by Richard Register, President, Ecocity Builders
First, it's helpful to understand that we live in a capital system, not a capitalist system. That system is a subsystem of an economic system made up of the total system of natural economics and human economics entwined in the ecological realities of solar energy, the lithosphere, hydrosphere, atmosphere and biosphere. For better elucidation here I'll call that the total economic system or total economics, italicizing the terms I want to emphasize so we can hone in on the ideas behind the terms as we go.
As the Gaia theorists have amply demonstrated with little if anything to counter their assertions, life plays a role of regulating the entire natural economy plus human economy on Earth, the total economics. Life forms in their billions of species through time and their mind boggling number of individuals, through various negative feedback loops, have regulated oxygen in the atmosphere at levels supportive of life and salinity in the oceans within limits, also amenable to life. It is hard to see this pattern on something as gigantic as the Earth with its towering mountains and endless plains and oceans but that's mainly because we can't easily grasp the enormity of time involved in the total evolutionary process. Simply this: given enough time, little things add up - especially if their numbers are as staggering as the time over which they work.
The basic structure of that overall total economics is comprised of two main categories. First there is the natural economics of material and energy on Earth. Second there is human economics made up of two major steps in its evolution. The first of those two steps in human economics is the gift economics of people as they start dealing with surplus at its nearly irreducible minimal, sharing milk with babies and sharing food brought back from the hunt and from fruit picking, the skin prepared for the family blanket, the windbreak for shelter from the wind, rain, snow, and in more equatorial regions, blistering sun and heat.
Then the second step in human economics, evolving from the first step is the capital economics in which a "neutral medium of exchange" becomes dominant, functioning to lubricate and speed exchange and to simplify who owes who what, and what amount of it. Making a chart of those economics, after which I'll describe capitalism's and socialism's fit therein, might produce something like this: