- Capitalism and Alternatives -

State owned factories are simply corporate welfare on max . . .

Posted by: DonS ( USA ) on August 02, 1999 at 11:53:31:

In Reply to: An explanation of my last point posted by Samuel Day Fassbinder on July 29, 1999 at 13:01:02:

: : Rather than create healthy economies, say Andor and Summers, through mechanisms that were obviously then available in the post-Soviet economies of eastern Europe, the Market Maoists rushed forward with fire-sale privatization and created destitute ones, merely because such privatization was ideologically mandated.

Don: The following suggests that the privatization was economically mandated:

: SDF: The state-capitalist regimes of eastern Europe had a huge number of assets (factories etc.) that weren't performing competitively under the corporate-capitalist regimes of competition. To preserve these assets, to keep them performing for their governments insofar as they fulfill real human needs, should have been a priority. Instead, these assets were sold cheaply to private entities which closed them down, creating huge reservoirs of unemployed:

Don: What "human needs" did these factories fulfill, other than providing employment? Would people in these countries choose goods produced in state factories over those produced in capitalist factories?

Even more so than in Western economies unemployment in the East is simply irrational. Trapped in immobility, the unemployed rapidly become unemployable and a danger to themselves and others. Freed from the pressure to privatize at any price, remaining state-owned enterprises should be given operational incentives which take into account the social costs and benefits of employment.
p. 184

Don: The "operational incentives" mentioned above must be taken from someone--namely, taxpayers who are the productive mombers of society. State owned factories are simply corporate welfare on max . . .

: Thus people, factories, and whole countries were discarded and left to rot simply because, under the ideological regimes (both state and private) of Market Maoism, they couldn't produce an immediate profit for their new owners.

Don: Ideological regimes? Sounds like economics to me. These state factories couldn't compete? They sound pathetic! I presume they had existing infrastrucure in place. They should have had a head start!

: More profit-worthy, apparently, were the crime syndicates heartily endorsed by the Market Maoists of eastern Europe.

Don: Any hard evidence of this?

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