1,334 karma · joined November 6, 2013
Clarification edit: Coercion in response to coercion is self-defense. If someone physically forced their way to your property, you have a right to defend yourself, and this should be enforced. We need some way make sure there's no coercion in the market.
See other comments of my explaining the virus is a pin that burst a bubble already there.
That's very true. People will read and decide for themselves.
US has huge debt -> No US politician will ever default on it -> They will print money to pay it -> Dollar loses value.
That's fairly simplified but I hope you get the point. Since they see this as a dollar crisis, they are busy buying gold, silver, gold stocks, and assets in countries that have dollar-denominated debt.
I'm going to add my 2 cents here and say that in my opinion, if the Corona situation will be solved quickly enough, or at least be perceived to be solved by the public, a rush of optimism will allow the fed to inflate the bubble and postpone (and worsen) the depression.
I actually sat down for a few hours to calculate what would have happened if this pandemic happened in the 50s, and no one could work (especially true since there was no internet). Seems like people saved enough for a year at home, on average. Today people are so levered up not only do they not have savings, they have to pay back debt.
Mises and Hayek wrote big and hard to read books about it, but two that explain this to the layman are "Meltdown" by Tom Woods[0] and "How An Economy Grows And Why It Crashes" by Peter Schiff[1]. The first is an explanation using the 2008 crisis, and the second is a very amusing yet educating economy lesson told as a kids' story.
Another book that can help grasp this, although I wouldn't read it first, is "The Forgotten Depression: 1921: The Crash That Cured Itself" by James Grant.
If you're interested in the actual business cycle theory, Tom Woods explained it briefly while promoting Meltdown. Explanation starts 14:03:
https://youtu.be/NBwJm68FkMc?t=844
[0] https://www.amazon.com/Meltdown-Economy-Tanked-Government-Ba...
[1] https://www.amazon.com/How-Economy-Grows-Why-Crashes/dp/B004...
A solution seems to be selective lockdowns by area backed by a huge amount of testing.
You ignore other countries falling the exact same faults as you say Capitalism
You seem to support a democracy where a majority could vote to oppress a minority
You blame me for suggesting a world "without government" which is extreme intellectual dishonesty, especially when I mention limited _government_.
Then you, once again, point at the problems with the US that are Cronyism, not Capitalism.
Living in the USSR is nothing more than an anecdote, the same way Mainland Chinese claim wrongs about China, probably without even knowing[0].
I'm sorry, but this is the point where I leave this discussion, as it seems to go nowhere. I suggest you read a little about the quality of life in the 1950s in the US, before Cronyism caught up to it, and compare it to the quality of life in the USSR at the time.
[0]: Warning, difficult to watch. https://youtu.be/rbHxeOQA1Mc?t=933
"at the expense of everyone else" implies a zero-sum game. Wealth gap, however, can widen even in a positive-sum game. As demonstrated by my iPhone example. I can also create a simplified game that does this. Every turn, player A gets 10 points, and player B gets 1 point. Gap widens, yet all gain.
> In practice, some systems are much more unequal than others. For example, people like Gates or Bezos simply didn't exist in USSR, there was no generational wealth, and the highest gap in pay was around 10x. Saying that there is no difference between that and what happens in capitalist countries is simply false equivalence.
This may be true if only currency was measured, but wealth is measured with assets and services as well (expenses), and in the USSR there was a ruling class, and those close to it, and they enjoyed much better lives than the common man in the USSR. They had better goods, better services, and they, yes, enjoyed Cronyism. Communism is a very poor example, as there is literally a ruling class the controls other people's lives, which is something I gathered you want to avoid.
> And cronyism is a direct byproduct of capitalism and inequality.
> And here's a breakdown of prison population by wealth in US. The prisons are predominantly filled with poor people, and you'll be hard pressed to find a CEO going to prison for any crime. Just recently Boeing killed two plane loads full of people due to criminal negligence, nobody's going to jail for that. The CEO got a golden parachute instead. https://www.prisonpolicy.org/reports/income.html
> And why is the government going hand in hand with the private sector? It's as if, and bear with me here, the private sector bought the government with all that wealth capitalists have accumulated. It amazes me to no end that you're unable to make this connection.
> Capitalism is the engine that creates a system of cronyism because it allows wealth to accumulate in the hands of the few. Again, this is not a complex concept that a fully grown adult should be struggling with.
All of these talk about either (1) Cronyism is bad or (2) Capitalism inevitably leads to Cronyism. (1) is something I agree with. (2) You've yet to demonstrate that is _unique_ to capitalism. Can you give me an example of a single country where there isn't a ruling class that enjoys better quality of life and government favors?
> Capitalism was the cause of the revolutions since it's been around. Meanwhile, you might want to read up on what USA does to communist and socialist countries around the world. Go read some history of South Asia, and Latin America for starters. No single socialist regime has been left unmolested in the past century.
That is Cronyism. Could you stop giving the Cronyisnt aspects of the US as examples of Capitalism? Capitalism calls for Non-aggression, and uses an Army in self-defense only.
> No, I'm saying that capitalism is a mechanism that allows wealth to be accumulated with a small percentage of the population, and these people end up running the country as an oligarchy as is the case with US, and other Western regimes right now. I don't think any system that allows large scale inequality is compatible with democracy.
> Meanwhile, limiting the power of the government achieves the complete opposite of what you're proposing. A democratic government answers to its citizens, while private interests only answer to their owners. Wealth inequality is the root cause for the corruption of the government, and that's what needs to be eliminated to have actual democracy and representation of the people by the government.
Well, we look differently at the role of government. To me, government isn't some tool to force other people. I don't care if it's the few rich forcing the majority middle class, or if it's the majority middle class forcing a rich minority. I am against forcing (using or threatening the use of physical force) other people.
This eliminates the "path to Cronyism" you described. When some rich people (not every rich person is bad) will go and ask for artificially low interest rates or for favoring regulation that limits competition, the government will be limited and could not give it to them.
Again -- if you believe some Communist or Socialist heaven is better suited to supply everyone's needs, no one is stopping you from building such a thing, as Capitalism lets you live as you wish. If it's as good as you say, most citizens will probably join you anyway. I'm not sure how democratic it'll be, but as long as it's voluntary, enjoy yourselves.
And here you just changed the subject. You again talk about the wealth gap. The wealth gap and zero sum game are not the same subject.
> Cronyism is a necessary result of capitalism. People who have capital will always be able to influence the state, there is no way to separate the two. Capitalists are able to buy media, fund political campaigns, bribe politicians, and so on. This is why capitalist countries necessarily turn into oligarchies.
But buying the state has nothing to do with capitalism -- it has to do with the existence of a state, and the existence of rich people. Rich people exist in every system we ever had in history, so unless you suggest we do something other than a state, all that is left is to strengthen our protection of capitalism with a better constitution.
> Rich people in Western countries practically never go to jail for fraud and theft.
Source please. But if true, is probably the fault of cronyism.
> The most egregious example was the 2008 global economic collapse where millions of people lost all their savings and none of the people responsible were punished. What's more, the institutions and people responsible got massive bailouts at the expense of tax payers.
That is the fault of government going hand the hand with the private sector. Without the government, the crisis couldn't have been that big. In short, the government had (1) very very low interest rates and (2) encouraged risky home buying (3) practically insured bad mortgages. Do you think a bank would loan to someone who can't pay back? Only if the government is there to the rescue.
There's a reason many Austrian economists predicted that crisis to amazingly fine detail.
Now, you may reply "they did it because rich people bought them". Maybe, but that's Cronyism, not Capitalism.
> Vast majority of people under capitalism have to spend large portions of their lives working just to live. This idea that you can just go and do whatever you like is a total fantasy because the only people who have the means to do that are those who were lucky enough to be born rich. The rest of the population has to spend their lives subsidizing the lifestyle of these birth lottery winners. Any regular person needs to work for at least 40 hours a week just to live, this is majority of their week taken away from them. It's utter absurdity to claim that they're free to build themselves anything in the little free time they have remaining.
I get what you're saying, but if you think there's a better way, a truly capitalist system doesn't stop you from implementing it inside of capitalism. So if you want that communist heaven, capitalism saves you the need for revolution, or the need to go find a large-enough desert island. You just build the commie heaven inside the capitalist land.
> You appear to have an incredibly infantile understanding of the relationship between capitalism and society.
That's bold, coming from the guy claiming Ghana is capitalist.
Either way, it seems like we are in agreement that Capitalism is not the problem, Cronyism is. The disagreement is if the end of all Capitalist systems is Cronyism. I think Cronyism is independent of Capitalism. All it needs is a state (=monopoly on force) and rich people. Just look at every country we had in history, capitalist or not, they all had a ruling class. The solution to that is to have the constitution limit the power of government even more. That way, when rich people will come to buy favors, there will be none for the politicians to sell.
Please do not change the subject, we were discussing zero sum game.
> No, I've described how capitalism subverts the government to the interests of the rich oligarchy produced via the system of capitalism.
Capitalism requires a separation of economy and state. What you're describing is Cronyism:
> Cronyism is the practice of partiality in awarding jobs and other advantages to friends or trusted colleagues, especially in politics and between politicians and supportive organizations.[0]
If capitalism is polluted with cronyism, you get Crony Capitalism:
> Crony capitalism is an economic system in which businesses thrive not as a result of risk, but rather as a return on money amassed through a nexus between a business class and the political class.[1]
> That's the whole point, cheating, lying, and stealing are all effective means of being competitive under capitalism. Since making profit is the sole metric for success, these behaviors are inherently encouraged by the system.
Except for the part where you spend jail time for fraud or theft.
> False, the study clearly explains its methodology and the definition for capitalist countries.
> The discussion is whether capitalism improves quality of life, and the study clearly shows that it's false across the board.
Look, the point here is not terminology. If you think Ghana is capitalist (as the paper claims), I can see why you won't like that system. Please consider, for the sake of this discussion, my definition of capitalism.
> Meanwhile, I fundamentally disagree with your definition of freedom. A system that forces people to sell vast majority of their lives simply in order to survive is a form of slavery. It takes an incredibly dim mind to primarily conceive of freedom in terms of consumerism.
That's the beauty of Capitalism. You're free. If you don't like the way of life, you go with people who think the same way, and you build yourselves a _voluntary_ communist heaven. No one will stop you, as in capitalism, all the state does is protect you from violence (which I guess is a role we agree on).
> Under capitalism the government is nothing more than a management committee for the rich...
You are mixing definitions here. Capitalism means private ownership, and what you've described there is government control. The US has Cronyism, not Capitalism. Your argument for it being mythic also mises the mark. Cheating, lying and stealing are illegal under Capitalism.
The 4th citation is completely false, as it considers non-capitalist countries capitalist. In that list, half the countries are "Mostly Unfree" or "Repressed" according to the Index of Economic Freedom[0].
If you actually look at capitalist countries, that paper supports that so-called "fantasy", as the countries mentioned as "High-income" are "Free" or "Mostly free". Irony at its best.
Even if they make all the different kinds of, say, cheese (and they don't), the quality is terrible, because they don't have those 99 competitors.
If you're at disbelief at that, wait until you take a look as the US national debt