Global Capitalism as the Cause of World Hunger - Essay Example

Global Capitalism: It is imperative that one understands the meaning of the terms before looking into the whole term, capitalism is basically an economic system in which the ownership of the means of production is primarily made and maintained by the private individuals or corporations, where as the word global refers to the universalism of capitalism, capitalism has been an ideology which has spread through out the world because of what it propagates, first of all it is important to understand that capitalism grew because of the failure and lack of alternatives to the ideology. Communism is the only alternative that had been in place before capitalism was, communism basically refers to an economic system where the state had total control over the means of production and also the distribution of goods, the state determined how much of each good would be produced and for whom. Basically an economic system aims to answer 3 questions i.e. what to produce, whom to produce and how to produce, in communist states these questions were tackled by the state where the government formed certain bodies for each industry and these bodies would conduct a thorough research to determine the answers to the three economic questions, this kind of an economic system ensured that every one would get an equal share of the goods produced and there would be parity in the levels of income for the whole population. The thing that was lacking in this form of a system was that it did not cater to growth, people who were willing to work harder than the others did not get a reward for the work they would do and hence there was no place for individualism in this economic system, this was indeed a major draw back of communism because people did not want to cater for the whole society they wanted personal benefit which was almost impossible to gain from this economic system. The assumption of communism that people are usually good and want others to benefit was not an appropriate one because people are generally selfish and want to flourish as individuals rather than every one having the same rights and income. Another draw back of this system was that it was costly to determine the prices of goods in the market because there were committees formed to determine the prices and this was not an effective method because these committees did not work for free and hence there was an extra cost that had to be paid in this system, therefore the prices of the goods were pushed up to cater to the expenses attached with the committees set up in this type of an economic system. What capitalism did was to liberate societies of this system, it catered to needs on the individual level, the answer to the three economic questions was ‘ to who ever could afford it’ although this might sound pretty selfish but the capitalistic system provided means and methods for people to afford all the goods that they wanted to provided that they worked for it, another plus point of this system was that there were no committees that had to be dealt with on the cost front, prices in such a system are determined by the demand and supply mechanism which is basically a cost effective method of determining prices albeit one where prices could vary by a great deal. The supply and demand method was described by Adam Smith as the guiding hand where peoples interest guided them to demand and supply things as and when they wished to, the capitalistic system has been the foundation of modern day economics and has produced people like Bill Gates who have been able to work their way to building huge fortunes while working with in the system, but with in the same system there also exist people who live below the poverty line and have virtually nothing to eat and drink and this is the most major draw back of this type of an economic system. It was the monotonous nature of the communist system which gave birth to the capitalistic system and the capitalistic system has in return laid the foundation for a new world economic order. Capitalism-Responsible for Hunger? Consider some statistics- 70% of the worlds wealth lies with the western states, these states have been able to dominate the world through their capitalistic structure, the rest of the world has been quite slow in catching up and hence the centre for capitalism is the west where as the rest of the world specially the Asian states can be described as the peripheries of the capitalist structure, this description has been given by George Soros in his book ‘The Crisis of Global Capitalism’. The main danger facing the world at this point in time is that most of the wealth flows from the centre to the peripheries and back to the centre, there is no known way by which the peripheries can actually plug this leakage from their economies. Add to this the new world order brought about by the ‘Free Trade’ concept brought about by the WTO, the free trade agreement to which most countries must comply, this free trade ordinance removes any synthetic barriers that any state would raise in order to protect their industry, the logic behind this concept is that is by removing barriers the industries will automatically have to be really very efficient in order to survive because there would not be any barriers to protect them but in reality this does not happen because industries are not inefficient by choice there are some problems that they face that makes them inefficient and there is no way that this inefficiency could be over come by implementing this policy because the problems that hinder the efficiency of some of these industries would still persist, this would definitely result in the shutting down of some of the industries, specially in the third world countries where industries are already weak and poverty level is on the rise, this would only increase the suffering of those who are already below the poverty line. The problem with capitalism is that it is the survival of the fittest and those who are not fit enough are not sidelined but are pushed towards hunger and death which is a very serious issue and a growing cause of the increasing poverty and deaths due to the same reason. There is a problem of balance, between the rich and the poor and also who would get what share of the economic earnings and the greater problem is that capitalism does not recognize this as a problem, it realizes the fact that there would always be people who would be sidelined and it is not a major cause of concern because capitalism believes that these people have been side lined not because there was a lack of opportunity but because these people did not grab the opportunities that were presented to them and as a result have to suffer economically. Keeping in mind all the arguments presented capitalism definitely is a cause of concern and cause of poverty amongst the populace of the world but it is extremely important to remember that it is not the only cause of concern, some of the policies undertaken by states are implemented incorrectly which result in growing poverty and hunger and hence it cannot be stated that capitalism is the ONE and ONLY cause of increase in hunger amongst the worlds populace. Conclusion: The points that have been raised in the discussion above are a major cause of concern for states that follow the capitalistic economic system, capitalism has become a global phenomenon specially after the failure of failure of some major states that followed the communism economic system, specially the failure and disintegration of the USSR in the early 90’s contributed in a large way to the promotion of capitalism but there is a very important point that has been missed out altogether. What works for me does not necessarily work for some one else, one mans meat is another mans poison i.e. capitalism has been accepted by almost every nation on the face of this world because some countries have been very successful by implementing this method, this perception and thought process is totally incorrect altogether because every nation is different just as human beings differ on an individual basis, so do nations, they do not have the same characteristics, then how is it possible that every state would be able to achieve a utopian state by implementing the same economic system? This is a major question that needs to be asked first of all, though it might take time to answer this question by developing another economic system but it is extremely important that this question be raised. Of course every state implements capitalism to various degrees but even then the principles remain the same, the playing grounds remain the same, there might be a case for having different economic systems in place at various stages of growth. References: 1. robbins, richards. global problems and culture of capitalism . 3rd. 2007. 2. Hart, Stuart. Capitalism at cross roads. 2005. Read More