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The pros and cons of socialism and capitalism
Capitalist vs. Socialist Economies: What's The Difference?
Socialism is a political theory. It is also an economic theory. This structure advocates for production, distribution, and other economic exchanges to be owned or regulated as a whole by a community. If employed as a government structure, Socialism would have all businesses owned by the government, have all property owned by the government, and all resources owned by the government. Then the government would distribute those resources throughout the population so that basic needs could be met. Socialism is often confused with Communism, but the two structures are very different.
In the United States, capitalism has always been the prevailing system. It is defined as an economic system where private individuals or businesses, rather than the government, own and control the factors of production: entrepreneurship, capital goods, natural resources and labor. Capitalism's success is dependent on a free market economy, driven by supply and demand. The government, rather than the free market, determines the amount of output, or supply and the pricing levels of these goods and services. But, even at their extremes, both systems have their pros and cons.
Since the global economic crisis started in , people began thinking of ways to bridge the widening wealth gap within and among nations. As capitalism becomes unpopular, talks about renewed interests in socialism start to surface. Socialism can be defined in two ways. First, it is an economic system which centers on common ownership. In this system, the government mandates production and prices. Also, private ownership of property is not allowed.
Reading: The Disadvantages of Socialism
In the early to mid th century, socialism was all the rage. Several countries adopted socialist ideas in some form or the other. Unfortunately, many countries that experimented with socialism failed — Cuba, Cambodia, Chile, Hungary, North Korea, Venezuela, the Soviet Union, and many others — leading to the decline of socialism. Surprisingly, socialism is experiencing a resurgence in the 21 st century, in part due to the growing economic disparity and due to the influence of socialist politicians like Jeremy Corbyn in the UK and Bernie Sanders in the United States. According to a poll by Gallup , majority of you people today have a positive view towards socialism.