Stupid Pilot Tricks - Insurance Co. Trying to Back Out

[Bob Chilcoat]

Apparently, the insurance co of the pilot who lost his amphibious float
plane on landing (see "Stupid Pilot Tricks" and Followup a couple of weeks
ago) and parked it in a hangar with a Comanche already inside, is trying to
get out of paying anything since the pilot was on drugs. Not surprising,
but that leaves the owners of the two other planes involved and the airport
(hangar owners) with no recourse but to claim on their own insurance. I
guess this is just the way it works, but it's a shame that the pilot's
insurance won't at least pay the innocent parties' claims and then go after
the pilot themselves.

--
Bob (Chief Pilot, White Knuckle Airways)

I don't have to like Bush and Cheney (Or Kerry, for that matter) to love
America

[Mike Rapoport]

"Bob Chilcoat" > wrote in message
...
> Apparently, the insurance co of the pilot who lost his amphibious float
> plane on landing (see "Stupid Pilot Tricks" and Followup a couple of weeks
> ago) and parked it in a hangar with a Comanche already inside, is trying
> to
> get out of paying anything since the pilot was on drugs. Not surprising,
> but that leaves the owners of the two other planes involved and the
> airport
> (hangar owners) with no recourse but to claim on their own insurance. I
> guess this is just the way it works, but it's a shame that the pilot's
> insurance won't at least pay the innocent parties' claims and then go
> after
> the pilot themselves.
>
> --
> Bob (Chief Pilot, White Knuckle Airways)
>
> I don't have to like Bush and Cheney (Or Kerry, for that matter) to love
> America
>

Why should they pay a claim if they are not required to? If the policy
isn't in force if the pilot is on drugs, then the parked planes were hit by
an uninsured pilot. The insurance company is not insuring the damaged
planes, it is insuring the pilot who caused the accident and, even then,
only subject to various requirments. I agree that it is unfortunate for the
victums.

Mike
MU-2

[Andrew Gideon]

Mike Rapoport wrote:

> The insurance company is not insuring the damaged
> planes, it is insuring the pilot who caused the accident and, even then,
> only subject to various requirments. I agree that it is unfortunate for
> the victums.
>

As much annoyance as we might carry towards insurance companies, it is
important to remember just who here is the cause. The insurance company is
just trying to avoid becoming another victim of this person's Darwin Award
attempt.

- Andrew

[AES/newspost]

In article >,
"Mike Rapoport" > wrote:

> Why should they pay a claim if they are not required to?

Fair question -- but from a broader social point of view, if an
expensive object (like an airplane) that has some small but significant
change of causing massive damage to innocent third parties is going to
be exist and be operated at all, maybe (or for sure, IMHO) it should be
impossible for it to operate, or even exist, without at least liability
coverage for damage to others.

So maybe a legislative requirement on any company providing any kind of
aviation related insurance should be that all their policies must always
contain third-party liability coverage -- insurance on a plane should be
required to include liability coverage for others no matter who operates
it (even if it's stolen); insurance on a pilot should include liability
coverage for others, no matter what plane he operates (or in what
condition).

My impression is that in Europe auto insurance coverage goes with the
car, not the driver. If so, good idea.

Our governor just vetoed drivers license for undocumented immigrants on
grounds of inadequate insurance provisions: also a good idea,
independent of views on whether undocumented immigrants should be given
drivers licenses at all.

[zatatime]

On Wed, 29 Sep 2004 10:27:14 -0700, AES/newspost
> wrote:

>My impression is that in Europe auto insurance coverage goes with the
>car, not the driver. If so, good idea.

New Jersey has this type of insurance as well.

z

[Andrew Gideon]

zatatime wrote:

> On Wed, 29 Sep 2004 10:27:14 -0700, AES/newspost
> > wrote:
>
>>My impression is that in Europe auto insurance coverage goes with the
>>car, not the driver. If so, good idea.
>
> New Jersey has this type of insurance as well.

Is this related to the fact that we've so much trouble getting/keeping
companies to do insurance business here? Or is this unrelated?

- Andrew

[C Kingsbury]

"AES/newspost" > wrote in message
...

> So maybe a legislative requirement on any company providing any kind of
> aviation related insurance should be that all their policies must always
> contain third-party liability coverage -- insurance on a plane should be
> required to include liability coverage for others no matter who operates
> it (even if it's stolen); insurance on a pilot should include liability
> coverage for others, no matter what plane he operates (or in what
> condition).

Great idea. After all, there are far too many insurance companies writing
small plane coverage and they're charging way too little for it.

> My impression is that in Europe auto insurance coverage goes with the
> car, not the driver. If so, good idea.

Absolutely! Because we all know most accidents are caused by cars, not
drivers. While we're at it, why not get rid of car insurance all together
and mandate that the electric company get insurance for those lightposts
that are always jumping in front of cars?

-cwk.

[C Kingsbury]

Yes, and in New Jersey you can probably insure a $50,000 Cessna for less
than a $50,000 Lexus, with higher liability limits to boot.

"zatatime" > wrote in message
...
> On Wed, 29 Sep 2004 10:27:14 -0700, AES/newspost
> > wrote:
>
> >My impression is that in Europe auto insurance coverage goes with the
> >car, not the driver. If so, good idea.
>
> New Jersey has this type of insurance as well.
>
> z

[Ron Natalie]

"C Kingsbury" > wrote in message ink.net...
>
> Yes, and in New Jersey you can probably insure a $50,000 Cessna for less
> than a $50,000 Lexus, with higher liability limits to boot.
>
The fact that the NJ auto insurance follows the car has no bearing on the
fact that the insurance situation up there is a citole. The problem is that
the legislature is full of personal injury lawyers and the insurance system is
the screwiest half-assed no-fault ever seen which pretty much encourages
everybody to go to court. Most companies won't write coverage there if
they can avoid it which means that a third of the state's drivers are in an
equally corruptly administered uninsured drivers pool.

My insurance dropped to 25% of what it was before when I moved from NJ
to VA. My insurance company always insured both me (in other people's cars)
and my car (when other people drive) in both states.

[G.R. Patterson III]

Andrew Gideon wrote:
>
> Is this related to the fact that we've so much trouble getting/keeping
> companies to do insurance business here? Or is this unrelated?

No, and things have improved in that regard since Florio was voted out. There were
two main reasons for the problems there.

One - because it was argued that premiums paid by NJ drivers somehow supported lower
premiums elsewhere in the country, only New Jersey companies could write auto
insurance here. That led to a number of national companies spinning off subsidiaries
(eg. Aetna wrote policies as Aetna of New Jersey). It also made it easier for various
fat cats to play protection games with the companies, but corruption is hard to
prove. It also turned out that, to some extent, premiums charged elsewhere in the
U.S. were supporting lower premiums in NJ simply by expanding the risk base. This
restriction was eliminated (or at least relaxed) in the Whitman administration, and I
now have insurance with a Delaware branch of AIG.

Two - because it was argued that unfairly high premiums were being charged to allow
companies to make more money in other investments, the State required that the
majority of the premiums be kept as liquid assets to pay claims. As it turns out, the
profit on investments (when there is profit) subsidizes premiums and keeps them lower
than they otherwise would be. Forcing a company to pay claims completely out of
premiums increased the premiums. When Florio put caps on rates, some companies just
gave up. I do not know what has changed in those regulations, but they couldn't have
kept it like that and allow out-of-state companies into the market, so I believe it's
been changed.

One thing Florio did that helped keep insurance companies from leaving was his "bad
driver" measures. Basically, if you make a claim on your auto insurance, this will
result in surcharges by the State, most of which are returned to your insurance
company. Own a 5 year old car, hit some ice and wrap it around a tree, and that
accident will result in surcharges over the next three years that will approximately
equal the settlement you get from your collision insurance. Another measure involves
traffic tickets. Pick up a few tickets, and that will result in surcharges that go
into a pool to underwrite insurance for people who would otherwise find it hard to
get a policy.

George Patterson
If a man gets into a fight 3,000 miles away from home, he *had* to have
been looking for it.

[Big John]

zatatime

Ditto Texas.

Big John

On Wed, 29 Sep 2004 17:33:52 GMT, zatatime
> wrote:

> On Wed, 29 Sep 2004 10:27:14 -0700, AES/newspost
> wrote:
>
>>My impression is that in Europe auto insurance coverage goes with the
>>car, not the driver. If so, good idea.
>
>New Jersey has this type of insurance as well.
>
>z

[OtisWinslow]

Probably in many states you can. It costs me $21 per $1000 in value for my
airplane. It costs
me $28 per $1000 in value for my car.



"Ron Natalie" > wrote in message
m...
>
> "C Kingsbury" > wrote in message
> ink.net...
>>
>> Yes, and in New Jersey you can probably insure a $50,000 Cessna for less
>> than a $50,000 Lexus, with higher liability limits to boot.
>>
> The fact that the NJ auto insurance follows the car has no bearing on the
> fact that the insurance situation up there is a citole. The problem is
> that
> the legislature is full of personal injury lawyers and the insurance
> system is
> the screwiest half-assed no-fault ever seen which pretty much encourages
> everybody to go to court. Most companies won't write coverage there if
> they can avoid it which means that a third of the state's drivers are in
> an
> equally corruptly administered uninsured drivers pool.
>
> My insurance dropped to 25% of what it was before when I moved from NJ
> to VA. My insurance company always insured both me (in other people's
> cars)
> and my car (when other people drive) in both states.
>

[Richard Hertz]

"AES/newspost" > wrote in message
...
> In article >,
> "Mike Rapoport" > wrote:
>
> > Why should they pay a claim if they are not required to?
>
> Fair question -- but from a broader social point of view, if an
> expensive object (like an airplane) that has some small but significant
> change of causing massive damage to innocent third parties is going to
> be exist and be operated at all, maybe (or for sure, IMHO) it should be
> impossible for it to operate, or even exist, without at least liability
> coverage for damage to others.
>
> So maybe a legislative requirement on any company providing any kind of
> aviation related insurance should be that all their policies must always
> contain third-party liability coverage -- insurance on a plane should be
> required to include liability coverage for others no matter who operates
> it (even if it's stolen); insurance on a pilot should include liability
> coverage for others, no matter what plane he operates (or in what
> condition).
>
> My impression is that in Europe auto insurance coverage goes with the
> car, not the driver. If so, good idea.
>
> Our governor just vetoed drivers license for undocumented immigrants on
> grounds of inadequate insurance provisions: also a good idea,
> independent of views on whether undocumented immigrants should be given
> drivers licenses at all.

Yeah, that's what we need, more government intervention. They do such a
good job when they interfere with the market.

What you are saying makes sense to me - insure everything. Europe is
great - I can't wait for the government in the US to finally convert totally
to socialism. It will be such a huge step forward for us.

[Friedrich Ostertag]

Hi NG,

> So maybe a legislative requirement on any company providing any kind
> of aviation related insurance should be that all their policies must
> always contain third-party liability coverage -- insurance on a plane
> should be required to include liability coverage for others no matter
> who operates it (even if it's stolen); insurance on a pilot should
> include liability coverage for others, no matter what plane he
> operates (or in what condition).
>
> My impression is that in Europe auto insurance coverage goes with the
> car, not the driver. If so, good idea.

Yes, that's the case in Germany. To register a car you are required to
have an insurance that will cover any damage to others caused with this
car, no matter how reckless the driver or whatever the circumstances.
They will afterwards try to reclaim the damage from the driver or
whoever they see not complying with requirements. Could also be the
person who registered the car, if he didn't take proper precautions to
prevent unauthorized use for example. But whoever suffers damage from
this car will receive compensation.

Definitely a good idea.

regards,
Friedrich

--
for personal email please remove "entfernen" from my adress

[Icebound]

"Richard Hertz" <no one@no one.com> wrote in message
et...
>
> "AES/newspost" > wrote in message
> ...
> > In article >,
> > "Mike Rapoport" > wrote:
> >
....snip...
>
> > My impression is that in Europe auto insurance coverage goes with the
> > car, not the driver. If so, good idea.
> >
> > Our governor just vetoed drivers license for undocumented immigrants on
> > grounds of inadequate insurance provisions: also a good idea,
> > independent of views on whether undocumented immigrants should be given
> > drivers licenses at all.
>
> Yeah, that's what we need, more government intervention. They do such a
> good job when they interfere with the market.
>
> What you are saying makes sense to me - insure everything. Europe is
> great - I can't wait for the government in the US to finally convert
totally
> to socialism. It will be such a huge step forward for us.
>
>

If insurance is such a "socialist" concept, why do we use it at all?

There are many brands of "socialism", some within dictatorships..... but
many within democracies, something that seems to escape a lot of us.

The definitions range everything from:
"The set of beliefs which states that all people are equal...." which I am
sure you would not dispute, to:
"the...[economy]...is owned collectively or by a centralized government that
plans and controls it...."

Under some of the definitions, "of the people, by the people, for the
people", can sound like a pretty "socialist" concept, especially when I have
to assume that the constitution did not intend to leave anyone out, did
it??... and the real interpretation must be: "of ALL the people, by ALL the
people, for ALL the people".


It means that citizens help other citizens, sharing their skill and good
fortune with the less able (ie: "the people"). In most civilized circles
that is considered a "good" thing.

Perhaps a return to those concepts WOULD be "a huge step forward".

The pure "market" is not so perfect, either, producting its own set of
problems. It continues to concentrate wealth, and spread the gap between
rich and poor.... If that continues, (and right now there is no indication
that it will not), the ultimate result will be civil revolution... just a
matter of whether it is reached in fifteen years, or a hundred and fifteen.

Unless, of course, the "government" clamps down on the revolutionaries with
military might, in which case we have something akin to feudalism or
dictatorship, as in any number of countries you could point at recently, or
even today.

The founding Fathers wrote in some stuff to prevent that. I hope it is
still holding up???

--
*** A great civilization is not conquered from without until it
has destroyed itself from within. ***
- Ariel Durant 1898-1981

[Aviv Hod]

<snip>
>
> It means that citizens help other citizens, sharing their skill and good
> fortune with the less able (ie: "the people"). In most civilized circles
> that is considered a "good" thing.

Yes, it is generally considered a "good thing", but forcing that
"sharing of skill and good fortune" is anathema to many people. Most
people realize that it's in their self interest to share some, but they
would like to exert control on the extent of the sharing. When
government goes and shares YOUR wealth beyond what you would do on your
own, there are some sour grapes.

> Perhaps a return to those concepts WOULD be "a huge step forward".
>
> The pure "market" is not so perfect, either, producting its own set of
> problems. It continues to concentrate wealth, and spread the gap between
> rich and poor.... If that continues, (and right now there is no indication
> that it will not), the ultimate result will be civil revolution... just a
> matter of whether it is reached in fifteen years, or a hundred and fifteen.

I am flabbergasted every time that I hear the argument that "the market
system concentrates wealth", implying that there is a zero sum game
called "the market" where some people are the winners and everyone else
loses. The market system is the only system where all the participants,
under normal circumstances, benefit from their engagement in commerce
more than before their engagement. The exchange itself CREATES value,
and we go beyond that zero sum. Does the market create the opportunity
for some individuals to become extremely wealthy? Sure - but it's NOT
because of skin off of anyone else's back. So we have a bunch of people
that benefited from their engagement in the market now more wealthy than
before, and some that also benefited from their engagement in the market
to a greater extent, sometimes becoming very wealthy. What is
inherently wrong with that? There might be a large gap, but the fact
remains that those at the bottom are still better off than before. In a
well regulated market (which bars monopoly and dishonesty), the overall
effect is that everyone is better off.

The best feature of the market economy and freedom is that rich and poor
do not remain in either of those classes for very long. There is
economic mobility that sees people creating value and becoming richer
and rich people that become complacent and become poorer. This is why a
revolution is NOT inevitable, as you suggest. Why have a revolution
that makes us all equal, but equally miserable, when I could work a
while, start a business, and bring myself and my family to riches?

>
> Unless, of course, the "government" clamps down on the revolutionaries with
> military might, in which case we have something akin to feudalism or
> dictatorship, as in any number of countries you could point at recently, or
> even today.

Whoa, hold on there. There is no need for revolution. This is a
democratic country - those "revolutionaries" could simply run for
office. Luckily their ideas are so far removed from the values of most
Americans that they won't stand a chance in hell getting elected. We
know what has made this country great, and it's not government control
of the economy!


> The founding Fathers wrote in some stuff to prevent that. I hope it is
> still holding up???

Yes, the founding fathers wrote in some pretty neat stuff about
governing this nation, protecting freedom of speech, while at the same
time protecting EVERYONE's life and liberty. That excludes
"revolutionaries" that wish to impose their will on others by means
other than democratic election. The government does not have the
authority to "clamp down on revolutionaries with military might" under
our constitution unless they are breaking the law. So the Communist
Party USA can operates as freely as it wants, so long as they are not
breaking any laws. Laws that are checked by our judicial branch and
that must be constitutional. Although it is constantly under
bombardment, the constitution is still holding up.

How well would it hold up under socialism/communism? I assert that it
couldn't.

-Aviv

[Peter Duniho]

"Aviv Hod" > wrote in message
...
> [...] The market system is the only system where all the participants,
> under normal circumstances, benefit from their engagement in commerce more
> than before their engagement. The exchange itself CREATES value, and we
> go beyond that zero sum. Does the market create the opportunity for some
> individuals to become extremely wealthy? Sure - but it's NOT because of
> skin off of anyone else's back.

Your description sounds great. I wish that's how things really worked. The
truth is that the wealthy use their wealth to protect their wealth, even to
increase it, while at the same time to prevent the poor from getting
wealthy.

Does every wealthy person behave this way? No. But plenty do, and enough
do that it's a serious problem. Only in a first grade schoolchild's fantasy
is it true that everyone has equal opportunity, and any random poor person
can become wealthy through simple hard work and perseverence.

See Kevin Phillips "Wealth and Democracy", as a starting point.

Pete

[Mike Rapoport]

If you look at who is wealthy in the US you will notice that the list is
constantly changing and that most of them made their own way. This doesn't
support the notion that the wealthy are locked in and the poor are locked
out. I don't think that anyone would say the playing field is level anymore
than it is level in athletics or looks. It is not a perfect system by any
means but it seems to be better than any other system.

The "poor" around here are the ones who don't work or don't show up for work
during hunting season or when there is a foot of powder at the ski resort.
They are the ones who have four children by age 25. They are the ones who
have jet skis, snowmobiles, atvs and other leisure items that they don't
really "need" but purchased on credit anyway. Their work habits preclude
their incomes rising and their spending and lifestyle habits preclude
retaining any of what they do earn. I don't see any wealthy people
preventing them from succeeding.

Mike
MU-2


"Peter Duniho" > wrote in message
...
> "Aviv Hod" > wrote in message
> ...
>> [...] The market system is the only system where all the participants,
>> under normal circumstances, benefit from their engagement in commerce
>> more than before their engagement. The exchange itself CREATES value,
>> and we go beyond that zero sum. Does the market create the opportunity
>> for some individuals to become extremely wealthy? Sure - but it's NOT
>> because of skin off of anyone else's back.
>
> Your description sounds great. I wish that's how things really worked.
> The truth is that the wealthy use their wealth to protect their wealth,
> even to increase it, while at the same time to prevent the poor from
> getting wealthy.
>
> Does every wealthy person behave this way? No. But plenty do, and enough
> do that it's a serious problem. Only in a first grade schoolchild's
> fantasy is it true that everyone has equal opportunity, and any random
> poor person can become wealthy through simple hard work and perseverence.
>
> See Kevin Phillips "Wealth and Democracy", as a starting point.
>
> Pete
>

[Peter Duniho]

"Mike Rapoport" > wrote in message
nk.net...
> If you look at who is wealthy in the US you will notice that the list is
> constantly changing and that most of them made their own way.

Don't take my comments personally. Just because you're rich, that doesn't
mean I think you personally are driving this country to ruin.

If you look at the wealthiest and most powerful in our country, they all
came from wealth. The idea that "the list is constantly changing" is
laughable. The *order* of the people on the list does change, but the
people who are on that list doesn't change very much at all.

> [...] It is not a perfect system by any means but it seems to be better
> than any other system.

That is certainly debatable, but I won't bother...I've already done too much
off-topic here.

> The "poor" around here are the ones who don't work or don't show up for
> work > during hunting season or when there is a foot of powder at the ski
> resort.

Ahh, yes...must be nice to live somewhere that doesn't have truly
poverty-stricken people. Suffice to say, there are plenty of urban areas in
the US where the poor are a lot worse off than the ones near your mountain
getaway, and for most of whom all they did wrong was to be born into the
wrong economic class.

There certainly are lazy people around, and they often wind up poor (but
there's lots of lazy rich people too). But to assert that if you are poor,
you are obviously lazy is just plain ignorant.

Pete

[Mike Rapoport]

"Peter Duniho" > wrote in message
...
> "Mike Rapoport" > wrote in message
> nk.net...
>> If you look at who is wealthy in the US you will notice that the list is
>> constantly changing and that most of them made their own way.
>
> Don't take my comments personally. Just because you're rich, that doesn't
> mean I think you personally are driving this country to ruin.
>
> If you look at the wealthiest and most powerful in our country, they all
> came from wealth. The idea that "the list is constantly changing" is
> laughable. The *order* of the people on the list does change, but the
> people who are on that list doesn't change very much at all.
>
>> [...] It is not a perfect system by any means but it seems to be better
>> than any other system.
>
> That is certainly debatable, but I won't bother...I've already done too
> much off-topic here.
>
>> The "poor" around here are the ones who don't work or don't show up for
>> work > during hunting season or when there is a foot of powder at the ski
>> resort.
>
> Ahh, yes...must be nice to live somewhere that doesn't have truly
> poverty-stricken people. Suffice to say, there are plenty of urban areas
> in the US where the poor are a lot worse off than the ones near your
> mountain getaway, and for most of whom all they did wrong was to be born
> into the wrong economic class.
>
> There certainly are lazy people around, and they often wind up poor (but
> there's lots of lazy rich people too). But to assert that if you are
> poor, you are obviously lazy is just plain ignorant.

I am not saying poor people are lazy, or even those that I was describing
are lazy. Some are and some aren't. Hunting and skiing are harder than
most jobs. These people aren't lazy, they are just making decisions that
limit their financial success. I wouldn't even go so far as to say thay
they are making poor choices. All I am saying is that the choices that they
have made have put them in a different situation than people with the same
skills who made different choices.

An aquaintance of mine's wife is African-American, grew up in rural Alabama
to uneducated parents in a shack with no electricity or any plumbing. She
is now a vice president of a Fortune 100 company. I grew up in an
upper-middle class area, went to public schools, went to a state university
that was paid for through student loans and a job and went on to be
relatively successful. Did my aquaintance's wife overcome more obstacles
than I did? Certainly. But the fact is that she made it because of the
chioces she made and the inate intelligence she started with..

I know a lot of high school educated people from very modest backgrounds who
are fairly successful. The only difference that I can see between them and
those I described previously is that they made, and continue to make,
different choices. The lifestyle choices that will deliver better long term
financial outcomes are well known but people continue to make the opposite
choices. That is their right and their choice but the outcome is theirs as
well. It would be interesting to know what the outcomes of those who make
the same choices are. How many people who, by choice, did not finish high
school, had two or more children by age 25, use credit to buy un-needed
consumable items end up successful regardless of their background? How many
who made the opposite choices ended up in poverty? I believe that the
answer would show that the choices we make have more bearing on where we end
up than what we start with.

Mike
MU-2

[FullName]

AES/newspost > wrote in news:siegman-
:

> In article >,
> "Mike Rapoport" > wrote:
>
>> Why should they pay a claim if they are not required to?
>
> Fair question -- but from a broader social point of view,

Just say no to Socialism.. and bigger government

[Icebound]

"Aviv Hod" > wrote in message
...
>
> <snip>
> >
> > It means that citizens help other citizens, sharing their skill and good
> > fortune with the less able (ie: "the people"). In most civilized
circles
> > that is considered a "good" thing.
>
> Yes, it is generally considered a "good thing", but forcing that
> "sharing of skill and good fortune" is anathema to many people. Most
> people realize that it's in their self interest to share some, but they
> would like to exert control on the extent of the sharing. When
> government goes and shares YOUR wealth beyond what you would do on your
> own, there are some sour grapes.

....by those who do not accept that "it's in their self interest to share
some..." We can argue endlessly as to what is the appropriate share.

>
> > Perhaps a return to those concepts WOULD be "a huge step forward".
> >
> > The pure "market" is not so perfect, either, producting its own set of
> > problems. It continues to concentrate wealth, and spread the gap
between
> > rich and poor.... If that continues, (and right now there is no
indication
> > that it will not), the ultimate result will be civil revolution... just
a
> > matter of whether it is reached in fifteen years, or a hundred and
fifteen.
>
> I am flabbergasted every time that I hear the argument that "the market
> system concentrates wealth", implying that there is a zero sum game
> called "the market" where some people are the winners and everyone else
> loses. The market system is the only system where all the participants,
> under normal circumstances, benefit from their engagement in commerce
> more than before their engagement. The exchange itself CREATES value,
> and we go beyond that zero sum.

It is not the exchange that creates value. It is the work, the labour.
Free Enterprise encourages one to work, and I work to do something that you
need and in return you work to do something that I need, and we are both
better off and have something which we did not have before. The value of
your work was directly proportional to the "increased wealth" that it
created.

As long as Free Enterprise followed somewhat along that model, things worked
fine. It was very difficult for me to hide the value of my work from you,
or you to do so from me.

But along came big corporations and we shifted from placing a value on your
labour in terms of the incremental benefit it provides, and instead we
valuate it like any commodity.... if it is plentiful, we buy it low, use it,
sell its benefits high, and when we are done, we discard it.. It is no
longer "people", it is commodity. We have written it out of the equation as
far as being a "partner" in the creation of this wealth.

Instead, we place a "value" of your "company" and its "potential". This
"Value" that the Exchange creates can be very false, as in, say, Enron. Or
Nortel, Yahoo, about any other tech company pre-early-2000. I would say THAT
little piece of market history certainly WAS a zero-sum game with winners
and losers, even a negative-sum game.

>Does the market create the opportunity
> for some individuals to become extremely wealthy? Sure - but it's NOT
> because of skin off of anyone else's back. So we have a bunch of people
> that benefited from their engagement in the market now more wealthy than
> before, and some that also benefited from their engagement in the market
> to a greater extent, sometimes becoming very wealthy. What is
> inherently wrong with that?

Maybe nothing. Unless, as pointed out above, the share of the total benefit
that resulted from that market "engagement" was inappropriately divided
amongst the players. Maybe the "very wealthy" would only have become
"moderately wealthy", had the benefits been divided equitably. We can argue
endlessly about what constitutes an equitable division.

>There might be a large gap, but the fact
> remains that those at the bottom are still better off than before. In a
> well regulated market (which bars monopoly and dishonesty), the overall
> effect is that everyone is better off.
>

"Which bars monopoly and dishonesty...." Isn't it interesting that the "free
market" has been unable to do this, with quite spectacular results for some
of those investors (and workers) who were hoping to benefit from its
"opportunity"...


> The best feature of the market economy and freedom is that rich and poor
> do not remain in either of those classes for very long. There is
> economic mobility that sees people creating value and becoming richer
> and rich people that become complacent and become poorer.

Very true in the original Free Enterprise model where my labour and your
labour were valued by their contribution to the increase in wealth. Less
so, today, because they are not, they are valued as a commodity. Very
difficult to live my life over.... if I chose a skill that looked good 10
years ago, and puts me on amongst the pink slips today, very difficult to
have "economic mobility"...


> This is why a
> revolution is NOT inevitable, as you suggest. Why have a revolution
> that makes us all equal, but equally miserable, when I could work a
> while, start a business, and bring myself and my family to riches?
>

A revolution is not inevitable because, first of all, the government is a
lot more Socialist that it cares to admit. Minutes ago there was an
announcement that Mel Brooks will shoot a film version of "The Producers" in
New York, because of new Tax breaks for the film industry.

It is also not inevitable because, once in a long while, some sanity does
prevail amongst the electorate and the elected.

> >
> > Unless, of course, the "government" clamps down on the revolutionaries
with
> > military might, in which case we have something akin to feudalism or
> > dictatorship, as in any number of countries you could point at recently,
or
> > even today.
>
> Whoa, hold on there. There is no need for revolution. This is a
> democratic country - those "revolutionaries" could simply run for
> office. Luckily their ideas are so far removed from the values of most
> Americans that they won't stand a chance in hell getting elected.

"could simply run for office..." Well, yes, they could, provided they had
the money to do so.

Democracy used to pretend to work that way, but a few things have changed.
For one, a long time ago, the mainstream media use to educate the public
about the policy proposals, and would provide a myriad of editorial
opionions about the perceived consequences. The media today has merged into
just a few (loud and obnoxious) voices that has largely abandoned rational
thought in favor of partisan political spin. They have totally abrogated
their watch-dog responsibilities in favor of scooping the sensational,
sound-biting the important, and dwelling on the incidental.... It has become
more important to sell a lot of Viagra or whatever, than to inform the
public.

It is pretty hilarious that the most rational political debates probably
occur on the late-night-comedy talk shows.


>We know what has made this country great, and it's not government control
> of the economy!

Yes, I notice that. See the discussion of Governor Pataki and tax breaks,
above, or search google about farm and lumber subsidies, for a start.



>
>
> > The founding Fathers wrote in some stuff to prevent that. I hope it is
> > still holding up???
>
> Yes, the founding fathers wrote in some pretty neat stuff about
> governing this nation, protecting freedom of speech, while at the same
> time protecting EVERYONE's life and liberty. That excludes
> "revolutionaries" that wish to impose their will on others by means
> other than democratic election. The government does not have the
> authority to "clamp down on revolutionaries with military might" under
> our constitution unless they are breaking the law.

.... mmm ... I'd like to think that. But they DO have the right to "clamp
down" and invade the privacy of people who are NOT breaking the law, but are
under suspicion that they MIGHT do so one day in the unspecified future???


> So the Communist
> Party USA can operates as freely as it wants, so long as they are not
> breaking any laws. Laws that are checked by our judicial branch and
> that must be constitutional. Although it is constantly under
> bombardment, the constitution is still holding up.
>
> How well would it hold up under socialism/communism? I assert that it
> couldn't.
>
>

Of, for sure not, under a socialist or communist dictatorship.... But be
very careful that democracy-for-the-well-connected,
Free-Enterprise-but-not-quite-for-everybody, or
Freedom-if-you're-not-suspicious.... does not slowly slide into
dictatorship, also.


--
*** A great civilization is not conquered from without until it
has destroyed itself from within. ***
- Ariel Durant 1898-1981

[Andrew Gideon]

Icebound wrote:

> It is not the exchange that creates value. It is the work, the labour.

In fact, it is both. If you have something that you value at 10 but I value
at 15, and I buy it from you for 12, then the net value has increased: I've
gained 3 and you've gained 2.

This doesn't only apply to things; services are subject to the same effect.

This is also why investment works. I give you 10 to use for a while. You
use it to make 5 more, and pay me back 12.

Sure, work plays a role too. But if we assume that you bought labor
(another word for "service") with that 10 I loaned to you, then absent the
loan of 10 that service could never have been purchased.

- Andrew

[Bush]

Bob:

That was the fine print on page 13 of the Avemco insurance policy.

Have a great one!

Bush

On Wed, 29 Sep 2004 11:47:04 -0400, "Bob Chilcoat"
> wrote:

>Apparently, the insurance co of the pilot who lost his amphibious float
>plane on landing (see "Stupid Pilot Tricks" and Followup a couple of weeks
>ago) and parked it in a hangar with a Comanche already inside, is trying to
>get out of paying anything since the pilot was on drugs. Not surprising,
>but that leaves the owners of the two other planes involved and the airport
>(hangar owners) with no recourse but to claim on their own insurance. I
>guess this is just the way it works, but it's a shame that the pilot's
>insurance won't at least pay the innocent parties' claims and then go after
>the pilot themselves.

[Aviv Hod]

Peter Duniho wrote:
> "Aviv Hod" > wrote in message
> ...
>
>>[...] The market system is the only system where all the participants,
>>under normal circumstances, benefit from their engagement in commerce more
>>than before their engagement. The exchange itself CREATES value, and we
>>go beyond that zero sum. Does the market create the opportunity for some
>>individuals to become extremely wealthy? Sure - but it's NOT because of
>>skin off of anyone else's back.
>
>
> Your description sounds great. I wish that's how things really worked. The
> truth is that the wealthy use their wealth to protect their wealth, even to
> increase it, while at the same time to prevent the poor from getting
> wealthy.

How do the wealthy prevent the poor from getting wealthy?!? Is there a
diabolical scheme that keeps the rich busy plotting how to keep everyone
else poor? That is so ridiculous! The biggest factor in determining
how well a person does in this country is still down to individual
choices, not anyone putting anyone else down.

>
> Does every wealthy person behave this way? No. But plenty do, and enough
> do that it's a serious problem. Only in a first grade schoolchild's fantasy
> is it true that everyone has equal opportunity, and any random poor person
> can become wealthy through simple hard work and perseverence.

I'm not saying that everyone grows up in the exact same environment and
has exactly the same opportunities. But apparently unlike you, I DO
believe that hard work, perseverance, making correct (sometimes
difficult) choices, and maybe a little bit of luck is what it takes for
ANYONE to make it in the United States.

I am not an ideological purist or a rabid Libertarian, so I also happen
to think that some of the social programs and things like the
progressive tax system and free public education (from which I
benefited) is important for giving everyone a relatively fair shake and
an honest attempt at an equal opportunity. We have those things, and
that is why I believe that those that have the drive, talent, and
ambition in this country can make it. No rich person will get in their
way. More likely than not, the rich people will be the ones that enable
the poor person's success, by paying for their talents with a nice
salary or buying the poor entrepreneur's products and services. Talk to
anyone that has started a business. As a general rule, they start out
pretty poor!

-Aviv

[Aviv Hod]

>
>
> ...by those who do not accept that "it's in their self interest to share
> some..." We can argue endlessly as to what is the appropriate share.
>
Yes, and it's an argument we have all the time in public discourse. The
line ebbs and flows one way or the other, but at any given time is at an
equilibrium responding to the prevailing economic conditions and
national mood. When people have a vote, they sway it one way or the
other, and that's the way it should be.


>>>Perhaps a return to those concepts WOULD be "a huge step forward".
>>>
>>>The pure "market" is not so perfect, either, producting its own set of
>>>problems. It continues to concentrate wealth, and spread the gap
>
> between
>
>>>rich and poor.... If that continues, (and right now there is no
>
> indication
>
>>>that it will not), the ultimate result will be civil revolution... just
>
> a
>
>>>matter of whether it is reached in fifteen years, or a hundred and
>
> fifteen.
>
>>I am flabbergasted every time that I hear the argument that "the market
>>system concentrates wealth", implying that there is a zero sum game
>>called "the market" where some people are the winners and everyone else
>>loses. The market system is the only system where all the participants,
>>under normal circumstances, benefit from their engagement in commerce
>>more than before their engagement. The exchange itself CREATES value,
>>and we go beyond that zero sum.
>
>
> It is not the exchange that creates value. It is the work, the labour.
> Free Enterprise encourages one to work, and I work to do something that you
> need and in return you work to do something that I need, and we are both
> better off and have something which we did not have before. The value of
> your work was directly proportional to the "increased wealth" that it
> created.

I still maintain that it's the exchange that creates the value - since
each person's labor is not worth as much before the exchange. If I
value my labor at $10 and you value my labor at $15 and we agree on a
price of $12, then you gained $3 after the exchange and got a good deal
exactly as I gained $2 above my break even point. We both won!

> As long as Free Enterprise followed somewhat along that model, things worked
> fine. It was very difficult for me to hide the value of my work from you,
> or you to do so from me.

Hide the value of your work from me?!? The value of my work is worth to
you exactly what you are willing to pay - it has nothing to do with how
much it costs me. A case in point is a baseball card. It's essentially
worthless, but people are willing to pay for them much more than what
they cost to produce. This is a very important point, and fundamental to
the capitalist system. The BUYERS set the price.

> But along came big corporations and we shifted from placing a value on your
> labour in terms of the incremental benefit it provides, and instead we
> valuate it like any commodity.... if it is plentiful, we buy it low, use it,
> sell its benefits high, and when we are done, we discard it.. It is no
> longer "people", it is commodity. We have written it out of the equation as
> far as being a "partner" in the creation of this wealth.

Do you consider YOUR labor to be a commodity? Are you like everyone
else? Are you not more proficient in some skills than others at the
same skills? This is communist thinking - everything is the same!

In point of fact, every person is unique and has a unique set of skills,
traits, and abilities. Corporations and small businesses go out of
their way and pay big bucks to find those that have particular skills or
sets of skills and attract and retain those people. Sir, you are wrong,
people are NOT commodities, and businesses don't act as if they were.
If a person feels underpaid in their current situation, in a free market
system they have more options than in any other system, including
furthering their education to get a better job, finding a job that
capitalizes on other strengths they may possess, or striking out on
their own by starting their own business.

That last one is one of the reasons that Americans are paid as much as
they are - there is a certain amount of money that American businesses
must pay their workers to keep them from leaving for greener pastures.
The easier it is to start a new business, the more pressure on current
businesses to pay higher salaries. This is important to keep in mind in
light of the fact that starting a business becomes a much more difficult
choice if government regulation strangles new business creation.

This has more info on this point:
http://forum.belmont.edu/cornwall/archives/2004/09/more_evidence_o_3.html

> Instead, we place a "value" of your "company" and its "potential". This
> "Value" that the Exchange creates can be very false, as in, say, Enron. Or
> Nortel, Yahoo, about any other tech company pre-early-2000. I would say THAT
> little piece of market history certainly WAS a zero-sum game with winners
> and losers, even a negative-sum game.
>

Who placed a "Value" on the "Potential?" The BUYERS of the stock!
Speculation is something that humans do. All of those people KNEW that
there is no guarantee of return. They knew that they could lose some or
all of their money playing that game. But if we wouldn't have people
willing to invest and risk capital, where would we be? If you look at
the big picture, not little snippets of time, you will see that overall
we have seen AMAZING growth and AMAZING improvements in standards of
living over the course of the last 100 years, bringing unprecedented
prosperity to Americans and more and more of the world. No sir, this is
no zero sum game!

>>Does the market create the opportunity
>>for some individuals to become extremely wealthy? Sure - but it's NOT
>>because of skin off of anyone else's back. So we have a bunch of people
>>that benefited from their engagement in the market now more wealthy than
>>before, and some that also benefited from their engagement in the market
>>to a greater extent, sometimes becoming very wealthy. What is
>>inherently wrong with that?
>
>
> Maybe nothing. Unless, as pointed out above, the share of the total benefit
> that resulted from that market "engagement" was inappropriately divided
> amongst the players. Maybe the "very wealthy" would only have become
> "moderately wealthy", had the benefits been divided equitably. We can argue
> endlessly about what constitutes an equitable division.
>

Who decides what is appropriate and inappropriate? Should people that
never invested have gotten to ride other people's coattails? If you
don't throw your hat in the ring, you don't get to play. The
interesting twist to all of this is that indeed many people DID get to
ride investor's and entrepreneur's coattails, in that the progressive
tax system transfers money from the affluent to the poor. We had a
surge of tax money that financed all sorts of social programs, defense,
education, as well as balancing the budget and paying down our national
debt. This at a time when the bottom 20% of earners in the U.S. paid
exactly ZERO income taxes. They got to ride coattails, no? Is that
equitable?

Now, before you jump all over me, let me state that I actually think the
progressive tax system is overall a good thing. But it just galls me
when people conveniently forget who's paying who's way, and still
complain about "inequities".

>>There might be a large gap, but the fact
>>remains that those at the bottom are still better off than before. In a
>>well regulated market (which bars monopoly and dishonesty), the overall
>>effect is that everyone is better off.
>>
>
>
> "Which bars monopoly and dishonesty...." Isn't it interesting that the "free
> market" has been unable to do this, with quite spectacular results for some
> of those investors (and workers) who were hoping to benefit from its
> "opportunity"...
>

The market system punishes dishonesty better than ANY other system.
Just take a look at the dishonesty and corruption that socialist planned
economies brought about. Who got in trouble for Chernobyl? Who got in
trouble when there was bread only on Tuesdays and Fridays from 3PM to
5PM? Take a look closer to home - the dishonesty and corruption that
happens with any number of government programs, including, on the grand
scale, mismanagement of the treasury by getting us into HUGE deficits.
Who is punished? Who is held accountable? The market at least punished
the Enrons of the world. They are no longer around. The regulators
that were supposed to watch the industry are finally getting back on the
right path, and that is appropriate. But the punishment has already
been swift and severe, courtesy of the market, which makes it less
likely it will happen again.

>
>>The best feature of the market economy and freedom is that rich and poor
>>do not remain in either of those classes for very long. There is
>>economic mobility that sees people creating value and becoming richer
>>and rich people that become complacent and become poorer.
>
>
> Very true in the original Free Enterprise model where my labour and your
> labour were valued by their contribution to the increase in wealth. Less
> so, today, because they are not, they are valued as a commodity. Very
> difficult to live my life over.... if I chose a skill that looked good 10
> years ago, and puts me on amongst the pink slips today, very difficult to
> have "economic mobility"...
>

Back to the commodity argument... Once again, no one is a commodity!
Even if you chose ten years ago to specialize in a particular skillset,
you would have plenty of skills besides the one that is no longer as
highly valued. Use what you have to do as well as you can. No one will
pay for people to sit on their bum (except maybe the government, but
only for a period of time).

I understand that it's difficult for people to change tacks mid-career.
But that's just life - we must adapt to prevailing conditions. There
is a reality out there that precludes lifetime employment for most
people. If the fortune 500 of 100 years ago only has one original
member still in it today (GE), then what makes one think that they
personally will not need to also adapt and change? It's tough, but it's
the only realistic outlook to have. Luckily most people in the
workforce have more than one skill, and can eventually find something
else to do that is productive enough to make a living. The buggy whip
makers did not all starve to death when the automobile became commonplace!


>>This is why a
>>revolution is NOT inevitable, as you suggest. Why have a revolution
>>that makes us all equal, but equally miserable, when I could work a
>>while, start a business, and bring myself and my family to riches?
>>
>
>
> A revolution is not inevitable because, first of all, the government is a
> lot more Socialist that it cares to admit. Minutes ago there was an
> announcement that Mel Brooks will shoot a film version of "The Producers" in
> New York, because of new Tax breaks for the film industry.
>
> It is also not inevitable because, once in a long while, some sanity does
> prevail amongst the electorate and the elected.
>

Here we agree. I mentioned earlier that there is a constant tug of war
in terms of how much socialism we should have, and that I am not opposed
to some of it. But I do like to stand up and reiterate that we should
be careful how far we go with it, because having been born in a rather
socialist state and having lived in Europe, I know that it can really go
too far. There has to be a balance, and I advocate a balance that does
not kill the business and commerce side, which makes everything else
possible.

>>>Unless, of course, the "government" clamps down on the revolutionaries
>
> with
>
>>>military might, in which case we have something akin to feudalism or
>>>dictatorship, as in any number of countries you could point at recently,
>
> or
>
>>>even today.
>>
>>Whoa, hold on there. There is no need for revolution. This is a
>>democratic country - those "revolutionaries" could simply run for
>>office. Luckily their ideas are so far removed from the values of most
>>Americans that they won't stand a chance in hell getting elected.
>
>
> "could simply run for office..." Well, yes, they could, provided they had
> the money to do so.
>
> Democracy used to pretend to work that way, but a few things have changed.
> For one, a long time ago, the mainstream media use to educate the public
> about the policy proposals, and would provide a myriad of editorial
> opionions about the perceived consequences. The media today has merged into
> just a few (loud and obnoxious) voices that has largely abandoned rational
> thought in favor of partisan political spin. They have totally abrogated
> their watch-dog responsibilities in favor of scooping the sensational,
> sound-biting the important, and dwelling on the incidental.... It has become
> more important to sell a lot of Viagra or whatever, than to inform the
> public.
>
> It is pretty hilarious that the most rational political debates probably
> occur on the late-night-comedy talk shows.
>

Nothing has changed. The people running the presses have always been
quite powerful. The good thing is that today, the cost to own your own
press is a small barrier to entry. Grassroots organizations have
mobilized millions of people for and against the current administration,
and the charges of mainstream media bias are way overblown. And in any
case, for CNN's alleged liberal bias there is Fox's alleged conservative
bias. There is no such thing as completely unbiased journalism, but if
you look at the big picture, media outlets generally shy away from going
too far one way or the other lest they alienate too many people.

Having said that, I must profess my love for the Daily Show :-)

>
>>We know what has made this country great, and it's not government control
>>of the economy!
>
>
> Yes, I notice that. See the discussion of Governor Pataki and tax breaks,
> above, or search google about farm and lumber subsidies, for a start.
>

I happen to be against most subsidies. They distort the market and
trade. They are generally inappropriate.

>
>>
>>>The founding Fathers wrote in some stuff to prevent that. I hope it is
>>>still holding up???
>>
>>Yes, the founding fathers wrote in some pretty neat stuff about
>>governing this nation, protecting freedom of speech, while at the same
>>time protecting EVERYONE's life and liberty. That excludes
>>"revolutionaries" that wish to impose their will on others by means
>>other than democratic election. The government does not have the
>>authority to "clamp down on revolutionaries with military might" under
>>our constitution unless they are breaking the law.
>
>
> ... mmm ... I'd like to think that. But they DO have the right to "clamp
> down" and invade the privacy of people who are NOT breaking the law, but are
> under suspicion that they MIGHT do so one day in the unspecified future???
>

I don't agree with this either. I alluded to this in my next line.
Security vs. Liberty is as tough of a debate as the debate about how
much progressivity there should be in the tax system, except with higher
stakes. I tend to side with the Liberty side, but understand some
security concessions. This doesn't include what you just remarked about.

>
>>So the Communist
>>Party USA can operates as freely as it wants, so long as they are not
>>breaking any laws. Laws that are checked by our judicial branch and
>>that must be constitutional. Although it is constantly under
>>bombardment, the constitution is still holding up.
>>
>>How well would it hold up under socialism/communism? I assert that it
>>couldn't.
>>
>>
>
>
> Of, for sure not, under a socialist or communist dictatorship.... But be
> very careful that democracy-for-the-well-connected,
> Free-Enterprise-but-not-quite-for-everybody, or
> Freedom-if-you're-not-suspicious.... does not slowly slide into
> dictatorship, also.

Hey man, I'm on your side there. There is constant pressure to distort
and manipulate the interpretation of the constitution, and that is 100%
to be expected. My conclusion, having said that, is that we must be
ever vigilant as Americans about fighting for upholding our rights and
making this country as good as it can be. As long as no one side gets to
dominate, we'll have a nice, moderate set of policies that don't cause
revolutions.

-Aviv

[Icebound]

"Andrew Gideon" > wrote in message
online.com...
> Icebound wrote:
>
> > It is not the exchange that creates value. It is the work, the labour.
>
> In fact, it is both. If you have something that you value at 10 but I
value
> at 15, and I buy it from you for 12, then the net value has increased:
I've
> gained 3 and you've gained 2.
>

Well, yes and no. The "net value" has not really increased. It is just
that I did not recognize the true value because there is information that I
did not have. Part of what I said earlier about the ability to hide the
worth of work. One reason the rich-poor gap grows is because one of those
segments has the better ability to understand and "hide" the value of work.

Now if you had bought it for 12, added some work to improve it, then sold it
for 15, that's a different story.


> This doesn't only apply to things; services are subject to the same
effect.
>
> This is also why investment works. I give you 10 to use for a while. You
> use it to make 5 more, and pay me back 12.
>

Investment is a way of paying for the privilege of not doing labour and
that's okay, assuming that the original money was honestly earned in the
first place. You give me 10 and I put in some labour that adds value to
your 10 so that I can sell it for 15. I could not have achieved the result
without your 10, so I am happy to share the extra 5 with you. I give you
your original 10 plus 2 and only keep 3. In effect, you have received 2 for
MY work, but that's okay, I couldn't have done it without you.


> Sure, work plays a role too. But if we assume that you bought labor
> (another word for "service") with that 10 I loaned to you, then absent the
> loan of 10 that service could never have been purchased.

Not exactly true. The provider of the "service" could "trust" me to
eventually compensate for his provision. Rather than you loaning me 10, he
can loan me the equivalent work. When I eventually "sold" the final
product, I would be able to give HIM the 12 and keep 3. You are simply a
convenient middle man, so that he does not have to do that. Without you, he
would have been happy with 1.5, but you have overhead keeping track of all
those you loan to, and you ARE providing some additional convenience, so you
need something more.

[Icebound]

"Aviv Hod" > wrote in message
...
>
> >
> >
> > ...by those who do not accept that "it's in their self interest to share
> > some..." We can argue endlessly as to what is the appropriate share.
> >
> Yes, and it's an argument we have all the time in public discourse. The
> line ebbs and flows one way or the other, but at any given time is at an
> equilibrium responding to the prevailing economic conditions and
> national mood. When people have a vote, they sway it one way or the
> other, and that's the way it should be.
>
>
> >>>Perhaps a return to those concepts WOULD be "a huge step forward".
> >>>
> >>>The pure "market" is not so perfect, either, producting its own set of
> >>>problems. It continues to concentrate wealth, and spread the gap
> >
> > between
> >
> >>>rich and poor.... If that continues, (and right now there is no
> >
> > indication
> >
> >>>that it will not), the ultimate result will be civil revolution... just
> >
> > a
> >
> >>>matter of whether it is reached in fifteen years, or a hundred and
> >
> > fifteen.
> >
> >>I am flabbergasted every time that I hear the argument that "the market
> >>system concentrates wealth", implying that there is a zero sum game
> >>called "the market" where some people are the winners and everyone else
> >>loses. The market system is the only system where all the participants,
> >>under normal circumstances, benefit from their engagement in commerce
> >>more than before their engagement. The exchange itself CREATES value,
> >>and we go beyond that zero sum.
> >
> >
> > It is not the exchange that creates value. It is the work, the labour.
> > Free Enterprise encourages one to work, and I work to do something that
you
> > need and in return you work to do something that I need, and we are both
> > better off and have something which we did not have before. The value
of
> > your work was directly proportional to the "increased wealth" that it
> > created.
>
> I still maintain that it's the exchange that creates the value - since
> each person's labor is not worth as much before the exchange. If I
> value my labor at $10 and you value my labor at $15 and we agree on a
> price of $12, then you gained $3 after the exchange and got a good deal
> exactly as I gained $2 above my break even point. We both won!
>

I am afraid I have to disagree. If we value the same labour differently,
one of us does not have all the relevant information, and so the one with
the incorrect information "loses". Eventually, that labour will produce
something which I will market for N. If N is more than 12, You lose, I win.
If N is less than 12, I lose, you win.


> > As long as Free Enterprise followed somewhat along that model, things
worked
> > fine. It was very difficult for me to hide the value of my work from
you,
> > or you to do so from me.
>
> Hide the value of your work from me?!? The value of my work is worth to
> you exactly what you are willing to pay - it has nothing to do with how
> much it costs me. A case in point is a baseball card. It's essentially
> worthless, but people are willing to pay for them much more than what
> they cost to produce. This is a very important point, and fundamental to
> the capitalist system. The BUYERS set the price.
>

A price, set by the BUYERS in this way, has nothing to do with "value". A
price of a baseball card is simply "inflation-deflation". In the meaningful
economy we introduce measures to curb these.


> > But along came big corporations and we shifted from placing a value on
your
> > labour in terms of the incremental benefit it provides, and instead we
> > valuate it like any commodity.... if it is plentiful, we buy it low, use
it,
> > sell its benefits high, and when we are done, we discard it.. It is no
> > longer "people", it is commodity. We have written it out of the equation
as
> > far as being a "partner" in the creation of this wealth.
>
> Do you consider YOUR labor to be a commodity? Are you like everyone
> else? Are you not more proficient in some skills than others at the
> same skills? This is communist thinking - everything is the same!
>
> In point of fact, every person is unique and has a unique set of skills,
> traits, and abilities. Corporations and small businesses go out of
> their way and pay big bucks to find those that have particular skills or
> sets of skills and attract and retain those people. Sir, you are wrong,
> people are NOT commodities, and businesses don't act as if they were.

....mmm.... 300-thousand jobs per year leaving the high-paid US to low-paid
third world countries suggests to me the labour IS being treated as a
commodity.

> If a person feels underpaid in their current situation, in a free market
> system they have more options than in any other system, including
> furthering their education to get a better job, finding a job that
> capitalizes on other strengths they may possess, or striking out on
> their own by starting their own business.
>
> That last one is one of the reasons that Americans are paid as much as
> they are - there is a certain amount of money that American businesses
> must pay their workers to keep them from leaving for greener pastures.
> The easier it is to start a new business, the more pressure on current
> businesses to pay higher salaries. This is important to keep in mind in
> light of the fact that starting a business becomes a much more difficult
> choice if government regulation strangles new business creation.
>
> This has more info on this point:
> http://forum.belmont.edu/cornwall/archives/2004/09/more_evidence_o_3.html
>

One of the reasons for the increased regulation is because history shows
that in our rush to have a "bouyant economy", we chose some short-cuts with
respect to the health of the population and the environment, and we left
some toxic garbage around whose cleanup was never really figured into the
cost of doing business.

Admitedly, that is not to say that all regulation is good and productive,
but it should not be dismissed out of hand.


> > Instead, we place a "value" of your "company" and its "potential". This
> > "Value" that the Exchange creates can be very false, as in, say, Enron.
Or
> > Nortel, Yahoo, about any other tech company pre-early-2000. I would say
THAT
> > little piece of market history certainly WAS a zero-sum game with
winners
> > and losers, even a negative-sum game.
> >
>
> Who placed a "Value" on the "Potential?" The BUYERS of the stock!
> Speculation is something that humans do. All of those people KNEW that
> there is no guarantee of return. They knew that they could lose some or
> all of their money playing that game. But if we wouldn't have people
> willing to invest and risk capital, where would we be? If you look at
> the big picture, not little snippets of time, you will see that overall
> we have seen AMAZING growth and AMAZING improvements in standards of
> living over the course of the last 100 years, bringing unprecedented
> prosperity to Americans and more and more of the world. No sir, this is
> no zero sum game!

AMAZING growth and improvements in the overall economy do not come from the
growth in the price of stock. They came from the addition of real value
through the creation of goods and provision of services. In other words,
because of somebody's work.

>
> >>Does the market create the opportunity
> >>for some individuals to become extremely wealthy? Sure - but it's NOT
> >>because of skin off of anyone else's back. So we have a bunch of people
> >>that benefited from their engagement in the market now more wealthy than
> >>before, and some that also benefited from their engagement in the market
> >>to a greater extent, sometimes becoming very wealthy. What is
> >>inherently wrong with that?
> >
> >
> > Maybe nothing. Unless, as pointed out above, the share of the total
benefit
> > that resulted from that market "engagement" was inappropriately divided
> > amongst the players. Maybe the "very wealthy" would only have become
> > "moderately wealthy", had the benefits been divided equitably. We can
argue
> > endlessly about what constitutes an equitable division.
> >
>
> Who decides what is appropriate and inappropriate? Should people that
> never invested have gotten to ride other people's coattails? If you
> don't throw your hat in the ring, you don't get to play. The
> interesting twist to all of this is that indeed many people DID get to
> ride investor's and entrepreneur's coattails, in that the progressive
> tax system transfers money from the affluent to the poor. We had a
> surge of tax money that financed all sorts of social programs, defense,
> education, as well as balancing the budget and paying down our national
> debt. This at a time when the bottom 20% of earners in the U.S. paid
> exactly ZERO income taxes. They got to ride coattails, no? Is that
> equitable?
>
> Now, before you jump all over me, let me state that I actually think the
> progressive tax system is overall a good thing. But it just galls me
> when people conveniently forget who's paying who's way, and still
> complain about "inequities".

....in the same way that it galls me when people constantly deride
"socialism" as some sort of sinister evil, when their very own economic
system depends on it to help adjust some of the imperfections of the "free
market" system.

The bottom 20% of earners may well have deserved to ride the coattails, if
their labor was undervalued in the overall scheme of things, or if they lost
out on other fiscal opportunities because they did not have access to the
same information that the rest had. Or not, but there too we can argue
forever.

>
> >>There might be a large gap, but the fact
> >>remains that those at the bottom are still better off than before. In a
> >>well regulated market (which bars monopoly and dishonesty), the overall
> >>effect is that everyone is better off.
> >>
> >
> >
> > "Which bars monopoly and dishonesty...." Isn't it interesting that the
"free
> > market" has been unable to do this, with quite spectacular results for
some
> > of those investors (and workers) who were hoping to benefit from its
> > "opportunity"...
> >
>
> The market system punishes dishonesty better than ANY other system.
> Just take a look at the dishonesty and corruption that socialist planned
> economies brought about. Who got in trouble for Chernobyl? Who got in
> trouble when there was bread only on Tuesdays and Fridays from 3PM to
> 5PM?

I am certainly not advocating dictatorial socialism which did produce the
features which you cite. By the same token, I do not particularly fear
inserting a few useful "socialist" policies into a "free-market" democracy.

> Take a look closer to home - the dishonesty and corruption that
> happens with any number of government programs, including, on the grand
> scale, mismanagement of the treasury by getting us into HUGE deficits.
> Who is punished? Who is held accountable? The market at least punished
> the Enrons of the world. They are no longer around. The regulators
> that were supposed to watch the industry are finally getting back on the
> right path, and that is appropriate. But the punishment has already
> been swift and severe, courtesy of the market, which makes it less
> likely it will happen again.
>

The market has "punished" thousands of innocent investors and workers. The
truly guilty are working their way through the courts independantly of the
"market".

> >
> >>The best feature of the market economy and freedom is that rich and poor
> >>do not remain in either of those classes for very long. There is
> >>economic mobility that sees people creating value and becoming richer
> >>and rich people that become complacent and become poorer.
> >
> >
> > Very true in the original Free Enterprise model where my labour and your
> > labour were valued by their contribution to the increase in wealth.
Less
> > so, today, because they are not, they are valued as a commodity. Very
> > difficult to live my life over.... if I chose a skill that looked good
10
> > years ago, and puts me on amongst the pink slips today, very difficult
to
> > have "economic mobility"...
> >
>
> Back to the commodity argument... Once again, no one is a commodity!
> Even if you chose ten years ago to specialize in a particular skillset,
> you would have plenty of skills besides the one that is no longer as
> highly valued. Use what you have to do as well as you can. No one will
> pay for people to sit on their bum (except maybe the government, but
> only for a period of time).
>
> I understand that it's difficult for people to change tacks mid-career.
> But that's just life - we must adapt to prevailing conditions. There
> is a reality out there that precludes lifetime employment for most
> people. If the fortune 500 of 100 years ago only has one original
> member still in it today (GE), then what makes one think that they
> personally will not need to also adapt and change? It's tough, but it's
> the only realistic outlook to have. Luckily most people in the
> workforce have more than one skill, and can eventually find something
> else to do that is productive enough to make a living. The buggy whip
> makers did not all starve to death when the automobile became commonplace!
>
>

See my comment on jobs leaving the USA, above.

> >>This is why a
> >>revolution is NOT inevitable, as you suggest. Why have a revolution
> >>that makes us all equal, but equally miserable, when I could work a
> >>while, start a business, and bring myself and my family to riches?
> >>
> >
> >
> > A revolution is not inevitable because, first of all, the government is
a
> > lot more Socialist that it cares to admit. Minutes ago there was an
> > announcement that Mel Brooks will shoot a film version of "The
Producers" in
> > New York, because of new Tax breaks for the film industry.
> >
> > It is also not inevitable because, once in a long while, some sanity
does
> > prevail amongst the electorate and the elected.
> >
>
> Here we agree. I mentioned earlier that there is a constant tug of war
> in terms of how much socialism we should have, and that I am not opposed
> to some of it. But I do like to stand up and reiterate that we should
> be careful how far we go with it, because having been born in a rather
> socialist state and having lived in Europe, I know that it can really go
> too far. There has to be a balance, and I advocate a balance that does
> not kill the business and commerce side, which makes everything else
> possible.
>


We agree on a lot more that might seem at first glance.

1. I favor and am part of the "free-market" economy.
2. I advocate the insertion of "socialist" policies because the
"free-market" economy is far from perfect and requires a reasonable
regulation.
3. I dislike the implication that socialist policies are inherently evil,
and that countries which advocate them are somehow not to be trusted.
Socialist dictatorships are one thing. But "free-market" economies would be
out of control without some "socialist" regulation.

.... and in the interest of shortening this totally out-of-control
discussion, I have snipped the rest because we seem to have reached some
semblance of understanding...

[Teacherjh]

>>
If we value the same labour differently,
one of us does not have all the relevant information
<<

Ice is more valuable to somebody with no freezer. My labor is more valuable to
somebody who can't do what I just did. My knowledge is more valuable to
somebody who is partly ignorant (and of no value to somebody who is wholely
ignorant or totally educated).

Sometimes the value of a thing (concrete or not) is based on circumstances, and
it doesn't take labor to change the circumstances. A diplomat can change the
value of an atomic bomb by talking. An atomic bomb can change the value of
milk if the diplomat doesn't talk well.

What is the value of water in a bottle? Why is one person willing to pay $5
and the person next to her unwilling to even carry it to the car if it's free?

Jose

--
(for Email, make the obvious changes in my address)

[Dylan Smith]

In article >, Icebound wrote:
> ...mmm.... 300-thousand jobs per year leaving the high-paid US to low-paid
> third world countries suggests to me the labour IS being treated as a
> commodity.

And many of the outsourcers are discovering the labour wasn't quite the
commodity they thought it was.

Sadly, there are too many Dilbert-style PHBs in management.

As a defensive measure, I've shifted from a pure software development
job to one that requires at least some on-site presence (someone has to
install hardware and pull cables) instead of waiting like a lamb to the
slaughter as the PHBs jump on the outsourcing bandwagon.

--
Dylan Smith, Castletown, Isle of Man
Flying: http://www.dylansmith.net
Frontier Elite Universe: http://www.alioth.net
"Maintain thine airspeed, lest the ground come up and smite thee"

[Icebound]

"Teacherjh" > wrote in message
...
> >>
> If we value the same labour differently,
> one of us does not have all the relevant information
> <<
>
> Ice is more valuable to somebody with no freezer.

No, the person with the freezer may not have a need to buy ice, but if he
DOES buy it, he should be buying it for exactly the same value of money or
labour which the person without a freezer would pay. That is because the
maker/vendor of the ice spent a certain amount on materials, overhead, and
expects a certain amount of profit, and it should be the same no matter who
the buyer. Otherwise it becomes an aberration of the free-market which we
call price-gouging.

> My labor is more valuable to
> somebody who can't do what I just did.

.... true, but in return, his labor is valuable to you because he can do what
you cannot. That provides both of you with an incentive to work and add
value to the economy.

>My knowledge is more valuable to
> somebody who is partly ignorant ...(and of no value to somebody who is
wholely
> ignorant or totally educated).

Your knowledge means something only when it is combined with labour to
create additional value in the economy. If you use the advantage of your
superior knowledge to undervalue someone elses labour, or distort facts
about contents and performance of a product, that is an aberration of the
free-market system which allows the wealthy to accumulate at the expense of
others, and even free market economies have to curtail that. I think one
example is called "insider trading".

>
> Sometimes the value of a thing (concrete or not) is based on
circumstances, and
> it doesn't take labor to change the circumstances.

No, I don't believe that. Circumstances cause inflation or deflation, but
they do not change the base value. Inflation and deflation are considered
disruptive charateristics of an economy, which Mr. Greenspan and the
Government try to control. Disruptive circumstances such as hurricanes or
desparation within segments of the poplulace cause short term price gouging
and the like. I would not consider this as a healthy aspect of a
free-market economy and we put mechanisms in place to control them. Does
that make these socialistic mechanisms bad policies?

> A diplomat can change the
> value of an atomic bomb by talking. An atomic bomb can change the value
of
> milk if the diplomat doesn't talk well.

We are not talking politics here, we are talking economy.

A bomb is a negative on the economy, because if it is not used, it has
wasted labor, and if it IS used, it will destroy the fruits of other labor.
If it is used to destroy other bombs, that only means that somebody else's
labour was also wasted in the creation of THOSE bombs, and on and on in a
vicious circle. Building and using bombs is a presumption that we WILL have
losses, and all we are doing is cutting the losses, rather than attempting
to improve our growth.

>
> What is the value of water in a bottle? Why is one person willing to pay
$5
> and the person next to her unwilling to even carry it to the car if it's
free?
>

Because one of those people does not have all the information. Thus one of
these people is a "loser" in the economy. This has been argued several posts
back.

A free-and-open-market economy is not meant to have "losers". I do a little
work for you, you do a little work for me, we both gain. ...and so on and so
on.... If I choose to do little, I gain less than the guy who does more.
But this concept has morphed into something considerably different, where it
has become much easier to "win" (and lose), and where there are blatant
attempts to hide information so that a losers are created such that the rest
of us can win. Governemnts try to control this, (and to compensate for the
Market's errors) with a few socialistic policies.

This does not make them evil agents of the communist devil.

Our OT time is up, we now return you to your regular programming.

[Teacherjh]

>>
No, the person with the freezer may not have a need to buy ice, but if he
DOES buy it, he should be buying it for exactly the same value of money or
labour which the person without a freezer would pay. That is because the
maker/vendor of the ice spent a certain amount on materials, overhead, and
expects a certain amount of profit, and it should be the same no matter who
the buyer. Otherwise it becomes an aberration of the free-market which we
call price-gouging.
<<

There is no reason that he =should= be buying it for exactly the same price.
Who is going to dictate that price? (especially if you reject the idea that
the individuals who =make=up= the market shouldn't.

>>
> My labor is more valuable to
> somebody who can't do what I just did.

.... true, but in return, his labor is valuable to you because he can do what
you cannot. That provides both of you with an incentive to work and add
value to the economy.
<<

While this (incentive thing) may be true, it is irrelevant to my point, which
is that my labor (or anything) does not have a fixed value, but a value that is
dependent on to whom, when, and how it is presented. Just like ice to eskimos.

>>
Your knowledge means something only when it is combined with labour to
create additional value in the economy.
<<

My knowledge (such as of a better process) can allow me to =avoid= labor. It
can allow me to get along =without= buying something. It can keep me healthy
in the face of McDonalds. It can keep my airplane (obligatory reference) out
of the repair shop, and it can do so =without= labor. Giving this knowlege to
others (free or at a price) to allow them to reap the same benefits is of
value, but only to those who don't have that knowlege already, and know that it
would be helpful to them.

>> Disruptive circumstances such as hurricanes...

Hurricaines and such are not disruptive; we only see them that way because we
look short term. An engine overhaul is not an "extraordinary disruptive
expense" either. It is an expected part of flying, and one the intellegent
airplane owner counts on having (see my knowledge point above). It's
disruptive only if you do not have a reserve built in. "The market" does not
build in a reserve for hurricaines, though the insurance industry makes a
start.

>> [re. A-bombs and milk] We are not talking politics here, we are talking
economy.

They are interrelated. I have a piece of land I'd like to develop. It's zoned
for four acre housing, and is vacant. I can sell it for no more than $10,000
an acre. I make nice to the town council, they vote to rezone the land for
"mixed use", which includes businesses and quarter acre housing. Now I can
sell this land for ten times as much. It's the same land.

>>
> What is the value of water in a bottle? Why is one person willing to pay $5
> and the person next to her unwilling to even carry it to the car if it's
free?
>

Because one of those people does not have all the information. Thus one of
these people is a "loser" in the economy.
<<

Nope. One person is not thirsty and has good tap water at home. The other has
tap water that tastes of salt and chlorine. It has nothing to do with
information, and everything to do with circumstances. Nobody is a loser.

So how much is the water "worth"? The real answer is "to whom?". The concept
of "the market" is a convenient abbreviation for very complex forces, and is
very useful. However, when examined too closely, it fails.

This is ok... it's just a convenient moniker. But don't mistake it for a real
force in its own right.

Jose


--
(for Email, make the obvious changes in my address)

[Andrew Gideon]

Teacherjh wrote:

> There is no reason that he =should= be buying it for exactly the same
> price.

The idea of a fixed price, as opposed to each transaction involving
negotiation, is a relatively recent innovation. How this innovation has
become a Law of the Universe, I cannot say.

But look at how angry people became when Amazon experimented with the old
fashioned approach.

Apparently, the "shopping for the lowest price" permitted by the Internet is
a Good Thing, while "shopping for the consumer willing to pay the highest
price" is a Bad Thing.

No, that's not quite right. This is accepted in auctions. Maybe only
stores aren't permitted to work in their own best interests.

- Andrew

[Teacherjh]

>>
But look at how angry people became when Amazon experimented with the old
fashioned approach. ["customized" pricing]
<<

Amazon did it the sneaky way, by (as some economists might put it) taking
advantage of the consumer's ignorance, and of their special knowledge of each
individual consumer (gained through logging their purchases, and perhaps even
spying on their web surfing and correlating it with other databases). This is
a Bad Thing, no matter who does it, be it the credit card companies, the
neighbor across the street, a high school student in Pakistan, or the TSA.

Amazon pulled a fast one.

Jose


--
(for Email, make the obvious changes in my address)

[Peter Duniho]

"Teacherjh" > wrote in message
...
> Amazon did it the sneaky way, by (as some economists might put it) taking
> advantage of the consumer's ignorance, and of their special knowledge of
> each
> individual consumer (gained through logging their purchases, and perhaps
> even
> spying on their web surfing and correlating it with other databases).

"Perhaps even"? Come on...at least stick to known facts.

As for their actual documented techniques, while I understand many people
found the concept offensive, I fail to see how what Amazon was doing is any
different from "the old fashioned approach" to which Andrew refers. It used
to be, you shopped with someone that got to know you very well. Negotiating
the price depended almost entirely on that person's knowledge of you and
your buying habits, and everyone got a different price.

Not everyone thinks that sort of commerce is a good thing, but the beauty of
our system is that no one is forcing you to buy stuff from Amazon. Don't
like them, either because of their prices or their marketing, just go
somewhere else.

If it's truly a "Bad Thing", they won't be able to afford continuing the
practice.

Pete

[Peter]

Teacherjh wrote:
> But look at how angry people became when Amazon experimented with the old
> fashioned approach. ["customized" pricing]
> <<
>
> Amazon did it the sneaky way, by (as some economists might put it) taking
> advantage of the consumer's ignorance, and of their special knowledge of each
> individual consumer (gained through logging their purchases, and perhaps even
> spying on their web surfing and correlating it with other databases). This is
> a Bad Thing, no matter who does it, be it the credit card companies, the
> neighbor across the street, a high school student in Pakistan, or the TSA.

Well if you're talking about customized pricing then the credit card
companies charge different interest rates depending on whether you
got their 'teaser' rate, your credit score, how long you've been with
them, etc.; the neighbor across the street (in other words a case where
you know the seller) probably will sell his used items to you at a
different price depending on whether you're a relative, close friend,
casual acquaintance, etc.; the student in Pakistan is likely to
negotiate the price of anything; and I wouldn't trust the TSA enough
to buy from them no matter what the price.

[Teacherjh]

>>
Peter said: (quoting (Jose))

> Amazon did it the sneaky way, by (as some economists might put it) taking
> advantage of the consumer's ignorance, and of their special knowledge of each
> individual consumer (gained through logging their purchases, and perhaps even
> spying on their web surfing and correlating it with other databases). This
is
> a Bad Thing, no matter who does it, be it the credit card companies, the
> neighbor across the street, a high school student in Pakistan, or the TSA.

Well if you're talking about customized pricing then the credit card
companies charge different interest rates depending on whether you
got their 'teaser' rate, your credit score, how long you've been with
them, etc.; the neighbor across the street (in other words a case where
you know the seller) probably will sell his used items to you at a
different price depending on whether you're a relative, close friend,
casual acquaintance, etc.; the student in Pakistan is likely to
negotiate the price of anything; and I wouldn't trust the TSA enough
to buy from them no matter what the price.
<<

It's not the custom pricing that is the Bad Thing. It is the deception, the
misuse of the expectation of a fixed price and Amazon's one-way knowledge of
its customers, that is the Bad Thing. In your other examples, either there
isn't an expectation of a fixed price (credit card rates should depend on the
risk, as do insurance rates), or the transactions is on a more even footing
(you probably know or have the opportunity to know your neighbor as well as
they know you).

And the TSA is selling us a bill of goods whether we buy or not.

My point however is that the =value= of a thing differs from case to case, and
is not intrinsic. To the extent that things are fungible and demand is fairly
steady, a value (and therefore a price) tends to settle out, but an economic
theory that asserts that variations in price are just based on "lack of
information", and/or all trade is zero sum, is deeply flawed.

Jose







--
(for Email, make the obvious changes in my address)

[Teacherjh]

>>
I fail to see how what Amazon was doing is any
different from "the old fashioned approach" to which Andrew refers. It used
to be, you shopped with someone that got to know you very well. Negotiating
the price depended almost entirely on that person's knowledge of you and
your buying habits, and everyone got a different price.
<<

The customized price isn't the Bad Thing. The deception and misuse of a very
one-sided information exchange (Amazon knows everything useful about you, you
know nothing useful about the decisionmakers at Amazon) that is the Bad Thing,
and it (one sided information exchange) will only lead to more Bad Things.

Jose



--
(for Email, make the obvious changes in my address)

[jawilljr]

Price gouging saves lives... read below.

http://www.mises.org/fullstory.aspx?control=3D1593

In my opinion there is no such thing as 'price gouging' in a free =
market. I should be able to sell whatever I want for whatever the =
market can bear. Why do you think the price of oil is up? Plain and =
simple... supply and demand. If supply shrinks while demand stays the =
same, the price goes up. That is the free market.

Jerry

"Icebound" > wrote in message =
...
>=20
> "Teacherjh" > wrote in message
> ...
>> >>
>> If we value the same labour differently,
>> one of us does not have all the relevant information
>> <<
>>
>> Ice is more valuable to somebody with no freezer.
>=20
> No, the person with the freezer may not have a need to buy ice, but if =
he
> DOES buy it, he should be buying it for exactly the same value of =
money or
> labour which the person without a freezer would pay. That is because =
the
> maker/vendor of the ice spent a certain amount on materials, overhead, =
and
> expects a certain amount of profit, and it should be the same no =
matter who
> the buyer. Otherwise it becomes an aberration of the free-market =
which we
> call price-gouging.
>=20
>> My labor is more valuable to
>> somebody who can't do what I just did.
>=20
> ... true, but in return, his labor is valuable to you because he can =
do what
> you cannot. That provides both of you with an incentive to work and =
add
> value to the economy.
>=20
>>My knowledge is more valuable to
>> somebody who is partly ignorant ...(and of no value to somebody who =
is
> wholely
>> ignorant or totally educated).
>=20
> Your knowledge means something only when it is combined with labour to
> create additional value in the economy. If you use the advantage of =
your
> superior knowledge to undervalue someone elses labour, or distort =
facts
> about contents and performance of a product, that is an aberration of =
the
> free-market system which allows the wealthy to accumulate at the =
expense of
> others, and even free market economies have to curtail that. I think =
one
> example is called "insider trading".
>=20
>>
>> Sometimes the value of a thing (concrete or not) is based on
> circumstances, and
>> it doesn't take labor to change the circumstances.
>=20
> No, I don't believe that. Circumstances cause inflation or deflation, =
but
> they do not change the base value. Inflation and deflation are =
considered
> disruptive charateristics of an economy, which Mr. Greenspan and the
> Government try to control. Disruptive circumstances such as =
hurricanes or
> desparation within segments of the poplulace cause short term price =
gouging
> and the like. I would not consider this as a healthy aspect of a
> free-market economy and we put mechanisms in place to control them. =
Does
> that make these socialistic mechanisms bad policies?
>=20
>> A diplomat can change the
>> value of an atomic bomb by talking. An atomic bomb can change the =
value
> of
>> milk if the diplomat doesn't talk well.
>=20
> We are not talking politics here, we are talking economy.
>=20
> A bomb is a negative on the economy, because if it is not used, it has
> wasted labor, and if it IS used, it will destroy the fruits of other =
labor.
> If it is used to destroy other bombs, that only means that somebody =
else's
> labour was also wasted in the creation of THOSE bombs, and on and on =
in a
> vicious circle. Building and using bombs is a presumption that we =
WILL have
> losses, and all we are doing is cutting the losses, rather than =
attempting
> to improve our growth.
>=20
>>
>> What is the value of water in a bottle? Why is one person willing to =
pay
> $5
>> and the person next to her unwilling to even carry it to the car if =
it's
> free?
>>
>=20
> Because one of those people does not have all the information. Thus =
one of
> these people is a "loser" in the economy. This has been argued several =
posts
> back.
>=20
> A free-and-open-market economy is not meant to have "losers". I do a =
little
> work for you, you do a little work for me, we both gain. ...and so on =
and so
> on.... If I choose to do little, I gain less than the guy who does =
more.
> But this concept has morphed into something considerably different, =
where it
> has become much easier to "win" (and lose), and where there are =
blatant
> attempts to hide information so that a losers are created such that =
the rest
> of us can win. Governemnts try to control this, (and to compensate =
for the
> Market's errors) with a few socialistic policies.
>=20
> This does not make them evil agents of the communist devil.
>=20
> Our OT time is up, we now return you to your regular programming.
>=20
>

[vincent p. norris]

What you folks are discussing is known to economists as "pricing
discrimination," and it is rampant in the American economy.

It would be an exaggeration to say that "everybody does it," but not
by much.

It would take me all night to list all the examples of pricing
discrimination I know about, and I'm sure I don't know about all of
them. Movie theatres charge more at night than in the afternoon, and
charge kids less than adults. Miami hotels charge less in summer than
in winter. Airline fares are notoriously discriminitory. The bus
line in this town lets old folks ride free--the ultimate in pricing
discrimination. Many if not most maker of brand-name products sell
the same product to chain drug stores and supermarkets at lower
prices, to be sold as generics or private labels.

Some pricing discrimination is requried by law. For example,
hospitals that receive federal funding are required to treat indigent
patients free of charge.

vince norris

[Peter Duniho]

"Teacherjh" > wrote in message
...
> The customized price isn't the Bad Thing. The deception and misuse of a
> very
> one-sided information exchange (Amazon knows everything useful about you,
> you
> know nothing useful about the decisionmakers at Amazon) that is the Bad
> Thing

I don't see how it's one-sided. Assuming there's no collusion with other
retailers going on (which would be illegal), the consumer can know
practically everything they actually need to know simply by comparing prices
between Amazon and other retailers.

Pete

[Teacherjh]

>>
> The customized price isn't the Bad Thing.
> The deception and misuse of a very
> one-sided information exchange (Amazon
> knows everything useful about you, you
> know nothing useful about the decisionmakers
> at Amazon) that is the Bad Thing

I don't see how it's one-sided. Assuming there's no collusion with other
retailers going on (which would be illegal), the consumer can know
practically everything they actually need to know simply by comparing prices
between Amazon and other retailers.
<<

It's one sided inasmuch as Amazon (or any modern retailer in this age of
networked computers) tracks and correlatess your interests via (say) your past
purchases, your zip code, your bank, whether you own or rent, your traffic
ticket history, in short any publicly available information they can get their
hands on and correlate or infer. This gets compared by machine with an entire
nation of other purchasers; in far more detail than your local greengrocer
could. Then they are the ones that make the initial offer, take it or leave
it. The retailer doesn't "need to know" my political affiliation, what brand
of car I drive, or how many condoms I purchase, but it sure helps them infer
how much I might be willing to pay for something they are selling.

I might get to know my local greengrocer as a person just as well as they get
to know me. But I will never get to know the executives (who make the initial
and often final offer) at the national retailers to this degree of detail, nor
do I have reasonable access to the other data which would allow me to correlate
the information, nor do I get to make an initial offer to Amazon (take it or
leave it), nor are there nearly as many alternative deal partners for me as
there is for a national retailer.

It is very one-sided.

It would take a natoinal boycott to influence the behavior of a national
retailer; a single shopper has next to no effect. However, a single retailer
can have a profound influence on the behavior of many individuals at once.

Jose


--
(for Email, make the obvious changes in my address)

[Bob Fry]

> > There is no reason that he =should= be buying it for exactly the same
> > price.
>
> The idea of a fixed price, as opposed to each transaction involving
> negotiation, is a relatively recent innovation. How this innovation has
> become a Law of the Universe, I cannot say.

Somewhere I read that it came about in the Puritan days. Or Pilgrim
days? What's the diff between them, anyway? The story is that the
leader of the group got tired of all the time wasted dickering about
prices on market day and persuaded the people to set fixed prices for
goods.

[Peter Duniho]

"Teacherjh" > wrote in message
...
>
> It's one sided inasmuch as Amazon (or any modern retailer in this age of
> networked computers) tracks and correlatess your interests via (say) your
> past
> purchases, your zip code, your bank, whether you own or rent, your traffic
> ticket history [...]

I guess if you can't stick to factual statements, there's not much point in
this discussion.

[Teacherjh]

>>
> It's one sided inasmuch as Amazon (or any modern retailer in this age of
> networked computers) tracks and correlatess your interests via (say) your
> past
> purchases, your zip code, your bank, whether you own or rent, your traffic
> ticket history [...]

I guess if you can't stick to factual statements, there's not much point in
this discussion.
<<

Ok, maybe not your traffic ticket history. And I don't work for a major
retailer. But the "privacy" agreements one gets in the mail or read on the web
are pretty explicit that they share their information with "... and
unaffiliated third parties as permitted by law." I have no doubt that they do
so.

Jose
--
(for Email, make the obvious changes in my address)

[Robert M. Gary]

AES/newspost > wrote in message >...
> In article >,
> "Mike Rapoport" > wrote:
>
> > Why should they pay a claim if they are not required to?
>
> Fair question -- but from a broader social point of view, if an
> expensive object (like an airplane) that has some small but significant
> change of causing massive damage to innocent third parties is going to
> be exist and be operated at all, maybe (or for sure, IMHO) it should be
> impossible for it to operate, or even exist, without at least liability
> coverage for damage to others.
>
> So maybe a legislative requirement on any company providing any kind of
> aviation related insurance should be that all their policies must always
> contain third-party liability coverage -- insurance on a plane should be
> required to include liability coverage for others no matter who operates
> it (even if it's stolen); insurance on a pilot should include liability
> coverage for others, no matter what plane he operates (or in what
> condition).

Seems a bit strange to require a certain type of insurance when no
insurance is required at all today.

>
> My impression is that in Europe auto insurance coverage goes with the
> car, not the driver. If so, good idea.

Same in the U.S. If you (one person) go out and buy 5 cars, you will
find that each car causes your rate to increase. The reason is because
the car creates liability indepenent of the driver.
>
> Our governor just vetoed drivers license for undocumented immigrants on
> grounds of inadequate insurance provisions: also a good idea,
> independent of views on whether undocumented immigrants should be given
> drivers licenses at all.

The illegal alien license was just a silly back door solution to avoid
addressing a real problem. If X number of immigrants are required to
run the state of California, then the feds need to come up with X
number of work permits. Making people live in a half-illegal status is
just stupid. If they're as needed as we're told, they need work
permits (i.e. be legal).

-Robert

[Cub Driver]

On 06 Oct 2004 06:01:55 -0700, Bob Fry
> wrote:

>Somewhere I read that it came about in the Puritan days. Or Pilgrim
>days? What's the diff between them, anyway?

The Puritans were a religious sect (very pure, as you can imagine).
The Pilgrims came to America (very seasick, as you can imagine).

I am reasonably sure that the Pilgrims were Puritans, but it wasn't a
necessary condition. It does not seem that Miles Standish, for
example, was very pure. Didn't he dally with Pocahontas? Or was that
John Alden? Or Priscilla? I forget.

all the best -- Dan Ford
email: (put Cubdriver in subject line)

Warbird's Forum www.warbirdforum.com
Piper Cub Forum www.pipercubforum.com
Viva Bush! www.vivabush.org

[Cub Driver]

On 06 Oct 2004 09:38:08 GMT, (Teacherjh)
wrote:

> it sure helps them infer
>how much I might be willing to pay for something they are selling.

Are you saying that Amazon has different prices for different
customers? I doubt it.

I do applaud, however, your correct use of "infer" :)

all the best -- Dan Ford
email: (put Cubdriver in subject line)

Warbird's Forum www.warbirdforum.com
Piper Cub Forum www.pipercubforum.com
Viva Bush! www.vivabush.org

[Aviv Hod]

Cub Driver wrote:
> On 06 Oct 2004 09:38:08 GMT, (Teacherjh)
> wrote:
>
>
>>it sure helps them infer
>>how much I might be willing to pay for something they are selling.
>
>
> Are you saying that Amazon has different prices for different
> customers? I doubt it.
>
> I do applaud, however, your correct use of "infer" :)
>
> all the best -- Dan Ford
> email: (put Cubdriver in subject line)
>
> Warbird's Forum www.warbirdforum.com
> Piper Cub Forum www.pipercubforum.com
> Viva Bush! www.vivabush.org


It's too much to say that the charge different prices for different
customers in general, but they have experimented with the idea. It
didn't go over well in their initial trials.

"Customers of Amazon.com, the behemoth e-commerce retailer, were
recently startled and quite upset when they learned that the online
mega-store was charging different customers different prices for the
same DVD movies.[1] Amazon, it appears, was engaging in a form of
“dynamic pricing” – an innovative pricing mechanism made possible by
recent advances in information technology."

Read more here:
http://www.vjolt.net/vol6/issue2/v6i2-a11-Weiss.html

-Aviv

[Teacherjh]

>>
Are you saying that Amazon has different prices for different
customers? I doubt it.
<<

Amazon did at one point. It caused a bit of a furor and the practice was
dropped.

Somebody said that "you can find out everything you need about Amazon by
comparing prices" (in reply to my comment that they knew far more about you
than you knew about them). When pricing is based on your personal history, in
order to find out "everything you need to know" you'd need to know the prices
that Amazon (or any other retailer) is charging your neighbors, and what their
personal history is. That information is not available to you, making it one
sided.

I saw the nose in the tent flap; the camel is out there.

Jose
(imagine the impact of newspaper articles "customized for you" to your personal
history... it's not farfetched at all)




--
(for Email, make the obvious changes in my address)

[Corky Scott]

On Thu, 07 Oct 2004 05:20:37 -0400, Cub Driver
> wrote:

>I am reasonably sure that the Pilgrims were Puritans, but it wasn't a
>necessary condition. It does not seem that Miles Standish, for
>example, was very pure. Didn't he dally with Pocahontas? Or was that
>John Alden? Or Priscilla? I forget.

Wrong area of the country. See below.

Matoaka was the beautiful and lively daughter of Powhatan, ruler of
the land that the English named Virginia. "Pocahontas" was her
childhood nickname, translated as "little wanton," meaning she was
playful and hard to control. Pocahontas saved the struggling Jamestown
colony from extinction twice. The first time (Dec. 29, 1607) is the
famous story that is retold in the Disney movie, Pocahontas, wherein
she saves the life of John Smith from execution by Powhatan, her
father. Powhatan proclaimed that Smith's life was to be spared, so
that he could make toys for Pocahontas. Whether that part of the story
is true or not, Powhatan apparently initiated Captain Smith into the
tribe as a subchief, feasted him, and returned him to the colony. When
Smith returned, he discovered that the colony had run out of food.
Pocahontas kept the colonists from starving to death that first
Winter, by visiting regularly with plenty of food.

Six years later, she saved the colony again (Apr. 24?, 1614) by
marrying colonist John Rolfe. A squad from Jamestown had kidnapped
Pocahontas, intending to trade her for concessions from Powhatan.
Powhatan only met enough of their demands to keep negotiations open.
During her captivity, leading colonists worked to convert her to
Christianity. One of those colonists, John Rolfe, fell in love with
her, and she with him. Pocahontas married John Rolfe, accepted
Christianity, and was baptized Rebecca. This marriage created several
years of peace between the Jamestown colonists and Powhatan's tribes.

Pocahontas' life ended on a high note, with a triumphal tour of
England (Starting June 3, 1616) as a visiting princess. This part of
her life is covered in Disney's Pocahontas II: Journey to a New World.
As she started home, English disease took her life. She was buried in
the church at Gravesend, England (Mar. 17, 1617) age 21 or 22. (Her
exact birth date is uncertain: roughly 1595.)

It would not be the first time American Indians proved susceptible to
English desease.

Corky Scott

PS, the above history brief was written by a man who claims to be a
descendent of Pocahontas.

[Andrew Gideon]

Teacherjh wrote:

> That information is not available to you, making it
> one sided.


As soon as Amazon started their dynamic pricing, I started building a
"dynamic pricing comparison" tool. For the obvious reason, I never
finished it. But your assumption that this would be one-sided is
incorrect.

Consumers already have a number of options to compare pricing "in bulk"
(that is, over a large number of sellers). Amazon's was the next logic
step, with my tool (and I'm sure I wasn't alone in that) being the one to
follow.

Having a slight background in financial instruments which are subject to
arbitrage, I was rather looking forward to this "fight". It would have
been fun, it would have kept avid shoppers (that enjoy the "game" of
price-shopping) happy, it would have generated at least a few products
along the way...

Ah, well.

- Andrew

[Teacherjh]

>>
Consumers already have a number of options to compare pricing "in bulk"
(that is, over a large number of sellers). Amazon's was the next logic
step
<<

That's not the issue. The information is of asymmetrical value anyway. I
might be able to find out what prices other stores will offer =me=, but I can't
find out (in bulk) what prices any given dynamic store is offering to my
neighbors. That's where my barganing power would come from. There are more
neighbors than stores. And it's not like I can make a counteroffer at Macy's.

Jose



--
(for Email, make the obvious changes in my address)

[Cub Driver]

On Thu, 07 Oct 2004 08:32:25 -0400, Aviv Hod
> wrote:

>t's too much to say that the charge different prices for different
>customers in general, but they have experimented with the idea. It
>didn't go over well in their initial trials.

Well, this would explain why Amazon forbids its "Associates" (folks
who link to Amazon books etc on their websites) from ever mentioning
price. Even when there's an XML feed from Amazon (hence it's Amz
supplying the price) they are required to disclaim: Prices Subject to
Change.

all the best -- Dan Ford
email: (put Cubdriver in subject line)

Warbird's Forum www.warbirdforum.com
Piper Cub Forum www.pipercubforum.com
Viva Bush! www.vivabush.org

[Cub Driver]

>And it's not like I can make a counteroffer at Macy's.

Sure you can! People do it all the time.

Well, I don't. I sulk and go elsewhere--usually online.

all the best -- Dan Ford
email: (put Cubdriver in subject line)

Warbird's Forum www.warbirdforum.com
Piper Cub Forum www.pipercubforum.com
Viva Bush! www.vivabush.org