Capitalism is fundamentally Flawed(Logically?) Discussion with Rob Huesdens

Economics Political Theory
41

Sadly, I’d have to agree. Too many mouths have been promised entitlement cake that an ever shrinking (and increasingly burdened) productive base is unable to bake – globally. We’ve gone beyond the point of no return (the Event Horizon) and the plunge into the black hole is inevitable. The world increasingly looks like the 1930’s, and we saw what increased state control did for it then. We only differ in our interpretations and hopes: You see the bottom of this black hole as the heavenly “solution”, whereas I hope that we come out the other side with the determination to never strangle the golden goose (producers) again. Hope springs eternal.

I hope we’re both wrong and we could still escape the hole altogether.

42

Did capitalism make capital available to more people, or did it not?

I don’t think it is so black and white. Nowhere in the world did the expansion of capital happen in completely capitalist societies; they happened in mixed economies (but correlation isnt causation). Was this a result of capitalism, the labor movement, and/or state intervention?

Why didn’t this seperation and distinction intensify?

See above

Why is it that we didn’t experience a proletariat revolution?

The New Deal? I am not saying that is true, but is a possible response.

How is it that most people own some forms of capital?

Again, see above. This expansion in capital didn’t happen in completely capitalist systems. We cannot therefore say that capitalism was the sole cause.

and comes to a conclusion that we never see materialize.

So you would say over the last 100 years, civilized society has become more/less socialist?

43

But in what way was capital made available? If it was by market mechanisms then it was done entirely in a capitalist way. Whatever interference brought on by the state, the function of capital accumulation simply had to move around those constraints.

So ultimately it matters not whether the state was in existence or not. In states where we witness the least amount of interference, we likewise were met with the greatest amount of capital accumulation.

Can the new deal be really called a proletariat revolution?

And again thats not relevant. Are you arguing that the expansion in capital occured because of the state? That the state created this expanding capital? Otherwise you’d have to concede that this was materialized on the market.

44

So ultimately it matters not whether the state was in existence or not. In states where we witness the least amount of interference, we likewise were met with the greatest amount of capital accumulation.

As I said, I agree with what you’re saying. But I think you discount the effect the labor movement had (and concurrently state support of the labor movement) in turning workers into capitalists.

Can the new deal be really called a proletariat revolution?

Not in any way, imo. But much like the bailout we just went through, I think it was insurance against a worker’s revolution.

Are you arguing that the expansion in capital occured because of the state? That the state created this expanding capital? Otherwise you’d have to concede that this was materialized on the market.

I think it is rare that the state ever expands capital. I am making the argument that the expansion of capital into the hands of workers, is a product of the labor movement’s ability to fight corporatism.

45

There is no logical distinction between a capitalist and a laborer, as someone above already mentioned. Whats been observed is throughout capital accumulation laborers aquire additional capital of their own. Especially in the case where a country is becoming wealthy over time because of it.

If you continue to believe the false dichotomy of laborer/capitalist as the two being different, then I could see why you and Rob struggle with this.

http://filipspagnoli.wordpress.com/stats-on-human-rights/statistics-on-gross-domestic-product-correlations/

I hate to use GDP as an illustration or bring in empirical studies into the discussion but I think this may be somewhat relevant here.

On a side note, notice how far less of a correlation there is with economic growth and democracy, then there is with general economic freedom. Democracy does not promise economic freedom, it doesn’t make any kind of promises at all really.

46

There is no logical distinction between a capitalist and a laborer, as someone above already mentioned. Whats been observed is throughout capital accumulation laborers aquire additional capital of their own. Especially in the case where a country is becoming wealthy over time because of it.

I think you are mistaking me for someone who totally disagrees with you on this issue. If that is so, you would be mistaken. I make no distinction in theory between a capitalist and a laborer. I make the distinction in practice, as once your capital accumulation reaches a certain point, the amount of labor you need to perform decreases. At this subjective point, you can effectively retire and live solely off the dividends of your capital profit (I had to do these people’s taxes, btw, so I have some hands-on knowledge of this).

I am not on the side of Mr. Heusen, neccesarily. I just think people were discounting the effect the labor movement had on getting capital into the hands of those who would have been solely workers.

47

No offense but even if your system is arbitrary your still trying to make a distinction between different types of individuals. Your performing the exact same error as Rob, even if you don’t agree with him.

I fail to see what doing taxes has anything to do with anything. The fact is many “laboreres” middle incomed individuals receive partial income from investment and other revenue generating avenues. Being capitalist is one of degree, there is no solid line. You can create one in your head like you’ve done, but it’s an arbitrary and as you said “subjective” distinction.

48

No offense but even if your system is arbitrary your still trying to make a distinction between different types of individuals. Your performing the exact same error as Rob, even if you don’t agree with him.

Because in practice, there are sometimes clear differences between a capitalist and a worker (and an entrepreneur for what its worth). John works min wage, owns no stock, has no real capital. Jim, works a decent job, has a retirement acct of stocks, and invests some of his extra money into the market as well. Jerry, maybe was a worker long ago, but now lives solely off the dividends of his stock. Those are clear distinctions.

I fail to see what doing taxes has anything to do with anything.

Just that I know people personally who do not labor for anything, they live solely off divideds (and more power to them :D)

The fact is many “laboreres” middle incomed individuals receive partial income from investment and other revenue generating avenues. Being capitalist is one of degree, there is no solid line. You can create one in your head like you’ve done, but it’s an arbitrary and as you said “subjective” distinction

There is no solid line in theory, but as I stated above, there are sometimes clear cut lines in practice.

49

So you actually believe that without the labor movement there’d be clearly distinct classes of capitalists and workers – the former firmly holding the latter hostage by the “Work for me as much as I tell you and get paid whatever I wish to pay you, or DIE!!” exploitation gig? Please tell me it isn’t so.

50

So you actually believe that without the labor movement there’d be clearly distinct classes of capitalists and workers – the former firmly holding the latter hostage by the “Work for me as much as I tell you and get paid whatever I wish to pay you, or DIE!!” exploitation gig? Please tell me it isn’t so

I don’t think it is quite that simple. I thought I made that clear in my post. Perhaps I mistated my position. I don’t hold that we would be capitalist vs worker if not for the labor movement. I don’t think anyone could hold that position because we did have a labor movement, and there is more capital in the hands of workers. I clearly stated that correlation is not causation… hmm perhaps you misunderstood me.

My position is that you cannot attribute that many workers are partial capitalists, solely to capitalism. It did not happen in a solely capitialist society (that has not existed on any wide-scale in the history of mankind). This discounts that the labor movement had been fighting for this for many decades.

I hold the view that were it not for the labor movement we would be much more of a corporatist society than we are now, and probably even less of a capitalist society (if you hold the position that corporatism != capitalism).

51

So the labor movement saved capitalism from corporatism?

52

Again your committing the same fallacy in attempting to categorization people as if this were a taxonomy class. The whole concept of classes is silly. Being a capitalist is not one of passive individual categorization. Being a capitalist implies an action or behavior, just like being a runner. It’s something you do, not something you are. It would be more appropriate to say people “play” capitalism or people go “capitalizing” as in a verb.

The distinction between laborer and capitalist is not so “black and white” as you argue. But instead works both ways at the same time .A current capitalist could stop being a capitalist at any time, likewise a laborer is almost always playing capitalism in some way. Furthermore there is no barrier to entry in being a capitalist. There is no private club you need permission in joining. People make capitalist decisions in their calculations on a daily basis. Whether to spend or to save ect…

You argue that a minimum wage poor person is not a capitalist. But to call him laborer or capitalist is entirely meaningless. If those terms are to represent the persons economic activities then using the tag capitalist or laborer equally is fallacious. As an example, the second the low income wage worker begins the practice of saving his income he has stepped over into the world of being a capitalist. At some point he may amass some level of savings to acquire property, like a car. The car is a capital good which improves the productive output of his labor. It expands his options and allows him to voluntarily trade/work with a larger group of individuals. Labor’s productive output comes from the most fundamental form of capital, the body.

Just as a man who wakes up one day and decides to run every morning has become a runner so does a man who decides to save a penny for later employment becomes a capitalist.

53

Giant_Joe wrote:

<<< Open question: Has Marx been right on anything? >>>

Obviously. Like for instance the accumlulation of capital in the hands of fewer people.

Although there have been many things not foreseen by Marx.

Marx wasn’t anywhere explicit about what kind of govt. would be necessary for socialism, he had no blue print for it.

<<< P.S. I’m a worker who owns capital… or a capitalist, maybe. No, wait. I’m an intellectual like Marx, and transcend that whole distinction because I feel like it. >>>

The distinction between the two fades away… A class-less society, in which the distinction between capitalist and worker are being negated, that’s in a sense the ultimate goal of socialism.

54

So the labor movement saved capitalism from corporatism?

That is too black and white, imo. It had a hand in staving off corporatism, but in so doing created socialism. My world has many colors, black and white is just too simple.

A current capitalist could stop being a capitalist at any time, likewise a laborer is almost always playing capitalism in some way.

but he cannot just stop being a laborer, only a capitalist can get food with no labor involved by himself. That capitalist can still choose to be a laborer, but he does not have to. Make no mistake, I think the vast majority of people are capitalist, that is natural to desire. I am just saying, a pure laborer (these are people that really exist, tho the line is tenous) has no choice but to work because all meaningful land currently is owned by either private or public entities.

It would be more appropriate to say people “play” capitalism or people go “capitalizing” as in a verb.

I like that. That is a good way of putting it.

Just as a man who wakes up one day and decides to run every morning has become a runner so does a man who decides to save a penny for later employment becomes a capitalist.

Ha, another good one.

But saving is not as easy you imply (ignorance plays a large part in this), hence the public demand for cheap credit and high wages. Even in a pure free market this will hold true (barring some dramatic change in the way people think; less work, more things [imo the prime mover of technological advancement]). I think I remember something from Adam Smith about colonization that would fit in here (that having colonies alows the non-landowners the ability to own land or something) that can help to alleviate this problem.

Either way, I am not arguing against capitalism or the OP’s position. Just stating that a pure laboring, non-landowner doesn’t really have much choice in deciding whether to work for someone else or not. If he is some gifted entrepreneur, he may find a way. If he has help from friends and family, he may find a way. But nothing naturally says he will ever be able to practice capitalism.

55

And this is a problem? The uncomfortable fact that one must move a finger lest he dies? I too have to get up, open my fridge and get something to eat, as food is not likely to jump into my mouth on its own. Let’s belabor this horrid state of nature, too, shall we?

Isn’t all food currently owned by either private or public entities, too?

If others (already!? ) own something you need, perhaps you could purchase or rent/borrow it from them? Just an idea.

56

And this is a problem? The uncomfortable fact that one must move a finger lest he dies? I too have to get up, open my fridge and get something to eat, as food is not likely to jump into my mouth on its own. Let’s belabor this horrid state of nature, too, shall we?

I thought I had typed “for others” in there. A pure laborer could choose to stop laboring for others if he owned his own farmable land, or other piece of capital. But there is nowhere to efficiently homestead anymore, a man with no capital (be it physical or social) cannot become a capitalist if his “wages” do not meet his and/or his families caloric needs.

If others (already!? ) own something you need, perhaps you could purchase or rent/borrow it from them? Just an idea.

Your hostility and willingness to misrepresent my positions is not helpful to anyone but yourself friend. Let us come to a mutually beneficial conclusion and show the strength of the market of ideas!

If he is some gifted entrepreneur, he may find a way. If he has help from friends and family, he may find a way. But nothing naturally says he will ever be able to practice capitalism.

57

Really? There’s not a square inch available on this whole planet today that someone with no capital (but his own hands) could farm and pay the owner a % of the harvest sold? How about fishing off a Costa Rican village? Or hunting? Or would these qualify under “too entrepreneurial” for your model laborer?

Finally, if a capitalist was brutally underpaying and mistreating the laborer (who, let’s assume had no options but to work for someone else, and is under the impression that he deserved better), would there be no other capitalist who would recognize the laborer’s self-perceived value and bid him away by remunerating him accordingly? If no such capitalist existed, what does that say about the laborer’s perception of his worth to others?

58

I just thought I’d add a little side note here – my world has many colors, true and false is just too simple for me.

If a man does not work he does not eat. Is that too complex? It’s been true for the entire existence of argicultural history long before industrial, organized society.

Even so, the axiom exists with or without society. A man can beat the ground all he wants, demanding that it bring forth sustenance, as if his existence creates a claim on the earth to provide him with the necessities of life.

I repeat the formula again: Beat earth, shake tree equals three course dinner and a nice shelter.

59

I won’t argue if you keep misrepresennting my positions. Notice the word “effeciently.” Is the laborer supposed to walk to Costa Rica?

Finally, if a capitalist was brutally underpaying and mistreating the laborer (who, let’s assume had no options but to work for someone else, and is under the impression that he deserved better), would there be no other capitalist who would recognize the laborer’s self-perceived value and bid him away by remunerating him accordingly? If no such capitalist existed, what does that say about the laborer’s perception of his worth to others?

The scarecrow wants a brain, eh? Straw men serve noone the better. Perhaps there is another employer, whose working conditions are just as deplorable. The argument isn’t whether he can work for a capitalist to become a capitalist.. of course he could. My argument is that he has no choice but to work for an outside employer as there is no efficient land for him to homestead.

Hostility will not bring me to your position, no mutually beneficial outcome will come from it. Let us move above petty differences.

60

‘My argument is that he has no choice but to work for an outside employer as there is no efficient land for him to homestead.’

Well the third world is still in development and has unowned land. Surely you realize that there are tradeoffs in making choices. Opportunity costs. You may say ’ Yes there is land there but it is not good land or it is not surrounded by developed society’ such is the trade off though.