My fear of the liberal communists...

luceafarul said:
I hope you are a light sleeper...:mad:
As you may recall, I suffer from insomnia. This has been a bad week.
My impression is, that if we bunch together all the "libertarians", randroids and those vaguely attracted to those ideologies, we get a substantial over-representation.
Regarding communists; I can only think of one poster here which I would cathegorise as such, and except for me, only one anarchist as well.
It is of course true that the majority ofpeople represent more mainstream ideologies, but I still think I find a certain discrepancy here.
Given that we probably have somewhat different views what exactly constitutes a "communist" and a "libertarian", and that we shouldn't be comparing lists by mentioning names, I don't think we can usefully pursue this subject further. But it gives me an idea for a poll ...
Sorry, but that is quite an absurd critique, since that is not the aim of the article.
It wasn't so much a critique as an observation. See below ...
And apart from the fact that it in general always important to identify a problem before you solve it, you may also want to let people have their say in how to deal with it as well, perhaps "progressives" simply has more faith in collective wisdom than "moderates", "sedates","cynics", conformists or whatever we should term the bold upholders of DA system?
I'm unfamiliar with the expression "DA system". Anyway, I was, of course, giving a general explanation why "progressive" arguments tend to fail to impress me. I apologize if that was beside the point of this thread.

However, if the point is not that progressives have a better alternative, I'm not quite sure what the point is. You refer to identifying a problem, but it's not entirely clear what problem is being identified here. It can't very well be at the system embodied by Messrs Gates and Soros is bad - that seems to be taken as a given. If it is that the "liberal communists" are no allies of the progressives, that's a concern for the progressives, and I have nothing more to say.

(I can address the part about trusting in collective wisdom if you so wish, but if convincing me of the superiority of progressivism (progressiveness? progressivehood?) isn't on the agenda, that seems rather besides the point.)
Besides, while you know virtually everything, it could benefit many others to witness a removal of the halo from around the head of mr.Gates...
Flattery will get you nowhere! :p

As an aside, my circle of acquaintances consists to a largish percentage of computer folks, so I'm more used to seeing Mr Gates presented as the Antichrist than as a saint. Needless to say, I consider him to be neither.
 
Bozo Erectus said:
I dont agree with it. Greed, as they say, is good. These two supposedly morally reprehensible rich people (Soros and Gates) employ and provide livelihoods to many thousands of people directly, and who knows how many other thousands or millions of people indirectly. I have no problem with wealth, however I do have a problem with believing wealth is a sign of inherent superiority. But thats not an economic problem, its a moral one;)
These supposedly greedy people also donate vast sums to charity. I don't claim to know what their motivations are, but if it were simple greed, one'd expect them to keep the money, would one not?
 
Unless of course it suits thier interests in the long run to give to charities. I don't think anyone could say that giving to real honest causes is a bad thing, but I feel that some of these 'new elite' could focus more of thier efforts on the causes of the problems, and in some cases, try a little charity at home first.
 
The Last Conformist said:
Since when does being greedy imply acting in one's own interest? Back in the high and far-off days of the 1980s, when I was a kid, there used to be moral tales on the TV teaching kids that greed often backfires.

Greed is by definition looking our for your own best interest. WHether or not it pans out that way has little to do with it.
 
Well, what is greed, really? It's an abstract term that one can apply at will. I can be greedy by virtue of collecting money, and I think this is typically seen as the most common form. But I can also be greedy by giving that money away in order to gain praise and affection. I can be a greedy lover or a greedy charity worker. Indeed, there is likely little I can do that someone could not call greedy in some sense or another, given that there is some sort of purpose behind it. So perhaps we should henceforth refer to "avarice" instead?
 
The Last Conformist said:
These supposedly greedy people also donate vast sums to charity. I don't claim to know what their motivations are, but if it were simple greed, one'd expect them to keep the money, would one not?
When you get to the level of a Soros or Gates, money isnt money any more, its power. Its like they start out with an addiction to money, and then move on to the harder stuff, power.
punkbass2000 said:
Well, what is greed, really? It's an abstract term that one can apply at will. I can be greedy by virtue of collecting money, and I think this is typically seen as the most common form. But I can also be greedy by giving that money away in order to gain praise and affection. I can be a greedy lover or a greedy charity worker. Indeed, there is likely little I can do that someone could not call greedy in some sense or another, given that there is some sort of purpose behind it. So perhaps we should henceforth refer to "avarice" instead?
I know greed when I see it. Greed is Michael Jordon, a retired basketball player worth probably well over $100 million, doing Hanes underwear commericals. Or a multimillionaire actress, Catherine Zeta Jones, married to an even wealthier actor, Michael Douglas, selling cellphone plans on TV. Theyre still hooked on money and havent moved on to power yet.
 
Bozo Erectus said:
When you get to the level of a Soros or Gates, money isnt money any more, its power. Its like they start out with an addiction to money, and then move on to the harder stuff, power.

I know greed when I see it. Greed is Michael Jordon, a retired basketball player worth probably well over $100 million, doing Hanes underwear commericals. Or a multimillionaire actress, Catherine Zeta Jones, married to an even wealthier actor, Michael Douglas, selling cellphone plans on TV. Theyre still hooked on money and havent moved on to power yet.

Exactly. No-one is greedy just for money, its all the nice things that come with it. Mike Jordan and Cathy Z Jones are hooked on a lifestyle, which involves both material goods and attention. I would say the same with people like Bill Gates: money brings power, but with that you need prestige. I don't really care about thier motives, I just care if thier motives are making them put thier resources in the right places. There are countless important charities that miss out on funding every year because they aren't the 'hip' thing, or don't give out enough nice champagne at the fundraisers. I just hope that when Billy G donates his money, he's thought long and hard about who to give it to.
 
In a way, you could say that since the businesses of Soros and Gates are global, and dependent on stability, their philanthropic activities are part of their overall business strategies. But I dont really care about their motivations. Giving a billion dollars to AIDs research is a good thing.
 
Atropos said:
All of these assumptions can be questioned:
Yes, but so can yours. :)
1. The word "progressive" implies movement towards the future. If the history of the past fifty years suggests anything, it suggests that the free market system is strengthening, not weakening, so the term "progressive" applied to anti-free-market ideologies is a misnomer.
This is a limited definition of "progressive politics".

Limited because it excludes the vast swathe of political opinion that exists in the world, which is simultaneously concerned with 'movement towards the future' (Free market sensibilities need not be compromised with progressive politics) AND providing an alternative to the corporate-dominated-limited-party-fake-democracy-pyramid-system that presides over the wealthiest nations in the world (and therefore the poorest ones too).

Where's the misnomer in this "progressiveness"?
2. Jericho could make the case here much better than I can, so let me just say that so-called "outsourcing" is a form of free trade. No serious economist opposes free trade in principle, and David Ricardo's work suggested two hundred years ago that it helps the poor as well as the rich.
Ricardo was wrong to a significant degree and so is this point. If you read the article in the OP once more, you will see that it says:

"By way of outsourcing, you export the (necessary) dark side—low wages, harsh labor practices, ecological pollution—to “non-smart” Third World places (or invisible places in the First World itself). The ultimate liberal communist dream is to export the working class itself to the invisible Third World sweatshops."

In what way is this not correct? This is exactly what we are doing in our post-industrial, first world economies. We are losing manufacturing in first world countries not because the third and developing world suddenly got savy and many gained independence (though that is a part). We lost it because we're exporting our management / labour relationships, in other words, our class systems and encumbent niceties to other nations. Why are we doing this? Because it makes fiscal, political and social sense to the first world's elite, not because it bestows munificence and splendour on the developing world. The same is happening with many of our service industries and both are the same strategy masquerading under the same cloak.

This is the highly crucial link between globalisation and free trade economics that you are missing. Sure it benefits the poor. But it benefits the poor in the same way as giving a piss poor job to someone whose been unemployed for ages. It helps them but it also entraps them under our aforementioned 'pyramid'. It helps them enter into an utterly unequal relationship.

Note that the term is "outsourcing". And that the word 'sourcing' is ever so fluffy and nice. But what's its reality?

Where is the decision to outsource being made from?
The first world.

By whom?
The first world's corporate elite.

Who is really benefiting the most in this unequal relationship?
The same.

What exactly is it that is being outsourced?
It's not the ownership. It's not the decision making. It's not the biggest bonus packets. It's the "low wages, harsh labor practices, ecological pollution".

Globalisation's another word that contains too much fluffiness to truly describe the truth it supposedly relates to.

Free trade need not be associated with all this.
3. I seriously doubt that the weltanschauung of, say, Bill Gates is anywhere near as developed as the article suggests. By what art has the author made a window into Gates' soul?
I really don't know which tendancy or sentiment in Mr Gates' soul you refer to but let me have my word about Gates' style.

If it's his squeeky clean halo you refer to, then simply ask yourself 'in what way is Microsoft different from other corporations that preside over the above mentioned relationship'? In what way has Microsoft shown fairness to competition, justice to its employees, respect for its customers? In short, Microsoft wears the same old boot that Gates' transparent PR warblings claims the old school wears. He also wears that cloak I mentioned too.

If it's his sudden philanthropic bent, then just insert here whatever cynical answer tickles your fancy. I'm not saying he shouldn't show philanthropy, but note that none of his gestures of late have done anything to drastically change the lanscape of global corporate culture for the better.
4. Because Windows is a quasi-monopoly, many libertarians (including myself) have very grave doubts about Bill Gates. They may support the existence of rich people, but that is quite different from supporting Gates' putative ideology. Nor do most libertarians believe that aid, in isolation from other measures, can be the primary method of reducing poverty. You can send all the medical supplies you can eat to the Congo and it will do very little good because trained nurses and doctors have fled and the warring factions seize everything valuable.
This one can't be questioned so easily :D.
 
Che Guava said:
Greed is by definition looking our for your own best interest.
That's a novel definition of "greed" to me.

But let's stop this threadjack. It's quite obviously not going to lead anywhere useful.
 
Yes, but so can yours.
Sure. That's why it's a debate.
Where's the misnomer in this "progressiveness"?
You misunderstood me. I was not saying that opposition to the free market is bad (although yes, I think it is misguided). I was saying that it is not progressive in the sense of espousing progress (i.e. the direction that the world is currently headed, for good or ill). The author used the term "progressive" in a rather lazy sense, to mean, basically, left-wing. That's not what "progressive" means.
This is the highly crucial link between globalisation and free trade economics that you are missing. Sure it benefits the poor. But it benefits the poor in the same way as giving a piss poor job to someone whose been unemployed for ages. It helps them but it also entraps them under our aforementioned 'pyramid'. It helps them enter into an utterly unequal relationship.
From the point of view of those who would starve without their piss poor jobs, the fact that they are helping to perpetuate "the system" which gives them these jobs is not really a bad thing. You are taking for granted what you wish to prove, i.e. the idea that "the system" is exploitative. The fact that it incorporates inequality is irrelevant. It is, firstly, a stopgap for those who would otherwise starve, and, secondly, a stepping stone to better things. Capitalism creates wealth better than any other system yet tried. It raised Taiwan and Korea out of poverty, and I hope and believe that it will do the same for Africa in time.
Who is really benefiting the most in this unequal relationship?
Not relevant. The question isn't: Who is benefiting most? It's: Who is benefiting? If someone gives you 50,000 and me 10,000 widgets, am I hurt by this?
Free trade need not be associated with all this.
Yes, it must. The importance of Ricardo's analysis is that he proved that specialisation of labour works the same way between as within countries. By the way, although you claim that the father of comparative advantage theory was wrong, you haven't presented any evidence to show that this is the case. Care to examine his math and show where he messed up?
his squeeky clean halo
Seriously, what person with a brain thinks that Bill Gates is a saint? My point was that the article attributes a quite elaborate socioeconomic theory to him without any data to show that he actually adheres to the listed views.
This one can't be questioned so easily .
Glad we agree on something.
 
Atropos said:
Sure. That's why it's a debate.
Touché. My lunge.

It seems I wasn't clear enough and my language was a bit blunt. Sorry about that, I'll clarify.

I'm not opposed to free trade at all, so I'm not opposed to outsourcing per se either. What I am calling into question is the nature and the equity of those labour contracts though. Again, there need not be any compromise for free trade, prosperity or human ingenuity here.
You misunderstood me. I was not saying that opposition to the free market is bad (although yes, I think it is misguided). I was saying that it is not progressive in the sense of espousing progress (i.e. the direction that the world is currently headed, for good or ill). The author used the term "progressive" in a rather lazy sense, to mean, basically, left-wing. That's not what "progressive" means.
I'm concerned with the bit I bolded because I see that there is ill being 'progressed' and 'exported' that need not be and should not be. It seems you are not concerned with this. Why not? (If it's anything to do with Ricardo, then see below).

Would you say that my version was a better definition of "progressive" than the author's? If so, is there a critique to be made of its general idea (more below)? If not, where is your disagreement with the "progressive" I put forward? I'd like to see it knocked about a bit for fitness to be honest :)
From the point of view of those who would starve without their piss poor jobs, the fact that they are helping to perpetuate "the system" which gives them these jobs is not really a bad thing. You are taking for granted what you wish to prove, i.e. the idea that "the system" is exploitative. The fact that it incorporates inequality is irrelevant. It is, firstly, a stopgap for those who would otherwise starve, and, secondly, a stepping stone to better things. Capitalism creates wealth better than any other system yet tried. It raised Taiwan and Korea out of poverty, and I hope and believe that it will do the same for Africa in time.
I'm not saying that their taking of these jobs is a bad thing. Man's gotta eat.

But I am saying that our management and owners in the first world cannot be considered "progressive" if they do not move forward towards a more equitable and socially responsible relationship. There's a clear and growing demand for such enterprises these days. (In my mind, progressive also means becoming more just, raising grinding poverty, providing humane working conditions etc)

Besides, we've had Capitalism for a long time now, in varying forms. Are you satisfied with it being quite incapable of generating that wealth in a more equitable and widespread manner? Can you see it ‘progressing’ to such a stage as that which I am hinting at here, underpinned by a strong and growing demand for more ethical and equitable labour relations?
Not relevant. The question isn't: Who is benefiting most? It's: Who is benefiting?
Yes it's entirely relevant to the whole article's thrust, which I read as saying that folk like Gates are benefiting disproportionately, and then trying to make it seem alright with transparent gestures. If you ask the question of simply: "who's benefiting" it truly masks the inequality and injustice. That's why we must compare the two and ask “who is benefiting the most?” I’m into win-win deals.
If someone gives you 50,000 and me 10,000 widgets, am I hurt by this?
I've got the same problems with your example as I have with the example Ricardo used to put forward his comparative advantage theory. Although that theory is sound within itself, it assumes the absence of many real factors, and is not entirely relevant to the issue of outsourcing here.

Your example bears little relation to reality because it does not contain any of the other costs associated in the employment contract between us. Where is the cost of training, subsistence and labour perpetuation? In short, the cost of labour and the production of more labour? Where are all the other incumbent costs? Come on. Global trade, and specifically outsourcing within that, is not about two parties just getting a lump sum.

In a slightly similar fashion, Ricardo's example (I'm thinking of the Portugal and England trading example he used), bears little reality to the specific phenomena we’re discussing here – outsourcing. Please correct me if I am wrong but didn’t Ricardo work on the subject of international trade specifically between two parties and not the usage of labour in the first world corporate arena?

Well, that’s my point about Ricardo’s work here. It’s simply not what we are talking about and that’s why I said he was ‘wrong’ here (irrelevant would have perhaps been a better word). I am talking about what goes on within one company ie. the decision made by first world corporate management elite to send the more unsavoury aspects of his enterprise to a distant land, where unions may be weaker, where work conditions are poorer, where regulations can allow for serious lapses of justice in the management / labour relationship. It’s only partly about international trade, but the focus of my lens is on the specific strategic decision within that company to outsource.

Those aspects, upon being outsourced, are downgraded in terms of social and environmental responsibility. The apparent, undeniable, yet limited benefit for the developing world subcontractor is not moving in tandem with other standards observed in the first world.

IOW We are issuing better wages than the developing world’s workers had before, but much else in the employment contract is still not on a par with the standards that are observed in the first world. They are not benefiting in all the ways that one would expect from relating to a more 'mature' and 'progressive' first world employer.

I’m not saying that we should pay them exactly the same rate as first world workers, that’s absurd and I'm not willing to ignore PPP. But I am saying that we should raise their working conditions (hours, safety, job security, work environment, etc) alongside this wage benefit we are bringing as we outsource our labour.
Free trade need not be associated with all this.
Yes, it must. The importance of Ricardo's analysis is that he proved that specialisation of labour works the same way between as within countries. By the way, although you claim that the father of comparative advantage theory was wrong, you haven't presented any evidence to show that this is the case. Care to examine his math and show where he messed up?
Please correct me if I’m wrong here too but I recall that Ricardo failed to take into account a number of other factors, such as other countries in the equation, other goods being traded, production costs etc. This is why I think his theory of comparative advantage does not apply to the phenomena of outsourcing. But I'm open to learning something new today and always :). I've never studied this stuff formally.

I’m certainly not equal to the task of correcting Ricardo’s work, though I’m flattered you gave me the opportunity. But I hope I’ve addressed and clarified why I took such a position on his theory being brought up. Ricardo is indeed relevant to the wider debate of international trade, hugely so, but not to the specifics of outsourcing. Something like this is more appropriate imho...
Karl Marx said:
By what are wages determined?

Now, the same general laws which regulate the price of commodities in general, naturally regulate wages, or the price of labor-power. Wages will now rise, now fall, according to the relation of supply and demand, according as competition shapes itself between the buyers of labor-power, the capitalists, and the sellers of labor-power, the workers. The fluctuations of wages correspond to the fluctuation in the price of commodities in general. But within the limits of these fluctuations the price of labor-power will be determined by the cost of production, by the labor-time necessary for production of this commodity: labor-power.

What, then, is the cost of production of labor-power?

It is the cost required for the maintenance of the laborer as a laborer, and for his education and training as a laborer.

Therefore, the shorter the time required for training up to a particular sort of work, the smaller is the cost of production of the worker, the lower is the price of his labor-power, his wages. In those branches of industry in which hardly any period of apprenticeship is necessary and the mere bodily existence of the worker is sufficient, the cost of his production is limited almost exclusively to the commodities necessary for keeping him in working condition. The price of his work will therefore be determined by the price of the necessary means of subsistence.

Source
Let's focus on this last line, assuming that we have already factored in the price of his training and education and also PPP. I would say that the differing levels in “the price of the necessary means of subsistence” are being distorted in the process of outsourcing. Or it is being used to shield the downgrading of all else, as described above.

Then we also have this factor to consider, which I would say is increasing in prominence:
The same commodity is offered for sale by various sellers. Whoever sells commodities of the same quality most cheaply, is sure to drive the other sellers from the field and to secure the greatest market for himself. The sellers therefore fight among themselves for the sales, for the market. Each one of them wishes to sell, and to sell as much as possible, and if possible to sell alone, to the exclusion of all other sellers. Each one sells cheaper than the other. Thus there takes place a competition among the sellers which forces down the price of the commodities offered by them.

But there is also a competition among the buyers; this upon its side causes the price of the proffered commodities to rise.

Source
Can you see this factor entering the equation more and more these days or is my lack of schooling in the subject showing through?
Seriously, what person with a brain thinks that Bill Gates is a saint?
My point was that the article attributes a quite elaborate socioeconomic theory to him without any data to show that he actually adheres to the listed views.
That’s true.
Glad we agree on something.
To be honest, I get the feeling we’re very much in agreement on a lot of this but differing only by small degrees.
 
It seems I wasn't clear enough and my language was a bit blunt.

No need to apologize. I wasn't offended.

I use a political-science definition of the word "progressive."

Conservative - wants things to stay the same
Reactionary - wants things to move backward
Progressive - wants things to move further in whichever direction they are heading already

The problem with a content-based definition of the word "progressive" is that it assumes a content-based definition of "progress." What's progress? More money? More equality? More radioactive monkeys? Everyone has his own definition. But if you stick to just defining it as "advancement" (in whatever direction), I find that argument becomes easier, because it is easier to compare like with like.

Not too important, really. It's just about semantics.

But I am saying that our management and owners in the first world cannot be considered "progressive" if they do not move forward towards a more equitable and socially responsible relationship. There's a clear and growing demand for such enterprises these days. (In my mind, progressive also means becoming more just, raising grinding poverty, providing humane working conditions etc)

Again, it's hard for me to respond to this because we're not using the word in quite the same way. But if you substitute "economic improvement for all" for "progress," I'm still not completely sure that humane working conditions RIGHT NOW are the best way forward. They're desirable in the long run, of course, but the problem is that they cost money. That takes away part of the Third World's competitive advantage and makes it less likely that businesses will invest there. East Germany is a good example of an area which stagnated because wages were forced to increase too rapidly.

Besides, we've had Capitalism for a long time now, in varying forms. Are you satisfied with it being quite incapable of generating that wealth in a more equitable and widespread manner? Can you see it ‘progressing’ to such a stage as that which I am hinting at here, underpinned by a strong and growing demand for more ethical and equitable labour relations?

A valid point. As I said earlier, I am basically using the word "progressive" to refer to tendencies which already exist beyond dispute. I hope and believe that capitalism will ultimately spread wealth to the whole world. It's just that not everyone believes that, and I was trying to use a more universal, content-neutral definition.

Yes it's entirely relevant to the whole article's thrust, which I read as saying that folk like Gates are benefiting disproportionately, and then trying to make it seem alright with transparent gestures.

Gates gets much richer. Africa gets a little richer. Gates gets to blow his nose with 100 dollar bills instead of 50 dollar bills. Africa gets to eat.

Besides, inequality as such doesn't bother me. It's poverty that bothers me. If Gates wants to donate money to charity, for whatever reason, I don't really care. I think that Gates has already done a good deal of good simply by contributing to world wealth through the growth of the businesses he owns, even though his objective was doubtless selfish. It is not from the generosity of the butcher that we expect meat...

Your example bears little relation to reality because it does not contain any of the other costs associated in the employment contract between us. Where is the cost of training, subsistence and labour perpetuation? In short, the cost of labour and the production of more labour? Where are all the other incumbent costs? Come on. Global trade, and specifically outsourcing within that, is not about two parties just getting a lump sum.

Nope. It's about both parties getting a continuous income. Your point about the extraneous costs is, I think, invalid. Let's take an example: An Indian engineer is trained in India. Evil-O-Rama Incorporated hires him to eat people. Can Evil-O-Rama ignore the costs of his training in his salary? No, because the engineer has the option of emigrating to Canada and eating people there instead. His salary will be a Canadian salary minus a (very large) amount for costs and complexities of emigration, his presumed desire to eat people of his own nationality, and so on.

This also addresses Marx's point, by the way. He took into account competition between workers for jobs, but he forgot about competition between enterprises for workers (both within and outside India in this example). Trained people-eaters don't grow on trees, even in India. In fact, wages for trained workers in India have risen dramatically over the past few years (don't have exact figures, sorry), because a shortage now exists. This shortage, by driving up wages, will ultimately enable more people to become trained. The company, in the last analysis, has to pay the cost of training or do without, and it can almost never do without these days.

In a slightly similar fashion, Ricardo's example (I'm thinking of the Portugal and England trading example he used), bears little reality to the specific phenomena we’re discussing here – outsourcing. Please correct me if I am wrong but didn’t Ricardo work on the subject of international trade specifically between two parties and not the usage of labour in the first world corporate arena?

It's true that Ricardo dealt with bilateral trade, but I believe that his work has been amplified to deal with multilateral trade by other economists.

I am talking about what goes on within one company ie. the decision made by first world corporate management elite to send the more unsavoury aspects of his enterprise to a distant land, where unions may be weaker, where work conditions are poorer, where regulations can allow for serious lapses of justice in the management / labour relationship.

Microeconomics isn't as different from macro as people think. The basic principles tend to hold true.

And it's precisely the weakness of unions and the ugliness of working conditions that creates jobs in the third world. That's their advantage: they're cheap. Give them first-world living conditions, and you ensure that no company will bother to invest. Why bother to invest in Sri Lanka, where the productivity level is a minute fraction of that in the West, if you are going to have to pay wages and non-wage labour costs disproportionate to productivity? Again, the East German example is an excellent one for what happens when wages are fixed at "just" levels rather than levels that make it profitable for companies to hire.


I’m not saying that we should pay them exactly the same rate as first world workers, that’s absurd

It's not just the question of "exactly the same." Rates set by the market are not arbitrary. They are the intersection of demand and supply. If they are kept artificially low OR artificially high, the volume of transactions decreases.

Have you ever tried to get an apartment in New York? The shortage of housing, the slums in desirable building areas, are the consequence of price ceilings which made it uneconomical to build or repair housing. Minimum wages work in much the same way.
Please correct me if I’m wrong here too but I recall that Ricardo failed to take into account a number of other factors, such as other countries in the equation, other goods being traded, production costs etc. This is why I think his theory of comparative advantage does not apply to the phenomena of outsourcing. But I'm open to learning something new today and always :). I've never studied this stuff formally.

The reason why outsourcing is usually viewed as part of free trade is that it is part of specialisation of labour. Look at it this way: Martha, Joe and Richard are a doctor, a lawyer and a cleaner, respectively. Martha can cure 5 patients in an hour, bankrupt 3 clients or wash 3 floors. Joe can cure 2 patients, bankrupt 2 clients or wash 2 floors. Joe can cure 1 patient, bankrupt 1 client or clean 1 floor. In an hour, with perfect specialisation, 5 patients are cured, 2 clients bankrupted and 1 floor cleaned. Total 8. With perfect division of labour, 2.67 patients are cured, 2 clients bankrupted and 2 floors cleaned. Total 6.67. Only if the price of cleaning floors is very high does specialisation not pay.

Outsourcing differs from trade only in that, instead of jobs being transferred indirectly by specialization, they are moved directly by company choice. The same process is occurring: countries specializing in what they do best compared to other countries.

Regarding Marx, see my comments above. What he writes is true only given infinite workers and one company. This may be a reasonable approximation when companies entire highly-educated, low-paid countries like India for the first time, but it changes almost immediately as competition for workers begins.
The same commodity is offered for sale by various sellers. Whoever sells commodities of the same quality most cheaply, is sure to drive the other sellers from the field and to secure the greatest market for himself. The sellers therefore fight among themselves for the sales, for the market. Each one of them wishes to sell, and to sell as much as possible, and if possible to sell alone, to the exclusion of all other sellers. Each one sells cheaper than the other. Thus there takes place a competition among the sellers which forces down the price of the commodities offered by them.

But there is also a competition among the buyers; this upon its side causes the price of the proffered commodities to rise.

This is a basic truism of economics. It's the law of demand and the law of supply. Both operate at the same time to determine the price. There are other ways to derive these laws, but the one you mention is a basic one. The price settles at the point where there are as many people selling as buying.

But these influences apply to everything, not just wages. They are no more forced to keep the price of labour equal to the price of food than they are forced to keep the price of oil equal to the price of extraction.

To be honest, I get the feeling we’re very much in agreement on a lot of this but differing only by small degrees.
Looks like it.;)
 
Oh, man... I'm SO sad I just saw this thread today. Because this is one of these rare ocasions in which a genuinelly interesting debate pops up, I want to join, but I lack the manners to do it, so here it goes, very supperficially.

I have agreements and disagreements with the article. The part that I agree with is about the discrepancies in the modern system, the similarities of it with past ideas and with the dennouncing of the existence of an elite that, in rethoric, pretends not t be there.

About these, I wrote an essay mysef in this forums, a while ago. It is a bit tangencial, but pertinent enough to be quoted here IMHO; I'll reproduce it in the end of this post.

The parts i disagree are those in which it is as ideological as the people it criticizes. As Bozo said, and I concour, the article assumes that wealthy man are wealthy "through dirty tricks"... but it does not bother to elaborate which are these. Unless they've done something illegal, than, the truth is that the "tricks they played" aren't "dirty", even if not coherent with their self-advertised philantropy.

What brings me to my main points of contemption: the article focus a great deal of energy on the contradictions and inconsistency of this ideology, to demonstrate it lacks, as an construct, validity (what makes it a dirty tricky with what "the old gangs of suspects" tricks humanity to think they are a progress they themselves oppose).

The first point of contemption is to suppose that there was a progress in the working, and these people are blocking it. I have my doubts that we'd betruly in the process of a significant social emancipation if Mr. Gates and Mr. Soros were not giving us bread and circus.

The second is to think that these man are doing these things in the pursuit of an agenda of whatever kind. I agree that there is a creed, and that creed is pretty much that which trhe article diagnoses, but I don't think there is any elaborate drive behind these actions of philantropy except yto think they are the right thing to do... this, I think because these people don't have to sell an image. They have already conquered the world, and they have nothing of significance to achieve with that.

Finally, I think that criticizing the ideology because it is contraditory is a no-no. Every pragmatic approach on how the world will function is, because the reality can never be contained in the discourse. In fact, I like to think of ideologies as goals, leads to aim humanities decisions, and finding the best route. Any attempt to follow an ideology - any ideology - to the letter will end up in disaster. This which they add to their captalistic wealthy-seeking - the desire to help other people - even if added euphemastically, just am old idea with a new dressing, and of questionable pragatic results, the contradiction here denounced, is, at least, one of benevolent leaning, and while the road to hell is paved of good intentions, bad intentions are an even shorter path there.

Anyway, follow the atricle i wrote before:
 
this is the original thread

It’s been a while since I've seen a thread this interesting. Well, I think I’ll add my own two cents too.

This question is, above everything, a moral matter. We are not discussing whether money accumulation works or not – it’s undeniable that it does, economically speaking – but if it is an acceptable policy to rule the world by. Is it functionality enough to erase, minimize, or even simply justify the imperfections that prospers within this structure?

In a close second, comes a structural question: It works, but for how long? Is this sort of idiosyncrasy the kind of pressure that can break the present system down?

Those are the questions that I saw in the original post, and they require very careful propositions (as I don’t dare to call my divagations “answers”).


About Justice:

Despite this is not THE question proposed, I guess that defining “justice” is instrumental when dealing with such matters. This is not easy task, thought. In my first year in Law School, it took me 25 pages of digressions in a monograph just to realize that I was not more able to define it than I was when I begun… But I’ll refrain from such exaggerations in this forum and keep it small.

This is “justice” according to the Merriam-Webster Online Dictionary:

Pronunciation: 'j&s-t&s
Function: noun
Etymology: Middle English, from Old English & Old French; Old English justice, from Old French justice, from Latin justitia, from justus
Date: 12th century
1 a : the maintenance or administration of what is just especially by the impartial adjustment of conflicting claims or the assignment of merited rewards or punishments b : JUDGE c : the administration of law; especially : the establishment or determination of rights according to the rules of law or equity
2 a : the quality of being just, impartial, or fair b (1) : the principle or ideal of just dealing or right action (2) : conformity to this principle or ideal : RIGHTEOUSNESS c : the quality of conforming to law
3 : conformity to truth, fact, or reason : CORRECTNESS

As you all can see, it is very vague. However, I’ll highlight the word “equity”, that finishes the proposition number one. This is the aspect of justice that matters in this discussion.


A Working Society:

When we stick to political studies, we learn the fundamental reasons why the society even exists. Philosophically, it goes like this: Every person in the world is equal and born free to do whatever he/she pleases. That freedom, however, is false, because equally, all others are free to do the same. Soon enough, the limited materials to satisfy the ever growing demand will generate conflict of interest, and that, in an environment that possesses no notions of morality (not necessary until that point) will became prodigious in unrelenting and unreasonable struggle, violence, bloodshed.

Society, as an (semi)organized entity, not only provides minimal standards of behavior (traditions, rules, laws, etc…) to minimize such confrontations, but it also provides the means to keep what’s unavoidable in sustainable degrees, thus allowing people to prosper.

By all this, my point is that society, in all it’s aspects – economic aspect included – has a fundament, an ultimate goal, and that goal is to provide the well being of their citizens… ALL of them, even if some are better at this than others.

We then fall in the deeper aspect of the question: Is it acceptable that society uses unfair means (such as unequal distribution of wealthy, as in the case “in locu”) to achieve this general well being?

Well, the very concept of society is that of people giving up some prerogatives in the interest of personal participation in a good greater than his/her own (as Thomas Hobbes said, giving up freedom to join the Leviathan). Theoretically, then, the imposition of a personal gain that is inferior to the personal production can be acceptable, as long as, in the big picture, it generates the well being of the citizens in this society.

This was the point of a few of the previous posters, that expressed concepts such as “the accumulation favors the investments and helps to keep economy growing”, or “the huge amount of money possessed by few does not mean they are out of the market, since it is flowing in the bank system and helping the economy”, or even “the riches are richer, but so are the poor, even if in a small scale”.

This view, I agree, is pretty functional, and the more accurate description of how our society works presently. I however, have to disagree completely with the implying that this is a good, natural and desirable thing, within the boundaries of the proposed question.

As I stated above, the original proposition regarded the acceptability of such thing, not it’s functionality (to resume, does it matter, or does it not?). Arguing its functionality (as even the original message did) is, IMHO, escaping the subject. It is like asking if raping is a moral way of achieving sexual thrill, and have a rapist saying “well, it is pleasurable”… maybe, but that’s not the question.

So, consider this: No one can get *rich* outside a society. Not only we are hopeless against assault outside its protection (it’s impossible to stay permanently alert), but also it’s impossible for a single man to achieve, without benefiting from other people works, the kind of fortune we see people having today. Therefore, it’s safe to say that, in many aspects, society is the cause of such prosperity.

A person that is able to be super-productive deserves, no doubt, a bigger piece of the pie. No one can deny that people who have made great achievements does deserve to benefit from those. I, however, ask this: Is this possible for a man to be worth, alone, as much capital as, for example, Bill Gates? Of course not.

Without any personal attack on him, and even recognizing his great talents, a single man cannot single-handed generate so much wealth. Therefore, he is benefiting from wealth that is generated by others. Some will say that he deserves such, because he is an enterpriser, he had vision and competence to create his company and to invest and to be a leader, etc… I won’t oppose to that arguments, I won’t even disagree, since that is, as I said above, the way the logistic of how our system works.

Everyone please note that the idea of man, for one reason or another, benefiting of the sweat and blood of others is nothing new, and is not a prerogative of capitalism. There has never have been a single society where it didn’t happen, for assorted reasons, such as being the “voice of god”, being “the king” or “the nobility”, being a part of the “communist party” or “being a successful enterpriser” as we accept today in the rule of a capitalist economic model.

My point is that in the past, reasons such as accident of birth or political ascendancy were considered valid, fair reasons to allow some aristocracy to have common people providing their surplus-value to this dominant, privileged class. Such reasons are, today, considered odious, while the reasons that fit our model are not. Nonetheless, these are not intrinsically more “unfair” than the modern take, they are just old and out of fashion.

There is, in the present days, the myth that every rich person in the world is so because he has a kind of vision and competence and working skill that is unparalleled by the common man, and so, they deserve such life of privilege. In the past, people that are “better” were recognized by their bloodline. Today, it’s by their bank account.

I’ve seen plenty of support for such inadequacy, as I read many times arguments like “envy for those who did better” and “If you don’t have it, is because you didn’t deserve” (what implies that the “contrario sensu” is true). People seen to be willing to completely validate the exploration that capital owners impose on working classes.

I do not hate the bourgeoisie and in fact I can appreciate their role in the world. I also do not fall for the fool line of arguing that every rich man is mean. But it’s undeniable that they are beneficiaries of a perverse infrastructure, and that it’s not right to give that class complete moral redemption, as some here seen to have done.

So, despite the fact that competence does deserve recompense, when a society, which’s ultimate goal is to serve equally all people, will allow in it’s mechanics that some person uses his/her edge (be it nobility or competence or whatever) to achieve a part of the cake that is not simply the expression of their (eventually greater) productivity, but also the part that belongs to others due to their own productivity, it is failing it’s basic goals, because it’s allowing a subtle but institutionalized version of the primal predicament of man abusing other man, the very thing it was created to avoid – and worse, providing them unparallel power that makes the abuse even more invasive.

There is no one so special and talented in the world that can be fairly blessed with money enough to buy whole countries, no matter the flaws in economy theory that allows some to do so. Such accumulation is a distortion of values and an exaggeration of their merits and the fact that the poor have had slight improvements in their conditions does not change that the slightest.

So, my answer to question number one is yes, that it is unfair, and it is a problem to have an income inequality, especially one that is increasing as we all seen to agree here.


(to be continued)
 
... and the second part.

(continuation)

Aristocracy and the human nature:

For this argumentation, I use the term aristocracy in a very wide sense – reaching every single privileged class, not only nobility.

I dedicated the first part of this post to express my opinion that the myth of a inherent superiority of will and skill of those who achieve great fortunes (bourgeoisie) is a fallacy, not so different from the ancient ideals that made middle-age people believe in the superiority of the nobility, something that sounds repulsive and foolish to the modern man.

It is easy for us, deeply used to the capitalism rhetoric, to believe in such fallacy. We are all instructed, from or cradles, that working generates wealth, that if we work hard we can get rich, and that capitalism allows movement between classes (so one day we can get there), and that it privileges competence. And it is all true to some degree, but all of those notions are over-rated.

It ignores completely facts of life, such as the different opportunities people get; the abusive use of capital to guarantee the maintenance of the “status quo”; all the giving up good ideas due to lack of materials, capability of investment or lack of time, that has to be dedicated to more immediate and less promising goals, such as buying food. All those are factors that can kill the potentials of lots of good people while putting others not so good in a no-loose situation.

Most of people I know DO work very hard (myself included). I know some people of largely commendable abilities and yet, I know that most of them – most likely them all – will not get rich. They will never reach the top of the food chain, no matter their capabilities and competence. But we all feel comfortable with the system because we have this small hope of getting rich some day. Obviously, this claim that all that takes to be rich is work is false, because it’s impossible that most people gets rich, even being true that most people do work hard.

Also, I’d like to add that the notion that riches are getting richer, but the poor are also improving is a simplification. It is valid only when you limit the analysis to the rich nations. There are still large masses of people in the world whose living conditions are under the most basic lines of poverty. There are lots of hunger and endemic lack of conditions in the world. In this world where everything take places in global scale, where decisions made in any major office can affect the life of people everywhere, I don’t think it’s fair to count them out when making the balance of human achievements.

Despite that, I want to point out, before someone accuses me of being a communist (like others were, and like it is a bad thing), that I AM NOT one. I am just trying to expose my opinions on a few tribulations of the capitalist system. However, in fact, I do not have a working alternative to propose. I agree that the present system is the best ever implemented, and that, if to many extents it means the super-hyper-ultra-over-privileging of some people merits at expense of others, it’s at least merit-based in essence, what makes it a lot more bearable.

Thus, I agree that the existence of an aristocracy, despite morally and philosophically wrong, is a necessity in the very terms the other posters exposed. It is a channel to canalize the society surplus and to multiply it’s resources. It, however, brings me to the question number two: For how long will it be so?

Well, I am not pretending to offer a deadline to the fall of our economic models, as it would be really presumptive and a very big guess. But I think that a little bit of dialectics is in order here.

As you all probably know, dialectics is a dynamic method of studying modifications in systems through the analysis of its effects and the related causes-consequences. Once we have proposed theses, we confront it with its flaws that accumulate with time. Enough flaws and adapting modifications will make the system change in its antithesis, the negation of its patterns. Then a confrontation of this new reality and the good that still existed in the old system will bring the synthesis, or new thesis, a construct that, theoretically, sums the best of the opposing abandoned ones.

Admitting our system as theses, the “income inequality”, among others, will be one of it’s flaws and inadequacies, meaning that it’s one of the pressing elements that will, ultimately, lead to the collapsing/morphing of the very system that generated it.

I really do not agree with the rationalization that the poor are also getting better, so the “gap” between social classes starts loosing it’s relevance. Not only for the reason I have already mentioned (the limitation of the observed area), but as well due to the fact that believing that people will easily accept that sounds like ignoring the human nature.

There are a lot of people that are not angry at the privileged, me among them. But there are a lot of people who are, no matter if they are reasonable about it or not. Also, there is the fact that we here, people who has houses, surplus of food and money for luxuries, are also among the benefited, even if most of us are not among the really rich. Our satisfaction with having house, food and internet comes from the fact that we have a desirable condition.

If one day this comes to be the very minimum, we will be revolted for being reduced to it while others have so much more. It’s not part of our nature to be satisfied, we are always craving for the good things around us. The realization that we will be living much better than people in the middle ages (or even 50 years ago) did will hardly work as a consolation.

So, inequality will always be a factor of corrosion in the capitalist society, the same way it would be in any system whatsoever that enforces it.

My Conclusion:

So, straight answers to the questions I saw:

1 – Is the income inequality a problem?

R: Yes. The accumulation of wealth in the degrees we are witnessing is only possible through exploitation of the society, which bears it only because there is no better solution available yet. It however does not change the fact that it breaks the equality that society aims, and that the search for the utopia – a model that favors both equality and productivity – must always be kept.

Today’s model functionality does not redeem it’s perverse nature.

2 – Is this model of inequality functional in the future?

R: Yes it is. I can’t imagine it being abandoned anytime soon, because so far there are no viable alternatives. It is still the best thing we have. However, it holds in itself the seeds of it’s own destruction.

Well, Guys, sorry for the bible I wrote above, but it is really an interesting theme and it took me that much to express myself properly.

Regards :) .
 
Atropos: Thanks a lot for the prompt and thorough reply. Good points there, as expected. My lunch break ended, so I'm back onto sporadic, limited posting mode. I'll mull over it all though, you've given me some very clear and valuable info there. Much appreciated. Just one thing to ask, can you guide me to some names that have "amplified" Ricardo's bilateral theories to deal with multilateral trade please?

Looking forward to reading Fred's 'Bible' too shortly :)
 
@FredLC: Whoah, that's quite an opus. I'll be reading it later, hopefully.

@luceafarul: Blunt instruments as self-identification polls are, my "Extremists!" poll would seem to indicate you're indeed right we've got a good many more libertarian-style folks here than hardcore commies.
 
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