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Offlinekristofer
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when capital (or a lack thereof) holds you back..
    #7883596 - 01/15/08 02:05 PM (16 years, 16 days ago)

capital happens when the cost of production is less than the value of production.

[just a note here]
if you're a working class citizen, you're only worth whatever the minimum wage for a particular skill is. you'd be known as a laborer which is the lower of the class antagonism. unless you *own* the means to produce, you are not a capitalist.
[note is finished..]

I don't like the idea that because somebody "owns" the company it means they're entitled to a percentage of the value that the collective labor produces.. it's not like the investor on wall street contributes to the production at all.

The people that do the work should be entitled to the profit.. if you're just a capitalist looking to profit from investments instead of putting your thought and effort into real world problems and solutions then you're helping cause our social problems instead of working to solve them.

With capitalism all one needs is land.. once the land is afforded it's possible to generate capital by taking advantage of others. Even if there's no mode of production on property owned by a capitalist, there's still opportunity to profit simply because one *possesses* property (consider the landlord for instance).

Think about this.. if property stays in a family by being passed on and on generation to generation it creates a few land owning families, and a bunch of working class people that work and live off that land.. all the capitalist does is skim off the capital produced buy the people.

I find it ironic when capitalists preach that adam smith bullshit too.. because ultimately capitalism leads to a nation of wage slaves and wealthy capitalists.. even if one believes the middle class is still around, it's obvious that the separation between rich and poor grows and grows.

The capitalist argues that competition drives innovation.. and that the corporation (created by the collected investments of capitalists..) has enabled great people to create great and innovative products for consumers.

Consider yet though, things like the Open Source Software community which is worth billions of dollars even though it's distributed free of charge without restriction. It's certainly an anomaly in the capitalist mode of thinking.

Ultimately though, capital is the oil that keeps this machine running.. as long as capital is constantly being created the flow of goods from producer to consumer will be steady.. as soon as the flow of capital is interrupted we start seeing bad things like recession or even worse, depression.

How do we make sure that capital flows appropriately for economic growth? It's a tough question for even the most advanced economic scholars because it depends largely on how people feel about their economic conditions. If the economy is undergoing rapid growth it's easy to take risks in all the opportunity. But now that the country is so economically divided people aren't willing to risk so much. The opportunities just aren't their like they were before 9/11 and the dotcom bubble and the more recent subprime mortgage fallout.

Now I think it's time to start considering new ideas for economic growth.. instead of letting government or capital regulate and control the means to produce, why not let the workers do it? It distributes the capital produced by their collected efforts equally among those involved with the actual work.

(I could go on and on.. so I'd better some this up..)
By eliminating the capitalist there's no class antagonism between the laborers and the wealthy. Everyone would only be *equally* worth whatever the collected value of the labor is.


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OfflineGnosticWarrior
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #7884485 - 01/15/08 04:54 PM (16 years, 16 days ago)

The owner, is the one who is helping to finance the business operation. The overall finance comes from two groups, the creditors and the owners. The creditors have a defined contract to get paid back and in event of bankrupcy has first dibs over the owners. If there is no money left over the owners lose all the capital they invested. Ask any shareholder who has watched their capital go to zero only to watch the creditors ended up being the new owners of the reorganized bankrupt company. A lot of companies have raised capital be selling pieces of ownership, in exchange for pieces of the profits. The company does not have to worry about paying back the owners.

Workers get paid, regardless if the business operations are profitable or not. They have no vested interest in the company except as a source of employment. They have no obligation to the company except to perform the tasks that they had agreed upon for employment. They can leave at anytime they choose, for whatever reasons.

For all players, Owners, Creditors, and Workers, I don't see anything better than Capitalism. It does vary by country. I hear Japan's system is better for workers than for owners but, also a part of the reason why their economy is hasn't done too well for the past decade or so.

There's also Employee-Owned Companies and stock options that can be granted to workers, in the belief that company will produce better results, if the workers had a vested interest. If a worker does not like working for a company that does not give them a stake in the profits, maybe they should work for one that does?


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InvisibleIcelander
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #7892763 - 01/17/08 12:12 PM (16 years, 14 days ago)

I have a hard time feeling sorry for the "Wage Slave" anymore. IMO they are the ones who follow the consumer trends and don't know how to save or live within their means and then whine when they are broke and in debt and expect a bailout. I think Sheep is a better term for them.


--------------------
"Don't believe everything you think". -Anom.

" All that lives was born to die"-Anom.

With much wisdom comes much sorrow,
The more knowledge, the more grief.
Ecclesiastes circa 350 BC


Edited by Icelander (01/17/08 12:12 PM)


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Offlinekristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: Icelander]
    #8089702 - 03/01/08 12:43 PM (15 years, 10 months ago)

capitalism stifles innovation.

that may seem ridiculous, but consider the auto industry. how many patents to improve gas mileage on vehicles were bought, and then shelved by auto manufactures? also consider that auto manufacturers obviously have investments in the oil industry.. they kind of go hand in hand after all.

or consider the computer software world. microsoft literally monopolizes the the industry despite having an inferior product. but they keep the market share because they give to schools.. and kids grow up using microsoft, so businesses run microsoft.. ad infinitum.

I could go on and on.. local utilities, cell phone companies, grocery stores, gasoline, borrowing money, etc.. all of them rape their consumers and their employees.

it's brilliant I agree.. and also exploits millions of consumers who don't even understand what I'm talking about. maybe I'm complaining about an awareness thing, but it's still wrong. you don't make a billion dollars without exploiting someone.


--------------------
dewbie dewbie dew


Edited by kristofer (03/01/08 01:22 PM)


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Offlinefireworks_godS
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #8094371 - 03/02/08 05:09 PM (15 years, 10 months ago)

Interesting thread. This is a topic that I've been contemplating recently, but I haven't felt my thoughts coalesce enough to create a thread for discussion. It is definitely a topic that needs to be discussed more, especially as we head into a presidental election that has great odds of producing a much more socialized country of the United States.

I think I'd start by pointing out that 10% of the population of the United States essentially owns the country. They own nearly 90% of all privately-held stock, bonds, trust funds, and business equity, and 3/4 of all non-home real estate (1). This is something that just boggles my mind. I was speculating on whether this is simply a natural result of a natural system, but when one looks towards the transfer of energy from the sun to the highest trophic level of animals, it is completely inversed, and I see wealth and energy in much the same way.

Wealth is limited; it cannot be generated infinitely. There is only so much energy available from the Sun, and the Earth's primary productivity (the total amount of plant mass that converts the energy) is limited as well. The wealth that is held by the top 10% results from the economic system of which everyone plays a part in carrying out.

It is clear that, if left unchecked, the holders of wealth will utilize that wealth to accumulate more wealth, and this has an effect of taking money out of the economic system, making it less capable of functioning properly. As someone who has worked in retail for a large corporation, far too often I have seen first-hand a pretty vicious cycle that is played out - sales go down, but the corporation does not want their stock to go down, so they cut the difference out of their business operations, making it less capable of doing business, furthering negative impact on sales. Corporations really act as cash funnels.

As has already been stated, when one has wealth, one has more means of generating more wealth. Government sets the framework within which an economy functions, and, all too often, those with wealth utilize it to change this framework to make it more possible to accumulate more wealth.

In nature, there is a dynamic system of checks and balances, such as with snowshoe hares and lynx populations. If the snowshoe hare population dwindles from overpredation, for example, then the lynx population will begin to plummet as well, since there isn't enough resources for them to consume. If we look at the situation that the American middle class is in today, it would seem that their wealth has been sucked back to the top. For example, the bottom 60% makes only .95 cents per dollar that they made in 1979, as of 2004, the next 20% made 1.03 per dollar that they made in 1979, with the top 5% making $1.53 per 1979 dollar (information from link provided above). Here's a graph (from that link) on the share of earned capital income:







I see government as a check agansit this, and that certainly opens up a wide discussion. :lol: If anyone wonders why we're heading towards a recession, it would seem quite likely that it got sucked right out of the economy's infastructure. :shrug:


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OfflineRedstorm
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #8094485 - 03/02/08 05:40 PM (15 years, 10 months ago)

Unless the common laborer has a capital stake in the company he or she is working for , he or she has no right to profits other than what they were promised in wages.

If the laborers assumed some of the risk associated with running a business, then they would have a claim to profits, but most do not.


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Offlinekristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: fireworks_god]
    #8094487 - 03/02/08 05:40 PM (15 years, 10 months ago)

Quote:



I see government as a check agansit this, and that certainly opens up a wide discussion. :lol: If anyone wonders why we're heading towards a recession, it would seem quite likely that it got sucked right out of the economy's infastructure.






Indeed, greed in the banking system and government deficit spending are devaluing our dollar and leading us into a recession. Ironically, by enabling the working class to afford a better lifestyle, production would increase and profits would soar.

That's the nature of labor as a commodity though. Just like all other commodities, when there's too much, the value falls, and when there's not enough, the value skyrockets.

We can consider the computer industry again in this case. A computer technician in the 80's was a highly skilled trade, but as  prices for computers fell it enabled the working class to afford personal computers. So now we have a generation of computer nerds from the 90's with all the skill of the highly paid professional technicians of the 80's. Suddenly comtech jobs are part time positions held by college students for $10 an hour. Or they're held by Indians who get paid $3 a day.

It's just the nature of capitalism though. There's no fixing the economy. There's only changing how we think of value.


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Offlinekristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: Redstorm]
    #8094519 - 03/02/08 05:50 PM (15 years, 10 months ago)

what risks are associated with running a business? It's an investment, and at the very least it's going to be worth the value of the property it owns or creates.

but if the business fails the laborer had no stake and gets nothing but a few dollars for some time. he's not entitled to any part of the collective creation or it's liquid value.


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OfflineRedstorm
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #8094531 - 03/02/08 05:54 PM (15 years, 10 months ago)

"what risks are associated with running a business? It's an investment, and at the very least it's going to be worth the value of the property it owns or creates."

Along with depreciation on these pieces of property and a lack of buyers for failing companies in today's market, there is a great deal of risk involved with running a business.

My point is that unless the labor collectively funds the company at start-up, they should have no claim over profits other than what they were promised. They take no losses if the company fails, so why should they reap the profits if it excels?


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Offlinekristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: Redstorm]
    #8094553 - 03/02/08 06:00 PM (15 years, 10 months ago)

labor does collectively fund the process. there would be no capital at all without labor. capital is created by labor. how many other ways can I put this? if there was no labor, there would be no product. a laborer, regardless of financial contribution, has an effort in the overall production, and should be entitled to an equal share of that profit.


--------------------
dewbie dewbie dew


Edited by kristofer (03/02/08 06:01 PM)


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Offlinefireworks_godS
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #8094642 - 03/02/08 06:24 PM (15 years, 10 months ago)

Quote:

kristofer said:
It's just the nature of capitalism though. There's no fixing the economy. There's only changing how we think of value.




Stiffen the tax on the top 10% to prevent wealth from concentrating up there. That's how the problem happened, and that is what needs to change.


--------------------
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If I should die this very moment
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Like being here
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Offlinekristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: fireworks_god]
    #8095059 - 03/02/08 07:58 PM (15 years, 10 months ago)

Quote:

Stiffen the tax on the top 10% to prevent wealth from concentrating up there. That's how the problem happened, and that is what needs to change.




The wealthy don't have a lot of money per se. They have a lot of assets that create wealth though. The Google guys have a $45k a year salary, yet they're worth billions in stocks. Effectively the wealthy have systems in place that generate profit. It's not ideal to tax the systems the wealthy create either. When taxes are too high corporations pack up and go to developing nations where labor and taxes (and environmental regulations) are cheaper. That's even worse for our economy..

And taxing the top ten percent doesn't fix the distribution of wealth.


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OfflineRedstorm
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #8096425 - 03/03/08 05:04 AM (15 years, 10 months ago)

Quote:

kristofer said:
labor does collectively fund the process. there would be no capital at all without labor. capital is created by labor. how many other ways can I put this? if there was no labor, there would be no product. a laborer, regardless of financial contribution, has an effort in the overall production, and should be entitled to an equal share of that profit.




However, it could also be argued that without the initial capital investment, there would be no opportunity for labor.


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OfflineRedstorm
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #8096446 - 03/03/08 05:44 AM (15 years, 10 months ago)

Quote:

kristofer said:
labor does collectively fund the process. there would be no capital at all without labor. capital is created by labor. how many other ways can I put this? if there was no labor, there would be no product. a laborer, regardless of financial contribution, has an effort in the overall production, and should be entitled to an equal share of that profit.




However, it could also be argued that without the initial capital investment, there would be no opportunity for labor.


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Offlinefireworks_godS
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #8096504 - 03/03/08 06:49 AM (15 years, 10 months ago)

Quote:

kristofer said:
The wealthy don't have a lot of money per se. They have a lot of assets that create wealth though. The Google guys have a $45k a year salary, yet they're worth billions in stocks. Effectively the wealthy have systems in place that generate profit. It's not ideal to tax the systems the wealthy create either. When taxes are too high corporations pack up and go to developing nations where labor and taxes (and environmental regulations) are cheaper. That's even worse for our economy..

And taxing the top ten percent doesn't fix the distribution of wealth.




Sure, don't tax the systems in place, but one can certainly tax the capital gains and dividends that result, or, at the very least, roll back the tax cuts on capital gains and dividends. The wealthy are disproportionately benefiting from those tax cuts.





http://www.cbpp.org/1-30-06tax2.htm

Of course those taxes affect the distribution of wealth. Let me refer you to a quote from the link I provided in the first post, and I'll couple it with the same chart again:



Quote:


A key factor behind the high concentration of income, and the likely reason that the concentration has been increasing, can be seen by examining the distribution of what is called "capital income": income from capital gains, dividends, interest, and rents. In 2003, just 1% of all households -- those with after-tax incomes averaging $701,500 -- received 57.5% of all capital income, up from 40% in the early 1990s. On the other hand, the bottom 80% received only 12.6% of capital income, down by nearly half since 1983, when the bottom 80% received 23.5%. Figure 5 and Table 7 provide the details.









So, there is the share of capital income steadily increasing for the top 1%, and then you have the government giving greater and greater amounts of tax cuts on capital gains and corporate dividends. I think that goes a long way towards affecting wealth distribution... the top 10% holds 90% of all publically-held stock. Also, although I haven't found more information regarding this study, this was referred to at the first website I linked to in this thread:


Quote:


This point is seen most dramatically in a recent simulation study which suggests that the income distribution would have stayed the same over the past 50 years -- not become much more concentrated, as it did -- if Democratic patterns of income growth had been followed during that whole period. On the other hand, the inequality of the income distribution would have increased almost 80% faster if Republican income growth patterns had been in place during that same period (Bartels, 2003; Jacobs & Skocpol, 2005). That's a huge difference for Americans in general, even though wealth still would have been highly concentrated in the top 1% -- the corporate rich/social upper class -- under either set of policies. For example, the top 1% had 31.1% in 1968, at a time when Republicans had held the presidency for only eight of the previous 36 years, and the Congress for a mere four of those years, whereas the top 1% had 38.1% in 1998.





--------------------
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If I should die this very moment
I wouldn't fear
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Like being here
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Offlinefireworks_godS
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #8096513 - 03/03/08 07:03 AM (15 years, 10 months ago)

Quote:

kristofer said:
labor does collectively fund the process. there would be no capital at all without labor. capital is created by labor. how many other ways can I put this? if there was no labor, there would be no product. a laborer, regardless of financial contribution, has an effort in the overall production, and should be entitled to an equal share of that profit.




Perhaps, but I don't think its possible to make such a change through the corporations themselves, since it seems practically impossible for government to step into the operations of corporations and dictate how much of their profit goes towards the employees who made it all possible. As someone who worked in management at Wal*Mart for awhile, I would have simply been happier if some of that profit was not taken out of business operations, although I certainly wouldn't have refused a bigger paycheck. :smirk: It really is disappointing to see a fraction of the work that needs to occur within a store occur because people drawing budgets levels up drew a line here instead of there to hide a loss from investors. It really does hurt business, but corporations find incentive in making that stock price go up. If they'd simply show a loss when it happens and not take the money out of operations, they'd be more capable of doing better business by not creating for themselves so many missed opportunities.

It can only be done through taxes, and the capital gains and corporate dividends tax is the way to go. If there isn't a check in place that dampens the amount of profit one can gain from investing in corporations, then that profit is going to be funneled out of corporations and away from laborers, the middle class. Wealth is going to accumulate in the top 10% but especially the top 1%. The middle class will be further squeezed out and the economy with it.


--------------------
:redpanda:
If I should die this very moment
I wouldn't fear
For I've never known completeness
Like being here
Wrapped in the warmth of you
Loving every breath of you

:heartpump: :bunnyhug: :yinyang:

:yinyang: :levitate: :earth: :levitate: :yinyang:


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Offlinefireworks_godS
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Re: when capital (or a lack thereof) holds you back.. [Re: fireworks_god]
    #8096522 - 03/03/08 07:11 AM (15 years, 10 months ago)

I thought I would post this here since it pretty relevant:

Quote:

http://www.swamppolitics.com/news/politics/blog/2007/09/obama_proposes_tax_cuts_for_lo.html

Democratic presidential candidate Barack Obama is to deliver a speech today proposing tax cuts for low- and middle-income families worth about $80 billion to $85 billion, according to his campaign.

An advance look at the tax cut proposal provided by his campaign describes a would tax credit that would give low- and middle-income wage-earners up to $500 off their income taxes. The benefit would phase out for people making "about $150,000 to $200,000," according to a campaign official who briefed reporters on the plan but declined to be identified.

Moreover, the tax credit would be refundable for people who earn wages, which essentially would expand the Earned Income Tax Credit that provides government payments to very low-income workers.

The contours of the tax cut repesent the very opposite approach to that used by the Bush Administration in its tax cuts. Since the Bush Administration cut tax rates, most of the benefit went to higher-income people. And the Obama campaign already has announced it would reverse the Bush Administration tax cuts for families earning more than $250,000 per year.

The campaign says it would offset the cost of the tax cut by eliminating corporate tax loopholes including tax breaks given to the oil and gas industry, curtailing the use of tax shelters and raising the tax on capital gains and dividends to as high as 28 percent.

The proposal also includes a "universal mortage credit" of 10 percent of mortgage interest paid to home-owners who do not itemize their taxes. Most of the benefit would go to families who earn less than $50,000 per year, the campaign says.

Most people with more expensive homes itemize their taxes since the combined value of deductions for mortgage interest and property taxes typically exceeds the standard deduction that people who do not itemize their taxes are allowed. The Obama plan would not affect the existing home mortgage interest deduction.

Other features include an exemption for senior citizens on the first $50,000 of income per year.





--------------------
:redpanda:
If I should die this very moment
I wouldn't fear
For I've never known completeness
Like being here
Wrapped in the warmth of you
Loving every breath of you

:heartpump: :bunnyhug: :yinyang:

:yinyang: :levitate: :earth: :levitate: :yinyang:


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Invisiblebradmassive
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #8096964 - 03/03/08 10:44 AM (15 years, 10 months ago)

Quote:

kristofer said:
capitalism stifles innovation.

that may seem ridiculous, but consider the auto industry. how many patents to improve gas mileage on vehicles were bought, and then shelved by auto manufactures? also consider that auto manufacturers obviously have investments in the oil industry.. they kind of go hand in hand after all.

or consider the computer software world. microsoft literally monopolizes the the industry despite having an inferior product. but they keep the market share because they give to schools.. and kids grow up using microsoft, so businesses run microsoft.. ad infinitum.

I could go on and on.. local utilities, cell phone companies, grocery stores, gasoline, borrowing money, etc.. all of them rape their consumers and their employees.

it's brilliant I agree.. and also exploits millions of consumers who don't even understand what I'm talking about. maybe I'm complaining about an awareness thing, but it's still wrong. you don't make a billion dollars without exploiting someone.





You need to read up on 'free markets'.

"A free market is a market in which prices of goods and services are arranged completely by the mutual consent of sellers and buyers. By definition, in a free market environment buyers and sellers do not coerce or mislead each other nor are they coerced by a third party.[1] In the aggregate, the effect of these decisions en masse is described by the natural law of supply and demand. Free markets contrast sharply with controlled markets, in which governments directly or indirectly regulate prices or supplies, distorting market signals.[2] In the marketplace the price of a good or service helps to quantify its value to consumers and thus balance it against other goods and services. In a free market, this relationship between price and value is more clear than in a controlled market. Through competition between vendors for the provision of products and services, prices tend to decrease, and quality tends to increase." - Wiki

Capitalism produces innovation by virtue of free markets. In a true capitalism Monopolies would find it difficult to develop as the quality of the product defines the value of the goods. It is not 'capitalism' that is to blame for stifling innovation but the government controlled markets of so called 'corporate capitalism' that are to blame. That is where the exploitation festers.


--------------------
"In the beginning, I had no name. i was a shape, a snarling shadow of the Old World which slipped into this existence" - Steven Erikson

"Our progress as a species rests squarely on the shoulders of that tenth person. The nine are satisfied with things they are told are valuable. Person 10 determines for himself what has value." - My good friend Za -


Edited by bradmassive (03/03/08 12:14 PM)


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Offlinephi1618
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
    #8097234 - 03/03/08 11:56 AM (15 years, 10 months ago)

How do you decide what to make?

Somebody has to decide whether to build a paper mill or a solar cell factory, and somebody needs to decide when it's time to close that paper mill because nobody reads the paper anymore anyway.

In a capitalist system, anybody can make that decision to build a factory - all you need to do is find the capital. If you build a solar cell factory, and next year everybody finds that the solar cells you build provide a secure and inexpensive power source, you get rich and have more capital to deploy for future projects - you made a good decision, and are rewarded. If you build a paper mill, and can't sell your product, the factory closes and you're bankrupt - you made a poor decision and don't get to screw up any more because you're out of money.

No matter what system is used, somebody needs to decide how to deploy resources. If a Central Committee decides that the paper mill workers are good, hard workers and deserve to keep their jobs and the mill keeps running even though nobody wants the paper, society will eventually become poor because the workers are not creating value that anybody wants.

In any case, some regulations and taxes are needed, though keeping the interests of government officials aligned with those of the people is a tough problem. But, the basic idea that people are responsible for the capital they deploy (and suffer the consequences of any poor decisions they make) is really the only way to make sure that the right job is being done.


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Re: when capital (or a lack thereof) holds you back.. [Re: phi1618]
    #8097337 - 03/03/08 12:24 PM (15 years, 10 months ago)

Good post. :thumbup:


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