Ludwig von Mises, in “Liberalism”, Chapter II, said:
“What is always criticized in the capitalist system is the fact that the owners of the means of production occupy a preferential position. They can live without working. If one views the social order from an individualistic standpoint, one must see in this a serious shortcoming of capitalism. Why should one man be better off than another?”
Is this an attempt to resurrect the Marxist theory of exploitation? The idea that even if a person is willing to put themself in financial bondage for a future payoff - they are unworthy of the profits they make even if it’s due to time preference?
So? Is the goal of capitalism for all of us to toil for the rest of our days, or is it to allow us to produce with such ease that we may all spend our lives in leisure? As we make our inexorable advance towards the latter, we should celebrate those few who have reached this end before us and be happy that they maintain such a position by financing the very means that pull the rest of us a little closer to them.
One of the wonders of the free market is that its only possible form is that of the first man up the hill reaching back to help pull up those behind him, so that they may climb the hill with more ease than he.
But whoever considers things, not from the standpoint of individual persons, but from that of the whole social order, will find that the owners of property can preserve their agreeable position solely on condition that they perform a service indispensable for society.
"perform a service indispensable for society." A contradiction of own Mises (among others contracditions of this author). If an man not works, what service indispensable this man perform for society?
The owners of the means of production who can “live without working” can only do so because they successfully speculated on what means of production to own in the first place, which speculation is valuable to society. Of course, nobody but a government parasite “lives without working”, this is just an appeal to old world sentiments regarding the “monied class” which supposedly just sipped tea and ate crumpets while watching their 10,000 pounds a year just magically roll in. Of course, to the extent that the monied class becomes a successful lobbyist of the redistributionist state and expropriates the wealth of the public through plunder of the tax revenues to subsidize its “businesses”, this is accurate. It’s just that it’s a sweeping generalization to lump in any business owner - even those who actually profit or go broke by dint of the patronage of their customers alone - with the rent-seeking mercantile class.
Clayton -
Marlen, your whole argument reminds me of a discussion I had with someone who could not figure out why profiting from stock trading is justified; they recieve profit for placing money and resources into companies that put it to the best economic use - thus they are rewarded when they can sell the stock at a higher price. The higher price reflects the new wealth produced by the company in question.
Here you ignore that taking the time to spend an immense amount of money and not have the ability to use it until you get return on the investment is itself a productive activity. To illustrate this, let me ask you the following: Would you be willing to save up $100,000 in order to buy a small neighborhood carwash and then not get the money back until a decade later?
This whole line of thinking breaks down when you look at it from day 1 rather than halfway through
Sure if you look at the present state of affairs and ask: Why does he deserve to be the owner of the capital and get returns from it?
The relevant question is: How did he obtain the capital?
The service he has provided and for which he deserves to be paid is foregoing consumption of consumer goods equal in value to the capital goods.
Good for them. So what?
Now that’s a new low. Mises was so stupid, you explain, that he contradicted himself ONE SENTENCE AFTER his first statement.
The fault, dear Brutus, in not in Mises, but in ourselves, that we understand not.
for what its worth…
empirically, leisure time appears to decrease as income increases. that is likely because these days the road to wealth is to accumulate human capital instead of physical capital.
for what its worth…
empirically, leisure time appears to decrease as income increases. that is likely because these days the road to wealth is to accumulate human capital instead of physical capital
Interesting. I didn’t see any reference or graph as to how and when the trend started. Is it possible this could have something to do with the less than stellar economic growth this decade?
The arguments of liberals serve to justify slavery. Imagine the owners slaves arguing their “time-preference” to purchase a slave and that the slavery is productive activity. And reading the arguments of apologists of slavery at the age, is possible see that they argued nearly so.
Speculate in Stock Exchange is not productive. A man as Carlos Slim, man more rich of Mexico, second man more rich of world, not know nor the basic of informatics, need that an employeer to check their stock prices, because he not know working with computer, but to working in their enterprise need have a level of qualification that he (Slim) no has.
Are you kidding. Its the reason we have stable long term prices that reflect scarcity.
I don’t follow this. No one here justifies slavery. Certainly Mises did not justify slavery.
Absolutely it is. How else will capital be allocated?
Right, so he hires people to manage his money well for him. Experts. How is this a problem?
maybe. you mean that maybe rising underemployment is appearing as increases in “leisure time”? that certainly could be an alternative explaination. I haven’t seen a rigorous assessment of the issue. but you raise a good point.
Yeah, and that may be why the rich are working longer or compartavily more stagnant hours. I was hoping there was a way to look at the 90’s.
I did not said that you justifies slavery, nor that Mises justified. Read more or you not know interpret. That I said is that yours arguments serve to justify slavery.
How you believe that produced before previously stock exchange? In time of Soviet Union, not existed stock exchange, but russians lived better that in present.
Without Slim, the production continues, but with Slim, without skilled workers, not exists production because the labor that the skilled workes makes, Slim not makes. And oftentimes, Slim need hire a mat perit to help them it in their business. As he not know, he not know on technology, to invest in technology, he need of skilled workers to help them it how to manage their investiments.
People can justify anything with anything else. It doesn’t mean that is my argument.
Are you kidding me? Under the Soviet Union, millions of russians were slaughtered by their own government, and most lived in perpetual poverty. The only way the Soviets could feed their people was with grain supplied by the capitalist west.
But slim has the capital to employ the workers. Without his capital investment, how will they receive their wages? There is no wage for consumption until the work is completed and sold.
Sure, he needs skilled workers. Everyone needs skilled workers. The rich man and the poor man.
Yours arguments serve to justify slavery. For example, you argues that “Without his capital investment, how will they receive their wages?”, imagine apologists of slavery arguing: without the Lord, how feed the slave?
Wage class exist as class. This is the problem. The dependence relation with capitalists. One man decides all, and the workers have to obey. If enterpreneur unemployed, and the worker know if continue receiving the wage, because is completely dependent to decisions of bosses, and can at any time, lose their job. Is necessary change this. Whom works and produce that have to decide the things, as Soviets.
What you considers “perpetual poverty”? The russians lived better in Soviet Union that today. Life expectancy was better. According to polls, the majority of russians are with nostalgia of time of Soviet Union. The same happens in East Germany.