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Old December 13 2012, 09:00 AM   #26
Location: Kentucky
Re: Scientist declares “Earth is F**ked" --Discuss?!

newtype_alpha wrote: View Post
So now socialism is what happens when capitalists deny other people their property rights?
Yes, for the people denied property rights it largely is. However, they don't require capitalists to deny themselves property rights, and the pre-revolutionary Russian serfs maintained a system very much like that, where each village would re-decide which families got to work which plots of land, based on how many children they had, etc, all in the name of fairness and efficiency. The result was the poorest class of people north of Africa, because nobody would make any improvements on the land (since someone else might get the same plots next year), and the plots weren't even contiguous. They could give you a dozen narrow strips that were far apart from each other, so you spent half your day moving from one to the other. But the land and resources were allocated fairly!

With all due respect, no you don't. You know people who very cleverly and successfully used the resources they had to start major companies. Even people who use their home equity or family and friends to gain startup capital are doing the very same thing, borrowing money from banks or acquaintances using their own property or good will as collateral. It's the cost of doing business, and you can't GO into business without something solid to back you up.
Oh, you can go into business with nothing to back you up, and Mexicans and poor people do it all the time. You can't do it as easily in some states, like California that requires about 13 agencies to approve a license to run a barber shop, but most have very few, if any, requirements.

One of the funnier situations I have to deal with is a conveyor/automation company now called Intelligrated. For decades a major holding company out of the UK called FKI had bought up all sorts of conveyor companies (Mathews, White, Kosan, and I think Litton), building itself into a multi-billion dollar operation, one of the major players (along with Seimens, Rapistan, and a few others). They fired a bunch of engineers from one of the firms they acquired (a common occurance) and the engineers started a small controls house (maybe 10 or so guys). FKI's stock tanked due to brutal competition among the big players, and this small group of engineers bought them lock, stock, and barrel for less money than the average conveyor job, then turned around and fired the people that had fired them.

To be blunt, just because your grandmother gives you twenty dollars to start a lemonade stand doesn't make her a venture capitalist.
It does if she's successful at it. The problem with the lemonade industry is that Clinton's anti-trust division never went after the little red wagon monopoly held by Radio Flyer, who now charge hundreds of dollars for any type of off-road heavy-duty wagon, making it almost impossible for children to pay back their investors in a reasonable time frame, since amortization of the wagon doesn't really kick in until they're almost in college.

My family started with a couple thousand dollars and some donated equipment. We've now been in business continuously for thirty years and are bigger than we've ever been. Since then, my mother and my sister have gone on to start four successful businesses and we're looking at starting a new one in the near future.

We are NOT members of the investor class. We do not have the kind of economic power to realistically engage in venture capitalism. This is so, because while you don't need millions to start a business, you do need millions to BUY ONE OUTRIGHT, or even to buy a meaningful portion of one.
But you never know when you're going to see an opportunity, just like the fired engineers who bought FKI for about $10 million with a bank loan. Occassionally major companies have their value plummet almost to nothing, and nobody will buy them because of the debt loads they carry. A decade or so ago Chrysler, one of the big three US auto companies, what snapped up for something close to the cost of a few used Boeings.

But most of the activity in our economy remains at a much smaller scale, and it is (or was), profitable. You seem to be focused on the ultra-rich, when capitalism doesn't actually need or require them to thrive. As Hernando De Soto points out, the third world is populated by brilliant capitalists working within and around a rule system that's not designed to promote capitalism. Their taco vendors will spend as much time and analysis picking a location on the sidewalk as Yum brands uses to site a new KFC or Taco Bell, observing traffic patterns, meeting with other vendors to discuss options and how they'll carve up territories, gaging customer traffic, flow rates, and other factors. They do all this even though legally none of them can run a food cart.

Why should that surprise you? The ownership class in Latin America doesn't need anyone's permission either.
And that's the issue. Latin America has an ownership class, whereas in the US anyone can own almost anything - legally. Latin America was structured by very rich families intent on keeping the peasants as peasants, thinking there was a natural, top-down order to society (a very traditional Catholic idea from Spain). Their ruling families left Spain to rule, whereas the few ruling-class English the King did manage to convince to come to their colonies left when things went belly up for them. For a time George Washington was an apprentice/errand boy for an actual rich Englishmen, but even the richest rebels we had would've been thrid or fourth rate nobodies in London, and they didn't have the means to keep Americans in check, much less control us.

Washington ended up in a series of lawsuits trying to throw some penniless nobodies off land he'd claimed, and he got nowhere at it. He won the case, so they just walked off his property, rendering it even more worthless than it was before. The capitalist rule system we have wasn't introduced by the "investor class", it was invented by dirt-poor settlers who imposed it on the investor class. With poor people in charge, and no power structure to contend with, we built our business laws on the rules of the black market, rules that poor people had used for ages, which are intuitive and functional and most importantly serve the interests of those who use them.

These rules involve fair exchanges, contracts, deeds, squatting, and a host of other common activities. You use them daily, and that rule system lets you own legal title to your house, your car, and your possessions, and use them as collateral for bank loans, personal loans, gambling, and whatever else you want to do. In most of the third world you cannot legally own your house, because it belongs to one of the "investor class" families since 1600 or so, on a land grant from the king of Spain. Their ruling families have structured things so you can't legally own a business unless you legally own the property where it sits, and you often can't legally own a car unless you legally own a place to live, and on down the line. So the chief business law they live by is "don't attract attention" and "don't make waves."

They can't stick their money in a bank because it will get reported and possibly seized, claimed as drug income or some other nonsense because they don't run a legal business because they don't have a business license (which they can't get), so they can be prosecuted for proving they run a real business. As you dig into their situation, they probably have power run illegally to their house, because they couldn't prove they own the house (and so a power company wouldn't eat the expense of running copper unless they could seize the house or put a lien on it, which they can't because they can't prove that the person who conned them into running power was the actual property owner).

The situation compounds, but basically there are so many ways that everyone is skating around the law that nobody is in a position to fight the system and get property rights and establish a system that recognizes those rights, and the only people who do fight the system are convinced that eliminating property rights is the way forward. That leads to the Russian peasant problem, where your property rights are always transitory and contigent, and that path leads to abject poverty.

For more on this problem I suggest you read De Soto's book "The Other Path", or his book on capitlism and why it succeeded so well in the US and failed almost everywhere else (he traced our success to Frankfort, Kentucky, of all places).

Then I suppose Al Capone was one of the greatest luminaries of American socialism.
Yes, he was. Southern Italy had a host of problems meeting EU standards, such as their almost astronomical disability rates. Upon investigation, it turned out that the Mafia operates as an illegal socialist system, surviving not by their actions as thugs, but by their actions of helping families and poor people by getting them government benefits in return for silence and special favors. Basically, they'll prove that your back is out or your grandmother needs a fancy cart if you'll work in a particular bar three nights a week. They provide security and employment in return for loyalty and kickbacks.

Conversely, there's a huge number of Americans who have such a vague conception of what socialism actually is that they tend to describe it as "anything that is bad for people/business owners/the economy."
Did you ever think that maybe they have a vague idea because "socialism" is such a vague idea, encompassing everything from Nazism, Communism, and Fascism (whose end states were socialism) to Baptist church picnics?

Except that they did such a piss poor job in managing Iraq's reconstruction, I might agree. It's worth pointing out that being an effective bureaucrat and being an effective problem solver are NOT AT ALL the same thing, and running a business requires a lot more of the latter than the former.
They had problems they'd never faced before, such as the complete inability of any Iraqi to say "no, we can't do that." It took them about a year and a lot of screaming to get an Iraqi to admit that whatever group or "company" he represented couldn't do a particular job. It might be that such admissions were punished with death under the old regime, or it might be that part of their culture was to never admit you can't do something. Probably both.

A top-down command structure was so ingrained in them that we had all sorts of problems, such as trying to convince sergeants that they could shoot at a target without orders from someone on high, including their tank commanders. We would set up training excersizes and they wouldn't just engage the hypothetical enemy like we do. Our training problem is that Americans will blast anything. They grew up in fear, and were afraid of doing anything without permission, even if it meant death, tactically, because dying on the battlefield for not acting isnt nearly as bad as getting your whole family executed because you showed initiative. This carried over to business, and our screw up was purging all the Ba'athists, which though powermad, did have initiative.

In case you didn't notice, the military not only engages in very detailed business contracts all the time, they even audit the contractors.
So let's recap. According to you:

Extortion is actually socialism
Oligarchy is actually socialism
Poor people are investors
The military is a business
Yep, that's pretty much it. Socialism cannot work without extortion, because why would someone give up the rights to something they made or own without extortion?

Capitalism is simple. If you make it, you own it, unless you were paid to make it for someone else. If you want more stuff, make more stuff. If the stuff you make isn't the stuff you want, trade it.

Socialism is equally simple. If someone else made something, claim it as your orwn. If they won't give it to you then convince enough people that the person producing all the cool stuff isn't being fair, so that the village will produce enought thugs to pressure him to give it to you.

The end states are also simple. Under capitalism, everyone wants more stuff so the produce more and more stuff. This causes the price of stuff to plummet, so they have to innovate to produce even more stuff from less.

Under socialism, people intimidate anyone producing stuff and the stuff-producers give up and hide, leading to a stuff shortage. The "allocaters" who decide who deserves what then become critically important, as does any remaining stuff that can be allocated. People end up at war over who choses who gets to allocate the last clay pot, because the people's survival hinges on it.

One system is rewarding the production of more and more stuff, and one is punishing it. One society ends up drowning in stuff (iPhones, cars, movies, beer, exotic pets), and one ends up paying workers with boxes of rubber dildos (bizarre, but true and a fitting epitaph of socialism).

Gorbachev said one of the big mistakes the Soviets made was running a huge propaganda campaign saying that the unfairness of the capitalist system was forcing the elderly in the US to eat cat food (I remember that one). What he says did them in was that by that point in socialist utopian advancement, the psychological and hushed response was "In the West, they make food just for cats!!!!.

Libya was as socialist as socialists get. A few years before Quadaffi fell Michael Totten wrote a long series of articles about his visit there. Syria is likewise socialist. Both were modeled somewhat on Nazi Germany, which was socialist.
Nazi Germany -- like Syria and Libya -- was fascist, not socialist; those are two entirely different things.
Nazi Germany was not remotely Fascist. Fascists were stauncly anti-racist. Mussolini had a long string of Jewish girlfriends and was pointedly anti-socialist, though all he knew was socialism, having been the editor of the Italian socialist party newspaper as his only real job aside from being a Marxist propagandist and agitator, which got him thrown out of Switzerland.

Mussolini hid his socialist past, denouncing it as flawed compared to his third way path (like Chavez, whose family will probaby face copyright lawsuits by Mussolini's family). The Nazis were proud socialists, and if you dared question their commitment to socialism they would shoot you if you were in range, or get on the radio and denounce you if you weren't. If you search the archive of Nazi propaganda (maintained by some nice US university), you can read their vociferous corrections to confusion between their nationalism and their socialism. Nationalism was their foreign policy, socialism was both their domestic policy and their goal for the rest of the world.
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