The wealth of a country can either be under the control of the people or the government. It is my opinion that the government should be the one controlling the distribution of wealth in a country to make sure that equality is achieved. It is only through the use of a federal authority like the government that resources and funds can be distributed in a transparent and just manner devoid of any institution or person passing through the phase of destabilizing.
In a country, the government should be the one controlling wealth or resources; with the state directing how the wealth is utilized by its citizens if at all equality of benefits and opportunity is to be achieved. Equivalence in deliverance of opportunities is primarily mounted on political background and negates caste hierarchy. However, the basic assumption is that the society has hierarchy of more or less required superior or inferior positions. According to the caste society, individual assignment to place in social hierarchy is determined by birth. Equality of benefits to citizens of a country provides all the citizens with the equal right to live comfortably in every part of the country, have the right to contest for elections and chose their leaders, have their preferred professions among many other things. The effect of equality has led to a sense of respect among the citizens of a particular country.
Planned and unplanned forms of economies contradict in many aspects including differences in production sharing and pricing. However, it is possible to have a government-controlled economy that considers macroeconomic planning. Production sharing, pricing along with investment based decisions are made by private or individual owners of companies. This is generally done on the basis of their personal interests instead of the interest of the macroeconomic planning. A planned economy may consist of privately owned firms, companies and factories that are controlled by the government. For instance, a well known planned economy that existed in the past is the Soviet Union economy, which according to the CIA was the world’s second largest economy (Pejovic 120).
The reason why I prefer the government to control resources of the country is due to a number of influential factors. These include; stability, meeting collective objectives, comparison with the capitalist’s corporations and advantage over market economy.
Government-controlled resources lead to a more stable economy since the government can invest in infrastructure with more certainty of success. Long-term investment in infrastructure can be made without any fear in market down turn that can lead to the rejection of the project. This is especially important where the earnings are risky. For instance, in the fusion reactor technology or where the return is hard to come by in public education or immunization programs.
The government can contribute to economic development easily compared to individual contributions since the government can control factors of production to favor the interests of the state at large. In a planned economy, personal profit motives as a driving force are eliminated and replaced by the state planners who determine the correct production of various sets of goods (Brabant 100). Moreover, standardized goods are produced in planned economies. Through this system, factors of production can also be harnessed by the government to serve the economic interests of the state. Consumption of goods for instance, can be controlled by the government to favor huge capital investment. This can be done to ensure that economic development is achieved through a desired pattern. The government for example can decide to build a heavy industry easily in an underdeveloped economy without having to wait for many years to give room for the capital to accumulate not relying on external funding. This technique is what the Soviet Union used in 1930s when the state forced the sharing of GNP dedicated to the private use to be reduced by thirty percent from 80% to 50 %. As a result of such interventions, the Soviet Union realized a massive economic growth in heavy industry sector at the expense of heavy starvation (Eckstein 137).
A centrally planned economy is preferable since the government can merge firms easily to form one strong organization that controls the rest fairly. Centrally planned economy tries to substitute various firms with one firm for the whole economy. The stability of a planned economy impacts heavily on the firm’s theory. Most corporations have a central economy save for the token-intra-corporate system of setting prices. Firms are no doubt needed in a free market as evidenced by existence of these firms. The idea of the entire economy being under the control of a single firm is not pleasing to opponents of planned economies. A number of theorists have pointed out to many ways by which the government’s role in the market increases economies of scale, counteracting natural failures of centrally planned economies historical subsidies and privileges granted by force and argue that corporations do not exist in free markets (Siebert 98).
Planned economies are free from the negative effects of business cycles that may slow economic growth thus they are preferable to people-run economies. There is a big advantage of the socialist economists over the market economy. Hypothetically, a planned economy is free from the business cycle’s negative effects. It is not subjected to overproduction crises like the one believed to have occasioned the great depression. In modern context, it does not lead to asset bubbles, housing bubble of the mid 2000s and the dot.com bubbles of the late 1990s.
By leaving individuals to control the economy, many people may end up lacking access to basic needs as well as failure to afford basic needs due to inflation and high taxation. It is a common phenomenon that centrally planned economy can give public goods. Which otherwise may have not been available, or might need transparency or very open federal provision. This goal can only be achieved through inflation or taxation in a mixed economy. State planners would allocate resources belonging to the state to public projects and goods (Brabant 200).
A planned economy is the best way to control and distribute a country’s wealth for the reason that it is the only way to achieve equality standards. If people are left to control resources, the chances of corruption and mismanagement can be very high. We all know when individuals control bulk amount of wealth; they can manipulate the same resources to favor their needs. It is in a market economy where issues of nepotism, tribalism and other negative practices are seen playing a role. Many of the private firms are not managed and lack transparency because one person like the general manager can have a huge negative impact over the other members who are not in the top management and may lead to the exploitation of such individuals at the cost of benefiting selfish and greedy workers. In contrast, using a planned economy, the voiceless in the society can easily access the very basic necessities without any from of favor (Eckstein 320).
In conclusion, the ability of a planned economy is transparent and clear. For instance like in factors like stability, objectivity, and substituting firms and to outweigh the market economy. These are clear indications that this is the only way equality of opportunity and benefit can be achieved and resources can be shared equitably without fear or favor. If people are given room to control the resources in a country, the probability of crises can be high enough. The only way of avoiding such problems is to ensure that the government controls the state resources in a fair manner by using the technique of a planned economy.
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