The Economy — On Socialism and Capitalism

It’s the hybrid that works — neither works on its own.

In May, 1945, my late father gave a lecturre to the Royal Air Force in Bloemfontein, South Africa, explaining that a 100 years hence, there would be a battle between capitalism and socialism.

When I was educated, in the late 50s and through most of the 60s, socialism was not a dirty word. Most first world countries had, what was called, a mixed economy. A mixed economy combined capitalism and socialism, and the world flourished.

I’d like to define terms now. That’s because most people confuse socialism with communism and capitalism with trade. Mankind has been trading for some 12,000 years. Capitalism is about 250 years old. Communism is a political system while socialism is an economic system.

At its heart, an economic system is a system of production and distribution. There are many different economic systems — feudalism, mercantilism, socialism, capitalism, and even a barter system. In all of them, goods are produced, and then they are either distributed by the state, or by the peer of the realm, or through selling (trade), or through donations by charities. Production remains essentially the same — the creations of goods. Methods of distribution differ.

My late father’s predictions in 1945 concerning 2045

We have some twenty years to go before we reach 2045. Even so, when I read my late father’s notes (about 30 years after he…