Warren Buffet nails it on inequality

[RavenSky]

I never said that the architect, contractor and brick-layer weren't necessary for my house to be built. And I have already said that you won't have much argument from me if you want to discuss income inequality or the merits of worker cooperatives.

But I will continue to refute your declaration that I am not also a necessary component to that house being built. If I am not available to commission, finance and/or buy the house, it won't be built. Period.

You confuse what is necessary to build something with what is necessary to buy it.

Yes, to keep the whole thing going again you must buy it.

But to build it, you are not needed. They can do it without you.

And you confuse the point of my original hypothetical. If I want a custom house built, no "they" really cannot do it without me. To build it, I am the most important component because I am the one providing the money to build it.

Moreover, you confuse the point of my developer example as well. Without at least one person/company involved in the development having the ability to secure financing for the project, the project will not get built. Even if the person with the ability to secure/provide the financing to get the project built does absolutely nothing else, they are still a necessary component to the development - not "deadwood"

You have failed to actually demonstrate this "deadwood" you keep insisting exists.

 

[coloradoatheist]

You confuse what is necessary to build something with what is necessary to buy it.

Yes, to keep the whole thing going again you must buy it.

But to build it, you are not needed. They can do it without you.

And you confuse the point of my original hypothetical. If I want a custom house built, no "they" really cannot do it without me. To build it, I am the most important component because I am the one providing the money to build it.

Moreover, you confuse the point of my developer example as well. Without at least one person/company involved in the development having the ability to secure financing for the project, the project will not get built. Even if the person with the ability to secure/provide the financing to get the project built does absolutely nothing else, they are still a necessary component to the development - not "deadwood"

You have failed to actually demonstrate this "deadwood" you keep insisting exists.

That's because in that sytem, community advisors decide that you get the choice between a 500 square foot apartment and a 500 square foot apartment

 

[SimpleDon]

Of course, Warren Buffet wants the government to subsidize wages. Higher wages means lower profits. The government subsidizing lower wages, resulting in more lower wage jobs and in higher profits. At the cost of whoever is taxed to provide the government aid. Is he proposing to tax corporate taxes to pay for the increased government aid.

I'm not so sure about this. I'd have to look at the financials of the main companies that Berkshire Hathaway is invested in. I'd want to know what fraction of their expenses are labor and how much would they benefit from subsidized wages. It might be #17 on their secret plan to unjustly enrich themselves. Buffett has advocate things that would not be in his best interest before like raising the capital gains tax. Can you think of a way this would benefit him and his investors? He is also at the age where people start wanting to give back and leave a good legacy. I'm willing to take him for his word until proven wrong.

Don't get me wrong. Buffett is among the very best of his breed. He makes his money by buying businesses that everyone else is certain are nearing obsolescence; railroads, consumer financial services, food, etc. He encourages investment in the real business, not just indirectly by owning stock, he wants money put into buying physical assets, new equipment, new facilities, etc. But he is who Loren gave us to discuss.

He doesn't favor the EITC over increases in the wages of the poor because he has calculated that it will mean more profits for himself. He believes that it is the best way to proceed to improve the lot of the poor because he doesn't understand the economics involved, including the role of the investors like himself.

He would probably agree with Loren and most of the free market enthusiasts here. That the labor market is a fair market where wages are set to the marginal productivity of the labor. That to increase the wages by an artificial means like increasing the minimum wage will distort the labor market, resulting in unemployment.

He is approaching the problem with a faulty set of economic tools. It is worth pointing out for example, that his toolset doesn't have an equivalent concern for profits exceeding the marginal productivity of capital, causing economic distortions in the capital markets. It is reasonable to assume that if marginal productivity plays such a key role in one market it must play an important part in the other.

It actually doesn't play a part in either, the labor market is exactly what it appears to be, one that is not a fair market unless the economy is at full employment and full utilization. Even then the employer has considerable leverage in dealing with his employees.

Disclosure, I own Berkshire stock and have the highest regard for Buffett's abilities as a value investor. I have less regard for his abilities as an economist.

 

[SimpleDon]

EITC is not a "wage subsidy." It is an additional cash payment to low income households. The program is the single most effective program in lifting households with children out of poverty. If you are against stregthening it or even support removing it all together, your wrongheaded ideas are contributing to childhood poverty and suffering.

http://www.nber.org/digest/aug06/w11729.html

This paper argues that the EITC is a better form of government assistance. It doesn't argue that it isn't a subsidy for low wages.

Of course, the EITC makes it possible for employers to pay wages below a level that they couldn't pay if the EITC didn't supplement them. It is the same for SNAP and even to a limited degree for ObamaCare. You can't tell me that these programs aren't currently being demonized. And you certainly can't tell me that the EITC won't be demonized in the future in the continued rush to increase the income of the wealthy, as Social Security and Medicare, arguably the nation's primary poverty reducing programs, have been recently.

All that I am saying is that we should use capitalism to eliminate poverty, not "fill in" government programs that can be turned off by a reactionary political wave or a reactionary Supreme Court supermajority of five jumping on a four word misstatement in a bill.

It is more than a little ironic that those who present themselves as the strongest defenders of capitalism seem to feel that it is such a fragile system that in the world's biggest, richest capitalistic economy that it can't accomplish the elimination of poverty, a task that many capitalistic economies with far fewer resources and advantages have accomplished.

 

[SimpleDon]

massive snip ... I will cover later​

There is no economic theory that holds up to say that higher wages result in more unemployment. The people who argue that a higher minimum wage results in higher unemployment depend on marginal productivity to provide theoretical support for the assertion. But MP tells us that any increase in wages should result in higher unemployment. It is one reason among many that marginal productivity is considered to be bogus. Besides, the people who developed the theory said that it is only valid at general equilibrium, full employment.

You mean the law of supply and demand does not "hold up"? Before you alert the press you might cease (errantly) focusing on denouncing marginal productivity (which illuminates the individual firms evaluation of an extra employee's marginal worth) ...

I was talking about marginal productivity theory that says that supply and demand forces the price of a good or service down to the marginal cost of the last unit produced. It is considerably more than what you asserted, that it 'illuminates the individual firms evaluation of an extra employee's marginal worth.'

Am I to assume that you agree with me that this theory is bogus and doesn't hold up?

It is the theory that makes a self-regulating free market possible. Among its flaws is that in a modern industrial economy it doesn't allow for any profits.

If you don't accept marginal productivity theory as a reason for a higher wage to create unemployment then you are left with ...

.... and deal with the basic 'law' that does not hold up:

The law of s/d is based on a very simple proposition - if the price of something rises a buyer buys less of it. Minimum wages in a competitive labor market has an upward-sloping labor supply curve (S) and a downward-sloping labor demand curve (D). With no minimum wage, there is the equilibrium wage and labor employed (w and L). A minimum wage (mw) that is higher than w, will cause fewer workers to be employed. First, employers will substitute away from the more expensive labor to other inputs (such as capital) and second, because costs are higher with this new input mix, product prices rise, which further reduces labor demand in the affected group.

These two effects lead to lower employment (Lmw).Of course, there are other effects beyond this simplified model, but the effects start here. Employers also move towards substituting away from less-skilled workers toward more-skilled workers after a minimum wage increase, discourage future job growth in the affected sectors, and reduce worker income growth and mobility. Ifhe minimum wage is intended to help the least-skilled workers, the policy is self-defeating.

another massive snip ... I will cover later​

I yes, I forgot the supply and demand fallacy. That if something costs more people will buy less of it applied to the labor market.

It is a fallacy because if you lay off people because the minimum wage goes up you not only lose the part of the profits that go to the higher wage for the workers who remain you also would all of the profits and the overhead coverage for the loss in production and sales from the marginal product that the laid off workers provided. Your supply and demand argument fails because employers only hire when doing so increases their production and their profits. Laying off workers reduces both.

Simply put, if you lay off workers because of an increase in the minimum wage you will lose more money than if you retained the workers and accepted the increase in the wages and the decrease in your profits.

I can explain the fallacies behind the other arguments that you presented but let's concentrate on this one for now since I had forgotten this well worn canard.

 

[untermensche]

You confuse what is necessary to build something with what is necessary to buy it.

Yes, to keep the whole thing going again you must buy it.

But to build it, you are not needed. They can do it without you.

And you confuse the point of my original hypothetical. If I want a custom house built, no "they" really cannot do it without me. To build it, I am the most important component because I am the one providing the money to build it.

Moreover, you confuse the point of my developer example as well. Without at least one person/company involved in the development having the ability to secure financing for the project, the project will not get built. Even if the person with the ability to secure/provide the financing to get the project built does absolutely nothing else, they are still a necessary component to the development - not "deadwood"

You have failed to actually demonstrate this "deadwood" you keep insisting exists.

Of course they can build a custom house without you.

They can also build a custom house to your desires.

But they don't need you to build it.

You can stay home.

 

[SimpleDon]

Once again, raising the minimum wage doesn't result in higher unemployment. No one has shown this in empirical studies.(emphasis added) Auxlus made a big deal about a study that tried to say that a higher minimum wage results in slower employment growth for the first year after the wage goes up. This is considerably different (emphasis added) than your claim that it results in higher unemployment.

Different to whom? Last time I checked, unemployment due to a lack of new jobs feels a heck of a lot like unemployment caused by being laid off, for whatever reason. Moreover, raising the minimum wage DOES cause disemployment (unemployment) in specific parts of the workforce (among other deleterious effects), and that has been shown repeatedly.

I thought that an increase in the minimum wage is suppose to result in the unemployment of the some of the minimum wage workers that receive the increase? That it somehow reduces the future growth of jobs is something that we can live with and find other solutions for. It seems to be a very thin gruel for not increasing wages for the poor, especially when it is accompanied so often by assertions that no other wage increases result in such dire consequences.

And among the "no ones" you ignore that show in their empirical studies the negative effects on employment from increased minimum wage:

Baker, Benjamin, Stranger 1999

Neumark, Schweitzer, and Wascher 2004

Neumark and Washer 2002a

Cross Country Evidence Neumark and Washer 2004

Neumark 2001

Singell and Terborg 2007

Currie and Fallick 1996

Powers, Bauman, Persky 2007

Zavodny 2000

Couch and Wittenburg 2001

Wellington 1991

Williams and Mills 2001

Razen and Marimoutou

Keil, Robertson, and Symons 2001

Neumark and Wascher 1994

Keil, Robertson, Symons 2001

Deere, Muphy, and Welch 1995

Burkhauser, Counch, and Wittenburg 2000a

Sabia 2006a

(and others)...

An impressive list. But all of the studies that I have seen, pro- and con- all agree one one point, that whatever the effects of a minimum wage increase have on employment it is a barely noticeable one, so much so that it is impossible to measure its impact on the economy as a whole, that the only chance to see any impact at all is to look exclusively at teenage employment.

Oh, except of course, that an increase in the minimum wage makes a large difference in the lives of the minimum wage workers.

So yes, there are a lot of studies saying that a minimum wage increase might have a tiny impact on the employment of teenagers, either for the good or for the bad, but they all agree that there is no noticeable impact on the overall economy except for the benefits to the workers whose incomes are increased. Once again, I can live with that. Noted for future reference.

If it were true that an increase in the minimum wage results in higher unemployment among minimum wage workers then the converse would have to be true, lowering the minimum wage would have to result in more minimum wage workers. We have a thirty year experiment in effectively lowering the minimum wages. In current dollars the minimum wage is $3.50 lower than it was at it highest, when LB Johnson was president. How many more minimum wage workers do we now than in 1965? Your Nobel prize awaits, but be prepared for a disappointment.

That is one of the more poorly constructed 'ad hoc' rationalizations on minimum wage. IF minimum wage is lowered then by definition a smaller percentage of the workforce is defined as working at minimum wage, which makes fewer minimum wage workers. OF COURSE the number of workers covered by minimum wage drops. I suspect you are trying to say something different - but till then be aware that the percentage of the workforce covered has dropped accordingly: (an older capture I made)

There is no economic theory that holds up to say that higher wages result in more unemployment. The people who argue that a higher minimum wage results in higher unemployment depend on marginal productivity to provide theoretical support for the assertion. But MP tells us that any increase in wages should result in higher unemployment. It is one reason among many that marginal productivity is considered to be bogus. Besides, the people who developed the theory said that it is only valid at general equilibrium, full employment.

You mean the law of supply and demand does not "hold up"? Before you alert the press you might cease (errantly) focusing on denouncing marginal productivity (which illuminates the individual firms evaluation of an extra employee's marginal worth) and deal with the basic 'law' that does not hold up:

The law of s/d is based on a very simple proposition - if the price of something rises a buyer buys less of it. Minimum wages in a competitive labor market has an upward-sloping labor supply curve (S) and a downward-sloping labor demand curve (D). With no minimum wage, there is the equilibrium wage and labor employed (w and L). A minimum wage (mw) that is higher than w, will cause fewer workers to be employed. First, employers will substitute away from the more expensive labor to other inputs (such as capital) and second, because costs are higher with this new input mix, product prices rise, which further reduces labor demand in the affected group.

These two effects lead to lower employment (Lmw).Of course, there are other effects beyond this simplified model, but the effects start here. Employers also move towards substituting away from less-skilled workers toward more-skilled workers after a minimum wage increase, discourage future job growth in the affected sectors, and reduce worker income growth and mobility. Ifhe minimum wage is intended to help the least-skilled workers, the policy is self-defeating.

So what you are saying is that supply and demand in the labor market is only a one way street, that if the cost of something, labor in this case, goes up that people, employers, will buy less of it is absolutely true. But that the opposite doesn't hold, that if something costs less that people wouldn't buy more of it?

That increasing someone's wages limits wage growth. That increasing lower paid workers incomes means that more higher paid workers are hired. That there are other unknown effects that just have to hurt those poor people, there just have to be.

In what universe aren't these rationalizations tailored to this discussion and this discussion alone?

All that we are talking about doing is increasing the wages of minimum wage workers and those near minimum wage workers by 19 billion dollars a year for a minimum wage increase to $10.50 an hour. The CBO says that this will result in profits being reduced by about 17 billion dollars a year. Corporate profits, not including profits from small businesses, are running about 1.7 to 1.9 trillion dollars a year. The decrease in profits won't even threaten the rounding error.

Perhaps this is the most illuminating comment on this subject you have made. Apparently you think the issue is NOT helping a specific subset of the labor market (the young, unskilled, teens, etc.) or concern over a specific subset of businesses that employ min wage employees, BUT that of all those big profit "corporations".

I guess it helps to pretend that Exxon, McDonalds, and Lena's Soul Food Cafe and their employees are jointly impacted in those "trillion plus" in corporate profits - I mean, why clutter the discussion with that subset of employees, businesses, and consumers actually impacted with new costs and actual effects?

These aren't my numbers. They come from the Congressional Budget Office, made when the CBO still made independent assessments of the economic impact of proposed legislation, before conservatives in Congress instructed them on what conclusions that the CBO has to come to.

Of course, what is important is the impact that the increase in the minimum wage would have on the minimum wage workers and those earning close to the minimum wage. All that the CBO is saying is that the impact will be reduced profits. I simply quoted what corporate profits are to give some context to the size of the possible impact on those profits. None.

If we have learned anything from the supply side economics of the last thirty five years it is that the income distribution in the country is capable of being modified by national economic policies.

We have, just have we should have learned that certain kinds of economic policies are more concerned with punitive harm to some, more than they are of helping those they claim they wish to help.

What punitive harm does it do? It doesn't impact employment enough to notice. It reduces profits by 17 billion dollar in a 17 trillion dollar economy.

It will help the people that need the help without causing the slightest suggestion of a ripple in the economy.

I want to go much further, to use what we have learned over the last thirty five years about the robustness of the real economy that we have today, not some fantasy of free market fetishes about marginal productivity and one way supply and demand in the minimum wage labor market and nowhere else, to completely eliminate poverty. To eliminate this scourge, this waste of human potential that causes so many of the problems that we have today.

 

[arkirk]

And you confuse the point of my original hypothetical. If I want a custom house built, no "they" really cannot do it without me. To build it, I am the most important component because I am the one providing the money to build it.

Moreover, you confuse the point of my developer example as well. Without at least one person/company involved in the development having the ability to secure financing for the project, the project will not get built. Even if the person with the ability to secure/provide the financing to get the project built does absolutely nothing else, they are still a necessary component to the development - not "deadwood"

You have failed to actually demonstrate this "deadwood" you keep insisting exists.

That's because in that sytem, community advisors decide that you get the choice between a 500 square foot apartment and a 500 square foot apartment

I have never seen "money" build anything. I have never seen "financing" build anything. Money is a societal chit one uses to procure THINGS, hence claim ownership. It is issued by people who intend for it to eventually represent the results of labor and not labor itself. The money manipulators in our society could be replaced most easily because they have no particular skill except holding their faces straight when they claim to own the human environment.

He is smart enough to buy himself expensive suits with the funny money.

 

[SimpleDon]

The basic nature of humans is they adapt to their environment.

The basic nature of humans is when they live under decent conditions they tend to be decent, and when they live under repressive conditions, like capitalism or slavery, they become hardened and less decent.



It is delusional to think that the only thing better than immoral capitalism is utopia.

The problem is you are describing a utopia.

We don't need a utopia. Nor do we need a self-regulating, self-organizing free market fantasy.

We have a good, robust economic system right now, one that has evolved over hundreds of years adapting to the changing conditions, taking into account the choices that economic agents have freely made. We need to try to better understand the economy that we have right now, rather than to waste the time dreaming about how to change it.

Stripped down to its basic essence, any economy, no matter what system it uses, has three functions. It must marshal the often scarce resources to produce the products that society needs to sustain itself, to feed, shelter, clothe, keep healthy, etc. the members of the society. It must distribute those things to the members of the society. And it must maintain the economic system itself, to perpetuate the system and to hopefully to continually improve the system so that it works better in the future.

Any economic system has to be judged on how well it does these three things. No system does all three well. Socialism is good at producing the basic needs and at distributing them. Its ability to maintain itself and especially to improve itself over time are where socialism stubbles.

Capitalism does well on production and the maintenance and improvement of itself. It is what we are talking about here, distribution to the members of society, where capitalism falters. Some inequality in the distribution of rewards is required for capitalism to work. The question should be exactly how much inequality in the distribution is required?

This is to both of you.

 

[coloradoatheist]

The problem is you are describing a utopia.

We don't need a utopia. Nor do we need a self-regulating, self-organizing free market fantasy.

We have a good, robust economic system right now, one that has evolved over hundreds of years adapting to the changing conditions, taking into account the choices that economic agents have freely made. We need to try to better understand the economy that we have right now, rather than to waste the time dreaming about how to change it.

Stripped down to its basic essence, any economy, no matter what system it uses, has three functions. It must marshal the often scarce resources to produce the products that society needs to sustain itself, to feed, shelter, clothe, keep healthy, etc. the members of the society. It must distribute those things to the members of the society. And it must maintain the economic system itself, to perpetuate the system and to hopefully to continually improve the system so that it works better in the future.

Any economic system has to be judged on how well it does these three things. No system does all three well. Socialism is good at producing the basic needs and at distributing them. Its ability to maintain itself and especially to improve itself over time are where socialism stubbles.

Capitalism does well on production and the maintenance and improvement of itself. It is what we are talking about here, distribution to the members of society, where capitalism falters. Some inequality in the distribution of rewards is required for capitalism to work. The question should be exactly how much inequality in the distribution is required?

This is to both of you.

And because capitalism has become so successful we've asked it to do more than any time in the past. We're to a point where we are trying to make it so half our life is spent not working instead of starting work at 13 and working until your parents took care of you or you died. Doctors weren't even a respected profession until about 100 years ago, where before then they were considered on bar with butchers or barbers. And for food, which societies made sure that everyone was fed, and for education the same.

 

[Bomb#20]

And using the Spanish model to predict anything would be like watching the weather for 10 mins and predicting the weather the next day. It didn't last. And there were no measurements to take from that system.

Au contraire. The Spanish model lasted quite long enough to make the one critical measurement that needed to be made. When factories were managed by committees elected by the workers, with Spanish "Anarchists" standing around holding guns during the vote, was the voting by secret ballot? It was not. What a surprise.

 

[SimpleDon]

Once again, raising the minimum wage doesn't result in higher unemployment. No one has shown this in empirical studies. Auxlus made a big deal about a study that tried to say that a higher minimum wage results in slower employment growth for the first year after the wage goes up. This is considerably different than your claim that it results in higher unemployment.

If it were true that an increase in the minimum wage results in higher unemployment among minimum wage workers then the converse would have to be true, lowering the minimum wage would have to result in more minimum wage workers. We have a thirty year experiment in effectively lowering the minimum wages. In current dollars the minimum wage is $3.50 lower than it was at it highest, when LB Johnson was president. How many more minimum wage workers do we now than in 1965? Your Nobel prize awaits, but be prepared for a disappointment.

I don't think that logically follows. If you raise minimum wage, you'd expect the number of people making minimum wage to increase simply because the bar is raised: folks who were making just above the minimum would statistically become minimum-wage earners whenever the minimum is raised, even if overall unemployment increases. The number of minimum wage workers would decrease only if the number of employees in the bracket between the old and new minimum wage is less than the number of people becoming unemployed due to the minimum wage increase.

I wasn't submitting this as being logical. I was asking the question that if you say that increasing the minimum wage results in disemployment, to use the economics term for the combination of today's unemployment and tomorrow's reduced job growth, shouldn't decreasing the minimum wage, which we have effectively been doing for a long time now, result in more minimum wage workers, not fewer as has happened?

A hint, I don't believe that either is the case.

Someone else submitted the argument that supply and demand guarantees job losses, disemployment, because if you raise the price of something people will buy less of it. This point that I was trying to make is the same as asking if people buy less labor because the price goes up shouldn't the converse be true that people will hire more minimum wage workers if the price goes down?

It is admittedly a belabored point. But I struggle with people's understanding of these things. The world is made up of forces and counter forces. To believe and accept the force while denying the counter force is such an obvious contradiction that I struggle to see how anyone can accommodate it.

It is the engineer in me I suppose.

Raising the minimum wage will also raise the wages of close to the minimum wage workers. There was a reason that the near minimum wage workers didn't earn the minimum wage before the increase, there is nothing to change this afterwards.

 

[untermensche]

And using the Spanish model to predict anything would be like watching the weather for 10 mins and predicting the weather the next day. It didn't last. And there were no measurements to take from that system.

Au contraire. The Spanish model lasted quite long enough to make the one critical measurement that needed to be made. When factories were managed by committees elected by the workers, with Spanish "Anarchists" standing around holding guns during the vote, was the voting by secret ballot? It was not. What a surprise.

They had cameras. Show me the pictures of this.

 

[arkirk]

We don't need a utopia. Nor do we need a self-regulating, self-organizing free market fantasy.

We have a good, robust economic system right now, one that has evolved over hundreds of years adapting to the changing conditions, taking into account the choices that economic agents have freely made. We need to try to better understand the economy that we have right now, rather than to waste the time dreaming about how to change it.

Stripped down to its basic essence, any economy, no matter what system it uses, has three functions. It must marshal the often scarce resources to produce the products that society needs to sustain itself, to feed, shelter, clothe, keep healthy, etc. the members of the society. It must distribute those things to the members of the society. And it must maintain the economic system itself, to perpetuate the system and to hopefully to continually improve the system so that it works better in the future.

Any economic system has to be judged on how well it does these three things. No system does all three well. Socialism is good at producing the basic needs and at distributing them. Its ability to maintain itself and especially to improve itself over time are where socialism stubbles.

Capitalism does well on production and the maintenance and improvement of itself. It is what we are talking about here, distribution to the members of society, where capitalism falters. Some inequality in the distribution of rewards is required for capitalism to work. The question should be exactly how much inequality in the distribution is required?

This is to both of you.

And because capitalism has become so successful we've asked it to do more than any time in the past. We're to a point where we are trying to make it so half our life is spent not working instead of starting work at 13 and working until your parents took care of you or you died. Doctors weren't even a respected profession until about 100 years ago, where before then they were considered on bar with butchers or barbers. And for food, which societies made sure that everyone was fed, and for education the same.

You talk like capitalism is something that is real, a bonafide system with real answers to our problems and not the den of greedy bloodsucking leaches it has become. As for your reverence for the medical profession, the reason it was not respected was that it was on a par with butchers and barbers 100 years ago. Today a good many Doctors are still on a par with Bar Tenders.

What most people are calling "capitalism" is industrialization. I frankly do not believe capitalism is a system. That is part of the reason it cannot adequately cope with environmental problems. I defy anybody to show me how capitalism "works for the good of us all"? I also defy anybody to show me a flow chart showing how it works without roughly reproducing a flow chart similar to those of recent monarchies. The purpose of capitalism is a legitimate purpose only to those on top. To everyone else, it is represented as a benign milieu where we are free to choose between Ford and Chevy. Our environment is close to requiring life support and our industrialists want more fossil fuel and more strip mines. This comes because we have industrialist mentalities owning the earth and their business is to process the earth for profit.

Social organization has to be a part of a survivable society. Where we are now is a kind of no-man's-land of burgeoning industrial assaults on our environment and faith based buzzwords driving us forward into the abyss. Most of the writers on this forum regard "socialism" as a thing that always has the same character, stumbling, ignorant, unable to innovate. Socialism is not one single system organized from stem to stern. Socialism itself is an innovation. There are no cosmic mandates that dictate it cannot work. Socializing various society wide functions will always move forward and be ever changing. In this regard it is like capitalism...ever changing...yet with a direction that is different.

It makes a difference what portion of society's welfare you consider. Socialists generally have a wider range of considerations when considering projects and laws and government functions. Because their innovation does not feed the capitalist, the capitalist cannot recognize the innovation. And interesting example is 3rd world countries produce drugs for themselves in violation of drug patents in the U.S. or their people would go untreated due to extreme costs. This is just one difference among many. Not every 3rd world country does this. Some march lock-step behind Axulus and Colorado Atheist and Loren and just allow those stricken with disease to die. Good ole Capitalism at work improving things for all the (white) humans.

Capitalism, while it is not a system, it can be used to systematically exploit other people. It is precisely a matter of demanding respect for ideas and actions that are deplorable on a human or environmental basis. It serves capitalists, not everybody.

 

[Bomb#20]

The system didn't have to do anything in that time so there is no way to make a comparison. It was initially united but you can't make any predictions from that little time.

Sure it did and sure you can. It had to produce enough revenue to keep the CNT-FAI in operation. So they ordered factories to send a percentage of their profits to the central organization. So in factory after factory the workers voted to raise their wages to the point where their factory no longer showed a profit. So the CNT-FAI started setting wages from the top. Given a taste of power, "Anarchists" predictably evolve into communists in all but name; this progression was already observably underway when the experiment was crushed.

 

[ksen]

I defy anybody to show me how capitalism "works for the good of us all"?

They won't because no one's claimed that.

What capitalism is is a system that rewards righteousness with gobs of cash and privilege and punishes unrighteousness with destitution and misery.

Or at least that's what some seem to want us to think.

 

[arkirk]

Are they necessary?

Yes.

To go back to my hypothetical, I (as the person commissioning the home to be built) am the MOST important component. Without me sitting on my ass eating Bon-bons while waving my fingers at the architects and contractors and brick-layers (as you seem to envision the "deadwood" doing), the house would never be built and none of those people would make any money from the building of it. It was my ability to get the loan and my desire to have a house built that made it all possible even if I never once picked up a hammer.

Without you they would build something else. You are relying on the scarcity of capital to make yourself important. Do you really think other people live to listen to you daydream and watch you eat bon bons? The person who gave you the loan made it all possible. Did he contribute anything but a paper assertion that you must be listened to while eating your bon bons? You guys are playing a Kabuki game.

 

[Loren Pechtel]

I invented fire. What else do you want from me?

Hey! I've got Patent Pending on that! You will be hearing from my lawyers (When they get back from serving that writ on Prometheus).

Get some better lawyers. The clock on patents starts upon application in at least most of the world. Fire has been around a very long time, your lawyers committed the ultimate legal sin: losing track of the clock.

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I said somebody LIKE Donald Trump. A rich developer that builds nothing but the banks lend him money as if he can. Any money he takes is money wasted since he adds no labor to the building.

He and his ilk are the deadwood that could be easily eliminated.

Unless you somehow think builders couldn't build just as well without some airbag that adds no labor.

As always you don't recognize the value of direction. How far will your car get without you in the driver's seat?

 

[Loren Pechtel]

You seem to be under the mistaken belief that the only form of labor is manual labor.

It's the usual problem that almost any field they know nothing about appears pretty easy. There's also the related problem that people are basically incapable of evaluating their own skill in a field. Both of these stem from the same basic cause: To a large degree we measure our skill by looking at what we don't know--but someone who knows little of a field doesn't know most of what they don't know. They see only a little that they don't know and rate their knowledge well above reality.

 

[untermensche]

As always you don't recognize the value of direction. How far will your car get without you in the driver's seat?

As always you look at people trapped in a system of limited capital flow as needing direction.

Direction is not what they are lacking.