4 ms·

capitalism didn't invent costs

danesparza 4y ago
While cost is a concept that is applicable in any economic system, capitalism places a particular emphasis on it. In a capitalist system, the cost is an essential factor of price, and firms are primarily motivated by profit maximization, which requires minimizing costs. Therefore, capitalists tend to prioritize cost-cutting measures such as outsourcing, automation, and downsizing to increase their profits. Other economic systems would have different priorities -- and could choose to put greater value on human happiness.
- iso1631 4y ago
  > Therefore, capitalists tend to prioritize cost-cutting measures That's not awful. Cost is a bad thing A key problem with capitalism is that externalities are not accounted for. Overall costs can increase, but because of the lack of accounting and an imperfect market. In any system you want to cut costs. You want to generate the same output for less input (time+resources), as that gives you more time+resources to do other things.
  - JohnFen 4y ago
    > Cost is a bad thing Is it? Stated as an absolute like this, I disagree. Take the cost of paying employees, for instance. I think it's hard to argue that's a bad thing. Employees are also customers, providing a revenue source that leads to profit.
    - iso1631 4y ago
      That is a cost, but not to the company. The employees are doing work, they are spending their time. That should be reduced. At the end of the chain is either someone spending time, spending health, or using natural resources. Those are the costs. Far better for a company to simply give the money to the employee, receive the same amount of work in return, but not have the employee spending any time What's better, paying someone $100 to dig a hole and fill it back in, or give that person $100? Imagine a world where every need is met without having to do anything, with no costs - to humans, to the environment, to resources. Think how much time that gives to people to be free to do what they want
      - JohnFen 4y ago
        You are describing a utopia. There is no reason to think such a thing is possible, and there is a whole ton of history that indicates it is not. It's not a technological problem. It's a greed problem. The people who control the resources are not going to just give them away for nothing.

While cost is a concept that is applicable in any economic system, capitalism places a particular emphasis on it. In a capitalist system, the cost is an essential factor of price, and firms are primarily motivated by profit maximization, which requires minimizing costs. Therefore, capitalists tend to prioritize cost-cutting measures such as outsourcing, automation, and downsizing to increase their profits. Other economic systems would have different priorities -- and could choose to put greater value on human happiness.

iso1631 4y ago
> Therefore, capitalists tend to prioritize cost-cutting measures That's not awful. Cost is a bad thing A key problem with capitalism is that externalities are not accounted for. Overall costs can increase, but because of the lack of accounting and an imperfect market. In any system you want to cut costs. You want to generate the same output for less input (time+resources), as that gives you more time+resources to do other things.
- JohnFen 4y ago
  > Cost is a bad thing Is it? Stated as an absolute like this, I disagree. Take the cost of paying employees, for instance. I think it's hard to argue that's a bad thing. Employees are also customers, providing a revenue source that leads to profit.
  - iso1631 4y ago
    That is a cost, but not to the company. The employees are doing work, they are spending their time. That should be reduced. At the end of the chain is either someone spending time, spending health, or using natural resources. Those are the costs. Far better for a company to simply give the money to the employee, receive the same amount of work in return, but not have the employee spending any time What's better, paying someone $100 to dig a hole and fill it back in, or give that person $100? Imagine a world where every need is met without having to do anything, with no costs - to humans, to the environment, to resources. Think how much time that gives to people to be free to do what they want
    - JohnFen 4y ago
      You are describing a utopia. There is no reason to think such a thing is possible, and there is a whole ton of history that indicates it is not. It's not a technological problem. It's a greed problem. The people who control the resources are not going to just give them away for nothing.