February 28, 2013

Interventionism


           Both political parties widely mischaracterize the foundations of the two economic systems of capitalism and socialism.  In the our modern society the average citizen who is pro capitalism would say that they haven’t seen pure capitalism for multiple decades, but in all reality we haven’t had pure capitalism or capitalism without any government intervention ever.  When capitalism was at its founding roots with little to no force included we find that there were major consequences for many people and large chunks of the society do to the lack of protective property rights.  For this reason the majority of America supported regulated capitalism where force (government) enforced protected property rights and embraced the lack of predation on society in order to have the nation prosper. 
            Unlike the interventionist type of government we have now, in the 1800s the force for the most part stayed out of the economy.  For this reason, many of the tycoons we know about today made a fortune by monopolizing a corner of the economy or running cartels.  On the flip side, this unregulated capitalism also led to unintended consequences whether it be bubbles, financial issues or destitution; we don’t see these issues as frequently in our modern century where force intervenes into the economy.  For many of these reasons we have seen multiple reforms in the government/economy through mainly public pressure that resulted in a regulated free-market economy.  This monumental reform that started in the early to mid 1900’s helped to break up the massive monopolies comprised by the tycoons of the economy who were making fortunes off of over charging the masses or whole society.  The momentum behind the wave of regulatory agencies that grew out of the great depression was from the enactment of the Federal Reserve and income tax that the congress created at the beginning of the century.  Where I think the two parties did come together a little bit on regulated capitalism is in the twentieth century; both parties helped sign legislations that promoted government regulated agencies to oversee common things such as food, business centers, ecosystems and medicine production.  Although capitalism in this country is still based on the foundation of private ownership and fluctuating prices through free markets; our current system is layered with rules and regulations to help alleviate people from abusing the system by protecting property rights and implementing regulations.
            There will always be critics who think the government uses too much force, or intervenes in too many areas of the economy/market; especially when you hear people talk about Obama, I hear some people say that they think he is implementing a system more like socialism rather than capitalism.  But in my opinion wouldn’t you call that regulated capitalism or interventionism, in which I believe we need in our economy in order to have a more efficient country.  Obama’s health care reform is obviously a hot topic that people like to critique, but it’s plain and simple that a plan of this magnitude will have to have more government involvement in order to deliver his vision of nationalized health care for better or for worse.  In my opinion it doesn’t seem too far from what we have experienced in the past decades as far as someone or somebody touching the force to regulate our health care and in this case I believe it is/was the insurance companies.  Furthermore, these companies (insurance corps.) failed to use the force adequately and failed to keep our medical cost down as wells as available so the government had to step in; again I’m not implying that Obama’s new plan is a good idea, just simply that either way force was involved and somebody behind the scenes was using the long arm of the government to regulate healthcare.  Ultimately, when we are dissatisfied as a country with a particular system/issue we partake in public pressure that leads to more government intervention.
            What we have today in our current political system is regulated capitalism or what we like to call interventionism, and anybody who has read up on socialism or understands socialism should see that we are not a socialist nation.  Although, I will agree that continued intervention by the government can, but not always or certainly lead to socialism.  We have to understand that if we were a socialist country then the government would control all the production factors such as industry rights and property rights.  Furthermore, as a society we would earn less income because the force would determine what are nationalized wage would be; I do see minimum wage acting in this way a little bit but the government still doesn’t own all of our factors of production which is very important.  We have to keep in mind that we can’t be a socialist nation yet because many of us work in the private business sector, even though there are some people who do work for the government but not all!  To expand on our incomes or wages, the government doesn’t set them; we set our wages by our ability to display our skills and how we can convince a company to pay us more for our services not the government.   Keep in mind we don’t only convince the business, we also convince the customers because they are two in one.  Concluding, if you have money then you can buy things and the things you buy can and are protected by the government through protected property rights in which helps us prosper, if the government didn’t do this then we wouldn’t prosper and we would be closer to socialism.  This is the fine line between capitalism, interventionism and socialism.
            As you can see the concepts between capitalism and socialism can be unclear and a little difficult to differentiate, for this reason continued battle/arguments between these two social issues will only continue to intensify and be magnified.  The U.S. government continues to borrow money to cover our living cost in order for us to reduce our social cost.  For example the cost of our government programs such as Medicaid, Medicare and Social Security.  The increase in costs for these government programs will only lead to greater pressure on our society to make tough choices; Choices like whether we should/have to pay more than the previous generation just to support the needy, underprivileged and elderly senior citizens thus creating unjust effects on intergenerational groups (intergenerationally unjust) .  If we (government) were to decide not to support these programs then the benefits these groups receive would diminish rapidly.  On one side of the argument we are kind of socialist through our actions to transfer wealth from one group to another; but on the other hand we are very capitalistic by are individualistic behaviors that lead to reduce safety nets for the needy, underprivileged and elderly.  Ultimately, the result of our government regulation and individual actions lead our nation to stand somewhere between true capitalism and pure socialism.  I think right now our country lands somewhere between these two social systems, a system we can identify as interventionism.  But as we grow and the government continues to intervene we could end up much closer to true socialism than we could have ever predicted.  Yet, I believe in order for us to prosper and continue growth in our standard of living government must intervene a little bit to protect our property rights and continue our system of interventionism with precaution to socialism through overuse of force.  By precaution to socialism through overuse of force I mean government intervention can/does have a domino effect so even if the government stopped using force right now we would still see and feel the effects of government policies through force that were implemented days, years, decades and centuries ago.  This effects still leaves us with a regulated form of capitalism or interventionism that can creep closer to socialism.  

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