Capitalism or Socialism: Which One Is More Democratic?
What is the difference between free-market capitalism and democratic socialism? And which system is actually more fair and responsive to the needs of the people? Here’s a hint: names can be deceiving. Dinesh D’Souza has the answers.
What makes Socialism so attractive to so many?
it seems more democratic than capitalismit seems more moral than capitalismtheoretically, everyone gets a seat at the table and a slice of the pieall of the aboveWhat is the fundamental problem with Democratic Socialism?
the assumption that no one should deserve free entitlementsthe assumption that some people should be more equal than othersthe assumption that in a free market system, the economy is not under the control of the peoplethe assumption that direct control over government institutions isn’t possibleUnder Democratic Socialism, a majority seizes the fruits of your labor.
TrueFalseCitizens vote in a representative democracy, consumers vote ________________.
by averaging resourcesin a system of direct democracyin a system controlled by Wall Street greedby minority guidelinesFree markets work through ____________________.
greedevenly distributing resourcesexploitationsatisfying our wants
- Proponents of socialism claim it’s more democratic than capitalism and, thus, morally superior. The opposite is true.
Proponents of socialism claim it is more democratic and therefore more moral than capitalism. Leftist filmmaker Michael Moore puts it this way: “Democratic socialism means everyone has a seat at the table and everybody gets a slice of the pie.”
View sourceThe famed socialist writer Irving Howe described socialism similarly in his 1982 autobiography, “We believe that the democracy…in our political life should also be extended deeply into economic life.”
View sourceNathan Robinson argues in his book Why You Should Be a Socialist that the moral imperative is to place the economy under the control of “the people.” This argument claims that socialism is vindicated through its roots in popular consent. If a majority of people, working through their elected representatives, declares something to be a public entitlement — for example, college or healthcare — then they are justified in extracting resources from those who create wealth to pay for it.
View sourceThis line of arguments fails to understand how both socialism and capitalism actually operate — big government providing relatively few significant avenues for participation and control for “the people,” while the free market involves the dynamic and significant participation of people as consumers.
View source- The fundamental flaw of democratic socialism is the assumption that the economy in a free market is not under the control of the people.
The fundamental problem with democratic socialism is its assumption that in a free-market system, the economy is not under the control of the people. Individuals in a free market economy are not only citizens; we are also consumers. The consumer, like the citizen, is a voter. As voters, citizens vote once every two or four years; as consumers, citizens vote many times a day — with money which costs all the time and effort they put in to earn that money. Only some citizens are eligible to vote at the ballot box, but every consumer votes in the marketplace. When citizens participate in a system of representative democracy, their views are filtered through the politicians who represent them. Consumers, by contrast, vote in a system of direct democracy.
View sourceCapitalism and democracy are inherently linked, both placing the power of the country in the hands of its citizens.
View sourceRather than operating through “greed” or “exploitation,” free markets function by satisfying the wants of others. The most successful entrepreneurs are those who anticipate our wants even before we have them. In this way, capitalism harnesses self-interest to make things or provide services for others.
View source- Capitalism leads to economic democracy. Socialism always leads to the economic dictatorship of the elite.
Capitalism leads to economic democracy, empowering citizens to direct and shape the economy. Socialism inevitably leads to the economic dictatorship of the elite, who makes decisions about what they think citizens want and how much they should pay for it
View sourceBoth capitalism and democracy empower citizens, rather than the governmental elite, to direct the country and thus share an inherent link.
View sourceWATCH: “How Socialism Ruined My Country” – Felipe Moura Brasil
View sourceRelated reading: “Venezuela Reaches the End of the Road to Serfdom” – Kevin Williamson, National Review
View source- In a socialist economy, the government has the ultimate power—the customer is a powerless peasant. In capitalism, the customer is king.
In capitalism, the customer is free to make choices about what they purchase, thus directing and shaping the economy. In socialism, the customer is powerless, under the control of the government.
View sourceLate-stage socialist failures, such as Venezuela, eventually run out of essential items, leaving the citizenry in desperate conditions.
View sourceSocialism’s proponents often try to distinguish “democratic socialism” from socialism, but the results are the same.
View sourceIn socialist societies, self-interest is not eliminated but is instead focused on gaining political power.
View sourceRelated video: “Capitalism vs. Socialism” – Andy Puzder
View source- Supporters of socialism are not only working against their own interest, they’re working against the interest of the less fortunate.
The more capitalism, the less “socialism” you need. In America since 2017, a policy of lower taxes and less government regulation has led to a robust economic expansion.
View sourceUnemployment, notably among minority groups, is at generational lows. Economic expansion gets people off welfare and into work.
View sourceAt the end of 2018, the unemployment rate was at a 40 year low for all workers; the unemployment rate for black workers was 6.8 percent, the lowest rate in 45 years.
View sourceSocialism works against its proponents’ own interest, yet it’s gaining popularity with younger Americans. In a 2015 Gallup poll, a larger percentage of respondents under 30 favored socialism over capitalism.
View sourceRelated reading: “Job Creation: How It Really Works and Why Government Doesn't Understand It (Job Creation USA, Volume 1)” – Andy Puzder
View source- Free enterprise empowers individuals.
Free enterprise is an economic system in which few restrictions are placed on business activities and property ownership, and where there is minimal government involvement in commercial interactions.
View sourceCountries with the most economic freedom earn more than six times the annual earnings of countries with the lowest level of economic freedom.
View sourceRead Arthur Brooks on the significance of free enterprise.
View source- Socialism cannot succeed because it tries to control the billions of complex economic decisions made by millions of people every day.
Socialist governments attempt to control millions of people’s complex economic decisions through regulatory schemes, tax policy, labor regulation, etc.—all of which can only hurt the economy.
View sourceEntrepreneurship leads to increasing private sector knowledge.
View sourceIncreasing knowledge leads to growth and wealth.
View source- Socialism isn’t about free choice, it’s about concentrating power into the hands of government elites—ultimately through force.
Socialism is the concentration of power into the hands of government elites to achieve the following purposes: central planning of the economy and the radical redistribution of wealth.
View sourceSocialists often try to hide their method of enforcing socialism, by using terms like “sharing” or “helping people,” but socialism is ultimately imposed and enforced through government force.
View sourceSocialism inevitably involves growing government, thus shrinking the autonomy of the private citizen.
View sourceRelated video: “How’s Socialism Doing in Venezuela?” – Debbie D’Souza
View source
Why is socialism so popular?
Less than ten years ago you couldn’t refer to “socialism” in a positive way and hope to have a career in American politics.
Socialism was referred to as the “s” word.
Now it is affirmed, either explicitly or implicitly, by just about everyone on the Left.
And, amazingly, given socialism’s record of failure, the socialists seem to be gaining ground.
Why? What makes socialism so attractive to so many?
Socialism, according to its proponents, is more democratic and therefore more moral than capitalism.
Leftist filmmaker Michael Moore explains it for us.
“Democratic socialism means everyone has a seat at the table and everybody gets a slice of the pie.”
The famed socialist writer Irving Howe wrote something similar in his 1982 autobiography, “We believe that the democracy…in our political life should also be extended deeply into economic life.”
The basic idea here is that socialism is vindicated through its roots in popular consent. If a majority of people, working through their elected representatives, declares something to be a public entitlement—say free college or free healthcare—then they are justified in extracting resources from those who create wealth to pay for it.
As Nathan Robinson argues in his book Why You Should Be a Socialist, the moral imperative is to place the economy under the control of “the people.”
Sounds good, at least superficially… until you dig a bit below the surface.
First, what direct control do “the people” really have over any government institution? What control do the British people have over the National Health Service? What control do Americans have over the Department of Motor Vehicles or the U.S. Post Office? The answer of course is none. Given its practical impossibility, genuine popular control over government institutions is a mirage.
Second, what if 51 percent of Americans vote to confiscate the resources of a single person, say Bill Gates? Does that make it right?
Under an authoritarian socialist government, a single dictator seizes the fruits of your labor. Everyone is against that. Under democratic socialism, a majority does. The end result is the same––you’ve been robbed.
The fundamental problem with democratic socialism, however, is its assumption that in a free-market system, the economy is not under the control of the people. This is exactly the opposite of how things work.
Let me explain.
Each of us are not only citizens; we are also consumers. These are overlapping categories: every citizen is a consumer, and every consumer is also a citizen. The consumer, like the citizen, is a voter. As citizens, we vote once every two or four years; as consumers, we vote many times a day.
The citizen votes with a ballot which costs him nothing, except the inconvenience of going to the polls. The consumer votes with his money which costs him a lot—all the time and effort he put in to earn that money.
Only a fraction of citizens are eligible to vote at the ballot box, but every consumer votes in the marketplace—even felons, even children. Illegal aliens cannot vote for political candidates, but they too vote with their money. Moreover, citizens participate in a system of representative democracy -- their views are filtered through the politicians who represent them. Consumers, by contrast, vote in a system of direct democracy.
If you prefer an Audi to a Lexus or the Apple iPhone to the Samsung Galaxy, you don’t have to elect some other guy to exercise these preferences; you do it directly yourself, by paying for them. Here we see the secret of how those billionaires like Jeff Bezos got so rich. We made them rich! The inequality that socialists complain about is the result of popular mandate. Want fewer billionaires? Stop buying their stuff!
Free markets work not through “greed” or “exploitation” but by satisfying our wants, and the most successful entrepreneurs are those who anticipate our wants even before we have them. No one wrote Steve Jobs asking him to make a phone that took pictures, allowed people to text messages, and listen to music. He conceived it and built it before we knew we couldn’t live without it.
Market economies involve a level of popular participation and democratic consent that politics can only envy. We don’t need to extend democracy from the political to the economic sphere; we already have it.
And the moral grounding of free markets, just like that of our political system, is in the will of the people—in the latter case, a will expressed only on Election Day; in the former case, a will expressed deliberately, emphatically, constantly.
We don’t need socialism.
Because we already have something more moral and more democratic.
It’s called capitalism.
I’m Dinesh D’Souza for Prager University.
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