How does capitalism really work?

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I had a conversation with some people who are... less than sympathetic about the state of America as it pertains to minorities and immigrants (read=don't like Blacks and Mexicans)

I tried to explain to them that Capitalism, even in the distorted way it is implemented in America, requires "losers" who make up the serving class of the society, and that it is incumbent upon the ruling class to maintain the stability of that servile class or we end up with the Bolshevik revolution or any other major revolution of a great society due to the mistreatment of its poor (read= pretty much every great civilization ever)

Am i wrong.

Inb4 all the occupiers who will come and say "It's all about big corporations who want to take over the world, be our overlords and rule the galaxy from a dimly lit conference room wallpapered in bank notes."

I'm not entirely sure what the question is.

How Capitalism works is an incredibly complex issue with no real answer that isn't contained in a 2000 page thesis. Are you correct in saying that capitalism, by nature, requires some people to be on the bottom so that some people can live the good life? Yes, you are, at least in capitalism in it's purest form. Is it the requirement of the highest class (Not the ruling class, no such thing technically exixts but I can see the argument there) to uphold a certain standard of living for the lower class? No, that would be the government's job, but I guess the popularity of the GOP and the wide rejection of Universal Health care in the US seem to indicate otherwise.

Capitilism worked when the vendor was also the supplier and the money stayed roughly in the same area. Now our system is far to complicated and diluted for the federal government not to put its foot down throughout the economy. Can we just meet in the middle of socialism and capitalism?

What exactly do you mean when you say capitalism? There's no point to a discussion unless everyone is using the same terms, and "capitalism" means completely different things depending on what your political alignment is.

I would say there has never been a completely capitalist system, just as there has never been a completely communist one, and that all governments fall somewhere on the spectrum between the two.

I'd also argue that although government intervention is necessary in some cases, it is necessary to have a market system in place to incentivise people to produce, and to have price signals that can make decisions that no human ever could. Do you disagree with that, or would you say that isn't capitalism?

It needs some degree of intervention from the government as it does not take into account social factors. With good government intervention it is the best system we have.

The problem in the US is not so much capitalism as much as the Republican belief in trickle down economics. No legitimate economist actually endorses it and no where else in the world is it accepted as a sound economic theory.

Capitalism is the function by which civilization was built on, as seen when the Phonecian traders, set sale from the dinky City of Tyre, around the coast of Modern day Lebanon... and colonized the whole fucking Mediterranean. What for?
PROFIT!

It is the most natural mechanics we humans possess for development of wealth, Capitalism combined with Taxes.

Capitalism cannot be beaten as a function but if left to its own devices will work against the good of society and for the benefit of the individual...

Capitalism and Taxes as a means of first to gain wealth, and secondly to redistribute it, a tad more fairly. Sure, reward those who earn the wealth more than others, but don't let the "winner take all" as thats just fucking moronic. If we let that happen then we may as well let a dictator rise, all take off our shoes and start shoveling shit up like back in the dark ages...

feeqmatic:

I tried to explain to them that Capitalism, even in the distorted way it is implemented in America, requires "losers" who make up the serving class of the society, and that it is incumbent upon the ruling class to maintain the stability of that servile class or we end up with the Bolshevik revolution or any other major revolution of a great society due to the mistreatment of its poor

It may have been under feudalism that a servants children would be servants, and a nobles kids would be nobles, but the class structure under modern capitalism(at least in 1st world nations) is less rigid than feudalism or even communism(being defined as observed communism, not ideal communism which has never existed on a national scale)Some of those who were poor two generations ago are in a higher economic class today. So if the early 20th century socialists who bemoaned the poverty of their time could see the progress of those eastern European immigrants descendants today I think they'd be astonished.

Many leftist intellectuals preach about economic equality but I think secretly want to be the new ruling class which will exist in the name of serving the poor masses. Thus under communism it isn't a surprise to see the existence of a class system. The difference between the capitalist elite and the communist party elite, is that the capitalists invested their wealth wisely to create more wealth(which improved technology and the standard of living), while the communists rallied around a "glorious leader" who appointed his favorite intellectual cronies to managerial positions.

JRslinger:
The difference between the capitalist elite and the communist party elite, is that the capitalists invested their wealth wisely to create more wealth(which improved technology and the standard of living), while the communists rallied around a "glorious leader" who appointed his favorite intellectual cronies to managerial positions.

I was more or less with you up until this point.

I really don't think that anything the people in charge of the major banks of the UK, US, and Iceland did in the last decade would qualify as "wise". The way I see it, the elite in any system only have one main goal; to stay elite. One very effective method for staying elite is to increase the quality of life for everyone. The problem with that is that it's quite hard to do, so they cut corners and tell everyone that what they propose will increase quality of life. The major difference between the system is how they go about that and the extent they do so, rather than one being benevolent and the other corrupt.

JRslinger:
The difference between the capitalist elite and the communist party elite, is that the capitalists invested their wealth wisely to create more wealth(which improved technology and the standard of living), while the communists rallied around a "glorious leader" who appointed his favorite intellectual cronies to managerial positions.

Only that the bubble burst, so I don't see how "investing wealth to create wealth" is "wise", considering "wealth" isn't worth anything on its own. "Wealth" is simply a number that tells how much goods and commodities you can afford, and goods and commodities are finite.

So no, I don't think it's wise at all to go, as capitalism did in the last decades, for growth at any cost.

Hindsight is a mistress harsher than gravity sometimes.

MoNKeyYy:
I'm not entirely sure what the question is.

How Capitalism works is an incredibly complex issue with no real answer that isn't contained in a 2000 page thesis. Are you correct in saying that capitalism, by nature, requires some people to be on the bottom so that some people can live the good life? Yes, you are, at least in capitalism in it's purest form. Is it the requirement of the highest class (Not the ruling class, no such thing technically exixts but I can see the argument there) to uphold a certain standard of living for the lower class? No, that would be the government's job, and apparently the popularity of the GOP and the unpopularity of Universal Health Care in the US seem good enough indicaters of that.

So are you saying that the govt is not doing its job to maintain social welfare, or are the people so caught up in the rhetoric of the Right that they are rejecting it on their own?

Vegosiux:

JRslinger:
The difference between the capitalist elite and the communist party elite, is that the capitalists invested their wealth wisely to create more wealth(which improved technology and the standard of living), while the communists rallied around a "glorious leader" who appointed his favorite intellectual cronies to managerial positions.

Only that the bubble burst, so I don't see how "investing wealth to create wealth" is "wise", considering "wealth" isn't worth anything on its own. "Wealth" is simply a number that tells how much goods and commodities you can afford, and goods and commodities are finite.

So no, I don't think it's wise at all to go, as capitalism did in the last decades, for growth at any cost.

Hindsight is a mistress harsher than gravity sometimes.

True that not every investment made is wise, but over the past century more wealth was created and the standard of living rose faster in the Western capitalist nations than it did in the USSR. Capitalism allows a greater reward for innovation, which often has a benefit to society in general even if the innovation causes some jobs to be lost in the short term.

feeqmatic:

So are you saying that the govt is not doing its job to maintain social welfare, or are the people so caught up in the rhetoric of the Right that they are rejecting it on their own?

I have no idea where I was going witht the last sentence of that post, I'm sorry I haven't slept much. I think I had a point but forgot to type it. I just fixed it.

I live in Canada, so I think the government is doing a decent job maintaining social welfare but it could still be better. Actually, the bit about right wing rhetoric is accurate too. So I guess I was trying to say both?

JRslinger:

feeqmatic:

I tried to explain to them that Capitalism, even in the distorted way it is implemented in America, requires "losers" who make up the serving class of the society, and that it is incumbent upon the ruling class to maintain the stability of that servile class or we end up with the Bolshevik revolution or any other major revolution of a great society due to the mistreatment of its poor

It may have been under feudalism that a servants children would be servants, and a nobles kids would be nobles, but the class structure under modern capitalism(at least in 1st world nations) is less rigid than feudalism or even communism(being defined as observed communism, not ideal communism which has never existed on a national scale)Some of those who were poor two generations ago are in a higher economic class today. So if the early 20th century socialists who bemoaned the poverty of their time could see the progress of those eastern European immigrants descendants today I think they'd be astonished.

Many leftist intellectuals preach about economic equality but I think secretly want to be the new ruling class which will exist in the name of serving the poor masses. Thus under communism it isn't a surprise to see the existence of a class system. The difference between the capitalist elite and the communist party elite, is that the capitalists invested their wealth wisely to create more wealth(which improved technology and the standard of living), while the communists rallied around a "glorious leader" who appointed his favorite intellectual cronies to managerial positions.

I had a less racist person explain to me that what we have in America today is not really capitalism but a plutocracy. Social welfare has been replaced with corporate welfare, hence the whole occupy movement. i have to say that this seems like it is definitely the case.

What i feel like i am seeing now is an simmering frustration with the status quo that could turn ugly.

When working properly, it's about hard work leading to adequate results. You're supposed to have equality of chances but not equality of outcomes. Of course, neither is true in the current system in America in particular, but other capitalist systems like Germany aren't truly equal in chances, either, although they might be closer to it. The problem is that unfettered capitalism leads to a widening gap of rich and poor as the elite closes off paths for the lower classes to advance as is their due according to the amount of work they invest. Thing is, capitalism can't regulate itself, that is where I fundamentally disagree with Libertarians and economic liberals. You need referees, basically.

feeqmatic:

I had a less racist person explain to me that what we have in America today is not really capitalism but a plutocracy. Social welfare has been replaced with corporate welfare, hence the whole occupy movement. i have to say that this seems like it is definitely the case.

I know there is corporate welfare, but I wouldn't dismiss social welfare given that there's a record number of people on food stamps.
http://money.cnn.com/2011/04/12/news/economy/government_safety_net/index.htm

The only area where government support is really needed is farming, otherwise I fear we'll become too dependent on foreign food if domestic production drops.

feeqmatic:

What i feel like i am seeing now is an simmering frustration with the status quo that could turn ugly.

Is this frustration caused by the bad economy or is it some deeper seated hatred/jealousy of the rich that I don't share?

If the government continues excessive borrowing then it will reach a point where it is unable to borrow enough to meet its spending obligations. When the government reaches that point social spending will necessarily take a huge hit. Then I expect there will be rioting.

MoNKeyYy:
How Capitalism works is an incredibly complex issue with no real answer that isn't contained in a 2000 page thesis.

O_o

Really?

Capitalism:
image

You use capital, to supply demand in order to gain profit.

----------------------

The problem is that, that is the basic version. The free market version, the one that works the best.
Truth is that Free markets do not exist and Companies use their power to tip the scales in their favor to squeeze more money out that should be normal. This is both market power and Political power (bribery). Also capitalism and Corporate abuse of it leads to more profit, decreased worker pay, and decreased workers. Normally not a problem... but when it crashes it is.

Its very true you can add 2,000 and more pages on top of that but Capitalism is that graph. Free will, let the people decide what they want to buy and how much for.

Comando96:
The problem is that, that is the basic version. The free market version, the one that works the best.

Eh, I dunno. A "true free market" is basically what we had in the US in the late 19th century during the industrial revolution, and at that time monopolies and political corruption were at all time highs. The government HAD to step in in order to keep things from getting more out of control, outlawing monopolies and trusts so they couldn't quite as easily take over a small town and overcharge for their services til they sucked it dry. And to keep one company from controlling the entire market. Railroads were especially bad for this, and oil coming in second with Rockefeller.

Also, I keep hearing this "bribery and paying off politicians" argument but very little proof ever gets brought in. I understand it's something that's inherently difficult to prove, but that sort of terminology sets off my tinfoil hat alarm and makes me take the "problem" a lot less seriously.

Lilani:

Also, I keep hearing this "bribery and paying off politicians" argument but very little proof ever gets brought in. I understand it's something that's inherently difficult to prove, but that sort of terminology sets off my tinfoil hat alarm and makes me take the "problem" a lot less seriously.

It's more of a big picture thing. Remember Glass-Steagal being repealed? Or the big bail-out? That was the politicians paying back their banker friends. It's not like bank X is sending secret dollar-sign bags to Senator Y. The bribery is open, legal, and aboveboard.

Veylon:

Lilani:

Also, I keep hearing this "bribery and paying off politicians" argument but very little proof ever gets brought in. I understand it's something that's inherently difficult to prove, but that sort of terminology sets off my tinfoil hat alarm and makes me take the "problem" a lot less seriously.

It's more of a big picture thing. Remember Glass-Steagal being repealed? Or the big bail-out? That was the politicians paying back their banker friends. It's not like bank X is sending secret dollar-sign bags to Senator Y. The bribery is open, legal, and aboveboard.

That's purely based on speculation--and demonizing speculation at that. I just saw that as another insipid attempt at trickle-down economics. Sure it was irresponsible, idiotic, and couldn't have been pulled off any worse, but a conspiracy? Again, break out the tinfoil hats. Show me the documentation that shows the banks or any known affiliates giving contributions to the politicians, and show me how that correlates with who did and didn't vote for and advocate the bailouts and then we'll talk.

It's all about big corporations who want to take over the world, be our overlords and rule the galaxy from a dimly lit conference room wallpapered in bank notes.

Lilani:

Veylon:
snip

That's purely based on speculation--and demonizing speculation at that. I just saw that as another insipid attempt at trickle-down economics. Sure it was irresponsible, idiotic, and couldn't have been pulled off any worse, but a conspiracy? Again, break out the tinfoil hats. Show me the documentation that shows the banks or any known affiliates giving contributions to the politicians, and show me how that correlates with who did and didn't vote for and advocate the bailouts and then we'll talk.

It's not a conspiracy. The "bribery" doesn't consist of campaign contributions - not entirely. But have a look at the Tom Delay Investigation. Here we have ARMPAC injecting $190,000, much of it from unknown donars, into the RNC. The main reward for toeing the line is lucrative consulting jobs after political "retirement". That's where Newt Gingrich has been. Bob Dole? Multiply corporate spokesman.

"Bribery" may actually be the wrong word here. Corporations (and, to be fair, labor unions and other groups) don't throw money around in the hopes of changing political minds. They do so in hopes of raising people who already agree with them to positions of power.

Now, there is a site - I don't vouch for it, it may well be the tin-foil type - that claims to have the numbers on this. Here's the link: http://maplight.org/financial-bailout-vote-house

And, honestly, I'm not the tin-foil type myself. I don't believe in any all-powerful conspiracy or that corporations are especially evil. They are doing what every group does in this world of ours: fending for themselves. The danger isn't in smoke-filled secret meeting rooms, but in a populace eager to embrace Randian ideals.

Zekksta:
It's all about big corporations who want to take over the world, be our overlords and rule the galaxy from a dimly lit conference room wallpapered in bank notes.

Ahahaha~

image

Comando96:

MoNKeyYy:
How Capitalism works is an incredibly complex issue with no real answer that isn't contained in a 2000 page thesis.

O_o

Really?

Capitalism:
image

You use capital, to supply demand in order to gain profit.

----------------------

The problem is that, that is the basic version. The free market version, the one that works the best.
Truth is that Free markets do not exist and Companies use their power to tip the scales in their favor to squeeze more money out that should be normal. This is both market power and Political power (bribery). Also capitalism and Corporate abuse of it leads to more profit, decreased worker pay, and decreased workers. Normally not a problem... but when it crashes it is.

Its very true you can add 2,000 and more pages on top of that but Capitalism is that graph. Free will, let the people decide what they want to buy and how much for.

This. Except I would like to say that free markets do exist, but only on a very small scale due to corporatism. Corporatism has controlled both the governments and the markets for so long, that only very small free markets remain. Free markets are awesome, but have no hope to grow with the world in it's current state. Small free markets allow for people true freedom to do as they wish with their lives, have control over their own futures and allows for small communities to flourish, however, they are being crushed in this time by the corporations that control the laws, currencies and global markets.

And there's the greater social question here. On one hand, most people find it generally desirable for people in society to be equally wealthy, or as close to it as possible. On the other hand, there's the concept of the leaky bucket. In transferring wealth from the rich to the poor, it is inevitable that some of the wealth disappears. In the most extreme, the only way of making everyone completely equal that has been achieved so far is by making it so that EVERYONE is living in utter poverty.

How much redistribution is justified? It's a subjective question, and the answer depends on what your personal philosophy is. There's no real right or wrong, just what people think that society should look like.

Pingieking:
I really don't think that anything the people in charge of the major banks of the UK, US, and Iceland did in the last decade would qualify as "wise". The way I see it, the elite in any system only have one main goal; to stay elite. One very effective method for staying elite is to increase the quality of life for everyone. The problem with that is that it's quite hard to do, so they cut corners and tell everyone that what they propose will increase quality of life. The major difference between the system is how they go about that and the extent they do so, rather than one being benevolent and the other corrupt.

2 decades, and at the insistence of government pressure. At least in the case of the US, if Fannie and Freddie had not encouraged Countrywide to start pushing really bad paper, the other banks never would have followed suit(threat of lawsuit for "discrimination" over loan terms is a great motivator). If they had never issued the initial horrible paper, they never would have looked for a mechanism to alleviate the strain, in this case credit default swaps. If CDS's had never become such a large area of the market, some idiot with a limited understanding of computers would never had come up with a GIGO computer model showing CDS's allowed the banks to figuratively print money. If the computer model had never been published, the sub prime loans would never had expanded into all strata of the housing market. Without that expansion the housing bubble would not have super inflated and popped like it did. So the moral of the story is the government needs to quit fucking around with markets to try and force a "desirable outcome" which in this case was single family housing for everybody.

Veylon:

Lilani:

Also, I keep hearing this "bribery and paying off politicians" argument but very little proof ever gets brought in. I understand it's something that's inherently difficult to prove, but that sort of terminology sets off my tinfoil hat alarm and makes me take the "problem" a lot less seriously.

It's more of a big picture thing. Remember Glass-Steagal being repealed? Or the big bail-out? That was the politicians paying back their banker friends. It's not like bank X is sending secret dollar-sign bags to Senator Y. The bribery is open, legal, and aboveboard.

Please explain EXACTLY how Glass-Steagal would have prevented the housing bubble. I'm going to assume that you mean the highly modified 90's version of Glass-Steagal and not earlier versions. Somehow I doubt you want to bring back Regulation Q. But anyway, lay out exactly how it would have stopped the housing bubble and subsequent bailout.

Note, given that all the banks which really NEEDED the bailout were the pure investment banks and not the mixed banks, saying that G-S would have kept mixed banks from existing is not an argument for stopping the bubble or subsequent crash.

Really, the argument that Glass-Steagal would have stopped anything has the decided whiff of Underpants Gnomes.

Lilani:
Eh, I dunno. A "true free market" is basically what we had in the US in the late 19th century during the industrial revolution, and at that time monopolies and political corruption were at all time highs. The government HAD to step in in order to keep things from getting more out of control, outlawing monopolies and trusts so they couldn't quite as easily take over a small town and overcharge for their services til they sucked it dry. And to keep one company from controlling the entire market. Railroads were especially bad for this, and oil coming in second with Rockefeller.

Also, I keep hearing this "bribery and paying off politicians" argument but very little proof ever gets brought in. I understand it's something that's inherently difficult to prove, but that sort of terminology sets off my tinfoil hat alarm and makes me take the "problem" a lot less seriously.

No... Sorry but I think I've created a bit of confusion because I used the economic specific term. You have used the term Free Markets... as in unregulated, or "Free" being a historians term for a period... but not the economic one.

A Free Market is a specific term in economics, to refer to a market that is comprised so that no single or a group of suppliers or demanders can use their weight to influence the market.

The period you just described is not a free market as they "derp were derp abusing derp their derp power derp" to influence the market in their favor.

Make no mistake of it, free markets are the ultimate thing to aim for (excluding positive externality goods).

Free markets however exist sparsely. I'll be explaining that in my next reply.

Lil devils x:
This. Except I would like to say that free markets do exist, but only on a very small scale due to corporatism. Corporatism has controlled both the governments and the markets for so long, that only very small free markets remain. Free markets are awesome, but have no hope to grow with the world in it's current state. Small free markets allow for people true freedom to do as they wish with their lives, have control over their own futures and allows for small communities to flourish, however, they are being crushed in this time by the corporations that control the laws, currencies and global markets.

Well there is still 1 market which is still totally free of corporate influence and simply, on the contrary, not too small but too big.
Global Currency Exchange Markets! The buying and selling of other countries currency is simply too big for any one company to control on a large scale and simply need to employ a group of specialist traders to do it for them but operate on their own as its the only way trading is possible. I should know, I have started doing it from home since I turned 18, 8 days ago :)

The other market used to be food, but sadly with the rise of protection syndicates the free market for food has been being tampered with on and off for 30 years, but most of the time it is a free market.

There are inevitably small free markets in existence but in economics these are classed as "exceptions" :P For for 'em an those who use 'em.

feeqmatic:
Am i wrong.

It is not so much that the capitalist mode "requires" poor persons, as much as that they are an inevitable consequence of the way it is organised. Capitalism hinges upon the protection private property, the power to claim exclusive rights to objects, locales and ideas. Because of a mechanism called primitive accumulation the wealthy have a tendency to end up wealthier, as they have more means to stave off poverty, leading to an eventual situation where you have the few wealthy, and the many poor. There are many attempts to thwart primitive accumulation, but seeing as the wealthy have a lot of power to influence and corrupt those systems (such as progressive taxation), there is no powerful counterforce short of the worker's refusal to continue supporting the status quo.

Comando96:
A Free Market is a specific term in economics, to refer to a market that is comprised so that no single or a group of suppliers or demanders can use their weight to influence the market.

The period you just described is not a free market as they "derp were derp abusing derp their derp power derp" to influence the market in their favor.

Make no mistake of it, free markets are the ultimate thing to aim for (excluding positive externality goods).

As a point of interest; do you think that the powerful will ever *not* use their power to influence markets to their interests? Do you think they even have a real choice whether or not to do so? Markets bring the most ruthless to power, and trusting that others won't use their power is not something capitalists have been wont to do.

Also:

yes for the modern capitalist system to function you need both "the poor" and "the unemployed" to exist. however both groups are fluid and in a moral society recognition should be given to both the fluidity and the requirement for their existence and so governmental support should exist so that poverty does not equal destitution. people should move through both groups as they churn (so the most important figures are actually in relation to "social mobility")

the idea that the system has always existed because buying and selling for profit has always existed is flawed. the modern system was formulated at a specific time with specific societal aims which was basically the prevention of the inevitable conclusion of the total free regain of human greed (or for want of a better term "plutocratic feudalism")

modern "Capitalism" was created and institutionalized for a reason.
a reason most modern advocates have seemingly since forgot.
it was supposed to empower the mercantile and working classes.

it was never meant to run without checks and balances and was never supposed to place societal power (back) in the hands of "the super rich". indeed that was one of the main things it was supposed to work against by encouraging the rich to invest capital in business ventures in search of further profit (harnessing their "greed") which would pay far more peoples wages (which they sought in turn through their own "greed") thereby shifting political power and wealth from the top to the middle even when a business ventured failed.

opposed to what you might ask ? as opposed to the rich & powerful just simply taking it and then basically sitting on it ala hundreds of years of history where the rich ruled via simply by being obscenely rich compared with everyone else and the only form of large scale further wealth acquisition was basically war.

the complete antithesis to the system as its supposed to work is hugely rich people sitting on a huge pot of wealth as existed in Feudal Europe complete with the serfs being virtually owned for all intents and purposes and their lives being completely governed and dictated by the requirements of their feudal "lords"...sound familiar ?...oh yes, something has gone badly wrong with "Capitalism" but its not the the fault of "Capitalism" per say because "Capitalism" started out knowing fine fine well this was the probably outcome of the free reign of human greed...seriously just go read Adam Smith: its all there...this is the fault of people who have convinced you it was something else entirely...and ofc you for believing it/being that stupid.

the big mistake some people make is assuming this is all "ok", that its alright that the system has been subverted to cause the very thing it was supposed to act against, is somehow they assume they'll come out somewhere near the top.../facepalm

Sleekit:

it was never meant to run without checks and balances and was never supposed to place societal power back in the hands of "the rich" (indeed that was one of the main things it was supposed to work against).

Oh irony, why you so silly.

You're right of course, it replaced royalty with businessmen. I'd call it an improvement, but I'm not even sure about that anymore. With a king at least you had someone to behead.

TheMatsjo:
As a point of interest; do you think that the powerful will ever *not* use their power to influence markets to their interests? Do you think they even have a real choice whether or not to do so? Markets bring the most ruthless to power, and trusting that others won't use their power is not something capitalists have been wont to do.

They won't if you hold a gun to their heads :P

The thing is the peak of competitiveness is free markets. If you regulate against corporations and prevent them getting too big then they cannot possibly effect anything.
You ask if they have a choice and you are right there, no they do not. No one does... but thats only as a means to counter-act someone else's abuses. If you were to stop Apple suing Samsung then there would be no need for Samsung to sue Apple.

If you make it so no one else is allowed to then the playing field is equal. Business acumen and creativity alone will determine the market leader. It would be whoever did the best thing for the lowest price in that particular niche in that market.

Everyone wins, except super billionaires who find their empire broken down into a lot more effective and productive chunks giving out more money to a wider range of people rather than concentrating it.

Free markets would be a means to lower... quite drastically lower inequality... if only the big corporations didn't have bribes already set up already prepared to stop any attempt at this >.>

Also Thank you, I love those TED video's :D

Corporations would seem to be the primary problem. Corporations exist because of investors. To get investors they need to make more profit. To profit they need to get more investors. If some other corporation is making better profits then investors will invest there instead. It makes the normal competition in a capitalist system double edged, competition in the marketplace and competition on the stock market. This creates a situation where common workers are not nearly as valuable as the people who are (allegedly) capable of working the balancing act between the two markets of competition, upper management and CEOs.

In basic capitalism there is no necessity to continue making bigger and bigger profits. One only needs what one needs to survive and anything more is gravy, that is the way most privately owned companies work. Corporations need to continue to make bigger and bigger profits, or at least attempt to, just to survive.

i think we could make a decent start by removing the (insane imo) legal requirement that they try to avoid paying as much tax as possible because tbth its gotten to the stage where most major companies are "competent" enough (if you want to call it that) that they are not contributing back into the fabric of the society that sustains them via paying tax (ala GE last year and its minus $3.2 billion "bill") and as a result the entire tax burden of running and maintaining the infrastructure of an advanced society is beginning to fall solely on the shoulders of the peoples wages which the same firms will constantly attempt to lower.

simply put, that cannot be sustainable in the long term and tbth we are probably already at that point.

no one likes paying taxes. fair enough. its easy to see why. you made some money and something said "...and you give me X%...". but there has to be an understanding that some taxes have to be paid because no man or company is an island: all within any given country make use of multitudes of services and infrastructure maintained by the same taxes from something as banal as drinking water and tarmac to something as impressive as the military "keeping the country save" it all has to be paid for.

Capitalism doesn't require losers but it also makes no effort to prevent them. What it does require is the stability to trade goods and services at a profit.

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