Would the nationalization of the 500 corporations lead to lower prices of goods?

[Trotskist]

Hello all: i have a simple question about the prices of goods and services in the dictatorship of the proletariat (Socialist Workers state). My question is if nationalizing the 500 or more largest corporations of the United States of America would lead to cheaper, lower-priced goods and services. For example, right now a Honda Accord costs like 24,000 dollars. Do you think that in a nationalized Honda Corporation that same car would be a lot cheaper?

Thanx


Trotskist


.

[Adil3tr]

Well, umm, What?

This is for radical Marxists, that's kind of out of place/off topic.
But a nationalized company in a capitalist economy would probably pay its workers better and they would be more likely to be unionized so I don't think it would. In a socialist economy, the factories would be multiplied and expanded to make cars easily so that everyone who need or wants one could have one, but making them electric who be a setback.

[Trotskist]

Well, remember that in a capitalist (for profit system) the price of a good and service is over-valued. For example if a Honda Accord 2010 costs 25,000 dollars in the market, its real cost price is a lot less than that. Maybe 15,000 dollars, but the 10,000 dollars extras goes to a few capitalists, like the Honda Corporation capitalist owners, local car-dealer owners, etc.

However i think that even though workers would be payed more because they would be co-owners with the ownership system of "Workers control" i think that in a socialist workers state there wouldn'tbe so many middle-men.

Remember that in a capitalist free market system, a product is not directly sold by its makers but by local suppliers, i think thats another real cause of driving the prices up in a capitalist neoliberal system

.


This is for radical Marxists, that's kind of out of place/off topic.
But a nationalized company in a capitalist economy would probably pay its workers better and they would be more likely to be unionized so I don't think it would. In a socialist economy, the factories would be multiplied and expanded to make cars easily so that everyone who need or wants one could have one, but making them electric who be a setback.

[automattick]

The whole idea is to abolish corporate hierarchy and plunder, not think of ways which they would better serve the consumer and therefore facilitate capital, albeit in a different guise. If the new state-installed CEO's of the Fortune 500 were to lower their prices, they would also have to cut the salaries of the workers there as well. After all, one does not generate money as an employee, but rather gets whatever crumbs are left over from your boss's pockets.

Many of these companies offer financial services, which would mean that under a nationalization scheme they would be competing with previously-established government programs, thus bloating the system. Nationalization really isn't a radical idea and given that nationalization is more in reaction to the predatory, expansionary nature of finance capital, I wouldn't see it as working. The reason being that this is more characteristic of developing nations whose own bourgeoisie needs room to carve out their own wealth--either situation would harm the working class.

[this is an invasion]

I'm not down with state capitalism.

[Trotskist]

I think that you are generalizing too much. Remember that there is a big difference between *nationalization under state-control* compared with *nationalization under workers-control*.

I mean wouldn't nationalization under workers-control of the 500 biggest corporations of USA be a socialist policy?

And remember that nationalization under workers-control means expropiating the businesses of the bourgeoise-class to be transfered to the control and ownership of the working class

.



The whole idea is to abolish corporate hierarchy and plunder, not think of ways which they would better serve the consumer and therefore facilitate capital, albeit in a different guise. If the new state-installed CEO's of the Fortune 500 were to lower their prices, they would also have to cut the salaries of the workers there as well. After all, one does not generate money as an employee, but rather gets whatever crumbs are left over from your boss's pockets.

Many of these companies offer financial services, which would mean that under a nationalization scheme they would be competing with previously-established government programs, thus bloating the system. Nationalization really isn't a radical idea and given that nationalization is more in reaction to the predatory, expansionary nature of finance capital, I wouldn't see it as working. The reason being that this is more characteristic of developing nations whose own bourgeoisie needs room to carve out their own wealth--either situation would harm the working class.

[Animal Farm Pig]

I think nationalization of the top 500 companies would lead to "lower prices", or at least better availability of goods and services to the average person. Remove the extraction of excess value by the capitalist class, and people will benefit.

For some reason, when I clicked this, I thought it was only about auto sector. I think it's an interesting question to imagine how things would be in a piece-by-piece nationalization. Things tend to be imperfect and incomplete more than the opposite, and I think the "revolution" will is more likely to be imperfect and piecemeal than total.

So, by way of example, let's look only at auto sector and costs.

Who says that we should treat automobiles as consumer goods? I think that the ability to move from place to place is an important right. Maybe provision of cars to people should be considered on a need basis-- if you already have a car that works, you don't need another. If you need a car, well, you need a car. Maybe people could put in an application for a car and the costs could be borne by progressive taxes, or payment could be determined on a sliding scaled based on income.

That would be a radically different way to look at cost. Let's say that the government decides cars are to be rationed to the people based on ability to pay (set a market price). Let's also pretend that there are no subsidies or taxes on it. It seems to me that the rational way to price the vehicle will be to add up the price of the inputs, and charge for them. The input costs would include raw material and energy costs, labor costs in manufacturing, R&D, administration, etc. So, let's look at input costs--

Raw material & energy--

Presumably, raw materials (steel, plastics, textiles, etc.) will be need to be purchased on world market prices. Pretending that no revolution has occurred in other places, these are prices set under capitalist conditions. The advantage a nationalized auto sector can have is cooperation in purchasing. By working together to get the lowest price (in contrast to being played off against each other by capitalist material suppliers) a new national auto company could exert a downward pressure on the material prices. There is a problem with this-- the workers who are extracting and producing the material inputs will suffer. An alternative course of action, would be for the new national auto company to dictate salary and working conditions for material supplies. The impact of the national auto company on working conditions for workers producing materials will vary based on how much of the market for the material the national auto company controls. In areas where the national auto company controls the majority of the market for the material, the company could essentially dictate terms to the producers. In areas where the auto company only consumes a small portion of the material produced, their impact will be lower.

Energy is somewhat different. Outside of some global capitalist energy trading casino system, it's tricky to import energy from China to the USA. Energy prices will be national prices (as opposed to international market prices for material). So, those costs are up to the national market. If the power companies are still capitalist, the auto company could have a big say in setting prices. They could also demand that the prices reflect true cost of energy production including externalized costs (pollution, global warming, etc.).


Labor costs in manufacturing--

The workers should have living wages. I think the US military actually does a pretty good job at this. There is a base pay, plus bonuses for seniority and experience. There is also a basic allowance for housing (or housing provided) based on number of dependents and living costs based on location, a basic subsistence allowance (for food costs), various other allowances (uniform costs, various other shit), and pay incentives for special skills, hazardous duty, family separation, jobs that suck, etc. When I was a married PFC in the Army with a stay-at-home wife, we lived pretty comfortably (aside from me having to put up with a bunch of Army bullshit). Alternatively, the workers could be paid on the standard government pay scale. Personally, I think a pay scale based on how shitty the work is (more shitty = higher pay), and how much money the person needs (number of dependents, other family income, special needs, etc.) is probably the best system.

Of course, salary alone is not enough. The workers must also have proper health care-- assuming that there is still the private system and no NHS in the USA. A large national auto company could create a large pool for private health insurance. In that way, they could decrease cost. Alternately, it could make more sense to create company hospitals and hire company doctors. In that way, the national auto company could avoid putting money into the hands of capitalist insurance companies and hospitals. Introduce reciprocity agreements with other hospitals so that workers could could health care while traveling, people could be treated at national hospitals when the national hospital is closest, etc. Something like this could be the seed of a true national health service.

There is of course a question of the number of workers. I may look a bit reactionary here, but I think it's better if there are as few workers as possible. I know, nobody likes redundancies. Nobody likes their jobs taken over by machines. It sucks to be unemployed. That being said, we have to look at things on a higher level. Every worker who is doing something that could be done by a machine is a wasted worker. Often, the jobs being done by machines are jobs that suck. By mechanizing more, we eliminate a lot of jobs that suck, and allow workers to do something else that is more productive.

Little story: One of my friends worked at a poultry plant. Her job was to pull the chickens off a conveyor belt and put them into a bucket. One day, she was replaced by a machine-- it was a pole. The pole knocked the chickens off the belt and into the bucket. Her job sucked, and putting that pole in place eliminated that job and allowed her to do other productive work. She's now the president of a fairly large non-profit organization.

R&D, administration, etc.--

I think R&D costs could be decreased a lot. Right now, there are a crazy number of different models of cars. Each has a research and development cost. The reason for the crazy number of different models is all about capitalist competition, market differentiation, and market segmentation. A merged national auto company shouldn't have this problem. I think that they could produce maybe three different vehicles-- a small car, a large wagon/saloon, and a pick-up truck. We can quibble about the number of vehicles and types. Maybe a sports car and a mid-sized car could be included. Maybe the small car could be modified or optioned with sports parts, etc. Nonetheless, by decreasing from 100 different models to ~3, R&D costs will go down significantly. This will also introduce economies of scale in manufacturing and servicing. Moving from a perspective of planned obsolescence to a perspective or producing a quality product for workers will diminish long term services costs and allow R&D to operate on longer product cycles. A quality standardized product is far better than companies producing 100 different models with yearly change cycles and a 3 -5 year "upgrade" cycle.

Of course, that is only looking at "consumer" vehicles. We should also look at "business vehicles"-- delivery vehicles, mass transit, lorries, etc. Even in this (somewhat smaller) sector, I think the same economies can be delivered, albeit at a smaller scale.

Administration costs could likely be decreased. Merging the various capitalistic auto companies into a single entity could likely decrease the number of various managers, accountants, and layers of bureaucracy. I couldn't provide any figure on this, but it seems intuitively true.


So, we've looked at one single sector-- the auto sector. This my analysis of things. I know-- it's woefully incomplete. Also, someone else may come to different conclusions. I'd be eager to see them. I think my analysis of this sector is pretty good, and the conclusions I draw from this sector could be applied to many different ways to provision goods and services to the people. So, I think nationalization is a good way to improve the quality of life for workers. I'd be very interested to here comments or critiques.

[Sir Comradical]

To answer your question, yes.

Profit driven corporations operate under conditions of oligopolistic/monopolistic competition which means they will NOT pursue allocative efficiency - where price is equal to marginal cost. Instead they'll produce only at the point where marginal revenue equals marginal cost while setting prices above marginal cost.

[LC89]

I remember I read somewhere USSR mange to make AK-47 nearly free to supply to its allies.

[Rousedruminations]

lol what ? and where did u hear this from ?