Forms of Government: Capitalism vs. Communism

March 18, 2022

Historical Context

Soviet leader Mikhail Gorbachev and
U.S. president Ronald Reagan at a
Soviet/US Summit in 1985 
(Image credit: Getty/ Bettmann)

For the better part of 50 years, the world was embattled in a ideological war: Capitalism vs. Communism – Democracy vs. Authoritarianism.  The period, we refer to as the Cold War, set the stage for most of the relationships the US maintains across the globe today.  During this time, we saw the division of the world into “the West” and “the East” – symbolized by the Berlin wall which literally drew the line.  The West, led by the US, was made up of countries that were democratic and capitalist.  The East, led by the Soviet Union (now Russia) …and to some extent China, was predominantly Authoritarian and Communist.  Then in the early 1990s, we saw the collapse of the Soviet Union – as democracy was ushered in. The war was over….or was it?

Why it matters today

While the Cold War formally may have ended – the United States and the West still cling to democratic capitalist tendencies while Russia still has roots influenced by its communist past.  Understanding these economic and ideological underpinnings helps us understand the why behind the continued behaviors of today.  Russia as an aggressor in democratic Ukraine; the reason the US calls on NATO forces in conflicts around the globe…or the fears that Putin may use nuclear weapons… If the Cold War is the foundation of most of today’s global relationships – then we must first start with teaching kids “what caused the Cold War.” 

How I illustrated it to my kids

My 7 year old is really into earning money…so he can buy Legos (so so many Legos).  For a while, he thought the only way to earn his money was from Birthdays – or the tooth fairy….or with really elaborate concerts in the front yard where he would sell tickets to the neighbors.  So any illustration I can give him that uses money is always sure to be a lesson learned and retained.  And so we sat down with a handful of dollar bills and a whiteboard

I asked my son to give me a chore he wanted to do to earn money – and he chose raking leaves.


Capitalism is an economic system where a country’s trade and industry are controlled by the private ownership of business and with goal of making profit.

  • If you earn $2 for each yard raked and you rake 7 yards – how much money do you make?
  • Now what if sister rakes 3 yards – how much money does she make?
  • So – who made more money? Why did they make more money? Is that fair?


Communism is an economic system where a country’s trade and industry are controlled by the government and is given to each individual based on their needs.

  • I have decided that if you rake 7 yards, you make $10
  • I have decided to give sister $10 if she rakes 3 yards – because she needs $10
  • Who makes more money? Who makes more money per yard? Is that fair?

I was truly impressed by the answers that my kids came up with to these questions.  They saw fairness and justness in both systems.  Their unadulterated minds didn’t know that as Americans we tend to promote capitalism….their minds saw that it was not only good to work hard for their own benefit, but also good to share with others.  They saw the importance of a dollar to both themselves and to each other.  I think they both settled at liking capitalism better – given the opportunity to continue to earn more.  The best part of this exercise? My 4 year old was inspired to head out to the backyard and rake a few leaves .

Note: These concepts are complex and nuanced – and there is far more to both capitalism and communism than what I illustrated to the kids. Feel free to take your own spin, and add to the story. My kids, who are 7 & 4 are at the stage that they need simple concepts they can grasp. As they grow, we will teach them more about this topic.

Links to Tools Used
I use these whiteboards all the time
I love this multi-colored pack of dry erase markers

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