İçinde yaşadığımız sistemi gayet anlaşılır biçimde günahı ve sevapları ile anlatan güzel bir yazı.
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Basic Definition : “From each according to his ability, to each according to his capital “
The most ancient example of capitalism is seen in 10th century which is Feudalism which is
considered as the premative form of capitalism. In that time, some land-lords acquire the
whole lands. The farmers and the workers had to work all day long to grow crops but all the
profits went to the land owners pocket. And the poor workers were only given just a little
money or salary to survive only anyhow. Now you can ask how can it become the example of
capitalism? Well, the land was occupied by a landlord who was a private individual and most
of the profit of the land used to go to his pocket.
Capitalism works bit similarly. Suppose, you work in a private company like apple. You work
all day long and get paid. But where does the profit that the company earns go? It goes to
owners account. Obviously there are differences. Today we get workers rights and minimum
wages and are not exploited in most of the cases. Who is the owner of the this company ‘
Apple ‘? The person who holds the most number of shares of the company. Even you can
become the owner of the company through the share market. If you buy a share of it, you
will get a part of it. Because you are also an owner of a portion. We live in such a capitalist
society today. An employee working in the company will get a fixed salary according to his
post, but the profit earned by the company will be distributed among such people who
doesn’t even know the internal day to day working of the company. And who can invest?
Someone who already has money. As I said, “Money make money”. One with more money
can make more money easily by investing in such companies.
Modern capitalism started in 16-17th century in Britain and Netherlands. The first stock
exchange of the world was also Amsterdam stock exchange and the 1st company to be listed
was the Dutch East India company in 1602.
Like there’s Karl Marx for communism, similarly there is Adam Smith known as the father of
capitalism. In 1776 he wrote a book-” The wealth of Nations”. In this book he talked about a
policy -“Laissez-Faire”. It is a french word that literally means ‘leave it’. It means the govt.
shouldn’t interfere in private business. From here the free market capitalism started.
Imagine, if you started a pizza restaurant and another neighbour do the same, then both of
you will try to do something to attract the customer just like quality improving, low price,
discount etc. According to Adam smith, this is the invisible hand of free market. “He is led by
an invisible hand to promote an end which was no part of the Intention”-Adam Smith. In this
case, none is forcing you but the situation. The situation is forcing & motivating you to so to do better than you neighbour. At a certain point, you realize that doing everything by
youself is bit difficult and time killing. It would be better to hire a few people. Then you offer
them difficult tasks like someone would buy products from market, some would prepare
food and some would deliver them. Every person is specializing in specific work. And this
made the productivity & efficiency increase rapidly. This was the major reason for the
success of capitalism accross the world. Division of work and specialization of own sector
was implemented & promoted. By implementing these ideas, industrial revolution began.
Workers had to work hours & hours & the were getting exploited & eventually the
communist ideology started. You may think Karl Marx & Adam Smith were sworn enemies.
But It’s not true. Karl Marx agrees with Adam Smith in some points. He wrote a book named ‘
Das Kapital’ where he agrees that capitalism is helpful for productivity but it would made
workers feel alienated and suppressed. Where Adam was thinking about profit, karl was
thinking about the individuals. The reason is they born in different situations. Adam died in
1790. It was a time when industrial revolution began where Karl grew up seeing workers
getting exploited. If they were from same situation, their opinion would have agreed.
Communism was 1st implemented in Soviet Unions. Where in capitalism, it was 1st
implemented in USA. Three big steel companies of USA merged together to become The US
steel. This was the 1st billion dollar company. In the 1st year it manufactured 2/3 of the total
steel production. But there was still a slight competition in the market. So the chairperson
invited all his competitors in a dinner & suggest them to work together & stop the
competitive pricing. This was how the 1st billion dollar company in the world became a
monopoly. According to Adam Smith, the invisible hand of the free market was supposed to
work & set things right, but the reality is isn’t so pleasant. Whenever there’s monopoly for
any company, it is terrible for consumers. The company misuse this chance & charges extra
sum for their products.
In capitalism, it’s called profit. But Karl Marx called it surplus value in ‘Das Kapital’. A value
where a worker only gets the fixed wage & all the extra profits are taken by the owner even
if it’s overtimed work. There are examples like a farmer only gets a few money but the
trader can earn more by selling it in higher price. But all companies aren’t the same. A few
also try to help the workers. According to Karl Marx this is a system where everyone is trying
to climb a ladder & stop being exploited but as soon as reach at the top, they start exploiting
others. A system where work isn’t rewarded but money is.
In 1929 capitalism received a huge shock when the stock market of USA crashed terribly. The
recession has been a regular feature in capitalism. People were getting unemployed & a
great depression spread. At this point, a revolutionary economist ‘Keynes’ entered who
alerted the history of capitalism. He believe that the invisible hand in free market doesn’t
really exist. In reality it will lead to depression, recession, monopolies. The theory of Keynes
is that the government should interfere & regulate the companies. The small companies
should be subsidized and big companies should be prevented to create monopolies. For many
decades, countries all over the world followed his theory. The next shock to capitalism was
happened in 1980s when Ronald Regan in USA & Margaret Thatcher in UK reintroduced the
free market of Adam Smith to the world. The capitalism implemented in the two countries is known as ‘Neo-Liberalism ‘. The basic is just like the same as Adam Smith sayed. In last 40
years, many countries have implemented this idea specially USA. Because of this,
inequalities have been rising significantly in USA.
-Ahnaf Tahmid ✍
