4 C's Od Capitalism

Econ paper

Exam II

Capitalism can be defined as a system in which one group owns the means of production and another groups is coerced into working for that first group. That basically means that one group of people own the land / machines / materials to produce a good. But that good is not magically going to materialize all by itself. Someone has to do that work. Be it programming a computer to do specific things, assembling a piece of a car, or selling a product that is made. By doing this we find that capitalism is not what goods are produced, but how it produces those goods. In this we have the 4 c's. They are Conflict, Context, Change, and Collective Behavior.

Context deals with the situation in which you are in affects your behavior. Context just doesn't deal with the economy, but in real world situations. And these solutions are derived from tradition, history, and morals and values. Collective behavior is an action that is taken because of a group affiliation. Gaining control of wealth and resources and mainly power cannot be done with an individual. This can only be done with a group. A group that has a vested interest or relationship. Sometimes this is as simple as race, religion or socioeconomic status. This basically means that what you buy and where you work can be greatly influenced by your relationships with other people. Change can be derived from the conflict of basic things. Things like a tax rate. The super rich would like a cap on how much taxes can be collected. The middle class would like the tax rate reduced. These conflicts cannot go away because there are so many people and they all have the right to have their own opinions on how their money will be spent. Through this constant change can be a different tax level for different salaries. Also, the money collected will never stay in one spot. Meaning that for x amount of years 25% goes to the military, perhaps 5 years later people vote on 30% of federal funds will go to the military. These conflicting interests being about change. Collective behavior means that for one group to gain, another group must lose. Workers want a high wage. The capitalist wants to pay the lowest wage to keep the worker at the job. For the workers to gain a higher wage, the capitalist will lose profits. And a key to this is not letting the "other team" know what is going on. This can be seen in labor disputes like in a strike. Neither side wants the other side to know what they really want until they are both sitting down and bargaining. Weakness does not want to be shown because then their group loses and the other group gains.

The main goal in a capitalist society and economy is to maximize the profits. Then the company must think of what to do with the profits. They can re-invest, pay out dividends, pay debt, or pay high wages. A company can re-invest in order to grow. They must grow to survive. And that growth requires profits. The auto industry for example has been losing huge amounts of money, so they will invest in technologies