"People don't go hungry in a capitalist economy"

Great Debates
#1

(I am putting this in General Questions since I don’t have a debate side to argue, and really just want to understand the theory.)

Last night’s Daily Show featured a pundit commenting on the fast food workers’ strike and demand for higher wages with the title comment. Show link and salon article follow. He seemed to be saying that without the minimum wage, the market would create jobs at low enough wages that anyone would be able to get a job (even the “mentally retarded”). But having a job at a low wage doesn’t equate to not going hungry, or not having your kids go hungry. The artificial minimum wage isn’t true capitalism and that’s why we have hunger?!?


#2

I don’t think any actual people have said that. “The Daily Show” doesn’t qualify as a “cite.”

#3

His point, if we are to be generous, is that there aren’t shortages of food in a capitalist country. I’m not sure that’s completely accurate either. (I assume some very poor and famine stricken countries are technically “capitalist.”) If there is sufficient food, people shouldn’t go hungry. But, he misses the point that people still do.

#4

It wasn’t a joke written for the show. “Financial investor and commentator” Peter Schiff said it in an interview on The Daily Show.

I’m not sure what the question is. The point of most of the interviews on The Daily Show (the ones by “correspondents”, not the ones Jon Stewart does with a guest in the studio) is to show an ignorant person being ignorant. Schiff said something stupid. That’s all there is to it. If you asked him to explain his reasoning he would just say more stupid things.

#5

Because they are poor and can’t afford the food, which is their fault for being unworthy. This is all beneath our consideration; let’s move on.

#6

From the Salon link:

This would seem to be a corrupted version of Amartya Sen’s observation that “No famine has ever taken place in the history of the world in a functioning democracy.” stated (and documented) in his 1981 book, Poverty and Famines : An Essay on Entitlements and Deprivation.

I would not be surprised if Schiff equates democracy and capitalism. I recall a trumpeting of similar ideas when Sen was awarded a Nobel Prize in 1998, and his statement regarding famines was widely re-printed.

Ironically, Sen’s economic theories are not antipathetic to socialism. His extracted quote is explicitly in reference to democracy as the form of government, regardless of the economic system in place. However, when the Nobel was announced and the quote was broadcast, there were a number of people who made an immediate association between the actual statement and a different claim for capitalism. It was never a confusion repeated by the majority of conservative voices, but was popular among some Right Wing pundits who insisted that socialism was antithetical to democracy. Schiff would appear to have placed himself among that particular group.

#7

I can’t think of a counter-example to Sen’s statement.

Ireland’s famine between 1845-52 seems a pretty conclusive counter to Schiff’s statement

#8

There can easily be a surplus of food but people without sufficient income to afford it. That would be the Malthus end-game. Fortunately, we keep dodging that bullit thanks to improvements in technology. As a pro-capitalist person I’d point out that advances in technology are fostered by capitalism. But I think I’d be a fool to state that capitalism guarantees everyone (or even every able-bodied and willing adult) a living wage.

Good post; thanks.

#9

Well, I thought it was stupid too since presumably the United States is capitalist and the United States has people going hungry. Just thought I would ask what the reasoning might be, stupid or not.

#10

And as I recall Professor Sen has been pretty upset about this common corruption of his observation. I’ve seen his work co-opted by libertarians, for example, as “proof” that government control of the economy is bad, as if Sen was arguing that a European socialist democracy was famine-prone while Somalia, which is nominally capitalist while in no way a functioning democracy, had nothing to fear.

#11

While there was plenty of food in Ireland, it wasn’t available to the people there – it was all being exported for sale. Potatos were pretty much all that there was left for the Irish to eat, and when the crop failed, well, they were kind of screwed. And the laissez faire economic views of the time didn’t allow for much, if any, government intervention.

Also, Ireland wasn’t exactly a democracy, let alone a functioning one.

#12

I haven’t read the book or even any summary of the idea, but at first glance this sounds like it’s quite likely a “No True Scotsman” kind of argument. Unless he defines ‘famine’ and ‘functioning democracy’ in some objectively measurable way, he can just wave away any counter-example by saying “that’s not really a famine” or “that wasn’t really a functioning democracy”.

I mean, it’s pretty easy to say that any society that lets large numbers of its members starve to death is clearly dysfunctional. Which would means Sen’s statement is just a tautology (or, if you prefer, an element of his definition of a functioning democracy).

Plus, many people today would have an intuitive definition of ‘democracy’ that would restrict it to basically modern times in the developed world. Yeah, not a lot of famines in rich modern countries, but that’s more evidence about what it means to be rich and modern than it is evidence about democracy.

Now, maybe he has in fact given enough rigorous objective definitions, and found enough different places and times to make a good test of his statement, but my guess this is one of those things (like the famous “No two countries with a MacDonalds have ever gone to war with each other”) that is only true until it isn’t.

#13

The first and obvious failure of that logic is… well, maybe even without minimum wage anyone can make enough money to eat. While freezing in the dark, of course.

It’s not rocket science, and I’ll skip the political jabs, to calculate that a full-time job at minimum wage CANNOT make enough money for a single person to live an acceptable functional life. The cost of food, rent, and miscellaneous like clothes and transportation, even at a subsistence level, is well beyond minimum wage in most urban centers. It’s compensated for by living in substandard housing, going hungry and not having children.

Add to this a lot of the people who are in thi situation are there because of problems. There are a number with physical problems, and others with character shortcomings that make it difficult for them to hold a job for any decent length of time.

Most modern democracies claim to have respect for dignity and human rights. This usually translates into welfare payments, unemployment pay etc. - so the poor do not have to starve under bridges or beg in the streets mainly to survive. Similarly, people tossed out of work because of the economy, should not after two decades of work suddenly have to sell all they have just to survive the next year or two.

As Gus G points out, the interview is about stupid people showcased to display their stupidity. The interviewee obviously seems to be of the belief - “I made it with a bit of work, obviously they can.” This ignores the issues of self-esteem, intelligence, education, and ability to stick to a task (ADHD), let alone basic mental health problems. In my experience, many of the minimum wage employees are either unqualified to do better, incapable of doing better, or in other circumstances that prevent success. Telling them “it’s all your fault if you don’t do better” (a) isn’t true and (b) not the best of motivation.

There’s nothing intrinsic about a democracy or a capitalist society that guarantees nobody starves. However, there are not really any purely captialist societies. The welfare state elements of most modern societies are what currently guarantee people are fed.

#14

Those who would make that argument wouldn’t call the US a sufficiently pure capitalistic economy, with all the government regulations and subsidies. As Quercus points out, it’s hard to tell where the truth ends and where the “no true Scotsman” fallacy begins here.

#15

Yes. I have great respect for the benefits of capitalism, but I’m dismayed by those who don’t recognize that one of the strengths of capitalism – that it can respond very quickly to shifts in the markets, due to changes in situation or new technology – exacerbates the problem of people suddenly being out of work, sometimes in large numbers. It behooves an ethical capitalist society to recognize this and had some way to compensate for it (for example, with unemployment insurance).

(Remind me to put this in my “Why I Am Not A Libertarian” essay, should I ever write it.)

#16

Which is why I said the Irish famine is a counter to Schiff, rather than Sen.

#17

It’s hard to actually starve in America.

I actually took a month to eat like someone on Food stamps. Besides that amount of $ (which is small, but enough to not starve), there was also free meals and food handouts in many locations. The local Cathedral gives out a food box monthly. Another Church had huge sacks of potatoes, onions and piles of day old bread from Trader Joes (bless ‘em). At one downtown park you could get TWO lunches every day. (note, I didn’t eat there, except once, after I told them what I was doing and they insisted I try some). Nor did I actually get Food stamps, I just limited my Food Budget to that amount.

Bland, yes. Boring- yes! And a lot of it needed to be cooked, so that’s hard when you’re homeless. But I was never hungry, in fact the opposite.

#18

My take on what Schiff was saying was that people would have more to eat (be less hungry) without food stamps which are socialistic. Without them your chance of being able to get food from charity would be much reduced. Food banks around here were stretched thin during the recession even with food stamps.

#19

I would agree with that. The UK in the 19th century was a pretty good example of a pure capitalist economy, with minimal government intervention. The food which Ireland was producing was shipped out of the island, instead of being used to feed the Irish, because the owners of the land could make more money by selling the food outside Ireland than they could by using it to relieve the famine. No gov’t intervention stopped them - it was a market-driven famine.

#20

Oh, I think charity would pick up some of the slack, but not even close to enough.