One of the Stories About Capitalism

By Cordelia L Rochie | Ochie | 1 Apr 2021


Capitalism is a system in which individuals have ownership rights over goods, property and factors of production and free to trade free to use them produce any item in any quantity to satisfy desires personal or personal interest. Moreover, government power is limited so as not to interfere individual freedom.

But is Capitalism that simple? In fact, many individuals are like that calls himself a capitalist. But clashed with other capitalists. In fact, most of the examples fundamental questions such as How much government intervention in economic policy done?

To answer the previous question, there are three main thoughts that Capitalism has dissent. First, the concept of capitalism which was inspired by the Austrian School of Economics. This idea was put forward by three Austrian people, namely Carl Menger, Friedrich von Wieser and Eugen Böhm von Bawerk.

The Austrian premise is the understanding that humans have desires and the expected consequences of the choices made. The formula that is expressed is every individual in the world it has its own wants and goals and every individual has hope.

What will be gained by fulfilling this desire will eventually pay off different human attitudes at any given time. Austrian ideology implies that it does not exist limit the number, because each with its subjective choices.

For example Cake. There are those who like chocolate-flavored cakes, namely chocolate cakes, and some like original cakes. This is due to the subjectivity of each each consumer. Austrian understanding also believes that the price of a good is subjective and interdependent.

Subjectively defined as the price of an item Like consumer goods such as bread and drink, clothing is determined by the subjective desires of the individual and its economic capabilities. Interdependence is defined as the price of certain goods determined by the price of other goods.

Suppose the price of wheat bread is determined by the price of flour used for wheat bread and the price flour is determined by the price of flour. Likewise with goods which are capital goods. Like sewing machines, ovens, and the like, their value is determined by their ability to produce.

This which results in the understanding that certain institutions and interactions are complex formed because of subjective choice. Economic systems, money, ethics, law, and, in fact, language is produced by this interaction. For example the $50 banknote that we use it turned out that it only cost 10 cents to produce it. But the value for money is still $50.

Austrian School of Economics which states that the economy is determined by subjective choices varies by millions of people and where those choices will change over time. This is what emphasizes why every human being should have freedom producing goods and services to fulfill them.

Each individual is also free to determine the price according to market demand. And if someone wants to be free to produce goods and services efficient, then the protection of ownership rights over capital and property must be maintained.

Therefore, This understanding confirms that economic management by the government can never be an effective economic system because the government can never learn everything subjective human desire.

Apart from the Austrian School of Economics there is a thought of capitalism no less important is the Keynesian created by John Maynard Keynes from 1929 until 1939.

This thought was triggered by Keynes' concern for the perceptions of the judging community the failure of capitalism which resulted in the economic crisis that hit the United States.

Market stocks fall, investment purchasing power decreases, unemployment is rampant in 1933 when there were 14 million unemployed in the United States, the peasants failed harvests and the number of homeless people skyrocketed.

In addition, the impact of the First World War and the magnitude of poverty and unemployment in Europe. These things which caused Keynes to worry that society would be forced to choose the type of economy authoritarianism like Communism and Fascism to get a better economy though you have to do it sacrifice individual freedom. Keynes believed that the values ​​of Capitalism, namely freedom, individualism and economic efficiency must be maintained.

But the market and the economy must be regulated to bring prosperity to society. In his book, entitled The General Theory of Employment, Interest and Money, he advises government to implement fiscal and monetary policy.

The government must also invest public sector to improve people's welfare. Keynes also filed a progressive tax improve infrastructure and control interest rates. This is what put Keynes in his place unique to the political spectrum. Left-wing politicians consider Keynes a capitalist and right-wing politicians consider Keynes Keynes as a Socialist.

The last is Extreme Capitalism, Capitalism Extreme is applied by Nazis in Germany and Fascists in Italy. In the system of Extreme Capitalism the elite, military officers and wealthy businessmen are given freedom extraordinary parties with the guarantee to support the government in various ways.

State will determine the course of the economy in collaboration with the elite. Meanwhile the workers and the workers were greatly oppressed on the basis of unity.

Some effort must be made public interest is given to the private sector or private with state supervision. Therefore, even though the name of the Nazi party was the Socialist Nationalist Party, the principles were applied is Extreme Capitalism.

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Cordelia L Rochie
Cordelia L Rochie

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Ochie
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