Socialism and World GDP per capita

[heiss93]

How does socialism deal with the world average or median gdp per capita? The world GDP capita is calculated by a rather simple formula of national gdp divided by total population. It isn't perfect in factoring in international trade, but is relatively accurate. So the world GDP per capita is currently $10,500. Which means that if a world socialist state were to redistribute wealth entirely equally, each citizen would have $10,500.

To apply it more specifically to a national context. The GDP per capita of the USA is $47,123. While the median household income, which better factors in inequality is $49,777. Now granted much of the true wealth in the USA is hidden away in corporate profits and other manipulations. None the less, the data suggests that if wealth in the USA were to be redistributed entirely equally, each person would have only about $50,000. That would be a significant pay increase for most Americans. But is it as a radical change as most socialists promise? In other words, according to economic statistics, and even taking into account bourgeois distortions, it seems like a more egalitarian economy could certainly deliver a significant pay increase for people throughout the world, but perhaps not as radical a change as suggested by a whole new way of life. So to focus on America, is the promise of socialism a pay increase from $35,000 to $50,000. Not to scoff at the difference such a raise would make in all of our lives. But it does not suggest a radical break with existing economics, simply a few more additional comforts. This is the traditional capitalist argument against not just radical socialists, but even bread and butter trade unionists, that the pie just isn't as big as we imagine, and even if it were split perfectly evenly it wouldn't be that huge a difference. What are your thoughts on this?

And I think it also brings up some Third World Maoist issues. The head of MIM was a math professor fond of statistics, and their basic point is that if you divide up world income equally, the first world has to take a drastic pay cut.

[Bud Struggle]

And I think it also brings up some Third World Maoist issues. The head of MIM was a math professor fond of statistics, and their basic point is that if you divide up world income equally, the first world has to take a drastic pay cut.

That is exactly the case.

[Revolution starts with U]

The problem is you're equating socialism with pure egalitarianism. The point isn't that everyone gets paid "equally." It's that everyone gets paid according to the value they create for the economy.
The problem with the analysis is that you have to first take what is the base minimum income to maintain a family household. You also need to find how much of that number is not a family. The equality only extends to the provisation of base living standards for the population.
So the question is; could we provide everybody with a base living standard (residence, food, health, education), and would there still be money left over their for commodity exchange and research?

[RGacky3]

The other problem is $10 in one country is much much differant than $10 in another country, also that market situations are manipulated considering the money that goes to wastefull things in the market.

So you can't really judge what socialism would look like based on market dollar prices.

For example if markets and profit were taken out of food production, prices would be much much lower, the same with housing and health care.



Quote:
Originally Posted by heiss93 http://www.revleft.com/vb/revleft/buttons/viewpost.gif (http://www.revleft.com/vb/showthread.php?p=2014583#post2014583)
And I think it also brings up some Third World Maoist issues. The head of MIM was a math professor fond of statistics, and their basic point is that if you divide up world income equally, the first world has to take a drastic pay cut.
That is exactly the case.


You have no idea, you only agree with it because it agrees with your narrative, you don't have any clue aobut the actual economic factors, the fact that you agree with this stuff so quickly shows what a tool you are. If someone posted an analysis that said "So thats why America is the best country in the world," you'd immediately agree with it without understanding any of the arguments.

[Bud Struggle]

The other problem is $10 in one country is much much differant than $10 in another country, also that market situations are manipulated considering the money that goes to wastefull things in the market.

So you can't really judge what socialism would look like based on market dollar prices.

For example if markets and profit were taken out of food production, prices would be much much lower, the same with housing and health care. Dont you think that when income gets distibuted equally they might also get around to making prices equal too or with there be another Revolution for that? :D




You have no idea, you only agree with it because it agrees with your narrative, you don't have any clue aobut the actual economic factors, the fact that you agree with this stuff so quickly shows what a tool you are. If someone posted an analysis that said "So thats why America is the best country in the world," you'd immediately agree with it without understanding any of the arguments. Attacking the messenger not addressing message. :rolleyes:

[hatzel]

Why does the pre-revolution GDP matter when the post-revolution GDP will be nothing, nada, diddly-squat? DOWN WITH MONEY!!! :laugh:

Seriously though what's this talk about how capitalism will be fitted in to a socialist society?

[RGacky3]

Dont you think that when income gets distibuted equally they might also get around to making prices equal too or with there be another Revolution for that? :D


The whole dollar system is based on a market system which distorts value, so theres no way of determining living standards under socialism by dividing GDP dollar values.


Attacking the messenger not addressing message.

Have a message, with a defence of it, an explanation or sorts, and some subtance and they'll be a message to attack, you don't put forward anything TO attack.

[turquino]

There would need to be a whole two more planet Earths working for nothing to equalise international wages upwards to the median American household, not to mention the tax on the environment that would entail. Or, to see it another way, an international equalisation of wages through the redistribution of non-wage income would require an additional ~2/3 cut in the American wage to make up the difference.

This strongly suggests that the wage bill in the imperialist countries comprises a portion of the surplus product appropriated from outside the imperialist country. A large majority in the imperialist countries benefits from this exploitative relationship with the oppressed countries. I explained the mechanism behind this a few months ago:

Value is transfered through international trade. The transfer of value is hidden in the prices paid for products. Products made in imperialist countries are overpriced relative to values due to their elevated prices of production (owing to the wage component of the cost of production, rather than a larger total capital). When products of the imperialist country and underdevloped country exchange, the transfer of value is concealed, but the outcome is a larger social product than otherwise possible for the purchaser of the underpriced product, and smaller for the purchaser of the overpriced. In this sense it is an exploitative relationship which the imperialist nation as a whole benfits in. It doesn't take a stretch of the imagination to conclude that a large portion of the nation's working class is implicated, and that it is an objective basis for an observed lack of international solidarity.And a response to criticism: http://www.revleft.com/vb/showpost.php?p=1858315&postcount=65 (http://www.revleft.com/vb/another-view-third-t140405/index.html?p=1858315#post1858315)

[Sir Comradical]

And I think it also brings up some Third World Maoist issues. The head of MIM was a math professor fond of statistics, and their basic point is that if you divide up world income equally, the first world has to take a drastic pay cut.

Yes, but the income inequalities between countries become insignificant when compared to the income inequalities between classes.

[Revolution starts with U]

That's basically the jist. Most american standards would remain about where they are. The drops would be insignificant. It is only those at the top, maybe 20% of the population that would see anything drastic.

[RGacky3]

There would need to be a whole two more planet Earths working for nothing to equalise international wages upwards to the median American household

Problem with that is your missing HUGE factors, for example, the United States has a lot of million and billionares, which distory the median number.

Your also missing the GIANT amount of GDP that goes to stuff that does'nt do anything for living standards, military spending, the financial industry, and so on (those are VERY significant parts of the economy).

Your also missing out, price manipulations, in the US median income is much higher, because cost of living is much higher, that cost of living difference is artificial.

If have the same mode of production (what I mean by that, is for profit and market based), and then trying and redistribute everything your gonna something like what you described, but when you change the economic control and the economic mode of production you change the whole structure and tons and tons of market waste gets eliminated as does artificial market manipulations (that hurt working people).


That's basically the jist. Most american standards would remain about where they are. The drops would be insignificant. It is only those at the top, maybe 20% of the population that would see anything drastic.

I'd submit that it would probably only be the top 5%, with the waste in the military and financial industries, and ending profits, maybe less.

[turquino]

Problem with that is your missing HUGE factors, for example, the United States has a lot of million and billionares, which distory the median number.

Your also missing the GIANT amount of GDP that goes to stuff that does'nt do anything for living standards, military spending, the financial industry, and so on (those are VERY significant parts of the economy).

Your also missing out, price manipulations, in the US median income is much higher, because cost of living is much higher, that cost of living difference is artificial.

If have the same mode of production (what I mean by that, is for profit and market based), and then trying and redistribute everything your gonna something like what you described, but when you change the economic control and the economic mode of production you change the whole structure and tons and tons of market waste gets eliminated as does artificial market manipulations (that hurt working people).



I'd submit that it would probably only be the top 5%, with the waste in the military and financial industries, and ending profits, maybe less.
1.Did you think I wrote mean rather than median? It’s not an average, it’s the middle value of all household incomes which happens to be ~ $50 000. The number of millionaires doesn’t distort that in any way.

2.I generously assume nominal GDP includes government expenditures and expenditures from non-wage incomes, then equally redistributed to the wage-earning population (~40% of the world). The sum I came to was ⅓ the American median wage. I already know mine is unrealistic because it assumes the entire stock is consumed by the end of the year, and no labour is allocated to the upkeep and fabrication of new means of production. In reality a global-level wage is probably closer to ¼.

3.Cost of living has less impact than you think. This is a table from 1975-2008 (http://www.jussemper.org/Resources/Labour%20Resources/t4rsrcslbr.html) showing nominal and real compensation for line-manufacturing wages in different countries. Compare ‘middle-income’ Mexico or Brazil next to the industrialised countries. I’ve yet to see evidence that the cost of living comes remotely close to making up the wage difference.

[RGacky3]

it’s the middle value of all household incomes which happens to be ~ $50 000. The number of millionaires doesn’t distort that in any way.


Yes it does, actually, the more millionairs there are, and the higher their income, the further up the medium income is.


2.I generously assume nominal GDP includes government expenditures and expenditures from non-wage incomes, then equally redistributed to the wage-earning population (~40% of the world). The sum I came to was ⅓ the American median wage. I already know mine is unrealistic because it assumes the entire stock is consumed by the end of the year, and no labour is allocated to the upkeep and fabrication of new means of production. In reality a global-level wage is probably closer to ¼.


The military expendiature does not get back to wage earners, it goes to military contractors.

Also take in to account the financial industry, you have a GIANT amount of dollar wealth production which does not benefit the actual production or actual economy at all.

So this inflates the prices of things that people need.

If ALL the GDP went toward things that benefit the public and all of it was non-profit, production cost, and prices would drop significantly, as would waste.


3.Cost of living has less impact than you think. This is a table from 1975-2008 (http://www.anonym.to/?http://www.jussemper.org/Resources/Labour%20Resources/t4rsrcslbr.html) showing nominal and real compensation for line-manufacturing wages in different countries. Compare ‘middle-income’ Mexico or Brazil next to the industrialised countries. I’ve yet to see evidence that the cost of living comes remotely close to making up the wage difference.

I absolutely agree, Mexico's cost of living is also inflated (just look at the 2007 food crisis), but keep in mind food pirces, energy prices and housing prices are where the cost of living needs to begin, In the US those are way inflated, but their wages more than make up for it (at least they used to), in Mexico those are much cheaper, however beyond that things get more expensive, so with their lower wages they can't get any further.

(this is of coarse generalization for arguments sake).

[Jalapeno Enema]

For convenience, I shall use your U.S. model. However, naturally the goal is to incorporate a global redistribution, in which case much of American wealth is redistributed globally.

The problem with the model, however, is thinking in terms of money at all. $1 is a representation of wealth, but completely worthless in of itself. Take the inflation/deflation that would ensue, the disparity not only between individuals, but of regions, take costs of living. I could pay $440 rent here in St. Louis, but in NYC or California, you better believe the apartment would be quite more expensive.

These, as well as factors listed above, would have to be factored into the equation. Don't think of "everybody gets $xx,xxx". Any current monetary unit, even if used initially after revolution, would be an obsolete concept; you cannot assume $1 now equals $1 then. Think of it simply as everybody splits work fairly, and the proceeds fairly.

Perhaps some extravagant luxury options are unfeasible post-revolution. Comfort yourselves with the knowledge that the elimination of the oh-so-profitable consumer markups would mean a little wealth goes a long way.

[PhoenixAsh]

I think it is a highly theoretical debate.

The mode of production is still capitalist. So the GDP is a culmunation of the capitalist mode of production and thus profit accumulation and interest. A lot of the GDP is thus established by something that would not exist in a socialist mode of production.

It can not simply be taken as an exit point for calculting anything for socialist societies.

What it does serve is to show the incredible amount of income disparity between theoretical income and reality.

[Dean]

This is basically meaningless. The production and buying power available atm does not even seek to accommodate for the whole world working class, so an even division of the same will obviously lead to problems where distribution to the working class is robust.

What redistribution of buying power will do is create expansive demand for goods which will translate in more production which is in turn more focused on consumer goods.

[PhoenixAsh]

In turn overproduction and overvalue of goods will be reduced.