Capitalism faces several challenges and problems. Two main problems with capitalism are, property and income become unequal, and major industries suppress small entrepreneurs. The advantage and costs reflects the fist choice of the buyers that want to spend money. Instead the first choice should be more on the people who don’t have money to spend, like the poor. This problem also affects house rent. That is why property and income are unequal and have a negative affect on the economy. Another problem with capitalism is, the major industries suppress small entrepreneurs. There is a lot of competition, which causes small companies who are trying to introduce something new a great deal of challenge. Many of the large industries are famous and well know which is a disadvantage to the small entrepreneurs who are trying something new. An example of this was in the movie, how Tucker was a small entrepreneur trying to introduce a new car, and the large car industries ( the Big Three) served as a challenge and stood in his way. They gave him trouble even though he was successful at the end. This competition against big and small industries is a problem with capitalism. One challenge with capitalism, is the conflict between the employers and the employees. Because they distinct each other by class, this causes the conflict. They should only be one class, which is the working class. Another challenge is the nationalism communist threat and takeover would create regional conflicts and wars. Capitalism confronts many other problems and challenges.

There are some differences between mixed capitalism and market socialism. In a government managed capitalism, the government controls some of the issues of production. Government ownership is limited but they still have some kind of control. Individuals still have an influence on the economy. This is different compared to market socialism, where the government owns the enterprises which was a way of arranging society. It is similar to mixed capitalism, because the government does not direct the economy. Even though the enterprise is controlled by the government it is still run my certain manager. An advantage for both the government managed capitalism and market socialism is that individuals still have an influence and a roll.

Mixed capitalism is more effective to our economy. The market socialism has several problems and is weak, especially since the government owns the enterprises, “soft budget constraints’ cause a problem. There are more problems with market socialism than with mixed capitalism. That is why mixed capitalism is more successful and efficient.

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