Essay Sample about American Capitalism

📌Category: Economics, United States, World
📌Words: 630
📌Pages: 3
📌Published: 22 January 2022

As a nation, America has a set of collective values that define its government, society, and culture. At the top of the list, Americans value freedom and democracy. This is evident through many expressions, including the Constitution, the legal system, elections, and the economic system America employs-- capitalism. In addition to casting ballots for elected officials, capitalism allows the people to have more control over their society. The people hold corporations and businesses accountable, and they determine the value of a product or service. Under capitalism, the voluntary collaboration of workers in various industries ensues to create products, services, and companies that benefit all. Capitalism works naturally; people do not need to be coerced into participating. Instead, they voluntarily trade their labor for goods and services, cooperating with countless other people. This is disrupted when an unnecessary central power intervenes with the natural flow of the system. 

Democracy in America goes further than citizens voting once every few years, or even running for office. Under capitalism, the people also decide which businesses survive, which professional practices are acceptable, and what the value of a product or service should be. In the video “Is Capitalism Moral?”, the topics of accountability and fairness in this economic system are discussed. Businesses are accountable to the consumer—if a business does not provide a valuable service, or they conduct business in a way consumers do not approve of, they will not be successful. The way consumers spend money is comparable to their vote on a ballot—each dollar spent somewhere helps that business survive and grow. Another facet of democracy and fairness within capitalism is the idea and reality that one gains from society when one contributes to society. All people contribute what they can by laboring at jobs or starting a business. This allows them to trade the money they have earned for goods and services. Everyone helps each other when this happens.

One of the most important aspects of Capitalism, that allows it to be successful, is the absence of a mastermind. There is not one person, nor a group of people, ordering everyone else to do what they do. Instead, all work is done by voluntary and spontaneous cooperation. The movie “I, Pencil” demonstrates this by explaining the creation of a pencil. It takes hundreds of thousands of people to create a simple pencil, including lumberjacks, waitresses who serve them, people working in factories, those who paved the roads everyone involved drives on, etc. This type of collaboration does not happen under coercion. No governing power forces anyone into this. Innovation and the creation of goods, like the pencil, happens because people trade their labor and creativity for money, so they can trade the money for goods and services. Capitalism is a cycle that benefits all participating and works well as long as it is not interfered with. 

Capitalism works like democracy—the majority vote wins and there is not one central leader. However, sometimes the government disrupts this. Cronyism, when the government offers privileges to certain people or businesses because of their status, undermines capitalism. For example, if a business is not profiting and has to close its doors, it is a result of consumers not valuing them enough and essentially voting for them to shut down. Cronyism means the government would grant this business a bailout, using taxpayer money, to save the company and undermine the vote of consumers. In addition, the government instilling too many regulations on businesses hurts small businesses' chance of success, steals the voice of the consumer, and takes away citizen’s choices. Capitalism works best when it is left to happen naturally. When it is interfered with, everyone suffers. 

In conclusion, capitalism is a moral economic system that enables democracy. It works naturally as a result of voluntary collaboration and cooperation among workers and business owners. There is no central power to coerce workers into participating—they do it because they value the money they earn and the goods they can buy with it. The natural cycle of capitalism is effective, but when it is interfered with via cronyism, problems arise. Government interfering with the system undermines capitalism.

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