1. Post #441
    Dennab
    March 2012
    867 Posts
    Why the so-called "Communist" countries of the 20th century failed, and why they ought not be considered as evidence against marxism/communism/socialism.

    No doubt we've all heard people say "the USSR was not communist" in retaliation to opponents decrying communism on the basis of totalitarianism. That's an entire different discussion on its own, but what would Marx have to say about this topic?

    The first thing you need to know about Marx is that he wasn't some anti-capitalist hippie who opposed modern society and owning things. Nobody admired the creations of capitalism more so than Karl Marx. Marx's critique of capitalism (and society in general under that banner of capitalism) was generally scientific, rather than ethical. Marx stated that the cause for a shift in economic mode of production (the various forms of an economy that we know as capitalism, socialism, communism, feudalism, etc.) was a shift in the means of production (the tools used to produce a commodity, such as the steam engine, the spinning jenny, etc.). Each time that the means of production improved, the economy (and consequently, society as a whole) who advance to meet this new way of creating and producing. Generally, when the means of production improved, a more liberal restructuring of society came along with it, or vice-versa. With the improving means of production also came improved means of communication, improved transportation, greater commercial activity, and through this: spreading ideas of democracy. The result of this was the enlightenment, and the result of THIS was widespread political upheaval against the monarchies and religious aristocracies of the previous centuries. The relationship between commerce and liberalism is best illustrated through this map of the salem witch trials:



    We see that the west village did the accusing while the east village played the role of the accused. The west village, which was further away from seaports (and therefore commerce) held more conservative values. Around this time, women had been granted the right to inherit property, church attendence was decreasing (which resulted in lowered standards for membership), and society as it was when salem was first founded was being shaken. The conflict between the older west village and the newer east village resulted in the west village accusing women who came into ownership of their deceased fathers' property of witchcraft (one could draw parallels to this and McCarthyism).

    It stands to reason, then, that improved means of production (which include the means of communication and transportation, as these are used in production) result in the spread of democratic ideas. It was only natural, then that the industrial revolution, urbanization, and the rise of advanced capitalism follow the revolutions and civil wars of the 17th and 18th centuries, carrying into the early 19th century. The ability to produce more of a needed product with less work meant that the individual needed less guidance than before, and the authority of the monarch and the church broke down in favor for the authority of the economy.

    To dive further into this idea of organization vs. appropriation, look to the fall of rome. After the fall of rome, there was a massive loss of organization in europe and the middle east. Commerce skidded to a halt, communication was silenced, and everything stood still. The Library of Alexandria was lost, hundreds of years of civilization erased, and individuals were forced to collect themselves into smaller, feudal groups. With the loss of the means of production of rome came a less centralized, religiously controlled feudal system with very low standards of individual freedom. Upon recovery through economic means, the feudal system of lords and serfs fell to capitalism, and the less centralized lords became the monarchies of europe.

    The common element we see is the ability to appropriate resources efficiently. In pre-historic times, the ability to collect food and other resources was so limited that society had to be organized into tightly-knit hunter-gatherer tribes in which an individual's attempts at personal liberty were met with religious backlash or that individual's failure to gather the required resources for himself. as the ability to appropriate resources became easier, population would increase, tribes would enter into association, nations would be formed, and individual freedom increased ever so gradually. The tribal leader became the king or lord, and the tribal shaman became the priest or pope.

    So how does this connect to capitalism? In the 19th century, the unlimited forces of free market capitalism resulted constantly in overproduction. Overproduction was a result of the means of production being improved to the point where efficiency had overcome necessity, and the market becomes saturated. If, for example, all the farms and farming corporations in the country produce as much food as they possibly can to maximize profit, then the means of production will get to a point where they will produce so much food that, in combination with all other farms and farming corporations, they will produce more food than is needed to be consumed. Even though food is a perishable product, overproduction will repeat itself next harvest because the means of production will only improve. Take a nonperishable product, for example (a widget). There is demand for Widgets, so the factory owner produces them. However, other factory owners also produced widgets to try to compete with one-another, and they produce so many widgets that the supply is now greater than the demand, and the product is now nearly worthless. The factory owner will stop production until he can sell off his stockpile of widgets. To stop production, the factory owner must fire X workers and close X factories. After the factory owner sells his stockpile, he re-opens his factories and starts producing more widgets. The problem is so has every other factory owner, and overproduction happens again. This cycle is described by Marx as "boom and bust", and is the prime characteristic of capitalism outgrowing itself. Just as every other economic mode of production and organization of society was outdone by improved means of production, so will, marx argues, capitalism. Taking the overproduction of food, for example, and applying saturation of the market to it, the value of all economic factors drop with such an overproductive bubble. An unemployed family goes hunry at night, and one child asks his father "Dad, why don't we have anything to eat?", to which the father replies "because there is too much food". At this point, the means of production, and the organization of capitalism have come into conflict and must result in the change of one or the other.

    hopefully I haven't lost you because here is the central point: Communism/socialism rely on the ability for the market to overproduce. The fact that there is plenty of food to go around result, logically, in questioning why we have to appropriate our resources by the direction of the capitalist. If there is more food than we know what to do with, why do we need direction in appropriating it like we did when there WASNT enough food to go around back in feudalism, or the tribal days? Why do we recognize the authority of money when there is so much food that it's literally worthless, and we could just give it away and there would still be too much? in fact, why DONT we just give it away?

    Because of the bourgeois, thats why. The only thing keeping us from feeding every person in the country is these aristocratic fucks who only want more money for themselves, just like the monarchs that we overthrew a hundred years ago, just like the pope who we stopped listening to a while ago, just like everybody else who told us what to do years before.

    Here's where we tie it all together: Russia was nowhere near the point of over-production in 1917. Russia was made up of a lot of rural peasantry, and serfdom was abolished in russian only about 50 years prior, whereas serfdom had died out in england in the 15th-16th centuries (Philip Iv, Louis X, and Philip V had de facto ended serfdom in the very early 14th century, and had ceased to exist in france by the 15th century. serfdom was rare in western europe but grew in eastern europe after the renaissance). Russia was nowhere near the ability to, as an entire empire, overproduce products to the point of saturation. As for 3rd world/colonial countries like China, Vietnam, Korea, Cambodia, and the rest of eastern europe, africa, latin america, and the middle east, it needs little explaination as to the state of economics in each region and how close they were to surplus manufacturing.

    The result of forced collectivization in countries that aren't economically "ripe" for communism/socialism results in either a semi-democratically run, but completely innefficient beauracracy (Lenin's USSR) or a totalitarian hellhole which appropriates resources at a very high death rate (Stalin's Russia, Mao's China, Kim's North Korea, and above all other examples: Pol Pot's Cambodia.)

    Marx envisioned the revolution to take place in western europe in countries like France, Germany, or England. The failures thereof are an entirely different matter which I can go into at a later date.

  2. Post #442
    fox '09's Avatar
    July 2010
    1,291 Posts
    False choice if you ask me. I like capitalism, but it shouldn't be applied to everything. I don't think people should be forced to pay or die. Life should be a right, and that includes healthcare. a mixed capitalist-socialist system seems to be the right way to go.

    edit:
    Great read above, thanks for your effort.

  3. Post #443
    Gold Member
    [Seed Eater]'s Avatar
    July 2011
    5,582 Posts
    Very good read and very true, prooboo.

  4. Post #444
    SuperElektrik's Avatar
    April 2012
    41 Posts
    Capitalism. Everyone should be able to conduct business the way they want to and be successful. Just think, if we had to have 15 permits filled out to open a lemonade stand.. oh wait...

  5. Post #445
    Gold Member
    [Seed Eater]'s Avatar
    July 2011
    5,582 Posts
    Capitalism. Everyone should be able to conduct business the way they want to and be successful. Just think, if we had to have 15 permits filled out to open a lemonade stand.. oh wait...
    Implying that capitalism provides more economic freedom than worker self management.

  6. Post #446
    Derubermensch's Avatar
    August 2009
    1,261 Posts
    I don't necessarily agree with you. And I am very much against unfree markets. But this rationally delivered explanation was very refreshing.

  7. Post #447
    Dennab
    March 2012
    867 Posts
    I don't necessarily agree with you. And I am very much against unfree markets. But this rationally delivered explanation was very refreshing.
    The thing about communism is that it's not an unfree market, it's simply a different mode of production. Communism doesnt demonize personal wealth, but instead states that the business model of capitalism requires a level of greed that is destructive in its means. Communism is a mode of production in which the owners of the means of production are the ones who USE the means of production. In this way, the means of production are ultimately used to produce products rather than produce profit. Because of this, production is transitive to necessity and unemployment coincides with surplus.

  8. Post #448
    Derubermensch's Avatar
    August 2009
    1,261 Posts
    The thing about communism is that it's not an unfree market, it's simply a different mode of production. Communism doesnt demonize personal wealth, but instead states that the business model of capitalism requires a level of greed that is destructive in its means. Communism is a mode of production in which the owners of the means of production are the ones who USE the means of production. In this way, the means of production are ultimately used to produce products rather than produce profit. Because of this, production is transitive to necessity and unemployment coincides with surplus.
    In a perfect world this is how an economy would naturally work. However, this is not the case. Ultimately monetary incentive, which spawns labor management, promotes the most efficient possible mode of production. Any attempt to use any means contrary to that of the traditional free market would involve constant coercion, as human nature simply doesn't change. Therefore, in theory, the original communist ideal would be a free market. In practice, however, attempts at communism can only end up as police states or eventually morph into traditional free economies.

  9. Post #449
    J$ Psychotic's Avatar
    April 2011
    1,338 Posts
    Capitalism is peaceful and allows some members to become super-rich, but thrives off of individuality, not teamwork on a broad scale, in a sense depreciating the value of the country as compared to where everyone could work together and achieve more, and also allows some members to become super-poor.

    Communism calls for the overthrow of Capitalism everywhere and will prevent economic inequality, but utilizes a team environment across an entire country to make it more productive, and gives a brain surgeon who is earning the salary of a ditch digger no incentive to work harder.

    Capitalism is risky compared to the stability offered by Communism, but Capitalism gives a bigger chance of a huge payoff while Communism prevents economic hardships better than Capitalism.

    Goods and bads all across the spectrum. Make your choice.

       Communist Democracy is best democracy   

  10. Post #450
    Gold Member
    [Seed Eater]'s Avatar
    July 2011
    5,582 Posts
    Capitalism is peaceful and allows some members to become super-rich, but thrives off of individuality, not teamwork on a broad scale, in a sense depreciating the value of the country as compared to where everyone could work together and achieve more, and also allows some members to become super-poor.

    Communism calls for the overthrow of Capitalism everywhere and will prevent economic inequality, but utilizes a team environment across an entire country to make it more productive, and gives a brain surgeon who is earning the salary of a ditch digger no incentive to work harder.

    Capitalism is risky compared to the stability offered by Communism, but Capitalism gives a bigger chance of a huge payoff while Communism prevents economic hardships better than Capitalism.

    Goods and bads all across the spectrum. Make your choice.

       Communist Democracy is best democracy   
    Wait, no one has ever advocated for equal wage sin communism. A brain surgeon would never be purposefully paid equal to a ditch digger. That's a common misconception (prevalent in people who don't know about communism).

    And capitalism only gives chances of a huge payoff to those who exploit or control. You can still get rich in a worker self-management free market, but socialism makes sure you can't get too poor, and the self-management makes sure that that money can't be used to profit or exploit. Economic inequality isn't the issue, economic exploitation and economic slavery is. As long as there is no slavery, hunger, poverty, and exploitation, then you can make loads of money in a communist system.

  11. Post #451
    Derubermensch's Avatar
    August 2009
    1,261 Posts
    Capitalism is peaceful and allows some members to become super-rich, but thrives off of individuality, not teamwork on a broad scale, in a sense depreciating the value of the country as compared to where everyone could work together and achieve more, and also allows some members to become super-poor.

    Communism calls for the overthrow of Capitalism everywhere and will prevent economic inequality, but utilizes a team environment across an entire country to make it more productive, and gives a brain surgeon who is earning the salary of a ditch digger no incentive to work harder.

    Capitalism is risky compared to the stability offered by Communism, but Capitalism gives a bigger chance of a huge payoff while Communism prevents economic hardships better than Capitalism.

    Goods and bads all across the spectrum. Make your choice.

       Communist Democracy is best democracy   
    First off, a democratic society that seeks to have pure socialism will ultimately fail. Self interest and how it dictates into highly centralized power would all but indicate that eventually voters would just create a gigantic pseudo-corporatistic system (like how the USA has become to morph after a century of the federal government being given so much power over the economy), or that it would eventually evolve into a capitalistic society (Russia after glasnost and perestroika). Anyone who thinks that a democratic process would guarantee a socialist society is delusional. Socialism can only be achieved through coercive processes, and no human government can guarantee such proper and intended usage of coercive powers.

  12. Post #452
    Azaer's Avatar
    November 2010
    560 Posts
    Communism tries to create a social utopia assuming the people are capable of one. But if the people are all capable of functioning a utopia, then the government systems is obsolete.

    Capitalism works just because its a self-sustaining system. Communism from a standpoint of ethics is in reality more appealing, but when practicality comes around, Communism has had a history of breaking down into a totalitarian state because, sadly, no one is ready for a utopia.

  13. Post #453
    Dennab
    March 2012
    867 Posts
    In a perfect world this is how an economy would naturally work. However, this is not the case. Ultimately monetary incentive, which spawns labor management, promotes the most efficient possible mode of production. Any attempt to use any means contrary to that of the traditional free market would involve constant coercion, as human nature simply doesn't change. Therefore, in theory, the original communist ideal would be a free market. In practice, however, attempts at communism can only end up as police states or eventually morph into traditional free economies.
    Well monetary incentive does promote maximum efficiency in capitalism, but that's exactly the problem. Maximum efficiency in an unregulated market results in overproduction and market saturation. Regulation results in globalism/imperialism.

  14. Post #454
    Derubermensch's Avatar
    August 2009
    1,261 Posts
    Well monetary incentive does promote maximum efficiency in capitalism, but that's exactly the problem. Maximum efficiency in an unregulated market results in overproduction and market saturation. Regulation results in globalism/imperialism.
    Not necessarily: given a few decades, a free-market economy would only have as much supply as there is demand. And market saturation isn't necessarily a bad thing. At least then stability and long-term growth are guaranteed. Overproduction wouldn't be a problem in a free market because you can't have overproduction without overinvestment. Overinvestment can realistically only result from things like government subsidies, artificially low interest rates, inflation, etc.

  15. Post #455
    Dennab
    March 2012
    867 Posts
    Not necessarily: given a few decades, a free-market economy would only have as much supply as there is demand. And market saturation isn't necessarily a bad thing. At least then stability and long-term growth are guaranteed. Overproduction wouldn't be a problem in a free market because you can't have overproduction without overinvestment. Overinvestment can realistically only result from things like government subsidies, artificially low interest rates, inflation, etc.
    Overinvestment occurs naturally in economic bubbles and when the means of production have been developed to a point of surplus and the collective forces of the economy are producing enough to satisfy their own needs on an individual basis but collectively saturate the market. Improvements in technology and rising levels of productivity increase the amount of material wealth in society while simultaneously diminishing the economic value of this wealth, thereby lowering the rate of profit - a tendency that leads to the paradox, characteristic of crises in capitalism, of “poverty in the midst of plenty,” or more precisely, crises of overproduction in the midst of underconsumption. Overproduction IS necesarrily a bad thing because it results in a cycle of massive production followed by massive unemployment.

  16. Post #456
    Gold Member

    May 2005
    2,268 Posts
    I have to say I came in here very skeptical of communism but have changed my opinion. After reading the thread it seems that people supporting capitalism keep rehashing the same arguments of "it sounds nice on paper but doesn't work in reality" , "it's just human nature", and "it's a utopia". I think the people supporting communism have adequately dealt with these claims already and it's disappointing to see these same claims repeated endlessly in here.

  17. Post #457
    Gold Member

    February 2006
    2,990 Posts
    Overproduction wouldn't be a problem in a free market because you can't have overproduction without overinvestment. Overinvestment can realistically only result from things like government subsidies, artificially low interest rates, inflation, etc.
    'Overinvestment' is a relative term that merely reflects the falling rate of profit, that doesn't help us understand anything, let alone convince anybody 'it's not a problem'. It's like a very, very late warning.

    Free markets would be the most vulnerable to overproduction and a falling rate of profit, which would ultimately correct itself in a destructive deflationary cycle and simultaneously evoking a fierce friction with its true constituents, labor. This is where libertarianism/anarcho-capitalism fades into irrelevance as the capitalist state tries its hardest to restore the rate of profit and subdue the class struggle through welfarist concessions to workers. That is presuming it doesn't fall to revolutionary workers, or worse, capitulates to fascists.

    From there we arrive to the modern liberal state, and with it a system far better equipped to maintain capitalism than the libertarians' and whatever monstrosity 'anarcho-capitalists' produce.

  18. Post #458
    Derubermensch's Avatar
    August 2009
    1,261 Posts
    Overinvestment occurs naturally in economic bubbles and when the means of production have been developed to a point of surplus and the collective forces of the economy are producing enough to satisfy their own needs on an individual basis but collectively saturate the market. Improvements in technology and rising levels of productivity increase the amount of material wealth in society while simultaneously diminishing the economic value of this wealth, thereby lowering the rate of profit - a tendency that leads to the paradox, characteristic of crises in capitalism, of “poverty in the midst of plenty,” or more precisely, crises of overproduction in the midst of underconsumption. Overproduction IS necesarrily a bad thing because it results in a cycle of massive production followed by massive unemployment.
    Note: It would be wrong to use any time period of the last century-and-a-half as a citation on the failures of capitalism, because a scientific analysis of capitalism has been sullied by government tampering of money and production to the point that we can only work on a theoretical basis.
    Such changes in the economy, such as surplus and overproductivity, can't really happen, such imbalances would happen so slowly and mildly that the economy would be able to "do the tango" with such changes.
    You would be making a mistake in assuming economic bubbles are natural to an economy. People wouldn't partake in deals and practices bound to fail out of self interest. The reason we get bubbles is because of government incentives that encourage people to make self-destructive decisions.

  19. Post #459
    Dennab
    March 2012
    867 Posts
    Note: It would be wrong to use any time period of the last century-and-a-half as a citation on the failures of capitalism, because a scientific analysis of capitalism has been sullied by government tampering of money and production to the point that we can only work on a theoretical basis.
    Such changes in the economy, such as surplus and overproductivity, can't really happen, such imbalances would happen so slowly and mildly that the economy would be able to "do the tango" with such changes.
    You would be making a mistake in assuming economic bubbles are natural to an economy. People wouldn't partake in deals and practices bound to fail out of self interest. The reason we get bubbles is because of government incentives that encourage people to make self-destructive decisions.
    Counternote: we live in a capitalist mode of production, so using evidence from the past century and a half is completely okay. Even then, The US was largely Laissez-faire for the 20's and the 19th century

    examples of economic bubbles in capitalism:

    http://en.wikipedia.org/wiki/Tulip_mania
    http://en.wikipedia.org/wiki/South_Sea_Company
    http://en.wikipedia.org/wiki/Mississ...issippi_Bubble
    http://en.wikipedia.org/wiki/Railway_Mania
    http://en.wikipedia.org/wiki/Encilhamento
    http://en.wikipedia.org/wiki/Florida...m_of_the_1920s
    http://en.wikipedia.org/wiki/Great_Depression
    http://en.wikipedia.org/wiki/Panic_of_1893 classic example of overproduction and speculation: overproduction of crops and silver

  20. Post #460
    Gold Member
    [Seed Eater]'s Avatar
    July 2011
    5,582 Posts
    Welp, I'm out of this at this point. My moral positions are no longer needed, we have the economic professors here.

  21. Post #461
    Dennab
    March 2012
    867 Posts
    Welp, I'm out of this at this point. My moral positions are no longer needed, we have the economic professors here.
    I would hardly consider myself a professor .__.

  22. Post #462
    Gold Member
    [Seed Eater]'s Avatar
    July 2011
    5,582 Posts
    I would hardly consider myself a professor .__.
    Compared to me. I know a fair bit compared to the average joe, but I've always lacked in economics. Hence my leaning towards political science. I can argue politics quite a fair bit, but the economic aspects of leftism is not my strong suite. I know very vague basics, which is a real weakness.

  23. Post #463
    Derubermensch's Avatar
    August 2009
    1,261 Posts
    Welp, I'm out of this at this point. My moral positions are no longer needed, we have the economic professors here.
    You're being incredibly generous ... for me, at least.

    Edited:

    Counternote: we live in a capitalist mode of production, so using evidence from the past century and a half is completely okay. Even then, The US was largely Laissez-faire for the 20's and the 19th century

    examples of economic bubbles in capitalism:

    http://en.wikipedia.org/wiki/Tulip_mania
    http://en.wikipedia.org/wiki/South_Sea_Company
    http://en.wikipedia.org/wiki/Mississ...issippi_Bubble
    http://en.wikipedia.org/wiki/Railway_Mania
    http://en.wikipedia.org/wiki/Encilhamento
    http://en.wikipedia.org/wiki/Florida...m_of_the_1920s
    http://en.wikipedia.org/wiki/Great_Depression
    http://en.wikipedia.org/wiki/Panic_of_1893 classic example of overproduction and speculation: overproduction of crops and silver
    We do not live in a free market system. The 1920s is and the great depression are not citable for the faults of capitalism. Those were financial failures, and we have a centralized finance and banking system; it was the federal reserve that created those bubbles. The Panic of 1893 isn't a valid example because it was the result of the tampering of monetary policy and silver coinage. Railway Mania was encouraged by the Bank of England artificially cutting interest rates and incentivizing risky investment.


    I could go on and on, but the point is that these bubbles were the result of poor finance and money, not for reasons inherent to a free market economy.

  24. Post #464

    August 2011
    285 Posts
    We do not live in a free market system. The 1920s is and the great depression are not citable for the faults of capitalism. Those were financial failures, and we have a centralized finance and banking system; it was the federal reserve that created those bubbles. The Panic of 1893 isn't a valid example because it was the result of the tampering of monetary policy and silver coinage. Railway Mania was encouraged by the Bank of England artificially cutting interest rates and incentivizing risky investment.


    I could go on and on, but the point is that these bubbles were the result of poor finance and money, not for reasons inherent to a free market economy.
    Although there are many factors which may cause bubbles, the fact remains that individual investors made bad decisions and bought into them. Surely, if there are terrible financial products then investors should realise that they are risky and not buy into them?

    So long as individuals are capable of making poor decisions then bubbles, crashes and meltdowns are still going to happen. People often cite 'human nature' as a reason why Communism fails (which is false anyway) but I could also cite 'human nature' as a reason why Capitalism fails.

    Completely 'free' markets assume that individuals are isolated entities and that their terrible decisions do not affect everyone else. A factory owner may decide to invest in a risky business venture, lose and go bankrupt. That is fine because it is his decision but his poor judgement then affects the lives of the workers at his factory. A bank CEO may riskily invest depositors money, lose and cause the economy to near-collapse.

    In a nut-shell: financial bubbles/crashes are inherent to a free market economy because of the role individuals play in the markets and the amount of power and influence they have. Poor individual decisions have the potential to affect many more lives than their own. If an individual can set up a pyramid scheme for his benefit then he will do so etc.

    (This is just one approach to explaining bubbles; there are many others. I just decided to take a more theoretical approach and it is not particularly detailed since I want people to read it and not just skip over it.)

    People wouldn't partake in deals and practices bound to fail out of self interest. The reason we get bubbles is because of government incentives that encourage people to make self-destructive decisions.
    You perhaps unwittingly provided evidence for my argument.

    Governments, advertising agencies and businesses may 'encourage' people to make risky decisions but the choice whether to invest rests solely on the individual. Individuals are not infallible entities and thus they will make economic decisions which are not in their interest.

    Advertising cannot work in a free market nor can information failure be cured without it (thus a paradox).

  25. Post #465
    Derubermensch's Avatar
    August 2009
    1,261 Posts
    Although there are many factors which may cause bubbles, the fact remains that individual investors made bad decisions and bought into them. Surely, if there are terrible financial products then investors should realise that they are risky and not buy into them?

    So long as individuals are capable of making poor decisions then bubbles, crashes and meltdowns are still going to happen. People often cite 'human nature' as a reason why Communism fails (which is false anyway) but I could also cite 'human nature' as a reason why Capitalism fails.

    Completely 'free' markets assume that individuals are isolated entities and that their terrible decisions do not affect everyone else. A factory owner may decide to invest in a risky business venture, lose and go bankrupt. That is fine because it is his decision but his poor judgement then affects the lives of the workers at his factory. A bank CEO may riskily invest depositors money, lose and cause the economy to near-collapse.

    In a nut-shell: financial bubbles/crashes are inherent to a free market economy because of the role individuals play in the markets and the amount of power and influence they have. Poor individual decisions have the potential to affect many more lives than their own. If an individual can set up a pyramid scheme for his benefit then he will do so etc.

    (This is just one approach to explaining bubbles; there are many others. I just decided to take a more theoretical approach and it is not particularly detailed since I want people to read it and not just skip over it.)



    You perhaps unwittingly provided evidence for my argument.

    Governments, advertising agencies and businesses may 'encourage' people to make risky decisions but the choice whether to invest rests solely on the individual. Individuals are not infallible entities and thus they will make economic decisions which are not in their interest.

    Advertising cannot work in a free market nor can information failure be cured without it (thus a paradox).
    What you are citing is that people have free will. But the government's, or rather, the federal reserve's, coercive monopoly of finance caused people to make these self-destructive decisions. But you are discounting the fact that a central finance and banking system has no place in a free market system. If we had decentralized, privatized banking and interest rates were allowed to shift to their market equilibrium level (which is the free market aspect of banking) then we wouldn't have had these bubbles because they would have been impossible to make. The kind of power the FED has would be alien to banks in free-market finance.

  26. Post #466
    Torjuz's Avatar
    January 2011
    3,740 Posts
    Long time since I checked this thread. Great post Prooboo, I'll quote you and your fantastic post in the op

  27. Post #467
    Dennab
    January 2012
    953 Posts
    Marxism is the way to go for Socialist societies.
    People are just too greedy with power to understand that the people need loving too and aren't drones to society.

  28. Post #468
    Gold Member
    [Seed Eater]'s Avatar
    July 2011
    5,582 Posts
    Marxism is the way to go for Socialist societies.
    People are just too greedy with power to understand that the people need loving too and aren't drones to society.
    But...Marxism has little to do with love and such. It's all scientific. Many Marxists were very utilitarian and cared very little for abstract concepts, like the sanctity of human life or love or whatever.

  29. Post #469
    Gold Member

    February 2006
    2,990 Posts
    Who said marxism has little to do with love, surely you have not heard the stories of lustful east german women?

  30. Post #470
    gay mexican
    Lankist's Avatar
    July 2006
    14,576 Posts
    There is no "best." They are not parallels.

    Communism is the theoretical end-point of government over a very long period of societal evolution.

    It roughly goes:

    Feudalism -> Capitalism -> Socialism -> Communism

    Feudalism establishes the cultural traditions and solidarity of a society, which initially brings them together under the same banner.

    Capitalism establishes the infrastructure for mass-manufacturing, housing, etc.

    Socialism establishes abundance of resources, necessities and welfare systems by using and improving the previously established infrastructure.

    Communism unites the society under a banner of the common good.


    You cannot have a successful communist society without having gone through the previous stages of government. You need the solidarity created by the feudal systems. You need the infrastructure established by the free-market. You need the abundance and welfare systems from Socialism. You cannot just skip the middle steps or your people are going to fucking starve.

    Trying to compare Communism to Capitalism is like trying to compare a neanderthal to an astronaut. They aren't parallel, and that astronaut wouldn't have shit if neanderthal no learn make fire.

    The question isn't "which is better." Communism is better on a theoretical level, though its real-world implementation in some distant future would likely be quite different from original Marxist theory. The real question is "is our society ready and capable to move forward?" Given we still struggle with poverty and starvation on a logistical level, the answer is no. Our capitalist infrastructure is still too underdeveloped to dive completely into socialism (though we CAN start blending the two at this point.) We still need investment in manufacturing, farming and technology. Governments only invest based upon necessity. Businessmen invest based upon greed and wealth. And there's a lot more shit we develop because we can sell it than shit we develop because we need it.

    Edited:

    For instance, let's say we jump to communism today.

    Communism relies upon abundance. Shit is not very abundant right now. We don't have much fuel left, and we haven't developed any feasibly effective alternative fuels. Pretty quickly, once we start trying to provide for everyone equally, we're going to run right the fuck out of fuel. Transportation suffers, which means it'll be that much more difficult to farm. It'll also be nigh-impossible to distribute whatever food we DO have to everyone evenly. Our manufacturing industry will crash, and any abundances we have right now that were dependent upon that fuel source (i.e. all of them) will rapidly become scarcities. People will start starving. Riots will break out. Violence will ensue. And we'll either return to a damaged and even less-developed Capitalist society, our we'll descend into chaos.

  31. Post #471
    Gold Member

    February 2006
    2,990 Posts
    For instance, let's say we jump to communism today.
    Who's we exactly? The world? The US?

  32. Post #472
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    Lankist's Avatar
    July 2006
    14,576 Posts
    Who's we exactly? The world? The US?
    Anyone or everyone. The fuel concern used in that example is global, and any sufficiently populous society will suffer its effects if it has not been addressed before attempting abundance.

    Small populations do not qualify as viable examples. A commune consisting of two dozen subsisting for themselves is not a communist society, it is a communal group.

  33. Post #473
    Gold Member

    May 2005
    2,268 Posts
    How is communism going to tell us what goods will be the most economical to make, and the most economical ways to make them, just out of curiosity? In capitalism, profit seems to do that job pretty well.

  34. Post #474
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    Lankist's Avatar
    July 2006
    14,576 Posts
    It's not. That's why it requires abundance. You need enough of everything to meet a dynamically changing set of demands. If you don't have enough of one particular thing, the moment the demand becomes greater than the supply you're fucked. Infrastructure can certainly be improved in a communist society. But, as I said, governments only invest based upon necessity, and not upon want or profit. For instance, right now the US is completely fucking disinterested in doing anything spacey with NASA. "Oh, we might do a mars mission in twenty years, maybe, or something." And what's happening in the meantime? The private sector is attempting to develop an ASTEROID MINING program (which is dope as hell). You could only expect NASA to jump back into that frontier if, say, China decides to build a military base on the moon. If they so much as say that, we'll be back on the moon by the end of next week. Until such a point, however, the government will only invest in the technologies it NEEDS.

    Even more NASA: Why did we go to the moon in the first place? Because the Russians beat us into space, and they were thinking about sending some dudes down there themselves. So we buckled the fuck up and blasted twelve different people to the surface of the moon over nine years, because we felt threatened.

    i.e. Star Trek communism is completely dependent upon replenishable and recyclable resources (replicators). Everything the replicators go down (like twice a week) everything turns to anarchic shit.

  35. Post #475
    Zerohe's Avatar
    May 2012
    316 Posts
    That was one of the best things I have read in a long time. I've always argued that no matter what, if the human race survives long enough we will eventually be universally communist as default post-scarcity; after we master matter replication and nuclear fusion and things similar to that. We get too caught up in left vs right, red vs blue, freedumz vs regulation, when we should be arguing when we should be implementing each of them.

  36. Post #476
    GenPol's Avatar
    June 2012
    546 Posts
    How is communism going to tell us what goods will be the most economical to make, and the most economical ways to make them, just out of curiosity? In capitalism, profit seems to do that job pretty well.
    There's no justification for the capitalistic profit maximizing production quota. It makes the economy function below its potential.

    In a capitalistic system, the production quota is set at the point which maximizes the total profits, or L = max{q | TR(q) - TC(q)}. This doesn't lead to a maximal quantity produced using the available funds for reinvestment, due to the nature of total profit curves. An enterprise could still self-sufficiently produce at a quantity level superior to L, by redirecting its funds to the capital accumulation, increasing its labor inputs, and so on.

    Not to mention, the most essential items, as voted by the general population, would receive additional funding from the planning center for their production, which would make them far more abundant by producing so much that their production process would become unprofitable.

    The production quota in a rational and non-capitalist system would be set entirely by the relationship between these main variables: The production quota interval which leads to profitable production, and the essentiality of the item being produced. The most essential items, and items which lead to huge utility increases would be overproduced (produced above the profitable interval), and non-essential items would be produced within the profitable interval to cover the additional costs of overproducing essential items.

    This would most likely reduce the unemployment levels, lead to a higher economic growth and quality of life.

  37. Post #477
    Gold Member

    May 2005
    2,268 Posts
    There's no justification for the capitalistic profit maximizing production quota. It makes the economy function below its potential.

    In a capitalistic system, the production quota is set at the point which maximizes the total profits, or L = max{q | TR(q) - TC(q)}. This doesn't lead to a maximal quantity produced using the available funds for reinvestment, due to the nature of total profit curves. An enterprise could still self-sufficiently produce at a quantity level superior to L, by redirecting its funds to the capital accumulation, increasing its labor inputs, and so on.

    Not to mention, the most essential items, as voted by the general population, would receive additional funding from the planning center for their production, which would make them far more abundant by producing so much that their production process would become unprofitable.

    The production quota in a rational and non-capitalist system would be set entirely by the relationship between these main variables: The production quota interval which leads to profitable production, and the essentiality of the item being produced. The most essential items, and items which lead to huge utility increases would be overproduced (produced above the profitable interval), and non-essential items would be produced within the profitable interval to cover the additional costs of overproducing essential items.

    This would most likely reduce the unemployment levels, lead to a higher economic growth and quality of life.
    That doesn't motivate risk taking and the technological progress that comes along with it. It will reduce the unemployment levels, that is true. The USSR and China tried your planned economy idea already, it resulted in millions of people dying of starvation as a result of forced collectivization with production quotas. They couldn't meet the government's production quota for grain and died because they didn't have enough to feed themselves. They had to give away everything they harvested. If they were caught hiding a small amount of food for themselves, they were subjected to atrocious punishment or execution.

    What those countries had and what North Korea has now is not anywhere close to my ideal quality of life. It will result in a lack of freedoms (private property, ability to take an innovative idea and start your own business), a lack of choices, and has historically resulted in disaster and atrocities. It will result in the lack of risk-taking innovative ideas, the lack of technological progress, and a loss of individuality by forced collectivization. It will result in inefficiency and waste. It will result concentrating too much power in the hands the state, and will result in oppression. You will not be free do to as you want, you will be enslaved into doing what other people tell you to do. This does not happen under free-market capitalism. Companies are not free to exploit your labor by force because they're voluntary agreements and other companies would compete for employees by offering better wages and working conditions than the competition. It's capitalism that results in higher economic growth and quality of life, both in theory and historically, by maximizing individual liberties and providing an incentive (profit) to invest in new and innovative things, and to cut inefficiency and waste.

  38. Post #478
    GenPol's Avatar
    June 2012
    546 Posts
    That doesn't motivate risk taking and the technological progress that comes along with it. It will reduce the unemployment levels, that is true. The USSR and China tried your planned economy idea already, it resulted in millions of people dying of starvation as a result of forced collectivization with production quotas. They couldn't meet the government's production quota for grain and died because they didn't have enough to feed themselves. They had to give away everything they harvested. If they were caught hiding a small amount of food for themselves, they were subjected to atrocious punishment or execution.

    What those countries had and what North Korea has now is not anywhere close to my ideal quality of life. It will result in a lack of freedoms (private property, ability to take an innovative idea and start your own business), a lack of choices, and has historically resulted in disaster and atrocities. It will result in the lack of risk-taking innovative ideas, the lack of technological progress, and a loss of individuality by forced collectivization. It will result in inefficiency and waste. It will result concentrating too much power in the hands the state, and will result in oppression. You will not be free do to as you want, you will be enslaved into doing what other people tell you to do. This does not happen under free-market capitalism. Companies are not free to exploit your labor by force because they're voluntary agreements and other companies would compete for employees by offering better wages and working conditions than the competition. It's capitalism that results in higher economic growth and quality of life, both in theory and historically, by maximizing individual liberties and providing an incentive (profit) to invest in new and innovative things, and to cut inefficiency and waste.
    "That doesn't motivate risk taking and the technological progress that comes along with it." - What doesn't? Production for the sake of fulfilling human needs, and producing maximal quantities? Higher investment in total factor productivity and increasing the capital to labor elasticity of substitution could be employed over a long run. The Soviet Union didn't invest enough in higher productive capital, but rather capital and labor input quantities, which was a huge mistake. It attained huge growth figures at first, but stagnated in the end for this reason.

    "tried your planned economy idea already" - I don't support economic planning, or at least as it was applied in the Marxist-Leninist states.

    "North Korea, China famine, etc" - What does it have to do with anything? I said I don't support the Marxist-Leninist planning practices. I'm also a supporter of a free and democratic society, but economically democratic as well. You keep assuming that I support any of these planning practices, which is simply not true. I support real-time, dynamic and democratic economic decision making, with the resources provided by a social organization of the means of production.

    "It will result in the lack of risk-taking innovative ideas, the lack of technological progress, and a loss of individuality by forced collectivization." - What will? Marxist-Leninist central planning as well as the Marxist-Leninist political organization? Probably, but I'm not a supporter of such practices.

    "It will result in a lack of freedoms (private property, ability to take an innovative idea and start your own business), a lack of choices, and has historically resulted in disaster and atrocities. It will result in the lack of risk-taking innovative ideas, the lack of technological progress, and a loss of individuality by forced collectivization." - Never said I was against a lack of choice.


    Please provide arguments which don't address Marxist-Leninist planning (and Marxist-Leninist political organization), because I'm not its supporter. I'm not against a civil society in which all the citizens can contribute their ideas and knowledge.

  39. Post #479
    Gold Member

    February 2006
    2,990 Posts
    Forced collectivization didnt 'kill' anyone, bad weather and peasant resistance did. Soviet quotas were not 'too high' (and they were in fact lowered in famines and previously guarded grain stores were opened and distributed grain), the prices the state bought at werent profitable enough for some kulaks and there was a mass movement from the country side into the cities. The planned economy was actually pretty vital in ending russia's frequent famine cycle, this also happened in china.

    Noble, if you have a genuine interest in the 30s famine and collectivization, read Davies & wheatcroft's 'years of hunger', not robert conquest and other cold war propagandists.

  40. Post #480
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    Dennab
    July 2010
    22,111 Posts
    I find the Marxist theory of history to be especially broken for the Medieval Era.

    The Feudal system, generally seen by Marxists, is that the aristocracy exploited and repressed the peasantry. A significant number point to the Late Middle Ages until the 19th century, whereby as Feudalism declined, labour became extremely cheap and helped with the Industrial Revolution, where factories required unskilled workers to run them.

    The biggest flaw with the Marxist theory, is that the aristocracy of the High Middle Ages did not systematically exploit the peasantry. It was a arrangement that suited both parties well given the times. The term "peasant" is even a terrible term. (I am forced to use it for convenience) If you went back in time and asked somebody then if they were a peasant, they would reply "Who?"

    The people who worked were composed of many various groups of people, ranging from villiens who were tied to the land to people who were hired to run a lords estate whilst he could do important things like going on crusades. Lords had to provide things for their peasants (Free and unfree), for example, it was traditional for them to hold a feast for their peasants during harvest and christmas. It was also traditional to allow them to have their livestock graze on the common lands and allow the forest to have timber collected from it for fires. Lords were also obligated to provide military protection and some food for their peasants. Some villiens actually did better than their free cousins during various times due to the advantage of being under their lord.

    The big peasant rebellions of Europe only really began in the mid 14th century with the famines, schism of the church, and the black death. There was massive and widespread societal changes from this. The price of labour rose quite quickly, along with food prices as well as the climate worsened. The old system began to become problematic as many laws were put in place holding wages at their old levels, which were obviously ignored by both workers and employers. Labour became a much more highly valued commodity at this time (Unlike the early 14th century, when it was extremely cheap).

    The peasant rebellions began to rise due to the inflation during this time that their lords were unable to properly deal with, and were forced to raise taxes and rents. Combine this with the increasing prices of goods, growing religious tensions, the recent wars and the population decline, then you are going to get massive civil unrest.

    Those peasant rebellions were not rebellion against the systematic exploitation of the peasantry, but due to the pressures of the time that are now known as the crisis of the late middle ages. The idea that Feudalism can be simply summed up as a repressive system that kept the peasantry in their place is absurd. It even changes depending upon where you are. Feudalism does not automatically lead onto capitalism.

    Edited:

    Forced collectivization didnt 'kill' anyone, bad weather and peasant resistance did. Soviet quotas were not 'too high' (and they were in fact lowered in famines and previously guarded grain stores were opened and distributed grain), the prices the state bought at werent profitable enough for some kulaks and there was a mass movement from the country side into the cities. The planned economy was actually pretty vital in ending russia's frequent famine cycle, this also happened in china.

    Noble, if you have a genuine interest in the 30s famine and collectivization, read Davies & wheatcroft's 'years of hunger', not robert conquest and other cold war propagandists.
    No, Stalin was killing people whose lives he was "improving". There was massive quotas set for workers that were far in excess of what was humanly possible. The economic quotas set were always attempted to be actually outdid (Often they did) but at the same time there was a horrible cost of human life. Although in 1928, the industrial output was 11% of 1913s, by 1938 it was 658%. It was done in order to arm and expand the soviet military immensely.

    The collectivisation of agriculture, originally stopped in 1917, was forcibly implemented by the USSR on the farmers, in order to establish state control of agriculture as many rural people moved to the cities to work in the new industries. From 1928 to 1938, the 26 million peasant farms were joined into 250,000 collectives, along with the invention of a fictional enemy "The Kulak" to help justify this.

    The reason for peasant resistance is that they had been promised land and freedoms in the revolution. After 1928, the closing of churches and collectivisation led to massive social unrest among a people who were traditionally quite religious and held a lot of land.

    7 million people died in the Ukraine.