Snip
Two question:
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This is a bad thing?!?!?
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Where can I get some?
Another way to manage things is the Swiss SS model:
it is not acceptable for insurance companies to refuse health insurance to people (within levels and services set by the government, other services aren’t compulsory)
and everybody must get medical insurance
but the insurance companies set their prices.
Profitable doesn’t mean efficient, tho. I’ve worked for highly-profitable companies which wasted human and physical resources to amazing degrees (almost to the “one person tightening bolts, another one wiping the sweat off the first one’s brow” degree). I’m talking about things like needing 10 signatures for a single lab result; a minimum of 8 of those people had never even seen the sample in the first place.
That’s not socialism. That’s authoritarianism and it’s got nothing to do with how to manage public services and which services should be public.
A lot of their tasks are based on the hunt for profit - finding new business contacts, places to sell their goods and/or services, things like that. Many of those tasks would become unnecessary or irrelevant in a system based on producing for need, not profit, and those tasks that don’t can be performed by the workers themselves. Administration, ordering supplies, and the like.
OK, picture an automotive factory for me. Except there’s nobody working the lines. Absolutely no one. All the machines are off, standing still. No chassis on the conveyor belts, no parts being welded or attached, no paint spraying. Nothing is happening.
If no cars are being made, how can they be sold? How can the company make a profit? How can the boss make any money? This idea is called the ‘labor theory of value’ and it’s a fundamental idea of socialism.
Suppose the company makes Ladas or a car of equal quality. Suppose that it takes 10,000 man*hours to produce one car. What is the car worth? I don’t deny that taking sheet metal and cast iron and turning it into a car can add value, but it doesn’t necessarily if no one wants the output nor can you simply determine the value by calculating the cost of the labor that went into it. A thing is worth what you can get for it period.
Rob
The labor theory of value doesn’t say anything about the quality of the goods or what it can be sold for - or even if it can be sold - on the market. What it does say, however, is that the source of its value (both use-value and exchange value) lies in labor power. A product can’t be used or sold if it isn’t made in the first place; somebody has to work and make it before anything else happens.
Then I have no idea what point you are trying to make.
Wealth is required to satisfy personal utility. If wealth is unnecessary, then you are saying human beings have no desires.
Money arises as a medium of exchange between people to conduct business, and to store wealth. It has always arisen spontaneously in even the most basic of semi-advanced societies.
There also has to be a factory and an idea of what to make and how to make it.
Rob
I believe you’re thinking of the basic theory of economics which states that some, or all, of the 4 components of
- Land
- Labor
- Capital
- Enterprise
Are required to create wealth. I believe the fellow you are debating believes number 2 above - and only number 2 above - is required.
Well then, socialism needs a new analytical framework instead of Labor Theory of Value. One problem with LTV is its underlying tone is apologetic, defensive, and emotional. It is more a prescriptive theory than descriptive one. To me, it’s “prescriptive” because it makes assumptions that society knows (or SHOULD KNOW) the “value of labor” of the products it interacts with. The resultant enlightenment would then cause everyone to be fair with each other economically. This is flawed thinking. (I realize that LTV is not formally defined as “prescriptive” but that’s how I read most writings that support LTV.)
“Descriptive” and unemotional frameworks such as General Equilibrium and/or Game Theory do a better job of describing economic motivations and preferences.
LTV is an interesting intellectual footnote but it is outdated and should not be taken seriously in the 21st century.
The source of value is not in the “labor” – the source of value resides in the evolving “preferences” of the buyer. LTV does not fully account for human “preferences” (rational or irrational). One could also argue that “value” is sourced in both buyers’ preferences and the sellers’ labor. Even if that’s the case, the “preferences” still take precedence over the “labor.”
Imagine… Joe Blow expends a lot labor farting into glass bottles and bottling them up for sale. If nobody in the global marketplace wants Joe Blow’s bottled fart, where is the embedded “value”??? LTV cleverly gets around this zero-value dilemma by restricting its definition to EXCHANGEABLE commodities. But how does a product transition to the stage of becoming EXCHANGEABLE? It gets to that state when there is a BUYER with WANTS and PREFERENCES. A key insight is that “preferences” are ignorant of the labor that went into a product. No doubt the laborer will go to great lengths to explain all of his hard work (his LABOR) that went into his product, but that doesn’t change the fact that buyer preferences are deaf to his pleading.
Sorry, but I disagree entirely with that.
OK.
What do you disagree with?
I’d like to eat, to be clothed, to have a roof over my head for myself and my family, and maybe watch a little football on Sunday afternoons from time to time. Wealth is required to satisfy those desires.
Other people’s desires may be slightly different once they get beyond the basic hierarchy-of-needs building blocks, but their needs will require wealth as well.
Are you defining the terms differently than I am?
This question actually should be: Why is the government giving this subsidization. The answer is in VarlosZ’s CCPA cite – it’s a political subsidy.
[snip]
Exactly. As someone who works in a corporation who has a sector completely devoted to biofuel research, I can absolutely guarantee you that we would not be in it if it weren’t for government subsidies, which minimize our company’s risk. How did we get this subsidy? Same as most, PAC money. It’s much easier to donate millions of dollars to get billions of dollars in subsidies.
Hence, the need (well, the industry’s need) for PACs.
The free market in a massively roundabout way, got a bunch of farmers to farm corn and not farm something else and create massive price distortion throughout the global marketplace. None of this was possible if it were not for the power of government intrusion in the market place and the fallible humans who make these decisions. Farm subsidies are a horrible thing (well, to poor countries and starving people), yet this thing exists because politicians want to remain elected. I won’t even mention the arguments that once these inventions reach large-scale production the technology then becomes cheap and affordable.
And what omniscient person can determine what human need is? Needs are defined what it takes to keep a human alive. Once you get past early-agrarian style living, politics and government intrusion become involved creating more problems than it solves.
Nothing that specifically requires someone in a position to appropriate the labor of others and sell it for personal profit.
Ruminator, you have an incomplete definition and a mistaken assumption at the heart of your argument:
- Value is not solely exchange value, but use value.
- The labor theory of value does not say “All labor creates value” but “All value is created by labor” - two entirely different things.
Since an omniscient person doesn’t actually exist, this is a nonsense question. Obviously, however, the whole of society can determine what human need is, and that is incompatible with the market (administered by a small portion of society as a whole in the interests of that selfsame portion) making such decisions.
Sweden has a black King?
Ah. Now we’re getting somewhere.
How does the ‘whole of society’ determine what an individual’s need is? How does that process happen?
And how is the market just some guys on Wall Street?
Rob
That would be something the whole of society needs to work out as they’re building socialism. Having blueprints laid out before that even happens assumes people are too stupid to take control of their own fates - something socialism rejects.
sweeteviljesus, they’re the ones at the controls.
Right. I think we’re done here.
I would describe free-market capitalism - hell, libertarianism - using the exact same words you just wrote above.
Oh, and mazinger, did the politicians decide to subsidize biofuel farming in a vacuum, with no outside influence? Of course not. The free market didn’t get subsidies in a roundabout way, they got it directly by buying influence in Washington.