1. Summary
An Economy can be seen as the production and exchange of
goods and services that are to be consumed by people, limited by natural
parameters like geography, natural resources and ecology to name a few. As long
as there is a creation and exchange of goods or services, no matter how
primitive, it is still considered an economy. Hence, economies have existed
since ancient times, and have progressed alongside human civilization.
Capitalism is one
of the better known economic systems, consisting of privately controlled
capital, labor and goods which were traded in various markets. With its birth
in 16th century Europe, it has evolved into the driving force behind
a country’s industrialization. The market were Capitalism is able to function
in is controlled by supply and demand and thus competition for goods and
services.
Some people feel that Capitalism creates a divide in society
between the rich and the poor, as resources are not allocated equally.
According to Ravi Batra, as this worsens and the gap becomes ever larger, the
market will be subjected to financial crisis and economic depressions, which
will cause it to self-destruct, leading to the rise of a new social order. Another
case against Capitalism is that it destroys the Earth. Capitalism drives
continuous economic growth, and continuous growth means ever increasing
consumption of goods and services. This consumption depletes Earth’s resources.
These criticisms are countered by the fact that even though resources are being
depleted, economic growth leads to improved standards of living. One has to
tread carefully in this area, as the ones with improved standards of living are
usually the richer ones that support capitalism in the first place.
Socialism was
created as a response to capitalism, and seeks to eliminate the divide between
the rich producers and the poor consumers. The government controls the flow of
goods and services exchanged between producers and consumers, and dictates how
and what types of goods and services should be created. Although this seems
like a better answer for a fair economic system, it eliminates the driving
force behind growth and development; Profits.
2. Something of interest to me
I feel that in present society, there will always be a need
for Capitalism; there will always be people who was to strive to be bigger,
better, richer, and they will seek rewards that distinguishes themselves from
the rest. This is the fuel for global development. However, I do stress that
this is present society, and it is a
society forged over a very long period of time. This society grooms and
encourages success measure by wealth and power. The divide between the rich and
the poor will not be solved by mitigating the pursuit of and rewards of
success. There needs to be a redefinition of success for this social balance to
occur. Success, in the future, will have to be defined by collective progress where
everyone reaps the benefits. More importantly, those benefits have to fulfill
the needs and wants of people.
3. Discussion point
In my point of view, I do not think that the social balance
I mentioned above will ever be attainable, as it goes against one of the very
forces that drive the idea of “survival of the fittest”. Does anyone think that
a world where everyone is satisfied is even possible?
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