4 ms·
Except you're imagining power in entirely the wrong place. It is the consumers who hold all the power within a free economy. Corporations only become large and
by ancap 9y ago
Except you're imagining power in entirely the wrong place. It is the consumers who hold all the power within a free economy. Corporations only become large and profitable in a free economy when they meet the ever increasing demands of the consumers. To quote Ludwig von Mises:
The real bosses, in the capitalist system of market economy, are the consumers. They, by their buying and by their abstention from buying, decide who should own the capital and run the plants. They determine what should be produced and in what quantity and quality. Their attitudes result either in profit or in loss for the enterpriser. They make poor men rich and rich men poor.
The consumers are merciless. They never buy in order to benefit a less efficient producer and to protect him against the consequences of his failure to manage better. They want to be served as well as possible. And the working of the capitalist system forces the entrepreneur to obey the orders issued by the consumers.
The consumers are no easy bosses. They are full of whims and fancies, changeable and unpredictable. They do not care a whit for past merit. As soon as something is offered to them that they like better or that is cheaper, they desert their old purveyors. With them nothing counts more than their own satisfaction. They bother neither about the vested interests of capitalists nor about the fate of the workers who lose their jobs if as consumers they no longer buy what they used to buy.
- s73ver 9y agoThat's a nice thought, but just about all of human history proves your entire thing wrong.
- ancap 9y agoSuch as? Please provide some examples.
- KirinDave 9y agoI don't know what the poster above you intended, but criticisms of anarcho-capitalism are a dime a dozen and largely ignored. It inevitably collapses into a feudalistic society. Can you point to an example of a sustained anarcho-capitalist society that had to maintain borders? Can't prove a negative, you know. You gotta prove positives.
- ancap 9y agoAnarcho-capitalism is a theoretical political structure which has never been attempted. But I fail to see how that's relevant to the discussion. Seems like a red herring to me. It was originally alleged that corporations hold all the power in an economy unless they are kept in line by a powerful government. I countered, stating consumers actually are the holders of power in a free economy and provided some praxeological arguments to support that claim. @s73ver then made a generic claim that history refutes my argument, without providing a single example. One merely has to provide an example of a corporation which yielded more economic power than the consumer in a free-market economy. > Can't prove a negative, you know. You gotta prove positives. I really have no idea what negative you're talking about here.
- cookiecaper 9y agoThe effect described by Von Mises is exactly what leads to this aggressive behavior from large retailers. Walmart knows that the customer doesn't care about Walmart. They go to Walmart because they believe Walmart will get them the best bang for their buck. When Walmart sets aggressive standards for its suppliers, it does so in the interest of maintaining that position, because they know that the customer will not hesitate to switch to a retailer that they perceive as being more advantageous (which usually means cheaper). It could even be seen as honorable that Walmart is on the ground doing the hard work of pressuring suppliers to ensure that they actually are able to offer rock-bottom prices, instead of just relying on marketing voodoo to create this as a phantom impression in the consumer's mind without actually attempting to affect it. The system can either try to restrain this core human tendency to jump at the most advantageous thing, in the belief that such disloyalty is a primal impulse that does not belong in 'civil society', or it can attempt to recognize this tendency and account for it organically rather than ruling it out of bounds. The extent of such tradeoffs, authoritative restriction meant to prevent damage v. organic re-routing such that damage is minimally disruptive, is always a matter of context and subjective judgment. We get into political snafus when we adopt one side of this scale as an ideal with near-religiosity and overemphasize the negative costs of the opposite side.
- SmirkingRevenge 9y agoConsumers, in aggregate, are stupid and irrational. Their wants and desires and opinions can be shaped by the entities with the most resources to peddle their influence, or the best, most believable lies. Economics can't really fix such a core design flaw in human nature, it has to be the other way around, IMHO.
- ancap 9y agoI don't agree that consumers are irrational. But I do find it interesting that your implied solution would be to empower someone or some group of people who similarly possess the same negative human trait, so they could then make overarching rules for everyone else. If nothing else you've only narrowed the target for the bad actors from billions of individuals down to a few.
- nickik 9y agoConsumers are stupid and irrational. Your solution is that the same people who you think are too stupid to look out for themselves in a market will form a state and magically do collective action to fix the very problem they were individually to stupid to solve. The problem is just, that for lots of reasons, we know that such collective action is incredibly hard. Collective action is hard in general, but if you take into account that the interest of different people are totally different it becomes close to impossible. This is well known and well researched. The only reason we can actually make collective action happen at level of modern states is because it is coercive. Voluntary collective action would never produce the Iraq war for example. Yes, humans make mistakes in markets. Everybody knows that, but there is no solution for this. Humans always make mistakes in every possible system that can exist, humans don't change. So the reason why we want a market system the waste majority of the time is because people are accountable for their own choices and have to deal with the consequences. In markets we call this profit and lost, this is the mechanism why markets in the face of the same human errors have continued to produce growth in the last 200 years. We need free human agency and allow people to make mistakes while perusing their lives goals and attempt to solve their problems in creative ways. That what we call individual freedom. This will generate prosperity. The idea that you can solve human irrationality with human institutions is a fallacy. Human irrationality is a fact, and the argument needs to be what system of relation produces the best outcome.