The mind of a child

[Jonathon Spectre]

I came across this interview with an "anti-capitalist leftist" and was left stunned speechless. Have a glimpse into what passes for this thing's mind.

http://news.bbc.co.uk/1/hi/england/london/2976839.stm

"People are only rich because other people are poor."

Yes, work, saving money, investing wisely, etc. have nothing to do with it. I wonder, if this person lived in America, who he would be voting for...

JS

[TaiDaishar]

Basically... that statment is right, no one can be rich without the poor...

[Kasreyn]

First off, I already replied but it vanished. The lag demon ate it! ^_^

As to the quote you mention, I don't know why you think that quote would somehow bias me against the author of the article. It's clear, logical, and makes perfect sense.

The terms "rich" and "poor" exist to demarcate those with a different amount of net worth under this giant math game we call Capitalism. For one person to have "more", another person MUST, by definition, have less. A capitalist economy is an example of what is called by game theorists a "zero-sum game". This means that if you add everything up, the total value in the system remains constant; it just gets shuffled around.

Intrigued by this interesting quote, I read the article, expecting the Nefarious Anarchist Plot you made it out to be. Instead, I found an unfocused leftist ramble with few blatant logical errors and mostly a lack of overall direction or goals.

That is, the individual points Mr. Taylor makes are (mostly) correct, but he goes nowhere with them, and I really don't see what about this post could annoy you so much you'd post a flame of it here.

-Kasreyn

[--Pete]

Hi,

The terms "rich" and "poor" exist to demarcate those with a different amount of net worth under this giant math game we call Capitalism. For one person to have "more", another person MUST, by definition, have less.

Sorry, but I think that is false. If "rich" and "poor" did indeed mean the same as "having more" and "having less" then you would be right. But that is not what those words mean. Poor means living without a sufficient amount of the fundamentals (which seem to increase every year). By today's definition of poor (no electricity, inside plumbing, less than some number of square feet per person, varied and balanced diet, etc.) everyone who ever lived before 1900 was poor. ;)

Rich, OTOH, doesn't just mean having more than the poor, it means having a *lot* more than what one needs to live on. And, indeed, there are relatively few rich.

What the idiot in the interview seems to have overlooked is that most rich people, in the processes of becoming rich, generated jobs for many people who left poverty behind and entered the middle class. Not saying that it was always sweetness and light -- the history of the labor movement is way too bloody for that. But it isn't the existence of the poor that makes the rich. If anything, the making of the rich has been beneficial to society as a whole.

What the extreme socialists seem to fail to realize is that they have it in their power (if they are worth a damn, which is a BIG assumption) to get the world they want. All they have to do is what the people that started the industries did. Put up their money, put up their talents (assuming they have any other than bitching) and put up their work. Create their own means of production where they are the owners as well as the workers. Funny thing is that every time that's been tried, either by individuals or by governments, it has been a big failure. Maybe they should try to read Animal Farm. Assuming they can read.

As to capitalism being zero sum, I don't think so. All economic structures are built on the means of production. If the value of the goods produced is greater than the cost of producing them, then wealth is being generated. The distribution of that wealth can make everybody better off. If, OTOH, the goods are worth less than the cost, then wealth is disappearing and everyone is worse off (except for some "bosses" for some time). An example of such a system was the USSR under communism.

Also, capitalism is not a pure strategy as played anywhere in the world, AFAIK. To a large extent, governments exist to pass and enforce regulations to limit what capitalism can do. Which is why the combination of capitalism under a representative democracy seems to be very successful model. Perhaps not the best, but better than all those that have been tried to date.

--Pete

[Guest]

Semantics is basically all the guy originally quoted is playing with.

There is no idea behind what he said. Its just a word game. Its kind of odd that anyone here thought it was worth pondering, beyond the word game.

[Kasreyn]

By today's definition of poor ... everyone who ever lived before 1900 was poor.

This is true, but the definitions keep being ratcheted up. Why? Standard of living is slowly improving. I think the point is, some people (not everyone, but perhaps a vocal minority) believe it could be improved faster. That is, they say the rich should be keeping less capital to themselves, and reinvesting more of it into improving life for everyone on this planet, not just themselves and their do-nothing offspring. But under our laws, that's the choice of every individual rich person, and I'm not so sure the anti-rich types would behave any more selflessly if THEY had the chance to buy 50 Ferraris. =P

...most rich people, in the processes of becoming rich, generated jobs for many people who left poverty behind and entered the middle class.

What about inherited wealth? If someone inherits 20 billion from oil tycoon daddy and uses it wastefully (as most inheritors seem to), how does it create jobs or help the economy?

On the topic of capitalism being zero-sum, I feel constrained to point out a flaw in my statement (one you didn't bring up). The flaw is research - companies that accumulate enough capital can spend it on R&D - either in-house or by grant - and possibly assist some really smart labcoated type in making some discovery which will add value to the system. The labcoat will get funding and salary, the corporation will gain control over the new value (ie., patent or other copy protection measures, which leads nicely into our other debate raging ;-)

An example of such a system was the USSR under communism

This was because they thought that anyone with the right political views (ie., some commissar or other) was capable of competently running any particular industry. Simply put, they were ignorant, arrogant pricks who looked at the engineers and thinkers of the nation and thought 'aww, that ain't so hard!' So you'd see some idiot political appointee telling a factory manager to take actions that would be obviously unprofitable or useless to anyone with any experience. Or he would simply set ridiculously, impossibly high quotas under one of the 5 Year Plans. Etcetera. The soviet system was so far removed from reality than in the cold, hard world of real work it just couldn't manage things properly. The end result was, the total value in the system decreased over time. The American system is very productive, but perhaps does not attain the overall standard of living it is capable of. This is probably the fault of both the rich and the poor.

-Kasreyn

[Guest]

"The American system is very productive, but perhaps does not attain the overall standard of living it is capable of. This is probably the fault of both the rich and the poor"

Organic systems never attain what they are "capable" of.

The best you can hope for is a system that reacts to itself and readresses its actions in pursuit of its goal.

Our economic system(a buffered capitalism) does this in respect to total wealth. It does not do this in with direct respect to "standard of living".

However no system in the world matches our standard of livng over time(by over time, I mean you must consider the number of immigrants whos standard is raised here when you compare us to other countries with a high standard.)

I beleive it is appearent that "standard of living" it self is not able to drive an economy to its own benifit near as well as "wealth ; is.

[--Pete]

Hi,

That is, they say the rich should be keeping less capital to themselves, and reinvesting more of it into improving life for everyone on this planet, not just themselves and their do-nothing offspring.

Actually, the rich do this or don't stay rich long. You can consider inflation a tax on uninvested capital ;)

What about inherited wealth? If someone inherits 20 billion from oil tycoon daddy and uses it wastefully (as most inheritors seem to), how does it create jobs or help the economy?

How is the wealth being used? Is it being burned to heat an ice cave (only good line in Cliffhanger, "It costs a fortune to heat this place.")? If not, then it is being spent, used to buy goods and services. And thus it is helping in that someone has the job of making those goods and supplying those services. So that money may not help the overall economy as much as it would if used wisely, but it is still generating some jobs, still helping the economy some. After all, the economy is based on people making and doing things for other people. The only money that does not help the economy is the money stashed away in a mattress. And that money is slowly dwindling away to inflation.

The flaw is research - companies that accumulate enough capital can spend it on R&D - either in-house or by grant - and possibly assist some really smart labcoated type in making some discovery which will add value to the system.

That is just another way in which the system generates wealth. As a former (hopefully smart) labcoat, I can tell you that research is no different than steel making. You invest time and material, and the result is a product worth more than the effort (or not). If it is worth more, you've created wealth, if it isn't your job goes away ;)

Simply put, they were ignorant, arrogant pricks

Now that, as a description of the practicing Soviet communist, is admirable in its accuracy and terseness :)

However, I think the fundamental flaw is with the principle itself. Both capitalism and communism are flawed theories. Neither is based on the realities of how people interact and each leads to conflict. Which is why a certain amount of each is needed and the best result is in some form of compromise. Unbridled capitalism failed and fell in the late nineteenth and early twentieth centuries and has not really existed since (except, to a limited extent, in a few places like Hong Kong). Marxism has never really been tried (and that's probably a good thing, but if his theories have any merit, then they will come about on their own in the fullness of time and can't be rushed). The forms of communism that have been tried have failed because, as you said, they were tried by people. Perhaps communism would work, like Jeffersonian democracy, if humans were perfect beings. But, if that's the requirement, then the theory (either one) is a waste since there is no species that it is fit for.

The American system is very productive, but perhaps does not attain the overall standard of living it is capable of. This is probably the fault of both the rich and the poor.

I don't really understand what you are saying here. The American system (basically Hamiltonian economy) is what it is and does what it does. There may be some *idealized* model of the American system that would do better. There may be more value for all in a more socialist system (like Denmark's), there may be better productive potential in a less socialist system (like Taiwan's). But then, it wouldn't be the American system. And even the American system is constantly in a state of flux. The American system of JP Morgan is not that of Bill Gates. And even that of Bill is on its way out, to be replaced by some other approximation.

Evolution, not revolution? The Americans have a much more modern launch system than the Russians. The American system has been redesigned completely twice since the start of the space age, that of the Russians has simply been improved with no major change. Which one has been more productive? Which one has been shut down for three lengthy periods?

We seem to have the right idea in a political and economic system and the wrong one in technology -- must be a form of compensation ;)

--Pete

[Guest]

You launch system analogy is even better than what you mentioned.

The US system(NASA) is not driven by its own results but rather congressional interests. That has resulted in it devoping popular systems in response to forces other than thier effectiveness(the Russians scrapped a shuttle system early on because it was to exspensive to make it reasonably safe or reliable).

The Russian system starved for cash has been forced to effiecient to stay alive.

Also notable the other big launch program - USAF - is very effective.