Capitalism Or Socialism?


Liberalism puts forward the idea that we must choose between two extremes, if you don’t support free speech then you support all speech being controlled. If you don’t support free trade then you don’t believe in trade. The choice between Capitalism and Socialism is one of those extreme positions, because like most people I actually think that a good economy has a bit of both, but not too much of either.

But to understand this better we must define what is meant by Capitalism and Socialism, because one thing that allows Liberalism to continue this absurd idea is that the terms are not defined. People are left to argue without any agreement about what they are arguing about.

Strictly speaking Capitalism only means collecting money (capital) for investment. That is what Capitalists do, they collect money so that they can use that money to invest. However many people also use the word Capitalism to mean the ownership of private property or the ability to make money from your own labour or endeavours.

The rise of Communism in the 20th century encouraged this idea as they were against all of these things. But Socialism and Communism, while related, are not the same thing. Both say that the economy should be controlled by the government, but the degree to which government should control the economy differs greatly. For Socialists the degree is astonishing, some are very light and others go all the way to Communism. For the ‘light’ it might mean that extreme poverty is the enemy, so no one should go hungry or be homeless. For others it might mean that the government makes decisions on how the economy is run. Others don’t like excess and rich people offend their sensibilities. But most Socialists believe that Socialism can exist in nearly any political system. Communists do not believe that, they believe that anything less than a Communist government is just not good enough.

When I write about Capitalism I mean the strict version and about Socialism the ‘light’ version.

The problem with big business is that it seeks to be richer and more powerful, which means that it destroys competition. Which it claims to love, but doesn’t. Instead it seeks a big slice of the pie, whether that pie is bigger, small or stable in size. That includes in power, it sucks power away from other areas, just as it does the same to finance. Unless some limit is placed upon big business it will destroy the economy, including itself.

Certainly there are some companies that do need to be big, just as some industries should be controlled by the Government, but they should be exceptions.

But to give that power to the Government is also destructive, of course the Government needs power. But everything needs limits, everything needs to be kept under watch and nothing should be allowed to get out of control. An economy that allows small and medium companies to predominate is an economy that serves the most people and at the same time allows people to make the decisions about that economy.

Originally published at Upon Hope.