
Under socialism, freedom is aggregated whereby
good is defined as “good of the collective” which takes away personal autonomy
to choose and reduces the “needs” of an individual to be less that the “needs”
of the society (Bradley & Donway, 2010).
2.
Capitalism focuses on profit making through
exploitation while socialism focuses on people working together to meet
collective needs.
A.
Capitalism uses exploitation of
workers and resources to maximize on the highest profit possible. Exploitation
is done by the wealthy to subjugate people and societies and extract surplus
value (Nelson, 2016).
B.
Under socialism the wealthy
ruling class cannot enrich themselves at the expense of ordinary people because
the society makes decisions together on an equal basis.
3.
Another main difference between capitalism and
socialism is the level of income inequality caused by each system
A.
Socialism reduces income inequality because it
individuals are no longer held back by class restraints such as poverty (Exner,
2014). Socialism presents opportunities for the disempowered and does not
confine people.
B.
Capitalism creates a huge
income inequality because it favors people of a certain class status who have
access to opportunities. The 1% earn hundreds of times more than the 99% yet
the 99% do the hardest work for the 1%.
C.
Capitalism makes the rich 1%
population richer while making the 99% poor population poorer. The inequality
in a capitalistic society is produced by the wealth gap initiated through
capitalism.
4.
Another striking difference between socialism
and capitalism is in regard to social justice.
A.
Capitalism places money and
profits above moral judgment and ethics by promoting greed and promoting the subversion
of human rights (Fagerberg, Srholec & Knell, 2007).
B.
Socialism places some degree of
moral compass to the activities of individuals and corporations and promotes
human rights.
5.
Capitalism leads to class stratification which
determines how individuals are treated while socialism advocates for a
classless society of equal participants deserving of equal treatment.
A.
Capitalism divides people into classes that
are predetermined by access to opportunities in society whereby high
socioeconomic status affords individuals better treatment than their lower
socioeconomic status peers.
B.
Socialism is a classless system
where everyone is treated equally.
References
Bradley, R. L., & Donway, R. (2010). Capitalism, socialism, and “the
middle way”: A taxonomy. The Independent Review, 15(1),
71-87.
Exner, A. (2014). Degrowth and Demonetization: On the Limits of a
Non-Capitalist Market Economy. Capitalism Nature Socialism, 25(3),
9-27. doi: 10.1080/10455752.2014.882963
Fagerberg, J., Srholec, M., & Knell, M. (2007). The
Competitiveness of Nations: Why Some Countries Prosper While Others Fall
Behind. World Development, 35(10), 1595-1620. doi:
10.1016/j.worlddev.2007.01.004
Murtaza, N. (2011). Pursuing self-interest or self-actualization?
From capitalism to a steady-state, wisdom economy. Ecological Economics, 70(4),
577-584. doi: 10.1016/j.ecolecon.2010.10.012
Nelson, A. (2016). “Your Money or Your Life”: Money and Socialist
Transformation. Capitalism Nature Socialism, 27(4),
40-60. doi: 10.1080/10455752.2016.1204619
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