The Problem With Capitalism Is That You Eventually Run Out Of Other People's Money...

Or was there some other reason for the credit-crunch that I've missed? 

Original Post by lysistrata:

Most capitalists believe and support private charity.  Check out Carnegie-Mellon, or the Bill & Melinda Gates Foundation.  Believe it or not, a lot of extremely wealthy people recognize that there is a limit to what spending money on yourself accomplishes for you.  Extremely wealthy people are not inherently evil; they generally also want the world to be a better place for their children.  They just want to decide for themselves how they want their wealth spent rather than having the government decide for them.

A rising tide lifts all ships.  The poorest people in America are still much, much wealthier than the average folks in many developing nations.  "Poor" is a very relative term.

I already mentioned the private charity thing. Private charity, however, does not have as its mandate to ensure that the basic needs of all citizens are met, and it is not accountable to those it serves, but rather those who fund it. Government, in a democracy, is accountable to "the masses" (whether the US is even a democracy anymore, however, is a reasonable question).

I think we've been hearing the "rising tide lifts all ships" for decades now - it used to be called trickle-down economics (see the illustrated description here, or in a more multilayered society, here.) It simply isn't true. Since the late '70s the wealthy have gotten much wealthier without the average household increasing its wages or wealth significantly. And as for comparing the poor in wealthy countries to the poor in developing countries, you are right about your claim - but that isn't the comparison that is relevant when discussing socialism. Since socialism takes place within national boundaries, you should be comparing the wealth of the US poor with the wealth of the US rich. And that comparison is rather staggering - especially when you realize that the 400 richest families are not even included in the Fed Surveys of wealth and income, and that the wealthier families are less likely to report their wealth and income to surveys.

Original Post by ignayshus:

Bologna.

The masses have power, in so far as they have the capacity (and desire) to riot out of control.

Their power is influence. Their method is fear.

Beyond that they have nothing, so without fear of meaningful reprisal or likelihood of being caught, the worlds leaders act in their own self-interest first.

Uh, do no politicians pander to the poor and working classes where you live? Because they do here - those people actually vote, here.

*wanders in*

As a capitalist pig, I felt I should make an appearance here.

That is all.

Original Post by lysistrata:

A rising tide lifts all ships. 

Only if you assume that none of the ships are are leaky, overcrowded rowboats.

On edit:  Has the Right Been Misusing JFK's quote?

Original Post by trustwomen:

Original Post by lysistrata:

Most capitalists believe and support private charity.  Check out Carnegie-Mellon, or the Bill & Melinda Gates Foundation.  Believe it or not, a lot of extremely wealthy people recognize that there is a limit to what spending money on yourself accomplishes for you.  Extremely wealthy people are not inherently evil; they generally also want the world to be a better place for their children.  They just want to decide for themselves how they want their wealth spent rather than having the government decide for them.

A rising tide lifts all ships.  The poorest people in America are still much, much wealthier than the average folks in many developing nations.  "Poor" is a very relative term.

I already mentioned the private charity thing. Private charity, however, does not have as its mandate to ensure that the basic needs of all citizens are met, and it is not accountable to those it serves, but rather those who fund it. Government, in a democracy, is accountable to "the masses" (whether the US is even a democracy anymore, however, is a reasonable question).

I think we've been hearing the "rising tide lifts all ships" for decades now - it used to be called trickle-down economics (see the illustrated description here, or in a more multilayered society, here.) It simply isn't true. Since the late '70s the wealthy have gotten much wealthier without the average household increasing its wages or wealth significantly. And as for comparing the poor in wealthy countries to the poor in developing countries, you are right about your claim - but that isn't the comparison that is relevant when discussing socialism. Since socialism takes place within national boundaries, you should be comparing the wealth of the US poor with the wealth of the US rich. And that comparison is rather staggering - especially when you realize that the 400 richest families are not even included in the Fed Surveys of wealth and income, and that the wealthier families are less likely to report their wealth and income to surveys.

A private charity has as its mandate whatever its governing instruments say that its mandate is.  They have no more obligation to "ensure that the basic needs of all citizens are met" than you, personally, have such an obligation.

The citizens of the US are wealthier because of the most productive members of society.  People who are wealthy invest capital to provide goods and services.  More goods and services raise the GDP.  More goods and services also creates competitive pressure to lower prices, making more goods and services available at a lower price.  Which is why "poor" in the US requires some disclaimers ... "poor," but with a cell phone and cable TV.

By the way, we're talking about classical economics, not trickle-down economics.  Trickle-down economics is a misnomer for certain tax policies.

Your suggestion that we can only consider wealth distribution in the political context of a single nation cuts against your argument that wealth distribution is a moral issue.  Unless you're being a moral relativist.

Original Post by santonacci:

Original Post by lysistrata:

A rising tide lifts all ships. 

Only if you assume that none of the ships are are leaky, overcrowded rowboats.

There is always creative destruction in capitalism.  It's a natural result of innovation and improvement, both of which are good things that make us all wealthier.

On edit - See above re classical economics vs. supply-side (aka trickle-down) economics.  Supply-side economics is just Keynsianism with the Reagan seal of approval.

Original Post by trustwomen:

Uh, do no politicians pander to the poor and working classes where you live? Because they do here - those people actually vote, here.

In California? No, at least not beyond "saying" what is necessary to get elected. Of course, there's no follow through.

If you don't represent a major industry (energy in our case) or a major union, you get nothing. If you fall under the protection of either of those, you get what they leave you.

If you're a small business or someone that works for one (+90% of the population) you get squeezed or move. Of course moving doesn't really solve the problem, because at best you end up in the same scenario, with the only real difference being the degree to which you are being squeezed.

lys, the bit about private charities was my point all along. They are accountable to the rich and are not necessarily in the business of ensuring that basic needs are met. Socialist government programs are accountable to voters and are in the business of ensuring basic needs are met. I never said that private charities should be other than they are - just that they clearly are no substitute for a socialist redistribution of wealth, if the goal is to ensure that the basic needs of all citizens are met.

True poverty in the US does not come with cable and cell phones. It comes with homelessness and bankruptcy and great, great incentive towards crime. It comes with four to six people living in a one-bedroom apartment and the power getting shut off every other month. It comes with food banks and clothing drives. There is a segment of the population that complains about being "poor" when they can be argued to be living a relatively comfortable life and spending scarce resources on unnecessary things, like cable and cell phone and cigarettes etc... they are not the ones whose interests I am defending here. (Not to mention those who bought homes valued at five times their income.)

And FWIW, I most certainly am a moral relativist... but more importantly, I am a pragmatist who realizes that the boundaries of a nation (and the laws of a nation) are the most realistic starting point for the reduction of inequality - at least to the extent that infrastructure is renewed and the basic needs of citizens are met. Once this becomes reality, it becomes easier to speak of spreading hope and wealth beyond national borders. Furthermore, it influences other nations to act in a similar way, at least unless they are the US and somehow refuse to acknowledge that illness, crime, poverty, and pretty much any social problem you can think of are worse in their country than in the rest of the wealthy countries of the world, and that this is a direct consequence of the (lack of) social policies.

Original Post by lysistrata:

There is always creative destruction in capitalism.  It's a natural result of innovation and improvement, both of which are good things that make us all wealthier.

Isn't this assuming jobs are always replaced, are replaced proportionally, and within the same population? 

The destruction of 2,000 US jobs in one industry to create 1,000 Chinese jobs in another industry doesn't help the American workers in the rowboats, no matter how much extra training they get (unless it's learning to speak Chinese).

Original Post by ignayshus:

Original Post by trustwomen:

Uh, do no politicians pander to the poor and working classes where you live? Because they do here - those people actually vote, here.

In California? No, at least not beyond "saying" what is necessary to get elected. Of course, there's no follow through.

If you don't represent a major industry (energy in our case) or a major union, you get nothing. If you fall under the protection of either of those, you get what they leave you.

If you're a small business or someone that works for one (+90% of the population) you get squeezed or move. Of course moving doesn't really solve the problem, because at best you end up in the same scenario, with the only real difference being the degree to which you are being squeezed.

Wow, sucks to live in California. Here, the "pandering" actually has teeth because of the huge number of social activist groups who really do mobilize the vote. We have people taking to the streets for the smallest adjustment of social benefits in Quebec - like when they raised the cost of daycare from 5 to 7 dollars a day (per child), you should have seen the protests! Or whenever they talk about unfreezing tuition rates, which remain the lowest in Canada - I will have a total student debt of 22 000 dollars (for all four years of medical school combined).  For that matter, there is constant complaint about the lack of new social housing units, and "greedy landlords" who try to raise the rent between tenants (also not allowed under rental law - except for the basic 1 or 2 percent you're allowed to increase it every year).

Honestly, Americans would lose it if they realized just how socialist we are in Quebec, and we are right next to you! (We're not next to California, though - and let's face it, we have arguably managed to influence Vermont.) I won't even go into the socialized car insurance and taxpayer-funded injection sites.

I tried to learn japanese once.

FAIL.

Original Post by trustwomen:

Original Post by ignayshus:

Original Post by trustwomen:

Uh, do no politicians pander to the poor and working classes where you live? Because they do here - those people actually vote, here.

In California? No, at least not beyond "saying" what is necessary to get elected. Of course, there's no follow through.

If you don't represent a major industry (energy in our case) or a major union, you get nothing. If you fall under the protection of either of those, you get what they leave you.

If you're a small business or someone that works for one (+90% of the population) you get squeezed or move. Of course moving doesn't really solve the problem, because at best you end up in the same scenario, with the only real difference being the degree to which you are being squeezed.

Wow, sucks to live in California. Here, the "pandering" actually has teeth because of the huge number of social activist groups who really do mobilize the vote. We have people taking to the streets for the smallest adjustment of social benefits in Quebec - like when they raised the cost of daycare from 5 to 7 dollars a day (per child), you should have seen the protests! Or whenever they talk about unfreezing tuition rates, which remain the lowest in Canada - I will have a total student debt of 22 000 dollars (for all four years of medical school combined).  For that matter, there is constant complaint about the lack of new social housing units, and "greedy landlords" who try to raise the rent between tenants (also not allowed under rental law - except for the basic 1 or 2 percent you're allowed to increase it every year).

Honestly, Americans would lose it if they realized just how socialist we are in Quebec, and we are right next to you! (We're not next to California, though - and let's face it, we have arguably managed to influence Vermont.)

But not New Hampshire. 

Original Post by santonacci:

Original Post by lysistrata:

There is always creative destruction in capitalism.  It's a natural result of innovation and improvement, both of which are good things that make us all wealthier.

Isn't this assuming jobs are always replaced, are replaced proportionally, and within the same population? 

The destruction of 2,000 US jobs in one industry to create 1,000 Chinese jobs in another industry doesn't help the American workers in the rowboats, no matter how much extra training they get (unless it's learning to speak Chinese).

Jobs wouldn't be fleeing the country for the third world did government policy not make it so expensive to have employees that a US manufacturer cannot compete with foreign manufacturers.

Original Post by lysistrata:

But not New Hampshire. 

I must admit that the only two things I know about New Hampshire are:

1) "Live Free or Die" is the state motto

and

2) It's THE place to buy cheap booze on the way back from visiting Boston.

And as always, lys, it's been fun agreeing to disagree with you. ;)

Original Post by trustwomen:

lys, the bit about private charities was my point all along. They are accountable to the rich and are not necessarily in the business of ensuring that basic needs are met.

 This is not always true.  As someone who works for a private charity I can tell you that we're regulated to within an inch of our sanity and we are vastly more efficient at making sure the basic needs of our clients are met than the government.

Original Post by lysistrata:

Jobs wouldn't be fleeing the country for the third world did government policy not make it so expensive to have employees that a US manufacturer cannot compete with foreign manufacturers.

-It wouldn't be so expensive to have employees if you didn't have to pay for their healthcare

-There are other ways to favour domestic production, indeed it's how domestic production was encouraged during the "boom" postwar years - except that "protectionism" has become a dirty word inasmuch as it dares to interfere with the profit margins of corporations.

Original Post by trustwomen:

lys, the bit about private charities was my point all along. They are accountable to the rich and are not necessarily in the business of ensuring that basic needs are met. Socialist government programs are accountable to voters and are in the business of ensuring basic needs are met. I never said that private charities should be other than they are - just that they clearly are no substitute for a socialist redistribution of wealth, if the goal is to ensure that the basic needs of all citizens are met.

True poverty in the US does not come with cable and cell phones. It comes with homelessness and bankruptcy and great, great incentive towards crime. It comes with four to six people living in a one-bedroom apartment and the power getting shut off every other month. It comes with food banks and clothing drives. There is a segment of the population that complains about being "poor" when they can be argued to be living a relatively comfortable life and spending scarce resources on unnecessary things, like cable and cell phone and cigarettes etc... they are not the ones whose interests I am defending here. (Not to mention those who bought homes valued at five times their income.)

And FWIW, I most certainly am a moral relativist... but more importantly, I am a pragmatist who realizes that the boundaries of a nation (and the laws of a nation) are the most realistic starting point for the reduction of inequality - at least to the extent that infrastructure is renewed and the basic needs of citizens are met. Once this becomes reality, it becomes easier to speak of spreading hope and wealth beyond national borders. Furthermore, it influences other nations to act in a similar way, at least unless they are the US and somehow refuse to acknowledge that illness, crime, poverty, and pretty much any social problem you can think of are worse in their country than in the rest of the wealthy countries of the world, and that this is a direct consequence of the (lack of) social policies.

Trust.  Socialistic government is still government.  It is still "accountable" only to those who have power and influence.  It is still highly corruptible.  It is still, ultimately, about tyranny - using the police force of the state - rather than liberty - "live and let live."

Let's be clear.  If 51% of the population voted that nobody should be allowed to own more than $100,000 in property or receive more than $35,000 income, and anything in excess would be taken away and redistributed among the poor, is that ok?  Morally and practically?

Original Post by lysistrata:

Jobs wouldn't be fleeing the country for the third world did government policy not make it so expensive to have employees that a US manufacturer cannot compete with foreign manufacturers.

Jobs aren't "fleeing" the country, they're being willingly shipped out when the profit margin isn't quite as steep as the previous quarter.

Exactly what employee protections should be expendable?

Original Post by trustwomen:

Original Post by lysistrata:

Jobs wouldn't be fleeing the country for the third world did government policy not make it so expensive to have employees that a US manufacturer cannot compete with foreign manufacturers.

-It wouldn't be so expensive to have employees if you didn't have to pay for their healthcare

-There are other ways to favour domestic production, indeed it's how domestic production was encouraged during the "boom" postwar years - except that "protectionism" has become a dirty word inasmuch as it dares to interfere with the profit margins of corporations.

We don't have to pay for health care.  We do have to pay minimum wages, payroll taxes, unemployment and worker's comp insurance, though.  I pay as much to the government for my one employee as I pay her.

There may be ways to promote domestic production, but there is no efficient way of overcoming comparative advantage.

Original Post by santonacci:

Original Post by lysistrata:

Jobs wouldn't be fleeing the country for the third world did government policy not make it so expensive to have employees that a US manufacturer cannot compete with foreign manufacturers.

Jobs aren't "fleeing" the country, they're being willingly shipped out when the profit margin isn't quite as steep as the previous quarter.

Exactly what employee protections should be expendable?

Hmm, you make it sound like corporations should stand firm to be voluntarily bankrupted by cheap Chinese and Indian labor.  Would that be better for the US economy?

All employee protections should be expendable, santo, with the possible exception of safety requirements.  If GM workers would rather not pay into a government-run retirement system and work for less than minimum wage rather than lose their jobs to China, they should have the freedom of contract to do so.