em. Every year businesses fail for lack of profit, but those who survive tend to be those who have learned to make the most efficient use of the factors of production. SocialismSocialism is an economic philosophy based on the idea that the benefits of economic activity -wealth-should be equitably distributed throughout society. Socialism rejects the concept of private ownership, individualism, and competitions for profit that lie at the heart of capitalistic thought and practice.Present-day socialism developed in a large part as a reaction to the poverty and other miseries that accompanied the Industrial Revolution. Karl Marx, the father of modern-day socialism, was the most significant critic of capitalism to emerge in the nineteenth century. He believed that capitalism was fatally flawed.A powerful socialist movement took shape among European workers and thinkers during the middle and late nineteenth century. Some argued that a socialist society could come only out of a violent and bloody revolution. Others argued that socialism could be attained by peaceful means, through the democratic process. The process of organizing enterprises under governmental control-often by taking over privately owned industries, was called nationalization. Socialist stress the goal of assuring that every one in a society is decently housed and fed. Countries that provide extensive social services at little or no cost to the users are called welfare states. All governments, capitalistic or socialist, get their funds from taxation. Although social welfare is quite expensive, taxes in socialist countries tend to be high. Under socialism, decision-making is much more centralized, therefore, governments can direct the economy along desired paths.Socialism has won a large following in developing countries. One reason for socialism appeal is that most developing countries are starting from scratch. It also appeals to leaders wh...
