The Instigator
qwzx
Pro (for)
Tied
0 Points
The Contender
Youraverageunicorn
Con (against)
Tied
0 Points

Free Market Capitalism (Pro) vs Mixed Economy(Con)

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Post Voting Period
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Voting Style: Open Point System: 7 Point
Started: 9/13/2017 Category: Economics
Updated: 9 months ago Status: Post Voting Period
Viewed: 1,652 times Debate No: 103690
Debate Rounds (4)
Comments (7)
Votes (0)

 

qwzx

Pro

This round is acceptance.
Round 2 will be arguments
Round 3 will be rebuttals
Round 4 will be addressing opponent's rebhuttals and concluding statements

Good luck and hope you accept this challenge

Free Market Capitalism: A free market is a system in which the prices for goods and services are determined by the open market and consumers, in which the laws and forces of supply and demand are free from any intervention by a government, price-setting monopoly, or other authority. An example would include Switzerland

Mixed Economy: An economic system in which the government imposes boundaries on capitalism to limit the concentration of power and achieve social balance. The U.S. economic system is a mixed economy.
Youraverageunicorn

Con

Sorry if it took me a while to respond. Yes, I accept.
Debate Round No. 1
qwzx

Pro

I would like to take this time to thank my opponent for accepting the debate and look forward to some respectful and productive political discussion.

My premise lies on the principles of morality and efficiency. It is worth noting that throughout history, governments that attempt to impose/control the market tend to fare worse than more capitalist countries. We see a clear correlation between a country"s HDI and a country"s economic freedom.
[http://www.heritage.org..., http://www.nationsonline.org...]

I will argue on the premise of morality using the concept of individualism. Through the viewpoints of individualism, this means that people should be regarded not as faceless masses but individuals. In free market capitalism, individuals that produce more for the society (businesses create products and jobs) are rewarded with more money. Individuals that are willing to take a higher risk gets a higher reward. This encourages rapid business growth and creates a sense of emulation among businesses. This results in a decrease in price and an increase in quality for consumers.

However, this does inevitably leads to wealth inequality but, then so what? Wealth inequality is not an inherent problem. For example, let's imagine a scenario where you and I are standing together in a room. I have 1 dollar in my pocket while, you have 6 dollars in yours. Just because you have more money than me, does not mean that you have stolen money from me. Perhaps it is because you have a job and I don"t. Maybe, you were supposed to have 7 dollars and I actually stole 1 dollar from you! The point is that the homeless aren"t poor because of Bill Gates.

Another advantage of "free market capitalism is that it is impossible to discriminate against certain ethnic groups, religions, etc. Businesses only care about 1 color and that is green. Profit is what businesses care about and this results in little room for intolerance. In order to maximize profit, people with the highest productivity and merit get the job. If a business owner rejects a high skilled laborer on the basis of skin color then, he loses a valuable resource which leads to him losing against his competitors. Likewise, if the business refuses to sell a product/service to a customer on the basis on skin color then, they would lose a potential customer leading to a decrease in profit which results in them losing to their competitors. This is why Jim Crow laws were forced to be implemented and wasn"t just a "cultural thing". Southern businesses despite being racists would still serve African American customers.

We have also seen a trend in Europe in which more laissez faire economic policies are taking place. There is a gradual shift to "right-wing" economics in recent years in most of Western Europe. Notable examples include the UK, Germany and France.

[http://econintersect.com...]

The two main reasons why Europe is voting more right wing leaders (particularly in economics and immigration) is very simple. The refugee crisis and the economic downturn due to leftist economic policies. It is worth noting that the government with increased intervention in the economy tend to fare much worse. Bolivia and Venezuela are both examples of this failure compared to more capitalist Chile. A nation"s prosperity depends less on resource production but resource allocation. The free market always allocates resources in the most efficient way and controlled/mixed economies simply can"t keep up.
Youraverageunicorn

Con

Thank you for challenging me and I look forward to this debate.

I want to start my argument off by saying there are advantages to mixed economy.

With mixed economy, it allows private participation which in return allows a healthy competition and that results in profit. It also contributes to public ownership in manufacturing which also contributed to welfare needs. This is what keeps our society going. The system may be a little harder for some people to pay but it"s for the best. I would like to say that it"s for the best because aside from this we are trying to help those in need but Free Market Capitalism doesn"t solve that for the following:

Imagine I"m selling muffins. Mine are for 50 cents each. And then imagine there"s a boy next to me selling muffins for five dollars each. I"m guessing people would come over to me. But what makes them 1 dollar? It probably costs 50 cents because I used ingredients that are easy to get and do not cost much, which results in unhealthy products that would be worse for the health of people who are struggling. In maybe a more extreme case, I could"ve poisoned the muffins. Although that may or may not happen, the ingredients are sure at a very high risk of bad for your body. With mixed economy, more boundaries are enforced, strengthening the safety of consumers.

Like I said before, healthy competition results in profit so those with good jobs will have a stable life in terms of pay. Saying the products will be easier for people to get won"t matter. There"s always going to be financial problems in our world. It"s not that I don"t want to fix it we just have to be focused on giving all people the best as much as we can.

Also with boundaries this can reduce pollution which causes global warming. Capitalism causes global warming because free trade like I said can produce unhealthy products. Those products may require factories and factories cause a part of global warming. With these boundaries and the best we can offer, mixed economy cuts down unhealthy products like that.

I look forward to your response
Debate Round No. 2
qwzx

Pro

The problem with allowing the government is that in the economy is that most services can either have quality, affordability, or universality. In the economy, you can only choose two of these three traits. If quality is prioritized than prices will go up which will either result in a reduction of universality or affordability.

The Affordable Care Act is a result of a mixed governmental planning and private enterprise. We see that market forces are simply incompatible with governmental planning. We see an increase in universality but a massive decrease in affordability and quality. Since it demands universality, it becomes more affordable for lower classes but becomes unaffordable for the middle and upper classes. This results in less revenue going into our healthcare system. (Majority of people in America are middle class) This in turn decreases pay and discourages people to pursue the long and expensive education and training to become doctors. As this happens, it results in higher prices which will eventually be raised on the lower classes. At the end, these mixed economic policies often hurt the ones they wish to help.

These problems however, are not present in free market economies. Since it allows businesses to compete with each other, it will result in an overall price reduction and increase in quality. Competition has led to almost every single improvement in society. Pensions, employer provided health care and the concept of retirement was created by private businesses to attract more workers. Phones, electricity, automobiles and the internet were created by the private sector NOT by the government.

My opponent argues that free market capitalism enables unsafe products which can hurt customer"s well being. I have a simple response to this predicament that unicorn here has presented. How can a mixed economy prevent this? Who will be chosen to determine what is considered "unsafe"? What will be the guidelines to decide what is unsafe? Should the government shutdown fast food restaurants? Should the government make all inorganic foods illegal? While Mcdonalds is unhealthy, it is often the most convenient and affordable for the poor. In our crusade to ensure better health for the poor, are we willing to starve them? There is a reason why minimum wage workers are not shopping at Whole Foods. I believe that making the poor more healthy is a good thing but, at what expense?

The Free Market response is that eventually, that all successful businesses will grow and prosper. This will result in either an increase in job opportunities or an increase in wages. Eventually more poor people will get richer and will no longer rely on low quality products and services. Albeit it is not immediate but it does work. It is worth noting that the most capitalist countries in the world also have the greatest income mobility. Examples include Chile vs the rest of South America.

Also to claim that Free Market Capitalism encourages pollution is borderline absurd. We see many companies that adopt green energy policies regardless of governmental legislation. If the customers cares about green environmental policies then, it is in the company"s best interest to adopt green energy policies in order to attract more customers. The problem with government forcing legislation on businesses is that it results a decrease in profit. The sad truth is that most businesses that the government targets with these policies employ mostly lower class workers. These policies have resulted in a decrease in job employment options for the lower class which hurts the people that you wish to help the most. The Paris Climate Agreement cost the USA billions of dollars and countless amounts of jobs. Free Market Capitalism is the best solution.
Youraverageunicorn

Con

Free market capitalism is a bit more chaotic than mixed economy.

We can find someway to give the economy what they need but if we"re in a society where our system has a decrease in boundaries, who knows what could happen.

It wouldn't matter because we could be giving our society the wrong things for their bodies and then price WOULD matter since we"re giving such bad food.

Another things that"s bad for the society"s health is that our history is filled with dishonest business, and now trust is scarce. Businesses polluted before pollution controls were established, businesses marketed addictive products such as tobacco, before regulations, businesses could"ve tested their products prior to FDA rules, businesses could have regulated themselves so there wasn't a vast financial crisis in 2008, businesses are carrying out harmful practices to society, but if all of this didn"t happen, maybe we could"ve talked about if government regulations were necessary. But it did happen and there"s nothing we can do to change that.

Affording may be hard at times but I think a majority would risk a chance of that over risking [extremely] the consumption of harmful products. People would find a way to get back up on their feet faster than our society being in jeopardy for their health and their life.

You stated something about higher profit but that"s what I also stated. Of course, without the health problems.
Healthy competition will raise finance because it pushes you to be more creative so people will buy your products.

You say that free market is more affordable for the poor. That may be. But I can assure you it"s not healthy for them. Of course we aren"t going to STARVE them. There are people trying to help this problem and that"s why we have donations and organizations. The free market will only jeopardize their living even more. With the chance of "poisoning" yourself from unhealthy products in free market, they will surely make you suffer even more than you already do which is why we need to help the poor regardless of our system. It"s bad either way.

Capitalism DOES cause pollution. I stated before people carried out with pollution in their companies, before regulations were noted. Mixed economy fixes that because of it"s boundaries. Didn"t you catch that?

It"s very difficult to change government policies and It"s extremely difficult for the average citizen to influence corporate policies using only consumer purchases and stockholder meetings. And that"s why we have government regulation.
Debate Round No. 3
qwzx

Pro

In my opponent"s arguments, he/she states that a Free market capitalism is more chaotic and that it would essentially devolve into anarchy. However, this is quite far from the truth, there is a clear correlation between a nation"s economic freedoms and the nations HDI. A free market capitalist society is not anarchy and is applicable to the real world. "The Swiss Confederation is one of the most economically free nation (#4). It has a peaceful society with a low crime rate and little if any pollution and has an HDI rank of 2.

My opponent bring up the fact that there are dishonest businesses in our history and I don't dispute this fact. However, this is not a condemnation of free market capitalism. There were times when the corporations were corrupt and would bribe government officials to pass certain laws in their advantage. If you are however, to examine this time in history, all these unacceptable business practices were not done in the absence of government.

The United Fruit Company committed atrocities throughout their history. They were supported by the American government. The United Fruit Company finally experienced the greatest amounts of reform not because of governmental regulations but because of the public outrage. Businesses aren't a force of good or evil.

They are motivated by profit and the sad truth is that every single instance of their atrocities was due to the support and encouragement by governments. The East India Company terrorized the Indian subcontinent and ruled it with an iron fist through the backing of the British government. The state can"t be trusted to uphold morality and therefore should not be trusted to legislate their brand of morality on businesses.

My opponent has flat out ignored my points on the social, economic, political consequences on the regulation on "unhealthy" products. He has not addressed on what constitutes healthy vs unhealthy products. He has not addressed on the fact that affordability of goods leads to increased spending which eventually leads to an increased amount of jobs which pull people out of poverty.

Ironically enough, my own opponent debunks the overall premise of his argument: "There are people trying to help this problem and that"s why we have donations and organizations.". My opponent has just admitted that there are organizations and people that are willing to help the poor. Free Market Capitalism is not against charity by individuals and organizations. There is no need for government to legislate the market to attempt to help (and often fail at) the poor. A grand example of failed governmental policies include the war on poverty. This war on poverty was started on January 8, 1964. The war has cost the USA an estimated cost of $22 trillion dollars. The result of this grand expedition"..an increased crime rate and an increase in children born out of wedlock. I personally believe that charities can replace the welfare state and I quote youraverageunicorn: "There are people trying to help this problem".

My opponent then bring up one of the most popular myths about free market capitalism. The truth is that the absence of government regulation was NOT what caused the 2008 recession. Yes, it was the result of poor financial investment which caused the housing bubble to pop. However, if this is the fault of market forces then, why don't we see constant recessions and no recoveries in our economies? The cause of the 2008 recession can be traced back to the Glass Steagall Act which allowed the government to bail out businesses in case they made a poor financial decision. This Act was a product of a mixed economy. The problem is that it allowed businesses to not worry about taking unnecessary risks. They knew that the government could easily bail them out if they fail. The government simply don"t have enough money however, to prop up all these businesses if they fail. The 2008 recession was a result of too many businesses taking advantage of the bailouts. The free market did not cause this recession but governmental legislation in our mixed economy.

My opponent once again tries to link the free market with pollution. Yes, free market capitalist countries do release a certain amount of pollution. However, correlation does not mean causation. All nations release pollutants regardless of their economic policies. Name me one developed country without any pollution in their environment. Also, just because the government issues stricter environmental laws doesn"t mean that it will curb pollution. China, Russia, India and the USA has a relatively large governmental presence in their economies. These four countries also contribute the most pollution in our air and water.

If there is a direct causation between pollution and governmental control over the economy then, Switzerland would be a barren wasteland and China would be an environmental utopia. It isn"t about Capitalism but energy usage and more capitalist nations have a higher standard of life which includes the access to electricity. As long as there is electricity in a developed nation, they will always create large amounts of pollutants. Correlation doesn't equate causation.

My opponent then makes the claim that it is extremely difficult for the average city to influence corporate policies but the same could be said for political process as well. Each individual vote in an election is theoretically meaningless however, if there is enough support then it will always result in a change of some kind. Influencing the government and corporations are hard to do but they are not impossible. There are methods that can solve our broken system. As evidenced in my points involving imperialism, colonization, economic recessions: Government is the problem, not the solution.
Youraverageunicorn

Con

Your example of the Swiss Confederation, I understand. But what about free market being held in the United States. It's already been chaos this past year and we have been dealing with a lot of stuff. The boundaries that would be held in mixed economy is quite necessary these times around and don't think getting rid of them would be much help.

My cases on healthy products are based on things like organic food. Unhealthy products are things that are easy to get because it didn't take much to make them. Things that are easy to get like, soda, processed meat, even cheese. Things that you could get at a convenient store.

Affordability to goods may or may not lead to increase in jobs that pull people out of poverty, but this is a situation based on time frame. How long is this exactly going to take? And I already talked about how cheap products are cheap for a reason. We have a problem with obesity in the United States, and we have unhealthy eating habits that CAN lead to death. Are you sure you want to make that problem worse until eventually all of us are in good shape? The world will never be perfect. But if you're just going to encourage certain problems with an extremely low chance of meeting your goal, it's just going to make it worse. I told you. Healthy competition leads to profit and that's a much better use of your time than the first alternative. Sure, free market can give wealth and everyone can get rich and whatever [eventually] but that means anyone who is rich today and has a big company today must ave done that by serving consumers. The flaw should be pretty obvious in this argument.

I did not contradict myself using the donation and organization argument. I'm saying regardless, we have problems with poverty. But unhealthy products in this use will just build on another problem. Plus, regardless of people's wealth, usually people would like to get the cheapest alternative so even if we are out of poverty, we will still have unhealthy eating habits. There are many problems with free market, there are some good reasons too, but the pros outweigh the cons.

I'm aware that pollution is caused by all countries but that doesn't mean contributing to it will make it any better. What I mean is these regulations are important because people broke certain boundaries before regulations were enforced which means getting rid of them will get us back to where we started. Maybe the boundaries don't fix everything but it sure does help. We've come a long way with certain problems and some are because of regulations we enforced. So you can bring up good things about free market but it's nothing compared to the problems caused.
Debate Round No. 4
7 comments have been posted on this debate. Showing 1 through 7 records.
Posted by Youraverageunicorn 9 months ago
Youraverageunicorn
I understand that we are in a mixed economy.
Posted by Youraverageunicorn 9 months ago
Youraverageunicorn
No, sorry. I understood that. Sorry I made it sound like that.
Posted by qwzx 9 months ago
qwzx
Round 1

Mixed Economy: An economic system in which the government imposes boundaries on capitalism to limit the concentration of power and achieve social balance. The U.S. economic system is a mixed economy.

You do understand that the current US economic system is a mixed economy right?
Posted by Youraverageunicorn 9 months ago
Youraverageunicorn
haha thanks
Posted by qwzx 9 months ago
qwzx
Good debate.
Posted by Youraverageunicorn 10 months ago
Youraverageunicorn
sorry, what the heck my keyboard is broken so I cannot use apostrophes.
Posted by qwzx 10 months ago
qwzx
Good Luck on the next round!
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