Rational Self Interest

[Apoi_Viitor]

I have some questions for those of you who are moderately well-adversed in capitalist economics. First off, what is the empirical evidence for declaring that man fundamentally acts in his own self-interest? Secondly, why can man only act rationally under a free market system? Why does the introduction of government regulation obscure his ability to act rationally? If he acts in rational self-interest, why isn't he able to take into account the influence of the government on his financial decisions? Similarly, why is he able to understand capitalisms effect on his financial decisions? And finally, if man can fundamentally understand the capitalist system, enough to make rational investments, why can't the government understand it enough to influence its economic policies? Likewise, if man isn't able to understand capitalism's effects on his financial prospects, then why is it that capitalist proponents allege that man is only able to act in his own rational self-interest under a free market system?

[Widerstand]

There is little to no evidence that "homo economicus" is a correct model for human behavior, the most painstakingly obvious being the factual impossibility for all humans to make rational economic decisions all of the time because most humans simply don't know enough about economy to do so, let alone reflect their choices every time they make a decision. There's a lot of criticism of h.e., even from capitalist economists, and as far as I'm aware h.e. isn't really used in models anymore (though it may be used to justify Free Market blabber, idk).
I think the assumption itself is usually based on a mix of enlightenment "humans are rational!" blabber mixed with Social Darwinism (which was contested for example by Kroptkin's Mutual Aid). There are plenty, read: almost all of traditional Game Theory, models that can be used to somehow show that a Free Market would be the best system, if indeed h.e. were factually correct.

[Havet]

First off, what is the empirical evidence for declaring that man fundamentally acts in his own self-interest?

None/very few

[Palingenisis]

which was contested for example by Kroptkin's Mutual Aid[/B]). There are plenty, read: almost all of traditional Game Theory, models that can be used to somehow show that a Free Market would be the best system, if indeed h.e. were factually correct.

Kropotkin was of course also a leading biologist of his day.

That is a brillant book however dated.

http://www.gutenberg.org/cache/epub/4341/pg4341.html

[Revolution starts with U]

Here's the thing, to anyone looking at it rationally, they don't. Rational man is a paradox, or at least contradictory.
But these free marketeers who still hold to this value do so because they have defined certain terms in certain ways;
1) By rational they mean made a decision with a certain goal in mind. They like to act as if this seperates us from animals... but I fail to see how. If that's the definition of rationality, than every living thing is rational.
I always thought reason involved logic, imagination, and studiousness.. but hey, what do I know. I guess it's just doing shit. It was quite rational for that friend of yours to take their own life
2)By capitalism they mean a totally free market which has yet to exist. THe last 300 years of western economics is not capitalism, it's socialism . Capitalism existed for maybe 10 years following the american revolution, and probably would have made a glorious empire under the Confederacy if northern aggression hadn't stopped them .
So of course, you see all kinds of arguments saying "in a free market blah blah blah."
3) By libertarian they mean the only authority they are against are the ones who question their authority. Freedom means my ability to make decisions regarding your life, but you staying the fuck out of mine.

Idk, how can argue against ones so willing to fool themselves?

[Lt. Ferret]

libertarians dont believe in authority. you dont have to work for them or with them, you can wander away and do your own thing. if you dont like your libertarian boss, then quit. your socialist boss is more likely to kill you or imprison your family.

[Amphictyonis]

Ayn Rand is dead. God save the queen! As a previous poster pointed out Kropotkins Mutual Aid was a good response to Darwin and Adam Smiths bunkum about humans acting only in self interest (I think Darwin's work was actually warped to fit this view). Smith thought self interest to be the number one motivation behind all human action and inferred only a capitalist system could fit "human nature". Ayn Rand took it to the next level. She was, in my opinion, a social Darwinist. She gained much of her views from Nietzsche as well. Nietzsche and Max Striner.

I don't deny self interest is and should be a motivator behind human action but to deny altruism exists is absurd. Also, societies set up with competition as the foundation are going to breed isolation, distrust and down right vile behavior as we see under capitalism. It can be argued self interest could be a motivator behind cooperation as it would be in our interest to cooperate in lieu of compete for resources. The thing is, only through competition can hierarchical society be held together- with cooperation things would tend to me more equal and people such as Ayn Rand aren't supporters of equality, they think so called 'superior' humans should hold power over the 'weak'. This is the capitalist mind frame. Thomas Malthus was also one of the bastards responsible for setting the foundations of this elitist bourgeois mind frame.

[Lt. Ferret]

altruism is helping someone else with no gain to you. almost all social interactions provide some gain.

[Revolution starts with U]

^ redefining terms to suit your argument. That's what I'm talkin about.
Almost any person, on any normal part of the day would define altruism as helping someone little to no material gain. In other words, whatever gains made, even if material, tho mostly spiritual/immaterial, are outweighed by the losses one took.
Helping the old lady next door bears great physical cost to one's self, but one feels better about themselves; altruism.
Define it under your terms, Lt., and it doesn't exist... but then... from whence did the word come?

Here's the rub. It is in the self-interest of the majority of people to place decisions under democratic power.

[trivas7]

Here is a link re Randian rational self-interest. Don't get caught up in the labels; you're asking for an explanation of nonsense.

Here's the rub. It is in the self-interest of the majority of people to place decisions under democratic power.

So we are all self-interested.

[RGacky3]

altruism is helping someone else with no gain to you. almost all social interactions provide some gain.

Thats not what altruism is, its helping someone with a selfless motivation, such as a guy hiring someone to do work that they don't really need to hire someone to do so as to give the guy a step up, most people would consider that altruistic.

libertarians dont believe in authority. you dont have to work for them or with them, you can wander away and do your own thing. if you dont like your libertarian boss, then quit. your socialist boss is more likely to kill you or imprison your family.

They absolutely believe in authority in practice, they just call it something else. THey'd have no problem with a Pullman style private dicatorship, but they just call it someting else.

As for your last sentance ... a bunch of shit, strawman.

[Revolution starts with U]

Here is a link re Randian rational self-interest. Don't get caught up in the labels; you're asking for an explanation of nonsense.


So we are all self-interested.

No, I'm saying the same thing as you; it's nonsense. We're guided by both self-interest and altruism... shit many times altruism is done in self-interest (Extreme Home Makeover for example). But many times it's not (taking a bullet for someone).

It's all "human nature" irrational nonsense.

[Svoboda]

First off, what is the empirical evidence for declaring that man fundamentally acts in his own self-interest

For your first question of man acting in their own self interest, I can't think of any exact scientific evidence attesting to it(as I doubt you have evidence disproving it). But Aristotelian ethics show that man tries to ultimately pursue some sort of good, and all actions are attempted in order to achieve this sort of good. The purpose of pursuing the good, is of achieving happiness, for is not everything driven by a want of happiness? Therefore even a staunch communist is pursuing their self interest of creating a more just society due to them being unhappy with the current structure of society which they believe is oppressive and exploitative, and they believe the end achievement of communism would ultimately be the good and would therefore bring them happiness. Therefore all actions are pursued by self interest based on such reasoning(the reasoning isn't fully Aristotelian but the basis of it is).

Secondly, why can man only act rationally under a free market system? Why does the introduction of government regulation obscure his ability to act rationally? If he acts in rational self-interest, why isn't he able to take into account the influence of the government on his financial decisions?

In a market society a consumer has a choice, and they sway the market into meeting their demands and ensuring products of high quality and low price(or whichever the consumer prefers). If a new product enters the market itsreplaces the inefficiency of an old one, i.e. the car replacing the horse the consumer will jump on it and help to eliminate the growing uselessness of the old product. In the example provided the initial cost of the car was extremely high, but due to high demand the production of it would increase from people seeking profits, this would increase competition and lead to price decreasing and quality increasing.

While government regulation often tends to be highly counterproductive, for how is the government supposed to know how to run a business? It acts as an expert on all issues and often only helps certain big business interests and certain pressing consumer groups. So in example if a company is engaging in some sort of environmental degradation the government often creates random regulations which actually dosen't do anything and often are counterproductive. While in a market system, through the rationality of the consumers, they could organize a boycott against the product the product and go to competitor products. While other forms of regulation and interference into the market economy like Obama's recent health care bill(and national health care too) or investment into R&D and subsides(specifically agricultural) only end up helping big business.

In the case of health care government control or regulation of health care aims to give high quality health care at an affordable price essentially to everyone. But in reality they only miss the overall problem of the lack of competition in the health care industry which drives up costs to enormous levels, and drains government coffers and basic people's pockets. While direct government funding of R&D only seems to be helping the big business interests, as instead of worrying about them having to spend large amounts of money in order to order to stay competitive they can rely on the government. While agricultural subsides encourage careless unproductivity and create artificially low prices and which make farmers in undeveloped nations unable to compete. Also don't forget about straight out government bailouts(which of course are only given to those "too big to fail"), if you fail don't worry the government will be right there to save you, this essentially encourages irresponsibility.

And finally, if man can fundamentally understand the capitalist system, enough to make rational investments, why can't the government understand it enough to influence its economic policies? Likewise, if man isn't able to understand capitalism's effects on his financial prospects, then why is it that capitalist proponents allege that man is only able to act in his own rational self-interest under a free market system?

The government is not a rational interest, it is a monopolistic force which seeks to serve its own interests. And I assume man can't fully understand the free market's effect on his financial prospects, but then again what can we fully understand? Trial and error for me is the basis of individualism, in a simplistic manner if I take cocaine and I find it gives me a negative reaction I won't take it again, or if I do continue taking it out of the case of addiction then I should individually seek action under my own accord understanding that my life is going in the wrong direction. The government dosen't need to tell us what's right and wrong, we can figure that out ourselves.

[Svoboda]

I was meaning to open a thread on this, but it seems to apply in this discussion. Is communism, or overall state control of economic forces really economically viable? I really want to want to see what the justification is and would like to legitimate proof.

[RGacky3]

as I doubt you have evidence disproving it

Actually there have been studies, and they show that "human nature" is not a static thing and is not predominantly selfish, and leans toward being more social. If you honestly don't believe me I'll look it up for you.

Therefore all actions are pursued by self interest based on such reasoning(the reasoning isn't fully Aristotelian but the basis of it is).

Thats getting into philosophy, i.e. trying to define reality, not science, i.e. figuring out what the reality IS.

In a market society a consumer has a choice, and they sway the market into meeting their demands and ensuring products of high quality and low price(or whichever the consumer prefers).

Right from the bat your wrong, there is no Consumer class, there is no choice in a market, the choices are dependant on your disposable income. Its money that controls the market, meaning those with more control more, those with just enough to survive don't have any sway on the market nor do they have any control.

THats why low income housing needs to be subsidised, as does food for hte poor, because the market won't take care of it, because it only cares about those with money.

If a new product enters the market itsreplaces the inefficiency of an old one, i.e. the car replacing the horse the consumer will jump on it and help to eliminate the growing uselessness of the old product. In the example provided the initial cost of the car was extremely high, but due to high demand the production of it would increase from people seeking profits, this would increase competition and lead to price decreasing and quality increasing.

ONLY if that new product benefits the ruling class, if it benefits monied interests, thats why new weapons are being built all the time, thats why we have a new iphone all the time, but cheap medicine for curable deseases takes forever.

Again, your missing the elephant in the room, i.e. monied interests.

While government regulation often tends to be highly counterproductive, for how is the government supposed to know how to run a business? It acts as an expert on all issues and often only helps certain big business interests and certain pressing consumer groups.

THe difference is while big buisiness is ONLY responsible to the people that run the buisiness and own it, the government is responsible to the public, thast the difference.

THe government will run a buisiness paratially for hte benefit of society, a buisiness will run it ONLY for profit, if you want to know the difference look at different healthcare systems.

While in a market system, through the rationality of the consumers, they could organize a boycott against the product the product and go to competitor products.

Or the company could just lie about it, because there are no laws preventing it, so no problem, also most likely competitors are also doing the same, because they'd save more money if they both agree to do it, also most likely people are not financially powerful enough to have an effective boycott.

That pipedream of how markets work is cartoonish and has nothing to do with reality.

In the case of health care government control or regulation of health care aims to give high quality health care at an affordable price essentially to everyone. But in reality they only miss the overall problem of the lack of competition in the health care industry which drives up costs to enormous levels, and drains government coffers and basic people's pockets. While direct government funding of R&D only seems to be helping the big business interests, as instead of worrying about them having to spend large amounts of money in order to order to stay competitive they can rely on the government. While agricultural subsides encourage careless unproductivity and create artificially low prices and which make farmers in undeveloped nations unable to compete. Also don't forget about straight out government bailouts(which of course are only given to those "too big to fail"), if you fail don't worry the government will be right there to save you, this essentially encourages irresponsibility.

As far as healthcare, if they had a PUBLIC option, then things would have been different, cost would have been driven down, don't believe me? Look at the rest of the world.

As for your other examples I agree, but thats not governments fault, thats because the Capitalist class has become SO powerful that they now hae a strangle hold an the government. In other countries where the Capitalist class did'nt develop so powerful, the government actually functions as a democracy.

This is not a question of more government or less, its government for who? For Us or for the corporations? Power for who, for big buisiness or for the people?

Your libertarian ideologies are ones that are adored by big buisiness, because it gives them an excuse to cut every resembelance of public control of the economy possible, and give it all to themselves, people like you are the darlings of big buisiness, (its not about government, btw, its about a hatred of democracy, as is seen by their hatred of unions.)

[Revolution starts with U]

As for your other examples I agree, but thats not governments fault, thats because the Capitalist class has become SO powerful that they now hae a strangle hold an the government.

As long as a monied class exists with general political power above the common people their class always will strangle the government.

In other countries where the Capitalist class did'nt develop so powerful, the government actually functions as a democracy.

you may want to put that as "democracy." Switzerland is cool and all, but it's certainly no worker's paradise. And it still benefits from capitalist exploitation of 3rd world countries and rent seeking.

[ExUnoDisceOmnes]

Billions across the globe... the great majority are suffering from unequal distribution of the wealth. Whenever I see the self interest argument, even if I dont agree with it, I ask what is in the best interests of the worlds vast majority.

[RGacky3]

As long as a monied class exists with general political power above the common people their class always will strangle the government.

Not really, there are countries where the economic powers that be are not powerfully enough to totally destroy the democratic power, some countries have more democracy some have less, and generally it has to do with the economic power dynamic.

you may want to put that as "democracy." Switzerland is cool and all, but it's certainly no worker's paradise. And it still benefits from capitalist exploitation of 3rd world countries and rent seeking.

I understand that, and I'm not trying to deminish capitalism in the more democratic countries, nor the fact that global capitalism is a whole other dynamic. However, some countries have much more democracy than a country like the United States.

[Revolution starts with U]

I was meaning to open a thread on this, but it seems to apply in this discussion. Is communism, or overall state control of economic forces really economically viable? I really want to want to see what the justification is and would like to legitimate proof.

You should take what people tell you with a grain of salt. Verify claims for yourself. Are you sure this is the definition of communism?

For your first question of man acting in their own self interest, I can't think of any exact scientific evidence attesting to it(as I doubt you have evidence disproving it).

And that's why it's pointless semantics. It is clearly redefinition of terms. If I have described RSI theorists definition of said terms incorrectly in my previous post, please let me know.

But Aristotelian ethics show that man tries to ultimately pursue some sort of good, and all actions are attempted in order to achieve this sort of good.

Semantics. ALso, as Gacky said, philosophy, not science. We're dealing with "truth" here. What we want to deal with is "fact."

The purpose of pursuing the good, is of achieving happiness, for is not everything driven by a want of happiness?

Semantics. Idk... maybe. Not always. At the very least, not always directly.

Therefore even a staunch communist is pursuing their self interest of creating a more just society due to them being unhappy with the current structure of society which they believe is oppressive and exploitative, and they believe the end achievement of communism would ultimately be the good and would therefore bring them happiness.

Pretty much

Therefore all actions are pursued by self interest based on such reasoning(the reasoning isn't fully Aristotelian but the basis of it is).

Once again, taking a bullet for someone can only semantically be described as self-interest, and not at all if the person we're talking about doesn't believe in the after life.

In a market society a consumer has a choice

,
Yes. Much like the american voter has a choice in the presidency

While government regulation often tends to be highly counterproductive, for how is the government supposed to know how to run a business? It acts as an expert on all issues and often only helps certain big business interests and certain pressing consumer groups.

I know right Capitalist governments are notoriously corrupt.

So in example if a company is engaging in some sort of environmental degradation the government often creates random regulations which actually dosen't do anything and often are counterproductive.

Well... that you'll have to provide evidence for. And what do you consider "many?" Market regulations have a pretty good track record, wealthy capitalst whining aside.

While in a market system, through the rationality of the consumers, they could organize a boycott against the product the product and go to competitor products.

In the laissez faire society you imagine that boycott would forcibly be beaten down by the monied class. I should say "probably would." But history makes me just go ahead and say "would."

While other forms of regulation and interference into the market economy like Obama's recent health care bill(and national health care too) or investment into R&D and subsides(specifically agricultural) only end up helping big business.

I kno, right
Well... not "only" but ya... i agree

In the case of health care government control or regulation of health care aims to give high quality health care at an affordable price essentially to everyone. But in reality they only miss the overall problem of the lack of competition in the health care industry which drives up costs to enormous levels, and drains government coffers and basic people's pockets.

Hmmm... Crusoe's island type theorizing, or actual verifiable evidence....
I'm going w door number 2 Chuck

While direct government funding of R&D only seems to be helping the big business interests, as instead of worrying about them having to spend large amounts of money in order to order to stay competitive they can rely on the government.

It's rare for a capitalist to be against technological progress. They usually just deny the government's role in it. Well done
Now think about what would happen to progress if you remove the aspect of ownership's expropriation of surplus value.

While agricultural subsides encourage careless unproductivity and create artificially low prices and which make farmers in undeveloped nations unable to compete. Also don't forget about straight out government bailouts(which of course are only given to those "too big to fail"), if you fail don't worry the government will be right there to save you, this essentially encourages irresponsibility.

I kno, right
You're more of a socialist than you know friend. You just have to start critically examining that profit motive from a historical point of view.

The government is not a rational interest, it is a monopolistic force which seeks to serve its own interests. And I assume man can't fully understand the free market's effect on his financial prospects, but then again what can we fully understand? Trial and error for me is the basis of individualism, in a simplistic manner if I take cocaine and I find it gives me a negative reaction I won't take it again, or if I do continue taking it out of the case of addiction then I should individually seek action under my own accord understanding that my life is going in the wrong direction. The government dosen't need to tell us what's right and wrong, we can figure that out ourselves.

I would have to write paragraphs to express my disagreements here, but suffice it to say, I basically agree with this. The thing is, and it always is w center-leftist anarchist/minarchist capitalists... why do you stop at government? Why is Dick Clarke afforded the power you wouldn't dare put in the hands of Bill Clinton?

[Svoboda]

Actually there have been studies, and they show that "human nature" is not a static thing and is not predominantly selfish, and leans toward being more social. If you honestly don't believe me I'll look it up for you.

No you don't have definitive prove, in the past I have looked at sociological and physiological studies to answer the question, and they don't answer much, they seem to say that individuals certainly are willing to willing to enter into a group and perhaps sacrifice some of their interests but they ultimate want something. Look at an experiment of the prisoner's dilemma, and here are three examples which also test individuals working in collectives which test self interest:
[FONT=&quot]http://www.uiowa.edu/~grpproc/crisp/crisp.7.17.html
[/FONT][FONT=&quot]http://www.uiowa.edu/~grpproc/crisp/crisp.3.1.htm
[/FONT][FONT=&quot]http://www.uiowa.edu/~grpproc/crisp/crisp.6.12.htm
[/FONT]

Thats getting into philosophy, i.e. trying to define reality, not science, i.e. figuring out what the reality IS.

Well science can't solve everything, and the social sciences all too often end up contradicting themselves.

Right from the bat your wrong, there is no Consumer class, there is no choice in a market, the choices are dependant on your disposable income. Its money that controls the market, meaning those with more control more, those with just enough to survive don't have any sway on the market nor do they have any control.

They do sway the market, if there is demand for a product from any income level the market will meet it. The problem is the creation of artificial scarcity or caused either by government regulation or the cartelistaion of business(the problem of Capitalism).

THats why low income housing needs to be subsidised, as does food for hte poor, because the market won't take care of it, because it only cares about those with money.

You use the word market too loosely, and you have look at why prices are at the outrageous levels for the poor. Competition is allowed to exist under subsides, inefficiency is widespread, in example American, European and Japanese have massive agricultural subsides which protect their farmers and blood developing markets, eliminate competition and the income for the majority of those in the developing world.

And yes the Capitalist market dosen't care about the poor, and Capitalism will lead to the exploitation of the poor, therefore creating the need for individuals to create cooperative associations with each other to ensure their interest, where THEY HAVE CONTROL. In the state they have no real control. In the late nineteenth century and early 20th such associations were widespread in Europe and America, one example being health care associations where individuals basically paid a modest fee every month(or whenever) and would agree for all to be cared. The health care industry of course didn't like this and would get the state to stamp it out.

ONLY if that new product benefits the ruling class, if it benefits monied interests, thats why new weapons are being built all the time, thats why we have a new iphone all the time, but cheap medicine for curable deseases takes forever.

??? Profits are Profits entrepreneurs will invest in anything as long as it makes them money, be it weapons or cheap housing.

Again, your missing the elephant in the room, i.e. monied interests.

And your missing the interference of the state in the market.

THe difference is while big buisiness is ONLY responsible to the people that run the buisiness and own it, the government is responsible to the public, thast the difference.

Wrong business is nothing without people buying. You may say the workers may have no choice but to buy, what then what do you say of workers who went on strike in the late 19th and 20th century who had nothing, but still attempted to gain a living wage and a reasonable working conditions. Capital is nothing without workers just as it is nothing without consumers.

Or the company could just lie about it, because there are no laws preventing it, so no problem, also most likely competitors are also doing the same, because they'd save more money if they both agree to do it, also most likely people are not financially powerful enough to have an effective boycott.

Competitors would not ultimately make more money if they they hide their wrong doing, and form a cartel as you're alluding to, one company would naturally break the hold as they would see an opportunity to attain greater profit from showing the exploitation of their competitors. Cartels and Monopoly's can't exist without some outside enforcement like the state which will ensure it's existence.

That pipedream of how markets work is cartoonish and has nothing to do with reality.

And communism has had reality?

As far as healthcare, if they had a PUBLIC option, then things would have been different, cost would have been driven down, don't believe me? Look at the rest of the world.

Do you see how enormous the costs for health care are throughout the world? And why it's (partly) bankrupting Europe.

As for your other examples I agree, but thats not governments fault, thats because the Capitalist class has become SO powerful that they now hae a strangle hold an the government. In other countries where the Capitalist class did'nt develop so powerful, the government actually functions as a democracy.

Democracy is a dream.

Your libertarian ideologies are ones that are adored by big buisiness, because it gives them an excuse to cut every resembelance of public control of the economy possible, and give it all to themselves, people like you are the darlings of big buisiness, (its not about government, btw, its about a hatred of democracy, as is seen by their hatred of unions.)

No business fears such rhetoric they love having protection from the state.