I do not believe Tulsi is a socialist, because she believes that the means of production and distribution of goods and services should NOT be owned or controlled by the government. She appears to advocate for a mixed economic system (which is what the U.S. currently is). I don’t think we need to worry about Tulsi’s economic policies, because if they are bad, they probably won’t pass the House and Senate. She appears to be a reasonable person and would work with those who oppose her if their views seem helpful to the country. I admire her authenticity and genuine concern for the welfare of those under her rule. I have noticed that in an attempt to keep Tulsi from gaining steam, she is probably being labelled as a socialist, in order to get Trump voters to oppose her. This is not fair because Trump, himself, is working in a mixed economy and shows government favoritism towards certain sectors in the economy. Trump, himself, is not a pure capitalist. He attempts to use labels on his opponents to discredit them, knowing the emotional connotations associated with these labels. This is rather hypocritical of him since this is exactly what some Democrats do to him. Rather than discuss issues intelligently, elections in the U.S. seem to appeal to labels rather than intelligent discussion.
Rather, what is really happening, is that the Republicans favor some sectors that the Democrats don’t favor. So the argument is not between capitalism and socialism, but rather, over which sectors of the economy the government is allowed to interfere with. The Republicans seeming to favor legislation that allows some capitalist cronies to have unfair advantages, with the Democrats wanting other capitalist cronies to have unfair advantages. The solution seems to lie somewhere in the middle. But to frame the argument as a debate between capitalism and socialism is inaccurate. It is a debate over how the government should be involved in a mixed economy.
From an evangelical perspective, the Bible seems to favor the mixed economy mode and the nation of Israel when it obeyed God was NOT a capitalist economy, but rather a mixed economy with aspects of socialism. As a God fearing leader, the government should be involved in legislation that helps the poor and the outcast, but to do so in a manner that does not overly control the private sector. The happy medium would seem to be the Biblical response.
Conservative Republicans preach capitalism like it’s a religion! Like it will fix all our economic problems. I believe this is a misguided approach to how to handle the poor and helpless and will not lead to solutions. It also does not sufficiently address those who take advantage of the poor and who are in positions of power.
During Christ’s future millennial reign, with a perfect ruler in Christ, the Bible states that the land will enjoy her sabbaths, insinuating that Christ’s government WILL ENFORCE A SABBATH YEAR on production. Leviticus 26:34. Talk about GOVERNMENT REGULATION!
Leviticus 25 about the sabbath year and the year of jubilee definitely puts some regulation on how the economy should operate! Regulations were put on prices, interest rates, and slaves were to be set free, loans forgiven, sale of property, etc. Those who think pure capitalism is a Biblical concept should consider this! There are even verses that encourage a bit of the welfare state:
“If you lend money to any of My people who are poor among you, you shall not be like a moneylender to him; you shall not charge him interest.”
One of the first verses in the Bible about the poor is tied to the issue of debt. God did not want his people taking advantage of a poor man by charging excessive interest. Oh wait, check that…they were to charge the poor no interest at all. Loaning the money was fine, but the lender was not to expect anything back other than the original loan amount. God stated this command again in Leviticus 25:36-37.
“And you shall not glean your vineyard, nor shall you gather every grape of your vineyard; you shall leave them for the poor and the stranger: I am the Lord your God.”
Here we see God providing a way for the poor to find food. He instructed the farmers to not pick every single grape from their grapevine. Instead, they were to leave a few behind so the poor could come in after the workers had left and glean from the leftovers.
While I agree that the Bible does not support the idea of taking from the rich in order to make everybody have the same income level, and that it is the job of the church, not the government, to take care of the poor in their church. BUT this does not rule out the government having a role in taking care of the poor and helpless! The Bible does present the Jewish nation governed under God as the ideal form of government. The rules for this government are in Leviticus and throughout much of Exodus, Deuteronomy and the Bible books written by Moses. In this “ideal” government, we have a what I would call a mixed economy, a blend between socialism and capitalism.
While the Bible does not condemn riches, it does condemn becoming rich at the expense of the poor, which is what is happening in much of the world today. In America, crony capitalists parade under the Conservative evangelical banner of capitalism while they abuse the poor and become rich at their expense. This is behind much of the censorship we are experiencing, because the social media giants are not regulated and have created unfair monopolies that eliminate competition against those who do not adhere to the ideology of the elite, who may be the advertisers who support the social media giants. The Bible would seem to support regulating these social media giants and forcing them to treat others fairly in their business dealings, whether it means breaking them up or regulating them. Tulsi Gabbard wants to hold these crony capitalists accountable, and God and the Bible are with her!
A crony capitalist is one who has a relationship with the government that protects them from their criminal activities in economics. These social media giants take advantage of a law that states they are private companies and so they say they are immune from government regulation and can censor people just because they are private companies. BUT they have a MONOPOLY, because they are unregulated and most social media giants cater to those who give them financial support (their advertisers), where freedom of speech is determined by the prejudices of the elite ruling class who pay the bills for those in the monopoly. Tulsi Gabbard wants to address this issue. So while you scream that she is a socialist, which she is NOT, because she may want to break up the tech giants, would you complain that if government regulates these social media giants, that it would restore some competition and freedoms? This is a type of “socialism” the Bible would support!
In fact, I would say the reason Trump has not acted in this matter of censorship, is because he claims to be a total capitalist and is afraid that if he regulates these social media giants, he will be rightly accused of carrying out socialist policies. He’s so concerned about appearing like a traditional Conservative Republican, that he is more concerned with appearances than TRUE JUSTICE.
All I have to say is, you Conservatives out there need to think through deeply your beliefs and understand that the Bible does not support PURE capitalism, but rather, a MIXED ECONOMY, a blend between capitalism and socialism. So just cuz some of Tulsi Gabbard’s policies seem socialist, don’t let this label blind you to the effectiveness and justice of some of her policies.
For instance, Medicare for All, if implemented like my National Health Care Plan, will save everyone money and also give everyone health care. https://gabriellechana.blog/2019/05/08/empress-gail-chord-schulers-national-health-care-plan/
We have to get away from divergent thinking, this idea that everything is black and white. Sometimes the best course is gray, a blend between two extremes. That is the case in economics. We need to implement some socialist ideas and some capitalist ideas, and the way we decide which ideas to implement is to choose a route that maximizes freedom, but also takes care of the poor, marginalized and helpless. We need to do all of this.
You might say, that is SOCIALISM, a violation of the free market economy to regulate the social media giants. It is anti-Bible! Well, perhaps it is a form of socialism, but not anti-Bible, because we only regulate those who are taking advantage of the poor, not everybody. But even if it is a form of socialism, the Bible is NOT against a government interfering in an economy to help out poor people being abused by the rich.
While Trump says he cares about those who are marginalized, he does NOTHING, because he is catering to the rich and powerful who finance his campaigns, and these same rich and powerful who finance his campaign, also take advantage of the poor to ensure they retain their monopoly. The Bible would condemn such behavior in Trump and the government and would expect the government to help out the poor in this matter.
Conservative evangelicals must understand that while the Bible does not support pure socialism (described as using government to regulate and control all aspects of the economy), it does support limited socialism or a mixed economy (what we currently have in the U.S. today).
Those who preach against socialism, should also favor the elimination of the Federal Reserve, because that is extreme government regulation of the economy. If the Dems want to go after foreign government interference, they need to go after the Federal Reserve, which has been traditionally controlled by FOREIGN interests (outside the U.S.). Tulsi Gabbard wants to audit the Federal Reserve.
– Gail Chord Schuler
, B.S. Mechanical Engineering and Physics & Physics and Economics: Tulsi is (a socialist) if she believes that the government should own or own the right to private property and its use.
socialism: “the economic system in which the means of production and distribution of goods and services is owned or controlled by the government.” By extension, the government controls wealth and income.
Here is an example: She and all that agree with this person (Hillary Clinton) are socialists.
“The oil companies reported the highest profits in the history of the world. I want to take those profits and I want to put them in an alternative energy fund.” Hillary Clinton –
Mixed System or Pure Capitalism?(taken from https://www.investopedia.com/terms/c/capitalism.asp)
When government owns some but not all of the means of production, but government interests may legally circumvent, replace, limit, or otherwise regulate private economic interests, that is said to be a mixed economy or mixed economic system. A mixed economy respects property rights, but places limits on them. Property owners are restricted with regards to how they exchange with one another. These restrictions come in many forms, such as minimum wage laws, tariffs, quotas, windfall taxes, license restrictions, prohibited products or contracts, direct public expropriation, anti-trust legislation, legal tender laws, subsidies, and eminent domain. Governments in mixed economies also fully or partly own and operate certain industries, especially those considered public goods, often enforcing legally binding monopolies in those industries to prohibit competition by private entities.
In contrast, pure capitalism, also known as laissez-faire capitalism or anarcho-capitalism, all industries are left up to private ownership and operation, including public goods, and no central government authority provides regulation or supervision of economic activity in general.
The standard spectrum of economic systems places laissez-faire capitalism at one extreme and a complete planned economy (like communism) at the other. Everything in the middle could be said to be a mixed economy. The mixed economy has elements of both central planning and unplanned private business. By this definition, nearly every country in the world has a mixed economy, but contemporary mixed economies range in their levels of government intervention. The U.S. and the U.K. have a relatively pure type of capitalism with a minimum of federal regulation in financial and labor markets, sometimes known as Anglo-Saxon capitalism, while Canada and the Nordic countries have created a balance between socialism and capitalism. Many European nations practice welfare capitalism, a system that is concerned with the social welfare of the worker, and includes such policies as state pensions, universal healthcare, collective bargaining, and industrial safety codes.
What Is Socialism?
Socialism is a populist economic and political system based on the public ownership (also known as collective or common ownership) of the means of production. Those means include the machinery, tools and factories used to produce goods that aim to directly satisfy human needs. Communism and socialism are umbrella terms referring to two left-wing schools of economic thought; both oppose capitalism, but socialism predates the “Communist Manifesto,” an 1848 pamphlet by Karl Marx and Friedrich Engels, by a few decades.
In a purely socialist system, all legal production and distribution decisions are made by the government, and individuals rely on the state for everything from food to healthcare. The government determines output and pricing levels of these goods and services.
Socialists contend that shared ownership of resources and central planning provide a more equal distribution of goods and services and a more equitable society.
Common ownership under socialism may take shape through technocratic, oligarchic, totalitarian, democratic or even voluntary rule. Prominent historical examples of socialist countries include the former Soviet Union and Nazi Germany. Contemporary examples include Cuba, Venezuela and China.
Due to its practical challenges and poor track record, socialism is sometimes referred to as a utopian or “post-scarcity” system, although modern adherents believe it could work if only properly implemented. They argue socialism creates equality and provides security – a worker’s value comes from the amount of time he or she works, not in the value of what he or she produces — while capitalism exploits workers for the benefit of the wealthy.
Socialist ideals include production for use, rather than for profit; an equitable distribution of wealth and material resources among all people; no more competitive buying and selling in the market; and free access to goods and services. Or, as an old socialist slogan describes it, “from each according to ability, to each according to need.”
Origins of Socialism
Socialism developed in opposition to the excesses and abuses of liberal individualism and capitalism. Under early capitalist economies during the late 18th and 19th centuries, western European countries experienced industrial production and compound economic growth at a rapid pace. Some individuals and families rose to riches quickly, while others sank into poverty, creating income inequality and other social concerns.
The most famous early socialist thinkers were Robert Owen, Henri de Saint-Simon, Karl Marx, and Vladimir Lenin. It was primarily Lenin who expounded on the ideas of earlier socialists and helped bring socialist planning to the national level after the 1917 Bolshevik Revolution in Russia.
Following the failure of socialist central planning in the Soviet Union and Maoist China during the 20th century, many modern socialists adjusted to a high regulatory and redistributive system sometimes referred to as market socialism or democratic socialism.
Socialism vs. Capitalism
Capitalist economies (also known as free-market or market economies) and socialist economies differ by their logical underpinnings, stated or implied objectives and structures of ownership and production. Socialists and free-market economists tend to agree on fundamental economics – the supply and demand framework, for instance – while disagreeing about its proper adaptation. Several philosophical questions also lie at the heart of the debate between socialism and capitalism: What is the role of government? What constitutes a human right? What roles should equality and justice play in society?
Functionally, socialism and free-market capitalism can be divided on property rights and control of production. In a capitalist economy, private individuals and enterprises own the means of production and the right to profit from them; private property rights are taken very seriously and apply to nearly everything. In a socialist economy, the government owns and controls the means of production; personal property is sometimes allowed, but only in the form of consumer goods.
In a socialist economy, public officials control producers, consumers, savers, borrowers, and investors by taking over and regulating trade, the flow of capital and other resources. In a free-market economy, trade is conducted on a voluntary, or nonregulated, basis.
Market economies rely on the separate actions of self-determining individuals to determine production, distribution, and consumption. Decisions about what, when and how to produce are made privately and coordinated through a spontaneously developed price system and prices are determined by the laws of supply and demand. Proponents say that freely floating market prices direct resources towards their most efficient ends. Profits are encouraged and drive future production.
Socialist economies rely on either the government or worker cooperatives to drive production and distribution. Consumption is regulated, but it is still partially left up to individuals. The state determines how main resources are used and taxes wealth for redistributive efforts. Socialist economic thinkers consider many private economic activities to be irrational, such as arbitrage or leverage, because they do not create immediate consumption or “use.”
Bones of Contention
There are many points of contention between these two systems. Socialists consider capitalism and the free market to be unfair and possibly unsustainable. For example, most socialists contend that market capitalism is incapable of providing enough subsistence to the lower classes. They contend that greedy owners suppress wages and seek to retain profits for themselves.
Proponents of market capitalism counter that it is impossible for socialist economies to allocate scarce resources efficiently without real market prices. They claim that the resultant shortages, surpluses and political corruption will lead to more poverty, not less. Overall, they say, that socialism is impractical and inefficient, suffering in particular from two major challenges.
The first challenge, widely called the “incentive problem,” says no one wants to be a sanitation worker or wash skyscraper windows. That is, socialist planners cannot incentivize laborers to accept dangerous or uncomfortable jobs without violating the equality of outcomes.
Far more serious is the calculation problem, a concept originating from economist Ludwig von Mises’ 1920 article “Economic Calculation in the Socialist Commonwealth.” Socialists wrote Mises, are unable to perform any real economic calculation without a pricing mechanism. Without accurate factor costs, no true accounting may take place. Without futures markets, capital can never reorganize efficiently over time.
Can a Country be Both?
While socialism and capitalism seem diametrically opposed, most capitalist economies today have some socialist aspects. Elements of a market economy and a socialist economy can be combined into a mixed economy. And in fact, most modern countries operate with a mixed economic system; government and private individuals both influence production and distribution.
Economist and social theorist Hans Herman Hoppe wrote that there are only two archetypes in economic affairs – socialism and capitalism – and that every real system is a combination of these archetypes. But because of the archetypes’ differences, there is an inherent challenge in the philosophy of a mixed economy and it becomes a never-ending balancing act between predictable obedience to the state and the unpredictable consequences of individual behavior.
How Mixed Economies Develop
Mixed economies are still relatively young and theories around them have only recently codified. “The Wealth of Nations,” Adam Smith’s pioneering economic treatise, argued that markets were spontaneous and that the state could not direct them, or the economy. Later economists including John-Baptiste Say, F.A. Hayek, Milton Friedman, and Joseph Schumpeter would expand on this idea. However, in 1985, political economy theorists Wolfgang Streeck and Philippe Schmitter introduced the term “economic governance” to describe markets that are not spontaneous but have to be created and maintained by institutions. The state, to pursue its objectives, needs to create a market that follows its rules.
Historically, mixed economies have followed two types of trajectories. The first type assumes that private individuals have the right to own property, produce and trade. State intervention has developed gradually, usually in the name of protecting consumers, supporting industries crucial to the public good (in fields like energy or communications) providing welfare or other aspects of the social safety net. Most western democracies, such as the United States, follow this model.
The second trajectory involves states that evolved from pure collectivist or totalitarian regimes. Individuals’ interests are considered a distant second to state interests, but elements of capitalism are adopted to promote economic growth. China and Russia are examples of the second model.
Transitioning from Socialism
A nation needs to transfer the means of production to transition from socialism to free markets. The process of transferring functions and assets from central authorities to private individuals is known as privatization.
Privatization occurs whenever ownership rights transfer from a coercive public authority to a private actor, whether it is a company or an individual. Different forms of privatization include contracting out to private firms, awarding franchises and the outright sale of government assets, or divestiture.
In some cases, privatization is not really privatization. Case in point: private prisons. Rather than completely ceding a service to competitive markets and the influence of supply and demand, private prisons in the United States are actually just a contracted-out government monopoly. The scope of functions that form the prison is largely controlled by government laws and executed by government policy. It is important to remember that not all transfers of government control result in a free market.
Privatizing a Socialist Economy
Some nation-wide privatization efforts have been relatively mild, while others have been dramatic. The most striking examples include the former satellite nations of the Soviet Bloc after the collapse of the U.S.S.R. and the modernization of the post-Mao Chinese government.
The privatization process involves several different kinds of reforms, not all of them completely economic. Enterprises need to be deregulated and prices need to be allowed to flow based on microeconomic considerations; tariffs and import/export barriers need to be removed; state-owned enterprises need to be sold; investment restrictions must be relaxed and the state authorities must relinquish their individual interests in the means of production. The logistical problems associated with these actions have not been fully resolved and several different theories and practices have been offered throughout history.
Should these transfers be gradual or immediate? What are the impacts of shocking an economy built around central control? Can firms be effectively depoliticized? As the struggles in Eastern Europe in the 1990s show, it can be very difficult for a population to adjust from complete state control to suddenly having political and economic freedoms.
In Romania, for example, the National Agency for Privatization was charged with the goal of privatizing commercial activity in a controlled manner. Private ownership funds, or POFs, were created in 1991. The state ownership fund, or SOF, was given the responsibility of selling 10% of the state’s shares each year to the POFs, allowing prices and markets to adjust to a new economic process. But initial efforts failed as progress was slow and politicization compromised many transitions. Further control was given to more government agencies and, over the course of the next decade, bureaucracy took over what should have been a private market.
These failures are indicative of the primary problem with gradual transitions: when political actors control the process, economic decisions continue to be made based on noneconomic justifications. A quick transition may result in the greatest initial shock and the most initial displacement, but it results in the fastest reallocation of resources toward the most valued, market-based ends.
What is a Mixed Economic System?
A mixed economic system is a system that combines aspects of both capitalism and socialism. A mixed economic system protects private property and allows a level of economic freedom in the use of capital, but also allows for governments to interfere in economic activities in order to achieve social aims. According to neoclassical theory, mixed economies are less efficient than pure free markets, but proponents of government interventions argue that the base conditions required for efficiency in free markets, such as equal information and rational market participants, cannot be achieved in practical application.
- A mixed economy is an economy organized with some free market elements and some socialistic elements, which lies on a continuum somewhere between pure capitalism and pure socialism.
- Mixed economies typically maintain private ownership and control of most of the means of production, but often under government regulation.
- Mixed economies socialize select industries that are deemed essential or that produce public goods.
- All known historical and modern economies are examples of mixed economies, though some economists have critiqued the economic effects of various forms of mixed economy.
Understanding Mixed Economic Systems
Most modern economies feature a synthesis of two or more economic systems, with economies falling at some point along a continuum. The public sector works alongside the private sector, but may compete for the same limited resources. Mixed economic systems do not block the private sector from profit-seeking, but do regulate business and may nationalize industries that provide a public good. For example, the United States is a mixed economy, as it leaves ownership of the means of production in mostly private hands but incorporates elements such as subsidies for agriculture, regulation on manufacturing, and partial or full public ownership of some industries like letter delivery and national defense. In fact, all known historical and modern economies fall somewhere on the continuum of mixed economies. Both pure socialism and pure free markets represent theoretical constructs only.
What Is the Difference Between a Mixed Economy and Free Markets?
Mixed economic systems are not laissez-faire systems, because the government is involved in planning the use of some resources and can exert control over businesses in the private sector. Governments may seek to redistribute wealth by taxing the private sector, and using funds from taxes to promote social objectives. Trade protection, subsidies, targeted tax credits, fiscal stimulus, and public-private partnerships are common examples of government intervention in mixed economies. These unavoidably generate economic distortions, but are instruments to achieve specific goals that may succeed despite their distortionary effect.
Countries often interfere in markets to promote target industries by creating agglomerations and reducing barriers to entry in an attempt to achieve comparative advantage. This was common among East Asian countries in the 20th century development strategy known as Export Led Growth, and the region has turned into a global manufacturing center for a variety of industries. Some nations have come to specialize in textiles, while others are known for machinery, and others are hubs for electronic components. These sectors rose to prominence after governments protected young companies as they achieved competitive scale and promoted adjacent services such as shipping.
Difference From Socialism
Socialism entails common or centralized ownership of the means of production. Proponents of socialism believe that central planning can achieve greater good for a larger number of people. They do not trust that free market outcomes will achieve the efficiency and optimization posited by classical economists, so socialists advocate nationalization of all industry and the expropriation of privately owned capital goods, lands, and natural resources. Mixed economies rarely go to this extreme, instead identifying only select instances in which intervention could achieve outcomes unlikely to be achieved in free markets.
Such measures can include price controls, income redistribution, and intense regulation of production and trade. Virtually universally this also includes the socialization of specific industries, known as public goods, that are considered essential and that economists believe the free market might not supply adequately, such as public utilities, military and police forces, and environmental protection. Unlike pure socialism however, mixed economies usually otherwise maintain private ownership and control of the means of production.
History and Criticism of the Mixed Economy
The term mixed economy gained prominence in the United Kingdom after World War II, even though many of the policies associated with it at the time were first proposed in the 1930s. Many of the supporters were associated with the British Labour Party.
Critics argued that there could be no middle ground between economic planning and a market economy, and many — even today — question its validity when they believe it to be a combination of socialism and capitalism. Those who believe the two concepts don’t belong together say either market logic or economic planning must be prevalent in an economy.
Classical and Marxist theorists say that either the law of value or the accumulation of capital is what drives the economy, or that non-monetary forms of valuation (i.e. transactions without cash) are what ultimately propel the economy. These theorists believe that Western economies are still primarily based on capitalism because of the continued cycle of accumulation of capital.
Austrian economists starting with Ludwig von Mises have argued that a mixed economy is not sustainable because the unintended consequences of government intervention into the economy, such as the shortages that routinely result from price controls, will consistently lead to further calls for ever increasing intervention to offset their effects. This suggests that the mixed economy is inherently unstable and will always tend toward a more socialistic state over time.
Beginning in the mid 20th century, economists of the Public Choice school have described how the interaction of government policy makers, economic interest groups, and markets can guide policy in a mixed economy away from the public interest. Economic policy in the mixed economy unavoidably diverts the flow of economic activity, trade, and income away from some individuals, firms, industries, and regions and toward others. Not only can this create harmful distortions in the economy by itself, but it always creates winners and losers. This sets up powerful incentives for interested parties to take some resources away from productive activities to use instead for the purpose of lobbying or otherwise seeking to influence economic policy in their own favor. This non-productive activity is known as rent-seeking.