Misplaced Pages

Revision as of 03:38, 14 December 2005

Archive history

• Talk:Capitalism/archive
• Talk:Capitalism/archive 2
• Talk:Capitalism/archive 3
• Talk:Capitalism/archive 4
• Talk:Capitalism/archive 5
• Talk:Capitalism/archive 6
• Talk:Capitalism/archive 7
• Talk:Capitalism/archive 8, March 24 – April 1, 2005
• Talk:Capitalism/archive 9
• Talk:Capitalism/archive 10 2005-07 - 2005-10

Classes in Capitalism?

There are no classes in capitalism. Capitalism abandons the concept of 'classes'. How do you call a factory worker who owns microsoft stocks and plans to retire? I knew such a guy. There is no split like: The class that owns and the class that works. If you sit in front of a computer screen and read this, then you most probably own that computer, the screen, the mouse in your hands and the keybord before you. That's the basis of capitalism. Protection of ownership. The only economic theorist mentioned who supported the idea of classes was Marx. All the others strongly opposed such a view. I very much doubt that Milton Friedman splits the population into proletariat and bourgeoisie. Please remove general references to a 'class structure' or at least don't attribute them as truth or even as a consensus among economists. Attribute class splits in capitalism to the man who invented them: Karl Marx. (Or at least let me do it :))

Classes are just a rough way of dividing the population into categories; use whatever word you like. In capitalism people can be grouped into those who mainly work for others, and those who mainly own production means and hire others to do work for them. The divide is not so obvious to you, in a rich country, but in poorer and developing countries the divide is much more apparent. "Class" is just a word to call this divide - pick a different one if you don't like the concept of "class", but don't deny the existence of such division just because you don't experience it in your everyday life. And Karl Marx doesn't own that word, other people use it too.

Also, if you're reading this at work then the computer is obviously NOT yours. Infinity0 00:40, 12 November 2005 (UTC)

What "poorer and developing countries" are you referring to that are capitalist? RJII 02:27, 12 November 2005 (UTC)

Brazil? China? Mexico? Even in the USA there are heavy divisions, between places like Compton and Beverly Hills. Infinity0 22:54, 15 November 2005 (UTC)

Again, there's the problem of defining capitalism. Brazil, China and Mexico may be partly capitalist, yet their capitalism is much more biased than in Western countries. Property rights, for instance, may not be easily enforceable; also rich people have easier access to government services such as education or justice. Indeed, the whole judicial system may be biased in favour of rich people. Brazil is typical for that: for decades, the whole economy was closed, liberty of doing business was choked by red tape and innovation mostly blocked to preserve the advantages of a small and very rich elite. China is going the same way. Blaming these problems solely on capitalism is not really fair: the governments established those laws that maintained millions of people in poverty. Luis rib 20:04, 16 November 2005 (UTC)

What about divisions in the US? The system is biased towards rich people in the US too. Capitalism makes a few people very wealthy. Are you sure they won't use it to buy undemocratic power? Infinity0 22:17, 16 November 2005 (UTC)

Sure, the divisions in the US are quite big (though much less so than in Brazil, for instance), but that's not a failure of capitalism per se, but it's a failure of the state. Sweden is a capitalist country too (in terms of allowing free economic entreprise), yet the state has built a web of safety nets, that prevent extreme poverty (and extreme wealth) from emerging in the country. Concerning people buying undemocratic power: again, this is mostly a problem of US legislation. In most European countries, donations to political parties are limited by legislation, to prevent corporations or wealthy people from taking too much influence. It's not a problem of capitalism per se. Luis rib 19:30, 17 November 2005 (UTC)

I suppose the power-buying thing can be applied to all systems, but if wealth was more equal then maybe there would be less people with enough money to be capable of buying power? And how would the social divisions be a failure of the state, rather than a cause of the unequal economy? Infinity0 19:50, 17 November 2005 (UTC)

So you propose making everyone equally poor to prevent anyone from gaining power? The question of power-buying is a question of legislation. And of course social divisions are a mostly a failure of the state: After all, why do countries with imperfect capitalism (like Brazil and China) have higher imbalances than countries with more developped capitalism (like Europe and the US)? And, among Western countries, some have less inequality than others; in particular the Scandinavian countries have less inequality than the US for instance, even though they are very capitalist (think about Ikea, Nokia, Volvo). So clearly it is a problem of state: the Scandinavian states aim to reduce inequality (which causes very high taxes) while e.g. the American government adopts a more laissez-faire approach. Luis rib 19:37, 18 November 2005 (UTC)

I like your clever use of wording there - "equally poor". So, are you saying high taxes is NOT restricting free market, that it's a good thing? I'm glad we agree :) Still, I'm sure Scandinavian countries use other methods too, like import and export duties. In a fully free market without regulations, social divisions will naturally occur. Legislation is by definition interference, which neo-liberalists so despise. Infinity0 20:13, 18 November 2005 (UTC)

I never said that a totally free market is the best thing - a totally free market would require things like perfect information and rational actors. Since these things don't exist, the market needs an appropriate legal environment to operate properly (in particular, there's a need for protection of property rights, and to prevent cartels from emerging). Some labour laws are also necessary, of course. The details of such laws are the difficult part: make them to restrictive, and growth is prevented; make too flexible, and inequality increases. So, as you see, I'm not a neo-liberal. Concerning Scandinavia: actually they do not have special import or export duties, since they are in the EU! So they are part of the Common European Market, where no such duties are allowed among countries. Even Norway, which is not part of the EU, is in the European Economic Area. The Scandinavian countries maintain their high levels of social protection through very high taxes; in Denmark, the state takes at least 40% of your wage; in Sweden it takes even more. Luis rib 20:48, 18 November 2005 (UTC)

Oh, alright then, that makes sense. So, to what extent could an economy be regulated and still be described as capitalist? And if the economy was so controlled as to be not capitalist, would that be such a bad thing? I have no problem with 40% taxes on the rich. If I had the money, then I'd feel bad, but because I don't have it I can think clearly and know that I don't need that much. Infinity0 21:23, 18 November 2005 (UTC)

I disagree with most of the above. The three great classes, as described by Adam Smith, Ricardo, Ferguson, et al among the classical economists, are landowners (i.e. those who rely primarily on rent from tenants), capitalists and wage earners. The landowning class per se has become all but extinct, in developed countries, since the time of the above-named writers. There are also minor classes such as the petty bourgeosie (shopkeepers, self-employed tradespeople etc), small commodity producers (farmers, fishers, etc), but these are also now small numerically in developed countres and getting smaller all the time

There is a big difference in economic roles/interests between a wage earner who probably has some real estate/shares/etc but still relies on their wage to make a living, and the small minority who can live off the proceeds of share ownership/directors fees/etc. If Friedman etc didn't mention class, it's because class is irrelevant to their theories. Grant65 (Talk) 04:12, 12 November 2005 (UTC)

"Directors fees" would actually pretty much correspond to salary. Or do you believe that directors, CEOs and the like don't work? Luis rib 13:21, 12 November 2005 (UTC)

Such fees are in addition to the normal proceeds of proprietorship. Grant65 (Talk) 14:13, 12 November 2005 (UTC)

Their work/salary proportion is not equal to the lowest rank of workers. Hence, they're not the same. And what of shareholders who do nothing, who only get money because they put some money at the start, and "own" part of the company? Infinity0 20:46, 12 November 2005 (UTC)

Actually the directors are often not the owners of the companies (at least in the case of large companies). The shareholders, on the other hand, invest part of the money they saved in shares - i.e. risky assets that may or may not yield a profit. The shareholders don't work for the company but provide the capital that the company needs to operate. However, the shareholders bare the whole risk if something goes wrong. Luis rib 19:46, 14 November 2005 (UTC)

Very rarely happens, and even if it does most shareholders are wealthy enough so the loss does not affect them. That's normal human behaviour, loss aversion. But the workers can be fired any time, and are subject to competition. If they lose their jobs they lose their means to survive. They bear the real risks. And there's also the fact that they actually do stuff, whilst the shareholders don't. Infinity0 01:13, 15 November 2005 (UTC)

Actually it does happen, though it is of course quite rare that it happens in big corporations, which are all over the media. After all, most firms are small or medium sized.

Concerning shareholders, most of them are not that wealthy, and I'm pretty sure that lots of middle class people lost a lot of money during the dotcom crash. To portray the shareholders as a greedy and rich elite does not depict the reality and biases the discussion.

Also, it is wrong to believe that shareholders don't do anything: actually, they put their money into something risky, instead of just spending it on whatever they like. If shareholders didn't invest money, how could a corporation actually hire and pay workers? How could it develop and expand?

Finally, you are of course right that the workers will bear the immediate consequence if something goes wrong. That's why - contrarily of what you may believe of me - I think that the state does have a role to play, to act as a safety net in case a worker does lose his job. In the US, the state only fulfils this role to quite a small extent; in several European countries, however, the state has taken his role too far. That's one of the dilemmas of capitalism: what role should the state play. Luis rib 19:56, 16 November 2005 (UTC)

Yes, I didn't say it doesn't happen, but how many businesses have you really heard of that have bankrupted and caused heavy strain to the investors as a result? Not many. A great majority of the time, if a business goes bankrupt, then the investors lose some, but tbh it's not much compared to what they already have. They lose a lot, but not so much that they can't sustain themselves. Investors pay a one time fee. Why should they get a proportion of the profits, as opposed to a worker who works to gain the business a proportion of its profit, yet gets paid a fixed wage? Infinity0 22:17, 16 November 2005 (UTC)

There's many family businesses that fail and about which you never hear a thing. Actually, family business contribute to more than 90% of any Western country's economy - yet no-one ever speaks of them, since most are very small. Concerning the worker: earning a fixed wage is actually a protection against bad times. Each company has good and bad times; in bad times, it's the shareholders who bear the loss, while the wage earners mostly keep their wage (if they don't get fired, of course). Would you work for a company for a wage that depended totally on that company's profits? I certainly wouldn't.Luis rib 19:30, 17 November 2005 (UTC)

9 colons :D Firstly, 90%? Have you a source for this? I get the impression it's more like 20%. "The wealth of the Forbes 400 richest Americans grew by an average $940 million each from 1997 to 1999, while over a recent 12-year period the net worth of the bottom 40% of shareholders fell 80%." - Jeff Gates (from Take it Personally by Anita Roddick, 2003)

Protection against bad times is missing the point. Fixed-price wages aren't what they deserve. It works both ways - if the companies profits fall, then most of the time it's the workers' fault (and it certainly isn't the shareholder's fault); just as profits rises are the product of the worker's. And the answer to your question is yes, I would. I would be much more incented to work harder, as my work effort directly affects my wages. Infinity0 19:50, 17 November 2005 (UTC)

A professor at university showed us the stats. I found this website which makes similar claims. In some countries (like Italy) it's even higher than 90%. You assume that family business are big and that those families are huge. This is of course not true. A family-owned company can be a small restaurant, for instance. Also, you citing data from the 400 richest Americans from 1997-1999 (i.e. the peak of the dotcom boom!!!), so that's completely irrelevant. What happened to those when the bubble burst? Well, the "net worth of the bottom 40% fell 80%" until 2003 - which is perfectly logical since the bubble burst in 2000. Also, you are wrong just to look at share prices: that just shows the evolution of the largest corporations of the country, i.e. those that are listed on a stock exchange. Those largest corporations may be very famous, but actually just contribute to a small percentage of a nations GDP.

I'm surprised that you would accept a wage completely linked to merit. That's after all something that liberal economist encourage all along! Luis rib 19:37, 18 November 2005 (UTC)

From your source: Family businesses comprise 80 to 90 percent of all business enterprises in North America (Family Business Review, Summer 1996) - this does not mean it comprises 80-90% of the ECONOMY. The source only talks about number of businesses, not number of workers, or profit values. And many huge corporations call themselves "family busineses" (ie the family members get the top positions), rendering your source invalid. Many family business fail but it's only the small ones. You haven't actually provided any money figures about GDP.

Why is that a surprise? You don't know me, did you assume I was a Marxist? But do you see my point? Fixed-wages are unfair, because the worker earns the company a proportion of its profits, whilst variable investment prices are unfair, as the investor only ever pays one starting fee. Infinity0 20:13, 18 November 2005 (UTC)

Big family business are just small family businesses that have become very successful. Of course most business failures concern small companies: big companies have survived many difficulties and are thus more resistent to external shocks, special events and economic downturns.

Why are variable investment prices unfair? Investment prices are supposed to reflect the value of a company - this value is evaluated differently by different people and depends on general economic events. Also, the investor does not pay a fee - the investor puts a part of his/her savings into a company. These savings are blocked, and the investor can only use them if he sells the investment again - at a price which will depend on the value of the company at that time. Luis rib 20:48, 18 November 2005 (UTC)

Why are they "supposed" to reflect the "value" of a company? And why should that "value" be able to be sold and exchanged independently of the actual company which it is supposed to represent? Savings, fees, it's just the same word for money. Yes, investors are unable to use their money. But that is obviously not a bad thing, as people invest, and most people who invest have money remaining. Why can't they be given a "fixed-profit" return, and the workers given a "proportionate-profit" wage? The investors lends out his property, but the worker does all that is to be done. Infinity0 21:23, 18 November 2005 (UTC)

A share represents part of a company, and that part has a value, which is the price of the share. And why should you be able to sell a share? You are not obliged to sell it on a stock exchange; you can give it away if you like or sell it to friends. "Savings,fees, it's just money". Well, so is a wage. Also: the worker does not do all that is to be done. Nowadays most things can be made by robots and machines (i.e. capital). A company will decide on which to use (people or machines) depending on the cost of each. If workers become too expensive, then companies will use machines (that's what's happening in the Western world). If workers are cheaper, then the companies will use workers (i.e. in China, South East Asia,etc.). You are wrong to assume that labour produces all the value. See below my commentary on labour-theory of value. Luis rib 12:04, 19 November 2005 (UTC)

If you don't sell it, it's worth nothing... duh. Who made those robots and machines? Labour is the source of all man-made value. Infinity0 12:09, 19 November 2005 (UTC)

Just remember our NOR and NPOV policies. Most scholars characterize capitalist societies as class-stratified. How they define "class," what they consider the specific classes to be, and how they see classes as similar/different or related, is something scholars debate and we ought to represent all the major points of view, properly sourced. And if there are well-established scholars who claim that capitalism is not — or is no longer — class-stratified, well, that opinion should be included too ... properly sourced, of course. Slrubenstein | Talk 00:16, 13 November 2005 (UTC)

"Most scholars"? Certainly not most economists. Luis rib 19:46, 14 November 2005 (UTC)

Well, economists represent only a partial group of scholars studying capitalism; there is a great deal of scholarship by anthropologists, historians, and sociologists. Slrubenstein | Talk 19:49, 14 November 2005 (UTC)

However, capitalism is mostly an economic phenomenon. And, unfortunately, many non-economist scholars only have rudimentary knowledge of economics, which may bias and invalidate thier conclusions. Luis rib 19:55, 14 November 2005 (UTC)

No, capitalism is mostly a social phenomena. And, unfortunately, many non-sociologists and non-anthropologists have only a rudimentary knowledge of social phenomena, which may bias and invalidate their conclusions. Slrubenstein | ] 16:36, 15 November 2005 (UTC)

Why is capitalism mostly a social phenomenon? Capitalism concerns the structure of an economy - as opposed to other economic structures - and as such has an impact on a country's economy. The science analysing an economy is economics. Sure, there are social impacts as well, which may be analysed by sociology and anthropology. However, these sciences have to take into account in their analysis of capitalism the other possible structures of economics (for instance corporatism, communism) and compare the impacts of capitalism to the possible impacts of other economic systems. So, it may be easy for a sociologist to point out the problems of capitalism; yet rarely does a sociologist compare those problems with those created by other economic systems. Luis rib 19:56, 16 November 2005 (UTC)

Can you honestly say capitalism has only affected the world's economy? Wealth gaps are a direct cause of social inequality and division, and hence classes. Infinity0 22:17, 16 November 2005 (UTC)

And what is the cause of wealth gaps? Mostly biased laws, corrupted governments, bad economic policies. Capitalism can be a cause for good and for bad; it is not good or bad per se. Luis rib 19:30, 17 November 2005 (UTC)

Why do you say this? Capitalism by its very characteristic causes huge wealth gaps - lots of people working for the benefit of a few. Infinity0 19:50, 17 November 2005 (UTC)

Which "very characteristics"? I certainly disagree with that statement. A person always works for her own benefit: get money to buy goods. What is the problem if workers don't own the corporation they work for? You just assume that the shareholders just earn a lot of money on the back of the workers, yet that is not necessarily true...take General Motors: the share price is at its lowest for 12 years, which mean that shareholders have gained no money during 12 years! Yet workers at GM continued to get their wage during the last 12 years.Luis rib 19:37, 18 November 2005 (UTC)

Private ownership of the means of production concentrates it in a few individuals. A person gets a small part of what they should get - the company takes some. And you have not refuted that "the shareholders earn money off the backs of the workers" - you gave an example where the workers didn't produce anything to be taken from them, so how could they be exploited? Infinity0 20:13, 18 November 2005 (UTC)

Nope, private ownership of property allows you to own a house, for instance. Or a car. Or whatever else you want to buy. Some people put their money into real estate by building a house; other put their money into bonds or shares.

Also, the shareholders provide the money for the company to exist. A company cannot exist just with labour - it needs capital to build a factory and to buy machines. This money cannot really come from the workers, because they do not have enough money at the start. So it has to come from other people: the shareholders. The shareholders will only give their money to the corporation if they believe that this investment (which, remember, is actually their savings!) will yield a higher profit than other potential investments: buying/building a house (real estate) or give money to the government (buying bonds). If bonds or real estate were always better than shares, no-one would invest in shares and so no company could raise new capital and no new companies would be launched. Luis rib 20:48, 18 November 2005 (UTC)

Private ownership of the means of production is not the same thing as purchasing goods, like owning a house. Owning a house affects nobody. By employing people, you are taking on responsibility for their economic future. As Proudhon says, " Property is theft... property is freedom."

A company can quite easily start from very little money, gain profit, and grow that way. You do not need tons of investors. The bigger the company, the less outside capital it needs, or should need, as it has internal resources. Taking on projects which require outside capital is to give influence over the company to outside capitalists, and to be going out of your depth - and it also involves much more risk.

Using your logic, that "the shareholders will only give their money if they believe it is profitable" - well, why not give them a fixed-profit? Using your previous arguments, this is a lot less risky too, as they will get a profit no matter what, and so more people are likely to give the starting capital. This doesn't affect the company much - in fact less, as fixed-money only has to be paid to a few investors rather than all the workers. The workers get a proportionate-wage, and the system becomes fair. Infinity0 21:23, 18 November 2005 (UTC)

Owning a house doesn't affect no-one? Actually it does - you neighbours :-).

Actually it is very difficult for a company to grow just through internal growth. If it was easy, every company would do it. Internal growth is usually too slow to permit rapid expansion; also innovation is usually quity costly and may take years to yield a profit. So to grow and expand you usually do need external money - be it debt or equity. Some companies grow entirely though debt; others prefer to grow by issuing equity (i.e. shares).

For fixed-profit, see new section below. Luis rib 11:55, 19 November 2005 (UTC)

Exactly, that rapid expansion is unstable. Internal growth causes bankrupcy much less than debt. Of course investment should be allowed, but just that limits on potential profit be put onto it. Infinity0 12:09, 19 November 2005 (UTC)

Classes are a social concept, not an economic concept. Of course rightist economists will deny such concepts. Infinity0 22:31, 14 November 2005 (UTC)

Actually, I've never seen the concept of classes in my economics classes at university. It's, as you say, a sociological concept, not an economic one. This has nothing to do with "rightist" or "leftist", it's just a concept that is of no use to economists. This does not mean, however, that economists are not concerned with poverty, on the contrary! It's just that classes are not useful in that analysis. Luis rib 19:56, 16 November 2005 (UTC)

Yes, I agree, it's of no use to economics - it's purely a social driving force. But capitalism has shaped far more than the economies of countries. It's affected everything - including the social attitudes we see today. Economist don't recognise classes but that doesn't mean they don't exist, nor does it mean they don't affect the future. Infinity0 22:17, 16 November 2005 (UTC)

I'm still very sceptical about the concept of classes. I do believe that if you give everyone the same opportunities, people can escape their so-called class and become successful. The problem is that in some countries poor people do not have the same opportunities than rich people. Luis rib 19:37, 18 November 2005 (UTC)

Hmm... you seemed to have just answered your own point. Classes exist because people invariably do NOT start off with equal oppurtunities - we have this thing called "inheritance", amongst other factors. As long as inheritance exists, then even if you "reset" people's opportunities one day, eventually they will become unequal again as children are born into wealthy families. And it's not just between countries, it's within countries too. Infinity0 22:16, 18 November 2005 (UTC)

There's the "investor class" RJII 00:08, 16 November 2005 (UTC)

Yes, many people invest, but few people mainly invest - most of them do other things as the main source of their income, and so you can't really call them investors any more than you can call a landowner who does a little work a "worker". And I'm not entirely sure what the difference is between an "investor" and a capitalist. Or was that a point to Luis and not me? Infinity0 17:52, 16 November 2005 (UTC)

Luis, maybe we're dealing with different varieties of the English language here: by "directors" I mean people who are major shareholders and who are elected to the board of a company. In other words, directors' fees are a supplement to the normal proceeds of share-owning. I don't mean someone who is a middle manager, although such people will probably be shareholders and possibly even directors. A manager who is neither a shareholder nor a director (such as a manager in a private company) is a wage earner who is paid to think like a capitalist. Grant65] 00:46, 15 November 2005 (UTC)

I did understand your use of the word "director". Actually, directors may or may not be shareholders - they are just appointed by shareholders but are not necessarily shareholders themselves. The directors may or may not get a fee (depends on what the Articles of Incorporation of the company say); when they do get a fee it's because they bear the legal risk if the company screws up and does something illegal. Since no-one wants to take such a risk for free, it has to be compensated by a fee. Of course, one may argue about the amount of such fees, and if they are really necessary. Yet that's a decision that the shareholders have to take, since it's their money that the directors are playing with.

A manager is indeed just a worker, like any other; his wage is just a bit higher because again he takes more risks than the coworkers he leads. I'm not sure I understand what you mean by "thinking like a capitalist".

Actually, in many companies the main shareholders are investment or pension funds. These funds, again, are owned by thousands of small shareholders. So in the end the "bad capitalist" may be the granny next door. ;) Luis rib 19:56, 16 November 2005 (UTC)

That's true about the "granny.". Most retirees are capitalists in the purist Marxist sense of the word. They're earning money without laboring at all ..living off the interest and profits from invested capital. I wonder, would idle retirement be possible in Marxism or would granny have to labor until death? RJII 20:23, 16 November 2005 (UTC)

"From each according to his ability, to each according to his need" - I don't agree with this entirely, but it would answer your "granny in Marxism" paradox. And I thought retired people got a pension, not investing in stuff. I didn't think old people went for such a risky thing :P Infinity0 22:17, 16 November 2005 (UTC)

Old people don't invest any more. They invested when they were still young and reap the profits of their investments when they are old. Luis rib 19:30, 17 November 2005 (UTC)

I'm not disputing what directors do; what I'm saying is that their personal material interests are clearly different to those of wage earners. That is what "class" originally meant, not the vulgarised notions of ones neighbourhood, what kind of car one drives, what colour socks one wears, etc.

What I mean about non-proprietorial managers is that they are "capitalists" only by virtue of a paradox, i.e. they are actually wage earners (salary if you wish, there is no significant difference). However their job description requires them to act as total surrogates for the proprietors. Obviously a truck driver is a surrogate for the owners of the trucking company in terms of the acts that he/she performs. Many wage earners identify with their employers, whether it is a corporation or an individual. But managers spend a large proportion of their working time, possibly the majority of their time, thinking about other wage earners and how to make them work more productively. That is what I mean by "thinking like a capitalist". Grant65 | Talk 05:24, 17 November 2005 (UTC)

If trying to increase productivity is "thinking like a capitalist", then the world is clearly lacking capitalists. Increasing productivity is after all one of the major causes of economic growth; and without economic growth there is no elimination of poverty.

Again, you assume that managers don't do anything the whole day, except trying to make life for wage earners harder. I would say the contrary: wage earners just have to do their 40-hour-week job without caring to much about anything - yet managers have to take care if quality is right, if the clients' needs are well served, if the operational processes are efficient or not (if not, it will cost more, and the company will lose its customers to its cheaper competitors), if the future projects that the company has have potential or not,etc. Luis rib 19:30, 17 November 2005 (UTC)

I didn't say managers do nothing all day; they probably work as hard as anyone. What I said was that they spend a large proportion of their time trying to improved the productivity of other wage earners, as well as the other tasks you describe above. That makes managers the natural allies of the proprietorial class, rather than their fellow wage/salary earners. Grant65 | Talk 04:40, 18 November 2005 (UTC)

Again, what is so bad about the "proprietoral class"? The proprietoral class includes the granny that has invested part of her saving in an investment fund. It includes the Italian immigrant that opened a restaurant. It includes the guy that invested some new thing in his garage and created a start-up. Are these people worse than wage earners? Luis rib 19:37, 18 November 2005 (UTC)

You give examples where the owner is the same as the worker, or the person cannot work. The granny cannot work, the immigrant works what he owns. The proprietorial class are the people who own the means of work and employ others to work. Infinity0 20:13, 18 November 2005 (UTC)

Then the proprietorial class is very small, since only the very rich can live entirely of their properties. Luis rib 20:48, 18 November 2005 (UTC)

Yup, but it's unfortunate they have all the power. Infinity0 21:23, 18 November 2005 (UTC)

Now he gets it. Grant65 | Talk 21:30, 18 November 2005 (UTC)

Nope, they don't have all the power, since the big majority of shareholders are not those few very rich people. These rich people might control one or a handful of companies but they certainly don't control the whole economy. Such as statement is absolutely absurd.Luis rib 11:48, 19 November 2005 (UTC)

You're assuming that because the not-rich people outnumber the rich, they have more power. That's not true, because the rich people own more OF the company than those not-rich shareholders, who mostly aren't the proprietory class as they also do a lot of work. Infinity0 11:56, 19 November 2005 (UTC)

This seems to have degenerated into an argument about what editors think. Please remember NOR: it does not matter what any editor thinks. Many social scientists writing about capitalism have written about class. Therefore, class must be part of this article (it simply does not matter whether or how many economists talk about class, though of course any major economist who has talked about class should be mentioned in the article). It is the views of these scoial scientists that should be represented in the article -- not mine, not Luis rib's. Slrubenstein | ] 21:50, 21 November 2005 (UTC)

Response to Classes in Capitalism?

Dear person who wrote the Classes in Capitalism?, you said that that lots of workers own computers as "proof" that workers own capital (private property). I have several questions for you:

1. Do any workers own banks?
2. Do any workers own factories?
3. Do any workers own transportation systems?
4. Do any workers own telecommunication systems?

P.S. Many serfs during feudalism owned small plots of land.

Oh and one more thing. This worker who owned stocks. What percentage of the company did he own? And was he a worker or a foreman?

Leon Trotsky 5:58 PM November 17, 2005

--- My answer (btw. my name is Felix. I forgot to mention.): Those who own banks today are not "workers" today. But they might have been before. (I don't know) I am sure that their parents or grandparents have been. This is even more true for factories, transportation systems and telecommunication systems. Besides, many of these are publicly traded and you can buy your part of them if you like. What I wanted to say was that there is no structural barrier, no law that forbids one man to get rich and provides goods to the other, in free capitalism. Warren Buffett started out as a paper boy. Nobody stops you from starting a company. You can make as much money as you wish. What about Google? Microsoft? McDonalds? KFC? What about J.K. Rowling? She was an unemployed ex-teacher when writing Harry Potter and now she is richer than the Queen. And it is only in capitalism where this sort of change is possible within your lifetime. One thing about owning transportation systems: What do you do when you just bought (or inherited from your rich ancestors for the sake of the argument) a railway system and someone (a 'worker' perhaps) starts an airline. Then that 'worker' becomes a 'capitalist' and the 'capitalist' becomes a 'worker' in your arbitrary definition game. The problem is that this just means that some people have more money than others. It doesn't mean that you can define 'classes' of people where people are stuck and can't come out. And there is also no exploitation. You can change jobs, you can start your own company, you can work as a doctor or lawyer or plastic surgeon and live from your own work without a capitalist or a worker. Of course, this is also only possible in capitalism.

The worker I knew was at the lowest point in the food chain of that company. I know it because I worked with him. I don't know the percentage but it was enough to retire. You only need .1% to be a millionaire several times over. That's because Microsoft is a very rich company. Felix.

So Felix, you are trying to argue that capitalism gives equal opportunity? How narrow-sighted you are! Try telling people who live in Compton, Ethiopia, Haiti, all sweatshop workers and all starving people, that capitalism gives equal oppurtunity! The rich have always had more opportunities than the poor, and this isn't helped by inheritance rights. For no reason other than accident of birth, you get a better opportunity than someone else. As anyone foo' knows, you start off with more money (eg given to you by your parents), you get a better opportunity. And sweatshop workers in Haiti CERTAINLY can't "change jobs... start own company... work as a doctor or lawyer ..." Infinity0 16:52, 25 November 2005 (UTC)

Well, actually the people in Ethiopia and Haiti and all the starving people have horrible living conditions precisely because they do NOT live in capitalism. Read Hernando de Soto's brilliant book 'The Mystery of Capital' on that. I really mean that. It's brilliant. It helped me resolve this issue. They don't have enforcable property rights in these countries. And without these there is no usable capital and therefore no capitalism. The problem is not an unequal distribution of the products of capitalism but an unequal distribution of capitalism. If all poor countries on this planet would vanish suddenly, our standard of living in the rich countries would not change dramatically. If one man builds a house it is his. Is it his fault that others don't have one? No it's not. One man being rich doesn't mean that another man has to be poor. Humans survive by production, not by theft. And Capitalism is the only system that acknowledges this fact. If you earn money, it is rightfully yours. You have earned it. You have worked for it. Therefore it is yours. It doesn't belong to some king or count, it doesn't belong to your country or your fellow man, not even a single part of it. It is yours completely. That's the only thing that is ensured in capitalism. If you work you get to keep the money you earn. Yes, it is true that if you own a company or stocks, it is possible to make money by employing other people to do most of the work. But you still need to have the money, and where did that come from if not from working and saving? And then, still, you can lose your money. Take Enron for example. And the only way to really make more money with the money you already have is to spend it on the tools of other people. Nothing else is owning a company. You own the tools and have the responsibility. Then you hire people to do the work. That, too, is work. But it is also done for you if you just buy stocks. But these CEO are fucking expensive. Yet, they are hired. You can't just hire people in America for a cent an hour. Why? Nobody would do it. Because there is competition between employers for the best work force. Why let someone work for your competition when he can work for you? A CEO is an employee, not an employer. Why doesn't he earn minimum wage, then? Because this is a key position and the competition among companies for the best people is fierce.

Before the advent of capitalism, we in the west were as poor as today's third world countries. At the beginning, children had to work under horrible conditions just to make ends meet for their families. Today, the average 'poor american' owns a TV while people in Africa still suffer hunger. Yes, this is horrible. I can only agree. But the solution is not to steal the TV, but to allow Africa to earn its food. All the wealth we have on earth has to be created and we'd see a real boost in the world economy if todays totalitarian regimes would vanish and be replaced by a country where the basic human right to your own life would be appreciated. Yes, it is right that you have more opportunities if you are rich. And if you are born as Paris Hilton, you have made it without breaking a sweat. But to deny people the right to become and be rich doesn't help anyone. Why can't a parent give all he has to his children? It's rightfully his. He can do with it as he pleases. The fact that there is someone out there who had less luck than you did doesn't give him the right to your money. What do you do with lottery winners, then? That you get rich merely by luck is just as rare as winning the lottery. Wealth, before it can be inherited (or unevenly distributed to the lottery winner), has to be earned. Therefore one man's wealth is not another man's misery.

What system do Brazil, China, Haiti and Ethopia use then? Brazil is certainly capitalist, yet has incredibly horrific ghettos. And what about the US? You seem to ignore the reality. There are many shitholes in the US too. People who are born in those areas do NOT have equal opportunity as everyone else.

If you earn money, it is rightfully yours. You have earned it. You have worked for it. Therefore it is yours. - no shit sherlock? But what about the bastard rich companies who pay sweatshop workers 37c a day for hard work? The workers have to put up with much worse crap than a CEO, and yet the CEO gets more. The whole point is that capitalism does NOT give you what is rightfully yours. When you work for a company you help it make profit. How much is that profit? Variable. But the company only gives you a fixed wage. It may be raised, but only at the whim of the boss, who wants to maximise his profits. In effect, the company steals from you. You do not own (a justified part of) the company, and the end-result of your work becomes the COMPANY's property, who then use it to obtain more profit. That profit is rightfully yours, because you worked for it. However, the company takes it. So you DO NOT get what is rightfully yours.

At the beginning ], children had to work under horrible conditions just to make ends meet for their families. - It saddens me to see that you believe this bullshit. In the 1800s, children worked. In reality, Europe in the 1800s was more capitalist than today. Workers rights', like the minimum wage, and the 8-hour day were won by trade unions and left-wing activists, not capitalists. Before capitalism, there was no child labour, or much much less. It is only democracy which has kept capitalism in check.

Why can't a parent give all he has to his children? It's rightfully his. - why is it "rightfully" the child's? It isn't, the parent is giving it to them only because of accident of birth. That is UNequal opportunity. Wealth, before it can be inherited, has to be earned. - who does the earning? CERTAINLY not the inheritor.

Okay, let's do this more slowly. In the 1800s there was less wealth available. People just didn't have much in general. The pie to be divided was much smaller. Yes, there were some who had more than others. Even way more than others. Same as today. Same as always. But unequal distribution of wealth doesn't exist because of unequal distribution of rights. That's my point. A class structure would mean that some people have more rights than others, by corruption or before capitalism also by birth and by law. And this is the case in the poor countries you have mentioned, which is why they are not capitalist countries. Capitalism means equality in rights. And that's what they don't have. The reason you can't start a company in these countries when you are poor is because it takes 10 years of buerocracy(no kidding, de Soto tested this) and about five times the average yearly income just to legally open a little street store in Haiti. Same with the other countries.

And when you can't do that, you have no choice but get a job somewhere. But it gets even worse. Because these people have no legal title to their property, they can't use it as a collateral for credit. Besides, in unstable countries where property rights are hardly enforced and corruption rules, no outside investor is likely to invest.

This naturally (well, rather unnaturally) leads to a lack of entrepreneurs and therefore to a better position for the companies already in existence. Yes, this is exploitation. I can only agree. But the solution is not to end capitalism, but to start it. That's not capitalism. If the rich have more *rights* than the poor, that's the beginning of injustice. The rich can use their money to expand their power because they can buy their way through law. That's what's wrong and here, I think, we are on the same side. But my argument here is that this is not capitalism. Capitalism doesn't mean that there are companies where some people work and others profit. You have the same in every socialist country. It means that everybody has the legal right to his property and then can start his own company to make those at the top right now live in fear. Saunders (the KFC guy) started out with a small retirement check and an chicken recipe. He was lucky that he lived in America, because had he lived in Haiti, he would have worked his ass off in a government-protected factory for 37 cents. That's the difference between capitalism and a class system.

About equal opportunity. There is none. Never was. Even if you redistribute all the money in the world evenly among people, about five years later, you'll find the same distribution. With other people at the top maybe, but still it is unequal. Why? Because people are different. They are not equal. Some work more. Some have better ideas. Some prefer enjoying their lives. Some are workaholics. Some lust for money. Others don't.

You will never be able to make all people the same. Simply because this is not a good thing. All you need is a good idea, the persistence to realize it and the right to do it. That's all. The money you have is a minor factor.

Next time, please spread out your paragraphs (press ENTER twice). I need to put you straight. Equal rights is not caused by capitalism. Capitalism is an economic system. Democracy (equal rights) is a political system. The two don't even complement each other - in fact, the owners of the big companies would like nothing more than for you to be forced to buy their shit.

So what if people had "less wealth" in the 1800s (whatever that means)? What relevance does that have to any of the points I made? Also, when did ownership of property come into this?? If you are trying to argue against communism, then Karl Marx said nothing about personal (non-capitalist) property. To quote the Communist Manifesto, "Hard-won, self-acquired property! ... There is no need to abolish that: the development of industry has to a great extent already destroyed it..." Abolishing property means abolishing capitalist property, ie. the means of production, which is used to exploit workers. For a more detailed definition and explanation of the differences, see Property is theft! (not by Marx, but by Proudhon. But nevertheless, I did not mention anything about abolishing property, you pulled that one out of thin air.

About your so-called "government protected" factories in Haiti. Who do you think pays the government to "protect" the factories? The OWNERS of those factories, ie the big companies.

Who said anything about making people the same? People are always going to be unequal but capitalism is taking the piss. The richest person owns about 1 trillion times more than the poorest person in the world. You are the one who has been going on and on about how "capitalism gives you what you deserve." Well, does ANYBODY deserve 1 trillion times more than another person??

It looks like your spewing the usual flawed, anti-communist arguments. Why? I'm not even a communist, and have not even made any communist points! Please actually read what I write in detail, without making assumptions. You haven't shown any sign that you've actually read my points about exploitation or inheritance. What do you think? Are they right, or not? Infinity0 12:17, 3 December 2005 (UTC)

Ok. Let's start with inheritance. Yes, if you inherit something, then you haven't earned the money. Someone else has. And he, who owns the money, decides to give it to you. He could also decide to give it to charity or someone else, but he didn't. What's the problem here? It's not your money they distribute, it's theirs. They can do with it as they please.

Just out of curiosity, what should they do?

Alright, now exploitation. I already agreed with you that the rich government protected company owners exploit the workers of Haiti. What else do you want to hear? But they can only exploit them because these people are not given basic rights. If they were, there would be no exploitation.

I brought up the capitalist/communist-issue because as far as I see it, capitalism means just that: Granting everyone basic rights to property and freedom and leaving these people alone, then. Our current system, then, is not capitalism as I see it, but socialism to a great extent, where it is possible to make money by force legally. Like agriculture subsidies for example. Europe pays enough for this to pay a flight around the world for every single cow in Europe. All this with stolen money. This is clearly wrong. But calling this capitalism means attacking the wrong side.

I think we just have different definitions of capitalism. Please name yours. Maybe we can get rid of some of the confusion that way.

It's not your money they distribute, it's theirs. They can do with it as they please. - so, it's not equal opportunity, because equal opportunity means equal starting points. People who die should have their extra assets donated to the public.

But they can only exploit them because these people are not given basic rights. If they were, there would be no exploitation. - what do you think trade-unions and left-wing activists are trying to do? Get worker rights. The eight hour day was won by left-wingers, not right-wingers. If it was up the the owners of the companies, they'd pay their workers the minimum possible. And the big companies can buy power (ie buy the workers' rights away), because they have so much money.

Our current system, then, is not capitalism as I see it, but socialism to a great extent, where it is possible to make money by force legally. - that's not socialism OR communism. Where do you get these twisted definitions from? Please understand that communism is not about taking away your personal property. And if you meant "well it can happen in socialism", it happens in capitalism too, and even more heavily, because a few people have much more money than the rest (ie. large wealth gap). Also, that wasn't what I meant by exploitation. Capitalist exploitation is intrinsic to the employment of wage labour; if you want me to explain I'll do so, but Marx pretty much covers it all. Infinity0 ( talk | contribs ) 23:08, 4 December 2005 (UTC)

Again. If you are not allowed to decide what should happen to your belongings after you're dead, what exactly should be done with it? Explain this further. You said that extra assets should be distributed among the public. What are extra assets and who decides this. You? And who is the public? Are families to move out of their houses to move to an appartment? Who gets the cars? What about the playstation? How much wealth do you allow people to have? And why?

Yes, there is no equality of opportunity. I already said that three times. There is equality of rights. There's a difference.

You can't force companies into higher production. It doesn't work. If you had sent today's politicians to the beginning of the 1900's, do you really think they would have been able to raise the general standard of living? With what? Redistribution never creates additional wealth. They could have stolen some money from the rich and given it to some poor people, yes. But they would never have been able to raise the general standard of living. It was low back then. That's not capitalism's fault.

I think here we have opposing views. You think that forcing companies to share is the way to go. I don't. That's because you believe it is exploitation and I don't, I suppose.

I read parts of Das Kapital, but I think that the theory of exploitation in capitalism is false. So, yes, please explain this to me again. Thanks.

As to the rich buying extra rights, yes, that one is wrong. (Something else I already said three times.) It is corruption and it is a crime. You see this as the definition of capitalism, I suppose: The rich do whatever the fuck they want. You never stated it explicitly, so I just have to assume. But that is not the definition any liberal thinker has clung to. And it is not my definition. Corruption is a crime because it is against the principles of capitalism. It's not part of it.

On the socialism/capitalism-thing: We live in a mixed economy today. One part is capitalism, the other is socialism. We have some of both. That's what a mixed economy means.

If the means of production are not privately owned, who owns them? Now don't say the public. Who is the public? Who decides what should be produced? Who maintains the means of production. What happens when something that is produced is not wanted anymore? Who would fire the workers, then? I really don't know how an economy is supposed to work without privately owned companies. Please explain this to me.

When you die, all your property which is not in use or needed by anyone else is given up for public use. Simple as that.

• There is nothing in capitalism which says everyone has equal rights. Equal rights is not intrisic to capitalism. Example: slave trade, apartheid, etc, etc.
• No, I never said forcing companies/people to share is the way to go. Stop inventing crap.

Worker exploitation in one paragraph, here it goes: A company owner pays a worker a fixed wage for a commodity/service which increases a company's profit (otherwise they wouldn't employ them). The end-product of the worker's labour is taken from him and becomes the company's property, not the worker's, the company then uses it to obtain more profit, which is rightfully the worker's as he has done all the work towards creating that commodity/service. In short, this exploitation arises from the fact that the worker does not own the means of production, and anything he produces is taken away from him (albeit in exchange for a fixed, arbitrary wage). Infinity0 18:02, 6 December 2005 (UTC)

What exactly do you mean by not needed? Who says what is needed and what isn't? What about the family's house? Who decides if the family needs that house?

Capitalism has one single basic premise: Equal rights for everyone. Everything else is not capitalism. There may be companies and workers, but that's not capitalism. Period.

You said that companies have no right to their profits. This implies that they have to give away their money, right? If you don't say what you mean, I have to make assumptions.

My problems with exploitation theory in one paragraph: The company owners own the tools for production. They cost money. They then have these tools used by their workers. These tools are the reason for the high production of the worker, sometimes boosting it up to a hundredfold. How else can one pay higher wages for less work? The worker's labor is not the only source of the value creation. Without the tools, no work could be done effectively. The notion that those with money just make more money is also false. Most of the time, the company owner doesn't even have the money himself but has to borrow it to then pay it back with interest. And in most of the cases, they can't do this in the first year already and end up bankrupt (90% of the cases, to be exact) and the money borrowed is lost. The funny thing is that a big chunk of that money landed in the worker's pockets who then go to work for another employer. In one sentence: If I buy tools (and providing everything for a good job (engineering, etc.) cost about 100.000$ each currently), and then pay all income to the workers, why in the world should I do that in the first place? Then, you can only make money with other people's labor if that labor is geared to a useful purpose, that is: the creation of a value someone is willing to pay more money for than you paid for tools and labor for production (and marketing, legal issues, etc.). This doesn't have to be the case. Actually, most products fail in the market place (again it's over 90%). Getting a good company started is a great achievement.

Something else: What is the alternative you offer to capitalism and how does it differ from socialism?

Who says what is needed and what isn't? - If it's in constant use or not.

Capitalism has one single basic premise: Equal rights for everyone. - OH RLY? I think somebody has their definitions very very mixed up. What the hell do you think CAPITAL is??? And if capitalism is "equal rights", then what is DEMOCRACY? Everything else is not capitalism. - OK, so you're saying free market, private MOP, is not capitalism? BTW, if nobody has private property (communism), that's still equal rights. Capisce?

This implies that they have to give away their money, right? - Yup, for justice, the company should give the profits to its workers instead of its investors. The solution is basically to make it so that companies do have a right to their profits. And the easiest way to do that is for workers to own the company.

These tools are the reason for the high production of the worker - And how did you get the tools? Who built the tools in the first place? Why should you retain the profit from the tools even though somebody else uses them? The worker still produces things without the tools (although less), but tools by themselves can't produce jack. The worker uses the tools to boost his productivity, so he should get a proportion of the profits, but instead capitalists give him a fixed-wage - ie. stealing his profit.

Alternative to capitalism: read below sections on "company ownership" and "LTOV", which is about 5000 words I guess. Have fun! :) Infinity0 21:21, 6 December 2005 (UTC)

80.184.141.21 13:03, 7 December 2005 (UTC) Sigh! The term equal rights consists of two parts. One is equal, the other is rights. In communism you don't have property rights, that's what rights means here. Equal refers to the rights, the property rights that is. Everyone has the same rights to his property. That doesn't mean that everyone should have equal property nor does it mean that if nobody has rights, that this is a good thing because a lack of rights is equally distributed.

Oh, and here's a link to a page about the principles of liberal thought:

Try it!

Now who's mistaken about the intellectual premises of capitalism? If all you know is Marx, you have no idea. Actually it's worse: You have a wrong idea. I hope this helped.

If I own a 24 million dollar house and my familiy uses it and I die, may they keep it? Please, finally define your terms.

The other workers were paid for the tools. The tools weren't stolen. They were bought. That's the part of the capital owner in the production process. Buying the tools. With his money or money he borrowed. The only reason for a wage increase is increased use of capital. You can only work a given amount of time every year. The productivity of that time is given by the tools you use. Any increase in productivity is due to capital increase or by implementing an idea that allows you to create more with the same capital. This, by the way, is the job of the capitalist. The workers already worked to their maximum in 1900 didn't they? They even worked harder and longer. How can people today work less and still not die of starvation? By increased use of capital and brain power.

This seems to take longer than I thought. I think I'll get an account.

Wait, I have a better idea. I created a blog so we don't abuse wikipedia for chatting.

Here you go.

That first link is about liberalism, not capitalism. There's a concept called libertarian communism too. In communism the concept of property is invalidated (for everyone). There is no such thing as "property". That's still "equal". Capitalism says nothing about rights, tbh. It's an economic systems, not a social system.

About the house, read above point about "in use". IMO the 24-million house should never have been built in the first place, but whatever.

The other workers were paid for the tools. The tools weren't stolen. They were bought. - and where did the capitalist get this money from? , by the way, is the job of the capitalist. - lol "job". The capitalist DOES NOTHING to earn the profit. At most, he deserves a fixed-profit from the worker. IE, the worker hires the tools from the capitalist, not the capitalist hires the worker to run the tools.

How can people today work less and still not die of starvation? By increased use of capital and brain power. - no, by worker rights. If there were no worker rights then companies could make people work more. Many big companies oppose trade unionisation, because it threatens their hold on the workers. K-Mart, for example, fired employees who formed a trade union.

Meh, wikipedia is better (much more space), we could move this to your talk page or something. Infinity0 18:40, 7 December 2005 (UTC)

Liberalism is the philosophical basis of laissez-faire capitalism. Don't be disrespectful just because you disagree.

Yes, that's a good question. Where do capitalists get their first money from? According to your theory capitalists do nothing to make money and never did. The money they have must have magically appeared just like the factories they own for this to be the case. Please stay reasonable.

I already explained what an amount of work it is to build a successful company, but you don't listen.

You also offer no arguments. All you do is rant and rave and insult me. And even after repeated tries on my part to make you understand the difference between laissez-faire capitalism and todays system, you have failed to understand. No wonder you don't learn if you insult everyone who disagrees with you.

I talk about laissez-faire capitalism. Nothing else. I already agreed that todays system sucks.

Please explain to me how worker rights increase production. The only thing that can increase production is longer working hours or a more efficient work structure or better tools. Also explain what would happen to the family house which is to be inherited.

Another argument you offer is that workers should be paid according to the profits. This variable compensation would lead to workers not being paid at all if management fails or worse, workers would have to pay AND work. A fixed wage is a convenience thing, nothing else.

I don't think that wikipedia is a chatroom. We should really move this to another place.

Felix1981 19:18, 7 December 2005 (UTC)

If you were talking about laissez-faire capitalism, then go complain there. This article is for normal capitalism. But 18th century capitalism was much more laissez-faire than today's, and we all know what happened with imperialism, slave trade, British India, Opium Wars, colonisation, all direct results of free capitalism. So much for your "human rights" argument.

Who said anything about building a company? Most companies when they start off, do not employ wage-labour - the workers are the ones who own capital. I was talking about wage-labour. What did you think I was talking about??

Please explain to me how worker rights increase production. - never said anything like this. Read what I wrote. Worker rights is the thing which improves worker conditions, not increased capital.

I see a total of 1,2,3,4,5,6 counter-arguments in this reply, and about the same in the previous one. Read them.

This variable compensation would lead to workers not being paid at all if management fails or worse, workers would have to pay AND work. - what do workers pay? And if they fail, yup, it's their fault. Managers are workers too. What about the unfairness to investors in normal wage-labour? Whatever argument you can supply to defend "investor risk", I can mount the same or similar argument to defend "worker risk". Infinity0 19:38, 7 December 2005 (UTC)

Hm. I doubt that todays system can correctly be called capitalism. It's more like anarchism given the lack of equal rules for everyone. It's all about force, gaining political power either by a lot of votes or a lot of money. This has nothing to do with laissez-faire capitalism, where this (political power) is strictly forbidden.

You can only increase worker conditions if productivity has risen. That's what increased worker conditions. Not union force - productivity. The standard of living only increases if what you buy becomes cheaper or if you get more money. Your way would be to force a bit more money out of the current companies. My way is to make everything cheaper by using more and better tools which is way superior. You would never get todays standard of living by enforcing workers rights. You only get it by increased capital and improved capital use.

And that's, to repeat it, the capitalist's job. He has to invest his money where it yields the most dividends. And that is always the most innovative company. If you invested in Microsoft early you would have made a lot of money, even if you started out with little like my former co-worker. It's not what you have, it's what you do with it.

Well, not all companies make profits, especially not all the time. The guy who gets the profits also has to handle the risk of loss, whether it's the capitalist or the worker. And if it's the worker, as in your example, then if the company loses money he will have to pay the fixed fee for capital out of his own pocket. Something like this system already exists. It's called starting a company with borrowed money. Here you have to pay a fixed borrowing fee for the capital (interest) and you are in charge of what happens. And if you ruin it, a big chunk of the pain goes to the investors.

Worker risk? Now what's that? All that can happen is that he can lose his job and get another one. He can't lose his money, can he? He works, he gets paid. No risk. And if he loses his job, bad luck. He can find another one. Nodody cries when a company goes down when its services are no longer wanted for the same reason. Nobody should pay for something that's not wanted. Felix1981 10:13, 8 December 2005 (UTC)

Well, how is it anarchism when we have governments? And in your model of "pure capitalism" where "political power is forbidden", that sounds a lot like anarchism to me? Have you gotten definitions mixed up? Or am I not understanding you correctly?

Increased productivity increases the capitalists' conditions, not worker conditions, since all profits GO TO the capitalist. You are trying to justify trickle-down economics, which evidently do not work (eg, ghettos, slums, countries in famine, poverty gap is larger than ever, etc). Justifying trickle-down economics is the same as justifying communism - you assume everyone is kind to each other.

And that's, to repeat it, the capitalist's job. - no, it's not a job. He does ONE thing - ie, lend out his money. Then he sits back. He doesn't DO anything. (If he does (eg. manager), he's a worker too.)

In my scenario the workers own the company, so they carry the burden of risk if something goes wrong (ie. worker risk, not investor risk). I wasn't talking about normal wage-labourers. And if you ruin it, a big chunk of the pain goes to the investors. - why should the pain go to the investors? They certainly aren't the ones who caused the ruin! My justice works both ways - both investors AND workers get what they deserve, fixed- and proportionate-profits respectively. Infinity0 17:51, 8 December 2005 (UTC)

Anarchism means that there is no government at all, that means that there are no enforced general rules, that means no basic rights. Political power means the right to violate fundamental rights "for the higher good". That's forbidden in laissez-faire.

Yes, all profits go to the capitalist by definition. That, however, doesn't mean that all the additional benefits of innovation result solely in profits. These are often used to allow the company to grow. This usually means that the company raises its wages to attract more workers.

If a company benefits from hiring a worker, it will offer a job. If nobody responds to the offer, the only way to find someone is to raise the wage. If the entire work force is already employed, then how else do you attract other workers? You can only do this by offering improved conditions. In laissez-faire capitalism work is always scarce. Everyone is working somewhere, either as an entrepreneur, an investor (see my explaination below), or he's hired. And they already picked the best payment and working conditions they could find. You have to offer them an incentive to switch jobs. Otherwise they won't do it because they have no reason to.

If the workers ruin it, then the investor's capital is lost, at least to a very high percentage. Who pays it back to him. He only gets his interest if everything goes right, but if something fails, his money is gone. What your system does, if I understood it correctly, is to forbid hiring people, so that everyone has to be an entrepreneur of some sort. That means that you can't just work your job and get a fixed payment. Instead your wage depends upon which company you work for and if it yields profits. If it doesn't, all your work is in vain, even if you worked all year you end up with no money, maybe even in debt, even though you just worked at an assembly line. This doesn't sound very good to me. Capitalism allows both. You are not forced to be an entrepreneur. You can live quite well with wage labor. But if you want to be an entrepreneur (or feel you are being exploited), nothing can stop you. So in laissez-faire capitalism, you have both opportunities of which one allows you to just sell your labor and have no risk, which is a fine thing for most people who usually prefer to play it safe. If you want to be an entrepreneur and receive the full money but also accept all the risk, do so. Nobody stops you. Wage labor is not enforced in laissez-faire, because you always have the opportunity to borrow capital and start a company. I don't see how your system is an improvement. It limits choices. But maybe I understood it in a wrong way. If so, please explain it in more detail.

The capitalist's job is to pick the right companies to invest in, that means that he decides if the idea of an entrepreneur is worth it. If he thinks so, he gives money and if he's wrong he loses it. If it works out, yes, then he's a happy guy. But that's the only reason he borrows his capital in the first place. If this wasn't the case he would just spend it. Intelligent investments don't happen automatically. And given most companies fail, this is not an easy job. Especially if you don't work in that field (let's say cancer medicine) but should decide if it is worth putting your money into it. If you don't believe me, then try to make money in the stock market. There you are the investor. You can even try it without risk in these online games that allow you to play the stock market in real time with fake money. Good luck.

Okay, so the distinction is now clear: You agree that the CEO is a worker. Why do they get paid so much? What do you think?

Felix1981 13:31, 9 December 2005 (UTC)

is forbidden in laissez-faire. - Surely that's NOT laissez-faire? Any sort of "forbid" is regulation, which is by definition NOT "let do, let pass".

are often used to allow the company to grow. - nothing about worker rights. As I said, justifying trickle-down economics is the same as justifying communism. If you think capitalists will improve worker conditions out of the goodness of their hearts, that's like justifying communism. If you think capitalists will improve worker conditions to maximise THEIR profits, that's ALSO wrong. The easiest way to maximise self-profit is to find that magical line where you treat workers as CRAP as possible without them uprising. Which is what happened in the 18th century. Laissez-faire capitalism - it favours assholes who use harmful methods to obtain profit.

What your system does, if I understood it correctly, is to forbid hiring people, - NO, actually physically read my words. I explain it very clearly in the below two sections, #Fixed_profits_for_investors and #Labour_theory_of_value. You're making up counter-arguments which have no relevance to what is suggested, much like your above arguments against communism. For example:

If the workers ruin it, then the investor's capital is lost, at least to a very high percentage. - exactly, why? The investor hasn't done anything to deserve this loss (nor has he done anything to deserve a proportionate profit). Instead your wage depends upon which company you work for and if it yields profits. If it doesn't, all your work is in vain, - nope, instead, you ARE the company. If the company fails then it is more than very likely that you did NOT work.

Most companies fail - really? Got any sources? Because it's quite plain to me most companies do NOT fail, given the wealth of capitalist countries. CEOs get paid so much because they own much of the company. They pay themselves. DUH. Infinity0 16:59, 9 December 2005 (UTC)

Laissez-faire is not anarchy. It is defined as a system where everyone has the basic rights to his life and property as well as the right to enter enforcable contracts. Ensuring this is the government's job. It does this and nothing else. Anarchy is where there is no government.

Please use arguments. 'Capitalists are assholes' isn't one. Please explain to me how you want to attract new workers when your working conditions are as crappy as your competitor's. They are not forced to stay with their current employer, but why should they switch jobs if there is no reason to? You just said 'Wahwah, capitalists are assholes and exploiters and history shows wahwah'. Please answer my question. And if you have no arguments, then at least consider mine and don't fall back into taking 'Some own everything and exploit everyone' for granted. It's wrong. I'm really trying here. Please listen.

My argument was that what you proclaimed was nothing new. It's already in use. In addition to wage labor. Why don't arguments have relevance?

Why does the invested money go down the drain? Because it is invested in labor and material that resulted in products nobody is willing to pay money for. So you had good money and traded it for crap. The workers screwed it up. They get no profits. But you -as the investor- have lost most of your money. It's not that you just don't get your interest. Your invested money is wasted. And a part of it went to the workers to feed them while they were working.

Work doesn't automatically transfer into money. That's the mistake in labor theory. In some way work is even insignificant. Now what do I mean by that? Of course to produce anything of value you have to do some sort of work. That's clear. But not all work ends up in something that people want. Especially in a competitive market place. You don't have to create something of value. You have to create something of better value than your competitor or the same for a lower price. Otherwise you don't make money and all your work is lost no matter how much capital or work you used. If the result is not sufficient, your company goes down.

This is something that happens very often. That 9 out of 10 startups fail is common business knowledge. It's expected. In fact you learn it right in the beginning of every MBA program. Here are just some sites I found during a quick search:

US Small Business Agency Harvard Business School Entrepreneur.com - Advice to better buy an already existent company instead of starting one

Starting a business is risky. But it pays off well if it works. And even investing in already existent companies is risky. Just try one of these online investment fake money accounts. It's very easy to lose your money. There's a reason most people prefer wage labor.

Felix1981 12:26, 12 December 2005 (UTC)

Please quote exactly where I say "all capitalists are assholes" or even any "capitalist is an asshole". Also, if you are going to instruct me to "answer your question", then actually state what the question is, and how I have not already answered it in my last reply.

Laissez faire is defined as a system where everyone has the basic rights to his life and property as well as the right to enter enforcable contracts. - please read the article on laissez faire. It's an economic theory, not a social theory. Everyone has equal rights to life in communism. And Marx never actually says personal property should be banned, just capitalist property (MOP used for wage labour). It's generally thought that the whole concept of property is invalidated - not property taken away from you. "Basic rights" is not a unique characteristic of capitalism. You are trying to force through the same invalid points post after post. Get it into your head, capitalism is an economic theory, not a social theory.

Your invested money is wasted. And a part of it went to the workers to feed them while they were working. - and WHY should that happen? The investor has done nothing to deserve this loss (or gain)!!! I have been making this point for the past 3-4 posts, and you have not answered it.

Work doesn't automatically transfer into money. - when did I bring anything like this up? Work creates value, not capital.

Yup, starting a business is risky. That contradicts your point, don't you think? Because there are already competitors on the market who are a lot more experienced and therefore better than you, you don't have "equal opportunity", as it were. However, as for the point about investors having "risk" of loss; that still doesn't excuse the fact that they don't deserve a proportionate part of the profits, as they have *done* nothing proportionate. Infinity0 00:00, 13 December 2005 (UTC)

"Laissez-faire capitalism - it favours assholes who use harmful methods to obtain profit." What else does this answer show except that you didn't answer my question?

My question has been: "Please explain to me how you want to attract new workers when your working conditions are as crappy as your competitor's. They are not forced to stay with their current employer, but why should they switch jobs if there is no reason to?" Please answer it.

Laissez-faire is the economic theory that finds its philosophical basis in liberalism. It doesn't work with any other social theory because there basic rights are not ensured.

About the investor losing money: Your ideal model is already part of your current economy. It is called: buying bonds. A company(in your model this would be a company owned by the workers) issues bonds which investors can buy. This is in effect nothing but a contract that the investors get their money back after a defined amount of time with interest. If the company goes bankrupt during this time, the money is lost. This is bad for the investor. But this doesn't change the facts. If you invest your money in stuff that doesn't have value, then you lose your money. In fact that's fair. Why should you make more money when you spend all of it on wasting resources?

If I got anything of this wrong, as you suggest, please explain to me exactly how it is supposed to work differently. So, next question: "What exactly happens to the money the investor gives a company (what is it spent on) and how does he get his money back if the company goes bankrupt?"

Work creates value? Not always. Sometimes work destroys value. However, every value that is, is created by work. Now what is value? How do you determine if something has real value? Especially a product. When does it have value? When people are willing to spend money for it. Money is used to evaluate products and to compare their value. The amount of money someone is willing to spend for a product determines its value to that person. Without any way of measuring it, value is a meaningless term. Something has value if people are willing to give their hard-earned money to acquire it. That's an obvious proof of value. And the more people are willing to spend on it, obviously, the more they value it. That value is called price. The cool thing here is that your product doesn't have to be of value to everyone. It just has to be of value to enough people so you can sell enough of your product. So if you are a capitalist and you try to sell poorer products at a higher price, nobody will buy them and you will lose your money and deserve it.

Now if you have worked all year and have a huge container filled with the oh-so-brilliant product you have created (and it definitely has high emotional value to you) and you try to sell it. Then you realize, nobody wants it. Especially not at the price you want to sell it for, not even at the price you paid to produce it. Then you come along and curse the world because you are not paid for your work and all the 'value' you have created. And you miss the point that you have created no value, but have destroyed it and get punished accordingly. Had you created a great product many people want, then you could have made a bunch of money. But you haven't. Bad luck. All the money you have won't help you here. (That is also why stock prices go down and big companies die out when their services are no longer needed.)

There is no equality of opportunity. And there never will be. If you redistribute all the money on the planet so that everyone has exactly the same amount of it and then wait ten years, you will find that 99% of the rich people will be rich again and 99% of the poor people will be poor again. The difference is skill. Understanding what people want and producing exactly that for a good price. The equality is in the rights. The right to give it a try. To find out how valuable you are to other people.

What my examples prove is that work doesn't always create value. If it did, more startups would flourish. And combined with the fact that startups work harder than anyone else in the market to make it, clearly shows how wrong it is to assume that value is correlated to the work that is put into it. This is only the case if that work is properly used. And this proper usage is more important than the work itself, because without it, all work would be worthless. And this part of the equation is completely neglected in the labor theory which still claims that the work itself is all-important. Work that truly counts is entrepreneurial work. Because only if this is done right, other work has value. And that's why a manager deserves more money than an assemly line worker. His work is more valuable even if it isn't that hard.

Felix1981 13:35, 13 December 2005 (UTC)

My question has been: "Please explain to me how you want to attract new workers when your working conditions are as crappy as your competitor's. - I answered it in that paragraph, ending with the summary sentence "capitalism favours assholes". Read it.

Your ideal model is already part of your current economy. It is called: buying bonds. - yes, me and Luis rib covered that point if you could just be bothered to read the below two sections. But the point is that should be the ONLY way to contribute capital. how does he get his money back if the company goes bankrupt? - company owners pay it back. In small businesses, owners ~= investors and loss is not a lot. In big companies, there are lots of owners, since everyone who works owns the company.

Work creates value? Not always. Sometimes work destroys value. - OK. I suppose I could have been stupid enough to think and/or imply that ALL work creates value, but whatever. Then you realize, nobody wants it. - Price and value are different things. Again, I've already said something about this in the below two sections. Please read them because I can't be bothered repeating myself. Also, I fail to see why that's relevant to the current topic, since I wasn't trying to argue the classical LTOV in the first place.

There is no equality of opportunity. And there never will be. - If you read up I believe your first point was "capitalism gives equal opportunity". I'm glad to see I've changed your mind on this. Also, please understand that I do agree that not everyone is equal. I'm just pointing out that in capitalism these inequalities are not representative of true values, and sometimes even the opposite, eg dumbass celeb has more money than leading scientist.

Work that truly counts is entrepreneurial work. - investors (entrepreneurs), by definition, do not work. I take it you mean managerial work, in which case the person is an investor-worker. Because only if this is done right, other work has value. - but if there is no "other work" there is no value AT ALL, as opposed to smaller value if there is no "managerial work". The manager-worker's output is affected by the worker's output - it increases more than in proportion to the workers'. That's a natural law of numbers (it's called MUL-TI-PLI-CA-TION) and does not mean the manager deserves more. That's like saying, (x=worker, y=manager): x=3; xy=15; without y, x=3, so y deserves 15-3=12. Infinity0 16:50, 13 December 2005 (UTC)

Anonymous user, please sign so we can keep different views straight. Even if you are unregistered, just put four tildes in a row. Also, let us try to use indentations consistently so we can tell one anothers arguments apart. Now, I have two comments for Infinity0 and one comment for both of you. Comment for Infinity0: first you say "the fact that the worker does not own the means of production." It is true that one stage in the development of capitalism is generally — and certainly at least in Europe — a process by which workers who posessed the means of production are disposessed of them. To me, this really really complicates the definition that capitalism is defined by "private ownership of the means of production." In fact, many private individual lost their ownership of the means of production, which is why they have to sell their labor-power. So the opening paragrapp or introduction jneeds to somehow communicate this, that as much as capitalism means private ownership of the means of production (or capital), it also means the loss of private owenership of capital. Second, I think I understand your explanation of exploitation theory, but I think the key point is that capitalists participate in two markets: the market for whatever they produce, and the labor market. Merchants like Marco Polo took advantage of the difference in price from one produce-market (say, silk for silver) in one place (say, China) and another produce market (say, in Venice). Capitalists take advantage of the difference in price between a produce-market and the labor market; their profit comes from the difference (if there is one) between the general price of labor they buy, and the price of the goods they sell. What this means is that the commoditization of labor-power is crucial to exploitation theory. This is my comment for Infinity0. Now my comment for both of you: please read my comment below. It does not matter whether either one of you likes or does not like, agrees with or does not agree with, "exploitation theory." What is important is that there are verifiable sources out there, some of whom promote and elaborate on "exp

That might be a job for another time/person - I don't know many "common" views or their sources - just mainly my own. And I'm appalling at actually starting any piece of writing, my main strength is editing. If somebody wrote a stub I could probably expand it quite a bit. Infinity0 21:21, 6 December 2005 (UTC)

Perhaps, Infinity0. However, I find it hard to believe that someone who has been able to articulate these positions so well has not read books or articles that count as "verifiable sources." I hope you reconsider your commitment to editing over writing. Slrubenstein | Talk 21:38, 6 December 2005 (UTC)

This honestly is an interesting discussion. Nevertheless, none of these comments can go into the article, because that would violate Misplaced Pages:No original research. There are, however, verifiable sources out there who have expressed a range of views on capitalism and class. Misplaced Pages:Neutral point of view demands that we include all major views, even if any or all of you disagree with them. Be that as it may, I cannot but believe that at least some of you are familiar with these citable sources and I urge you to put all the different views into the article, properly cited. Remember, the purpose of the talk page is to improve the article. Can't you guys channel all the energy you have been expending in this discussion into contributions to the article itself? Clearly among the two or three most active of you, you can develop a section that adequately provides the different views in an NPOV way. Slrubenstein | Talk 22:24, 4 December 2005 (UTC)

I tried to put my view into the article, but it was deleted. And I think if both of us don't find some sort of consensus, this will end up in editing wars. So, this discussion does have relevance because if this issue is settled, we can contribute to the article. At least that's what I hope for.

Felix

Felix, as long as you comply with our Misplaced Pages:Neutral point of view policy, and provide verifiable Cite sources|sources, no one should delete what you add. P{lease familiarize yourself with these three policies and make extra-sure you are complying with them. Then, no one has a right to delete your content and you can ask for community support. (the same of course goes for Infinity0 nd any other user — if someone is complying with these three policies, you shouldn't delete their work either. I am not accusing you of anything, just trying to be clear.Slrubenstein | Talk 18:31, 6 December 2005 (UTC)

I started here with Classes in capitalism because I wanted the claim that there are classes in capitalism to be attributed to the guy who invented them: Karl Marx. I changed the article to make it more accurate, yet it was edited out. Then I complained here and nothing has happened. This led me to start this wild discussion with infinity0.

My first post as an official member :) Felix1981 13:13, 7 December 2005 (UTC)

Hey, I just checked and the article is fine. Thanks. That's all I wanted.

Felix1981 16:41, 7 December 2005 (UTC)

Company ownership

I don't see your point. What's so good about owning a company? If you're lucky, you get rich, if you're not you lose a fortune. As I said above, if you had been a shareholder of General Motors stock, you would have earned no money in the last 12 years (the share price fell to a new low today). If you had founded Microsoft, you would have made a fortune. If you had owned Enron stock, you would be broke. Owning a company entails enormous risks. If workers want to take such a risk, they may invest on the stock market (actually, GM stock is owned to a large part by workers - which certainly didn't benefit the workers!). Luis rib 19:44, 18 November 2005 (UTC)

You make a big deal about the "risks" involved. That's really not the point. Whatever the risk, the workers don't get their full worth. Infinity0 20:15, 18 November 2005 (UTC)

Of course risks are the point! Risks are the whole point! And why do you assume that workers don't get their full worth? Salaries are one of the major cost positions in most corporations. Take Nestle ( a big food company based in Switzerland): in 2004, salaries and welfare expenses amounted to 13 bn Swiss Francs (approx. 9 bn US dollars), while the net profit of the group amounted to 6.7 bn Swiss Francs (approx. 4 bn US Dollars). So after all the workers got a bigger share of the income than the shareholders. Luis rib 21:08, 18 November 2005 (UTC)

What? Do you mean to imply ALL workers got a bigger share than ALL shareholders?? You're just manipulating the statistics. Most real workers (who mainly work and invest little) earn little; most real shareholders earn lots. Nike pays Haiti sweatshop workers 37c a day. And why are risks the whole point? I thought the whole point of an economy is to produce things? Infinity0 21:56, 18 November 2005 (UTC)

Are you familiar with the labor theory of value, Luis? Grant65 | Talk 21:38, 18 November 2005 (UTC)

He might quote the marginal theory of value, which is IMO, is better described as a theory of price, not value. Value is absolute, price is relative. Infinity0 21:50, 18 November 2005 (UTC)

Indeed, I would be quoting that theory, and others, which are more recent. The labour theory of value was established approx. 150 years ago (and was used not only by Marx, but also by other famous economists like Ricardo). Since Walras, however, marginal theory of value is considered as being more correct and as representing the real world more correctly. Indeed, I find it absurd that value would only be constituted of labour. After all, labour needs machines to work on, and the better the machines, the better the final output, and so the more value it should have. Also, the labour theory of value does not consider demand: you can have hundreds of workers making wooden gnomes, but those gnomes will be valueless if no-one wants them. It's just wasted work. Infinity0: you claim that value is absolute and price relative. How can this be? That would mean that a medieval cooking pot would still have the same value today as 500 years ago? Who would use a medieval cooking pot? Value cannot be absolute - and actually value cannot be really distinguished from price (except when prices are fixed or biased, in which case I would say that value can differ from the observed price). Luis rib 12:17, 19 November 2005 (UTC)

As above, who makes those machines? The price of the cooking pot is relative, the value is the same, unless the actual object decays (as over 400 years it would). People act on price, but labour creates value. The price of a DVD player has decreases - but has the intrinsic value of it changed? It's still exactly the same thing (unless it rusts :P). As for the marginal theory of value, I hereby present a refutation of it. Ready? here goes:

• If nobody worked, how would value be created?

WOW, a one-sentence refutation? I am god. :P Infinity0 12:24, 19 November 2005 (UTC)

The machines are made by companies, which again employ labour and other machines, as well as natural ressources (metals and such). Also, I disagree toatlly that value remains constant. An LP has no real value in age of the CD; and the value of a CD has dimished as MP3 players have become available. Value is defined by the advantages it procures to its users, as compared to other things that provide the same or similar uses. Also, your one-sentence refutation is stupid. If no-one worked, people would still need to eat and drink, and water and food would be extremely valuable. Value can exist without any work - gold can be simply found in nature (in some rivers, for instance) and always had a lot of value for completely irrational reasons - also the value of gold is totally disproportionate to the amount of work involved in collecting it. Luis rib 12:32, 19 November 2005 (UTC)

Um, that would be price you're describing, with the CD and LPs... Also, the value of water and food is always there - I wrote "created" value. And gold represents a price, not value. It is only used as a method of exchange; saying it has value would be the same as saying money has value. Money has no value; what it is exchanged for has value. Infinity0 12:56, 19 November 2005 (UTC)

Also, it's wrong to say "companies" create machines. People create machines, a company is just a collection of people. The machine-maker does not have to be part of a company to do the act of creating. Infinity0 13:00, 19 November 2005 (UTC)

Gold has other uses than a means of exchange. Some people like gold as jewellery; gold also has a lot of industrial uses. These uses, however, were totally unknown thousand years ago. So it's wrong to say that gold's value is inexistent: it always had value as jewellery, and it became even more valuable once industrial uses were found for it. Luis rib 16:57, 19 November 2005 (UTC)

Too many references

My point is that the quote is too long, basically, the second part doesn't say anything new. The page is way too big IMO and has way too much specific stuff like quotes from arbitrary right-wing economists. If you really think that quote gives so much extra information to the reader, then fine, keep it... Infinity0 23:36, 18 November 2005 (UTC)

The second part does say something. It's a person who says the US is not a capitalist, but a mixed economy. That's what the section and paragraph is about ...which economies are capitalist or are not and which are mixed economies, rather. RJII 23:40, 18 November 2005 (UTC)

Fixed profits for investors

Infinity0, you asked somewhere above why invetors shouldn't get a fixed incomre from their investements. Actually they can get a fixed income, when they invest in corporate bonds. By investing in corporate bonds they don't become owners of a company, but lend money to that company. For that they get a fixed interest rate. Thus investors do have a choice: buy shares and get a variable income, or buy bonds and get a fixed income. You propose that shareholders should get a fixed income too - that would mean that when a company produces losses it still has to pay the same dividend to is shareholders than when it makes tons of profits! That's a very good way to bankrupt a company... Luis rib 11:42, 19 November 2005 (UTC)

Atm, a company has to pay wages to the workers even if they don't make profit. That's a good way to bankrupt a company too. I'm just suggesting you swap that around so the shareholders get a fixed price, but the workers get a variable price. So, if a company doesn't make profit the workers don't get paid, instead of the shareholders don't get paid. Infinity0 11:59, 19 November 2005 (UTC)

So you prefer that a company that is in trouble fire its workers and continues to pay hefty dividends to its shareholders? Luis rib 12:24, 19 November 2005 (UTC)

How can the company pay "hefty" dividends if they fire their source of income? ;) And if the worker think's it's too tough, he can always quit. But do you have any statistics on what percentage of businesses go bankrupt, generally? I'm just interested so see if your argument against my theory is a common situation or not. Infinity0 12:49, 19 November 2005 (UTC)

Also, I didn't mean a fixed interest rate. I mean a fixed profit (ie, share profit increases over time to a maximum). The investors do jack, so why should their money increase with time? Infinity0 12:00, 19 November 2005 (UTC)

Economically, that's the same. They would get a maximal fixed amount per share. That's the same as if they would lend money to the company and get a fixed interest per bond. The shareholders provide the money which the company needs to operate. If the company doesn't pay them anything, they will take their money away and will put into a bank account. Then the company will cease to exist. We had this discussion above already. A company is defined by being a legal entity of fixed capital which is divided into shares or parts (depends on the type of company). If you take the shares away, there no company left. And you will only convince people to invest into such shares if they can expect a benefit from that. Luis rib 12:24, 19 November 2005 (UTC)

Ignore the legal discrepancies. Say a company got its capital from investors who invested in "bonds", ie fixed-profit "shares", and instead the workers are the ones who legally own the company (ie, shares), and hence, get a proportionate-profit. That's a lot more fairer, right? And I don't see any economic problems with this either. People would still invest as they still get a profit. Infinity0 12:29, 19 November 2005 (UTC)

Of course your example is perfectly workable, and there are some small companies which are entirely owned by its workers. In several European countries there exists a legal form called "cooperative corporation" where all the shares are owned by workers. The reason why this type of corporation is not more common is that workers usually do not have enough money/enough savings to invest into the corporation they work for. Also, the problem with giving the outside investors only bonds means that the corporation becomes indebted. If a corporation issues too much debt (i.e. too many bonds) it may not be able to repay all these bonds and may become bankrupt. That's why at some point many corporations decide to issue more shares, to push their level of indebtedness to lower levels. Luis rib 12:39, 19 November 2005 (UTC)

What I mean is the proportionate profit is intrinsic to the worker's contract - it's not something they have to invest in. Also, the company can perfectly well put a limit on the bonds they issue. The whole point is to AVOID debt - it can slow growth but gives a more stable economy. As for issuing new shares to outsiders, well, that's just exchanging justice for short-term money :( Infinity0 12:49, 19 November 2005 (UTC)

Bonds are another word for debt. If say that investors should only get a fixed amount of money on teir titles (whether you call them bonds or anything else) that's just the same as saying that you are issuing debt. So you can only avoid debt if you give investors shares, which pay variable income. Why is issuing new shares exchanging justice for short-term money???? That statement makes no sense at all! Luis rib 13:01, 19 November 2005 (UTC)

Maybe bonds is the wrong word for what I'm describing, I'm not familiar with the terminology. But if bonds are debt, then fixed-wages are debt too. You are going to argue that the company gets something out of wages - well, they get something out of bonds too. Also, did you not read the above point about how it's unfair to give workers a fixed-wage? By issuing new shares you are giving someone a proportion of the profit, in exchange for a fixed (insert whatever word suits you) - potentially infinite money in exchange for finite money, and no work. You also give influence to an outside investor, who does nothing. Infinity0 22:05, 19 November 2005 (UTC)

Wages are a cost, not a debt. Except if you don't pay them, in which case they become a debt. And the outside investor does something: he provides money to the company to pay wages, to buy machines, etc. Luis rib 22:54, 19 November 2005 (UTC)

Actually, funnily enough, many companies are partly going your way, Infinty0. Wages are in many companies linked to merit, which at least tries to evaluate a worker's contribution to a company's profit. Also, many companies are giving their shareholders almost something like a fixed income - by keeping dividends constant. Some don't even pay any dividends at all (like Microsoft, for most of its history) which mean that all the profits are kept inside the company. The investor's reward is a rise in the share price - since the company is becoming more valuable, its shares are worth more. That's how Bill Gates became rich, and not by taking the profits away from Microsoft. Luis rib 23:01, 19 November 2005 (UTC)

I don't see the distinction. Whatever argument you can apply to wages to describe them as a cost or debt, the same or a similar argument can be applied to bonds to describe them as a cost or debt. Investors give once, the workers work constantly. In that sense, they "do" nothing (or, maybe more accurately, one thing).

Shares worth more over time? That's a variable price. And I know that wages are supposed to be linked to merit, but we all know that's a false pretence. Wages are affected by many discriminatory things. Also, it's still a fixed wage as whatever changes are made to it are made by the owners of the company, who want to maximise their profits. Companies might make these changes go further, but I guess we'll just have to see :) Infinity0 23:49, 19 November 2005 (UTC)

Labour theory of value

I'm sure you'll excuse me if I continue the discussion here. It was becoming quite messy up there... So, you said that "Labour is the source of all man-made value". That's too simplistic. The amount of value labour is able to create depends on the machines (i.e. capital) it has at its dîsposal. These machines have been made by labour again, and by natural ressources. Natural ressources have a value that is independent of the amount of labour needed to get it. Petrol for instance has the same value no matter whether it comes from Saudi Arabia (where it is very cheap to extract it and almost no labour or machines are used) or Alberta (where it has to be squeezed out of some tar sands in a long, complicated and expensive process). Also, don't forget that at all points in the value chain capital gets paid too. The company that makes the machines also takes a margin on each machine as profit, to pay its creditors and its shareholders. Without capital, the machine-making corporation would not be able to buy the natural ressources needed to make the machine! Luis rib 12:58, 19 November 2005 (UTC)

You're not arguing against my point - in fact you reinforced it. What I am saying is that all created (artificial) value comes from labour. This doesn't mean that all labour creates value, answering your oil-gathering point (but for the purposes of economics, the workers have as good as created that value). This also doesn't mean that all labour creates the same amount of value, solving your machine-made point. All I am saying is that all created value comes from labour, at its very source. You can try to find a counter-example; I can't think of any.

Yes, without capital, blah blah. I'm saying capital and labour should be merged. The workers own what they work. That's all. Initial capital will be from investors who invest in fixed-profit (shares, bonds, whatever). Infinity0 22:17, 19 November 2005 (UTC)

Sure, labour and capital together produce value. I'm fine with that. However, workers do not need to own the capital. How would an unemployed person find work if she could only find a job if she had the necessary instruments/capital? Luis rib 22:47, 19 November 2005 (UTC)

She? :| Anyway, you're misunderstanding me. Workers won't buy ownership. The ownership is intrinsic to their work contract. A company wants new workers, it gives them joint ownership as well as a proportionate-wage. And the workers don't own capital, they own the company. Which capital are you talking about, anyway? And "need"? Since when did investors need their capital back?? Infinity0 23:42, 19 November 2005 (UTC)

Unless this is a private party, allow me to hop in. As to profit as an institution, it represents several different realities. To begin, there's the simple fact of time preference. Everybody prefers now to later. If a two year old child has a right to a cookie now or a cookie tomorrow, he'll take the cookie now every time. As we get older, we learn to delay satisfactions, but still in some sense we have to be bribed to delay, there has to be a reason for the delay, some larger size to tomorrow's cookie.

Another consideration is that nature produces extra value over time. This was one of the key points in Henry George's view of the world, and although he is best remembered for the single tax proposal, that was only one part of a broader system of thought. Seeds turn into stalks of wheat, and gain in value as they grow. Grapes go from small and green to large, juicy, and purple, and likewise increases in value. Grape juice in a vat ferments into wine. In other words, by co-operating with the productive forces of nature we can bribe each other into accepting those delays, and getting that "bigger cookie tomorrow". In this sense, profit is a product of nature, both human nature and biology more generally.

Yet another consideration is risk. When you said above that risk is "the whole point", someone objected that productivity was supposewd to be the whole point. But that's a phoney dichotomy. Many productive enterprises involve risk of loss, and again someone has to be bribed to take those risks, whether through prospective interest payments or through equity profit or something else.

So, to summarize these considerations. The instinctive timne preference, combined with risk aversion, creates a demand for some institution whereby both the deferral of immediate gratification and the taking of risks will have a reward. The productivity of nature, and the various roundabout ways in which humans can aid that productivity, create funds whence that demand can be supplied. That demand, and this supply, together create a financial/banking system, unless some outside coercion blocks its formation. Virtually every society has some sort of financial/banking system to mediate all the to-and-fro of funds that arise from such considerations as these, although there is always the question what kind of financial system will do this most effectively. That is the kind of question an article about capitalism should systematically survey. --Christofurio 16:04, 19 November 2005 (UTC)

I didn't get the impression you were trying to argue anything, but the points you made, I sort of understand. But do you think that production depends on risk? I think that risk and production are independent of one another - you can lower risk whilst increasing production. Infinity0 22:17, 19 November 2005 (UTC)

Still, your argument goes that workers should take the whole risk (because they should own the whole thing) and investors should bear almost none of the risk (no matter what happens they get a fixed income). That's quite a radical idea. I'm not sure a lot of workers would be willing to take it. Luis rib 22:47, 19 November 2005 (UTC)

I thought you said risk was the whole point? But whatever, you're just twisting words. The correct concept is responsibility. The workers get what they deserve. If they work well, they get more money. If they don't, they get less. Investors have no responsibility towards the company, and so they should not expect anything in return. And you can keep on this pretence all you like, but you're just describing the maximum-loss situations. In the situation of maximum gain, the workers stand to gain far more than they lose in the maximum-loss situation. Especially workers who have unfair wages to start with, like sweatshop labourers. Infinity0 23:42, 19 November 2005 (UTC)

Even sweatshop workers can lose their job and end up as cheap prostitutes in a Bangkok backyard. That much for "sweatshop workers have nothing lose". Luis rib 21:59, 20 November 2005 (UTC)

That's true, but I didn't say they had nothing to lose - just that they would gain far more that they could lose. A big company, like Nike, especially, doesn't have a big risk of going bankrupt. So the sweatshop workers would really gain much without fearing a significant risk of loss. It's mostly the big companies who hand out unfair wages etc anyway; this change wouldn't affect small businesses much, as their owners and workers are basically the same people. Infinity0 22:27, 20 November 2005 (UTC)

Infinity0, in answer to your question -- yes, productivity is correlated with risk. Sometimes it is possible to lower risk without sacrificing productivity -- but that just proves that the preceding situation was inefficient, and the subsequent situation has eliminated waste. Assuming state-of-the-art efficiency in a given industry, there will be a trade-off. Further productivity increases will come at the expense of taking on greater risk (a greater volatility of returns), or risk will be lowered at the expense of over-all productivity. After all, the more productive arrangements are the more roundabout ones, and the more roundabout an arrangement, the more can go wrong with it. Where the risk/return trade off ought to be in a particular industry is precisely what the private capital markets decide. This is the sense in which risk can fairly be called "the whole point." Not risk like one takes at a casino, but the risk one takes in investing to build a casino within an already competitive market.

And, BTW, it isn't true that big companies have little risk of going bankrupt. WorldCom and Enron were both huge. General Motors was regarded for decades as the paradigm of a company that could never go bankrupt ... now it may not be far from ther. Nike isn't immune from market forces either. --Christofurio 14:27, 21 November 2005 (UTC)

Surely if you give ownership to the workers they will be more likely to work better - that's decreasing risk whilst increasing productivity. Also, your examples only strengthen my claim - three big companies have gone bankrupt out of how many? And Enron's bankrupcy was the fault of its owners - no special "risk" there as they knew exactly what they were doing. Infinity0 16:40, 21 November 2005 (UTC)

There is no reason to be "sure" of the first of your sentences, and just sticking "surely" in front of it doesn't constitute evidence. Some workers work "better" (whatever exactly that means) if they have an equity interest, others would prefer to sell the equity interest and take the cash, and perhaps invest it elsewhere -- that decision wouldn't at all imply that they would be slackers on the job compared to the first lot.

Further of course, any market-based society I know of does include worker owned enterprises as one model, so this is constantly being put to the test. Some such enterprises do well, others don't. Its all part of the higgle-haggle. In general, I wouldn't expect that in circumstances of freedom worker ownership will ever entirely supplant market-traded equity interests, because the latter creates certain signals that do help workers work 'better' in a certain sense -- better in terms of direction toward some consumers' needs. I may be wrong in all of that, but I'm surely not wrong just because you can type "surely". So, after all, can I.

Also, you're still rather missing the point about the risk/productivity connection. Assume two different worker-owned enterprises in the same line of work ... both making widgets. Assume that both are maximally efficient according to the widget making state of the art. Does it follow that they are both taking on the same level of risk? Not at all. There will still be a trade-off, (Risk, in this sense, can be defined as the variation around the norm of return for a given period.) In the absense of a market in exchanged equity, though, their respective trade-offs won't have any transparency. In an important sense, they won't know what trade-off they're making, which will make their managerial decisions less well informed than they could be.

Even if only one big company has gone bankrupt, that is enough to establish in principle that bigness is consistent with risk, which is the only reason I provided the examples. You seem to think that bigness vanishes risk ... but you also seem to think that worker ownership banishes risk. Neither is the case. Risk, given the above definition, is ubiquitous.

Also, the notion of "fault" has nothing to do with the notion of "risk" one way or the other. When did I ever say anything about a risk having to be a "special" risk?

Enron's owners and the managerial employees who made various disastrous decisions were to a great degree the same folks. Skilling and Lay didn't become better "workers" (of the managerial sort) by also being owners, did they? The point remains, Enron's returns exhibited plenty of risk, and neither the bignes nor the worker ownership banished it.

--Christofurio 00:59, 22 November 2005 (UTC)

Using "surely" was an indication for you to show otherwise, since my assertion was obvious, to me anyway - that is, if you directly own something you are more likely to work better. You have only suggested that this might not be true because workers who don't own what they work might be better "directed towards their goal" - why and how is this?

I never said they would take on the same risk - in fact I said the opposite, that risk and productivity are not correlated. Also, I never said that big companies never go bankrupt - just that they are far less likely to than smaller companies (ie. the risk is far less).

And by "no special risk" I meant that the owners of Enron knew that what they were doing would bankrupt the company, and so it can't be classified as a bankruptcy due to normal risk (ie. unpredictable events).

The point of worker ownership is to make the system fair - I explain why it's unfair somewhere above. And you don't become "better" by owning your own work, you have more "incentive" to work (which is I believe, what rightists claim to be one characteristic of capitalism).

So please, understand what I write next time, because I haven't seen any counter-arguments yet. Infinity0 16:38, 22 November 2005 (UTC)

You won't see counter-arguments if you don't want to see them, I suppose. But I'm addressing your points, such as they are, as clearly as I know how. For example, I perfectly agree with you that when you say 'surely' what you really mean is "obvious to you." That isn't evidence, or even a point that would in itself require a counter-argument, though.

"I never said they would take on the same risk - in fact I said the opposite, that risk and productivity are not correlated." Infinity0 18:52, 23 November 2005 (UTC)

That just strikes me as strange. It wasn't an assertion of an inevitability. but a hypothetical example. If two worker-owned enterprises were to take on the same risk profile, and if they both used state of the art methods for producing widgets, then isn't it likely that they are also variant as to productivity ... and that the one with the greater risks is (in its average period) more productive than the one that plays it safe? This doesn't have anything to do with unpredictable events, by the way. Risk in the sense I've been discussing involves variation around an average performance. In other words, suppose over a period of 5 years (which is of course 20 quarters) a certain firm produces an average profit of 5% a quarter. But some quarters it has a loss of up to -1%, and other quarters its gain is higher than average, as high sometimes as +11%. That is a certain risk profile. Another firm might get the same 5% a quarter result by producing exactly 5% profit every quarter, like clockwork, with no variation. In this case, the second firm has the same return as the first, at much less risk. I'd rather invest in the second than in the first, wouldn't you? Most people would, because they'd be getting a reduction of risk with no cost in terms of profit. But where there IS a trade-off, the investment choice gets more interesting.

"Also, I never said that big companies never go bankrupt - just that they are far less likely to than smaller companies (ie. the risk is far less)." So there is risk in any event. There is a variation around the mean return, and the tail of the curve extends into the negative numbers. That is the sort of risk that feeds back into value.

"And by 'no special risk' I meant that the owners of Enron knew that what they were doing would bankrupt the company, and so it can't be classified as a bankruptcy due to normal risk (ie. unpredictable events)." Here again you're simply giving the word a meaning of your own. You are entitled to do so, as far as I'm, concerned, but you should understand that when the people you're discussing this with draw connections between risk and investment, risk and value, risk and productivity -- the word "risk" as used in making all those connections doesn't relate to fault at all. It is volatility, or a deviation around the average return, that is under discussion. Such deviations can be perfectly predictable -- they still constitute risk in the relevant sense.

"The point of worker ownership is to make the system fair - I explain why it's unfair somewhere above. And you don't become 'better' by owning your own work, you have more 'incentive' to work (which is I believe, what rightists claim to be one characteristic of capitalism)."

Advocates of capitalism (rightist or not) recognize the value of incentives, and regard investment as just as much a matter of incentives as is labor. There were people (i.e. certain short sellers) who recognized that Enron stock was getting very volatile before the big blow-up came and they played their incentives by betting on a decline in its value. They did society a service while making themselves a profit in the process.

As to worker ownership -- if the labour theory of value is to mean anything, it must include management as a form of labor, must it not? And this makes Ken Lay, who owned a lot of Enron stock, an example of a worker-owner. Did that fact make him productive? --Christofurio 15:49, 23 November 2005 (UTC)

I don't see counterarguments because you're not providing me with any... Why wouldn't I want to see them? I want to think up something that both works, and is fair. If this doesn't work, then I want to know about it. obvious to - well, can you tell me why it's not obvious to you (ie. produce a counterargument)? You're trying to make me come off as subjective, but that on its own doesn't mean I'm wrong.

What? the one with the greater risks is (in its average period) more productive than the one that plays it safe? - the definition of risk, is that they COULD be more or less productive - ie. their productiveness range is bigger. You can't just assert that risk gives higher production - it gives lower production too. And you define risk as variation around an average? Well, have you read the above context? By risk, all this time, I have meant the risk that a company goes bankrupt, from unpredicatble events (careful planning will avoid bankrupcy due to predictable events, eg. variations around an average). Also, averages tend to balance out. And normal variations can't really be called risk. Risk by definition is unpredictable.

So, there is risk in any event. Um, risk is a continuous variable??? Big companies are less likely to go bankrupt... why are we even arguing on this point...? I used the word risk to describe the chances a company would go bankrupt. I'm not learned in the intricacies of economies, so all those definitions you listed, I didn't mean, nor was I talking about those definitions, nor are they relevant to what I was talking about.

As to manager-workers, yes, I agree they are needed. But that also has no relevance to my point that all workers should own part of their company. I don't know who Ken Lay is or what he was thinking. (I am assuming from your tone that he was partly responsible for Enron's collapse). You're using a crap example, since he was one of the FEW worker-owners in the company. He owned a LOT of stock, so he was mainly answering to himself, and only a few others. And obviously his incentive was money - whatever he did (could have potentially) gave himself more than working. But if all the workers owned a part of Enron, he'd have to answer to all of them if he steals from them (or whatever he did), which is an incentive to not do that bad thing. Infinity0 18:52, 23 November 2005 (UTC)

As I say, you can use the word 'risk' in any way you want to. You can define risk so that it is "by definition unpredictable" if you want, but I don't define it that way, and the non-Marxist tradition in economics doesn't define it that way in general. All I ask is that you understand that risk in the sense I've been discussing (to which you can give some other name if you like) is correlated with productivity, interest rates, and profit. Let's call it volatility just so we won't unnecessarily quarrel about words, okay? And so I won't have to write it all out each time, I'll sometimes call it just "vol," okay? Do you acknowledge that those other variables I've just named are likely to be functions of vol?

To understand why they are, consider again those two hypothetical worker-owned companies I've been talking about. Suppose they produce just as many widgets as each other every month (i.e. they have the same productivity) but one of them has very volatile returns, whereas the other has very steady returns. Suppose the only way of "investing" in either of these two firms is by going to work at one of them or the other. Now: which of them would you rather work at? I submit that most rational people in that situation would rather work at the low-volatility plant. One has to be bribed to work at (or invest in) the higher vol plant, and the bribe takes the form of a higher return (a larger wage, or bonus, or dividends, or whatever you want to call it!) Yet the igh-vol firm would have to be making more money than the low vol one to be able to afford to pay out that higher return in any of those forms.

What I conclude from this is that the situation I first hypothesized, one in which equal productivity co-exists with variable volatility, is an unstable one. It can't last. It isn't, in other words, an equilibrium. The only situation that is in equilibrium is one in which the higher-vol firms are also, on average, the more productive firms.

One more point about incentives, for now. People have a strong incewntive not to put all their eggs in one basket. No matter how hard a worker I am, its always possible that through no fault of my own, my company may become insolvent. Even if the company is big and I regard this risk as small, I'll want to hedge against it. So I'll want to be able to invest some of the money that I earn somewhere else, somewhere that I don't work. It seems an arbitrary limitation of my decision making to tell me that I'm not going to be allowed any choice, that equity in other companies won't be for sale. This is one of the reasons why I believe that in circumstances of freedom, worker-owned enterprises will never entirely supplant invest-owned enterprises. there is too strong an incentive to diversify, and one can't diversify one's labor very far, so one has to diversify by purchasing investments in businesses where one doesn't labor,i.e. by becoming an investor in an investor-owned firm.

Are we in accord on these points? --Christofurio 20:53, 24 November 2005 (UTC)

First of all, in the examples above which I made up, I didn't say that that people can't invest (lend out capital), just that they should get a fixed-price return. So people can still share their eggs out in different baskets.

What do you mean by volatile? If I understood you correctly, it is a concept which is only applied by external investors when they evaluate the company - how its workers perform, etc (ie. internal risk). (External factors like interest rates and profit are unpredictable risk, and affects all companies equally.) How can worker-owners evaluate this concept of volatility when they themselves are the factors of it? So, your "bribed to take risks" point doesn't apply. The worker-owner isn't taking a risk, or if he is, he's taking his own risk. And how can you be "bribed" if what you work directly affects what you earn? There isn't any extra money in some "bribe deposit box". Actually, in the case of worker-owner and proportionate-wages, the bribe is the risk itself. Higher risk gives a bigger range of profit, you have a chance of gaining more - a "bribe".

I agree with your risk points when applied to ordinary capitalism, though. Just not in my special scenario.

Also, this: the higher-vol firms are also, on average, the more productive firms. - it is more accurate to say that in a situation with two companies of unequal vol and same productivity, the higher-vol company does less well because it has to pay its investors back more (thus it is driven to higher production). It is higher returns to investors which makes people have to work harder, not the risk itself. High returns aren't just caused by risk. And productivity isn't only affected by high returns, and high returns doesn't always affect production. Infinity0 23:13, 24 November 2005 (UTC)

If you want to understand the concept of volatility, better, you might begin with the wikipedia article on the subject. I don't see any value to a distinction between "internal" and "external" investors. If a worker is free to leave and work elsewhere, then he has a "external" choice. So the "bribed to take risks" point applies not just when deciding where to go to work, but whether to continue working where they are rather than taking another offer. In general, there is nothing special about what you call your "special scenario." A worker will rarely be in a position in which the productivity of his firm is affected solely by how hard (or smart) he works, so there will always be the incentive both to work at a place with a proven low-vol record and to diversify.

The high-vol firms will have to bribe quality workers to stay, and this in turn means that at equilibrium, the only high-vol firms that survive will be those for whom the volatility is related to greater productivity. In the equlibrium situation, then, the higher returns are caused by the higher vol, because the vol that is taken on is of the productivity-enhancing sort.

"I didn't say that that people can't invest (lend out capital), just that they should get a fixed-price return. So people can still share their eggs out in different baskets."

Once again I don't see the distinction in principle here. It sounds like you're saying that investment in corporate bonds is in principle better than investment in corporate stock -- i.e. one is less exploitative than another. If that is what you believe, you may be the only person in the world to believe it. To show why, let me ask you this: If all the "external" investment came from the bondholders, wouldn't the bondholders have greater exposure in the event of a company default than they have now? After all, if a company fails, under current law in most capitalist countries, the stockholders take the hit first, then the bondholders are usually compensated with the equity of the re-structured company. But in your scenario, there aren't any stockholders any more to cushion the fall for those bondholders. So the bondholders are just out of luck in cash of insolvency, right?

In such a scenario, it seems to me, bondholders would soon (and quite sensibly) begin to demand some of the rights common stockholders have now -- whoever has that residual insolvency exposure, whatever its name, should have some say in who gets to manage the company. So the distinction between investment in equity and investment in a "fixed-price return" would be more one of verbiage than of substance. --Christofurio 16:03, 27 November 2005 (UTC)

I don't see what you mean by "internal investors" - all investors are external; I just added that word to be clear. Actually, a worker a in small business will drastically affect the productivity of his firm. And in large firms, the volatility is very small due to the law of balancing averages.

Also, can you clarify your second paragraph, I don't quite understand it. I disagree with the first phrase, "will have to bribe". Most large businesses are stable - low-vol. So, most high-vol businesses are small businesses. Now, in a small business, an individual's work affects company productivity quite a bit. If the firm had my proposed structure, where the worker's wage is directly related to productivity and profit, how can it "bribe" the worker (it has no extra resources for the bribe)? Like I said above, the risk itself is the bribe. (By contrast, in normal capitalism, "bigger promised returns" is the bribe for stockholder investors.)

In my scenario it would be the workers who take the cushion fall if anything goes wrong. The fault is most likely theirs, so they take the fall. Basically investors and workers swap positions. In normal capitalism, investors get a proportionate-profit, workers get fixed-profit(wage). In my scenario, investors get fixed-profit, workers get proportionate-profit(wage). And in doing that, the roles of responsibility are just swapped around. There's no gaps or anything, I don't think. And because there are more workers (usually), the damage is more spread out too. Infinity0 16:59, 27 November 2005 (UTC)

Workers who by their sweat, so to speak, are building up equity in a company might well be called "internal investors" just like a jockey who's bet on his own horse might be called an "internal bettor." I tookover the terminology from you and don't see anything to object to in it. I have no objection to a jockey's decision to bet on his own horse, although I also wouldn't have any objection if he wants to hedge his bets by putting some of his money on another horse.

"Actually, a worker a in small business will drastically affect the productivity of his firm." Depends on how small is small, I guess.

"And in large firms, the volatility is very small due to the law of balancing averages." I've never heard of any "law of balancing averages." There's a law of large numbers, but it doesn't mean what you seem to think it means. The law of large numbers simply says that as a population grows, the number of occurrences will take on the appearance of a symmetrical bell curve. But some distributions at any scale will still have a larger deviation than others -- they'll have what statisticians call "fat tails." Do you know of any actual empirical data that support a connection between the size of a firm and the amount of volatility of its revenue and/or profits?

I don't believe there is necessarily any 'fault' in a business failure, so I wouldn't apportion loss according to some moralistic theory of blame. Nor do I even understand the claim that your system would cushion losses because there would be usually more workers than investors. How much of one's livelihood would be at stake, in either case?

At any rate, my points are what they were and I don't believe you've addressed them. Whatever their size, high-vol firms will suffer from loss of high-quality workers unless the volatility works itself as a 'means of production' -- unless the volatility is part of a system that increases the norm. This is the heart of the financial capitalist response to the labour theory of value -- that risk, or volatility if you will, is itself an important factor in production.

Looked at another way, if and only if the fat tails (higher risks of a melt-down or a bonanza) contributes to a higher norm at the center of the bell curve, then the higher norm in effect establishes a kitty whence the more mobile workers can be bribed to stay. In the equlibrium situation, then, the higher returns are caused by the higher vol, because the vol that is taken on is of the productivity-enhancing sort. --Christofurio 16:07, 3 December 2005 (UTC)

Well, then they're worker-investors. By "investors", by induction, I meant that they are not workers. But anyway. As for the empirical data, I was hoping you would provide me with some.

Look at it this way: investors don't do anything with the company - so if the company fails, it's not their responsibility, and what's the point of punishing them? The workers are the ones with the most responsibility for whatever happens. As for the risk of loss, well, you said that volatility increase production. And because the workers get more much that they would otherwise, that decreases their loss-potential.

I'm sorry, but I've lost track of what your point actually is and what relevance it has to my scenario. At the moment, I understand that volatility makes companies produce better, but only by drawing in good workers. The volatility itself doesn't do anything. I don't see how volatility would change in my scenario. Companies would still have volatiliyy, and workers still have free choice to choose a company to work with.

As for the LTOV, if by value, you mean "price", then yes, it's inaccurate. I wasn't arguing with that. I only pointed out that labour creates all value (intrisic, objective, value, whatever that is). People however aren't objective, and the price of things will differ from its value. Infinity0 16:48, 3 December 2005 (UTC)

First use of Kapitalismus

According to this: "Werner Sombart" "Der moderne Kapitalismus" (Modern Capitalism) was published in 1902, not in 1906. --Alex1011 19:50, 25 November 2005 (UTC)

Definition of capitalism

A couple people (e.g. slrubenstein) are reverting my edits to correct the error in the definition that says commodities includes goods and services. A commodity is a physical item. It's rarely used to refer to a service. RJII 20:26, 5 December 2005 (UTC)

Also, Infinity and Slrubentstein are trying to put in the "common" definition of capitalism reference to "wage labor." Capitalism is not commonly defined with reference to "wage labor." Just look at the various definitions in Wikiquote. RJII 20:29, 5 December 2005 (UTC)

I'd also like to note that slrubenstein reverted without an explanation (a no-no), and dishonesly registered it as a "m". I've had a lot of problems with that so-called editor. I've seen very disruptive and unethical behavior from him in the past (such as launching a fraudulent arbitration case against me to try to get his way with this article). Watch him. RJII 20:31, 5 December 2005 (UTC)

A "commodity" is anything which has value. Definitions of capitalism do tend to miss out this point, but that doesn't mean it's false. I've never seen or heard of a capitalist state which does not use wage labour. Please explain why capitalism and wage labour are not related, or give an example of a capitalist state which does not use wage labour.

No, in economics, a commodity is NOT anything with value. It's a physical item with value. RJII 20:59, 5 December 2005 (UTC)

You probably checked for the international spelling, "labour". Checking for "labor" gives this:

• Scott-Foresman Intermediate Dictionary: "an economic system in which private individuals and groups of individuals own land, factories, and other means of production. They compete with one another, using the hired labor of other persons, to produce good and services for profit."

Haha. Dude, that's a children's dictionary. Maybe you didn't know. RJII 20:51, 5 December 2005 (UTC)

• Dictionary of Critical Sociology: "A system which separates workers from any property rights in the means by which they produce culture by their labor. The system transforms the social means of subsistence into capital on the one hand and the immediate producers into wage laborers on the other hand.

This is just a so-called dictionary written by a someone from the U of Iowa Sociology Deparment that he put on the web. It has almost no importance or recognition. RJII

...And I'll gracefully miss out the two Marxist definitions in case you accuse me of bias. Infinity0 _contribs 20:44, 5 December 2005 (UTC)

Labor is covered in "services". The trading of goods and services in a free market, includes trading the service of your labor. RJII 20:57, 5 December 2005 (UTC)

About your replies to the definitions... And? Are you going to say it's wrong, or what? The other "famous" definitions don't even say it's wrong - they just miss it out. The definitions of capitalism in wikiquote come from dictionaries, and of course they are not going to give a complete one. Capitalism is about capital. And that capital is used to employ wage labour, what else? Infinity0 _contribs 21:01, 5 December 2005 (UTC)

So, you are going to reduce the role of labour down to a mere "service". That's misrepresentative to the reader, and also extremely dehumanising and biased. A service does not earn profit for the person exploiting the service; labour does. Infinity0 _contribs 21:01, 5 December 2005 (UTC)

Of course labor is a service. Philosophically I have no problem with saying that capitalism includes "wage labor," --people buying and selling labor for money. Of course it does. But, the article is the "common" definition. If we don't stick to the way it is commonly defined then everybody can stick whatever they want in there as long as they can find some obscure source. RJII 21:10, 5 December 2005 (UTC)

How is this an "obscure" definition? All corporations in capitalist countries employ wage labour. Also, like I said, the dictionary definitions (of any complicated systems) are always incomplete, due to space restriants. And labour isn't a service, for said reason above. Unfortunately google isn't helping, as the first neutral article I find is this very page. :( Infinity0 _contribs 21:23, 5 December 2005 (UTC)

Actually, the wording says "most of the MOP is privately owned/operated (usually through the employment of wage labour)" - that isn't a statement of definition, it's a statement of fact. They ARE usually operated through the employment of wage labour. Infinity0 _contribs 21:25, 5 December 2005 (UTC)

Another point - employment of wage labour is as much part of capitalism as self-profit and private MOP is. Infinity0 _contribs 21:28, 5 December 2005 (UTC)

And about commodities. Commodity states:

In the world of business, a commodity is an undifferentiated product whose market value arises from the owner's right to sell rather than the right to use. Example commodities from the financial world include oil (sold by the barrel), electricity, wheat, bulk chemicals such as sulfuric acid, base and other metals, and even pork-bellies and orange juice. More modern commodities include bandwidth, RAM chips and (experimentally) computer processor cycles, and negative commodity units like emissions credits.

Now, I think, just MAYBE, that bandwidth isn't a physical object? Infinity0 _contribs 21:31, 5 December 2005 (UTC)

Of course bandwidth is physical. Electricity is based in transfer of electrons and it moves over wires (bandwidth). A service is not considered a commodity in economics. A commodity is everything that is bought and sold other than a service --other than labor. RJII 21:37, 5 December 2005 (UTC)

I suppose, I get it. A service is a verb, and commodities are nouns. But I still think the link to commodity should be put somewhere, though. Infinity0 21:40, 5 December 2005 (UTC)

How about "commodities and services" then? RJII 21:45, 5 December 2005 (UTC)

Sounds good. I'll do that. Infinity0 21:53, 5 December 2005 (UTC)

I do not think RJII understands what bandwidth is, at least not as commonly understood. Bandwidth refers not to "wires" but to the numerical difference between the upper and lower frequencies of a band of electromagnetic radiation, especially an assigned range of radio frequencies. The FCC often auctions these off. They are not selling (or renting) actual electrons, nor the media (copper wires, fiber optics) through which electrons move. They are selling the right to broadcast on a certain range of frequencies. InfinityO is quite right that bandwidth is not physical. Slrubenstein | Talk 22:08, 5 December 2005 (UTC)

That's one thing "bandwidth" means, but another (which was the definition I took it to mean) is the amount of data a web server (or whatever) transfers, in which case RJII did describe it correctly as electron transfer. Infinity0 22:34, 5 December 2005 (UTC)

Moreover, if electricity is physical, so is "labor." Labor is the flow of electrochemicals across brain synapses, and the contraction of muscles, both very physical material things. Once again, Infinity), you are correct. Slrubenstein | Talk 22:08, 5 December 2005 (UTC)

I just thought about it a bit more, and I understand that commodities don't have to be physical things. However, I do still agree with RJII that a service is distinct from a commodity. That is, you can re-sell a commodity, but you can't re-sell a service :) (Yes, you can resell bandwidth, it's called web-hosting :P) Infinity0 22:18, 5 December 2005 (UTC)

Infinity0, "service," the way it is used in the intro is not a verb, it is a noun. Moreover, "economics" is one point of view. NPOV demands that we provide other points of view. Plenty of sociologists and other social scientists have written about the commoditization of labor. Those views should be represented in this article as well. If economists and other social scientists argoe over this, NPOV requires that we state that they argue (or disagree) over this, and provide an account of the disagreement. Slrubenstein | Talk 22:08, 5 December 2005 (UTC)

Yes, but I didn't agree that labour was a service, just that services aren't commodities. :) Anyhow, commodity is still in the introduction. Obviously, information about the debate on labour shouldn't be in the intro, which at the moment I think is fine. However, it does need to be added to the article somewhere, but I don't have time to write something properly right now, nor am I an expert on that matter. Infinity0 22:15, 5 December 2005 (UTC)

And by "verb" what I really meant was "noun of action". You can't sell a verb :p Infinity0 22:21, 5 December 2005 (UTC)

Capitalism is not just based on selling commodities, it involves renting them too. More important however is the claim that many people make that capitalism comes into existence when labor-power is commoditized. Many people do not agree with this definition, but many people do. NPOV requires representing all views. Slrubenstein | Talk 23:00, 5 December 2005 (UTC)

Whatever. RJII 01:06, 6 December 2005 (UTC)

Definitions

I actually think there should be a separate series for Captalism vs. Socialism vs. Free Market vs. Command Economy vs. Planned Economy vs. Decentralized Economies vs. Mixed Economies, as their definitions are somewhat intertwined.

I got out my econ notes from a while back, I'm basically checking the definitions, if this changes the article, or if someone wants to correct me, go ahead and correct:

There are two different ways to catergorize an economy into two.

Little Regulation Heavy Regulation

and

Low Government Expenditure High Government Expenditure

Heavy regulation AND high government expenditure are command economies, heavily regulated economies are planned (price wages enforced by the Nazis for example (although I didn't mean the example to be so extreme)), little regulation is decentralized, low government expenditure is capitalist, high government expenditure is socialist, and free market is both low government expenditure and little regulation.

Note that these are very subjective, and are not as simple as saying "Above 50% government expenditure as a portion of the GDP is socialist," because France has above 50% government expenditure as a portion of GDP and some people refer to it as Capitalist and some as Socialist. Similarly the argument goes for little and heavy regulation, some may say that the U.S. is decentralized while others are extreme enough to say it's a planned economy, the difference in opinion comes from the subjectivity of the two terms (I, for example, say that the U.S. is a planned economy because I'm pissed off and opposed to the regulations on power companies; but that's my opinion). China considers itself Socialist, while many other consider it Capitalist. Some consider the Soviet Union Capitalist because of it's Black Market activities. And so on.

In other words:

Little Regulation AND low government expenditure=Free Market Economy

Little Regulation=Decentralized Heavy Regulation=Planned

and

Low Government Expenditure=Capitalist High Government Expenditure=Socialist

High government Expenditure AND heavy Regulation=Command Economy

And a mixed economy is any economy that is thought of as a mix between socialist and Capitalist, technically this is all countries, but it is also a subjective factor (Subjective in that the percentiles aren't really placed, it's not like below 10% government expenditure is Capitlist, from 10-90 is mixed, and Socialist is >90). Fephisto 16:19, 6 December 2005 (UTC)

Contrast with other economic systems

Here are a few interesting facts:

"Corporatism" gets 798,000 Google hits. "Syndicalism" gets 256,000 Google hits. "Gift economy" gets 178,000 Google hits. "Participatory economics" gets 57,900 Google hits.

By way of comparison, "economic fascism" gets a mere 13,600 Google hits. Why, then, does a certain editor insist on contrasting capitalism with "economic fascism" (which is a controversial term to begin with) as opposed to any of the above mentioned economic systems? Certainly, capitalism could be contrasted with any other economic system, but, in an introductory paragraph, we should limit ourselves to the most notable. -- Mihnea Tudoreanu 07:27, 9 December 2005 (UTC)

OK, I changed it... though you could have done that yourself... Infinity0 17:02, 9 December 2005 (UTC)

I tried, but I kept being reverted. -- Mihnea Tudoreanu 20:28, 10 December 2005 (UTC)

Another dispute seems to have developed around the definition of feudalism. The old definition, supported by User:RJII, is as follows:

Capitalism is contrasted with feudalism, where a ruler claims ownership of the land of private operators, and then grants titles to feudal lords who collect rent from the operators. In capitalist theory, land may only come to be owned by trade or gift, or in the case of unowned land by putting it to use (e.g. cultivating it or homesteading).

There are several problems with this. First of all, how does a ruler "claim ownership of the land of private operators"? The sentence seems to be suggesting that first the operators start using the land, then a ruler claims ownership of it. This was not necessarily the case, and it is not clear who the "operators" are (if you mean peasants, then say peasants). Second, there is no single "capitalist theory". The economic system of capitalism is supported by several ideologies, each with its own separate theory. I daresay that the majority of supporters of capitalism would not agree with a theory which implies - among other things - that the territory of the United States should be given back to the Native Americans. The replacement definition I propose is the following:

Capitalism is contrasted with feudalism, where a monarch holds both law-making power and ownership over the land in a certain area, and delegates these to vassals in exchange for various services.

Do you object to it, RJII? -- Mihnea Tudoreanu 02:26, 12 December 2005 (UTC)

Yes I object to it. You can't explain the essential differences between capitalism and feudalism without noting the differences between the two systems in regard to how property comes about and how ownership is tranferred. In feudalism, the State (or monarch) simply comes in and claims ownership of all the land --any existing owners are decreed to no longer own the land. Then, the State grants title to fuedal lords who allow individuals to use and work the land, but not have ownership rights (note that ownership rights includes the right to sell your property). In capitalism, title can't change hands unless its by sale or gift (i.e. there's a free market). In capitalism, an individual can't just come in and claim that he owns all the land then grant title to whomever he pleases --he has to purchase land to obtain title. RJII 02:57, 12 December 2005 (UTC)

Your definition of feudalism is an anachronism. First of all, property and ownership rights under feudalism were not the same as under capitalism. Second, what is "the State"? An organization with a monopoly over the legitimate use of force? But wait - feudal monarchs did not have a monopoly over the use of force. Third, capitalism says nothing about how property "comes about". In Europe, the transition to capitalism involved either feudal aristocrats selling off their land, or the state confiscating that land and distributing it to individual peasants. Both processes were based on individuals or groups coming in and claiming that they own all the land then grant title to whomever they pleased. In America, much of the land was confiscated from natives. Capitalism has not been established anywhere from scratch through voluntary means. -- Mihnea Tudoreanu 03:32, 12 December 2005 (UTC)

"Capitalism has not been established anywhere from scratch through voluntary means." Duh. Is that supposed to be a revelation? In capitalism, property only changes hand by sale or gift. How any particular capitalist system came into being, or even whether or not any capitalist system even exists today is irrelvant. Note the name of the section: "Capitalist theory." This has nothing to do with the real world. RJII 03:45, 12 December 2005 (UTC)

Ummm, the thing is, property only changed hand by sale or gift in feudalism too. And in socialism, for that matter. Confiscation was involved in the creation of the system - just as it was involved in the creation of capitalism - but not in its continual operation. -- Mihnea Tudoreanu 03:59, 12 December 2005 (UTC)

If ownership was seized by a monarch then granted to a Lord, that's not capitalism. In capitalism, a "monarch" would purchase the land. RJII 04:14, 12 December 2005 (UTC)

Ok, so a monarch seizing ownership from peasants is not capitalism, but a European settler seizing ownership of land from Native Americans is capitalism? Again, you do not seem to understand that for the purpose of a definition, it is irrelevant how X economic system came about. Of course feudalism is not capitalism. But the reason does not lie in how feudalism came about. -- Mihnea Tudoreanu 04:22, 12 December 2005 (UTC)

If a monarch siezing ownership from peasants is not capitalism, then why would a European settler seizing ownership of land from Native Americans be capitalism? Of course, neither is capitalism. Ok, let's say it's irrelevant how capitalism comes about. The fact is, seizing land rather than purchasing it, is not consistent with capitalism. RJII 04:25, 12 December 2005 (UTC)

That's a particular libertarian view that is not shared by all advocates of capitalism (see conservatism, liberalism, and so on). In any case, it is controversial. Why base our comparisons between capitalism and feudalism on controversial matters when we can base them on non-controversial ones? Feudalism isn't the only system where a ruler can seize land anyway, so it is a bad idea to define feudalism based on that particular aspect. -- Mihnea Tudoreanu 04:34, 12 December 2005 (UTC)

A "libertarian view"? What the hell? Capitalism is a libertarian system by definition (laissez-faire and free market). There is nothing controversial about the fact that in capitalism that property exchanges hand by trade rather than by seizure. RJII 04:38, 12 December 2005 (UTC)

Capitalism is not the exclusive domain of libertarians. Or any ideology, for that matter. Libertarians do not "own" capitalism, and the majority of self-proclaimed advocates of capitalism do not go as far as laissez-faire. But this is off-topic. Going back to the issue at hand, my point was that capitalism is not the only system in which property exchanges hand by trade rather than by seizure. The same happens in feudalism, socialism, communism, etc. Seizure may be involved in the setting up of those economic systems, but it is not involved in their continual existence. I have attempted to provide a better contrast between capitalism and feudalism in the article. Please read it. -- Mihnea Tudoreanu 04:49, 12 December 2005 (UTC)

Of course capitalism is the exclusive domain of libertarians. Economic libertarians are the ONLY ones who advocate capitalism as defined: ": an economic system characterized by private or corporation ownership of capital goods, by investments that are determined by private decision rather than by state control, and by prices, production, and the distribution of goods that are determined mainly in a free market" (Merrian Webster Third International Unabridged). That by definition is economic libertarianism. Capitalism *IS* a libertarian system. A "free market" IS libertarian --meaning that there is no initiatory coercion. Voluntary trade IS libertarian. RJII 04:54, 12 December 2005 (UTC)

Both capitalism and the free market pre-date libertarianism by over a century, and libertarians hold absolutist views that may be described as extreme capitalism. But I have no desire to argue with you now over your dogma. At least we seem to have reached consensus over the text in the article, and that is what matters here. -- Mihnea Tudoreanu 05:00, 12 December 2005 (UTC)

What?? The idea of a free market CAN'T predate libertarianism. A free market IS a libertarian system. Also, you don't have to be an extremist to be a libertarian. If that were the case, then the only libertarians would be anarcho-capitalists. Even Thomas Jefferson was a libertarian: "rightful liberty is unobstructed action according to our will within limits drawn around us by the equal rights of others." It's indisputable that that's the essential tenet libertarianism. I think you may be confusing the inception of the term, with the inception of the philosophy. Philosophy that opposes initiatory coercion has been around long before the term "libertarianism" was applied to it. RJII 05:06, 12 December 2005 (UTC)

Also, someone is taking out the fact that it's not just the means of production that is collectivized in communism but also the produce of labor. Private property is eliminated in communism. For example, "The Italian Federation considers the collective property of the products of labour as the necessary complement to the collectivist programme, the aid of all for the satisfaction of the needs of each being the only rule of production and consumption which corresponds to the principle of solidarity..." In communism, there is no wages and no market --there can't be because there is no private property to trade. RJII 03:13, 12 December 2005 (UTC)

Cite sources

RJII, you just added a comment that in communist societies the produce of labor is shared and not traded. What is your source for this? Please provide a verifiable source. Slrubenstein | Talk 18:49, 13 December 2005 (UTC)

Are you serious? You didn't know that communism seeks to eliminate exchange value? If the produce of labor is collectivized ( for example, "The Italian Federation considers the collective property of the products of labour as the necessary complement to the collectivist programme, the aid of all for the satisfaction of the needs of each being the only rule of production and consumption which corresponds to the principle of solidarity."), then you can't trade it. You can only trade what which belongs to you --your private property. Merriam-Webster: "1 a : a theory advocating elimination of private property b : a system in which goods are owned in common and are available to all as needed." In communism, goods have no exchange value --they're simply distributed based on need. This method is also called gift economy. Communism is definitely not a market economy. RJII 18:58, 13 December 2005 (UTC)

Don't get hysterical. I was not challenging the truthfulness of what you wrote, I was only asking you to comply with our policy to cite sources. I do not consider a dictionary to be a good source, it's like copying an article from another encyclopedia — we are here to write our own encyclopedia. Good sources would be books or articles about the history of communist thought or actual communist societies. You mention the Italian Federation — that was only one faction, certainly not in the majority, at the First International. If this is your only source, then you cannot say "In Communism ..." you would have to say "In the Italian Federation's interpretation of (or vision of) communism." And what is your source for that, anyway? yes, I know it is in another article, but that article makes it very clear that this was one faction of "anarcho-communists" at a conference. This is not at all the same thing as making a general claim about communism. Please provide a verifiable source that suppports your claim. Or, modify the claim based on a verifiable source. That is all I am asking for. Slrubenstein | Talk 20:22, 13 December 2005 (UTC)

I gave you verifiable sources. "I was not challenging the truthfulness of what you wrote, I was only asking you to comply with our policy to cite sources." What kind of crap is that? In other words, you're trying to find amunition to use against me in the RFC or to file another bogus arbitration case like you did awhile back, which you lost. Everything on Misplaced Pages doesn't need to be sourced. It merely needs to be sourceABLE. You say you don't dispute the truthfulness, therefore you would be highly unethical to remove the claim wouldn't you? What are you going to now? How you are you going to rescue your credibility? RJII 20:38, 13 December 2005 (UTC)

What was your source? A definition from a dictionary? That is not a scholarly source. If you haven't done the research, then don't add the claim. Provide a serious source. Slrubenstein | Talk 00:13, 14 December 2005 (UTC)

collectivization of property is the elimination of private property (individual property) - RJII, Marx never says anything about individual property, quote:

• Hard-won, self-acquired, self-earned property! Do you mean the property of the petty artisan and of the small peasant, a form of property that preceded the bourgeois form? There is no need to abolish that; the development of industry has to a great extent already destroyed it, and is still destroying it daily.

Also there was no need to add the quotes around based on "need", to try to belittle that concept. I do feel that Slrubenstein is being too picky here, but you really didn't help to make him act any more lenient towards you. Infinity0 01:14, 14 December 2005 (UTC)

That's Marxism (capital C communism). Nevertheless, the Manifest says straight out: "In this sense, the theory of the Communists may be summed up in the single sentence: Abolition of private property." RJII 03:19, 14 December 2005 (UTC)

Infinity, thank you for doing what we at Misplaced Pages call "research" and actually drawing on a meaningful source. However, I want to point out a few things concerning claims about communism: First, Marx's communism was theoretical, and — however important his and Engel's theories and hopes — was never put into practice. Second, there were before and after Marx and Engels other theories of communism, and any claims about "communism" should represent them, and not only Marx. Third, although there have been no communist states, there have been functioning communist communities; these provide empirical data on how a communist economy can function, and should also be taken into account in any claim about "communism." From these three facts arise two conclusions: (1) it may be hard to define or formulate one general model of "communism," and (2) an account or explanation of "communism" needs to be based on research into each of these areas. Slrubenstein | Talk 03:12, 14 December 2005 (UTC)

slrubenstein, you just stated in the article that in communism an "individual" can own the means of production. That's absolutely ludicrous. Time for you to provide a source. I'll even accept a children's dictionary. RJII 03:36, 14 December 2005 (UTC)