Capitalism Versus Communism: Contrasting Two Government Systems

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A prosperous economy is solely reliant on the structure of a government’s economic system. Amongst the 195 countries worldwide, an astronomical amount of governance systems are available for use. Of these structures, many are implemented into our current model of the state. Some include the common leadership styles: constitutional democracy, monarchy, theocracy, adhocracy, androcra, and so forth. However, the most controversial, widely discussed and analyzed forms of government are communism and capitalism. “Capitalism promotes class distinction, where each person works for self-benefit. Contrastingly, communism promotes an egalitarian society where each member collectively contributes to the benefit of the society.” (cited) Communism and capitalism are contrastable through wealth distribution, factors of production, and systems of governance.

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Wealth distribution reveals the wealth of various societal members or groups and is different between communism and capitalism. In a capitalist-based economy, every individual works to make financial ends meet; however, in a communist-based economy, money is given as per need and ability. “Capitalism improves the productivity and work ethic”(cited) of its members as every person is forced to work for their money and is given their deserved amount for their contributions. Communism provides its members with shares of profit based on a fixed amount. For instance, an individual working 43 hours a week receives the same pay and equity as an individual working 12 hours, if needed. Likewise, in communism, all tax is distributed equally amongst its members. In contrast, in a capitalist orchestrated community, tax brackets are implemented so those who are making exorbitant amounts of money are paying more. It is imperative to distinguish between the wealth distribution of the two government styles. They are the foundation of how the two governing styles are ruan, therefore, the main distinguishing factor.

The differences between communism and capitalism can also be exhibited through the factors of production; the general inputs used to produce goods and services to make a profit. Land, labor, capital, and entrepreneurship are the four categories of this distinctive process. In capitalist societies, starting a business is challenging due to the competitive market fieldset in action. When one single company has a larger market share in comparison to its competitors, they use this incentive to eliminate the competition. As a result, many businesses file for bankruptcy. In a communist society, the market is state-controlled. Here, there are no competitive incentives, thus eliminating the opportunity for businesses to hold a monopoly amongst their similar services. In terms of the social capital aspect in capitalism, everything is privately owned, while. I in communism, everything is state-owned. This likewise takes away the incentives for workers to work as diligently because money is disputed as per need and ability.

Communism and capitalism are differentiated between their systems of governance, the prevalent leadership method used to lead society. In capitalism there is a democratic society present which means the government is run through elected representatives, favoring equal rights, freedom of speech, and justice. In communism, the focus is building a totalitarian society. Here, opposition parties are prohibited, and restrictions on individuals are put in place. Consequently, one promotes the ideals of community rights under collective leadership, while the other orchestrates the ideology of individual rights under a sole dictator. In a communist society, government interferences are common, whereas the capitalist society usually has none. This all distinctly proves that capitalism fixates on class distinction, while the communist society promotes an egalitarian society.

In conclusion, communism and capitalism are contrasted on many levels. Concentration on the differences of how they operate, distinguishing them between wealth distribution, factors of production, and systems of governance are prevalent. Capitalism promotes individuality while communism promotes societal benefits as a priority instead of personal needs. It has been proven that capitalism is the better form of governance. Communism states of governance have not been able to thrive and a lot of these governments have been abolished. “In _____, there were about x countries with a communist-style of government. China, Cuba, North Korea, Laos, and Vietnam make the five remaining communist systems. Currently, Capitalism is the most used system of governing. Approximately _____ countries including ___,___, and___ follow this style. have a. The smartest guy in the room is not smarter than the collective intelligence of everyone else in the room.”(cited) This quote further proves that each individual can bring their own assets and intelligence into a society. Everyone contributing as a collective will always be smarter than government planners. A collective of individuals making decisions will result in a more optimal outcome than the smartest guy in the country planning for everyone. This is why communist-based countries don’t succeed. Consequently, the more the state controls decisions through autocracy, the worse the outcomes become. Concluding that Capitalism is the better system and makes a significant difference when implemented into a system of governing.

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