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Consequently, there is an economy. People are free to work for themselves to provide a product or service to sell to the people that produce food etc..
Here is the thing right here. Because most people do not own means of production, the only thing they can provide is a "service". The service, being their own labor. Since the owner of the means usually posseses something the laborer needs for survival, he is automatically placed at a point of duress.
Simply put.
Guy who owns the land. If he does not hire worker A, he is faced with working a few more hours a day himself, or letting some of his produce rot, or some his land not get planted. He still eats, and is still reaping the full rewards of his production value.
Worker A. If he does not decide to work for guy who has the land, he starves. He does not have the option of working enough just to feed himself like the capitalist. He must work enough to feed himself, and create an acceptable return for the capitalist for the priveledge of working on his farm.
So what happens? Well, Worker A is forced, through duress, to work on Guy who owns land farm, and he is forced to work for less then he is actually producing by the labor of his own hands. If you want to expand that, Worker A must ALSO compete against Worker B and Worker C, for that one job. This inevitably leads to a depression of wages, and an increase in quality of employee, at the employees expense. In other words, guy who owns farm land can offer $1 an hour, and since Workers A, B, and C all need that job, or they will die, they will, at their own expense, improve their skills to compete with eachother, for the priveledge of working for the pitance Guy who owns land, is offering.
However, if Workers A, B and C owned their own land, they could raise their compensation to that of their production, and would not be forced to work for far below their production value.
No, the guy who is creating the budgets, the guy who is doing the marketing campaign, the guy who is doing the accounting, the guy who is handling the legal matters, the tax preparer.
By the way, the "capitalist" is rarely the guy who built anything. The "inventor in the garage" entrepreneur is far and few between. The majority of "capitalists", are venture in nature. They have a boatload of money, which they either loan, or "invest" in someone elses good idea. Their only participation is to look at the income statement each month to see how much they are making in return.
And those obviously fairly intelligent people that accumulated wealth get to decide what the better idea is and what will sell. But government works in that same way but doesn't ask who has the best idea as far as what will sell, it's determined by which person pays more and the money isn't found through good ideas but through bad intentions. The whole government is setup on a cronyism now and we are the enablers....
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cronyism: partiality to cronies especially as evidenced in the appointment of political hangers-on to office without regard to their qualifications
Your argument only holds up when the only markets are survival items. The economy is much broader than that. The bottled water guy needs other products that he has to get from someone. While they're at work, they need someone to repair the roof over their head. They need someone to repair their car so they can get to work.
Survival items are the only thing neccessary to life. Water, land, and the resources grown in and on it. A person who has water, in trade, for his car being repaired, inherently has the upper hand. Period. The guy with the car can always fix it himself, but what about the auto repairman? He cant live without the water. Who wins in that negotiation? This is the exact same situation with any service. Services are of inherently less value then capital resouces, and creates a contract of duress. Now, guy who is trying to trade his timber, might coerce the water guy in to a fair trade, since water guy needs to build a house, and timber guy needs water.
Thing logically here. Why do you think water, land, and non renewable resource prices, rarely go down (unless they were driven up by artificial means, or the actual physical value of it is altered, for instance, the mine runs dry), and even renewable resources produced from those sources are fairly safe, and inflationary in nature, but prices for comparitable finished products and services, over time, will go down in real dollars?
Here is the thing right here. Because most people do not own means of production, the only thing they can provide is a "service". The service, being their own labor. Since the owner of the means usually posseses something the laborer needs for survival, he is automatically placed at a point of duress.
Simply put.
Guy who owns the land. If he does not hire worker A, he is faced with working a few more hours a day himself, or letting some of his produce rot, or some his land not get planted. He still eats, and is still reaping the full rewards of his production value.
Worker A. If he does not decide to work for guy who has the land, he starves. He does not have the option of working enough just to feed himself like the capitalist. He must work enough to feed himself, and create an acceptable return for the capitalist for the priveledge of working on his farm.
So what happens? Well, Worker A is forced, through duress, to work on Guy who owns land farm, and he is forced to work for less then he is actually producing by the labor of his own hands. If you want to expand that, Worker A must ALSO compete against Worker B and Worker C, for that one job. This inevitably leads to a depression of wages, and an increase in quality of employee, at the employees expense. In other words, guy who owns farm land can offer $1 an hour, and since Workers A, B, and C all need that job, or they will die, they will, at their own expense, improve their skills to compete with eachother, for the priveledge of working for the pitance Guy who owns land, is offering.
However, if Workers A, B and C owned their own land, they could raise their compensation to that of their production, and would not be forced to work for far below their production value.
So capitalism is bad because we can't all be farmers? Man of the most financially successful people provide services. Also, it's duress (want and need) that leads to the creation of new products and new markets. Your conclusions are based on cutting out a lot of other options. If you think workers now aren't getting the full value of their work, take a look at what they get under a socialist regime. Capitalism gives you a much better chance. They may not have means of production now, but they can save to get one and start a new company.
And those obviously fairly intelligent people that accumulated wealth get to decide what the better idea is and what will sell. But government works in that same way but doesn't ask who has the best idea as far as what will sell, it's determined by which person pays more and the money isn't found through good ideas but through bad intentions. The whole government is setup on a cronyism now and we are the enablers....
Im not sure where I ever said I supported state run capitalism. Hell, state run capitalism is even worse then "free market" and may arguably be the worst kind of system there is. It certainly didnt fair well in Russia, the Eastern Bloc or China.
After graduating, Friedman was unable to find academic employment, so in 1935, he followed his friend W. Allen Wallis to Washington, D.C., where Roosevelt's New Deal was "a lifesaver" for many young economists. At this stage, Friedman said that he and his wife "regarded the job-creation programs such as the WPA, CCC, and PWA appropriate responses to the critical situation".
"...the New Deal was a lifesaver for us personally,” he and his wife recalled in their memoir.
So capitalism is bad because we can't all be farmers?
IT has nothing to do with farming, farms were just an example I used. You take things far too literally.
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Originally Posted by Rggr
Man of the most financially successful people provide services.
Because they came up with something that allowed them to wedge enough pieces of capital away from the owners of capital. Often though, they had to become indebted to owners of capital to even get in a position to do this though. In addition, this does not mean it was a fair exchange.
If I dig up 20 potatoes, and 10 are considered wealthy, and I am paid 10 potatoes, Im still "wealthy", but I was still paid less in the exchange then I earned.
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Originally Posted by Rggr
Also, it's duress (want and need) that leads to the creation of new products and new markets.
Mostly want. Duress is rarely the motivation for creation of a new product. Nine times out of ten, thats greed.
Quote:
Originally Posted by Rggr
Your conclusions are based on cutting out a lot of other options. If you think workers now aren't getting the full value of their work, take a look at what they get under a socialist regime.
Who, exactly, is advocating socialism? Or are you one of those people who thinks anything that is principally in opposition to the pillars of capitalism is a synonym for eachother, ie infering that communism, facism and socialism are all the same thing.
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Originally Posted by Rggr
Capitalism gives you a much better chance. They may not have means of production now, but they can save to get one and start a new company.
1. Capitalism gives anyone who owns capital, or is profitable a chance. However, it is terribly harsh on the middle of the curve and lower. Its also harsh on people who do not provide direct profit, public school teachers, military, many public servants, social workers, etc. In a system which rewards output, not profits and investment prowess, the many would have a much greater chance, at the expense of the top fews chance of collecting rediculous wealth.
2. Why should a person EVER be in a position to sell their labor for less then its value just so they can eat?
Milton Friedman is only considered to be one of the most brilliant economists of the 20th Century.
The claim of "maldistribution of wealth" by the left is probably one of the oldest lies of the socialist/marxist mindset. This lie denies that wealth is infinitely created by production; i.e., work, whether from manual labor or other labor. In otherwords, human productivity, in all it's forms. People create wealth for themselves, from earnings and investment.
Thus, wealth is not "concentrated" at the top, but is spread according to the desire of each individual for achievement.
And I didn't take that from any book...those are my words, and too me, this is just plain common sense.
Common sense has no place on this forum!
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