NationStates Jolt Archive

Okay. Capitalism seems to be the best system, or at least a lot of people have that opinion. On the other hand, every now and then, Capitalism seems to have a little recession or depression, which causes it to undergo major repairs. In addition to that, Capitalism tends to exploit the majority of the human race while benefitting only a select few. My question and challenge is what system should replace Capitalism, and if it should be replaced?

Wikipedia article of economic systems
http://en.wikipedia.org/wiki/Economic_system

No economic system can ever entirely solve negligence and the delegation of responsibility on the part of the masses. "Capitalism" inordinately "benefits only a select few", and has to "undergo major repairs", because the masses let it get to that point. Feel free to "change" to whatever "system" you want, it will do you little good in the long run.
With that in mind, I would recommend the "less negligence, more responsibility on the part of the masses" "economic" system.

In addition to that, Capitalism tends to exploit the majority of the human race while benefitting only a select few.


Yah, 'cos its all people in stove pipe hats abusing scullery maids, shoving 9 year old boys up chimneys, and running over mill workers in their phaetons.

Oh wait, no it isn't.

Seriously though, the problem is corruption. Big social safety nets, liberal social attitudes, acknowledgment that some functions are better served by the public sector. None of those are antithetical to free market capitalism and strong property rights. (Something that the US sorely lacks).

Every so often though people forget that the world is full of corrupt little shits. Now the market can adjust to corrupt private entities, because there is such a thing as market discipline, but it can't deal with a government that is both interventionist and corrupt. Basically, the root of most of these failures can be laid at the feet of political types. Not the free market per se.

The bottom line though is that in most cases, not all, a free market is the best mechanism for allocating resources. And I don't think anyone seriously argues that there should be no-regulation at all. (Especially in respect of preventing market dominance by one player).

No economic system can ever entirely solve negligence and the delegation of responsibility on the part of the masses. "Capitalism" inordinately "benefits only a select few", and has to "undergo major repairs", because the masses let it get to that point. Feel free to "change" to whatever "system" you want, it will do you little good in the long run.
With that in mind, I would recommend the "less negligence, more responsibility on the part of the masses" "economic" system.

True... though it would be difficult to get everyone to wisen up, but it is possible.

Maybe it's the Abilene paradox?
http://en.wikipedia.org/wiki/Abilene_paradox

Yah, 'cos its all people in stove pipe hats abusing scullery maids, shoving 9 year old boys up chimneys, and running over mill workers in their phaetons.

Oh wait, no it isn't.

Seriously though, the problem is corruption. Big social safety nets, liberal social attitudes, acknowledgment that some functions are better served by the public sector. None of those are antithetical to free market capitalism and strong property rights. (Something that the US sorely lacks).

Every so often though people forget that the world is full of corrupt little shits. Now the market can adjust to corrupt private entities, because there is such a thing as market discipline, but it can't deal with a government that is both interventionist and corrupt. Basically, the root of most of these failures can be laid at the feet of political types. Not the free market per se.

The bottom line though is that in most cases, not all, a free market is the best mechanism for allocating resources. And I don't think anyone seriously argues that there should be no-regulation at all. (Especially in respect of preventing market dominance by one player).

I understand, but your first statement contradicts the fact that a great majority of this world lives off of less than a dollar a day. I'm speaking in global terms and capitalism's effect globally rather than just in the United States.

I'm probably wrong here, because I'm just starting to get an understanding economics.

I understand, but your first statement contradicts the fact that a great majority of this world lives off of less than a dollar a day. I'm speaking in global terms and capitalism's effect globally rather than just in the United States.

I'm probably wrong here, because I'm just starting to get an understanding economics.

Everybody used to live under less than a dollar a day. That's not the fault of free markets. Free markets didn't per se, make those people poor. Evidence indicates the opposite if anything. On the other hand, free market democracy has made a lot of people very very rich. Poor in the US is rich for 2/3rds of the world.

Also most of the world's real poor live in corrupt hell holes that are anything but free market democracies.

Are there abuses? Yes. But again that is really all at the feet of politicians.

Aye, free markets with quite a bit of taxation please. It's swish, we have it in the UK, and it combines the benefits of capitalism and communism pretty nicely. Which is top.

Many people can't get their head around the fact that economics is generally not a zero sum game. If it was then our economies would be the same size as they were hundreds of years ago.

Out of the economic systems my favourite is Georgism.

I like participatory economics. Combine that with a fusion of swiss style democracy and radical Athenian democracy and you have the ideal society.

Much like politics, the best economic systems would likely be the ones that minimize the effects of greed and corruption.

Under reaganomics, for example, the republicans thought that they'd be sending cash to gandhilike executives who'd dutifully pass the cash down to the little people. Instead, the cash went to C. M. Burns (http://en.wikipedia.org/wiki/Montgomery_Burns), and stayed with C. M. Burns.

I understand, but your first statement contradicts the fact that a great majority of this world lives off of less than a dollar a day. I'm speaking in global terms and capitalism's effect globally rather than just in the United States.

It's been the spread of modern, globalized capitalism that has reduced that percentage by more than 50% in only 25 years. If anything, it was the pursuit of first mercantilist, then colonialist, and most recently socialist and autarkic economic systems, with all the corruption and graft they encourage, that have conspired to produce such dire poverty.

Much like politics, the best economic systems would likely be the ones that minimize the effects of greed and corruption.


True free markets automatically minimize the effect of greed and corruption. It's a market discipline type thing.

Capitalism is sabotaged when externalities occur that prevent it from self-correction. The externalities in question are:

1. Government Bailouts to keep some failing businesses from going bust. This is a major one, as it effectively rewards irresponsible behaviours that cripple the system. Capitalism works best without a "Safety Net", because risk is more closely monitored by those responsible for taking it.

2. When Competition is allowed to narrow to the point that one has a Monopoly, or near-monopoly market in place on a vital structural commodity. Examples include Standard Oil, Carnegie Steel, and DeBeers (diamonds). Capitalism's primary benefits (broad prosperity, high-quality production at reduced opportunity cost) only occur in very competitive circumstances. Markets where there are few, or no, competitors tend to stifle innovation, prevent efficiency, increase prices and concentrate wealth in "holding pools" that prevent it from circulating. Antitrust laws are a critical tool in producing effective Capitalism. "Too Big To Fail" generally comes down to "So Big that when it fails, it takes you with it."

It's worth keeping in mind that the free market exists to serve society, not the other way around. Government is necessary to create the terms of the market, and to account for externalities like the environment.

Post-scarcity economies, ftw. Give me Santa machines, Superintelligent AIs, and the ability to warp spacetime.

Post-scarcity economies, ftw. Give me Santa machines, Superintelligent AIs, and the ability to warp spacetime.

How do you expect to motivate people to invent these things? There's a story, and it's apocryphal and maybe less than accurate, but it's got the ring of truth to it.

It seems that Nikola Tesla invented a means to generate and transfer massive amounts of electrical power wirelessly. His experiments were financed by JP Morgan, and as soon as he had a working prototype, Morgan pulled the plug on the money, stating in part that "You can't charge people for this, it's worthless. the system won't pay the cost of building it."

Scarcity provides profit-motive, since the Economics pie is sliced based on it-when there's lots of oil, oil goes down in price unless or until someone tightens supply up to keep the price higher. It's called "Able AND WILLING".

"Able and willing" is why farmers are paid NOT to grow crops-the farming methods of the nineteen seventies were sufficient for the U.S. to have the potential to feed the entire four billion (at the time) humans on planet earth-perpetually. Unfortunately, the farmers themselves would be driven into poverty if they produced that much, since prices would fall to the point that they would be unable to pay for their own needs. This is "Imposed Scarcity" and it was first driven by agrarian issues in the U.S. during the early pre-depression era years (and formed the basis of The Grange-keeping farming profitable enough that farmers could eat too.)

Without scarcity, things have no value, without value, things aren't produced, without production, things become scarce...fun, huh?

Imagine, you found a lump of pure gold a full kilometer wide and 100 kilometers deep-sounds great, doesn't it? Except that that lump of gold would likely drive the price of gold, the Value of it, below the price and value at which it's profitable to cut, pack, and ship it. this is the problem with the idea of eliminating scarcity.

The balance you need is to sit between having ample supplies, and having sufficient demand to make it worth it to HAVE ample supplies.

Anarcho-syndicalism (http://en.wikipedia.org/wiki/Anarcho-syndicalism). The issue is not an issue of markets vs. central planning. The issue that I take with capitalism is the ownership capital and the very real power inequalities that such a class society creates.

If you believe that humans ought to be free, than the only moral choice is the one that doesn't have the majority of the people selling their liberty to those who own capital. A socialist system of worker's self-management is the humane and ethical choice.

Okay. Capitalism seems to be the best system, or at least a lot of people have that opinion.
Which capitalism?

Yah, 'cos its all people in stove pipe hats abusing scullery maids, shoving 9 year old boys up chimneys, and running over mill workers in their phaetons.

Oh wait, no it isn't.
It's about how equal the income distribution is.

Seriously though, the problem is corruption. Big social safety nets, liberal social attitudes, acknowledgment that some functions are better served by the public sector. None of those are antithetical to free market capitalism and strong property rights. (Something that the US sorely lacks).

Note: This is all about intellectual property rights.

They can be antithetical to each other. Social safety nets may need to provide something near base cost, though an intellectual property not being used may hinder the product or raise the price.

Some free markets could also have a problem with strong property rights, with patents and the such being used to create an product monopoly.

Every so often though people forget that the world is full of corrupt little shits. Now the market can adjust to corrupt private entities, because there is such a thing as market discipline, but it can't deal with a government that is both interventionist and corrupt. Basically, the root of most of these failures can be laid at the feet of political types. Not the free market per se.
I think more along the lines that private entities can corrupt the market.

Actually it can be laid at people, who either enter political (or military, beuaracracy) life or enter business (or social/religious lobby) life and try to corrupt the other.

The bottom line though is that in most cases, not all, a free market is the best mechanism for allocating resources. And I don't think anyone seriously argues that there should be no-regulation at all. (Especially in respect of preventing market dominance by one player).
I'd have to disagree with that. The most efficient would be a total planned economy with complete transparency and massive inter-agent knowledge transfers (not that it's possible to make a near-perfect one now).

The major problem with markets is the push towards limiting knowledge between agents and the promotion of developing artificial monopolies. That, and market failures are not nearly as rare as some would want to believe (humans being the creatures they are).

Many people can't get their head around the fact that economics is generally not a zero sum game. If it was then our economies would be the same size as they were hundreds of years ago.

Service capitalism approaches zero-sum, as it doesn't actually produce something, it just facilitates transfer of resources.

Under reaganomics, for example, the republicans thought that they'd be sending cash to gandhilike executives who'd dutifully pass the cash down to the little people. Instead, the cash went to C. M. Burns (http://en.wikipedia.org/wiki/Montgomery_Burns), and stayed with C. M. Burns.
Reagonomics' problem is the money tended to be sent (or passed on) to the hoarders and greedy/corrupt more often, even when it was sent to a relatively benign group.

Okay. Capitalism seems to be the best system, or at least a lot of people have that opinion. On the other hand, every now and then, Capitalism seems to have a little recession or depression, which causes it to undergo major repairs. In addition to that, Capitalism tends to exploit the majority of the human race while benefitting only a select few. My question and challenge is what system should replace Capitalism, and if it should be replaced?

Wikipedia article of economic systems
http://en.wikipedia.org/wiki/Economic_system

Well, depends where you place yourself.
I would like Feudalism back since I'm descendant of a noble family...

Everybody used to live under less than a dollar a day. That's not the fault of free markets. Free markets didn't per se, make those people poor. Evidence indicates the opposite if anything. On the other hand, free market democracy has made a lot of people very very rich. Poor in the US is rich for 2/3rds of the world.

Also most of the world's real poor live in corrupt hell holes that are anything but free market democracies.

Are there abuses? Yes. But again that is really all at the feet of politicians.

The compensation for people living off of a dollar a day in the past was that when it was adjusted for inflation, it was a decent wage. We live in a global economy and to get a decent living you need a fifty times that.

How do you expect to motivate people to invent these things?

Generally there is the thought that there would be a period of time between the inventions of said items and a post-scarcity economy in which the inventors can profit greatly. There is also the fact that they'd be much wealthier in a post scarcity economy than in a scarcity one.

Personally, I think capitalism and globalization is counter-intuitive. I feel that it's up to our little communities, towns, and cities to band together. People need to learn to be self-sufficient and to be self-expressive. Corporate-culture is infringing on our intellectual rights.

Amen, Brother Ascelonia, Amen. As a left-communitarian I agree 100%.

How do you expect to motivate people to invent these things? There's a story, and it's apocryphal and maybe less than accurate, but it's got the ring of truth to it.

It seems that Nikola Tesla invented a means to generate and transfer massive amounts of electrical power wirelessly.What motivated Nikola Tesla to invent that?