Capitalism

Capitalism is based on the Darwenian concept of survival of

the fittest. While I am aware of no nation that practices a
pure form of this economic system, several Western
countries use a form of capitalism at the core of their
economies. Scaled-down examples of capitalism are flea
markets, bazzars and black market trading.

Properties of Capitalism

• Social/cultural rules and political laws define the

environment.
• Supply and demand provide environmental pressures.
• Those that best "fit" that environment survive and
maintain the rules/laws.
• Those that can't/don't thrive in the system, and
otherwise lack participation, are culled.
• Successful capitalistic systems tend to be open and
competitive.
• A healthy capitalistic system results in economic
incentives.

Advantages of Capitalism

• Capitalism is an internally stable economic system, in

that it is consistent with human behavior. People
understand that life is not fair - there's no "free lunch".
You have to work to survive, and only the lucky who
manage to thrive within the socio-economic matrix
make it to the top. As long as there is a belief/hope that
one can advance in the system, there is an incentive to
participate.
• Capitalism is also externally stable, in that survival in a
capitalistic system requires innovation and flexibilty to
keep up with the changes in supply and demand. Such
a system is generally prepared to deal with the influx of
competition from external sources.
• Large populations are likely to be diverse, which is
beneficial to healthy capitalistic systems.
 • Large, diversified societies tend to gravitate towards
heirarchical social systems; capitalism easily adapts to
such structures.

Disadvantages of Capitalism

• It is not acceptable in most modern societies to allow

portions of their population to be "culled".
• Those in power tend to construct rules that limit
diversity and competition, thereby weakening the
flexibility and strength of the system as a whole.
• Vast imbalances in opportunity encourages revolt,
which disrupts and destablizes the system.

Remedies for Capitalism

• Create secondary social mechanisms to support those

that do not "fit" in the socio-economic system.
• Encourage the inclusion of all members of the
population to compete, and open up competition to
external markets, in order to maximize diversity and
flexibility.
• Educate the elite to the systemic benefits of resource
distribution, and encourage incentives for such
distribution.

Communism
Communism is based on the concept of shared effort and
shared resources. No existent nation practices pure
communism, and I know of no self-sustaining country that
uses communism as a basis for their economy. Successful,
scaled-down examples of communism include early Christian
congregations, kibbutzes and cooperatives.

Properties of Communism

• All members of the economy share both work and

benefits.
• Those that do not provide their share of effort and
resources to the system are culled.
• Successful communistic systems tend to be small and
homogeneous.
• A healthy communistic system results in a cooperative
society.

Advantages of Communism

• Communism is an internally stable economic system, in

that those that participate benefit and those that don't
are culled - creating an incentive to participate.
• Communism requires common goals and agreed upon
rules/laws to allocate responsibilities and resources. If
successful, this leads to a spirit of sharing - which builds
stronger social communities, creating a stabler
economy.
• Due to their sense of cooperation, healthy communistic
systems are very efficient at distributing resources
within their localized areas - particularly in times of
need.

Disadvantages of Communism

• Large or geographically broad populations tend to be

diverse, making it difficult to maintain a common goal
or set of rules for shared effort and resources.
 • Large, diversified societies tend to gravitate towards
systems of heirarchy, reducing the perception of fair
distribution of work and resources - which can
destablize a communistic society.
• Allowing an influx external culture increases the
likelyhood of destablizing the homogeneity of the
society. As such, communistic systems tend to block
out external cultures and exclude outside competition,
weakening the system's ability to learn from, or
compete with, external economies.

Remedies for Communism

• Keep the society small and homogeneous, and

minimize hierarchies.
• Block out external cultural influences and control
external trade.

Socialism
Socialism is based on the concept of everyone gets their
share. This economic system exists in those environments
where resources are plentiful, or populations are extremely
small (such as family units).

Properties of Socialism

• All members of the economy share benefits, regardless

of their economic value to the system.
• Succesful socialistic systems depend on sufficient
resources for the entire population.
• A healthy socialistic system results in non-economic
productivity.

Advantages of Socialism

• In environments with plentiful resources, socialism

provides all members with their survival needs, creating
a stable social environment.
 • Members that cannot participate economically - due to
disabilities, age, or periods of poor health - can still
impart wisdom, emotional support and continuity of
experience to the system.
• Freemdom from work provides opportunity for some
societal members to explore non-economically-
productive pursuits, such as pure science, math and
non-popular arts.

Disadvantages of Socialism

• Since there is no culling and no economic advantage to

working harder, socialistic systems provide no inherent
incentive to participate. This makes socialism internally
unstable.
• Due to a lack of incentives, socialistic systems tend not
to be competitive, making them externally unstable.
• In times of plenty, immigrants are drawn to the free
resources offered by socialistic systems, while
potentially adding nothing economically productive.
• In times of scarcity, resentment of non-economically-
productive members of society increases, causing a
destabilizing effect on the society and economy.

Remedies for Socialism

• Avoid scarcity of resources.

• Keep out immigrants.

Comparisons: Capitalism vs Communism vs Socialism

In an isolated world of plenty, socialism provides everyone
with what they want and encourages creative exploration.

However, since external forces and internal disasters exist,

socialism is unsuitable as the principal basis for a long-term
economy.

In an isolated, homogeneous society with a common goal

and belief system, communism provides all participants with
a fair share of the workload and resources. This works well
for small communities, particularly for non-diversified
societies.

However, it is becoming increasingly difficult in this shrinking

world to maintain cultural isolation; diversity makes
communism unsuitable as a core economy for most modern
nations.

For all it's woes regarding class discrepancies, and the

tendency of the elite to constrain opportunities to
themselves, capitalism is the most inherently stable
economic system - it benefits from diversity and external
competition. A healthy capitalistic economy also provides
built-in incentives to it's members to increase their economic
participation in the system.

However, to maintain its health, the power elite of a

capitalistic society must encourage certain societal
behaviors/rules/laws:

• Diversity of cultures and methods.

• Open competition and free trade.
• In times of plenty: support for non-economically-
productive creativity.
• In times of need: distribution of resources.

The above system describes an economy based principally

on capitalism, but with added aspects of socialism when
resources are plentiful, and aspects of communism when the
need arises.

Summary
Capitalism is the most appropriate economic foundation for a
large, diverse nation. This must be accompanied by open
competition and diversity - which I believe depends on
freedom of expression, free access to information, and
education. Capitalism can be supplemented on local basis by
the communistic support of families and
cultural/social/religious organizations. This increases
preparedness for times of need, while encouraging the
diversity of local cultures. In times of plenty, capitalism
should be tempered by socialistic mechanisms that aid the
needy and support the arts.