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It is clear that it would be successful on short term basis but not on long term considering the abuse of economic and political…
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Week 11 In my argument about capitalism, I agree with Ian Bremmer and I think that it is essential to consider the freedom and liberty of markets. It is clear that it would be successful on short term basis but not on long term considering the abuse of economic and political power. State capitalism would lead to unhealthy relationships infested with corruption, crony ideas, and social problems. This is because leaving the control of a country’s economic welfare in the hands individuals with the intension of extending the hold on power and amassing wealth in the process is not advisable. The government has to develop constituents within its establishments that have been in charge of state-owned companies. These branches eventually outlive their usefulness thus a disadvantage to the government because then it would have to do away with them. This means many people will lose their jobs thus blame the government for its shortsightedness (The Economist Debate).
The limitation to state capitalism is that it can only be productive in certain industries as chosen by the government while the rest remain out. However, this depends on the degree of management as well as the level of interference by the state in the operational matters of the industries involved. All in all, the success or failure of state capitalism depends on the state and countries should know their status before indulging themselves or else the economy would be disastrous. In this case, the private sector would suffer a lot as its fundamental liberties would undergo regression. A country such as China is undergoing fast, economic growth thanks to state capitalism. However, its exposure to fluctuations in the purchasing power of other economies makes it unstable and unsustainable.
Works Cited
The Economist Debate. 24 January 2012. Web. 11 November 2012. Read More
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