Must capitalism be reformed

capitalism

The term coined under the production and working conditions of the late 18th century and the beginning of the 19th century for an economic and social order in which private ownership of the means of production (factory halls, machines, systems), the principle of profit maximization and control the economy over the market is typical. Economic and social coexistence in society at that time was largely determined by the interests of the capital owners. In capitalism, ownership of capital is the prerequisite for the power of disposal over the means of production, which includes the right to issue instructions over the labor of dependent employees. Most of the workers are largely without possessions and are economically dependent on the relatively few capital owners.

For Karl Marx (* 1818, † 1883) the way of production in capitalism stands historically between feudalism (economic and social form that is dominated by a noble upper class) and socialism (see there). According to Karl Marx, the total dependence of the workers, who have nothing besides their labor power that they can sell, leads to their exploitation, since the capital owners (capitalists) withhold the surplus value they generate in the production process from the workers in the form of profit from the products sold . The exploitation of the workers, combined with a division of society into capitalists and the dispossessed, as well as the unrestrained laws of capitalism (e.g. ruinous competition, impoverishment of large masses) will ultimately become, according to Karl Marx, the revolutionary uprising of the working class and the elimination of the lead capitalist mode of production. Socialism is thus the higher social system, the inevitable result of capitalist economic and social conditions.

A widespread distinction of capitalism is made into the phases of early capitalism (from about the end of the 16th to the beginning of the 18th century), high capitalism (from the industrial revolution until about 1870) and late capitalism (from about the First World War).

Today, the term capitalism appears colloquially in connection with the western industrialized countries when they are referred to as "capitalist countries". The term capitalism is often equated with the term market economy (see there) and it is assumed that only private ownership of the means of production is characteristic of a capitalist social order. However, private ownership of the means of production is only one characteristic of a modern, market-based economic system. Since the end of the 19th century, the economic systems of the western industrialized countries have been constantly reformed and adapted to the changing economic and social conditions through a large number of social and economic laws. The state always intervenes in the market, if this z. B. seems necessary from a social or competition law point of view. In addition, strong unions ensure that the interests of employees are represented vis-à-vis employers. In the western industrialized countries with a market economy in particular, economic and technical progress has led to considerable social progress and has also ensured that large parts of the population are able to develop solid levels of prosperity.

Looking back, it shows that the social and economic conditions as found by Karl Marx in his time cannot be compared with the current production conditions and a society of today's western industrialized countries that is oriented towards democratic and rule-of-law values. The term capitalism therefore does not correctly describe the market economy system that exists today in the western industrialized countries, since capitalism in its pure form has long been obsolete.

Duden Wirtschaft from A to Z: Basic knowledge for school and study, work and everyday life. 6th edition. Mannheim: Bibliographisches Institut 2016. Licensed edition Bonn: Federal Agency for Civic Education 2016.