Greater Government Intervention In Economy

Greater Government Intervention in the Economy

Carlotta de Rosa

069832

29/04/13

Perfection cannot be obtained in a capitalist society because of competition. Competition can help society in many areas, such as improving technology, forcing individuals to work harder, and making more money for the overall economy. But ideal perfection can’t be realistic with competition.

With the term capitalism we intend an economic system based on the private ownership of the means of production, distribution, and exchange, characterized by the freedom of capitalists to operate or manage their property for profit in competitive conditions.

This is the model followed by most of the world nowadays, which is creating an enormous, and growing gap between the rich and the poor. Under this system, a small minority of people owns the means for producing and distributing goods. We refer to this group of people as the capitalist class. The majority of people must sell their ability to work in return for a wage or salary. This obviously crates a disproportion between the two classes. The working class are paid to produce goods and services, which are then sold for a profit. The capitalist class gains the profit.

Thus, the free market laws of supply and demand dictate that this system should be self-correcting, which increases the chance of creating inequalities among society. Nevertheless, these inequalities are the engine of the capitalist economic system and the more inequality it exists the faster it grows.

It is the class division and profit motive of capitalism that is at the root of most of the world's problems today, from starvation to war, to alienation and crime. Every aspect of our lives is subordinated to the worst excesses of the rush to make profit. In capitalist societies, our real needs will only ever come a tiny second to the requirements of profit.

However, this model naturally ensures higher quality in the overall production, but leaves those with fewer abilities in the dark. Accordingly, the conflict within the model makes it impossible to create a utopian society. Therefore, government intervention is required to avoid future conflicts and divisions.

Furthermore, government perfection is really hard to be attained because it is rare when everyone agrees on something that the government provides. Government has to maintain not only a good economic system, but also a stable society. In an ideally perfect government there cannot be any differentiation in taxes, nor can there be such a great difference between upper class and lower class. In a capitalistic society there is differentiation in taxes and a wide gap between upper and lower class incomes. Therefore, government makes possible the fluidity and functioning of the business world by enacting and implementing laws and policies that guarantee the rights of the individuals to own properties and have these rights secured and respected. Also, government must strengthen the institutions that could guarantee the security of the physical aspect of all private investments in a stable political climate.

Definitely, to get closer to a utopian society, neither has it to be completely based on free market economy nor it has to be controlled completely by the government. The ideal system is that in which the government guarantees a secure and politically stable field where all the players in economy can play freely within the realm of fairness and dignity.

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