.... is it? I always here capitalism thrown around likes it's the black plague and wanted to know why. Why is capitalism so evil? What makes this economic system worse than others? Speak up all you malcontents, inquiring minds want to know? 
Evil Capitalism
- Thread starter BuddhaRoadkill
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Capitalism is the love of money incarnate. It requires an underclass to function, it places monetary value on everything, it does not care about people or their well-being...
How much do you know about capitalism and the alternatives?
How much do you know about capitalism and the alternatives?
And today is the first day of the Capitalist Shopping Orgy month. 
There's nothing inherently wrong with capitalism. It does have deleterious effects when it's practiced unbridled. Most of what people call "capitalism" would have Adam Smith rolling over in his grave.
So, it depends what you're talking about, really. Are you referring to the economic ideas, or are you referring to the way it's currently practised in the US?
So, it depends what you're talking about, really. Are you referring to the economic ideas, or are you referring to the way it's currently practised in the US?
Our version of capitolism sucks because we are not a free market society, and our leaders are more than willing to subsidize corporations.
ummbikes said:
WORD!. capitalism as a concept is the best among the available IMO. its not perfect, but its better or more realistic than others at least.
i got a problem with the free markets ad free trade.
am all for them. but... if you allow free capital flows... shouldnt you also allow free labor flow????
because otherwise, isnt allowing free capital flows, but constraining certain people to certain geographic locations the same as constraining some people to ALWAYS be part of the cheap labor.
not allowing this people to freely move their labor to wherever they want (by impossing tight inmigration laws in highly paid labor places) is against free trade AND is a way to keep them in the lower class forever????
ALEXIS_DH said:
I think I see what your are saying. The problem the established system has with free flow of labor is that it allows the labor force to have too much control over potential profits, by allowing the workers to simply move to better paying employer across national boundries.
This is a major probelm for the neo-con/fascist model, because they are counting on having very tight control of labor, and the might of armies to enforce market controls.
So it really all boils down to the social -vs- capitol model fight of the last 100 years...
Let The Comunist Revolution Begin!!!!!!!
Nah, lets not.TheMontashu said:
Let's try letting corporations floating their own boats instead of subsidizing them and call it good.
deal.
ummbikes said:I think I see what your are saying. The problem the established system has with free flow of labor is that it allows the labor force to have too much control over potential profits, by allowing the workers to simply move to better paying employer across national boundries.
This is a major probelm for the neo-con/fascist model, because they are counting on having very tight control of labor, and the might of armies to enforce market controls.
So it really all boils down to the social -vs- capitol model fight of the last 100 years...
yup, for me the perfect system would be that. a system of free capital flows AND free labor flows, in which neither of them has a total grip, but a constant struggle.
much more realistic than a utopic socialism, but the only problem is convincing the ones now with the grip to loosen a little bit so the free-labor-flows can move wherever.
i think globalization is a first step towards that. eventually people will realize that free inmigrations are needed and are fair once you open borders for capitals...
Even after all the bitching about capitalism in its current state, you cannot convince me that a man with any amount of work ethic and no serious substance abuse issues will go hungry in this country. The vast majority are able to live at a much more comfortable level than have the poor at any other time in history. People just want to work less for more in this world regardless of whether they're CEOs or Janitors.
BurlyShirley said:
dude, people will always want to work less for more money. its not having a bad work ethic, is a basic market rule.
the same thing as wanting the most for your money. you want the most money out of your labor. no bad ethics in there. bad ethics is what the guy with a whip making you work wants you to think so you dont slack off, so he gets the most for his money, not you the most for your labor...
Right. Im just saying that's why people bitch about capitalisim, even though "people" as a whole never had it so good.ALEXIS_DH said:
Burly, the question is this, is the damn CEO really worth 9 million more a year than the dude who makes the airplane? Espescially when the CEO gets beaux-coup tax breaks and fat government checks too?
Hell I'm all for making money, and I have no problem making my employer money, I just would generally like more for what I do and some medical insurance would be nice too.
Hell I'm all for making money, and I have no problem making my employer money, I just would generally like more for what I do and some medical insurance would be nice too.
the concept is the best available. yet in its application everyone can bitch a lot about it.. because its still faaaaaaaaaaaar from the true free-market free-trade.. what we have now its not capitalism... is the same ol´ oligarchy masqueraded under a new freedom and human rights costume.BurlyShirley said:
ummbikes said:
there is where the current version of capitalism fails... there is no true labor VS capital war there... the capital has way too much power over you for you to get more for your labor..
and the corruption is what makes the CEO gets more bucks....
corporate boardrooms across america are stocked with the same cast of characters, who go on to appoint each other to cozy board positions at other companies. this incestuous cycle represents cronyism of the worst kind, and is nothing like pure capitalism as envisioned by, say, ayn rand.
The CEO is worth more for the same reason that the doctor is worth more than the construction worker, even though the construction worker will physically work harder over a lifetime. It's about responsibility and the comptency that is required. Not that its always necessarily delivered, though.ummbikes said:
You'd like medical insurance, and people in Burundi would like some food and a break from the biting flies. Pick your poison. For all the "bad" that corporations do, companies like Wal Mart and Bass Pro shops make "the finer things in life" more accessible to the rednecks.
Not saying the system is perfect, but it works.
Toshi said:
thats in capitalism without competition.
when corporation dont compete, but join to stiff the people. its the very delicate difference between the utopic competition-capitalism, in which the gvmt is the policeman to prevent this and the ol´ oligarchy-corruption-capitalism we have had in SA forever....
BurlyShirley said:
there is a limit for that Burly. in an open market, the doctor worth will be dependant upon the number of people capable. the problem with CEOS is that at that level corporations run pretty much like closed mafias... not much competition, why??, because keeping the same CEOS always guarantees certain power to certain shareholders, rather than benefits for ALL sharedholders. the same as in the world, but at a small corporate level.
two reasons why this is wrong:BurlyShirley said:
1) the process of becoming a physician is egalitarian (to sometimes disgusting lengths), and somewhat of a meritocracy as well
2) 4 yrs of med school + ~4 years of residency at essentially minimum wage (figure $40k/yr at 80-88+ hours/week during residency) is a lot more effort than a posh mba program, that you could go through at night if you wanted, yet physicians are paid on the much less than ceos of "major corporations", whatever that definition is. $9.2 million dollars.
the path to money is in business, not medicine. like i wrote, boardrooms are populated through cronyism. that's not capitalism.
well, I didnt mean for you to take that example so literally, but figure that responsibility for money = salary level, with some regularity. You know that. And you know thats why CEOs make so much.Toshi said:
and my point is that CEO compensation is way out of line with reality, based on the above criteria. even when they screw up, they get nice severance packages. furthermore, their performance isn't judged by their responsibility, but rather on how much they can slash and burn in order to increase short term gain for the shareholders.BurlyShirley said:
If I were going out of town, Id pick someone I could trust to watch my dog, not a homeless bum off the street who might eat it.ALEXIS_DH said:
BurlyShirley said:
but what about if you own 1/3 of the dog, and a friend of yours owns the other 1/3, and a nother guy out of town owns the other 1/3... would you get the guy you trust?
or the guy that will give make your teacup toy poodle give birth twins in 2 weeks... but can eventually kill the dog... of course after you and your buiddy got one of the puppies, and sold your 1/3 of the post-partum poodile to some poor soul????
You're only looking at the negative of this, as positives can also create gains for shareholders. Growing businesses, healthy ones, are great for shareholders. Its not all slashing 10,000 jobs the day before Christmas.Toshi said:
Again, dont take the examples so literally, or we'll end up bickering about dog breeding in a minute, but, if my dog were a business, of course, Id go with the guy most likely to better my business in whatever ways possible. It'd sure be a plus if I knew him well and wasnt just some resume who might be a serial dog assraper.ALEXIS_DH said:
BS, a little homework.
Compare CEO compensation (maybe compared to the lowest paid employee in the firm, or whatever fits your fancy) in the the US and Japan.
Anything interesting come up there? Anything at all?
Compare CEO compensation (maybe compared to the lowest paid employee in the firm, or whatever fits your fancy) in the the US and Japan.
Anything interesting come up there? Anything at all?
So are we just going to turn this into a debate about CEO compensation, cause we had one of those already.Silver said:
No, I'm asking you to do a little research and challenge your preconceived notions that CEO compensation in the US is economically justified by comparing and contrasting to other first world economies. You can throw most of the EU in there too, since you're being dense again.
"People" as a whole meaning the US, or the entire world? Given that the US has become the ruling class and outsourced its proletariat to the third world people may not have never had it so good.BurlyShirley said:
Capitalism is the best available system and works like a charm. The problem (which is currently being addressed, and is agreed upon across political parties, not including the presidency) is that true capitalism requires that you are both rewarded for your successes and punished for your failures.BurlyShirley said:
Right now, executive level managers are entirely insulated from any punishment for failure. In fact, many have been consistently REWARDED for failures. The key is striking a balance between allowing execs to take the risks that drive innovation and growth, while still holding them accountable for selfish decisions that hurt the company as a whole. Finding that balance is not easy, but right now there's a clear imbalance towards protection. A good start would be for corporations themselves to take some responsibility for the mess and base bonuses on something like NPV or cash flow, rather than quarterly or total shareholder return. C-level needs more incentive towards acting in the best interest of the company, not just themselves and their 3 wealthiest friends.
And Burly, I value your positions on morality (seriously), foreign policy, and social issues... but on this one, you just don't know what you're talking about.
Ohio, Silver....whoa, that kind of sounds like Hiho Silver, huh?
Anyway, Im not defending CEOs here. Im not saying that what is going on is right in every way. I didnt make that statement and Im not trying to defend it. So to say "you dont know what you're talking about" isnt entirely accurate, because that's not even what Im talking about.
All Im getting at is that the system aint all bad and Evil as people try to make it out to be. The leadership in some aspects may be "corrupt" in our minds, but the overall effects of this quasi-capitalism we have, have been pretty good as compared to the alternative.
Anyway, Im not defending CEOs here. Im not saying that what is going on is right in every way. I didnt make that statement and Im not trying to defend it. So to say "you dont know what you're talking about" isnt entirely accurate, because that's not even what Im talking about.
All Im getting at is that the system aint all bad and Evil as people try to make it out to be. The leadership in some aspects may be "corrupt" in our minds, but the overall effects of this quasi-capitalism we have, have been pretty good as compared to the alternative.
No the system isn't, but the people are. Most people (not just CEOs) given access to millions of dollars at the expense of others (including shareholders and taxpayers), will take it unless there is some incentive (besides morals) to not do so.BurlyShirley said:
We agree that it's a great system with a few flaws. Where we disagree is that you seem to be perfectly willing to accept the flaws. You should try to do something about them so that we achieve a better system.
ohio said:
I just didnt think we'd gone that far in the argument yet. As said before, I was just arguing that capitalism itself isnt bad and operates fairly well given the alternatives when asked the question of "Is Capitalism Evil" or whatever. But as for improving it all, is there some federal regulation you'd care to pass, or should the shareholders themselves make the rules for their own money? Im inclined to choose the latter, but then again, I dont invest....at least in corporations per se. I just buy land and am going to put immigrant worker trailer parks on it, but anyway, what's your solution?
The real failure, at least in terms of the recent accounting fiascos, was the audits. The auditors quit doing their jobs. That was always one of the "incentives " to not manipulate the system, you'd get caught. However, either thru ommission, incompetence or (insert the word for being in on it) that fell thru.ohio said:
As for picking the right measure for bonus basis.... companies are only going to drive the indicators and measures that shareholders and analysts hold important. Where it be NPV, CFROI, shareholder value, profit, sales.... they are all open to manipulation which again points to the necessity of having independent and through financial audits.
As for CEO compenstation, what's too high? Do you say 10% of the lowest paid employee as Ben and Jerry's TRIED to do or some other number? What is the standard to set? As with most things in the capitalist system it gets driven by the market. That market will correct typically if it gets too out of whack. Which in essence is what is happening now. I would not expect to ever see it fall substanially but it certainly won't be the Eisner / Ovitz kinda money.
I don't see a need to cap CEO compensation, nor do I have a problem with it being 100x of the lowest employee's wages. If the board is properly incentivized or held accountable, then there's probably a good reason that CEO is being paid that much. It's supply and demand at the exec level too, and companies pay what is necessary to attract top talentDRB said:
My problem is bonuses being awarded despite underperformance or sometimes even fraud. Right now, most public companies are addressing this by restructuring their charters so they don't screw themselves. As for legislation that will help, as you said, much of the work needs to be with accounting practices. That is in process. I'm no lawyer, but here's my take on what else needs to happen.
1. Non exec employee pensions should be the primary creditor in the case of liquidation/bankruptcy
2. Executive salary and bonus obligations should be treated as accounts payable. I'm not sure what teir of creditor that should be at, but below non-exec employee pensions.
3. Stiffer penalities for white-collar crime. These crimes are not always clear cut, but someone that rips their company off for $1 million, should get an equal penalty to someone that steals (non-violently) $1 million worth of cars.