Strengths and Weaknesses of Communism and Capitalism PDF

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The prompt for this response paper was: what do you consider to be the greatest strength and the greatest weakness of both Communism and Capitalism? Explain why these strengths and weaknesses are important....

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Cristian Cortés POLI 344 Prof. Celeste Beesley Brigham Young University

What do you consider to be the greatest strength and the greatest weakness of both Communism and Capitalism? Explain why these strengths and weaknesses are important.

The differences between capitalism and communism have served as fuel to ignite the fiery debate that has turned entire countries upside down. The same debate that, in the 20th century, was the basis of the Cold War. The question that raises this debate is: which economic system is better, capitalism or socialism/communism? Today, even Russia has adopted capitalist practices, and even the United States talks about the benefits of socialism. In this response paper, I do not intend to answer this question but will present what, in my perspective, are the greatest strengths and weaknesses of each side.

The greatest strength of communism: Its social protests and moral values based on the equality of all mankind. I am completely in favor of the social demands that communism fights for, and I believe that, indeed, there is such thing as a class struggle, which I have sadly been a part of. For example, communism fights against the capitalist idea that each person is free to go as far as he can and that the poor are responsible for their own education in order to change their economic situation. Marx abhors this idea, and I unquestionably share that sentiment. How can a poor person be free to choose his outcome if he does not have the same opportunities and access to education as a rich person?

The greatest weakness of communism: The significant lack of scientific scrutiny and rigor. The manifesto of the communist party, which has been the most publicly important precursor of the communist movement, possesses little or no scientific rigor. The problem is that Marx based an entire economic ideology on things that he claims to have seen and that he says are true, which is not enough. To start a new economic theory, and promote actions and revolutions, it was necessary to present empirical evidence, i.e. data. For example, in the manifesto, he says that the unceasing improvement of machinery, the increase in technology, will leave the proletariat receiving the minimum wage possible, just enough to survive and that eventually, they will destroy bourgeois society. Well, the world has been waiting 170 years for the collapse of capitalism and it has not happened yet. Wages keep going up (although as we have learned in class, they are stagnant compared to productivity growth) and world poverty decreases every year. Until today, there is little or no evidence to support Marx's economic theory.

The greatest strength of capitalism: The accurate criticisms that capitalism makes on the economies controlled by governments. This touches me deeply because I am from Latin America, and I have seen how the economic well-being of a country can be destroyed with the mistaken belief that "the state (government) protects you" or "more state is the solution." In this sense, capitalism wins because there is evidence that intention is not the same as outcome, and a government-controlled economy is inefficient because it is not based on incentives. Venezuela, Cuba, and Argentina are good examples of the inefficiency that capitalism prevents.

The greatest weakness of capitalism: Exploitation and inaccurate accountability of value. This economic system creates instability and social inequality, especially under what Marx described as exploitation, which is the accumulation of surpluses by the rich and zero accumulation for the proletariat, even though labor does give value to the product. According to Stiglitz, the selfbenefit attitude present in capitalism does not generate social value, i.e., market fundamentalism does not benefit society and would collapse if it is not regulated by the government. In other words, the invisible hand, in which capitalism religiously believes, does not exist, and it is the government that makes market fundamentalism work.

The importance of knowing these strengths and weaknesses is that with this we learn that humanity still must seek and create an economic system that rejects the weaknesses of both ends of the spectrum (capitalism and communism) but has its strengths. An economic system that eradicates inequality between society and that is in turn efficient in generating wealth and improving the quality of life of the population. This is when I need to quote Stiglitz, who, in my perspective, presents the most balanced idea of all the authors we read these weeks, and he is the one that I find most convincing. He argues that the most successful countries have been those that have managed to balance the basics of market fundamentalism with active government participation. Stiglitz gives as an example the world's largest economy and model of capitalism: The United States. According to him, and contrary to what the public opinion thinks, the US has carried out a fairly balanced economic program, with significant government participation in sectors such as education, the financial market, technology, and science. According to Stiglitz, the government has been the solution and the reason why capitalism has endured so long....