During childhood, the concept that was difficult for me to digest was the cold war. A war without weapons but with ideologies is difficult to understand. Initially I thought it is an indirect war between a business owner and his employee, when two nations supported their emotions. Only after growing up, I realized that it is more than the petty politics between business owner and his employee. The rift between economic growth and economic welfare is drastic. Sometimes we have to compromise between these two core concepts to derive the desired goal. That means economic growth is compromised for economic welfare and vice versa. Having said this, it is important to remind us that the socialistic movement liberated humans from shackles of slavery.
If socialism all about the betterment of labour, then why some capitalistic countries have better labour reforms and wages than socialistic countries. Some might argue that it is not the goodness of capitalism but most of the capitalistic countries embraced an older cousin of socialism called “democracy”. Today democratic socialism inspires the economic policies of many countries. From ancient Greece to modern era democracy fascinated and influenced humanity. Slavery was very prevalent in ancient Greece and it remind us that democracy as a philosophy failed to address the reforms of working class in its budding stage. Only the during the period of industrial revolution, we understood the importance of socialism. Hence the spontaneous change of labour reforms and wages in capitalistic countries happened with the miracle of increase in per-captia income even though democratic sentiments supported such initiatives.
It is interesting to note that, USA the mecca of capitalism had produced more number of self made millionaires. The socialistic countries failed to identify the human tendency to desire and thrive, and it happens through entrepreneurship. Socialism failed to address Maslow’s Hierarchy of needs to great extend and it caused disinterest in socialism when a labourer aspired to enter into the shoe of entrepreneur. This reminds that the mix of capitalistic and socialistic reforms is that the economy needed for the betterment of people. Therefore capitalism and socialism are not opposite sides but two sides of same coin that strive its best to bring an optimal composition of economic growth and economic welfare.