The Promise of Capitalism.

[Mojotronica]

As I understand it, the ideologue's promise of Capitalism is that (coupled w/ Democracy) it will -- eventually -- allow the developing world to share in the prosperity and freedom that the industrialized world enjoys.

In fact, the ultimate goal of Capitalism is often presented as identical to the ultimate goal of Socialism, but ideologues argue over the possibility of each system working.

Do you think it's possible for Capitalism to bring this about? Or maybe just more possible that under Socialism? Or you could reject the promise of Capitalism as a sales technique -- but that begs the question of why on Earth the developing world would want to sign on?

Keep in mind. 14% of all humans live the way most of the CFC community does -- in the industrialized world. The remaining 86% lives in the developing world. What happens when everyone owns a car, for instance, or when everyone eats a primarily meat-based diet, or when everyone uses a hundred gallons of water everyday, not to mention a small power-plant's worth of electricity?

How is Capitalism going to deliver on the promise?

 

[napoleon526]

Originally posted by Mojotronica
As I understand it, the ideologue's promise of Capitalism is that (coupled w/ Democracy) it will -- eventually -- allow the developing world to share in the prosperity and freedom that the industrialized world enjoys.

In fact, the ultimate goal of Capitalism is often presented as identical to the ultimate goal of Socialism, but ideologues argue over the possibility of each system working.

I must disagree. Capitalist theory allows that everyone should have a CHANCE of success, not a GUARANTEE of it; that would be communism. It's also natural to capitalist theory that most people have someone who is richer than they are, as well as someone who is poorer. Capitalism encourages equality of opportunity only.

 

[cgannon64]

I think you are right in saying that Capitalism's ultimate goal is world equality and wealth - look at the American dream. However, I think neither Capitalism nor Socialism can acheive this. Capitalism has the problem of corporate corruption and using less-than-legal methods to "beat the system". On the other hand, Socialism has the problem of government corruption and less-than-legal methods to beat the system.

We'll all flawed.

 

[Mojotronica]

napoleon526 --

Will the ratio of haves and have-nots always be around 14% to 86%?

And what reason do the have-nots have to be involved in it?

 

[Narz]

I agree that the waste and disregard for the world around them by many middle-class (and higher) Westerens is despicable but thats just the way most people are, they only stoping wasting in times of shortage...

The best thing we can do for developing nations is to be open to trade with them. Droping plane loads of money on them (physically or metaphorically) will only hurt them further.

- Narz

 

[Thadlerian]

Keep in mind that capitalism requires a large amount of poverty to catually work. This to produce cheap goods. If there was no such poverty, people would not work for the lousy wages that textile/electronics industry and low-status services pay. Last time I looked, robots were centuries away from the state where they can produce everything without cost, which I would guess is the ultimate goal of Capitalism. Unfortunately, this is not even near future, and in the meantime, billions are suffering.

I find it indeed very wrong to defend Capitalism from a Western point of view. Lemme see an African cocoa harvester or a Malaysian shoe-factory woker claim that Capitalism is teh Heaven for everybody, only then I would believe that it would be. But not before that. No way.

 

[Mojotronica]

Narz --

What about the imbalance of trade? Raw materials are worth a lot less than finished goods, and raw materials are what many of these nations have to trade to the developed world.

In fact one could argue that many of these nations were better off before they got involved in trade w/ the West -- they were self-sufficient. Now w/ their dependence on cash crops, they often can't feed their people w/out importing food.

 

[Mojotronica]

If the goal is to create opportunities for wealth, than do the citizens of the developing world have MORE opportunity or LESS (or the same amount) in this system?

Do only the comparatively wealthy have the opportunity for wealth?

 

[Akka]

Capitalism is basically the "law of the fittest" where you replace "kill and feed yourself" with "gain money".

It's in itself a totally amoral system which only look for efficiency.
Moreover, it's based on a idea of perfect competition that is a pure ideal in itself.

Thinking it can bring happiness and well-being to humanity on its own is even more an illusion that thinking that communism can do.
Both would require a perfect world with perfect people to work.

 

[napoleon526]

Originally posted by Mojotronica
napoleon526 --

Will the ratio of haves and have-nots always be around 14% to 86%?

And what reason do the have-nots have to be involved in it?

I think that in the future, with wise economic policies, the worldwide split could be 50/50.

As for the have-nots, there will always be a demand for cheap labor. Why pay Americans minimum wage with benefits to make something when you can get Indonesians to do the same work for less than a dollar a day?

 

[Greadius]

Originally posted by Mojotronica
As I understand it, the ideologue's promise of Capitalism is that (coupled w/ Democracy) it will -- eventually -- allow the developing world to share in the prosperity and freedom that the industrialized world enjoys.

Thats the plan

If you look at a list of the 20th wealthiest nations on Earth you'll see a common string... and its not Western.

Originally posted by Mojotronica
Or you could reject the promise of Capitalism as a sales technique -- but that begs the question of why on Earth the developing world would want to sign on?

Well, they're not as stupid as some people make it out to be.

The only way nations in the world have ever created a high standard of living was industrialization, democracy, and capitalism. Nothing else has been done successfully.

Originally posted by Mojotronica
Keep in mind. 14% of all humans live the way most of the CFC community does -- in the industrialized world. The remaining 86% lives in the developing world.

There was a time when this ratio was even further off. There was also a time, about 200 years ago, when there wasn't much difference between the wealth of the world; everyone was poor. The biggest problem with catching up wealth % is that the population in poorer countries grows much faster... so its kind of misleading.

Originally posted by Mojotronica
What happens when everyone owns a car, for instance, or when everyone eats a primarily meat-based diet, or when everyone uses a hundred gallons of water everyday, not to mention a small power-plant's worth of electricity?

Do I sense some Malthusian arguements. Efficiency and technological advancement are vital in the progress of capitalism. As more of the worlds population raises their standard of living, these products will be more efficiently produced, cheaper, and so forth.

Just look at how much food the U.S. is capable of producing with less than 1% working as farmers.

Originally posted by Mojotronica
How is Capitalism going to deliver on the promise?

Its not a promise, its a premise. Developing countries have a model, and quite a few have successfully or are successfully using it. Some are going off in their own directions, and others have botched it completely.

Long term economic health isn't an exact science, and every country has had to adapt its own changes to the blueprint to make it won, and carve out its global niche market. For example, too many countries are hedging their bets on mass producing automobiles, and some of them are going to struggle.

Originally posted by Thadlerian
Keep in mind that capitalism requires a large amount of poverty to catually work.

Wrong. Well, kind of wrong. That depends on your definition of poverty. The poverty line in America is higher than the average person in the world lives off...much higher. Poverty is a relative measure, not absolute. If people in poverty have a house, home, food, color TV, free education for their kids, and the OPPERTUNITY to lead a successfull lives... well, they're doing a heck of a lot better than people in the poverty line in Ethiopia.

Originally posted by Thadlerian
Unfortunately, this is not even near future, and in the meantime, billions are suffering.

Billions of people will suffer regardless. Blame God, not capitalism.

Originally posted by Thadlerian
Lemme see an African cocoa harvester or a Malaysian shoe-factory woker claim that Capitalism is teh Heaven for everybody, only then I would believe that it would be. But not before that. No way.

Better oppertunity than they had before. Those low paying factory jobs are coveted by locals because they're stable, better paying, and have better working conditions than the other jobs that are available.

Yeah, they're lives are miserable... if they want that to change in the long term its not going to happen if they cross their arms and demand handouts.

Originally posted by Mojotronica
What about the imbalance of trade? Raw materials are worth a lot less than finished goods, and raw materials are what many of these nations have to trade to the developed world.

That isn't necessarily an imbalance. Ideally, it'd be an issue of free trade in which imbalance is a difficult concept to pin down. Trade, as a voluntary action, never causes an imbalance... rather, its the limited number of buyers & producers that create problems when only one side is competing for a good price.

Originally posted by Mojotronica
In fact one could argue that many of these nations were better off before they got involved in trade w/ the West -- they were self-sufficient. Now w/ their dependence on cash crops, they often can't feed their people w/out importing food.

And if you value self-sufficiency, that is North Korea's goal too

A higher standard of living won't be achieved with closed borders. The BIGGEST problem you're talking about, is the refuse of Western nations to abandon archiac farm subsidize and compete with foreign farmers. Trade protectionism is not something most capitalist will advocate as good, so we're kind of in a position where you're using something we criticisize capitalism using something we don't like as the barometer.

Originally posted by Akka
Capitalism is basically the "law of the fittest" where you replace "kill and feed yourself" with "gain money".

And amazingly, man has yet to create a better law than nature.

Originally posted by Akka
It's in itself a totally amoral system which only look for efficiency.
Moreover, it's based on a idea of perfect competition that is a pure ideal in itself.

Well, it says capitalism will only maximize efficiency with perfect competition, which is a theory. However, there are degrees of competition which relates to degrees of efficiency.
Then, there is a competing theory (which, actually, makes more sense to me) that says as long as there are two firms there will be competition, and the number of firms doesn't influence the efficiency a lot.

Originally posted by Akka
Thinking it can bring happiness and well-being to humanity on its own is even more an illusion that thinking that communism can do.
Both would require a perfect world with perfect people to work.

Not at all... that is the brilliance of capitalism: all it depends on is for people to act like people and conduct their economic affairs in a fallible, risk taking, self-interest motivated manner.

But the question asked about prosperity & freedom, not happiness... wealth does not equal happiness, but I suspect it influences it. Nonetheless, if you use a model of prosperity it is undeniable, once again, that degree of capitalism and prosperity are somehow interconnected. Likewise, it is undeniable correllation between time of government adoption of these policies and level of prosperity; that is, nations which jumped on the bandwagon earlier and stuck with it are much wealthier now than the nations that haven't. Capitalism as a policy means basically a governments general attitude in dealing with economic manners. There are too many other factors to mention that will determine where and when prosperity spreads.

Originally posted by napoleon526
Why pay Americans minimum wage with benefits to make something when you can get Indonesians to do the same work for less than a dollar a day?

Keep in mind that in Indonesia, a dollar goes a heck of a lot farther in purchasing power than in America.

 

[Archer 007]

Originally posted by Mojotronica
Narz --

What about the imbalance of trade? Raw materials are worth a lot less than finished goods, and raw materials are what many of these nations have to trade to the developed world.

The best idea is to shift industrial works to undeveloped countries.

 

[Richard III]

I was feeling this wave of sickness reading the posts, and felt disappointed in myself that I really couldn't stomach having to explain 300 years of economic history AGAIN...

But then, I saw that Greadius is in there. Flush 'em out, Greadius! Fire in the hole!

 

[Sultan Bhargash]

Originally posted by Greadius

Keep in mind that in Indonesia, a dollar goes a heck of a lot farther in purchasing power than in America.

I was with Richard on your post till I saw this little irritating bit.

Why not admit that as glorious as capitalism is, it requires regulation- ideally global controls- to keep from turning into an altered form of feudalism.

In point of fact, it is quite possible that you might get more filthy rice or more property to put your ****ty hut in out of a dollar in Indonesia, but that doesn't excuse international corporations from doing their damnedest to bring up the standards of living in the places they crouch by paying the workers well... especially in an age when the combination of extreme poverty and cash being siphoned away from third world countries breeds the threat of unspeakable terrorism.

 

[knowltok2]

Originally posted by Antonius Block


I was with Richard on your post till I saw this little irritating bit.

Why not admit that as glorious as capitalism is, it requires regulation- ideally global controls- to keep from turning into an altered form of feudalism.

In point of fact, it is quite possible that you might get more filthy rice or more property to put your ****ty hut in out of a dollar in Indonesia, but that doesn't excuse international corporations from doing their damnedest to bring up the standards of living in the places they crouch by paying the workers well... especially in an age when the combination of extreme poverty and cash being siphoned away from third world countries breeds the threat of unspeakable terrorism.

To be fair, he never said that capitalism should be totally unrestrained. It gets interesting trying to determine to what degree...

Your point non-withstanding, his point on the relative purchasing power in two different locations is valid. Relative purchasing power is what needs to be considered. This does not mean that the worker is under or over paid, it simply is a way of comparing apples to apples, which in the internation economic sense, comparing a dollar in the US and a dollar in Indonesia certainly is not.

 

[Sultan Bhargash]

I don't know Knowltok, when you factor in quality of life, maybe it is.

 

[Greadius]

Originally posted by Antonius Block
Why not admit that as glorious as capitalism is, it requires regulation- ideally global controls- to keep from turning into an altered form of feudalism.

Well, no, not ideally global controls, and no, it doesn't turn into feudalism but mercantilism... but of course it needs regulating. Capitalism is a set of policy, and policy in action becomes laws, and laws on business' are called regulations, and regulations need to be enforced. Anti-competitive practices as well as inhumane practices (leaving that open to the interpretation of the reader) should be and are against the law.

Originally posted by Antonius Block
In point of fact, it is quite possible that you might get more filthy rice or more property to put your ****ty hut in out of a dollar in Indonesia, but that doesn't excuse international corporations from doing their damnedest to bring up the standards of living in the places they crouch by paying the workers well... especially in an age when the combination of extreme poverty and cash being siphoned away from third world countries breeds the threat of unspeakable terrorism.

Uhm...
1. Cash can't be siphoned away from third world countries, they have none.
2. Extreme poverty has always existed, furthermore, kings in the 1500 century live worse than people in poverty do today. Its not inherently inhuman to live in a crappy hut and eat dirty rice; as a race we've been doing that a lot longer than what we're doing. As long as they're making progress (which they are), its too early to declare it a failure.
3. In most places international corporations set up, they're the best paying job oppertunity... ever. That is why they pick those locations; they're so economically depressed they can pay the workers half as much and they'll appreciate it twice as much, because to them, its a lot of money... and a heck of a lot better option that subsistance level farming if they're lucky, or working on someone elses farm picking crops for 12 hours a day.

The main point was that standards of living, wealth, ect. don't exist in a vacuum. Its like a version of Marie Antoinette statement about "letting them eat cake", when they consider bread a luxury. 100 years ago, so did we.

 

[Sultan Bhargash]

Points for disagreement...

Originally posted by Greadius

Uhm...
1. Cash can't be siphoned away from third world countries, they have none.

Well, I guess I meant "wealth"- from raw materials to labor inputs.

2. Extreme poverty has always existed, furthermore, kings in the 1500 century live worse than people in poverty do today.

Well of course there's always been "poverty" since the rise of city states or whatever. But as far your comment on Kings, it really depends. Some kings maybe lived worse than some poor people, but I doubt that any kings lived as badly as the worst off peoples do today. And I know that in 1500 some kings in Asia, the Americas, and Africa, lived better than many "middle class" people in those locales do today.

Its not inherently inhuman to live in a crappy hut and eat dirty rice; as a race we've been doing that a lot longer than what we're doing. As long as they're making progress (which they are), its too early to declare it a failure.

No, but it is inherently inhuman to live in a crappy "hut" and eat dirty rice if you are putting in 14 hour factory shifts to make shoes that will be sold for $100... C'mon.

3. In most places international corporations set up, they're the best paying job oppertunity... ever. That is why they pick those locations; they're so economically depressed they can pay the workers half as much

A lot less than half, oh robber of US jobs...

and they'll appreciate it twice as much, because to them, its a lot of money... and a heck of a lot better option that subsistance level farming if they're lucky, or working on someone elses farm picking crops for 12 hours a day.

Depends on the climate, really. Subsistence farming can be a blast. And if the end result is the same quality of living, I'll take the farm over the factory any day. Another fact is that those jobs and whatever cash economy splashes over the toilet seat from them tend to immediately drive up the prices beyond what the other million people who didn't get a hole in the sweatshop can reasonably afford.

Don't get me wrong, I'm very down with capitalism. I just don't like to see the abuses swept aside or ignored, it leads to bad things, like Communist revolutions and such...

 

[GerrardCapashen]

Originally posted by Antonius Block
Well of course there's always been "poverty" since the rise of city states or whatever. But as far your comment on Kings, it really depends. Some kings maybe lived worse than some poor people, but I doubt that any kings lived as badly as the worst off peoples do today. And I know that in 1500 some kings in Asia, the Americas, and Africa, lived better than many "middle class" people in those locales do today.

Since you're an anthropologist, I am sure that you are far more informed on this subject than I am, but I would be interested to know of any monarchs in the 1500s that had better lives than middle-class people nowadays, including life expectancy, medical care, quality of diet, and other things like having houses that are heated in the winter and cooled in the summer. (It wouldn't be hard to heat a dwelling with a fire, but cooling it might be more difficult.)

 

[Greadius]

Originally posted by Antonius Block
Well, I guess I meant "wealth"- from raw materials to labor inputs.

The value input of labor is from foreign capital... without it, the labor would be worth alot less.

Likewise, raw materials are worthless if you have no way of finding, extracting, harnessing, processing, and utilizing them.

Originally posted by Antonius Block
Well of course there's always been "poverty" since the rise of city states or whatever. But as far your comment on Kings, it really depends. Some kings maybe lived worse than some poor people, but I doubt that any kings lived as badly as the worst off peoples do today. And I know that in 1500 some kings in Asia, the Americas, and Africa, lived better than many "middle class" people in those locales do today.

Really? No clean food, no clean water, no heating, no A/C, no cars, no computers, no light, no indoor plumbing, no useful medical care. Just as bad: no potential to get any of them. The point is there really wasn't anything glorious by todays standards of being wealthy back then... it was all miserable.

Imagine how people in 2500 will view our standard of living?

Originally posted by Antonius Block
No, but it is inherently inhuman to live in a crappy "hut" and eat dirty rice if you are putting in 14 hour factory shifts to make shoes that will be sold for $100... C'mon.

And its economically disingenius to believe the $100 tag has much to do with the labor input.

The first try at capitalism, the labor theory of price, thought like that. It was a miserable failure.

What you're paying for is $99 worth of Kobe Bryant marketing paycheck to make you want the sneakers and $1 worth of production costs.

Originally posted by Antonius Block
A lot less than half, oh robber of US jobs...

I assume you're being sarcastic so I won't rant, but if you're not I'd like to.

Originally posted by Antonius Block
Depends on the climate, really. Subsistence farming can be a blast. And if the end result is the same quality of living, I'll take the farm over the factory any day.

Nice to have a choice, isn't it? I'm sure those people feel the same way. Better than that, diversifying their economy, even a little, helps ease the damage of the business cycle.

For me, every minute I have to spend in the sun is torture (irony in that).

Originally posted by Antonius Block
Another fact is that those jobs and whatever cash economy splashes over the toilet seat from them tend to immediately drive up the prices beyond what the other million people who didn't get a hole in the sweatshop can reasonably afford.

Oh geez... first, you argue they're not being paid enough; NOW, you argue they're being paid too much!

Which one is it?

Originally posted by Antonius Block
Don't get me wrong, I'm very down with capitalism. I just don't like to see the abuses swept aside or ignored, it leads to bad things, like Communist revolutions and such...

I thought belief in entitlements, idealism, and the Soviet Union lead to communist revolutions.