Capitalism without failure is like religion without sin

[Splitlink]

When the dollar is devalued, many countries get interested in buying US property and corporations. Mercedes bought Chrysler in this way. Well, it must have seemed a good idea at the time . So, even large corporations get it wrong, sometimes. Mercedes dropped a clanger there! Maybe America is interested in selling China some of its junk, as well!

 

[Dispassionate]

I'll go for capitalism any day, but that is because I live in the capitalist part of the world that is worth living in. I visited India a lot in my travels and I do not know, to this day, why that country never went communist. There was so much misery there that I cannot see what they had to lose. Whether we like to hear it, or not, we have been robbing all such countries of their wealth for centuries. That is why capitalism works so well. The US has convinced the world, until now, that the almighty dollar is the only currency worth having and have been selling their debt abroad in return for commodities. Now, the debt is so enormous that the system is toppy.

Anyway, as the passenger on the Titanic said, " We are going down, but I'm going first class"

I follow another saying

" The system's lousy and it deserves to change but.......not just yet"

Split

The robbing part has got absolutely NOTHING to do with capitalism.

 

[Splitlink]

The robbing part has got absolutely NOTHING to do with capitalism.

It SHOULDN'T do and I would like to agree with you but I'm afraid that I don't. Remember that many capitalists profess to be socialists. They, probably correctly, believe that they are financially more capable of making money by appearing to be so.

 

[Rhody Trader]

I actually recently read a book which suggested that Communism is just an extension of Capitalism. The author argued that in Capitalism the focus is on assets and means of production (capital), with a tendency toward monopolies and similar structures where capital is concentrated. Think of the so called robber barons of the early 20th century in the U.S. Communism, where the state controls all capital, is therefore just Capitalism taken to its extreme.

Based on his definitions, the primary mechanism of most Western countries right now is a free market system in which capital is widely distributed and flows relatively freely.

 

[jacinto]

I actually recently read a book which suggested that Communism is just an extension of Capitalism. The author argued that in Capitalism the focus is on assets and means of production (capital), with a tendency toward monopolies and similar structures where capital is concentrated. Think of the so called robber barons of the early 20th century in the U.S. Communism, where the state controls all capital, is therefore just Capitalism taken to its extreme.

Based on his definitions, the primary mechanism of most Western countries right now is a free market system in which capital is widely distributed and flows relatively freely.

not a surprise there. in relatively basic and even in more advanced theoretical economic growth models, solutions are always derived using 2 approaches

a) market solution (using the market interest rate)
b) the central planner solution (using what is called the "social rate of return") (dont ask, its been too long since i went through the theory)

at least in theory, solutions are always the same unless something arises and that is called "market imperfections or market failures" (some people call them externalities).

so, when the market solution yields an outcome that makes society worse off, economists call for an intervention by government to bring a "central planners approach" , and it is in those cases that economists seek government intervention in a free market.

at least that is the dry and objective mathematical economic theory behind economic models that would agree with what you post.

that communism, in practice, differs from the "central planner's approach" is a different discussion.

 

[Splitlink]

I actually recently read a book which suggested that Communism is just an extension of Capitalism. The author argued that in Capitalism the focus is on assets and means of production (capital), with a tendency toward monopolies and similar structures where capital is concentrated. Think of the so called robber barons of the early 20th century in the U.S. Communism, where the state controls all capital, is therefore just Capitalism taken to its extreme.

Based on his definitions, the primary mechanism of most Western countries right now is a free market system in which capital is widely distributed and flows relatively freely.

It seems to me that, because of the desire for power, capital accumulates into a relatively few hands. That is why I criticised it before. Not for what it is, but for what it tends to do. What it tends to do is to suck the wealth away from poorer sectors of the world community and, worse, creates debt and poverty where there was none before.

In fact, the world's problems, today, are between those nations that control the most capital and those that do not, and countries like China and India are struggling like mad to become part of those that control.

Capitalists call it free enterprise. They would, wouldn't they?

 

[Atilla]

not a surprise there. in relatively basic and even in more advanced theoretical economic growth models, solutions are always derived using 2 approaches

a) market solution (using the market interest rate)
b) the central planner solution (using what is called the "social rate of return") (dont ask, its been too long since i went through the theory)

at least in theory, solutions are always the same unless something arises and that is called "market imperfections or market failures" (some people call them externalities).

so, when the market solution yields an outcome that makes society worse off, economists call for an intervention by government to bring a "central planners approach" , and it is in those cases that economists seek government intervention in a free market.

at least that is the dry and objective mathematical economic theory behind economic models that would agree with what you post.

that communism, in practice, differs from the "central planner's approach" is a different discussion.

Jacinto this is spot on imo. Good concise explanation.

FWIW imo - People blur Fascism & Capitalism with Socialism & Communism.

I would say Capitalism and Socialism are quite different. Capitalism deals with 'equity'. Socialism deals with 'equality'.

Fascims and Communism is the same. Each says state is more important than any individual and does what ever it suits it's leaders.

Very difficult to define and compartmentalise each of these topics. Need to write a few volumes first.

 

[jacinto]

Jacinto this is spot on imo. Good concise explanation.

thanks atilla, but just went back to my "theory of economic growth" times it is academic only. i remember my teacher, this dude was a PhD from MIT, and just giving (rather right wing) comments as he demonstrated the mathematical models, saying, "well, you see, capitalism and communism are similar, yet, one focuses on the market and the otherone doesnt.............but he kind of missed the point

in practice, well, kind of applies, but people forget about the "market imperfection or failure" part, and well, kind of explains why marketing people have a reason to exist

ah, by the way, the concept that should be discussed in this thread should be the reason why some economic agents enjoy "economic rents".....(translation for non-economists.....abnormal returns)

 

[Rhody Trader]

ah, by the way, the concept that should be discussed in this thread should be the reason why some economic agents enjoy "economic rents".....(translation for non-economists.....abnormal returns)

And here the discussion comes around to efficiency.

Some agents enjoy such "rents" because there are inefficiencies in the system which they are able to exploit.

 

[Atilla]

And here the discussion comes around to efficiency.

Some agents enjoy such "rents" because there are inefficiencies in the system which they are able to exploit.

Economic rent I wouldn't have classed as inefficiency or abnormal profits.

One can build a case to say it is more to do with economies of scale or returns to risk by being the first.

 

[Dispassionate]

It SHOULDN'T do and I would like to agree with you but I'm afraid that I don't. Remember that many capitalists profess to be socialists. They, probably correctly, believe that they are financially more capable of making money by appearing to be so.

This is due to human nature - it has got nothing to do with capitalism. Just in case you think that changing the system which change human behaviour you will find that history has proved otherwise. So sorry, you've got the wrong cause-effect link there!

 

[Splitlink]

This is due to human nature - it has got nothing to do with capitalism. Just in case you think that changing the system which change human behaviour you will find that history has proved otherwise. So sorry, you've got the wrong cause-effect link there!

Good heavens! Change the system? I'm part of the system! I wish to change nothing, unless it is for better social justice for those for whom I feel sorry---and that, rarely, includes capitalists who are, usually, more able to take care of themselves.

Capitalism is an economic phenomenum which is corrupted by powerful men. The US is a case in point. Communism is another phenomenum which should work but is corrupted by those in power, Russia being a great example.

I am not debating what is good and bad, Just commenting on what is fact and what is fiction. Capitalistism and communism are both economic theories thought up by man, but I have no illusions about either. Both systems are merciless to the poor and weak and benefit the relatively few. I have no answer, myself, just to try and keep my family on the higher part of the heap and to keep climbing while I have the strength to do so.

One thing that my parents taught me and that has stood me in good stead. I eliminated my mortgage as soon as possible and carry no other debt. That keeps me outside of the web.

Split

 

[barjon]

.................... Capitalistism and communism are both economic theories thought up by man, but I have no illusions about either. Both systems are merciless to the poor and weak and benefit the relatively few...................
Split

split

aye, imo all socio economic models (including organised religion) are basically power systems which keep the common herd in check so the "establishment" can enjoy the fruit. When the "establishment" go too far - as they tend to do - it gives the opportunity for a new clique to rouse the common herd and force a "model" change when that clique becomes the new "establishment" and so on.

cheers

jon

 

[Splitlink]

split

aye, imo all socio economic models (including organised religion) are basically power systems which keep the common herd in check so the "establishment" can enjoy the fruit. When the "establishment" go too far - as they tend to do - it gives the opportunity for a new clique to rouse the common herd and force a "model" change when that clique becomes the new "establishment" and so on.

cheers

jon

Agreed. In politics it is a swing from left to right, a continuous pendulum. Talking of swingin', a bit of capitalism, there, doesn't do that any harm!

Split

 

[Atilla]

split

aye, imo all socio economic models (including organised religion) are basically power systems which keep the common herd in check so the "establishment" can enjoy the fruit. When the "establishment" go too far - as they tend to do - it gives the opportunity for a new clique to rouse the common herd and force a "model" change when that clique becomes the new "establishment" and so on.

cheers

jon

I would call this an opportunistic arguement. Religion and politics don't mix and they are not the same. People who use it for power purposes lend them selves to your arguement but this is not always the case.

No matter what one does having a system or a standard simplifies what ever it is that system is applied to.


1. Driving System
If we didn't have the highway code book, when you only have couple of cars on the road the system may not be an issue. When you have a few million the system is a revelation.

2. Political System
If we didn't have politics, how would power and resources be shared out? Anarchy would rule supreme. Perhaps anarchy could be labelled a system also.

3. Religious System
If we didn't have religious systems, how would people know how to conduct them selves with respect to their fellow man and social community they live in? When you have one or two people, may not be an issue but when you have millions it becomes. one.

By the same token having more than one religion becomes an issue as does having multiple political / banking or any other multiple systems.

4. Banking System

5. Accounting System

6. Sports
Even sports have a system and rules which makes the level playing field a more competitive event and more enjoyable imo. People here try and cheat to have an uneven advantage. Just as people who abuse politics, religion the banking system and the rest.

What does stand out is that life is pretty much globally and no doubt universally the same.

They are systems but to call them power systems is only one perspective. On the whole they are voluntary and participation is based on choice and faith.

You can't touch it, smell it, weigh it, see or hear it but in your heart you feel it.

 

[Splitlink]

I would call this an opportunistic arguement. Religion and politics don't mix and they are not the same. People who use it for power purposes lend them selves to your arguement but this is not always the case.

No matter what one does having a system or a standard simplifies what ever it is that system is applied to.


1. Driving System
If we didn't have the highway code book, when you only have couple of cars on the road the system may not be an issue. When you have a few million the system is a revelation.

2. Political System
If we didn't have politics, how would power and resources be shared out? Anarchy would rule supreme. Perhaps anarchy could be labelled a system also.

3. Religious System
If we didn't have religious systems, how would people know how to conduct them selves with respect to their fellow man and social community they live in? When you have one or two people, may not be an issue but when you have millions it becomes. one.

By the same token having more than one religion becomes an issue as does having multiple political / banking or any other multiple systems.

4. Banking System

5. Accounting System

6. Sports
Even sports have a system and rules which makes the level playing field a more competitive event and more enjoyable imo. People here try and cheat to have an uneven advantage. Just as people who abuse politics, religion the banking system and the rest.

What does stand out is that life is pretty much globally and no doubt universally the same.

They are systems but to call them power systems is only one perspective. On the whole they are voluntary and participation is based on choice and faith.

You can't touch it, smell it, weigh it, see or hear it but in your heart you feel it.

Those who create systems are the ones who will enforce that system once created. That's why they created it in the first place. Very few (that I know) who create systems end up at the bottom of the heap. Some, apart from benefitting from it financially, actually end up with knighthoods or in the House of Lords while those in the system struggle to obey the rules. Tony Blair, much as I admire him, is going to end up like that. Putin is going another way, but will go down in Russian history as a hero. That may be so, but they are rich heroes, nevertheless. Even Castro, in Cuba, is on top of his heap. The real genius of creating a system is making the masses believe in it. Some, actually, enjoy being screwed! There are millions of dedicated capitalists and socialists who haven't gained a penny out of their beliefs, but live in hope of a better future. They may not see it, but their children might! However, hope does not buy the baby a new dress. What I advise, as an elderly member of the system, who has seen most of it, even having had to fight the establishment's wars so that they get richer, is to screw the system for what it is worth because, if you are able to, it will,still, be peanuts to those on top of the heap.

To take an example. A recent case of a severely damaged, one could say that he is almost a vegetable, veteran of the Iraq war has been awarded £150,000. His family is going to court. No matter what his final compenstation will be, it will be nothing compared to what the establishment spends in tea parties in a week, of that I am sure.

I realise that I have deviated from what this thread is all about----or have I? Capitalism is a system bent on accumulating wealth. My father bought his house in West Hampstead for £1500. God know what it is worth today, half a million? How did that come about? The good, old, arm of the establishment, inflation. The unions ask for, and get, more wages, the establishment gives it and property and consumer prices are racked up along with it. Everyone is happy, except for those with cash. Those trying to buy a property are back to square one! The establishment is still on top of the heap.

Split

 

[frugi]

3. Religious System
If we didn't have religious systems, how would people know how to conduct them selves with respect to their fellow man and social community they live in? When you have one or two people, may not be an issue but when you have millions it becomes. one.

Hi Atilla,

I don't believe we need the contrived moral imposition of religious systems as evolution supplies us with an inbuilt moral code that helps our genes to replicate. Do not murder for fun, commit adultery, steal porridge from the next cave etc. are helpful and rather obvious edicts to increase survival rate of self and progeny. It may not be as comprehensive as your average biblical list but it provides a sound, time-tested basis, and also fair since every human is likely to carry a similar copy, unlike religious systems which - though many rules are of course shared - are apt to add irrational, counterproductive and self-serving rules too. Also there is uncomfortable conflict between systems which can have nasty effects.

I think people who live in small groups naturally develop their own pragmatic rules to develop what they naturally "feel", without reference to an imaginary absolute morality such as religion demands. The hue of morality is often relative to context, indeed the root of the word is "custom" ... e.g we bury our dead, others leave their giffers to die on ice floes. But both feel they are doing the right thing and this universal sense of morality .. doing the right thing & avoiding doing the wrong one ... must be part of our survival instinct. We simply choose to exercise the same instinct in slightly different ways. From this instinct can stem laws, basis entirely secular.

Okay "must" is arrogant I know - I can't prove it after all - but it makes sense.

Fair enough straight moral relativism has its problems .. pushing it to extremes if it's all a matter of taste and I think murder is a wholesome fun pursuit then I should be free to practice it. Indeed a few nasty people seem to completely lack this evolutionary instinct, or at least quell it with their ravings. But as the minority their (or at least their progeny's) excesses should be curbed by the system, i.e natural selection over time.

I think we'd behave far more decently to each other in the total absence of religious systems.But ofen when people think they are thinking they are merely rearranging their prejudices, myself most definitely included.

 

[Splitlink]

Hi Atilla,


I think we'd behave far more decently to each other in the total absence of religious systems.

That's a difficult one to argue. Without doubt, more bloodshed and corruption has been caused in the name of religion than by anything else. At the same time, I believe that the lack of religious teaching is the cause of most of today's lack of morals. The fact is that although many of today's parents do not believe in God, it has not made them think that

1) they must replace Him with some other moral education. If there is no Final Judgement, what incentive is there to obey any moral code?

2) the Fear of God has not stopped leaders like George Bush from sending so many of his countrymen to kill and be killed abroad. I wonder why that is? He, either thinks that he is doing God's work or he is using religion as another means to incite the masses.

Personally, I do not believe in the genes idea. Our young must be taught the difference between right and wrong.

Split

 

[Atilla]

Hi Atilla,

I don't believe we need the contrived moral imposition of religious systems as evolution supplies us with an inbuilt moral code that helps our genes to replicate. Do not murder for fun, commit adultery, steal porridge from the next cave etc. are helpful and rather obvious edicts to increase survival rate of self and progeny. It may not be as comprehensive as your average biblical list but it provides a sound, time-tested basis, and also fair since every human is likely to carry a similar copy, unlike religious systems which are apt to add irrational, counterproductive and self-serving rules on a whim. Also there is uncomfortable conflict between systems.

As Emile Durkheim pointed out there is a physical and social aspect to man. Without reigion to discipline the social you would be left with the physical which is take what ever you can to live and exist. I beg to differ about your optimistic expectations with the absence of religion. This physical aspect of man (greed, lust, power) even with religion often supercedes social morality.

People who live in small groups naturally develop their own pragmatic rules to develop what they naturally "feel", without reference to an imaginary absolute morality such as religion demands. The hue of morality is often relative to context, indeed the root of the word is "custom" ... e.g we bury our dead, others leave their giffers to die on ice floes. But both feel they are doing the right thing and this universal sense of morality .. doing the right thing & avoiding doing the wrong one ... must be part of our survival instinct. We simply choose to exercise the same instinct in slightly different ways. From this instinct can stem laws, basis entirely secular.

Yes true but is it the right one. Is it optimal. People in different continents all aspire or have some yearning towards Godliness. Mell Gibsons film comes to mind about the Aztec's and human sacrifice. Please the Gods but in which way. Whilst I agree a high priest wouldn't sacrifice him self (which supports Barjon's and Karl Marx's theory about religion being the opium of people to keep them in their place) it also points out to what levels we can sink to in our pursuit of the faith in the absence of devine intervention.

Okay "must" is arrogant I know - I can't prove it after all - but it makes sense.

Fair enough straight moral relativism has its problems .. pushing it to extremes if it's all a matter of taste and I think murder is a wholesome fun pursuit then I should be free to practice it. Indeed a few nasty people seem to completely lack this evolutionary instinct, or at least quell it with their ravings. But as the minority their (or at least their progeny's) excesses should be curbed by the system.

I think we'd behave far more decently to each other in the total absence of religious systems.But ofen when people think they are thinking they are merely rearranging their prejudices, myself most definitely included.

My main point below in previous blogs is that IT REALLY DOESN'T MATTER WHAT THE SYSTEM IS (which is what I was trying to say) as long as:

• It is communicated to the people
• Applied equally to the people (eg. If high priest had a chance of being picked for sacrifice he would soon change the system for the better)
• Regulated by the people

Man's greed - I doubt will allow any system to obtain it's true valuel.

Lord of the Rings and the one ring comes to mind. Is there any one man who can carry all that power without being possessed by it all? I don't think so

 

[Atilla]

Those who create systems are the ones who will enforce that system once created. That's why they created it in the first place. Very few (that I know) who create systems end up at the bottom of the heap. Some, apart from benefitting from it financially, actually end up with knighthoods or in the House of Lords while those in the system struggle to obey the rules. Tony Blair, much as I admire him, is going to end up like that. Putin is going another way, but will go down in Russian history as a hero. That may be so, but they are rich heroes, nevertheless. Even Castro, in Cuba, is on top of his heap. The real genius of creating a system is making the masses believe in it. Some, actually, enjoy being screwed! There are millions of dedicated capitalists and socialists who haven't gained a penny out of their beliefs, but live in hope of a better future. They may not see it, but their children might! However, hope does not buy the baby a new dress. What I advise, as an elderly member of the system, who has seen most of it, even having had to fight the establishment's wars so that they get richer, is to screw the system for what it is worth because, if you are able to, it will,still, be peanuts to those on top of the heap.

To take an example. A recent case of a severely damaged, one could say that he is almost a vegetable, veteran of the Iraq war has been awarded £150,000. His family is going to court. No matter what his final compenstation will be, it will be nothing compared to what the establishment spends in tea parties in a week, of that I am sure.

I realise that I have deviated from what this thread is all about----or have I? Capitalism is a system bent on accumulating wealth. My father bought his house in West Hampstead for £1500. God know what it is worth today, half a million? How did that come about? The good, old, arm of the establishment, inflation. The unions ask for, and get, more wages, the establishment gives it and property and consumer prices are racked up along with it. Everyone is happy, except for those with cash. Those trying to buy a property are back to square one! The establishment is still on top of the heap.

Split

I think Michael Jackson's tonsils was worth more than $10m at one point in time and he always sounded like he was wearing tight nylon pants.

The army looks after it's own and those who join up are literally up for it! They know the risks?

I am playing devil's advocate but that's what it comes to when you analyse capitalism and defending that freedom.

Same thing in the US when US marines come back with missing limbs. They were left in some old hospital with no care until some journalist got hold of a story. Bush makes an announcement and the whole thing dissapears along with the journalist who moves on to a new story - ie. Blanket news coverage on Iraq or the Government moves against your circulation.

Capitalism at it's best as endorsed by the White House...