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Will the global economy implode in 2016?
We're hosed - I have stocked up on canned goods
My private security guards will shoot the paupers
We'll be good or at least coast along
I have no earthly clue
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Uranium Phoenix
Jun 20, 2007

Boom.

caps on caps on caps posted:

Socialism is not a theoretical framework tho. It does not have any theory as to how to organize production and distribution of said production except for some bearded dude saying "people will literally change to be perfect once the system is perfect". No one knows what the perfect system is, just that it is not the current system. The argument in entirety is: Since A is bad, B must be better because it is not A.
Hence, Venezuela.

Just because you don't understand something doesn't mean no one does.

Socialism 101 is "the workers own the means of production," which is a theoretical framework on how production is organized. The fact that you apparently don't know that isn't a failing of anyone but yourself.

We can see social democracies (Norway, for example) where inequality is reduced by means of taxes and strong social programs, and we can see it that it leads to higher quality of life. This is not a perfect system, but there is ample evidence to show it is better. By creating economic rules where people own the place they work and their private property, income inequality is drastically reduced and the benefits of society are spread out evenly, instead of concentrated. The key reason for this is that you want to prevent that inequality from ever happening again (Capital in the 21st Century shows wealth concentration will happen without either an end to capitalism or a global tax system to prevent it). With solid social programs to make sure no one goes without things like housing, food, and healthcare, and more democracy in political, economic, and social institutions, we can reasonably say that the system would be better (The Spirit Level goes into depth about how reducing inequality has massive benefits to all aspects of society). After all, there are enough houses for everyone to live in, and there's enough food produced by the world for no one to go hungry; the problem is one of distribution. No one has claimed it a "perfect system," but it's demonstrably better than what we have and therefore is worth moving towards. To be clear, "Socialism" does not mean "full communism now," it doesn't even mean the end of markets or governments; it's merely a change in how production and wealth are distributed in society.

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Subjunctive
Sep 12, 2006

✨sparkle and shine✨

I think you're talking about a smaller fraction than 1% if you're describing them as super-rich. To be in the global 1% you need about $750K net worth. This describes the top 10-15% of Americans. If that comes largely from house equity, income may be a much lower percentile. They are probably living comfortably, but I don't think they are manipulating the global financial ecosystem beyond buying index funds.

Nice piece of fish
Jan 29, 2008

Ultra Carp

Pollyanna posted:

May I introduce you to a little something called democratic socialism?

Pretty cool and good, they'd be centrists where I live, in an ostensibly actual socially democratic utiopia.

MiddleOne
Feb 17, 2011

Subjunctive posted:

I think you're talking about a smaller fraction than 1% if you're describing them as super-rich. To be in the global 1% you need about $750K net worth. This describes the top 10-15% of Americans. If that comes largely from house equity, income may be a much lower percentile. They are probably living comfortably, but I don't think they are manipulating the global financial ecosystem beyond buying index funds.

If you have a net worth (you do know that net worth is the amount that assets exceed your liabilities, right?) of 750 000 then you're already rich enough to never have to work a day again in your life in any country on the globe.

Of course the global 1% is a dishonest measurement. If we say 'the global west' or god forbid 'the US' suddenly the number skyrockets. Flatly counting 1% worldwide also discounts just how many billionaries and multi-millionares there are in the larger third world economies.

Subjunctive
Sep 12, 2006

✨sparkle and shine✨

MiddleOne posted:

If you have a net worth (you do know that net worth is the amount that assets exceed your liabilities, right?) of 750 000 then you're already rich enough to never have to work a day again in your life in any country on the globe.

Yes, I know what net worth is. Being able to generate 45K of passive income (if everything is invested and the market is friendly) doesn't seem like someone who is pulling the levers of power.

MiddleOne
Feb 17, 2011

In reality these people do still work and they have humongous incomes both from labour and capital. They're your average upper class republican/Tory/CDU voter.




EDIT: Small note here, but at that level of liquid capital you can start using leveraging to massively increase your revenue through capital intensive investments such as real estate. Globally the common beginner's option is Mcdonalds, which is both very safe and lucrative.

MiddleOne fucked around with this message at 19:30 on Feb 25, 2017

Haramstufe Rot
Jun 24, 2016

Uranium Phoenix posted:

Just because you don't understand something doesn't mean no one does.

Socialism 101 is "the workers own the means of production," which is a theoretical framework on how production is organized. The fact that you apparently don't know that isn't a failing of anyone but yourself.

I have some questions:
1. So I create a start-up. I hire three programmers in addition to me. Now I own only 1/4 of my idea/company? Would that not reduce my incentive to start the company ex ante?
2. What gets voted on by workers and what is managed? Does everyone get the same wage? What's keeping a dominant coalition from hoarding all profits? Is there a rule on who gets to be CEO?
3. I guess we can not have capital markets because we can not invest in companies. How do investments happen? How do companies ever grow? How do we buy that new CNC machine we need but do not have the cashflow for. Debt?
4. Isn't it terribly inefficient for everyone to have the same share no matter what capital he brings into the company? If not, how will we realistically be able to control actual work contribution?
5. Is skill taken into account or does everyone get to decide on everything? Whats keeping Trump or Le Penn type of populist from killing the company for his/her own profit?



Uranium Phoenix posted:

We can see social democracies (Norway, for example) where inequality is reduced by means of taxes and strong social programs, and we can see it that it leads to higher quality of life. This is not a perfect system, but there is ample evidence to show it is better. By creating economic rules where people own the place they work and their private property, income inequality is drastically reduced and the benefits of society are spread out evenly, instead of concentrated. The key reason for this is that you want to prevent that inequality from ever happening again (Capital in the 21st Century shows wealth concentration will happen without either an end to capitalism or a global tax system to prevent it). With solid social programs to make sure no one goes without things like housing, food, and healthcare, and more democracy in political, economic, and social institutions, we can reasonably say that the system would be better (The Spirit Level goes into depth about how reducing inequality has massive benefits to all aspects of society). After all, there are enough houses for everyone to live in, and there's enough food produced by the world for no one to go hungry; the problem is one of distribution. No one has claimed it a "perfect system," but it's demonstrably better than what we have and therefore is worth moving towards. To be clear, "Socialism" does not mean "full communism now," it doesn't even mean the end of markets or governments; it's merely a change in how production and wealth are distributed in society.

wait, so Norway is the socialism we are talking about? Oh, so socialism is then a social market economy? Okay then.

In actuality, a proposal for a socialist system should not include any critique of capitalism and how things should be better (aka this eliminates 99% of all articles I read). Instead, it should be a proposal that stands on its own merits entirely.
Everyone can write a critique of a system. But things work the way they do because they are within the system. If you change it, you better be able to bring a good concept to the table on how poo poo works.
That's what I am looking to read.

BTW I find it funny tho that you take Piketty's theoretical model at face value, despite its technical shortcomings (don't get me wrong, the book is great even if just for the data). I mean, it's a pretty neoclassical model - which is I guess fine now as long as it shows r > g?

Haramstufe Rot fucked around with this message at 19:39 on Feb 25, 2017

Professor Beetus
Apr 12, 2007

They can fight us
But they'll never Beetus

caps on caps on caps posted:

I have some questions:
1. So I create a start-up. I hire three programmers in addition to me. Now I own only 1/4 of my idea/company? Would that not reduce my incentive to start the company ex ante?
2. What gets voted on by workers and what is managed? Does everyone get the same wage? What's keeping a dominant coalition from hoarding all profits? Is there a rule on who gets to be CEO?
3. I guess we can not have capital markets because we can not invest in companies. How do investments happen? How do companies ever grow? How do we buy that new CNC machine we need but do not have the cashflow for. Debt?
4. Isn't it terribly inefficient for everyone to have the same share no matter what capital he brings into the company? If not, how will we realistically be able to control actual work contribution?
5. Is skill taken into account or does everyone get to decide on everything? Whats keeping Trump or Le Penn type of populist from killing the company for his/her own profit?


wait, so Norway is the socialism we are talking about? Oh, so socialism is then a social market economy? Okay then.

In actuality, a proposal for a socialist system should not include any critique of capitalism and how things should be better (aka this eliminates 99% of all articles I read). Instead, it should be a proposal that stands on its own merits entirely.
Everyone can write a critique of a system. But things work the way they do because they are within the system. If you change it, you better be able to bring a good concept to the table on how poo poo works.
That's what I am looking to read.

BTW I find it funny tho that you take Piketty's theoretical model at face value, despite its technical shortcomings (don't get me wrong, the book is great even if just for the data). I mean, it's a pretty neoclassical model - which is I guess fine now as long as it shows r > g?

Holy moly maybe if you have such basic questions you should do some outside reading and then come back to the thread. You know that employee owned companies exist, right? And that they function pretty much the same as any other company except, whoa, lo and behold, employees enjoy livable wages, better benefits, and the ability to vote on company decisions. Is your mind blown yet?

Uranium Phoenix
Jun 20, 2007

Boom.

caps on caps on caps posted:

I have some questions:
1. So I create a start-up. I hire three programmers in addition to me. Now I own only 1/4 of my idea/company? Would that not reduce my incentive to start the company ex ante?
2. What gets voted on by workers and what is managed? Does everyone get the same wage? What's keeping a dominant coalition from hoarding all profits? Is there a rule on who gets to be CEO?
3. I guess we can not have capital markets because we can not invest in companies. How do investments happen? How do companies ever grow? How do we buy that new CNC machine we need but do not have the cashflow for. Debt?
4. Isn't it terribly inefficient for everyone to have the same share no matter what capital he brings into the company? If not, how will we realistically be able to control actual work contribution?
5. Is skill taken into account or does everyone get to decide on everything? Whats keeping Trump or Le Penn type of populist from killing the company for his/her own profit?
"Workers own the means of production" is a pretty broad framework, and there's a lot of ways it could work. If you want an example of a large company set up on a largely socialist model of collective ownership, there's the Mondragon Corporation to read up on, otherwise, you can research how worker cooperatives operate--and there's not just one way! There are actual examples to look at, so no need to go into hypotheticals.

caps on caps on caps posted:

wait, so Norway is the socialism we are talking about? Oh, so socialism is then a social market economy? Okay then.
No, you didn't follow my argument. Inequality = bad. Social democracies like Norway reduce inequality; that's good. Reducing inequality more would be even better. Socialism proposes to do that by stopping individuals from accumulating too much wealth/power/capital. Therefore, socialist policies are good.

caps on caps on caps posted:

In actuality, a proposal for a socialist system should not include any critique of capitalism and how things should be better (aka this eliminates 99% of all articles I read). Instead, it should be a proposal that stands on its own merits entirely.
Everyone can write a critique of a system. But things work the way they do because they are within the system. If you change it, you better be able to bring a good concept to the table on how poo poo works.
That's what I am looking to read.

BTW I find it funny tho that you take Piketty's theoretical model at face value, despite its technical shortcomings (don't get me wrong, the book is great even if just for the data). I mean, it's a pretty neoclassical model - which is I guess fine now as long as it shows r > g?
Plenty of socialist proposals can stand on their own merits. Again, the fact that you haven't bothered to read very much about the subject is not a failing of socialism. The idea that no one is allowed to critique the current system as part of their proposal is a rather strange, arbitrary limit you've come up with. If we're going to come up with the best system, doesn't it make sense to compare systems to see which one is best? If someone was advocating for Capitalism and pointing how how it was better than Feudalism, you wouldn't dismiss the proposal purely because it included a critique of the latter. Most socialist proposals include a critique of capitalism because if a system doesn't have major problems, it wouldn't be necessary to even come up with an alternative. Proposals are not invalid because they include critiques of other systems.

Do you disagree that capital tends to accumulate more and more wealth without interference? That's what I was citing Piketty on. Capital accumulating too much wealth is bad. Piketty's solution is "global tax on capital." Another solution is to eliminate the power of capital through socialism.

Haramstufe Rot
Jun 24, 2016

Uranium Phoenix posted:

"Workers own the means of production" is a pretty broad framework, and there's a lot of ways it could work. If you want an example of a large company set up on a largely socialist model of collective ownership, there's the Mondragon Corporation to read up on, otherwise, you can research how worker cooperatives operate--and there's not just one way! There are actual examples to look at, so no need to go into hypotheticals.

You know where I studied there was an institute of cooperative economics, so I am aware. I am also aware that there are pro's and con's.

But still, what about my questions?
Or are we already at the point where no concrete socialist system proposal exists and we are hand-waving "We'll think about that once Socialism is here?"

So you propose some people own share and others do not own shares, like Mondragon?
Because I was talking about a Socialist system, not a business organization. For cooperatives, as I said, some thing work and some things don't. But that's within the current system.


Uranium Phoenix posted:

No, you didn't follow my argument. Inequality = bad. Social democracies like Norway reduce inequality; that's good. Reducing inequality more would be even better. Socialism proposes to do that by stopping individuals from accumulating too much wealth/power/capital. Therefore, socialist policies are good.
But that's pure conjecture?
Social democracies are capitalist systems and things work in a capitalist system may, for many reasons, not work well in socialist systems. See Venezuela, for example. Socialism doesn't propose to reduce inequality in a capitalist system last time I checked.

Not that, you know, I don't agree with you on your actual inequality point. Far from it.
But the way you argue is just so wrong to me... sorry?


Uranium Phoenix posted:

Plenty of socialist proposals can stand on their own merits. Again, the fact that you haven't bothered to read very much about the subject is not a failing of socialism. The idea that no one is allowed to critique the current system as part of their proposal is a rather strange, arbitrary limit you've come up with. If we're going to come up with the best system, doesn't it make sense to compare systems to see which one is best?
True, but alternative systems have a long intellectual history of focusing on critique of market economies and then jumping to conclusions. See for example your conjecture that less inequality is always better and therefore a system without inequality is bestest.
It's a conjecture based on a critique without an actual basis in a political/economic alternative framework.


Uranium Phoenix posted:

If someone was advocating for Capitalism and pointing how how it was better than Feudalism, you wouldn't dismiss the proposal purely because it included a critique of the latter.

Someone could easily come to me with an exact plan of, say, Norway's economic and political system and then compare it to Feudalism. That's valid. That's not what Socialists with me tho.



Uranium Phoenix posted:

Most socialist proposals include a critique of capitalism because if a system doesn't have major problems, it wouldn't be necessary to even come up with an alternative. Proposals are not invalid because they include critiques of other systems.

nah, if proposals come with an actual valid plan then they are valid.


Uranium Phoenix posted:

Do you disagree that capital tends to accumulate more and more wealth without interference?
Depends on the system. Non interference market economies don't even work, so what interference are we talking about?
Without more information my answer is probably no, I do not disagree.


Uranium Phoenix posted:

That's what I was citing Piketty on. Capital accumulating too much wealth is bad. Piketty's solution is "global tax on capital." Another solution is to eliminate the power of capital through socialism.

Dunno about either those solutions, the first could be possible eventually. The second has the issue that no socialism actually exists and if it existed, it failed miserably, and so while we could eliminate the power of capital, we don't know what else we eliminate with it, right?

Haramstufe Rot fucked around with this message at 20:45 on Feb 25, 2017

uncop
Oct 23, 2010

caps on caps on caps posted:

I have some questions:
1. So I create a start-up. I hire three programmers in addition to me. Now I own only 1/4 of my idea/company? Would that not reduce my incentive to start the company ex ante?
2. What gets voted on by workers and what is managed? Does everyone get the same wage? What's keeping a dominant coalition from hoarding all profits? Is there a rule on who gets to be CEO?
3. I guess we can not have capital markets because we can not invest in companies. How do investments happen? How do companies ever grow? How do we buy that new CNC machine we need but do not have the cashflow for. Debt?
4. Isn't it terribly inefficient for everyone to have the same share no matter what capital he brings into the company? If not, how will we realistically be able to control actual work contribution?
5. Is skill taken into account or does everyone get to decide on everything? Whats keeping Trump or Le Penn type of populist from killing the company for his/her own profit?

1. The company owes you money for your unpaid contributions to it. For example, your unpaid salary could be likened to credit, while your idea could be likened to voteless shares. This debt has to be paid, and there ought to be no legal way for your employees to decide to default on it if the company doesn't go bankrupt. Sort of like how the constitution sets limit on state democratic choices. There's also the possibility for founders to have a larger amount votes, or recent hires to have less, so that stability is preserved in the early phases of expansion.

2. These things are currently and also should be decided by the company itself. Typically people do not get the same wage (but the range is limited). Who and what the CEO is is voted on. The share of management and voting is decided on a practical basis, but there's a tendency to have way less managers than in the average capitalist company. And again, such a company cannot be legally taken over and its rules ignored by even a majority, much like a state cannot.

3. We can have capital markets, however we can't exchange power for money, only future profits. I'm pretty sure this is a solved problem already, since co-ops have no problems growing. You can take loans, sell voteless shares, agree among members to invest a certain amount each, get subsidized by the state and so on.

4. The workers together decide which work is worth which salary. It isn't historically terribly difficult to find a solution most can agree on. Profits are shared according to everyone's investment, which is often, but not always, considered equal either in an absolute sense or per labor-hour. Profit tends to have a smaller role than in capitalist companies though, because salary raises are a natural way to distribute surplus fairly.

5. The direct democratic ideal is that people decide on things that concern them. Something like CEO choice is probably decided by everyone, while everyday details of work are decided by the ones doing that work. People with skill tend to command certain respect since they're people who the voters personally know and their opinions are listened to. They're like lobbyists. And yeah, the company cannot be taken over by a rogue CEO because there are strict limitations on what a CEO can do without a majority vote. (There does not need to be a CEO at all, but it's the same with any governing entity.) I'm not an expert on what exactly those limitations tend to be, but it's a tried and tested thing in the real world.

Uranium Phoenix
Jun 20, 2007

Boom.

caps on caps on caps posted:

You know where I studied there was an institute of cooperative economics, so I am aware. I am also aware that there are pro's and con's.

But still, what about my questions?
Or are we already at the point where no concrete socialist system proposal exists and we are hand-waving "We'll think about that once Socialism is here?"

So you propose some people own share and others do not own shares, like Mondragon?
Because I was talking about a Socialist system, not a business organization. For cooperatives, as I said, some thing work and some things don't. But that's within the current system.
Your questions are basically asking about how socialist businesses would work. I point out there are working examples of worker-owned businesses that you could research and you say both "but what about my questions?" and "no no, socialist system, not business organization." There's not one way to do socialism, just like there's not one way to do capitalism.

I can't point you to a fully working socialist system and the research within it because it doesn't currently exist. You seem to want me to talk about how exactly a socialist system would work in specific detail, which is not a question that can be answered in a single forums post; it would take a book. In fact, people have written books about it. You might check out the Marxism thread for suggestions on how to learn more!

caps on caps on caps posted:

But that's pure conjecture?
Social democracies are capitalist systems and things work in a capitalist system may, for many reasons, not work well in socialist systems. See Venezuela, for example. Socialism doesn't propose to reduce inequality in a capitalist system last time I checked.

Not that, you know, I don't agree with you on your actual inequality point. Far from it.
But the way you argue is just so wrong to me... sorry?
Again, you're demonstrating you basically know nothing about socialism. You've already shown you can't define it in the most basic form, nor do you seem to have any conception of what its proponents want. Next, some quick googling shows Venezuela has around 1 million people in worker-owned businesses, and a working population of around 20 million (of 30 million total population). It doesn't really fit a reasonable definition of "workers own the means of production in the economy," and it also has some very powerful capitalists.

quote:

True, but alternative systems have a long intellectual history of focusing on critique of market economies and then jumping to conclusions. See for example your conjecture that less inequality is always better and therefore a system without inequality is bestest.
It's a conjecture based on a critique without an actual basis in a political/economic alternative framework.

Someone could easily come to me with an exact plan of, say, Norway's economic and political system and then compare it to Feudalism. That's valid. That's not what Socialists with me tho.
Think about before capitalism really existed, say, in Europe, when the dominate economic form was feudalism. By your logic, no one could argue that it was bad because any other ideas they proposed, like capitalism, would be conjecture. Even if people could point to efficient markets, or how rich merchants were able to do X or Y better than feudal monarchs, or how quality of life was better in small non-feudal communities, those would exist in a largely feudalist system so would, under your logic, be invalid. It's like if you dismissed the theory of relativity before it had a chance to get tested based on the idea that it wasn't tested yet.

My claim that inequality is bad and that reducing inequality is good is not conjecture; I cited The Spirit Level for that claim and it is amply backed by evidence in that book. Because I probably have to point it out, I don't believe "everyone in society will literally be 100% equal" because that's neither ideal nor possible.

quote:

Depends on the system. Non interference market economies don't even work, so what interference are we talking about?
Without more information my answer is probably no, I do not disagree.
Okay, that wasn't a trick question or anything, I think we're on the same page here. We at least seem to agree that 1) capital, without adequate regulations, will tend towards increasing inequality and 2) inequality is bad. The disagreement is on the solution.

quote:

Dunno about either those solutions, the first could be possible eventually. The second has the issue that no socialism actually exists and if it existed, it failed miserably, and so while we could eliminate the power of capital, we don't know what else we eliminate with it, right?
Any time socialism is attempted, especially on the scale of nations, there's an attempt to destroy it. In South America in Chile, for example, a democratically elected socialist was assassinated via US backed military coup. You can't have roving superpowers like the US or the dictatorial Soviet Union imposing their will on countries through economic or conventional warfare (sometimes through proxies like the IMF) and then only blame the country's internal economic policy as the single reason for failure. That's true for any country attempting any sort of different economic policy, from Cuba or Chile attempting to throw off US corporate control to Poland or Yugoslavia under the Soviet Union.

Gunshow Poophole
Sep 14, 2008

OMBUDSMAN
POSTERS LOCAL 42069




Clapping Larry

caps on caps on caps posted:

I have some questions:



I know it's not exactly proper to pile on posters but you shouldn't be asking questions as fundamental as this. You should be doing a slightly-deeper-than-Google-scrape-of-Wikipedia bit of research before you even post.

Thank you to the last two posters for legitimately attempting to engage this guy but... seriously?

Haramstufe Rot
Jun 24, 2016

cool, I have some more questions, cause I like to understand things by working through concrete cases - I think that's really useful to see how fleshed out these socialism ideas/theories are.

uncop posted:

1. The company owes you money for your unpaid contributions to it. For example, your unpaid salary could be likened to credit, while your idea could be likened to voteless shares. This debt has to be paid, and there ought to be no legal way for your employees to decide to default on it if the company doesn't go bankrupt. Sort of like how the constitution sets limit on state democratic choices. There's also the possibility for founders to have a larger amount votes, or recent hires to have less, so that stability is preserved in the early phases of expansion.
or possibly comments

I am really interested in how this is supposed to work in practice.
Say I own the majority of the company (up until contribution from workers, let's say the profits are equally split from when they enter but I retain my shares on existing capital and idea) but they have the same voting rights (so each gets one in my example?). Can I sell my shares if I don't agree with the votes? Or can I take my idea somewhere else? If not, can I quit and start a company doing the same thing? Or sell the idea and tech to a competitor and just wait until my company crashes? After all I still own the idea, right?


uncop posted:

2. These things are currently and also should be decided by the company itself. Typically people do not get the same wage (but the range is limited). Who and what the CEO is is voted on. The share of management and voting is decided on a practical basis, but there's a tendency to have way less managers than in the average capitalist company. And again, such a company cannot be legally taken over and its rules ignored by even a majority, much like a state cannot.

So l understand you right: The company sets a constitution like a state, that can not be changed? But that must be state regulated, right? If not, the early coalition would just write a constitution which is advantageous to the core workers and lovely for newer workers (see Mondragons issues). That means those things can not really decided by the company I'd say.
Or, what's keeping me from choosing a more efficient way of structuring the company when I work in a field where co-ops are not most efficient (after all, I am free to make a co-op today as well if I think it efficient)? Clearly, the state can not allow the companies to decide by themselves as long as they are in competition.
In certain fields, would that not push all businesses towards the most un-coop border set by law lest they be outcompeted? If so, isn't this basically equal to just regulating wages?


uncop posted:

3. We can have capital markets, however we can't exchange power for money, only future profits. I'm pretty sure this is a solved problem already, since co-ops have no problems growing. You can take loans, sell voteless shares, agree among members to invest a certain amount each, get subsidized by the state and so on.

So if I buy the majority shares on your profits such that let's say I'll get 55% of future profits for myself, would that really solve the inequality problem? Clearly I have no obligation towards that company since I am not voting in its decisions (otherwise that would not make sense either). So then, voting rights are just about the distribution of non-share allocated profits, right? In the lifetime of many larger businesses there comes a time when a significant amount of shares have to be issued to progress or survive. But those shares don't usually need to give as high return, if at all, given that they come with voting rights. If they don't, returns obviously need to be higher for the same amount. I'd be worried that this pushes return-seeking investors into even more frenzied buying sprees and makes the capital markets more volatile. Another issue I see is that if workers vote, then they can decide the dividends (and if not, the company would just bankrupt itself by inflexible capital payments). Then, however, they have the incentive to push out investors who in return will need higher interest.
Seems like capital markets would be really high risk and illiquid. This could be a serious issue for growth and innovation?

I mean I understand that coops exist IRL, but they are not exactly the most successful companies and they are mostly prevalent in certain industries, and usually in countries which have co-ops also for historic reasons (Germany, France, Spain). Germany, for example, has a shitton of coops and they do really well for specific businesses which target the shareholders themselves. Everywhere else, they have less success. There is actually theory on coops based on transaction costs and principal agent to suggest that they have pro's and con's. Logically, a world with only coops would be inefficient then.

uncop posted:

4. The workers together decide which work is worth which salary. It isn't historically terribly difficult to find a solution most can agree on. Profits are shared according to everyone's investment, which is often, but not always, considered equal either in an absolute sense or per labor-hour. Profit tends to have a smaller role than in capitalist companies though, because salary raises are a natural way to distribute surplus fairly.

Let me look at that in two contexts. First, how do you attract good workers to your company? Let's say you are drilling in the Baltic Sea and you need a geologist specialized in water and rock movement around drilling platform supports. There's not so many of those in Europe, so the usual thing to do is to hire him for a lot of money. But now this guy makes a significant amount more than normal workers because his skill is scarce. And if not, the guy will just start a single-person consulting business and make millions anyways. Or consider the case of hiring a CEO. The guy is a decent leader but not really worth all that much, except without his network it's difficult to get leads and new customers. Workers are clearly unwilling to give up wages to pay for such a person, nevertheless a company may be out-competed by another who has this guy.

Second, we know to illicit honest work without endless shirking (see GDR for the negative case here), compensation needs to have at least two components - a fixed part and a performance based part (possibly more). The performance based part can be very rough, like getting fired, but that's just a trade-off between efficiency and difficulty of implementation. Empirically, better compensation schemes increase productivity. Paying everyone the same wage would obviously lead to terrible productivity - some performance based measure needs to exist.
But implementing this requires the workers input. Therefore, they have an incentive to vote tactically. We know that in these situations, voting is not really so cool because it's either dictatorial, allows tactical voting or some worker group will get shafted on their salaries in favor of another (one of these three things are necessarily true).
And all these decisions have to conform to the market conditions such that workers will not just leave to somewhere else, or the company's products become too expensive to sell.
How do you solve this dilemma?


uncop posted:

5. The direct democratic ideal is that people decide on things that concern them. Something like CEO choice is probably decided by everyone, while everyday details of work are decided by the ones doing that work. People with skill tend to command certain respect since they're people who the voters personally know and their opinions are listened to. They're like lobbyists. And yeah, the company cannot be taken over by a rogue CEO because there are strict limitations on what a CEO can do without a majority vote. (There does not need to be a CEO at all, but it's the same with any governing entity.) I'm not an expert on what exactly those limitations tend to be, but it's a tried and tested thing in the real world.

cool, I don't have more questions except the above.


Uranium Phoenix posted:

Your questions are basically asking about how socialist businesses would work. I point out there are working examples of worker-owned businesses that you could research and you say both "but what about my questions?" and "no no, socialist system, not business organization." There's not one way to do socialism, just like there's not one way to do capitalism.

Well I am literally part of a cooperative - my bank. My questions are not answered by researching my bank. I have googled, but I have not found a concrete systemic proposal for a socialist system. Maybe I am bad at googling.
But to be quite honest, and from the reaction in this thread, I think it might also be that the emperor really has no clothes. Maybe nobody really knows what socialism is supposed to look like.


Uranium Phoenix posted:

I can't point you to a fully working socialist system and the research within it because it doesn't currently exist. You seem to want me to talk about how exactly a socialist system would work in specific detail, which is not a question that can be answered in a single forums post; it would take a book. In fact, people have written books about it. You might check out the Marxism thread for suggestions on how to learn more!

Since you know my concerns, could you point me to a good book or academic article (perhaps a review article) which is heavy on concrete, workable proposals and light on rehashing critiques on capitalism? I have read Marx & Schumpeter if that helps.


Uranium Phoenix posted:

Again, you're demonstrating you basically know nothing about socialism. You've already shown you can't define it in the most basic form, nor do you seem to have any conception of what its proponents want. Next, some quick googling shows Venezuela has around 1 million people in worker-owned businesses, and a working population of around 20 million (of 30 million total population). It doesn't really fit a reasonable definition of "workers own the means of production in the economy," and it also has some very powerful capitalists.

Venezuela may or may not be socialist, but it is a state where things which work very well in, for example, Europe (price controls, subsidies etc.) have catastrophic consequences because the system is not organized in the same way. In Europe, we understand very well what such measures might do. But in Venezuela, no one has the slightest idea. Of course it's a terrible system - but maybe so is socialism!

That's why it is an example.



Uranium Phoenix posted:

Think about before capitalism really existed, say, in Europe, when the dominate economic form was feudalism. By your logic, no one could argue that it was bad because any other ideas they proposed, like capitalism, would be conjecture. Even if people could point to efficient markets, or how rich merchants were able to do X or Y better than feudal monarchs, or how quality of life was better in small non-feudal communities, those would exist in a largely feudalist system so would, under your logic, be invalid. It's like if you dismissed the theory of relativity before it had a chance to get tested based on the idea that it wasn't tested yet.

No that's not what I said. But to test a theory, a theory has to exist. That markets are more efficient than gold-based mercantilism is a valid theoretical proposition that does not depend on the system at all, but is a concrete theory of allocation. Of course now we can formulate that much better than early writers of the time, but certainly the effort was made.

But "less inequality the better, no inequality the best" is not an actual theory.

"Less inequality is better in a market democracy" is a better proposition and it is actually also not true for every level imo. There is an elusive, dynamic optimum of inequality that is lower than what is reality in almost everywhere in the world. But this depends critically on the current market institutions, specifically education and labor markets but also product markets.
Nothing of this translates necessarily to another system, not even to another country. I am willing to demand less inequality because I firmly believe the optimum is below what we currently have, but I really don't have a theory to prove it beyond the current academic articles, that, I am sure, you are aware of.


The efficiency of a market system, on the other hand, can be proven by information theoretical standpoints. And even that is a much more deep argument because not every market system is efficient in every case.
But, for example, we know that a price-based system weakly dominates every other possible allocation mechanism in many situations and we know that a price based allocation is the most informational efficient way to do so, an argument that is independent of economic system.

I am all for this poo poo if it exists for socialism


Uranium Phoenix posted:

My claim that inequality is bad and that reducing inequality is good is not conjecture; I cited The Spirit Level for that claim and it is amply backed by evidence in that book. Because I probably have to point it out, I don't believe "everyone in society will literally be 100% equal" because that's neither ideal nor possible.

What's ideal then?


Uranium Phoenix posted:

Okay, that wasn't a trick question or anything, I think we're on the same page here. We at least seem to agree that 1) capital, without adequate regulations, will tend towards increasing inequality and 2) inequality is bad. The disagreement is on the solution.


Any time socialism is attempted, especially on the scale of nations, there's an attempt to destroy it. In South America in Chile, for example, a democratically elected socialist was assassinated via US backed military coup. You can't have roving superpowers like the US or the dictatorial Soviet Union imposing their will on countries through economic or conventional warfare (sometimes through proxies like the IMF) and then only blame the country's internal economic policy as the single reason for failure. That's true for any country attempting any sort of different economic policy, from Cuba or Chile attempting to throw off US corporate control to Poland or Yugoslavia under the Soviet Union.

I don't disagree that the last fifty years are not exactly a good showcase to judge socialism. But we can look at specific issues in these countries and a detailed analysis - as has been done - does show many systemic issues in communist or socialist countries. I know a lot about the GDR, less about South America, so my statements about Venezuela was really just to illustrate that there are worse systems than capitalism and that in those systems, things which are perfectly fine in Norway lead to lovely outcomes.

Anyway, we know some things about how economies work whether they are capitalism or socialism or whatever else. This knowledge, applied to socialism and to existing examples, leads to some serious questions - not necessarily mine of course.
So your claim was that reduced inequality leads to better outcomes. We already know this to be true, to an extend, in European economies, so one solution would be to roll with this. On the other hand, there is a lot of reasons to belief that you will trade inequality with economic inefficiency in socialism - historical analysis as well as theoretical analysis.

If we already have a system where we can improve things and where we know a lot about how things work (and can actually analyze it scientifically), doesn't is make sense to be skeptical of socialism? If socialism doesn't promise more than less inequality, and is probably a lot worse in other areas?


Ol Standard Retard posted:

I know it's not exactly proper to pile on posters but you shouldn't be asking questions as fundamental as this. You should be doing a slightly-deeper-than-Google-scrape-of-Wikipedia bit of research before you even post.

Why tho? I see tons of people posting the most ridiculous crap which shows they obviously have not done deep research into economics, politics or history before they post. Am I breaking some sort of sacred rule by treating socialism the same way? Should I show more reverence?

Lighten up buddy.


MiddleOne posted:

All of these things, with the exception of selling your shares, would be just as illegal under a socialist market system as they already are under a neo-liberal market system. All that's really changing in your example here is who controls the board.

So I can sell my shares to the competitor company, but even though they own the majority of the company now, they are not actually allowed to do anything like take the tech and develop their own product?
That doesn't really sound like how things work now. If I sell my company to which I own 75% to facebook, then facebook gonna get the tech. Perhaps I misunderstand.

your edit

MiddleOne posted:

The idea could be separated from the company but typically that would have to happen under some kind of royalty agreement just like in the real world.

What I mean is that clearly if its socialism, I can not really own my own company, nor idea, nor anything else because it's just paradoxical and antithetical to no privately owned capital. But then many business forms, like start-ups, are just not possible.


Also this situation: Imagine I am like a ingenious inventor building some cool machine, but I need to hire three cleaning staff. Now they vote for something stupid and I quit the company. The company now does nothing, and I start a new one. I have basically fired them. How does this make sense in a socialist system?




Haramstufe Rot fucked around with this message at 10:46 on Feb 26, 2017

Lucy Heartfilia
May 31, 2012


caps on caps on caps posted:

I have some questions:
1. So I create a start-up. I hire three programmers in addition to me. Now I own only 1/4 of my idea/company? Would that not reduce my incentive to start the company ex ante?
2. What gets voted on by workers and what is managed? Does everyone get the same wage? What's keeping a dominant coalition from hoarding all profits? Is there a rule on who gets to be CEO?
3. I guess we can not have capital markets because we can not invest in companies. How do investments happen? How do companies ever grow? How do we buy that new CNC machine we need but do not have the cashflow for. Debt?
4. Isn't it terribly inefficient for everyone to have the same share no matter what capital he brings into the company? If not, how will we realistically be able to control actual work contribution?
5. Is skill taken into account or does everyone get to decide on everything? Whats keeping Trump or Le Penn type of populist from killing the company for his/her own profit?

https://en.wikipedia.org/wiki/Mondragon_Corporation

Edit: Already been posted. Sorry.

Lucy Heartfilia fucked around with this message at 10:27 on Feb 26, 2017

MiddleOne
Feb 17, 2011

caps on caps on caps posted:

I am really interested in how this is supposed to work in practice.
Say I own the majority of the company (up until contribution from workers, let's say the profits are equally split from when they enter but I retain my shares on existing capital and idea) but they have the same voting rights (so each gets one in my example?). Can I sell my shares if I don't agree with the votes? Or can I take my idea somewhere else? If not, can I quit and start a company doing the same thing? Or sell the idea and tech to a competitor and just wait until my company crashes? After all I still own the idea, right?

All of these things, with the exception of selling your shares, would be just as illegal under a socialist market system as they already are under a neo-liberal market system. All that's really changing in your example here is who controls the board.

The idea could be separated from the company but typically that would have to happen under some kind of royalty agreement just like in the real world.

MiddleOne fucked around with this message at 10:36 on Feb 26, 2017

uncop
Oct 23, 2010

caps on caps on caps posted:

Say I own the majority of the company (up until contribution from workers, let's say the profits are equally split from when they enter but I retain my shares on existing capital and idea) but they have the same voting rights (so each gets one in my example?). Can I sell my shares if I don't agree with the votes? Or can I take my idea somewhere else? If not, can I quit and start a company doing the same thing? Or sell the idea and tech to a competitor and just wait until my company crashes? After all I still own the idea, right?

The right to get the company to buy back your share depends on type of the share, but I think it would make sense for this sort of "founder share". Or you could just quit but keep your shares and enjoy the dividends. Your shares might not be as well protected as in a capitalist society however, maybe their value would be diluted as accumulating worker effort gets calculated into the pie, maybe the company could force you to sell them back at some rate that's deemed fair at the time. However, you can't just take your idea and run, privately owned patents probably wouldn't be a thing in an actual socialist society. So you'd have nothing to sell, at best you could start a competitor or begin working in one.

caps on caps on caps posted:

So l understand you right: The company sets a constitution like a state, that can not be changed? But that must be state regulated, right? If not, the early coalition would just write a constitution which is advantageous to the core workers and lovely for newer workers (see Mondragons issues). That means those things can not really decided by the company I'd say.
Or, what's keeping me from choosing a more efficient way of structuring the company when I work in a field where co-ops are not most efficient (after all, I am free to make a co-op today as well if I think it efficient)? Clearly, the state can not allow the companies to decide by themselves as long as they are in competition.
In certain fields, would that not push all businesses towards the most un-coop border set by law lest they be outcompeted? If so, isn't this basically equal to just regulating wages?

Co-ops today set their own rules about how they do business and that's what I likened to a constitution. Changing those rules tends to be a lot easier than changing a constitution, but it usually still requires a universal vote and more than a simple majority. States would have to regulate minimal sanity check limitations on those rules, for example right now you can't legally define a nondemocratically ruled co-op. But yeah, I'm sure people in a free society would find ways to make unequitable rules anyway. Democratic but private companies are a market socialist thing, and market socialism still has many core weaknesses of capitalism that would have to be alleviated by centralized wealth transfers or a similar system. A public sector would have to act to maintain full employment so that workers would be able to realistically choose a workplace that they don't find unfair.

What you're saying about a situation where exploitative structures are the most efficient is a huge reason why socialists including Marx tend to favor planning over markets. However, I still personally see having markets as the natural choice for now, since an early socialist state would still be in international competition with capitalist states and trading with them.

caps on caps on caps posted:

So if I buy the majority shares on your profits such that let's say I'll get 55% of future profits for myself, would that really solve the inequality problem? Clearly I have no obligation towards that company since I am not voting in its decisions (otherwise that would not make sense either). So then, voting rights are just about the distribution of non-share allocated profits, right? In the lifetime of many larger businesses there comes a time when a significant amount of shares have to be issued to progress or survive. But those shares don't usually need to give as high return, if at all, given that they come with voting rights. If they don't, returns obviously need to be higher for the same amount. I'd be worried that this pushes return-seeking investors into even more frenzied buying sprees and makes the capital markets more volatile. Another issue I see is that if workers vote, then they can decide the dividends (and if not, the company would just bankrupt itself by inflexible capital payments). Then, however, they have the incentive to push out investors who in return will need higher interest.
Seems like capital markets would be really high risk and illiquid. This could be a serious issue for growth and innovation?

What you say is true, the current style of capital markets would not combine well with socialist enterprise. It's questionable whether you could even have banking as free enterprise, since finance is pure rent-seeking and thus incompatible with socialist ethics. A working financial system is necessary, however, so it might end up as a publicly owned, centrally planned thing.

If finance were free, there would definitely be accumulating economic inequality and that inequality would undermine democracy just like now. But if public finance was the default, that should tame the profit expectations of capital markets and also their importance as a part of the economy. Maybe they would not be needed at all.

caps on caps on caps posted:

I mean I understand that coops exist IRL, but they are not exactly the most successful companies and they are mostly prevalent in certain industries, and usually in countries which have co-ops also for historic reasons (Germany, France, Spain). Germany, for example, has a shitton of coops and they do really well for specific businesses which target the shareholders themselves. Everywhere else, they have less success. There is actually theory on coops based on transaction costs and principal agent to suggest that they have pro's and con's. Logically, a world with only coops would be inefficient then.

The research you mentioned accurately describes consumer co-ops. Most of the existing big co-ops are consumer co-ops, which are different from worker co-ops and actually not very socialist. It's why socialists tend to mention Mondragon as opposed to other big co-ops in Europe. Actual worker co-ops are generally a tiny part of any economy and need more testing, but testing would require active state policy that helps worker co-ops form. Basically you just can't get adequate free market money to aggressively expand a beginning worker co-op when there are so many more lucrative options out there.

caps on caps on caps posted:

Let me look at that in two contexts. First, how do you attract good workers to your company? Let's say you are drilling in the Baltic Sea and you need a geologist specialized in water and rock movement around drilling platform supports. There's not so many of those in Europe, so the usual thing to do is to hire him for a lot of money. But now this guy makes a significant amount more than normal workers because his skill is scarce. And if not, the guy will just start a single-person consulting business and make millions anyways. Or consider the case of hiring a CEO. The guy is a decent leader but not really worth all that much, except without his network it's difficult to get leads and new customers. Workers are clearly unwilling to give up wages to pay for such a person, nevertheless a company may be out-competed by another who has this guy.

I think that the workers would have to compromise on wage equality to attract foreign talent, and they would end up doing it for the sake of their own job security. If they're a truly special person, they would be reasoned to be in a job category of their own, vital enough to deserve greater salary. And really, when talking about regular experts rather than pampered CEOs, their salary expectations aren't unsustainably huge. 200k compared to 20k is just 10x difference. I don't think they could compete in the international CEO market though, for better or worse. They would have to use other avenues of finding "leads and customers".

caps on caps on caps posted:

Second, we know to illicit honest work without endless shirking (see GDR for the negative case here), compensation needs to have at least two components - a fixed part and a performance based part (possibly more). The performance based part can be very rough, like getting fired, but that's just a trade-off between efficiency and difficulty of implementation. Empirically, better compensation schemes increase productivity. Paying everyone the same wage would obviously lead to terrible productivity - some performance based measure needs to exist.
But implementing this requires the workers input. Therefore, they have an incentive to vote tactically. We know that in these situations, voting is not really so cool because it's either dictatorial, allows tactical voting or some worker group will get shafted on their salaries in favor of another (one of these three things are necessarily true).
And all these decisions have to conform to the market conditions such that workers will not just leave to somewhere else, or the company's products become too expensive to sell.
How do you solve this dilemma?

We have to remember that money is not the most important motivation for most people to do their work well. The soviet communist system of employment was equivalent to mediocre capitalist companies' system of employment, meaning that aside from lack of monetary motivation, there was also a lack of any other kind of motivation to work hard. I would actually look at how modern low hierarchy capitalist companies motivate their employees. There are a lot of methods that workers will find acceptable, given that in low hierarchy companies most ideas are provided by the workers themselves. Also, salaries that include a performance based part tend to be found equitable as long as the base salary is large enough not to be stressful. Psychologically people tend to like rewards for winning and hate punishment for losing, and socialism's concern is not punishing the losers rather than not rewarding the winners.

About relying on worker votes, it's been noticed that people vote for their employment to be as secure as possible, so the aggregate tends to vote in favor of company stability and success. That is, as long as the company is sure to guarantee new jobs for workers that its decisions displace, because otherwise people are likely to vote for stagnancy, which would cause instability. That guarantee might be a core motivation for Mondragon to have grown so huge, since obviously the profit motive doesn't really explain it.

Haramstufe Rot
Jun 24, 2016

uncop posted:

The right to get the company to buy back your share depends on type of the share, but I think it would make sense for this sort of "founder share". Or you could just quit but keep your shares and enjoy the dividends. Your shares might not be as well protected as in a capitalist society however, maybe their value would be diluted as accumulating worker effort gets calculated into the pie, maybe the company could force you to sell them back at some rate that's deemed fair at the time. However, you can't just take your idea and run, privately owned patents probably wouldn't be a thing in an actual socialist society. So you'd have nothing to sell, at best you could start a competitor or begin working in one.

Alright that works, but retains the issue that as soon as I hire someone, I have to basically sell all my ideas and their future applications or revenues for future profit streams of a company I can not control. This means I am giving up something, since it is unlikely a cooperative would be a) as efficient in every sector and b) profit streams are not the goal of the whole undertaking anyway. This carries over to any sort of compensation I'd say beyond just monetary profits (because the giving up part is the whole idea).
So we should conjecture that innovation&entrepreneurial incentives are lower in a socialist society. I'd say data supports this conjecture.

uncop posted:

Co-ops today set their own rules about how they do business and that's what I likened to a constitution. Changing those rules tends to be a lot easier than changing a constitution, but it usually still requires a universal vote and more than a simple majority. States would have to regulate minimal sanity check limitations on those rules, for example right now you can't legally define a nondemocratically ruled co-op. But yeah, I'm sure people in a free society would find ways to make unequitable rules anyway. Democratic but private companies are a market socialist thing, and market socialism still has many core weaknesses of capitalism that would have to be alleviated by centralized wealth transfers or a similar system. A public sector would have to act to maintain full employment so that workers would be able to realistically choose a workplace that they don't find unfair.
As I said elsewhere, voting is not a guarantee for fairness towards all workers, nor is it for welfare maximization (see Trump). It also carries huge transaction costs. There'd be a lot of time and productivity invested into campaigning, so in practice only few things would be voted on by all workers. This means, the constitution moderating the management would ultimately have to guarantee fairness and efficiency and by extension, the minimal rules of the state would have to be elaborate enough to accommodate this. Again, Mondragon for example, lacking such rules, exploits parts of its workers to the benefit of shareholding workers. Clearly regulations against this need to be in place.
This means organizations would be a lot less flexible than they are now and, by necessity, much more centrally planned than we might imagine.
So here this would lead to efficiency loss in the many sectors where static rule sets are not a good idea (which is most in my impression)


uncop posted:

What you're saying about a situation where exploitative structures are the most efficient is a huge reason why socialists including Marx tend to favor planning over markets. However, I still personally see having markets as the natural choice for now, since an early socialist state would still be in international competition with capitalist states and trading with them.

Yeah I agree. It's hard to judge the efficiency losses we incur by such a system, of course, but it's pretty clear that the equal distribution is bought with a lot of efficiency loss in any case.

Like I guess my main point is that there's a ton of things we can do in the current system, which seems to have many advantages over more centrally planned approaches.. if we really wanted.


uncop posted:

What you say is true, the current style of capital markets would not combine well with socialist enterprise. It's questionable whether you could even have banking as free enterprise, since finance is pure rent-seeking and thus incompatible with socialist ethics. A working financial system is necessary, however, so it might end up as a publicly owned, centrally planned thing.

If finance were free, there would definitely be accumulating economic inequality and that inequality would undermine democracy just like now. But if public finance was the default, that should tame the profit expectations of capital markets and also their importance as a part of the economy. Maybe they would not be needed at all.

I agree that equity is probably not compatible with a socialist system for the stated reasons. But relying on public debt in a democracy is also highly problematic, in that the consequences are not fairly distributed among voters and generations. We can see that all over the world.

In any case, a centrally planned financial sector would necessitate state planning on a scale which we are currently unable to provide. Solving these sorts of problems with incentive compatibility is computationally so difficult, that I am not sure it is possible.



uncop posted:

The research you mentioned accurately describes consumer co-ops. Most of the existing big co-ops are consumer co-ops, which are different from worker co-ops and actually not very socialist. It's why socialists tend to mention Mondragon as opposed to other big co-ops in Europe. Actual worker co-ops are generally a tiny part of any economy and need more testing, but testing would require active state policy that helps worker co-ops form. Basically you just can't get adequate free market money to aggressively expand a beginning worker co-op when there are so many more lucrative options out there.

Well, one might disagree with profit seeking but I think it's clear that in many industries (so, the ones where a small cooperative would be a potential entry) companies are lucrative for investors if they are more productive than their competitors. The inability of coops to be a valid choice as a business format tell us more, because of course we can acquire funds on debt markets and we even can trade future profit streams for capital today. We also do not see a higher prevalence of coops where capital requirements are low (not at all).
So according to economic theory, coops make sense for markets with certain features and indeed these are the areas where we do see a lot of coops - banks, agriculture, housing and retail distribution. That coops tend to make more stable and long-term decision, perhaps than even necessary, is very cool&good in these cases and less so in others.
I think the point is pretty solid here that there's more to it than just access to finance.

Given that, a possible policy action would be of course to subsidize coops, being aware that this may distort to inefficient productivity.


uncop posted:

I think that the workers would have to compromise on wage equality to attract foreign talent, and they would end up doing it for the sake of their own job security. If they're a truly special person, they would be reasoned to be in a job category of their own, vital enough to deserve greater salary. And really, when talking about regular experts rather than pampered CEOs, their salary expectations aren't unsustainably huge. 200k compared to 20k is just 10x difference. I don't think they could compete in the international CEO market though, for better or worse. They would have to use other avenues of finding "leads and customers".

I think that cooperatives are well suited for business that do not need a wide variety of experts. But in technical or high tech companies the distribution of talent is very uneven. You'd find that if there is competition in the labor market, results would be very uneven and especially so for less educated workers. I don't think free choice of employment is a valid option in that case, nor is free choice of compensation. We are basically back at central planning for wages and telling people what to learn and where to work, which by the way was a terrible and dehumanizing system in the GDR that I would fight against to the death before I see it again.


uncop posted:

We have to remember that money is not the most important motivation for most people to do their work well. The soviet communist system of employment was equivalent to mediocre capitalist companies' system of employment, meaning that aside from lack of monetary motivation, there was also a lack of any other kind of motivation to work hard. I would actually look at how modern low hierarchy capitalist companies motivate their employees. There are a lot of methods that workers will find acceptable, given that in low hierarchy companies most ideas are provided by the workers themselves. Also, salaries that include a performance based part tend to be found equitable as long as the base salary is large enough not to be stressful. Psychologically people tend to like rewards for winning and hate punishment for losing, and socialism's concern is not punishing the losers rather than not rewarding the winners.

Monetary transfers make things simple, but the theory of incentives is not limited to money. We can, and do, build the whole deal on a lot more general platform with social compensation, preferences for security, preferences for altruism, preferences for status and prestige and so forth. It's just insanely more complicated to find a fair and acceptable compensation scheme (making central planning even more impossible of a task). Monetary transfers are really convenient for technique, but the principle deals entirely with choice sets of whatever.

To be honest, providing incentives for performance in a structured fashion will be a basic problem to solve in every society as long as people actually want things in a structured manner (and if not, it just doesn't matter what we do anyway). Anytime you do not properly motivate your workers, all you are doing is throwing away productivity and social welfare you could have had by using a better scheme.

I am not an expert in management science, but I am aware that they do not restrict themselves to money and I think the move towards incentivizing non-monetary things is very natural in light of the decision theory behind it. That doesn't mean though that monetary transfers are not insanely important. Where I live, there are a lot of start-ups failing because they think they can rely (for the wrong reasons of course) on non-monetary incentives instead of providing very good monetary incentives as well.
In any case, the issue is the same.

quote:

About relying on worker votes, it's been noticed that people vote for their employment to be as secure as possible, so the aggregate tends to vote in favor of company stability and success. That is, as long as the company is sure to guarantee new jobs for workers that its decisions displace, because otherwise people are likely to vote for stagnancy, which would cause instability. That guarantee might be a core motivation for Mondragon to have grown so huge, since obviously the profit motive doesn't really explain it.

Well if there is a vote for both stability AND success, I don't think there is a huge conflict of interest. On other hand if there conflicts of interests, such as closing one department over another, there is no reason to assume that a vote would chose the better option insofar it exists. Each non-defective voting system can be manipulated (Gibbard–Satterthwaite) so in the end these kind of decision would have to be made by someone uninvolved like a manager or the state.
That doesn't imply that coops do not have advantages in a world where profit orientation of external investors equally crushes incentives for socially welfare maximizing management decisions, aka "the world we live in"

Haramstufe Rot fucked around with this message at 13:47 on Feb 26, 2017

poopinmymouth
Mar 2, 2005

PROUD 2 B AMERICAN (these colors don't run)

caps on caps on caps posted:

elementary level questions easily answerable on google and already answered in this thread

I like how all your questions ignore that the exact same problems you are worried about already exist in capitalism right now

Orange Devil
Oct 1, 2010

Wullie's reign cannae smother the flames o' equality!

poopinmymouth posted:

I like how all your questions ignore that the exact same problems you are worried about already exist in capitalism right now

Ah but you see capitalism is just the natural order of things. It's how capitalist Egypt build the pyramids 4500 years ago.

Crowsbeak
Oct 9, 2012

by Azathoth
Lipstick Apathy
Remember everyone caps on caps on caps has suggested that Workers in first world companies should have to lsoe their jobs and see them moved to unsafe sweatshops that pay .50 $ a day because apparently that is moral.

Haramstufe Rot
Jun 24, 2016

Crowsbeak posted:

Remember everyone caps on caps on caps has suggested that Workers in first world companies should have to lsoe their jobs and see them moved to unsafe sweatshops that pay .50 $ a day because apparently that is moral.

I said that reduction of absolute poverty from 85% worldwide to less than 30% worldwide is a huge achievement but thanks I forgot to discount brown people's value sufficiently I guess?

SSJ_naruto_2003
Oct 12, 2012



You said that less inequality wasn't good so I think you're actually just saying random poo poo to get people to argue with you.

Helsing
Aug 23, 2003

DON'T POST IN THE ELECTION THREAD UNLESS YOU :love::love::love: JOE BIDEN
This is an awful lot of work to put into arguing somebody whose opening salvo was the bizarre statement that "socialism is not a theoretical framework".

Doc Hawkins
Jun 15, 2010

Dashing? But I'm not even moving!


Helsing posted:

This is an awful lot of work to put into arguing somebody whose opening salvo was the bizarre statement that "socialism is not a theoretical framework".

Really gives a sense of what an econ degree gets you nowadays, here in our enlightened era at the end of history.

Crowsbeak
Oct 9, 2012

by Azathoth
Lipstick Apathy

caps on caps on caps posted:

I said that reduction of absolute poverty from 85% worldwide to less than 30% worldwide is a huge achievement but thanks I forgot to discount brown people's value sufficiently I guess?

I will gladly do that because I care more for my fellow Americans. I could give one poo poo about someone in Bangaldesh. Also if someone were to come to power and promised that liberals who want Americans to suffer because a bangaldeshi deserves their job would dissapear. I would vote for them in a heartbeat.

mila kunis
Jun 10, 2011
Been catching up with this thread and liberals justifying themselves out of concern for the plight of third world workers is really heartwarming :) When do we get to see the great liberal fight for better working conditions, safety standards, collective bargaining and pay for said workers with the same vigor that they've pursued investor rights and privatization?

Paolomania
Apr 26, 2006

In some bizarro universe out there starting 40 years ago we exported labor protections alongside all that liberalism as a condition to enter trade deals and get access to our markets. But here in earth666 the ruling class used those trade deals to break the back of domestic labor and sell the worker credit to replace income growth.

Rime
Nov 2, 2011

by Games Forum
And yet killing off vast swathes of the rich is not viewed as a viable solution to this reprehensible state of affairs. :shrug:

9-Volt Assault
Jan 27, 2007

Beter twee tetten in de hand dan tien op de vlucht.
Killing the rich is immoral, indirectly killing poor people by removing healthcare or putting them in prison or poisoning the water supply is just how nature works. It's exactly the same as a lion killing a deer, like Darwin said. Nothing political about that.

Orange Devil
Oct 1, 2010

Wullie's reign cannae smother the flames o' equality!
When you think about it, if poor people are letting themselves get killed without even fighting back don't they deserve it? Turns out it's a just world after all!

Haramstufe Rot
Jun 24, 2016

SSJ_naruto_2003 posted:

You said that less inequality wasn't good so I think you're actually just saying random poo poo to get people to argue with you.

nah I did not, indeed on this very page I said something else entirely, but thanks for projecting bullshit

Crowsbeak posted:

I will gladly do that because I care more for my fellow Americans. I could give one poo poo about someone in Bangaldesh. Also if someone were to come to power and promised that liberals who want Americans to suffer because a bangaldeshi deserves their job would dissapear. I would vote for them in a heartbeat.

tekz posted:

Been catching up with this thread and liberals justifying themselves out of concern for the plight of third world workers is really heartwarming :) When do we get to see the great liberal fight for better working conditions, safety standards, collective bargaining and pay for said workers with the same vigor that they've pursued investor rights and privatization?

Well apparently we can not, because Americans are who matter.

Helsing posted:

This is an awful lot of work to put into arguing somebody whose opening salvo was the bizarre statement that "socialism is not a theoretical framework".

Well after arguing about it two pages, it seems pretty obvious that socialism is not a theoretical framework? Apparently the only possibly working plan you guys have is a planned economy, with market socialism being not viable. But that's something we can technically not do in a way that is not terrible.
So there's no workable plan, only wishful thinking.

And really, that was my impression. Sure, my statement is a bit irksome to stir up discussion, it's D&D after all. But if my statement was incorrect, someone would have come out immediately and said: "you are wrong, here is a link to a paper detailing exactly an analysis of our proposed allocation/distribution mechanisms in a socialist system".
Because if that plan exists, what could be easier than just post the source to show me wrong.

But all that happens is attacks, projecting opinions I don't even have and shuffling about how I am somehow wrong but we can't say how.
And that's why it is a religion and not an actual theoretical framework. Hell, the only actual sources posted were loving Piketty and some popular "science" books. Even I could do better and post some some Marxian econ articles even if they aren't exactly very good.


9-Volt Assault posted:

Wrap it up. Nothing but unfettered capitalism is possible in a way that is not terrible.

There's like this really big elephant in the room that one might actually do a more social social market economy if people actually wanted to and if people actually voted, but that goes completely above your head so that full communism now is somehow the more likely thing people will vote for in your mind, even though no one can even propose a workable framework to how that might look. And then you wonder why everything is terrible, rich people laugh in your face and your parties are getting like 2% of the votes.
cool, you are doing your job well

Haramstufe Rot fucked around with this message at 09:02 on Feb 27, 2017

9-Volt Assault
Jan 27, 2007

Beter twee tetten in de hand dan tien op de vlucht.

caps on caps on caps posted:

Well after arguing about it two pages, it seems pretty obvious that socialism is not a theoretical framework? Apparently the only possibly working plan you guys have is a planned economy, with market socialism being not viable. But that's something we can technically not do in a way that is not terrible.
So there's no workable plan.

Wrap it up. Nothing but unfettered capitalism is possible in a way that is not terrible.

Orange Devil
Oct 1, 2010

Wullie's reign cannae smother the flames o' equality!
Remember when Great Britain and the United States lost WW2 because they ran a planned economy?

Doc Hawkins
Jun 15, 2010

Dashing? But I'm not even moving!


Orange Devil posted:

Remember when Great Britain and the United States lost WW2 because they ran a planned economy?

I hear it was the road to serfdom.

Ratoslov
Feb 15, 2012

Now prepare yourselves! You're the guests of honor at the Greatest Kung Fu Cannibal BBQ Ever!

Orange Devil posted:

Remember when Great Britain and the United States lost WW2 because they ran a planned economy?

Remember when every corporation ever went bankrupt because they ran a planned economy?

9-Volt Assault
Jan 27, 2007

Beter twee tetten in de hand dan tien op de vlucht.
I dont get why we still have democracy, how can you allocate resources when you have to work with things like voting??? Corporation are run as a dictatorship and corporations are the best at everything, so clearly we need to remove democracy and replace it with a dictatorship. All hail our god-emperor Trump.

Ardennes
May 12, 2002
If anything if you want to talk about central planning, why not cut to the chase and talk about the Soviet Union itself and its successes (and yes there were ones) and failures?

Dead Cosmonaut
Nov 14, 2015

by FactsAreUseless
Had any of the optimization theory the Soviets painstakingly developed been applied through computing, the Soviet Union would have fixed a good deal of its problems.

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Ardennes
May 12, 2002

Dead Cosmonaut posted:

Had any of the optimization theory the Soviets painstakingly developed been applied through computing, the Soviet Union would have fixed a good deal of its problems.

It might have fixed some of them, but there were always intrinsic limits to central planning despite some useful benefits. One issue, as I mentioned a dozen times, are inflexible price controls which really couldn't be solved by computing. Other issue was simply selection, for example women's dresses.

Computing might more accurately tell where/when you need inputs, but it won't help you if you don't have any way to address supply in the first place. The Soviets weren't in the dark that there were massive supply issues and quotas weren't fixing them, but at the same time they didn't want to raise prices to address this.

On the other hand, let's not pretend the Soviet Union was a "flash in the pan" or didn't accomplish anything. How else did a battered agricultural society become a superpower in little more than generation?

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