Thanks.
But did those systems ‘fail’ or were they altered by legislation, progressivism, etc.?
I am not much of a scholar on ‘economic’ history of various countries of the world.
None of the failed in the sense of collapsing, but no capitalist system has ever lived up to the ideal of a laissez faire free market, which is both good and bad.
Essentially all of the excesses Marx critiqued were not due to the free market's operation, but to the suborning of state power on behalf of the rich: toss union organizers in jail, turn a blind eye when the Pinkertons or their European analogs roughed up workers, or worse still have the law and the police side with money, rather than impartially enforce justice. Most, though not all, of the problems we have in the current economic downturn are similarly due to the exercise of state power, whether on behalf of the poor (forcing banks to abandon sound lending practices for political reasons) or the rich professional managerial class (Wall Street and bank bailouts).
Of course, there have been and are useful roles for the state in economic development besides those essential to capitalism--the impartial enforcement of property rights and contracts and provision of a stable currency--I've enumerated examples before:
- Creation of utility, railroad and highway rights of way by eminent domain.
- Public highways. Yes, in theory, a massive highway system could have been built and maintained by private enterprise, but there are Constitutional reasons (postal service, which needs post roads, and national defense--one of the main reasons for the Interstate Highway system, that had DoD design input was Ike's desire for good highways to take advantage of interior lines should the U.S. ever be invaded) for the Federal government to do it, and right-of-ways would still have needed the action of state power through eminent domain.
- Research in basic science and speculative technologies. Again, one might be able to get private enterprise to fund this, but only through indirect state action in the form of tax policy.
- The internet. The backbone was a DoD project to link military research facilities and universities called the ARPAnet. (I'm old enough to have used e-mail on the ARPAnet before there was an internet.) The original e-mail and FTP protocols were developed under contract from ARPA, and html was developed at CERN (funded by European governments).
Optimally besides the minimal economic functions advocated by libertarians, the state should only do those things which support economic development that cannot be done well by the market, even without the prompting of tax policy.