"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/ar...dence_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...