Talk:Capitalism

Archive history

• Talk:Capitalism/archive
• Talk:Capitalism/archive 2
• Talk:Capitalism/archive 3
• Talk:Capitalism/archive 4
• Talk:Capitalism/archive 5
• Talk:Capitalism/archive 6
• Talk:Capitalism/archive 7
• Talk:Capitalism/archive 8, March 24 – April 1, 2005
• Talk:Capitalism/archive 9

Property vs. Possession

RJII is right when he points out that possession is not equal to property. I remember now that we were told that in my first law course (I did management, btw). Property means that you have special rights (such as the right to use, to sell, to destroy, blablabla), even though you might not possess it (e.g. you just bought it, but it wasn't delivered yet; or you lend it to somebody). Possession doesn't give you any right per se (which explains why robbers don't have the right to use and sell the goods they steal and thus possess). Thus, private property comes with private property rights and cannot be considered apart from them. Luis rib 20:53, 18 Apr 2005 (UTC)

Here is an interesting example of property and property rights in a pre-capitalist society [1]. Ultramarine 21:00, 18 Apr 2005 (UTC)

That's Antiquity. It's not feudalism. Proto-capitalist societies existed in many parts of the world. In any case, please avoid the confusion between property and possession. In the case of feudalism (dark age style), there was almost no property, even though there could be a lot of possession. Ancient Rome was different, as it had a definition of property more akin to capitalism (with the exception that slaves were property too). I guess China also had some sort of property rights, but I frankly don' know anything about that. Luis rib 21:07, 18 Apr 2005 (UTC)

It is bad history to label something "proto-." In some cases A may have preceeded B, but there may be cases where A preceeded C, or D, or E. Also, just because A existed a thousand years ago and exists today does not necessarily prove that they mean the same thing. The meaning and function of things (beliefs, practices) have a lot to do with their context. Change the context, you change the meaning. Slrubenstein | Talk 21:11, 18 Apr 2005 (UTC)

I agree. Proto is a qualification I use. Since I'm not historian or anything, you don't have to agree with it or anything. However, this whole discussion just shows what a fuzzy word capitalism actually is. Many economies in history had some characteristics we associate with capitalism. Should we develop a specific word for each of them? Also, capitalism today refers to totally different things: swedish capitalism certainly is different from american capitalism and from chinese capitalism and from japanese capitalism. Each of these countries have such specific characteristics that giving them the same name is an oversimplication. Luis rib 21:17, 18 Apr 2005 (UTC)

Ultramarine, you insist on the following sentence: "Similar rights existed in some earlier systems [2], but in much weaker forms, often meaning that the weak had to accept the leadership of a strong patron or lord and pay him for protection." I'm not deleting it just because I don't like what it says. I'm deleting it because I don't think it says anything. It doesn't make any sense to me. There has to be a better way of getting your point across. I would fix it if I could figure out what it was. You provide an example of private property in Rome but then describe it in a way that one might attempt to describe feudalism. What does this sentence mean? RJII 13:05, 19 Apr 2005 (UTC)

Actually, a patron system existed in Rome [3]. The justice system was very weak and protection from an patron was essential. Ultramarine 13:17, 19 Apr 2005 (UTC)

What do you mean? That's a voluntary relationship. A patron is not comparable to a feudal lord, at all. RJII 13:19, 19 Apr 2005 (UTC)

It was not voluntary. Rome had no police [4]. In such a system, protection from a strong man is essential. Ultramarine 13:24, 19 Apr 2005 (UTC)

Yes it was voluntary. No one had to deal with a patron if they didn't wish. Compare it to a lawyer today. No one forces you to take a lawyer. It's a voluntary relationship. RJII 13:27, 19 Apr 2005 (UTC)

You could choose which patron to support as client. But having a patron was essential for protection against violence. There were public courts who decieded cases but there were no official system for gathering evidence, arresting the criminals, or enforcing the decisions of the courts. You needed a patron for all of those things. Ultramarine 13:34, 19 Apr 2005 (UTC)

Having a lawyer today is essential in protecting yourself from the police when they wrongly assault you. That doesn't make the relationship with your lawyer involuntary. There is a difference between taking on a relationship with someone because it's the smart thing to do and an involuntary relationship with someone. RJII 13:42, 19 Apr 2005 (UTC)

Using this line of arguement, you could claim that a slave voluntarily obeys his owner. Anyhow, I do not understand what this has to do with you deleting the information and link. Clearly Rome had property righs, but they were in some aspects much weaker than in the capitalist states with their state controlled courts and police. What is your objection? Ultramarine 13:49, 19 Apr 2005 (UTC)

No, this line of reasoning, you could not say a slave voluntarily obeys his owner. What do you think makes interaction with another person voluntary or involuntary? It's coercion. If someone is not coercing you to obey them them then the relationship is voluntary. You're trying to stretch the word voluntary to a degree that it's meaningless. If there are criminals about trying to steal your money, it's your relationship with them that's involuntary, not the relationship with your attorney. They aren't using coercion to try to get you to get a lawyer --they're coercing you in order to get your money. You're entering into a voluntary relationship with a patron to protect yourself from coercion from someone ELSE. My objection is clear and it's what we've been talking about. The sentence doesn't seem to make sense. It looks like it equates private property in Rome with feudalism. RJII 14:12, 19 Apr 2005 (UTC)

Ultramarine, what are you doing? Look at what this sentence says: "An essential characteristic of capitalism is the institution of rule of law in establishing and protecting private property including private ownership of most of the means of production." You're inserting the word "most" doesn't correspond with the meaning of the sentence. You're putting the word "most" there doesn't make it say that capitalism includes ownership of most of the means of production. What you're doing is making the sentence say that "most" of the privately owned means of production are protected by rule of law. How about the rest of the privately owned means of production? It's just left to jungle law? No offense to you personally, but your writing and sentence formation is attrocious. It's annoying that basic things like this have to be explained to you. RJII 16:07, 19 Apr 2005 (UTC)

'atrocious' not 'attrocious'! RJII 16:07, 13 May 2005 (UTC)

Rewrite it to a better sentance if desired, but do not delete things in order to push your POV. Ultramarine 16:11, 19 Apr 2005 (UTC)

What are you talking about? You think my POV is that if any of the MOP are owned by government that it's not capitalism? I'm not aware of anyone that holds that position, not even anarcho-capitalists. Stop your ridiculous presumptions of my POV and focus on content. That's your problem. You're so worried about me pushing some POV that you've convinced yourself that I have that you don't pay attention to the quality of the article. The sentence as it stood had absolutely nothing to do with that issue you're trying to bring up. RJII 16:17, 19 Apr 2005 (UTC)

Ultramarine, now look at your proposal for the sentence: "An essential characteristic of capitalism is the institution of rule of law in establishing and protecting private property, including the mostly privately owned means of production." What this says is that an essential characteristic of capitalism is institution of rule of law in establishing the mostly privately owned means of production. It doesn't make a lot of sense. It's should say that what is essential is esablishing a right to private ownership of means of production. That doesn't mean that all the means of production are privately owned, any more than it means that all property is privately owned. If you attach that awkward appendage to means of production, then why not attach it to "private property" as well (mostly privately owned property)? RJII 16:35, 19 Apr 2005 (UTC)

Possession as Source of Rights

Luis. I, too, have distant memories of law school classes in property, and I think you overstate a point when you say "Possession doesn't give you any right per se (which explains why robbers don't have the right to use and sell the goods they steal and thus possess)." In Anglo-Saxon jurisprudence generally, it is theft for anyone other than the original owner to steal FROM a thief. If I take your car, I have the right to that car against everybody BUT you as my victim or agents of the sovereign, i.e. it is as wrong for some other party to steal it from me as it was for me to steal it in the first place. Hence the expression "possession is nine-tenths of the law." Also, peaceful possession over a long period of time can eventually protect the thief even from the original owner, i.e. in an adverse possession case ("squatters' rights".) --Christofurio 20:41, Apr 27, 2005 (UTC)

I'm not sure about "stealing from robbers" in Continental European legal tradition. It might be the same. Of course I was oversimplifying things before, for sake of clarification. Indeed there are certain exceptions (though I'm not sure about squatters' rights... that sounds more like some ad hoc solution by governements that don't know how to deal with the problem. As a matter of principle, though, and as far as it was relevant for the current article, I think that the difference between possession and property should be noted. Apart from the awkward cases you mention, one might think about much more common things like borrowing, leasing, keeping in custody, etc. where possession does not equal property. Luis rib 20:58, 27 Apr 2005 (UTC)

arbitration case concerning this article closed and dismissed by arbitrators

Just a note to let anyone who's interested know that the deceitful, frivolous, and bogus arbitration case that was launched against me by Slrubenstein and Ultramarine (concerning my edits on this article) has been closed and dismissed. Thanks to those who supported me. RJII 19:01, 27 Apr 2005 (UTC)

Congratulations RJII! Your contributions has seen a remarkable increase in quality since the arbitration case opened. For example, no use of personal attacks during the last weeks. Ultramarine 19:24, 27 Apr 2005 (UTC)

I have not ceased calling you a liar, which you are. RJII 19:27, 27 Apr 2005 (UTC)

You have used personal attacks during the last weeks? Ultramarine 19:29, 27 Apr 2005 (UTC)

Call it what you want. I and others find you and Slrubenstein extremely unreasonable to work with. RJII 19:33, 27 Apr 2005 (UTC)

intellectual property

The text says "Before the introduction of the capitalist system there was essentially no protection of intellectual property." Patents existed in the 1400's in England. Are you saying that that the system there was capitalism? Also, why is it included under characteristics of capitalism? Whether a system is capitalist or not is contingent on whether there are intellectual property rights. A capitalist system is a capitalist system regardless of whether there are intellectual property rights. RJII 18:54, 28 Apr 2005 (UTC)

Read the link. The early patent system in England was very weak and ineffective. Ultramarine 19:20, 28 Apr 2005 (UTC)

Intellectual property is not a "characteristic" of capitalism. It shouldn't be mentioned in such a context. For something to be a characteristic of capitalism it requires that if that element was absent then the system would not be capitalism. This should be talked about in another area ..not in this context. A capitalist system can have intellectual property, or it can do without. It's not a characteristic of capitalism. RJII 19:24, 28 Apr 2005 (UTC)

All modern capitalist states have a strong protection of intellectual property. No such strong protection existed before the industrial revolution. I have presented a study that indicates a link between such protection and the industrial revolution. Ultramarine 19:28, 28 Apr 2005 (UTC)

China doesn't have strong property rights and is capitalist. Luis rib 19:29, 28 Apr 2005 (UTC)

I guess you are talking about intellectual property. China is not very capitalist on economic freedom indexes. More than before certainly, but they still score very low. Ultramarine 19:32, 28 Apr 2005 (UTC)

That index is not a measure of capitalism, but economic freedom. RJII 19:36, 28 Apr 2005 (UTC)

Sorry, my mistake. Yes, I was talking about interllectual property. China is not a model capitalist system - far from it - but the parts that misuse intellectual property are the most capitalist ones (region around Shanghai; Guangdong province). In any case, many people (incl. economists) are arguing that int prop rights are much too strong in Western countries nowadays (The Economist, for instance, has repeatedly pointed it out). Indeed, by being too long (decades, sometimes), artificial monopolies are maintained long after the original development costs have been recovered. See Microsoft; music industry; pharma;...Luis rib 19:39, 28 Apr 2005 (UTC)

It is already mentioned that there are those who think that patents should abolished and thus do not see patent rights as essential. Others do however see patents as essential. Both views should be presented but not censored. Ultramarine 19:45, 28 Apr 2005 (UTC)

Don't misunderstand me. I'm not saying that patents should be abolished (and neither does The Economist). Just that they sometimes may be too long. Of course a certain level of patents is necessary to have incentives for research - after all it's not the generic pharma companies that develop new medicine. I was just arguing that patents may not be a strictly necessary condition for capitalism, even if it certainly helps it. Luis rib 19:50, 28 Apr 2005 (UTC)

Some think that they are, some think not. Both sides should be presented. Ultramarine 19:57, 28 Apr 2005 (UTC)

Sources re poverty

There are countless sources regarding mobilization program in China (it's not "mobilization of the masses", BTW). Google for "eradication of poverty in china 1978" and you will find a plenty. Here is one such source. It's not like this is some kind of a state secret. If you need any further references, feel free to ask. Next time you want to revert something, please take the effort to at least make a google search.

The original text said that "if inequality leads to higher average wealth and higher wealth and income for most people, then wealth inequality may be acceptable.". This is probably true per se, but this is not what capitalism is about in reality. In reality the income for most people is lower. In UK about 25% of people live in poverty, in Brazil 47% live in absolute poverty. In African "capitalist" countries it's even worse. See this link. Capitalism doesn't mean that most people live better, it means that capitalists live better. I thought the name was kinda giving it away... Paranoid 23:39, 30 Apr 2005 (UTC)

Your sources are a censored Chinese newspaper and a blog that do not give a source for their claims? Please give a statistics or a peer-reveiwed paper to support your claims. Ultramarine 01:04, 1 May 2005 (UTC)

Here are some studies showing that the poor has a higher absolute income and higher standards of living in capitalist countires. [5]. [6].

Oh my god! You are refering to Cato Institute as a source? First, that Chinese program started in 1978 is a fact that is not disputed anywhere (and how do you imagine the Chinese lying about it?) . Google for it and pick the source that you like. Second, Ukraine and Rwanda had economic freedom rating of 5.3 in 2002. Russia (5.0) was between Togo and Burundi. Norway (probably the country with the highest income for the poor [7]) was 36th!! If you believe that this index has anything with the situation of the poor, you are delusional. Paranoid 01:35, 1 May 2005 (UTC)

One country does not prove anything, look at the aggregate statistics. Absolute income clearly rises with more economic freedom for the 10% poorest. Ultramarine 02:38, 1 May 2005 (UTC)

Firstly, the welfare, income, and living standard of the poor are affected by many things: social programs, the degree of industrialization, availiblity of natural resources, etc. Suggesting that capitalism does this or does that to the poor is simplistic and inevitably POV. Instead of a strong statement either way, how about:

"While many capitalist countries have experienced significant economic growth, it is unclear how the poorest in society are affected. Studies [Im sure Ultramarine can provide one] have suggested that as average income rises, the absolute income of the poor does too, but the relative share of national income received by the poorest in society usually does not increase and may in fact decrease."

The message should be that significant inequality seems intrinsic to capitalist countries, yet the average income of the poor does seem to increase. Perhaps the mention of China can be left out, as the recent history of China is far more complicated than communism vs capitalism or pre-mobilization vs post. Mgw 02:14, 1 May 2005 (UTC)

I don't think you can be justified saying "as the average income rises". The increase of average income is not a cause, it's a result of some other cause. There can be no causation between increased average income and increased income of the poor, only corellation. Yes, there is some corellation, but as the table here shows, it's rather weak. It's also disingenuous to compare different countries. Yes, the US has higher average income than Cuba. But first, it doesn't prove that by switcing to capitalism Cuba will become wealther (or that US will become poorer by switching to socialism and planned economy), and second, it ignores that fact that the life of the poor is in many respects better on Cuba than in the US. For one, government ensures that everyone is provided with proper nutrition, and there is free medical care for everyone. Some indicators, such as child death rates show that despite the inhumane economic sanctions life in Cuba is in some respects better than in the US. Yeah, life there is not perfect, but you only need to look a hundred kilometers to the East to find out what would happen to Cuba if not for Fidel and the socialist economic order. Haiti is the poorest country in the western hemisphere (according to the WFP). CIA agrees and adds that "80% of the population lives in abject poverty". That's what we should be comparing Cuban socialism with, not with the United States. It's the same all other the world - there is reality. You can take a country into some economic dream dimension and build capitalism there, you have to do it in real world. And in real world it was proven again and again that capitalism and free market increase poverty. Poverty is an integral part of capitalism, read fon Haiek or any other prominent philosopher of Western liberalism. Even the richest Western countries have poverty if they are capitalist. Yes, the average income is higher, but not because of the market, it's because of the exploitation of the third world. If you want to build a just society where people can live in dignity and without exploiting other countries, socialism (communism) is the only way to go. These are facts. Paranoid 16:23, 1 May 2005 (UTC)

Paranoid, the only sources you have given are censored chinese newspaper and a blog that do not give a source for their statistics. In return, I have shown several peer-reviewed studies. Ultramarine 16:12, 1 May 2005 (UTC)

Cato Journal is a mouth piece of a libertarian think tank. The only thing they review the papers for is the presence of libertarian bias. The articles do not prove what you claim they do. Corellation of higher economic freedom with higher incomes is obvious, because the economic freedom index is based on the ideal model of a western capitalist society, which just happen to be more affluent. However, you clearly lie when you claim that the share "does not decrease". A transition of capitalism decreases the share of the poor in total wealth and increases inequality. This is obvious to everyone even remotedly familiar with the facts. Please stop spreading lies, have some decency. this is the example of Russia - the growth in inequality during the transition from a socialist planned economy to the capitalist market economy. And in case you were wondering about the absolute values, the total production (and thus incomes) dropped about 50%. But may be the poor will just die out and people like you will be happy because once again the economic principles of the free market will trumple the lifes of real people.

It is dishonest to compare the United States with a socialist country and claim that merely by abandoning socialism and building a capitalist society the latter country will become as wealthy as the US. This is lie, this is not supported by reality, this has never happened. The only countries that managed to eliminate poverty are the socialist countries. All capitalist countries have poverty, there are millions of people who are hungry, who are homeless, who don't have access to health care. There is poverty in the United States, despite the enormous amount of wealth in the economy. There was no poverty in the Soviet Union, everyone had access to free education, free health care, a guaranteed job. I understand how you must feel - you must protect the poor defenseless capitalism from communist scum, but please, do it somewhere else. Take your lies with you and spread them elsewhere. Paranoid 16:23, 1 May 2005 (UTC)

Please give some peer-reviewed studies that support your theories. Or credible statistics, not a graph without a source. Ultramarine 16:26, 1 May 2005 (UTC)

Ultramarine, are you so horribly biased, functionally illiterate or blind that you can't do a simple google search for china poverty eradication 1978? I mean, it's not like you had to think for yourself - I already gave you the relevant keywords to search for. Or are you simply brainwashed so professionally that you can't see the facts and instead the reiterate the gospel of capitalism? Or are you paid by some libertarian or conservative think tank to troll on the Internet and defend the irrational lies? What is the truth, tell us?

Result number 3 to the above search is Poverty Report on China by United Nations Development Programme. You really are stupid for questioning facts that are as non-controversial as they get and instead blindly accepting the lies told by aggressive pro-capitalist think tanks. Capitalism didn't eliminate poverty in China, a decades-old government programme did. If capitalism was ever able of eliminating poverty, surely it would eliminate it in the US, huh? But the population below poverty line in the US is 12%, while it is 2% LESS in China. Stop pushing your lies, please. We are tall tired of your capitalist propaganda. Go somewhere else to more gullible people.

As for the graph, the data source is the official Russian statistics from the Goskomstat. The illustration is taken from [8].Paranoid 16:34, 1 May 2005 (UTC)

Please avoid personal attacks when you have no arguments. I will not do your work for you, google yourself and present evidence. You do not seem to understand that what happened in one or two countries (like in Russia) is not very interesting, you need to look at aggregate statistics for many countries. And aggregate statistics do strongly show that absolute income increase in capitalist countries for the poorest. You have not shown any evidence contrarty to that. Ultramarine 16:39, 1 May 2005 (UTC)

Furthermore, you do not seem to undertand the difference between absolute and relative poverty. Do you actually think that the poverty line in China and the US represent the same abolute income? Ultramarine 16:42, 1 May 2005 (UTC)

1. You have both violated 3RR [9].

2. The edit war you two are waging is not productive or helpful in any way.

3. The topic of your war is simplistic: as I explained above, many things afffect the welfare of the poor, and comparing the most basic statsitics on the poor in Cuba vs. the US, Cuba vs Haiti, or Communist vs. Capitalist China is not going to tell you much about the economic system in those countries. It's just too simplistic.

4. You should instead say in that section something to the effect of "while many things affect the welfare of the poor, the effect of capitalism is a matter of dispute. While some studies have suggested that the absolute incomes of the poor rise, others argue that relative to socialism [or whatever you want to put], capitalism provides little for the poor". Mgw 17:18, 1 May 2005 (UTC)

I have not violated 3RR since I have added more references. If you argue that capitalism do not increase the income of the poor, please provide global statistcs and peer-reviewed studies. Ultramarine 17:21, 1 May 2005 (UTC)

I am not arguing anything, as you will see if you read what I just wrote. I am suggesting a way to end this ridiculous edit war. Mgw 17:26, 1 May 2005 (UTC)

I agree on that. Ultramarine 17:31, 1 May 2005 (UTC)

I'm just one day away from wikipedia and when I come back I notice I started an edit war... Anyway, I believe Mgw and Ultramarine have already stated everything needed to be said in the circumstances, so i'll just add some comments about various countries that were mentioned in the discussion. a) China. That where the whole discussion started. While I don't dispute the existence of the mass movement against poverty (or whatever it was called), I certainly doubt that it had major effects on the Chinese economy. Incidentally, however, 1978 or 1979 were also the years when Deng Xiaoping started to open up the Chinese economy, which led in the end to the boom in the 90's and the current decade. Also, I don't think that poverty was eradicated in China, on the contrary! The provinces not touched by capitalism (Xinjiang, Inner Mongolia, the Nordeast, Sichuan, etc.) are as poor as under Mao, and no mass movement helped eradicate poverty there. Rather, it seems that the provinces where capitalism has taken hold (Guangdong, Shanghai and the region in between) are those where poverty has fallen and where living conditions are the best in China now (whatever that implies...). b)Norway may be the richest country in the world (i doubt that - i've seen no indication that it has passed Luxembourg) but it certainly not the freest. I've lived in Denmark for a few months, and have a few Norwegian friends, and my experience from all that is that the Norwegian economy is pretty much closed and controlled by a few big companies and cartels (pretty much like Denmark, Sweden, or Switzerland for that matter). Also, Norway's wealth comes mostly from its petrol reserves in the North Sea. A better example of economic freedom helping wealth creation is Singapore: it has one of the highest levels of economic freedom, I think, and managed to develop from a swampy island to one of the world's most developped cities. c)Africa. There was some talk about African capitalist countries. Well, I'd like to know one. Just a single one. To my knowledge, most african countries have unfortunately been controlled by cleptocrats and crony capitalists (not to be confused with true capitalism). Also, most African countries implemented socialist-style economic policies after independence (like India and much of South America, by the way), which completely crippled them. While right after colonialism they were ahead of most Asian countries, by the nineties they had fallen behind almost all of them. South Korea, in particular, was much poorer than most of Africa after the Korean war, and managed to develop at breakneck speed when it implemented capitalism, even passing some European countries like Portugal or Greece. d)Cuba. Paranoid's rosy picture of Cuba is less than convincing. True, it's not the worst country in the world. There are worse, like indeed Haiti (rather a model capitalist state though... it is even laughable to call Haiti capitalist) or most of Africa or North Korea. Cuba also has relatively good educational and health systems. Yet people are, since reforms last year, not even allowed to rent rooms to tourists. They are not allowed to own dollars anymore either (which, given their universal acceptability, where favoured to the virtually non-exchangeable Cuban pesos). They don't starve, true, but are they really well-nourished? DO people have a choice what to eat and buy? Hardly. And here's the big difference between Cuba and the US: in the US, even the poor have at least some basic freedoms, even if it's only the choice between a Coke or a Pepsi. Such a freedom of choice doesn't exist on Cuba. Luis rib 21:05, 1 May 2005 (UTC)

Actually, Botswana is a relatively capitalist African country. You never hear much about it, but several decades it was actually had the fastest growing economy in the whole world. The left of course never talks about it. Ultramarine 21:29, 1 May 2005 (UTC)

The best comparison between communist and capitalist treatment of the poorest is of course China and Taiwan, North and South Korea, and East and West Germany. They had similar income and culture before being split and capitalist countries score relatively high on economic freedom. That the poorest starved and is starving the death in China and North Korea is without doubt. I have been looking for some studies on the absolute income of the poorest in East Germany compared to West Germany before and after the reunification. Do anyone have any data? Ultramarine 21:29, 1 May 2005 (UTC)

I don't have time to respond to everything, so I will just say this in response to Luis rib. It betrays your irrationality when you start talking about "true capitalist states". Yes, if we define a true capitalist state as a rich capitalist state, than by definition it will have high average income. I am saying that in reality a transition to capitalism (defined as private property on means of production, convertability of the national currency, free foreign trade and the right to incorporate) does not necessarily bring significant (if any) benefits to the society. In those cases when a transition to capitalism coincides with growth of average income, this is often a direct result of capital investment programme. China has economic growth not because it is capitalist, but because it attracted investment, created new industries and new jobs. It doesn't matter who owns these enterprises - the state or western corporations. Furthermore, I don't see how we can claim that China became a capitalist country. And if we admit that it is only partly capitalist, where is the evidence that poverty was reduced because of capitalist elements. You all seem bent on misenterpreting what is said about it - it wasn't a "mass movement", it was a mobilization program by the state, i.e. a large government-financed and government run program to eradicate poverty. Yes, it welcome involvement from everybody, including in 1990s the private companies. But the primary role here was the role of government action. The program started in 1978 - it's a fact. And some results were achieved immediately, not in 1990s, when capitalist elements were introduced.

That's why it's disingenious to claim that capitalism can reduce poverty, see example of China. The truth is (people, read fon Haiek, Spenser, Townsend, Sen, and of course, Smith, Ricardo and Maltus) that poverty is inseparable from capitalism. Claiming the opposing, while 12% of people in the US live below poverty line, is a lie. Paranoid 23:11, 1 May 2005 (UTC)

It is fair to say that capitalism doesn't erradicate poverty, and that inequality is an intrinsic feature of it. But it is a big, blanket statement to say that it cannot reduce poverty or simply that it does. Many things affect the welfare of the poor, as I have argued above. It's fine that you have an opinion, but to conform to NPOV, we shouldn't draw a conclusion in the article either way. There are published peer-reviewed articles on both sides, so the only neutral way to say it is that it is diputed, and perhaps make very general statements about averages and trends. Even if you think it is "a lie" that capitalism can reduce poverty, many people don't, so if you approach this with a NPOV, you can't make the article conform to that POV. Mgw 01:56, 2 May 2005 (UTC)

Your comments about China, Paranoid, are puzzling to me. "China has economic growth not because it is capitalist, but because it attracted investment, created new industries and new jobs. It doesn't matter who owns these enterprises - the state or western corporations." What does this mean? It seems to me that many western investors are a lot happier to invest in Chinese equity than in Chinese government securities. Yet to the extent that they get the chance to invest in equity, they by definition become the owners. And, as you say, China's recent successes have a lot to do with "attracting investment". So in what sense does it "not matter" how they did that -- i.e. by opening up to equity? Because they could conceivably have done so differently? That's a non-point, like saying they could conceivably have gotten help from Alpha Centauri. --Christofurio 15:56, May 2, 2005 (UTC)

I decided to ignore this article, because I don't have enough time to deal with hard-line brainwashed capitalism apologists. That's why I haven't read your comment here and you had to ask on my talk page.

What I was trying to say is very simple and you can interpret my words literally (pardon the simplstic language, but I want it to be as clear as possible). There are A) consumer goods, there is B) equipment to produce consumer goods and there is C) equipment to produce equipment. You say your economy grows when it produces more (by definition). To produce more you need more B and C equipment (this is very wide and includes better management practices, etc.). And to produce more equipment you need more C equipment. Now, it doesn't matter how your economy is operated - whether it's a planned economy or a market one, a capitalist economy or a socialist one. What matters is that if you buy/make more C-equipment you will be able to produce more equipment (B+C) which will allow you produce more goods and more equipment and be happy.

Now the big problem is where to get the resources to buy more C (and B) equipment in the first place. For example Soviet Union channeled the resources from peasants in 1920-1930s to build more heavy engineering plants. This allowed it to produce enough machines to build all industries it needed and miraculously it became capable of outproducing Nazi Germany and winning the Second World War. China in 1980-1990s didn't have the peasantry, from which to take the resources. In fact, the peasants needed resources from somewhere to barely survive. So China decided to use external investment, buying equipment from the US, from Europe and elsewhere. The productive capacity went up and the economy improved.

It doesn't matter much where they got the resources and doesn't matter who owns the factories (capitalists or the state). What matters is that their economy needed capital expenditures and it got them. You can argue that a capitalist market economy is inherently more efficient, but this is not the point (and I am convinced that it is not true). The point is that China grew because of additional investments, and capitalism was merely a way to get them. If a starving man is fed by some Christian charity (by converting from some pagan cult to Christianity) and given enough money to attend college, you do not say that accepting his Saviour Jesus Christ helped the guy, you say that food and money did. Accepting JC was only the way of getting the stuff and there are other ways (although it might have been the only option in his particular situation).

Again, sorry for simplistic language, but I it's hard to explain these things to people indoctrinated about capitalism. Paranoid 15:25, 17 May 2005 (UTC)

I strongly believe that if someone isn't able to express their ideas clearly and concisely that those ideas themselves are muddled and confused. RJII 15:37, 17 May 2005 (UTC)

1) Style Over Substance fallacy, 2) ad Hominem fallacy.

Would you swear to me that you would make a real effort to understand my arguments if I rewrite them clearly and concisely? I doubt it, that's why I didn't really bother. I see that you are also indoctrinated and would probably use any excuse to ignore anything contradicting your preconceptions. In that unlikely case that you were forced to examine the arguments and compose a reply, it would be filled with logical fallacies for no other reason that you believe in capitalism so strongly. Come on, read the "muddled and confused" text again, it's only half a page, and then try to tell me honestly that you don't understand it or that it's obviously wrong. Paranoid 19:08, 17 May 2005 (UTC)

I've been busy and away from wikipedia, so I limit my comments now. Just a few ones though. First of all, Paranoid claimed somewhere above that in the US 12% of people live below the poverty line. That is certainly true, but it is ambiguous, since each country defines its poverty line differently, relatively to its own GDP/head. Thus someone living below the poverty line in the US still has a much higher standard of life than the average African.

Now that you are back to Wikipedia, may be you will find some time to check the Poverty line article. Living in poverty is not ambiguous, it means not having enough money that you need to live. When CIA says that 12% of Americans live below poverty line it means the same thing. And please take the time to do a fucking search for "12%" on this page to find the goddamn reference to the source. Don't make it sound if it's just silly Paranoid claiming that. Thanks. And you are wrong to claim that someone in the US living below the poverty line has a much higher standard of life. This is not so, because the necessities in China are much cheaper.Paranoid 13:33, 21 May 2005 (UTC)

Actually it is very ambiguous. Each country defines poverty differently, and defines "enough to live" differently. There is no international standard for a poverty line. There's other standards, like nb of people living with less than a dollar per day (adjusting for purchasing power). And I don't deny the 12%. My phrasing above was poor, my apologies for that. I still think that someone that lives below the poverty line in the US has a better life than someone that lives below the poverty line in, say, Mozambique. Luis rib 18:04, 21 May 2005 (UTC)

Concerning Paranoid's latests comments: well, you point out yourself that in the end China was able to get the necessary funds thanks to capitalism. That seems to settle the issue, no? If the Chinese state had attempted to borrow money to finance those capital expenditures, its public finances would have disintegrated in a matter of a few year. After all, China can't simply print money to buy new equipement (several countries tries that - and it utterly failed). So in the end China could only develop thanks to capitalism, in particular thanks to the global financial markets. Quod erat demonstrandum. Luis rib 21:22, 18 May 2005 (UTC)

Have you heard about Post hoc, ergo propter hoc, my Latin-speaking friend? It's a common logical fallacy that you just used. There were different sources of funds for investment. The experience of Soviet Union shows that you can achieve amazingly high growth rates using only external resources. There is no reason to believe that it wouldn't be possible for China. However, if you want to make an argument that world finance is closely related to ideology today and that communist countries can't expect to get loans or investments from capitalist countries, I would probably agree. Paranoid 13:33, 21 May 2005 (UTC)

I doubt the "amazing high growth" you claim the Soviet Union had. There was growth, for a short period of time, concentrated in the industrial sector (it failed completely in agriculture). It was not very long lasting. Your assumption that borrowing by the state and then investing by the state is more efficient than foreign investment by independent companies implies that the state must be more efficient at allocating ressources than the markets. This is widely refuted. Indeed, it would require such a huge amount in burocracy to monitor all sectors of the economy. The Soviet Union failed totally at that, esp. when it comes to consumer goods. We have no indication that China would be more efficient at it.Luis rib 18:04, 21 May 2005 (UTC)

One further comment: production of end goods (and of goods in general) is actually a relatively small part of GDP. In all countries (except maybe the least developped ones) services contribute to the largest part of GDP. Luis rib 21:22, 18 May 2005 (UTC)

Ultramarine deleting paragraph about private ownership of the means of production

Ultramarine, you are wrong to delete the paragraph of the private ownership of the means of production in the Private Property section. Private ownership of the MOP is absolutely essential to capitalism, and it deserves more than a one-sentence mention. Also, it is does not only contain pro-capitalist views on this but includes the Marxist opposition as well. A section about characterists of capitalism without expanding on private ownership of the means of production would be severely deficient. RJII 05:02, 2 May 2005 (UTC)

Your paragraph contain no arguments that is not mentioned elsewhere. It is empty filler. Ultramarine 05:10, 2 May 2005 (UTC)

The "How capitalism work" section

Should be changed to a characteristic section, since it almost exclusively discusses corporations. Any against? Ultramarine 15:15, 15 May 2005 (UTC)

Rather silly analogy

First, Paranoid, you said that capitalism wasn't helping China, it was only helping to raise outside money, which was helping China. When I questioned this reasoning, you explained this way, "If a starving man is fed by some Christian charity (by converting from some pagan cult to Christianity) and given enough money to attend college, you do not say that accepting his Saviour Jesus Christ helped the guy, you say that food and money did. Accepting JC was only the way of getting the stuff and there are other ways (although it might have been the only option in his particular situation)."

That is so obviously an unhelpful analogy that one feels silly explaining why. Christianity isn't primarily a view about investment, it's a view about how a soul might be saved. Capitalism, though (as a theory) is primarily a view about investments (and closely related issues). So to say that China's recent policy changes haven't helped, except by way of helping attract investment, is off base in a way the analogous statements about Christianity wouldn't be.

Capitalism claims that allowing profit and loss attracts investment to its most productive employment, and that this is socially useful. When you say that China, newly capitalist in many respects, has managed to attract investment, which has proven useful, and then you turn around and say "but this is irrelevant to the merits of capitalism," you sounds rather blinkered. But have it your way, as they used to say at Burger King. --Christofurio 01:06, May 21, 2005 (UTC)

Don't be silly. Read what I wrote again. Yes, capitalism is related to raising capital. But 1) there are other ways to do that and 2) socialist countries also attract investment. If you want a better analogy (I agree that the first one wasn't perfect, but it still was valid), have this one:

A very poor, but very bright guy starts studying in the library. He learns some skills, gets a job, earns some money. Eventually he goes to Harvard and graduates, which lands him in an even better job. It doesn't mean that he got a good job only because he went to Harvard. Paranoid 13:33, 21 May 2005 (UTC)

Yes, this is a better analogy, and it makes my point much better than it makes yours. We certainly wouldn't say in such a case that the acquisition of the "even better job" was irrelevant to the question of whether a Harvard education was valuable for this alumnus. If some third party said "gee, Harvard did him some good," shouldn't we agree with that? As for the notion that socialist countries attract investment ... that is true. They generally attract it to the degree to which they are willing to compromise their professed principles. Exactly what China has done, except that they've done it so long and so completely they've made that willingness their new and brightest principle. Your conclusory sentence is "there are other ways to do that" -- yet a conclusion doesn't constitute reasoning.

But aside from faulty analogical reasoning or conclusory statements, let's think about something else you wrote. "You say your economy grows when it produces more (by definition)." That's a tricky definition. An economy doesn't necessarily grow in value because it is producing more stuff. It grows in value if it produces more of value or more valuable stuff (even if, physically, less of it). This is only true if its a tautology, and its only both of those if we're careful about it! If we understand value in a consumer-oriented way, an economy can be expected to grow if producers are rewarded for giving customers what they want and punished for failing to do so. Profit and loss are good natural ways of doing that. --Christofurio 03:06, May 22, 2005 (UTC)

Ultramarine what the hell are you doing?

Why are you taking out a picture of a private factory and putting in a picture of a government-owned dam as an example of private ownership??? RJII 19:20, 25 May 2005 (UTC)

I put an image of a bank I saw in Rotterdam. I was pretty amazed by its architecture. The reason to put in a bank is to show that money is treated as a commodity like almost any other in capitalism. Maybe the place is not the best, so it could be moved somewhere else. BTW I don't see why we should delete the factory. It refers nicely to the industrial revolution and the infancy of modern capitalism, as well as relating to Marx's proletariat. Luis rib 19:39, 25 May 2005 (UTC)

About the factory, I thought so too. Also I thought the pollution coming out of the factory was interesting. RJII 19:44, 25 May 2005 (UTC)

Ultramarine, what's with the windmill thing? That picture says nothing. There is no indication that it's privately-owned. The land picture doesn't say much in itself either. The factory picture is much better, for the reasons Luis and I have stated. RJII 19:55, 25 May 2005 (UTC)

I agree with RJII. Land is a totally atypical means of production; while power is one of the least free markets in the world. In all, very bad examples, even though the pictures may be ok. Please put back the factory. Luis rib 20:01, 25 May 2005 (UTC)

I'm not sure what Ultramarine's motivation is, but now that I think about it, he may be upset that the picture showed pollution, since he's putting in pictures of windmills and dams. He wants to paint a overly-nice picture of capitalism with blue skies, water, and lush land maybe? RJII 20:18, 25 May 2005 (UTC)

Hmm, maybe you're right. But that's a POV statement, since pollution is an externality and thus exactly one of the things that capitalism can't deal with very well. This factory picture has more and more layers of interpretation and becomes more and more useful... Luis rib 20:22, 25 May 2005 (UTC)

The communist states had more pollution than the capitalist ones. So its is misleading to show dreary picture implicating pollution. Ultramarine 20:31, 25 May 2005 (UTC)

Wow, so I was right. RJII 20:34, 25 May 2005 (UTC)

So what? The factory was built in the 19th century. You can't seriously expect it to comply to 21st century ecologic standards. You're being childish, really. Luis rib 20:36, 25 May 2005 (UTC)

You have just stated why the picture should not be in the article. Ultramarine 21:23, 25 May 2005 (UTC)

don't get it. Capitalism existed then as well. If we just put pictures of capitalism from now, it will seem like it's a very recent phenomenon. Luis rib 21:25, 25 May 2005 (UTC)

Why not have some pictures of slave ships? Ultramarine 21:30, 25 May 2005 (UTC)

Look, everyone knows that pollution exists in capitalist as well as statist economies. It's simply an accurate portrayal of a privately-owned factory. You want to paint an absurdly roseate picture of capitalism ..one that's unrealistic. One could just as easily find a picture of a modern factory with even more pollution. The picture itself is not in any way alluding that capitalism causes pollution. And, your land picture is ridiculous ..portraying private ownership of the means of production by showing peasants manning a communist rice field? RJII 22:02, 25 May 2005 (UTC)

How about adding the picture to the other 2. This would make it balanced. Ultramarine 22:07, 25 May 2005 (UTC)

The picture is of a tea plantation, very capitalist. Ultramarine 22:12, 25 May 2005 (UTC)

Then why is it called "rice.jpg"? RJII 22:27, 25 May 2005 (UTC)

Read the picture page. Anyhow, Indonesia is not a communist country. Ultramarine 22:44, 25 May 2005 (UTC)

The Indonesian government owns tea plantations. For example: [10] RJII 22:52, 25 May 2005 (UTC)

If there's going to be a picture of land, at least there should be some certainty that the land in the picture is privately ownership of the means of producution. RJII 01:21, 26 May 2005 (UTC)

Ultramarine, now what the hell are you doing? You removed a picture of a factory with the explanation: "Removed probably publicly owned company." I suppose you mean publicly owned as in they sell stock to the public. That doesn't make it government-owned ..it's still privately-owned. Jesus. (Anything that is not owned by the government, is owned by the private sector.)RJII 20:29, 26 May 2005 (UTC)

Since you removed my picture on similar grounds, I ask the same of you. Present evidence that the company on the picture is privately owned. Also, do not post picture without giving a source so one can check fair use claims. Ultramarine 20:46, 26 May 2005 (UTC)

Dude, it's the H.A. Moyers Carriage Factory. It was not owned by the government. Look it up. By the way, I do not have to tell you where I got any particular picture. RJII 20:58, 26 May 2005 (UTC)

You do have to tell where you got the picture. Unless you do, I will mark them for deletion. Also, you removed my picture without giving a source, only that it could be state owned. I will do the same with the factory image. Ultramarine 21:09, 26 May 2005 (UTC)

Yes, the reason I removed your picture is because it could be state-owned, since the Indonesian government owns tea farms. Why not post something that we know for sure is not government owned? The H.A. Moyer Factory is not state-owned. You're just upset that the factory has a little pollution coming out as you admitted above, and you're trying to find any way possible to make capitalism look squeeky clean. It's ridiculous. By the way, look up copyright law ..old pictures don't have copyright protection. RJII 21:28, 26 May 2005 (UTC)

But you have presented no evidence that my picture was of a state owned tea plantation and no evidence that your picture is of privately owned company at the time. Also, marked picture as copyright violation for deletion. Ultramarine 21:53, 26 May 2005 (UTC)

Dude, the name of the company is written right on the building!..the H.A. Moyer Carriage Company of Syracuse New York. It was not a socialist factory. You are a major annoyance. You contribute next to nothing to this article but only pick trivial disputes with people. You had no clue what capitalism was, hence I had to force a definition in the article. I even had to fight you to get in the article that private ownership of capital was essential to capitalism. What purpose do you serve here? Why don't you work on an article about something you have the faintest idea about? RJII 22:17, 26 May 2005 (UTC)

Don't be ridiculous. I wrote most of this article before you even appeared here. I am the one who turned this propagande piece for socialism into an article using empirical evidence. Ultramarine 23:05, 26 May 2005 (UTC)

You wrote most of this article? No wonder it was so horrible. You had no clue what socialism was (nor what capitalism was) until I made the differentiation. Anything you do add is pretty much incoherent and needs to be reworded by someone else if they're able to determine what you're trying to say. We shouldn't have to suffer through your antics. Learn about a subject before you write about it. And alledging that the Moyer Carriage Company might be a socialist enterprise! please... Get a clue. RJII 23:22, 26 May 2005 (UTC)

Images

Many good images. I think we should add some graphs that describes the advantages for capitalism or are otherwise interesting. Here are two from Heritage foundation: [11][12]. The Frazer institute has several good graphs at end of this report [13]. Does anyone know if fair use allows one take one such image? I doubt that the copyright owners would object. Ultramarine 10:05, 26 May 2005 (UTC)

source for Marx quote requested

In the Etymology section, it says: "Marx and Engels refer to the "Capitalist production system". I'd like a source for this. Thanks. RJII 16:00, 26 May 2005 (UTC)

• huh?...if this is not a joke question: you are giving youself the answer, it's Marx and Engels. And there is also no reason to doubt that, as it is widely known. I don't quite understand your question?? Have you not seen the source in the sentence you posted or do you doubt it was Marx/Engels? Are you trying to find out when it was first mentioned?--Fenice 08:56, 28 May 2005 (UTC)

I just read your edit summary where you call it "alleged quote". It is not alleged, it does exist, Marx/Engels really is one of the first sources where you can find this word. The book is called 'Karl Marx/Friedrich Engels Collected Works'. It should be mentioned because it is widely known. --Fenice 09:11, 28 May 2005 (UTC)

It says it's in "Das Kapital." It's not in there. Which "work" is it in, among the collected works? RJII 15:05, 28 May 2005 (UTC)

The term appears (at least) here (in German, scan page for 'kapitalistische Produktionsweise'), this is Volume 22 of the Collected Works of Marx/Engels. Collected Works seems to really be a collection of 43 Books, one of which is "Das Kapital".--Fenice 08:43, 29 May 2005 (UTC)

I know that "capitalist production" is a phrase used, but I've never seen "capitalist production system." RJII 11:56, 29 May 2005 (UTC)

The translation of "kapitalistische Produktionsweise" would be capitalist production system. The german suffix -weise often means -system. Luis rib 13:05, 29 May 2005 (UTC)

I'm looking around and everwhere I see "kapitalistische produktionsweise" translated in Das Kapital, it's just "capitalist production." I asked a german person and he said it's something like "production way" or "way of production." RJII 17:49, 29 May 2005 (UTC)

Your German friend was correct. "Way of production" is certainly the most accurate translation. It's just a detail, in my opinion, but we might as well translate it correctly. BTW, just take care that nouns in German have a capital starting letter. Luis rib 19:02, 29 May 2005 (UTC)

Yes, I can see that problem. capitalist production system would literally translate to 'kapitalistisches Produktionssystem', and that is not in this text. 'kapitalistischen Produktionsform' however is in this text and it is easy and obvious to translate to 'capitalist form of production'. --Fenice 13:47, 30 May 2005 (UTC)

Amish farm

I saw in a documentary that the Amish live in quasi-communist communities, where most things are shared. Is an Amish farm really the best example of a capitalist agricultural system? Also, it is my opinion that the initial factory picture was much better than any of the three that replace it now. Finally, where is that windmill from? It has no name or description - not to mention that power production is probably one of the least capitalist industries in the world, since in many countries it is done by state-owned entreprises. Luis rib 17:21, 28 May 2005 (UTC)

Yeah, a profit-oriented farm would probably be better. I agree that the other factory picture is better, but unfortunately Ultramarine has put a copyright dispute notice on it as a desperate attempt to keep it out for whatever bizarre reasons he has. [14] So, we have to wait for that to get resolved to put it back up I think. The picture is a scan of an old postcard ...predates copyright protection, and besides, it's fair use to take a photo of postcard. And, yes, the windmill picture is ridiculous ..if showing private power it should at least be a private power plant. The picture looks like it would be for an article about alternative energy. RJII 18:23, 28 May 2005 (UTC)

If you click on the windmill image, you'll see that actually it's a rooftop windmill from some guy in Canada. How the hell does that relate to capitalism? Am I allowed to put also a picture of our vegetable garden in that case? Luis rib 20:29, 28 May 2005 (UTC)

Role of government and market failures

I deleted some stuff about whether capitalism is "declining" and something about anarcho-capitalism since it didn't really pertain to market failure. The section was lacking focus. Besides that, I think the content in the section should be worked into the Free Market section, as it's about government intervention into the free market to overcome market failure. Possibly, some of the deleted stuff about decline of capitalism or whatever can be made into a new section, or maybe worked into the Which Economies are Capitalist section. RJII 03:33, 31 May 2005 (UTC)

questioning new entry in intro debates section

debates center on whether capitalism ..."can exist without some measure of external governmental control, considering the dependence of the modern free market on legal currency and legislation defining the parameters of property ownership." <- What does this mean? If it says anything substantial maybe we can rewrite it, because as it stands it doesn't seem to make any sense. RJII 23:15, 1 Jun 2005 (UTC)

Crony Capitalism

The term seems to have disppeared from the Wikipedia. It's stil an econmic reality for many people around the world. It would be convenient to put it back, or at least make a subsection of corruption

Hey I fixed it. Looks like someone played a joke and had it redirected to capitalism. RJII 01:44, 14 Jun 2005 (UTC)

Everything for profit?

I have a real problem with the opening line: "Capitalism has been defined in various ways (see definitions of capitalism). In common usage it refers to an economic system in which all or most of the means of production are privately owned and operated for profit"

First of all, historically, proponents of capitalism have never, to my knowledge, believed that families should be run for monetary profit. Thus, I don't know how common usage could refer to an economic system in which ALL the means of production are run for profit. Further, since I don't know of any historical "upper bound" on the percentage of the economy that "ought" to be run for profit advocated by capitalists, it doesn't make much sense either to say that in capitalism, "most" of the means of production are operated for profit. It makes more sense to characterize capitalism - as it has been historically advocated by capitalists - as one in which private ownership of the means of production is allowed. The more possible means of production can be privately owned, the more capitalist it is. I tried to make this change already but it got reverted. And explanation for that would be welcome.

First of all, the definition there is not an attempt at being a correct definition, so to speak, but at presenting the typical definition of capitalism (and therefore since if it is typical, it is therefore correct). If everyone goes for what they think is intrinsically "correct" it just leads to absurd edit war. Everyone has their own definition which they think makes more sense than the next guy's. While it might make sense what you're saying, it's just that saying private ownership of the means of production is "allowed" is definitely not how it's typically defined. See the definitions of capitalism article for common definitions. As far as including "profit" in the definition, your call is as good as mine in regard to typicality. RJII

Well, definitions of capitalism is down for the moment, but I've personally always learned that captitalism was when the means of production are privately owned. Period. For profit, not-for-profit, has never entered the definition. I agree it might be a connotation, but that's still not part of the definition. 63.98.86.134 21:36, 15 Jun 2005 (UTC)

You can still see the definitions if you do an edit history and a compare. Here you go: [15] RJII 22:00, 15 Jun 2005 (UTC)

I agree with RJII. While there are many "economic systems" (as one could liberally define them) that are not operated "for profit" in a typical capitalist economy, I would argue that the common understanding of "economic system" would include precisely and exclusively the organizations and institutions that are run for profit. Then again, you could just as easily argue that institutions like families are operated for profit, in the sense that they collectively maximize income and minimize costs. Either way, private ownership and operation for profit aren't just allowed in capilaist economies, they are essential (even though some could reasonably disagree about upper bounds of percentages). Mgw 07:01, Jun 15, 2005 (UTC)

"Then again, you could just as easily argue that institutions like families are operated for profit, in the sense that they collectively maximize income and minimize costs."

That would be a different definition of "for profit" than people assume upon reading the phrase.

"Either way, private ownership and operation for profit aren't just allowed in capilaist economies, they are essential (even though some could reasonably disagree about upper bounds of percentages)."

Essential in what way? If you're saying a capitalist economy can't be sustained unless most organizations are run for monetary profit, you're making an argument, which should be distinguished from an NPOV definition of capitalism. If you're saying that it's "not capitalism" unless "most" organizations are run for profit, then you're wrong, as I've shown above. When people refer to capitalist economies they're inevitably referring to economies that had non-profit families, non-profit churches, non-profit bridge clubs, etc. To claim that "real capitalism" involves most organizations being run for monetary profit would be a radical alteration in the way the term has been used.

Market solution

I believe that, in addition to the well-known "exploiting workers" criticism, there was a second critique of capitalism raised by Marxists (I read it in a book of the collected works of Lenin, but it referred to Marx)

This was the claim that, under capitalism, because of the operation of competition, the continually raising quality bar, and the rising costs of business fundamentals resulting from the growth of existing businesses, inevitably production would wind up in the hands of a few companies and any new entrants would have no chance of gaining a foothold. At that point, they argued, free enterprise in that field was effectively dead (after all, if something is guaranteed to fail you can't be considered "free" to do it) and the market was effectively behaving as a socialism.

For example, take Coke. They would argue that the division of the market into Coke and Pepsi, with little or no opportunities for other companies, was an inevitable result, and that that market is effectively now socialised. Furthermore, they argued, an actual socialist economy could therefore run as efficiently as Coke and Pepsi do now: all that would be necessary is for the study of economics and market development to advance sufficiently far that economists could predict in advance how the soft drink market would reach solution under capitalism, and then set up via legislation a socialism that behaved in exactly the same way.

Is this considered somewhere? Have I flown off the handle and gotten mixed up somewhere?

"after all, if something is guaranteed to fail you can't be considered 'free' to do it" -- you can be free to try. Or, central planners can prohibit you from trying because they can decide you inevitably will fail. The first is freedom, the second isn't. Freedom, as Jefferson understood, involved the "pursuit" of happiness. Nobody has the right to get there, only the right to pursue. Sorry. And that's enough to know that central planning is an infringement on the rights of those whose pursuits don't fit into the plan. And, after all, feel free to start your own cola bottling company. I had to say that. Now I'll get off the soapbox. --Christofurio 19:02, Jun 17, 2005 (UTC)

Sorry, I don't agree with that. You might as well argue that you're free to commit murder in the US, because you can shoot someone, you'll just go to jail afterwards. And, starting a new business in many areas is already inevitable, predictable failure, and rather than being decided by "central planners" it's decided by another artifical system, that of capitalism. The fact that there's no individual who you can point to and blame for it doesn't change the morality of the situation. By the way, I shouldn't be anonymous, as I did sign in..

You can agree or disagree as you wish. Starting a cola business is not destined to "inevitable" failure, as the Coke/Pepsi duopoly is far from perfect. Furthermore, even if the duopoly were statistically complete, it would always remain possible that the next entrant would succeed and carve out a niche. No central plan should prohibit that, because this judgment that failure is "inevitable" is not the planner's to make. Your "freedom to murder" example just baffles me. Freedom can mean different things in different contexts, of course, but one important meaning of "freedom to do X" is simply that no agents of a sovereign will be chasing after me trying to punish me if I do X. I have freedom in precisely that respect to open a cola company, as part of my pursuit of happiness. I don't have any right to succeed. By the way, if you want to let us know who you are (without requiring us to use page history) you could simply click the signature button above after writing your graf. --Christofurio 12:54, Jun 23, 2005 (UTC)

You (anonymous user) point out why socialism would be inferior to capitalism. Take the coke and pepsi example: in this case, only two firms compete. We are thus in a situation of a duopoly. As predicted by economics and game theory, the price in a duopoly is much higher than the free-market price. Indeed, Coke and Pepsi use their brand names to ask a higher price than no-name coke brands. If you consider just one firm dominating a market, such as a monopoly (and in a socialist economy there are only monopolies), the price would be even higher. Historically, the example is telecoms, where (at least in Europe) fifteen years ago state monopolies dominated markets and consequently prices were extremely high. With more competition, prices have gone down a lot, and new innovations have been introduced to lure the customers. In the end, the customers were the big gainers. BTW, consolidation usually takes place in very mature industries (e.g. car industry right now), where no big innovations can be made anymore and economies of scale are very big - favouring big companies and mergers and acquisitions. In new industries (e.g. internet, biotech), innovation is still very important and economies of scale not very important. Therefore there's a lot of competition in these industries. Finally, the role of the state is not to work out a way to run companies as efficiently as Coke and Pepsi, but on the contrary to encourage new players and to foster competition. If the state cares for its people (i.e. the customers) it will wish for low prices, and thus have tough anti-trust laws. If the state doesn't care for its people it will encourage mergers of companies to create national champions, and the customers will bear much higher prices. A socialist economy is the extreme of the latter approach. Luis rib 20:10, 18 Jun 2005 (UTC)

Human rights violations, imperialism, and democracy

There is no equivalent section in the socialism and communism articles, despite the fact that socialist and communist regimes have often been as murderous or even more so than capitalist ones (e.g. Gulags, Great Leap Forward). Do we need to do some rebalancing here? 195.92.40.49 12:42, 23 Jun 2005 (UTC)

Social capitalism

I didn't really see anything about social capitalism in here. Increasingly people are using ideas from the west such as efficiency in an effort to generate profit - but not for profits sake but to maximally help people.

For example, Dr. V of India was impressed by McDonald's efficency at serving food and then applied the idea to the case of cataract surgery. Dr. V's mission is to maximize profit to enable him to offer more services free of charge. Thus profit is a means to an end (helping people) instead of an end in itself as it tends to be in 'traditional' capitalism.

Is anyone aware of this idea? Is there a better term for it, I believe in the documentary that I linked to above on PBS it was also refered to as spiritual capitalism or compassionate capitalism. --ShaunMacPherson 30 June 2005 05:16 (UTC)

"Profit" means an improvement in a person's life. It is the same thing as "helping people", so this "social capitalism" is incoherent. I guess that doesn't mean it shouldn't be described in the article, supposing it is well-sourced. - Nat Krause 30 June 2005 06:18 (UTC)

Your explanation is an obvious non-sequitir. The category of profit in capitalism reflects private benefits realized after private costs have been accounted for, it does not follow that in capitalism marginal costs and benefits from the perspective of the individual unit of capital necessarily reflect marginal social costs and benefits. In fact market capitalism has a decidedly anti-social bias. Competitive pressures drive producers to "take advantage of external effects in socially counterproductive ways and even to create new ones...manouvering to appropriate a greater share of goods and services produced by externalizing costs and internalizing benefits without compensation are always ways to increase profits. Competitive pressures will drive producers to puruse this route to profitability just as assiduously."(Robin Hahnel, The ABC's of Political Economy) For "compassionate capitalism", or whatever, perhaps the book you are looking for is William Greider's "The Soul of Capitalism." Although Greider's prescriptions to save capitalism are not socialist, they will seem extreme relative to the perspective of the current economic and political establishment, and their worshippers. "Compassionate capitalism" was experimented with during the era of welfare states and mild liberal social democracies. These experiments were failures in the sense that they could not be sustained and did not follow through on their promises. Social democrats tend to blame the right for these failures while never even considering that their own elitist attitudes and policies might have contributed significantly to the vulnerability of these structures.