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Nothing happens with out squabbling about government policy. Government policy literally defines the rules of the market. It is government policy that allows

Nothing happens with out squabbling about government policy. Government policy literally defines the rules of the market. It is government policy that allows investors to ask for equity ownership. Government policy defines the legal shapes organizations and business can take. Government policy defines the very existence of property (personal and otherwise). You cannot remove government policy from the equation. It's like trying to solve a problem with code while removing the computer. The code runs on the computer, with out it, it's meaningless.

BobbyJo 4y ago
While I agree with your point to a degree, I think you are taking it to an extreme. Government policy may lay ground rules, like private property, but 99% of any given agreement, like equity for cash, is precedence and preference, not legislative decision. The government could stop passing any new laws and things would chug along fine for quite a while. I think that was the parent's point. We don't need anything new out g Washington, as driving prices to 0 is already pretty strongly incentivized.
- dbingham 4y ago
  Driving prices to 0 is not incentivized at all, in fact quite the opposite. The current system incentivizes driving prices as high as humanly possible in order to allow the investors to take get as much of a return as they can. That's part of what's driving inflation. And that's what inevitably happens when sectors consolidate towards monopoly or small enough oligopolies where company's convergent interests can align and they start competing on things other than price. This is part of what we see driving current inflation. There's a lot of talk about how the labor market is driving inflation, or pandemic shocks are, and both of those are true. But corporate profits are still at record highs and rising. If supply shocks and labor prices were truly the main driver, then corporate profits should be near zero. They're not. Companies are taking advantage of the fact that inflation is already going up and that they have convenient scapegoats to raise their prices far more than they need to in order to cover labor increases or increase supply. There are reports of executives bragging about this to their boards. [1] Edit: To follow up, these ideas that the Capitalist free market system and competition incentivize innovation aren't actually founded in empirical research of any kind. It's pure theorizing and it's theorizing based on a house of cards of bad assumptions. One can zoom out and look at history and see that the standard of living for people has steadily increased, and humans have steadily innovated. But there's no empirical evidence to support the idea that it's a capitalist free market driving those advances. Yes they advanced further in free societies, most of which have up until now employed some version of a Capitalist free market linked to more or less social democracy. But you could just as readily theorize that those advances are just down to an innate desire in people to make the world a better place for everyone, an innate desire to innovate. And that authoritarian societies squash their opportunities to do so, while freer societies leave enough opportunities open that they enable them. But they don't necessarily add incentives for that innovation in addition to the innate incentives. [1]https://www.businessinsider.com/big-companies-keep-bragging-to-investors-about-price-hikes-2021-11 https://www.businessinsider.com/big-companies-keep-bragging-...
  - BobbyJo 4y ago
    > Driving prices to 0 is not incentivized at all, in fact quite the opposite. The current system incentivizes driving prices as high as humanly possible in order to allow the investors to take get as much of a return as they can. The two are actually not mutually exclusive. Each node in the market tried to push their own costs to 0 and their own prices to INF. The net effect is what matters, and in a competitive market the net is to move toward 0. Software is a great example. Tons of money pours into it specifically because products can be provided with near 0 marginal cost. > To follow up, these ideas that the Capitalist free market system and competition incentivize innovation aren't actually founded in empirical research of any kind. It's pure theorizing and it's theorizing based on a house of cards of bad assumptions If you ignore the largest most comprehensive experiment on the planet, the global market, then sure. Markets with stable, enforceable, property laws do better than any other setup.
osigurdson 4y ago
As long as government policy is focused on everyone living like the ultra-rich, sure. I'd like to see the average citizen of Burundi with their own private, zero emission jet which can be constructed from stuff lying around on the ground and powered by free solar energy. It's merely re-arranging atoms after all. Let's get better at re-arranging atoms.

BobbyJo 4y ago

While I agree with your point to a degree, I think you are taking it to an extreme. Government policy may lay ground rules, like private property, but 99% of any given agreement, like equity for cash, is precedence and preference, not legislative decision. The government could stop passing any new laws and things would chug along fine for quite a while. I think that was the parent's point. We don't need anything new out g Washington, as driving prices to 0 is already pretty strongly incentivized.

dbingham 4y ago
Driving prices to 0 is not incentivized at all, in fact quite the opposite. The current system incentivizes driving prices as high as humanly possible in order to allow the investors to take get as much of a return as they can. That's part of what's driving inflation. And that's what inevitably happens when sectors consolidate towards monopoly or small enough oligopolies where company's convergent interests can align and they start competing on things other than price. This is part of what we see driving current inflation. There's a lot of talk about how the labor market is driving inflation, or pandemic shocks are, and both of those are true. But corporate profits are still at record highs and rising. If supply shocks and labor prices were truly the main driver, then corporate profits should be near zero. They're not. Companies are taking advantage of the fact that inflation is already going up and that they have convenient scapegoats to raise their prices far more than they need to in order to cover labor increases or increase supply. There are reports of executives bragging about this to their boards. [1] Edit: To follow up, these ideas that the Capitalist free market system and competition incentivize innovation aren't actually founded in empirical research of any kind. It's pure theorizing and it's theorizing based on a house of cards of bad assumptions. One can zoom out and look at history and see that the standard of living for people has steadily increased, and humans have steadily innovated. But there's no empirical evidence to support the idea that it's a capitalist free market driving those advances. Yes they advanced further in free societies, most of which have up until now employed some version of a Capitalist free market linked to more or less social democracy. But you could just as readily theorize that those advances are just down to an innate desire in people to make the world a better place for everyone, an innate desire to innovate. And that authoritarian societies squash their opportunities to do so, while freer societies leave enough opportunities open that they enable them. But they don't necessarily add incentives for that innovation in addition to the innate incentives. [1]https://www.businessinsider.com/big-companies-keep-bragging-to-investors-about-price-hikes-2021-11 https://www.businessinsider.com/big-companies-keep-bragging-...
- BobbyJo 4y ago
  > Driving prices to 0 is not incentivized at all, in fact quite the opposite. The current system incentivizes driving prices as high as humanly possible in order to allow the investors to take get as much of a return as they can. The two are actually not mutually exclusive. Each node in the market tried to push their own costs to 0 and their own prices to INF. The net effect is what matters, and in a competitive market the net is to move toward 0. Software is a great example. Tons of money pours into it specifically because products can be provided with near 0 marginal cost. > To follow up, these ideas that the Capitalist free market system and competition incentivize innovation aren't actually founded in empirical research of any kind. It's pure theorizing and it's theorizing based on a house of cards of bad assumptions If you ignore the largest most comprehensive experiment on the planet, the global market, then sure. Markets with stable, enforceable, property laws do better than any other setup.

osigurdson 4y ago

As long as government policy is focused on everyone living like the ultra-rich, sure. I'd like to see the average citizen of Burundi with their own private, zero emission jet which can be constructed from stuff lying around on the ground and powered by free solar energy. It's merely re-arranging atoms after all. Let's get better at re-arranging atoms.