Major decisions were made by the highest-ranking members of the Communist Party, which, in the Soviet Union, was the Politburo. And because communist economies are not efficient and because of the Communist Party's desire to retain power, most economic resources were devoted to industrialization and to the military, depriving consumers of food and other necessary products, causing intense competition for these limited necessities, where many people had to wait in long lines for common consumer goods, such as toilet paper.Īnother major feature of communist economies was their emphasis on the country's self-reliance, discouraging international trade and investment.These employees operate under party-appointed economic planners, who set output targets and prices and frequently interfered with the operations to satisfy personal or party desires.The government owns all means of production, which is managed by employees of the state.The centrally planned economy had the following major attributes: Communist countries, particularly Russia and China, decided on a centrally planned economy (aka command economy). He believed that a political revolution was essential because the state was a central instrument of capitalist society, and since the bourgeoisie had a stranglehold on the government, it would be necessary to use force and violence to overthrow the capitalists.Īlthough Marx and Engels believed that property should belong to society, they did not really give much thought to how economic decisions would be made. Karl Marx called the ruling class the bourgeoisie. Marx and Engels believed there was a class struggle between the masses, which Marx called the proletariat, who could only offer their labor, and the owners of the means of production, which included land, raw materials, tools and machines, and especially money. Karl Marx agreed with Louis Blanc in how labor and income should be managed: "From each according to his abilities, to each according to his needs." However, it seems clear from history that Adam Smith had the correct principle, which is that people work in their own self-interest. The end goal of communism was to eliminate class distinctions among people, where everyone shared equally in the proceeds of society, when government would no longer be needed.
The capitalist system at that time required workers to work under harsh and dangerous conditions for little pay. Like the socialists before them, they wanted to end the exploitation of the masses by the few.
The most important originators of communist doctrine were Karl Marx and Frederick Engels. Communism, also known as a command system, is an economic system where the government owns most of the factors of production and decides the allocation of resources and what products and services will be provided.
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