America was founded upon the principles of hard work, justice, and equality of opportunity. These values are truly put into practice in Capitalist societies. In recent years, America has strayed further and further from capitalism and its values. It is time that we change this, and return to the fairness inherent in the capitalist system. “That sounds great,” you may say, “but does it matter in my day to day life? What is capitalism really, and what is socialism? Which one is better? Is one fairer? Which one will make me, my friends, and my family happier?” This article will answer these questions by outlining a few key differences between capitalism and socialism, and will prove that these differences should matter to you, for your own sake and that of your country.
Capitalism is a system in which the earner keeps most of his or her earnings, whereas socialism is a system in which the government takes some or most of the earnings for its own use.
In a pure capitalist society, every citizen has the opportunity to pursue whatever career he or she desires, and to keep most or all of the income generated earned in their career. If you hold a job, you keep the money you earn by doing that job. Regardless of whether you make $30,000 per year or $3,000,000 per year, you are taxed the same percentage – a flat tax. It’s that simple.
On the other hand, Socialism enacts a progressive tax system. This means that the better the job you choose to pursue,and thus, the more money you make, the higher your taxes will be. In an attempt to create a society in which there are no economic classes, socialism disincentives people to strive for high-paying jobs. Think about it this way: Let’s say that you make $100,000 per year, and have been offered a promotion that would allow you to make $125,000 per year. While you hold the $100,000 a year job, you pay 25% of that income in taxes which would be$25,000. Your net income is $75,000. If you choose to take the promotion, however, you will be taxed 45% of your income. Your net income will be $68,750. That’s less than your income before the promotion! Scenarios like this happen under socialist administrations all the time. Why would you ever strive for a higher-paying job if the government will just take away more of your money, only to give it to people who may or may not work at all?
Capitalists believe few regulations bring many opportunities. Socialists believe much of business should be regulated by the government.
Few economic regulations are enacted under capitalist administrations. This means that you are free to start your own business, climb the ladder in a large company, or work part time and stay home with your children. Capitalism means that the government will not interfere with your dreams.
Socialism will regulate anything and everything it can. Let’s say you have a really good idea – for the sake of the example, let’s call it a fast food restaurant that only serves affordable health food. You’ll have to pay each of your full time counter employees $31,200 a year – at a $15 minimum wage. That’s just a few thousand dollars less than what the average park ranger makes each year. You will have to pay enormous business tax rates. Then, trade will be regulated so that your business has little freedom to do what it needs to do to become successful.
Capitalism is a system of equality at the starting line. Socialism is a system of equality at the finish line.
Capitalists believe that everyone should have equal opportunity to pursue whatever career they desire. You can choose to build a career in medicine or law, or to not further your education after high school and work at a restaurant or retail store. Either of these, and everything in between, are perfectly valid options under capitalism. Capitalists also believe that people’s earnings should reflect the difficulty of the work they do. Thus, if you choose to work seventy hours a week as a computer programmer, for example, you should expect to make more money than a part time barista at Starbucks. This is fair; your job as a computer programmer requires more education and skill, so you deserve for that to be considered by your employer and the market.
True socialists believe that everyone, regardless of how long or hard they work, should earn the same amount of money. Thus, there is an enormous disincentive to choose a difficult career path. Why would you go to school so you could work as a doctor, lawyer, engineer, programmer, cryptographer or data analyst if you would earn a similar salary as a line cook, bartender, housekeeper, receptionist, or factory worker?