A Quick Comparison––Capitalism, Socialism And The "Just Third Way"

A QUICK COMPARISON
OF CAPITALISM, SOCIALISM AND THE “JUST THIRD WAY”

Center for Economic and Social Justice, © August 24, 2005 (updated 2010)
 
Capitalism
Socialism
“Just Third Way”
/ Political power accessible to all; economic power concentrated in a wealthy elite / Economic and political power concentrated in a governing elite / Both economic and political power are accessible to all
/ Capital ownership concentrated in a wealthy elite / Capital ownership concentrated in a collective controlled by a bureaucratic elite / Capital ownership is systematically deconcentrated and made directly accessible to every person
/ Capital incomes beyond consumption capacity for a wealthy elite / Adequate and secure incomes from capital for a governing elite / Adequate and secure capital incomes directly accessible to every person
/ Individualistic, atomistic system (ignores or trivializes common good) / Collectivist system (denies economic freedom and sovereignty of individual) / System based on sovereignty of every person, within institutions embodying principles of social justice
/ Institutionalizes greed / Institutionalizes envy / Institutionalizes justice
/ Materialistic ideology and system which ignores the growing income insecurity of non-owning workers facing displacement by technology or lower-paid workers / Materialistic ideology and system based on and fostering the absolute dependency of all citizens on the state for their income security and well-being / Moral philosophy and economic system based on the inherent dignity and sovereignty of each person, which underpins the inalienable right of every person to be a worker and capital owner within a society where spiritual values and the respect for all creation transcend material values
/ Labor-centric, classical laissez-faire economic system (ultimately recognizes that only one factor–labor–produces wealth and creates economic value) / Labor-centric Marxist and Keynesian systems (only one factor–labor–produces wealth and creates economic value) / Kelsonian binary economic system [two interdependent and distinct factors– human (“labor”) and non-human (“capital”)– directly produce wealth and create economic value]
/ Win-lose, zero-sum, scarcity, “dog-eat-dog” orientation / Lose-lose, zero-sum, scarcity, forced-leveling orientation / Win-win, synergistic, post-scarcity orientation (systems and technology are improved to do more with less)
/ Sacrifices justice for efficiency / Sacrifices efficiency for a collectivist version of “justice” / Justice and efficiency go hand-in-hand
/ Wage system (jobs for the many, capital ownership for the few) / Wage system (jobs for all, capital ownership for none) / Ownership system (every citizen and worker a direct capital owner)
/ Equality of opportunity to work; inequality of opportunity to own / Forced duty to work and forced equality of results as determined by governing elite / Equality of opportunity to work; equality of opportunity to own
/ Protects private property rights of the few who own productive wealth, and monopolizes access to future ownership opportunities / Truncates or eliminates rights of private property, putting control over means of production in hands of political elite / Universalizes right to private property and protects rights of property (to extent others are not harmed)
/ “Hands-off” role of the state regarding monopolization of ownership and control; state ends up redistributing wealth and incomes / Economic power is centralized in or regulated by the state; state redistributes incomes / Economic role and power of the state is limited primarily to preventing abuses and monopolies, and dismantling barriers to universal participation in direct capital ownership
/ Prices and wages protected from global competition; promotes mercantilism / Prices and wages controlled by government / Prices, wages and profits set by free and open markets with profits spread among many owners
/ Capital credit available to a few; consumer credit available to the many / All credit controlled by state / Universalized access to capital credit made available through local financial institutions
/ Past savings used to finance future ownership by few / Past savings used to finance future ownership by state / Pure credit, future savings and capital credit insurance used to finance growth linked to future direct ownership opportunities for all
/ Technology controlled by a private sector elite, subject to government oversight / Technology controlled by a non-accountable governing elite / Technology owned and controlled directly or through private sector entities that are accountable to many shareholders and stakeholders
/ “Social safety net” for poor: Trickle-down incomes and social entitlements provided through government transfers of income, institutional charity and personal charity / “Social safety net” for poor: Trickle-down incomes and social entitlements provided through state monopolies, forced redistribution of wealth and income by government / “Social safety net” for poor: Directly connects poor individuals and families to growth dividends, supplemented by personal charity, institutional charity, and government transfers
/ Indifference to environmental degradation; economically powerless become victims of development and environmental hazards; the well-being of future generations is sacrificed for short-term profits / Economic inefficiencies lead to inability to finance the most advanced and environmentally sustainable technology; economically powerless become victims of development and environmental hazards / Anticipatory approach to sustainable growth and development internalizes externalities, assigning environmental costs to polluters and passing costs on to consumers; offers means of financing most advanced “green” technologies; economically empowers people directly through private property to protect themselves against environmental hazards; and plans for future generations
/ Purpose of education is to train people to get jobs / Purpose of education is to train people to get jobs / Purpose of education is to teach people how to become life-long learners and virtuous human beings, with the capacity to adapt to change, to become masters of technology and builders of civilization through their “leisure work”, and to pursue the highest spiritual values.