Why not Socialism?

[dj43]

You vote against the people in power if you don't like them or you do a recall election or a voter initiative. If Microsoft becomes the only software maker what happens if you don't like their product?

The theory is fine but that is not what is happening.

Gerrymandering has made it virtually impossible to get rid of a politician you don't like. The party in power draws the lines to make sure their party will STAY in power. Hence, lacking term limits, it just about takes a plane crash to get rid of someone.

Arnold is a VERY rare exception in example of recall. Davis was the only governor EVER to be recalled, IIRC, and that cost the state million$$$ to get rid of the bum.

Initiatives do work to a degree but they are incredibly expensive to stage and are nothing more than a working example of a failed system of representatives.

On the other hand, I have yet to see any business with such a total monopoly that I couldn't get what I want. I don't have to buy Microsoft. There are plenty of other products out there. Larry Ellison has become a serious challenger with Oracle/Peoplesoft. Apple is now stronger than ever. Lots of choices out there despite all the moaning about Microsoft.

No, the market works a lot better than the government in providing balance, IMO.

[Bob Morocco]

On the other hand, I have yet to see any business with such a total monopoly that I couldn't get what I want. I don't have to buy Microsoft. There are plenty of other products out there. Larry Ellison has become a serious challenger with Oracle/Peoplesoft. Apple is now stronger than ever. Lots of choices out there despite all the moaning about Microsoft.

No, the market works a lot better than the government in providing balance, IMO.

Without government interference Microsoft would be much more powerful than it is now. I haven't read Upton Sinclair's "The Jungle" but that would be an example of the market run amok. An assumption of a free market is that consumers are informed as to which is the best choice to make. The problem is that corporations actively try to missinform already ignorant consumers, it's called advertising. Companies have found that if they get people to buy more of a product than they need then companies make more money. Does the market provide for environmental protections or workers' rights or consumer protection?

[argentine soccer fan]

If Government doesn't control the huge amounts of money than who does? Large corporations who have a vested interest in staying large corporations and in getting even larger. There must be a balance because if the government doesn't have enough power then Large corporations will exploit people, form monopolies, and crush inovation.

Individuals should control most of the money. Ideally most of the economy should be in the hands of small business. Yes, like you I am troubled by the power of large corporations, but I fear big government even more.

Corporations can only force their will on us indirectly, by advertising or ironically, by attempting to influence big government. But big government can force us directly to do things, and at some point it becomes impossible to control. All in all, I will rather take my chances trying to outsmart misleading advertising than having to deal with corrupt government agents.

[96Squig]

Common, if you want to play games (other than Blizzard) on your PC you do have to buy Microsoft's OS...

[ratdog]

Blitzz,

I'm pressed for time this morning and the missus and I are going out of town for the weekend tonight so I can't respond in depth until Monday. Until then, I can only dash off these notes:

Singapore and HK (and Britain, the US, Japan, etc., for that matter) did not become properous by following "free market" methods. They were able to tolerate the delieterious effects of "free market" ideology only AFTER they'd already become prosperous enough. Or they simply mouthed free market platitudes from the comfortable position of owning an empire.

Second, the historical record (and not just in Asia) suggests that capitalism fares best under the following conditions:

1) a more or less mild secular form of fascism

2) a British crown colony with a near monopoly on trade with a nation that has:

a) the world's largest population

b) a huge ethnic overseas diaspora

Of course, number two shows just how futile it is to make sweeping economic generalizations from the experience of Hong Kong.


Back in the 19th century, the people whose descendents would become the most Republican people in the country practiced socialism for a time. It didn't work either.


By this argument I can say that since all the early American utopians were also religious communities that failed, no possible form of (western) religion can succeed and we should all turn our churches, mosques, and synagogues (and, in Utah, tabernacles, I guess) into wicked awesome condo buildings.

I generally don't have much time for orthodox Marxism, but I think Marx hisself was onto something when he postulated that you cannot jump from a realtively primitive form of technological level and social organization directly into industrial socialism, especally when you are surrounded by capitalism. Also, I could argue that early attempts at capitalism were generally not successful until the social conditions were ripe for the falling away of feudalism. This partly explains why "revolutionary" attempts to jump start the transition from capitalism to socialism failed. Well, that and the historical accident it was the exactly the least developed areas where revolutions were attempted and most successful.

See you Monday!

[Matt in the Hat]

Dumbest answer ever outside a Keller-ote post.



Well, if you'd answer a simple question instead of cowering in fear of it for two days...

Why is it a dumb answer? becuse it's not yours?

[Matt in the Hat]

You vote against the people in power if you don't like them or you do a recall election or a voter initiative. If Microsoft becomes the only software maker what happens if you don't like their product?

You use Linux?

[argentine soccer fan]

Individuals should control most of the money. Ideally most of the economy should be in the hands of small business.

Hehe. After rereading my post, it sounds like I am clearing my throat and pointing to myself as I say it.

Yes, give all the money to me. I guess I am a bit like Socrates and Plato, when they kept suggesting that the philosophers should be the ones who rule.

:D

[NGV]

Individuals should control most of the money.


Well, according to the World Bank, low income countries have an average central government expenditure of 18% of GDP. For middle income countries, the number is 21%, and for high income countries, it's 30%. In Haiti, central government spending is 10.5% of GDP; in Austria, government spending makes up over 40% of GDP.

Obviously, correlation doesn't even remotely translate into causation in this case, and I'm not claiming that more taxing and spending would solve Haiti's problems. But it's clear that big government is perfectly compatible with high levels of economic development and social welfare, and small government is equally compatible with horrendous poverty. So, maybe we shouldn't place that much emphasis on the amount of money controlled by individuals vs. government; by itself, that factor doesn't seem to tell us much about whether a country will be rich and happy or poor and miserable.
But big government can force us directly to do things, and at some point it becomes impossible to control. All in all, I will rather take my chances trying to outsmart misleading advertising than having to deal with corrupt government agents.
Here, you seem to be equating big government with corrupt and unaccountable government - but in reality, those two things aren't at all equivalent. There are plenty of countries with big governments and minimal corruption problems (Scandinavia comes to mind), and small governments can be extremely corrupt.

[quentinc]

Without government interference Microsoft would be much more powerful than it is now. I haven't read Upton Sinclair's "The Jungle" but that would be an example of the market run amok. An assumption of a free market is that consumers are informed as to which is the best choice to make. The problem is that corporations actively try to missinform already ignorant consumers, it's called advertising. Companies have found that if they get people to buy more of a product than they need then companies make more money. Does the market provide for environmental protections or workers' rights or consumer protection?
While being a good book, "The Jungle" does not have much to do with the market running amok. There is no Microsoft type monopoly. It is used to describe the poor treatment of employees in the meat-packing industry at the turn of the century.

[BenReilly]

Well, according to the World Bank, low income countries have an average central government expenditure of 18% of GDP. For middle income countries, the number is 21%, and for high income countries, it's 30%. In Haiti, central government spending is 10.5% of GDP; in Austria, government spending makes up over 40% of GDP.


That's highly misleading because such a high percentage of low-income countries' GDP is devoted to subsistence and not really taxable (outside of North Korea).

[BenReilly]

Well, if you'd answer a simple question instead of cowering in fear of it for two days...

He probably wanted to avoid a 2-3 day argument with you.

[BenReilly]

Are you saying that the Heritage chart which shows decline in foreign capital invested in the USA is a contradiction of Arthur Laffer's curve? I don't see how it contradicts it. Arthur Laffer's curve is a mathematical fact. The only question we can debate is at what point it begins to turn. If you see a contradiction, please explain.


The Laffable Curve is a complete joke within the context of American fiscal policy. It's VooDoo cubed. It's self-evident that at some point increases in tax rates will result in lower revenues, but we're nowhere near that point. His curve was nothing more than junk economics to support totally irresponsible tax cuts.

[NGV]

That's highly misleading because such a high percentage of low-income countries' GDP is devoted to subsistence and not really taxable (outside of North Korea).

Point taken; that's a fair criticism in regard to very poor countries.

Among developing countries in general, though, there seems to be a decent amount of variation in rates of taxation. For example, just looking at this hemisphere: Brazil takes in 25% of GDP in central government revenue, compared to 14% for Argentina, despite the fact that a much higher percent of the Brazilian population subsists on less than $1 per day. Uruguay's revenue number is also 25%. For Colombia, right next to Brazil in the UN's human development index, the revenue figure is 12.4%. For Jamaica, seven places below Brazil in the rankings, it's 34%. So it's not just levels of poverty that explain those differences.

Or, you could just look at developed countries. If you go down the list of the top 40 on the UN's human development index, there's quite a bit of variation in central government revenue. At first glance I don't see any clear pattern that would substantiate the claim that more individual and less government control of money is the universal recipe for prosperity and social welfare.

[argentine soccer fan]

The Laffable Curve is a complete joke within the context of American fiscal policy. It's VooDoo cubed. It's self-evident that at some point increases in tax rates will result in lower revenues, but we're nowhere near that point. His curve was nothing more than junk economics to support totally irresponsible tax cuts.

I think you are right. We are not near that point.

An argument could be made that before the first Reagan tax cut, the highest brakets for the richest Americans were near or at that point. But as it is right now, we are at a point in the curve that a decrease in taxes will not result in lower revenue.

But what is relevant about the Laffer curve is that, if the theory is correct, a decrease in taxes will result in a lesser decrease in revenue than the amount of the tax cuts. Meaning that if we cut taxes by X amount, we can afford to cut spending by a lesser amount than X. Obviously if we cut taxes but spending continues to increase, as it happened under Reagan and under Bush II, then the Laffer curve will not come to our rescue.

The other side of the equation is that in theory the money that is not used to pay taxes will help stimulate the economy. If Y is the amount that business and consumers save on taxes, then we can expect increased activity by a figure larger than Y.

Of course, I put in symplistic terms, but my point is that Laffer does work. It is a legitimate theory. But having said that, it obviously is not supposed to be a cure for irresponsible spending of the type that we are seeing these days in Washington.

[christopher d]

The theory is fine but that is not what is happening.

Gerrymandering has made it virtually impossible to get rid of a politician you don't like. The party in power draws the lines to make sure their party will STAY in power. Hence, lacking term limits, it just about takes a plane crash to get rid of someone. Which, actually, is an excellent allegory for the relationship of the kind of capitalism we have here to a "free market" society. It isn't there -- it's a myth. If a person bases their purchasing decision on shelf space, and prime shelf space is a scarce resource, the market isn't free. Actually, if a person bases his or her purchasing decision on anything other than the perceived relative merits of the product or its price, the market isn't free.

For instance: Grocers either cannot or will not (I really should know this, but am too lazy right now to look it up) label GMO-enhanced product as such. Why? Because they know, right or wrong, that consumers won't buy GMO product as readily as they will non-GMO product. What whomever is making the decision not to label GMO product is doing is taking a crucial decision-making datum away from consumers. In either event (Gov't or Grocers), the real decision not to label product is being made by the folks who manufacture such product, in the hopes that they can peddle a product that is cheaper to make, yet inferior in the marketplace, as if it were a product that is not inferior in the market place.

As a consumer, I'm lucky. I have a Whole Foods Market within a half-hour drive. I willingly pay roughly a 30% premium on groceries to be assured that I'm not purchasing GMOs. When I lived in Long Beach, however, I wasn't that lucky, so I was left purchasing a product I felt was inferior, simply because that was all that was available to me at the time. Market: not free.

You're stuck with Democrats as your representatives and I'm stuck with Republicans for much the same reason: the folks who stand to gain or lose most from the drawing of districts are the same folks who get to draw the districts. We can vote all we'd like, but our districts are laden with folks who don't agree with us as a result of those folks' representatives actions. Neither of us gets anything approaching real representation (OK, once we get to the White House, you do). Democratic? Nope.

[ratdog]

He probably wanted to avoid a 2-3 day argument with you.

Man: Look, I CAME HERE FOR AN ARGUMENT, I'm not going to just stand...!!

Mr Barnard: Oh, oh I'm sorry, but this is Abuse.

Man: Oh, I see, well, that explains it.

Mr Barnard: Ah yes, you want room 12A; just along the corridor.

[ratdog]

While being a good book, "The Jungle" does not have much to do with the market running amok. There is no Microsoft type monopoly. It is used to describe the poor treatment of employees in the meat-packing industry at the turn of the century.

OK, my schedule changed and I'm revved up from tonight's Storm game so I'm back earlier than Monday as anticipated.

"The Jungle" is partly about a "worm's eye view" of what happens when private enterprise is left to itself without proper government supervision. You see, unregulated capitalism has all kinds of nasty side effects, not least of which is that it cannot exist for very long on its own. At bare minimum it needs someone "outside" to enforce contracts. Of course, one unspoken argument of "the Jungle" is that if capitalism is to exist in a civilized society, it also needs government to take care of the social functions that profit-oriented markets simply cannot handle and it needs governent from literally killing off its own workers and customers via unsafe goods and dangerous workplaces. Capitalism would prefer that the government be of some more or less mildly authoritarian type and not a strong democracy for several reasons, the common basis of which reasons is that in strong democracies, The People tend to get all uppity and demand silly things like safe products, safe workplaces, working conditions (including hours, wages, etc.) fit for human beings, political rights, care for the environment, etc.

[quentinc]

Really, I view "The Jungle" as sort of a wake-up call to the middle-class about the plight of the lower end of society. It is often advertised as being a book about the brutal conditions of the American workplace. But I view it more as a story about a poor immigrant family that is used as a microcosm to express the author's views about America in general.

[dj43]

Which, actually, is an excellent allegory for the relationship of the kind of capitalism we have here to a "free market" society. It isn't there -- it's a myth. If a person bases their purchasing decision on shelf space, and prime shelf space is a scarce resource, the market isn't free. Actually, if a person bases his or her purchasing decision on anything other than the perceived relative merits of the product or its price, the market isn't free.

You bring up several interesting points.

First of all, I agree that the definition of "free" gets kicked around almost as much, or maybe more, than the definition of "sex." :) However, I would argue that there are enough alternatives to your neighborhood Ralph's that the market is "freer" than you suggest. Your example of Whole Earth is a good one. In Nor Cal we have, decent selections of organically-grown produce in Raley's and most other grocery stores. And as the public awareness of GMO products becomes greater, that will factor into the perceived value relationship.

On a broader level, the internet has become a major market for thousands of products so people are not limited to just their local retailer.

Of course this does not take into consideration those folks who do not have internet access, or have no access to travel the additional 20-30 minutes, (or choose not to do so) to purchase products that may be hazard free. However, any country,business or organization that gears it's decision-making process to the bottom 10% of it's people is doomed to failure.

This is not to say we ignore those folks either. That is the proper role of government. The balance point is the question.

Your example of GMOs is a good one to explore. I was raised on a small apple ranch and now live in the middle of one of the most productive agricultural areas in the world so I am quite aware of many of the factors affecting distribution and pricing. While I do no claim to be an expert on the topic, the biggest issue I see now with GMO labeling is that the cost of segregation and shipping of "GMO-free" products would add a significant cost to final retail. I fear that in a country that already eats too much junk food, adding more cost to truly healthy foods will just send more folks down that slope. Hence, I would much prefer that grocers continue to offer consumers a choice rather than forcing everyone to buy only "approved" products at much higher prices.

This last statement is made with a fair amount of personal background. My parents converted our apple farm to organic back in the '60. It took a couple of years for things to take hold but once all the right bugs started doing their job, we were able to receive a nice bump in price for "organically-grown apples." Nobody had to come along and put a label on them. We sold them from the ranch as well as to 2 different grocery chains in Nor Cal. Both of those chains now have large organic depts in their stores.

That market IS free, and becoming freer as discussions such as this one take place. We won't convince or inform everyone, but there will be enough that do become aware that the market responds. Maybe not as quickly as you or I would like but to force the market at a cost that eliminates a good share of the population from the equation is not acceptable either. If we are to have any hope for the freedom in the marketplace that we need, we cannot force cost increases that restrict those choices.

You're stuck with Democrats as your representatives and I'm stuck with Republicans for much the same reason: the folks who stand to gain or lose most from the drawing of districts are the same folks who get to draw the districts. We can vote all we'd like, but our districts are laden with folks who don't agree with us as a result of those folks' representatives actions. Neither of us gets anything approaching real representation (OK, once we get to the White House, you do). Democratic? Nope.

Not to be nit-picky here but just because I sometimes put an R behind my name doesnt' mean I support everything the pols do who have a similar designation. I strongly oppose much of Bush's econ policy. Tom Delay is the intellectual equivalent of Nancy Pelosi. Both parties should be equally disgusted by their extreme politics. Put them in the same boat and sink it a thousand miles from shore. But that is all a very different thread.