(Up to: Why IDon TLike Capitalism Economics Supply First Demand Later )

An analogy. They help me to think about things in very simplistic ways. After all, many complex systems boild down to extremely simple concepts once you've blown off all the crud and simplified everything a little. Not too much, though.

I like thinking of free markets and socialism as a bunch of people tidying up after a party. To make it easier, I think of free markets/capitalism as competitive behaviour, and socialism as co-ordinated behaviour.

The capitalists believe that people will be best off if everyone in the group does what they think is best for them. Thus, everyone wants to tidy the easiest, cleanest things - clearing bottles away rather than mopping up the pile of sick in the corner. To an extreme, people will actually fight over who gets to tidy what up, with the winner getting to clear less, or easier things.

This way, everyone (on average) has a better cleaning up time, as this way nobody has to deal with the sick. Everyone is better off. Some are better off than others, as they cleaned less.

Meanwhile, the socialists each tidy up, say, whatever is closest to them. That's about as co-ordinated as it needs to be for this analogy. This means that some people will grumble about what they have, especially when they see that other people just have to tidy a bottle away, and they have to tidy the sick up. But that's what's been decided, and it gets done. This way, more people are having less fun tidying up, plus somebody has to clean up the sick, which means that it is less equal.

Under the capitalists, everyone is happier, but the place is left a mess. This is ok, until the mess gets to an unreasonable size, at some point in the future.

Under the socialists, some people aren't as happy. But the place is tidier, and everyone benefits from that.

Perhaps this is about wealth, and the wellbeing of a nation. But (as I've said before), the problem with capitalism is that it measures things only in a single axis - economic wealth (analogous to how much little people had to do, above - more capital = less work), and ignores everything else. It attempts to measure wellbeing by this value, but doesn't take into account any other "environmental" factors that contribute to wellbeing. Even if you don't believe in Global Warming, this can clearly be seen in effect - try swimming anywhere in the sea in the UK, for instance. But (and this is why I cannot become a free marketeer, even though its arguments are internally sound) such a system that attempts to promote freedom without responsibility is unsustainable, by its nature. And so guidelines are needed, in some form.

I think this analogy also represents two sides of game theory. In any species, there are the selfish genes, and the altruistic genes. Both need each other?

(See also: Analysis Greed )