- James Whitehead
- Stoke
- United Kingdom
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Is Capitalism compatible with Democracy?
Is the Capitalist economic system really compatible with democracy?
Or do the contradictions within capitalism itself (eg, low wages to increase profitability, yet high earners needed to buy products) create a system in which democracy cannot function successfully?
Could it be argued that a democratic system would function better in a Socialist economy?
Obey No1kinobe 50+
Capitalism seems to motivate innovation and effort fairly well.
Suggest the issues are when it is left to its own devices.
Most political systems aim to balance competing interests.
A decent democracy or government/political system takes the hard edges off capitalism.
Health and safety laws
Tax collection to redistribute some wealth
Financial regulation
Environmental regulation
Royalties if
Company law etc
As we have many times, unregulated or poorly regulated capitalist/financial systems end up badly for most.
Effective political systems and governments also support business in meaningful ways:
Education
Trade agreements
IP protection
Some democracies do this better than others.
Compatible may not be the right word, but an effective democratic system can be pretty good leveraging capitalism to the benefit as many people as possible.
Agree with most of the comments that communism or as close as we got in USSR and China was a failure on a national scale.
Kevin Brian Carroll
Regardless of all that, what we call Capitalism is an elite government welfare system, where the moneyed and powerful siphon money and power from societies through the government bureaucracies that they built. Most of their theft is bureaucratic in nature, and is the result of managing the way that laws and regulations are specifically implemented and specifically enforced (or not enforced, as the case may be). The Executive Branch is where these manipulations occur, and deep within the bowels of each agency that is tasked with monitoring and ensuring compliance of regulatory law.
In fact, it's not that small business is regulated to death, it's that big business owns the regulatory enforcement mechanism to the detriment of emerging business competitors. Do an org chart of the CIA sometime, and it'll amaze you how often Wall St. brokerage firms are the training ground for that agency' most powerful and entrenched bureaucrats. Those seasoned pros tasked with interpreting general policies as specific and targeted action items.
In each state and federal agency, the same can be seen when doing org charts. Layers of capitalism's most stable successes firmly planted within agencies that are tasked with determining the regulatory compliance of their very own industries of origin, and directing investigations where companies within those industries have been in violation of those regs.
We don't have capitalism, so who knows if democracy clashes with it.
Random Chance 30+
James Whitehead
E G 10+
Just notice historically : the most tyrannies was established with the help of the people ; for example : the Bolshevik Revolution 1917, The Thirty Tyrants ..... .
James Whitehead
I guess in an ideal world, once the system has been established and the frameworks are in place to maintain it, the ideal leader would step down from power, although it could be argued that the type of person needed to lead a revolution is also not the type of person to give up power!
E G 10+
We have to solve the problems we have :human greed and corruption ; how ? I don't have an fully answer but I think the best way is : a restricted capitalism in a democratic system .
E G 10+
"Is the Capitalist economic system really compatible with democracy?" Depends on what kind of capitalism are you talking about . For example if we talk about a restricted by the government kind of capitalism I think the answer is yes.
Uday Pasricha 100+
The difference explains the reason. An individual cannot hold up societal needs because of individual rights. That is blasphemous to us but we have the results.
Orlando Hawkins 20+
David Hamilton 50+
We are all, individual people, after all.
Krisztián Pintér 200+
anyway. no, it is not. the essence of capitalism is private ownership, and freedom in how do you use your property. everything has one or at most a limited number of owners, and other people don't have a say in how they use it. it is essentially antidemocratic. democracy, on the other hand, assumes that some things are decided publicly, by many people who does not own the commanded resources.
there need to be a clear line in society what things are controlled by capitalism and what things are decided democratically. everything falls into one of these areas, but not both.
one more note. that "contradiction" is nonexistent. it is a shortsighted fallacy of keynesian economics. other economic theories, like the suppy-side or austrian economics deny the notion that "aggregate demand" would be a meaningful factor.
socialism in theory is compatible with democracy. but we need to point out that never ever in human history socialism was established by majority vote. and also that they were quick to eliminate democracy as soon as they had a chance.
James Whitehead
"one more note. that "contradiction" is nonexistent. it is a shortsighted fallacy of keynesian economics. other economic theories, like the suppy-side or austrian economics deny the notion that "aggregate demand" would be a meaningful factor."
Never heard Marx being described as a "shortsighted fallacy"... lol. perhaps it is a fallacy if we consider that most of the 'low wage earners' are in the developing countries whose manufacturing process is run/exploited by Western capitalists, and they "drip" some of the benefits down to their own societies, therefore not provoking recognition of the imbalance.
I have no idea if this topic has come up before, I am a new member here and couldn't find the debate through searching....... apologies if i have repeated any issues already discussed.... although no two debates can ever be the same ;-)
Krisztián Pintér 200+
James Whitehead
Krisztián Pintér 200+
the labor market works just like any other market. in a free market economy, producers of a product compete with each other. they try to offer better and cheaper products to outsell the competition. buyers also compete with each other. whoever needs the product more offers higher price, and gets it before other buyers do. this race condition sets the prices so the supply and the demand is in balance. when this happens, the market is called "cleared". there are no excess products, and there is no unserved demand.
the labor market works similarly. employers compete for workers. workers compete for jobs. the price of labor (that is, the wage) rises or falls until the market is cleared. if the price is too low, new demand will appear in the form of new companies wanting cheap labor. but the amount of labor can not increase, since the number of people is limited. there will be a shortage of workforce. the market solution is rising price, which reduces the demand, and clears the market. the opposite is possible too, if the wages are too high, demand will fall, and there will be unemployment.
marx has been refuted in the beginning of the 1900's by austrian economists. mises, in 1920, wrote his essay "economic calculation in the socialist commonwealth", and it should be considered the final nail in the coffin of marxism.
keynes were similarly refuted, the most notable example is henry hazlitt's "the failure of the new economics".
James Whitehead
And if you think the 1920s was the "end" of Marxism..... its worse than i thought
Krisztián Pintér 200+
also note that i didn't give definitions to the labor market, i explained how it works, as opposed to what marx claimed. that's the refutation you asked for. marx claimed that wages will be as low as possible, just to replenish the worker's physical powers to continue working, in accordance with the interest of the capitalist. but in reality wages are rising as the marginal productivity of a worker is rising (by increasing the demand for labor).
the ludicrous claim that i copied anything from anywhere does not deserve a reply.
and also note that i didn't say marxism would be dead. i said it has been refuted. marxism is not at all dead, and it is quite virulent even today despite being refuted. same for keynesian economics. the refutation is out there for half a century, but it is still everywhere, and is the basis of government policies all over the world.