Capitalism is the foundation of the US economy and market, and has been for generations. Capitalism is a evocation of private ownership and entrepreneurship, where wealth is distributed according to status and attainment and those with aspiration can achieve anything that they desire. In an economy that is largely supported by capitalist values, there are likely to be enhanced extremities of wealth and poverty, with the result being that a government has a duty to protect the more vulnerable members of society. To work effectively however, business owners and those that they employ also have a responsibility to assist the government with responsible spending and financial management.
The importance of the US as a world economy and therefore its influential figures is epitomized by the global recession of 2007. As organizations failed to heed the worrying portents in the US economy prior to this date, the subsequent collapse of the US housing market reduced the values of all affiliated securities, creating a global impact on economies worldwide. The consequences are well publicised, and many industry experts suggested that investors and financial lending bodies gravely misread the risk involved with mortgages and mortgage related services. Of course, this sudden economic decline prompted governments to respond with rescue packages that came at the cost of the individual tax payer.
While it is ridiculous to suggest that the US should adopt communist values, the example acts as a good model with which to understand differences and areas of concern. In a communist society everyone understands their roles and the overall aspiration of a nation and economy, whereas the lines of responsibility are less well defined in capitalist countries. This is where issues occur, and it is important for a government to encourage individual responsibility with regards to their own role in assisting a generative and well founded economy.
The UK Prime Minister of the 1980’s, Maggie Thatcher, preached the values of financial independence in society. The argument is an excellent study in business and workforce members taking control of their own finances and conduct to contribute to a prosperous economy, and suggested that if each individual, family and business owner took responsibility for every aspect of their financial well being and education, then the overall concepts of society and economy take care of themselves. This ethos still allows the development of wealth and aspiration, but also reduces the burden on governments and helps to define the role of contributors within a society.