Capitalism

Capitalism is a system where individuals have rights of ownership to goods, property, and means of production and free to transact it and also free to utilize it to produce any goods in whatever amount to fulfill its self interest Moreover government power should be limited so that it won't curtail individual freedom. But is capitalism that simple? The fact is many self proclaimed capitalist tend to disagree with one another. Even the most basic question like "How much can we tolerate government intervention?" To answer previous questions,there are three main capitalist thoughts with different opinion. First is a capitalism that is inspired by Austrian School of Economics. This thoughts is put forth by three Austrian: Carl Menger, Friedric Von Wieser and Eugen Böhm von Bawerk. The basic of Austrian thought is that humans possess wants and wishes of the consequences of preferred choice the formula is every individual in this world have their own wants and goalsand every individual have hopes about what can be achieved by fulfilling those wants. In the end, it will create numerous and different human behavior. Austrian school stated that there is no limit to the quantity due to subjective choices of each individual. Take instant noodle for example: Some like chicken onion noodle, some like fried noodles This is because each of consumer is subjectiveAustrian school also stated that the price of a good is subjective and depended towards one another subjective means that the price of a goodlike bread, drink, and clothes is determined by subjective wants ofindividual and their economic capabilitiesdependent means that the price of a good is determined by the price of other stake. Example of the price of a bread that is determined by the price of the flour that is used to make the breadand the price of the flour is determined by the price of the wheat. So does the price of capital goodslike sewing machine, oven, etc the price is determined by its capabilities to produce. This facts is what resulted in an understanding that institutions and complex interaction will be made due to subjective choices economic system, money, ethics, law, and even language is a rsult of said interactions. For example, the 100 dollar bills that we use turns out only cost 12 cent to produce but the value of those bills is still 100 Dollars. This is Austrian way of saying economy is determined by subjective choice that are different among millions of humans and where those choices will change as time goes on This is why every human has to have the freedom to produce the goods and services to fulfill those choices. Every individual should also be free to determine the price according to the market need. And if someone wanted to produce goods and services freelyand more efficiently, then protection of private property rights should be maintainedtherefore this school of thought emphasize that economic managementby the government will never be effective because the government will never be able to learn all subjective need of human being.Other than Austrian School of Economics There is another equally important school of thought which is Keynesian economics by John Maynard Keynes. in 1929 until in 1939 this thought surfaced due to Keynes fear that the masseswill see the failure of capitalism that causedeconomic crisis in USA. Stock market crash, fall of purchasing powerlack of investment, and rampant unemployment. Especially in 1933 where there are over 15 million unemployed in USA. Farmers experienced failed crops and homelessness skyrocket. Other than that, world war 1 and poverty in europe raise concern to Keynes. People would prefer authoritarian system like communismand fascism to gain better economic conditionsat the expense of individual liberty. Keynes still believe capitalist values like liberty and individualism along side with efficient economic system have to be maintained but the market and the economy have to be regulated to bring welfare to the people. In hi book "'The General Theory of Employment, Interest and Money". He suggested the government to impose fiscal and monetary policyand public sector investment to increase the welfare of the people. Keynes also suggested progressive tax infrastructure development and control over interest rate. This put Keynes in unique position in political spectrum. Leftist label Keynes as a capitalist while right wing said Keynes is a socialist. Last we have extreme capitalism.This system is applied in Nazi Germany and Fascist Italy. In this system The elite, military, and wealthy businessman is given huge power in exchange of their support for the governmentin many ways. State will command the course of economy and cooperate with the elites while working class is oppressed under the guise of unity. Things that should be dedicated to public needswere given to the private sector under the supervision of the states. Therefore, despite the name "Nazi" is National-Socialist party, the principle that are bieng appliefis nothing but an extreme capitalism.