Anti Capitalism

Thanks for a balanced post. Too often, we see the typical back an forth, such as if you criticize capitalism you must be a communist or "the rich are evil" type of posts.

Market failures are often forgotten by the proponents of capitalism, as is rent seeking behavior, which is inherent in man and destructive to economic growth.

On the other hand, socialists have difficulties to understand that in order to do great things, concentration of resources (i.e. capital) is needed. This concentration of capital is provided by capitalism in a self-evolving, survival of the fittest fashion. Thus, free market capitalism is nothing but an extension of evolutionary mechanisms.

In contrast, man is also a social animal, and, thus, a social component of capitalism has evolved that keeps the excesses of capitalism in check. That's why social free market economies work best. I don't understand, though, why people want to undermine the social component for their own short term gain (hate of paying taxes), but long term economic loss.

 

We were much better off with large private firms doing basic research. When the government instituted policies which forced them to be abandoned we lost a national treasure. The transistor from Bell Labs, the mouse from ARC, the GUI interface from PARC, and the solar cell from the Gutta Percha company all came from private research and the labs are all now gone. Bill Gates developed DOS which changed the world as well. IBM Research still exists but has produced nothing world-changing that I can remember. The government funded some of this research with block grants but the companies were also funded internally. Bill Gates was totally privately funded.

So what has government investing in technology bought us? What happened to superconductor and cold fusion development?

The government invested in the space program but that was all engineering research, not basic research. It was all "we need a control unit with this input and this output and it must be this size and weight". I don't want to minimize what the engineers of the space program did but it wasn't basic research.

In my view government is pretty much unequipped to decide what to fund and at what level. I give you Solyndra as a prime example. And that was pure manufacturing development, not basic research at all.

As usual, when government gets in the way nothing good comes of it. I won't even get into the issue of entitlement spending crowding out basic research funding by by the government!

 

Profit is not how employees get paid. The salaries of employees are a cost that the firm must bear before it sells a single good.

There are many companies out there that don't turn any kind of a real profit yet still pay their employees.

 

You've never read Marx, have you?

I don't agree with the Labor Theory of Value, but to say Marx made up a fantasy as opposed to creating an incredibly well researched work is truly absurd. There's a reason Das Capital took decades to write. It's utterly filled with research.

 

Or by being the firm owner's child.

 

Sir, Das Kapital, is a classic example of confirmation bias and a blatantly obvious one. And Yes I've read it. It was required back when I was in high school. Most boringly pretentious pile of horse crap I've ever read. Page after page of assumptions based on air. I still blame it for the fact that half the leftists I've ever met are mathematically illiterate.

 

Your argument only applies if you don't comprehend that value is subjective. Marx may be wrong in my opinion about labor being the sole determinant of the value of goods, but he is right that systems of value of inherently subjective.

Capitalism relies on the exact same concept but acts as it value is intrinsic and objective. It isn't.

 

The basics of capitalism is that the value of any given item is established by it's utility and availability and since both of those are variable then the value of any given object is likewise variable. The only constant in capitalism is that if you can not sell your item for more than it costs you to make it you are going to go broke.

 

Capitalism isn't the problem, bad actors using capitalism are. Regulations against capitalism can never eliminate the bad actors. Only laws against the bad actors can deter the bad actors.

 

Japan was still manufacturing CRT TV's when S. Korea moved into making LCD TV's. Japan has had major problems in catching up. It's been the same thing with cell phones. Samsung (S. Korea) is now the pre-eminent cell phone manufacturer of non-iPhones. Hyundai and Kia (both of the Hyundai group out of S. Korea) are the fastest growing auto's in the US.

Japan is suffering from the same thing our steel industry did so many years ago - cash cow's milked for all their worth with little updating of the manufacturing processes. Japanese manufacturing has certainly not collapsed but it has fallen behind.

 

So, if your little grocer really excels and his store becomes a chain providing many more jobs and potential for his employees, he changes from a respectable trader to a evil capitalist?

So the person who is employed at the grocers little store- starts a small business. He is selling his product (himself) but he has only one customer- the grocer. Feeling that he is a slave, even though he if free to sell his product anywhere to anyone at any price he can- and has a large number of benefits and protections of which the grocer has none- he soon feels things are so unfair that employees should bring in the union. Then, they can hogtie the evil grocer; demand more money for less work and get many special conditions. They can strike in an organized industry wide way, so that they can bring the grocer to his knees, even destroy him if he does not capitulate to their demands. They collude with Teamsters and other unions, to block the deliveries and services the grocer needs to survive. They put pickets in front of his store, telling all his customers what an evil bastard this grocer is. Not sure what you would call that, but probably you would think it justified. I have other names for it.

Now if the grocer agrees with other grocers to fix prices, the government will file charges, because that is illegal. If the grocer becomes too big, antitrust rules may be violated and his chain can't expand. If the grocer were to block customers from buying anywhere else, criminal extortion is charged. If the grocer refuses to pay the employee who clocked in but hid in the storeroom all day, the department of labor makes him pay for the loafing. If the employee is on drugs and falls off the store toilet and breaks his neck, the government makes the store pay. If the employee is disgruntled and puts poison in grocery products to harm customers and bankrupt the store owner- the store gets sued for not knowing the employee was dangerous. The list of double-standard rules here is endless.

At what point does the slave employee become responsible for actually delivering what he is paid for? Responsible for the quality of his own life and decisions, rather than blaming his customer? Become grateful he even has a customer, as the grocer is?

According to your theory- all success beyond making a basic living is some kind of evil. We must not excel, because somehow that has caused someone else to have less. This is like saying the winner of the race has cheated the man who chose not to run, and therefore didn't win. Most losers like to think that way- it's comforting and helps avoid reality and responsibility.

Businesses are NOT social services. They do not exist for the sole benefit of their employees. Employee wages, benefits and potential for a better future all are directly associated with business success. The ONLY way business succeeds is by making their service attractive enough that customers choose to patronize them. If they do that very well- they grow, and become evil by your thinking... and according to those who believe that any level of success beyond their own must have been obtained by treachery and dishonesty, and "just ain't fair". Those people all own rubber rulers and can prove it.

Such people should hock everything they own and go into business for themselves, as soon as possible. They won't succeed, but they will buy one hell of an education that they desperately need.

 

The problem starts when the very basic definition of capitalism is unknown.

cap·i·tal·ism
ˈkapədlˌizəm/
noun

1. an economic and political system in which a country's trade and industry are controlled by private owners for profit, rather than by the state

Yes, both examples you gave are capitalism.

 

Everybody else was also educated by tax payers. They didn't invent the widget, though they had the same opportunity, this why are they owed anything?

 

So, taking that to the end, 100% taxation would be the best system with the most benefits?

 

Marx went wrong when he injected "religion" into his analysis. He wound up defining capitalism as having the goal of increasing the amount of money that one controls. That's the definition of greed and Marx wound up basically saying that capitalists are all greedy. That's the base his entire worldview is based on.

That simply isn't the case. His "excess value" is used to make one's life better, is used to grow supply of units that can be sold thus benefiting the general public, and is used to create jobs for laborers. All good things. Not greed.

 

Government cannot create prosperity. Taxes should only be used to accomplish those functions outlined in the Constitution, Article 1, Section 8. That keeps government out of the economy and lets it work. When government ventures into a "social" goal it only distorts the economy with invariably negative results. Capitalism is based on enlightened *self*-interest, meaning of the individual. As Adam Smith postulated, the combination of all this self-interest result in an invisible hand that guides the economy into providing the most good for the most people. Even bad actors contribute to the invisible hand. When government elite think they can guide the economy in a better manner it never works out well. Never has. Never will!

 

Except there are a multitude of ways of financial manipulation and exploitation that allow firms to sell products at a loss and still stay in business.

Just ask Tesla.

 

Productivity is subject to value judgements that you don't get to control. That's fine by me. Who are you to tell someone he has to value someone more than he values his own son?

Society can come to valid moral outcomes without needing you to impose them on society. When you impose yourself on society as supreme moral leader all your faults are magnified as strongly as your strengths.

 

Government may not create prosperity, but it can catalyze prosperity creation by setting the best conditions. Those conditions include strong property rights, including enforcement of those rights, as well as preventing people from starving, should private sector risk taking fail. That's what I mean with the term "social component" I mentioned above. Man is a social animal and, thus, cannot act in pure self interest. The nature of government reflects this, which is why ALL successful societies have strong social safety networks.

Of course, those who hate to pay taxes want to get rid of the social component. They don't realize that doing so would result in the destruction of society and the economy in the long run.

 

Productivity can be measured with some objectivity. Claiming that someone who is paid more equals they produce more is utterly false.

By your standard, you are saying Paris Hilton is more productive that soldiers who sacrifice everything they have for their country.

 

Again, you don't get to control how other people measure value. The people who throw cash at her are the ones that contribute to her value. You're welcome to think they are out of their minds and I would agree with you, but that doesn't change the fact that they express their value for her more than they do the soldier. The simple fact remains that you can't force them to behave differently.

 

You're right. I don't get to control how other people value things. But I can point out things like how we value soldiers less than janitors.

It's something I love to point out when people try to claim they love the troops.

 

This *is* important but it is not government meddling in the economy.

The government didn't feed hardly anyone during the Great Depression. It was all done by private charities and churches and basically the people themselves.

Man *always* acts in his own self-interest. It's what Maslow's Hierarchy of Need is all about. Nor is the federal government required in order to have strong safety networks. Do you know who was first on the scene after Hurricane Katrina? It wasn't the Natl Guard. It wasn't the Red Cross. It wasn't FEMA.

It was local neighbors and churches from all around the nation. Local churches were housing, clothing, and feeding survivors way ahead of any government help getting there!

We don't want to get rid of the social network. We just want to get government out of it. The government only mucks it up like they do everything else. Like having half the babies born today being covered by Medicaid. Like 50% of households depending on government benefits. *THAT* represents the destruction of society and the economy.

At its base the social net is nothing more than charity. Charity has to have an interpersonal relationship to be productive. Both the giver and the recipient grows in grace from the interplay. It allows people to help each other grow and succeed. It is the origin of the term "networking" that is talked about so much in the working environment today.

Government handing out checks can't do that. For Pete's sake, they don't even do *that* anymore. It's all direct deposit into your bank account or SNAP card! That's not providing a "social" safety net. That's just buying government dependence![/quote]

 

Those are called government subsidies, It has nothing to do with capitalism.

 

It has everything to do with investment.