Supply and demand

[NorwegianCommunist]

I know this is a left political forum, I come in peace and only want your insight on this matter, please write your idea on why this is right/wrong! :)

Is it wrong to let supply and demand decide the prices of products and services?

It seems like it is the most natural way for products and services to get the right price.

If demand increases and supply remains unchanged, a shortage occurs, leading to a higher equilibrium price.
If demand decreases and supply remains unchanged, a surplus occurs, leading to a lower equilibrium price.
If demand remains unchanged and supply increases, a surplus occurs, leading to a lower equilibrium price.
If demand remains unchanged and supply decreases, a shortage occurs, leading to a higher equilibrium price.

Doesn't this seem fair?
I also know that people who support the left side of politics often think of the poor people, the people that can't afford products or services even though prices would be in a constant change to meet the market.
If people dont buy it the prices would drop so there is a reason why the price of this and that service or product has that exact price isn't it?

Picture yourself that fore example Europa and North America is a libertarian society.
The government doesn't interfere with prices, taxes etc.
People would have to buy insurance to cover medical help, dentist, hospital stay etc.
When people actually need help, they already have insurance that cover all of these costs.
Just like when you have car insurance, it is not too expensive, and there are many different insurance companies you can choose from who offer different things and have different prices.
The insurance company will most likely not run out of money because more people pay for insurance than they actually have to use their money to help those who have a car crash or incident that requires money from the insurance company.
So you dont have to spend enormous amount of money to get this covered because if everybody had to get insurance to cover this, the prices would have to meet the market and choose a right price because of the competition.

I live in Norway and I can say that everybody in Noway who has a job pay 20/35% taxes of only they salary. Also 25% on almost everything you buy, like groceries, cars, bicycles, furniture etc.
So taxes come from everything we buy.
If all of these taxes where removed we would have much more of our salary left, which could easily be spent on a good insurance that cover everything you need, if you have a accident and need a doctors appointment, hospital stay, or dentist appointments.

Hope you understood my examples, please give me your thoughts and maybe we can have a peaceful exchange of words.
I dont mean to fill your forum with libertarian thoughts, but only want to learn more about what you think.
Have a nice day people :)

[Anglo-Saxon Philistine]

Is it fair? That depends on what criteria you use to judge what "fair" is. Undoubtedly it is fair according to some set of criteria and not according to others. But whether it's fair or not is irrelevant. What is relevant is that this is not how capitalism works. Prices are determined, not by the blatantly unworkable law of supply and demand (in fact one could characterise bourgeois economics as a series of ad-hoc hypotheses trying to save this "law" - and failing) but by the average socially-necessary labour time needed to produce the commodity in question.

Second, whether it's fair or not is besides the point, and socialists don't want a "fair" or "optimal" price for commodities. Socialism is the revolutionary abolition of commodity production in general, of production not for human need but for sale on the market. In socialism there will be no markets and no prices. And the basis of socialism is not the "fairness" or "goodness" of a society with no market but the objective interest of the proletariat, the last revolutionary class, the direct producers who make everything and have almost nothing, in the overthrow of the present system.

[Asero]

What is relevant is that this is not how capitalism works. Prices are determined, not by the blatantly unworkable law of supply and demand (in fact one could characterise bourgeois economics as a series of ad-hoc hypotheses trying to save this "law" - and failing) but by the average socially-necessary labour time needed to produce the commodity in question.


By what is the price of a commodity determined?
By the competition between buyers and sellers, by the relation of the demand to the supply, of the call to the offer. The competition by which the price of a commodity is determined is threefold...
Let us suppose that there are 100 bales of cotton in the market and at the same time purchasers for 1,000 bales of cotton. In this case, the demand is 10 times greater than the supply. Competition among the buyers, then, will be very strong; each of them tries to get hold of one bale, if possible, of the whole 100 bales. This example is no arbitrary supposition. In the history of commerce we have experienced periods of scarcity of cotton, when some capitalists united together and sought to buy up not 100 bales, but the whole cotton supply of the world. In the given case, then, one buyer seeks to drive the others from the field by offering a relatively higher price for the bales of cotton. The cotton sellers, who perceive the troops of the enemy in the most violent contention among themselves, and who therefore are fully assured of the sale of their whole 100 bales, will beware of pulling one another's hair in order to force down the price of cotton at the very moment in which their opponents race with one another to screw it up high. So, all of a sudden, peace reigns in the army of sellers. They stand opposed to the buyers like one man, fold their arms in philosophic contentment and their claims would find no limit did not the offers of even the most importunate of buyers have a very definite limit.
If, then, the supply of a commodity is less than the demand for it, competition among the sellers is very slight, or there may be none at all among them. In the same proportion in which this competition decreases, the competition among the buyers increases. Result: a more or less considerable rise in the prices of commodities.
It is well known that the opposite case, with the opposite result, happens more frequently. Great excess of supply over demand; desperate competition among the sellers, and a lack of buyers; forced sales of commodities at ridiculously low prices...
...We have seen how the changing relation of supply and demand causes now a rise, now a fall of prices; now high, now low prices.
https://www.marxists.org/archive/marx/works/1847/wage-labour/ch03.htm

u w0t

[Anglo-Saxon Philistine]

Sure, Marx uses the expression, but read what he's saying. For bourgeois economics, prices are the result of the equilibrium between supply and demand. In Marxist economics, the equilibrium never happens; the interplay of supply and demand is such that they are constantly in disproportion (and in all cases simply result in fluctuations around the value of the commodity). Preobrazhensky talks about it quite a bit in The New Economics, e.g.:

"Let us suppose that in a certain capitalist country there is under-production of leather footwear in comparison with the existing effective demand for this commodity on the market. First, the disproportion is revealed post factum, after the increased demand has come into existence. It could not happen otherwise where there is no social organization of production, no estimation of the dimensions of production and of effective demand. True, capitalist society has worked out its palliative methods of estimating future demand, but they only mitigate the inevitable fluctuations without being able to eliminate them, in so far as the system of distribution of productive forces remains a system of commodity economy. (Under monopoly capitalism, which means an increase in the organized character of production and exchange on the same capitalist basis, estimation of production, and to some extent also of effective demand, is of course carried out better than under completely free competition.)

The increased demand causes an increase in the prices of footwear and consequently leads to an unforeseen re-distribution of the national income (involving surprises which are pleasant to some and unpleasant to others), different from what it would have been if there had been equilibrium between supply and demand. After this comes an increase of production in the existing enterprises of the leather industry, an influx of new capital, perhaps fresh construction. Just as the amount of additional demand was not exactly known, because previously, before the market gave warning, the fact of under-production was not known, so the additional production may overflow, and usually does overflow, the limits of the additional demand, the phase of under-production thus being succeeded by a phase of overproduction, with a consequent fall in prices, a new spontaneous redistribution of the national income and of capital between different branches of production, and so on into the next disproportion. Any correspondence between supply and demand happens by accident; disproportion one way or the other is the rule. This is the way in which, through the operation of the law of value, the necessity of attaining equilibrium between production and effective demand asserts itself. The laws of man's social activity in the sphere of production confront the agents of production as forces external to themselves, blind, uncontrolled forces of nature. Just as, in order that equilibrium may be achieved in any system, a regulator is needed in the sphere of reality, a regulator specific to the given system alone, so also, in order to understand all this mechanism and the regularities peculiar to it, we need specific methodological procedures."

(This is also why the so-called transformation problem is irrelevant.)

And even if you think Marx understood prices to be formed by what is called the supply and demand law in bourgeois economics, the fact would remain that he was wrong. That is not how prices are formed, which is why wages don't drop as more people are born (or as immigrants arrive in one area).

[Alet]

Is it wrong to let supply and demand decide the prices of products and services?

No, it is not "wrong", because supply and demand cause price fluctuations, which are relevant for maximizing the profit. If it is morally wrong, is another matter, which we should not really care about. The fact is that price fluctuations according to supply and demand are necessary for a market economy, and we are not going to change the laws of the market as man does not determine these. Our goal is to abolish the distribution by markets and replace it with a planned production according to needs, but not because we criticize the present distribution on a moral level. However, what is much more interesting than price fluctuations is the exchange value, which is determined by the average amount of work needed to produce a commodity. This implies that an increase of productivity, for example by machines, requires the production of more use values, as the exchange value of a single commodity drops. Would you describe this as "fair" or "right"?

As for the rest of your text, you are basically repeating liberal arguments. Yes, obviously you would have more money, if you did not have to pay taxes, but just ask yourself, where would you be without social security? Of course, one might think that the government wastes money, and yes, we still have to oppose the state as such, but it is a historical achievement of the working class that for example in Germany everybody is guaranteed a health insurance. As for state intervention in general, it is a result of markets and not an act of despotism. I consider it to be a necessary element of present capitalism. Also, competition will not magically fulfill the needs of the people - or maybe it can in part, but why can it and at what cost? First, many needs are the result of capitalist production or competition itself - just think of marketing, that is an obvious example. Second, it is not a secret that every competition involves winners and losers. To assume that it can assure general wealth is therefore questionable. Our point is that there should not be competition in the first place, not because we consider it to be "ineffective", but because an unalienated society requires a social economy.

[Sewer Socialist]

Wouldn't a centrally planned economy, at least a well- functioning one, respond to demand at least as much as liberal economies, if not more?

It certainly wouldn't need to manufacture desire through advertising.

[Anglo-Saxon Philistine]

Wouldn't a planned economy, at least a well- functioning one, respond to demand at least as much as liberal economies, if not more?

Yes, the idea is surely to fulfill human need completely - so ideally, the satisfaction of demand would be 100%. However note that in this case the demand, or need, would be assessed ex ante, so there is no parallel to the so-called law of supply and demand where the two are supposed to reach equilibrium ex post through changes in pricing.

[Jacob Cliff]

Is it fair? That depends on what criteria you use to judge what "fair" is. Undoubtedly it is fair according to some set of criteria and not according to others. But whether it's fair or not is irrelevant. What is relevant is that this is not how capitalism works. Prices are determined, not by the blatantly unworkable law of supply and demand (in fact one could characterise bourgeois economics as a series of ad-hoc hypotheses trying to save this "law" - and failing) but by the average socially-necessary labour time needed to produce the commodity in question.

Second, whether it's fair or not is besides the point, and socialists don't want a "fair" or "optimal" price for commodities. Socialism is the revolutionary abolition of commodity production in general, of production not for human need but for sale on the market. In socialism there will be no markets and no prices. And the basis of socialism is not the "fairness" or "goodness" of a society with no market but the objective interest of the proletariat, the last revolutionary class, the direct producers who make everything and have almost nothing, in the overthrow of the present system.
I'm confused – I thought supply and demand were how prices are determined? How does the socially necessary labor time change the price of a commodity? (Not arguing, just learning more).

[contracycle]

I'm confused – I thought supply and demand were how prices are determined? How does the socially necessary labor time change the price of a commodity? (Not arguing, just learning more).

Consider that the aggregate price of a car, across all times and places in which cars have been produced, has been substantially higher than the price of a toothbrush, across ditto.

Why should this be? The law of supply and demand, ALONE, cannot explain this.

The underlying physical reality is that it takes more time and effort to make a car than to make a toothbrush, and this is reflected in the real prices for which they are exchanged.

And we may note that a whole bunch of other things have the same sort of relationship. A house, for example, is also always much more expensive than a toothbrush. I could go on an on in this vein, but it would be redundant. Supply and demand alone has no explanation for these remarkably consistent "coincidences".

[contracycle]

Doesn't this seem fair?


I have something for you to consider, NorwegianCommunist.

Back when you were a kid, your were probably taught about prices and property and so in a framework that went something like this:

"Imagine you a farmer who produces apples, and you want to exchange your apples for the fish produced by that fisherman". From this establishing setup, the process of supply and demand, the legitimacy of property rights, the utility of money, etc., is all explained.

Does this sound familiar?

But now consider this: whats missing from that picture?

There are no workers. Everybody in that scenario is a capitalist who owns their own means of production. The vast majority of humanity is completely invisible.

Your question was about price, and that is understandable, as that is precisely how all conventional economic discourse is framed. But I think it's important to realise that this whole construct was made by and for the capitalist class. It does not and cannot represent the interests and concerns of workers.

So your idea, in which "free" trade is going to make life better for ordinary people, is a pipe dream, because they simply are not part of this price-based scenario. This is the fundamental failure of the capitalist, and by extension the Libertarian, analysis.

I don't mean this as a slam. I recognise that many people are drawn to Libertarianism because they have realised that something is wrong with the way economics works today, and they are looking for an alternative. But I would say to you that I think the idea that some "pure" form of capitalism is the answer is doomed, precisely because of the above; precisely because it is an ideology that is only relevant to the rich.

[Jacob Cliff]

Consider that the aggregate price of a car, across all times and places in which cars have been produced, has been substantially higher than the price of a toothbrush, across ditto.

Why should this be? The law of supply and demand, ALONE, cannot explain this.

The underlying physical reality is that it takes more time and effort to make a car than to make a toothbrush, and this is reflected in the real prices for which they are exchanged.

And we may note that a whole bunch of other things have the same sort of relationship. A house, for example, is also always much more expensive than a toothbrush. I could go on an on in this vein, but it would be redundant. Supply and demand alone has no explanation for these remarkably consistent "coincidences".
But I thought Marx argued in Value, Price and Profit that supply and demand did play a factor in price? And toothbrushes are by far more mass produced than cars and houses.

Also: how does the amount of labor embodied in a commodity objectively determine a price? Why does "X hours of labor" dictate that the price of a commodity is, say, $10? Is it not up to the seller to determine the price of something, with the influence of supply and demand persuades him to price something at some price?

[Alet]

But I thought Marx argued in Value, Price and Profit that supply and demand did play a factor in price? And toothbrushes are by far more mass produced than cars and houses.

Also: how does the amount of labor embodied in a commodity objectively determine a price? Why does "X hours of labor" dictate that the price of a commodity is, say, $10? Is it not up to the seller to determine the price of something, with the influence of supply and demand persuades him to price something at some price?

Maybe we should make a difference between value and price. Yes, supply and demand do influence the final price, but to adjust a price you already need one. For example, if every demand is supplied, what determines the price of the commodity? Prices represent the value, which is determined by the amount of labor needed to produce a commodity, but they can fluctuate while the value stays the same, that is because of supply and demand. This is Marx' point in "Value, Price and Profit".
As for your second question, no, it is not really "up to the seller". Of course, if for example wages increase, the capitalist would like to negate it by increasing the prices, but the competitors on the market and the consumers do not care about his costs. Prices are fixed on the market and not in the company. If it was up to the seller, prices would be random, but they are not.

[Strannik]

Both supply and demand are measured in money. In conditions of private property, I can decrease the supply and therefore increase price. Increased price leads to greater income, increasing my ability to demand. The fundamental question is the question of property, not markets. Markets are a mechanism for social mediation for value, but they are not the only mechanism. It is conceivable, that early socialist society uses markets, but in is inconceivable that a socialist society upholds privacy of property. Even if there was a market, the books would be open to all participants. Doesn't libertarian "perfect market" presuppose total symmetry of information? How would it be possible, if property is private?

[Luís Henrique]

Is it wrong to let supply and demand decide the prices of products and services?

"Wrong" in exactly what sence? Morally wrong? Wrong from the point of view of a smooth functioning of the economy? Wrong from the point of view of an adequate and efficient distribution of economic goods? These are different questions, that demand different answers.


It seems like it is the most natural way for products and services to get the right price.

Hm. In such case, it would be the most natural way for... doing something completely artificial. Why should products and services have a price, never mind a "right" one?


If demand increases and supply remains unchanged, a shortage occurs, leading to a higher equilibrium price.
If demand decreases and supply remains unchanged, a surplus occurs, leading to a lower equilibrium price.
If demand remains unchanged and supply increases, a surplus occurs, leading to a lower equilibrium price.
If demand remains unchanged and supply decreases, a shortage occurs, leading to a higher equilibrium price.

Yes, it is nice on the paper. In real life, this means people not being able to buy food, losing their jobs, etc. It can be a very ugly and dirty thing.


Doesn't this seem fair?

Yes, it looks fair, in the sence in which in a shipwreck the good swimmers help themselves to the shore, and the lousy swimmers drown while trying. Should we disallow that, and by some magic make the worst swimmers outcompete the best ones?

... or should we think of it in terms of improving the safety of ships?


I also know that people who support the left side of politics often think of the poor people, the people that can't afford products or services even though prices would be in a constant change to meet the market.
If people dont buy it the prices would drop so there is a reason why the price of this and that service or product has that exact price isn't it?

Yes, of course. Prices are a function of demand, which means if food is expensive it is the fault of people who insist in eating, instead of starving until the prices get lower...

Prices have different "elasticity" regarding demand (and supply). Food will be demanded until people die of starvation - which means that if it is too expensive for certain layers of people, those will have to starve (or to steal, or to revolt, but I guess that the average marginalist economist doesn't factor such alternatives in their elegant mathematical formulas). It is not like tennis shoes, which ideally we can boycott until they come to the price at which we can buy them. Electrical power supply at times can only be raised by building a whole new hydro plant, which means not until some years into the future.


Picture yourself that fore example Europa and North America is a libertarian society.
The government doesn't interfere with prices, taxes etc.
People would have to buy insurance to cover medical help, dentist, hospital stay etc.
When people actually need help, they already have insurance that cover all of these costs.

And then the government will have to interfere with prices, in order that the wage of every worker must be enough to pay for insurance. And then with the spending of individual workers, in order that every worker does indeed buy his or her insurance. Or are we prepared, as a society, to allow a person who is dying in the streets to be refused by hospitals because they don't have insurance?


The insurance company will most likely not run out of money because more people pay for insurance than they actually have to use their money to help those who have a car crash or incident that requires money from the insurance company.

The insurance company will most likely run out of money because they will lower their prices to outcompete their rivals. In order to avoid that, they will lower the quality of their service - and that is the time you discover that the fine print in your contract provides an exception for the disease you actually have. Unless of course the government interferes with that.


I live in Norway and I can say that everybody in Noway who has a job pay 20/35% taxes of only they salary. Also 25% on almost everything you buy, like groceries, cars, bicycles, furniture etc.
So taxes come from everything we buy.

It is like that in Brazil, too - and I suppose in most capitalist countries.


If all of these taxes where removed we would have much more of our salary left, which could easily be spent on a good insurance that cover everything you need, if you have a accident and need a doctors appointment, hospital stay, or dentist appointments.

You would also have to pay from your wage for things that I suppose you take for granted, such as paved streets, garbage collection, electric power, etc.


Have a nice day people :)

:)

Luís Henrique

[Luís Henrique]

I thought supply and demand were how prices are determined? How does the socially necessary labor time change the price of a commodity?

Yes, supply and demand do determine prices. This is true, but is absolutely superficial. Like saying that "the Sun rises in the East".

The question is, what determines supply and demand? Socially necessary labour time does. It determines supply, because if it takes so much time to produce a given commodity, then only so many units of it will be produced (and if it takes the half the time, then we can produce twice of them). And it determines demand, because demand directly depends on how much labour time society is prepared to spend producing commodities to exchange for the given commodity. Ie, a Ferrari can cost $ 200,000 because we (socially) agree to produce $ 200,000 of tomatoes, loaves of bread, houses, linen, ships, microcomputers, etc., in exchange for a Ferrari (and, of course, we only agree to that because the amount of labour required to produce a Ferrari is the same required to produce $ 200,000 of microcomputers, ships, linen, houses, etc).

Luís Henrique

[Anglo-Saxon Philistine]

But I thought Marx argued in Value, Price and Profit that supply and demand did play a factor in price? And toothbrushes are by far more mass produced than cars and houses.

Also: how does the amount of labor embodied in a commodity objectively determine a price? Why does "X hours of labor" dictate that the price of a commodity is, say, $10? Is it not up to the seller to determine the price of something, with the influence of supply and demand persuades him to price something at some price?

Of course it's up to the seller to determine the price, and to the buyer to determine if they want to pay it. But these decisions don't happen in a vacuum; just like the molecules in a body of gas exhibit interesting and tractable macroscopic behaviour, prices exhibit interesting and tractable trends even though we can't and aren't interested in following every individual buyer and seller and their psychologies.

In bourgeois economics, the price is determined when supply and demand reach equilibrium. The price is then the quantitative expression of that equilibrium; this is the "law of supply and demand". For Marxists, the main part of the price is determined by the value, as this is the point where the tendency of the sellers to undercut each other by lowering prices reaches its limit - if they sell for less than the value they sell at a loss. Around this mean, there exist fluctuations, and supply and demand are among the factors that influence these fluctuations, but unlike in bourgeois economics, Marxists assume that supply and demand are always in disproportion. This is why it doesn't make sense to talk of the law of supply and demand without qualification when it comes to Marx.


Both supply and demand are measured in money. In conditions of private property, I can decrease the supply and therefore increase price. Increased price leads to greater income, increasing my ability to demand. The fundamental question is the question of property, not markets. Markets are a mechanism for social mediation for value, but they are not the only mechanism. It is conceivable, that early socialist society uses markets, but in is inconceivable that a socialist society upholds privacy of property.

Well, no, it is not conceivable that any kind of socialist society should use markets, precisely because markets are associated with value. And there is no value in socialism, because there is no commodity production in socialism.

[blake 3:17]

I'll preface my comments, below by saying that the above discussion seems to ignore the role and cost of bureaucracy. Paperwork is expensive!

As socialists, we should unilaterally reject the market as the model for goods and services.

At the same time, I see nothing wrong with using certain market mechanisms to evaluate what goods and services are produced and provided, largely to prevent stupid blunders of over production and under production. Central plans may seem ideal, but if you produce three or four times what gets used consistently, and the rest gets thrown in the garbage, and meanwhile other needs aren't being met, that's just stupid.

Most of my work involves petty commodity production and front line social service work. There are ups and downs in terms of the demands. Trying to meet every possible demand (aka please everybody) is a bit of a recipe for disaster -- the quality detiorates, workers burn out, health and safety go down -- but it's also a total sham to create products and services that nobody uses and wait endlessly for the masses to appear.

There are a couple of curious cases in Toronto of under serviced neighbourhoods where seemingly positive public health initiatives have popped up and like nobody uses them. They're free. And people stay away in large numbers. My suspicion is that they were planned too top down. I started an art program in one of the neighbourhoods and it worked beautifully but things change.

[Anglo-Saxon Philistine]

I'll preface my comments, below by saying that the above discussion seems to ignore the role and cost of bureaucracy. Paperwork is expensive!

That it is, at least in capitalism, but this is simply one of those costs that the capitalist incurs. Rents are another example of these extraneous costs, and sometimes they can get pretty ridiculous (not that we generally care if capitalists are forced to pay ridiculous prices). This contributes to the fluctuation of prices. But it can't push them significantly above or below the value because no one would buy from such a firm.

(Of course in socialism there is no bureaucracy as administration is not done by a special body of men, a stratum separate from the general population, but by everyone.)


As socialists, we should unilaterally reject the market as the model for goods and services.

At the same time, I see nothing wrong with using certain market mechanisms to evaluate what goods and services are produced and provided

That's completely contradictory. All market mechanisms are variations on the sale of commodities. Free, forced, yadda yadda yadda, it doesn't matter. You can't have market mechanisms without sales which - one, is incompatible with socialism, and two, contradictory to the notion that socialists should reject the market.


largely to prevent stupid blunders of over production and under production. Central plans may seem ideal, but if you produce three or four times what gets used consistently, and the rest gets thrown in the garbage, and meanwhile other needs aren't being met, that's just stupid.

That is why any society where production is scientifically planned to satisfy human need needs to predict aggregate demand. And obviously we are going to overproduce, as any prediction has its inherent uncertainties and when all is said and done, it's better to have told the factories to produce too much tagliatelle than too little.

[Luís Henrique]

All market mechanisms are variations on the sale of commodities. Free, forced, yadda yadda yadda, it doesn't matter. You can't have market mechanisms without sales which - one, is incompatible with socialism, and two, contradictory to the notion that socialists should reject the market.

If we define "socialism" as a classless, moneyless society, then it is obviously contradictory. If we define "socialism" as a transitional phase between capitalism and communism, then not so much.

But anyway, we will need some kind of transition; the day following The Revolution people will still want to eat bread, and a provisional power that does not put bread into people's baskets is likely to be extremely provisional.

Luís Henrique

[Anglo-Saxon Philistine]

If we define socialism in this manner, we're speaking in another language. Fair enough by itself; you can use whatever sounds you please to refer to the period of transition, but it does strongly hint at the stale stagism of the Second International and of the Stalinised ComIntern.

And of course markets still exist in the transition, as markets can't be abolished by fiat in one country. The reason markets will be retained, however, is not their superiority (obviously markets are terrible when it comes to allocating goods and services to satisfy human need) but the need to participate in the global market.

After the revolution has won globally, there is no need for markets and it would be a very peculiar society that would retain markets to satisfy the fetishes of American internet-goers.

[Strannik]

Well, no, it is not conceivable that any kind of socialist society should use markets, precisely because markets are associated with value. And there is no value in socialism, because there is no commodity production in socialism.

Yes, this was pretty stupid I wrote yesterday. I tried to oversimplify while drunk.
Communars do not need to know market value of things, because they have direct relationships with world and others around them. Individually useful items do not appear magically on store shelves, they are made, maintained and used by people in direct relationships with each other as producers/consumers. As such, Commune does not need a "mechanism for mediation of (abstract) social value". Optimal collective strategies of production and consumption appear as the natural sum of decisions of individuals in social relations with each other. The only thing similar to market here is that socialist planning is as inclusive, continuous and dynamic as peoples relations to market under capitalism.

I have read Marx for quite a few years now, but it's always an effort to hold his vision in my head.

[NorwegianCommunist]

Is it fair? That depends on what criteria you use to judge what "fair" is. Undoubtedly it is fair according to some set of criteria and not according to others. But whether it's fair or not is irrelevant. What is relevant is that this is not how capitalism works. Prices are determined, not by the blatantly unworkable law of supply and demand (in fact one could characterise bourgeois economics as a series of ad-hoc hypotheses trying to save this "law" - and failing) but by the average socially-necessary labour time needed to produce the commodity in question.

Second, whether it's fair or not is besides the point, and socialists don't want a "fair" or "optimal" price for commodities. Socialism is the revolutionary abolition of commodity production in general, of production not for human need but for sale on the market. In socialism there will be no markets and no prices. And the basis of socialism is not the "fairness" or "goodness" of a society with no market but the objective interest of the proletariat, the last revolutionary class, the direct producers who make everything and have almost nothing, in the overthrow of the present system.


In socialism there will be no market or no prices?
What is the point of that? So people can´t buy things or services they want?
Everybody wants different products or services, is there something wrong with that?
And do you seriously mean that capitalism doesn work by supply and demand?
Well okey, then how does marketeconomics work? not capitalism, but marketeconomy?

[NorwegianCommunist]

No, it is not "wrong", because supply and demand cause price fluctuations, which are relevant for maximizing the profit. If it is morally wrong, is another matter, which we should not really care about. The fact is that price fluctuations according to supply and demand are necessary for a market economy, and we are not going to change the laws of the market as man does not determine these. Our goal is to abolish the distribution by markets and replace it with a planned production according to needs, but not because we criticize the present distribution on a moral level. However, what is much more interesting than price fluctuations is the exchange value, which is determined by the average amount of work needed to produce a commodity. This implies that an increase of productivity, for example by machines, requires the production of more use values, as the exchange value of a single commodity drops. Would you describe this as "fair" or "right"?

As for the rest of your text, you are basically repeating liberal arguments. Yes, obviously you would have more money, if you did not have to pay taxes, but just ask yourself, where would you be without social security? Of course, one might think that the government wastes money, and yes, we still have to oppose the state as such, but it is a historical achievement of the working class that for example in Germany everybody is guaranteed a health insurance. As for state intervention in general, it is a result of markets and not an act of despotism. I consider it to be a necessary element of present capitalism. Also, competition will not magically fulfill the needs of the people - or maybe it can in part, but why can it and at what cost? First, many needs are the result of capitalist production or competition itself - just think of marketing, that is an obvious example. Second, it is not a secret that every competition involves winners and losers. To assume that it can assure general wealth is therefore questionable. Our point is that there should not be competition in the first place, not because we consider it to be "ineffective", but because an unalienated society requires a social economy.


"No, it is not "wrong", because supply and demand cause price fluctuations, which are relevant for maximizing the profit"
For maybe a few companies,, but there will always be competition, so other companies would have similar product/services at maybe a cheaper price, so people dont have to buy the product that gives the most profit for the company.

"Our point is that there should not be competition in the first place, not because we consider it to be "ineffective", but because an unalienated society requires a social economy"

When people say that competition is wrong or shouldnt be present, i dont know what to think...
Competition is vey very effective. This causes the world to move forwards. If there are no profits in new products/services, innovation etc. WHY would people use 100´s or 1000´s of hours trying to develop something that people want?
People who work this hard and sacrifice so much wants something in return.
They dont want only PR or a pat on the shoulder.
They want money as a reward.

I don´t think there would be cars, airplanes, televisions, cellphones, internet, facebook etc if there were no reward in the process or aftermath of making it.

[NorwegianCommunist]

Wouldn't a centrally planned economy, at least a well- functioning one, respond to demand at least as much as liberal economies, if not more?

It certainly wouldn't need to manufacture desire through advertising.

I personally don´t think centrally planned economics would cover the need of EACH individual in the market.
Everybody wants different products/services each year, month and day.
Would planned economics see this coming?
Maybe planned economics would cover needs such as bread, butter, milk, sacks of hay etc.
But people dont want only a few things, everybody wants a ton of different things.
So this could not possibly cover the current needs of people living in the 21st century.

If it was a part of your ideology to live like they did 100-200 years ago and stay that way, then I understand why you want planned economics.
As of covering the needs of people in all markets in 21st century you need competition to move forward in the society.
Competition makes prices go up and down depending on supply and demand and weather people are happy with the products or not. (because of the rumor it gives the producers)

[NorwegianCommunist]

Consider that the aggregate price of a car, across all times and places in which cars have been produced, has been substantially higher than the price of a toothbrush, across ditto.

Why should this be? The law of supply and demand, ALONE, cannot explain this.

The underlying physical reality is that it takes more time and effort to make a car than to make a toothbrush, and this is reflected in the real prices for which they are exchanged.

And we may note that a whole bunch of other things have the same sort of relationship. A house, for example, is also always much more expensive than a toothbrush. I could go on an on in this vein, but it would be redundant. Supply and demand alone has no explanation for these remarkably consistent "coincidences".

What about the fact that there might be less houses than there are toothbrushes in a market?
That would be categorized under supply, sir

[NorwegianCommunist]

I have something for you to consider, NorwegianCommunist.

Back when you were a kid, your were probably taught about prices and property and so in a framework that went something like this:

"Imagine you a farmer who produces apples, and you want to exchange your apples for the fish produced by that fisherman". From this establishing setup, the process of supply and demand, the legitimacy of property rights, the utility of money, etc., is all explained.

Does this sound familiar?

But now consider this: whats missing from that picture?

There are no workers. Everybody in that scenario is a capitalist who owns their own means of production. The vast majority of humanity is completely invisible.

Your question was about price, and that is understandable, as that is precisely how all conventional economic discourse is framed. But I think it's important to realise that this whole construct was made by and for the capitalist class. It does not and cannot represent the interests and concerns of workers.

So your idea, in which "free" trade is going to make life better for ordinary people, is a pipe dream, because they simply are not part of this price-based scenario. This is the fundamental failure of the capitalist, and by extension the Libertarian, analysis.

I don't mean this as a slam. I recocgnise that many people are drawn to Libertarianism because they have realised that something is wrong with the way economics works today, and they are looking for an alternative. But I would say to you that I think the idea that some "pure" form of capitalism is the answer is doomed, precisely because of the above; precisely because it is an ideology that is only relevant to the rich.


I have learned similar examples when I was young, but there are also other ways of seeing it.
Weather this farmer of fisher own the means of production or not. They still put in work. I would concider them as workers. Maybe very hard workers too. There are no guaranties that you will catch a fish when fishing. Or that the appleseed would because delicious apples that people ar willing to trade with later.
This is actually a risk these workers take.
This is how I see your example.

[WideAwake]

Hi, I am not an economist, but I think that when the economy is in a recession, like in the present low-wage neoliberal phase of the capitalist system, there is an excess of over-production combined with under-consumption, an excess of supply and lower demands for goods and services. I really don't know what corporations do with all their cars, all the chocolate bars we see in grocery stores, and all the excess of products, all the ice creams, all the snacks you see at the supermarket, that there is no way for people to buy them all



I know this is a left political forum, I come in peace and only want your insight on this matter, please write your idea on why this is right/wrong! :)

Is it wrong to let supply and demand decide the prices of products and services?

It seems like it is the most natural way for products and services to get the right price.

If demand increases and supply remains unchanged, a shortage occurs, leading to a higher equilibrium price.
If demand decreases and supply remains unchanged, a surplus occurs, leading to a lower equilibrium price.
If demand remains unchanged and supply increases, a surplus occurs, leading to a lower equilibrium price.
If demand remains unchanged and supply decreases, a shortage occurs, leading to a higher equilibrium price.

Doesn't this seem fair?
I also know that people who support the left side of politics often think of the poor people, the people that can't afford products or services even though prices would be in a constant change to meet the market.
If people dont buy it the prices would drop so there is a reason why the price of this and that service or product has that exact price isn't it?

Picture yourself that fore example Europa and North America is a libertarian society.
The government doesn't interfere with prices, taxes etc.
People would have to buy insurance to cover medical help, dentist, hospital stay etc.
When people actually need help, they already have insurance that cover all of these costs.
Just like when you have car insurance, it is not too expensive, and there are many different insurance companies you can choose from who offer different things and have different prices.
The insurance company will most likely not run out of money because more people pay for insurance than they actually have to use their money to help those who have a car crash or incident that requires money from the insurance company.
So you dont have to spend enormous amount of money to get this covered because if everybody had to get insurance to cover this, the prices would have to meet the market and choose a right price because of the competition.

I live in Norway and I can say that everybody in Noway who has a job pay 20/35% taxes of only they salary. Also 25% on almost everything you buy, like groceries, cars, bicycles, furniture etc.
So taxes come from everything we buy.
If all of these taxes where removed we would have much more of our salary left, which could easily be spent on a good insurance that cover everything you need, if you have a accident and need a doctors appointment, hospital stay, or dentist appointments.

Hope you understood my examples, please give me your thoughts and maybe we can have a peaceful exchange of words.
I dont mean to fill your forum with libertarian thoughts, but only want to learn more about what you think.
Have a nice day people :)

[NorwegianCommunist]

"Wrong" in exactly what sence? Morally wrong? Wrong from the point of view of a smooth functioning of the economy? Wrong from the point of view of an adequate and efficient distribution of economic goods? These are different questions, that demand different answers.



Hm. In such case, it would be the most natural way for... doing something completely artificial. Why should products and services have a price, never mind a "right" one?



Yes, it is nice on the paper. In real life, this means people not being able to buy food, losing their jobs, etc. It can be a very ugly and dirty thing.



Yes, it looks fair, in the sence in which in a shipwreck the good swimmers help themselves to the shore, and the lousy swimmers drown while trying. Should we disallow that, and by some magic make the worst swimmers outcompete the best ones?

... or should we think of it in terms of improving the safety of ships?



Yes, of course. Prices are a function of demand, which means if food is expensive it is the fault of people who insist in eating, instead of starving until the prices get lower...

Prices have different "elasticity" regarding demand (and supply). Food will be demanded until people die of starvation - which means that if it is too expensive for certain layers of people, those will have to starve (or to steal, or to revolt, but I guess that the average marginalist economist doesn't factor such alternatives in their elegant mathematical formulas). It is not like tennis shoes, which ideally we can boycott until they come to the price at which we can buy them. Electrical power supply at times can only be raised by building a whole new hydro plant, which means not until some years into the future.



And then the government will have to interfere with prices, in order that the wage of every worker must be enough to pay for insurance. And then with the spending of individual workers, in order that every worker does indeed buy his or her insurance. Or are we prepared, as a society, to allow a person who is dying in the streets to be refused by hospitals because they don't have insurance?



The insurance company will most likely run out of money because they will lower their prices to outcompete their rivals. In order to avoid that, they will lower the quality of their service - and that is the time you discover that the fine print in your contract provides an exception for the disease you actually have. Unless of course the government interferes with that.



It is like that in Brazil, too - and I suppose in most capitalist countries.



You would also have to pay from your wage for things that I suppose you take for granted, such as paved streets, garbage collection, electric power, etc.



:)

Luís Henrique



It is just stupidity from your side saying that you will die, because you won´t eat because the prices are too high.
That´s where competition comes into play. There are tons of other companies offering same types at different prices ;) So you can "protes" by buying something else.
Every possible consumer is important for businesses.
thought you would understand this.

How do you mean that supply and demand can lose people their jobs?
Because when the market is competitive, there will be more than one company offering the same product/service. More competition, more workplaces for people. Easy to understand, right?


"Yes, it looks fair, in the sence in which in a shipwreck the good swimmers help themselves to the shore, and the lousy swimmers drown while trying. Should we disallow that, and by some magic make the worst swimmers outcompete the best ones?"

It is a very extreme picture you paint yourself of market economy.
I would not say that people drown and die when living in a market economy society.
Maybe the good swimmers are successful business owners, the the bad swimmers are regular workers. So when they drown, is just another way of saying that they did´nt succeed at becoming successful. Then maybe they would become street sweepers, garbage collectors etc.
By the way. If it saved me from paying 30% taxes as I currently do, I would be more than happy to sweep a few meters of dust outside of my property ;)



"It is like that in Brazil, too - and I suppose in most capitalist countries."
I would not concider Brazil to be an example of a market economic society.
I don´t think you communists are to happy when people say "just look at the soviet, china, cuba and vietnam"
Just because of their planned economy and forced labour I don´t think this is actually your goal.


The insurance you are talking about is very interesting.
I think insurance would be a better solution in terms of health care. Better if people got insurance to cover themselfes (and family example) than for every taxpayer in the country to help them) It would provide insurance so that when people get sick, need a surgery or just a doctors appointment, the insurance company would pay it.
They don´t have to lower their service in terms of the contract you write, is they try to change anything or refuses to pay for your example surgury. Then you could sue them.
When it comes to health insurance you would be dumb not to make someone look it over before signing. It´s not as easy as just a car insurance.
It would most likely be illegal for insurance companies to lower their costs so much that they can´t afford paying for enough people when its needed.
Of course its hard to say, suddenly many many people would become sick or need hospital without the company being prepared, but they would have to find a way to pay for it and later take the consequences. (loans etc)
So it would be smartest to get insurance covering as many diseases as possible, but it would not cost 5,000$ a month.
Insurance companies would explode, everybody needs it, so this would be very attractive at the market.

If someone were to be sick and had the risk of dying, I am sure there will be organizations helping unfortunate prople. Just like there is Red Cross, UN, doctors without borders too.
There is the solution to that problem.

[Anglo-Saxon Philistine]

In socialism there will be no market or no prices?

Yes. In socialism, goods and services are not produced as commodities, to be sold on the market, but directly to satisfy human need.


What is the point of that? So people can´t buy things or services they want?

The point is that they won't need to buy them (and as such, won't). Excepting possibly the first years of the socialist society, socialism is a society of free access, where every member of society takes the goods they want for their personal consumption from the aggregate social product.


Everybody wants different products or services, is there something wrong with that?

There's nothing wrong with that, quite the contrary. And this is why scientific planning of production is necessary, to anticipate demand and to allocate on one hand production targets and on the other hand machinery, raw materials etc. to the various production units ex ante.


And do you seriously mean that capitalism doesn work by supply and demand?

No, I posted all that, and the extensive quote from Preobrazhensky I had to look online because my copy of the New Economics isn't in English, all for a laugh. And the various bourgeois economists that make up ad hoc theories to explain the discrepancy between what they call the law of supply and demand and the actual trends of prices are also doing it all for a laugh.

[Anglo-Saxon Philistine]

Apologies for double-posting, but the quote and edit functions simply don't work for me at the moment.


For maybe a few companies,, but there will always be competition, so other companies would have similar product/services at maybe a cheaper price, so people dont have to buy the product that gives the most profit for the company.

And why do firms compete? They compete to maximise their profits. An important mechanism by which they do so is undercutting the competition, but in the real world they can't do so indefinitely, because there comes a point where they are producing at a loss. This point is given by the law of value and represents the value of the commodity.

So instead of this myth where prices fluctuate wildly we see that real prices represent fluctuations around the mean given by the value.


When people say that competition is wrong or shouldnt be present, i dont know what to think...

Again, we're not saying that competition is "wrong". What is wrong and what is right are not things that concern us. We're saying competition is unnecessary in a society where the means of production are held in common and society scientifically plans production to satisfy human need.


Competition is vey very effective. This causes the world to move forwards. If there are no profits in new products/services, innovation etc. WHY would people use 100´s or 1000´s of hours trying to develop something that people want?

Because they want to. Because doing things can be an expression of the human personality in addition to the odious imposition it is in capitalism (where the worker has to work or starve). For most of the existence of the human species, this was the only reason people did things unrelated to subsistence. No one paid the artist that carved the swimming reindeer figurine from the Magdalenian, for example. (This also happens under capitalism; no one is going to pay you for a new Lagrangian or a new mathematical theorem for example.)


I don´t think there would be cars, airplanes, televisions, cellphones, internet, facebook etc if there were no reward in the process or aftermath of making it.

What's interesting is that the Internet was created, not because of any "incentive" but because the US bourgeois state recognised that there was a need for such a network. There was no immediate profit motive because no one thought they would make money off of ARPANET. The same is true for the development of computers, programming languages etc.

And of course, anyone who has been on the Internet for the last decade or so has seen for themselves how the drive to make money is resulting in the consumers receiving a worse and worse service. But hey, maybe you like all that monetisation bullshit.


I personally don´t think centrally planned economics would cover the need of EACH individual in the market.
Everybody wants different products/services each year, month and day.
Would planned economics see this coming?

Well, that's the point, to assess demand ex ante. All these daily needs correspond to some definite aggregate demand in the period for which we plan (some number of years), and the chief problem is to assess what that aggregate demand is going to be. I.e. how many oranges, how many bananas etc. are going to be consumed in the next year. To a limited degree this is also done by capitalist firms, who want to produce the right amount of the commodity they're selling, but they're hampered by their necessarily partial knowledge of the situation on the ground.


What about the fact that there might be less houses than there are toothbrushes in a market?

What about the fact that there might not be? If I buy off the entire stock of toothbrushes in one area and decide to sell a limited number of toothbrushes with a price tag equivalent to that of a house, no one would buy them. This is why bourgeois economics are crock; unless you carefully arm yourselves with ad hoc corrections you get nonsensical results like house-priced toothbrushes and diamonds being cheaper than water.



Weather this farmer of fisher own the means of production or not. They still put in work. I would concider them as workers.

Good for you? But here, when we say worker, we mean the dispossessed direct producers, who do not own the means of production and are compelled to sell their labour-power.


It is just stupidity from your side saying that you will die, because you won´t eat because the prices are too high.

Because that never happens.

No, actually it happens all of the time. The global production of food is more than enough to give everyone type 2 diabetes and kill us all with coronary disease. That people still starve is because food is distributed, not according to human need (in which case there would be a massive influx of food into Africa, certain parts of Asia etc.) but by market mechanisms.



I would not concider Brazil to be an example of a market economic society.
I don´t think you communists are to happy when people say "just look at the soviet, china, cuba and vietnam"
Just because of their planned economy and forced labour I don´t think this is actually your goal.

Our goal is planning of production. We reject comparisons to China, Cuba etc. because none of these areas is socialist; for one these are all states that participate in the global market. Brazil is capitalist - the Brazilian economy operated by generalised commodity production and wage labour with private ownership of the means of production. It might not be the supper happy pure capitalism you dream of, but that would demonstrably be even worse for workers.

[Luís Henrique]

If we define socialism in this manner, we're speaking in another language. Fair enough by itself; you can use whatever sounds you please to refer to the period of transition, but it does strongly hint at the stale stagism of the Second International and of the Stalinised ComIntern.

Yeah, as long as terminology is our concern (and considering the very basic demand of the OP in terms of information, that's probably the case here), then you are right.

Discussing the transition seems to me more interesting. In this context, where the idea that in communism people won't be able to buy commodities is met with surprise and disbelief, it is probably impossible to do it, though.


And of course markets still exist in the transition, as markets can't be abolished by fiat in one country. The reason markets will be retained, however, is not their superiority (obviously markets are terrible when it comes to allocating goods and services to satisfy human need) but the need to participate in the global market.

I think they will be "retained" because there won't be any immediately available alternative. And that a deliberate and intelligent effort to replace them will be necessary; they won't "wither away" nor can they be magically abolished.

Luís Henrique

ETA: there is some discussion of the subject of transition in this thread, "What else but markets? (http://www.revleft.com/vb/else-but-marketsi-t64110/index.html?t=64110&highlight=starve)"

[Anglo-Saxon Philistine]

I don't think there is any conflict between markets withering away and being consciously replaced - although the phrase "withering away" suggests some kind of automatism, the socialist revolution begins the period where humans control society consciously and explicitly. To me, withering away signifies that the need for the market will lessen as more and more of the world joins the revolutionary area. Then, the mechanisms of conscious planning we will have put into place will strengthen until finally they become generalised throughout the globe.

edit: Well, the edit function is working again. So far its success rate is about the same as that of the mahaman spell in Wizardry, which means I'm old and my references don't make sense to anyone but a tiny minority of people here. In any case, Luis, was there something in particular you wanted to draw my attention to in that thread? I skimmed it, and I think that most of the posters there are talking about something other than what I would call socialism, as I reject the notion that self-management has anything to do with socialism. Quite the contrary, socialism implies that the operation of individual production units is subordinated to a general social plan of production. People then usually have this great big spiel about how Centralisation is Bad, even though the arguments they use could be turned against everything except petty commodity production. But that's irrelevant.

edit strikes back: Actually, if you would like to restart discussion about that, please do. I have to write some code these days, so RL is a good place to procrastinate, and I think it's better than constantly repeating the same things regarding Corbyn, who is giving me indigestion.

[Luís Henrique]

It is just stupidity from your side saying that you will die, because you won´t eat because the prices are too high.

Well, thanks, that's indeed very polite of yours.

But these people would disagree with your Panglossian views:

http://cdn1.yourstory.com/wp-content/uploads/2014/08/Abandoned.jpg


That´s where competition comes into play. There are tons of other companies offering same types at different prices ;) So you can "protes" by buying something else.

Listen, man. Whatever the price of food is, it is a positive (as in, greater than zero) amount of money. Unemployed people do not earn any money, so they cannot buy any food. Unless they are supported by completely un-capitalistic non-market actions (solidarity among family members, parish charity, etc.), they will starve. No competition among different companies can make them give food for free, and no competition among different companies will make them give hire employees beyond those strictly necessary for their own production and functioning (rather on the contrary, competition will make them try and reduce jobs as much as they can).


Every possible consumer is important for businesses.

A "consumer", however, is not a person; it is what Robert Kurz called "money-monad", ie, a person with money. A person without money is not important for business, as you can easily see if you go into any shop and ask for a commodity and tell them that you do not have the money to pay. A person without money, indeed, is invisible to to businesses, unless perhaps as a potential threat.


thought you would understand this.

If I start listing the things a person who proclaims to be a Communist, even if of the "Norwegian" variety, should understand, this thread would quite probably become too long for any practical purpose.


How do you mean that supply and demand can lose people their jobs?

Evidently, if people are no longer interested in the commodities my shop provides, I will have to close, and fire my employees. Supply and demand is not a mere abstraction, you know: it is supply of given commodities, and demand for given commodities. If you work for a company that makes commodities that are going out of demand, you are quite in the risk of becoming jobless. Does that happen? Of course, just look at workers that made LP pick-ups or shops that rented DVDs. Competition made them obsolete.


Because when the market is competitive, there will be more than one company offering the same product/service. More competition, more workplaces for people. Easy to understand, right?

Indeed, easy to understand, but false. More competition, more companies are defeated in competition, leading to less competition; more competition, lower the profits, lower profits, bigger the capital necessary for an upstart.


It is a very extreme picture you paint yourself of market economy.
I would not say that people drown and die when living in a market economy society.

It is of course a metaphor, but I think it is a good one. You are confused because the market economy that you know first-hand (still) has strong non-market mechanisms to alleviate unemployment (a functioning public-health service, jobless insurance, etc.) Take these things out (and this is what your beloved "competition" is demanding) and you will see people starving (and freezing) in the streets of Oslo. Look at what is happening in Athens.


Maybe the good swimmers are successful business owners, the the bad swimmers are regular workers. So when they drown, is just another way of saying that they did´nt succeed at becoming successful. Then maybe they would become street sweepers, garbage collectors etc.

The metaphor can go into different levels. Maybe the good swimmers are succesful business owners, and the bad swimmers are unsuccessful business owners, who "drown" by going bankrupt and back to the ranks of common workers. Or maybe the good swimmers are just common workers, and the bad swimmers are below average workers, who "drown" by going unemployed or over indebted. You live in a rather sheltered society, that has been governed by social-democracy for a longish time. Most of us live outside Scandinavia or German, and either are having our social safety nets quite quickly destroyed by your beloved competition, or never had such nets first place.


By the way. If it saved me from paying 30% taxes as I currently do, I would be more than happy to sweep a few meters of dust outside of my property ;)

You would, until that few meters of dust translated into the very real increase probability of disease - without the public hospitals you are accostumed to, which would also be gone without taxes.


I would not concider Brazil to be an example of a market economic society.

Then I am sorry, you do not have an adequate undertanding of capitalism. But look at my country with much attention: it is quite certainly very similar to the future of your country: your grandchildren will quite probably live in something quite similar to a frigid Brazil, without the samba and the soccer skills, of course.

Unless you stop praising your own downfall, and start taking action against it.


I don´t think you communists are to happy when people say "just look at the soviet, china, cuba and vietnam"

We aren't happy because those societies are, or were not communist; they were still market societies, though their markets were deformed.


The insurance you are talking about is very interesting.
I think insurance would be a better solution in terms of health care. Better if people got insurance to cover themselfes (and family example) than for every taxpayer in the country to help them) It would provide insurance so that when people get sick, need a surgery or just a doctors appointment, the insurance company would pay it.

I coming to think that it is Norway that isn't a good example of "market society".

Take away the public system of controls and backups, and you will see how a market economy actually works. Hint: they do compete by lowering prices, but lowering prices always undermines quality of goods and services.


They don´t have to lower their service in terms of the contract you write, is they try to change anything or refuses to pay for your example surgury. Then you could sue them.

You can try to sue them. And you will lose, unless you again have a public defensorship that can give you good legal assistance for free or a reasonable fee. But I doubt very much a country that has dumped public medicine will retain a public defensorship.


When it comes to health insurance you would be dumb not to make someone look it over before signing. It´s not as easy as just a car insurance.
It would most likely be illegal for insurance companies to lower their costs so much that they can´t afford paying for enough people when its needed.
Of course its hard to say, suddenly many many people would become sick or need hospital without the company being prepared, but they would have to find a way to pay for it and later take the consequences. (loans etc)
So it would be smartest to get insurance covering as many diseases as possible, but it would not cost 5,000$ a month.
Insurance companies would explode, everybody needs it, so this would be very attractive at the market.

You are very naïve.


If someone were to be sick and had the risk of dying, I am sure there will be organizations helping unfortunate prople. Just like there is Red Cross, UN, doctors without borders too.

And who pays for the Red Cross, UN, or MSF?

Luís Henrique

[Guardia Rossa]

To think I was like our Norwegian friend 1 year ago.
I even voted on the Social-democrat worker's party.

Norseman, you need to read Value, Price and Profit, so as to understand what we are talking about.

Here it goes: https://www.marxists.org/archive/marx/works/download/pdf/value-price-profit.pdf

Very basic and little book, good for starters like you and me. Bough mine 2 weeks ago and arleady finished it.

I'll just warn you: Karl Marx is freaking awsome. Get used to it.

[NorwegianCommunist]

Sadly I don´t have the time to answer all of you. I have the same 24 hours a day as you, but I am not going to use them on discussing politics with you.
I currently study at a private college, work part time, and try to build up a business with a few friends.
(ooops, don´t kill me for having ambitions...)

I understand that you focus on labour time reqiured to produce a product or perform a service etc.
Work is important to you, i understand.

But if you take all that work ethics with you in a market-economic society, you could build up a good economy.
Why don´t you communists build up a company and make your own communist business?
Create something, expand, get workers to work for you and give them the money or goods they deserve for selling you their labour time.
If you don´t understand business, you actually think this would work.

Why don´t you just make the best out of the situation?
If you live in a capitalist country, make the best of it. Don´t whine about the politics there, don´t GIVE UP just because its not the society you want.
I m not saying to quit politics, but don´t let that get in the way of you following your dreams, making money or creating a business of some sort.

To me it just seems like you are people that complaining about ideologies and give up because its not the way you want it..
SURVIVAL OF THE FITTEST.
Adapt to the society you live in. Give it a try

I live in Norway and complain about the taxes, the politics and the government.
BUT I don´t give up. I don´t let that come in the way for me creating the business I have put in many mange hours in building up.
If you think "be the change you want to see in the world" and you actually dont want to work because then you would be used negatively by a capitalist, or you don´t want to buy this and that because it was made by workers that are underpaid etc, then guess what? You won´t make it.


I´ve read a lot on this page and seen how you hate on capitalists.
If it weren´t for them there would not be any products or services. No work places, no paychecks, no advancements in the society.
Things would not evolve if people weren´t paid for the risks their taking.
We would still live like we did in the 1500´s I think.

We all disagree with eachother here.
But if you don´t even try to what I told you, then you have already lost.
Do you understand? You have already lost by giving up.
You can follow your political beliefs, but when you are complaining and sitting on this forum all day, somebody out there is making money, giving a workplace for people, giving them a paycheck in exchange for work.
So good luck comrades. I won´t be visiting this page again. There is too much negativity here.

I´m sure you will quote me 50 times and say why i´m wrong, but remember you are sitting on your computer complaining all day, Im out there making money and building up a business because Im not ***** afraid to take risks.

[RedMaterialist]

Create something, expand, get workers to work for you and give them the money or goods they deserve for selling you their labour time.


You misunderstand a very basic principle of capitalist economics. Workers sell you their labor power (potential, ability to work.) This labor is a commodity like all other products in a capitalist economy and its price is determined by the costs of its production. It is usually paid per hour, say $10.00 per hour. The worker then begins to work and produces a value which is incorporated into a new commodity. He or she adds value to raw materials, to previously produced commodities. The wages paid are a completely different amount from the value added by the worker.

The value added by the worker, the added value, or as Marx termed it, the surplus value, is not paid to the worker. The capitalist takes the commodity, the value, at the end of the production process and sells it. The capitalist has paid nothing for the added value. However, he/she sells that value on the market. That is the capitalist's profit.

Workers are not paid what they deserve but what they are worth on the open market. They are commodities. They can be thrown away whenever needed, or starved, as in the picture above.

The system you advocate, for instance, health care insurance provided by the "free market", has already been tried for several centuries in Europe and most recently in the US. It was a complete failure, that is, except for the wealthy. Sometimes those with jobs would receive health insurance as part of their compensation. But as soon as those jobs were lost or the workers made a claim on the insurance, the insurance disappeared.

The system you have in Norway, health insurance provided by taxation and administered by the state, is the only method of providing health care for all of the people in Norway.

Take that away and Norway would have a revolution. A gentleman from the Finland Station would be arriving within a yr.

[RedMaterialist]

Maybe you should tell us what part of the private college costs are paid by the state. In the US a large part of the costs are paid by the defense industries, etc.

Your private college is almost certainly subsidized by public taxes.

[RedMaterialist]

Well, thanks, that's indeed very polite of yours.

But these people would disagree with your Panglossian views:

http://cdn1.yourstory.com/wp-content/uploads/2014/08/Abandoned.jpg

where is that from?

[Luís Henrique]

where is that from?

Bengal.

Luís Henrique