2 Reasons the Capitalism vs Socialism Debate Makes No Sense to Me

Now that Joe Biden has won the election, you’re probably gonna be hearing a lot of talk about socialism descending upon us. This post isn’t about defending socialism or about trashing capitalism. My goal isn’t to say that socialism is good, but that the conversation surrounding it is confusing. So here’s 2 reasons why the capitalism vs. socialism debate makes no sense to me…

  1. No one seems to know what socialism actually is
Confused Guy | Between Two Rocks

If you ask someone who hates socialism to give you an example of it, they’d probably list countries like Soviet Russia, China, and Cuba. But ask someone who likes socialism that same question and they’ll probably list things like Finland, Denmark or Bernie Sanders. Obviously all of these are radically different. So how can they all be the same thing?

Simply put, socialism is defined as an economic system where everything is owned and managed by the government. In its purest form, socialism does not work and has never worked. One notable example is the no-longer existing Soviet Union. While in theory it sounds nice to have everything owned by the government and hope that it would equally redistribute its resources so everyone would be on the same playing field, this doesn’t usually happen. The result is a massive gap between the poor masses and the rich few in government. 

So instead, some countries take some elements of socialism and mix them with capitalism so they can get the best of both worlds. This is what countries like Finland and Denmark do where they have universal healthcare and free education. The problem is that in all of these cases, the same word “socialism” is used. Technically speaking they’re all socialism, but different forms of them. The Soviet Union and Cuba are examples of Marxist-Lenin socialism while Finland and Denmark are examples of “social democracies”

So when capitalists talk about socialism eradicating private property, they’re talking about Marxist-Lenin socialism. When millennials talk about socialism being the answer to the evils of capitalism, they’re talking about a social democracy.

That being said, telling immigrants that Biden will make America like Cuba is irresponsible–because it’s not the same thing. Conversely, telling people that socialism is great because…well, Finland…is ignorant–because that’s not the full picture.

The reason this makes the debate not make sense is this. When pro-socialists use countries like Finland to defend their socialism, they don’t realize that Finland isn’t as socialist as they think. And when capitalists admit that Finland is great, but isn’t actually socialist, they don’t realize that it isn’t actually capitalist either. So at the end of the day the debate ignores the fact that these other countries are still doing something right that we’re not.

2. The U.S. isn’t actually capitalistic

Capitalism vs. Socialism: What's the Difference?

True capitalism is a free-market economy. This means that the government has no say in what businesses can and can’t do. In a purely capitalistic economy, businesses could literally get away with murder and the government couldn’t stop them. In fact, when capitalism first started in the U.S., it was built on child labor. Not only is this as dangerous as pure socialism, but this obviously isn’t what the U.S. has anymore. 

The U.S. isn’t a free-market but a mixed market. What this means is that some parts of our economy are controlled by the people and other parts are controlled by the government. So you can open your own hair salon and charge whatever you want and the government won’t stop you. But you still have to pay your hair dressers minimum wage. You can own a restaurant and charge whatever price you want for a burger. But the FDA will still have some say in what meat you put in that burger. All of this is fundamentally not capitalistic and, in fact, pretty socialist. But the reason it’s okay is because these elements are mixed. On their own they wouldn’t work, but together they do. Well…sort of.

The reason this makes the debate not make sense is that the U.S. isn’t just capitalistic—it’s a mix of capitalism and socialism, the very thing capitalists are against.

At the end of the day, whether you love socialism or hate it, my hope is that from now on you’d have a better idea of what you mean when you say you hate it or love it. 


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