What's the diff. between a capitalist and a socialist?

Question

What is a capitalist and a socialist(what are they against and what do they support) and what are the pros and cons of each?

Not for homework, just curious. Sorry dumb question...

Answer 1

As I always say, the only dumb question is one you already know the answer to, but ask anyway!

Capitalism and socialism are economic systems.

Pure capitalism means that you want private companies (not government) to handle all business. For example, in pure capitalism, the post office would not be run by the government, there might be a private company that would run the same type of business, but it wouldn't be the government running it. The US is considered capitalist, but not "pure" capitalism, because the government owns some businesses, and also regulates business. The pros of this are that ideally, competition would regulate the market, because consumers would buy goods/services from the company that made the best product or provided the best service, and there would be competition to keep prices reasonable. We can see the problems with this system in the US today, just as an example, Microsoft pretty much has a monopoly (meaning they are the only real company that provides goods/services) on desktop computer operating systems. Even if their product isn't the best one, almost all computers you buy come with their os (Windows) and almost all programs are written to be run on their os, etc. They can also charge pretty much whatever they want to for their product, as we can see with the price of their newest os, Vista. You can see another problem with the oil companies. We pay a very high price for gasoline, but oil companies have been making record profits. The purpose of a company is to make money, not to make a good product or service, or to be fair to its workers, it exists solely to make a profit. When the economy of a country is run by companies, then money becomes the most important thing.

Socialism is simply capitalism, but with more government involvement in the economy. In my example above, the post office in the US would be an example of something socialistic in an otherwise mostly capitalistic society. There are more regulations put on companies, and more things are run by the government. The school system in the US is another example of socialism at work in a capitalistic country. Taxes need to be higher in a socialistic society, but those taxes go to providing goods/services that you would pay a private company for under pure capitalism. The benefits of socialism are that things that people need are provided to them, and paid for through taxes. The cons are higher taxes, and less competition.

A current issue in the US is healthcare. Some people say that it would be best for the US to have a socialized healthcare system, because then everyone would have access to adequate healthcare, and people would be healthier in general, because they would have preventative care, not just go to the emergency room when something is really wrong with them. Others say that a socialized healthcare system would be bad because the quality of care would decrease, and that there would be a long wait to see doctors, etc.

I must admit that I think a more socialistic society would be better in the US. Capitalism is good, but balancing it with more socialism would be better. The extreme end of socialism is communism, where all business is run by the government. Most people would agree that such a system will never work. In my opinion, the best system is a capitalistic one that is slightly more socialistic than what is currently present in the US.

Disclaimer: I am by no means an expert, so I may have said some things that aren't quite correct, and of course I my opinion might have biased some things that I said.

I've listed some places to read more about capitalism and socialism in the sources. Economic systems are an interesting topic!

Answer 2

The theory of capitalism is based on the idea of a free market where government interference in business is minimal. Under capitalism, people who take risks and provide goods or services that people want are rewarded for their efforts because they make more money. Under the Socialist system, the government controls virtually every aspect of development, production, and distribution, as well as the wages earned by all workers. This was the system used in the former Soviet Union. Their economy collapsed in the '80's because there was no incentive to work harder, find better ways to do things, or come up with new ideas. You got paid the same wage as the guy or girl working next to you no matter how hard you worked or how well you did your job, so no one worked harder or did better than the laziest person in the shop. So the main difference is the capitalist system ideally rewards people for their new ideas and efforts, whereas the socialist system mandates how wealth is distributed. One works pretty darned well, the other is a proven disaster.

Answer 3

Capitalism is the economic system based on private or corporate ownership of, production and distribution of goods. Capitalists favor a system of free enterprise which means the government should not interfere in the economy, that the laws of supply and demand will make sure that the ecnomy runs most efficiently in meeting people's needs. Capitalism is characterized by competition in which there is rivalry in supplying or getting an economic service or good. Sellers compete with other sellers, and buyers with other buyers. The buyers seek the best possible deal in purchasing goods and the sellers look to make the best possible sale allowing them the most profit.

Socialism is an economic theory or idea that states that the government or the state should be in charge of economic planning, production and distribution of goods. This contrasts with capitalism where free markets predonimate and property is privately owned. Socielism tends to favor cooperation whereas capitalism is characterized by competition.

Answer 4

No such thing as a dumb question - principally the main philosophical difference according o mark is who own the control over production of a product or service - historically a capitalist was someone who owned the equipment, land. etc... that was key for production of a service product and workers had no control over these item and were subject to abuse. Socialism in theory -has everyone owning everything - no private ownership and so the workers own the process and materials for their own livelihoods

Answer 5

It really depends on one's definitions. Americans typically differ somewhat from the classical definitions, and often the two are portrayed as opposites, which they are not..

Capitalism believes (in varying degrees) that a free market will take care of most problems of distribution in society. So they would in general oppose price controls, welfare, government regulation of industry, etc. However, Adam Smith, the founder of capitalism (he published a book on it in 1776) recognized that there are certain things society needs that the market cannot provide because, although society needs them, the individual does not feel this need enough to cause him or her to provide for them. Examples from Smith's time would be education and roads. Today, we might (or might not) include health care, carbon caps, etc. Smith also recognized the need to break up monopolies in order to preserve the health of the market.

Socialism believes (in varying degrees) that the government has an obligation to provide certain things for society. There's a wide range of socilaism, from Soviet socialism (which says the government should provide everything, even how you think) to national socialism (Nazi) which economically looked to have government policies run by business. (It also had certain non-economic policies that were abhorrent, but I mention them because they claimed to be a form of socialism.)

Most socialism today is some form of democratic socialism, which believes that the poor must be taken care of, that education, health care, and retirement should all be provided for, and that people should participate in this process.

Notice that there is a great deal of overlap between the two philosophies. Only in their extreme forms (radical free markets vs. totalitarian control) are they opposites. In common practice, what they differ in is degree: how much should government control/provide? And that is a healthy debate for society to have.

Answer 6

Capitalism: an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market.
NOT is the hands of the Governement

Socialism: any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods.
IN the hands of the Governement.

Answer 7

I live in China so I don't know anymore.