Answered Essay: Why is American Capitalism under crisis? What are its failings and what are some of the ways

Why is American Capitalism under crisis? What are its failings and what are some of the ways forward?

Expert Answer

Capitalism is when there is minimal interference of government, other agencies and freedom of doing trade is present.

But due to several economic crises happened in the past, several reforms have taken place and that has caused:

  • Several regulations in doing business in each and every industry
  • There are several laws in place to prevent bankruptcy
  • Due to several insolvency, government has stakes in several players, by which it wants to restrict full throtle capitalism.
  • Slowly but surely several welfare laws have come government wants to take care of the society, there by going away from capitalism towards socialism
  • In the recent past govt has bailed out several companies and there by taken stake in operating or directing the operation and managing the industries, leading to control of the businesses.
  • Several visa regulations in place making it difficult to run businesses

The failings of it are:

  • Companies find US tougher to do business and run their operation profitably
  • Companies become more conservative and do not opt to expand further in US, so there are less investments
  • The cost of doing business is much higher as compared to several other destinations
  • The businesses become slow and growth is restricted.

The way forward is , several states should make special provision for companies to thrive.

Have special economic zones, which allows companies easier environment, higher rate of subsidy to expand and tax benefits leading to booming economy.

Have regulations removed at a larger scale for selective industries,which will help have capitalism in those sectors and provide better facility for development.

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