- Capitalism and Alternatives -

Oh, but it is!

Posted by: Asarulaim on July 01, 1999 at 16:02:07:

In Reply to: sounds fun posted by Gee on June 30, 1999 at 13:15:07:

: And people wonder why there is wasteful speculation and market 'corrections' ala 1920s. It favours the capital that belongs to the cronies involved in instituting these protective regimes (at the cost spread out over everyone - a federal reserve special!).

You are very wrong here Gee. The boom-bust cycle is not the result of the Federal Reserve, it is inherent within the nature of capitalism. The United States alone went through three crisises (or depressions as we now call them) in the later half of the 19th centurty alone and this was when there was no central bank in America. Except for the great depression (which was global n nature hence not the fault of the Federal reserve- although they did little to alleviateit and much to prolong it) the boom and busts iof the 20th century have been relatively mild. Hence, the federal Reserve vcan be said to have exerted a strong anticyclical tendency in the market, although by its very independant nature it prefers to favor fighhting inflation than promoting economic growth.

: Ageism, sexism and racism all in one? I hope not. We are talking factual accounts not insinuations? We are accepting that the vast majority of old white guys will simply not fit the mold and that the age, whiteness and maleness is not the key indicator any more than the blackness is an indicator in South Central LA crime?

Just a little rhetoric, but you're right; it was an ad hominen.

: You have recently chastised 'capitalist pig' for his 'static pot' notion of wealth and correctly asserted that wealth is created and grows. This re-allocation of capital - regardless of moral issues - would have to be a 'profitable' one in the sense that capital be allowed to grow - lest you invite stangnancy and decay.

What is profit Gee? Is it teh same as productivity? I can speculate in the Global currency markets, make a killing, and yet contribute nothing to increase productivity or real wealth. Meanwhile teh government can spend 100s of millions of dollars on roads and other infrastructure and not show a pennyfor it. Who is contributing more to the wealth of society, the speculator or the builder of roads? I query you this, would it be better for the government to make the roads profitable or simply wasteful?

Profit is not teh same as productivity. The increase in productivity and actual physical goods are the measure of a country's wealth, not its profits or how much gold is in the treasury. Since profits and productivity are two different things it is possible for the two to collide. Hence even the most conservative of economists understand that the profit motive is an unreliable element for social progress at best.

: Paid for by whom? What if they dont want to pay for it?

Its called taxes. If you don't pay your taxes you go to jail. I'm afrid you fail to see the logic of the arguement: public goods should be paid for and provided by the public.

Besides what should society do with those who can't succeed or prosper in a market system? What do we do with losers, physically disabled, mentally incompetent, victims of racism, sexism, etc.; what do we do with the Willy Lomans (Death of a Salesman reference)?

The measure of a society is not just the product of its greatest members, cultural and scientific achievements, but how it treats the worst among us in society. Should we simple burden the respective families, if they have any, with their problems or should we try a more systemic approach to the problem and not wash our hands on the "tough luck" cliche.

Some say it takes a village to raise a child, well I ask you what should we do with the village idiot?

:Also beware of just having a 'universal' system of somekind. you could have a rotten univeral education system which produces little learning, or a rotten universal welfare system which produces dependants rather than a safety net. Universal shouldnt be the aim, quality should be (note I am utterly disregarding the fact that I would oppose it, and just trying to pick over it as invited)

There is nothing inherent in the definition of the term "universal" that precludes it from providing quality care. For example, public education has been provided by the stae for centuries around the world, with varying success. It's simply a matter of funding, structure, cultural commitment to education, etc. that determines the quality of a nations education. The US spends little, relative to GDP, on education, covers fewer topics, pays teachers less and accords them less respect. Furthermore, the US has a pronounced distrust of academia and intellectuals embedded in its culture. Hence, it is easy to see why education will be poorer in America than say in Europe, and worse if you're poor or a minority in America. This is not to say that there are not good schools in America, but there are certain pervasive influences in America that undermines that tendency.

: Do they? then why would the president make it illegal for current Medicare patients to privately contract with their doctors? Afraid of people voting with their feet? i wouldnt place to much faith in national health care systems

They have provided care to millions of Americans who would otherwise be denied it. That is an achievement in itself.

: I think you might get some argument from RD over this - as its just more of ther same, and its money based.

Is that Red Deathy? No I didn't get it from him, I got it from economic's text books.

:Also it assumes that people will carry on working just as hard with less reward. We may not 'care' if a CEO has his pay slashed, but we may care if engineers, doctors, software writers and the huge amount of 'middle class' earners - who would need to bear the greatest burden - become demotivated and start to move to more tax friendly countries.

This smells like the laffer curve and supply side economics again. Sigh, get off it Gee! It didn't work when Reagan tried it in America and it didn't work when Thatcher tried it in the UK. The desire to work and the desire for more net money is very hard to suppress. For example, in America clinton has raised the top backet by about 7-9% (I can't remember which) yet Americanms are on average workingmore hours then ever before. The work week has jumped from around 40 to 47.8 hours a week!

:Also, using the argument that companies pay all tax
I used no such arguement.

:(is the salary that attracts an employee is the net salary) and this would simply push costs up, reduce profits and result in closures and very slow growth (or falls) which you have pointed to as bad.

That is unless the government takes that money and spends it on public goods that inhance our productivity and grow our real economy. Blowing cash on independant counsils and nukes, of course, fail to that either. Then again blowing cash on advertising also fails to contribute to our real economy either. Regardless, even if the government simply redisitributes money, there will still be no decrease in economic growth on the macroeconomic level, only a decrease in the reate of groth in the private sector.

: Basically, unless just about everyone agrees to this it will fail.

It has happened before and it will happen again.

: Again, it requires the voluntary support to pay for it, or people get kinda pissed off over the whole thing. Im glad you recognise that the rail system is owned defacto by regulators.

There merely needs to be a democratic consensus. I am a democratic socialist, unlike that scientific socialist dude. Regardless, there doesn't have to be universal agreement, just a simple majority

: Or medicine, or safety technology, or communication, or housing, or foods, or recreations and entertainment etc etc.

I am glad you see my point here.

:Also the learning about the universe whilst utterly fascinating - is of questionable value to mankind.

Knowledge is the one thing that separates humans from all other animals Gee. To say that knowledge is of questionable value invites stark criticism.

:Personally I love such science! But I dont reserve the right to make my neighbour contribute to it.

We all benefit from basic scientific research in so many ways it is practically impossible to calculate. Hence, not contributing to further scientific research is equivalent to being a free rider. Hence since science and technology are in many ways public goods, they should be funded by the public also.

: I think you'd find them (companies) moving elsewhere rather than 'being a good boy' and doing what theyre told. Ofcourse you could just seize their assets and hope to make use of them just like those highly unsuccessful state economies of N Kores, old USSR etc.

That's why I use the term gradually. We take them by surprise an d only take a few of them. Nationlization of industries has worked in some places and failed in others. This last part is open to issues of pragmatism; if nationalizing a certain industry would prove to be ineffective then try something else!

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