The fundamental principles and arguments of the supporters of socialism and capitalism as opposing systems were established in the period of the 19th century and the practical implication of the 20th century led to the adaptation and further solidification of their respective argumentative basis. Capitalism is an economic system, which is based on the idea of private property and the market distribution of goods and factors of production.
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It emphasizes the rationality and efficiency of the process of capitalist development. The main bias and fallacy of the author is the fact that he states most capitalist nations have almost no absolute poverty, which is not necessarily true due to the presence of mass homelessness in countries, such as US (Caplan). Through the mechanism of competition, the private interests of individual economic entities spontaneously fall into line with public interests, which allows to systematically improve the standard of living of the population in the long term.
The rhetorical argument is effective because another claim is the statement about fair distribution based on the market mechanism, since the generated income of the entities is proportional to their productive contribution. The author uses mainly logos as a rhetorical appeal, but ethos and pathos are also present. It is important to understand that capitalism promotes free market, which allow people to improve themselves (Caplan). Theoretical or real-life socialism, that is, absolute equality, is stated to be economically inefficient and irrational, since it diminishes the moral and institutional foundations of society through dictatorship. Moreover, this contradicts not only economic, but also political freedom.
The prevalent interpretations of socialism and capitalism as systems of economy have certain similarities such as wage labor, the expanded division of labor, problems of finding stable regimes or forms of capital, the accumulation and distribution of income, and the regulation of the activities of institutional economic entities. Majority of capitalist nations are proponents of freedom and human rights, whereas the latter usually deprives citizens from their fundamental needs (Caplan).
In general terms, national systems of economy are complicated states of numerous interconnected entities – some of which are newly created, while others have evolved. In a dynamic perspective, they, on the one hand, should have consistency and stability, and on the other, flexibility and adaptability. In addition, most capitalist nations are indeed richer and more developed than their socialist counterparts (Caplan). The historical experience of national systems has shown the existence of contrasting models of each system. While some of the positive features of the preferred system intensified during certain periods and in individual countries, its existing weaknesses also became apparent.
Moreover, the reasons presented by the author fall under the *STAR acronym. The situation is manifested in the fact that these systems are reviewed as ideal economies for both cases. The task is to identify the reasons why socialism fails to be viable compared to capitalism as an economic system. The actions undertaken by the author is to compare the ideals versions and their manifestations in the real countries. The overall results are that modern form capitalism does not fully match the ideal capitalism, but these nations are still outperforming socialist counterparts.
The arguments given to the audience are correct and plausible due to the fact that it uses straight forward examples and common-sense knowledge. Supporters of socialism adhere to the notion that it is defined as an economic system manifested on organized regulation of the economic processes and public ownership. It also uses similar basic economic tools, but with opposing derivatives about economic realities. This system considered capitalism as an unequal system and it is a result of free markets. The ideal existing socialism, is considered to be a model that allows conscious organized development, which eliminates capitalist flaws, like crises and social conflicts. It is such a model that promotes its own progress and a high degree of freedom, which in practice almost always had the opposite character.
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Evidently, existing economic systems are structurally contrasting, but capitalism can offer more flexibility and adjustability to its proponents. The differences between the historical realities of favored systems are far from the ideal model, which is considered the direction of further development. The arguments given by the author are a comparative analysis based on the proclaimed values and objectives, such as efficiency, rationality, justice, freedom and modernization.
However, in general, they provide regulatory standards for economic modernity. The capitalist model of housekeeping has proven its viability in the long run. Socialism, as an alternative system, proved to be more stable in the short term.
In conclusion, deep transformations, as a rule, are associated with changes in cultural values, social differences, and international relations. Moreover, these transformations occur within a short historical period and differ in their rhythm and pace. The traditional economic theory, based on the analysis of equilibrium, is unable to resolve the causal relationships that have arisen.
There is a need to formulate an approach to explain how the general historical background, the same starting conditions, systemic interdependence, institutional reform and similar policies can lead to different country results. The transformation of economies, the testing of diverse development models is, of course, a multifaceted and controversial historical process. However, the arguments given throughout the article give a clear picture of capitalism being more reliable and suitable for prosperity of the nations and its population.
Caplan, Bryan. “Capitalism vs. Socialism: The Bruenig-Caplan Debate.” EconLog, 2018. Web.