Politico

[a2b chris]

Bring on the revolution



Oh and jail ALL those corrupt bankers (yes i have spelt it right)

 

[school_of_science]

I don't buy into the Milton Friedman free market apologist movement, greed is not good and competition isn't exclusive to capitalism. When people talk about the good of humanity meaning greed won't equal exploitation, they're forgetting that once a firm is involved, the goodness of humanity is irrelevant. Your typical person wouldn't put children in sweat shops or test cosmetics on animals but when someone is in a firm and removed from the consequences humanity goes out the window and profit margins come in. Goverment regulation and state intervention is essential to minimise exploitation and compensate for the lack of humanity in firms.

Both capitalism and socialism claim to give most power to the individual, capitalism does so with private ownership, but inevitably the gap between rich and poor increases so much that the vast majority of resources ends up in the hands of a tiny minority, so the power of the individual only ends up in the hands of some. Socialism offers power to the people through communal ownership, but the balancing act between this and a totalitarian state has caused many socialist states, often brought in through revolution, to leave its original ideals.

I believe a mix between the two, with cooperative systems in place, allowing for private ownership, competition, collective unity and cooperation. Schemes like cooperative movements take the best of both worlds and with power being amongst many people rather than a few then there would be less need for regulation as business would be self regulating.

 

[chicoazul]

I don't buy into the Milton Friedman free market apologist movement, greed is not good and competition isn't exclusive to capitalism. When people talk about the good of humanity meaning greed won't equal exploitation, they're forgetting that once a firm is involved, the goodness of humanity is irrelevant. Your typical person wouldn't put children in sweat shops or test cosmetics on animals but when someone is in a firm and removed from the consequences humanity goes out the window and profit margins come in. Goverment regulation and state intervention is essential to minimise exploitation and compensate for the lack of humanity in firms.

Both capitalism and socialism claim to give most power to the individual, capitalism does so with private ownership, but inevitably the gap between rich and poor increases so much that the vast majority of resources ends up in the hands of a tiny minority, so the power of the individual only ends up in the hands of some. Socialism offers power to the people through communal ownership, but the balancing act between this and a totalitarian state has caused many socialist states, often brought in through revolution, to leave its original ideals.

I believe a mix between the two, with cooperative systems in place, allowing for private ownership, competition, collective unity and cooperation. Schemes like cooperative movements take the best of both worlds and with power being amongst many people rather than a few then there would be less need for regulation as business would be self regulating.

That is one excellent post. Even if you do sit on the fence a bit, which is sound by me.

 

[Bruce Wayne]

I think the way to look at it is from the point of view of the customer. As a customer you want as much choice as possible to allow for various quality points and price points to suit all needs. I see a free market as providing that choice most of the time. Obviously there are times when firms have a monopoly and those are not good and never will be good. I can forsee these times as being when governments intervene, they provide the rules of the game but don't get involved in the game.

If you're the customer in a public sector though, where does your choice come from? You have two parties and you get choice every four years. It isn't really good enough. People may say that you may choose to educate your child privately or go to a private hospital, but that's akin to saying you have to pay for a Liverpool season ticket from your salary (have to as in its the law, don't and you face jail), but you're free to buy an Everton one after that. Many can't afford two season tickets, but would have liked the choice over how they spent the first.

That is essentially it for me. Don't get bogged down with public vs private debate. Think instead of human beings. There are many (unfortunately too many) examples of people being corrupted by power in both the public and private sector. I truely believe that consumer freedom of choice, their ability to transfer where they spend their money at the point of purchase is essential in keeping human beings honest because if people aren't happy they can shift in an instant.

Its in this that the markets beat the state sector hands down, and its this reason why I'm a supporter of markets. By all means lets the government police the system but its not their job to participate in it.

 

[davek]

I don't buy into the Milton Friedman free market apologist movement, greed is not good and competition isn't exclusive to capitalism. When people talk about the good of humanity meaning greed won't equal exploitation, they're forgetting that once a firm is involved, the goodness of humanity is irrelevant. Your typical person wouldn't put children in sweat shops or test cosmetics on animals but when someone is in a firm and removed from the consequences humanity goes out the window and profit margins come in. Goverment regulation and state intervention is essential to minimise exploitation and compensate for the lack of humanity in firms.

Both capitalism and socialism claim to give most power to the individual, capitalism does so with private ownership, but inevitably the gap between rich and poor increases so much that the vast majority of resources ends up in the hands of a tiny minority, so the power of the individual only ends up in the hands of some. Socialism offers power to the people through communal ownership, but the balancing act between this and a totalitarian state has caused many socialist states, often brought in through revolution, to leave its original ideals.

I believe a mix between the two, with cooperative systems in place, allowing for private ownership, competition, collective unity and cooperation. Schemes like cooperative movements take the best of both worlds and with power being amongst many people rather than a few then there would be less need for regulation as business would be self regulating.

We need the State. Without it we're down to the law of the jungle and the Hobbesian nightmare of 'red in tooth and claw' of the natural world. That's what 'competition' and 'choice' bottoms out to regardless of those marketeers who fight shy of the accusation of Social Dawinism. If you're saying it's time for the State to start taking back some of the ground it ceded to those who've been rolling it back to get their snouts in the trough of more market activity I fully agree with you mate.

World trade has collapsed, consumption has crashed. The State's moving into the vacuum and is back with a bang. I think we might see some old players on the scene. A 'new-old' social contract and the return of Corporatism.

 

[TX Bill]

I don't buy into the Milton Friedman free market apologist movement, greed is not good and competition isn't exclusive to capitalism. When people talk about the good of humanity meaning greed won't equal exploitation, they're forgetting that once a firm is involved, the goodness of humanity is irrelevant. Your typical person wouldn't put children in sweat shops or test cosmetics on animals but when someone is in a firm and removed from the consequences humanity goes out the window and profit margins come in. Goverment regulation and state intervention is essential to minimise exploitation and compensate for the lack of humanity in firms.

Both capitalism and socialism claim to give most power to the individual, capitalism does so with private ownership, but inevitably the gap between rich and poor increases so much that the vast majority of resources ends up in the hands of a tiny minority, so the power of the individual only ends up in the hands of some. Socialism offers power to the people through communal ownership, but the balancing act between this and a totalitarian state has caused many socialist states, often brought in through revolution, to leave its original ideals.

I believe a mix between the two, with cooperative systems in place, allowing for private ownership, competition, collective unity and cooperation. Schemes like cooperative movements take the best of both worlds and with power being amongst many people rather than a few then there would be less need for regulation as business would be self regulating.

Yeah no.

I'll stick with pure capitalism, warts and all.

 

[school_of_science]

We need the State. Without it we're down to the law of the jungle and the Hobbesian nightmare of 'red in tooth and claw' of the natural world. That's what 'competition' and 'choice' bottoms out to regardless of those marketeers who fight shy of the accusation of Social Dawinism. If you're saying it's time for the State to start taking back some of the ground it ceded to those who've been rolling it back to get their snouts in the trough of more market activity I fully agree with you mate.

World trade has collapsed, consumption has crashed. The State's moving into the vacuum and is back with a bang. I think we might see some old players on the scene. A 'new-old' social contract and the return of Corporatism.

The state does need to intervene, the idea that the state should allow this recession to happen is barbaric, it's like saying, OK, someone has infected the world with a virus, we have the cure, but we feel we should let the most vulnerable suffer more because it will teach us all a lesson.

Things like the NHS, education etc. should always be state owned, money should be irrelevant when it comes to access to health and education.

I believe cooperative movements based on small companies joining together to cooperate and also compete is more beneficial for all concerned. Under cooperative movements exploitation of suppliers is far less, and the benefits are spread.

The warts of capitalism is sharp recessions and 80% of world resources falling in the hands of just 1% of the world population, with this gap growing, the plight of the poorest will only worsen. It's also worth pointing out western capitalism is only kept afloat by trade barriers and corruption, for example many nations ban third world countries from manufacturing goods, thus ensuring most of the profits remain in western hands, whilst if ever a country looks like growing, you can be sure the western states will intervene with corrupting their leaders rather than allowing them to invest in the nation (Saudi Arabia) or if they're resistant, enforce trade embargos.

I believe there should be a dividing line between state and public ownership. If ownership is all in the hands of government it can become oversized and inefficient, if it remains in the hands of the people, like locally run transport run by local people, then public ownership is the best, if not only logical way for the essential public services.

 

[TX Bill]

The state does need to intervene, the idea that the state should allow this recession to happen is barbaric, it's like saying, OK, someone has infected the world with a virus, we have the cure, but we feel we should let the most vulnerable suffer more because it will teach us all a lesson.

Things like the NHS, education etc. should always be state owned, money should be irrelevant when it comes to access to health and education.

I believe cooperative movements based on small companies joining together to cooperate and also compete is more beneficial for all concerned. Under cooperative movements exploitation of suppliers is far less, and the benefits are spread.

The warts of capitalism is sharp recessions and 80% of world resources falling in the hands of just 1% of the world population, with this gap growing, the plight of the poorest will only worsen. It's also worth pointing out western capitalism is only kept afloat by trade barriers and corruption, for example many nations ban third world countries from manufacturing goods, thus ensuring most of the profits remain in western hands, whilst if ever a country looks like growing, you can be sure the western states will intervene with corrupting their leaders rather than allowing them to invest in the nation (Saudi Arabia) or if they're resistant, enforce trade embargos.

I believe there should be a dividing line between state and public ownership. If ownership is all in the hands of government it can become oversized and inefficient, if it remains in the hands of the people, like locally run transport run by local people, then public ownership is the best, if not only logical way for the essential public services.

Ooooh....and you were doing so well too.

 

[Bruce Wayne]

You reckon?

The state does need to intervene, the idea that the state should allow this recession to happen is barbaric, it's like saying, OK, someone has infected the world with a virus, we have the cure, but we feel we should let the most vulnerable suffer more because it will teach us all a lesson.

What is the cure? Indeed, what has been the cause of our current malaise?

Things like the NHS, education etc. should always be state owned, money should be irrelevant when it comes to access to health and education.

Why?

The warts of capitalism is sharp recessions and 80% of world resources falling in the hands of just 1% of the world population, with this gap growing, the plight of the poorest will only worsen.

Do you have a source for that? I only ask because if we take oil for instance, Exxon are the largest private oil company in the world, and I believe they rank 9th or 10th in the world league table behind state owned oil giants from Saudi Arabia, Venuzuela, Russia and China.

t's also worth pointing out western capitalism is only kept afloat by trade barriers and corruption

I agree that trade barriers, tariffs and quotas are an awful idea, but they're implemented by the government. Right at this minute governments are raising barriers to trade to apparently 'protect local jobs'. The problem being that every other nation then raises their own barriers and world trade grinds to a halt. Perhaps a recap of the 1930's would be helpful in what happens when this occurs. Governments provide the rules of the game, and they're messing up big time.

example many nations ban third world countries from manufacturing goods, thus ensuring most of the profits remain in western hands

Where? Which government does this?

whilst if ever a country looks like growing, you can be sure the western states will intervene with corrupting their leaders rather than allowing them to invest in the nation (Saudi Arabia) or if they're resistant, enforce trade embargos.

Again, how has a government done this? Sounds a little confused. On one hand you say that governments have the cure to our current ills, yet throughout your post you blame government for causing most of those ills. I agree that tariffs and quotas should be scrapped, they are barbaric and do untold harm to developing countries, but do you think politicians ever will do? Union leaders and other organised labour groups will kick up a stink about how they're neglecting local people etc. and the protectionism will continue. Of course union reps seldom mention how the customers do in these things but then its never about the customers is it, they're just people that evil marketers care about.

 

[davek]

I agree that trade barriers, tariffs and quotas are an awful idea, but they're implemented by the government. Right at this minute governments are raising barriers to trade to apparently 'protect local jobs'. The problem being that every other nation then raises their own barriers and world trade grinds to a halt. Perhaps a recap of the 1930's would be helpful in what happens when this occurs. Governments provide the rules of the game, and they're messing up big time..

There is no concerted policy of protectionism in place at this moment in time yet that hasn't stopped world exports falling by 40% in a year. It's all but 'grinding to a halt' as it is. This sort of precipitous collapse is built into the global economy and revealed in times of crisis. It's what happens when a very locked in and receptive system like globalisation hits the buffers. The signals are quickly spotted by all involved and confidence in the ability of others in the production process faulters decisively. Protectionism comes after the event. It isn't the cause, it's a measure to shore up the system.

 

[Bruce Wayne]

Not true I'm afraid Dave. Members of the G20 alone have taken 47 measures to restrict trade since November 2008. Tighter licensing requirements, import bans and anti-dumping have all been used. Many stimulus packages have insisted upon local procurement, with America being a prime example, not to mention many subsidies to domestic companies.

 

[davek]

The downturn in trade was well under way by that date. Shutting the stable door after it's bolted it's called. In any case, that's hardly the withdrawal into trading blocks like the Eurozone, NAFTA, ASEAN etc. that's looming large and what most would recognise as a formalised retreat behind the barricades.

I have to laugh. The boast about the global system was that it was - as has been argued elsewhere - not so much a geared up system as a nervous system with 'neural pathways' that reacted hyper-sensitively to demand. A wonder. But now with the downturn it's apparently a system that's not so reactive and any trade contraction is due to the lumbering onto the scene of the State or transnational institutions to spoil the free flow of information and grind the whole global economy to a halt.

Unbelievable.

 

[Bruce Wayne]

The immediate cause of shrinking trade is quite clear I think. A global recession means a collapse in demand. The credit crunch adds an additional squeeze, thanks to an estimated shortfall of around $100 billion in trade finance, which lubricates 90% of world trade.

The rapid growth over the past decade was fueled in large part by the rise of global supply chains. Countries no longer specialise in finished products but rather parts of the process. Because of this, changes in demand in America (for instance) affect a wide array of countries that are part of the supply chain feeding the American market.

This interconnectedness makes imposing tariffs and other trade barriers very dangerous indeed. Countries aren't heeding this warning though. In a recent World Bank study the practice was widespread, not least in developing countries. Ecuador raised duties on 600 goods. Russia increased them on used cars. India put them up on some kinds of steel. Vertically integrated supply change amplifies these decisions and makes the economy worse as a result.

 

[davek]

The rapid growth over the past decade was fueled in large part by the rise of global supply chains. Countries no longer specialise in finished products but rather parts of the process. Because of this, changes in demand in America (for instance) affect a wide array of countries that are part of the supply chain feeding the American market..

No argument with that. The signals being sent out of the U.S. well before our own Northern Rock affair was that the world's biggests consumers weren't going to be able to hold the line for much longer. Those signals were transmitted and there's been cancellation of orders and a general mistrust of those above and below in the chain. In other words, the global system was working and it was contracting even faster than it expanded in the first place.

This interconnectedness makes imposing tariffs and other trade barriers very dangerous indeed. Countries aren't heeding this warning though. In a recent World Bank study the practice was widespread, not least in developing countries. Ecuador raised duties on 600 goods. Russia increased them on used cars. India put them up on some kinds of steel. Vertically integrated supply change amplifies these decisions and makes the economy worse as a result.

Indeed, all after the event - measures precipitated by the financial meltdown and the contraction in world trade. The crisis is 'inside the decision making cycle' now as the policy wonks would have it. That may be, but it's wholly understandable that this happens after market failure.

 

[Bruce Wayne]

The thing is though that if governments continue to adopt protectionist policies it will only excentuate the struggles we're having.