Economic comparison

[Stormin Norman]

In case you didn't read my whole critique take a look at the economic theory of both systems and compare which remains the better option. Sorry if you have already seen this. I am just getting a little fed up with people who claim that I do not know anything about communism, therefore I have no authority to speak on the subject. In fact, it has been a hobby of mine for some time. It is not my area of study, and I am not a political science major, but I think my logic speaks for itself. I am self educated when it comes to most of my political philosophy, as most of political science teachers would fall into the liberal category, and would never tell us the true nature of communism. Instead they wished to gloss over the subject and pretend, like many of you, that communism would save the world if only given a chance.

Economic comparison

If the holes in Marx’s philosophy seem unconvincing, let’s turn to the economic principles behind central planning. Even Frederick Engels and Carl Marx were amazed at the proficiency of the market. Marx stated that capitalist economies remained, “The first to show what man’s activity can bring about”, creating ,”wonders far surpassing Egyptian pyramids, Roman Aqueducts, and Gothic cathedrals”. So why then did Marx encourage it’s dismissal. The time period in which the Communist Manifesto was written marked the infancy of the free-market, brought about by the scientific and industrial revolutions. No market is perfect. They all have their problems. This along with the fact that social Darwinism was readily accepted by the robber barons, entrepreneurs and the majority of business people, mark the beginnings of the American communist movement, as the Progressive Party began to form. Labor unions, and social workers took to the forefront combating long hours, ‘unfair pay’, child labor and unsafe conditions. Thus, the beginnings of communism can be somewhat understood. To continue our analysis of communism requires a brief look at the market mechanism in contrast to central planning.
The job of any economy is to allocate scarce resources to the production of certain goods, and to distribute the goods among a given society. In the free-market this is best left to the market mechanism. Where marginal utility of the consumer is equal to the price being charged, and the marginal cost of production. Of course, this is the theoretical model of perfect competition, where there are many different markets with many competitors and customers, who have perfect information about the product, which is all the same. Furthermore, freedom of entry and exit from the market can not be barred. Obviously, not a very realistic world. It is more likely that some markets will be monopolized by large firms, while others resemble that of the perfectly competitive model. Economies of scale sometimes permit this to occur. Still the question remains can any one market be completely monopolized. Surprisingly, not unless it is done by government decree. Any monopoly has the threat of being bought out by larger firms through hostile takeover. Moreover, monopolies don’t get to arbitrarily choose their prices and gouge the customer. If prices are too high the customer will not purchase the commodity desired, leaving the companies bottom line suffering. Markets do not have the capacity to oppress their customers effectively, since they are dependent on their customers to survive. It is better to let economies run on Adam Smith’s invisible hand of supply and demand, because when everyone suites their best interest, an economy’s resources are allocated by price.
In contrast, central planners must decide which outputs to produce, which inputs to use, and how to distribute them without the convenience of an efficient price system. It is easy to see how markets are dependent upon one another. Economies can be stopped dead as a matter of short-sightedness. One industry’s output change can drastically effect other related industries. Input-output equations are often used to solve such problems. The lengthiness and complexity of these problems show the challenge of an economy that is completely controlled by the central government. It is impossible to predict how much of each output is needed and where they will be needed. A process to organize the various information needed to run an economy of interdependent markets is best left to a price mechanism in a free-market economy.
Furthermore, entrepreneurs are motivated by profit. In a market that equalizes income their motivation is taken away. Should it be expected that men will continue to devote their lives to inventing new products and processes of manufacturing when their reason is destroyed. The economic rent paid for such advances insures future innovation. Central planning will insure a stagnation of ideas as the free-thinkers, who generate useful market tools, vanish. Likewise, is the employees ability to work efficiently when he fears the state. People’s likelihood of decision making is directly proportional to the freedom to do so. To illustrate, it was common in the U.S.S.R. that businesses would stand still until state agencies could investigate. Only to find that the shipment wasn’t delivered because the producers were unsure what color the product was to be painted. The operator of the industry was hesitant to make decisions, because he did not answer to himself, but to the state. Looking at the differences in the market mechanism and central planning, it is clear why the communist economic plan is failing around the world.


(Edited by Stormin Norman at 9:12 pm on June 27, 2002)

[Hayduke]

Let me begin,

First I did like to say that there has been now real communist country. All these countires that were so called communist, were
sick men that got captured by the power of their position.

And the only real communist state is fighting to keep standing.
Cause off the horrible ecnomic embargo that is placed on it.

You have made many work of this topic, but ill give you my opnion.

In a capitalist system it is all about concurrention. Many people say that the concurrention is productive. The truth is different. The first American economic downfall was caused by the big concurrention between companies wich lead to the end of their buisness.
They invested to much to keep ahead of each other.
This meant their downfall.

Have you ever looked at the results of the five year plan. If not you might want to, cause these productions were amazing and that was many years ago, imagine how it would turn out today ?

First I did like your reply on this before I come with more points,

Bas

[jimr]

The only way that the highly privatised Capitalist state can stay afloat is through bail outs by the central government. Look at whats happening with worldcom. People need to keep attaining stupidly good production levels and when they fall below it they have to fake it in order to stop the market from crashing.

Capitalism is a fraud, atleast in its supposed lassiez faire attitude. It requires the government to give its larger businesses advatages to keep them going to set the trend for the others. Its disgusting.

[marxistdisciple]

Capitalism works because of it's overproduction. It produces more than people need, thus ever looking for more ways to sell products to people....(as if to prove my point and advert window popped up while i was writing that first sentence!)

The problem as I keep stating is, however much you make people feel like they need things which they really don't need...there is only so much you can sell them. After my third new cellphone I have conclusively realised that I really don't need to keep buying a new one. this has not put off many people, who continue to buy new cellphones as soon as their cellphone becomes unfashionable. The latest "phones4u" ad campaign is based around the phrase "is your mobile embarassing?" and features many ways people try to hide their cellphone from the eyes of "superior" cellphone owners. This seems blatently absurd to me, but still people buy new phones which get smaller and smaller, with virtually the same features. In fact fashion is a market commodity created by capitalism.

How do you keep people interested in buying new clothes before their old clothes have worn out? Well you bring out new fashions seasonally, and peer pressure will do the rest (for the biggest market, aka teenagers.) It all makes sense to us, and we put up with it, but in effect it isn't really necessary.
There is nothing wrong with selling clothes, or liking fashions....the problem occurs is when people are pressured into buying brands they can't afford....nike, tommy, gap are all examples.

None of these ideals actually make reasonable sense, people in developing countries can't afford food, or one new set of clothes, let alone one new set each season.
To it's aid, the capitalist economy and free market must invent new and more interesting ways of selling products. I can only eat so much tinned soup, so they must increase their market share of tinned soup in order to make greater profits. All of this distracts from the actual goal of society, which is technological advance, and better living conditions. If these things are not achieved then the rest of the race is a waste of time. Unfortunately, although capitalism does create better conditions for the few, by it's nature someone must be exploited, to achieve ever cheaper prices or ever greater profits. My question is, when the market must always grow to survive, what happens when it can grow longer? What happens when every space is filled with advertising, every billboard used, and still no one more to buy products? The economy cannot grow for ever, it is impossible. So one day there must be another recession, and another recovery, and this goes on. It makes absolutely no sense to human existance though....in it's nature it misses the target of better living conditions....isn't that what we all want?

[Capitalist Imperial]

Quote: from jimr on 4:57 pm on June 27, 2002
The only way that the highly privatised Capitalist state can stay afloat is through bail outs by the central government. Look at whats happening with worldcom. People need to keep attaining stupidly good production levels and when they fall below it they have to fake it in order to stop the market from crashing.

Capitalism is a fraud, atleast in its supposed lassiez faire attitude. It requires the government to give its larger businesses advatages to keep them going to set the trend for the others. Its disgusting.


Such BS, generalization, and a purely dogmatic claim. Worldcom and even enron do not represent most of american capitalism, which sustains itself quite well without government subsidation. It is in fact the US government that relies on capitalism for economic viability. Do you even understand our economic system?

[IzmSchism]

Frauds are institutionalised because the expansion of capitalism has not been accompanied by moral constraints that require consideration of the social consequences of the get-rich quick schemes that dominate corporate life.

As always, ordinary people picked up the real cost through lost savings, investment, pensions, jobs and homes.

The get rich quick days are slowly rolling over to reality. What we thought were booming days of a rolling economy back in the 90's was nothing but smoke and mirrors. I believe it is inevitible that we are going to hit a recession. I also believe that there will be more scandals to rock the US economy as well in countries abroad. As for Enron and WorldCom not representing most of amerikan capitalism check your head! WorldCom alone runs 1/3 of the worlds internet, they own over 60 companies which they rolled over in just under 15 years, it was at last that the juggernaut was stopped by the fed'w when they wanted to buy Sprint. Enron is huge...period. The only crime today is wether or not you get caught. The culture of the entrpreurnal has become suh a race that it has turned the rules of the game into an empty race where there are no boundaries and no morals.

[marxistdisciple]

"It is in fact the US government that relies on capitalism for economic viability"

Indeed. Their political will is enslaved by market considerations.

I think jimr might have it slightly the wrong way round....now the corporations make the government rely on them. Therefore, they have huge political influence on the government. With me so far? As they often fund political candidate's election campaigns, the candidates have a tendancy to grant corporations things they wouldn't normally (if they hadn't sold out) hence the Bush and Enron connection.

Anyone who thinks politics and corporations are seperate entities is mistaken.

Let me make another presumtive gesture, and indicate that if the people of the country are not directly in charge of policy decisions, based on their elected congressperson's promises/beliefs then this is an erosion of democracy. If the senator/president/political representative is overtly pressured by monitary gain, then he or she is unlikely to make entirely rational decisions. Of course there will always be bias in some way or another, for any person, but if a person is given large sums of money, this is often called "bribary." If a sports person is given large sums of money, this is questioned, especially if it is shown that they changed results of games knowingly. However, in politics most parties rely on private funding to run campaigns, and indeed keep the party going. Doesn't this by any reasonable logic make them bias in some way? If a company has the resources, they can make a large donation to the party in power, thus incresing their chances of favourable policies/economic conditions. What is democratic about that??

[IzmSchism]

and the CIA helped to fund the Democratic Party for years.

[Moskitto]

Yeah, And then you get loads of shit with prices set by supply and demand like passport photos costing 3 times as much as 1/16 sized photos or full sized photos. I mean, what's the deal with that.

[Reuben]

capitalism has failed. The main theorist behind it Adam Smith, argued that the market would provide. I will not go into this a it s failure does not merit discussion.

After 200 years of capitalism developing and spreading its tentacles 24000 starve everyday.

Compaare cuba and chille. Even though chile has traditionally been more industialized and has notn been blockaded cuyba still a significantly higher life expectancy plus other stats than its capitlaist counter part.

[IzmSchism]

chilie got pimped by the USA, then they threw in pinochet the butcherer, I would say that eventhough they are in there own problems, they too have not been given a fair shot at a capitalist system, just as Cuba is struggling with communism. although I do agree with you for the most part.

[Capitalist Imperial]

Quote: from Reuben on 10:34 pm on June 27, 2002
capitalism has failed. The main theorist behind it Adam Smith, argued that the market would provide. I will not go into this a it s failure does not merit discussion.

After 200 years of capitalism developing and spreading its tentacles 24000 starve everyday.

Compaare cuba and chille. Even though chile has traditionally been more industialized and has notn been blockaded cuyba still a significantly higher life expectancy plus other stats than its capitlaist counter part.


Thosands, even millions, starved every day before capitalism.ever existed.

The worlds most sucsessful, advanced, industrious, powerful country ever in world history got there due to capitalism..

The vast majority of 1st world nations are capitalist.

The worlds emerging markets are capitalist.

Capitalism (cheifly the USA) has yielded the vast majority of revolutionary invention and innvation that has benefitted the world in the last 150 years, providing for the advancement of mankind overall.

Capitalism encourages personal responsibilty, and provides for unprecedented freedom..


But other than those small thing I guess it has failed.

[Reuben]

Marx acknowledged the extent of progress that capitalism would bring, however America is by know means a reasonable example, simply because its wealth is so contingent on its relationship ewith Latin America and other parts the world. t that over 70 per cent of Americans work in the tertiary industry ( a figure which is exists across first world capitalist countries) simply because thy are able to get there resources very cheaply from elsewhere. THis means the great mass of Americans can be employed simply providing services for other Americans. It is little suprise that Americans enjoy a good lifestyle


FUrthermore it is the reliance of the American lifestyle on the third world which has led thejm to intervened so violently and undemocratically on behalf of the United fruit company. The worst example of America intervening to defend its interests, which ARE completely contingent on foreign labour and markets, is the way it protected Suharto so that they were able to purchase fro mhim cheap illegally cut wood.

Regarding your claim that capitallismprovides unlimited freedom, PLEASE EXPLAIN how the property 'freedoms' associated with capitalism apply to a sweatshop whos existence nad poverty are necessary the capitalist system.

If capitalism has made great technological advances =then it has done very badly to harness the bennefits of these technologies. For example, only 20 per cent of all people have access to a telephone

[Guest]

Let's compare capitalist nations in Africa to socialist Cuba. Where do people starve, not have access to free medical care, education and housing? Cuba or Ethiopia?
"Let us be judged by how we treat the least amongst us" is a famous quote that highlights the success of socialism. Even in the small states such as Cuba, socialism has provided for its people, whereas in capitalist small and underdeveloped nations such as those in Africa are home to starvation, poverty, filth and disease.

[Hayduke]

The problem with Capitalism is basically this:

Everyone lifes for his self and you are on your own.
Capitalism is becoming more a money system then a people system. We all stress ourselfes to death for a few pieces of paper called money to buy the basic things like food. A communist state is there for the people. And for a change " all the people ".
I live in a system based on greed, and im disgust with it.

[Stormin Norman]

Jimr,

I don't think Worldcom is getting a bailout. The government is about to start handing down indictments and the company faces bankruptcy. The CFO has been fired and the prosecution is stating to pit the board members against themselves. The new chairman of the SEC is an upstanding citizen who walked into an undesirable position. The economic fallout that we are seeing now is a direct result of Clintonian policy. Clinton appointees did not pursue these issues for fear of hurting what was generally consider to be a good time had by all. Everyone was profiting, therefore the consensus was 'if it ain't broke don't fix it'. It is obvious that the government has neglected it duties within the market place while pursuing other less important issues, such as Microsoft.
I would agree with you that there is too much corporate welfare. Take a look at the airline bailouts that occurred as a result of Sept. 11th. The government had no business giving those corporations, who had been practicing bad customer service to begin with, taxpayer dollars. What we say was a supply shifter, although horrendous one. The demand for flights decreased as a result of terror, therefore the market should have compensated by shifting its supply inward. This would have been an excellent time for the poor operators to be expelled from the business. Unfortunately, grandstanding congressman compromised the honesty of the market.

(Edited by Stormin Norman at 11:07 pm on June 28, 2002)

[Stormin Norman]

In response to:

'capitalism has failed. The main theorist behind it Adam Smith, argued that the market would provide. I will not go into this a it s failure does not merit discussion.

After 200 years of capitalism developing and spreading its tentacles 24000 starve everyday. '

A statement that has a striking similarity to something Marx himself once said, that being, “The charges of communism made from a religious, a philosophical and generally, from a ideological standpoint are not deserving a serious examination.” It must be communist ideology to make grandiose declarations without having the duty of backing them up. Marx too believed that man's perceptions were subject to change. If something is said and believed by enough people it must automatically be true. Well, I expect more. If you want to make remarks you should be held accountable for what they stand for. So come on and dazzle me with your brilliance. Let us all hear your synthesis of Adam Smith's philosophy along with a competent criticism. Stop with the intellectual guerrilla tactics. Enough with the hit and run.
I would also challenge you to look at the governments of the 24000 people who are starving. Hardly any of them die in the borders of the United States. No matter how you criticize my country for causing the deaths of all those starving in the world, we do a damn good job feeding our poor. Whether this is done through food banks or welfare (which I disagree with), the fact remains that everybody here does get a chance to eat.

[Stormin Norman]

No real communist countries, a charge that I hear repeated on this post many times. Here is a list of the ten recommendations, which Marx said were necessary for communism. Take a close look at them and tell me which ones where not present in any of the communist governments that you claim were faulty. Where did they go wrong then?

1.) Abolition of property in land and application of all rents of land to public purposes.
2.) A heavily progressive or graduated income tax.
3.) Abolition of all right to inheritance.
4.) Confiscation of property from all emigrants and rebels.
5.) Centralization of credit in banks of the state, by means of a national bank with state capital and an exclusive monopoly.
6.) Centralization of the means of communication and transport in the hands of the state.
7.) Extension of factories and instruments of production owned by the state, the bringing into cultivation of waste lands, and the improvement of soil generally in accordance with a common plan.
8.) Equal obligation for all to work. Establishment of industrial armies, especially for agriculture.
9.) Combination of agriculture with manufacturing industries, gradual abolition of all distinction between town and country by a more equable distribution of the populace over the country.
10.) Free education for all children in public schools. Abolition of children’s factory labor in its present form. Combination of education with industrial production, ect...

I would say the only one that never surfaced was the distribution of the populace over the entire nation, the removal of the distinction between town and country. Do you propose that is what broke the communist ideal from reaching its fullest potential? Of course not, because that would be ridiculous. The problem lies in the idea of such things as confiscation and abolition of private property, and the essential means required to achieve that end.


(Edited by Stormin Norman at 11:46 pm on June 28, 2002)

[Stormin Norman]

Marxistdisciple,

Overproduction is the flaw within capitalism that results from technological advances and increased productivity, the result of that being war. Blah blah blah.... Can't you be more original than that? This is a charge that has been tossed about for years. Any student of economics can tell you that simply is not true. Since markets operate on supply and demand, overproduction would cause the businesses involved to tank if they if the continued to overproduce. The calculus to avoid such folly does exist within the business cycle, and it is called the law of diminishing returns. For every unit that a company makes there exists a price that the consumer is willing to pay. If a company makes too much of one product they must lower their prices to liquidate supplies. This is fine if the company can also increase its productivity, but there is always a balance that must be considered. A business wants to produce as long as profits are increasing, but if you flood the market with product you can no longer yield a high price.
You see the beauty of the market mechanism remains its ability to suit its own needs and produce only what is necessary to maximize profits. What do you suggest that we put some wizard of a bureaucrat in charge and let him predict what resources need to be allocated where, and how many units of an item the public will need? Of course not, we would all starve and be subject to long lines in order to obtain a simple loaf of bread.
The last person I want in charge of the business sector is some politician. The reason many politicians go into politics is because they can't make a profit in the market, and it is more profitable for them to exploit the ignorance of the public.

[Stormin Norman]

Response to Ism Chism who stated:

'Frauds are institutionalized because the expansion of capitalism has not been accompanied by moral constraints that require consideration of the social consequences of the get-rich quick schemes that dominate corporate life.'

You are right the economic theory of free enterprise does not account for people's morality. It is a mechanism, which describes the best way to allocate resources. After all that is the job of any economy. It just so happens that the best system in place is the one that fails to consider man's disparities, as it is the best suited for a free democratic state.
I think the problem that you are noting is the result of a failure of government to serve it proper functions. It is the government’s job to account for these undesirable elements that would do harm to his fellow man. They are the ones responsible for upholding the laws and protecting the citizens. Ask yourself, has the government gotten better or worse at fulfilling its responsibility, with increased socialism within the U.S.? Many of the problems are due to the tick that is now afflicting the market, sucking its life blood. It is no coincidence that increased government involvement in the business cycle produces such symptoms. Ask yourself, will your views help the man get elected who claims to care for the masses, yet hurts them by holding the free market hostage with the governments monopoly on power? Who would you rather elect, the man who believes the government purpose is to protect the people from damage, or the man who uses this as a way to serve his own interest? What kind of man do you want to elect the classic liberal or the social liberal?

[Reuben]

The poted from Smith ot simpyl an odd commment he made which was proven . This point wa CENTRAL to the justification of the capitalist economics.

Regarding the efeect that America has had on the impoverished masses, America has used military strength to keep people in poverty against the initiatives of democratically elected governments. If you want an example i can give you one...

[Capitalist Imperial]

Quote: from Guest on 8:31 am on June 28, 2002
Let's compare capitalist nations in Africa to socialist Cuba. Where do people starve, not have access to free medical care, education and housing? Cuba or Ethiopia?
"Let us be judged by how we treat the least amongst us" is a famous quote that highlights the success of socialism. Even in the small states such as Cuba, socialism has provided for its people, whereas in capitalist small and underdeveloped nations such as those in Africa are home to starvation, poverty, filth and disease.


What capitalist nations of africa? Those countries are merely war-torn regions existing under warlord regimes, hardly capitalism is practice. And the people of cuba are not that well off, hundreds flee for the US daily, and cuban citizens can't even go into certain shops, resorts, or beaches, as those are reseved for capitalist europeans and canadians. True equality, a real paradise, alright.

[Capitalist Imperial]

Here is a true exposure of Cuba's supposed "great healthcare system"...

www.123cuba.com/Cubamed.html

[Reuben]

i havent clicked on your stupid link, though would be interested to know what it is about the healthcare system the accounts for a 75 year life expectancy

[Lardlad95]

the thing is, who is capitalism sucessful for? It sure as hell aint the people.

because there is money, does not mean that it works.

WHat it means is that people who have the power will continue controlling the power. The people never had a chance.

Manipulation and greed, its in unending cycle. And the only reason people think capitalism is so great is because they see how powerful the rich are, yet those CEO's never seem to mention the fact that regular workers will never reach the level that they are at.

Unless everyone has the same chances the system isn't working

[Stormin Norman]

Lardlad,

Tripe. Is that all you are capable of?

Rueben,

Sorry, I could not understand a word you said. Don't talk with your mouth full.

[Capitalist Imperial]

Quote: from Reuben on 6:46 pm on June 28, 2002
i havent clicked on your stupid link, though would be interested to know what it is about the healthcare system the accounts for a 75 year life expectancy


The link you refuse to acknowledge spells out how that statistic is manipulated by cuban doctors. OOf courese, you don't want to read the truth, it would be counterproductive to your commie propoganda

[Capitalist Imperial]

Quote: from Lardlad95 on 6:55 pm on June 28, 2002
the thing is, who is capitalism sucessful for? It sure as hell aint the people.

because there is money, does not mean that it works.

WHat it means is that people who have the power will continue controlling the power. The people never had a chance.

Manipulation and greed, its in unending cycle. And the only reason people think capitalism is so great is because they see how powerful the rich are, yet those CEO's never seem to mention the fact that regular workers will never reach the level that they are at.

Unless everyone has the same chances the system isn't working


You obviously don't know of what you speak.

Everyone in the US has the right to start their own business!! Workers choose to work, there are millions of millionaires in the US that earned it from almost nothing! What you describe is communism, where workers never have a chance to become owners of property or production. What are you talking about???

[Reuben]

First of JNorman my name is spelt REUBEN not RUEBEN.

I dont quite know what CI is saying when he saying when he says that Cuban doctors are manipulating statistics on life expectancy. Yes, they are manipulating the figure for expectancy, but this is through curing illnesses, hardly an illigitimate manipulation of stats.

REUben

[Capitalist Imperial]

Quote: from Reuben on 9:09 pm on June 28, 2002
First of JNorman my name is spelt REUBEN not RUEBEN.

I dont quite know what CI is saying when he saying when he says that Cuban doctors are manipulating statistics on life expectancy. Yes, they are manipulating the figure for expectancy, but this is through curing illnesses, hardly an illigitimate manipulation of stats.

REUben

Just read the link, unless you scared.

Check world life expectancy stats, Cuba,s is at 68.5, below US standards.