Hi Tracey!
I think Lilliara’s definitions work well for defining capitalism and free trade
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Capitalism: An economic system in which investment in and ownership of the means of production, distribution, and exchange of wealth is made and maintained chiefly by private individuals or corporations
Free Trade: Trade between diferent countries, free of governmental restrictions or duties. 2) International trade free from protective duties. 3) The system, priniples or maintenence of such trade.
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In the above definition of capitalism we have to highlight the word
chiefly. Capitalism does not imply complete laissez-faire. There are parts of the economy in public ownership, and with degrees of regulation (health & safety, environment, enforcing competition). An interesting note to government intervention in private industry is that it is usually negative: the rules say what a person or corporation can
not do, in other words they lay the outside parameters and allow a degree of laissez-faire inside those parameters.
A misconception of ‘free trade’ is that it really isn’t free, b/c as G’kar stated, someone is gonna pay. However, this misconception is b/c the term free is carried too far. It can only be applied to the term trade, not carried forward to the effects on domestic industry, private citizens, etc…the best way to look at ‘free trade’ is by using the term ‘unrestricted’ rather than ‘free’, this will dispell the notion that no one pays. Like the definition above states, free trade is merely the removal of restrictions like taxes, tariffs, and quotas.
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he thinks that capitalism per se is a workable system not really attatched to the concept of free trade and i think that are inextricably bound together in this day and age, anyway.
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I would have to agree with your boyfriend on this one
Capitalism and free trade are independent entities. A capitalist economy can (and has) function perfectly fine in a restricted trade environment. Likewise, free trade is not restricted to capitalist economies. Socialist, communist, or any other type of economic system can (and has) function with free trade in place.
A way to look at this is that capitalism is a means of production, and free trade is a means of distribution. The two are linked but not dependent on one another.
There are more points I would like to address but at a later time, as I am off to a meeting
Hope this helps a little!
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