Capitalism: the cause of and solution to all life's problems

[rotting bones]

I get your point... But we were talking about the cost of defending the environment.

Thank you! You are the first person to say that you see a relationship between the following points:

The way I see it, the problem is that if businesses start taking losses, too many of them will stop paying their workforce and shut down. The wealthy will be relatively okay with their saved cash, but the poor will be miserable. That is the specific bill that the poor are unwilling to pay.

The jobs are created by vote, not profitability.

The pointless adversarialism was driving me crazy.

Leaving economy aside, switching to a zero-carbon economy is not trivial: it will require plenty of hard work, or technological advances or both.
This will directly affect people's lives and standards of living, no matter what economic system you're using.

Someone will have to build the commuter rail lines, for instance, and this time and labor spent that will not be used for other projects.

Switching to socialism doesn't make that change any easier.

Considering the temptation to cut costs: some producers are, blandly, better than others. Some people are better farmers than others. Others just happen to be unlucky. If some farm produces less than another and as a result total production is lower than what people wanted... Well, someone will look into that. Generally people don't like to be seen as a poor producer (with the negative consequences that entails). So poor producers will cut corners whenever possible. Depending on how dire the consequences are (bankruptcy, reassignment to Siberia), unlucky producers will cut corners too.
This, again, is an issue under capitalism or socialism.

One point: Whether cost is a bad thing depends on its definition. For example, a requirement for more workers could mean more jobs. More jobs are bad for accumulators of capital, but good for workers and seekers of employment. Of course, if food production goes down at the same time, that is bad news for everybody. If the earth heats up, we should start farming the far north ASAP.

[rotting bones]

I'm talking positive economics, which is about describing reality rather than making suggestions or proposals of what to do. The only goal have in this point of conversation is to describe how mainstream economists think logistical systems work, perhaps mixed with my own observations here and there. Whether maximising capital for everyone, maximising a specific group or individual's capital, or even just prducing large quantities of cheese is a goal of the designer of an economic system, there is an underlying logic that applies to all systems.

I think all non-physical categories are posited with an end goal in mind. What you're calling positive economics (BTW I'm not 100% positive what work you're referring to because you denied my request for resources) uncritically imports its categories from economists who had end goals like maximizing total social capital in mind. But I could be wrong. Show me resources, an argument against the alternative to the desert island scenario I posted, etc.

To briefly go into normative economics, which is about proposal and policy, capitalism is better than a command economy, whether dictatorial or democratic, because it uses measurement of value as a signal for how to handle distribution, which while not always being ideal for every situation is better than setting fixed values by vote because it is responsive to the internal mechanisms of logistical systems.

And I'm saying that is not true for several reasons:

1. Under capitalism, demand is disproportionally skewed towards the interests of the wealthy. Demand is expressed by spending wealth, and wealth is owned by the rich.

2. Jobs only grow if investors think the corresponding investments are profitable.

...

I have posted these arguments many, many times in Ephemera. I posted concrete examples of irrational allocations of resources from a social standpoint like overworked employees. I have recently argued that these problems hamstring the environmentalist movement.

Feel free to address any of this.

[Travis B.]

To briefly go into normative economics, which is about proposal and policy, capitalism is better than a command economy, whether dictatorial or democratic, because it uses measurement of value as a signal for how to handle distribution, which while not always being ideal for every situation is better than setting fixed values by vote because it is responsive to the internal mechanisms of logistical systems.

You confuse capitalism with market economies as, after all, capitalist enterprises are characterized by an authoritarian rather than democratic structure internally, and one can have non-capitalist enterprises within a market economy, e.g. worker co-ops.

That said, as has been discussed here, markets do a poor job by their very nature of managing externalities. This is where some form of government is needed, in order to regulate enterprises and the market. Just going by the historical record, though, democratic governments do a better job of managing these than authoritarian ones (e.g. when one contrasts capitalist democracies with authoritarian state capitalist states).

[Ares Land]

One point: Whether cost is a bad thing depends on its definition. For example, a requirement for more workers could mean more jobs. More jobs are bad for accumulators of capital, but good for workers and seekers of employment. Of course, if food production goes down at the same time, that is bad news for everybody. If the earth heats up, we should start farming the far north ASAP.

It can go both ways; either resources are diverted to fixing a situation that could have been diverted elsewhere, or it gets extra economic growth. It all depends, I think, on whether the situation you end with is better than the pre-crisis one.

(In a way, I think at least some countries will come out ahead of the environmental crisis, if only because of the technological spin-offs.)

[mèþru]

I'm saying regardless of whether a command economy is democratic or dicatorial capitalism tends to outperform. Is uppose I should specifically state I meant market economies without fixed prices - I am including co-ops and not including "state capitalism" (typing that term is weird, to me state capitalism isn't capitalism). From my personal persepective, co-ops are capitalist but I forgot I was using Marxian definitions rather than my own, and co-ops are certainly not capitalist by Marxian defs.

Yes, markets are bad at managing externalities. This is why in a crisis increasing government intervention is important, and patly implementing a command economy as a temporary measure is the best solution in some crises. But the nature of the crisis and the way that command economies resolve it is that decisions are made by experts - democratic management would suffer the same pitfalls as free market response, such as a lack of co-ordination and not enough focus on short-term demand. Command economy does have some positives, and mixing it with free market generally creates a more productive economy than either alone. In addition I personally suspect that the command economy of early Ghana was vital in building up a strong enough nation to later be able to compete in international markets after economic liberalisation.

Could you send me resources on this?

Perhaps some other day, I'll make a note to look for some.

And I'm saying that is not true for several reasons:

1. Under capitalism, demand is disproportionally skewed towards the interests of the wealthy. Demand is expressed by spending wealth, and wealth is owned by the rich.

2. Jobs only grow if investors think the corresponding investments are profitable.

Addressing number one would take really long and not be relevant to where I think the conversation is going right now, but maybe I'lll come back to this later.
Number two though applies to all logistical systems where the agents are sentient entities. Unless if the job is unpaid labour or someone is paid as a favour or as charity, but even then those are also kinds of profit in maximising utility even if they don't lead to monetary gain. Doing something because you feel god while doing it is maximising utility, and thus profitable. Everything people consciously do either provides utility for themselves or for others they care about.

[mèþru]

I do not think jobs are in themselves a good thing. I think it is better to ensure in general that people have resources than that they work, especially if their work is both redundant and not what they want to do in life. Automation is a bad thing because the structure of society is that people not born into great wealth need to work to live well, but that is more a fault in the status quo than automation being intrisically bad (well there are other problems with automation but that's not really an economics topic)
Currently, the world is not so productive that everyone can work in whatever they want or that everyone who doesn't want to work doesn't have to. But it already is so productive in some specific places and industries that more people working there would in fact lower efficiency. The problem is not then that these people cannot get so and so job, but that without the job there is an insufficient safety net to sustain them until they find an alternative income.

[Moose-tache]

I've said this before, but I think it is one of the stupidest ironies of our current economic system that having robots produce infinite free resources would cause most of us to starve to death. I think more automation is generally a good thing. It only causes a problem because it accelerates the consequences of private ownership of the means of production.

"Won't the owner need laborers?" - Nope. Robots.
"But the owner will need customers to buy their widgets!" - Why? They only sold the widgets to buy things that other owners were making, or buy more labor to buy more things. The labor is out of the picture now. Owners can just trade from their infinite stockpiles, or own robots that make all things simultaneously.
"Wait. Unemployment will make labor cheaper!" - Good luck outcompeting a robot that works ten times faster than you, ten times better, and ten times cheaper. And that's only this year's model.
"We can simply vote to force the owners to give us what we need." - Nope. That's Socialism. We've seen in this thread that anything that smells like Socialism is doomed.
"Can we at least vote for-" - Let me stop you there. You're only alive because your former boss is giving you hand outs. Do you really want to piss him off?
"Gosh, maybe it wasn't such a good idea to let the world belong to only some of us, for no reason other than they say it does." - Yeah, but at least we don't have to worry about being stuck in a dead-end job!

As for the value of work itself, the two camps tend to argue over whether greater abundance will allow us focus on things we find more important, or distance us from any feeling of meaningful contribution. Both have their flaws. Abundance has created way more white-collar jobs, but most of them are just as terrible as turnip farming or whatever we did with our time before that. On the other hand, nobody ever left turnip farming and regretted it.

[Ares Land]

I do not think jobs are in themselves a good thing. I think it is better to ensure in general that people have resources than that they work, especially if their work is both redundant and not what they want to do in life.

I don't entirely agree with that. There are social and psychological aspects (people don't take well to the idea of being dependant or useless, and doing useful work is essential for self-worth).
Besides, holding a job allows you to pick up useful skills, to build up a professional network, or simply to be felt as more trustworthy by potential employers. All of these are net benefits for workers and society.
And finally, unemployment turns the job market into a buyer's market, with all the consequences in terms of wage and work conditions that implies.

Mass unemployment is a downward spiral and seems dreadfully persistent over time if you let it go on.

[Raphael]

I've said this before, but I think it is one of the stupidest ironies of our current economic system that having robots produce infinite free resources would cause most of us to starve to death.

This. This. This.

[rotting bones]

mèþru: I'm still feeling high that I got people to agree with me on things, so I'll restrict myself to brief comments.

Capitalist "outperformance" is pointless because most of the wealth it generates just sits there and does nothing to help workers. Capitalism stops outperforming to the extent that you tax the wealth it generates. This can be gotten around by exploiting workers, natural resources, the third world, etc.

Regarding number two, that's true in a sense, but irrelevant in this context. Under capitalism, when jobs aren't created, workers suffer.

Demand for more jobs is a bad thing, but only under socialism. Not in an economy with jobs like this: https://www.youtube.com/watch?v=Hl_Ew0c4T9g where demand increases the bargaining power and wages of workers. It is when progressives say that more jobs are bad that workers feel they are out of touch. Yes, bad either in a worker's utopia or for rich people!

[mèþru]

I completely agree with Moose-tache, and alleviating it under a market framework, regardless of capitalist or not, would require redistribution to a scale never seen before in history. Although as things stand now, the US economy is not even big enough to afford government giving every adult citizen $12,000 a year - it would take about three trillion dollars, which is also about the same size as the average year's total budget

people don't take well to the idea of being dependant or useless, and doing useful work is essential for self-worth

I think that these attitudes are toxic. It's punishing people who already can't find useful work or are unable to do such work. It's punishing people who create or entertain. It's punishing people in the disabled community who don't have a choice in being dependant.

I do think people should be required to at some point in their lives learn useful skills, especially as electrical can fail and people should have back-up systems and knowledge on how to use them.

Most importantly, redundancy and unemployment are inevitably progressing even without automation - other technological advances keep making fewer people necessary to run things. The buyer's market of employment is already the situation my generation is facing when it comes to skilled jobs. People are increasingly turning to gig economy and making patreons for their hobbies as means of survival. The need to support the unemployed and self-employed is already here - employment is just not a realistic option unless if people go luddite.

[mèþru]

I hate the whole "the workers are the people" thing. I know many people who are just unemployable regardless of system due to disability. I already am shut of many jobs before I can even apply due to my disabilities. The paradise should be for the people, regardless of if they work! My value should not be merely my economic value.

[Raphael]

I hate the whole "the workers are the people" thing. I know many people who are just unemployable regardless of system due to disability. I already am shut of many jobs before I can even apply due to my disabilities. The paradise should be for the people, regardless of if they work! My value should not be merely my economic value.

I agree, and would add that, in addition to being unjust and unethical, that mindset is also politically self-defeating. In terms of politics, it means basically telling large parts of the population "I don't want your support!". And then, people with that kind of attitude get all surprised when they hardly ever get anywhere near actual political power.

[rotting bones]

Your value is not your economic value. There should be state support for people who can't work for medical reasons. The work credits are there for the standard meritocratic reasons: to make people work harder, give them a sense of achievement, reward effort, etc, not to punish those who can't work. BTW I have said all this before.

[mèþru]

I view that in the same way I view the argument of some right-wingers that diasbled people should separately be provided for but no one else receive welfare - you are still stigmatising, even if unintentionally, not working and disabled people will be socially resented for this.

[rotting bones]

Everyone whose output is low for medical reasons should receive state support. (I said this before too BTW.) The elderly shouldn't have to work at all. If treating disabled people differently in any way is stigmatizing them, then I can't help you.

PS. Remember, this assumes that generally, anyone who seeks employment can find a position and they're not inhumanely underpaid.

[mèþru]

Then I would be very strongly opposed to your system, for the sake of myself and my friends.

BTW Money already is a work credit. Plenty of research shows that people don't get much of a sense of acheivement in things they aren't intrinsically interested. And giving the best rewards to the people who work the hardest encourages people to overwork themselves.

[zompist]

I've said this before, but I think it is one of the stupidest ironies of our current economic system that having robots produce infinite free resources would cause most of us to starve to death. I think more automation is generally a good thing. It only causes a problem because it accelerates the consequences of private ownership of the means of production.

Curiously, I just found a pamphlet from one Mustacius, writing in the year 1815, complaining about "steam-machines, cotton gins, spinning-jennies and suchlike Contraptions." It points out that these infernal machines would put 90% of the "labouring population" out of work. "Rather than supporting the whole of nineteen millions as they now gloriously do, our British Isles could not bear more than two millions of labourers."

I'm as suspicious of what we optimistically call Late Capitalism as you are— but the 19th century version was arguably worse. And yet somehow Mustacius's vision was wrong. Those isles now support 70 million people, very few of whom have to shovel manure for a living. (Cue standard joke about "You call having Boris as PM living?")

Of course Mustacius's near-contemporary Malthus was right when it came to Ireland— but that was egregious colonial mismanagement; Ireland was purposely and methodically excluded from modern development.

I'm not as convinced that robots will produce "infinite free resources" as you are, nor that automation, er, automatically makes jobs disappear. Even with Covid, unemployment is at 7% here— it was 3.5% in February. Where it gets scarily higher, it's not due to automation, it's due to the pandemic or, in 2008, to other ills of capitalism (deregulation, the housing bubble).

But yeah, plutocracy is bad, it really is, and things just do not go well when productivity gains go to the top 10% and not to everyone. It actually is possible for a capitalist system to benefit everyone, and spectacularly so: cf. 1940–1970. But our voters got tired of Rooseveltian liberalism and ushered in the plutocrats instead.

The good news, though, is that we don't even have to nationalize all industry. We just nationalize the robots.

Oscar Wilde may turn out to be more prescient than Marx. Machines may finally be advanced enough to implement his vision: support everyone in style without coercion of any kind, and let them work on what pleases them.

[rotting bones]

zompist: I don't know. Industrial robots are already here AIUI.

mèþru: This is more meaningless hyper-progressivism. Let me just point out the irony. I am not disabled, and I am volunteering to support people who are. You are shut out of many jobs, and you oppose this proposal on behalf of people who aren't. Maybe you should consider the possibility that you don't have very deep insight into the psychology of the average worker.

[mèþru]

I'm opposing it based on how it will effect me and my friends. Good intentions towards a community does not translate to good results.

I do think automation will make jobs disappear. Already the employment market for my generation looks smaller than my parents'. A lot of people are responding by doing freelance work or self-employment, but that generally makes them worse off.

I don't think it is good to nationalise the robots, as that essentially puts most of the economic power of a country directly under the government.

I do think that a system should make work as optional as possible for living a decent life. Most people will want to work, but those who don't should be allowed to pursue what they want even if nobody wants to buy it. Currently production is not efficient enough to ensure everyone who doesn't want a job can live a middle class life with children and a spouse who also doesn't work, but I think we can make sure everyone who doesn't want a job and everyone who wants a job but can't get one is living outside of poverty.