- Capitalism and Alternatives -

I don't believe anyone in the US goes hungry because of capitalism.

Posted by: DonS ( USA ) on July 21, 1999 at 13:03:23:

In Reply to: Notes on capitalist system posted by Samuel Day Fassbinder on July 20, 1999 at 18:17:52:

: : (Don): In capitalism, production mirrors demand. The consumers determine production, in other words. This to me seems like the optimum system.

: SDF: No it doesn't. Under capitalism, production gropes after EFFECTIVE DEMAND. Effective demand is the sum amount of money sent chasing after a product. It isn't the consumers who determine production, production begs the MONEY of the consumers. An important example: 800 million people on Planet Earth today may grope after food, and millions of US people too (in case we're all in for another incantation of the stalinist bogeyman), yet these people have no effect upon the production of food, even though they may have important nutritional demands that aren't being met, since they exhibit no sufficient EFFECTIVE DEMAND (i.e. they don't have enough money) to meet those needs.

Don: Wow, 2 years ago my wife and me were below the poverty line. I never went without food, though. I don't believe anyone in the US goes hungry because of capitalism. There might be some people with mental problems who can't feed themselves and fall through the cracks, but this would happen in any system.

Don: Neither the US nor capitalism is responsible for starving people in the Third World. We produce plenty of food--as seen in Ethiopia, the local governments would rather use food and starvation as a means of controlling the local population. I still remember the Soviet ships carrying arms which offloaded their cargo while ships carrying food from the US sat in the harbor because of the socialist government.

: What's more, capitalism suffers from periodic crises of overproduction -- since capitalist production is managed by businesses in constant competition, each business produces more than its clientele can possibly buy in order to undercut competing businesses -- a lower price can result in an increased market share and, eventually, in market domination. Thus businesses overproduce, and the problem of the insufficiency of effective demand that we can see in the world hunger situation exists in other commodities as well, as commodities decay in warehouses waiting for sufficient money to command their sale. This would explain, for instance, the replacement of the family farm in the US with the corporate farm -- family farms weren't producing sufficient amounts of the commodity, food, to command an adequate price to meet their overhead costs in a market characterized by overcompetition and glut, even though they may have been producing enough for everyone to eat.

Don: Small family farms featured low production and considerable overhead. More efficient means replaced them, which would not have happened in a socialist society, which would fail to produce a sufficient supply of food . . .

: Capitalism furthermore requires producers to CREATE all sorts of false needs, through the processes of product advertising, fraud, etc., so that everyone can make money selling something even though not everything that is made is really beneficial to consumers. The effective demand may cater to consumers by first making said consumers into suckers. Look for instance at the economy of cigarettes, a harmful and eventually fatal product that generated billions of dollars for their manufacturers through these very same mechanisms. Only by the most perverse standard, can we say this was done "for" consumers.

Don: It seems to me that it is the consumers who should decide what they want, not you. Smoking originated with the American Indian, who provided it to early white explorers, who introduced it to the Old World. It was not originated by advitisers and company CEOs. People have know the risks of smoking for a long time, and still they choose to smoke. In fact, people who smoke tend to think the risk is greater than it is: about 20% of people who smoke die of causes that may have been a result of smoking.

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