- Capitalism and Alternatives -

The hat is tipped.

Posted by: Dr. Cruel on October 20, 1999 at 00:59:07:

In Reply to: Mises (1881-1973), Thanx and a hat tip! posted by Frenchy on October 19, 1999 at 18:19:57:

Nice to see someone here who is considered a decidedly capitalist supporter. Also good to see you’ve survived the purge.

Now, to give you some grief (in the form of a commentary):

: 'Competitors aim at excellence and pre-eminence in accomplishments within a system of mutual cooperation.

Competitors aim at success. A cheetah wants to catch and eat a gazelle; the gazelle strives to avoid this eventuality. So also, the businessman wishes to accumulate wealth, the consumer to get the goods. Excellence, or even trade, is only incidental to this dynamic. So also, competition is only spuriously connected to excellence. If I can beat my competitor through skullduggery more cheaply than by producing superior quality products, that’s what I’ll do (barring ethics, itself a dynamic subject to competitive influences).

Competition does seem to favor an increase in excellence, however.

:The function of competition is to assign to every member of a social system that position in which he can best serve the whole of society and all its members. It is a method for selecting the most able man for each performance...

Actually, what it does is allow people the niche best suited for their survival/prosperity. This is, after all, the whole point of ‘competing’ in the first place. If that niche happens to be professional murder, or bank robbery, then that niche will most eagerly be filled.

: The pricing process is a social process. It is consummated by an interaction of all members of the society. All collaborate and cooperate, each in the particular role he has chosen for himself in the framework of the division of labor.

Optimally, this is of course what happens. Optimally, socialism is supposed to do the same thing. The reason that capitalism succeeds so much better than socialism is that, in actual practice, it bears up better. Basically, that is because it can better punish ‘cheaters’, by more directly relating social displeasure with an economic response (i.e., if I sell substandard products, or engage in anti-social behaviors, I will be punished via a medium that allows for a quantification for that reaction - namely, money. So also, the reverse; if I make indispensable goods, or am overly charismatic, I will be rewarded proportionately. This contrasts with socialism, where the educated elite decide such things - a task which they have proved themselves ill-suited for).

Competing in cooperation and cooperating in competition all people are instrumental in bringing about the result, viz., the price structure of the market, the allocation of the factors of production to the various lines of want-satisfaction, and the determination of the share of each individual.'

If you see competition as ‘capitalism’, and cooperation as ‘socialism’, you start to approach my point - namely, that to get to a socialistic system (mutual trust and cooperation), you must first have an economic environment where those who invest in business enterprises and ventures feel comfortable, and in which profits and accumulated wealth are not arbitrarily seized simply by virtue of their de facto existence (a regulated competition, with established rules that are enforced equitably for all parties concerned).

I would have thought the success of Western-style societies would have made this all empirically plain, but I have found some who can be found to disagree with even this claim. Thus the debate, I suppose.



P.S. Thank you for your little bits of trivia. They certainly seemed to have enlivened the place up.

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