What is Socialism?

[Lexicus]

Does anybody enter into a market without wanting to increase the concentration of wealth (not just cash, remember) in their hands? We usually define enterprises without a profit motive as explicitly non-market - charities and public services, for example.

Yes, in my belief people do enter markets for reasons other than this, and I regard it as a grave intellectual crime that mainstream economics has managed to convince people that this is what people do when they participate in markets despite it being obviously false and refuted by personal experience.

Some people do attempt to increase their wealth and power through every transaction in the market, but those people are a tiny minority. The vast majority participate in markets because our society is sufficiently complex that it would be near-impossible to get what you need to live otherwise. For example, today I 'entered into a market' by going up the street a few blocks for pizza, and I did it because I was hungry and wanted to eat, not because I felt like increasing my wealth and power.

Now, I would guess your response will probably be something like "you increased your wealth and power because the pizza was worth more to you than what you paid for it," and my response would be that that is metaphysical interpretation and is of absolutely no concrete use in describing the reality of what I did today.

We usually define enterprises without a profit motive as explicitly non-market - charities and public services, for example.

I don't think this is accurate at all. Charities participate in markets all the time without having a profit motive - as do worker cooperatives and other nonprofit organizations. The idea that a charity which, for example, receives donations and then purchases blankets to distribute to the homeless is not participating in a market simply because it is not a for-profit outfit is a ridiculous contortion of logic, the sort of thing that tells you you need to drop your premises because they're leading you to patently false conclusions.

 

[Old Hippy]

Workers control of the means of production, which you might notice, has nothing to do with social democracy or the public sector of the economy

that's more a problem with what social democracy means, as definitions define the aims being sort after

a socialist system of government achieved by democratic means.

which extends the meaning of socialism, to more than workers as it includes all non workers as well

 

[W|M]

that's more a problem with what social democracy means

Social democracy is capitalism with lots of welfare

Some people do attempt to increase their wealth and power through every transaction in the market, but those people are a tiny minority. The vast majority participate in markets because our society is sufficiently complex that it would be near-impossible to get what you need to live otherwise. For example, today I 'entered into a market' by going up the street a few blocks for pizza, and I did it because I was hungry and wanted to eat, not because I felt like increasing my wealth and power.

Had you not paid for it, it's unlikely you would have been unable to get a pizza without the police being called soon after. Without money you would be powerless to eat, helpless in the face of starvation, but having money to buy food destroys that powerlessness, at least for as long as you still have it.

 

[Lexicus]

This seems to imply that we live in a meritocratic society where anyone can accumulate as much wealth as they can. This isn't true of course, and it wouldn't be true even with higher taxes on the rich, because they would still control the means by which wealth is produced, and would therefore be constantly concentrating wealth in their own hands

It has nothing to do with meritocracy. The observation that people can get rich in their lifetimes rather than simply inheriting money has nothing to do with meritocracy one way or the other.

As for the second half of this, it's obviously not true. You can control the means by which wealth is produced, but if the state is seizing the surplus and redistributing it to the workers then you're going to find it quite difficult to concentrate wealth.

Workers control of the means of production, which you might notice, has nothing to do with social democracy or the public sector of the economy

You're going to have to elaborate on this a little, both on what 'workers control of the means of production' actually looks like in practice and why it 'has nothing to do with social democracy or the public sector of the economy.'

The reasons why people trade in markets can still be boiled down to wanting an increase of wealth and power, regardless of when or where the markets are. The capitalist mode of production especially forces people to depend on markets for survival, taking away control over every aspect of their lives if they refuse to trade, which makes it so that everyone is forced to try to constantly increase their wealth (and thus purchasing power).

See my response to Flying Pig. I just don't think this is true. As an empirical fact it is simply not the case that all participation in markets is done with the goal of increasing the participant's wealth and power, and if it's just going to be a matter of interpretation -ie, telling me how when I went to get a pizza today I was really, and unbeknownst to myself, trying to increase my wealth and power, because reasons - then I'm not interested in arguing with it anyway.

EDIT: I see from your post above here that that is indeed what you were arguing. I'm not interested in arguing against unfalsifiable metaphysical claims.

 

[Old Hippy]

Social democracy is capitalism with lots of welfare

it can be, but dose not have to be.
that your version/definition is no different form capitalism
workers socialism would be workers on top while others had lots of welfare.

more is needed

 

[Lexicus]

it can be, but dose not have to be.
that your version/definition is no different form capitalism
workers socialism would be workers on top while others had lots of welfare.

more is needed

I like to point out that my definition of socialism includes policies that depart from market logic in a way that benefits the rich at the expense of the poor.

 

[Timsup2nothin]

Now, I would guess your response will probably be something like "you increased your wealth and power because the pizza was worth more to you than what you paid for it," and my response would be that that is metaphysical interpretation and is of absolutely no concrete use in describing the reality of what I did today.

Your guess is close. Over the long term your participation in the market does affect your relative wealth and power. You have more time available to do things that are more productive than making your own pizza, which you may or may not use wisely.

The problem with your argument is that you are trying to isolate "the pizza store down the way" from the market in general. From a macroeconomic perspective there aren't "markets" there is just the market. That market, sans regulation, tends towards monopoly in all things. Whether your goals are the monopolization of wealth and power or not, that is always a part of the market that you are participating in. All you accomplish by not making it your goal is assuring that you will wind up a net loser.

How rapidly, and how harshly, that net loss affects you, and how widespread the suffering of losses is, is a function of regulation. If we, collectively, allow the natural forces of the market to run completely free we encourage those who are pursuing the monopolization of wealth and power, because we allow them to be rewarded for their efforts more easily. Regulation that puts limitations on "it takes money to make money" and "the rich, of course, get richer" need to be encouraged, even if they don't seem "fair" to the rich.

 

[Lexicus]

The problem with your argument is that you are trying to isolate "the pizza store down the way" from the market in general. From a macroeconomic perspective there aren't "markets" there is just the market. That market, sans regulation, tends towards monopoly in all things. Whether your goals are the monopolization of wealth and power or not, that is always a part of the market that you are participating in. All you accomplish by not making it your goal is assuring that you will wind up a net loser.

Actually, I'm not sure that's true, but you're right in that one characteristic of modern society is that there is one integrated 'market'. My point would be though, that lumping everyone's participation in that market such that me going down the street to buy pizza and some dude shorting stock on the trading floor are doing the same thing at some 'deeper' level amounts to theoretical mumbo-jumbo. Now I'm all for theoretical mumbo-jumbo but not when it's superfluous. This, specifically, is theoretical mumbo-jumbo designed to interpret reality in such a way as to keep premises about how the market works and what it means to participate in it intact. That is distinct from theoretical mumbo-jumbo necessary to explain or describe something adequately.

In reality people participate in markets for all kinds of reasons, like I said before, and generalizing about those reasons reduces you to either saying things that are obviously wrong, or saying things that are so vague as to be meaningless.

Similarly, 'the market tends toward monopoly' is a generalization that is simply not accurate. Sectors that are characterized by sufficient economies of scale tend toward monopoly, and sometimes government regulation can in fact foster monopoly by raising prohibitive barriers to entry.

At any rate, I hear a lot about what the market does 'naturally.' In my view there is nothing natural about markets in the first place, and how they work is always the result of factors that are ultimately contingent. The formation of a monopoly is no more 'natural' than the government action used to break it up.

 

[Timsup2nothin]

The only thing different in modern society is the scope of the one integrated market. If we go back far enough we can point to a time when there were multiple markets. Native Americans were definitely participating in a different market than Europeans. Going further back there may have been multiple markets even on the same continent I guess. But at the instant that one person from a market meets a person from another market those markets are integrated. As to whether markets are "natural"...when Eve met Adam the first market was created, because she had something he didn't and he had something she didn't.

On the "generalization" that markets tend towards monopolization...even without significant economies of scale the most effective place to direct one's efforts is into underserved market segments. If there is a shortage of food, produce food is an obvious "way to get ahead." But in the absence of any underserved segment, or a lack of ability to produce in such a segment for whatever reason, the next most efficient way to get ahead is to sharpen one's specialty. Inevitably this leads to concentration of the market segment in question into the hands of "winners." And again, the willingness of a given individual to pursue "getting ahead" is not relevant. As long as anyone is trying to get ahead they will either succeed or fail, and if they succeed the unwilling are falling behind, by definition.

 

[Lexicus]

As to whether markets are "natural"...when Eve met Adam the first market was created, because she had something he didn't and he had something she didn't.

This is just straight-out false (I'm aware you're using Adam and Eve metaphorically). Seriously, I have no idea why people still believe this kind of 18th-century stuff when we have an enormous wealth of information from anthropology and history that directly disproves the claim.

I mean really, study (or just read the wikipedia article) the ethnography of any pre-state culture and you will see a lot of different ways that people exchange goods that have nothing at all to do with markets.

On the "generalization" that markets tend towards monopolization...even without significant economies of scale the most effective place to direct one's efforts is into underserved market segments. If there is a shortage of food, produce food is an obvious "way to get ahead." But in the absence of any underserved segment, or a lack of ability to produce in such a segment for whatever reason, the next most efficient way to get ahead is to sharpen one's specialty. Inevitably this leads to concentration of the market segment in question into the hands of "winners." And again, the willingness of a given individual to pursue "getting ahead" is not relevant. As long as anyone is trying to get ahead they will either succeed or fail, and if they succeed the unwilling are falling behind, by definition.

This needs to be more empirical before I can respond to it. What does this mean in real terms? The fact is that it is not true that all markets tends toward monopoly.

 

[Timsup2nothin]

This is just straight-out false (I'm aware you're using Adam and Eve metaphorically). Seriously, I have no idea why people still believe this kind of 18th-century stuff when we have an enormous wealth of information from anthropology and history that directly disproves the claim.

I mean really, study (or just read the wikipedia article) the ethnography of any pre-state culture and you will see a lot of different ways that people exchange goods that have nothing at all to do with markets.

Just because it seems to be a root difference that is disrupting communication here, could you give me what you are using as the definition of "market"?

 

[Lohrenswald]

It is not expressly un-socialist. Un-socialist would have been balancing the budget and expecting the Depression to resolve itself through workers taking pay cuts.

Socialism means the subordination of market imperatives to some other logic. That logic in turn can be liberal or illiberal, right-wing or left-wing, militaristic or pacifistic.

This is basically like saying that since the opposite of raining is sunny weather, therefore snow is rain (both consist of water so it's not a great example but it's what I could come up with give me a break guys).

Socialism means to get rid of markets, and put production under democratic control of absolutely everyone. The production is then changed to serve the needs of the people, and the commodities made for their own sake, not to gain something else for them (f.ex. car manufacturers today don't want cars, they want to get rid of their cars and get money instead).
It also entails being nice to people.

inb4 Traitorfish comes and invalidates everything I've said :/

 

[Lexicus]

Just because it seems to be a root difference that is disrupting communication here, could you give me what you are using as the definition of "market"?

The economic definition: where supply and demand meet. Obviously not necessarily a physical place, but basically the conceptual "place" in which people buy and sell things.

This is basically like saying that since the opposite of raining is sunny weather, therefore snow is rain (both consist of water so it's not a great example but it's what I could come up with give me a break guys).

No, it's like saying both are precipitation.

Socialism means to get rid of markets

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

and put production under democratic control of absolutely everyone.

Again, disagree. The USSR (and the Third Reich) were socialist yet not democratic at all.

 

[Lohrenswald]

No, it's like saying both are precipitation.

You're wrong, you're conflating the objects of comparison
you are now at fault not for ideological mistakes, but for failing at pattern recognition

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

I'll take the slippery slope and say that that isn't socialism

Again, disagree. The USSR (and the Third Reich) were socialist yet not democratic at all.

SSSR was in the process of achieving a socialistic system, which the western powers kept hindering them.
Also that it was not democratic at all isn't true. You previously critisised Timsup2nogoodinmyneighbourhood (or someone else, don't fully remember) of declaring socialism as an all or nothing, but now here you are doing the same with democracy.

Traitorfish help me

 

[Lexicus]

You're wrong, you're conflating the objects of comparison
you are now at fault not for ideological mistakes, but for failing at pattern recognition

No. What I'm saying is that snow (Nazism, because it's cold, yo) and rain (social democracy) are both forms of precipitation (socialism) which could be fairly said to be the opposite of sunshine (capitalism), but of course sunshine and precipitation can coexist despite being opposites.

I'll take the slippery slope and say that that isn't socialism

Well, I think it is. Who's right?

SSSR was in the process of achieving a socialistic system, which the western powers kept hindering them.

Yes, the standard tanky defense. SSSR established a socialist system and it sucked. It didn't suck because the West made it suck (though they did do everything they could to frustrate it), it sucked because Leninism sucks.

Also that it was not democratic at all isn't true. You previously critisised Timsup2nogoodinmyneighbourhood (or someone else, don't fully remember) of declaring socialism as an all or nothing, but now here you are doing the same with democracy.

Actually, it's not the same thing. I don't believe democracy is an all-or-nothing proposition. I may be wrong about the extent to which the SSSR was democratic, but that would not be the same as declaring democracy all-or-nothing.

 

[Timsup2nothin]

The economic definition: where supply and demand meet. Obviously not necessarily a physical place, but basically the conceptual "place" in which people buy and sell things.

Okay...so, in my view that is like when a physicist is talking to a layman and they ask "so what is fission?" and the physicist says "the nucleus splits." How about we go with a more economists definition, like: A market is one of the many varieties of systems, institutions, procedures, social relations and infrastructures whereby parties engage in exchange.

Basically, this is the same thing you said, in that "the market" is the intersection of ALL supply and ALL demand. It has literally nothing to do with a physical space, or even with physical space. "Goods" get exchanged, and the market is the medium of that exchange. The "economic system" is the rules which govern that exchange.

So, ultimately, any exchanging of goods that you do, be that dollars for pizzas, labor for dollars, sex for shelter, cooking for internet access, whatever, is participation in the market and is conducted under the rules of the economic system. And we ALL want "a good deal." Whether we want maximum dollars for our labor, the most pizza of the best quality for our dollar, enjoyment along with shelter for the sex, or longer term internet access for each meal prepared, we want a good deal.

And if the economic system doesn't actively prevent it that desire for good deals, over time, will lead to people leveraging one good deal into the where with all to get an even better deal giving them access to even better deals ad infinitum.

 

[Lexicus]

Okay...so, in my view that is like when a physicist is talking to a layman and they ask "so what is fission?" and the physicist says "the nucleus splits." How about we go with a more economists definition, like: A market is one of the many varieties of systems, institutions, procedures, social relations and infrastructures whereby parties engage in exchange.

Plagiarized from the wikipedia article, I can tell

Basically, this is the same thing you said, in that "the market" is the intersection of ALL supply and ALL demand. It has literally nothing to do with a physical space, or even with physical space. "Goods" get exchanged, and the market is the medium of that exchange. The "economic system" is the rules which govern that exchange.

Correct.

So, ultimately, any exchanging of goods that you do, be that dollars for pizzas, labor for dollars, sex for shelter, cooking for internet access, whatever, is participation in the market and is conducted under the rules of the economic system. And we ALL want "a good deal." Whether we want maximum dollars for our labor, the most pizza of the best quality for our dollar, enjoyment along with shelter for the sex, or longer term internet access for each meal prepared, we want a good deal.

And if the economic system doesn't actively prevent it that desire for good deals, over time, will lead to people leveraging one good deal into the where with all to get an even better deal giving them access to even better deals ad infinitum.

So here is where you're wrong. Well, not wrong about how markets work, but you are wrong in that market exchange is only one kind of exchange. There are kinds of exchange that have absolutely nothing to do with the market. You are concerned with only one particular type of exchange (buying and selling, or exchange for gain) that is what we use "markets" to describe, but exchange is much more broad than that. Your parents giving you presents for your birthday is a form of non-market exchange. The government giving you a social security check is a form of non-market exchange.

This is why I said you should take a look at some of the ethnography of societies that are very different from our own. You will see all kinds of exchange the goal of which is not "to get a good deal".

Some good examples would be the ancient civilizations of Egypt and Sumer - these were highly complex literate societies where buying and selling goods played almost no role in the economic system. Instead hugely complex bureaucracies developed around palaces and temples, and these administered rationing systems where equivalencies between goods (a weight of silver and an amount of wheat, for example) were determined by edict rather than by buyers and sellers interacting in a market.

 

[uppi]

One, Piketty's argument (that's who you're lifting this from) is that if return on capital ownership over the longer term - like, multiple generations - is greater than the rate of economic growth over the same period, then inheritance will predominate over income as a method of wealth accumulation. The mere possibility of earning a return on investment greater than economic growth guarantees nothing.

Inheritance is not a method of wealth accumulation, because it only transfers wealth. The capital return accumulates wealth, no matter who controls the capital. As long as the capital and the possibility of investment is there, someone will try to take advantage of it.

Even if those conditions are satisfied, that says nothing about the 'certainty' (much less the 'mathematical certainty'!) of concentration of wealth, because 1) people can concentrate wealth through other means and 2) there are plenty of potential countervailing forces that can prevent wealth from becoming concentrated even given the conditions Piketty lays out there. Like, for example, a robustly progressive taxation regime (which Piketty argues for in his book!) could counteract this and prevent too much concentration of wealth.

1) What other legal means are there? If you have no access to capital, you have no chance to concentrate wealth. If you have very little capital, you might be able to find opportunities with a huge return of investment, but those are rare.
2) Of course you can introduce measures against the concentration of wealth, but those are never market based. The necessity these measures just shows that the market fails at distributing wealth
.

In any case, this argument isn't actually a refutation of mine, even if it were correct, because you still would need to show that those conditions which led to the 'mathematical certainty' of wealth concentration sprang 'naturally' from markets - a very tall order.

For this, I'll just point to empirical evidence from history: Whenever there was a somewhat free and stable market, wealth was concentrated. Redistribution was always a result of external forces.

 

[Lexicus]

Inheritance is not a method of wealth accumulation, because it only transfers wealth. The capital return accumulates wealth, no matter who controls the capital. As long as the capital and the possibility of investment is there, someone will try to take advantage of it.

Er, capital return also just 'transfers wealth.' Wealth concentration is nothing but the transfer of wealth to those who already have lots of it.

1) What other legal means are there? If you have no access to capital, you have no chance to concentrate wealth. If you have very little capital, you might be able to find opportunities with a huge return of investment, but those are rare.
2) Of course you can introduce measures against the concentration of wealth, but those are never market based. The necessity these measures just shows that the market fails at distributing wealth

The market doesn't ever distribute wealth on its own, is my whole point.

For this, I'll just point to empirical evidence from history: Whenever there was a somewhat free and stable market, wealth was concentrated. Redistribution was always a result of external forces.

This is largely interpretive, not empirical. I also don't think it's true. Free and stable markets lead to wealth being distributed equitably. It's rigged and chaotic markets that lead to vast concentrations of wealth.

 

[uppi]

Er, capital return also just 'transfers wealth.' Wealth concentration is nothing but the transfer of wealth to those who already have lots of it.

Inheritance transfers wealth to people who do not already have lots of it.

This is largely interpretive, not empirical. I also don't think it's true. Free and stable markets lead to wealth being distributed equitably. It's rigged and chaotic markets that lead to vast concentrations of wealth.

Can you point to any market in history that has lead to an equitable distribution of wealth? There are plenty of examples for the opposite.