# Capitalism is freedom?

Discussion in 'Politics' started by shichimenshyo, Dec 29, 2009.

1. ### NorsefireSalam Shalom SalomRegistered Senior Member

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The thing is, under a libertarian establishment, all could be happy; people in favor of community ownership and egalitarianism are free to live amongst each other, and voluntarily enter into contracts with only their own property and themselves, and live well without affecting others.

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3. ### iceauraValued Senior Member

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Bill Gates owes me lots of money, for wasting my time dealing with his horseshit operating system.

Thew least we can do is tax him to pay for the public schools, and the military.

Yep, that's more like it. So let's drop this nonsense about taking from the rich and giving to the poor, OK?
They can go make money in Haiti with their own efforts, then - around here we have roads and sewers and schools to pay for, and they can't expect to use them for making their fortune without paying for them, right?

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5. ### NorsefireSalam Shalom SalomRegistered Senior Member

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You bought it

Okay, 1% sounds good, since he's already contributed in through business he doesn't have to contribute much in taxes.

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7. ### Try AgainNo, I'm not a mod.Registered Senior Member

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It's true, Bill Gates has helped the United States. People are angry because he had a great idea before they did. You might not like PC as much as Mac, but it nonetheless is a great accomplishment. He deserves the money that he earned.

8. ### iceauraValued Senior Member

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No, I didn't.
He's been paid for his "business" contribution, several times over. He nwo has to pay for the infrastructure of the economy and society he used - our fees for the legal system that protected his intellectual property and defended his monopoly status, for example, should be substantial - say 15% of the gross? He relies on that fro every nickel of profit he makes.
A lousy computer operating system that creates a permanent inefficiency dragging down the entire economy for decades, to the profit of its developer - is that the great idea? Or did you have another in mind?

9. ### NorsefireSalam Shalom SalomRegistered Senior Member

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Then why are you complaining about Microsoft if you don't use their services?

Don't forget you never offered him any other option but to use your services; thus that renders the transaction between you and Bill Gates rather less legitimate. Although, if we are to charge him, we'll have to closely follow all the roads he uses, how much wear he causes on them, and how much he, himself, uses of the infrastructure. And then I highly doubt 15% is good; that's far too much. He is only one person out of three hundred million; how much wear can he himself cause? Let's tax him $3,000 a year. That sounds enough for the services he uses. 10. ### iceauraValued Senior Member Messages: 30,994 I do "use their services". They are unavoidable - what used to be called a monopoly, when permitted to private interests. He has been free to move anywhere in the world, from his adulthood if not long before - I have never stood in his way. It's far too little, for such a critical and valuable service provided up front. And besides, if he doesn't want to pay the going rates for his very significant and critical employment of almost all facets of the US legal and economic system, he can refuse and take his operations elsewhere. They are all paying their share, too - their percentage of their take, from the services they used. 11. ### NorsefireSalam Shalom SalomRegistered Senior Member Messages: 11,529 Oh no, first you have to explain why YOU have a monopoly on the geographic territory and have the right, in the first place, to demand payment from him. I doubt it. I drive on the roads, and I haven't broken one yet; and that's about as far as it goes for him, since he doesn't use many public services.$3000 per year sounds good for the roads for what he uses.

Again, first you must explain why you have the right to demand payment from him.

Good, though by your logic, since the poor use more public services than the rich, they must pay more. Well, okay.

So Bill Gates, since he uses very few public services, should pay very little in taxes

12. ### iceauraValued Senior Member

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30,994
We're the government here, the entity that provided the services (up front, on a consignment basis as you might say) in this geographic area.
They don't.

And that's not the deal anyway - we charge a percentage of the take, rather than a flat fee for the use. That's how a lot intellectual property and services, and similarly provided goods and services, is billed.
His use of the legal infrastructure surrounding his "intellectual property", alone and ongoing, is worth at least 15% of his gross business earnings.

13. ### PandaemoniValued Senior Member

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Ever hear of linux? We are all free to use it. And plenty of people use Macs. Microsoft is not monopoly in the strict sense, Granted that that have a dominant position, but that is not because capitalism is inefficient...quite opposite. They have their position because their system is reasonably good and because it is the sort of product where having a common platform is helpful. It's like Blu-Ray winning the HD format war, the inefficiency dragging the market down is too much competition by people hawing incompatible formats.

It's simply more efficient for people to have a reasonable operating system in common, than the best operating system for their personal needs, but no standardization.

Personally, I thing freedom leads to capitalism more than the reverse. Feudal power started to dissolve in Europe before the rise of capitalism (think, for example, the signing of the Magna Carta), and in fact feudalism gave way to mercantilism before making it to capitalism.

14. ### NorsefireSalam Shalom SalomRegistered Senior Member

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Finally you aren't arguing against the free market. Good to see.

15. ### PastaRegistered Senior Member

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I think Capitalism is an outgrowth of freedom, where people can develope their ideas, sell them, and use profits to improve their ideas further.

I would rather live in a free capitalist society instead of one where the government controlled everything and we didn't have choices because of that.

16. ### PandaemoniValued Senior Member

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I love the free market, where the free market works, but a free market isn't the same thing as a competitive market, and a competitive market is way better than a free market, if the economics isn't allowing you to have both at the same time.

Capitalism is great because it is the first step in getting us as close to a "perfect market" as we can get, but that should be the goal. "Free markets are good insofar as they are generally closer to that goal than controlled markets, but the devil is in the details. Good regulation is better than bad regulation, and good regulation is very often superior to "no regulation."

The very concept of a free market is somewhat of any oxymoron, since it itr supposed to exist without regulation, yet requires (usually governmental) enforcement of contracts and property rights. A free market, like a free lunch, isn't really free.

All that said, if somebody makes a very useful product, everyone may buy it, and that businmess could come to have a monopoly. That isn't in and of itself evidence of inefficiency, sometimes natural monopolies arise because that is what is most efficient. Operating sustems seem to be in that category.

17. ### ScaryMonsterI’m the whispered word.Valued Senior Member

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Not after Vista!

18. ### iceauraValued Senior Member

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30,994
No one forces me to use linux or Mac OS in the course of my daily affairs.

The ability to coerce users, to hold ordinary business hostage to one product, is the strict definition of monopoly. Usually it's identified as a certain percentage of the market, which varies by business - but Microsoft definitely qualifies.

On the contrary - it is exactly because market capitalism is inherently vulnerable to legacy inefficiency, due to its inability to transcend a local sub-optimal equilibrium, that Microsoft could entrench itself. We got stuck with Microsoft almost exactly the way we got stuck with the standard typewriter-derived keyboard.
It was exactly not like the Blu-Ray decision. The Blu-Ray decision was a political one - a trade group decision, involving deliberate discussion and reasoning among the major format consumers.

And that's what you need in situations like that - depending on "the market" to install better "common platforms" simply doesn't work, for well known game theoretic and well illustrated, historically, reasons.

That's how suboptimal equilibria, lousy common platforms, are enforced, and why market forces in capitalist economy will not free you from them.

19. ### PandaemoniValued Senior Member

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EXACTLY (although the story about the qwerty keyboard being purposefully inefficient is a myth...and you can convert your keyboard to Dvorak or whatever at any time, computer keyboards are very good about that). Now please find me the "keyboard monopoly" or bad apples that coerced us into that. You also forgot VHS defeating Betamax, a victory that was won mostly because porn went to VHS, and it makes more sense to buy a machine with broad compatibility than one with limited compatibility and superior features.

That is not "suboptimal" though unless you live in a world without transaction costs. In fact, it's just "economics" that the costs of not only switching, but in switching and maintaining system-wide compatibility would be prohibitively expensive.

The real optimal solution will be one that accounts for transaction costs, because those are very real. A hypothetical optimal solution can ignore them, hypothetically.

So cute . . . Why pick one, and worse, how dare they "force" you and me to buy the one THEY want. Maybe we prefer HD-DVD, and they certainly were not elected to set policy for us. They are encouraging a fucking monopoly by your definition, anticompetitive behavior that, if you believed your take on Microsoft was correct would be anticompetitive in clear violation of the Clayton Antitrust Act.

Actually game theory says that we do not need an industry organization to tell us which to pick, that a market of independent consumers can select on its own and will select a BETTER alternative in the absence of such a group, because that group exerts disproportionate power over the decision and yet their preferences are not representative of any "average" individual, but are peculiar to their own position.

That is what happened with Microsoft. MS DOS was a stable and powerful operating system for PCs. There were others that I can remember, and they all had issues. MS DOS's issue was that it was confusing to people who did not understand it, and even that was a plus for some of us who did understand it (because we were able to feel smarter than the masses).

Then what happened? Apple made a better system. Microsoft then invented Windows to copy them. By the time that had happened though, we were already committed to Microsoft, so we went along for the ride.

The problem for Microsoft is really one of just staying at or above the level where the aggravation of remaining with MS Windows is less than the costs of switching. Honestly, though, Windows is far and away above that bare minimum level. You may prefer Snow Leopard or Unix or something, but Windows is by and large perfectly functional and capable of doing all the the average person and business needs and then some. We also all benefit because software developers have a good and stable platform around which to design programs, and compatibility issues are, for Windows users very limited.

It's fun to bitch about Windows, but unless you are looking for chinks in the armor, a copy of Windows will last you years with the worst problem you face being a crash or two and having to reboot. They are not bleeding anyone dry forcing us to "subscribe" to the Windows service (and there's no reason they could not try that).

For all their monopoly power (and by the way the definition of a monopoly is an industry that has one and only one producer, an "oligopoly" is one that has few, but more than one producer, including "dominant firm model" oligopolies), they don't abuse it much, and the sole complain you have is that everyone should be forced to use the operating system that is selected based on features (most of which Windows has).

It seems to me you are just unhappy because our operating system of choice was chosen by the market rather than a collection of "experts". I also suspect that perhaps you view transaction costs not as a fact of life, but as a serious market flaw. They really aren't. They do reduce efficiency, but they are a fact of existence. It would be nice if we did not have to eat food to survive, but it is not an market failure that we do.

Even going back to the Blu-Ray example, let's say you are right and Blue ray won solely because of an unelected cadre of elites made a decision on behalf of the market as a whole. Suppose a new format came out tomorrow that was even better? Could the elites force a new change if they wanted to? No. They'd fail, because people are all out there now buying their PS3s, other blu ray players and movies. We're now locked in, and transaction costs have mounted enough to provide resistance to any new change. The elites in that case could give us a less democratic way of selecting the winner (yay?) buy the fundamental problem is back. We're stuck with that format for at least a few years.

Could a better operating system be designed by an industry collective? Yes, but would that collective provide the levels of ongoing support and updates that an operating system needs? That is less certain. Building a Blu Ray player is easy. You never have to update its software, and no one is trying to hack your Blu Ray to steal your credit card information. It's useful to have one company on the hook for providing those services, and they are going to want rewards to compensate them for all the risks of being in that position.

A loose alliance of profit motivated companies acting in concert to produce a specific market outcome is sometimes called "collusion", so I am surprised you hold that up as the model of good economics.

Microsoft is more akin to a natural monopoly than a coercive monopoly, and like a natural monopoly they really only need some basic regulation and then our thanks, and our thanks, for producing a reasonably good product even without all the oversight and regulation.

20. ### iceauraValued Senior Member

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30,994
My point was that a "free market" coerced us into that, and it sucks.
It is suboptimal. It is a lousy setup. We are trapped in it by market forces. . The only way to have prevented the screwup would have been through non-market, foresighted, political decision and policy. That is also the only escape. it is probably too late, but there is no reason to pretend it wasn't a mistake, and a costly one.

The "consumers" of those platforms were exactly the businesses that discussed the matter. And no, game theory does not predict a better decision from a market mechanism in that circumstance - externalized costs, dominating synergy payoffs and costs, etc. The most likely result is the nearest stable equilibrium - only luck will make that the best, or even one of the good. You are as likely to get stuck with a qwerty keyboard, an internal combustion engine road-based freight setup, or the entire business world running on Windows, as any of the more efficient and profitable possibilities.
That's your idea of a good situation? That has cost us billions every year, money alone. (recall "microsoft level reliability" - where the makers of hardware for PCs only need to be reliable enough that their glitches blend in with the OS problems?).
Anyone you know make it through three years of a Windows OS with nothing but a couple of reboots? Everyone I know has at least had to repeatedly install and use a full suite of spyware and maintenance programs, add some memory and stuff, and deal with at least a couple of days of down time - usually by hiring someone to fix the thing. "The computers are down", "blue screen of death" - these are routine parts of every office worker's vernacular.

It's fun to condescend to the people struggling over the years with that piece of shit, but it costs them time and money and mental health - and the rest of us, too. And that was a market imposed suboptimal solution - a free market trap.
I'm unhappy because its a lousy system. The fact that it was chosen by a free market is just evidence that free markets aren't magic - and in some situations, like the usual "common platform" problem, they are actually inferior decision procedures: we'd be better off flipping a coin. Really.
C'mon. All I'm saying is that in certain well-described and easily recognized situations it will usually work much better than an attempt at a "free market" - and everyone who has ever laughed at the proponents of private, free market sidewalks knows what I mean.

21. ### PandaemoniValued Senior Member

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The study of actual markets shows that we are not trapped permanently by inefficient technologies, we are only trapped in the short term by them. See, e.g. http://www.nytimes.com/2010/01/12/science/12tier.html?scp=1&sq=betamax&st=cse ("'Although software is often brought up as locking in people,” Dr. Liebowitz told me, “we have made a careful examination of that issue and find that the winning products are almost always the ones thought to be better by reviewers.' When a better new product appears, he said, the challenger can take over the software market relatively quickly by comparison with other industries.")

The Dvorak keyboard, for all the mythology, has not been demonstrated to be more efficient than qwerty, just costly to switch to, and in some ways harder to learn, as 7 5 3 1 9 0 2 4 6 8 is not the way most of us remember our numbers.

22. ### iceauraValued Senior Member

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30,994
We are talking about a certain kind of fairly infrequent situation, not the statistically average sort of market decision.

The perusal of actual "common platform" problems- the ones we see in real life - shows that we are quite often trapped for generations in bad situations chosen by market decisionmaking. And there are very well known and sound reasons why that would be expected - why, say, in games like Prisoner's Dilemma, where the benefit depends on common sacrifice and foresighted renouncing of short term payoff, the market decision will steer wrong more often than right.

23. ### Thomas G FrugeRegistered Member

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The biggest lie is saying Capitalism is about Freedom. What B.S! Capitalism robs you of living freely. You can try and rationalize its need for its existence, with that B.S. but the bottom line is, it all comes down to a society built on the worst flaws of mankind, greed and selfishness and the need to control have power over land, resources other people's lives through the monetary system using money as fuel , a system that feeds the greed and selfish ambitions of individuals who don't care about other people's freedom or rights, because they profit off of the people's dependency of owners, for their wants and needs, that the people are willing to compromise their freedom and rights to become servants to the ruling class for a false sense of security, that they (the people) will be taken care of by these Private owners. By doing this we've created a ruling class, having control over our lives economically just like the Kings/ Queens. The other lie is socialism wouldn't work. Socialism would work if the people would recognize that it's their own greed, selfishness, prejudices, hate and ignorance prevents them from achieving true freedom. These things may be part of our nature, but we shouldn't let it control and prevent us from coming together, creating a world that benefit us all. But by keeping us separated and divided we are preventing ourselves from achieving it. If we only put our differences aside and used our better nature Peace, Love, respect, and caring for one another. To build what the worst of mankind's nature could not do. Have us organizing working together for the interest of the many, not the one or the few. Not putting it in the hands of the one or few to decide what's best for the rest of us., The definition of a Fascist Dictator is one who has control over land and resources, capitalizing on the wants, needs and even the hardships of the people, and exploiting the people's lives for their own personal gain of wealth and power. Which is the true definition of Capitalism. Its creating a society ruled by the wealthier class, having power over the common class. Making those that exploit the lives of the people, the ruling class, our society has become like the society ruled by Kings /Queens, Nobles landowners. The very thing we are supposed to prevent living under again, yet here we are, being taxed, the cost-of-living pricing us out of our freedom to live freely.