short report 1800-1
Capitalism refers to the economic system of private ownership of property, goods, and services as well as factors of production by free individuals. The elements of capitalism act as crucial roles of causing economic inequality since the pre-industrial period. People have traditionally produced commodities that they needed for survival and traded them for those that they could not produce themselves in order to satisfy their insatiable needs. The eighteenth and nineteenth centuries ushered in the industrial age that heightened the levels of inequality. In the post-industrial age, many nations attempt to resolve inequality by using political tools of governance. Capitalism has its roots spread so wide in the world, especially in the post-industrial age that the political tools of governance cannot control the rising inequality. But current government policies will not solve the problem. America needs to take other steps. Comment by Author: 50 words short of the absolute minimum. Comment by Author:
Capitalism，persistent part of today’s world and human progression, stems from the private ownership of factors of production. Individuals are constantly competing to come up with progressive innovations that set them ahead in society so as to accumulate wealth for them (Krugman, 2014). Most democratic governments in the world have accepted the harsh realities of capitalism for its ability to boost the economy despite the obvious setback of an increasing inequality between the rich and the poor. Despite the acceptance of capitalism, most of these democratic governments have set up tools of trying to redistribute wealth in the society and promote equality among all human beings. Government-imposed policies cannot eliminate economic inequality. Whereas embracing the same elements of capitalism that has caused inequality might serve as a better solution.
First, let us evaluate the contributing factors of inequality as a result of capitalism in the world. The changing forces and insecurity in the world contribute of inequality in most nations’ economies. Individual, family and group variations also serve as sources of inequality due to capitalism in the economy. Globalization and shifting value on the factors of production widen the inequality gap (Krugman, 2014). Equality exited during the pre-industrial period since individuals consumed all that they produced through their hard work. Production was also limited to only what a person required for survival and no one accumulated unnecessary extra wealth. The industrial age introduced self-cultivation that highlighted the differences among individuals, families and groups. Comment by Author: Awkward transition. You do not need it either. Comment by Author: You are using sources about America. Therefore focus on America. Comment by Author: These sentences repeat what you already stated in the first paragraph. The reader does not need repetition. Delete.
Specialization, as the first aspect of the industrial age, led to development of inequality. Individuals separated into groups according to skill and knowledge and produced what they knew best at producing then trading it for commodities they did not produce so as to satisfy their needs or meet particular demands. The introduction of specialization also led to the start of ownership of factors of production such as land, raw materials and capital. The value of these factors of production varied and so did the value of the commodities that resulted in the accumulation of wealth by some members of society (Piketty, 2014). The group of individuals who held inferior skill and factor of production in the community formed of the lower half of people with little wealth. Inequality thus enters the society with capitalism in the industrial age through the differentiation of individuals and groups. Comment by Author: Why does the reader need this history lesson to understand the current problem. Next paragraph works fine without it. Delete.
Since the industrial revolution, the economy has become an advanced source of dynamic innovations that tend to increase inequality between the upper and lower class. Dynamism refers to the changes in the economy that bring about new methods and techniques of production, which promotes and demotes specific groups in the society. During the industrial age, physical labor stood for a great source of income that promoted the male gender due to their natural strength over females because of their ability to work for longer periods (Muller, 2013). At present, many vocations prefer cognitive abilities over physicality and this change promotes women with a higher emotional and functional intelligence. Introduction of new means of transport also brought about the change in distribution channels of certain commodities. These commodities disadvantaged a certain sector of the community that specialized in old techniques of distribution. This caused the people that were using these old techniques to start finding new ways to get income or rather adapt to the new ways.
The traditional organization also renovated themselves to incorporate a variety of programs such as labor unions and outsourcing of certain duties. At every stage of economic dynamism, a specific group rose with additional wealth while another dropped to the lower class. In this way, the dynamic nature of the economy maintains the shuffle of individuals up and down the economic ladder. The insecurities in the economy refer to the risk of an individual being negative affected by the changes in the techniques of production. Capitalism ensures the formation of distinct winners and losers in the competitive economic field and those at the top control the wealth of the society while the poor tried their best mostly by working for the wealthy in the society, so as to find something to put on the table for their loved ones. Therefore, the favor of the techniques of production determines the distribution of wealth under the elements of capitalism. In capitalist nations, the talented, highly skilled and wealthy families amass most riches of the society during the twenty first century.
Economists attribute the allocation of wealth in the twenty first century to the prevailing opportunities in the world (Piketty, 2014). Globalization facilitates the movement of knowledge and information from one nation to another. The wide access of information to every individual in the world through the internet despite their nationality means that most people have a fair opportunity of gaining wealth. However, instead of closing the inequality gap, globalization is leading to the unequal concentration of power. Power in this case refers to the knowledge of production owned by patent rights of the developed countries and distributed at a cost to the developing nations (Domhoff, 2006). Pharmaceutical innovations, for instance, are owned by few manufacturers that hold the medical formulas for monetary gains as the rest of the world must pay for the medicines. Comment by Author: Are you quoting Krugman or Piketty. You do not have a source for Piketty and there were no readings with him as the author.
The factors of production get their shifting value from the ability of certain nations to set a high price to their exports and commodities. Medicine and machines are some of the most expensive commodities as compared to agricultural products and unprocesses materials. Processing of raw materials to produce a finished commodity also raises the value of an item such that only certain classes of people at the top can afford them. Inequality in the society is sustained by the comparative difference in the value of goods according to the importance set on an item by the people. The value of an item hereby grows higher when a great number of people need and desire it for survival. Therefore, the demand of a substance determines its importance to the society. Comment by Author: While this is true, it has nothing to do with the inequitiable distribution of wealth. Comment by Author: Not a word. Comment by Author: Possession does not change the value of an item. Possession changes the wealth of the individual holding the item. Comment by Author: What does this have to do with inequality.
Redistribution of income among the citizens of a capitalist nation can resolve its inequality. The current capitalist economy promotes a certain group of people into the elite class based on how they utilize the available opportunities. It seems, therefore, possible to increase the rewards of all individuals by an equal margin based on whatever they produce. Formerly, the wealthy upper class secured their position with inheritance of riches and factors of production from a rich parent (Domhoff, 2006). Presently, the diligence of an individual can elevate him appropriately in a manner that closes the inequality gap. Economists argue that poor rewarding of those in the lower class and high rewards for those in the top class contributes to the wealth inequality. Take the example of an organization’s remuneration packages, the managers and directors receive double and triple the amount of salary paid to a department employee in the same company. Comment by Author: You explain how wealth is distributed in capitalism, but you do not give one reason why government should remedy the situation.
The economic growth in the United States and the world at large has been benefiting the top 1% by awarding them the major income earned from production. Even distribution of wealth in an organization to all employees according to their contribution on the production process seems adequate for closing the economic gap. Even distribution of income is, however, difficult due to the factor of merit that will still place some members of staff above others leading to the same inequality. The best solution would be to encourage economic innovation among everyone in an organization, such as the high rates of growth, are met by significant individual effort from every member of society (Krugman, 2014). Capitalism provides a great source of income for the innovative in society since they constantly win in their economic ventures and earn revenue. In the case that every member of society strives innovatively in their own way, then the majority of the community will receive rewards of capitalism.
The innovative approach towards capitalism also requires government interventions to coordinate the distribution of income to those in the lower class of society. The upper class may oppose to the equal distribution of income if it appears like the lower class is receiving undue rewards. The government should offer programs that not only prevent the rich in society from getting richer but policies that lift the poor and prevent them from becoming poorer. An alternative approach to the closing of the inequality gap is necessary in this case. Cushioning the less fortunate from experiencing more poverty through social welfare and life insurance ensures that capitalism continues to function. Human beings are selfish as displayed by the egalitarian nature of the wealthy people who own property and factors of production. In order to eliminate the egalitarian nature in a capitalist economy, the wealthy should understand the need of promoting equality. Comment by Author: You do not address the idea of the previous sentence.
A rising inequality gap continues to increase the risk of sharp differences between the upper and lower classes of society and this might negatively affect a country’s economy. The poor people with no commodities to consume will end up preying on the rich people with more than they need, for them to also survive. Social vices such as crime and prostitution will increase in society as people search for a means of survival (Muller, 2013). When demand for commodities soars higher than supply, people tend to do all they can to acquire the available supply of items. In this case, the low class will be willing to go to all lengths in order to acquire the wealth possessed by the upper class. In conclusion, redistribution of the wealth and factors of production requires the participation of every member of the society in order to achieve equality.
References
Domhoff, G. W. (2006). Who Rules America? Wealth, Income, and Power. Who Rules America: Wealth, Income, and Power? Comment by Author: Not APA.
Hacker, A. (2012). We’re More Unequal Than You Think. Website. Retrieved from http://www.nybooks.com/articles/2012/02/23/were-more-unequal-you-think/?insrc=rel
Krugman, P. (2014). Why we’re in a new gilded age. The New York Review of Books, 8. Comment by Author: Not APA
Muller, J. Z. (2013). Capitalism and inequality: What the right and the left get wrong. Brigeport.edu. Retrieved from http://www1bpt.bridgeport.edu/~jconlin/EssaysMullerCapitalismandInequality.pdf
Your writing has improved, but I do not understand the point of the report. You give an extensive history of capitalism and how inequity is a natural outcome of capitalism, but that should have taken up no more than 180 words. You are not writing a history paper. You are not dealing with the issue of inequitable distribution, more important, the widening wealth gap. You do not even address that. You explain a great deal about why the gap is a natural outcome of capitalism, but that is a given of capitalism as stated in the class. You do not show and address the issue of the widening gap. You do deal with government dealing with it but you do not give a reason why it should. More simply, you need to delete about half of this report and come up with a thesis addressing the widening wealth gap.
Grade: B-. Revise.