Before we can decide which is better, let’s start with some definitions.
What is Socialism?
What is Capitalism?
Capitalism is an economic and social system in which capital is privately controlled and labor, goods and capital are traded in markets and profits distributed to owners or investors who take risks to produce goods and services. Under capitalism, individuals are allowed to run their own businesses in such a way that they create wealth for themselves and their families. Usually, the level of self-motivation, creativity and persistence restricts how wealthy a person will become.
What does the Bible say about these systems?
While the Bible does not advocate one political or economic system over another, it does describe the virtues and the depravity of human nature. Some people naively believe that all people are good. The Bible in Jeremiah 17:9 says, “The heart is deceitful above all things, and desperately wicked: who can know it?” Christianity starts with the proposition that all people are sinful and self-serving at heart and that only through a transformation of the heart through Jesus Christ can one become good. “This is the message which we have heard from Him (Jesus) and declare to you that God is light and in Him is no darkness at all. If we say we have fellowship with Him, and walk in darkness, we lie and do not practice the truth. But if we walk in the light as He is in the light, we have fellowship with one another, and the blood of Jesus Christ His Son cleanses us from all sin. If we say that we have not sin, we deceive ourselves, and the truth is not in us. If we confess our sins, He is faithful and just to forgive us our sins and to cleanse us from all unrighteousness. If we say that we have not sinned, we make him a liar, and the His word is not in us. (I John 1:5-10 (NKJ).” Why is man’s sinfulness essential to this topic? If man is sinful, then we cannot reasonably expect any system under a ruling class of corrupt people to make decisions that are in the best interest of the whole. Because human beings by nature are self-centered, self-seeking and selfish, those in authority often use their influence to support themselves and their friends at the expense of others.
In a socialist system, the government or ruling class is responsible for providing food, clothing, shelter and a job to all the people and for overseeing the equal distribution of society’s goods. If human beings were basically, good socialism might work. The fatal flaw in socialism is the sinful nature of humanity itself and the inability of those in power to rule unselfishly.
In a capitalist system, it is understood that people will naturally do what is in their best interest. The purpose of government is to provide a structure where the freedom to pursue one’s best interest is encouraged within defined limits. The limits are set to protect one person from another person’s sinfulness or desire to take advantage of others.
What about the disadvantaged in society?
Christians have a responsibility to take care of the poorest among us. The Bible says, “He who oppresses the poor reproaches his Maker, but he who honors Him has mercy on the needy.” Proverbs 14:31.
In socialism, the government steps in to help the needy and to give assistance to those people by providing programs such as welfare. In capitalism, the more one is blessed, the more responsibility he has to take care of the poor. “For everyone to whom much is given, from him much is required (Luke 12:48).”
Another difference between socialism and capitalism is the motivation to be generous to others. Under socialism, the government uses compulsion or taxation to force the rich to give to the poor and disadvantaged. An amoral government determines which needs are met and which needs will not. Under capitalism, the rich have a moral responsibility to be merciful to the poor and to give generously. Americans, because we have been a capitalist system, have always been a generous people. Individuals in capitalism determine which needs to meet and which needs not to meet from the compassion of their hearts and give accordingly.
Which system works best?
Throughout the societies of the world both socialist and capitalist systems are functioning for all to see. There is not one genuinely socialistic society in the world where people prosper. It appears that the ruling class thrives at the expense of the masses. In a truly capitalistic society, people prosper according to their ability and achievement regardless of birth or socio-economic class.
“For when they say, ‘Peace and safety!’ then sudden destruction comes upon them, as labor pains upon a pregnant woman. And they shall not escape.” I Thessalonians 5:3