Summer School Econ PM Julia Murad
Many people have numerous opinions on whether or not capitalism makes us more or less free. Capitalism is an economic and political system in which a country’s trade and industry are controlled by private owners’ profit. Capitalism exists in all countries of the world. Whether or not people agree with capitalism has been a major discrepancy. Under capitalism are two groups. The first group consists of the capitalist class. These are the people who own the means for producing and distributing the goods: land, factories, technology, and transport systems. Although this is a major part of capitalism, it is also a small portion of it. the bigger part of capitalism is the working class. These are the people who must sell their ability to work in return for a wage or salary. The goods and services that are produced by the working class is sold for a profit which is gained by the capitalist class. This happens because the capitalists make more money selling what the working class has produced than what it costs to buy on the labor market. Although this seems like the ideal way to produce and sell goods all over the world, it in fact makes us less free than most people think. The goal of capitalism is for a corporation to provide the cheapest good to consumers; however, in doing this, they can’t be fair to everyone. An individual can gain wealthy through their own innovation and hard work; however it is restrictive to the worker. There are many things that must be done for a company to maintain their profit margins. In order for companies to maintain their profit margins wages and labor are the first thing to be cut. Although wages and labor are to be cut, the workers are still expected to maintain the output for producing these goods. Another down side of capitalism is that corporations try to pay the lowest possible wages to maintain profit margins, not based off the workers’ abilities. Thus, workers are no longer free to choose because money, or lack thereof, has become a restriction. Another problem that capitalism brings is the government should only intervene to break up trusts (monopolies); there should be no regulation otherwise. Corporations are meant to pay workers based off their abilities, not what is sufficient for them. This shows the selfishness that the corporations portray. Corporations become an extension of self; CEOs try to maintain profit margins and money for themselves, and thus they become selfish. They do not pay their workers a fair wage. Another negative affect that the corporations bring to the table is that they do not allow for workers’ rights: unionization, child labor, safe work environments, a fair wage, weekends, and overtime pay. An addition to workers’ rights, environmental concerns has also been of affect. Pollution, dumping waste into rivers, deforestation and extinction of species are all examples of why intervention is necessary. A third problem that capitalism consists of is individualism. The idea that a man can “bring himself up by his bootstraps” is a principle of capitalism; however, in today’s society, this is not the case. There is very little the average man can do to bring himself up. CEO’s passing on companies to their sons/the business world is very much about whom you know. It is difficult to get a foothold in without knowing someone of a higher power. There are little opportunity in regards to educations, the majority of Americans go to public schools, and they are all paid for by property taxes, thus those in lower income neighborhoods are handicapped by a lack of funds for teachers, updated textbooks and smaller class sizes, thus harming individual’s education, and thus making it more difficult to succeed and bring themselves up
Bringing in a second opinion on the matter, Karl Marx added his thoughts about capitalism in the Communist Manifesto written in 1848. Marx believed that capitalism “through industrialization has increased the capability of the world’s economy far beyond that ever witnessed before” Marx further explained that capitalism brought in two competing classes. One of these classes was the bourgeoisie. These people owned and controlled the means of production and hired wage laborers. “capitalisms very nature would ensure that eventually, these classes would struggle against one another to the point where the class of workers would get large enough and oppressed enough that it would overthrow the bourgeoisie, seize the means of production from it and end the economic system known as capitalism.” Marx’s views on capitalism reiterate that capitalism is not the most efficient way to go about work laborers and the amount of work laborers and the amount of money that the workers get paid.