Why communism will work, and capitalism won’t.

Economics Economics Questions
121

Fair enough, we have profit & loss. But you misunderstand the roll of the entrepreneur. The skill of the entrepreneur is to employ resources to satisfy the consumers. He must employ them efficiently in order to satisfy the demand of the consumers. If he does, he gains “profit”, if he does not, he suffers losses. All exchange with the entrepreneur is done on a voluntary basis. He hires the Engineer as an engineer and not as an entrepreneur. If the Engineer wanted to be an entrepreneur, he would try to earn his living as an entrepreneur and not as an engineer. Perhaps the engineer is ambitious and wants to be both. He can strive to be whatever he wishes, but he cannot force himself on others. He does not have a right to be an engineer, others must seek his service. He does not have a right to be an entrepreneur either; others must seek that service also. This is the whole point of a market economy: to produce the things that public wants. To direct the capital (funded by savings) into the proper lines of production that best satisfies the consumers. The law of supply and demand cannot be tempered with by involuntary means if we are to have a society that creates wealth. ##################

What exactly is your complaint? That the reward of the entrepreneur be distributed among all those who have already previously reached an agreement with the entrepreneur on the value of the exchange of their service? If this is what the engineer is looking for, then he is looking to be an entrepreneur. He could seek such an agreement with some business owner, but like you said, he would risk his income, just as any other entrepreneur. He would not work for a relatively secured salary agreed ahead of time, but for a share of the profit. Fine, but this is all legitimate business for free people in a free society to voluntarily conduct among themselves. I think you fail to realize that such a system based on voluntary exchange yields free market economy.

Because all workers are voluntarily selling their services on a free market. The value of their service is supply & demand. You claim you recognize the truth of scarcity. Very well, then you cannot argue that the value of goods and services can be determined by anything else other then the free market. That is, by how much individuals value your service. by how much they are willing to pay you, or forgo something else, for the benefit of your service. The values are subjective. All wages cannot be determined arbitrarily by some democratic process. They are determined by the consumers! What you fail to realize is that the market economy is nothing but a collection of voluntary exchanges, each between two parties. The bigger the economy, or the more complex, the more exchanges there are. All prices, including wages are determined by the consumers! profits (or losses) are determined by consumers! ###### Yes the boss wants to pay as low as possible, but so does the employee want to get as much as possible. Once again, SCARCITY! Labor is scarce. It is no different then tomatoes. You want to buy tomatoes as cheaply as possible, but the seller want to charge as much as possible. Entrepreneurs are competing for human labor just as they are competing for capital goods. Wages rise when there is an increase in demand, and should fall when there is a decrease in demand. Unlike capital goods, human labor cannot increase in quantity by means of better production processes or technological advancements (which all, by the way, require savings of the capitalists which you detest so much). This is why wages actually increase on NET as the economy grows, while the prices of consumer goods can fall. We all become wealthier. There is no exploitation in a free market economy.

The 40 to 1 is a meaningless assertion that proves nothing, so I don’t even care if it is true or not. Starving people in our age is a tragedy! The nations of starving people have no Capitalism. They reject it. They don’t understand the cause of their misery. The cause of their poverty is not the success of others. Wealth in a free market economy is created, not expropriated! If you want to abolish proverty, then you want as many capitalists and entrepreneurs to exist in those nations. They will exist, but you must stop rejecting free market capitalism.

122

According to whom? To you? Lets suppose they are underpaid, the problem isn’t they are underpaid, rather it’s whether or not they themselves realize they are underpaid. But there’s entirely a good chance that they know this and find other factors mitigate the lower wage (A safer job, more regular hours, benefits, and etc). In essence, what you perceive as exploitation for them may not be exploitation. The nature of the subjectivity is largely due to the fact that there are internal factors (and even external ones) which are unseen and probably will never be seen. As such, your analysis of the situation itself will never be wholly objective or capable of accurately handling the situation as such. Or in simpler terms: you only see the crest of the wave, but not the forces underneath that drive it.

That’s supposing a boss isn’t doing anything meaningful. Lets understand that the classical models of the firm are fundamentally wrong. Yes, wrong. Capital isn’t homogenuous. Labor isn’t homogenuous. And so on. Heterogeinty is the norm, rather than the exception in the nature of the firm. As such, a boss, or entrepreneur’s purpose is to analysis all the factors involved in production and bring them into the optimal (or rather next to optimal) configuration. Thus, a “boss” or entrepreneur is no more exploitative than the shrewd chess player that uses whatever pieces he’s been given. But more interestingly is that the relationship of the entrepreneur to the laborer is one that is complementing as the laborer knows more in terms of his specific job compared to the entrepreneur who knows more in terms of the whole of the approach for which that job is being undertaken.

123

Ok. Now your task is to prove that it’s capitalism and not mercantilism/interventionism/socialism which causes it. Good luck. Then you have to show that “fairness” is what you actually work for, and that exploitation happens, and all the rest. Good luck.

Oh, and you’ll have to prove that we’re all our brothers’ keeper. Good luck, kid.

124

Oh please. The labor theory of value has been refuted to death. At least get to the 1880s and the marginal revolution, will ya? If not, please refrain from spouting economic gibberish.

125

Not really, and since money was banned on pain of death, “anarchic Spain” didn’t fare so well.

126

“the country enjoyed a measure of prosperity and pay rises”

Benefits of a higher wage.. Hell, what are the benefits of being payed for your labor at all? Let’s just be slaves. Take a factory, an owner sits in his office and most likely manages the distribution of the products. Now I’m sure any worker can pick up a phone and call a store and arrange a deal, the owner reaps an insane amount of undeserved profit. Without the workers there is no business. The same cannot be said about the owner.

Renting yourself to another human is no different then being owned by another human.

Unacceptable working hours.

I don’t see how private property contradicts with “collective ownership of the means of production”

127

Higher wage != more wealth that can be bought. Otherwise, I could print myself a gazillion ladyattis bucks and buy out the planet.

128

Pay? Not with money. It was banned.

And no–not any worker can call and arrange a deal. You clearly have zero knowledge of what it takes to run a business. I’m going to ask this question sincerely and honestly: are you not yet out of high school?

129

And what’s ridiculous is claiming that trade is artificial. For it to be artificial, it must be FORCED.

130

Not that this is a complete argument against your point, but it’s demonstratably untrue that workers can do exactly what management does.

Again, not an argument, I frankly don’t care if they could because the entire concept behind communism is old and worn. It’s a new century. A new millenia. Let’s try something different.

131

You can buy stuff. So are saying that if workers were paid more, then they would buy able to buy more stuff? How would the factory owner be able to stuff is he doesnt make a profit and, thus, has no money to buy stuff?

Not one that is mute. Btw, so you admit that an owner can a be a woker?

What is considered an “insane amount of undeserved profit”?

So ownership and renting are the same? So, if rent a house, does that mean that I also own it?

What are “unacceptable working hours”?

So an individual in a socialist society can own a factory?

132

Can I get a response to this?

Value is subjective. Anyway, what is wrong with the owner making a profit if the worker agreed to do the work at the given price? Also, the price at which the owner sells the product is not directly determined by the costs. The price is directly determined by supply and demand. Furthermore, if a worker produces a shirt for $2, and then the factory owner sells the shirt for $1, should the worker return $1 to the factory owner? Afterall, the worker was paid more than what the shirt was valued. Lastly, you are ignoring time preference.

133

Because there is no non-exploitative alternative. It is silly to suggest such a situation because such a situation will never happen.

It’s damn near impossible to read your posts..

Why can’t an entrepreneur be replaced with the collective? Yes these exchanges between worker and owner are made on a voluntary basis but there is no non-exploitative, practical alternative for workers. No, the whole point of a capitalist economy is profit for the owners of the means of production. If the whole point of a market economy was to meet society’s demands then there would be no poverty, when there are people with so much capital they don’t know what to do with it and there are children dying of starvation, you cannot say that capitalism’s function is to meet the consumer’s (society’s) needs. Wages would not be chosen democratically, they would not be chosen at all like an owner chooses a wage for a worker. Yes the worker wants the most he can get as does the owner that’s is where the question of who deserves it more. The person who actually produces it or the person who owns it. The owner cannot own the product if it was not produced therefore, the worker deserves to be paid in full for his labor.

Wages would be decided by how much you produce not a democratic vote. Wealth is created for the business owners, the minority. Wealth is expropriated from the workers, the majority of society because they are not payed for what they produce. So it creates wealth for the minority of society while expropriates wealth from the majority of society. There is no exploitation in a free market society? So there is no profit for an owner?

Oh yeah those stupid Africans rejecting capitalism. They sure were pretty accepting of British capitalism and look where that got them! Look at all the entrepreneurs that existed then. But you know what they need to do? Become entrepreneurs! Yes, it solves everything!

134

Source..

Then what does a factory boss do, that justifies worker exploitation.

135

The workers aren’t going to be paid for what they produce in a capitalist business so it’s a pointless question. The day the workers are paid for what they produce is the day that the owner is replaced with democratic ownership.

I’m sure an owner could perform a factory job.

Undeserved profit is any profit reaped through worker exploitation.

I was speaking in terms of it being natural or not. Renting yourself is just as unnatural as selling yourself.

That is to be determined by the workers.

Yes an individual can own a factory as long as exploitation does not occur just as an individual can own a tooth brush because there is no exploitation or coercion.

136

Again, what is wrong with exploitation?

Are you saying that producers never sell their products below cost?

What’s wrong with that?

For clarification: what is your definition of capitalism? Also, look at what the attempted-socialism did in Russia. People starved to death! Look at what is happening in China now. The Chinese can eat meat!

Even if what you wrote made any sense, cannot a worker agree to get paid less than the “full value”? Or must he be forced to receive the “full value”?

What are you talking about? The workers produce goods using the owners resources. How can you expropriate something you own?

What the hell are you talking about? “British capitalism” wasn’t free-market capitalism. You do understand the difference, right? You do understand that we are supporting free-market capitalism, not fascism, right?

137

So in order to have “democratic ownership” you must steal the property of the rightful owner?

What the hell is democratic ownership anyway?

Hahaha…

Oh I see, you can have property… as long as you don’t employ anyone or create new capital with it. Sure, that makes sense.

138

That money was banned in anarchic spain? http://wiki.infoshop.org/Anarchism_in_Spain#1936_Revolution

Infoshop, if you didn’t know, is run by a communist who likes to masquerade as an anarchist.

FIrst you must prove that exploitation exists. And remember: the LTV has been refuted.

139

Democracy fails in politics, and fails much more in economics. Democracy can’t establish a rational economic order, and it leaves the door open for the mob rule. It is based on collectivism, egalitarian ideas, which oppresses the individual and endangers minorities. Maybe you should read more about economics, as I find that the “leftists” common denominator is their ignorance about economics facts. Maybe you are willing to sacrifice economic progress for a more egalitarian society; we don’t. There’s still too much poverty in the world (and not caused by capitalism and economic inegalitarianism) to embrace your ideas.

140

It puts wealth in the hands of the undeserving.

No, I’m saying that such a situation will never happen in a wage system.

A minority’s well being should not be put in front of everyone’s well being.

My definition of capitalism: A market system based on free enterprise while the means of production are privately owned. You speak of the failed socialism in Russia. How about the failed capitalism in Africa or South and Central America? Now I know you are going to complain and say it’s not real capitalism, well it is. Their economic system is a market economy which is based on free enterprise and private ownership of the means of production.

Yeah, I just reread it I left some words and punctuation out. Realistically the worker would not want to take less than full value, it’s a meaningless question.

The owner’s resources that the owner purchased through worker exploitation. The worker’s essentially payed for the resources.

Yes I do understand the difference. You can’t blame the people of Africa that were exploited by colonial capitalism for not accepting free market capitalism because the very people that benefit from our current capitalism don’t want free market capitalism.