Frankly speaking, there is no completely free market in the world. All governments intervene, the difference is just the degree to which they do so. Even in the United States there are many government regulations designed to limit the things companies can do. The anti-monopoly act is one. Statues protecting consumers are numerous as well, earlier last century many smokers who developed lung cancer sued the cigarette companies and won huge sums of money. If it was really a completely free market, this should not have happened, as nobody forced the smokers to buy cigarettes.

Neither will a completely controlled market work as well. Look at communism and how it has performed economically. China in the 60's and 70's was dirt poor, now they are far better. Look at the difference between North and South Korea, and in the past, between East and West Germany. Communism is just not viable because under it nobody has the incentive to do work. Why work hard when everyone gets the same pay?

The answer is a balance, free enough for people to exercise their creativity to create wealth and to reap the rewards of their hard work, and with enough government controls to protect consumers and small businesses, as well as ensuring fair play. Some social welfare is also vital for the country to develop well, as not everyone is fortunate enough to be born into a well-to-do family.

nice.rider, I do agree with you that Communism is less effective in developing the country's economy compared to Capitalism. However I do not quite agree with the reason you state.

It is not quite true that Communism treats the economy as finite while Capitalism treats it as infinite. Both types of economy need to put in labor, technology and natural resources to get outputs such as crops, manufactured goods and services. With advances in technology and more labor and resources put in, both types of economy will increase in output.

The real difference is that in a capitalist economy, people will have an incentive to work hard and work smart, because by doing so they earn more money. In a communist system, this incentive does not exist because peoples' wages are fixed by the state, without regard of the actual demand of what they produce. So they can laze around or produce lousy goods that no one actually wants to use, so the economy sucks.

In the final analysis, the difference is not one of a finite mindset vs an infinite mindset, but of a lazy mindset vs a motivated mindset.

faceless, I don't consider China's current economic system as Communistic. The only communist element they have right now is that government controlled companies make up a large percentage of their economy, over 50 percent if I am not mistaken. Besides that, their private companies operate in a fairly free-wheeling environment. In fact, because of their nearly non-existent welfare system, I would say that they are in fact less communist (or socialist) than many Western countries, especially the European ones.

faceless, there is a real communist economy. Look at North Korea. In the past China was really communist before Deng Xiao Peng made changes in the 1980's, and look how much better its economy is compared to before then.

Yes, other rewards can be given besides monetary ones. But are they enough? Sure, you can say that we cannot just judge how well an economy performs from a capitalist viewpoint of money. But when people do not have enough to eat and have to queue up for miles to buy the humblest necessities of life, I think that should be unacceptable no matter what viewpoint we use to observe it.

We often talk about greed as being bad in itself. Actually greed is the main driver of human progress.

You want to earn enough money to feed and clothe yourself right? When you achieve this goal, you want to earn enough to buy a house and car right? I don't blame you. So do I.

Now, you may say that this is not greed, but merely desire for the basic necessities of life. The fact remains though, these are still material desires. What we see as basic necessities might be great luxuries to people in Ethopia, and so to them, we are very greedy. The fact is that there is no clear line in the sand as to what is legitimate material desires, and what is overarching greed.

The only thing we can do is to regulate by law so that one person's greed cannot harm another, and that people have to take responsibility for their greed.

In the United States, many huge companies did not do well not because of the greed of the top executives. It was more of a case of disconnection of risk and return. They had the rights to control the company and would collect great rewards if the company did better than projected, but would lose nothing if the company failed. This of course led them to adopt risky financial practices to maximize returns to themselves. IF it was their own capital they were dealing with, I'm sure they would have been more cautious and conservative financially.

In my opinion, the one who DESERVES a billion dollars is not one who works a million times harder than anyone else, but one who makes work easier for a million people.