Grey Wolf wrote: |
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If by fence sitter you mean that I don't come down on the side of either of two extremist views |
Yes, that's what I mean.
Grey Wolf wrote: |
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then I take that as a compliment |
You are welcome!
In fact, I just decided to come and sit by you.
It's not meaningful to talk about the perfect economic system. Or, at least, it's more meaningful to talk about the best performing economic system while certain parameters have some specific values.
Let's take the population size and the individual's ability to fend for himself in a competitive environment (I'll call it survivability from now on) as the parameters. The first one is self explanatory. The second needs some clarification. I'll divide it into two parts. One that is granted to the individual upon birth (good genes etc...) and one that must be cultivated (knowledge, experience etc...) in order to be effective.
At the early stages of civilization (tribal communities) the population size is small, the mean of survivability is also small (because knowledge of the environment structure and function is small), but the variance is rather big, as survivability mostly depends on the individual's genes.
At a later stage, the population size is increased a bit, the mean of survivability goes up too (as people have a better understanding of the environment based on the experience acquired from the interaction with it). The variance of survivability now begins to shrink. You see, the first part of survivability remains the same (the human gene pool evolves much much slower than the collective knowledge of the human society increases), but the second part is increased for all members of the society, so any differences caused by the first part tend to disappear.
So, what we have here is a continuous increment of both the population (up to the carrying capacity of the planet) and the understanding of the environment (up to the limits imposed by our ability to understand -i.e. limitations of the human senses, theorem of incompleteness etc...). Also, the increment of practical knowledge results to an increment of the survivability mean and a decrement of the survivability variance.
Ok, that was enough introductory talking, let's see what these things have to do with the various economic systems.So, the main difference between socialism and capitalism is that in the former the means of production are public (i.e. entrusted by the community to a bunch of people that are supposed to know how to handle them efficiently), while in the latter the means of production are private (i.e. owned by individuals). Another difference, that is a direct result of the one just mentioned, is that in socialism we have a centrally planned economy, while in capitalism we have a free market economy.
Public ownership and centrally planned economy perform better when applied to a small-sized community where only few people are capable of making the right decisions (because they are smarter or/and more knowledgeable than the average population).
Private ownership and free market economy perform better when applied to large-sized populations where all people are (almost) equally capable of making the right decisions.
That said, it is only natural for a community to begin with socialism as an economic system and gradually turn to capitalism. This doesn't at all mean that capitalism is a better economic system. It just means that after a certain point, it is safe/efficient to give more power to the individuals because they are ready (and mature enough) to handle it.
EDIT: Fixed misc typos.