The dirty secret of capitalism -- and a new way forward | Nick Hanauer
Transcript.
In summary, the thesis is that neoliberal economic theory is objectively false, and that we can do better..
Neoliberal assumptions that are false:
- the market is an efficient equilibrium system
- the price of something is always equal to its value
- we are all perfectly selfish, perfectly rational and relentlessly self-maximizing.
What is true:
- human beings as highly cooperative, reciprocal and intuitively moral creatures
- cooperation and not selfishness that is the cause of our prosperity
- market capitalism is an evolutionary system in which prosperity emerges through a positive feedback loop between increasing amounts of innovation and increasing amounts of consumer demand.
What to do:
- First, successful economies are not jungles, they're gardens
- Second, inclusion creates economic growth
- Third, the purpose of the corporation is to improve the welfare of all stakeholders: customers, workers, community and shareholders alike.
- Fourth, greed is not good.
Yep.
Comments (94)
Awareness, connection and collaboration in the face of fear...
And which of the findings are new?
What the guy is talking about is basically a mixed economy. That's not a new idea.
At least it's a healthy start to admit things like the following:
...and that constraining comes through institutions, democratic regulation, legislation, property rights for all.
Add the fact that not everything can be solved by the market mechanism. Even the most devoted libertarian will somehow admit that defense of a country cannot be organized through the markets. Yet this "exception" is the black swan that simply tells us all swans aren't white.
I'd myself add the importance of income distribution, the fact that prosperity comes when employees, not just the shareholders, do get their share of the income. Hanauer refers to this in the following way:
More important would be to emphasize that workers get their share.
And finally, avoid the utter stupidity and destructiveness of socialism. Growth in the Global economy that has cut povetry down has happened when large countries like India and China have abandoned the most destructive socialist policies.
Indeed; 10:13:
So neither is your point.
All the good emoji! First things first... how to convince people that cooperation is not a commie plot?
Surely there is a need!
Institutions matter and market mechanism doesn't work without societal institutions, starting from things like nobody can put a gun to your head and then say that the "transaction" was voluntary. Besides, back then Historical institutionalism was the vogue in Economic History and I remember reading then for example Douglass North.
The problem is that we often take as an example a corrupt, inefficient kleptocracy and call it "the natural state of capitalism".
A great quote. Unfortunately neoliberalism may have had its own logic in paving the way for the move from human-scale economies to inhuman-scale ones. The shift from the "real world" economics of farms, factories and services to the new, more virtual seeming, world of finance economics. Naked global capital flows.
And so "gardening" might still be going on. But at that higher "Davos man" level and not at a human community level, or even at the competitive nation state level.
So going back to the past seems not an option. The world system has been financialised. It is a beast that must now find its next step up or simply collapse - the extinction event that would return any surviving humans to an old fashion community economics and actual gardening if lucky. :grin:
The nature of that next step is the interesting question. To side-step climate change extinction, it looks like we are relying on exponential technology. We have to get off fossil fuels and on to renewables, of course. In a general way, the virtual reality of global capital flows and national debts has to be reconnected to physical reality.
Neoliberalism operated by streamlining the economic realm so that capital was disconnected from the material world in the form of human labour, energy inputs, and most of all, the actual longterm costs of the environment as a sink for the entropic waste that physical effort must produce.
Freed of real world constraints, neoliberalism could run up a tab on this physical and social capital. That allowed the exponential creation of financial capital (in the form of credit. Ie: debt). But now physics is catching up on that streamlined fiction. The entropic sinks that it relies on - a degraded environment, a literally heating climate - are costs becoming due.
The only way out it would seem is technological utopianism - a reconnect of some kind where the physical and informational aspects of being a human organism, the evolving Noösphere, find a new functional balance.
This is the Singularity argument (of which I am always skeptical). But it is also quite exciting that there are now glimpses it could be an economic reality.
Kartik Garda at the ATOM - https://atom.singularity2050.com/ - gives a lucid account of how tech is on the cusp of becoming an unstoppable deflationary force. Tech will drive the cost of everything (even harnessing energy or growing food) down to practically free. Almost all jobs can be automated, creating unbounded growth in per capita labour productivity.
In this next phase of the economic system, the world can not only afford its MMT money printing and Universal Basic Income policies, Garda argues it is already having to pursue them to stave off the early stages of the coming great tech disruption.
The central banks can't generate even a flicker of inflation these days, despite throwing trillions of debt into the maw of the beast since the GFC. And the reason is that tech deflation - the way automation and AI makes all physical products cheaper - is already a counter-force flowing at several percent of the total economy. Garda argues money printing has to become exponential just for its inflationary pressure to balance the exponential rate of tech deflation. And - with the pandemic - that is why the central banks have felt so free to do just that. The money printer goes brrrrrr....
So yes. The existing system is broke. But it is no revelation that "free markets" always are part of something larger - a system of governance that encodes the current economic paradigm.
A market of some kind is still required. It is the intermediating mechanism between the global constraints that govern (the co-operating society) and the local individual action that makes room for the competition that defines us all as self-interested selves.
To be a "human" system, economics has to be aimed at maximising both our collective human identity and our own free expression of "being human" .... as currently defined in our ever-expanding developing human story. So a market - as a cohesive collective space populated by equally individuated actors - is always going to be the heart of the system.
But the question is always about what grand flows is the market equilibrating?
At base, it always has to be a balancing of energy expenditure and intellectual capital. The human adventure is about developing the savvy tricks - fire, tools, gardening, politics - that allow us to harness an ever increasing amount of the biosphere's physical capital.
For the longest time - see Smil's Energy and Civilisation - this was just whatever physical capital that the sun grew. Hunter-gatherer, then agriculturalist. And then came the sugar rush of discovering that fossil fuels could sustain an exponential economic paradigm based on machines (and environmental sinks).
The machine age - the industrial revolution - was pretty grim in many ways. Yet also liberating. There is always going to be good and bad. And overall the human lot became better. And while also unequal, an argument can be made that the inequality is merely a natural powerlaw expression of wealth distribution - what equality looks like in an exponentially growing system that, by statistical definition, has no mean.
The machine age was focused on labour and capital. All our views on left and right, capitalism vs socialism, are founded on the tension between the factory workers and the factory owners - a step up in abstraction from the previous tension of farm labourers and land owners.
The problem to solve was balancing lives at both scales. And post-WW2, this was somewhat sorted by the emergence of social democracies and corporate businesses. You had unions and welfare systems to build in protections for labour. You had "wrap around" corporate structures that were tied into a general notion of being "good citizens" - delivering a return on capital that recognised the need to balance the needs of shareholders and workers.
But capital - as its own abstracted flow - wanted to be liberated from this socialised/physicalised constraints. And so along came neoliberalism as a tool to break down all the accumulated publicly-owned stores of capital - the railways or telephone systems which had citizens as the shareholders - and put them on the market.
Financialisation could then take off as its own thing. It was a way to mine the world of its promised future growth by taking out leveraged derivative bets on tomorrow's income streams. And then eventually, just to mine the promises that fictional growth would surely occur.
We now have that broke system where the central banks - the Fed in particular - have in fact had to socialise the actual asset markets. There is no price discovery in the stock markets if their prices are simply reflecting the largesse of trillions in debt "stimulus" (nor price discovery in terms of the true value of the US dollar that still underpins the world financial system).
But the argument that is currently most believable to me - in this very shaky feeling time - is that we are never going to make a well-designed step backwards into any kind of Green utopianism. The gardening metaphor. That is impossible because thermodynamics is a ratchet - a flow that only has the one direction that spells "growth".
So we have to hope for Tech utopianism to be true as an alternative. And actually act on that expectation. As Garda and others (like Jeff Booth, who wrote The Price of Tomorrow) say, the field of economic punditry is obsessed by the problems of yesterday and not yet seeing the solutions of tomorrow. Someone has to be brave enough to understand what wants to happen as the next step of this story and push it through into the institutions of governance that thus frame the collective space that is the market.
It is a moment where we need revolutionary scale reforms to absorb the contrasting imbalances of unbridled debt creation and exponential (possibly) tech deflation. And of course, the cost of those ecological and environmental sinks have to be including in the grand accounting now. They must be monetised and be a factor in the newly-designed marketplace.
Just as it is to stop people from competing. Especially when money (resources) or women are involved. It's just human nature.
Two men work at a data processing firm. One makes his quotas and just kinda loafs around. The other goes above and beyond with his nose to the grind and makes every minute count. Who do you think would or should get promoted and how could that not potentially be the difference between the company reaching Fortune 500 status, ensuring all its employees are basically set for life and the company going bankrupt and having to lay off everyone?
If you had to have open heart surgery who would you want? The more experienced doctor or the less experienced one? Gotta throw 'em both into the gauntlet to find out who's best.
It is no surprise then that his “gardening” is to be delivered through the formal means of social control, enforced by the monopoly of violence, and not through voluntary cooperation. Thus he uses his vast wealth “to build narratives and to pass laws that will require all the other rich people to pay taxes and pay their workers better”, thereby increasing state power at the expense of private property and wealth.
Isn't 'state power' the only thing that protects people from corporations? Power has to be somewhere. Where do you want it to be?
Ahhh...unbridled capitalism is easier to argue against than you seem to suppose, Kev. Free Enterprise, which is subtly a different thing, is the thing that it is very hard to argue against.
Corporations do not possess the monopoly on violence because they are comprised of private individuals like ourselves. Because the state has the monopoly on violence it also has the monopoly on power. So what protects us from the state?
If you get rid of the consideration of capital, then you’re not even talking about capitalism anymore, but (probably) just about a free market, which is not the same thing. A free market where capital distribution is at most a negligible factor is market socialism, which is decidedly not capitalist.
Sheer number. Free press. Open society. Gunzz. Though I'm hesitant to admit, instant online communication and sharing.
Probably the most important fact being at the end of the day public servicemen and women are just people too.
$15 minimum wage and increasing taxation for some multi-millionaires and billionaires is exactly what Orwell was talking about, absolutely.
So-called "human nature" is culturally, linguistically constructed. There may have been a human nature when humans were pre-agriculturally, presymbolically and unreflectively alive to nature. From what I have seen the paleontological and anthropological evidence points to the predominance of cooperation and lack of hierarchy among gatherer hunter societies. The competition, the competitive "nature" (really culture) arises with the advent of property.
It seems almost certain that we would not collectively and voluntarily make such an attempt. However if the current system collapses humans may well return in small groups to a hunter gatherer life. Personally I would much prefer to see that than your "pie-in-the-sky" techno-monstrosity future. Luckily I don't think there are sufficient resources to bring that about anyway. Only time will tell.
Say I need a cave to sleep in so I don't get soaked and can have a fire that lasts during a storm so I don't succumb to exposure or hypothermia.
My cave family or whatever have lived there for a generation or two now. We have very epic cave paintings we all enjoy on the walls.
If I don't "own it" what's to stop someone else or rather many persons from entering it and perhaps they don't quite know all we do about fires and dangerous plants or just otherwise bring some contagion in perhaps one we happen to be allergic to. Or decide to draw all over our epic cave paintings.
That'd be annoying if not fatal for one of us. What solutions would you propose that would be mutually-accepted? Again, if there's more people who want to do whatever they want in the cave we've lived in for generations, a "democratic" vote obviously screws me over.
Come up with an answer and please write it out before you unhide the following statement. No peeking.
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I SAID NO PEEKING.
[hide]Now read it all again but instead of "I" imagine it says "you".[/hide]
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So it certainly isn't "my" dream as such. But - for my own sanity - there has to be a reason why the Green movement has been such a consistent failure ever since I was first on board with its ideals in the 1970s.
If nature is in fact an entropic system, then what is the right moral position to take here? Is finding a way for a global population of 9 billion to kick on in the same basic economic fashion a "monstrous" outcome.
If so then nature itself is the monstrous thing. Us old school greenies are caught in the paradox of seeing nature as monstrous. And what is revealed is we had some misunderstanding of nature as a secret garden spoilt by too many of the wrong sort of humans.
I've cited before Vaclav Smil's excellent book, Harvesting the Biosphere.
As a population of currently 7 billion humans now, we harvest about a quarter of all terrestrial plant growth to support ourselves. A third of the earth's ice-free surface has been taken over by agriculture.
So the earth is mostly constituted of domesticated anthropomass - people, cows, sheep, goats and pigs. The quantity of this anthropomass has increased from 0.1% 10,000 years ago, to 10% at the start of the industrial revolution, to 97% today.
The total weight of human flesh is now 10 times that of all wild mammals - that's everything from wombats to wildebeest. And our domestic livestock, our mobile meals, then outweighs that true wildlife by 24:1.
Read the figures and weep if you are a greenie. How could you wind the world back from that in any voluntary fashion?
One can only look forward. The ecosphere is well past the point of no return in being remade in the domesticated (and gardened) human image. We have to accept that trajectory and lean into it to have any chance of avoiding a catastrophic collapse in the next 20 to 100 years.
So what does that future look like - when the earth is even more thoroughly anthropomorphised?
It is going to have to be a world saturated by machine intelligence ... in a way that counteracts our current era of machine dumbness. We've had the fossil fuel Industrial Revolution. We've started the Information Age revolution but are caught between stools as we are still reliant on fossil fuels and it feels like too big a leap to get to renewables.
But as I say, the good news would be if the techno-optimists are right and tech is exponential. An economic rebalancing would become possible if we can return to a hunter-gather situation of living within the energy provided by the daily solar flux, and yet do that with a planet that is some kind of Borg colony of 9 billion and still growing individuals.
A monstrous future or logical destiny of nature itself?
Economics just makes a good lens for examining the realities at play. The moralities of yesteryear are no great guide once the future starts coming at you with exponential speed. Which really started to happen once humans stumbled on the motherlode of fossil fuel (trapped ancient sunlight) and the machines that could release its immense power.
If only it were just my own. You feed a cat or dog wet food they often won't easily go back to dry. Unless they're starving of course. Folks are the same way. And just like animals, they will fight and kill (or at least vote, heh) for whatever they perceive will ensure the continuance of life in the manner of which they've become accustomed. If I double your salary or income today, you would become accustomed to it. And if you found out there's something or someone that may force me to have to return it to what it was... you'd get to thinking. We'll leave it at that.
Sure, social animals cooperate with each other and don't go around murdering one another. They prey on smaller animals. Which is exactly my point. If the irrational (or even rational provided they convince themselves they'll have a guaranteed position of leadership) convince the rational (or anyone) to "follow their mindset/vision/belief" (religion) then those against it could become the minority and are now subject to predation. Fortunately these days that just means being outvoted. lol (usually)
As to the idea that tech could be "exponential" sources of energy will still be required, and on such a scale I can't see what they could be other than fossil fuels. But production of fossil fuels has apparently peaked, apart from the new productions from fracking, and in relation to the latter, it's arguable that they are not economically viable, and only continue on the back of funds form starry-eyed investors (who by all accounts are dwindling) and government subsidy.
Then there is the EROEI equation to take into account. Money aside, if comes to the point where it takes more than a barrel of oil to get a barrel of oil out of the ground then it's not worth it, and we are will be in a downward spiral of diminishing prosperity that would ring the death-knell to the current growth economy. I think that, or something like that is going to happen, unfortunately for humanity. And I hadn't even mentioned global warming!
I see cascading collapses of the current system over some timeframe (who knows how long, but probably less than a century?) Unless we go for nuclear (which has its own suite of problems) or discover workable fusion. But still if the population is something like 9 billion, then industrial agriculture must continue to grow, destroy soils, deplete water sources, pollute the oceans, extinguish habitats and ever more species, and so on. Personally I would rather see a drastic reduction of population; but what will be will be, and there's really nothing I can do about it.
Thanks for the book reference; I'll check it out...and good to see you back!
I think exploitation, and even persecution, of minorities is inevitable under the current system, because there isn't perceived to be enough to go around. I have read an estimate that the Earth could support no more than 200 million people by sustainable organic framing practices. The problem is that it seems impossible that there could be a globally coordinated, cooperative effort to lower the population to that number and sustain a stable non-growth economy.
I think the old chestnut "money is the root of all evil" is close to the mark. With settled agriculture comes property, and from there capital and capitalism seem inevitable.
However now it feels more like a genuine two-horse race. Techno-utopianism could pull off its last minute Gaian twist of a self-organising step to the next "economic" equilibrium state.
Probably not. But the game has got interesting again.
I agree; I am by no means certain about how things will unfold either. I don't privilege humans over all the other species, though; and I'd rather see humanity descend back into small groups of hunter gatherers than a highly populated mega-tech future where the wild is irrevocably lost. Call me inhumane, but that's just my preference which means but little in the scheme of things. :smile:
I can see that there is the view that life is sacred in some (spiritual) sense. So if you believe in that kind of ontology, what you say is consistent with such a backdrop presumption. All life is equal (and the Comos needs to be "alive" too, otherwise its existential meaningless becomes monstrous).
But I am coming from another direction in terms of my backdrop ontology. If I treat reality as a dissipative structure, then that involves the balance of "intelligent" organisation (negentropic structure) and its necessary other in the form of entropy production (or waste heat).
It is a clash of paradigms as usual.
But the probable end of human civilisation while my own children are still growing up gives this debate a certain zing. :gasp:
Well rest assured both religion, science, and history reach a single conclusion that cannot be avoided. The planet, society, or "the world" can end in a moment's notice. All three state this as fact. Religion via God, science via a multitude of ways (climate change, gamma ray bursts, death of the Sun, too many to name really), and history in obvious ways such as politics, war, invasion, plague, etc.
Probably seems more doom and gloom than I claim to try and be but, none of it's happened yet! One could even say it's unlikely. Point being it shouldn't be "this debate" that suddenly gives what was always possible a "zing", though it may bring things from the back of the burner for a few minutes. Be prepared. I guess enough to be confident you have no reason to live in fear (or to be fair less reason than the next guy) as a result. Ignorance is bliss I suppose. But you wouldn't be here if that was your style.
Should I say this? I find it quite exciting to be alive at this freakishly balanced moment in creation where we can both look back to see how the whole cosmic shebang originated and how our own part in its journey its going to pan out.
I should still be around in 2050 (just) when all the critical trend lines intersect. If you ever wanted to pick a time in the past million years, now is good in terms of what we will make of ourselves.
That privileging seems to be a "natural" outcome of symbolic culture; that coupled with the fact that all social species seem to cleave to their own. But then it is the symbolically mediated intelligence that makes it possible that we might transcend that instinctive "own cleaving".
But in regard to my preference I'm also motivated by what I think would be the richest kind of future for humanity as a whole. I just can't imagine humans being satisfied with a life devoid of the wild, all I see there is a profound alienation. I'm not motivated by any thought of transcendent spirituality; I think that is something we cannot have sensible opinions about, so it's down to this earthly life as far as I am concerned.
Quoting apokrisis
I consider myself lucky in never having, or wanting to have, children; but I have good friends who do and I can empathize with their concern (and yours).
Eh I'd wager they say that every millennia. :grin:
Weren't you of the opinion before that mind was a biological phenomenon? I recall in one thread you gave reasons for it citing some bio-physics.
I fixed that for you.
You can't distribute capital if you don't differentiate between capital and property.
Capital is a kind of property, in any case, and the only kind that really matters for macroeconomic purposes. Nobody cares about the distribution of toothbrushes or toys. It's the distribution of the things needed to live and work -- that's what capital is -- that matters. The distribution of the rest of it can sort itself out easily enough so long as everyone has access to the things they need to live and work.
Howard Bloom reached a similar conclusion in his 2010 book, The Genius Of The Beast : A Radical Re-Vision of Capitalism. In contrast to pure Capitalism, he refers to an impure mixed economy as the "Western System". :smile:
Labour costs I think are in the category of expenses and costs.
And if the company posts losses should the workers forfeit their pay?
We should note that “Capitalism” was initially a snarl word used by socialists to disparage a sort of bogeyman. So I think a name change would be appropriate.
I wish I could agree with this. But then I look at today's headlines (or any history book for that matter) and find overwhelming evidence that this is not so.
Quoting BitconnectCarlos
Bankruptcy laws and procedures are a result of a long historical learning, just as is limited liability.
In Antiquity there wasn't limited liability, hence if you couldn't pay up to your financiers, they literally owned you. Hence the risk of possible slavery didn't incite people to invest. This of course was a problem in a time when shipping was a hazardous enterprise, so it's no wonder that the commenda, a passive partner, who's risk was limited emerged in 11th century Italy.
When you get fired your compensation stops. Sure, that sucks but you're not actually in the hole for anything. An example of employees having a direct stake in the company would be stock options: When times are good portfolios grow, but when times are bad that portfolio doesn't just pause - it hemorrhages money.
But people now talk of the Singularity in terms of its more modest promise of exponential tech trends driving the cost of everything to zero. So it is AI as we know it - Siri and Alexa. Aids to life. The kind of useful singularity that is now preached by the Singularity University.
This seems a linchpin to your theory, and it's false at least in numbers high enough to matter. If it were true, the economic or political theory we chose would hardly matter.
If we assume that people are highly self interested, first to their families and then to those most similar to themselves, we end up with something like we have now.
Wasn't this Kurzweil's original argument? His law of accelerating returns which was a counter to the standard law of diminishing returns.
Quoting apokrisis
Would this not require a fully functioning mind though? If cost is down to zero for everything then what would be left of a human mind? Fwiw, the writer of the link you provided seems to agree with Kurzweil that a singularity will result.
Quoting ssu
I'd be interested in learning more about bankruptcy laws.
With Benkei, I was more responding to his idea that the employee ought to have more of share in the profit of their business. I was just saying this is all fine and good until the company finds itself in the red and instead of profit to be shared it's debt to be carried.
Human society is based on the dynamic of global co-operation in interaction with local competition. The two are a mutually reinforcing deal. They go together by necessity. And good economic or political theory gets that.
We have to cooperate to form the marketplaces we then compete in. There have to be collective protections for property rights for individuals to compete over those rights, for instance.
So the mistake is to try to build a theory around just one side of the dichotomy. The goal would be to design a system which maximises the expression of both - both the cooperation and the competition.
As humans, we are nicely evolved to flip between aggressive and empathetic behaviour. We are neurally equipped for the dynamic that has always been the driver of our complex sociality.
I wanted to say something like this, minus the name change. Socialists are the ones who define certain types of property as capital because it gives them one more reason to believe people with wealth did not earn it. It was the "capital."
Anything can be capital, and all capital can cease to be capital. One of Rothbard's examples was a chair in a hotel; if it were in your home it wouldn't be capital. Except now that you can rent your home out with Airbnb.
Are there degrees of capital? If some capital is 10x as productive as some other capital, is the former controlled 10x more by the state? Do see how arbitrary this is?
Who said anything about the state?
Socialism isn't all state socialism.
This is an interesting way of putting it. I think I agree. I think cooperation often comes down to rational self-interest, and actors within a free market can make use of this very nicely. If you can produce something well and I can move and sell that product well then we can cooperate. Cooperation is just generally a good thing, I just wonder if the notion of cooperation is inherently limited to an in-group.
Even as someone who considers himself a free market capitalism, I still regard competition with a little hesitation. Competition can get out of hand quickly, and it's often just an unfortunate reality thrown upon humanity by nature (for instance, with dating/marriage/social status) or over scarce resources, especially in the past where there often wasn't enough to go around. In business competition can turn bloody or leave some business owners broke, but it's ultimately better for the consumer to have options and not be at the mercy of one supply chain. I wouldn't call it a "necessary evil" but it is something to be careful of.
Oh, you're a socialist.
Statism-libertarianism and capitalism-socialism are nominally orthogonal axes, and if they do correlate, it's along the lines of libertarian socialism (the original left, the original kind of libertarianism and the original kind of socialism) vs state capitalism (the original right).
If a system - such as a social system - is working properly, then competition~cooperation is a dynamic that will be in full effect over all its scales of operation. This would be a measurable prediction of a systems model of the situation. (See Adrian Bejan's constructal theory approach to social economics for instance.)
So "in-grouping" would be found on every scale. The smallest in-group would be just you. You would say to your left and right hand, don't squabble guys. Let's all be friends and work towards the greater good. Dr Strangelove ring a bell? :wink:
Then your family or friends or sports team are larger scale ingroups. The sports league you play in is full of rival in-groups that can have useful fun only because the teams all accept a shared framework of rules.
Nations are in-groups, religions are in-groups, the United Nations is an in-group.
So cooperation defines the general framework that constitutes an in-group as even a thing. And by the same token, defines what is legitimate in terms of displaying some competitive fire within that generally agreed set-up.
That was what democracy was all about. Paving the ground for a scale-free expression of interest groups - the basic unit of society according to a classic like Arthur Bentley’s The Process of Goverment: A Study of Social Pressures, 1908.
Communism and Fascism fail - when in competition with better balanced democratic politics - because they don't implement the basic social dynamic, except sometimes weakly and accidentally.
Quoting BitconnectCarlos
But is that a result of experiencing the US system which leans too far in that direction? Or a reflection of how neoliberalism as a philosophy has tried to take the whole globalised financial system in that direction?
Sure, what should be balanced can also be unbalanced.
But we should celebrate competition - in its most creative sense - as much as we would celebrate cooperation (which can lean just as far in the direction of unnecessarily stultifying regementation without competition to balance its constraining tendencies).
The same debate lies behind Darwinian evolution.
Victorian Britain felt that the emphasis on "red in tooth and claw" competition in evolutionary theory was a justification for the very unequal capitalist empire it was running at the time. And since then, any biologist understands that nature only thrives because evolution is actually about an ecosystem of "interest groups". There is plenty of cooperation going on once you start looking for it.
I don't mean to ignore the first part of your response - it's just we're mostly in agreement.
Quoting apokrisis
I don't think my ambivalence towards competition comes from either of these. For the record, I'm fine with local sports leagues and chess tournaments... sure emotions can fly but all in all these are relatively low stakes competitions.
Competition pervades society though - and this isn't just about American capitalism. Soviet school children still sought to achieve the highest marks and go to the best universities. Native Americans in pre-agrarian societies still sought to become chief and attain a healthy social status (often through war.) Whether it's social status or business/wealth or romance competition is pervasive in human affairs and the losers suffer real, serious consequences. Life is often a high stakes competition.
The losers don't necessarily deserve it, either. There's an element of randomness to it. I understand the systemic benefits and the fact that competition can make men stronger and more skillful in areas, but I can't ignore the costs either. I think there's an element of tragedy to it that cooperation doesn't quite have.
Yes, there is always pain and pleasure. But the cooperative end of the spectrum is also experienced in these terms.
Who enjoys feeling constrained and having to play by the rules? Who loves paying their taxes - until they need a hospital? Who in their right mind would want to be in the army - until it is in defence of their home town?
So living has real consequences - pleasant and unpleasant. But competition and cooperation deliver both in their own ways.
Balance would be then whatever could be a happy medium that achieves the most overall good - however we then decide to measure that.
Quoting BitconnectCarlos
But how much is this a modern cultural mythology - the image of the striving hero battling against fickle fate? You don't have to go far to see counter-stories where the tragedy is to be cast out of the collective bosom.
So we can play this both ways - a sign that this dynamic truly exists as a mirror reflection of its own self.
Only a socialist talks about force and claims it isn't force. It's a matriarchal condition, like, "Do what I say, but tell me you like it."
I think we were thinking about cooperation in different senses. Neither of us is wrong here - the word can be used in a few different ways. Usually when I think about cooperation it's, for instance, a group of people working towards a common end, mutually beneficial, through their own free volition. It's not about following rules that you never explicitly agreed to or being forced to do something. We see this all the time in a free market where people's interests and skills can line up in ways that benefit both parties.
I understand where you're coming from though. People will often say "I expect your cooperation" when they really mean "Please do as I say." There can even be a real threat behind it if you don't yield. In this sense of the word, it can certainly be stifling and I agree with you 100%. I like to distinguish between cooperation and coercion.
Just to clarify, for "tragedy" I meant it more in the literary sense. I don't consider this modern - you have Shakespearian tragedies and there's a long literary tradition of good, well meaning characters who get brought down through something unfortunate.
I think if I were to accept this notion - that the best always prevails - I'd probably find myself believing in some sort of version of Social Darwinism like the one you mentioned earlier in Victorian England.
It’s more along the lines of De Tocqueville’s “soft despotism”. You can look to the state to demand of others what you yourself refuse to do, but in so doing you grow state power at the expense of your own.
http://xroads.virginia.edu/~Hyper/DETOC/ch4_06.htm
Nosferatu : What would you call this new kind of economics --- The Golden Rule? :joke:
If the idea you’re talking about is just non-coercive
trade, that already has a name: a free market. Which isn’t the same thing as capitalism. If you’re not in favor of wealth concentrating in the hands of fewer and fewer people, then you’re against capitalism (even if you’re still in favor of a free market), and shouldn’t mind that word being snarled at that bad thing you’re against.
With those concepts separate then maybe you can brainstorm some ideas on how to keep wealth from concentrating like that without sacrificing the free market. And libertarian socialists around the world
will join you in that.
The person in your first link placed it in the 2060s. Singularity is only the law of Accelerating returns. Like when you efficient technology you then had oil and then electricity and so forth. If you have driven the cost of everything to zero. Then you only need to figure out a way to knit things together using existing techniques you learned getting to that point.
Out of curiosity have you seen https://play.aidungeon.io/ ?
I don’t think wealth can necessarily concentrate in the hands of a few because wealth is not a zero sum game. For instance when I make a dollar you do not lose a dollar, my gain is not your loss. So I cannot agree with that assessment of capitalism.
I don't necessarily have to lose a dollar for you to gain a dollar, but it is still possible that you can gain a dollar at my expense.
And if everything was truly voluntary and uncoerced, surely people would only go in for trades where each side gains something, so you wouldn't end up with some people getting richer and richer while others get (or stay) poor. The rising tide would float all boats.
If you think that everyone is getting richer together, well then you're just factually wrong, and I'll let others deal with that because it's not worth my time to argue about well-known and easily-googled facts.
I don’t see how any of that is the case. The rising tide is raising all boats, for instance with the decline in global extreme poverty and the rise in life expectancy. One of the richest men of all time, Nathan Rothschild, died of septicaemia even after buying the best healthcare in the world. Nowadays anyone can be cured of it.
No I don’t think everyone is getting wealthy together, just that wealth expands, and it becomes more and more accessible to everyone.
Yet the basic fact is that wealth is created. If you produce something of value, then the World is that product richer as it was earlier. If you sell it and someone buys it, notice that the amount of money stays the same, but that product is more than before.
Just as NOS4A2 above mentions that the richest man in the World couldn't get earlier services like medical treatment that is rather cheap now. If we'd be living in the 19th Century, I'd be already dead. The fact that wealth isn't distributed equally is another issue.
Not my theory; but I will stand by it. As I said the @Issac,
Quoting Banno
Don't drag me into this. Your misrepresentation of my position is bad enough on its own without implicating it in something even less related.
As long as humans are imperfect, there won't be a perfect system. Attempts at creating one are likely to produce an outcome worse than the original, not in the least because those who strive for change often lack any insight into their own human (and thus flawed) motivations. Be very wary of those who see no issue in forcing people to part with their wealth in search of a 'perfect' system'. It's indicative of the totalitarian mindset, and sadly it is well-represented here. On a philosophy forum, paradoxically(?). I guess that can be attributed to the arrogance of intellect, even though any real intellect seems to be lacking.
And so is to believe that 200 years old leftist economics that has been tried for the last 200 years and has utterly failed is an answer to the problems of the present.
There's no paradox, Tzeentch. This has been the normal for a long time, it's just pops up from time to time to be observable.
Many philosophers are idealists and believe that the only answer to present problems is a radical depart from the norm, from what we have now, and believe in radical change of the society and it's institutions as the only answer. Hence in a liberal democracy, the other seems interesting. They fall in love with the ideology, be it whatever it is as just what is the cool ideology changes.
Just look at the stock market. :yikes:
Thanks for summarizing the video.
For me, the key is that markets are not efficient equilibrium systems - roughly, that monetarism sits on a false assumption. Economic growth comes from innovation and increased complexity, not the quantity of money.
Yes, but we have instead a boom and bust economy. Economic cycle is best when it's tightened and then relaxed, tightened then relaxed, not feast or famine, where many would lose their livelihood and commodity in the form of time gained through savings (time is money), and therefore lose faith in the system.
But the cycle was used - cynically - to pump money in one direction.
Ah. I'm sort of mentally fumbling on this as I'm not sure whether we are confusing cause with effect here.
I believe the issue we want to deal with is that the boom and bust is the result of a faulty economic system -- inequity or not. (Just for good measure, there would still be times when tightening is needed even in the most equitable economy.)
And how do we define equity? Unequal income is not necessarily a sign of inequity.
Have a flick through this...
Well, I'm puzzled, too. Suppose the the market is not in a state of equilibrium, but has been treated as if it were... would the resulting instability look like a series of booms, followed by busts?
"The World Social Report 2020: Inequality in a rapidly changing world comes as we
confront the harsh realities of a deeply unequal global landscape. In North and South
alike, mass protests have flared up, fueled by a combination of economic woes,
growing inequalities and job insecurity. Income disparities and a lack of opportunities
are creating a vicious cycle of inequality, frustration and discontent across generations."
Okay, these are effects. No contradiction to what we're discussing here.
Quoting Banno
What? First, how does one fake this kind of ginormous interconnection of markets and populations?
Second, say we could fake it, then the series of booms -- why then would we allow a series of busts? I'm just saying... if we could fake something this enormous.
What? I wasn't suggesting a conspiracy...
While this is not what I was thinking, the power of suggestion compels me to meander in that direction. So, are you suggesting something at all?
If the market is not in equilibrium, some people might say 'but that's not what would cause a bust as it has nothing to do with it. Market equilibrium and the economic cycle of feast or famine have never been in that kind of relationship.'
It shows that cooperation is just part of the equation, but that selfishness plays an important role. It also provides am.explanation for why capitalism works in terms of creating great wealth.
The question is, which is to be master – – that's all.
The myth is that competition is the engine of the economy. That's bullshit.