Capitalism or Socialism choose a side and state your point

[Lazier Than Thou]

What you've pointed out is the enherent flaw of Eugenics, and why I acknolege that a "proper" program can never be instituted in modern society. Humans, as a whole, no matter their breeding or social background, all eventually obtain the idea that they are superior to other humans. A common concern, one that I share, is that people that are "bred" will get the idea that they are superior to "unrefined" individuals, instead of just being more specialized.

To coin a phrase: "Dogs make the worst dog breeders."

Thus, I concede the argument to you. Well done.

Edit: I'm not conceding that Eugenics is racist, but that it can "breed" racism.

Alright, I think I can accept that Eugenics does not begin because of racism, but can be a direct cause of it.

I disagree that it can't be implemented in society, though. I don't think it should(based on population growth and the size of the current population), but I think it could. Here's what I mean:

I see polygamy as a sort of "positive" Eugenics. It's not so much that you're discouraging the mating of "inferior" people, but encouraging the mating of "superior" people. I think that this is well within our basic mating instincts, in fact.

There is an article that I read some time ago entitled "Sexual Utopia in Power"(link to said article if you're so inclined http://theoccidentalquarterly.com/archives/vol6no2/DevlinTOQV6N2.pdf ) and it discusses the basic differences in "utopia" for the different sexes. Whereas men want multiple partners, women simply want the best mate. Men compete to be the best mate, women choose the best mate. In a system of polygamy, you could, theoretically, mate high status males with many females providing the world with more, hopefully, "superior" children. Unfortunately, you're depending a lot upon the women to accurately choose the correct high status male and there's no guarantee that you wont just end up breeding a "superior" with an "inferior."

Again, the biggest problem in this equation will be when the people realize what's going on. From this will spring classism and racism and all sorts of bad stuff, so I don't think this could be a realistic long term goal, but more of a short term idea to implement, hopefully for the betterment of future generations. The idea is to not inform the population about what's happening, relying upon their ignorance of what you want to achieve.

In fact, I believe that this very concept was used with Abraham from the Bible(I'm a Christian) in order to use Abraham as a, shall we say, stud. His superior faith in God and exceptional work ethic led him to be a fantastic beginning of eugenics.

Perhaps I'm just crazy, however.

 

[Zombie_Fish]

This is a mixed opinion for me. I'm for socialism, and believe an equal society as being the right thing to have, but I believe that we can't have one now. The reason for this is because the way our society and the people in our society work can't work in a socialist world. Humans compete with eachother, trying to be better than those around them. This in turn means that in a world where all that live in it is equal, people will want more than eachother, but they can't get more than eachother, as then they wouldn't be equal. And from there the whole system falls apart, as it did for communism, where politicians were given benefits above everyone else. This resulted in people revolting and being killed as a result, thus, we have a dictatorship that falls apart.

A socialist society is where I want humanity to end up, but due to humanity's selfishness we can't keep one stable yet.

 

[Seanchaidh]

Stalin actually claimed the comparative performance of the Soviet Union during the American Depression as a feather in the cap of socialism. Say what you want about compulsion, terror and purges, it worked for Stalin at the time. He was indeed able to rapidly industrialize a backward, feudal nation by scaring or charismatically inspiring people into working at the jobs handed down by central planning. I don't know what history you've been exposed to, but interwar Europe was already quite, quite economically... dire is probably the best way to describe it long before the crash of 1929. Germany was experiencing hyperinflation due to the war debt and printing money to pay it. Elsewhere there were other problems. No one was doing all that well, really.

So, what you're saying is that when you're inhumane you can really get stuff done. I happen to agree that's correct. After all, look what Egypt was able to do with slaves. If you see people as nothing more than cattle, that's cool with me. I happen to believe that there is a sort of divinity associated with the life of a human. I actually believe(crazy me, I know) that human life is sacred and that people should not be forced at gun point to work for their merciless masters.

Strange how it seems that conservatism is more compassionate toward humanity than the ever emotional liberalism.

You may certainly have wanted me to endorse brutality, but I did no such thing. Observing that something works is not the same as saying that it is right. Facts are facts. Ethics is entirely different. What we can learn from the Soviet Union is that the small success it enjoyed for a time was due to government intervention in the market and the substitution of the capitalist incentive to not starve to death if one was unable to obtain a wage with the incentive created by the threat of being placed in a gulag or worse if one didn't cooperate. The Soviet system started to have problems with laziness and inaccurate assessments of production when they relaxed the terror incentive and provided nothing new to replace it. That suggests that intervention through incentives can work and work well, and that the liberal theory of maximal efficiency through letting the market do what it will isn't, well, true. Brutality 'worked' because it had an effect on incentives. But there are other ways to influence incentives that aren't cruel or even punishing. The claim made by those such as Adam Smith is that greed provides the invisible hand that pushes society to produce what everyone needs... the incentives of a liberal (free market) society align with the desires and needs of that society so that production is efficiently handled by the rational reaction of individuals to price, supply, and demand. The system depends on there not being much theft. And it depends on there not being much violence. And it finally depends on there being sufficient, true information. The market alone cannot account for those; it would be foolish to leave military action to the whims of the market. We need a police force to account for theft and fraud, and we need some amount of transparency in business which is often best obtained by regulation.

You're right that the policies of the United States contributed to the Great Depression. However, it wasn't so much the market intervention and (inadequate though still helpful) Keynesian style spending as it was Hoover's 'fiscal discipline' (he raised taxes and cut spending in response to the Great Depression, the opposite of Keynesian policy) and overoptimistic government assessments of the health of the economy. In 1937, Roosevelt was convinced by the deficit hawks that the government had done enough to combat the depression and moved away from deficit spending. And at that point a chorus of angels descended from heaven, 'Hark!' to spread the good news of the government's finally coming to see the truth, that Keynes was wrong after all-- actually, what happened is that the abrupt downward shift in money supply from the newly changed fiscal policy plunged the economy into an even deeper recession. Unemployment jumped and production faltered. If there is a lesson to be learned from the Great Depression, it is that successfully stimulating the economy was even more expensive than Roosevelt or his contemporaries could have imagined. World War II and its aftereffect was the stimulus package that finally brought us out of it, and the spending there dwarfed BPA, Hoover Dam, Tennessee Valley, all of it. Luckily, there is good reason to believe that WW2's economic impact was somewhat watered down by the fact that it was military spending and (mostly) not infrastructure development, so it could still be that a Great Depression would not require spending on the scale of the Second World War to recover.

I'd like to disagree with you, but I have no real foundation of historical knowledge to really work with on this one. I'm still trying to get books on the subject to more fully understand the situation.

There are plenty of books with many different interpretations. Many of them disagree with my position. I suggest that you take a more careful look at the ones you wouldn't be inclined to agree with when you look for understanding. There is much truth to the laissez-faire ideology-- I certainly consider myself a capitalist and not a socialist-- but it is easy to take it too far, and very easy to interpret the failure of an inadequate stimulus to cause an economic recovery as the failure of stimulus altogether. It is always possible that, rather than stimulus "not working" that it simply wasn't large enough to account for the full measure of the recession it was meant to counteract. So unemployment is still better than it would have been, but not in a very good position anyway. 1937 is probably the best evidence of that.

As far as a company being too big to fail: financial companies were not too big to fail because they employed so many people. They don't really employ that many people. The problem is that financial companies and banks are the ones providing liquidity: businesses need loans to function. When the largest finance companies are in bankruptcy everything is screwed up. Businesses run out of money to pay their employees, to buy inputs, to replace machinery, etc. and can easily go under (or be forced to severely cut production) just because they don't have an immediately available loan for short-term expenses. Now you cannot possibly tell me that such a result is good for the economy, that the best course is to waste available resources hour by hour merely because of a temporary shortage of slips of paper... but I suspect you will just the same. Finance in particular has no "better widget"-- it only has better (or luckier) management. Enduring the costs of a financial services failure only to get another company with the same sorts of policies and employing the same sorts of people is needlessly and pointlessly masochistic on the grandest scale.

There wouldn't have been a liquidity problem if the companies had not been told to grant bad mortgages to people who couldn't have paid them back by the Community Reinvestment Act.

Facts are stubborn things: show where the CRA tells companies to grant mortgages to people who couldn't pay them back. I'm aware that a number of people say this, but it's also true that a number of very prominent experts disagree with them.

The largest problem with Schumpeterian creative destruction is entrance and exit costs and risks and the questionable availability of entrepreneurship. Economic recovery by replacement is very, very costly even aside from the fact that you're wasting millions of manhours of labor by letting unemployment reach its market equilibrium. New firms are not guaranteed to do any better, and a liquidity crisis is not exactly a good environment for any new firm. If you truly understand what a liquidity crisis entails, the reason why should be obvious.

There will always be entrepreneurs. Always. As long as there is a system in place for men to get rich based on their own clever ideas and hard work, it will be exploited. The only difference between capitalism and communism is which system they will work. Will they work the government or will they work the businesses? Man will become rich, there is no denying this will happen. The only question is, should we let them do so by gaming the financial and business markets or by gaming the government?

The experience of Jamaica's free zones is a stark contrast with your assessment of men "getting rich based on their own clever ideas and hard work."

Private welfare is still welfare. Your mother should be ashamed that she's getting treatment that her wallet indicates that she doesn't deserve. It is de facto theft from those who do pay (and because of those who cannot afford it tend to pay MORE) for such service. There's no such thing as a free lunch, and just providing a service for no fee merely because the person cannot afford it is the height of inefficiency and waste. Right?

Private welfare has a different name. It's called "charity." Accepting charity is, by most standards, not to be considered a "bad" thing. Accepting charity is a way of life for many people who simply cannot get by on their own merit. Life's hard, sometimes people need a little help.

It is not defacto theft any more than any other gift given is defacto theft. My mom was very open about her financial troubles two years ago when the disease started. The hospitals had every right to demand she pay back every dime that she owed to them. Unfortunately, they decided that they didn't have to milk a poor old woman for cash and could obtain the necessary money to pay for her treatment elsewhere. Perhaps even by donations from people in the community who believed they had enough money to share with those less fortunate, thus not throwing the burden onto other people needing medical care. Gee, that's almost exactly what seems to have happened.

People can't always be relied upon to do the right thing for others. That's true and unfortunate. But I would rather they have the chance to make that choice for themselves than snatch it away and force them to do what I believe is right all the time. Sounds a bit like tyranny, doesn't it?

Substituting arbitrary market pressures for arbitrary taxation and regulation doesn't sound like tyranny. Charity is irrational behavior in a capitalist system.

Take off the ideological blinders and realize for a moment that the problem is a whole ton more sophisticated than you make it out to be. For one thing, the crisis in housing was not even nearly the entire problem. Problems with private agencies utilizing bad assumptions to rate the risk of bundled subprime loans were a very, very big part of it. If deregulation were the answer, those private agencies would have realized that the CRA (if it was in fact a large enough factor to be the cause of the housing bubble) would have the effect that it did. But they didn't realize that so many of those loans would go unpaid because housing prices suddenly collapsed, suggesting that there was a problem with paid private financial information gathering. Know why they didn't get it right? Because there wasn't an incentive to get it right, just to provide the rating. They were paid by... the people selling the loans. Such is unregulated capitalism at its finest, and the real cause of the crisis. There was a structural problem with financial information... that regulation could fix. Sure, it could have been fixed privately too. But as you see... it wasn't. If you want to live in a world with financial mayhem of that sort merely because other people are failing to make sensible decisions, count me out.

The subprime loans were created by the CRA. The banks wouldn't have lent out the money if they didn't think the government had their back. Or, at least, they wouldn't have done it if they didn't think the government didn't have a gun at their back.

I did a little research since your "factual" conclusions seemed overbroad. And... No. Wrong. Subprime loans were mostly granted by people and institutions who thought they would make money with them. It makes very little sense to suggest otherwise.

From http://en.wikipedia.org/wiki/Community_Reinvestment_Act

Some legal and financial experts note that CRA regulated loans tend to be safe and profitable, and that subprime excesses came mainly from institutions not regulated by the CRA. In the February 2008 House hearing, law professor Michael S. Barr, a Treasury Department official under President Clinton,[64][108] stated that a Federal Reserve survey showed that affected institutions considered CRA loans profitable and not overly risky. He noted that approximately 50% of the subprime loans were made by independent mortgage companies that were not regulated by the CRA, and another 25% to 30% came from only partially CRA regulated bank subsidiaries and affiliates. Barr noted that institutions fully regulated by CRA made "perhaps one in four" sub-prime loans, and that "the worst and most widespread abuses occurred in the institutions with the least federal oversight".[109] According to Janet L. Yellen, President of the Federal Reserve Bank of San Francisco, independent mortgage companies made risky "high-priced loans" at more than twice the rate of the banks and thrifts; most CRA loans were responsibly made, and were not the higher-priced loans that have contributed to the current crisis.[110] A 2008 study by Traiger & Hinckley LLP, a law firm that counsels financial institutions on CRA compliance, found that CRA regulated institutions were less likely to make subprime loans, and when they did the interest rates were lower. CRA banks were also half as likely to resell the loans.[111] Emre Ergungor of the Federal Reserve Bank of Cleveland found that there was no statistical difference in foreclosure rates between regulated and less-regulated banks, although a local bank presence resulted in fewer foreclosures.

No correlation between foreclosure rates of regulated and less-regulated banks. Say it with me...

You seem to think people aren't capable of making decisions on their own. Not everyone is a sheep that must be lead forward by the nose. In fact, I do not believe that anyone should be led forward by the nose, even if they are a sheep. People should be left to their own devices so they can make the decisions they will make. If they are weak, they will be weak and that's fine. But it should be their choice to be weak.

You seem to think that "hard work" and "ingenuity" is the only resource needed to make money. It isn't. Realize this. Sure, people are generally the best at making decisions for themselves; in general, liberty is a very good thing for the economy because it usually provides the best outcome as people tend to know what's best for themselves in self-regarding matters. But not all economic matters are purely self-regarding, and regulation that prevents massive meltdowns and liquidity crises is quite certainly worth the tradeoffs with regard to personal liberty. No one is making you run a bank, no one is making you buy stock in a bank, it's fine. There is no gun.

 

[Shock and Awe]

Capitalism of course! In pure socialism there is no way to advance so there is no point in working, eventually everyone realizes this and says fuck it and slack off, and the whole country goes down the toilet.

 

[OneBig Man]

I say we go back to bartering. You have to have something worth giving if you want something.

 

[Lazier Than Thou]

First allow me to apologize. I did not clearly read what you said. You seem to have a much larger supply of sophistication than I am used to and am not used to actually trying to understand someone. Usually their position is immediately evident. It was my fault for judging quickly and harshly. I'm sorry.

You may certainly have wanted me to endorse brutality, but I did no such thing. Observing that something works is not the same as saying that it is right.

Allow me to interject that I agreed that slavery was profitable and that it works. That does not mean it is acceptable. We seem to agree on this point.

What we can learn from the Soviet Union is that the small success it enjoyed for a time was due to government intervention in the market and the substitution of the capitalist incentive to not starve to death if one was unable to obtain a wage with the incentive created by the threat of being placed in a gulag or worse if one didn't cooperate. The Soviet system started to have problems with laziness and inaccurate assessments of production when they relaxed the terror incentive and provided nothing new to replace it. That suggests that intervention through incentives can work and work well, and that the liberal theory of maximal efficiency through letting the market do what it will isn't, well, true. Brutality 'worked' because it had an effect on incentives. But there are other ways to influence incentives that aren't cruel or even punishing. The claim made by those such as Adam Smith is that greed provides the invisible hand that pushes society to produce what everyone needs... the incentives of a liberal (free market) society align with the desires and needs of that society so that production is efficiently handled by the rational reaction of individuals to price, supply, and demand. The system depends on there not being much theft. And it depends on there not being much violence. And it finally depends on there being sufficient, true information. The market alone cannot account for those; it would be foolish to leave military action to the whims of the market. We need a police force to account for theft and fraud, and we need some amount of transparency in business which is often best obtained by regulation.

So brutality can result in economic success. How is that helpful to a society that does not want to endorse barbarism? Aside from a stick, what greater incentive is there to produce than the ability to survive? Moreover, why would you want a system whereby the government punishes you when natural consequences can do the exact same thing? If I may be so bold, why stain your hand with the blood of a dying man? Moreover, why would the violence created by the government not force the people to distrust and fear the government?

Perhaps I am pointing out conclusions that you've already reached.

I agree there must be some regulation in the areas of fraud, theft, and violence. I would never suggest an anarchy as a model environment for economic success. I don't recall suggesting that a completely unregulated market is an ideal. I just want minimal intervention. Forcing companies that have publicly traded stock to give accurate and precise details on their company seems absolutely reasonable. Throwing thieves and murders in prison, also acceptable and desirable.

I just don't understand your point.

There are plenty of books with many different interpretations. Many of them disagree with my position. I suggest that you take a more careful look at the ones you wouldn't be inclined to agree with when you look for understanding. There is much truth to the laissez-faire ideology-- I certainly consider myself a capitalist and not a socialist-- but it is easy to take it too far, and very easy to interpret the failure of an inadequate stimulus to cause an economic recovery as the failure of stimulus altogether. It is always possible that, rather than stimulus "not working" that it simply wasn't large enough to account for the full measure of the recession it was meant to counteract. So unemployment is still better than it would have been, but not in a very good position anyway. 1937 is probably the best evidence of that.

I see the idea of a stimulus proposed by the government to be a horrible idea at face value. The only way government can obtain money is through taxation(or borrowing which leads to taxation), meaning that a stimulus would only work as "spreading the wealth" or "distribution of wealth." Not only that, but I have no faith in politicians to accurately predict or even decide the correct placement of the moneys of the people in order to effect an actual economic stimulus. One could argue that a stimulus would be terribly effective and the absolute right course of action, but you would have to, essentially, have a crystal ball which could tell you which sectors of the economy have growth potential enough to be worth investing into. I'd imagine that's why most projects of the Obama stimulus were for construction, clearly needed for the growth of the population. The problem with that is the possibility that supply has exceeded demand, which would mean that the government would be throwing money away(which basically seems to be their job to begin with).

While I think it has the potential to be a good idea, I don't think it could ever realistically live up to what it was intended to be.

Unless you think printing money is a good way to effect a stimulus[cough]Weimar Republic[/cough].

Facts are stubborn things: show where the CRA tells companies to grant mortgages to people who couldn't pay them back. I'm aware that a number of people say this, but it's also true that a number of very prominent experts disagree with them.

http://www.federalreserve.gov/dcca/cra/

Please note the section that says:

The CRA requires that each depository institution's record in helping meet the credit needs of its entire community be evaluated periodically. That record is taken into account in considering an institution's application for deposit facilities.

Perhaps I read this wrong, but it seems to me that it would be fairly easy to extort the various lending companies. Don't do what we say? We wont do what you want.

The Federal Reserve was helped by groups like ACORN which would, if I have been informed correctly, picket outside of lending institutions that didn't properly "invest in the community" which, as it later states was, essentially, arbitrary.

Neither the CRA nor its implementing regulation gives specific criteria for rating the performance of depository institutions. Rather, the law indicates that the evaluation process should accommodate an institution's individual circumstances.

Not exactly a smoking gun, I understand. Still, I have less faith in a group who have nothing personally invested to make the decision of who should and should not obtain a loan than the people whose life is literally on the line. An uninterested third party should not make those decisions.

The experience of Jamaica's free zones is a stark contrast with your assessment of men "getting rich based on their own clever ideas and hard work."

That's not really what I'm talking about, but that does point to some of what I meant. Yes, the exploitation of the Jamaican's is decidedly horrible, but does show that people will exploit whatever system they have available to them. You can't have two sets of rules and expect that people wont abuse them to their fullest.

If that's not what you mean, please explain further.

Substituting arbitrary market pressures for arbitrary taxation and regulation doesn't sound like tyranny. Charity is irrational behavior in a capitalist system.

Irrational though it may be, it seems to be a rather dependable behavior. Not only that, but it seems much more ethical as the people donating to charity do so for their own personal desires to whomever they want. Instead of forcing the people to pay for people they don't care about, it allows people to investigate the people they want to help and make sure the money is used as well as it can be.

Also, might I add: http://www.washingtonpost.com/wp-dyn/content/article/2009/06/09/AR2009060903233.html http://engram-backtalk.blogspot.com/2007/06/charitable-giving-by-americans.html

It seems rather reliable to believe that the people who have wish to give to the people who have not or the people in need. At the very least, it seems when people have the most ability to give to others(as in, not being taxed in order to pay for socialized programs) they will do so. This is shown by the graph of "National Giving Levels Shown as a Percentage of GDP" in the second article.

As an after thought, please do not suggest that my mother does not feel ashamed for needing help. My mother is very proud, having raised 6 children on her own after my father died 19 years ago. It's an unfortunate truth that sometimes you don't get what you need, but sometimes good people will step forward to give to those that need. I would ask that you do not disparage her name or the names of the good people that have helped us.

I did a little research since your "factual" conclusions seemed overbroad. And... No. Wrong. Subprime loans were mostly granted by people and institutions who thought they would make money with them. It makes very little sense to suggest otherwise.

From http://en.wikipedia.org/wiki/Community_Reinvestment_Act

Some legal and financial experts note that CRA regulated loans tend to be safe and profitable, and that subprime excesses came mainly from institutions not regulated by the CRA. In the February 2008 House hearing, law professor Michael S. Barr, a Treasury Department official under President Clinton,[64][108] stated that a Federal Reserve survey showed that affected institutions considered CRA loans profitable and not overly risky. He noted that approximately 50% of the subprime loans were made by independent mortgage companies that were not regulated by the CRA, and another 25% to 30% came from only partially CRA regulated bank subsidiaries and affiliates. Barr noted that institutions fully regulated by CRA made "perhaps one in four" sub-prime loans, and that "the worst and most widespread abuses occurred in the institutions with the least federal oversight".[109] According to Janet L. Yellen, President of the Federal Reserve Bank of San Francisco, independent mortgage companies made risky "high-priced loans" at more than twice the rate of the banks and thrifts; most CRA loans were responsibly made, and were not the higher-priced loans that have contributed to the current crisis.[110] A 2008 study by Traiger & Hinckley LLP, a law firm that counsels financial institutions on CRA compliance, found that CRA regulated institutions were less likely to make subprime loans, and when they did the interest rates were lower. CRA banks were also half as likely to resell the loans.[111] Emre Ergungor of the Federal Reserve Bank of Cleveland found that there was no statistical difference in foreclosure rates between regulated and less-regulated banks, although a local bank presence resulted in fewer foreclosures.

No correlation between foreclosure rates of regulated and less-regulated banks. Say it with me...

http://www.lewrockwell.com/dilorenzo/dilorenzo125.html

Now, I don't know everything that is said in that article and cannot vouch for it or how well read the author is. However the man seems to understand the situation better than I do. Still, if this is going to become a battle of the experts, we're going to have to just agree to disagree.

You seem to think that "hard work" and "ingenuity" is the only resource needed to make money. It isn't. Realize this. Sure, people are generally the best at making decisions for themselves; in general, liberty is a very good thing for the economy because it usually provides the best outcome as people tend to know what's best for themselves in self-regarding matters.

So...what other resources are necessary? I mean, you can deny all you want, but you didn't really provide me with anything else that's needed.

But not all economic matters are purely self-regarding, and regulation that prevents massive meltdowns and liquidity crises is quite certainly worth the tradeoffs with regard to personal liberty. No one is making you run a bank, no one is making you buy stock in a bank, it's fine. There is no gun.

If the government nationalizes the banks, then the government is forcing me to buy stock in a bank at gun point. In fact, the government has already forced the citizens of the United States of America to buy stock in GM as well as bailing out banking institutions. The government does everything at the point of a gun, they don't make suggestions.

 

[Seanchaidh]

First allow me to apologize. I did not clearly read what you said. You seem to have a much larger supply of sophistication than I am used to and am not used to actually trying to understand someone. Usually their position is immediately evident. It was my fault for judging quickly and harshly. I'm sorry.

You may certainly have wanted me to endorse brutality, but I did no such thing. Observing that something works is not the same as saying that it is right.

Allow me to interject that I agreed that slavery was profitable and that it works. That does not mean it is acceptable. We seem to agree on this point.

Well and good then.

What we can learn from the Soviet Union is that the small success it enjoyed for a time was due to government intervention in the market and the substitution of the capitalist incentive to not starve to death if one was unable to obtain a wage with the incentive created by the threat of being placed in a gulag or worse if one didn't cooperate. The Soviet system started to have problems with laziness and inaccurate assessments of production when they relaxed the terror incentive and provided nothing new to replace it. That suggests that intervention through incentives can work and work well, and that the liberal theory of maximal efficiency through letting the market do what it will isn't, well, true. Brutality 'worked' because it had an effect on incentives. But there are other ways to influence incentives that aren't cruel or even punishing. The claim made by those such as Adam Smith is that greed provides the invisible hand that pushes society to produce what everyone needs... the incentives of a liberal (free market) society align with the desires and needs of that society so that production is efficiently handled by the rational reaction of individuals to price, supply, and demand. The system depends on there not being much theft. And it depends on there not being much violence. And it finally depends on there being sufficient, true information. The market alone cannot account for those; it would be foolish to leave military action to the whims of the market. We need a police force to account for theft and fraud, and we need some amount of transparency in business which is often best obtained by regulation.

So brutality can result in economic success. How is that helpful to a society that does not want to endorse barbarism? Aside from a stick, what greater incentive is there to produce than the ability to survive? Moreover, why would you want a system whereby the government punishes you when natural consequences can do the exact same thing? If I may be so bold, why stain your hand with the blood of a dying man? Moreover, why would the violence created by the government not force the people to distrust and fear the government?

Regulation can create incentives or change them somewhat in order to get better outcomes: for instance, in Sweden there used to be very long waits for surgery because hospital administrators tended to think they would get more funding when they had longer lines because those lines showed that the hospital "needed" more money. A fund was created to pay hospitals money if they reduced those waits below a certain amount, and within months the queues had reached the target in almost all cases. Squaring incentives with the outcomes we want works. And you don't always have to cut off someone's head to do it.

I agree there must be some regulation in the areas of fraud, theft, and violence. I would never suggest an anarchy as a model environment for economic success. I don't recall suggesting that a completely unregulated market is an ideal. I just want minimal intervention. Forcing companies that have publicly traded stock to give accurate and precise details on their company seems absolutely reasonable. Throwing thieves and murders in prison, also acceptable and desirable.

I just don't understand your point.

I appear to have neglected to actually make my point; I should have mentioned that market stability is important for the reliability of business and economic information. In order for businesses to be able to predict whether they can make a profit by producing something or providing a service, there needs to be at least a reasonable expectation that the market won't vastly shift every so often. Market instability can be just as bad as political instability for souring investment. And when business risk is high, you tend to have waste simply because of the underutilization of resources. Some resources don't perish, but others do: manhours of labor are lost with each passing hour.

There are plenty of books with many different interpretations. Many of them disagree with my position. I suggest that you take a more careful look at the ones you wouldn't be inclined to agree with when you look for understanding. There is much truth to the laissez-faire ideology-- I certainly consider myself a capitalist and not a socialist-- but it is easy to take it too far, and very easy to interpret the failure of an inadequate stimulus to cause an economic recovery as the failure of stimulus altogether. It is always possible that, rather than stimulus "not working" that it simply wasn't large enough to account for the full measure of the recession it was meant to counteract. So unemployment is still better than it would have been, but not in a very good position anyway. 1937 is probably the best evidence of that.

I see the idea of a stimulus proposed by the government to be a horrible idea at face value. The only way government can obtain money is through taxation(or borrowing which leads to taxation), meaning that a stimulus would only work as "spreading the wealth" or "distribution of wealth." Not only that, but I have no faith in politicians to accurately predict or even decide the correct placement of the moneys of the people in order to effect an actual economic stimulus. One could argue that a stimulus would be terribly effective and the absolute right course of action, but you would have to, essentially, have a crystal ball which could tell you which sectors of the economy have growth potential enough to be worth investing into. I'd imagine that's why most projects of the Obama stimulus were for construction, clearly needed for the growth of the population. The problem with that is the possibility that supply has exceeded demand, which would mean that the government would be throwing money away(which basically seems to be their job to begin with).

While I think it has the potential to be a good idea, I don't think it could ever realistically live up to what it was intended to be.

Unless you think printing money is a good way to effect a stimulus[cough]Weimar Republic[/cough].

I agree that government is often very bad at countercyclical policy. The biggest thing they do is fail to counter the upward swings with spending cuts and tax increases. They pass surpluses back to taxpayers or increase spending and then go Keynesian again when a stimulus package is needed... curbing enthusiasm isn't politically savvy, but saving the economy is popular. The government should exploit the taxes generated by good economies to drastically pay down our debt, but they never seem to do so. Instead they employ tax cuts or spending increases to basically squander the windfall AND on top of that cause inflation by doing so when the market is at near full employment.

But that can change if enough people are convinced that it should happen and elect leaders who will do it. And even though we tend to slack on the upturns, it is still a good idea to stimulate during the downturns. For his part, Obama has pledged to reduce the deficit once the economy is out of recession. Hopefully we can reduce it so much that we manage to reduce our debt as well, but I'm not holding my breath. And you really don't need a crystal ball to figure it out in the extreme cases; if unemployment is high, stimulate. If it isn't, don't.

Facts are stubborn things: show where the CRA tells companies to grant mortgages to people who couldn't pay them back. I'm aware that a number of people say this, but it's also true that a number of very prominent experts disagree with them.

http://www.federalreserve.gov/dcca/cra/

Please note the section that says:

The CRA requires that each depository institution's record in helping meet the credit needs of its entire community be evaluated periodically. That record is taken into account in considering an institution's application for deposit facilities.

Perhaps I read this wrong, but it seems to me that it would be fairly easy to extort the various lending companies. Don't do what we say? We wont do what you want.

The Federal Reserve was helped by groups like ACORN which would, if I have been informed correctly, picket outside of lending institutions that didn't properly "invest in the community" which, as it later states was, essentially, arbitrary.

Neither the CRA nor its implementing regulation gives specific criteria for rating the performance of depository institutions. Rather, the law indicates that the evaluation process should accommodate an institution's individual circumstances.

Not exactly a smoking gun, I understand. Still, I have less faith in a group who have nothing personally invested to make the decision of who should and should not obtain a loan than the people whose life is literally on the line. An uninterested third party should not make those decisions.

The Fed isn't making individual decisions of who should receive loans but at most offering general guidelines and target numbers. Also, 'protest' isn't referring to picketing but to lodging formal complaints based on CRA to the Fed or elsewhere. The Fed is free not to take ACORN or whoever else seriously if they find that their demands are more than reasonable.

The experience of Jamaica's free zones is a stark contrast with your assessment of men "getting rich based on their own clever ideas and hard work."

That's not really what I'm talking about, but that does point to some of what I meant. Yes, the exploitation of the Jamaican's is decidedly horrible, but does show that people will exploit whatever system they have available to them. You can't have two sets of rules and expect that people wont abuse them to their fullest.

If that's not what you mean, please explain further.

Regulation can create opportunities to abuse the system or it can close them. Jamaica's free zones were basically unregulated, unfettered capitalism. Exploiting cheap labor and an overly permissive business climate doesn't really have much to do with ingenuity or hard work.

Substituting arbitrary market pressures for arbitrary taxation and regulation doesn't sound like tyranny. Charity is irrational behavior in a capitalist system.

Irrational though it may be, it seems to be a rather dependable behavior. Not only that, but it seems much more ethical as the people donating to charity do so for their own personal desires to whomever they want. Instead of forcing the people to pay for people they don't care about, it allows people to investigate the people they want to help and make sure the money is used as well as it can be.

Also, might I add: http://www.washingtonpost.com/wp-dyn/content/article/2009/06/09/AR2009060903233.html http://engram-backtalk.blogspot.com/2007/06/charitable-giving-by-americans.html

It seems rather reliable to believe that the people who have wish to give to the people who have not or the people in need. At the very least, it seems when people have the most ability to give to others(as in, not being taxed in order to pay for socialized programs) they will do so. This is shown by the graph of "National Giving Levels Shown as a Percentage of GDP" in the second article.

So essentially capitalism needs people to privately decide to act against their own economic interests? Like people who aren't very... capitalist? Seems a shaky foundation.

I did a little research since your "factual" conclusions seemed overbroad. And... No. Wrong. Subprime loans were mostly granted by people and institutions who thought they would make money with them. It makes very little sense to suggest otherwise.

From http://en.wikipedia.org/wiki/Community_Reinvestment_Act

Some legal and financial experts note that CRA regulated loans tend to be safe and profitable, and that subprime excesses came mainly from institutions not regulated by the CRA. In the February 2008 House hearing, law professor Michael S. Barr, a Treasury Department official under President Clinton,[64][108] stated that a Federal Reserve survey showed that affected institutions considered CRA loans profitable and not overly risky. He noted that approximately 50% of the subprime loans were made by independent mortgage companies that were not regulated by the CRA, and another 25% to 30% came from only partially CRA regulated bank subsidiaries and affiliates. Barr noted that institutions fully regulated by CRA made "perhaps one in four" sub-prime loans, and that "the worst and most widespread abuses occurred in the institutions with the least federal oversight".[109] According to Janet L. Yellen, President of the Federal Reserve Bank of San Francisco, independent mortgage companies made risky "high-priced loans" at more than twice the rate of the banks and thrifts; most CRA loans were responsibly made, and were not the higher-priced loans that have contributed to the current crisis.[110] A 2008 study by Traiger & Hinckley LLP, a law firm that counsels financial institutions on CRA compliance, found that CRA regulated institutions were less likely to make subprime loans, and when they did the interest rates were lower. CRA banks were also half as likely to resell the loans.[111] Emre Ergungor of the Federal Reserve Bank of Cleveland found that there was no statistical difference in foreclosure rates between regulated and less-regulated banks, although a local bank presence resulted in fewer foreclosures.

No correlation between foreclosure rates of regulated and less-regulated banks. Say it with me...

http://www.lewrockwell.com/dilorenzo/dilorenzo125.html

Now, I don't know everything that is said in that article and cannot vouch for it or how well read the author is. However the man seems to understand the situation better than I do. Still, if this is going to become a battle of the experts, we're going to have to just agree to disagree.

I read that over, and I must point out that he's very slanted in his phrasing about community organizations "bragging about getting loan commitments" (as if banks can only be bullied into supporting community organizations) and doesn't really give much factual support to his idea that the Fed is forcing banks to make bad loans. That could happen if you read the act in a certain way, but it could also simply not happen. The Fed is an independent body that generally is pretty market-loving. When it is true that people were making the same sorts of loans even without regulatory encouragement, it seems strange to say that the loans were caused by regulation and not by profit motive.

Sometimes there is a good reason you don't see some opinions all that widely represented in the mainstream media-- because some of them are bad. And I'll note that the interpretation he was talking about is on Fox News quite a lot.

You seem to think that "hard work" and "ingenuity" is the only resource needed to make money. It isn't. Realize this. Sure, people are generally the best at making decisions for themselves; in general, liberty is a very good thing for the economy because it usually provides the best outcome as people tend to know what's best for themselves in self-regarding matters.

So...what other resources are necessary? I mean, you can deny all you want, but you didn't really provide me with anything else that's needed.

It depends on the industry, though a very general requirement is the society around you wanting what you can provide. Robinson Crusoe could not become rich unless he escaped his island. Many industries require a great deal of capital investment just to get started; that requires investors who are willing to loan money or enter a partnership on the promise of business success. These do not necessarily come with ingenuity or hard work. Location is often crucial to a business: someone else can occupy it and be unwilling to sell the land. Most of all, though, businesses tend to need employees who are up to doing what needs doing. Sometimes that human capital is not there. Hard work and ingenuity from entry into school can usually get you a middle class job if the schools are up to par, though it doesn't really guarantee anything.

But not all economic matters are purely self-regarding, and regulation that prevents massive meltdowns and liquidity crises is quite certainly worth the tradeoffs with regard to personal liberty. No one is making you run a bank, no one is making you buy stock in a bank, it's fine. There is no gun.

If the government nationalizes the banks, then the government is forcing me to buy stock in a bank at gun point. In fact, the government has already forced the citizens of the United States of America to buy stock in GM as well as bailing out banking institutions. The government does everything at the point of a gun, they don't make suggestions.

The government is forcing you to buy stock in a bank as much as it is forcing greenpeace activists to buy nuclear weapons or subsidize oil companies... it isn't really, but if you want to interpret it that way, then it's just tough shit: the democratic principle is at work and you've been overruled by our elected officials in their capacity as representatives of the polity. The fact remains that you are free not to work in the banking industry or run a bank if you don't want to submit yourself to banking regulations. Economic stability is worth the drawbacks of regulation.

 

[veloper]

Anarchy's not chaos you know but rather a system where everyone would have complete and utter individual freedom, and all live happily side by side, being peaceful and free, urgh horrible.

No, that's Anarchy in a perfect world.
Anarchy is an inherently flawed system because people are inherently malicious and self-serving.

Which is exactly why none of the stated systems work. The systems aren't flawed, it's the people who are.

People were here FIRST, so it's the systems that are flawed.

Erm, but wouldn't that in and of itself prove that people are flawed because people created the systems? If people were not flawed then they would have created a perfect system or systems, no?

You've got him there, I doubt there'll be a response.

Well you two can share all the credit for socialism, fascism and the wrongs on the world for all I care, but leave the rest of us out of it.

Some people isn't the same as all people.

My good sir you have missed the point. Fascism has nothing to do with Socialism. Socialism is about provailing over humanity for its best (ethical) interests, with a government that is able to administer the trade. Fascism can be achieved in capitalist, communist, socialist, totaletarian(sp?) or tyranical governments. Get your facts straight, and I'd gladly take all the credit for the ills of a true Socialist country because they'd be few and far between.

There are no facts presented in this cascade, just the opinions of you and your friend.

This wasn't about just socialism, it was about ideological systems in general. Your friend was blaming people for the failure of those systems. People aren't to blame.

People are what they always have been. A system that doesn't work with conditions that have always been there can only be considered a flawed system.

Blame yourself for everything you feel like it, not the rest of us.

 

[Worsle]

[While I don't disagree with a single thing you've stated as a matter of fact, I could never vote for a Eugenics system of any kind. I don't support socialized health care for some of the very reasons you talk about and could never support a government that controls the reproductive abilities of the populace.

I understand and respect your opinion, and admit that a proper, unbiased, humane, and unexploited Eugenics program (if any at all) would be virtually impossible in most, if not all industrialized nations. Both because of logistal concerns, and moral ones. Unfortunately, Eugenics has a bad reputation due to many racist and classist regimes (from the Nazis to several states within the U.S. from 1896-1983 [mostly in the deep south]) calling their racial/classial purging programs "Eugentics Programs". Sterilyzation, Execution, and Racism are not proper eugenics. Proper eugenics is unbiased on race, religion, or social class, and breeds humans solely based on their "genetic longevity" (their gene's ability to benefit, rather than hinder, the developement and natural survivability of future generations). I myself would be disallowed from breeding do to weak ligaments in my legs and arms, and allergy-induced astma, both of which run in the family.

Only you know that is a hideously flawed argument? No one can predict what genes will be beneficial and witch will be harmful, the only real way round this is to keep as much genetic diversity as possible not as little. What if the genes related to asthma turn out to give people a massive advantage against some global pandemic? If we cut them out then we will never know and are cutting out the chance of our species to survive. People can not predict the future and that makes eugenics a stupid and quite probably harmful endeavour.

Also using it as an argument against a national health service is also pretty off. As as it stands all that sorting people out is money and that is surely a much worse situation for the future of the species than any thing else.

Now to the topic at hand do we properly consider what a purely capitalist country is like? The only real example of it I can think of it is Britian during the industrial revolution and I don't think any one wants to live in that. Pure capitalism encourages money and money in a few hands when it comes down to it, they have no real intensive to let other people to come up the ladder and every incentive to get rid of any completion. In the end the average British worker was in such a poor state the government had to step in (partly so it could still field an army but anyway) and I can't think of a modern country that really comes close to that. I can't help but think anyone pumping for pure capitalism is ultimatum making a foolish decision and one that would most likely hurt them as well.

 

[Theissen]

Basically, one of the most frequent arguments against socialism here is corruption. Of course, they're referring to Russia and East European countries where socialism is thrived and corruption is widespread.

If you people had done your research a little better, you would have noticed the Scandinavian countries. The taxes in Scandinavia are among, of not the, highest in the world. Health care is also free and government spending is quite big.

Corruption? The few cases that exist are small and insignificant.

I'm sure outsiders will call Denmark, Sweden, or Norway for socialist, which is totally fine. It just proves that socialism can work fine.

But before converting to socialism, it's important to notice that we're talking about relatively small countries. Denmark has 5,5 millions inhabitants, Sweden has 9 millions, and Norway has 5 millions. I'm fairly convinced that the small size is why it's working as well as it does. For big countries such as USA, it's fair to assume it wouldn't work as well.

Which is why decentralization is a key word. Pooling all the power for few people in a big country is a horrible idea. Just ask history.

 

[veloper]

Anarchy's not chaos you know but rather a system where everyone would have complete and utter individual freedom, and all live happily side by side, being peaceful and free, urgh horrible.

No, that's Anarchy in a perfect world.
Anarchy is an inherently flawed system because people are inherently malicious and self-serving.

Which is exactly why none of the stated systems work. The systems aren't flawed, it's the people who are.

People were here FIRST, so it's the systems that are flawed.

Erm, but wouldn't that in and of itself prove that people are flawed because people created the systems? If people were not flawed then they would have created a perfect system or systems, no?

You've got him there, I doubt there'll be a response.

Well you two can share all the credit for socialism, fascism and the wrongs on the world for all I care, but leave the rest of us out of it.

Some people isn't the same as all people.

My good sir you have missed the point. Fascism has nothing to do with Socialism. Socialism is about provailing over humanity for its best (ethical) interests, with a government that is able to administer the trade. Fascism can be achieved in capitalist, communist, socialist, totaletarian(sp?) or tyranical governments. Get your facts straight, and I'd gladly take all the credit for the ills of a true Socialist country because they'd be few and far between.

There are no facts presented in this cascade, just the opinions of you and your friend.

This wasn't about just socialism, it was about ideological systems in general. Your friend was blaming people for the failure of those systems. People aren't to blame.

People are what they always have been. A system that doesn't work with conditions that have always been there can only be considered a flawed system.

Blame yourself for everything you feel like it, not the rest of us.

Yet again I must disagree, and I do so with good humour.
Socialism is a definite system with a definite definition (hence the similarities between those two words), therefore what the word Socialism means and what the System is about is a fact. I'm not saying your opinions are wrong, it is the mis-information that has spawned your beliefs which is wrong.

The system (IMO) is better, the fact it doesent work is irrelevant. The OP did not say which is better in the world we live in, that is obviously Capitalism. He asked for which system is better and anyone who doesent support the ideas behind socialism (if they understand it) has little humanity left in them. Quite a juxtaposition considering it is humanity that prevents the system from working.

That is doesn't work is the most relevant part. There's no need for things that don't work.

 

[Warwolt]

Capitalism. You get what you pay for--or in this case, what you work for. It's only fair.

Socialism breeds laziness.

Aah, yes. Because lending he who've fallen down a hand, to help him get back on his feet to work again breeds laziness.

 

[Booze Zombie]

Socialism.

The idea that everyone should have a chance irks me less than The American Way does, to be quite fucking frank.

 

[TankCopter]

I'm going to be a fence-sitter and say a socialist/capitalist hybrid, somewhat like Australia. We have Medicare so we can go to doctors even if we are poor, but we also have rich bastards who probably run the joint.

 

[Frankydee]

I'd have to choose socialism if only to brutalize people who disagree with government decisions. Seriously it's like bring up a bill here in the states and it's all "whiney whiney whineeeeey."

Capitalism. You get what you pay for--or in this case, what you work for. It's only fair.

Socialism breeds laziness.

Aah, yes. Because lending he who've fallen down a hand, to help him get back on his feet to work again breeds laziness.

I actually have to agree with Vuljatar on this one because although the intentions of welfare are good it's getting increasingly more and more difficult for those on welfare to have any sort of incentive to get a job. This pretty much goes for socialism as well.