A Problem I See With Pure Capitalism

[Darryl_P]

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But Buddhists don't really seem engulfed in their religion, the way catholics protestants do.

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Is that because you don't see them trying to convince others of the benefits of their religion?

If so, then I'd say that doesn't imply that they are not engulfed in the tenets of their religion, an important one of which is minimizing desire (including minimizing the desire for material goods beyond what is needed for survival).

Edit: the reason I say this is because I know I'm engulfed in my own religion, but if you met me on the street you'd never know it.

[southerndog]

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But Buddhists don't really seem engulfed in their religion, the way catholics protestants do.

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Is that because you don't see them trying to convince others of the benefits of their religion?



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No.. But I really hate the way you asked that question.

[Darryl_P]

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No.. But I really hate the way you asked that question.

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Sorry about that. I'll try to ask another one then in a different way...

What observations about Catholics and Protestants make them seem engulfed in their religions?

I don't claim to know more about Thai people than you, seeing as I've never been to Thailand. But I have been to places where people seem less religious yet adhere to religious tenets more than in the USA. I was just wondering if it's similar in that regard.

[BCPVP]

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Standard Oil was slashing prices to drive competitors out of business.

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Standard was "slashing" prices because they could afford to offer better prices. It's called competition. An article by John McGee dispelled the myth of predatory pricing by Standard Oil, if you care to read up on the subject.

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It made deals with railroads to charge competitors higher rates, so that they couldn't effectively transport oil from their fields

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I think you meant that Standard made rebate deals with railroads so that they were charged less. But so what? Railroads have high fixed costs and low variable costs. The railroad just needs to cover its variable costs to be profitable. So the more business, the better. Standard gave the railroads heavy traffic, which is what they wanted. Should railroads not have the right to determine what they charge? Should Standard not have had the right to bargain over those rates?

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That is, why standard oil was broken up. Sure low prices were nice, but we know it was part of a scheme to monopolize the oil industry. Although a large conglomerate-monopolist is capable of producing more efficiently through economies of scale, anyone who has taken any economics will tell you it has no economic incentive to do so. Its not cost that determines price, but demand.

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Standard was broken up because of emotion-driven arguments and poor economics that believe "perfect competition" is something that could ever be acheived. Standard had ~90% of the market around 1890. By the time of its anti-trust trial, it had about ~66%. Also, the standardy theory of how a monopoly works would be it reducing output and raising prices, but that never happened during Standard's history. So clearly fears of monopolization were not the reason.

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Thus, when they relocate its not consumers (and certainly not the laid off employees), but company owners and wealthy investors that benefit.

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You never answered my question about WalMart's prices. Would they be less than, equal to, or greater than the current prices if all of WalMart's goods were made in the U.S.?

You're also ignoring the benefit these companies have on the local economies that they exist in. People wouldn't be leaving their subsistence (or worse) farming jobs for these factories if they didn't offer a better life.

[wilneedheart]

Dear David,

I have studied Social Science to Post Graduate level and I cannot understand what you are driving at.

Forget "explict". Try "clear".

Cheers.

[Mickey Brausch]

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I've lived in Thailand for the past 7 months.. Many people make $100 per month or less, while many others drive mercede's and bmw's... Despite this fact, crime is not rampant here. Why is that?

[/ QUOTE ]Comparing percentages across the two populations, would you say that Thais are, generaly, more religious than Americans?

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I really don't know.. I think its like 98% are buddhist.

[/ QUOTE ]I am only trying to guess, amateurishly, some cultural factor which would account for the difference between Americans and Thais in crime figures. It could be the difference in the religions -- or in religiosity.

It's clearly a cultural factor (as opposed to a biological one) but what is it, you think?

[Mickey Brausch]

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...the debate should be about whether my contention makes sense.

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Your contention doesn't relate to pure capitalism because those +EV stealing situations don't arise as an inherent part of the system. They arise only if someone makes a mistake.

[/ QUOTE ]Wow.

Capitalism is perfection, then.

If only we knew the right moves beforehand, we'd always make 'em!

I think we are nearing the Jordan River, boys. We are about to be baptized as true capitalists, and never stray from the holy path of the Nobel Laureates.

[_D&L_]

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Standard was "slashing" prices because they could afford to offer better prices. It's called competition.


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The lower prices were combined with collusion with the railroads to charge competitors higher rates, to make competitor's businesses unprofitable. Because standard oil was selling cheap, Standard's competitors couldn't sell their oil in at high enough prices to pay to ship oil at the railroad's marked up rates, and this made them more susceptible to being bought out.

Even if you think that Standard oil had good intentions. Are you really trying to advocate that we allow monopolization of markets to occur, so that we can rely on the perpetual good will of these profit driven companies? Wouldn't shareholders / takeover specalists vote out any warm-hearted CEO once the oil market had been completely monopolized?

Why do you think OPEC exists? De Beers? Because they aren't US companies governed by US antitrust law, they limit supply of oil, diamonds, etc, to artifically inflate prices by limiting supply.


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You never answered my question about WalMart's prices. Would they be less than, equal to, or greater than the current prices if all of WalMart's goods were made in the U.S.?


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My point was never that cheap foreign labor doesn't sometimes make goods cheaper. Its that it doesn't have to. What forces price towards marginal cost is competition. So yes ghetto walmart goods get cheaper because everyone is capable of producing them.

But how about Microsoft which uses Indian customer support personnel, Indian programmers, etc. Who competes with it? It gets to set the monopoly price on its software, the lower costs are translated into shareholder profits, but employees lose jobs.

Once you realize that no market for a company's good is perfectly competitive you begin to realize that not all costs savings will be translated into lower prices, they are quite capable of going to the company's owners instead. Price = marginal cost, only in a perfectly competitive model. But you seem to know some economics, so you know perfect competition in real world seldom exists. After you realize that, it doesn't necessarily follow that working class american's are better off from "lower cost goods" because they may have lost more from having to take the next best job.

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You're also ignoring the benefit these companies have on the local economies that they exist in. People wouldn't be leaving their subsistence (or worse) farming jobs for these factories if they didn't offer a better life.


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I'm not ignoring it. I said that I am Pro-free trade. Free trade is a NET win-win for both countries. Just because I think we should look at how wealth created by free trade is distributed in this country, doesn't mean I'm against it. I think your visualizing me as some hippie WTO protestor, i'm not.

[Hoi Polloi]

Some would argue that "pure capitalism" would simply be institutionalized theft by the rich from the poor, so in such a system the poor would have to steal some back. You're probably better off trying the calculate the break-even point vis-a-vis gain by theft versus loss due to prison time, etc. The laws are written by the powerful to reproduce the conditions of their power, etc.

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If you accept the premise that society is better off in the long run if everyone is trying to selfishly maximize their own gain, what argument can you make against criminal behavior, to those who are in situations where the "trickle down" effect does not figure to reach them in the forseeable future?

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This is a gross simplification of Smith's invisible hand along with a conflation of the supposed secondary benefit of so-called supply-side economics. Remember Smith was very clear that the only free market is a well regulated market. An unregulated market will not remain free for very long. So, we could say that the invisible hand does not come into effect until a well-regulated free market is established at which point single-minded pursuit of one's own interests produces the paradoxical result of benefitting all. If you mean by "pure capitalism" Smith's vision of the preconditions of free markets then you're much closer in my view to the kind of society, namely a market-regulating one, that might tip the scales in the poor man's calculation of his own best interest toward foreswearing criminality.

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Put another way, it seems to me that there are two reasons why poor people should not steal even if they are sure they will not get caught. One is that they are in a system that will have a good chance of elevating them to a greater degree than another system would. So they shouldn't be a party to disrupting it. The other would be if the system frowns on people who live in lavish luxury and do nothing to help the downtrodden.

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Regarding reason 1: Is there really ever a "system" without some theft? Some lawlessness? Why would a society need laws if there was no lawlessness?

Regarding reason 2: this is not a reason why someone would choose not to use outlawed means for attaining benefit.

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But say you are in a miserable situation (especially if it is due to little fault of your own) and the architects of your economy say there is nothing wrong with someone owning diamond toilet seats if they can afford it. And go on to justify this stance with the explanation that most poor people will do better in such a system. Then if you are not likely to be one of the poor people who benefit, why not steal from the guy with the toilet seat if you can get away with it?

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Isn't this the game theory chestnut that if everyone else is following the rules you will benefit by breaking them, but if everyone breaks the rules you're better off when everyone including you follow the rules?

[southerndog]

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I've lived in Thailand for the past 7 months.. Many people make $100 per month or less, while many others drive mercede's and bmw's... Despite this fact, crime is not rampant here. Why is that?

[/ QUOTE ]Comparing percentages across the two populations, would you say that Thais are, generaly, more religious than Americans?

[/ QUOTE ]

I really don't know.. I think its like 98% are buddhist.

[/ QUOTE ]I am only trying to guess, amateurishly, some cultural factor which would account for the difference between Americans and Thais in crime figures. It could be the difference in the religions -- or in religiosity.

It's clearly a cultural factor (as opposed to a biological one) but what is it, you think?

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Mickey, I don't think its a religious thing. Thailand is a VERY different place.. There truly is a culture in which everyone conforms to. Respect for elders, educators, wealth, achievements.. Thai's are never confrontational. They also never want to "lose face". So, getting arrested would mean a terrible disgrace to that person and their family.

Now, all of that being said.. Many people have bars on their windows to prevent theft, and cars are always watched by security in parking lots when you go out to eat, etc..

Now, in terms of crime over all (not just theft/profitable crimes).... There is very little violent crime, teenagers do not commit idle minded acts like vandalism, etc... I think this may go back to the same reasons of fear of embarassment, etc..