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Capitalism and Socialism

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The last two years have seen a lot of turmoil in the financial sector and the economy in general.  There has been much commentary on how our economic system, especially capitalism, has failed, and we need to move toward socialism so as to be fair to all.  There was even a Newsweek magazine cover that said, “We Are All Socialists Now.”  But has capitalism really failed?
Let’s define capitalism.  My well-worn Winston Dictionary defines it as “an economic system which rests upon private ownership of property, the conduct of business for private profit, and freedom of individual initiative in business; opposite of socialism.”
I’ve read through this definition several times; I can’t find anything I don’t like about it.  Now let’s see the definition of socialism: “the economic doctrine that there should be public ownership and operation of the principal means of production and distribution of wealth, and an equitable apportionment of opportunity and of the rewards of labor…opposite of individualism.”
Here I can find a few problems.  Public ownership and operation of enterprises has not always worked out well.  There is public ownership and operation of the nation’s postal system.  The results are mediocre at best.  I like everyone I know that works for the Postal Service; our local people are great and do a fine job.  The system itself stinks; it eats, misdirects or delays about 5% of all the packages I send; the junk mail sails through without fail.  I’ve never lost a package through UPS or FedEx.
There is public ownership and operation of the nation’s education system.  Here, we can’t afford mediocrity, as a poor education cheats a child for the rest of his or her life and burdens the nation with the cost.  Again, I don’t blame the individuals in the system; it is the system itself that is the problem, along with the baggage that has cluttered education.  Like the bumper sticker says, “If you can read, thank a teacher; if you can’t, thank the teacher’s union.”
Amtrak.  No comment needed.
Another part of the definition of socialism that bothers me: “distribution of wealth.”   I don’t recall anything in the Constitution about taking the fruits of someone’s labor and passing it out as some bureaucrat sees fit.  If you think distribution of wealth is a good idea, you will have a swift conversion if you hit the Powerball, and Uncle Sam takes half.  Even God only asks for ten percent.

“An equitable apportionment of opportunity and of the rewards of labor.”  I don’t know how to equitably distribute opportunity, and neither does the government.  Opportunity is where it knocks.  As for the rewards of labor: is it really fair for the slacker next to you that stops working as soon as the foreman leaves to make the same wage as you when you are putting out your best?  This is what bothers me about today’s unions.  I have worked in several union shops, and have had several shop stewards “advise” me to slow down, as I was making some of the other workers look bad.  My smart-aleck response was always “they don’t need my help to look bad!” 
I don’t know anything that exemplifies freedom any more than being self-employed.  It is exhilarating.  Sure, it is tough starting out each day knowing that dinner depends on doing what you do in the best fashion you can, but it is a powerful feeling to know that you can make it on your own.  Working for yourself takes you out of your comfort zone.  It stretches your character; it gives you a kick in the pants to get the job done right.  It is immeasurably good for you.  I recommend everyone try it, even in a small, part-time way. You will surprise yourself, and you will gain a valuable perspective on how important freedom and liberty are.
However, understand that if you do start your own business, you will be frustrated and discouraged by the endless taxes and regulations that have sprung up in the last few decades.  The following example will help illustrate this.  A few years ago, I was having a discussion (argument) with a representative of the Bureau of Workers’ Compensation.  She told me that I had to pay for worker’s compensation insurance if I paid a kid to cut my grass.  I laughed, thinking she was kidding.  She informed me, in cold bureaucratese, that she was perfectly serious and I must comply with the law.  This is what we have come to.
Capitalism and liberty are flip sides of the same coin.  You can’t really have one without the other.  Reread the definition of capitalism above and you will see the basis of the Constitution in the words.
Back to the original question, “has capitalism failed?”  I say no.  The institutions that have failed were so wrapped up with government and political patrons in Congress that a new term has sprung up to describe the phenomenon: crony capitalism.  It is the tentacles of government regulation spreading into business that is causing them to fail or stagnate, just as the tentacles of government regulation are reaching into our private lives, strangling our liberty.  Capitalism is not perfect, but socialism is not the answer.



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Larry Bertolino

Larry Bertolino

Owner at myLocalPCpro
Larry Bertolino is a 31 year old, U.S Navy Veteran and currently sitting on the board of Directors for the Harrison County Chamber of Commerce, as well as Harrison County Rural Transit.
Larry Bertolino
Larry Bertolino

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Posted by on October 4, 2010, 1:53 pm. Filed under Featured, John Lovejoy, Politics. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry