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Thread: Capitalism Fails

  1. #1
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    Capitalism Fails

    Been reading into this lately. Capitalism fails? What is others thoughts on this? Why does capitalism work (if you think it does?)

    Not sure how it is in other countries but IMO they NEED to CUT the full time working hours from 39 to 30 hours a week but NOT cut the wages the workers get. This will encourage these companies making millions to hire MORE staff lowering the unemployment rate and getting more people into work.

    39 hours @ $6.15 = $239.85
    30 hours to get $239.85 = $8

    When you look at the top 500 fortunes rich list for profitable businesses in 2012, it is abysmal that 50 companies earnt over $3,804,000,000 whilst staff for these companies earnt less than minimum wage.

    Thoughts

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    some reason the forum won't let me use pound signs ????????????

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    Forum Addict Dolgil's Avatar
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    Greed does not work whether it is capitalism or socialism or anything else.
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    If it's broke, fix it.
    If it's not, don't.
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    Quit making the same old mistakes. Make new ones.

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    Everything has its flaws but spreading the money across the working class is surely better that letting the rich keep it. Higher worker pay / less hours means more money down below and more people employed if these big companies want to stay open for more than 20 hours a week.

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    If you make every company hire ~30% more workers, so they pay out 30% more wages, you're going to to see a lot of companies go bankrupt real fast. The only companies that would survive are the ones that are already the largest, which are typically the most demonized in these types of discussions. This would in fact eliminate competition and result in monopolies. And then everyone loses.

    Also, people in general are greedy, rich and poor. The difference is that in capitalism you must work and provide a service to make money to satisfy that greed. Very people work for purely altruistic reasons.

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    Also curious of your assertion that the staff at fortune 500 companies make minimum wage, where did you hear that? I'm quite sure that is not true.

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    Game Support Bishop's Avatar
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    A higher minimum wage is not a solution to anything, its a complete fallacy. You'd just push up inflation.
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    Forum Addict John Snowstorm's Avatar
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    Quote Originally Posted by Bishop View Post
    A higher minimum wage is not a solution to anything, its a complete fallacy. You'd just push up inflation.
    Life before minimum wage and unions was pretty grim for the working class.

    There is something to be said for these things, there are some tricks you can do with regards inflation also.
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    "tricks" being the operative word.
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    People think capitalism works because the US continues to be a major world power while the USSR has collapsed.

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    Forum Addict John Snowstorm's Avatar
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    Quote Originally Posted by Bishop View Post
    "tricks" being the operative word.
    I mean tricks in the mathematical sense, it's not the same as the colloquial meaning.

    Do you really think that things haven't improved since the pre union, pre min wage days?

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    Do you think minimum wage is the primary driving force behind improved conditions for the poorer people in countries where it has been implemented? Or could it be because of improved living conditions from better technology.

    Anyway here is an interesting article that addresses the original question.
    http://www.nytimes.com/2012/11/04/bu...anted=all&_r=0

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    Game Support Bishop's Avatar
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    Quote Originally Posted by John Snowstorm View Post
    I mean tricks in the mathematical sense, it's not the same as the colloquial meaning.

    Do you really think that things haven't improved since the pre union, pre min wage days?

    L2History.
    Raising minimum wage by itself is a stop gap solution yet it is often touted as a being necessary for the improvement of the lower classes (i.e people on ****e wages)
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    RE: min wage

    A low min wage means people that work don't get enough money from the work to support themselves properly. This leads to some direct social costs (welfare/food stamps), some indirect costs (workers chose not to work), and some high long term costs (poor children gain less education, overworked adults can't retain, poor have worse health).

    A high minimum wage means fewer jobs near the bottom of the pile. This leads to high direct social costs (higher welfare etc.) but lower (immediate) indirect costs, and arguable lower (much smaller, but more severe) long term costs.

    Finding an appropriate balance is difficult. IMO, US federal min wage has been frozen too long, and "poverty line inflation" (I made that up) has climbed more quickly that headline inflation - together, these have significantly reduced the buying power of the fed min wage. If fed min wage is to be a functional living wage at 40 hours a week, it needs to go up, probably nearly 50%. (And then get pegged to inflation.)


    RE: reduction in working hours

    Seems there is movement towards a flexible work week within white collar jobs - not sure if it will grow or not. Reform to make regulation regarding full/part time more of a scale, with bennies being pro-rated could move towards much more flexibility for those companies that make an effort. Health care reform might actually lay some of the groundwork needed for this - any grand bargain that drops the corporate medical exemption will do massively more, though I expect that is still a third rail in the US. (Or at least will be once people know how it works - maybe we can slip it by before the masses figure it out.)


    RE: cap fails.
    It has some known failings. Like no real reason to maximize well-being of the populace. Or, IMO, even worse (long run), no reason to count external costs. It also in part depends on people being rational, which they are decidedly not - hence market panics and other such insanity. Overall, however, it is functionally a system of crowd-sourcing a great many of the decisions required to run an economy. Crowd-sourcing has inherent drawbacks, but usually not as many as single source style decision-making (communism). Especially not with corruption in play.

    Good government regulation is supposed to fix or reduce many of the problems unfettered capitalism has. As an example - consider the "carbon tax". Atmospheric carbon-dioxide increases warming of the planet, leading to major climate change. Everyone will "pay" for this, as preserving desired biomes becomes more and more expensive, sea levels rise and storms get bigger, forcing higher seawalls, and some crop lands lose effectiveness leading to higher food prices and potential starvation for many. Coal/oil/ngas production does not currently pay for any of these costs, only for those involved in actually retrieving the substance. (Which, we also lose functionally forever.) Nor does the user pay for the carbon being emitted, even though they are making all of us pay in the future. Ideally, the carbon tax taxes the production of CO2 exactly enough to balance the costs of correcting for the impact of the CO2 down the road (at whatever level we collectively deem is sufficient correction). Then I don't have to pay extra (future taxes) because you like driving a giant, inefficient car - you pay for the costs instead. It is impractical to tax each of us based on how much CO2 we produce, so most proposals say it is good enough to tax how much CO2 is going to be produced once the fuel is burned, somewhere further back up the supply chain.

    That is how it is supposed to work - of course, right now whoever can exploit the lack of external costs better "wins", and screws everyone over in the future for a quick buck now. Which is pretty fail - but IMO that is government's fault, not capitalism itself. It is like claiming gravity is at fault if you sit on a broken chain - ya, gravity is what pulled you to the floor, but it was the chair's job to stop that from happening.
    it's vs. its is ambiguous - from now on I'm attempting to use the proper possessive it's, and the contraction 'tis. (Its will just be the plural.)

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  15. #15
    Game Support Bishop's Avatar
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    You are only looking at it from the workers perspective, what do you think happens to the employers when you push their wage bill up - they pass it on to you. Now stuff costs more and your minimum wage doesn't buy you what it used to. Its a temp "fix".
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