What should replace capitalism?

[John_Mace]

@Diogenes_the_Cynic

Yes it did belong to them. They produced it. You can use that same rationalization to say that the serfs working on the medieval feudal farms of the past were not really being exploited because their lords owned the farms. That entire way of thinking is sick and diseased, and it’s what we have going on in the US.

Then you do think capitalism needs to be replaced, because under a system of capitalism, it most certainly did not belong to them. And a comparison of workers in the US to medieval serfs is simply an appeal to emotion.

Agnostic Pagan: All of the things you advocate could be done voluntarily in our current system. Why do you suppose they aren’t the norm?

Can your system be brought about and maintained in a liberal democracy? Do you honestly believe that real human beings would vote for such a system and continue to vote for it should it someone come to be? Do you honestly think the US could compete in the world economy under such a system?

[monstro]

@John_Mace

Sorry to snip your long post and focus on this, but I think it’s important (as the OP asked) for us to define what we think capitalism is before we talk about what replaces it. What you have described is not capitalism. It might be called consumerism, but capitalism is simply free people trading goods and services freely. It can exist in the context of shrinking resources or populations as well as increasing resources or populations. Private ownership of the means of production, whatever the scope of those “means” are.

If capitalism is “free people trading goods and services freely”, there would be no government regulation, right? Because people would be free to produce and sell whatever they want, to whomever they choose to, at whatever price. Damn the costs. Now you can tweak the environment so that this system functions at low power (nobody’s being exploited, everyone’s in it to win it) or high power (“I got mine so ya’ll better get yours and shaddup already about the unfairness of it all”).

But it seems to me without external constraints, it will always lead to “high power”. Because the system works via competition, and in order to compete you must undercut, and in order to undercut, something must be sacrificed (product quality, laborer’s pay, safety measures, laws and morality, etc.). When the system is just beginning and the marketplace is small, everything’s fine. But when suddenly there’s enormous demand for a commodity (such as, say, cotton), then all hell breaks loose as people scramble for what’s “theirs”. Damn the consequences.

If you say, well, we can have a capitalism but we should have some regulation to keep it from going to the extreme, then I can get behind that view. It’s just defining what’s “extreme”. Unfotunately, whenever a proposal is made to put the brakes on all this “freedom” in the market, that proposal is knee-jerkishly labeled as a socialist one. And probably sponsored by a homersexual! It is my belief that capitalism, via the media and political forces that worship at its throne, has installed this deeply-entrenched blockade into our society so that any kind of control is seen as “anti-American” and thus Of the Debil.

[Diogenes_the_Cynic]

@John_Mace

Then you do think capitalism needs to be replaced, because under a system of capitalism, it most certainly did not belong to them…

I don’t see anything wrong with capitalism being replaced, but I’ll settle for checks and regulations.

And the wealth does belong to the laborors. Wealth is not just physical resources. Coal is worthless in the ground. Coal is only made wealth by labor. That labor is part of the wealth. We act like the wealth is entirely in the coal when it’s really coal + labor, with labor being by far the most important part.

“Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration.”
-Abraham Lincoln

Current corporatocratic ideology has Lincoln’s priorities exactly backwards.

[Martin_Hyde]

@Johnny_L.A

Social Democracy.

Sorry, you didn’t sell that one to me at all. Current engine is going to stay in place.

Do you even have a brochure for yours?

[Martin_Hyde]

@don_t_ask

Unfortunately I am off to bed but could you briefly explain who the all is that enjoys the niceties of life and explain why those that don’t need to be excluded. And maybe you could explain why that is a good result for capitalism.

I don’t see what in my original post you are specifically referencing. Absent that I don’t particularly understand your question, when you come back and rephrase it I will be happy to answer.

[Wesley_Clark]

I thought moving away from capitalism to regulated capitalism was what has always historically happened. At first people are just happy to have any job no matter the health risks or environmental impact. But then you need the state to step in to protect labor rights, environmental issues, sustainability, inequality etc.

I think in the US for ideological reasons we’ve moved away from regulated capitalism more towards unregulated. But I wonder if that is more an aberration than a general rule of thumb since movement conservatism was behind that shift. Did other wealthy nations undergo massive deregulation?

[Agnostic_Pagan]

@John_Mace

Agnostic Pagan: All of the things you advocate could be done voluntarily in our current system. Why do you suppose they aren’t the norm?

Can your system be brought about and maintained in a liberal democracy? Do you honestly believe that real human beings would vote for such a system and continue to vote for it should it someone come to be? Do you honestly think the US could compete in the world economy under such a system?

Yep, it can be done voluntarily. All I am doing, taking the bits and pieces that do work and try to string them together. As to why they are not the norm? Because most do not want to think on those scales and attempt wholesale reform. Plus the plutocrats have very vested interests (no pun intended) in keeping the things they way they are. And most of these changes would require rather intensive legislation that they will never back.

Do I think it can ever be brought about? Not by the current generation of leaders, but I have hope for the youth of today. That is why I said 20-50 years for a complete transition. And the US will probably be the last economy to do so.

Personally, I am more concerned with 3-4 billion getting screwed over by the capitalist economies than the 300+ million sitting at the top doing the screwing.

So bits and pieces is all we get at for the moment. I like to view them as pilot programs, and as they endure, their success will spread.

Reform moves slower than revolution, but it does move forward. 120 years ago corporate feudalism did seem the norm, and is still in some places. iPhones should be installed with an app showing the dorms where the workers live that built the damn things. Steve Jobs - great for the American consumer, not so great for the Chinese worker.

[Bryan_Ekers]

SUPERcapitalism.

[SeldomSeen]

I’m with Diogenes and several others here. Capitalism in and of itself is not evil. Unrestrained laissez faire predatory capitalism is bad. I think the best opportunity for a sane and progressive society is an atmosphere of capitalism properly regulated, with strong unions and progressive taxation and reasonable anti-trust laws to prevent monopoly and profiteering. And I support protectionism in the form of import tariffs…if someone seeks to profit by importing goods made in places where labor and resources are unduly exploited, then a tariff should be added to those goods to bring the cost into parity with domestic goods. The revenue from these tariffs can then be used to aid and benefit domestic business & labor. I believe furthermore that labor and management ought to be cooperative rather than adversarial. As James Michener said, "pay a man a high wage, then tax the hell out of him for improved infrastructure and services.
SS

[John_Mace]

@Diogenes_the_Cynic

I don’t see anything wrong with capitalism being replaced, but I’ll settle for checks and regulations.

And the wealth does belong to the laborors. Wealth is not just physical resources. Coal is worthless in the ground. Coal is only made wealth by labor. That labor is part of the wealth. We act like the wealth is entirely in the coal when it’s really coal + labor, with labor being by far the most important part.

“Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration.”
-Abraham Lincoln

Current corporatocratic ideology has Lincoln’s priorities exactly backwards.

Abraham Lincoln was not an economist. At any rate, this is a hijack of the thread, and I’m just going to agree to disagree. However, you cannot be talking about capitalism if you say that the workers own the output of a factory.

Of course, when you sell you house, you are more than welcome to split your gain with the plumbers, electricians, roofers, and anyone else who did work for you on that property. Somehow I doubt that will happen.

[Diogenes_the_Cynic]

@John_Mace

Abraham Lincoln was not an economist. At any rate, this is a hijack of the thread, and I’m just going to agree to disagree. However, you cannot be talking about capitalism if you say that the workers own the output of a factory.

They own their own labor, and that labor is essential to the end product. It’s more essential than the raw resources. When they are compensated at a rate that is in gross disparity to that of the ones owning the capital, then they are essentially being stolen from.

Of course, when you sell you house, you are more than welcome to split your gain with the plumbers, electricians, roofers, and anyone else who did work for you on that property. Somehow I doubt that will happen.

I don’t understand your analogy. Those people were already compensated for their labor.

[Martin_Hyde]

I’m actually surprised things in this thread are going as well as they are. A few people have given decent definitions for capitalism, but some of its most vehement detractors have not really defined it very well.

I wasn’t playing a game by not stating a definition from the beginning, I just sort of wanted to see where everyone was in terms of how they defined the beast.

Capitalism doesn’t have a firm definition that is “right” or “wrong”, it’s a vacuous term and that’s just the way it is. However, my definition (and the one I would defend and debate) is thus:

Capitalism is an economic system in which private individuals, solely or collectively, seek to use capital to purchase the means of production. This use of capital represents a risk to the individuals, and those individuals seek to use their ownership of the means of production to create wealth above and beyond what they invested. Thus, their investment was made in the hope that the means of production can be used to generate products that are worth more than their investment and that can be sold at a great enough margin to secure a profit.

Labor is an important element of capitalism, but it is not a means of production. Means of production specifically means the non-human elements of production. If I’m a coal producer my means of production will be the land I own that has coal deposits, equipment I own that is used to extract that coal from the earth, and any facilities I own for coking or other post-extraction processing of the coal in order to get it to market. Labor is human effort required to operate the means of production, labor is thus something I pay for over and above the means of production.

For my venture to generate the profit I desire, the cost of my labor and other operating expenses cannot exceed the revenue I am able to secure from selling the end product. If it does, my model is not sustainable, I will lose my investment.

Profit is incredibly important in capitalism. Profit plays directly on the natural greediness of human beings, human greed and desire is absolutely the major driving element of capitalism. Some decry this, that’s a position my church (the RCC) has sort of held for a long time. Of course, as a practicing Catholic I sort of note with irony that the Church has long lamented human greed and been relatively socialist in leaning when the Church is one of the must enduring symbols of personal greed in history.

The thing about capitalists is their whole existence is about making profit. Because of this, if their customers want certain things and are willing to pay more for it, or are willing to not purchase a certain product that lacks certain features, the capitalist will endeavor to adjust to this rapidly. The capitalists that fail to respond to the desires of their customers will be driven out of business by the other capitalists.

This self correcting mechanism, driven by desire to maximize profits, is the strongest aspect of the system. The capitalists get very up to date feedback in the form of how much profit they are seeing, and when their profit starts to decrease they will endeavor to find out why. When they do, they will endeavor to rectify the situation.

Capitalism is not synonymous with a free market, but you cannot have capitalism without a free market. You can have a free market without capitalism. If you look at historical economics you see in the past thousand years a move from Feudalism and manor systems to a gradual development of a “mercantile” system and a system of heavily controlled craft labor. This system had some capitalist elements to it. From history I have seen that capitalism is a more technologically sophisticated form of a free market system, and it seems that it naturally develops as free market societies become more technologically advanced.

I will also define free market, because that is important to the discussion as well.

A free market is one in which the participants in the market are the ones who determine what goods will be produced, how they will be used, what they will be priced at and where and how they are sold. Just like capitalism, free market doesn’t have an unambiguous definition, but the one above is the one I’m working with. A free market can exist without capitalism. Participatory Economics which was mentioned up thread is a proposed type of system in which the free market would still exist but capitalism would not, I’m happy to see that it was brought up and plan to address it in a later post.

Agnostic Pagan’s system on the other hand I’m not sure how to categorize it and will have to explore it further to see exactly what is being proposed.

[foolsguinea]

“Mutual Individualism” was the term Harry Harrison came up with for an idealistic quasi-libertarian society that shared the wealth of its material culture. (The Stainless Steel Rat Gets Drafted, iirc.) He meant it to be silly, but it sounded pretty good to me.

[John_Mace]

@Diogenes_the_Cynic

They own their own labor, and that labor is essential to the end product. It’s more essential than the raw resources. When they are compensated at a rate that is in gross disparity to that of the ones owning the capital, then they are essentially being stolen from.

You’re right. They own their own labor. And they are free to sell it or not. But you don’t own something just by touching it or even moving it from point A to point B. Not in a capitalist society, you don’t.

I don’t understand your analogy. Those people were already compensated for their labor.

Anyone who worked on your house since you bought it. That would include any house cleaner or gardener you employ, as well.

[Little_Nemo]

In theory, a planned economy could work. In reality, they usually break down. But maybe with AI systems we could develop a planned economy that would be able to handle the amount of information necessary and could avoid the flaws caused by self-interest.

[John_Mace]

Martin: I think most people around here mean “the free market” when they use the term “capitalism”.

[The_Other_Waldo_Pepper]

@Diogenes_the_Cynic

And the wealth does belong to the laborors. Wealth is not just physical resources. Coal is worthless in the ground. Coal is only made wealth by labor. That labor is part of the wealth. We act like the wealth is entirely in the coal when it’s really coal + labor, with labor being by far the most important part.

So let’s say I’m ready to labor and you own some worthless-in-the-ground coal. And maybe I make you an offer you’re free to accept or reject, and maybe you make me an offer I’m free to accept or reject. What happens next?

They own their own labor, and that labor is essential to the end product. It’s more essential than the raw resources. When they are compensated at a rate that is in gross disparity to that of the ones owning the capital, then they are essentially being stolen from.

What if the laborers “essentially” consent to that compensation rate, free as they are to accept or reject the offer in question?

[Otocor]

It is a shame that people fear communism as much as they do. The reason a capitalist United States has ‘worked’ for so long is because the country was founded by a select group of thinkers at the right time in world history for it to work. Really, it was just a matter of catching “lightning in a bottle.” The only thing that facilitated its ‘success’ was luck.

It puzzles me why people frown on communist nations so much. I do not understand why someone would oppose a system that guarantees absolute freedom and equality for everyone.

[John_Mace]

@Otocor

It is a shame that people fear communism as much as they do. The reason a capitalist United States has ‘worked’ for so long is because the country was founded by a select group of thinkers at the right time in world history for it to work. Really, it was just a matter of catching “lightning in a bottle.” The only thing that facilitated its ‘success’ was luck.

Except that it has worked in many, many other countries, too. Where are getting this nonsense that was just “luck”?

It puzzles me why people frown on communist nations so much. I do not understand why someone would oppose a system that guarantees absolute freedom and equality for everyone.

Yeah, especially when they see how splendidly it worked out every single time it has been tried by a nation.

[The_Other_Waldo_Pepper]

@Otocor

It puzzles me why people frown on communist nations so much. I do not understand why someone would oppose a system that guarantees absolute freedom and equality for everyone.

IIRC, Ford pointed out that a government big enough to give you everything you want is a government big enough to take everything you have.