EPTThe Lie of Capitalism and Globalization - Page 6
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Mauzel
United States421 Posts
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Klockan3
Sweden2866 Posts
On January 28 2010 08:10 StorkHwaiting wrote: The point of a government is to better the lives of its citizens, not the world. Therefore, I have every right to be angry. But the thing is that stopping this procedure is politically not OK at all. Other countries would hate you for it and start embargo you. trust me that is the last thing you want, every country earns a lot on trade. Overprotecting your own businesses is in general seen as extremely rude, the world economy would break down instantly if every country started doing it, that would be the biggest economic crisis ever to have happened. | ||
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StRyKeR
United States1739 Posts
A good example of this is health care. There is no inter-state competition. The entire system is a huge moral hazard, a giant cesspool of inefficiency where there is a back-office insurance agent doing paperwork for every two doctors. Think about the zero dollars you pay going to the dentist and all of that free tooth goodies you get even though you don't need it. SOMEONE is paying for that, whether it's the pool of monthly health care fees or the government. Looking at it backwards, YOU are paying for everyone else's health care. The doctors answer to the insurance companies and not the consumer. What is a free market in which the vendor is not held accountable to the consumer? If you had to pay for all those unnecessary goodies, would you still take them? LASIK is currently not covered by many insurance companies. As a result, everywhere you'll see ads for "Get cheap LASIK for $xx.xx!" When there is healthy competition in which the consumer gets to choose what to pay for, not what the insurance companies choose to reimburse, prices go down and quality goes up. The terrible places go out of business and the good places compete with price, service, time, etc. Read a good article on health care: www.theatlantic.com/doc/200909/health-care/ | ||
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Mohdoo
United States15690 Posts
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StorkHwaiting
United States3465 Posts
On January 28 2010 08:14 Klockan3 wrote: But the thing is that stopping this procedure is politically not OK at all. Other countries would hate you for it and start embargo you. trust me that is the last thing you want, every country earns a lot on trade. Overprotecting your own businesses is in general seen as extremely rude, the world economy would break down instantly if every country started doing it, that would be the biggest economic crisis ever to have happened. ? Yes it is. Tariffs are part of doing business. Every country earns a lot of trade. That's why when you put an embargo on one product, they'll still keep selling you the other products, rather than throw a hissy fit and refuse to trade altogether. It's not seen as rude. I'm not sure why you're acting like global trade is some kind of friendly tea party. Countries routinely do currency dumping, goods dumping, protectionist policies, fixing currencies to lower rates for unfair advantages, subsidizing industries to out-compete others. Every country has protectionist policies and they started with even more of them before all of this globalization started. How exactly would the world economy break down instantly if countries had protectionist policies? There was a world economy during the Han Dynasty. You're telling me it's going to break down because a government starts acting in its own interests? Come on, dude. Realpolitik is the name of the game and everyone's known it for a long time. | ||
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firegawd
United States12 Posts
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yarders
United Kingdom194 Posts
In order to understand economics we must first understand human nature. 1. Humans are insecure 2. Humans are selfish actors 3. Humans seek to overcome their insecurities in one of two ways a) Gaining power and thereby control (dominant method) b) religion (submissive alternative) 4. Humans are born unequal Refuting Communism (I know you do not advocate it but I feel the need to refute it anyway) 1. Communism demands that everyone be equal, knowone may better themselves above anyone else. This goes against the natural instinct of all humans. This means ... a) Communism requires a huge amount of state control to work. (USSR, North Korea, Cuba, the Stasi etc.) b) economic markets are inefficient, people are disincentivised 2. Extreme central control results in horrendous living conditions and causes the communist state to fall apart. Why Capitalism is the best system we have. 1) It allows people to act as selfish actors in line with their nature 2) It allows us to make our own decisions and exercise a certain amount of freedom. 3) Markets are efficient and people are incentivised I'm afraid im to tired at the moment to go into any greater detail. The key point is that HUMANS ARE FUNDAMENTALLY FLAWED. Scholars seek a utopian system where everyone lives in perfect harmony. No such system can exist. This is not to say that regulation should not exist or is useless. It is merely to understand that it can only go so far in solving problems within the system. To the opening poster: You spent much of your post criticising but you offered little in the way of solutions. I would like to know exactly what you would like to see changed and how you suggest it should be done. I advocate you undertake a detailed study of world systems theory as I think you will find it in accordance with your views. http://en.wikipedia.org/wiki/World_systems_theory On a side note I believe that the growing inequality within the world cannot go on forever. There will undoubtably be a revolution in the future should we continue to follow this trend. | ||
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StorkHwaiting
United States3465 Posts
On January 28 2010 08:16 StRyKeR wrote: Many supposed "failures" of capitalism and the free-market are actually due to laws that stifle competition. In these cases, the failure is caused by a lack of a free-market. A good example of this is health care. There is no inter-state competition. The entire system is a huge moral hazard, a giant cesspool of inefficiency where there is a back-office insurance agent doing paperwork for every two doctors. Think about the zero dollars you pay going to the dentist and all of that free tooth goodies you get even though you don't need it. SOMEONE is paying for that, whether it's the pool of monthly health care fees or the government. Looking at it backwards, YOU are paying for everyone else's health care. The doctors answer to the insurance companies and not the consumer. What is a free market in which the vendor is not held accountable to the consumer? If you had to pay for all those unnecessary goodies, would you still take them? LASIK is currently not covered by many insurance companies. As a result, everywhere you'll see ads for "Get cheap LASIK for $xx.xx!" When there is healthy competition in which the consumer gets to choose what to pay for, not what the insurance companies choose to reimburse, prices go down and quality goes up. The terrible places go out of business and the good places compete with price, service, time, etc. Read a good article on health care: www.theatlantic.com/doc/200909/health-care/ Actually LASIK is probably not a good example. There are a lot of rather horrifying cases of cheap LASIK operations for real cheap, and it's some guy with a cheap laser doing a shoddy job on people's eyes. They end up with double vision, dry itchy eyes, and all kinds of other terrible issues caused by shoddy work that's not well supervised. On the other hand, health care is a totally broken industry. Mostly because of the ridiculous bottleneck in supply caused by an artificial limiter on the number of doctors. I don't recall ever going to the dentist for free though. I pay $180 every time I go in for a cleaning. | ||
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L
Canada4732 Posts
On January 28 2010 08:09 Klockan3 wrote: Controlled capitalism most of all produces economic growth, socialism produces equality. You can't make things equal without disrupting growth. Anyhow, the problems you see are that jobs moves overseas. But you know, that isn't a problem! Those overseas are much poorer than the middle class of America. And you are still getting it better by all of this, since you can now buy cheap quality goods from Asia. You couldn't do that before. The downside is that when fewer buys American goods you get less jobs. But really, what is happening is a great global equalisation, you guys had it way too good compared to the rest of the world and now capitalism is showering money over those countries getting things up to par. You are just angry because this isn't making things better for yourself in every conceivable way. You want to stay as one of the over consumers of the world with 90% of the world having it worse than you. No, see, its not about over consuming, its about actually producing in step with consumption. The last 3 decades have been an exercise in overconsumption. What's happening now isn't the great global equalization; the vast majority of the world's wealth is being taken up by fewer and fewer people who are living more and more opulent lifestyles, funded by you. | ||
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mahnini
United States6862 Posts
On January 28 2010 07:59 StorkHwaiting wrote: Structural unemployment has nothing to do with globalization? Hm, that's a new one. And I disagree that this has happened before. We have not had a precedent where a sector as huge as agriculture or manufacturing was rendered obsolete with no sustainable, value-added industry to replace it. A service based economy that relies on consumerism just doesn't work in my opinion. It doesn't benefit Main Street. Modern nations need to come up with a good solution to employing their less-skilled citizens. This is not like 5-8% of the population. It's a majority of the population that is increasingly losing their jobs without a sustainable industry to be employed in. When you take the military, agriculture, and manufacturing out of the equation as main sources of employment, as we are seeing machines take over these jobs more and more, it becomes a serious issue that modern capitalism needs to address. So far, the answer has been rampant consumerism so that people can be employed in retail or service sectors. My point the whole time has been that this is an unsustainable strategy, built on the backs of 3rd world labor (which will not be 3rd world forever), and leads to no real growth because all we've really built are shopping malls and overflowing landfills full of thrown away merchandise. Look at what's considered the modern day savior in economics right now. The world is hoping that China's citizens will rise up and create such a ridiculous amount of demand for products that it will pull the rest of the world out of the doldrums. What kind of exit strategy from recession is that? Let's hope China joins in on the rampant consumerism so we find more people willing to blow all their money on unneeded luxury goods and we can keep this ball rolling? I'm sorry but quality of life is not ipods, flat screens, and blackberries. Not when we're forced to work more hours, at more intellectually strenuous occupations, with higher stress levels, for less effective pay. That's not an increase in quality of life. it's too bad a majority of jobs in the last two decades or more have been in the service industry. this is not going to change, at least it will not revert back to industrial labor. as production techniques improve there will be less and less need for manual labor and this is the fulcrum of the issue, not globalization. your argument is based on the assumption that we are still an industrialized nation and that moving away from this will cause the financial collapse of the middle class which is simply not true. the world is hoping china creates demand because it is currently offsetting the balance of supply. if you have a country of however many hundreds of millions cranking out cheap products yet hardly have enough money to meet basic necessities much less purchase luxuries, you have a large imbalance of supply and demand. one of china's largest trading partner is the US and we are in a large trade deficit, ever wonder why? we are buying more from china than they are from us (among other countries). quality of life is luxuries. that is assuming that the population is intelligent enough to know that luxuries come after necessities. a broke janitor making minimum wage barely making ends meet should not be buying a flatscreen, etc. | ||
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Alethios
New Zealand2765 Posts
On January 28 2010 08:16 StRyKeR wrote: Many supposed "failures" of capitalism and the free-market are actually due to laws that stifle competition. In these cases, the failure is caused by a lack of a free-market. A good example of this is health care. There is no inter-state competition. The entire system is a huge moral hazard, a giant cesspool of inefficiency where there is a back-office insurance agent doing paperwork for every two doctors. Think about the zero dollars you pay going to the dentist and all of that free tooth goodies you get even though you don't need it. SOMEONE is paying for that, whether it's the pool of monthly health care fees or the government. Looking at it backwards, YOU are paying for everyone else's health care. The doctors answer to the insurance companies and not the consumer. What is a free market in which the vendor is not held accountable to the consumer? If you had to pay for all those unnecessary goodies, would you still take them? LASIK is currently not covered by many insurance companies. As a result, everywhere you'll see ads for "Get cheap LASIK for $xx.xx!" When there is healthy competition in which the consumer gets to choose what to pay for, not what the insurance companies choose to reimburse, prices go down and quality goes up. The terrible places go out of business and the good places compete with price, service, time, etc. Read a good article on health care: www.theatlantic.com/doc/200909/health-care/ You know your claim that "Many supposed "failures" of capitalism and the free-market are actually due to laws that stifle competition." has been tried before. By Pinochet's economic advisers for instance. What happened when all the competition stifling laws were removed? Inflation soared, the gap between the rich and poor grew, the middle class disappeared and people starved. | ||
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Creationism
China505 Posts
Part of key concept of globalization is not simply the "free trade" aspect of it that everyone thinks of when they think capitalism, but also the factor movement. It's not the idea that the Harvard student will compete directly with the Beijing University student, but rather they will pick up their comparable advantageous position and trade in this manner. The trade balance is an issue, but much of the ACTUAL problems with globalization is with factor movement (this concern many issues like developing countries, outsourcing, and wage balances) When developing countries catch up in terms of technological advancement, certain parts of the labor process are directed there because of the comparative advantage and thus better profits. The natural order is that the developing country will catch up eventually and therefore gain more wealth by taking up more skilled ends of the labor spectrum. That is how a country DEVELOPS. Take South Korea after the Korean War. Massive exports and specialization, with full government support of not only monopolies, but also streamline firms so that they can gain economies of scale easier and develop the infrastrure/technology they need. That is why South Korea got broadband when everyone was on Fisher Price modems. In the US, what has happened is not a complete breakdown of the system, but rather the savings rate has been so low. The deficit is not simply from the government spending money like guys use water at a wet-shirt contest in the playboy mansion, but also the amount of borrowing and spending that the people has done to bloat the money supply. The money supply is what all these businesses grow on. When it becomes bloated, you have a plethora of businesses and could run fine during the bloated years, but once there is a contraction or a liquidity shock, they have no choice other than merge or consolidate. I agree that the system needs to be regulated, but not in terms of trade and free market, but rather on the passage of information. The biggest challenge to capitalism, if you have taken ANY economics courses at all, is the lack of truthful information. (about the future, about the client, about the borrower, about the company) I mean not to totally antagonize the OP here, but the explanation in the post lacks some serious ground work. | ||
ondik
Czech Republic2908 Posts
It actually never stops to amaze that people who would never try to argue against science like biology or physics when they have NO FUCKING CLUE and basic theory knowledge, try to argue against economics. | ||
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Bill Murray
United States9292 Posts
then look at south korea one is communist one is capitalist | ||
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StorkHwaiting
United States3465 Posts
On January 28 2010 08:36 mahnini wrote: it's too bad a majority of jobs in the last two decades or more have been in the service industry. this is not going to change, at least it will not revert back to industrial labor. as production techniques improve there will be less and less need for manual labor and this is the fulcrum of the issue, not globalization. your argument is based on the assumption that we are still an industrialized nation and that moving away from this will cause the financial collapse of the middle class which is simply not true. the world is hoping china creates demand because it is currently offsetting the balance of supply. if you have a country of however many hundreds of millions cranking out cheap products yet hardly have enough money to meet basic necessities much less purchase luxuries, you have a large imbalance of supply and demand. one of china's largest trading partner is the US and we are in a large trade deficit, ever wonder why? we are buying more from china than they are from us (among other countries). quality of life is luxuries. that is assuming that the population is intelligent enough to know that luxuries come after necessities. a broke janitor making minimum wage barely making ends meet should not be buying a flatscreen, etc. You're right that the majority of jobs in the last two decades have been in the service industry. And that's exactly why we're seeing a massive spike in unemployment now. The lie was exposed. As soon as the overconsumption went down, all that supposed "growth" in jobs disappeared. It was driven by American consumption. That level of consumption has now been shown to be untenable. People were relying on bubbles to fund their lifestyles. Scooping equity out of their homes to buy shit they didn't need. Now everyone's cutting back and suddenly a generation of workers have no jobs. And there's no foreseeable way to create enough jobs to absorb the unemployment. It is a critical issue when a third of the country is underemployed. We are NOT an industrial country anymore. THe problem is we aren't anything now. I mean, what do we produce? Pharmaceuticals? Britney Spears? Video games? We're a country that creates some brilliant intellectual property, but that doesn't employ a nation. It is a serious issue, one that you will see grow worse over time as each generation enters the labor force and the percentage of them actually finding jobs decreases. | ||
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Boblion
France8043 Posts
On January 28 2010 08:42 ondik wrote: Oh god, this thread tilted me so much but when I read Boblion post from 06:48 I began to laugh out loud, seriously, that guy must be trolling? It actually never stops to amaze that people who would never try to argue against science like biology or physics when they have NO FUCKING CLUE and basic theory knowledge, try to argue against economics. I don't want to educate you but i will give you an advice: you should read some stuff about epistemology and you could start with Karl Popper. If you don't see the difference between Human science and Biology or Physics i can't help you =) Btw i'm also studying eco but people thinking they know the truth because they have an eco degree make me laugh. | ||
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yarders
United Kingdom194 Posts
On January 28 2010 08:42 ondik wrote: Oh god, this thread tilted me so much but when I read Boblion post from 06:48 I began to laugh out loud, seriously, that guy must be trolling? It actually never stops to amaze that people who would never try to argue against science like biology or physics when they have NO FUCKING CLUE and basic theory knowledge, try to argue against economics. Whilst I agree with you there is a big difference between hard sciences such as biology and physics and the a social science such as economics. | ||
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Alethios
New Zealand2765 Posts
On January 28 2010 08:46 StorkHwaiting wrote: You're right that the majority of jobs in the last two decades have been in the service industry. And that's exactly why we're seeing a massive spike in unemployment now. The lie was exposed. As soon as the overconsumption went down, all that supposed "growth" in jobs disappeared. It was driven by American consumption. That level of consumption has now been shown to be untenable. People were relying on bubbles to fund their lifestyles. Scooping equity out of their homes to buy shit they didn't need. Now everyone's cutting back and suddenly a generation of workers have no jobs. And there's no foreseeable way to create enough jobs to absorb the unemployment. It is a critical issue when a third of the country is underemployed. We are NOT an industrial country anymore. THe problem is we aren't anything now. I mean, what do we produce? Pharmaceuticals? Britney Spears? Video games? We're a country that creates some brilliant intellectual property, but that doesn't employ a nation. It is a serious issue, one that you will see grow worse over time as each generation enters the labor force and the percentage of them actually finding jobs decreases. Solution: Go to war again. Build tanks, friendly predator missiles and work for blackwater. EDIT: Well... that was Bush's solution anyway. | ||
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StorkHwaiting
United States3465 Posts
On January 28 2010 08:41 Creationism wrote: I wish Sarkozy would jus stop... like... living... Everytime I see him it makes a little more bitter inside. Part of key concept of globalization is not simply the "free trade" aspect of it that everyone thinks of when they think capitalism, but also the factor movement. It's not the idea that the Harvard student will compete directly with the Beijing University student, but rather they will pick up their comparable advantageous position and trade in this manner. The trade balance is an issue, but much of the ACTUAL problems with globalization is with factor movement (this concern many issues like developing countries, outsourcing, and wage balances) When developing countries catch up in terms of technological advancement, certain parts of the labor process are directed there because of the comparative advantage and thus better profits. The natural order is that the developing country will catch up eventually and therefore gain more wealth by taking up more skilled ends of the labor spectrum. That is how a country DEVELOPS. Take South Korea after the Korean War. Massive exports and specialization, with full government support of not only monopolies, but also streamline firms so that they can gain economies of scale easier and develop the infrastrure/technology they need. That is why South Korea got broadband when everyone was on Fisher Price modems. In the US, what has happened is not a complete breakdown of the system, but rather the savings rate has been so low. The deficit is not simply from the government spending money like guys use water at a wet-shirt contest in the playboy mansion, but also the amount of borrowing and spending that the people has done to bloat the money supply. The money supply is what all these businesses grow on. When it becomes bloated, you have a plethora of businesses and could run fine during the bloated years, but once there is a contraction or a liquidity shock, they have no choice other than merge or consolidate. I agree that the system needs to be regulated, but not in terms of trade and free market, but rather on the passage of information. The biggest challenge to capitalism, if you have taken ANY economics courses at all, is the lack of truthful information. (about the future, about the client, about the borrower, about the company) I mean not to totally antagonize the OP here, but the explanation in the post lacks some serious ground work. My problem with asymmetrical information is that a lot of people even with the info will not make a smart decision. You ever tried to walk into a Walmart and start telling people why the products in their cart are bad for them, are not worth the money, etc? How do you think that would turn out? I've insisted this repeatedly. The majority of humanity is not that clever. Giving them perfect info won't mean much when their intellect can't even compute the information. Asymmetrical info as a problem is one of those theories bandied about by academics, yet has very little application in the real world. The academics forget that the average person can be rather stupid. What is a serious problem for the middle-lower classes is not their access to information. Rather, it's the simple fact that they need jobs they are capable of working and need wages that can support a decent quality of life. And they need regulation by the government to guide them into doing things that are beneficial for themselves. Because, sorry, people are NOT perfectly rational beings. And while they are selfish, they do not always do what is in their best interests. Even if they have the information needed to make a correct decision in front of them. There are plenty of people who know getting a college degree is pretty important. They've got the info in their faces 24/7. They still drop out. I think most people know heroin and cocaine are bad drugs. People still shoot and snort. | ||
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Ricjames
Czech Republic1047 Posts
Small regional (czech) production company was bought 2 years ago by this big global company. That small company was doing good in our market and was sold with a huge profit for the owner. Now after 2 years the big company decided that they will close regional production in order to decrease cost and will be importing goods from our subsidiary from Slovakia. The same happened in Hungary and other European countries. So we stay in the local market, but the production line is not there anymore. We had a small manufactory here in czech but still about 80 people lost their job due to this purchase. When the company was small czech company, everyone was happy there and people had jobs. This case is describing very small number of people, but i think that this is going on in more places with a lot bigger number of people involved. We can't really do anything about this trend, but it is really taking job opportunity away from people. Sure this huge global company still providing many job opportunities around the world. Our company has about 300 000 employees, but still 80 people lost their job in my country. If you look at it, there are many cases like this in my country (small regional company sold > poeple losing job). Thanks to this, overall people in my country losing job opportunities and if that is the trend, it is not good at all. This case is not that hardcore as the clothing industry. Almost all clothing nowadays is made in poor countries. Yes it gives the job opportunity to people there but the wage is very minimum. So you have people in advanced countries losing jobs in exchange for people in poor countries get jobs that are minimum payed and are still poor. Outcome is more poor people around the world. This is one of the bad influences of globalization and capitalism. I am not against capitalism and free trade market, I just wanted to describe how it influences the world. It is still the way which gives people the most freedom than anything else. I would like to add that i am really curious how will people cope with the problem of increasing technology level. Today and in the future, there will be more and more machines, computers and robots doing people's work and less job opportunities due to both these trends i have described > more poor people again. Sure if you are smart and educated person, you will always find your place, but everyone can't be smart and educated and if everyone will be in the future, there won't be enough opportunities for everyone anyway......Under any circumstances the future is scary (i didn't mean to detrail this thread, but i was just writing and writing. Sorry about that) | ||
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