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The laws of the capitalist mode of production heavily favour accumulation of capital and inheritance of it, Oscar Wilde noted the hideous disparity even in the

by ue_ 9y ago

The laws of the capitalist mode of production heavily favour accumulation of capital and inheritance of it, Oscar Wilde noted the hideous disparity even in the 19th century, Kropotkin did the same. "In virtue of this monstrous system, the son of the worker, on entering life, finds no field which he may till, no machine which he may tend, no mine in which he may dig, without accepting to leave a great part of what he will produce to a master. He must sell his labour for a scant and uncertain wage. His father and his grandfather have toiled to drain this field, to build this mill, to perfect this machine. They gave to the work the full measure of their strength, and what more could they give? But their heir comes into the world poorer than the lowest savage. If he obtains leave to till the fields, it is on condition of surrendering a quarter of the produce to his master, and another quarter to the government and the middlemen." (From The Conquest of Bread)

eru 9y ago
You say that like accumulation of capital is a bad thing. It's good: capital competes with capital to lowers its rates of return. We need more capital. The real culprit is land: we don't accumulate any more of that, so it's rates of return don't vanish.
- ue_ 9y ago
  >The real culprit is land: we don't accumulate any more of that, so it's rates of return don't vanish. An interesting point to this is the land value tax, advocated by Georgists (whom Einstein was sympathetic to). > It's good: capital competes with capital to lowers its rates of return. We need more capital. Can you expand on what you mean by this, please? Why does there need to be competition?
  - eru 9y ago
    Yes, I was hinting at Georgism myself. > Can you expand on what you mean by this, please? Why does there need to be competition? All of GDP basically gets split between land, labour and capital. As sort-of Georgist libertarian/socialists, we want as much of that to go to labour as possible, but without shrinking the pie. We redirect land's share via an LVT. But we don't want to tax capital: but fortunately, the competition between capital goods will lead to lower rates of return. The owner of the first factory might make lots of profit. The owner of the second factory less so, and the third might barely break even. The surplus can go to consumers and workers. (Not sure if that was better explained?)
- HarryHirsch 9y ago
  Land? You'd think it's machinery that is the means of production and ownership of that becomes more concentrated. Back then you would give a manuscript to your secretary who would type it, hand it to the typesetter, and it would go to the printer, both skilled tradesman and unionized. Now you yourself submit camera-ready copy to the publisher and pay a subscription for Office 365 year after year. You ask yourself why the price of scientific journals hasn't dropped, but the missing land tax isn't the reason.
  - eru 9y ago
    Machinery deprecates pretty quickly, and we can produce more of it, eroding any excess returns. I'm also not quite sure what this American obsession with unions is about. Actually, the price for reading science has dropped to almost zero. But, of course, not if you restrict yourself to paying for scientific journals. (The monopolies there that drive high costs are the result of a really weird system---and yes, that one's not got to do much with land rents nor equipment. It's closer to regulatory capture, and entrenched interests.)
- mrow84 9y ago
  > capital competes with capital to lowers its rates of return. We need more capital. Wouldn't lowering rates of return on capital disincentivise investment in new capital? If that was the most important dynamic then presumably the greatest amount of aggregate capital would be obtained through capital redistribution?
  - eru 9y ago
    Yes, lowering rates of return on capital disincentivise capital investment. But that's alright: on the scale of the whole economy the only reason to invest in capital is to consume more. A scarcity of capital leads to higher rates of return. A glut of capital leads to lower rates of return. There's an equilibrium in the middle. My "We need more capital." was spoken from the point of view of someone selling their labour for a living: for me as a worker, there can't be enough capital.
- mrow84 9y ago
  > capital competes with capital to lowers its rates of return. We need more capital. Wouldn't lowering rates of return on capital disincentivise investment in new capital? If that was the most important dynamic then presumably the greatest amount of aggregate capital would be obtained through capital redistribution?
nbanks 9y ago
Wilde is interesting because he was a socialist before anyone had tried communism. Years ago, I read an essay is his, "The Heart of Man After Socialism" where he argued that people are inherently benevolent, but the capitalist system made them greedy. Unfortunately, communism showed that greed is a much better motivator which is probably the primary reason capitalism has flourished. (I say unfortunately, because it would be wonderful if there were a better society than capitalism, though one could argue that a most European nations are some sort of hybrid which is better.) In short, Wilde may have understood the problem, but history has disproved his solution. That said, he also advocated that menial tasks such as sweeping the floor should be done by machines instead of people, and in this respect I wholeheartedly agree. Washing machines, vacuums and dishwashers have improved everyone's lives in the past century...at least everyone in the richer parts of the world.
- ue_ 9y ago
  > Unfortunately, communism showed that greed is a much better motivator which is probably the primary reason capitalism has flourished. I don't think we've given Communism a good go, especially as those societies in the modern world (i.e after the advent of capitalism) have been capitalist states, either internally or externally to other nations. The fact is that in the absence of a motivator for money, people will do things for a variety of reasons, including wanting to make the world a better place, out of a desire for mastery, desire for recognition, out of wanting to improve the lives of those who will come after you, to live in a society you want to live in (everyone wants to live in a society with clean toilets) etc. It is also a fact that these motivators only appear in two cases, (i) when people have enough money to not have to worry about survival and being satisfied (ii) when people have no need for money, as they are already satisfied. Neither of these cases has happened yet.

by ue_ 9y ago

eru 9y ago

You say that like accumulation of capital is a bad thing. It's good: capital competes with capital to lowers its rates of return. We need more capital. The real culprit is land: we don't accumulate any more of that, so it's rates of return don't vanish.

ue_ 9y ago
>The real culprit is land: we don't accumulate any more of that, so it's rates of return don't vanish. An interesting point to this is the land value tax, advocated by Georgists (whom Einstein was sympathetic to). > It's good: capital competes with capital to lowers its rates of return. We need more capital. Can you expand on what you mean by this, please? Why does there need to be competition?
- eru 9y ago
  Yes, I was hinting at Georgism myself. > Can you expand on what you mean by this, please? Why does there need to be competition? All of GDP basically gets split between land, labour and capital. As sort-of Georgist libertarian/socialists, we want as much of that to go to labour as possible, but without shrinking the pie. We redirect land's share via an LVT. But we don't want to tax capital: but fortunately, the competition between capital goods will lead to lower rates of return. The owner of the first factory might make lots of profit. The owner of the second factory less so, and the third might barely break even. The surplus can go to consumers and workers. (Not sure if that was better explained?)
HarryHirsch 9y ago
Land? You'd think it's machinery that is the means of production and ownership of that becomes more concentrated. Back then you would give a manuscript to your secretary who would type it, hand it to the typesetter, and it would go to the printer, both skilled tradesman and unionized. Now you yourself submit camera-ready copy to the publisher and pay a subscription for Office 365 year after year. You ask yourself why the price of scientific journals hasn't dropped, but the missing land tax isn't the reason.
- eru 9y ago
  Machinery deprecates pretty quickly, and we can produce more of it, eroding any excess returns. I'm also not quite sure what this American obsession with unions is about. Actually, the price for reading science has dropped to almost zero. But, of course, not if you restrict yourself to paying for scientific journals. (The monopolies there that drive high costs are the result of a really weird system---and yes, that one's not got to do much with land rents nor equipment. It's closer to regulatory capture, and entrenched interests.)
mrow84 9y ago
> capital competes with capital to lowers its rates of return. We need more capital. Wouldn't lowering rates of return on capital disincentivise investment in new capital? If that was the most important dynamic then presumably the greatest amount of aggregate capital would be obtained through capital redistribution?
- eru 9y ago
  Yes, lowering rates of return on capital disincentivise capital investment. But that's alright: on the scale of the whole economy the only reason to invest in capital is to consume more. A scarcity of capital leads to higher rates of return. A glut of capital leads to lower rates of return. There's an equilibrium in the middle. My "We need more capital." was spoken from the point of view of someone selling their labour for a living: for me as a worker, there can't be enough capital.
mrow84 9y ago
> capital competes with capital to lowers its rates of return. We need more capital. Wouldn't lowering rates of return on capital disincentivise investment in new capital? If that was the most important dynamic then presumably the greatest amount of aggregate capital would be obtained through capital redistribution?

nbanks 9y ago

Wilde is interesting because he was a socialist before anyone had tried communism. Years ago, I read an essay is his, "The Heart of Man After Socialism" where he argued that people are inherently benevolent, but the capitalist system made them greedy. Unfortunately, communism showed that greed is a much better motivator which is probably the primary reason capitalism has flourished. (I say unfortunately, because it would be wonderful if there were a better society than capitalism, though one could argue that a most European nations are some sort of hybrid which is better.) In short, Wilde may have understood the problem, but history has disproved his solution. That said, he also advocated that menial tasks such as sweeping the floor should be done by machines instead of people, and in this respect I wholeheartedly agree. Washing machines, vacuums and dishwashers have improved everyone's lives in the past century...at least everyone in the richer parts of the world.

ue_ 9y ago
> Unfortunately, communism showed that greed is a much better motivator which is probably the primary reason capitalism has flourished. I don't think we've given Communism a good go, especially as those societies in the modern world (i.e after the advent of capitalism) have been capitalist states, either internally or externally to other nations. The fact is that in the absence of a motivator for money, people will do things for a variety of reasons, including wanting to make the world a better place, out of a desire for mastery, desire for recognition, out of wanting to improve the lives of those who will come after you, to live in a society you want to live in (everyone wants to live in a society with clean toilets) etc. It is also a fact that these motivators only appear in two cases, (i) when people have enough money to not have to worry about survival and being satisfied (ii) when people have no need for money, as they are already satisfied. Neither of these cases has happened yet.