This essay will cover the basics of the three economic systems; communism, socialism and capitalism. Each economic system will be defined, then explained in further detail, compared and contrasted to the others, and illustrated with real-life examples. Communism is an economic system where the government owns and operates the means of production and distribution. On the other end of the spectrum is capitalism, where private individuals own and operate the means of production and distribution. A socialist economic system is defined as a mixed market; the basic means of production are owned and managed by the government, but individuals own and operate many private businesses.
A capitalist system gives every individual the right to work for, and earn as much as they want, unlike communism where (in aspirations of full employment and income equality) individual effort is not rewarded. (Why work so hard to be a great doctor when I can do almost nothing and get the same payment?") This lack of competition hurts the quality of goods and services, and results in a low standard of living, with few luxuries. However, in capitalism, it is the market that determines what goods will be bought and sold and in what quantity, creating competition, which keeps prices low and quality high. (Socialism stresses cooperation rather than competition.) Capitalism and socialism share common goals; a high standard of living, and economic security. But, because a socialist system's government ensures things like healthcare and education by providing them for free, the people pay very high taxes. .
This past summer I visited family in Sweden, a socialist country, and learned some of these differences. Other examples of socialism include Switzerland, and Canada's health care system. Even the capitalist U.S.A. has "socialist traits." For instance, the government runs the armed forces, etc. (I won't soon forget the point that a wise man made once about the logic behind never seeing advertisements for "JT's Marines! " in the yellow pages.