The Path Forward: Neither Socialism nor Capitalism
Yes, it is true that Capitalism has been the most efficient wealth-producing economic system in human history. Billions of people have been lifted out of poverty in large part to the global Capitalist system, and most of our innovation in recent history is thanks to the Capitalist incentive model.
Also yes, Capitalism creates massive inequality between the rich and the poor, and after enough time, will always create an ultra-wealthy elite that exists above the law and government.
This is a problem, and some say Socialism is the solution.
Yes, Socialism with its wealth redistribution and increased government involvement can help reduce the gap between the rich and poor. Socialism is also effective at providing a social safety net for the poorest and most vulnerable members of society.
Also yes, Socialism is inefficient at creating wealth and leads to economic stagnation after enough time. It’s also concerning to look at the track record of Socialist governments that become authoritarians who disregard human rights and freedoms.
So if both Capitalism and Socialism aren’t the paths forward, then where do we go?
The solution is not the model we use, but the people acting within the model.
Socialism and Capitalism both suffer from the same fatal flaw- when the people with power lack virtue and neglect the common good, prosperity turns to ashes, and suffering becomes widespread. In the final analysis, the answer to the problem of government is not politics or economics, but rests in the individual character and virtue of human beings.
Powerful Capitalists can use their wealth to lobby the government, or bribe politicians. They can buy off public officials and take advantage of their employees. Capitalists can continue to hoard wealth and reinvest their profits for further gains while taking from the poor and giving none of their wealth in return.
Powerful Socialists can use their power to enrich themselves while neglecting the public. The people put their faith in leaders to provide for them and look after their wellbeing, only to find that power corrupts and their beloved leaders have ignored their oath of office. When the power is put in the hands of a few, the many rely on the few to use their power responsibly. Socialist leaders and the workers of their administration are the same as you and me — susceptible to laziness, bad days, lack of motivation, and occasional incompetence.
On the other hand, Socialists can withstand the temptation of corruption and use their power for the prosperity of the people. They can direct all their energy towards the common good and lead and administration of employees who do the same. In this situation, government funds are used efficiently, officials avoid corruption, and real solutions are implemented to increase the livelihood of the common citizen.
In the same vein, Capitalists can produce the same prosperity for the people. Prior to the introduction of the Income Tax in the United States, most public libraries, museums, and schools were funded and maintained by the wealthy elite. Those with power and wealth recognized their responsibility to give back to their community and actively work towards human flourishing. Capitalists can donate their wealth to charities and community organizations, they can pay their employees fairly, and can use their wealth to benefit humanity rather than themselves.
Ultimately, the good and bad directions of both Capitalism and Socialism rely on the character and virtue of human beings. It is impossible to create a system independent of humanity’s flaws since these systems will be composed of human beings. Instead of debating Socialism vs Capitalism, let’s focus our discussion on the importance of character and virtue of a nation’s leaders and citizens.
