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#142
12-10-2006, 01:09 AM
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Capitolism creates an upward spiral...
The replies are too numerous to go through (so I have not), but let me break it down for you. (First of all I support both.)
The fact that life/money/whatever is unfair is a GOOD thing. This enables one to find out how to be on the winning side. With courage and education, one can get more than the "fair" share. Many rich people (first generation wealth) also understand that they got rich by their understanding of money and their education, and seek to give (philanthropy) and also teach. We are getting a bit sidetracked from my point though those two ideas do play a role. This system we have allows us to "spiral upwards" into becoming the richest nation there is. By having the system unfair like it is, you create a competition for wealth, and you have lots of people doing all the various things the believe will get them wealthy. Some work hard at a "secure" job, others build investments and equity, others do other things, and many complain about the system. But when you throw that mix together, what happens is you have a whole system of people geared towards creating more and trying to get more, and what emerges from that is a society where there is much more abundance all around because EVERYBODY in it is working to create that. It may not be evenly distributed but it is the BEST way to CREATE that wealth. You heard the statistic that says the poorest Americans live better than 75% of the rest of the world. Why is that? HOW is that??? It is because this system allows for and creates a productive, cooperative society, on the whole, even if it is not 100% even and fair. Everybody creates more and more and gets more and more. It's a sort of equilibrium in game theory. Let's say you can get a 20% edge in X investing. So can your friend. Another guy can average 25%. Guy 4 gets 30%. Now let's say Guys 3 and 4 share how to make 24%, keeping that little extra edge for themselves. You and your friend benefit. But now Guys 3 and 4 will only continue to help if you share something valuable you have. You see where this is going... Capitalism is a situation where everybody exchanges in order to become better off. EVERYBODY CAN BE better off, even if the amount by which they are better is not evenly distributed. This continues and creates an upward spiral of well-being, so that even the worst off are better than they would be if the system was different. I know very little about game theory or about economics so if somebody wants to show me how stupid I am, I an open to suggestions. But I think I am getting the gist of it right. 
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#143
12-10-2006, 01:12 AM
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A sub-point
I have heard the "if I gain, you lose" way too many times, so let me address it. Win-win situations are ALWAYS possible because one party's values are different from another's. If I think X is worth 5 and you think it's worth 10, then we'll both win trading at 7.
So don't go there!
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#145
12-10-2006, 02:12 AM
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Re: Richest 2% hold half of world\'s assets
[ QUOTE ]
No. I "work for" the guy whose yard I'm mowing. [/ QUOTE ] Sure ok. You work for him, but you aren't his employee. He's a client. Are you gonna tell me a lawyer with his own practice isn't self employed because he has clients?
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#146
12-10-2006, 02:17 AM
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Re: A sub-point
[ QUOTE ]
I have heard the "if I gain, you lose" way too many times, so let me address it. Win-win situations are ALWAYS possible because one party's values are different from another's. If I think X is worth 5 and you think it's worth 10, then we'll both win trading at 7. So don't go there! [/ QUOTE ] Sure, but you're talking about commerce. The problem with capitalism stems from it's parasitic production model, where the owner contributes nothing, but still benefits the most.
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#147
12-10-2006, 02:33 AM
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Re: A sub-point
[ QUOTE ]
I have heard the "if I gain, you lose" way too many times, so let me address it. Win-win situations are ALWAYS possible because one party's values are different from another's. If I think X is worth 5 and you think it's worth 10, then we'll both win trading at 7. So don't go there! [/ QUOTE ] If I gain, you lose is simple economics even if situations can be considred win-win. If the price of gasoline goes up, I have less to spend on other things, and gasoline providers have more. Certainly if you have the option to buy gasoline for less from someone else, you buying the gasoline from him instead of the other guy is win-win, but that's in comparison to the loss. Let's say I am a Doctor, Doctors in the USA average more than twice the European average. If every doctor in the USA had to take pay commesurate with european doctors, then everyone else would have more money because the doctors would cost less. In USA though, the supply of doctors is kept artificially low so that doctors can get paid more because they're in demand. Since they get paid more, you and I have less. CEOs are similar in that they take from everyone else at their own benefit (Micheal Eisner of Disney made $650 millioon which was equal to more than 10% of Disney's profits, if he made a more reasonable salary, all stock owner's of Disney would have more.) But different because CEOs don't get paid an exorbitant amount because of artificially low supply but rather because of laws in the USA regarding corporate governance (shares may get to vote, but every non-voting share, which, most don't vote because they're held by mutual funds, gets counted as siding with the management instead of simply not counted) and the fact that most CEOs stock their boards full of their close friends and are members of many other boards where their friends are CEOS.
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#148
12-10-2006, 02:45 AM
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Re: A sub-point
[ QUOTE ]
most CEOs stock their boards full of their close friends and are members of many other boards where their friends are CEOS. [/ QUOTE ] This is nonsense. The majority of directors on a board of a publicly traded company must be independent as determined under the qualification rules of the exchange they are listed on. Nominees for the directorships are voted on by the shareholders.
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#149
12-10-2006, 02:57 AM
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Re: A sub-point
[ QUOTE ]
[ QUOTE ] most CEOs stock their boards full of their close friends and are members of many other boards where their friends are CEOS. [/ QUOTE ] This is nonsense. The majority of directors on a board of a publicly traded company must be independent as determined under the qualification rules of the exchange they are listed on. Nominees for the directorships are voted on by the shareholders. [/ QUOTE ] When all unreturned shareholder votes are counted as siding with the management, and most votes aren't returned because they're owned through mutual funds, shareholder votes don't mean anything at all.
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#150
12-10-2006, 04:53 AM
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Re: A sub-point
[ QUOTE ]
[ QUOTE ] I have heard the "if I gain, you lose" way too many times, so let me address it. Win-win situations are ALWAYS possible because one party's values are different from another's. If I think X is worth 5 and you think it's worth 10, then we'll both win trading at 7. So don't go there! [/ QUOTE ] Sure, but you're talking about commerce. The problem with capitalism stems from it's parasitic production model, where the owner contributes nothing, but still benefits the most. [/ QUOTE ] The entrepreneur guarantees wages to the worker in exchange for the profit. The workers don't have to wait till the goods are being sold to make money; they make money whether there's a profit or loss. The entrepreneur is compensated for the risk he takes with any profit made. Both sides explicitly agree to this arrangement there should be no problem. And didn't you admit earlier that most owners/managers are not parasites? What's the point of calling capitalism a "parasitic production model" if not empty rhetoric?
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