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really all depends. do you like your fast internet connection and the features that came with your service. enjoy the awesome graphics in video games and the kickass parts to your computer?
do you like cable tv?
are you smart enough to not get bamboozled by big smart guys?
do you like a steady job that provides benefits?
do you like low prices and progress in deals and technology in order for a corporation to win you over as a consumer?
do you like having the providers by the balls?
if yes to all of these questions, than a corporate world is for you.
You could argue, with concrete examples (Enron), that corporations have acted like evil empires. But in todays business world business ethics is not only the key driver for survival it's a form of gaining competitive advantage. The "easy", unethical, way of "taking care of things" doesn't prompt the best long term benefit. Besides the obvious penalties a corporation receives from acting unethically, a corporation's biggest incentive to be "good" is market share, or in better words keeping consumers loyal to their brand. Look at how Nike changed their ways of outsourcing let alone organizational structure after a couple articles in some big magazines exposed them taking advantage of poor working conditions in Asia. It's a liability to be bad these days. Corporations are also finding that there are real cost saving benefits associated with being environmentally friendly. Power plants that run more efficiently also require less coal or oil which are huge cost savings and in turn let off less carbon.
Nike's efforts to monitor labor are commendable, but a drop in the water compared to so many other companies doing nothing. And Nike only started to because they'd been getting bad press for it for years! It took YEARS to get any reform, and even still people are underpaid, unions are forbidden.
Corporations are earth friendly when it suits them to be, which is not all that often. Why dispose of chemical waste properly when you can just dump it and pay a fine?
I wish you were right. I wish like HELL that ethical behavior of a company led to success, and that by comparison, unethical behavior led to failure. It simply isn't true. One need look at BP as the latest in a long line of corporate f*ck-ups to see it.
How could you say that?!??!?!??!?!??!?! Corporations give us the jobs we need to make enough money for food, hosing, and clothing. Without them we would all be poor!!!!!!!!!!!!!!!!!!!
Corporations may provide jobs, but not the jobs we need. They underpay and undermine our rights, all for one purpose...the bottom-line...profit.
Then they convince us that it's all okay because in return for working shitty jobs with shitty pay and shitty benefits, and dealing with environmental damage and human rights abuses, we get the "reward" of cheap goods!
Which we wouldn't need in the first place if we worked for employers who valued us.
I'm not here to argue that EVERY corporation is bad. But the fact that corporations are treated as "persons" by the Constitution (14th amendment, believe that?) and that a corporation's sole interest is in making the most money possible by any means possible, doesn't bode for a system I would categorize as "good".
Just like people, I think corporations are by default good. It is the situation that they put themselves in or find themselves in that turns them "bad".
A corporation's niche has a lot to do with the situation that they may find themselves in. Company's like Apple, Google, Starbucks, and Ferrari have small specialized niches in the market. They can be dedicated to customer care whereas companies like Microsoft, Yahoo!, McDonalds, and GM, because of heavy competition are somewhat forced into making decision that detract from customer care.
Something else I think is very important to how a company may seem, is employee satisfaction, as it effects customer care greatly and that has a lot more to do with the customer and social expectations than the actual company itself.
Corporations big and small are fantastic. That doesn't mean corporatism is good though. Corporatism is when the state practices favouritism with certain companies in the form of subsidy, corporate welfare, and succumbing to the pressure of certain special interests by repealing laws or instituting regulations that benefit them directly. When that happens those "big corporations" have unfair advantages and begin to function as something not prone to market forces. In this sense -- the sense that they shape public policy and are immune to market pressures -- they act like a non-representative branch of the government. This is not how capitalism should function.
it really isn't capitalism. the core goals of capitalism are free market and free enterprise. if legislations are being passed that help large corporations and purposely keep small businesses from starting, that's government interference, hence, losing the free market and enterprise.
Big corporations are the best. They provide us with cheap products, and give us the jobs we need to make enough money for food and a place to stay. Without them this would be a very poor country. The only reason we are in a recession is that taxes and environmental protection Hertz business.
Big corporations are machines of economic centralization and economic stratification. They tend to suck up huge amounts of wealth and capital and deliver it to a rather small number of people.
This sort of concentration of wealth has several consequences:
1. First and foremost, large corporations have the ability to dominate local markets. Shoving out smaller businesses and keeping new ones from developing.
2. Wealth becomes stratified and concentrated in the greater population. This has ramifications for the economy as a whole; it can produce recessions due to a large number of people who have little to no real wage growth and an increasing amount of capital that cannot be spent on investments due to the fact that demand is not increasing. Economic stagnation tends to occur because of this process.
Another problem comes with innovation; big corporations are essentially economic bureaucracies. A small number of people make the decisions and approve the ideas while the vast majority of people have little to no say in how things are run and what products and services are produced (and how).
3. Money is power, the large the corporation and the more our economy is dominated by large corporations the more political power corporations have. Because of the wealth concentration effects of corporations we see a complete shift of power away from lower and middle-class people and towards the rich who own the corporations as well as the corporations themselves. (The CEO of Mcdonalds and the Mcdonalds corporation can, independently, give to a particular political party or candidate).
If you believe in democracy you should be fairly worried about this trend.
Also, the domination of a few media conglomerates; the control of all of our major sources of information and communication, is also worrisome in a democracy. It guarantees that certain viewpoints will never be expressed (or be expressed sparingly) and others will be pushed extensively.
Fox News is not the only guilty party, all of the major media outlets censor the information being given to us.
1. First and foremost, large corporations have the ability to dominate local markets. Shoving out smaller businesses and keeping new ones from developing.
Smaller businesses can continue to exist if they are savvy. They could, and have, cornered niche markets that stores like Wal-mart can't, such as. local market food, or any unique product. The only time they go out of business is when they are selling a like product and can't keep their prices low enough, thereby directing the consumer to big box stores where the same thing costs less. In that sense it is the people, not the big businesses, that drive out smaller businesses. Also, most of these stores like walmart are retailers, and their products come from a large variety of other companies, creating internal competition.
Also, I actually haven't seen this phenomenon happen on the scale normally described. In my home town we have a walmart as well as a plethora of small businesses including bookstores, restaurant, clothing stores, music and electronic stores, repair shops and variety stores. Though these places are have generally higher prices, they also have a selection that is very different from the select brands Walmart offers.
In the city (Halifax) the story is even better. There are more than 3 big box stores meaning they are in competition, and downtown where huge retailers can't fit small business is flourishing. I think the argument that they "shove out smaller businesses" comes from a type of unfounded cynicism. The people controlling the market are the consumers. Ultimately you are the ones, collectively, who put out of business the uncompetitive.
2. Wealth becomes stratified and concentrated in the greater population.
That is an awfully dubious claim. Could you cite some empirical data? In general, big corporations raise the living standards of everyone because of the low prices they are able to afford, and profit they make goes right to the stock holders who often depend on big business for their retirement etc. or back into investment. Look at Exxon Mobil. Sure they're making huge profits in terms of "that number is big." But relative to what they spend, they only get 9.8 cents for every dollar of revenue. That is low. The rest goes back into innovation, exploration, mutual funds, and other things that do precisely the opposite of concentrate wealth. Truth be told, only a handful of executives and presidents get the million dollar salaries -- still less than Judge Judy might I add. To give you a comparison, Google's profit margin is 29.89%, Walmart 3.5%, Shell Oil 7.9% (average profit margin for the last 20 years has been 8.3%). Only one solution. Tax Google's record profits! Or how bout no, because Google and everyone else benefits from putting that revenue back into the system.
Another problem comes with innovation; big corporations are essentially economic bureaucracies. A small number of people make the decisions and approve the ideas while the vast majority of people have little to no say in how things are run and what products and services are produced (and how).
I'd appreciate some examples for what your saying. Stock holders have a say. Consumers have a say. And they make their say by not buying the product. Here, if you don't like Coke and Pepsi for reason X, then buy the locally brewed soda. Propeller Soda Pop is a locally run business and, in my opinion, they taste better too. Also, it is true that the there is a lot of economic bureaucracy in big business. But what's the alternative? Oh yah, coercive bureaucracy ie. government.
3. Money is power, the large the corporation and the more our economy is dominated by large corporations the more political power corporations have.
That I can agree with. That's called corporatism. You won't find a single free market economist who is for corporate welfare. However, as we see here now, the only legitimate argument you have given is an indictment of crooked politicians who are willing to succumb to lobbyists, bribes, etc. to remove market pressures from certain corporations. There is a solution to this though. It's called smaller government!
About the news media. That I can agree with that too. However, I think we can agree that the internet is changing that.
1. First of all; while small businesses have the ability to survive outside of the market that big corporations are dominating that hardly has anything to do with my point. That's like saying that Wal-Mart doesn't harm small business because small businesses in Indonesia aren't failing because of it.
Secondly, consumer choice is highly influenced by the information we receive. Large corporations are able to dominate the commercial airwaves and get their products and services known by a larger number of people, producing familiarity and preference.
It never matters whether or not a given product or service is superior; a small business could be outdoing Wal-Mart in price (and, in my experience, Wal-Mart's prices aren't lower, at least for what I used to buy there), it doesn't matter though, as Wal-Mart is "known" for low prices, just like Uncle Bill's Snake Oil is "known" for curing baldness, scurvy, and depression.
Big businesses have other advantages that small businesses (in their industry) cannot compete with.
When certain markets or regions take an economic downturn; say the state of Missouri sees a major economic slump and consumer demand plunges. Wal-Mart and other major stores can continue to operate off of the profits from other areas of the country. Small businesses, however, don't have the luxury of a vast supply of income from a variety of regions and sources.
Also, big corporations can go into a developing area; drop their prices way below the competition (taking a loss) and use the profits from other areas of the country (or world) to wait for the other businesses to go under, close, and then put their prices back up to normal.
"The people controlling the market are the consumers. Ultimately you are the ones, collectively, who put out of business the uncompetitive."
People will buy discount poison drops if they said "quality pain killer" on it. Just because people are making bad choices doesn't mean it legitimizes the choice. That's like saying "Wal-Mart doesn't hurt anyone because everyone likes it". It's a bogus argument.
Additionally, we're invested with not only economic power (through the dollar) but political power. Just because people are willing to buy cheap goods made from children in sweatshops doesn't mean that choice is legitimate and shouldn't be taken away.
People don't have the economic right to preference slavery over freemen factory goods. Are you saying we should legalize slavery and let the market decide?
2. For one thing; you are ignoring the huge amount of government redistribution programs that have been in operation for almost a hundred years. Pretending that business alone rose the standard of living for the average person is the worst sort of tunnel vision.
First of all, before the New Deal there was an economic catastrophe or depression every five to ten years (nationally, there were far more on a local level), since the New Deal there has never been a single depression in this country, hardly a recession either. Keynesian, socialist, economics has done wonders for our economy and our standard of living.
Trickle down economics has been shown, time and again, to be a worthless sham.
The most recent example is the phenomenal increase in individual productivity in this country. A productivity increase that has not been matched by wage increases. In fact, poverty has been increasing in recent years, food stamp applications have been on the rise, and unemployment is rising as well.
How can this be? How can wages be going down by .3 per cent (that's not even factoring in our ever rising inflation) while our productivity, as individuals, has increased 8.4 per cent? Why isn't the market giving back?
The only reason we have the standard of living we enjoy today is due to government redistribution programs, market restrictions, regulation, and control over the money supply.
Of course, we wouldn't have anything to redistribute if it weren't for business, that's true. But they wouldn't have a business if it weren't for the workers and the consumers; it's also a sure thing that we can operate perfectly well without big corporations.
Here are some links backing up my claims on innovative stagnation in larger companies:
Not exactly anti-business organizations, yet they both talk about how large corporations tend to stagnate when it comes to innovation.
3. Your statements are terribly intellectually dishonest. This, again, must be a factor of your endemic tunnel-vision.
First of all, a small government would give even greater power to corporations; without a strong government most decisions would be left up, directly, to those with the most economic power; not indirectly through bribes, lobbying, and campaign funding.
Tell me, how on earth is a politician supposed to get elected without campaign contributions? How on earth are they supposed to get elected without the assistance of mass media? Without support from big business and the media another candidate would simply get in who is.
In other words, there are plenty of honest politicians or people who want to be honest politicians. The problem is that the system rewards the dishonest.
We cannot have a Democracy with a small government, we would end up in a true Plutocracy; a society government exclusively by the rich. We cannot have a functioning democracy in a system of extreme wealth stratification either. Without the backing of the economic elites no national politician stands a chance of getting elected (state and local have a slightly better chance, on down to the lowest rungs of the political ladder).
I also wonder why you only see fit to blame politicians and never corporations. Are corporations small children who are just swept up in political corruption by accident? They know exactly what they are doing, they are doing it for their bottom line, and to blame politicians only is to, again, be intellectual dishonest.
Big corporations will lie, cheat, and steal to get what they want; same as anyone else. The problem, though, is that you seem to think the best way to deal with this is to give all of the power to them and make sure there is no other entity overseeing their activities.
No matter what political system, big government, small government, monarchy, theocracy, dictatorship...the people who hold economic power hold political power. It's beguiling that you don't seem to recognize this.
People cannot make good, logical decisions when their information is controlled by either political or economic entities with a vested interest in their deception. Again, you find that it's fine for businesses to control what we know, not government. I don't see how that is better.
It never matters whether or not a given product or service is superior; a small business could be outdoing Wal-Mart in price (and, in my experience, Wal-Mart's prices aren't lower, at least for what I used to buy there), it doesn't matter though, as Wal-Mart is "known" for low prices, just like Uncle Bill's Snake Oil is "known" for curing baldness, scurvy, and depression.
Advertising is a part of any successful enterprise, and I do not believe that if company X sells product A for a cheaper price than company Y, that company X will not have enough money from people flocking to that place for the lower prices to advertise on a larger scale! That's how all companies start out, and that's ultimately how retailers become successful. Minimal advertising attracts a basis for future advertisement. In fact, the only benefit Wal-mart has in advertisement is that it's on a national scale. That kind of advertisement would be useless to a local business that only really requires fliers and a newspaper spot.
Big businesses have other advantages that small businesses (in their industry) cannot compete with.
The only tangible advantage big business has is the sense that they're successful and have a reason that success. That's like saying "successful businesses have an advantage over unsuccessful businesses, insofar as they're more successful." That suffers from conspicuously poor logic. As I said, ultimately the consumer decides, and they in the mass, always decide toward the company that gives the best quality and quantity for the least cost (which is usually the larger businesses). This is the nature of competition, and very basic economic theory.
When certain markets or regions take an economic downturn; say the state of Missouri sees a major economic slump and consumer demand plunges. Wal-Mart and other major stores can continue to operate off of the profits from other areas of the country. Small businesses, however, don't have the luxury of a vast supply of income from a variety of regions and sources.
How is that a bad thing? Companies like Sears and Wal-mart etc. have been the last hope for many regions hit with disaster. They're more resilient, and that is a very good thing for people who need food, clothing, and shelter immediately after a natural disaster or economic downturn. Once people are back on their feet they can, with the same ease, reopen their enterprise without any resistance.
Also, big corporations can go into a developing area; drop their prices way below the competition (taking a loss) and use the profits from other areas of the country (or world) to wait for the other businesses to go under, close, and then put their prices back up to normal.
It would have to be a very developing area, because the places with the most people unusually have many big retailers like Chapters, Futureshop, Target, Macy's, Barnes & Noble, Old Navy, Winners, and down the list that are all in a sort of competition for the best retailer. In smaller developing areas, where there are admittedly less people effected, what you describe is possible. Again, though, as in my hometown where we basically only have a Wal-mart when it comes to big name suppliers, businesses can always (and always do) reopen once the prices are low. This is a necessary fact for the simple reason that towns need employment -- more than Wal-mart can satisfy. Nevertheless, the stores that Wal-mart ends up shutting down are stores that sell like-goods for higher costs. Niche markets remain open unabated. Again, however unfortunate you wish make this out to be, it was completely determined by consumers democratically moving their business to Wal-mart.
People will buy discount poison drops if they said "quality pain killer" on it.
Hopefully not without suing the making for fraud.
Just because people are making bad choices doesn't mean it legitimizes the choice.
Why are they bad choices? Over all, the existence of a Wal-mart or like business in small communities is indicative of local wealth. In other words, it's a sign of economic health. Just because a few business owners get hurt along the way doesn't make it a bad choice, nor does it negate the fact that it is completely determined my the consumer. All you are doing is describing facts of competition -- a positive trait of capitalism.
Just because people are willing to buy cheap goods made from children in sweatshops doesn't mean that choice is legitimate and shouldn't be taken away.
Why not? Because of capital flow and economic globalization have caused poverty rates to drop dramatically in places like China, compared to areas less affected by globalization, such as Sub-Saharan Africa, where poverty rates have remained stagnant. I understand the desire for good working conditions in these developing countries, but the simple fact is that if it weren't for the "sweat shops" they would be completely jobless. Capitalism with reduced trade barriers stands alone in it's ability to raise people out of poverty, sweat shops being a starting point (in the last 20 years the number of people in developing countries living under $1 a day has dropped from 40% to 20%).
"The percentage of people living on less than $2 a day has decreased greatly in areas effected by globalization, whereas poverty rates in other areas have remained largely stagnant. In East-Asia, including China, the percentage has decreased by 50.1% compared to a 2.2% increase in Sub-Saharan Africa." So you see what you are characterizing as the problem is in actuality the beginnings of the solution.
People don't have the economic right to preference slavery over freemen factory goods. Are you saying we should legalize slavery and let the market decide?
What a horrible misunderstanding you have of libertarian philosophy. Libertarianism is the anti-thesis of slavery and states that you should be able to express your freedom to the utmost, only so long as your freedoms don't infringe on the freedoms of others. Libertarianism is not a state of anomie. It is not lawless. That state and local governments still define laws within the context of human relation with individual rights being cardinal. The starting rights are your right to life, followed by liberty and the pursuit of happiness, each depending on the preceding right to exist. I have no right, however, to infringe other peoples rights, and that includes through coercion, forced labour, or slavery. Exceptions are abound, but this is the foundation of any free society.
Keynesian, socialist, economics has done wonders for our economy and our standard of living.
HA. The only thing Keyne did was misunderstand what caused the great depression! The great depression was caused by there being a run on the bank and the Federal Reserve's inaction. The Fed had the responsibility of printing more money to avoid a depression and it failed to do so, mostly because of new leadership.
Since that time government has only grown bigger and bigger, with devastating effects.
How can this be? How can wages be going down by .3 per cent (that's not even factoring in our ever rising inflation) while our productivity, as individuals, has increased 8.4 per cent? Why isn't the market giving back?
I don't quite understand what you're asking, nor does that link you gave me give nearly enough details. However, here are some (i think) relevant things to bare in mind. 'These statistics do not tell the whole story. Taken alone, they portray workers’ living standards in the most negative light possible by ignoring almost a third of what workers earn. Benefits are an increasingly large component of worker compensation and now account for 30 percent of workers’ pay—and this proportion has risen sharply in recent years. Ignoring benefits misses much of what workers actually earn, but that is what the economic pessimists do.'
'Another of the pessimists’ claims is that workers are being shortchanged because wages have not kept pace with productivity growth.[21] Since 1995, worker productivity has increased rapidly. Employees now produce far more per hour than at any time in the past. According to economic theory, competition should force companies to pass on productivity gains to their workers as higher wages and compensation.'
'However, the current lag in wage growth is not unprecedented; in fact, it is familiar. Wages and productivity often diverge during the course of the business cycle. For example, productivity grew faster than compensation for several years after the recovery from the 1991 recession. The last recession ended in November 2001, five years ago. At this same point following the end of the 1991 recession, productivity had risen 8.4 percent, while compensation had risen only 5.2 percent.'
'Earnings growth did not match productivity growth in the 1990s until 1997, when the unemployment rate fell and companies faced competition to hire increasingly productive workers. As a result, incomes shot up. By 1999, employee compensation had fully caught up to the productivity gains of the early 1990s. In the end, income and productivity did move together, but that result took several years to reach.'
I read the beginning of that Forbes article and question whether you actually read it all. The article prefaces the theory that bureaucracy stifles innovation, and then the author of the article goes on to show categorically why this is false. It's almost like what creationists do when they quote Darwin talking about the improbability of the eye evolving... right before he goes on to explain how the eye evolved. Talk about tunnel-vision! In fact, the header on the second page of the article reads "HOW BUREAUCRACY AIDS INNOVATION".
Not exactly anti-business organizations, yet they both talk about how large corporations tend to stagnate when it comes to innovation.
Do you have any credibility left? You should that you have no desire to read past the first paragraph, when the last paragraph in the preamble states: "In the following passages, I will take you through several examples of how bureaucracy and tight controls are facilitating, contributing to, and supporting the innovation efforts in some large, diversified, and well-known corporations."
Innovation may very well work with bureaucracy, but incentives to innovate are a market force. That's why America has the best health care technology in the world, and why countries with socialized medicine ride on America's back for new advances.
Your other link from portfolio doesn't seem to contradict this either. The author is in fact praising companies like Apple and Wal-Mart. He goes on to explain how companies take over a market they plateau. They have no real reason to innovate, just like a species adapted to its environment has no need to evolve. "The reward is that they get big. The punishment is that when they get big, it gets harder and harder for them to grow," says Grove, which is in essence exactly what I said earlier. It is undesirable for a company to have an absolute monopoly.
The main purpose of that article is to discuss the theory of "cross boundary disruption," where a corporation diverges from it's normal industry "with an innovative product or service [to] shake up the status quo and reap big profits." He cites many examples of this. This is a positive aspect of capitalism and is the opposite of "yet they both talk about how large corporations tend to stagnate when it comes to innovation."
Commentarymagazine reports, "The amount Grove is spending is a fraction of what the Gates Foundation has, but you do get the sense that his “creative capitalism” is far more rigorous than what Gates has in mind. For Grove, the problem isn’t the nature of capitalism, it is the lack of contrarian second-guessing within business and governments that is the real enemy of innovation."
I'm happy to see the things you are citing against capitalism are in fact for capitalism.
First of all, a small government would give even greater power to corporations; without a strong government most decisions would be left up, directly, to those with the most economic power; not indirectly through bribes, lobbying, and campaign funding.
I think I already covered, and indeed economic theorist settled this decades ago, that a companies interest is the consumers interest so long as market forces exist. Big government takes away these market forces, making a company immune, and thus removing the incentive to lower prices and increase quality for market share.
Tell me, how on earth is a politician supposed to get elected without campaign contributions? How on earth are they supposed to get elected without the assistance of mass media? Without support from big business and the media another candidate would simply get in who is.
I agree. The political system is very corruptible in terms of the shady exchange between special interests and politicians. That wouldn't be an issue though, if politicians didn't have such power. It's only under a Keynesian frame of mind that government has exploded in size, especially so under the Bush administration. A limited government would have, of course, limited powers. In my dream world no one person in America would have the power to bomb Iran, or invade a country, or to wire tap, or execute, and so on, thus making it nearly impossible for a single corrupt soul from ruining the country. Of course it is still possible, but much more difficult.
In other words, there are plenty of honest politicians or people who want to be honest politicians. The problem is that the system rewards the dishonest.
Completely agree. Ironically, this is an argument against decreasing government size and powers, and increasing government transparency.
We cannot have a Democracy with a small government, we would end up in a true Plutocracy; a society government exclusively by the rich.
You mean like Russia, or China, or North Korea, or Cuba, or Venezuela, or Briton, or Norway, or, pardon me, the United States of America? Do you honestly think the Obamas, Kennedys, Bushes, Clintons etc. are poor?
No, in a limited government the ruling class is the average citizen. I also, like most libertarians, advocate power being allocated to the 50 states and the states being sovereign. They should be able to create their regulations and bylaws without overruling by federal law (except the constitution) or supreme court ruling, and the "executive branch" should probably be removed all together.
This would open up a multiparty system because ideologies are typically geographical (bible belt, North East liberals, etc.). The only reason we have a 2 party system in America now is because the Democratic platform and the Republican platform are vague enough to make all other potential parties (communist, green, libertarian, marijuana) conform. This would make the representative government truly representative. Of course, this is going off topic from capitalism, and I do not speak for all capitalists.
I also wonder why you only see fit to blame politicians and never corporations. Are corporations small children who are just swept up in political corruption by accident? They know exactly what they are doing, they are doing it for their bottom line, and to blame politicians only is to, again, be intellectual dishonest.
I beg to differ. Corporations always want to appeal to three things. The stock holders, their employees, and their customers. This is the break down of the profit motive. So they pursue not technically "their self interest". The corporation isn't a person. It is made up of those three parts. So who is to blame? The corporation for pursuing the bottom line for it's components (which runs the economy), or crooked politicians for enabling them to now follow the rules. When discussing cause and effect, it is the new condition that is usually attributed to the cause, be it the finger that pulls the trigger, or the congressmen that opens the door for the special interest?
No matter what political system, big government, small government, monarchy, theocracy, dictatorship...the people who hold economic power hold political power. It's beguiling that you don't seem to recognize this.
What political power, under the system I have described, does the "big corporation" have? They don't hold power. They do under the current system. In my system it is the individual who has the power. The citizen.
People cannot make good, logical decisions when their information is controlled by either political or economic entities with a vested interest in their deception.
Deception is fraud, and there is room under my system for class action law suits. Simply saying "they will lie for profit" is not enough. You have to prove that it is feasible that they will lie when the law prohibits it.
1. You have rather strange ideas about advertising, ideas which aren't even held by those practicing your Capitalistic ideals. Wal-Mart and other national and international chains would probably disagree with you when you state the following:
"In fact, the only benefit Wal-mart has in advertisement is that it's on a national scale. That kind of advertisement would be useless to a local business that only really requires fliers and a newspaper spot."
This is curious; seeing as you seem to miss the fundamentals behind the business. You see, national advertising doesn't matter to local businesses when the advertiser is, say, a national mail-order catalog or internet business.
However, because Wal-Marts sell locally they are advertising locally, nationally. In other words; they are advertising to thousands of local communities at the same time, on a national scale. They are also using advertising mechanisms which are far more powerful than anything a small business can compete with.
Wal-Mart also has the advantage of the rather mobile population it serves. If you live near or in any major or moderate (even many small) population centers you are near a Wal-Mart, it is familiar to you. All of the small, local businesses in the area are unknown. Most people, of course, go to familiar places. The effect is rather obvious; people are habituated into going to Wal-Mart because of familiarity, branding, and the tendency of these and other machinations to push small businesses out of the market.
Small businesses are left with newspapers, fliers, small signs, canvassing, and (sometimes) small television spots. In the market, though, these are like taking B.B. guns to a nuclear war. The sophistication and reach of the national brands is spectacular and compounding; I can't believe this concept is lost on you.
2. There are large, gaping, fundamental holes in your consumerist logic. The following statement is rather telling in both what it implies and what it leaves out:
"As I said, ultimately the consumer decides, and they in the mass, always decide toward the company that gives the best quality and quantity for the least cost (which is usually the larger businesses). This is the nature of competition, and very basic economic theory."
Not only is it well established that logic and reason have little to do with the bulk of purchases (if it did we'd see the entire advertising industry bankrupted); you are leaving out values beyond simple price vis a vis quantity. Things cost more than their price and most people don't factor in the social, environmental, and "economic" cost of purchasing a particular good or service.
Lemme' give you some info you knock out your logical consumer theory:
It's always funny to me that you have to use biased sources from your side to back up your arguments while I can find sources from your own side to back me up.
People are not going for the best quality versus cost, some might, but quality is extremely subjective anyways. People regularly buy cigarettes, drugs, alcohol, fattening food, as I said before they'd buy poison if the price was right. (and they used to, before the FDA was a working organization..well...I mean...we still do.). We buy harmful materials, consume them, and allow them to kill us for seconds of pleasure; not entirely logical, is it?
People will buy houses without any money; they'll choose gambling over the electricity bill, they'll choose meth over food. Where is your logical consumer? I am still trying to find this most mythical of beasts.
3. What Wal-Mart did was a good thing, though they supported and continue to support the political administration that caused such a tremendous screw-up.
The government is perfectly capable of doing what Wal-Mart did, for free (it made a profit from its activities, after all). What Wal-Mart did was not a result of market forces, though, according to this study:
It was local and it had the resources to act; we could just as easily have a government entity run on a decentralized plan (such as the successful coast guard depicted in the story) than a for-profit company that still does more harm than good (they, again, helped put us in that position in the first place).
To sum up, small businesses may not be able to handle regional disasters (though they could if they coordinated under a larger entity); we have a Federal Government which is supposed to do that. Unfortunately, because of the influence of businesses like Wal-Mart we have conservative, anti-government politicians who utterly ruin our government's ability to function.
By the way, I live in the State of Missouri, a state (along with Iowa, Illinois, and others) being hit by the recent flooding of the Mississippi. The government has performed well; we havn't seen half the damage since the government-built levees were constructed after the great flood of 93'. It's a wonderful counter-example of how government (a cooperation of State, local, and Federal) can fix problems and saves lives/property.
4. "Hopefully not without suing the making for fraud."
It's hard to sue after you're dead. It's also hard to sue with a weak government and a low-paid lawyer backing you up against a billion-dollar company and its cadre of high-priced lawyers.
5. I've already established that when large-scale businesses take over a given market ingenuity slows. Ideas that small businesses had that could improve our lives would be lost when they go under.
You also can't actually believe that people are making the best possible decisions when it comes to purchasing. Only if people knew every single one of the choices available to them, were able to carefully weigh each one, and then make a decision could you even plausibly say that. We all know that that is completely impossible.
What's strange to me is that you aren't worried about the problem of corporate domination from a Libertarian perspective. Did you not notice that the result of big corporations knocking down small businesses you'll see an ever-decreasing number of entrepreneurs, small property and capital owners? Essentially, you are supporting the elimination of individual private property for corporate private property; where most land and business is owned by a few large corporations.
Besides that effect, we also have the internally destructive effect of non-productive culture. Because Wal-Mart and the like sell mostly foreign made, cheap goods they not only destroy small businesses locally but destroy domestic manufacturing nationally.
Our goods cannot compete, price-wise, with goods from slave, sweatshop, and child-labor from overseas. As a result, we see more and more factories close down, more and more people needing cheaper goods, which means more shopping at Wal-Mart, which means even less demand for domestic goods and so on and so forth.
All the while the money is being taken out of our local communities and sent to the HQs of the corporate behemoths and the piggy-banks of their CEOs.
That billion-dollar account a Wal-Mart exec has could be a few thousand dollars in thousands to millions of people's accounts spread out across the country. (again, with all of this money moving out of the community there is even less to spend on small businesses nearby).
But oh, they are ruining our economy, sending millions of people into poverty, supporting and expanding child-labor, and putting into power corrupt and inept politicians with their campaign contributions but at least they helped some people (for a profit) during hurricane Katrina.
6. Well I am glad you admit the market shouldn't decide everything.
7. "Since that time government has only grown bigger and bigger, with devastating effects."
It seems that the larger the government grows the larger our economy. At the very least the massive growth in our government's size since WWII hasn't stopped phenomenal economic development in the United States and Western Europe. But let's not get muddied with facts.
First off; your explanation for the great Depression is nauseatingly simplistic and baffling inept. "There was a run on the bank and the Fed didn't print money to save the economy...somehow".
Really, that simple? There was a massive, random run on the bank due to what? Just A BANK? Have you been paying attention in your history classes sweetheart?
For one thing; the people that told the Fed to act so ridiculously were the people in charge of the economy, the capitalists. They didn't want government intervention in their affairs; they are the ones that told the Fed not to act. (but, again, it's 100% the government's fault..and not just the administration, the entire concept of government caused the Great Depression).
Secondly, the run on the banks came from the panic, which followed on the heels of the Stock Market crash.
Here's the thing, I've been reading up on where you got the monetarist explanation for the Great Depression. In fact; I am going to start a Great Depression thread on its own because this is a rather fascinating topic of discussion.
I suppose we'll have to duke it out over here (once I've had the bloody time to research other parts of this debate):
8. For one, the fact remains that there is a creative stifling effect in large companies; I didn't say that it was impossible to overcome; but it is a major problem. That was my whole bloody point. I also didn't say large companies don't innovate, they just innovate at a much slower rate than smaller companies...but no matter to you. You can just make up my arguments as you go along.
The article, in its first three paragraphs, states exactly this. It indicates that such stifling tendencies are possible to overcome, but it recognizes the problem I identified (while you pretend it doesn't exist.)
The rest of this is going to have to be completed later or in other debates. I don't have the time to finish at this point. It's midnight already and I need to work in the morning. Didn't want to leave you hanging though; it'd be cruel to withhold fresh meat from a starving dog.
However, because Wal-Marts sell locally they are advertising locally, nationally. In other words; they are advertising to thousands of local communities at the same time, on a national scale. They are also using advertising mechanisms which are far more powerful than anything a small business can compete with.
The point I was making, and think I made, was that their advertisement advantage is not that much greater because though their message reaches a greater audience, it reaches in practical terms, the same audience locally as a local business can. You also give me the impression t hat you believe humans are very naive. Wal-mart has a higher budget, for sure, but fundamentally people respond to substance and not flashy lights. You haven't been tricked by the green screens and CGI, and using you as a high bar for nativity, I believe the average Joe sees through it too.
Either way, your point on advertisement doesn't have any merit, for it doesn't drain business in a way that is measurable -- at least in theory: Wal-mart has a larger supply then a local business, thus their ad budget is proportionate. In my town there are numerous stores that have no TV advertisement whatsoever, and they operate at full production. This is all kind of a silly thing to argue over, because ultimately Wal-mart has the right to obligation to advertise at full strength, and if a store or two goes-under because of it then they should take responsibility for not getting the word out that their prices are lower etc. This seems terribly unlikely though.
All of the small, local businesses in the area are unknown.
Evidently the word "local" escapes you. To help you understand, foreign is it's antonym. You're really stretching to make your argument. Towns and cities depend on local business, and it therefore perplexes me that this whole time they haven't been able to find them.
The sophistication and reach of the national brands is spectacular and compounding; I can't believe this concept is lost on you.
Even if this were super relevant on a micro scale, many of the local businesses in my area are franchises. They might sell cars or food, but they get the luxury of selling recognized brands. Come to think of it, the tiny general store I bike to sells recognized brands too.
Not only is it well established that logic and reason have little to do with the bulk of purchases (if it did we'd see the entire advertising industry bankrupted); you are leaving out values beyond simple price vis a vis quantity. Things cost more than their price and most people don't factor in the social, environmental, and "economic" cost of purchasing a particular good or service.
Sure, people impulse buy. They also don't always acts rationally like the game theorists would like. However, I don't consider them imbeciles. I think the consumer will make their own decision and that the emergent effect will be rational, i.e. with what the market predicts. At least that's what history has shown.
Those two links you give me are rather laughable. The first illustrates the well known phenomenon of impulse buying, which the evolutionary psychologists predicted long before that particular study was released. However, chocolates is a rather dubious thing to use. I suspect the the same facts aren't as true for buying a new car, house, computer, furnace, or anything else of considerable cost.
These are the heaviest attacks against capitalism you can make? It seems like nit picking when compared to the big picture. That big picture being the huge successes of capitalism and privatization to raise people out of poverty and let them lead a better life. The welfare state of the socialists is infeasible on a micro psychological scale, as well as on the macro economic scale. And without offering an alternative?
It's always funny to me that you have to use biased sources from your side to back up your arguments while I can find sources from your own side to back me up.
I'll ignore the paradox in that. The red herring should not be ignored. In fact, it should be underlined. My sources are scholarly and empirical. The ideology associated with them is by in large irrelevant to the facts they lay out. Instead of attacking the man, attack the facts, so long as you want to remain logically cohesive.
People regularly buy cigarettes, drugs, alcohol, fattening food, as I said before they'd buy poison if the price was right. (and they used to, before the FDA was a working organization..well...I mean...we still do.). We buy harmful materials, consume them, and allow them to kill us for seconds of pleasure; not entirely logical, is it?
No it isn't. That why I don't do any drugs myself, and take medication only as a last resort. However, I would never advocate telling a person what he or she should do with their body. People have a personal responsibility and that is their main prerogative. I actually do not support the war on drugs at all, and favour complete legalization. Same with foods. So long as it is advertised that food X contains unhealthy fats, then it is up to the individual to decide whether she wants X or Y. It's called freedom.
People will buy houses without any money; they'll choose gambling over the electricity bill, they'll choose meth over food. Where is your logical consumer?
The meth addicts and the people directly effected by the housing crisis are a minority. Even so, capitalism is a system that gives a person the capacity for success. Likewise, it will give them a capacity for failure. I think that it is elementary of a free society that a person should fail if they do things that are risky or stupid. Luckily for them, in a capitalist society the wealth of all classes, poor included, increases incrementally.
It was local and it had the resources to act; we could just as easily have a government entity run on a decentralized plan (such as the successful coast guard depicted in the story) than a for-profit company that still does more harm than good (they, again, helped put us in that position in the first place).
Um... again the links you cite in support of your argument come to the opposite conclusion. :P
From the article: "It's not the Federal Emergency Management Agency. A new study suggests Wal-Mart, Home Depot and Lowe's would be a lot more helpful.
Examining federal and private responses to Hurricane Katrina, the study says why FEMA was destined to fail and why for-profit companies succeeded at disaster recovery."
Also notice that when it mentions the Coast Guard (which is like a police or military service and therefore, in my opinion, should be governmental) it says "It also looks at the Coast Guard -- the only federal agency lauded for its Katrina performance..."
"Profit-seeking firms beat most of the government to the scene and provided more effectively the supplies needed for the immediate survival of a population cut off from life's most basic necessities," Horwitz wrote in the study.
I don't doubt that the state can help, like it did in Missouri. I am not an anarchist. I'm just a capitalist. Nevertheless, I find it ironic that you use levees as a pro after mentioning Hurricane Katrina. I think in many cases, private industry can do a better job than government bureaus. I don't think the government is completely inept. Levees in your area apparently did their job. I simply will say that private industry does a much better job. Like Horowitz says in the link you gave: ""Disaster response happens at the local level," Horwitz said. "FEMA is not local to anyone except people who live in Washington, D.C." And like Friedman explains, when talking about how private enterprise can fix Central Park: 2:05
It's hard to sue after you're dead. It's also hard to sue with a weak government and a low-paid lawyer backing you up against a billion-dollar company and its cadre of high-priced lawyers.
It's called tort law.
I've already established that when large-scale businesses take over a given market ingenuity slows.
When? The link you gave be earlier showed not that it slowed by that A) corporate bureaucracy helps innovation and B) innovation is best when it is innovative, like when Apple crossed into the digital music industry.
Essentially, you are supporting the elimination of individual private property for corporate private property; where most land and business is owned by a few large corporations.
You mean like the federal government? They own around 25% of the land in America. They should only own, in my opinion, the land that their government buildings are on. And corporate private property? In the first place, corporations, again, don't own anything. Stock holders, employees, customers, and a few executives own corporate land collectively. In the second place, the system that would allow your unfounded anxiety of corporately owned property is the system we are currently under. You are making a prediction of the effects of what I am advocating when what I am advocating is by in large currently in place. Your predictions still miss the mark! This proves once and for all that anti-capitalists can't see whats right in front of their eyes. The only changes in this regard that I favour is removing government from business. That in no way makes it easier for corporations or governments to control us as individuals. It makes it considerably harder, and considerably less profitable. Moreover, corporate welfare is not something any libertarian advocates. Libertarian free-market institutes like Cato, for example, are vehemently against corporate welfare.
All the while the money is being taken out of our local communities and sent to the HQs of the corporate behemoths and the piggy-banks of their CEOs.
Such convoluted cynicism. "The piggy-banks of their CEOs." Give me a break. Most profit goes to the share holders, mutual funds and reinvestment. I challenge you to find me a single successful company that doesn't reinvest more than 80% of their profits.
It seems that the larger the government grows the larger our economy. At the very least the massive growth in our government's size since WWII hasn't stopped phenomenal economic development in the United States and Western Europe.
And it hasn't aided it either.
Really, that simple? There was a massive, random run on the bank due to what? Just A BANK? Have you been paying attention in your history classes sweetheart?
For one thing; the people that told the Fed to act so ridiculously were the people in charge of the economy, the capitalists. They didn't want government intervention in their affairs; they are the ones that told the Fed not to act.
You are clearly wrong on your history here. Friedman, before his death, was one of the greatest speakers on the Great Depression, and though I simplified it for you, in goes into great depth in his lecture series. Full Explanation of the Great Depression
If you want, we can take this to the other debate. This is too broad a topic for one discussion. I too am getting lazy in my responses simply because I'm starting not to care about your rhetoric, false assumptions, and general ignorance (not to mention this thing is become a novel).
I recommend you go back and read over our discussion thus far, because a lot of what your saying I have already addressed. I don't feel like talking in circles with you.
Supporting Evidence:
A great video
(video.google.ca)
Well, I certainly wish I could copy-paste excerpts from two websites (and post youtube videos), be absolutely dismissive, ignore argument, and then declare victory. Must be an easy life being so comfortable in your superiority.
You might want to pay attention to the following, though, unless you're too tired or bored:
1. Here are a number of abstracts from the journal of consumer research which help to counter your belief in a consumer's rational choice:
"This article illustrates how the compromise effect alters consumers' selection of soft drinks. Using three within-subject studies, we show that extremeness aversion and price insensitivity cause consumers to increase their consumption when the smallest drink size is dropped or when a larger drink size is added to a set."
Here are some interesting quotes:
"We demonstrate that consumers who have been recently reminded of their own impending mortality wish to purchase higher quantities of food products (and actually eat higher quantities) than do their control counterparts. This effect occurs primarily among low-self-esteem consumers."
"A combination of field and laboratory experiments reveals that the mere presence of categories, irrespective of their content, positively influences the satisfaction of choosers who are unfamiliar with the choice domain."
"We suggest that consumers assess the taste of a food or beverage by comparing the human values symbolized by the product to their human value priorities. When there is value-symbol congruency, they experience a better taste and aroma and develop a more favorable attitude and behavior intention; incongruence has the opposite effect."
"Additionally, we show that subliminally evoked retail brand names can serve as the cues that activate purchasing goals."
"Three experiments examine how power affects consumers' spending propensities. By integrating literatures suggesting that (a) powerlessness is aversive, (b) status is one basis of power, and (c) products can signal status, the authors argue that low power fosters a desire to acquire products associated with status to compensate for lacking power. Supporting this compensatory hypothesis, results show that low power increased consumers' willingness to pay for auction items and consumers' reservation prices in negotiations but only when products were status related."
So far no psychological studies showing that people are basically rational when choosing particular products or services, quite the opposite in fact. Then again, this is all just rhetoric, right?
As for myself, I regularly make decisions which harm my health, my social standing, my career, and my education; even though I know perfectly well that they are doing so. In purchasing things I will go into a store not wanting to buy anything fattening (I'm gettin' abit pudgy) but even I; someone who is completely aware of these tricks, and an avid hater of corporations, will buy something deliciously fattening from a large corporation. That's right, I even make decisions that go against my very principles.
When I go to the grocery store I am overwhelmed with desire, with hunger; and study after study confirms the same thing about most people. I dare you to go to a large supermarket with a bunch of money in hand and not spend a single dime. You'll be tempted; and you'll probably succumb (especially the longer you stay there).
"The influence of the adopters' group size on a consumer's decision to adopt a new product varied among individuals with different levels of needs for distinctiveness and assimilation: when need for distinctiveness was low, the higher was the need for assimilation and the larger was the perceived group size, the higher was the probability of adopting the product."
"We propose that consumers buying from low- (vs. high-) reputation sellers pay greater attention to surcharges. Thus, reputation moderates the effect of surcharges on purchase. Data from eBay show that consumers adjust bids to account for surcharges when buying from low-reputation sellers but not when buying from high-reputation sellers (study 1)."
"Prior research has shown that individuals are often susceptible to a false consensus effect, whereby they overestimate the extent to which others share their opinions."
Just because I didn't have the time or energy before to research my points properly shouldn't have given you the comfort of declaring victory. I wouldn't be so haughty next time, love.
Do you have any, any data backing up your rational consumer theory from a psychological association, a scientific body of any kind? Do you have any researchers in the field of social psychology, sociology, psychology, psychiatry, biology, neurology, anything?
"The authors state in the study that "by displacing the local class of entrepreneurs, the Wal-Mart chain also destroys local leadership capacity."
I know, I know, I don't have a youtube video from 1973 by a dated and fallable economic philosopher to back me up. I guess I'll just have to rely on scientific studies by independent researchers instead.
It never matters whether or not a given product or service is superior; a small business could be outdoing Wal-Mart in price (and, in my experience, Wal-Mart's prices aren't lower, at least for what I used to buy there), it doesn't matter though, as Wal-Mart is "known" for low prices, just like Uncle Bill's Snake Oil is "known" for curing baldness, scurvy, and depression.
Advertising is a part of any successful enterprise, and I do not believe that if company X sells product A for a cheaper price than company Y, that company X will not have enough money from people flocking to that place for the lower prices to advertise on a larger scale!
What you seem to underestimate in your argument is the power of a brand. Branding has been at work on such a large scale, that nearly all choices are affected by it. As a child, McDonald's makes you a lifelong customer through advertisements and Happy Meals (associating a clown and toys with their food).
If you want proof that superior products do not win out over branding, just look at beer. 1,500 breweries operate in the US, but yet in 2003, the top 3 brands (Anheuser-Busch, Miller, and Coors) accounted for 82% of the market (http://en.wikipedia.org/wiki/Beer_in_the_United_States#Beer_and_society). Not only are these brands crap (the light versions, that is, which are so heavily and successfully marketed), they are identical crap. On Penn and Teller's BullSh!t, those who claimed one of the 3 (Bud Lt, Miller Lt, and Coors Lt.) as their "favorite beer" could not identify it in a blind taste test.
The only tangible advantage big business has is the sense that they're successful and have a reason that success. That's like saying "successful businesses have an advantage over unsuccessful businesses, insofar as they're more successful."
No, the tangible advantage is that from their success they have ridiculous power, both in terms of financial stability and brand management.
Corporations always want to appeal to three things. The stock holders, their employees, and their customers. This is the break down of the profit motive.
As such, they are willing to break the law so long as there is more financial incentive to break the law and pay a penalty for bad behavior than to not do so and lose out on potential profit. They care not for their effects on consumers, society, or the environment. They will try to make as much money as we possibly will let them.
IMO we've let them go way too far. Oil companies, pharmaceuticals, and all the rest are taking advantage of the consumer and of America. It's tragic that we've gotten to this point, but I don't believe you're right that legislation will stop them. They ignore current legislation because they make more money by ignoring it than by following the law. Until they're held accountable for their effects on the population, they will continue to reap power from the people.
Really? A small grocer can afford to up and move a building far enough away from a Walmart to not feel it's presence.
Walmart was not 3.5, it was 18% margins
People have a say? BS!!!! Not unless you are a majority shareholder. Most of these companies don't need a shareholder vote to make decisions.
Big corporations raise living standards? Are you f-ing kidding me?!!! When Walmart puts out and Albertson's and 60-150 people who have the opportunity to make 14-16 per hour and replace it with 9 dollar per hour jobs that is raising a living standard? Buddy I've lived on both sides (being at the bottom of the food chain and the top) of this and you have got this all wrong.
I'm only going to respond to your first point, because quite frankly it's all I have the patience for at this time.
Reasons big box stores are successful:
1-They are 2-3 times bigger than any previous small business model of that type could hope to be.
2-They buy so much stuff to pack their thousands of shelves that retailers are compelled to give them a hefty discount on their purchases.
3-They cut their prices so low that no small-town business could hope to compete
Basically, they're bullies of the market world. They come in with so much buying power that competitors are basically knocked out without so much as a fair fight.
Oh, and they spend billions of dollars in advertising each year!
What's the alternative? People aren't the same, they're smarter or dumber. Capitalism models people fairly well. We're greedy and selfish and we want the water hole. There's a natural pecking order and corporations have flourishing in the waters of separation. It certainly looks like the direction is towards a single pan-global corporation running everything including a 'world government'. Is this necessarily a bad thing for the human race? Does it really have to turn out to be 1984 or a Brave New World dystopian nightmare?
An alternative to Capitalism is already being practiced by every single developed, western nation. We no longer live in a Capitalist society; perhaps moreso than Canada, Europe, and Japan, but our economy is thoroughly socialistic these days. We do not live in a free market, we havn't since the New Deal, and it has done us mostly good.
Our standard of living has risen dramatically since the introduction of welfare, stock market controls, regulation, pollution controls, social security..etc..etc..
Capitalism does not model people well at all; it models some people well, but the vast majority of people can be both greedy and generous; good and evil, selfish and selfless.
Do you really think the men and women in our armed forces are in that job for the pay? Do you really think teachers chose that career path for the riches? What of the numerous polls and surveys that indicate people would take a pay cut in order to spend more time with friends and family.
Capitalism appeals to a very small aspect of our humanity, we care about a number of other things above and over money and wealth.
I believe an alternative can be found that both allows for a market-driven economy which rewards productive and innovative behavior while also protecting individuals and keeping wealth concentration from getting out of hand.
A truly worker-run economy, an economy of small businesses, family businesses and farms, non-profits, and cooperatives can completely replace our current system (and probably improve it). With wealth spread out and economy power in the hands of many instead of few we'd probably see a higher degree of innovation and a much better government.
If you hadn't noticed, innovation in most industries and services tends to occur at its highest rate in the developing stages, when there are a large number of competing entities. Because of the pressure to survive and the larger number of people who have a direct say in how things are run we see a plurality of ways and ideas to tackle various problems.
Stagnation tends to occur when a handful of enterprises manage to eat up the market.
actually, we ended the free market shortly after the industrial revolution. the New Deal was just further wealth redistribution.
basically, shortly after the industrial revolution is when we started becoming socialist. although, it wasn't nearly as marxist as the events in the 60s.
but you're right, we're not a capitalist country. there is no capitalism anymore.
Well, I use a scale from true Capitalist to True Socialist; and up until the New Deal I supposed that we were more Capitalist than Socialist (though we had already developed plenty of restrictions and distribution methods by then), the New Deal, I believe, pushed us over into the "more Socialist than Capitalist" side of the scale.
I've never read a more misinformed post on Createdebate. It is absolutely true that the standard of living has increased at all levels in the past 70 years, but we have to understand why.
Our standard of living has risen dramatically since the introduction of welfare
Has it? Welfare has the intention of benefiting low income families, but in ever study done on the subject we have found it has the opposite effect -- like so many well meaning reforms. Innumerable studies, which I will link below, have found that welfare has a deleterious effect on children impeding their ability to enter mainstream society. Empirical dates says that the longer a child remains on AFDC in childhood the lower will be his earnings as an adult. Being raised on welfare also increases the probability that a child will drop out of school and will be on welfare as an adult. Analysis shows that these effects are caused by welfare per se, not simply poverty; a poor child without welfare will do better than a similar poor child with welfare.
"Opponents of welfare reform charged that reform would throw millions of children into poverty. In reality, child poverty has dropped substantially since reform was enacted, from 20.8 percent in 1996 to 16.9 percent in 1999." see "Effects of Welfare"
Innumerable other studies done by non-partisan groups like The Urban Institute have found that after the welfare reform of 1996, "average income improved for those on welfare, but little changed for those off welfare or never on welfare." The consequences of welfare reform have been dramatic. As expected, welfare rolls (the number of people receiving payments) dropped significantly (57%) in the years since passage of the bill. Substantially larger declines in welfare rolls were posted by many states, and even big city-dominated Illinois achieved an 86% reduction in welfare recipients. [MacDougal 2005] Child poverty rates for African American families have dropped the sharpest since statistics began to be tallied in the 1960s.
As you can see, Welfare had a negative effect especially in concentrated areas where poverty is greatest, like in the black community. It was only after reform that living conditions for previous welfare recipients improved dramatically. "Surveys of former welfare recipients indicate that they themselves believe their quality of life has improved since leaving welfare, and they are optimistic about their futures. The Manpower Demonstration Research Corporation reveals that a majority of former welfare recipients believe that their lives will be better in one to five years. Many of these recipients actually praise welfare reform for encouraging them to look for work, for giving them a fresh start, and for giving them a chance to make things better for themselves and their children." - Cato
Pollution controls, in the main, haven't worked. If you disagree, please provide some evidence. They most often, as predicted by theoretical models, increased product prices, increased unemployment, and forces companies to move production to places with less restrictions. Same is true for carbon taxes, cap and trade systems, and other methods of pollution control. In general, they have failed utterly. If we want to have any real innovation into stopping climate change, it will have to be through a natural free market way, wherein companies turn "green" because it is profitable. It's already started to happen, with energy companies investing in renewable energy sources and developing better solar and battery tech, or car companies lowering production on large vehicles and increasing investment in hydrogen and hybrid technologies, or businesses investing in sequestering methods to capture emissions voluntarily.
I'm kind of amazed that you should mention Social Security, which has been inefficient for sometime, has assisted in deepening the national deficit, and is heading towards crisis. I personally advocate privately administrated pension saving accounts like those instituted in Chile in the 80s after years of economic stagflation.
"In 1980, the government of Chile decided to take the bull by the horns. A government-run pension system was replaced with a revolutionary innovation: a privately administered, national system of Pension Savings Accounts.
After 15 years of operation, the results speak for themselves. Pensions in the new private system already are 50 to 100 percent higher -- depending on whether they are old-age, disability, or survivor pensions -- than they were in the pay-as-you-go system. The resources administered by the private pension funds amount to $25 billion, or around 40 percent of GNP as of 1995. By improving the functioning of both the capital and the labor markets, pension privatization has been one of the key reforms that has pushed the growth rate of the economy upwards from the historical 3 percent a year to 6.5 percent on average during the last 12 years. It is also a fact that the Chilean savings rate has increased to 27 percent of GNP and the unemployment rate has decreased to 5.0 percent since the reform was undertaken." - http://www.socialsecurity.org/pubs/articles/jp-01-17-96.html
Do you really think the men and women in our armed forces are in that job for the pay?
Some go to serve their country or follow tradition, sure, but most do it to pay for their education. Teachers choose to teach probably because they enjoy it (selfish) and know they can help kids, too. However, relative to teacher vacation times they make very good money. They'd make even more if competition, a meritocracy, was introduced into the system. Also, under the public system, American schools have also failed utterly. I advocate a Friedman-esk voucher system.
I believe an alternative can be found that both allows for a market-driven economy which rewards productive and innovative behavior while also protecting individuals and keeping wealth concentration from getting out of hand.
What exactly in your opinion is "out of hand"? You realize that when Bill Gates makes 30 billion dollars (mostly in the form of stock shares) that poor people don't lose 30 billion dollars? Capitalism is the only system to raise poor people out of poverty and a consequence of the free market is that everyone gets richer (even the rich), and we shouldn't punish people for it. In my personal opinion, I believe we should tax the rich. The income tax originally only taxed the top 1 percent, and that's the way I'd prefer it. A flat tax at around 1% and an income tax of another 10% for the rich (adjusted for what my limited government needs).
A truly worker-run economy, an economy of small businesses, family businesses and farms, non-profits, and cooperatives can completely replace our current system (and probably improve it)
I agree. And a veneer of government and special interest bureaucracy and is not going to help that system.
Stagnation tends to occur when a handful of enterprises manage to eat up the market.*
Your mostly right on this one. The difference is it is nearly impossible (and certainly not desired) to gain a monopoly or triopoly or so on any one product or service without Corporatism, which itself is only possible with government bureaucrats around. Or you could simply elect the Socialist party and have a state run monopoly.
I am going to have to do a large amount of research to disprove your string of demonstrably false assumptions. Expect a lengthy reply in due time.
By the way, for anyone reading this, Hamandcheese's "source", the heritage foundation, states the following:
"Founded in 1973, The Heritage Foundation is a research and educational institute - a think tank - whose mission is to formulate and promote conservative public policies based on the principles of free enterprise, limited government, individual freedom, traditional American values, and a strong national defense."
Not exactly a scientific, un-biased organization to say the least.
Just because I am using a source that has an official stance does not invalidate the source. In other words, instead of attacking the organization (a red herring) attack what they say. Congratulations on being logically inept.
Big corporations aren't inherently bad, but because of the pressures of capitalism they nearly always follow the same negative path in the end. A corporation's job is to make a profit it doesn't really matter how they make it or what they make as long as it makes a profit, and thus corporations don't encourage innovation unless it is truly needed. Why would a corporation risk a possible loss of profit on innovation when what they currently sell produces a profit?
We have seen with the automobile industry that they are not willing to work on innovation until it becomes in the short term profitable. It is obvious that in the long term(decade or more from now), and now in the short term that hybrid vehicles and vehicles with better gas millage are better, and can become profitable, especially in a few years when oil becomes more scarce. the corporations didn't feel a need to innovate in the 90s or a few years back because at the time it didn't seem profitable compared to large SUVs and cars with poor gas mileage.
Some may say that it isn't the purpose of corporations to worry about society and maybe it isn't but if we let corporations have such power over politics then they need to be responsible and beneficial to society. corporations in politics corrupts politics even more. At least in America many will argue that smoking is bad and unhealthy for society as well as the individual but little is seriously done. when was the last time you heard a major politician, especially during election time, arguing against the tobacco corporation let alone actually taking action against it?
Corporations further imperialistic actions by the US government against other nations, as well as those the US government is supposed to be repairing. corporations don't work to help society they work to make money, it is simple and while they may not be intentionally harming other nations and peoples they aren't working to help those people. If the money stops rolling in the corporations will leave. If the corporations do a bad job with their work, and are challenged they will not accept that they failed, they will fight in court until their is a victor, and usually that is the corporation, be it corruption or just vast cash reserves and good lawyers.
Corporate control of the media undermines democracy and and is bound to have bias towards the company if not a political party. Before anyone says that the corporations don't have a bias because they don't brainwash us with images and messages of their products i think we can all realize that they aren't that stupid. as long as a willing political party, or a political party with bias to a corporation has some power that corporation doesn't need to brainwash the majority of American citizens with its products. all it needs to do is control what the citizens know and thus how they react at election time or during any time that strong political action will take places, such as invading another country.
Many American's think that Venezuela is bad, that Cuba is bad, that Palestine is bad and that the Russians can't be trusted but that is because they are only showed images of people of the such nationalities as doing evil things(or things that act against capitalism). they are told that hugo Chavez wants to destroy capitalism and that he hates Americans. they aren't told or shown that American capitalism and its respective corporations have done all they can to stop or prevent Hugo Chavez from realizing is socialist goal. why doess the media do this because the corporations that control it know that its what certain politicians want and if those politicians get elected than they know they will have many contracts in the years to come.
Capitalism forces corporations to make a profit, they are not willing to help society because doing so might risk their profit. Pharmacies aren't going to make the next true breakthrough because sick people generate money for pharmacies so any political action that threatens to harm pharmacies is destroyed because it is not in the interest of those respective corporations. corporations are a major tool of capitalism and capitalism doesn't work without classes of poor, middle and rich. capitalism will never work to stop poverty because it will mean the end of capitalism and seeing as corporations are a tool of capitalism they aren't going to work to help society because it might harm their continued survival let alone the survival of capitalism and in the end corporations are all about profit for that is why they exist.
Case in point, because of the lack of foresight on the part of Chrysler Saint Louis's already shrinking manufacturing base will take another hit: they are closing a minivan plant and putting over a thousand out of work.
I live in Saint Louis; we don't need another factory shut-down. We are already in a panic over one of our larger employers, Busch beer, being taken over by a foreign firm. If that happens we could see it move out of the city; we've already had to wrangle with the company for the longest time, giving it tax breaks and incentives, to stay here.
I think corporations that are multi national are bad. It is unfair to the working people in this society to have these businesses exploiting the cheap labor and resources in another country and reselling them in our country. I'm not saying that they shouldn't be able to purchase goods and materials from businesses in other countries but a person shouldn't be able to own a business in America and one overseas.
If they are selling their goods in America as an American business they should have to follow American employment laws. Owning businesses outside of America allows corporations to circumvent American laws. It also robs the hosting countries because they can't claim ownership to the products they produce in order to sell them for competitive prices. If American corporations want to sell foreign produced goods they should have to buy them from the foreign countries/businesses and pay tariffs on the products.
The fact that big corporations do exploit cheap labor from other countries shows us how dangerous their size and multi nationality is. No longer are these corporations willing to work by the rules of our government. It is clear that they are not loyal to America and yet we are allowing them to expand out of control. We even pay them almost $150 Billion a year in corporate welfare. I just wonder if these corporations would still be in America if we ever hit a severe depression; but I guess they might if they could exploit us for cheap labor.
I believe in a free-market. But I don't believe we should allow it to be manipulated by businesses bigger than our market. If a business is operating in America it should only operate in America. They would have to consider the implications of their actions if they are dependent on our market. If a corporation is multi national they are less affected by America's economy and thus less reflective of that economy.
The core problem with corporations is that we turn over enormous economic and political power to entities over which we have no control, power which rightfully belongs with the elected government, which is us.
Big corporations are not universally bad, indeed many large corporations contribute to the high level of convenience we enjoy as consumers. A large corporation holds powerful buying power that is returned to consumers as low, affordable prices on various necessary or unnecessary products. Large corporations also facilitate the delivery of cultural meccas such as motion pictures and television programs. Without large, big profit corporations it would be difficult to be entertained by high budget shows such as Heroes or Grey's Anatomy every week.
Having said that, the corporate structure that is so pervasive in our economy dispenses a unique brand of social, political and environmental injustices on an unwitting public.
Corporations are bound to the will of the share holder, whose primary investment goal is to see their stock. For this reason the corporate structure must remain in a perpetual state of growth to ensure continued investment. A CEO of any given corporation will particularly feel the heat to grow. Considering the often short life span of their jobs, CEO will be more than motivated to make a large profits in a short period of time.
Big profits and continuous growth leads the corporate world to seek whatever advantage is available. If labourers will work for literally peanuts in South Asia, then setting up a factory overseas just makes good business sense. Of course there is little concern for working conditions or fair wages, that sort of defeats the purpose.
Regulations, particularly those pesky environmental ones, are sometimes view as road blocks to a windfall of profit. While there maybe some regulations in place that are unfair to business, the majority of regulations are in place to protect the environment, or uphold fair business practices. Corporations have the ability, however, have a disproportionate voice compared to the people to lobby for their interests through the government. To lobby isn't always a bad thing, but a corporation will typically be able to afford smarter, more experienced lobbyists than say an environmental group.
Large corporations aren't a bad thing, but there needs to be a better balance between their needs and the needs of the environment, and the environment.
The only ones who have a logical argument is the people at the top of these corporations. Sure, they create jobs, but the people who used to be middle class working at these jobs are losing more and more every year while the CEO's keep making more. Prime example would be Walmart. A department head at Walmart will make between 11-14$ per hour. Store managers can make up to 200k. Another example, Albertsons used to pay their grocery managers and department heads 60-70k per year. Now a starting grocery manager can expect to make 42k per year, and a department head will make about 33k. Now tell me these corporations are helping us out. These jobs used to be able to support a four person household. Not anymore! And who is reaping the benny's out of this? The stockholders and higher level management. Wake up America! If you look back 15 years ago at these wages you could have a pretty comfortable living situation. Especially since housing was only a fraction of what it is today, gasoline was 99 cents, food was literally half the cost. The middle class getting the shaft for 15 years! Sure would be nice if we ever got some of the middle class into our government to run things for a change!!!!!
Well, a corporation is a company that is treated by law in much the same way as a person, except that it cannot be imprisoned. Corporations are sometimes criticized as being "faceless" organizations run by executives and shareholders who do not care about their customers or employees. It is ironic that many of these critics view government ownership or regulation of industry as the solution, since government is another huge organization, the major difference being that except in the closest of elections, its rulers have less incentive than industry to be concerned about the wishes of an individual citizen.
Big Corporations are driven by profit alone. They are legally bound to do what is most profitable, otherwise their shareholders could sue. Big Corporations don't care if you have fast internet or cable tv. They only care about you giving your money to them. They'll fire you and outsource because it makes their margins better. They don't really care about their employees, they don't really care about values. If you want cheap stuff then they're good, but don't think about what corners were cut to get you it cheap.
The profit motive is not a legitimate attack on "big corporations." The facts are that what is profitable correlates directly with consumers needs. Some companies do cut corners, it's true. And they are usually very open about it, and if not health agencies or product reviewers will normally catch on and report it.
In other words, it allows the educated consumer the choice between super cheap (in every sense of the word) stuff, or competitively priced good stuff. In reality, if competition wasn't a factor the people buying the low quality stuff now would probably not be able to afford any such stuff at all.
That's a sweet interview because the interviewer askes the question that we all think of, and then the interviewee gives the most logical answer to the question and is honest about it... and he's right.
While I wish that humanity's success didn't stem from greed, I have to say that greed is stable and quite dedicated to sustaining itself.
Big corporation (and also their shareholder) cares about "long term" profit. That explains why they will not encourage opportunistic behaviour. CEOs of big corporation, on the other hands, are driven by power. They might mis-use the power of The big corporation. if it happens, big corporation hopelessly become related culprit of the plot.
So the best way is to make sure no Big Corporation monopolize the market they are in.
Big corporations crush small companies stopping them from becoming bigger. They exploit forien workers paying them very little amounts of money. Also big corporations are corrupt and can effect government decisions eg. when george bush started the war on terror he made ALOT of money from the shares he had with the defence contractors.
