Yay, Lordy! Greed is good, brother Lemur. Can I get an amen?
[Oh, except even middle class wages are down 20% over the past twenty years (hey, you didn’t cite first, but you might try Ralph Nader’s site). Who is this “we” you speak of?]
Amen, brother Lemur. There is no alternative to capitalism! All else leads to hellfire and perdition for Big Hank told us so. Halleluleeaaahh. Now we know the paygans, with their wicked ungreedy and umimpatient souls will be certaintly cast into the pit, for Hank would never lie to us. For no one who does not serve Hank can decrease his suffering. Yay, though he tells us to lie and exploit others for profit, we shall feel no evil, for he told us he would not lie to us and we most certaintly believe him – for by faith in his lies, ye shall be saved.
Now the breaking of the change. This quarter is Hanks body. It has been offer up for us, for without it we can not survive. At the last gluttony, Hank took this quarter and said to his followers, who has change? And lo, Brutus IsCareInot having exploited his fellow man in the sacred exploitation, exchanged it for two dimes and a nickle in this one everlasting, perfect covenant. And now, the passing of the basket.
I’m afraid that your dissertation reveals your biases.
I said nothing about regulation.
You assume that regulation must be imposed by government or “self-imposed”. This seems to happen often when a pro-market person says the market is self-regulating: The assumption is made that individual participants (or groups) are imposing regulation on themselves.
To be honest, your post swerves way around my point and continues a hijack of this thread that I had hoped would end quickly.
Your general thrust here is correct. We have a problem because of differing definitions (or theories). However, that, in and of itself, does not mean that the debate is finished. We can evaluate our competing theories and see which seems more useful.
dal_timgar:
If you say so. You are also supposed to stick to the topic of the thread, but you are obviously not forced to.
I suspect this probably happens to you a lot.
jmullaney:
Why would we want to? It sounds like you are making my point for me.
You guys keep saying this, but aren’t offering much in the way of evidence.
And we all know that labor creates value…
Collounsbury:
Don’t let an ideological slant cause you to blindly accept a questionable case for governmental invervention.
It remains controversial and complicated.
Sam Stone:
I agree.
This, I believe, is what we are trying to demonstrate. Unfortunately, I’m afraid your examples don’t make a case either way, because they are based on “capitalistic” assumptions.
What exactly is my natural state? How did I come to be unnatural?
So, your question is, what will happen when people stop wanting things? I think that means they are dead. Or we have abolished need.
OldScratch:
The problem is that your critique of capitalism is based on an acceptance of the Labor Theory, which we don’t accept. Since we don’t agree with the first part, the rest is inconsequential until you convince us that the Labor Theory is correct.
I just did.
Are you trying to verbally strong-arm us? If I start my argument by saying the moon is made of cheese, and then continue to explain why that means that space flight is impossible, you can dispute my whole argument by offering evidence that the moon is not made of cheese.
And what do you mean by “fundamentally flawed”? Do you mean “not perfect”? Then, we agree. Do you mean “doomed to failure”? Then, we disagree. And I’ve got more history on my side than you do on yours.
More strong-arming? You communists sure are pushy.
Agree. However, there is an implicit assumption here that this use value is one measurable number. This is not the case. A computer has utility for me. A curling iron does not. The utility of any commodity is different for every potential consumer.
Purple passage of prose.
And the values of x,y, and z vary for each individual.
Again, for one person, at one point in time.
You’re pushing it here.
Wrong. Dead wrong. Frighteningly wrong. This something is not “contained” in the commodity. It is contained in the potential consumer. That is why it varies among individuals and across time.
[/quote]
No need to go any further. The rest of your exposition builds on this mistake. Exchange value is not a static measure of some inherent aspect of a commodity like area is a measure of a rectangle. It is a measure of the relative values of the items being exchanged to the people doing the exchanging at the time of the transaction.
You cannot extract the people from the equation, my friend.
jmullaney:
On preview, I just noticed your latest diatribe. I think you may be on the verge of what my grandmother called a “conniption”.
Jmullaney: Please, I’m worried about you. Just take a deep breath. Have a cup of tea.
Look. Greed is not good or bad, it is simply a normal human emotion like love or anger. It doesn’t upset me that people are greedy, it doesn’t please me either. Likewise, I’m not happy because you are ungreedy, neither am I upset.
I don’t care that the person who sells me the groceries is greedy or not. It is irrelevant. I don’t care if they are greedy or not, I care whether they are cheating me, or robbing me, or selling me shoddy merchandise, or charging me too much.
What is so wrong with people having desires and wanting to fulfil them? What is wrong or right is how they go about fulfilling those desires.
The Gospel of Marx, as translated by jmulloney:
Man work. Man bring home food, home and clothing. Man happy.
Grunt.
You and I, we have different interpertation of the word greed. To me, greed means wanting to acquire huge ampounts of money for no purpose, and you know, you’re right - anybody who wants money for its own sake is an idiot. But how about people who want money so they can take a slow cruise to the Bahamas? Or people who want to take some time off to study 19th century French poetry? Are they greedy?
Perhaps Karl Marx and his ilk would be happy working hard and thinking Big Thoughts. They’re simple people, with simple needs. I’m a complicated person, with complicated needs. Yes, I want to live, but I want a lot more from the world. I need art, and culture, and pleasure, and fun. I *demand * them. And I don’t think I’m alone.
So you know what - I’m going to go out and have fun, so you can just stay on home and be stable and efficient. I want o be happy, and I want everybody else to be happy too, because I’m greedy.
Marx makes a fundamental error in the labor theory by treating the value of objects as some static number. Commodity X will always have a value of n times commodity Y. This simply isn’t true. In his day it was closer to being true, but even he could see that his model broke down for many types of goods.
So, as many quacks and flakes tend to do, he jiggered the books. He excluded all the goods that didn’t fit his model for one reason or another. When he was left with only those that did, he declared the model a success.
In college, I learned that a good way to get a high mark in lab class was to plot your curves first, then make your data fit the curve. Apparently, this is also the way to lead about a billion people into lives of misery.
The labor theory fails in many ways. As an economic principle, it fails a simple test - it cannot predict prices. One of the reasons Communist countries have been so inefficient is for this reason - the inability of their theories to predict prices and therefore demand for a specific product. This leads to constant oversupplies and shortages.
In the Soviet Union, people were paid on paper a reasonable wage. But their rubles couldn’t buy anything. When a line would form somewhere, the people would join it without even knowing what they were buying. The money was worthless anyway, and if they didn’t need whatever was at the end of the line perhaps they could barter with it or give it to a friend who did. Because there was no feedback as to the real demand for items, the government could not optimize production.
Capitalist market theory, on the other hand, believes that ‘value’ is determined by the price system, which in turn is dependent on supply and demand. And this DOES predict prices. The Central Bank has been very good at controlling the price of money by manipulating the supply/demand curve for it. Economic forecasts using non-Marxist mathematics are surprisingly accurate.
You know, even Marx was a big fan of capitalism. Engels was an aristocrat. Marx believed that it was the success of capitalism that would lead to such productive efficiency that it would pave the way for a LESS PRODUCTIVE communist lifestyle. He admits that Communism is less productive than Capitalism. Where he failed (aside from his lack of ability as an economist) was in his vision.
Like the patent officer who resigned in the late 1800’s “because everything had already been invented”, Marx thought that Capitalism would soon run out of ways to continue expanding, and that people would soon run out of things to want. Of course he was wrong, and today’s economic expansion is one of the largest in history, even though even the poorest in most capitalist countries live better than Kings did in Medieval times.
I was not the one make the a priori assertion. It strikes me that there is a large body of work supporting the analysis that the Depression represented a serious crisis which had moved beyond the realm of self-correction * within a realistically acceptable time-frame*. I am sure that eventually the markets would have righted themselves, however at what short and medium term costs, and what discredit to free markets in general? Social stability is quite useful for maintaining a system. Of course government invertentions in such traditional realms as protective tarriffs also contributed to the situation. The conservative position that things would take care of themselves wore out its welcome as the crisis progressed. I have never read a convincing demonstration that Roosevelt’s rather timid Keynesianism was responsible for delaying recovery. All in all, the extreme case of the Depression is one of the best cases for a necessary government intervention (alhtough of what kind is quite another matter). Bof course one could adopt the position if only one could weather possible revolution all would have been well.
Accepting the OP’s conclusion does not mean you have to accept the labor theory of value, it is simply a small section of the OP. Did you even read it? Again, you are disputing one small claim, yet not disputing the conclusions.
**
Well neither really. It’s more of a middle ground. Capitalism is fundamentally flawed in that it will go through a series of increasingly bad booms and slumps. That is the premise of the OP, and that is what no one has offered any evidence against.
**
Now here is where we might have to come to a standstill. I believe you are a libertarian. My understanding from my debates with libertarians is that they refuse to acknowledge that a “society” exists. It is all made up of individuals. You can’t talk of societal norms, or socital morals, or crimes against humanity. It’s all baased on the individual. Most people don’t hold that view, you do (or I think you do, if you don’t we can continue to debate), I accept that. However I can’t debate with someone who holds that view. We just won’t be able to agree. You’ll be talking apples, me oranges. So, I’m going to be debating with people who admit that there can be talk of society. If you want to accept that axiom, welcome aboard. If not, then we’ll first have to have that debate. Go and open up another thread, and I’ll be more than happy to join you.
Anyway…for those who admit that “society” exists.
I can speak of what a gun is useful for. Obviously, some people will not have use for it. But what we are speaking of here is use in the abstract, as it applies to the mass of humanity. A gun, even when possessed by someone who has no use for it, has a use-value. If given to someone that can use it, that use-value instantly takes form. the use-value, as it applies to the object in abstract, does not change.
**
Again, I’m speaking of abstracts here. You can speak of the average use of an object. This is how markets are made. You may have noticed that prices tened to average out. No one is willing to pay $65 for a coke, and no one is stupid enough to charge that much. Coca-cola will not charge less than the cost of manufacture for coke either. With a case of coke, you can say that it is worth x-wood, y-beer and z-salt. In reality, the ammount of x remains relatively constant. It does not vary wildly between person to person based on their need. Why? Because of this. If it takes 3 hours of labor to buy coke, and 4 hours of labor to chop wood, someone isn’t going to trade 20 hours of labor for x-wood. If they do, they will nto be able to resell it for that 20 hours of labor. The woodis worth 4 hours of labor, and that is what people are willing to trade for it. While, you might find an insane individual who is willing to trade more, the value to society as a whole has not changed.
**
To the owner of a commodity, every other commodity is, in regard to his own, a particular equivalent, and consequently his own commodity is the universal equivalent for all the others. But since this applies to every owner, there is, in fact, no commodity acting as universal equivalent, and the relative value of commodities possesses no general form under which they can be equated as values and have the magnitude of their values compared. So far, therefore, they do not confront each other as commodities, but only as products or use-values. In their difficulties our commodity owners act and transact before they think. Instinctively they conform to the laws imposed by the nature of commodities. They cannot bring their commodities into relation as values, and therefore as commodities, except by comparing them with some one other commodity as the universal equivalent.
The reason why capatilism doesn’t go through increasingly bad depressions is because it didn’t. In America it went through a small depression then got out of it. Experience defeats flawed logic.
Wrong and Wrong.
Im certain there are plenty of people who would pay thousands of dollars for a coke if someone charged that much because they can. (for example on ebay selling everquest characters the average cost of a level 50 guy was 500 dollars, however 1 such level 50 guy sold for 10,000 because 2 people bidded it up that high)
Also there are plenty of times when the cost is less than the manufacture. Mostly when 1 company wants to undercut another one and drive it out of buisness but thats illegal:) However people do this as a going out of sale or something like that gimmick.
Forget about labor == value. Forget about capitalism. Forget about Marxism.
Today the people at the top in business are trying to figure out how to produce product for essentially zero labor/production cost. Technology is making this possible. The problem is that there is competition. Other companies producing similar products have the same advantages. This is driving a tremendous arms race in technical innovation. So the thing that is really of value is innovative energy and now the push is to automate that as well.
These Marxian arguments sound very quaint to me. Labor (productive capacity) is the most malleable commodity of all these days.
“Club Med – a holiday in other people’s misery” – anonymous grafitti, Paris revolution of 1968.
So, greed is to aquire money and not spend it? Profound!
I’m certain the people who work in third world sweatshops to provide for your wants would agree with you. They are more than happy to serve you! Happy, happy!
You seem to confuse needs and wants.
And you’ve earned it. Go buy yourself a coke, you big lug.
Well, I just read this entire thread in one sitting, so there’s a lot of information left to process. However, I just wanted to take issue with the Labor Theory of Value, just like Smartass and Sam Stone have done. I’m sorry if I’m just repeating what they have said, but I’m trying to get this into a condensed form where its understandable to someone like me :-).
Basically, I think the whole Labor Theory is total hogwash. Here’s why:
Accepting for now that this is true, let us call this third thing (as we do in today’s system) money. Thus, let us now just use monetary value to discuss this, because, as oldscratch said, it is convertible to any other commodity in fixed proportions (By the way, I believe this to be untrue, I’m just going by this since it is straight out of oldscratch’s argument).
As you, said, no one will pay 65 dollars for a coke. This is simply because nobody values coke at 65 dollars a can. But even if you look at society as a whole (as you ask us to do), all of society values that can of coke (which requires exactly the same amount of labor to produce, no matter what the situation) differently at different times. When at a ballpark, society as a whole is perfectly willing to pay a buck fifty for 12 ounces of coke. When at a vending machine, very few people actually complain about paying 60 cents for a can of mountain dew. At a supermarket, however, if you try to charge more than say 40 cents a can, no one will buy a 12 pack. And, if people weren’t willing to pay those prices, as you yourself said, no one would be stupid enough to charge that much.
But this is the same can we’re talking about here. It requires exactly the same amount of labor to produce. But its valued differently by society as a whole depending on the situation. Therefore, how exactly is the amount of labor required to produce that can related to the amount that the can is sold for?
I think there’s more to this argument, but its getting late, and thats about as far as I can get.
Why do you feel that people have to work in sweatshops as a neccesary consequence of my wanting to go on vacation? Do you feel that if I make more money, I have to get the money from somewhere, so it must come out of the labor of the oppressed workers?
So, the more I make (the more value I create), the less others have? No. It is not true. In fact, the more I make (the more value I create) the MORE others have. If I create lots of value, I can exchange it for other things of value. So if I create value, then others can exchange the valuable things they create for the valuable things I create. So, the more I create, the more valuable their creations are, since the potential universe of valuable things they can exchange their valuable things for has increased by that small amount.
I’m glad I’m not in the position of a sweatshop worker. But I ask you…would the sweatshop worker be better off or worse off if I didn’t buy the products they produce? I imagine that you might say they would be better off if I refused to buy their products. But what then? Would the worker really be happy if the factory they work at closes? What is the alternative?
You are fond of saying that the ends don’t justify the means…that even if capitalism makes everyone more prosperous it is still wrong. I still don’t understand this.
But it is our belief that Marx predicted the failure of capitalism because of the labor theory of value. We believe that if we can refute the labor theory of value then the rest of your argument is moot. That’s why we’re still stuck here.
Why do I think this? From what I read, it seems that Marx thought that there was no way that a capitalist could make a profit without extracting labor from the workers for less than it was worth…that’s why he felt the capitalists exploited the workers, right? And since the workers were obviously getting less than they deserved, it was obvious that they would become impoverished, and would therefore eventually come to see that they had no reason to support the system…they could set up a new system without a profit motive, where everyone was compensated fairly. “Workers of the world, unite, you have nothing to lose but your chains!” And so capitalism eventually collapses when the workers are so exploited they literally have nothing to lose.
But what if the labor theory of value is incorrect? Then capitalists could make a profit without undercharging their workers. Not to say that they DON’T undercharge their workers. I’m sure they pay as little as they can get away with. But it is not neccesarily neccesary that they pay workers less than they are “worth” to make a profit. It could be perfectly possible for a capitalist to create goods that are more valuable than the sum of values of their materials and labor.
If capitalists can do that, then there is no neccesity for the workers to be impoverished. Of course the capitalist doesn’t care about the workers as long as they are making money. But they can make a profit and the workers can benefit as well. So the scenario of the impoverished workers overthrowing the capitalists is not inevitable. It might happen or it might not happen, but it is not a neccesary consequence.
**
OK, but HAS capitalism gone through a series of increasingly bad booms and slumps? It seems to me that we have our booms, we have our slumps, but they do not seem to be increasing in magnitude. Of course the entire world economy is getting larger, but it seems that the swings (as a percentage of world domestic product) are getting smaller in magnitude. If you have some other economic statistics, I’d like to see them.
**
I don’t understand this. Why can’t you argue with a libertarian? I know you feel that such arguements are not fruitful, but I don’t know why. Are you saying that it is NOT “based on the individual”? I do believe that you aren’t going to convert libertarians to marxism, but does that mean that libertarians aren’t worth talking to? Or that a libertarian critique of Marx is irrelevant? Feel free to ignore this, as you have my other posts. Wait! That’s why you’re ignoring me! You think I’m a libertarian! That my brain works in such a different way from normal people that logic cannot penetrate it! Marxism is so self-evidently true that anyone who doesn’t agree with it after having read it, must be intellectually dishonest!
To borrow one of your tactics, if you don’t respond to this post I will take it to mean that you agree with everything I say…yes, that seems fair…
**
The value of the gun doesn’t change that much when it is exchanged because there are enough people who value guns that it can often be exchanged with one of them. But you must admit that the value of a gun can vary widely over time. Didn’t you say that if I discover a way to make guns for less labor, then I’ve reduced the value of all guns?
But the exact same gun can be very valuable or worthless depending on the social circumstances. If I live in a violent society I would value the exact same gun more than if I lived in a peaceful society. And since lots of people would think like I do, then I would find many fewer people willing to exchange the gun for other valuable goods in a peaceful setting than a violent setting. The gun doesn’t change a bit, but it’s value does. Occording to the labor theory of value, this can’t happen.
**
But if we say that the value is the average, then we are saying that the value does indeed fluctuate. Sure, at any moment there is a theoretical average value. But that value changes from minute to minute, person to person, and place to place. Just because the average value of wheat on the world market is 27 schillings a dram doesn’t mean that you can buy or sell wheat at that price. Usually you never can because there are other costs involved…if you are a farmer no one will buy the wheat at that price because they will have to truck it to the mill, turn it into bread, ship it to the stores, etc.
When a supermarket puts a price on a loaf of bread, it is really a kind of bet. They are betting that enough people will but the bread at that price to pay their costs and give them a profit. If they bet wrong, they lose their profit. If they bet very wrong, they don’t make back their costs. This is why prices are often very similar. A supermarket can look at the price their competitor is offering, and decide that no one who is paying attention would buy their bread at a higher price unless they offer more convienience or some other value.
This is why capitalist pricing is so efficient. There are millions of consumers scrutinizing the price goods are offered at. And there are thousands of people scrutinizing the price goods are purchased at. This means that prices are often uniform. But it does not mean that that price reflects something intrinsic about the good. The price is a bet…“I bet people would buy Chunky Cookies at $X.00/lb.” The producer might be making a good bet or a bad bet, but it is just their particular guess for that day and that store what people will pay.
**
But the value to society HAS changed, depending on the time and place. A glass of coke when you’re trapped at a baseball game is worth more than a glass of coke when you are free to choose other alternatives (like, say WATER). MMMM…water…my favorite…
**
I couldn’t understand what you were trying to say here. Sure, if you call a commodity broker you’ll get a quoted price: “pork bellies are at 2 and a quarter”. Pork bellies can be converted to money, and the money can be converted to other commodities. But the prices of commodities will vary widely depending on supply and demand and perception. So…do you mean that commodities can be exchange for other commodities? Or was there something more?
OK. Oldscratch, I wanna ask you something, and I’d like you to give it an honest answer, since it relates back to the point about libertarians. What is your reason for posting about economic theories? Is it to get people to change their minds and become marxists? If it is, then I can see why you wouldn’t want to debate with libertarians or people who already have strong ideas about economics. But if that’s what you want it’s not going to happen here, since only people with strong ideas about economics are going to respond. Or perhaps you just want to expose people to Marxist ideas, since they probably don’t know much about them. If you want to do that, why wouldn’t you bother talking to libertarians? Or do you just like to argue? Well, I guess that’s why I’m here. Just because I know I’m not gonna convince YOU doesn’t mean that I won’t convince other people lurking.
It’s just that your objection to libertarians struck me as unfair. If you explained what you’re after here, maybe it will seem more reasonable.
if you look at the capitalist system as an economic power game you have to ask “how well do most players play the game?” if large numbers of people are bad players then they are going to tend to loose. one of the strategies in the game is INFORMATION HIDING. if some people are encouraged to make bad decisions due to lack of information other people can win more. so the question becomes how many people have to loose badly enough for the system to fall apart.
this is why i mention “buying a car to be a status symbol” and someone accuses me of being OFF TOPIC. the auto industry wants me to make BAD DECISIONS. cars depreciate rapidly which is bad for my NET WORTH. makes more sense fo me to buy a used car and pay extra on my mortgage. how often do economists talk about the net worth of the average american and losses due to depreciation? sounds like economists think it is good for the economy for most americans to be loosers.
You (the laborer) are a fisherman and on your best day you catch (labor) ten fish. I (the capitalist) have bought a net and I tell you you can use my net (capital) for half your catch. You agree and go catch 100 fish with my net while I (the capitalist) sit on my fat behind. While sitting on my behind I have earned 50 fish thanks to my capital investment in your operation. How does the labor theory of value explain that?
Well, I know how, the net you see is made with labor and that labor is built into the capital return on the net. In this sense, where capital is simply the stockpiling of labor value, supports a labor theory of value. But it is one that fully supports Capitalism.
What you say about information and decisions, dal-onetrick-offtopic-timgar, is of course correct. Where you go keep missing the point with your PLANNED OBSELESCENCE however is in assuming that the aim of the game is to accumulate as much wealth as possible. The aim of the game is actually to accumulate as much utility (read “happiness”) as possible. After all if I have a big fat bank account but no possessions I’ll suffer no depreciation at all but I’ve hardly “won the game”.
New cars and other consumer durables give some people higher utility than the wealth that they must forfeit to own them. If they aim to accumulate wealth in order to get the car then it’d be a bit stupid to not buy it due to worries about PLANNED OBSELESCENCE. You think that this decision is wrong. As a free market participant that is your right - nobody’s insisting that YOU buy the car. But to keep on whining about how nobody realises how they are being ripped off is to fundamentally miss the point that they enjoy their purchase. What do you do with your money?
If this sounds a little personal, then it is. I bought a brand new car. As an economist, I’m more than aware of the effects of depreciation. However since I earn more than I can spend every month anyway, the fact that I may be throwing $20,000 down the drain doesn’t particularly bother me. I made a decision based on my set of principles that since I’m young, you’re only young once and I have the income, I’d just damn the “sensible course” and make myself happy. That was two years ago - I haven’t regretted it. PLANNED OBSELESCENCE can, to use an Americanism, bite me.
if some people can enjoy under-engineered trash that is their problem. however not EVERYONE knows about planned obsolescence therefore the genius economists that NEVER talk about it are handing us a load of CAVEATE EMPTOR bullsh!t.
since all of the auto companies are making junk designed to become obsolete, possibly excepting rolls royce, we FREE americans don’t have the FREEDOM to not buy under-engineered junk.
as an ECONOMIST can you explain why you guys don’t subtract depreciation of durable goods from the Gross Domestic Product to compute the Net Domestic Product? i have emailed my Economic Wargames essay to more than 300 economists by now and noone has explained it. actually only 1 has actually written a response. another called me a looney. i sent back “you’ll never know how much it pains me to be called a looney by a member of a profession that can’t do grammar school algebra.” i hope he didn’t take it personally.
