Capitalism and Socialism

Can capitalism alone save the world?

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Lately there has been a growing feeling in India that capitalism is the ideal way to solve all our problems. Therefore we now have people giving more importance to stock market fluctuations, profit margins, acquisitions, layoffs and governments of various states clamoring over one another in an effort to woo industrialists. This is all fine but is it really solving the problems of an ordinary citizen like you and me?

Please do not be under an impression that I am a communist. On the contrary I am totally against communism. I however believe in socialism and yes there is a difference between the two. While communism is a political system of governance, socialism is a system pertaining to economics. I am as opposed to complete communism as I am against complete capitalism. I believe communism is great as an idea but difficult to implement as has been proven by the collapse of hard core communist regimes around the world. The successful ones were the ones who adapted it according to times and have diluted the principles of communism in one way or the other.

Capitalism on the other hand is easy to implement and yields quick results and hence its popularity. But that is not to say that it is the ideal solution to the world’s problems. If that was the case then there wouldn’t be poverty in the greatest of all capitalist countries, America. However we all know that this is not the case even after all these years. Take a look at the numbers and you will find that half of America’s wealth is concentrated in the hands of 1% of its population. That’s the main problem with capitalism. Wealth is generated yes, but is concentrated in the hands of a few.

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To really reap the benefits of capitalism it has to be supplemented with good socialist policies. The responsibility for that should lie with the government. While it is well and good that governments encourage new industries to start, they should not forget that the primary function of governance is not just providing assistance to industrialists. Their primary function is to improve the general living standards of the whole of society and not just sections of it. Governments’ efficiency should not be judged by the GDP alone but by ascertaining how much of the living standards has improved across the various sections of the society. The judgment should be more qualitative than quantitative.

Government should ensure that the benefits reaped from industrialization actually reach the lower strata of the society. By that I don’t mean tax the rich more. It should be the government’s duty that industrialization is not localized but spread across the country. Taxing regimes should be more systematic and scientific to ensure that no one escapes the tax burden. Revamp the whole approach of the nationalized institutions and make it more professional and accountable. Also providing more encouragement to neglected industries, like agriculture for instance, should be taken up as a priority.

But more than anything else improve the education standards in the country. By education I do not mean that everyone should be given masters degree. On the contrary by education I mean any skill or knowledge which would give the coming generation to make a difference in this world. India was able to take advantage of the IT revolution not because it was there at the right place at the right time, but because enough of its youngsters had the right education at the right time. To improve education you need to attract better teachers. And to attract better teachers their remuneration too should be appropriate. At the moment it is pathetic to say the least. Do not expect the coming generation to find the way if the ones to guide them itself are half blind.

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It is wrong for capitalists to think that there is no other alternative to capitalism. Capitalism alone will only covet more greed and blind profiteering. There is an alternative where government ensures that at least a portion of the pie is given back to the same society from which it was made. Capitalism alone hasn’t made the world better, why not try this?