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Id ESLPod_0783_CN
Episode Id ESLPod 783
Episode Title Different Political Philosophies
Title Common Terms Used When Talking About Capitalism
Text

Capitalists believe most businesses should be owned by individuals and government interference should be "minimized" (made as little or small as possible) because market forces will regulate economic transactions.

Capitalists promote "laissez faire" policies, which is the idea that government should let the economy develop naturally, without very much (or any) influence. "In practice" (in reality), most people recognize that the government needs to have at least some level of involvement, such as providing "social welfare programs" (assistance for low-income people) and "safety nets" (programs that help people who have no other options, especially after losing a job or becoming disabled).

"Free enterprise" is a concept that is similar to laissez faire, in that it means letting private businesses operate "freely" (without controls or restrictions) without being controlled by the government. Some "extremists" (people with very extreme beliefs) believe truly free enterprise is possible only "in the absence of" (without) taxes and regulations.

Capitalists believe in power of the "market economy," or an economic system where businesses decide how much of a good or service they will provide and at what price they will sell it, and individuals decide how much of a good or service they will "consume" (buy and use) at a given price. The market economy works, because each business wants to "engage in actions" (do things) that will maximize its "profitability" (all money received minus all expenses).

Economists talk about the "invisible hand" that guides the market to the appropriate price for a given good or service depending on "supply" (how much of something is available for sale) and "demand" (how much of something people want to buy).

Topics Government + Law

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