Marxism is better than capitalism

Note that Pro did not define capitalism in round 1, but rather, in round 2, refers to Adam Smith ideology. However, Pro's opening statement implies that this debate concerns modern day capitalism. To show why this is important, I would like to provide some text from a paper by Murray Rothbard describing Adam Smith's contribution to economics (1): On the other hand, Marxists, with somewhat more justice, hail Smith as the ultimate inspiration of their own Founding Father, Karl Marx. In fact, it was Smith who first proposed the labor theory of value, an important tenet of Marxism. The problem is, this theory has been abandoned, which isn't surprising, since it doesn't take much thought to see there is little connection between an items value and the labor that produces it. After all, if that were true, I'd quit my day job and just start making something ... anything. It wouldn't matter what. One cannot simply define capitalism as "the private ownership of the means of production". Instead I would like to define the key components of capitalism as it exists in the United States today: 1) capital accumulation and the private property protection 2) highly evolved division of labor 3) highly evolved use of money, along with market prices based on voluntary trade Point #3 invariably leads to a repudiation of the labor theory of value, therefore Adam Smith ideology is not a proper definition of modern capitalism. I will now address Pro's two points given round 2. Pro's first point claims that we are producing too much of some goods and not enough of others. However, no methodology has been given to determine what "too much" means. It seems that Pro basis this solely on his/her own subjective value. Under capitalism, the amount of a given good produced is determined by supply and demand. Market prices formed by voluntary trades are key to this system. If supply is abundant and demand low, an items cost is low. If supply is tight and demand high, an items cost is high. How would Pro (and Marx) solve this "problem" of too much beauty products produced rather than cancer research? Note that under capitalism, the amount of these two goods produced is exactly as demanded by everyone. To shift funds from beauty products to cancer research, there must exist a few elites forcing this to happen. Could there be anything more un-democratic than that? Pro claims that under capitalism the wrong goods are produced because they are produced based on profit motive instead of what's most beneficial to society. The mistake made here is the same as described above. The word "beneficial" is based on subjective value. What gives Pro, or Marx, or a few socialist elites the right to tell others that their subjective values are wrong? Pro next claims that capitalism does not provide everyone a fair chance to succeed economically and that Marxism will somehow fix this problem. It's easy to criticize a system, but it's quite a harder problem to "solve" it. Pro thinks that somehow government will solve this. I would ask Pro to describe how that would work. This can't simply be assumed because Marx said it would be. But fair is fair. I will now describe how capitalism solves the incredibly difficult problem of limited resources and infinite human desires. I have already hinted at this above in my discussion of market prices and supply/demand. This system evenly rations resources to create products that everyone, by way of voting with their dollars, demands. Pro claims that everyone does not have an equal chance to share in this success. I claim that is patently false. In 2013, the number of households with a net work over $1 million was 5.1 million and 80% of these households were first generation millionaires. That means there were 4 million first time millionaires. Also, usually this fortune will be lost by the second or third generation (2). This means that the population of millionaires is constantly changing. But perhaps none of the rich started poor. But that isn't true either. Here is a list of 16 billionaires who started out poor (3). But perhaps those 16 were just "lucky". But now I'll refer to a study that states "It's nice to think one can easily go from being dirt poor to filthy rich, but it doesn't usually work that way." (4) So this study seems to be biased in Pro's favor. But this study states that 26% rose from poor to middle class and 4% rose from poor to rich. I would say that, given that resources are limited, these are pretty good numbers. What numbers would Pro find acceptable? But, more to the point, how would these numbers be improved under Marxism? Simply assuming this into existance is not acceptable. At this point, I will show why Marxism has no hope of making things better. In fact, the opposite is true. Marxism will cause economic chaos and hardship. Economic Calculation Problem There is no private ownership under Marxism so there are no market prices. This fact alone deals a devastating blow to Marxism. I have already described by market prices are critical to a functioning economy. This problem was first exposed by Ludwig von Mises in 1920 (5) Consider there are 3.6 million retail stores in the United States (6). If each store has just 100 products, and if each product has just 10 price changes per year, that is 3.6 billion price changes. And this is only retail, which makes up about 16% of GDP. If we extrapolate that out, we get something like 22.5 billion prices changes for all products per year in the United States. Each of these price changes is in response to supply and demand at a local level. This simply can't be done under Marxism. Prices of higher order capital goods are even more critical because they help to conserve not only earths resources, but affect prices down the production line. In retail alone, the 360 million products had to each have many decisions made regarding materials to use, location of factories, etc. Prices drive all these decisions. In fact, after the publication of Mises paper, socialists knew they had a problem. They fought back by attempting to come up with solutions to this problem (such as "Market Socialism") none of which is tenable. The result will be overwhelming issues with over and under supply of goods. (1) https://mises.org... (2) http://facts.randomhistory.com... (3) http://business.financialpost.com... (4) http://economy.money.cnn.com... (5) https://mises.org... (6) http://selectusa.commerce.gov...