BICOL COLLEGE

SENIOR HIGH SCHOOL DEPARTMENT

Cor. J. P. Rizal & R.F. Tabuena Sts.
Sagpon, Daraga, Albay, Philippines 4501

Self-Learning Module in Philippine

Politics and Governance
Quarter 3 – Module 3 Socialism,
Communism, Capitalism,
Liberalism and Neoliberalism

Ms. Marisol E. Hernandez

Subject Teacher

MARICAR T. MAGCALEN, Ed.D, RGC, RPm

SHS COORDINATOR
 Socialism, Communism, Capitalism,
Liberalism and Neoliberalism

This module delves in the study of political ideologies which

involve the nature, role, and significance of political ideas in understanding the various
political phenomenon.
The module is intended to discuss Socialism, Communism, Capitalism, Liberalism and
Neoliberalism as political ideologies.

After going through this module, you are expected to:

1. Define socialism, communism, capitalism, liberalism and neoliberalism.
2. Differentiate the five political ideologies in terms of economic and political impact and
significance to one’s life.

For you to have a better understanding of the lesson presented in this module, you
should be familiar with the following terms:
❑ CAPITALISM – an economic system where private entities own the factors of
production.
❑ COMMUNISM – an economic, social and political doctrine that aims to replace
private property and a profit-based economy with public ownership and communal
control of at least the major means of production and the natural resources of a society.
❑ FREEDOM – the ability to think or act as one wishes, a capacity that can be
associated with the individual, a social group or a nation.
❑ FREE-MARKET ECONOMY – trade is conducted on a voluntary, or non-regulated
basis.
❑ INDIVIDUALISM – the belief in the supreme importance of the individual over any
social group or collective body.
❑ JUSTICE – a moral standard of fairness and impartiality. It is giving what is due to
each person.
❑ LAISSEZ-FAIRE – a doctrine opposing governmental interference in economic
affairs beyond the minimum necessary for the maintenance of peace and property
rights.
❑ LIBERALISM – political doctrine that takes protecting and enhancing the freedom of
the individual to be the central problem of politics.
❑ NEOLIBERALISM – an ideology and policy model that emphasizes the value of free
market competition.
❑ POLITICAL IDEOLOGIES – belief systems that provide people with a perspective on
the proper role of elected officials, which types of public policies should be prioritized,
and how they realize it, most people possess a definitive political ideology.
❑ SOCIALISM – left-wing political system where the principle means of production,
distribution and exchange are in common ownership.
❑ TOLERATION – the willingness to accept views or action with which one is in
disagreement

Socialism
Left-wing political system where the principle means of production, distribution
and exchange are in common ownership. In its early forms, socialism was a reaction
against the stark inequality and misery produced by the Industrial Revolution and
emerging capitalist economies, where those with property had political voice but those
without were open to exploitation and oppression. Socialism is concerned with welfare
of the people, and as such is concerned with providing health care and education and
the provision of other necessities of a healthy life in order to create a more ‘level’
society.

Socialist ideals include production for use, rather than for profit; an equitable
distribution of wealth and material resources among all people; no more competitive
buying and selling in the market; and free access to goods and services. Or, as an old
socialist slogan describes it, “from each according to ability, to each according to need.”
In a socialist economy, public officials control producers, consumers, savers, borrowers,
and investors by taking over and regulating trade, the flow of capital and other
resources. In a free-market economy, trade is conducted on a voluntary, or non-
regulated, basis. Unlike communism, one of the corner stones of socialism is to have
the state own all capital and natural resources within its sovereign territory. This means
that the people being represented by the government will control everything and thus
social classes would be greatly undermined or eliminated together.

References: Sadera Jefferson M., Asistio Fevvie Von G., Baguling Randy L. et al.
Politics Governance for Senior High School. 2018 Jimczyville Publications Tabajen
Rhene C., Pulma Erlinda B. Philippine Politics and Governance. 2016. JFS Publishing
Services
https://www.investopedia.com/terms/s/socialism.asp

Communism
 It is an economic, social and political doctrine that aims to replace private
property and a profit-based economy with public ownership and communal control of at
least the major means of production (e.g., mines, mills, and factories) and the natural
resources of a society. Communism is thus a form of socialism—a higher and more
advanced form, according to its advocates. As an extreme left-wing ideology, based on
the revolutionary socialist teachings of Karl Marx, it is characterized by collective
ownership and planned economy. Thus, each should work to their capability and
receive according to their needs. Communism is the result of the process by which
workers, the proletariat, overthrow the capitalist and bourgeois masters and take control
of the means of production. The producers become the owner of the production.
References: Sadera Jefferson M., Asistio Fevvie Von G., Baguling Randy L. et al.
Politics Governance for Senior High School. 2018 Jimczyville Publications Tabajen
Rhene C., Pulma Erlinda B. Philippine Politics and Governance. 2016. JFS Publishing
Services
https://www.britannica.com/topic/communism

Capitalism
Capitalism is an economic system where private entities own the factors of
production. The four factors are entrepreneurship, capital goods, natural resources, and
labor. The owners of capital goods, natural resources, and entrepreneurship exercise
control through companies. Individuals own their labor. Capitalistic ownership means
owners control the factors of production and derive their income from their ownership.
That gives them the ability to operate their companies efficiently. It also provides them
with the incentive to maximize profit.
Capitalism requires a free-market economy to succeed. It distributes goods and
services according to the laws of supply and demand. The law of demand says that
when demand increases for a particular product, its price rises. When competitors
realize they can make a higher profit, they increase production. The greater supply
reduces prices to a level where only the best competitors remain. The owners of supply
compete against each other for the highest profit. They sell their goods at the highest
possible price while keeping their costs as low as possible. Competition keeps prices
moderate and production efficient. Another component of capitalism is the free
operation of the capital markets. The laws of supply and demand set fair prices for
stocks, bonds, derivatives, currency, and commodities. Capital markets allow
companies to raise funds to expand.
Capitalism results in the best products for the best prices because consumers
will pay more for what they want the most. Businesses provide what customers want at
the highest prices they’ll pay, and prices are kept low by competition among
businesses. They make their products as efficiently as possible to maximize profit.
Capitalism ignores external costs, such as pollution and climate change. This makes
goods cheaper and more accessible in the short run, but over time, it depletes natural
resources, lowers the quality of life in the affected areas, and increases costs for
everyone.
Reference: https://www.thebalance.com/capitalism

Liberalism
A political doctrine that takes protecting and enhancing the freedom of the
individual to be the central problem of politics. Liberals typically believe that government
is necessary to protect individuals from being harmed by others, but they also recognize
that government itself can pose a threat to liberty. As the revolutionary American
pamphleteer Thomas Paine expressed it in Common Sense (1776), government is at
best “a necessary evil.” Laws, judges, and police are needed to secure the individual’s
life and liberty, but their coercive power may also be turned against him. The problem,
then, is to devise a system that gives government the power necessary to protect
individual liberty but also prevents those who govern from abusing that power.
Underlying the liberal belief in adversarial is the conviction that human beings are
essentially rational creatures capable of settling their political disputes through dialogue
and compromise.
Liberalism adheres to the following beliefs: Individualism, freedom, reason,
justice, and toleration. Individualism- the belief in the supreme importance of the
individual over any social group or collective body.
Freedom- the ability to think or act as one wishes, a capacity that can be associated
with the individual, a social group or a nation. Individual liberty is the supreme political
value and the unifying principle of liberalism.
Reason- gives human beings the capacity to take charge of their own lives and fashion
their own destinies. Humankind was emancipated from the grip of the past and the
weight of customs and traditions.
Justice- a moral standard of fairness and impartiality. It is giving what is due to each
person. Toleration the willingness to accept views or action with which one is in
disagreement.
Reference: Tabajen Rhene C., Pulma Erlinda B. Philippine Politics and Governance.
2016. JFS Publishing Services
https://www.britannica.com/topic/liberalism

Neoliberalism
An ideology and policy model that emphasizes the value of free market
competition. Although there is considerable debate as to the defining features of
neoliberal thought and practice, it is most commonly associated with laissez-faire
economics. In particular, neoliberalism is often characterized in terms of its belief in
sustained economic growth as the means to achieve human progress, its confidence in
free markets as the most efficient allocation of resources, its emphasis on minimal state
intervention in economic and social affairs, and its commitment to the freedom of trade
and capital. As national economies became more interdependent in the new era of
economic globalization, neoliberals also promoted free-trade policies and the free
movement of international capital.
 It suggests that states are constantly interacting with each other and that they
value cooperation as part of their own interest. It further refers to the revival of economic
liberalism. It is connected with a belief in market fundamentalism- the absolute faith in
the market, reflecting the belief that the market mechanism offers solutions to all
economic and social problems.
Reference: https://www.britannica.com/science/scienc