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What Is Socialism And Capitalism In Simple Terms?

Updated on March 5, 2012

What is Obama economically?

Obama's rise to power was nothing short of spectacular. It was so rapid that it left many of people playing catch up as to just who he was, but it is no longer difficult to understand where Obama is coming from economically and politically. Virtually all of his actions to lean toward a socialist economic and political position. Mr. Obama truly is changing America, but not in a way that is at all appealing to those that yearn for a fair capitalist system. Mr. Obama is what he is, a messiah to the socialists among us who have yearned for this day and a fright to the capitalists who see the last vestiges of capitalism slipping into the red waters.

Considering capitalism at its core consists of a belief in small government intervention in the free market, and reward of individual achievement, Obama could hardly be accused of being a capitalist. He is a liberal democratic socialist with visions of remaking America into Europe II.

Recent events are alarming for capitalists to say the least and they are left wondering how far this slide into socialism will go.

What is capitalism?

In short capitalism is the economic philosophy that economic growth is best sustained by the free market forces of supply and demand. It abhors artificial interference and manipulation from governments. Unfortunately or fortunately, depending on your political persuasion, capitalism has been a very rare thing in the history of man. Governments have never been able to resist the temptation to tinker, progressives never could stomach the inevitable social discrepancies that result from a healthy capitalism, and the greedy could not resist the temptation to scam the system. Much like socialism, capitalism requires an honest clientele to function correctly.

Party myths

It is a widely believed myth that Democrats lean toward socialism and Republican favor capitalism. Both parties have a vested interest in socialism, because socialism gives the government more control and governments crave control by their very natures. As George Washington said, "Government is not reason; it is not eloquence. It is force. Like fire it is a fearful servant and a terrible master."

The main difference between the parties is the speed with which they are consuming our liberties. The government has no will to curb its own aggression against personal liberty. The Republicans favor the slow train while the democrats ride the express.

In a recent online edition of Pravda, Stanislav Mishin wrote, "It must be said, that like the breaking of a great dam, the American decent into Marxism is happening with breath taking speed, against the backdrop of a passive, hapless sheeple, excuse me dear reader, I meant people. "

The question is: What do the people want?


This economic philosophy comes from the works of Karl Marx, a German philosopher and political economist. In simple terms socialism is an economic philosophy preoccupied with economic equality for all workers. Theoretically this would be accomplished by a benevolent government to whom everyone would give their money and in return it would distribute it evenly among the body politic and everyone would live happily ever after. As Karl Marx wrote, “From each, according to his ability; to each, according to his need”.

On the surface it sounds very caring and benevolent, but as with capitalism it has never been successfully achieved because it to requires a selfless society and incorruptibly government in order to be properly prosecuted.

When both systems fail.

When socialism fails it can leave a residue of totalitarian governance or merely implode into a a social democracy that limps along after receding dreams of utopia. We in America need to ask ourselves if we want to become another Europe? If so why?

When capitalism fails it will self-correct, if it is left alone, because it is based on the native desire of the human spirit to survive and even thrive. Its failures can and will be painful, but pain has a purpose. Capitalism can only completely fail when it is arbitrarily replaced by another system of economics. This is what is happening in America now. We are financing the loss of our own liberties for the safety of servitude. Is this trade worth it?

People who are able bodied and of a sound mind will always find a way to survive and thrive. Socialism did not arise in Marx's brain because there was a successful capitalism, no, it arose because of an abusive aristocracy in Europe which monopolized the economy. The better cure would have been to provide access to capitalism for all citizens instead of creating a new benevolent aristocracy to administer the public money as it saw fit. This model ravaged eastern Europe which still bares deep scars and wounds from it today.

by User Musphot on Wikimedia Commons
by User Musphot on Wikimedia Commons

Power or Benevolence

 There are always those who think that they can fix the problems of others; that they can come as christs of reason and cure society of inequality, greed and avarice, but beneath the surface of every human heart lies the deceitfulness of power. 

I am sure that Mr. Obama believes that his brand of socialism is the true mythology of hope and that his understanding of the human condition is essentially correct and a little more than half of the electorate in America either agreed or didn't understand where he was coming from.  I do not believe that any American President takes the oath of office in order to perpetuate harm on the nation, but regardless of their intentions, their ideologies that lead to certain actions can and have been injurious at times.  I believe that our misguided fascination with socialism springs from the heady days of progressive change that occurred post WWII and did in fact change some things that needed changing in this country, but like the mythological magic churn that churned out so much salt it turned the sea salty the progressive movement can never recognise when its work is done and like that magic churn it cranks away with its societal cures whether we need them or not.

Educating ignorance

Part of the problem is lack of unbiased education. Progressives founded and have been in charge of our public educational system since its inception. Again I want to reiterate that I do not believe that progressives wish harm on the nation, but instead are driven by a sort of arrogant belief that the end justifies the means and that they, better then others, can see what that end should be. Because of this, the teaching of history has slowly eroded into a narcissistic self-flagellation designed to exorcise the demons of guilt that they believe rest upon our society because of all of its excesses and abuses. Anything negative that can be discovered, inferred, or assumed about any historical figure that took an important part in the founding of the United States is exploited in the practice of national penance. The revision of history covers the spectrum of selective propaganda to outright re-writing of events. The result is ignorance of the facts and an inability on the part of Americans to make informed choices. And this is all a part of the way socialism works. It consistently strives to even out society according to its handlers views. Unless you trust the handlers to inform you of the way the world is you might not be so eager to follow their economic plans.

The capitalist way.

Our current economic situation can be used as a good example of how capitalism might have worked. In fact there is a good chance this crisis would be much less aggressive or not at all had market forces been allowed to work from the beginning instead of having the Government in bed with Freddy and Fannie in the first place. That being said, what would have happened if we had just let the market punish bad choices? It would have been painful, but it sure would have been educational and on the other side of the crisis we would have been a much chastised and stronger people. As it is now the Government is jumping in with borrowed money, that we and our children will have to pay back, to pay off the mistakes of its supporters and cronies. All the while swallowing market shares of private companies and setting up wage czars to monitor compensation. All of this from an institution that in recent years has consistently demonstrated the worst fiscal responsibility and out right corruption. Who would trust the Government to run anything right?

Americans, do we want socialism? Do we want to turn over our liberties to a "fearful servant and terrible master?" Do we want to assuage our conscience of guilt by turning over our right to choose how we show charity to a bureaucracy? Do we want to be told how to live, what to believe, and who our doctors will be. If we the people do nothing the Government will stop at nothing.

Your opinion.

Do you favor a capitalist economy or a socialist economy?

See results


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    • adagio4639 profile image

      adagio4639 2 years ago from Brattleboro Vermont

      " You are confusing the term liberal in its classical sense with modern day liberalism, which as you have admitted is progressivism."

      First of all, I'm not confusing it at all. I simply reject the notion of "classical Liberalism". It assumes that Liberalism stayed in one place. Liberalism never stays in one place. We call it "classical liberalism", because that was what liberalism looked like in it's early period. Certainly those that were liberals at that time, never called it "classical". Liberalism always changes. That's it's very nature. It's not ideological, as we've discussed before. It's philosophical. The Enlightenment is a liberal philosophy. There are many variants of that philosophy. Utilitarianism for example. There is the "classical utilitarianism of Bentham. And the Neo-classical version of John Stuart Mill. Both however, are a result of the Enlightenment (which is liberal), as is Marxism, the Social Contract, and Democracy itself. The very idea of "classical liberalism" implies a liberalism that stopped evolving. That's not liberalism. That's a conservative idea of Liberalism. Conservatives resist change, and they'd prefer to leave liberalism where it was in the 18th Century. But it never stays in one place. I kind of think of Progressivism is to Liberalism, as Libertarianism is to Conservatism. They share certain elements of Liberalism and conservatism without really being either.

      Furthermore, I haven't admitted that progressivism is the same thing as Liberalism. What I said was that it was being equated with Liberalism today. Progressivism is the term applied to a variety of responses to the economic and social problems rapid industrialization introduced to America. Progressivism began as a social movement and grew into a political movement. The early progressives rejected Social Darwinism which seems to be something that you seem to embrace.

      Many of the core principles of the Progressive Movement focused on the need for efficiency in all areas of society. Purification to eliminate waste and corruption was a powerful element, as well as the Progressives' support of worker compensation, improved child labor laws, minimum wage legislation, a support for a maximum hours that workers could work for, graduated income tax and allowed women the right to vote.

      According to historian William Leuchtenburg:

      " The Progressives believed in the Hamiltonian concept of positive government, of a national government directing the destinies of the nation at home and abroad. They had little but contempt for the strict construction of the Constitution by conservative judges, who would restrict the power of the national government to act against social evils and to extend the blessings of democracy to less favored lands. The real enemy was particularism, state rights, limited government. There is no such thing as "States Rights". It's a fabrication by conservatives. There is no reference to States Rights anywhere in the Constitution. People have rights. States have powers.

      There are areas where progressivism crosses over to liberalism but progressivism is much more ideologically driven.

      "I am using the terms as they are popularly understood today."

      I know. But that seems to have created a lot of misunderstanding of what these ideas represent.

      "I sure when you made this comment that you were unaware that in Marxist dogma, socialism is the lower-stage of communism."

      You're wrong. I'm totally aware of it. If you'd like a complete explanation of Marxism, I can provide that for you. For Marx, Capitalism eventually collapsed and is replaced by socialism, which is a kind of transitory state on the way to communism. He wants a world in which the free development of all, is the condition for the free development of the individual. If the condition for your freedom, is my lack of freedom, then we don’t have a free society.

      The central organizing concept of Marxism is actually the notion of exploitation. If your freedom is parasitic on or dependent on exploiting me, we don’t have a free society.

      Marx assumes that wages will always lead to subsistence. Why? Because there are always unemployed people. He calls it the reserve army of the proletariat. There are always unemployed people. That means, that if you refuse to work at a subsistence wage, I can go out and hire somebody else and fire you, so wages are driven toward subsistence. It’s an inescapable fact about Capitalism. It’s one of the few empirical assumptions Marx made that stands well logically. So…wages are going to be at subsistence.

      Marx’s historicism fails. He thought that Communist revolutions would come about in the advanced Capitalist countries. In fact the revolutions bearing his name came about in peasant societies, and the Advanced Capitalist societies didn’t fall apart either in the 19th century when he was expecting them to, or the 20th or the 21st. (How long should we hold our breath Groucho?) The formerly communist country of China and the Soviet Union are now Capitalist in a way that would shock Marx.

      "As for the rest of your comments, they are based on the classical definition of liberalism and therefore can't be applied to what I have written."

      None of my comments are based on the "classical definition of Liberalism". Either you totally misread what I'm saying, or you simply are lacking in your grasp of Political Science.

    • Christian Walker profile image

      Christian Walker 2 years ago from Maryland

      "It is an interesting fact that the Robber Barons of the 1800's gave birth to the liberal movement in the United States with it leanings toward socialism. "

      This is an undeniable truth when referring to the modern liberal movement in the United States. You are confusing the term liberal in its classical sense with modern day liberalism, which as you have admitted is progressivism. Of course the classical sense, being a progressive is itself limited to merely making progress along a given vector which, depending on where you are facimg, could be either. Liberal or conservative.

      I am using the terms as they are popularly understood today.

      "You say this: 'As Karl Marx wrote, “From each, according to his ability; to each, according to his need'. Yes Marx wrote that, but not in reference to socialism. He wrote that in reference to communism."

      I sure when you made this comment that you were unaware that in Marxist dogma, socialism is the lower-stage of communism.

      As for the rest of your comments, they are based on the classical definition of liberalism and therefore can't be applied to what I have written.

    • adagio4639 profile image

      adagio4639 2 years ago from Brattleboro Vermont

      "It is an interesting fact that the Robber Barons of the 1800's gave birth to the liberal movement in the United States with it leanings toward socialism. "

      That's not true. Liberalism was already well in place at the time of the Revolution, which was itself a liberal movement against the conservative monarchy of England. The Robber Barons didn't arrive on the scene until the very late 1800's. The very term "Robber Baron" first showed up in the August 1870 issue of the Atlantic Monthly. U.S. political and economic commentator Matthew Josephson further popularized the term during the Great Depression in a 1934 book by the same title. He attributed the phrase to an 1880 anti-monopoly pamphlet about railroad magnates.

      I think what you mean is that it sparked the "Progressive" movement, which very often is conflated with Liberalism. The term Liberal/Progressive today seems interchangeable but is actually quite different.

      You say this: "As Karl Marx wrote, “From each, according to his ability; to each, according to his need”. Yes Marx wrote that, but not in reference to socialism. He wrote that in reference to communism.

      His contrast between Socialism and Communism.

      • Socialism: From each according to his ability, to each according to his work.

      • Communism: From each according to his ability, to each according to his need.

      A Socialist society is one in which people would be rewarded on the basis of their work. (From each according to his ability, to each according to his work) Whereas Communism would a world in which need was going to be the best basis for distribution or redistribution. Everyone works according to their ability, but everybody’s needs would be met. (This sucks. Somebody or some committee will define

      what your needs are) So who defines “needs”? Accordingly some committee could decide that your needs are a matter of substistence.

      You need water. You need electricity. A roof over your head. There you are. Have a nice day.

      There are physical things related to survival. Marx believed something similar. His basic idea was that Capitalism’s historical task was to make possible the "Super Abundance", which would then make communism an option.

      He distinguished what we might call market consumerism; market based, market induced wants from genuine needs. He understands that capitalism generates consumerism. There wouldn’t be enough demand for all the stuff capitalism was producing. So it’s important to get people to believe they always needed the new thing, whatever that might be, through aggressive advertising. The market would always be there to keep the system going in order to generate the demand which keeps the whole thing afloat.

      But Marx thought once capitalism goes away, then all those imperatives go away as well, to get people to believe that they need things. To get you to believe that you’re a failure in life if you don’t get the 911 Turbo.

      All that would be gone and we could focus on the needs that Really matter to people as opposed to the induced wants of the market.

      "the progressive movement can never recognize when its work is done and like that magic churn it cranks away with its societal cures whether we need them or not."

      That's because it's work is never done. You seem to be under the illusion that at some point we have reached the perfect union. The Utopian State. The work of creating a "more perfect union" is never done. That would seem to underscore your own conservatism. Conservatism is always about preserving institutions, while liberalism is always about challenging those existing institutions. And liberalism is what gave the impetus for the American Revolution in the first place. It challenged the existing institutions.

    • profile image

      retief2000 4 years ago

      The reality that evades everyone that espouses a controlled or mixed economy is that all economies still function on the same basic principles no matter what the political state maintains. Supply and demand is not a matter of policy but a matter of reality.

      The so-called mixed economies are merely distortions of reality, which is why they always struggle to create supply and fulfill demands that are artificial and, therefore, unwanted by their society. It is the reason why electric cars sell so poorly in the United States, it is why there were massive surpluses and shortages in the USSR, it is why few European economies produce sufficient growth to provide jobs and it is why the Chinese economy is rife with corruption.

      Economics is not mechanics, though socialists and politicians would have you believe that it is. Economics shares far more in common with Mathematics in that they describe that which is rather than that which one wishes would be. It is a natural science that is governed by actual laws in nature. When the supply of water dwindles in one location the entire population of animals must find a new source of water, relocate to where the water is or parish. This is an economic question and cannot be merely legislated away by politicians and the lobbyists who seek their favor.

      Once one realizes that Economics is the natural science of how a population adapts to scarcity it is easy to see why everything but a free market system is inherently flawed and ultimately destructive.

    • Christian Walker profile image

      Christian Walker 5 years ago from Maryland

      Hi Georgia,

      Capitalism is more a s philosophy than a system. There are many economic systems that bear the title of Capitalism but there is only one philosophy that drives them.

      As Don Watkins put it, "Contrary to what we’re often taught, understanding capitalism is fundamentally a philosophic, not an economic, endeavor. "


    • profile image

      Georgia Washington 5 years ago

      Capitalism isn't a philosophy - it is a system of economic organization.

    • profile image 5 years ago from upstate, NY

      I think you have a pretty accurate discription of what's going on in America right now, Great Hub! The only thing that I might add is that today's liberals may lean more towards fascism than even socialism because they seem to want to get the state involved in every part of our lives but I think their content to control the private sector through regulation rather than direct control of the means of production.

      Good point about ww2, I think we drew the wrong conclusions as to our countries success during and after ww2. We falsely believe that government could do anything because of the war success and the economic boom afterwords. What we failed to see was that our economic success had more to do with being the only advanced industrial nation left standing after ww2, to supply goods to the world and little to do with government manipulations of our economy AKA keynesian economics!

    • internpete profile image

      Peter V 5 years ago from At the Beach in Florida

      A well written hub with very useful information. As you said, Obama's rise to power was so swift, no one knew what he stood for or thought. Only now, after he has been president, do we know what kind of policies and government he wants. How sad is that? What company/business would hire a CEO where their best trait was no one knew them?

    • Christian Walker profile image

      Christian Walker 6 years ago from Maryland

      Hmmm? According to the time/date stamp on your comment...It was written March 5, 2012.

    • profile image

      myrrh 6 years ago

      how long ago was this drivel written?

    • Christian Walker profile image

      Christian Walker 6 years ago from Maryland


      Wouldn't it be amazing if we actually had a president who understood that the executive branch of our government was suppose to execute the laws of the nation.

      Alas, what we have devolved into is an executive branch that is more intent on making up its own legislative agenda while ignoring the laws that are already on the books that do not further its own power.


    • JON EWALL profile image

      JON EWALL 7 years ago from usa

      Christian Walker

      ''What we lack in this country is honest statesmen''.

      A very true statement that shows up in Washington, state and city government. Today, wrong is right and right is wrong. President Barak '' I '' Obama said that he was disappointed that the DREAM ACT was not passed.Apparently he still doesn't understand immigration law as it is written.

    • Christian Walker profile image

      Christian Walker 7 years ago from Maryland


      What you say is true not only at the government level, but at every level of society. The wealthy doctor on a local church board will have his way more often than the poor parishioner who probably won't even be invited to be on the church board.

      This is human nature and is present in all economic systems. I would argue that it is exacerbated in socialist systems where the peasants are literally relegated to the soup line while the politburo eats caviar under chandeliers.

      It amazes me that people who dislike the rich in this country want to push us headlong from the frying pan into the fire. Forced Redistribution of wealth is NOT the way to go.

      What we lack in this country is honest statesmen who are not influenced by the big dollars knocking at their door. The problem lies with our elected officials and not capitalism. What makes anyone think that socialism is suddenly going to moralize our poilticians is beyond me.

      Why would you want to give the politicians who are already corrupted by money and the power it brings even more power to control the money in this nation. It is just crazy.

      We the people need to act and get off our duffs and elect honest statesmen who truly defend the constitution and capitalists free market principals.

      The big wigs like AIG and Chrysler should have just been left to fail. As painful as that might have been it would have been better for us and the country in the long run. Let the market do its work. Why was the government redistributing wealth to these wealthy people anyway?

      Let the free market speak!

    • DTR0005 profile image

      Doug Robinson 7 years ago from Midwest

      You made a point that Europeans come from a background, a history where aristocracy ruled based on birth right. However, in the US we have traded our kings and queens for the power of the dollar. We still have a class system every bit as difficult to penetrate as if it were by birth right only - in our case it's money. And we have bought into the myth that hard work alone can bring wealth. In some instances that is the case, but the power structure (wealthy) in the US have made it increasingly more difficult to rise in class status. We have the most unbalanced distribution of wealth currently that this country has ever seen. The last time there was anything akin to an equal distribution of wealth was during the Nixon administration during the early 1970's. Effectively the monied elite have been able to buy political favor. Example: If I call Senator Smith's office and offer to contribute $15.00 and Mr. Green calls with a $10,000 donation, who is going to get the politician's ear?

    • JON EWALL profile image

      JON EWALL 7 years ago from usa


      ''It's not the unions, it's the cost of American workers.'' LET'S NOT FORGET GOVERNMENT taxation and union salaries and pensions paid by the public for the public workforce.

    • profile image

      Mark 7 years ago

      Jon, that's a load of crap. I am from a right-to-work state without a strong union force, and the economy is no better today then it was 20 years ago when companies were looking for cheaper, non-union labor. It's not the unions, it's the cost of American workers. American workers cannot compete on a pay-scale with workers in Vietnam, Pakistan, Mexico, China, Indonesia, etc. Those countries do not require compliance with safety, health, and environmental standards that the U.S., most of Europe, and Australia do. Now, you may be against government intervention, and that's fine, but considering government intervention is what has led to the advent of child labor laws, anti-dumping/pollution laws and regulations, safe working environments, and non-discriminatory hiring/retention practices, I will stick with a little government intervention.

    • JON EWALL profile image

      JON EWALL 7 years ago from usa

      William Maloley

      ''Energy has made everything more expensive ''.Obama's way of weaning America off of foreign oil.

      The Obama administration is closing down all oil production in the gulf for at least another 7 months.Instead of creating jobs ,Obama is putting some 50,000 more out of work, destroying state economies and not issuing any shallow water oil drilling permits.

      Wake up America!

    • Christian Walker profile image

      Christian Walker 7 years ago from Maryland


      Why the clowns we elected, who run our country into the ground, don't understand this is beyond me.

      Or maybe they do?

    • JON EWALL profile image

      JON EWALL 7 years ago from usa

      William Maloley

      High union wages and government taxes force companies to move out of the country. Today we compete with the world and the world labor market beats ours.Simply facts to digest.

    • Christian Walker profile image

      Christian Walker 7 years ago from Maryland

      What you are describing is not capitalism. It is merely an economic aristocracy. And our Government is complicit in it.

    • profile image

      William Maloley 7 years ago

      The problems that we face today have been festering for 20 years. During WW2 we supplied the world with our manufacturing dynamo. Our companies that manufactured everything for everyone, switched their focus to wall street by being concerned only by the bottom line. They bought out smaller companies to destroy competition, laid off people who did the work and sent that work out of the country forcing most to live on credit that many could not pay back. Energy has made everything more expensive and as we become more energy efficient, those companies simply raise their prices to satisfy wall street and

      CEOs. Capitalism was the vehicle to benefit everyone, but now it only benefits the few and that is the problem of capitalism today.

    • JON EWALL profile image

      JON EWALL 7 years ago from usa

      Christian Walker

      A WELL WRITTEN HUB. It's all about money, power and greed. Politicians are elected with financing from special interest and lobbyist. What and who Barak Obama is was not reported by the mainstream media. Obama promised change was coming to Washington and indeed it has. Members of the present Congress have not honestly performed in their duties to provide open transparent Government. the President lies, Congress pushes thru legislation without reading or debating. Promises by the leadership are hollow and uncaring for what the people want.

      Wake up America, go to the poles and vote the bums out!

    • Jeremey profile image

      Jeremey 7 years ago from Arizona

      Helped me clear up a couple misconseptions I had between the two. Educational, well written easy read and comprehend. I'll read more hubs of yours.

    • profile image

      Chris 7 years ago

      Capitalism has spawned Corporatism.... I think that you hit the nail on the head.

      When describing Capitalism, you stated that [it] " It abhors artificial interference"

      Corporatism ensures that there IS artificial interference.

      There are no laws made in this country any more that aren't passed with the consent of corporations.

      The struggle with the English is so engrained in American's genes that they cannot plainly see that it's the Walmarts, Home Depots, Sonys and McDonalds of the world that are the enemy.

      I don't understand the opposition to health care after giving out all these bail-outs to the banks, and car companies. Instead of protecting "the people", America has protected the new enemy.... Corporations....

    • TheManWithNoPants profile image

      TheManWithNoPants 7 years ago from Tucson, Az.

      Dude! What a well thought out, well written piece. I'm freakin impressed. I was going to do a hub on this, but you said it all. One of the things I like about your style is, like me, you don't bash anything, you just lay it out and make the reader put it together. Good work man.

      Oh yea, I'm sick when it comes to racquet ball. I love it and play at least five and usually six days a week. It's my cardio cause man I hate jogging. But I do run ten minutes of wind sprints after racquet ball.

    • Christian Walker profile image

      Christian Walker 7 years ago from Maryland

      I agree, and it is only getting worse. The fact is, corporatism can thrive with any type of government whether it is China, or the USA. There should have been no bail out period. This violates the very basic premise of capitalism.

      I think a lot of people who fancy themselves as anti-capitalists are really anti-corporatist.

    • Metalhobbit7 profile image

      Metalhobbit7 7 years ago

      we currently dont have capitalism in this country. we've got corporatism, a nasty little system that combines corrupt government and greedy business into one shit-sandwhich. the market and the government should be seperated like church and state.

    • Christian Walker profile image

      Christian Walker 8 years ago from Maryland


      I clearly state in this hub that:

      "In short capitalism is the economic philosophy that economic growth is best sustained by the free market forces of supply and demand."

      It is very clear in my hub that capitalism is an economic philosophy that is separate from democracy. In a democracy the people may choose a capitalist economic philosophy or not. Or they may choose a mix which is what most democracies do.

    • profile image

      dfager 8 years ago

      Capitalism is not a form of government at all, it's an economic system. China has a communist government but it embraces capitalism as an economic system. So this hub makes an incorrect argument.

    • Christian Walker profile image

      Christian Walker 8 years ago from Maryland

      I think in general people mistake aristocracy with capitalism. Capitalism is the opportunity for anyone to rise from rags to riches by their own abilities. "A few chosen wealthy capitalists" is an oxymoron. A wealthy capitalists is not chosen, but made. Those that cheat the system should never be confused with capitalists. They are the same as the communists that used to eat caviar in the pollitt bureau while the peasants line up for borscht and black bread.

      If someone is chosen it begs the question as to who does the choosing because that is where the real power lies!

    • Hussains profile image

      Hussains 8 years ago from Olympia, WA

      A very well written logical article. In my view a true democracy should give voice to its people not to a few chosen wealthy capitalists. Nations are built on the strength of their people not on the shrewdness of a few exploiting the majority and getting richer every day, while the poor work hard and remain poor.

    • Christian Walker profile image

      Christian Walker 8 years ago from Maryland

      Ivan The Terrible, You need to stop confusing an aristocratic economy with a capitalist economy. Robber Barons, European Aristocracy, and Feudalism are all interrelated and engage in the power class subjugating and profiting off from the peasant class. Socialism works the same way. You have the ruling class in the posh politbureau dictating how life is to be lived to the working class in the fields. True capitalism is open for business for anyone who wants to go for it.

      Nature in the macro sense has always operated in a capitalistic way. If you believe Darwin, we humans have achieved predominance in the natural world because of natures capitalist approach which favored survival of the fittest and how I ironic is it that once this fine achievement was accomplished the human species turns to strike at the very core of what made them great.

      True capitalism is amoral. It is just an economic system that can become filled with either honest or dishonest proponents, and that is true of socialism, aristocracies, and any other form of economy. It is not an economy that creates immoral people but instead it is immoral people who create oppressive economies regardless of the model.


    • Christian Walker profile image

      Christian Walker 8 years ago from Maryland

      Beyond Politics, I think you greatly underestimate Obama's penchant for socialism and overrate his pragmatism. Just take a close look at those he calls his heroes and those he surrounds himself with. A good pragmatist would immediately abandon this suicidal health care debacle. Only a socialist would push on because they believe that they know best when it comes to public policy. There is very little about Mr. Obama that can be defined as pragmatic. Those pragmatists that still believe in Mr. Obama are in for a serious case of buyers remorse in the near future. Only socialists will be left cheering on the benevolent enslavement of of the American peasants by the new politbureau in washinton.


    • Ivan the Terrible profile image

      Ivan the Terrible 8 years ago from Madrid

      Capitalism as it was practiced here in Spain before Franco died was a "me-first and only me" system of economics. And the me-firsts were all the wealthy land owners who refused to allow new members into their ranks. Therefore it was a very closed capitalist group, with everyone else left to fight over the crumbs falling from the table.

      I know that early Capitalism in the U.S. was much the same, men of great ambition who more or less took what they wanted and took terrible advantage of the workers.

      There are those who yearn for the "good old days" of robber baronism. I, for one, would rather see a time when people are able to better themselves through education and community service, through making the world a better place for all, not because they get something for the effort, but merely because it is the right thing to do.

    • Ivan the Terrible profile image

      Ivan the Terrible 8 years ago from Madrid

      I agree that capitalism does allow for an individual to make his or her situation better, but if one is not capable of such a thing, for reasons of education or other reasons, then one can easily find one's self like a character out of a Dickens novel. In short, capitalism does not by itself tend to the business, as Scrooge says, of humanity.

      Pure capitalism is not the friend of society - it is the friend of business, and business, without restraints, rules and guidelines, can be very self- absorbed and cruel to an individual. It can work both ways. Just look at the history of highly capitalistic societies and you will see that people are often left poor and destitute because they will never get the chance to make it on their own. And as happened in Europe, poor people with no hope often turn to becoming revolutionaries in order to end their miseries.

      A mixture of ideas from differing economic systems seems to balance things out so that people who can't fend for themselves can at least not die of starvation in the streets, and people who are more entrepreneurial can find their way into their area of growth.

    • profile image

      gryffon 8 years ago

      I think everybody is missing the boat. No government exists that isn't corrupt to some degree. To argue the merits of one type over another is moot as long as they are operated by corrupt practitioners. Since we'll never ever really remove corruption from the system, we have to make do with what works best for all involved. I favor capitalism because I believe it offers the best opportunity for any individual to prosper from any given event whether it be an ah-ha moment, a "what if I-" moment, a "how can I-" moment, or a "If they do this, then they'll need that" type moment. The incentive is there to improve oneself in a capitalist society.

    • Beyond-Politics profile image

      Beyond-Politics 8 years ago from The Known Universe (

      I believe Obama is cut from the same mold as myself...a pragmatist. Policy should be based on need, not ideology. Whenever you limit your methodology, you limit your potential for success...use what works to fix what's ailing. The idea of lassez faire capitalism is just as much as a failure as socialism; neither system has worked, especially in light of the fact that both systems have been historically too riddled with corruption to embrace the notion that one is better than the other.

    • Christian Walker profile image

      Christian Walker 8 years ago from Maryland

      The Robber Barons and their monopolies do not represent capitalism but instead are just a variation on the aristocracy of Europe. The haves allow the have-nots to live at their pleasure which also mirrors socialism where you have a ruling class and a dependent class. i.e. The old Soviet Union where the members of the politbureau dined on caviar and fine French wine while the workers stood in long lines to buy hard brown bread.

      It is an interesting fact that the Robber Barons of the 1800's gave birth to the liberal movement in the United States with it leanings toward socialism. All of the children of the Robber Barons who lived in Mansions that they tried to make look like the European Aristocracy's lodgings, along the Hudson River used their parents money to finance the salvation of the American Poor. Only that did not happen. Instead it created a bloated Government bent on interfering in every aspect of its citizens lives.

      True capitalism is the idea that everyone is free to compete in the pursuit of happiness with out the interference of a nanny state. We are free to succeed and we are free to fail. The funny thing is that this system mirrors what is found in nature more closely than any other system on the earth. It is also what propelled the USA to become the world's only super-power. As we turn our backs on that system we will also fall from that position. Then where will the rest of the world long to go?

      I guess we will have to give the Statue of Liberty back to France.

    • Ivan the Terrible profile image

      Ivan the Terrible 8 years ago from Madrid

      I was rereading my old history books and remembered a thought I had decades ago - Capitalism was not around when the U.S. was created. Merchanitilism was, however, and perhaps it was a form of what later became Capilatism.

      If I read my texts correctly, Capitalism came about in the middle and late 1800's and reached its peak with Robber Barons and the anti-monopoly crusades.

      So why this marriage to a system that basically rapes the poor and devours the innocent? Why do so many Americans love Capitlaism when all it has done is feed you to the lions? Not that pure Socialism is all that great, but the blend of the two seems to round out the whole picture.

      I truly believe it is a left-over of the 50's and 60's when Communism was often mistaken for Socialism because the old Communist nations called themselves Socialist, even though they really weren't.

    • Christian Walker profile image

      Christian Walker 8 years ago from Maryland

      Hello Elger,

      I am not sure exactly what you trying to say. The United States is neither a fully capitalist economy or a socialist economy. Instead we waver between the two. One can not argue which system is better unless they hold common ground on what they expect the outcomes are to be.

      If a person wants a nanny state to take care of them from the cradle to the grave and they are willing to give up the autonomy in order to have that security then, for them, socialism would arguably be the best system. On the other hand if a person wanted to be set free to compete, to make their own destiny, and define their own success on their own terms then capitalism would be the best choice.

      In the USA we have both groups and we who value freedom and autonomy far above state provided security are in a fight to bring capitalism back as far as we can. Capitalism, in its unaltered form, leaves everyone alone, whereas socialism meddles in the lives of all citizens robbing them of freedom and self actualization.

      A socialist can live quite unmolested in a truly capitalist society, but a capitalist can't live unmolested in a socialist society. Thus we have this culture war going on in the USA.

      As for Bush II he was not a pure capitalist and in regards to the charges you laid against him, I can't respond to them without knowing the basis on which these charges rest. Are they merely your frustrations being expressed as an opinion or do you have factual evidence of his malfeasance?

      Best Regards


    • binspies profile image

      binspies 8 years ago

      Very amusing that capitalist writers call the USA a "socialism". Just recently the super oil mafia capitalist, mass murderer, torturer, thief and super lier Bush the II. has left over his robbed and dammaged contry .... and now you are a socialist country ...

      Also healthcare is a billion $ business and dead workers are also not wanted by capitalists. They need them to make profit. Just read Marx Communist manifesto (, to understand the world you live in. Especially the so-called "globalisation" has made his article up-to-date.

      Christian - do you write such articles to make money? You are a professional - isn't it?

      Kind regards


    • Christian Walker profile image

      Christian Walker 8 years ago from Maryland

      I think your comments highlight one of the most misunderstood aspect of most Americans. And that is, we don't want to be taken care of. We value independence over safety, security, and government parenting.

      We elected Obama as a reaction to the war in Iraq, our mistake was not understanding how much he was bent on socialism. Most Americans get two weeks vacation and 80% of these do not take their vacations. We are hard working and independent.

      Europeans come from an aristocratic background and have always lived in a world of the ruling class and the dependent class. But that has not always been true in America and my hope is that it will nor remain true for long.

      I am not saying one way is better than the other, just different and America has been traditionally a place that attracted all of the independent, hard working peoples of the world. The world needs a place like that, after all where will all of the socialized medical systems in Europe get their innovations if America joins them?

      We like an open road before us and have lives like blank canvasses on which we can choose what to paint.



    • Ivan the Terrible profile image

      Ivan the Terrible 8 years ago from Madrid

      Actually there is no such thing as Capitalism, and also Socialism does not exist. Both are pure theory, economic theory, and neither exists 100% in the U.S. Hell, even here in Spain we have a blend of these two ideas, but we change them to meet our needs.

      I prefer our blend, because I never have to worry about health care, retirement, and here people are happy to help us oldsters in our golden years. What does the U.S. offer people like me? A retirement home, boredom and a slow death? pablum for food and ineffective health care? And all this only if you have enough money?

      Every few months we go on trips to various places, eat out and have fun in our retirement years. We have weekly trips to museums, sporting events, musical plays, all expenses paid. I wouldn't trade this for anything the U.S. offers.

      Great hub!

    • profile image

      Karl Marks 8 years ago

      I agree also, but with the level of knowledge in the United States and the state of our educational system, what can be done?

    • TheMindlessBrute profile image

      TheMindlessBrute 8 years ago from Orlando,Florida

      Agreed.This will only be stopped by the people doing "something".Unfortunately,in my humble opinion,the window of freedom and opportunity is closing.If the truth of $30,000.00 being owed in future debts by every American citizen hasn't spawned little more than a whimper of resistance,by a brave handful,we are truly in trouble.