Spew All About Politics Here

[Dude_Doc]

And what if people want to trade? What if they want capitalism? Can YOU prove that people, past present and future, really hates capitalism and rejects it? Besides that, if capitalism is to be replaced by some communist society, then people must start to trust each other. It's like telling a stranger about all the security locks and etc in your house, all the passwords on the internet and etc. Honestly, I don't think people will start to trust each other in the next milleniums to come (I mean that every 6 billion peron on this planet trusts the other etc). People want to share. The world is built in a certain way, and for now, capitalism is what makes the world spin.

[Dante]

No, that's not true. Emprworm locked it himself. This is just a heated discussion.

Did he? Good grief...

Um, it occurs to me that the only perfect form of government is the one when most people are unhappy. They are opressed, miserable, and lead out their entire dull, dreary lives serving a cruel and vindictive master. The master is controlled by the nobility, and he's unhappy, the nobility are more or less happy, and at the top is one person. One person who is REALLY happy. And the army of course, that's how he/she stays in power, with a vast, happy, unstopable army to crush rebellion underfoot.

Now people wouldn't like this, but at least there'd be no wars, just minor slave revolts, over VERY quickly.

No war, no fights, no disagreement, because they CAN'T.

Democracy was a bad idea from the word 'fair.' And please nobody say that I wouldn't like it if I was a slave, I have no intention of ever bringing about such a government. My idea of the absolute epitome of ruling is the political system on Ix. The suboids don't disagree because they lack the intelligence, and house Vernius remains. A Technocratic, and Autocratic government.

There, now I've said it. That's what I'd like. Feel free to tear in apart, I'll read the replies sooner or later.

[nemafakei]

Bill Gates = 50 units

John has 10 units and bread

Fred has 20 units

Harry has 20 units

Fred goes up to John and buys a loaf of bread for 10u. He then sells it to Harry for 20u - despite the fact that the loss incurred by going up to each (costs of transport etc) was less than 1u.

This means that

John has 20 units

Fred has 30 units

Harry has 0 units, but he has some bread.

But anyway...

Closer to the mark is:

"Ok, fine. I go with this"

the 'this' was effectively that...

"All money you gain devalues the money of others"

Fred's workwas worth 1u. He did very little, but he managed to get a lot from it. John is tired from making the bread (which required about 10u to make), Harry is poor 0 units, with bread that cost 10u to make, 1u to get to him, but Fred has done almost nothing, and profited disproportionately - he has 30 units.

John has 20 - 10u (work making bread) = 10u

Fred has 30 - 1u(work) = 29u

Harry has 0u + 11u (bread) = 11u

That's the essence of it.

Fred is like a man on the stockmarket. All he does all day is trade in money, and a very few actual resources. He gives nothing to society, yet may profit hugely.

[emprworm]

Bill Gates = 50 units

John has 10 units and bread

Fred has 20 units

Harry has 20 units

Fred goes up to John and buys a loaf of bread for 10u. He then sells it to Harry for 20u - despite the fact that the loss incurred by going up to each (costs of transport etc) was less than 1u.

This means that

John has 20 units

Fred has 30 units

Harry has 0 units, but he has some bread.

In a free society, Nema, it is simple. harry doesn't like the idea of buying bread for 20u, so he makes his own bread.

In a socialist market, he would have no choice.

But thankfully, since Harry is in my economy, he has the freedom to do so.

[emprworm]

Capitalism Where Everyone Wins

I'm tired of the crap about how for every winner there is a loser. not so!!

Now, I'm not gonna pull an edric or earthnuker and just spew without backup of evidence, so I now present my evidence.

Enter stage 1- graph of the Dow Jones

As is plainly visible, anyone and everyone that puts money into the Dow Jones stocks, on average will be GAINING around 12% per year. No losers. When stock drops, you simply stay in, and in the end, YOU WIN. Everyone wins. No one loses. It is not a zero sum gain.

Enter stage 2- S&P 500

Again, all winners. Doesn't matter if you are rich or poor. You put money in, and if you have patience, you are gaining money out. In poverty? You still win. No one loses

Enter stage 3- basic capitalism

Town of Ashton

Assets = Trees, fruits, local fauna

Population = 5 People living in huts

Fred

Suzie

Jack

John

Stacy

Economy = Each person has 10 units, which represent buying power. Total units = 50

Scenario:

Jack is a skilled hunter and great cook. He prepares his food much better than anyone else. People love Jack's tasty meals. Everyone pays Jack 3 units to have him make their meals for the month. Jack agrees.

Fred builds himself a house because he is tired of living in huts. He gathers resoures for his house on his own.

Jack wants a house too. Jack gives Fred 10 units to build a house, which Fred agrees.

But Stacy also wants a house. Stacy doesn't have 10 units, so stacy asks Fred if he will build her a house for no units if she gathers the resources for him, so Fred can concentrate more on houses, to which Fred agrees.

While Fred and stacy works hard at making houses, John starts making carraiges which would greatly reduce the amount of time it takes to move resources.

Jack and Fred both really like having a carraige so they each buy one for 5 units.

As a result, Fred and Stacy can now make houses much faster with carriages, and Jack can hunt with more efficiency.

Now John, who just made 10 units decide he, too wants a house, so he buys one from Fred and stacy.

Suzie on the other hand decides she is going to make furniture for these houses. Now, everyone who wants a house definately wants furniture. So Fred buys furniture from Suzie for 4 units and so does John, Stacy, and Jack. Suzie works hard making furniture but she also knows that Stacy, who is helping Fred gather resources is a skilled laborer. So she hires Stacy and pays her 5 units if she will gather a cart full of wood. But she needs the cart first, so she pays John 5 units to make a cart.

Now Suzie, who has made enough units asks Fred to make a house too.

But when Fred starts making the House for suzie, stacy tells fred that her work for him is finished. But Fred really wants stacy to keep working, so he pays her another 5 units.

Now, when the next month comes, everyone except john and stacy decide to pay Jack another 3 units to make his delicious meals for them again for 3 units.

Suzie agrees at Fred's request to make an extra piece of furniture for his house, since Fred wants to be the most luxurious of all the citizens. He pays her 5 units.

The totals are now:

Fred: 15 units + HCFF

Suzie: 10 units + HF

Jack: 9 units + HCF

John: 8 units + HCF

Stacy: 8 units + HCF

H = House

C = Cart or Carriage

F = Furniture

It is clear that Fred is the wealthiest. His total assets = 40 units. But his wealth did not come at the expense of anyone. All people in the villiage are now worth more than what they started. The poorest person is Suzie who's net worth is 25 units. But even she made out double.

Result:

Total value of Ashton at Day 0 = 50 units

Total Value of Ashton at Completion = 149 Units

ANALYSIS:

The idea that capitalism is a zero sum gain is preposterous. It is NOT I repeat NOT necessary that there will always be a loser in a capitalistic economy. It is entirely mathematcially and rationally acceptable that all citizens can gain. There will be some richer than others, or course, but then envy and jealously are not honorable qualities for any citizen to have.

In my town of Ashton, the economy was 100% capitalistic. There was a rich person in the end. And there were no losers whatsoever. No one lost at all.

[Anathema]

In your town, Fred worked for his money- in wich case he earned it, I'll admit that.

But suppose Timmy enters the picture, and he starts a bank.

Fred deposits his 15 units at the bank and recieves 3 % interest on an annual basis.

Now Suzie needs money, let's say because she takes children and needs a bigger house. Therefore she needs 15 units, wich she loans at the bank- for 7 % interest on an annual basis.

See what happens? Fred doesn't need the 15 units and gives it to the bank for safe keeping and recieves a small interest. Suzie loans 15 units and pays a high interest. Timmy is getting rich for doing absolutely nothing.

Or suppose all the wild animals die, and the people need to rely on agriculture. Jack becomes farmer, and owns the only crop field. Now, the other people need to eat too, and suppose Jack makes this proposal:

you can work at my crop field, and I'll pay you. Then you can purchase crops from me.

However, the people are actually farming their own food, but because Jack owns the crops they have to pay for it. Jack gets rich for doing absolutely nothing.

[emprworm]

Suzie loans 15 units and pays a high interest. Timmy is getting rich for doing absolutely nothing.

credit does indeed have a way of financially enslaving someone doesn't it? Timmy does take a risk when he loans his money to someone. Suzie freely accepted the terms of the loan. It is illegal for Timmy to change the terms once accepted. I do not like credit that well. It causes too much debt. HOwever in a free society, you really cannot forbid it. Loans are not imposed on anyone. If someone wants to 'borrow' your money or property on agreement that they will pay it back and then some, you should be free to do that. Borrowing is integral with freedom. Example: I dont care to ever own a yacht. But if you manage to aquire one and i can have the luxury of taking your yacht out to sea for a couple days for minimal money, I will do it. I'd rather spend less and borrow yours then pay big bucks for something i wont use very often anyway. Borrowing is just fine, and I argue is necessary, for freedom. No one owns *everything* and those who own things that people want to borrow (including money) should not be forced to lend it out and get nothing in return. If the lender asks the borrower, "sure, i'll loan you this, but will you pay me a small fee?" and the borrower says "yes" then you have no crime.

A government should not forbid that. No way. It should REGULATE IT, I will agree to that point, but not forbid it.

[nemafakei]

"Capitalism Where Everyone Wins"

Lets's dispel this myth.

You seem to misunderstand what I'm saying. (NB: no possible evidence for this; economic axioms, not examples are what this represents)

"No losers. When stock drops, you simply stay in, and in the end, YOU WIN"

Ok, but what about the people who didn't put money into the stock market. The investors gained 12%, but *there was not a 12% increase in the world's production*.

But, if the investment did improve use of resources...

[emprworm]

Nema, your rebuttal, though interesting, is filled with theories. The further we move into the theoretical, the more foggy things become and the less ability you have to make factual statements. In my simple town of Ashton, I am able to show, without theory, and with simple fact, how a capitalist economy can lead to profits for everyone with no losses.

You rebut the stock markets investment

by saying it does not coincide with production. You just cannot say that. This is pure economic theory which cannot be proven since people have speculated for a hundred years. Production is measured in many ways. And whether or not it coincides with production, we can debate, but what you cannot dispute is that it coincides with wealth.

My point is proven: capitalism does not necessitate winners and losers. Of course, it does allow for such a thing, but it does not necessitate such a thing.

[nemafakei]

Input analysis:

Jack is paid 12 for cooking. Jack needs food also, so he extracts 15 food to work on. 15 work done.

Fred is paid 10 by Jack to make a house. He builds the house; Stacey gathers resources for him. 10 work done.

John makes carriages at 5 each; Jack and Fred pay 5 each for one. 10 work done.

Suzie is paid 4 * 4 for furniture. 16 work done.

John buys a house for 10. 10 work done.

Cart bought from John by Stacey. 5 work done.

Stacey gets some more wood. 5 work done.

Fred makes a house for Suzie. 10 work done.

Next month, Fred and suzie pay Jack 3 units for food. Jack needs food also. 9 work done.

Fred pays suzie for more furniture. 5 work done.

---

Somewhere along the line, gone unmentioned...

Fred makes his own house - 10 work done.

John makes himself a cart - 5 work done.

Suzie and stacie get furniture each - 8 work done.

15+10+10+16+10+5+5+9+5+10+5+8= 108 work done in total.

108 work has been done in Ashton. 99 (at best, someone's made a calculation error, I think) was the general profit.

So all you have proven is that, in a system whereby everyone is willing to co-operate, and all be productive (ie not exerting their capitalist 'right' not to be productive), what you put in is what you get out. This is not profit. It is stasis. Also, you're in trouble when you run out of wood.

If the work is shared equally (we cannot ascertain this or otherwise; work values were not given to specific jobs), then some people have gained more from the same amount of work than others. You have failed to prove that effort is always proportional to gain.

So some people have probably worked harder than they have gained from it. These are the losers.

eg. Suzie made 6 furniture at 4 units each. So she did 24 work. She started off with 10, got to 25, so profited by 15. That means she worked harder than she gained - in other words, she made a loss.

Happy?

[nemafakei]

"You rebut the stock markets investment by saying it does not coincide with production"

You honestly believe that investment is colinear with production?!

The reason it does not coincide with production is that money is taken out of the production company to pay not only the money back to the investors, but also 12% interest.

Plus, there are various holes through which money 'leaks' - corrupt businessmen, pocketing improvements (ie managers of companies doing well will give themselves a salary boost - whether or not they are personally working any harder). There is nothing that capitalism can do, really, to stop these leaks.

[emprworm]

work has been done in Ashton. 99 (at best, someone's made a calculation error, I think) was the general profit.

i may have mistakenly counted furniture as 5, when it should have been 4, but i dont feel like double checking :(

So all you have proven is that, in a system whereby everyone is willing to co-operate, and all be productive (ie not exerting their capitalist 'right' not to be productive),

All you have done here is explained that my example was a simple one, to which I already said it was. It is a very basic example of capitalistic principles which do not necessitate a loser. We may thus now add complexity to the situation.

what you put in is what you get out. This is not profit. It is stasis. Also, you're in trouble when you run out of wood.

There is no stasis at all! The economy grew by leaps and bounds. Let me ask you a question, Nema. What would have killed the economy? Doing nothing. When money does not change hands, there is no growth. The same 50 units changed hands over and over again, each time it changes hands, wealth grows. Assets increase. The key to the capitalistic economy is that money changes hands . But the key to money changing hands- ahH! now thats the big problem that no one can seem to nail down. Theories, theories, theories. My belief is that money changes hands under 3 conditions:

1) The people must have ownership of their money and property

2) The people are free,

3) There is incentive to spend

Fred wanted a luxurious house. he worked for that goal. The goal was attainable simply because it was allowable. Thus incentive of Fred enabled those around him to flourish even though Fred became the most wealthy.

Fred was making units selling houses. The others look at society and subjectively identified a need . They started producing things that Fred and Jack would need to enhance their lives (carts and furniture). Fred sees these things and realizes that having them would increase his production and his quality of life. Demand is created. Money changes hand. Wealth increases. Economy increases.

You see?

Too Add Complexity:

Enter Joanna. Joanna wants to be lazy. She lives in a hut, but decides she isnt going to do much work. Does a big troll (the government) come along and barge into Fred's house and take from him to 'redistribute' to Joanna?

No. Not in Ashton, anyway.

If the work is shared equally (we cannot ascertain this or otherwise; work values were not given to specific jobs), then some people have gained more from the same amount of work than others. You have failed to prove that effort is always proportional to gain.

So some people have probably worked harder than they have gained from it. These are the losers.

They are only losers if they have the human attributes of greed, envy and jealousy. If they see things for as they really are, they are not losers at all! They still take out more than what they put in. In Ashton, we will have education and an objective moral law, which will help people be more thankful for what they have instead of being greedy and/or spiteful over what someone else has.

eg. Suzie made 6 furniture at 4 units each. So she did 24 work. She started off with 10, got to 25, so profited by 15. That means she worked harder than she gained - in other words, she made a loss.

She did not! Have you forgotten that Suzie bought a cart? This increased her efficiency by tenfold. She probably, in the end, made 10 times what she would have made had there been no cart production. And you are assuming that the time of work it took her to make the furniture was equal to the time it took Fred to make a house. You assume a 1:1 unit to work ratio. That is socialism. That is not capitalism. The point being that Suzie subjectively felt that selling 4 units per piece of furniture would serve her well. The price was decided by her and not by the big bad Ahston G-troll. (government troll)

[nemafakei]

"The point being that Suzie subjectively felt that selling 4 units per piece of furniture would serve her well."

Thankyou. We've now entered into the argument of the profits - the real problem with capitalism.

Before I start, a note on the side...

"Does a big troll (the government) come along and barge into Fred's house and take from him to 'redistribute' to Joanna?"

Not in my system! Firstly because the government is not a big troll, but a rational delegation of the community, and secondly, because ist's a rational system to

Altough, perhaps in yours, Joanna might start building huge bonfires to keep her house warm, using up all the wood. What's to stop her? In anothersystem, the resouces could be approportioned, or its use specified by the community.

Ok...

"The same 50 units changed hands over and over again, each time it changes hands, wealth grows. Assets increase. The key to the capitalistic economy is that money changes hands"

That may be true, but what you get in is still what you get out - the same improvements could be done in any non-capitalist system, and especially in a system based on co-operation, rather than people's 'rights' not to.

"Money changes hand. Wealth increases. Economy increases.

You see?"

I see that this is indeed the case within a capitalist system, provided the flow of money is roughly circular. If it isn't, then it accumulates in one area, and we get problems when other areas have too little money to

But this means that for the system to work, no-one can be greedy, else they will keep all the money and/or waste it.

"They are only losers if they have the human attributes of greed, envy and jealousy. If they see things for as they really are, they are not losers at all! They still take out more than what they put in. In Ashton, we will have education and an objective moral law, which will help people be more thankful for what they have instead of being greedy and/or spiteful over what someone else has."

So instead they are thankful for what they have, and have no incentive to improve? Or do you teach them to work for each other? In which case, capitalism is obsolete, when you could have a system designed so that we could do that best!

The profit with a capitalists system is that it is incredibly vulnerable to greed. And, since greedy people exist, and are unlikely to simply stop, they continue to be greedy at the expense of others. Say, for example, Fred, as the only person who has the skill to build good houses, decided that he won't do it for less than 20 units, so that he can make a profit. Everyone really wants a house, so they must bow to Fred's 'right' to choose his price. (Or does the troll step in here? If so, where does he draw the line between profit and extortion? And how does it justify the existence of such a line?)

Education alone won't stop him being greedy, emprworm. We need regulations to stop Fred extorting money from the other villagers.

Let me also review a part of the stock markt conversation, using your own summation format...

Emprworm: These graps show that people investing in the stock market become rich, therefore the stock markets are good.

Nema Fakei: But in your example, you do not account for the fact that this wealth is in fact at the expense at others, since profit cannot just appear out of thin air. Moreover, we know that a certain amount of

Emprworm: Stop using theories, use facts!

My reply to thiss will now be:

Nema Fakei: I used your own facts, along with a few undeniable facts. The only theoreticals in it was the 5% figure, which could easily be replacd with the correct figure without having any effect on the validity of my argument. If you want more evidence, look at TNCs who make lots of profit exploiting third-world countries (NB: other threads where this has been mentioned).

What I really want you to explain is whay it is better for individuals to invest, and expect profit for themselves (and at the expense of others (either the workers get paid less, or customers pay more - for no good reason)), than for government to invest license to use resources - a more direct solution, and the government will not require profit for itself, but REAL gain for all. Please answer this first.

... you have realised, by now, that there is no tax in my system?

[emprworm]

i dont have time right now to respond to this whole post, but I like it. I only have 5 min right now, so I'll respond to this one segment:

the same improvements could be done in any non-capitalist system, and especially in a system based on co-operation, rather than people's 'rights' not to.

This is soooo misleading. The same improvements would most certainly NOT be made if people had no motivation. Cooperation alone does not necessarily promote incentive. Do you really think the best soccer player in the world would have even 1/1000th of his talent had he never had anyone to compete against?

think about that, then you will see that there are a myriad of societal conditions that would minimize improvements, if not halt them altogether.

[Anathema]

Emprworm, your Ashtown strikes me as being the ideal of capitalism- but how do you prevent it leads to social abuse and poverty?

[Edric O]

I want to thank Nema for taking over my argument so I can rest for a while. :)

Up to this point, I agree with all Nema's arguments. So I will let him do the talking. If he gets to an area where our opinions separate, I'll let you know.

But I want to specifically underline this one point:

No matter what you do, Emprworm, you cannot create something from nothing. Profit does not appear out of thin air. All your examples and arguments have only demonstrated how tight the grasp of entropy really is. Because this is what it all comes down to: ENTROPY. An isolated system can only decay, NOT develop. In the end, the source of all profit is input from outside the system. In our case, this input comes in the form of natural resources.

The second law of thermodynamics says your "everybody wins" capitalism is impossible.

The only way to ensure that "everybody wins" is by equal distribution of resources. Or to make things simpler, equal distribution of profit.

[nemafakei]

Indeed: we must learn that we cannot keep growing, keep consuming. There is a limit to the rate at which we can safely extract resources - and by taking out too much now, we endanget that limit. Capitalism where everyone takes as much as they can before

"The same improvements would most certainly NOT be made if people had no motivation"

Obviously.

Therefore, I designed a system which gives people motivation to work hard (else they don't get paid by the community!). They will also be motivated (initially to but a small extent, later, more, I hope) by the desire to help others.

As for competition, the competition is within yourself. You are competing against laziness.

[Anathema]

Yes- profit is the amount of advantage you manage to take from other peoples work. If you end up earning more cash then the other while doing the same amount of effort, you are the winner whereas the one who earns less will be the loser- wich doesn't mean they'll starve, but they don't have the same life standard as the rich dude.

Machines take a lot of work out of our hands- thus more production can be realised, and the masses become wealthier. It is possible to realise a decent life standard for everyone (not today, we can't realise the same wealth for third world countries in this system).

[nemafakei]

"we can't realise the same wealth for third world countries in this system"

Correct, because the 3rd world countries have not the necessary investment to make their own work easier - due to the greed of shareholders.

[Anathema]

But even if we would try to realise equal wealth, would it be feasonable? In all of history there has been a workers class, right now it's the third world citizens.

[nemafakei]

The poorer willbe the lazy, the rich will be the hard workers. This is the essential switch that needs to be made.

[Anathema]

That's the ideal of capitalism- but today the shrewd ones are the rich and the poorly educated are the poor.

[nemafakei]

Even though it may be part of the ideal of capitalism, capitalism as we know it is not the way to go about obtaining this ideal.

[Anathema]

Pretty much. In that way capitalism is a flawed system, since it never reaches its goal.

[Edric O]

Capitalism is a system that requires continuous (maybe even exponential?) growth in order to sustain itself. Emprworm, you say that competition drives us forward. It does, and then some. Competition throws us headfirst into the unknown. What we are doing now is RECKLESS advancement.