by Tradewinds
The most centrally planned economies of the former communist block of the USSR and Eastern Europe all had thriving "black market" where scarce goods were exchanged or bought or sold.
Cuba is another example where street capitalism is thriving.
The only real growth in India under its four five-year plans was from a prosperous private sector.. When central planning was dropped, the economy of India took off as the capitalistic system began to allocate capital based on return on capital invested as opposed to government central planning priorities.
In all cases these centrally planned economies failed and gradually became capitalistic.
Sad to say that today there has NEVER been a national five-year plan that has ever been implemented despite the millions of dollars the World Bank wasted on technical assistance for economic planning.
Scarce resources will always be allocated by the return on investment principle. Whether a business firm is making an investment decision to build a new plant or an individual investor is making a decision to buy a stock or bond for his personal portfolio, the invisible hand of capitalism is always at work.
Investment risk is fully accessed and rates of return are estimated against the risk spectrum. Then and only then is capital invested seeking a rate of return consummate with the degree of risk.
Some may think profits are a dirty word, but no one ever seems to turn it down. Even the Occupy Wall Street gang are a creature of capitalism and most do not even realize it.
Unfortunately, capitalism is often taught in our colleges and universities as a system of economic exploitation. It is characterized as unfair and unjust to the factor of labor input. What they neglect to tell students is that capitalism, far from being a perfect system, has been the driving force for the creation of national growth over the last five hundred years. No other economic system known to mankind has done so much for so many. Every other economic system has failed the test of economic prudence and efficiency.
In the final chapter of socialist and communist countries, capitalism rises again and again to be the driving force to economic prosperity. So try as they might, Capitalism can never be destroyed.
