Saturday, October 8, 2011

3 Defects of Communism

Posted by Benjamin Atuma at 5:30 AM

A number of defects are noteworthy in a communist economy. 

1.   Problem of Unmatched Supply:  Because the decision as to what will be produced is not based on the market mechanism, communist government has no way of knowing what to produce.  This situation leads to unmatched supply and demand. 

2.   Too Much Emphasis on Capital Goals:    Communist countries promote national goals which might not reflect the wishes and aspirations of the larger populations.  For example, most communist economies typically emphasize capital equipment and military hardware as opposed to basic commodities such as food and clothing that touch on the lives of the ordinary citizens.  This way, there is the likelihood of short supply of consumer goods, and attendant poverty.

3.   Near Absence of Incentives for Hard Work: The workings of this economic system (communism) do not inspire hard work among the working class because the government takes most of the earnings.
So far, communism and capitalism have been examined as the two major economic systems on the opposite extremes of a continuum.  The third basic economic system, socialism, combines elements of capitalism and communism.

If you liked this blog, you might like this Defects of Socialism.

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Benjamin Atuma
I am a writer, teacher, web consultant, and an entrepreneur.  Enjoy blogging, business networking, traveling, and preaching the Gospel of Jesus.

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