Estimada Laia 8: Capitalism, Communism and Anarchism...what have they get right and wrong?

I did choose to study economics as understanding social systems was clearly one of my early passions, together with philosophy. It did seem the most "responsible" way to study politics, philosophy, business, geography... as it leave many doors open.  After 15 years of that decision, I do not regret  it fully, as I am still passionate by the relevance and the potential to change people lives of the field, but my decision process was very wrong. I hope you (Laia) choose and try something based on passion and interest, not on utility. The world needs specialists that love what they do, not an mediocre workforce that follows labor demand and the hype blindly. But this is a different topic, let me explain you my personal view about the mainstream economic and political views that dominate the world.

Capitalism - the pursue of maximum profit, leading to the fastest  prosperity and inequality growth

Capitalism, and the pursue of maximize short term profits of capital is the dominant system to allocate resources. It created the most prosperous and unequal society in human history, and it is far from clear whether this prosperity is going to last. The multiple crisis of the '29, 73', 2000', 2008'and the 2020' did not break or question enough the system, but rather force its leaders to rephrame it. Long behind are the times of a pure liberal capitalist system, where, under minimum govermental force, each individual was pursuing their own interest and in doing so, together with property rights, improve the productivity and material abundance of the world. The division of labor and specialization, together with the usage of dense and versatile forms of energy explain why our output grow so much.  There is an informational efficiency gain is such a decentralized system, where prices show short term scarcity, or at least the current demand and supply of each and every commodity. The subsequent crisis and increasing inequality force the system to become less liberal and increase regulation, taxation and the role of the state. Even in countries like the USA, the weight of the state in the economic system is almot half of the total economic pie. A pure liberalist state with minimum regulationa and intervention is a matter of theoretical economics, and parties and goverments only question the amount of social, miliatary and infraestructure spending, with little tax reform. While the informational efficiency and democratic nature of such system is clearly a positive thing, it failed to provide equal amount of opportunity, sufficiency safety net for adversity, and protect the commons among populations and generations. The need for reform will be all the more mandatory when inequality, peak everything and climate change make the system unberable for the majority. We are not yet there.

Communism - the oligarchy of political class, extended equality and... poverty

Communism, was the alternative to break with the execise power given to capitalist and the mierable conditions of the working class. Centralizing the economic goals and benefits from work in a theoretically uniform fashion, communism collapse first in democratic terms and later in economic terms. The lack of information from the central goverment, the poor incentives to go the extra mile or innovate, and the extended corruption of the political class make of communism a fairly broken dream. The correct assestment of the missassignment of profits and the excessive remuneration assigned to capital, is not followed by a strong implementation of a sufficiently dynamic and free system that is just and prosperous. Without exeptions communism made, everyone but the political class, equally poor.

Anarchism - all imposed instutions are wrong, let the individual be free and rule!

Both capitalism and communism tend to the concentration of power. The first one in a few companies financing political campaigns and affecting programs, and the latter concentration all power and information gathering in a not so democratic political class. In this context, given the lack of good institutional frameworks that ensure people rights, prosperity but also abuse, anarchism is the ultimate hope. If humans are ultimately good, and we agree on not limiting others freedom by any mean, the maximum decentralization of power to the individual is the proposal of anarchists. Anarchism break the canalization of power into a few by eliminating any instutions, and letting people join or separate from smaller communities. They are right that big goverments and big taxes are ultimately limits to the freedom of choice, as most implemented democracies are too representative and not direct enough, and order will emerge from trust in the nature of our species. While they are correcting pointing to the problem of execisse power concentration and too less freedom, they fail to assess how the commons are to be treated and how to manage violations of freedom that are not as obvious as violence (for example pollution, exploitation....

Do not choose, reform and mixed them all!

Who is right, and who is wrong? I think they are all right in some sense, but all suffer from severe flaws, and hence we should keep working on improving existing and new systems. Let me share what I would change from each:

• From capitalism, I would limit the capacity of firms to finance political parties, as this is the very first source of evil and the creation of the stablishment. Later, I would limit the scale of the economy and its throuput, so we are not breaking natural and resource limits and force us to make a fair just of our limits across generations and regions Last but not least, I would only tax bads such as pollution and products that harm our health, and only finance public investments such as fast train or airports after referendum, with a required 2/3 majority. With a healthy balance of private and public provision, I would ensure affordable if not free education, health and housing for all.
• From communism, I would limit the returns on capital and the labor wage gaps, but do not centralize economic decision making at the micro level, only at the macro level. All economic systems that respect human rights should be respectable and politically available. No economic goal justify a limitation on human rights or the use of violence. I would garantee minimum income for all, unconditional and universal, after a certain period of residence.
• From anarchism, I would create sufficienty decentralized institutions that are responsible to the local choice, but strong enough to ensure human freedoms and the protection of the commons. I would minimize taxes to bads and to finance the basic health, housing and education coverage, but reducing significanty the govermental complexity and size. The only role of the central goverment is to protect humand rights and the commons across generations, nothing else and nothing more.

Probably, they all offer some interesting tweeks to our current system, and we should look at them with curiosity and avoid the preconcieved, mainly missinformed positions, that we should choose a economic and political system, as you choose your football team. 

The most respected approach for me is to be the most critical to your prefereed choice, like Orwell was with socialism, despite his commitment to a more social state. We should not blindly believe in the optimality of capitalism, the justice of communism, or the freedom from anachism.

They will all certainly fail us in some way. To close up:

"Capitalism give us too much of a pie, but does not distribute the pie fairly. Communism reduces inequality, at the price of poverty. Anarchism makes us free, in the permanent conflict of the inequality of rights and obligations. Ultimately, mankind fail us to provide us with freedom, fairness and prosperity at once"