Western Critical Commentary

“The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries.-Winston Churchill” 

In class we have gone into detailed and deep discussions about various western theories from capitalism, to socialism to feminism. I would like to provide my critical commentary and analysis on capitalism because it is what I have grown to know, to understand, and to identify myself with.

“Under capitalism, man exploits man. Under communism, it's just the opposite.- John Kenneth Galbraith “

      Capitalism as defined by our class discussions and presentations is a condition where all means of production are owned privately therefore allowing the power to make decisions and earn profits solely in the hands of the private owners. Capitalism as seen throughout the world can be both good and bad. Capitalism is seen and associated for the most part to western and to industrially advanced countries. There are many who believe however that all it stands for is evil and that it is the evil that rots society. The saying that ‘the rich get richer while the poor get poorer’ certainly is an accurate description of the prime evil of capitalism but there is more to it than that. Capitalism, is generally agreed by most people, encourages growth rates and that is not in question. The debate that is present to date is the cost and manner in which it is achieved in. In our contemporary times we will not easily see a purely capitalist nature economy being run or accepted by the state. More countries are now adapting laws and policies to regulate capitalism and ushering in a mixed type of economy of both public and private ownership which I strongly agree too. Mixed economies may be the perfect temperament to combine pure capitalistic nature of all things private and communism or socialisms stark contrast of the emphasis of production and ownership being left in the hands of the state.

   

The Good

  The question now begs answering is it good or bad? Let us see the arguments from both side of the coin starting with the good. Capitalism is an efficient method of allocating resources to where they give the highest ROI or return in investments. As an example a company here in the Philippines will not build a power plant if there is no viable returns of their capital and profits to be made, simply put they will not spend. On the other hand if resources and capital are run by the state and the government mandate this project saying they will allocate this amount and this amount only or increase it in perpetuity until it is done, what ever edict the state has decided that is what they will do whether it is worth while or not. So a non-capitalist state has the possibility of seeing all the power and means of production fall into the hands of bureaucrats who may use the money as intended or use it for self gain. This is the main advantage of capitalism, it can prevent this from happening and instead gives the power to the people, the entrepreneurs who are driven by their own personal needs and the needs of the market. This will lead to a chain of events that will allow the entrepreneur to create and enhance production to earn profits, which (though inadvertently) will allow the economy to surge ahead as a whole. This will allow the economy to open up with a greater deal of competition, and this competition will benefit both the competitors and the consumers as it allows for low barriers to entry and perfect competition (ideal scenario). With this set up the members of society are incentivised to work and create their own success and get a slice of the proverbial pie. This decentralized system of operation is good for everyone involved. Consumers are given choices and they are free to do as they please with their hard earned money. The society in general becomes more liberated and standard of living goes up. With all these in mind it seems hard to imagine that capitalism could actually be bad.

 “Capitalism has worked very well. Anyone who wants to move to North Korea is welcome.-Bill Gates”

   The Bad

   Well it can and these are the arguments against capitalism.  They tend to form monopolies and monopolies are bad. Capitalism tends to concentrate their resources towards these institutions and the more efficient tend to drive the less efficient out of the market. SM and PLDT are examples though monopolies in the Philippines are quite abundant. Capitalism also puts labor force at a disadvantage of sorts, especially if there is a surplus in labor and when the cost go high they move somewhere cheaper and leave those labourers jobless. The bigger capitalists such as Multinational companies and Monopolies tend to be the ones who exploit their workers. Another drawback is that when monopolies and large companies have gained foot hold they can prohibit the entry of competition by monopolizing resources and when this happens, the virtues and ideals espoused above are destroyed but sadly this is a real occurrence in the Philippines and also in the world. Another negative that is said by the detractors of capitalism is that a capitalist economy becomes very materialistic and money oriented in nature, and this affects peoples of the country morally and spiritually. To apply this in the Philippines I will say that the effect is not a big explosion and a massive paradigm shift but can be compared to a slow mild poison slowly seeping in. When this happens economic disparities rise, which in turn breeds social out casting and criminality in order to sustain themselves in a consumer society. Overall the society suffers negatively and it is something that we do not need. The biggest draw back is exploitation as people want to earn more and more then more is given up. Natural resources, human resources, and others this leads to severe consequences in the long run. So how can something so evil be good.

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My Take

The answer on whether capitalism is good or bad lies entirely upon the country it is in. No matter where it is in the world there will always be good companies and corporations that seek to improve lives and give quality service and bad corporations that may try to take advantage of the system and abuse laws and resources and then there are those in between who just comply with the existing law. That is the problem in the Philippines there is still a hole when it comes to regulation of capitalism. There are still no Anti-trust laws or other mechanisms that can comprehensively protect against systematic abuse in the name of business and profit. Capitalism has been adapted throughout the world and has taken a new shape a mixed economy (Philippines had this, sort of) where the aim is for a mutually beneficial cooperation between capitalism and socialism. This allows for the opening of the economy whilst providing a shield for the poor from exploitation.

There is no definite answer to whether capitalism is good or bad because it all boils down to where you are and how it is set in place and if the state has ensured safe guards and mechanisms to be in place to stop exploitation. There are advantages and disadvantages to capitalism and to label it good or bad is simply not possible. Be the judge yourself and take a look around.

                                                                                

"Capitalism has its weaknesses. But it is capitalism that ended the stranglehold of the hereditary aristocracies, raised the standard of living for most of the world and enabled the emancipation of women.-Camille Paglia"