The case studies (Nicaragua, Mauritius, Asian Tigers AND Soviet Union) - Essay Example

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Introduction According to Christian (1991), the redistribution project is simply his term for socialism and the growth project is his term for capitalism. He states that both cannot exist, simultaneously, in a society, as each exists on a completely different platform from the other…
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The case studies (Nicaragua, Mauritius, Asian Tigers AND Soviet Union)
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Download file to see previous pages The market is what mediated the exchanges between the capitalists and the proletariat, which were Marx’ terms for the individuals who controlled the wealth and the property-less class, respectively. In the socialistic society, the wealth is more evenly distributed amongst the classes. Everybody has access to everything society has to offer. In the growth project, Marx saw that this type of society relied upon inequality. That is, the best way to make substantial profits is for companies to be more efficient than their rivals. This would mean that the companies who can slash their labour costs would have the edge over companies who could not. This, in turn, exacerbates the income inequality between the capitalists and the proletariat (Christian, 1999). Moreover, the growth project also relies upon mass consumption (Rostow, 1960). In the redistribution project, which is present in a socialist society, there is economic equality, and everybody has equal access to the resources of society. Socialism is seen from the point of view of people who have no property, and the resources are redistributed (Christian, 1999). That said, not every society which is capitalistic is going to experience growth. For instance, according to Frank (1966), Latin America has suffered because it has been participating in the capitalist system for centuries. Their problem is that countries like Chile and Brazil have been treated like satellite developments for richer countries. This paper will examine some regimes who have undertaken redistribution or growth projects, examining if these two concepts can peacefully co-exist. Soviet Union Christian used the example of the Soviet Union to illustrate his thesis that the redistributive project could not exist simultaneously with the growth project. He states that, at least initially, socialism needs a platform, in that socialism cannot exist unless the Soviet economy was already strong. This was because there needed to be material abundance that created the wealth that would be shared, and, also because the state itself had to be strong to ward of outsiders. However, Christian (1999) states that the redistribution project failed in the Soviet Union because there was a basic conflict between the platforms of each vision, that being the redistribution project and the growth project. Competition is necessary to make a market grow, argues Christian (1999), and the Soviet Union was no experiencing this kind of competition. Therefore, in the Perestroika era, there were decentralising reforms in which the government eased its grips on the means of production, which actually led to a collapse of the Soviet economic system. Christian (1999) argues that a capitalist system assumes that the market is a natural institution, which would grow if not stunted by forces which are non-market. On the other hand, the socialist system is not natural. Thus, the growth cannot be realized in a redistributive society, and the Soviet Union is a perfect example of this, according to Christian (1999). In a redistributive society, peasants and landlords, and, by extension, workers and capitalists, would be inefficient. The workers knew that, even if they worked inefficiently, they would get paid the same. The capitalists knew that, no matter how inefficiently they ran their businesses, they were guaranteed income as well. Therefore, there was not the requisite insecurity ...Download file to see next pagesRead More
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