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OleMash [197]
3 years ago
10

The term mercantilism is best described as

Social Studies
1 answer:
aleksley [76]3 years ago
3 0
Specie economy. Specie are precious metals and gemstones. It leads to hoarding. Capital flows in only one direction: from the site of extraction, the periphery, to the ruler, the core. This leads to economic slowdown and stagnation. That's all I could think of. I kind of went off on it after "specie," but specie isn't a complete description so that's why. I'm probably missing something huge. We did have a gold standard up until 1972, when Nixon took us off of it. I guess that's another way to describe mercantilism: it's not a debt economy. In capitalism, capital is fluid, meaning it flows many ways, not just the one way as in mercantilism. Debt, then, creates profit. The government in a capitalist system wants to assume as much as the public debt as it can. It does not want a large stockpile of capital sitting inert in private hands. That is bad for democracy. The word is "inimical." When the government borrows, it doesn't have to print money to finance ventures. Buying things like an aircraft carrier is a venture. Our investments in overseas oil fields are ventures. The interest on these kinds of things is enormous and is used to keep the economy rolling. You borrow, then you finance ventures to pay off your debtors. The deficit is the difference between what you borrow and what you pay back. A surplus means you borrowed more so you have more incoming than outgoing. A deficit can mean you are being fiscally responsible since it shows that you are borrowing less than you are paying back. A deficit is an indicator--AN indicator, depending on other things, but a strong one--of a strong or rising military. Debt is more reliable for paying for war than specie is, and capitalism is a better engine for economic growth than class struggle. Both class struggle and mercantilism are closed systems, and that's what makes them fail. Mercantilism implies hoarding, and class struggle implies starving.
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