which one is better capitalist or socialism ?

           Before deciding to join capitalism or not, first we must  know what capitalism really means and the advantages and disadvantages of the capitalist system. According to Wikipedia capitalism is an economic system based on private ownership of the means of production and their operations for profit. One of the advantages of a capitalist country compared to other economic systems is that it is able to create competitiveness and creative power so as to create new innovations to continue gain benefit from the market, while the drawback is because the government cannot intervene directly in economic activities so sometimes the distribution of goods is not evenly distributed in each region. 

            After understanding the meaning of capitalism we must also know what socialism is and the advantages and disadvantages of the socialism system. As we know socialism is a system that is contrary to capitalism because it is fully centralized and regulated by the government. According to Wikipedia socialism is a self-managed and decentralized economic system based on independent self-regulating economic units and decentralized resource allocation and decision-making mechanisms. But like capitalism, socialism also has various advantages and disadvantages. The advantage of this system is that it has a high level of efficiency in economic activity and the liberation of a country from monopolistic practices normally found in capitalist society. This is because production facilities are regulated and controlled by state planning authorities to achieve the right economic targets. The weakness of this system is the absence of political freedom and the absence of economic competition. As a result, the spirit of democracy dies and the level of creativity of producers becomes low and the creativity of product innovation also decreases. So, products tend to be monotonous and not developing. 

             After knowing the capitalist and socialist economic system, now we must know about the third division of the world. The third division of the world began after the second world war, that time was the beginning of a cold war caused by differences in ideology and economic systems. The first world is a country that is a member of NATO and capitalists, such as America, Britain, Germany and Japan. While the second world is a country that is a member of the Warsawa Pact such as Bulgaria, Romania, Hungary and Poland. Then the third world is a country that does not belong to the Warsaw Pact and Nato members such as the former colonial colonies in Africa and some countries in Asia that have low economic levels such as Indonesia. But after the collapse of the Soviet Union in 1991, the third division of the world was no longer based on ideology but based on the level of economic growth or GDP.

              If anyone asks me "what will you do to face the challenges of the third world to join or not join capitalism" of course I will say "yes I will join" because the economic growth of the capitalist country is far more developed than the state of socialism. But I will not fully adapt the capitalist economic system, I will combine it with a socialist economic system or more precisely adapt a mixed economic system. The mixed economic system is an economic system which on the one hand gives the government the freedom to try economic activities, but on the other hand the government has intervened in the economy with the aim of avoiding full control of a group of people on economic resources, which often happens in capitalist countries. 

              I think this mixed economic system is the most suitable for countries in the third world. The proof is that China is the second highest economy after the United States. After implementing this economic system, China made it through the economic crisis, even its economic growth increased rapidly by about 10% every year, even the United States, which ranks first, is overwhelmed by China. But just like the other two economic systems, the mixed economic system also has advantages and disadvantages. The advantage of a mixed economic system is that the economic sector controlled by the government is directed to the interests of the community, besides that the Government has the power to regulate the market and take action against miss use of monopoly power, such as preventing excessive price increases. The disadvantage is that the Government burden is heavier than the private sector and the more profitable production sector is managed by the government so that the private sector is less able to maximize profits in its business activities.

             In my opinion if I implement this economic system in a country that I form, (eg: I have my own developing country or third world country) the economy in my country will run more stable with a significant growth rate, but if the exploitation of natural resources is done excessively in order to maximize profits without supervision, my country may only experience these profits a few years after that, maybe my country returned to being a poor country due to the excessive exploitation of natural resources. If we want to bequeath a country whose economy is better than now, we must teach the next generation to use all the resources as well as possible for the benefit of the country in the future. Most developed countries can succeed because they maximize the use of natural resources and human resources in all sectors.

by Richie XIIA 4/19