“Socialism states that you owe me something simply because I exist. Capitalism, by contrast, results in a sort of reality-forced altruism: I may not want to help you, I may dislike you, but if I don’t give you a product or service you want, I will starve. Voluntary exchange is more moral than forced redistribution.”
~ Ben Shapiro
Whenever someone speaks about capitalism in a caustic manner, people conjure negative images of evil men in suits who want to oppress the poor. They are of the opinion that a socialist system should be imposed upon everyone in order to have equitable distribution of wealth. However, nothing could be further than the truth. Socialism, which is a direct of consequence of communism, has had a detrimental effect on people’s lives and damaged the economy of a country e.g. Cuba, Venezuela.
How is Capitalism beneficial to the society and the country in general?
Let’s look at a meaningful English conversation on the same that touches several important points:
Jordan: Hi Medhavi!
Medhavi: Hey Jordan!
Jordan: Recently, I was pondering over why there is so much greed and inequality in this world. Is it because the world is ruled by capitalists and wealth creation is the sole motive in life?
Medhavi: Well, no. That is an inaccurate opinion peddled by so-called activists who claim to be fighting for the poor. Socialist systems have never worked well for countries. In fact, capitalism has benefited the masses more than anything else.
Jordan: Interesting. But how? In capitalism, there is no even flow of economic resources. If only a few people benefit from it, then I guess the entire system is flawed.
Medhavi: Oh no. Maybe your knowledge is limited on this. Would you like to know more?
Jordan: Of course I want to! Go ahead.
Medhavi: Well, capitalism is based on free markets where firms are privately owned and there are some regulations by the government that one has to follow in order to ensure a level-playing field to all. You know all the startups we have in India and around the world?
Jordan: Yes, what of them?
Medhavi: They can operate and sustain themselves only in a capitalistic country. Under socialist economies, have you ever seen any startups or entrepreneurs who can change the world with their brilliant ideas?
Jordan: Now that you mention it, I am unable to.
Medhavi: Yeah, because there aren’t any! In capitalism, the aim is wealth creation while empowering people. Hard work and ingenuity is rewarded while laziness is punished. Compare this with socialism, where you are paid just for existing! Is that fair?
Jordan: No, I guess not.
Medhavi: Also, everyone agrees that a democracy is the best form of government around the world. People decide the government they want. Most of the world’s vibrant democracies like the U.S. and India, as well as the European powerhouses like Germany, U.K., and France are capitalistic in nature and thus are the hub of innovation and creativity. To put it simply, capitalism is more compatible with democracy than with any other government system.
Jordan: That’s interesting. But isn’t the sole aim of making money a bit incompatible with social values? Should we not work for the betterment of society?
Medhavi: That’s where capitalism is misunderstood. Everyone working for money or let’s say their individual self is actually great for society. People work in different industries and produce goods and services that will benefit someone. Every job, be it of a sweeper or sanitation worker, or of a lawyer or banker, is engaged in having a positive effect on the society.
Jordan: Good point. What about equality that socialism claims to offer but capitalism doesn’t?
Medhavi: Equality? If you live in a capitalistic society, you can rise from the mud to bloom into a lotus i.e. become a successful person through sheer hard work. Everyone has an opportunity to become big! People can dream of achieving amazing heights of success, which is only possible if they live in a society that rewards them.
Jordan: I agree. But overall, don’t you think socialism has a more altruistic spin to it?
Medhavi: And that’s what it is – a spin. Living in a welfare society means you have a safety net for the poor but at the same time, limits them from exploiting their potential. On the other hand, capitalism exhorts people to become self-sufficient, industrious and instills in them a sense of entrepreneurship.
Jordan: That is a solid point.
Medhavi: Last but not the least, people are also happier in capitalist countries. Any place which is a thriving innovation hub and encourages competition to be the best produces higher quality goods and services and as a result, contributes to a better quality of living for people. They are definitely way happier!