4 ms·

How would you change it short of overthrowing capitalism? Capitalism, almost by definition, "allows the rich to increase their wealth without actually working"

How would you change it short of overthrowing capitalism? Capitalism, almost by definition, "allows the rich to increase their wealth without actually working" (although of course less wealthy people can do the same). Parent poster proposed a way to help workers by changing the incentives in the system to reinvest more into productivity/research, without throwing out the system that has made our society propsperous.

moe-n 9y ago
In the past there wasn't as much pressure on capitalism to be sustainable at a global level. This pressure has increased without anyone doing anything. Which means you just have to wait for one or two more 2008 level meltdowns.
dredmorbius 9y ago
Taxing capital itself, rent-generating assets, and inheritance. Providing for a living working wage. Providing for labour unionisation or equivalent functions. Curtailing the capability of the wealthy to seek self-serving concessions from legislatures. Supporting a vibrant programme of public schools and works. Pretty much Adam Smith's prescription in 1776.
- conanbatt 9y ago
  Dang that doesn't sound true at all. Smith arguing for unionization? Also by classical economics, you cant afford to give less than living wage because then you would kill the people that work for it.
  - dredmorbius 9y ago
    Wealth of Nations, Book I, Chapter VIII, generally. Smith doesn'tquite say "allow unions", but he makes all the arguments in favour: As soon as land becomes private property, the landlord demands a share of almost all the produce which7 the labourer can either raise, or collect from it. His rent makes the first deduction from the produce of the labour which is employed upon land....* [I]n every part of Europe, twenty workmen serve under a master for one that is independent; and the wages of labour are everywhere understood to be, what they usually are, when the labourer is one person, and the owner of the stock which employs him another....The workmen desire to get as much, the masters to give as little as possible. The former are disposed to combine in order to raise, the latter in order to lower the wages of labour. It is not, however, difficult to foresee which of the two parties must ... have the advantage in the dispute, and force the other into a compliance with their terms. The masters, being fewer in number, can combine much more easily; and the law, besides, authorizes, or at least does not prohibit their combinations, while it prohibits those of the workmen. We have no acts of parliament against combining to lower the price of work; but many against combining to raise it. In all such disputes the masters can hold out much longer. We rarely hear ... of the combinations of masters, though frequently of those of workmen. But whoever imagines ... that masters rarely combine, is as ignorant of the world as of the subject. Masters are always and everywhere in a sort of tacit, but constant and uniform combination, not to raise the wages of labour above their actual rate. To violate this combination is everywhere a most unpopular action, and a sort of reproach to a master among his neighbours and equals. We seldom, indeed, hear of this combination, because it is the usual, and one may say, the natural state of things, which nobody ever hears of. Masters, too, sometimes enter into particular combinations to sink the wages of labour even below this rate. These are always conducted with the utmost silence and secrecy, till the moment of execution, and when the workmen yield, as they sometimes do, without resistance, though severely felt by them, they are never heard of by other people. Such combinations, however, are frequently resisted by a contrary defensive combination of the workmen ... But whether their combinations be offensive or defensive, they are always abundantly heard of. In order to bring the point to a speedy decision, they have always recourse to the loudest clamour, and sometimes to the most shocking violence and outrage. They are desperate, and act with the folly and extravagance of desperate men, who must either starve, or frighten their masters into an immediate compliance with their demands. The masters upon these occasions are just as clamorous upon the other side, and never cease to call aloud for the assistance of the civil magistrate, and the rigorous execution of those laws which have been enacted with so much severity against the combinations of servants, labourers, and journeymen.... A man must always live by his work, and his wages must at least be sufficient to maintain him. They must even upon most occasions be somewhat more; otherwise it would be impossible for him to bring up a family, and the race of such workmen could not last beyond the first generation. https://en.m.wikisource.org/wiki/The_Wealth_of_Nations/Book_I/Chapter_8 https://en.m.wikisource.org/wiki/The_Wealth_of_Nations/Book_...
    - conanbatt 9y ago
      I remember. That the employers monopolize and combine and have advantages over the worker is established, but not that doing the same on the other side would be beneficial. He mentions in spirit on in parallel that any measure to try to reduce that power of monopolization would be either ineffectual or make it worse. Within the Smithy naivete, one could argue that unionization would mean that by necessity, employers would be require to conspire to be able to deal with unions. Of course, I don't think he had the word for union, certainly not the concept we have today, but he clearly condemns how employers are also able to use force against the gathering of workers.
      - dredmorbius 9y ago
        My read, again, is that Smith pretty much lays out the full case for unions, but stops short of overtly endorsing them. But he explains the advantage, the unfairness of circumstance, of law, of practice, and of effect. Elsewhere he's far more direct in challenging economic power. And if you read the followers of Smith, particularly Mill, that endorsement is far clearer still.
  - dredmorbius 9y ago
    Regards wages below subsistence, I strongly recommend you read Smith's account of China. Also WoN 1.8. So long as there's a surplus population, employers will not want for labour.
    - conanbatt 9y ago
      Yes, that people kill their own children, pretty gross. I wonder if that was accurate: how could he have gotten this kind of information back then? But China is a very extreme case: in general, if you dont have enough money to support a family, you wouldnt have a family, and lower wages would affect the demographic growth of the lowest earning members of society. The logical corollary for this is that you always will have people in the lowest earning spectrum, because if they earned more they would have more children, increase surplus and reduce wages. We don't have a reserve army concept yet at WoN, unfortunately. (btw Marx seems to agree 100% with this concept of lowest earning spectrum/demographics)
      - dredmorbius 9y ago
        The British East India Company as a thing by 1776 (its stock collapse, a few years earlier, is highly likely to have cloured Smith's thinking on joint stock companies generally). In 1672, the English East India Company finally secured a trading post in Taiwan - ten years after the Dutch East India Company had been expelled from the island by the Chinese. The Company was soon engaged in direct and regular trade with the Chinese from that base and was permitted to make regular voyages to Amoy, Chusan and Canton. By the turn of the century, the Company's base for the China trade was transferred from Taiwan to its "factory" at Canton. With its Royal Charter, the Company was granted the privilege of monopoly of trade in the East Indies until 1833. From 1700 onwards, most foreign traders were confined in Canton, where rigid restrictions were imposed through the practice of Co-hong, a guild of Chinese merchants, the sole recognized agency between foreign and Chinese merchants. http://www.bl.uk/reshelp/findhelpregion/asia/china/guidesources/chinatrade/ http://www.bl.uk/reshelp/findhelpregion/asia/china/guidesour... You can also find David Ricardo and Malthus in agreement on wages. Ricardo gives us the subsistence theory of wages (I associate this as the Iron Law of Wages though that may be incorrect ... ah, J.K. Galbraith, whom I've read, makes that attribution): https://en.m.wikipedia.org/wiki/Iron_law_of_wages https://en.m.wikipedia.org/wiki/Iron_law_of_wages

moe-n 9y ago

In the past there wasn't as much pressure on capitalism to be sustainable at a global level. This pressure has increased without anyone doing anything. Which means you just have to wait for one or two more 2008 level meltdowns.

dredmorbius 9y ago

Taxing capital itself, rent-generating assets, and inheritance. Providing for a living working wage. Providing for labour unionisation or equivalent functions. Curtailing the capability of the wealthy to seek self-serving concessions from legislatures. Supporting a vibrant programme of public schools and works. Pretty much Adam Smith's prescription in 1776.

conanbatt 9y ago
Dang that doesn't sound true at all. Smith arguing for unionization? Also by classical economics, you cant afford to give less than living wage because then you would kill the people that work for it.
- dredmorbius 9y ago
  Wealth of Nations, Book I, Chapter VIII, generally. Smith doesn'tquite say "allow unions", but he makes all the arguments in favour: As soon as land becomes private property, the landlord demands a share of almost all the produce which7 the labourer can either raise, or collect from it. His rent makes the first deduction from the produce of the labour which is employed upon land....* [I]n every part of Europe, twenty workmen serve under a master for one that is independent; and the wages of labour are everywhere understood to be, what they usually are, when the labourer is one person, and the owner of the stock which employs him another....The workmen desire to get as much, the masters to give as little as possible. The former are disposed to combine in order to raise, the latter in order to lower the wages of labour. It is not, however, difficult to foresee which of the two parties must ... have the advantage in the dispute, and force the other into a compliance with their terms. The masters, being fewer in number, can combine much more easily; and the law, besides, authorizes, or at least does not prohibit their combinations, while it prohibits those of the workmen. We have no acts of parliament against combining to lower the price of work; but many against combining to raise it. In all such disputes the masters can hold out much longer. We rarely hear ... of the combinations of masters, though frequently of those of workmen. But whoever imagines ... that masters rarely combine, is as ignorant of the world as of the subject. Masters are always and everywhere in a sort of tacit, but constant and uniform combination, not to raise the wages of labour above their actual rate. To violate this combination is everywhere a most unpopular action, and a sort of reproach to a master among his neighbours and equals. We seldom, indeed, hear of this combination, because it is the usual, and one may say, the natural state of things, which nobody ever hears of. Masters, too, sometimes enter into particular combinations to sink the wages of labour even below this rate. These are always conducted with the utmost silence and secrecy, till the moment of execution, and when the workmen yield, as they sometimes do, without resistance, though severely felt by them, they are never heard of by other people. Such combinations, however, are frequently resisted by a contrary defensive combination of the workmen ... But whether their combinations be offensive or defensive, they are always abundantly heard of. In order to bring the point to a speedy decision, they have always recourse to the loudest clamour, and sometimes to the most shocking violence and outrage. They are desperate, and act with the folly and extravagance of desperate men, who must either starve, or frighten their masters into an immediate compliance with their demands. The masters upon these occasions are just as clamorous upon the other side, and never cease to call aloud for the assistance of the civil magistrate, and the rigorous execution of those laws which have been enacted with so much severity against the combinations of servants, labourers, and journeymen.... A man must always live by his work, and his wages must at least be sufficient to maintain him. They must even upon most occasions be somewhat more; otherwise it would be impossible for him to bring up a family, and the race of such workmen could not last beyond the first generation. https://en.m.wikisource.org/wiki/The_Wealth_of_Nations/Book_I/Chapter_8 https://en.m.wikisource.org/wiki/The_Wealth_of_Nations/Book_...
  - conanbatt 9y ago
    I remember. That the employers monopolize and combine and have advantages over the worker is established, but not that doing the same on the other side would be beneficial. He mentions in spirit on in parallel that any measure to try to reduce that power of monopolization would be either ineffectual or make it worse. Within the Smithy naivete, one could argue that unionization would mean that by necessity, employers would be require to conspire to be able to deal with unions. Of course, I don't think he had the word for union, certainly not the concept we have today, but he clearly condemns how employers are also able to use force against the gathering of workers.
    - dredmorbius 9y ago
      My read, again, is that Smith pretty much lays out the full case for unions, but stops short of overtly endorsing them. But he explains the advantage, the unfairness of circumstance, of law, of practice, and of effect. Elsewhere he's far more direct in challenging economic power. And if you read the followers of Smith, particularly Mill, that endorsement is far clearer still.
- dredmorbius 9y ago
  Regards wages below subsistence, I strongly recommend you read Smith's account of China. Also WoN 1.8. So long as there's a surplus population, employers will not want for labour.
  - conanbatt 9y ago
    Yes, that people kill their own children, pretty gross. I wonder if that was accurate: how could he have gotten this kind of information back then? But China is a very extreme case: in general, if you dont have enough money to support a family, you wouldnt have a family, and lower wages would affect the demographic growth of the lowest earning members of society. The logical corollary for this is that you always will have people in the lowest earning spectrum, because if they earned more they would have more children, increase surplus and reduce wages. We don't have a reserve army concept yet at WoN, unfortunately. (btw Marx seems to agree 100% with this concept of lowest earning spectrum/demographics)
    - dredmorbius 9y ago
      The British East India Company as a thing by 1776 (its stock collapse, a few years earlier, is highly likely to have cloured Smith's thinking on joint stock companies generally). In 1672, the English East India Company finally secured a trading post in Taiwan - ten years after the Dutch East India Company had been expelled from the island by the Chinese. The Company was soon engaged in direct and regular trade with the Chinese from that base and was permitted to make regular voyages to Amoy, Chusan and Canton. By the turn of the century, the Company's base for the China trade was transferred from Taiwan to its "factory" at Canton. With its Royal Charter, the Company was granted the privilege of monopoly of trade in the East Indies until 1833. From 1700 onwards, most foreign traders were confined in Canton, where rigid restrictions were imposed through the practice of Co-hong, a guild of Chinese merchants, the sole recognized agency between foreign and Chinese merchants. http://www.bl.uk/reshelp/findhelpregion/asia/china/guidesources/chinatrade/ http://www.bl.uk/reshelp/findhelpregion/asia/china/guidesour... You can also find David Ricardo and Malthus in agreement on wages. Ricardo gives us the subsistence theory of wages (I associate this as the Iron Law of Wages though that may be incorrect ... ah, J.K. Galbraith, whom I've read, makes that attribution): https://en.m.wikipedia.org/wiki/Iron_law_of_wages https://en.m.wikipedia.org/wiki/Iron_law_of_wages