Carleas - Is ILP capitalist-philanthropic or socialist?

Thanks :slight_smile:

He resonated strongly with democrats in areas:

[i]It can be argued that private charity is insufficient because the benefits from it accrue to people other than those who make the gifts— … a neighborhood effect. I am distressed by the sight of poverty; I am benefited by its alleviation; but I am benefited equally whether I or someone else pays for its alleviation; the benefits of other people’s charity therefore partly accrue to me. To put it differently, we might all of us be willing to contribute to the relief of poverty, provided everyone else did. We might not be willing to contribute the same amount without such assurance. In small communities, public pressure can suffice to realize the proviso even with private charity. In the large impersonal communities that are increasingly coming to dominate our society, it is much more difficult for it to do so.

Suppose one accepts, as I do, this line of reasoning as justifying governmental action to alleviate poverty; to set, as it were, a floor under the standard of life of every person in the community. [While there are questions of how much should be spent and how, the] arrangement that recommends itself on purely mechanical grounds is a negative income tax. … The advantages of this arrangement are clear. It is directed specifically at the problem of poverty. It gives help in the form most useful to the individual, namely, cash. It is general and could be substituted for the host of special measures now in effect. It makes explicit the cost borne by society. It operates outside the market. Like any other measures to alleviate poverty, it reduces the incentives of those helped to help themselves, but it does not eliminate that incentive entirely, as a system of supplementing incomes up to some fixed minimum would. An extra dollar earned always means more money available for expenditure.[/i] en.wikipedia.org/wiki/Milton_Fr … income_tax

He was an advocate of UBI, essentially.

[i]Drug policy
Friedman also supported libertarian policies such as legalization of drugs and prostitution. During 2005, Friedman and more than 500 other economists advocated discussions regarding the economic benefits of the legalization of marijuana.[97]

Gay rights
Friedman was also a supporter of gay rights.[98] He never specifically supported same-sex marriage, instead saying “I do not believe there should be any discrimination against gays.”[99]

Immigration
Friedman favored immigration, saying “legal and illegal immigration has a very positive impact on the U.S. economy.”[100][/i]

Looks like a Dem to me.

Capitalism rewards luck and the talent of exploitation. The guy who finds ways to exploit the most people is rewarded most.

If ILP is a state, then fees are more like a flat per capita tax. I’d say that gives a sort of ‘ownership’, even if under the law there is none. For ILP-as-service, fees are like rent.

Yes, though I think it’s less than it would be if I were profit-maximizing through ads. For one thing, if we were ad funded, lurkers would be just as good as participants in terms of revenue. If you made posts that generated a lot of page views without generating a lot of discussion, that would still translate to increased ad revenue. So I’d not only want you participating, I’d want you tapping your social network to drive traffic this way. Again, that isn’t real ownership, but it’s strong effective ownership; I’d have a stake in people feeling like they own the site in the same way that people feel like they own their Blogger blogs.

(This is an idiosyncratic meaning of ‘ownership’ that only applies in the ILP-as-state metaphor, and in the way that citizens own the state. In a literal sense, under US law (and most other countries’ law as I understand it), users own their posts and ILP has a license to display them. Disclaimer: IANYL.)

I was referring to resource curse, although I thought that was more widely accepted than it appears to be.

I am surprised to see Venezuela classified as not-socialist. I don’t think the definition is necessarily unreasonable, though I would object that our political systems should be defined based on the policies they employ rather than on the outcomes. A laissez-faire economy that results in an equitable distribution doesn’t become socialist. I would define Venezuela as more socialist, since state ownership and control of industries is the policy.

I agree that it depends on the quality and views of the community, which is a large assumption and one that needs to be revisited regularly. When I dream of unrealizable karma systems, they are weighted so that highly-ranked users have a larger say than lower-ranked users, and staff would lightly manipulate the rankings to guide the outcome (e.g. by boosting quality users’ ranks and demoting shite users’ ranks).

The model works very well for the original purpose of StackOverflow, i.e. specific technical questions with more or less objective answers. Jeff Atwood is pretty honest about the goal being to gamify the creation of a wiki, and from my experience (coding, troubleshooting ILP’s server, using a linux desktop), the result is an invaluable set of answered questions for commonly encountered problems. For a more open ended discussion, and for topics like philosophy where there isn’t always a clear right answer, it’s a very bad system.

But it is worth noting that, if I do ever get around to bringing ILP up-to-date, it will be by moving to another Atwood project, Discourse. It does have some of StackExchange’s karma-based permissions system, which we probably wouldn’t use, but the other features are solid, and theory behind the choices is very much what I’d want to see in a replacement for phpBB.

I disagree. Nothing against anyone else’s preferences or mode of expression, but I sometimes regret adding the [youtube[size=100]][/size] tags. I don’t want ILP to be an independent venue for Youtube comments, and I find that when I post something and someone responds with a video, I lose all interest. And don’t get me started on picture heavy threads, I think I can count the number of times a picture has added anything to a conversation here on one hand.

I recognize that both of these opinions are obnoxiously biased; I know that I’ve linked to videos and embedded pictures, and it always feels justified when I do it. But truth be told, I prefer to write in a terminal window, my aesthetic is minimalist, and I would rather no videos or pictures than more. I know I’ll have to cave on that, but I will never stop complaining about it.

(and, having said the foregoing: you can point to a specific place in a video by including a ( \texttt{&t=###} ) on the end of the URL, where ( \texttt{###} ) is the position in seconds in the video. If you click ‘Share’ below a video, there’s a box at the bottom of the pane that says “Start at ___” that will autopopulate with the timestamp you’re at when you click it, but you can change it to any other time stamp and it will autogenerate the URL with the right ( \texttt{&t=} ) value.)

Not very much, I think. It’s capitalism-within-capitalism, in that there’s this competition for attention and production across all websites, and it isn’t clear that within that larger game, a website that has a lower-level set of competitive games is going to be the most appealing; a rational actor should choose the site that gives the most for the least work and then leave when the resources are exhausted.

Definitely, but I probably just would have screwed it up differently. I think Serendipper has a point about mobile, our mobile interface is terrible, and even that was a late addition.

But I also think the internet landscape has changed, people use fewer sites than they used to, they read and write shorter-form contributions and less linearly, they polarize more towards their tribes and avoid people they disagree with. In ILP’s heyday, there were a lot of people desperately looking for political and religion and philosophical disagreement in the form of conversations. Now, sites are primarily trying to shut that disagreement down at the behest of users. That’s a real cultural change, and a site like ILP doesn’t cater to it as well as it did to the longer-form, pro-disagreement culture of the earlier internet. We’re a throwback, and that would still be true if we’d done anything short of changing what we’re fundamentally about.

But the fee itself doesn’t confer ownership. The amount of influence I have in government doesn’t change in proportion to the amount of tax I pay. So ILP-as-a-state, I have no control and that would not change by virtue of a tax.

If ILP is a service charging a fee, then I’m purchasing something: citizenship. As a State, I’m a citizen regardless if I pay the tax, but as a Service, I’m a citizen only if I pay the tax.

Interesting. So, what exactly is the “capital” to you? I have some say of the means of production by virtue of the content that I’m producing, but I’m not clear on what the gain is. It’s not money, since there are no ads, so what is it? And are you exploiting me to accumulate it?

ILP could only be considered capitalistic if the users are being exploited for some type of “profit” that isn’t agreed to by the users. And the leverage used to exploit would be the competition narrative that there aren’t better places to go.

I submit that a laissez-faire economy cannot possibly result in an equitable distribution as there is no mechanism for it.

I’m interested in the evidence for that.

This quora answer received 91 upvotes:

[i]No; Venezuela is not a socialist state in the sense of having its government officially and constitutionally bound to socialist construction (this is what a “socialist state” means in the the Marxist-Leninist / Communist sense). At most, a socialist party, the United Socialist Party of Venezuela, held a majority in the National Assembly from 2000 to 2015 and two of the country’s presidents have belonged to this party.

Now let’s turn to the question you probably intended to ask: does Venezuela have a socialist economy?

The answer to this would unequivocally be no. The dynamic of capital accumulation still drives economic activity, most enterprises are privately-owned and profit seeking, the wage-labor relationship is still in place - and even more fundamentally - Venezuela operates in a global capitalist market system.

The government does intervene with the process of capital accumulation and with market processes and does create a negative and uncertain atmosphere for business in the name of fighting corruption and serving the needs of “the people”. But it hasn’t erected a new system to replace capitalism - nor could it accomplish such a monumental task on its own. At most Venezuela is a mixed economy with anti-business government policies that distort markets and retard growth.[/i]

But even if it were true that the government owns the means of production, I would simply ask who owns the government. If the people do not own the government that owns the means of production, then it’s not socialism, but explotation, ie capitalism.

I still maintain that Venezuela is THE most capitalistic place on the planet; the people have no control over anything and are exploited for profit more than anywhere, as evidenced by all the turmoil in spite of having the world’s largest oil reserve.

Chomsky said we impose capitalism on 3rd world countries to destroy them.

Oh lordy… the tyranny of the minority lol. A physics guy with 60,000 rep on stack exchange deleted my question about whether a motorcycle sprocket-set of 11/33 or 13/39 would put more power to the ground because he couldn’t see past the fact that they’re both 1:3 ratios in order to take into account friction and chain weight. I was stunned that he could have accumulated that much reputation while being completely void of open-mindedness, especially to the fact that he might not know everything quite yet. Narcissism is an attribute of the ignorant and where karma accumulate exists, there will be the egotists at the top of the pile dispensing arrogance. I believe intelligence is a function of humility and I don’t see how karma points selects for that trait.

Yes, I think you nailed it there.

I don’t know what that means.

Yes but anyone can post nonsense whether it be in picture form or text. If you peruse my threads I think you’ll agree that pictures and video are essential to my conveyance strategy. And I don’t just post a video, but give FWD instructions to specific times and also usually include a transcript. I do everything in my power to get what’s in my head into your head, and hindering modes of expression is hindering that conveyance, all for the sake of a few hoodlums that annoy you. It’s not worth it.

I tried that in the past and it didn’t work. I click share, click the “start at” box, copy the link, post it here and it still displays the video from the beginning, ignoring the starting time. At least, it did when I tried it. Perhaps I’ll try again. I’d have much less to complain about if I could post a cued video.

Interesting question. I’ll try to answer, but I admit I’m struggling to maintain the metaphor here. Let me start by distinguishing local and global capital, i.e. local capital is within-ILP capital, as if ILP were a state with a coherent local economy. Global capital is real world capital, the actual value of ILP to anyone in the actual global economy. Fair warning: reframing things this way may end up changing some of my positions.

Locally, capital is just social capital. It’s produced by quality and quantity of posting, and mostly accrues only to the individual. Social capital means more attention, good posters get more views and more responses, and probably also higher-quality responses. It also gets access and favorable exercises of discretion from staff, and occasionally can be exchanged for tangible power in the form of a moderator position and a small fiefdom (and I do mean exchanged, mod powers come with a significant social capital penalty). By default I think I get some of that capital, since a productive forum reflects well on me, but my own contributions can change perception from the forum being productive because of me to it being productive in spite of me.

Globally, the capital produced is also mostly social capital. Users get a body of work they can point to or draw from, practice writing and arguing, and the cache of saying we Discuss Big Ideas For Fun. Again, I’m parasitic on that social capital (e.g. I credit ILP with getting into a good law school: I talked it up in my personal statement). There’s also some financial capital produced, since, even though I don’t monetize it now, I could monetize it in the future, or sell it to someone who wants to monetize it. It’s not ever likely to be worth enough to do that, but it’s a mark of pride that it’s worth >$0. So, in practice, that’s still social capital; it might be most comparable to art or charity in that regard. It’s a part of the ‘attention economy’, so it does compete for eyeballs, and those eyeballs translate to more social capital. And like many of its larger and more polished competitors, it’s a loss leader.

I agree with this, but it’s beside the point. I raise the possibility only to say that socialism is defined by policies, not by outcomes.

That quora answer seems pedantic and evasive: the distinction between ‘being a socialist state’ and ‘being under the control the United Socialist Party of Venezuela’, or between ‘being a socialist state’ and ‘having a socialist economy’, is not really material to the question. It reads like someone who really wants to say no, and is looking for all the reasons why the answer is technically no.

I acknowledge there’s debate about this:
No, Venezuela doesn’t prove anything about socialism
Yes, Venezuela Is a Socialist Catastrophe
In socialist Venezuela, a crisis of faith not in just their leader but their economic model

Probably what’s happening is that people are using very different definitions of socialism, so let’s be more specific: Venezuela has significant, inflation-financed public spending, currency and economic control, low protection for private property, and effectively nationalized a large portion of its economy (i.e. oil production). Do we agree those are bad policies that should be rejected?

This is too slippery. We can’t rely on a system’s failure to be a sustainable economic and governmental system to argue that the failure is actually with whatever system it inevitably turns into. If (and I really mean this as a conditional, I’m not claiming this is so: IF) every time we implement the policies we would call ‘socialism’, we end up with a corrupt elite who use the government as their piggy bank, the right answer seems to be to reject those policies, not to say “oh look, they aren’t socialist anymore, so this doesn’t count against socialism.”

There’s basically no way to get around this. Once the community is large enough that shaming doesn’t work, you can have tyranny of the minority, or tyranny of the majority, or no holds barred.

  • Discourse is software made by (some of) the people that made StackExchange. It’s the most likely replacement for the current software ILP uses (but leaving things as they are is by far the more likely).
  • It has some karma systems built in, but I’m not sure if or how we’d use them (even assuming we made the jump, which is unlikely).
  • It has other design choices that are based on an overarching philosophy of how software can shape user interaction. It’s the same philosophy that was brought to StackExchange, but instead of the goal being to create a wiki, the goal would be to support good conversations. Plugging a different goal into the philosophy gives a different result, but there are clear similarities (e.g. gamifying good conversations using karma).

I agree that the best, clearest communication online probably uses all modes. But that doesn’t mean that encouraging or even enabling the use of all modes necessarily increases the quality of communication on average, and particularly not of academic-tone philosophy communication.

I can confirm that the advice I gave is worthless, please disregard. I might be able to fix it, but I make no promises.

So social capital is the currency, and you exploit us for knowledge, and we exploit you for the framework in which to dispense it, which together constitutes social capital that anyone can spend. That seems more or less communal.

That would mean the definition of socialism is arbitrary if not based on outcomes.

Really? I didn’t get that impression.

Stated points arguing against socialism:

  • The dynamic of capital accumulation still drives economic activity. ← Definitely not social, but the opposite.

  • most enterprises are privately-owned and profit seeking. ← Not social, or at least not communal.

  • the wage-labor relationship is still in place. ← Exploitation of the worker = not social, but capitalism.

Stated points arguing for socialism:

  • The United Socialist Party of Venezuela, held a majority in the National Assembly from 2000 to 2015 and two of the country’s presidents have belonged to this party. ← People wearing socialist labels supposedly constituting evidence of socialism. If that is true, then writing “hotdog” on a turd would make it a hotdog.

  • The government does intervene with the process of capital accumulation and with market processes. <— Government intervention benefiting the few over the majority is not evidence of socialism. That was the point I conceded to KT when I argued a capitalist does not want a government, but there are too many ways the government is used to further the accretion of capital into the hands of the capitalists. Since government is a tool to be used by anyone, most often the capitalists for the purpose of exploitation, then government involvement is evidence of nothing. I’ll elaborate about this point more later.

Then how would they answer it if they wanted to say yes? Deny the wage-slavery exists? Deny that private enterprise exists? How could anyone with genuine intellectual integrity argue that venezuela is socialist if such argument hinges on denial?

I can’t read that one without paying $1 because “democracy dies in darkness unless we receive $1”. If Wapo were worried about shining a light in darkness, they wouldn’t be panhandling for $1. Anyway, I tried 2 browsers and then a 3rd was rejected for having adblock, so I’ll have to wait for next month to see 3 more issues of their particular spin on things since I’m too proud to send the richest man on earth $1.

Now this one I can read and it reads like a hellish bent:

Government spending on social programs? Check: From 2000 to 2013, spending rose to 40 percent of G.D.P., from 28 percent.

Not according to data from the world bank:

Raising the minimum wage? Check. Nicolás Maduro, the current president, raised it no fewer than six times last year

It checks out: bloomberg.com/news/articles … me-in-2018

[i]Venezuela’s President Nicolas Maduro ordered a 150 percent increase in the monthly minimum wage, the sixth hike this year, to 4,500 sovereign bolivars from 1,800.

The increase will go into effect Dec. 1, while the price for the Petro cryptocurrency will rise from 3,600 sovereign bolivars to 9,000, Maduro said on state television. The minimum wage is pegged to the Petro price. At the black market rate, the new minimum wage comes out to $9.50 per month.[/i]

$9.50 per month??? That’s a minimum wage? They may as well not have one.

An economy based on co-ops, not corporations? Check again. As Naomi Klein wrote in her fawning 2007 book, “The Shock Doctrine,” “Chávez has made the co-ops a top political priority … By 2006, there were roughly 100,000 cooperatives in the country, employing more than 700,000 workers.”

So, 700,000 workers working in co-ops in a country with 32 million means what?

The NYT spinmeister runs out of ammo there, but keeps spinning:

Government overspending created catastrophic deficits when oil prices plummeted.

Funny how government overspending only affects places like venezuela. According to this Japan spends more relative to GDP than any country on earth.

Venezuela is so far down on the list I had to use “find” to find it.

Yet Japan has a strong currency and no inflation.

Worker co-ops wound up in the hands of incompetent and corrupt political cronies.

Oh, well, then what was the point of bringing up co-ops in the first place?

The government responded to its budgetary problems by printing money, leading to inflation.

Explain Japan please! No one has printed more than Japan, yet no inflation.

Price inflation is a function of supply of product and demand for product. Period. Money supply is not a variable in the equation except to the extent that it affects demand. The price inflation (money deflation) in Venezuela is a result of fear causing people to demand more products, which drives the price higher. People are so worried about the value of their money falling that they can’t wait to get rid of it, and in so doing bring about a self-fulfilling prophecy. Also couple that with supply restrictions, thanks to the US, mainly.

Venezuela: Overview of U.S. Sanctions

No wonder Chomsky said “We impose capitalism on 3rd world countries to destroy them.” viewtopic.php?f=3&t=194766&start=50#p2720985

Wapo again.

Not that I can identify. See world bank chart above. According to world bank data, Venezuela spends the least publicly, relative to GDP, out of every country on earth.

Probably as a result of US and EU interference.

Not that I can identify.

[youtube]https://www.youtube.com/watch?v=trT51Ykqe8k[/youtube]

Nationalism doesn’t = socialism.

Libertarian socialism (also known as socialist libertarianism)[1] is a group of anti-authoritarian[2] political philosophies inside the socialist movement that rejects the conception of socialism as centralized state ownership and control of the economy.[3] Libertarian socialism is close to and overlaps with left-libertarianism[4][5] and criticizes wage labour relationships within the workplace,[6] instead emphasizing workers’ self-management of the workplace[7] and decentralized structures of political organization. en.wikipedia.org/wiki/Libertarian_socialism

State ownership of the means of production is simply “state capitalism” where the state becomes the monopoly of ALL production. It would be like Amazon owning everything and changing its name to “the government”.

If you’re 1/300,000,000th owner of your own factory that employs 30 people, what influence do you have? Zero.

See my thread: The defamation of socialism

[i]It doesn’t have anything to do with socialism. They destroyed socialism within weeks! You know. They didn’t wait. By 1918 it was finished. And they knew it. You know. Like, it’s not a secret; they knew it. I mean, in fact, Lenin as soon as, you know, as soon as he sort of got grips of things, he moved to what he called “state capitalism”. Which is what it was. It had nothing to do with socialism.

Socialism… I mean we can argue about… there’s no point arguing about what the word means, but what it always meant at the core was that producers take control of production, working people take control of production: what’s sometimes called industrial democracy, that was the absolute core of it. Well, you know, there was more socialism in Germany, in Western Europe, than there was in Russia.

No, Russia’s about the most anti-socialist place you can imagine, since 1918. It had wage-labor, had super-exploitation, had no element of worker’s control or involvement or participation. What’s that got to do with socialism? It’s the exact opposite on every point.

As I say, the West liked to call that “socialism” while laughing at the fact that they called themselves “Democrats”, but that’s for purely propaganda reasons. I mean, unless you’re committed to being part of the Western propaganda system, there’s nothing to say about that issue, except to laugh.[/i]

I’ll let Chomsky answer that: What ideology? The ideology of totalitarianism? Yeah it’s deeply flawed.

The point is not to label them socialists to start with since they’re not even socialist in theory because 1/300,000,000 ownership could never confer any control over one’s own local environment. As Chomsky said, the reason they labeled these systems “socialist” was to garner appeal from the people who wanted “socialism” and the reason the West labeled them “socialism” was to demonize socialism so the people don’t get privy and start demanding it. Propaganda is a necessary tool of control in a “free society”.

I guess you’re right.

Depends if ILP is a community of mediocrities.

Yes, though perhaps it is even better described as symbiotic than communal. ILP might be compared to the cleaner fish that attract sharks to a cleaning station, or to a tree that attracts bees with its flowers: the site and its users both benefit from the arrangement, but not because of an exchange per se, but because one’s benefit is a byproduct of the other’s benefit.

You can use private browsing/incognito mode to circumvent this.

If you google the phrase “state ownership of the means of production”, the top result is the Wikipedia page for state socialism, which tells us something important. Indeed, that page makes the point explicit:

The point is not that some set of policies is really socialist or really capitalist, it’s that the labels “socialism” and “capitalism” often behave more like team colors than like actual coherent sets of policies, and are thrown on things that everyone agrees are bad in order to sully the opposition. As you note in response to my critique of slipperiness, it’s fair to ask if people who were called socialist and who ended up turning the government into their personal piggy bank were ever really socialist, and so if their institutions fail or are co-opted, it’s fair to say that nothing they did reflects on the team whose colors they wore. But the capitalist can play the same game with captured governments and wage slavery.

But then what is really the disagreement? We may sport different colors and argue passionately whether team blue or team red is best, but we may at the same time have in mind a very similar set of policies that we think will optimize for a very similar set of outcomes, and just call our shared position ‘capitalism’ and ‘libertarian socialism’, repectively. I suspect that what Beto has in mind when he calls himself a ‘capitalist’ is not what you have in mind when you call a captured government that benefits the few ‘capitalist’, and that in fact his idea of capitalism is closer to your idea of socialism than to your idea of capitalism.

So going forward, I’ll dispense with the question of whether Venezuela is socialist. But for completeness and etiquette, I’ll respond to your points more concretely.

The dynamic of capital accumulation is inescapable, for a reasonably broad definition of capital.

Private ownership and profit seeking are good, and benefit society as a whole when undertaken in a market that protects a certain minimum of rights to ensures that exchanges are voluntary.

Wage labor is not the same as exploitation of the worker where the exchange is voluntary.

It is evidence of lots of things (apologies, I know you meant evidence of nothing in terms of whether a state is socialist or capitalist, and I am taking your words out of context).

As I said in another of your threads on socialism, I think that you are not being careful with this data. You can only get a ceiling on government spending as a percentage of GDP from this number; GDP includes more than private consumption and government spending, it also includes investment and net exports. When exports fall (as they do for an oil exporting country when the price of oil falls), that shows up as an increase in private spending as a percent of GDP, but not because government spending has fallen. This also appears to be official government data, which for Venezuela is, I think we agree, an unreliable source. And it is probably based on a manipulated currency; I hope we also agree that the official exchange rate is not he same as the real rate. In Venezuela, the government has effectively nationalized significant parts of the economy, even though on paper they remain ‘private’. I don’t know how that affects this calculation, or whether businesses are even included in this. Similarly for “non-profits that serve households”, that concept may not be meaningful in a manipulated economy with rampant nepotism; for example, if the co-ops are scored as non-profits, their spending may count as private consumption, even if they are heavily government subsidized.

Per capita GDP in Venezuela is less than 1/3 of what it is in the US, and the minimum wage is almost 25% higher. By that measure, it would be equivalent to a $33 minimum wage in the US.

It’s similar to how debt financing works very well for a person with a steady income, and not so well for a person without a steady income. Venezuela has a precarious economy dependent on a fickle resource. When oil prices were high, debt spending worked. When they fall, Venezuela is not credit-worthy and can’t borrow to cover its spending. The US and Japan, both of which are significantly leveraged, have stable and diversified economies, so borrowing to spend is not as a big a risk.

I would also say that there is a difference between inflation financing and debt financing. Printing money and borrowing money have different macroeconomic effects.

That is a significant caveat. Where the money supply is increasing due to printing new money with nothing backing it, the demand for the money falls precipitously.

But price inflation in Venezuela is due in large part to price controls, which always and everywhere lead to scarcity and expensive black markets.

I agree that sanctions are bad. Free exchange is a source of stability and peace, and sanctions harm ordinary citizens to punish the bad acts of their leaders. They’re destabilizing and cruel.

This seems conspiratorial. We have good evidence that 1) price controls are official policy, and 2) price controls lead to shortages. Did the US or the EU push price controls on Venezuela? What evidence is there of that?

This video is not very useful. From it, we learn that there is at least one operating shopping mall in Venezuela. But if 100,000 co-ops mean nothing, one shopping mall means 1/100,000th of nothing.

I would suggest that this supports my position on the utility of other forms of media to inform a philosophical discussion:

I don’t think it does. Even if the best communication possible has multiple media involved, it does not follow that most communications can be improved by substituting some part of the writing for pictures or video. This is as true for luminaries as for mediocrities.

It is significant that many of the pictures on Twitter are screenshots of text (this is certainly a biased view based on my particular timeline, but I follow mostly academics and public intellectuals). Given the ability to easily add images, people quite often (I’m tempted to say ‘usually’ among my follows; a quick scroll bears this out) use that ability to add more text, rather than to add a picture. Images and videos are more often used for comedic effect than for information. Another use is pictures of people mentioned in a tweet, e.g. politicians saying ‘great meeting with So-and-so’, or academics saying ‘come to a talk by So-and-so’, over an image of So-and-so. What seems to me like the most value-added use is charts and graphs, which add a lot of unambiguous information.

Yes, I considered using the word “symbiotic”, but chose “communal” in keeping with the theme.

Hey I learned something! Thanks man :slight_smile:

I acknowledge that it is much like team colors, but somewhere my point that “state socialism isn’t socialism even in theory” got overlooked. The blue team is called blue even though it’s wearing red.

Lenin himself said “For socialism is merely the next step forward from state-capitalist monopoly. Or, in other words, socialism is merely state-capitalist monopoly which is made to serve the interests of the whole people and has to that extent ceased to be capitalist monopoly.” marxists.org/archive/lenin/ … tci/11.htm

So what is the proposed mechanism for this social service? Apparently a “benevolent” dictatorship that is magically immune to corruption and capital accretion tendencies. That implies that the people themselves do not know what’s good for them and need have no control over anything, evidenced by what actually happened the three famous times that system was implemented (Lenin, Stalin, Mao).

Chomsky said, “We should recognize what I think is true, I’ve written about it plenty myself, that the Bolshevik Revolution, was really a coup, was really a counter-revolution, which placed state power in the hands of a highly authoritarian anti-socialist group which within a couple of months had destroyed the factory councils, had destroyed the Soviets, had dismissed the Constituent Assembly (because they knew they were gonna lose) and have eliminated every popular movement; and had done exactly what Trotsky said: turned the country into a labor army under the control of the maximal leader. That was mid 1918. And since then there hasn’t been a shred of socialism in the Soviet Union!” ilovephilosophy.com/viewtopic.php?f=3&t=194777

The underlying principle substantiating the socialistic aspect is based on magic which is not even theoretically sound because if it could be true that a capitalist monopoly could be benevolent, then why fight capitalism?

Outside of employment and usury, capital accumulation would be difficult. If everyone were reliant only upon what they themselves could produce, then it would be very difficult to produce twice as much as any other average human with the same motivation.

I agree. Co-ops are privately owned and profit-seeking, so private property and profit are not the test for capitalism since nothing but one’s own labors are capitalized upon. The test for capitalism then appears to be the remaining element that is excluded by worker co-ops, which is the capitalization on the labors of others.

All wage and salaried labor is exploitation (unless the wage/salary is higher than their productivity, which it sometimes is, typically in management). I started a thread on this topic ilovephilosophy.com/viewtopic.php?f=3&t=194727

The wage is only voluntary if the worker agrees to the division of his own productivity instead of being compelled to accept the wage based on his/her other options, which may or may not include starvation.

Wage-slavery is the mechanism by which capital accumulation happens. If you want to be rich and pull away from the herd, then you’ll need lots of employees donating the bulk of their productivity to you, and the less alternatives to that arrangement the employees have, the faster you’ll accumulate wealth, so it’s in the interest of profit to not let the people get too prosperous lest they have too many “other options”.

Government involvement works best for society when it’s in competition with the private sector, not when it takes over the private sector. Government is the governor that restrains the machine from destroying itself, like the spinning things you see on top of steam engines.

Oh crap, I never knew you posted in that thread. Sorry about that. I’m usually pretty thorough about replying, but that post must have slipped through the cracks on the page transition.

True, the equation is GDP = C + G + I + NX, where C = private consumption, G = government consumption, I = private investment, and NX = balance of trade (exports - imports). But the balance of trade is negligible tradingeconomics.com/venezuela/balance-of-trade and I have no way of quantifying private investments. Still though, no matter how the numbers are sliced n diced, the prevailing trend suggests the more private expenditure, the more the economy is in turmoil. Even a country like Saudi Arabia with a balance of trade of 25% GDP still only has 40% private consumption and an advertised 20% government consumption putting it on par with Sweden which has 44% PC and 25% GC but with negligible balance of trade. So private consumption appears to be a fairly reliable metric for judging overall social spending in spite of any differences in the trade balance.

Sure, I agree there. But if Venezuela spends privately anything near the 70% that the US does, and with negligible balance of trade and assuming any private investment whatsoever, then what’s left for social spending? So even if the government numbers are horribly inaccurate, the tolerance band is still falls within the capitalistic/anti-socialistic category.

I’m not sure who is powerful enough to manipulate exchange rates. No bank in history was ever been able to conquer the market, not that I’m aware of, and defeating the BOE is what made Soros so rich. I suppose that the only one powerful enough and with enough interest to bother with manipulation would be the US, once again. Chomsky characterizes Venezuela as a US colony ever since the British were booted out under Woodrow Wilson after oil was discovered. youtube.com/watch?v=sjVHUEI_0-o (about 1 minute in)

That sort of speculation doesn’t seem to argue in favor of a social good to me. If on paper they are private, but secretly in the control of totalitarian entities, then I don’t see the difference in terms of society’s interests; to me it’s still capitalistic.

Co-ops are self-regulated for-profit private entities, so they should be considered as ordinary businesses. A worker co-op is simply a worker being paid a % of profits instead of a wage.

Well, Max Blumenthal purchased 4 chocolates for $1 in the mall, so the minimum wage is 38 pieces of chocolate per month. Chocolates in a shop like that in the US probably costs about the same. But even if $33 is correct, $33 per month isn’t a minimum wage.

But Venezuela is sitting on the world’s largest oil reserve; that’s not enough collateral? And Japan is?!? So 20% of GDP for Venezuela is expensive, but 200% of GDP for Japan is cheap? Japan is a country of a declining population of elderly with no natural resources to speak of and no indication that 200% of GDP is anywhere near an end. Japan essentially monetizes its entire bond market! By all logic, the yen should be toilet paper.

Borrowing money just means the treasury issues and auctions bonds; anyone can buy those bonds including the central bank by printing money. Right now the 10yr is held steady at around 10%, probably held down by the central bank putting a floor under bonds. tradingeconomics.com/turkey/gov … bond-yield

The only thing that could ever back money is faith. What’s “supposed” to happen is the central bank prints money to give to the consumer who then bid prices up with the extra cash, and in that way seemingly devalues the money, but what actually happens is the money is given to the rich where some trickles down to consumers who aren’t able to bid prices up as high (ie japan), and where the rich bid the prices of investments like stocks and real estate because they don’t know what else to do with all the money, so the stock market explodes, the housing market prices the poor out of homes, and any money that trickled down is simply used to barely get by and the central bank still sees no inflation because it’s looking in the wrong place and giving the money to the wrong people.

Sure, price controls probably has some effect, but the underlying mechanism is supply and demand where the demand is coming from irrational fear of a deflating currency; as soon as anyone gets a bolivar in their paw, they immediately run to the store and spend it before it loses more value. Wouldn’t you? As long as people keep doing that en masse, inflation will keep charging higher, especially if supply is being restricted as well.

Idk, the US has 1.4 billion pounds of cheese in storage from trying to keep the price high. vox.com/science-and-health/ … ion-pounds

Right, so this is a problem caused by the US, for obvious reasons (oil and to be able to demonize socialism).

I was addressing the currency part of it. The only entity big enough who would care is the US (and maybe the EU).

Yeah, but from within the video we learn that Venezuelans themselves say there is no socialism there. He also took his evidence to the UN youtube.com/watch?v=WZ1vFlX5jEw

Suppose I appear in court saying “I have video evidence, but I left it at home since I didn’t want to bore anyone and figured it would portray me as unacademic, so if you’ll just take my word for it, that would be great!”

And there is a lot of philosophical insight to be gleaned from cartoonish videos. The videos Trixie posted that seemed to cause such a stink around here actually turned me onto DarkMatter2525 who I now consider a talented philosopher who uses art as a conveyance. On one hand you’re telling me there really are no rules and that you’d be a fool to stand in the way of novel-but-frank presentations, then on the other you seem to be dictating the form information should take.

I agree this happens, often, for socialism. But I see a lot of your descriptions of capitalism in the same way. Are there self-identified capitalists out there saying we need wage-slavery? No, at least no more than there are socialists saying we need to the state to seize the means of production. You also describe as capitalistic a system where “on paper [companies] are private, but secretly in the control of totalitarian entities” – what capitalist is advocating for this?

Are non-human primates capitalist? Many non-human primates have highly unequal societies, where elites reap a very high proportion of the available resources through a form of social capital. Similarly in humans, status hierarchies are often very unequal without employment or usury (e.g. high school). And given the late development of usury and the historical prevalence of exploitation and elite resource concentration, it seems incorrect to say that usury is causally necessary.

I haven’t read your topic discussing this more fully, I’ll take a look.

If everyone were reliant only upon what they themselves could produce, everyone would starve… Which on reflection seems to me a point so obvious that I must be misunderstanding you. Does total self-reliance exclude mutually beneficial exchanges? What do you mean when you say “capitalization on the labors of others”? If I need someone to sit at a desk for eight hours, occasionally answering the phone, and they are willing to sit at a desk for eight hours and occasionally answer a phone in exchange for money, am I capitalizing on the labor of others? Is that person relying on what they themselves can produce?

But there are two sides to an exchange, so the wage can be less than the productivity from the perspective of the employer, and greater than the productivity from the perspective of the employee. It’s not just that I can’t sell my time and effort for more money elsewhere, I can’t use my time and effort to improve my life more than I can by selling my time and effort in exchange for money that I can spend to improve my life.

That isn’t true for everyone, but it is true for almost everyone, and it can be true for everyone. The goal should be to fix the places where it isn’t true, rather than to destroy the places where it is true.

I agree that this is a good vision for the role of government. Another that I like is that government is the lattice on which the vines of society grow – Government structures society to let humans’ innate tendencies work together and let society grow.

No worries, I was late to the party and not responsive to where the conversation was at the time.

I think this is true, with the caveat that the data provided is private consumption. It is often said that money is an IOU, and in that framing it makes sense that cashing in a bunch of IOUs can put a country in a worse position (because fewer IOUs means less ability to take risks and weather volatility). Where expenditure is on investment rather than consumption, one is generally left better off. Indeed, it seems we should expect consumption to be the worst indicator for economic health of the four included in GDP, increasing in response to disaster, instability, inflation (as you noted), etc.

This seems in tension with your claim that “government involvement is evidence of nothing”.

A national bank should be. But it can also be manipulated by regulating prices at which goods can be sold. Shortages are the result of artificially lowering the price of goods. Apparently Venezuela does it by regulating the price of imports and foreign currency exchange.

I apologize, I somehow missed that it was $9.50 per month, probably because it is inconceivably low.

I do think it’s worth noting that this interacts with inflation and currency manipulation; the actual minimum wage is set in sovereign bolivars, and the $9.50 amount is at the black market exchange rate. There have been 25 minimum wage increases since 2013, during most of which the official exchange rate was very very low relative to the black market rate:

Wages here could be both chasing and driving inflation, like a rabbit with a carrot on a stick tied to its head (though it’s unlikely that wages are the sole driver of inflation).

In any case, I agree that currently appears so low as to be meaningless.

Yes, and that should be the expected result. Venezuela’s oil is worth less today that it was several years ago, as new oil sources have been developed and the price of oil has fallen. The manipulated official exchange rate makes it even harder to exploit, as do weak institutions, instability, and weak protections on personal property. Those latter factors mean investing time and money in developing a business buying and selling in Venezuela is risky. And that means investing in Venezuelan sovereign debt is risky. The value of anything is a function of risk.

By comparison, Japan isn’t vulnerable to the price fluctuations of a single commodity. It has strong, stable institutions, and predictable protections for private property and business. Building a business there has fewer unknowns, and the sovereign debt is thus reliable. Even the aging population, which will absolutely be a problem, is a pretty predictable problem that will unfold gradually and predictably. There could be a coup in Venezuela tomorrow, but there’s no risk of everyone over 70 in Japan dying at once.

If Venezuela has a coup, its bonds are probably worth zero. Even if there isn’t a coup, there’s a non-zero chance that they will default on their bonds. They have a face value that is only their actual value if they don’t default.

(Your link on bond values shows almost no trading volume for the past year, so I don’t think that price is particularly indicative of actual value. I think it’s more likely that the floor is preventing them from falling, rather than rising. I agree they should be allowed to track their actual market value.)

Given the chart above, it does not seem that the fear is irrational. (I assume you meant inflating currency; a deflating currency would be increasing in value)

This is the same point in the opposite direction: artificially high prices lead to overproduction and waste.

Highly meaningful, since political philosophy education in Venezuela is universal and high quality, and the definition of socialism is objective and not at all subject to disagreement :slight_smile:

I would say that, as a prior, we should assume that the average Venezuelan is about as well-informed about what it means to be socialist as the average American (the latter best summed up by the demand to “keep your government hands off their Medicare”).

“I have video evidence of the truth of utilitarianism” seems a less compelling claim! Discussions on ILP aren’t court cases, they are almost never subject to resolution by video evidence. A court is deciding whether and how a single event happened. Philosophy is abstracted as far away from single occurrences as one can get. Video evidence can refute claims like “X has never happened”, or “there are exactly zero functioning shopping malls in Venezuela”. That doesn’t advance very many conversations.

Even videos of Chomsky speeches are really just links to more words. A transcript of the video would do just as well to make the point that a guy who knows what he’s talking about said XYZ.

Sort of. Art contains much truth, but little rigor. It is also not very information dense. It can be very rhetorically persuasive, and can point the way to truths, but it doesn’t do a very good job of nailing them down or firmly establishing them.

I would argue that most of the philosophical insight to be gleaned from art is brought by the consumer of art, rather than conveyed by the art itself. In the light of a philosophical mind, almost anything bears insight.

Well, the most fundamental attribute of capitalism is the accumulation of capital; the freedom to be as rich as possible by just about any means and without interference from anyone. The spirit of the age: gain wealth, forgetting all but self. Greed is good. That’s capitalism.

So then, anywhere we can identify a division of wealth, it is taken as evidence that capitalism has occurred, because how else would it be that way?

So when I say “on paper [companies] are private, but secretly in the control of totalitarian entities” are capitalists, I’m not meaning that someone who considers himself a capitalist would advocate that, I’m saying that capitalism happened: ie someone capitalized on someone else. People who call themselves capitalists aren’t even sure what capitalism is; they could think it’s americanism or who knows what.

The essence of economics is answering the question of how wealth should be allocated to citizens and the various mechanisms for achieving it.

But there are only two ways of arranging money: either spread it around (by whatever mechanism) or condense it into few hands (by whatever mechanism).

President Franklin D. Roosevelt
July 2, 1932

There are two ways of viewing the Government’s duty in matters affecting economic and social life. The first sees to it that a favored few are helped and hopes that some of their prosperity will leak through, sift through, to labor, to the farmer, to the small business man. That theory belongs to the party of Toryism, and I had hoped that most of the Tories left this country in 1776.

The way FDR tells it, the trickle-down folks were the RedCoats, which makes Reagan a treasonous infiltrate along with the entire gop.

You see, the division of wealth is zerosum, like the stock market: no one can get rich unless someone gets poor. If we had a gold standard, that fact would be perfectly clear since if someone is amassing quantities of gold, then the gold is obviously coming from everyone else. What’s not as clear is the fact that printed fiat money created to enrich the rich also siphons wealth from the poor by diluting the money supply (ie inflation). If the Fed gives new money to Goldman Sachs, then your money is worth less and overnight wealth has been taken from you. So therefore every rich person is representative of a group of poor people; every rich city is representative of a poor city; every rich state represents a poor state and every rich country needs a poor county donating its productivity to the cause. The US is rich because mexico and china are poor. The Hamptons exist because Detroit exists. Look at Detroit and the Hamptons in 1950 and compare to today and it should be obvious like pushing down on one side of a waterbed makes the other side rise. How it became that way is what I’m calling capitalism: someone capitalized, somehow, on someone else, and that capitalization resulted in wealth disparity.

So the identification of capitalism is quite easy: just look for poor people. “Ah, mexico is poor, must be capitalism!” It can’t be socialism because there is no mechanism to run out of money by spreading money around to people; where’s it gonna go? Mars?

Ironic that “running out of other people’s money” only applies to capitalism: when the poor finally have no more money to pay the interest and profits to the rich, the economy crashes. In 2000, after everyone and their brother finally bought stocks, there was no one left to buy, so it crashed. In 2007, there was no one left to buy a house and after the inflation of $4 gas set in, people couldn’t afford to pay the interest on their loans and the stack of cards fell. I don’t know what’s holding up the economy now since the banks are tightening up with higher interest rates and the fed is draining money out. Maybe it’s the EU, BOJ and SNB.

But the reason periodic crashes plague capitalism is because of the transference of wealth from the poor to the rich where the poor inevitably run out of money, sparking a cascade of defaults.

It may be humorous to discover that I credit the existence of humans as intelligent creatures to the capitalization on animals. We use animals to process vegetation to extract B12, K2, and A which is evidenced by our small guts and inability, or reduced ability, to assimilate those nutrients ourselves. Animals have been our slaves for a long long time, and not just pulling plows. Likewise human slaves have served a purpose by doing the hard work which allowed others to concentrate on science and art, which was ultimately good for the species. I’m not necessarily condemning slavery, but merely, first of all, suggesting that we should recognize that’s what’s going on and furthermore, the reason said slavery is still existent is to provide billionaires with a few more billion… and I don’t see that as a good reason to continue to have slavery, especially in the age of mechanized slaves. All that continued suffering for no purpose is just dragging society down… to the point of reviving antiquated diseases.

Also, there is a good argument to be made about the ancient Egyptians having steam engine technology, but not pursuing it because human labor was too cheap. So therefore, if a government increases the costs of humans, it drives discovery of innovative ways around utilizing humans. And really, only a government could accomplish that., as evidenced by the Egyptians having steam technology but merely viewing it as a toy. I’m sure published research exists in these areas if you wish to pursue them (how social rights drive innovation and how animals were responsible for the development of our big brains). But I see it as an axiom.

No no, I’m not suggesting everyone should go into the hills and fend for themselves, but for instance if I found a way to produce $50/hr and I hire someone for $10/hr to do it, then becoming rich is just a function of adding more employees paying me $40/hr. If I do it alone, I’m only making $50/hr. But with 1000 employees, I’m making $40,000/hr… plus my $50/hr. I don’t know how huge lawfirms work, but I’m supposing all the lawyers are working FOR the guy at the top and his compensation depends on how many lawyers he has under him.

A secretary I could see as a luxury, in which case it’s philanthropic, unless they were vital to the business, in which case it could be exploitative depending on the compensation in comparison to the value added. I don’t know much about secretaries, but I’m guessing that many of them are probably paid more than what they actually contribute.

No the productivity is the amount of revenue the employee generates. In my case is was roughly $50/hr. So I’d hire a guy for $10 and it was his job to bring $50 in revenue per hour. There is no productivity from his point of view.

Yes all money is loaned into existence in our modern banking system. The easiest way to picture that is lending me $20 then I issue you an IOU which is worth $20 to anyone considering my credit good enough, which is effectively the creation of $20 from nothing. Then you could trade the IOU to KT for $20 and if I ever pay KT the $20, then the money supply is reduced by $20. So all bank loans, government borrowings, car loans, student loans, stocks purchased on margin, etc are creating money (and why defaults snowball quickly out of control as the money supply is reduced making it progressively harder not to default).

You might get a kick out of this: First National Bank of Montgomery v. Daly

Government involvement is different from government spending. I don’t know what government involvement means, but I do know what government spending means (it means regular people are getting money).

Yeah I guess so. But wouldn’t there also be a shortage if the price were too high? Not a shortage of product, but a shortage of ability to purchase the product, which is the same thing in the end. If the gov holds the price of milk down so cheap that shelves are empty, then I can’t buy milk. If the gov lets the price rise above my means to buy milk, then I can’t buy milk even if the shelves are full. This actually happens to me all the time: the local dollar store will sell milk so cheap that the shelves are usually empty. I’d rather pay an extra 50 cents and have milk.

But notice how the NYT guy used that as a point to substantiate socialism in venezuela. One has to wonder what incentive he has to lie. Is he just being patriotic to his team? Why is it so important that venezuela be regarded as socialism?

Yes, min wage in the US would be something like $1200/mo depending on hours worked. $9.50 is off by a factor of 126!

I’ve given this a good deal of thought throughout the years wondering why currencies inflate and I can only find a couple mechanisms: people have more money or they are scared.

Yes I watched the oil price fall at the end of 2014 and it was due to fracking, but mainly Janet Yellen et al cheerleading the USD higher by threatening to raise rates every chance they got, along with the treasury selling foreign reserves (ie buying USD back) and along with Japan launching QQE on Halloween. Not just venezuela, but lots of emerging markets took it on the chin.

So if manipulation is to blame, then what about china? China already is, and has been, the way everyone is trying to portray venezuela, including currency manipulation, price controls, you name it.

But the thing is Japan is monetizing its own debt, meaning it’s lending itself money to provide social services, and yet there are no catastrophic effects from the dreaded “socialism” monster.

[i]Japan, by far the most over-indebted country in the world in relationship to its economy, has decided that there will be no debt crisis. A debt crisis would force Japan to brutally cut its budget for social services and raise taxes by large amounts to make ends meet. Japan has decided that it would never come to that. Instead, there may be a currency crisis or an inflation crisis, or both, which would spread the pain more evenly.

Japan can weather this type of crisis better than other countries because it has a large trade surplus and a large pile of foreign exchange reserves, though it would whittle down the wealth and purchasing power of the people. So this type of crisis will be kicked down the road for as long as possible. And that could be quite a while.

What Japan will never have is a debt crisis since the government bond market is in total control of the BOJ. Given the extent of its control over the market, the BOJ can now ease up on buying these JGBs. But market forces will never be allowed mess with that market.[/i] wolfstreet.com/2018/10/08/banko … bt-crisis/

Yeah the bolivar is deflating and the USD is inflating along with the price of goods. The people are scared their money is becoming worthless, so they’re in a hurry to get rid of it before it loses more value. There is an idea floating around that the Fed wants to keep inflation at 2% so that people will not delay purchases for fear the price will be higher next year, which could be true, but that isn’t the reason they aspire for 2%. That number is just what they decided indicates healthy wage growth; if goods are inflating 2%, then people are making more than before, and that’s good. On the other hand, if prices are falling, it indicates people are making less.

Well, they don’t want the small farmers to go under. Is that socialism?

Particularly that guy sitting at the table motioning with his hand and head to drive home the most emphatic “No” possible. Communism? No. Dictator? No. Humanitarian crisis? A little bit.

If I could quote chomsky ad hoc without referencing the source then that would be much easier on me, I just figured I needed to prove he said the words.

And if text were sufficient, then why have professors giving lectures? Just issue books and tests. Part of the conveyance is the elaboration in the lecture in addition to what’s in the textbook, so that’s the job of pictures and video on a forum.

Sometimes it helps. You may think Noah’s Ark sounds ridiculous, but seeing the scenario animated definitely removes all suspicion of plausibility.

Yes I’ve said something like that myself: that more can be learned from the person’s reaction to art than about the artist by observing the art.

hey yo dip, you heard my economic rap before? this is some weak ass shit i did before i was gangsta, but it’s for educational purposes so i ain’t tryin’ to shake niggas up. now i ain’t got no degree in economics, but i got a good grasp on the basic problems, see. so im’a put it down in a song that can reach the peoples, na mean?

it’s in response to this absolutely brilliant video: youtube.com/watch?v=d0nERTFo-Sk

vocaroo.com/i/s1WgBAjgkg2T

my progression runs like this:

non-monetary bartering system works for a while
problem of the ‘double coincidence of wants’ forces the invention of money
mercantile system develops based on commodity backed money… works for a while
invention of fiat money and central banks
concentration of wealth results in periodic financial crisis and market crash

Cool video!

Regardless of ethics, here are the mechanics of the situation:

The regular Joe only has one source of income: his wage. But wages are a mechanism to transfer wealth up, not down.

Richard Wolff, professor of economics. en.wikipedia.org/wiki/Richard_D._Wolff

Alma mater
Harvard University (BA)
Stanford University (MA)
Yale University (MA, 1966; MA, 1967; PhD)

[youtube]https://www.youtube.com/watch?v=TXNrVaJJfHA[/youtube]

Transcript starting at 39:00

[i]So to keep the game going he has to replace the tools and equipment and he has to pay the workers, but he has to pay the workers… here we go folks: less than the value added by the workers when they work. Or to use the technical term economists like: he has to rip the workers off. He has to steal from them part of what their labor added.

You know what the lesson here is? For those of you who imagined that when you graduate from here you will get a job, in fact the only job you will accept is one that pays you what you’re worth. Uh… never gonna happen! The condition of your employment is that you produce more by your labor than you get paid. Welcome to the capitalist system!

The best way to describe your work in a capitalist enterprise is not that the employer gives you a job, it’s that YOU give your employer the surplus! The giver and getter are in reverse order from what the language suggests.[/i]

That is why wealth always trickles up in a capitalist system, and the system crashes when the wealth is exhausted on the bottom and consequently can no longer trickle up.

To prevent wealth exhaustion, the economy is required to continuously grow in order to provide new jobs to keep the consumer capitalized. That’s why recessions are big deals and stagnation isn’t an option.

Fundamentally, ALL money is loaned into existence and has an interest that must be repaid, but the interest doesn’t exist, so yet more money has to be created to pay the interest on the old money, which itself requires yet more money to pay that interest and so on forever, so the economy must keep growing and growing or it crashes… and that’s just from the interest-perspective, which ignores the fact that the rich are getting richer and competing for the same exhausted wealth that could otherwise be steered towards interest payments.

The two mechanisms sucking wealth upwards are interest and profit. If that is not balanced by redistributive taxation, then consumers must undertake their own debt until their credit worthiness runs out: mortgages, helocs, credit cards, auto loans, student loans… how much more can the consumer bear just for the purpose of making the rich richer?

The State of the American Debt Slaves

Accumulation is a byproduct, the defining feature is the private ownership of the means of production and its operation for profit. It also bakes in the concept of voluntary exchange, which significantly restricts the means through which one can earn profits.

If you and I own land of roughly equal value, and a meteor strikes my land and irradiates it to the point of no longer having any value, have you exploited me? We certainly have a difference in wealth, but you haven’t done anything to me, I had a run of bad luck and it cost me the value of my land.

This is false. Take a simplified stock market in a world with two companies and a virulent plague with no know cure. Each company is made of one person, and they are phrama startups trying to cure the virulent plague. Company L is lazy and stupid. Company M is motivated and brilliant. It isn’t zero sum which company people invest in, because if people invest in Company L, their money is likely to be wasted and society made no better off; if people invest in Company M, their money is likely to lead to a cure for the disease. There is a positive externality in the form of a cure for the plague.

This also shows that people can get rich without others getting poor. For this, we only need to look at global per capita GDP, which has been rising rapidly. People are materially better off all over the world, without some group being sufficiently materially worse off to offset the staggering gains.

This just seems like an unnecessary equivocation on the term “capital”. The predator-prey relationship is not a market transaction.

Take an employee on an assembly line, whose job is to take a washer from a box of washers and place it on a bolt as the widgets pass by. That employee sitting in a field, picking out washers and placing them on bolts, is not doing anything of value. That employee sitting on an assembly line and doing exactly the same thing is doing something quite valuable. There is no fixed value to the labor.

Similarly, say person A has a bike with one wheel and a car tire, and person B has a car with three wheels and a bike tire. They exchange the wheel for the tire, and both people are bad better off, even though neither has made anything. Value has been produced without anybody making anything.

It just seems like Daly is being disingenuous and bamboozling a jury full of bumpkins. Not surprisingly, he also seems to have believed that taxes are theft.

My intuition is that such a situation could not last, unless the price were not permitted to fall. If the price can move, then a rational seller should lower the price as the demand falls.

Note that an example of somewhere that the price may not be permitted to fall is with the minimum wage, and some studies have found a relationship between unemployment and increases in the minimum wage (though other studies contradict these findings).

It’s not only currency manipulation, although Chinese currency manipulation has been mostly to keep Chinese currency weak against the dollar to boost exports.

China has a fairly stable government, a diversified economy, and though its private property protections aren’t good (especially for non-Chinese), the business climate has improved significantly, and their economy has come along with it. They also have the benefit of an enormous market, which means that the investment in figuring out how to navigate their laws is more likely to pay off when you can open up access to that many more buyers for your goods.

I would say yes, but my go-to definition of socialism is not the definition you are using.

Probably lecturing is a holdover from a time when printing was much more expensive. Now, there’s some argument to keep it where it can be somewhat interactive, but there’s also a move towards more effective media for education. I’m pretty sure that the most effective way to learn is actually via testing, either aural or written, with quick feedback and spaced repetition. I don’t have a cite for that.

Private ownership can’t be the defining element because a co-op is a private enterprise endeavoring to maximize profits. The defining element of capitalism comes into play when the co-op is replaced by wage-labor in order to capitalize on the worker.

If profits are increased in a co-op, then everyone gets a cut.

If profits are increased in a capitalistic workplace, no one gets a raise because wages are determined by supply of and demand for workers.

The fundamental idea of the capitalistic workplace is to consolidate wealth and the fundamental idea of the co-op is to disperse wealth.

Good point. But I’m talking in terms of large societies trending over large periods of time where it’s evident that bad luck is not to blame for the wealth disparity. No, the way to make lots of poor people and maintain their poverty for long periods of time is to have a capitalistic system that consolidates wealth into few hands. In fact, that’s the only way.

No it’s definitely zero sum. Money is not created in the stock market as there is no mechanism for it except the leverage which is undone when the trade is closed and gain/loss realized, but that leverage is actually an interest loan that siphons some of the gain making it less than zero sum: negative sum.

Now, everyone can get rich on paper, in equity, but if everyone tried to sell and realize their gains, then only the first ones out would receive any money; the last ones are called “bagholders”.

GDP is not a measure of wealth. If a tornado blows through a town, we spend existing money to repair the damage, it raises GDP, but we haven’t advanced at all.

Check out candidate Andrew Yang yang2020.com/policies/human-capitalism/

As President, I will…
Change the way we measure the economy, from GDP and the stock market to a more inclusive set of measurements that ensures humans are thriving, not barely making it by. New measurements like Median Income and Standard of Living, Health-adjusted Life Expectancy, Mental Health, Childhood Success Rates, Social and Economic Mobility, Absence of Substance Abuse, and other measurements will give us a much clearer and more powerful sense of how we are doing both individually and as a society.

Noam Chomsky argues that mothers perform the most valuable service to humanity and therefore should be the highest compensated, but we have it backward: the stock broker who does nothing is compensated most while the mothers struggle.

GDP really doesn’t mean much of anything and is mostly a red herring for people to fixate to keep them from researching more meaningful measures.

Thanks to the machines replacing the human slaves, but the global people have not realized an equal gain of the fruits that the machines freely gave, but were hoarded into few hands.

Then why did you bring it up?

Capitalism is slavery. Actually, chattel-slavery was preferable to wage-slavery because it was argued, by George Fitzhugh, that owners of slaves would take better care of them than renters of slaves.

Before you get too married to growth justifying capitalism, check out how Noam Made this guy feel (the comments are fairly brutal):

[youtube]https://www.youtube.com/watch?v=W6QAqU2KpaY[/youtube]

Yes there is: it’s called a % profit. If he’s sitting in a field picking washers, then the profit is zero and his wage is zero, but if he’s sitting in a factory, then his wage is his contribution to the collective goal of making a product and could be measured in terms of a % of the profit made from that product. Maybe he’s the most unnecessary link in the chain, but he’s still a link.

Value is just relative to whim. What if I’d prefer a car with a bike tire? Value is not anything that could be objectively measured. If someone pays $50 for a pack of McDonalds ketchup, does that mean it’s worth $50? It’s worth whatever anyone arbitrarily values it.

But he was right about nothing of value being exchanged for the house, but instead money was conjured from thin air.

It’s hard to argue against 23 min wage hikes over 80 years as being detrimental, though some still do. My retort is if MW hikes destroy jobs, then good; that’s what we want. Why do we want to create more work for people to do? But there is no evidence that jobs are destroyed.

The destruction of youth employment starting in the 80s came as college education became increasingly a requirement for employment.

But people STILL argue that “well, maybe there would have been even more jobs if not for the MW.”

Then they would have been crap jobs.

Franklin Roosevelt’s Statement on the National Industrial Recovery Act
June 16, 1933

In my Inaugural I laid down the simple proposition that nobody is going to starve in this country. It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By “business” I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and by living wages I mean more than a bare subsistence level-I mean the wages of decent living.

If a business is reliant upon low wages to exist as a profitable business, then it’s a poor business model in need of revamping.

China has sold a lot of foreign reserves in a struggle to keep the yuan strong. tradingeconomics.com/china/fore … e-reserves

tradingeconomics.com/china/currency

What definition did you have in mind?

Professors mainly just rehash what’s in the book, and yet people still can’t get it. Probably the best teacher I ever had was History in High School, which was unfortunate for me because I had zero interest in it at the time, but on the first day of class he said the state requires he issue books and instructed us to put them under our beds for the duration of the year so that we would not lose them. He said he didn’t need a book to teach us history. Man, the note-taking was frantic!

Finally got a chance to listen to this. I’d seen the Hayek/Keynes video before, and I like your rap, although I disagree with your history. My understanding is that money arose naturally out of commodity trading, i.e. precious metals were themselves a commodity that never spoil and had consistent demand, so they became a de facto currency in a barter economy; coins were uniform amounts with a seal that testifies to purity. Banking arose to solve the problem of dealing with protecting and transporting large amounts of precious metals, and also allowed for fractional reserve lending. Badda bing badda boom, fiat money.

(though admittedly that’s mostly taken from Niall Ferguson’s The Ascent of Money, not exactly a politically neutral source)

How exactly does a co-op work? Are co-ops competing with each other? Can one co-op hire another to perform some service? Is everyone that a co-op hires made a part of the co-op? If so, how can there be more than one co-op? If not, how are they different from a corporation like e.g. Uber, that on paper hires a fleet of independent contractors?

Suppose I get some partners and we’re all equal shareholders in our ‘co-op’, and we hire some people to do some work for our co-op – I’m just describing a capitalist partnership, right? If not, what’s different?

By this point in history, some parts of the world are better for human life than others. Modern developed cities have better infrastructure than rural villages in developing countries. People born in the developing world are super unlucky.

There are ways we could restructure the world to erase that luck-based wealth disparity, but there is a lot of luck-based wealth disparity, even in terms of large society trending over large periods of time.

True, but value is created. Even with a fixed money supply, different allocations of that money within the stock market will mean different outcomes in terms of value. It’s not just about who can sell for what, it’s that, under one allocation, there is no cure for the plague, and under another there is. The same money is worth more in the world where one possible use of money is to buy the cure for the plague.

I am a huge fan of Andrew Yang! I registered as a Democrat so I can vote for him in the primary. As I mentioned in the other thread, a basic income is my favored solution to a lot of the problems we’re discussing. It gives workers a real choice, and forces employers to make value propositions to their workers that are fair and rational. It also gives everyone buy-in to the economy, which makes pro-growth arguments much more compelling.

I don’t agree with all his policies, but I respect the hell out of the fact that he has so many explicit positions and attempts to make a case for them. Even on UBI, I get why he does uses $1000/month and describes a VAT as a ‘tech tax’ that sells, but ideally I’d prefer a floating basic income tied to a fixed rate VAT and land value tax. I think that’s justifiable as a social dividend in the way Yang describes it, and it automatically adjusts as society gets richer (and also prevents inflation from effectively eliminating it). That said, I’m also comfortable with a much smaller basic income. $3500/year is the median global income, it would make a meaningful difference to a lot of people in the US, and it’s an easier lift.

So use other indicators. Look at dollar a day poverty, population living in slums, or life expectancy at birth. They all show a trend that can’t be explained if the economy is zero sum. They all show significant, positive sums.

This argument depends on completely discounting the perspective of the slave. Given the option between chattel slavery and wage “slavery”, people choose to work for a living every time.

I think Chomsky’s counterargument makes the same mistake. Slave societies got richer, but the number of slaves also increased. It isn’t at all clear that they were richer once you factor in each slave as having zero wealth and enormous suffering. If you treat slaves as participants in the economy, they must represent a significant negative balance.

As for the points about the Soviet Union, Chomsky doesn’t cite sources, but Wiki says Bolsehvism was a recognized failure, which was quickly replaced with more market-based systems, i.e. state capitalism, and that despite embracing a freer market, their economy still underperformed.

So the labor of every link in the chain has the same price? The ball player and the bat boy are paid at the same hourly rate?

Yes. That seems absurd only because we are making the absurd assumption that anyone would pay $50 for a pack of ketchup, and absurd conclusions follow from absurd assumptions.

And the idea that the labor of the person who designs factories and the person who mops their floors are equal in value is similarly absurd, no one thinks that, but that seems to be a premise built into the co-op model.

No he wasn’t.
First, we know that the money given was valuable, because it was exchanged for a house.
Second, the bank can’t keep creating money indefinitely, so they must be expending a resource to create it.
Third, things “conjured from thin air” are regularly recognized as valuable. Contracts are made all the time where two parties exchange promises. Those promises have a dollar value, and damages for breach of those contracts can be recovered. And yet the promises come “from thin air”.

There is nothing conclusive, because the question is super complicated, but there is absolutely evidence that increasing the minimum wage increases unemployment. I agree that unemployment isn’t bad in itself, it’s only bad because we tie not-starving to having a job (#yanggang), but we need to be honest about what a minimum wage will do.

It is close to what I think you would call state socialism, something like state intervention in the economy to make prices what the state thinks they should be instead of what they are.

that’s understandable, 'cause i’m the illest of the Mcees.

yeah the money you speak of is called commodity money… but the money i speak of in the rap, which is called representative money, was invented as a medium of exchange to resolve the dilemma of the double coincidence of wants. in the verse ‘if a man has a horse and for rent he might trade… but if the landlord doesn’t want it then the tenant can’t pay it’, is an example of how the conflict of wants might emerge. say the landlord needs a wagon, but the wagon maker doesn’t need a horse, so the landlord can’t use the horse for trading and it’s therefore useless to him.

representative money was invented to eliminate this problem in the bartering system.

No no, Carleas is right, liquidity was never invented. It just sort of arose, as it became useful and yes largely due to precious metals which were useful for this, or elsewhere cacao beans.

the wagon horse problem is an old one, and there was never a moment where someone went “ah, it was like this but now it shall be like this.” It just… “will you take the horse?” “Nah, I can’t do anything with that horse…” “Damn… well um… How about this here pound of grain? Will that do ya?” “Wel… I guess…”

Elsewhere it was square meters of cultivated rice fields.

Identical to how companies work now with the exception of profit-sharing in place of wage-labor. And the employees hire and fire managers instead of the other way around (because employees own a larger share of the company than any single person).

Yes

Yes

Yes, although I’m sure they could sub-contract.

I don’t see how the existence of one co-op precludes the existence of others. The idea is for them to be small so the worker has some say in his own environment.

If Uber were a co-op, then drivers would be paid in a share of the profit and have a controlling interest in the company.

I’m actually not an expert in co-ops, but the way I understand it, you’d simply be taking on more partners and haggling for slices of the pie. Because I’m not a big fan of partnerships, I’m also not a giant fan of co-ops; I just bring them up for the purpose of demonstrating the exploitation of wage-slavery and refuting the anti-competition claims of those wishing to demonize industrial democracy.

What Is a Worker Cooperative?
Worker Cooperatives Are More Productive Than Normal Companies
Getting Rid of Bosses: Can a company succeed if no one is in charge?
More U.S. businesses are becoming worker co-ops: Here’s why

Someone commented if co-ops are so great, why aren’t there more of them? The answer seems obvious to me: someone wants to hog all the profits and is willing to sacrifice productivity to accomplish that.

There is plenty of luck-based wealth disparity, but venezuela is being targeted for disruption in order to capitalize on all the oil, as are other regions with oil or abundant natural resources. There is no good excuse for anyone living in poverty except the fact that the resources that would otherwise go to the poor are diverted to the rich in the name of capitalism.

“Value” is an arbitrary whimsical notion with no anchor to reality and impossible to quantify. Tesla is “valued” at $50 billion, but burns millions per day and has no tangible value other than what little assets it owns. The stock value is speculation about future outcomes and an artifact of cheap money.

Amazon went 16 years without making a single dime in profit, yet Bezos was a billionaire nonetheless. So instead of curing the plague, we could give Bezos billions in reward for a profitless company in order to invest in a space tourism. Who cares about the people? They’ll die of the plague anyway or else suicide themselves with opioids or be put in prison or perhaps they’ll shoot each other. The people be damned, what’s important is consolidating wealth into few hands because :bow-blue: capitalism.

Wow! I’m surprised, but pleasantly so. I like him, but I don’t think he has a chance though :frowning: realclearpolitics.com/epoll … -6730.html

I think Bernie is the best shot and first baby step to UBI… if we can get creepy uncle Joe Biden out of the way.

Yes I like that too: he’s an intelligent candidate who takes an engineering approach. But he strikes me as just a wee bit authoritarian, like China.

VAT is a flat tax, so the UBI would be funded by the poor, like in France the social programs are funded by recipients of the social programs. All flat taxes are counterproductive.

UBI should be a mode of regulation determined by cost of living like social security issuance, then wages will fall in line behind the amount of UBI via free market mechanism, and the funding for the UBI would be from progressive income taxes and government debt issuance. The poor shouldn’t have to pay any taxes whatsoever, so no sales tax, gas tax, VAT, or tariffs.

If you’re trying to arrange it so that the free market will regulate itself, it’s futile. The regulation of the free market can only come by way of something that is not the free market (ie a government). So the gov should determine the UBI and not the market itself or you’ll have the foxes guarding the henhouse.

If it’s too small, then it won’t work and people will say “See??? Just like public education, the post office, and other underfunded social programs… blah blah yada yada.”

How is it not zerosum? A pie is a pie.

Something like 85 people have more wealth than half the global population. Sure, there is less poverty, but the advances in alleviation of poverty has not kept up with the enrichment of the rich. So as prosperity grew, the rich claimed a larger and larger proportion of it while still allowing the nominal amount of prosperity of the poor to expand.

If the rich get 90% of the pie and the pie is worth $1000, then the poor get $100. If the pie grows to $10,000 and the rich claim 95%, then the poor get $500. It looks like the poor are doing well. Yay capitalism :happy-cheerleadersmileyguy:

Now if we can get it up to $1000000000000000000000 and 99.99999999999999%, then we’ll really be helping the poor!

The purpose of the thought experiment is to put in perspective the “rental of people” and to recognize that it was once considered (by at least someone) to be worse than outright ownership of people.

I think a lot of the “suffering of slaves” is hype. Do slave animals suffer or do they have a better life than wild animals? I see lots of fat cows eating lush grass without worry of predators. There is probably lots of propaganda out there regarding the treatment of slaves. But we still have slaves now and the robotic slaves don’t seem to be dragging the economy down much; they are an expense that pays more than they cost and the same is true with human or animal slaves or rental slaves (employees). Every added employee means more profit and a growing economy, so the same should be true with chattel slavery.

Chomsky is a source.

Here’s the transcript:

[i]In fact you could give that argument for Stalinism: there was a very substantial economic growth in Soviet Union. It was, until 1989, it was the second world, not the third world. Now it’s back in the third world because it’s undergoing capitalist reforms, something you’re not allowed to say, incidentally, but if you read, you’ll notice they’ve had ten years of capitalist reforms which have driven them right back into the third world where they came from, okay.

But if you just look at it in terms of economic growth, it was reasonably successful. That’s exactly what bothered Western leaders and if you read the documentary record right up to the 1960s, where it sort of runs dry at the moment, you find that the great concern was that the second the Soviet Union was presenting itself as a model for modernization within a single generation and that was raising all sorts of trouble, not only in a third world, but even in the rich countries. They didn’t care about Russian aggression, or you know, Stalin’s terror or anything. In fact Truman admired Stalin, you know, thought he’s an honest man, you know, could deal with him and so on, but didn’t care what happens in Russia, you know, and so on, but the same with Churchill, incidentally, who’s defending Stalin at cabinet meetings as a great man, and so on, and so forth. They could kill as many people’s they want; that’s irrelevant. The problem was then they never expected them to be attacking anybody, you know, but what they were afraid of was the economic growth which was, especially in the third world, considered quite impressive.[/i]

The Soviet Union: GDP growth

What if we consider the USSR starting with Stalin (1928). Then we find that from 1928-1970, the USSR was the fastest growing economy except for Japan! And even compared to the Third World, its performance was remarkable. The USSR was the third fastest growing economy in the world in the 1928-1970 period (Including countries for which we have 1928 data).

Chomsky’s arguments, delivered in 1997, seem accurate to me.

No I don’t think I implied that.

No the co-op model simply compensates people in terms of a percentage of the profits, so a floor-mopper would receive less % than the engineers.

In the capitalist model, the janitor doesn’t get a pay increase if the company makes more profit. Under the co-op model he would.

Under the co-op model, the tax cuts Trump gave corps would not have been used to buy back stock in order to inflate pay packages for ceos who do essentially nothing, but the extra corporate profits would have been shared with everyone in the company according to the percentage they agreed upon.

His argument was that if money can come from thin air, then it is infinitely replicatable and therefore has no value. The bank didn’t go out and earn the money through labor, but simply created it with a ledger entry. On a gold standard, the bank would have loaned him something of value, ie gold, which it could not pull from thin air and it’s that scarcity that confers value.

The only thing restraining a bank from lending is the amount of reserve they have on hand, which must be 10% of the amount lent out. But since the money they lend will invariably return as a deposit, the money supply can grow indefinitely. Not only can it grow indefinitely, but it must or the system breaks down because the amount of interest required to repay all the loans doesn’t yet exist.

Did I forget to post this last time?

The min wage was raised 10 times over 25 years and I see no loss of employment in the youth who are cited as most vulnerable to min wage increases. In fact, the number of youth employed doubled over that period! There is even less evidence on the broader market because there we have 23 min wage increases and no drop in employment over 80 years.

Anyone arguing that min wage hikes kill jobs seems to me very much like a flat-earther making a total fool of himself in the face of mountains of empirical evidence.

Peer reviewed research on the matter just seems like a more concrete way to cement one’s foolishness forever and ever, as if google newspapers didn’t already fill that role.

I’ll concede, out of kindness and openmindedness, that min wage hikes could theoretically kill jobs, but the evidence is strongly opposed to that theory.

So socialism = authoritarianism?

ALL authoritarianism is right wing.

[i]Authoritarianism: tough attitude towards violations of social rules, norms and laws;[14]
Conservatism: favoring obedient and respectful support for societal authorities;[14]
Traditionalism: favoring traditional, religious social norms and values.[14]

There are certainly extremists across the political spectrum, but most psychologists now believe that authoritarianism is a predominantly right-wing phenomenon.[22][/i] en.wikipedia.org/wiki/Right-win … itarianism

So if socialism, communism, fascism, capitalism are all on the right, then what is on the left? I put socialism on the left and everything else on the right. Dispersal of wealth on the left and accretion of wealth on the right. Democracy on the left and republics on the right. Freedom on the left and exploitation on the right.

I don’t think this explanation works. If co-op A is more productive than corporation B, i.e. can do more with the same inputs, then A should be able to out-compete B, and so the fact that B’s CEO wants to hog all the profits shouldn’t matter. The fact that co-ops don’t out-compete corporations (or rather, haven’t) says that there’s some other bottle-neck: they may be harder to form (because they require more trust), harder to scale (because once you have too many co-owners you lose efficiencies or speed), or just less suited to most industries. Statistics showing greater productivity may be subject to survivor bias (do they have a higher failure rate?), or might not take into account that workers spend more time working at co-ops (I don’t know which way that cuts, working more is bad, but working more because you like working seems like a good trade off). And the places where they’re successful often subsidize them, so I’m not sure we can get a level comparison (in the US, I would not be surprised if co-ops face tax penalties relative to equally sized corporations).

I suppose I have nothing specific against co-ops, I don’t really get the point and I don’t want them enforced on society, but if it works, great. Arguably many start-ups are effectively co-ops, since they’re run by small teams with significant equity.

I find this weird. In the building where I work, my company rents an office space, and the building provides the janitors. Should the janitors’ pay fluctuate as different co-ops move into and out of the building? Their labor doesn’t change, the replacement cost of their labor doesn’t, I don’t see why they should (or would even want to) have their compensation tied to whether or not my company is profitable.

It is a bit arbitrary, in the sense that some people like green and some like blue and there’s no reason to prefer one to the other but people just do. But the anchor to reality is that if I like blue and you like green, and I’ve got a green good and you’ve got a blue one, we can exchange them and both be happier. The fact that I will trade a green one for a blue one provides us with the empirical fact that B>G for person C at time T. Combine enough of those, and you get the quantification of value in the form of money: if I will pay $5 for the blue good and only $3 for the green, then we can quantify that difference in value at $2.

Re Amazon, the company hasn’t ‘made a profit’, but only because it’s reinvested relentlessly. It’s expanded into new areas and innovated consistently. Where Apple and Google are sitting on piles of cash they don’t seem to know what to do with, Amazon has kept changing and diversifying. Its revenue, its capital, its workforce, its reach have all grown like crazy. ‘No profit’ is a funny soundbite, but it’s misleading.

I’m not sure about his chances, but it’s early yet. And anyway, he’s very honest about it. He’s said he doesn’t care if he wins, as long as whoever does win makes UBI a part of their platform. I think getting him on the debate stage will make UBI a permanent part of the political conversation. So he doesn’t need to win to have a large positive effect on society.

For UBI, I think VAT makes sense as a funding source. If the money is collected solely to pay for the UBI, it’s net progressive: even though the poor will pay more as a percentage of their income, the VAT is effectively a tax on consumption, and since the poor are well below average on their consumption, they will end up with more money on net. And a VAT is a very efficient form of taxation, it encourages thrift and long term investment and discourages frivolous and wasteful consumption. Similar reasoning supports a carbon tax, which, despite being a higher burden as a percent of income, is again a net benefit for the poor if goes directly into a UBI, and it lets people improve their take further by changing their behavior.

But a land value tax is the real progressive move. The incidence is distributionally fair, falling in particular on people who own land and who collect economic rents rather than produce value. It’s extremely efficient, and encourages turnover where land is being misused or allowed to sit idle. It also recoups NIMBY restrictions, and taxes foreign nationals’ hiding money in US real estate. It’s pretty close to a perfect tax. And again, piped directly to UBI, most poor land owners would probably get a net benefit.

Because the net utility increases. I agree the distribution is unfair, but that doesn’t change that everyone’s quality of life has increased.

The opportunity cost is significant, which isn’t the case with animals or robots.

But this does a question similar to the one raised by Ursula LeGuin’s The Ones Who Walk Away From Omelas: what if everyone today is materially better off as a result of the vast suffering imposed by slavery? That seems like a pretty strong criticism of utilitarianism, and relates to Silouette’s question in the other thread. Personally, I reject the premise, but that’s partly an act of faith in revulsion to the alternative. But the answer isn’t trivial.

So if they aren’t infinitely replicatable, then they don’t come from thin air (modus tollens). And, as with promises, while there’s nothing stopping me from making an infinite number of promises, people will stop accepting my promises once it becomes clear that I have over-committed. Similarly, the bank is able to give money on the value of its name, but it can’t do it infinitely; it is careful not to give too much and only to give where it has the reasonable expectation of being repaid.

This isn’t a particularly scientific way of evaluating the question. For one thing, most of the minimum wage ‘increases’ your counting fall into a period where inflation effectively eliminated them; the real minimum wage peaked in 1968, and has fallen in inflation adjusted terms.

Peer reviewed studies try to tie minimum wages directly to their effects, by exploiting changes in behavior before and after the change in policy, or comparing jurisdictions where a policy applies to adjacent or comparable ones where it doesn’t.

It’s a complicated question, and just looking at a graph overlaying two lines that use different scales, without inflation adjustments, and without controls, doesn’t tell us very much.

It shades into that, yes. Socialism is colloquially basically benevolent authoritarianism. But as I mentioned above, the difference in definition between speakers is great enough that I don’t think it’s that meaningful anymore; it seems we both agree that even benevolent authoritarianism is bad.

Co-op A earns $1000, the boss gets 50% ($500) and the employees get 50% ($500).

Corp B earns $800, the boss gets 75% ($600) and the employees get 25% ($200). It’s in the interest of the boss to be less productive and maintain exploitation.

I could have been more productive by paying in piece-work instead of hourly which would give the employee control over his own income: if he wants to work fast and make lots of money, then the sky is the limit, but the reality of the matter is nobody does it that way for a reason, which is exploitation pays much better. Like I said, every employee paid me $40/hr to work. Why would I give that up? I did that for a decade and if there were a better way of doing it, I would have found it.

Yes all that may apply as well. Who knows. All I know is the reason they aren’t implemented is the fact that the boss doesn’t want to take a paycut.

If the law forced me to form a co-op, I would have quit and went to work for someone else who was running a co-op rather than deal with the headaches for less pay. I’d rather had even less pay, but zero headaches. So instead of $50/hr, I’d make maybe $20/hr and not have a care in the world.

Now you’re being silly lol. No I’m only talking about people who are members of the co-op. I was assuming the janitor was a co-op member in this example. Like if McDonalds were a co-op, then each burger flipper would get a pay raise as a result of Trump’s taxcut because everyone would be paid as a % of the profits. If profits go up, burger flippers get a raise. If profits go down, they get a cut. If management is doing a crappy job, the employees could throw him out. I think one of the main tenets of a co-op is that management works for the employees.

It’s more like if you had a house with a pond and some fancy landscaping and you call an appraiser, he will not assign any value to a pond because it’s not quantifiable and some people just don’t care about ponds. Only the house and buildings are valued according to specific rules. So it’s like that: arbitrary and whimsical value that varies greatly between people vs something quantifiable and tangible that’s more or less written in stone.

Lots of fund managers were leery of amazon because they said that one day Bezos may decide never to generate a profit and then they’d be stuck holding the bag. Bezos could decide to be a philanthropist after suckering all the investors in for the funds to build the company, then he may decide to slash prices to cost and never make a profit. He could find god. Anything could happen. It’s a crazy gamble to buy shares in a company that may never return value to shareholders. Back in the 60’s, this sort of thing would be unheard of. If a company didn’t make a profit, it would have been a penny stock and delisted from the exchange.

Just try not to throw your vote away on a guaranteed loser :wink: I’m backing Bernie come hell or high water. Then at least I won’t have to worry about friends n family with medical costs and he’s starting some sort of daycare pre-school thing too so mothers have a place to take their kids while they go to work for the new $15 min wage. It’s a good start. Oh and the drug war will finally end. And cash bail.

What? No, all flat taxes are regressive. Actually, the “progressive” taxes we have now are regressive as evidenced by the growing wealth divide, so how much more would a flat tax be regressive?

Buffett and Gates argue that taxes are already too flat:

[youtube]https://www.youtube.com/watch?v=iVOwaMWewGY[/youtube]

The poor spend 150% of their income on consumption and already have untold amounts of flat taxes financed at 30% apr. The VAT and sales tax is one of the things I’m most passionately against. They were conservative ideas to begin with:

Sales Tax Charges in the 1948 Campaign

[i]The probable need of additional federal revenue for national defense and military aid to foreign countries has led Democratic spokesmen to charge in the 1948 campaign that the Republicans will impose a general sales tax if given control of the national government in the November election. This charge appears to be based on inferences drawn from a statement, Aug. 11, 1948, by Rep. Knutson (R., Minn.), present chairman of the House Ways and Means Committee, which originates tax measures. Referring to proposals for repeal of all except a few of the federal excise taxes, Knutson said:

“Our federal internal revenue system must be based on a well balanced tax system. It should not be confined to the income tax, or to the income tax and excise taxes on liquor, tobacco, or beer alone. To do so will seriously cripple the federal revenues and throw the entire burden of supporting the activities of the federal government upon a few, chiefly those paying the income tax.”

Chairman McGrath of the Democratic National Committee asserted, Aug. 22, that the “broad excise tax base” which Knutson advocated was in reality a sales tax. In the Democratic Digest, November 1948, McGrath declared: “The powerful forces of reaction and privilege have already presented an advance invoice on the Republican party,” including “Item: Ballyhoo an income tax reduction, but, if necessary, saddle the nation with a federal sales tax to make up the inevitable deficit.”[/i]

So it’s a scheme to put the tax burden on the poor while allowing the rich to resume generating wealth disparity.

The purpose of taxation is redistribution of wealth and the VAT is a regressive redistribution distributing from the poor to the rich. The most innocent scenario is the wealth is not redistributed in either direction which fixes no problem and could be ammunition against the UBI from the conservatives appealing to out of control deficits and federal debt. Why tax the poor at all? That makes no sense. Yang is advocating this?!? If UBI isn’t implemented correctly the first time, it will be a long time before it returns because it will be yet another example of the failure of socialism.

There should be just an income tax and that’s it. Negative tax on the bottom, zero in the middle, and high on top. All the other taxes are just ways of finagling money from the poor, in the name of “fairness” or whatever emotional appeal, all too often for the purpose of socializing the costs of corporations while the gains are privatized (ie the gas tax).

Just say no to flat taxes.

A property tax is borderline. Property isn’t associated with wealth as much as it used to be and it could be the case that poor farmers are saddled with the burden. I’m ok with property taxes being collected for local uses by local governments, but probably not a good idea on a national scale.

The size of the pie doesn’t change the fact that a pie is a pie. 100% = 100% = zerosum. It’s not like we could remove a slice of the pie and still have a pie… that would be eating your cake and having it too.

That’s an irrelevant distinction. What if everyone’s quality of life hadn’t improved? Oh well? What’s at issue is the equitable distribution of the improvements and not justification for the pacification of the exploited in order to sustain the opulence of the elite and then pat ourselves on the back for having such a great system which gave a few more crumbs to the poor. Capitalism works because a guy upgraded his grass hut while someone else bought a 7th yacht?

We wouldn’t be where we are today without slavery. I have no doubts about that.

Well my point of all that was to illustrate that all money is loaned into existence and not really to get mired in the differences of money and contracts. The main takeaway is that the interest to repay those loans does not exist.

Why does it matter if inflation effectively eliminated the increase in the wage? The argument was that the MW hikes would cause loss of jobs, which didn’t happen. One could argue that maybe there would have been more jobs if not for the minimum wage, but a doubling in the number of employed youth coincidental to 10 MW increases is not good enough??? If there would have been even more jobs created in absence of MW, then they would have been crap jobs.

Inflation is an arbitrary basket of goods that changes year to year and, contrary to popular belief, the gov is working hard to overstate inflation by increasing the weighting placed on inflating goods (ie rent) and decreasing the weighting on deflating goods (ie oil). I don’t put a lot of stock into metrics that change arbitrarily at the whim of whomever, which is especially concerning when comparing one decade to another. If you want a more accurate picture, you’ll have to compute the hours of work required to purchase a specific commodity. Luckily, I’ve already done that:

hrs-worked.jpg

hrs-worked-min.jpg

Even in terms of min wage one is required to work less hours to buy a commodity as time goes on.

I’ve studied the states and found median income, education, property values to be higher in states with higher min wages while crime, poverty, and SNAP usage were lower. On average there was a 10% increase in gas prices, but wages were 30% higher in states with higher min wages.

Ah, I see what you’re saying now, I misunderstood before. Still, I’m not sure this works.

My first thought is that some bosses would choose to take the lower pay. Some people come from money, so they don’t need the extra pay. Some people are committed socialist martyrs, and get more value from running a co-op than they do from the extra pay. Those people should create co-ops, and those co-ops should out-compete non-co-op firms in the same industry.

Then I thought, maybe the co-ops can’t out-compete because 1) managers matter, and 2) because they pay more, corporations can attract better managers at the margins, so even though co-ops are more productive, corporations get the best managerial talent.

But then I realized, of course co-ops are more productive on that model. They pay workers more, so they attract the best talent, and they underpay their managers. If we hold the quality of the manager fixed, the co-op is just extracting more value from its manager, i.e. If Co-op A and Corp B have managers who provide the same value, Co-op A is getting an immediate $100 productivity boost by paying its manager less.

Another, unrelated point is, what does this picture say about the prospects for co-ops more generally? If every manager will always choose a less productive model when it’s personally enriching, what hope is there for some alternative without state intervention to enforce it? Maybe another way to ask this is, why don’t workers create co-ops and hire managers? Is there something in the structure of the current economy that makes that impossible? I think the answer to the latter question could well be yes, but I don’t know enough about e.g. business taxation to know what specifically. I’d also support removing whatever creates that imbalance, and letting the market decide (but then I’m weakly oppose business taxes generally, so this is no great concession from me).

I think a lot of workers would not like this. Take, for example, Amazon. While they get a lot of shit for their business practices, they are staple employers in a lot of places, and provided well above median pay for the local economy. Would their employees take zero pay in return for Amazon stock? I’m not so sure.

And maybe the answer is that a company like Amazon shouldn’t exist, but Amazon has a lot to recommend it over Google and Apple, which don’t pay dividends either, but also don’t do a good job of reinvesting. Amazon creates a ton of consumer surplus, it makes it possible for millions of people to access goods they didn’t even have the option to buy before, and at prices that are barely above cost. That’s good for consumers, most of whom are also workers.

Except the appraise is essentially making a prediction: you could sell your house at $X. And there are some values of X that are almost certainly wrong, and we can know that in advance. And there’s a test for the prediction: you can sell the house, open it up to bids and close a sale and find out if the appraiser was right or wrong. It’s true that people’s valuations of the house differ, but the appraiser is talking about a whole bunch of people; individually, there is great variation and X is hard to predict for a particular person, but collectively there is order and behavior is largely predictable.

I think part of it is that ‘value’ means different things. When the appraiser says “your house is worth $X”, he’s really saying that you’d be likely to get $X if you sold your house. When I say that someone could value your house at more or less than $X, I mean that they would consider themselves better/worse off if they were to trade $X for your house. Market prices then are something like a statement that,

(\exists i: V(i,g) \geq $X )

Where:
i is an individual
g is a good
V(i,g) is the value of g to i
$X is the highest price for which the statement is true.

This is too simple (it ignores transaction/search costs) but I think it clarifies my assertion that there is an objective market price.

My understanding is that this is a more general change than just Amazon. As I understand it, dividends used to be much more common, as companies shared profits with shareholders, but the tech revolution made reinvestment of profits so important as an indicator of continuing innovation that many companies prefer to sit on funds rather than to distribute them as dividends. Dividends send a signal that they can no longer innovate, which in a rapidly changing technological landscape is taken as an early sign of death.

I’ve voted for Johnson the past two elections, so no promises! I started to vote more strategically a few years ago, and I will probably do the same this cycle. In practice, your vote rarely makes a difference, so it can be more useful to spend it on a losing candidate. In 2012, I voted for Johnson from Illinois, where Obama was basically guaranteed to win, as a way to support a third party and signal dissatisfaction with the two party system. In 2016, I voted for Johnson from DC, where I expected Hillary to get 85% of the vote (she ended up getting 90%), but Johnson had a non-zero chance of reaching the threshold to get federal campaign funding (5% of the popular vote).

In the upcoming election, I’ll probably vote Yang in the primary to raise the profile of UBI, and third party in the general because DC will go strongly Democrat anyway.

I don’t dispute this. But a flat tax on consumption that pays directly into a flat per capita UBI is progressive in combination. Even though the tax would tend to take disproportionately much from the poor, the combination of the two would redistribute money from rich to poor.

Because means-testing is expensive and gameable. And the VAT is a very efficient tax, it doesn’t distort markets, it’s hard to avoid and cheap to enforce. Trying to exempt the poor loses those qualities, and isn’t necessary when the revenues are going directly into a UBI. Without tying it to a UBI or similar you are right that it is regressive.

VAT is also part of Yang’s pitch that we’re taxing automation: if employers cut jobs and replace them with machines, they benefit at the expense of employees. If the UBI gets funded with a cut of any additional profit, that makes automation not so bad.

An income tax is inherently regressive. The idle rich pay very little, and the working poor who make it out of poverty pay just as much as the upper middle classes, despite that their effective safety net is very different. And the working poor are often sharing their income with their families in poverty, while the upper middle classes are being subsidized by their families.

The best case scenario is when the rates are progressive enough to track wealth, but then why not just tax wealth? And ‘income’ is a theory laden concept, as demonstrated by the distinction in US tax law between salary and capital gains.

LVT is importantly distinct from property tax, in that it taxes the value of the land and not the value of any improvements to the land. That means that poor farmers probably won’t owe very much, because most of the value of their land is in the crops, not the land itself. (Also, the poor small farmer is effectively a unicorn at this point, most farming is done by mega corporations; even if there are some poor small farmers who will be hurt, they are very very few relative to the number of people benefited).

This is a weird use of ‘zero sum’. Percentages are scalar, they don’t mean anything by themselves. 100% of a world without a cure for the plague != 100% of a world with a cure of the plague. If we’re talking about calories, then yes, we could remove a slice of a larger pie and still have the same number of calories left as the smaller pie.

The point I’m making is that everyone’s quality of life improved because of the same economic system that produced an unfair distribution of gains. The 7th yacht isn’t the goal, it’s a bad side effect of a system that benefits almost everyone.

If you mean economically, I’m not so sure. A lot of human capital was lost in slavery. Africa was permanently set back by two hundred years and is only now beginning to claw its way into modernity. China is doing a lot of good in Africa by investing and taking advantage of their markets, and it doesn’t require slavery (it’s exploitative, but it’s still voluntary and mutually beneficial exchange of the sort that has brought so much of Asia out of similarly desparate poverty). I’m not sure what a non-slavery trading relationship with Africa would have looked like, but I think there are good arguments that it would have produced more net social welfare than slavery did.

But if inflation effectively eliminated the increase in the minimum wage, then it wouldn’t be expected to cause job losses. The graph of hours worked per item based on median income shows that the standard of living has been increasing. The graph of hours worked per item based on minimum wage seems to show that the minimum wage has been roughly flat for at least the past 50 years. No change in minimum wage relative to goods means no change to increase the unemployment effects of the minimum wage.

But are those connections causal? Income, education, and property values could be reasonably expected to lead to the kind of politics that favors raising the minimum wage.

Also, aggregate measures hide differences within the population. Net employment could remain steady, and the effect would still be bad if low skilled workers lose jobs relative to better-off workers, e.g. if poor adults lose jobs in favor of wealthy highschool students.

I think the empirical case either way has been mostly inconclusive: there have been good studies that found an effect and good studies that haven’t. But I think the fight is not that important, any effect in either direction is small (including any possible net benefit), and the number of people affected is small. For me, the intuitive case wins it, and I’d prefer a UBI to a minimum wage if only for its elegance.