Do trickle-down economic theories work?

[freeRadical]

We have a a true capitalist society. How’s that working for you? OK, actually it is a plutocracy and an oiligarchy [sic]. And Somalia is a good example of Libertarian capitalism. Statistically, the poor support the poor, giving proportionally way more to charity than the rich. And all the very rich would have to do to “give” charitably is to pay a living wage. Do they? It is in the deep interest of crapitalim to have masses of poor competing for low paying jobs. Why do you think there were deadly wage riots and unions formed in our history? Was it because capitalism is in the interest of wage earners?

If you are referring to the US, then you are wrong. The US is not a true capitalist society and never was. There has never been a true capitalist society on this planet, ever. Somalia is a good example were there is no rule of law. You can’t have a capitalist society without rule of law and a government that enforces property rights, contracts, and protects people from other people.

 

[LeafByNiggle]

If you are referring to the US, then you are wrong. The US is not a true capitalist society and never was. There has never been a true capitalist society on this planet, ever. Somalia is a good example were there is no rule of law. You can’t have a capitalist society without rule of law and a government that enforces property rights, contracts, and protects people from other people.

If capitalism, according to you, has never really existed on this planet, how do know for a fact that it is such a good thing?

 

[freeRadical]

If capitalism, according to you, has never really existed on this planet, how do know for a fact that it is such a good thing?

How do you know its such a bad thing?

 

[nmgauss]

The US is not a true capitalist society and never was. There has never been a true capitalist society on this planet, ever.

Capitalism is an economic system in which trade, industry, and the means of production are controlled by private owners with the goal of making profits in a market economy. Central characteristics of capitalism include capital accumulation, competitive markets and wage labor. In a capitalist economy, the parties to a transaction typically determine the prices at which assets, goods, and services are exchanged.
en.wikipedia.org/wiki/Capitalism

Using this definition of capitalism, it was practiced at the dawn of western civilization. It was put into practice by the Massachusetts Bay Colony.

 

[jeannetherese]

Capitalism is an economic system in which trade, industry, and the means of production are controlled by private owners with the goal of making profits in a market economy. Central characteristics of capitalism include capital accumulation, competitive markets and wage labor. In a capitalist economy, the parties to a transaction typically determine the prices at which assets, goods, and services are exchanged.
en.wikipedia.org/wiki/Capitalism

Using this definition of capitalism, it was practiced at the dawn of western civilization. It was put into practice by the Massachusetts Bay Colony.

Do you consider slavery compatible with this definition of capitalism? How might that fit into the mention of the dawn of western civilization? Is an economy which relies to some extent upon slave labor capitalistic or mixed?
Would you mind expanding a bit about capitalism and the Massachusetts Bay Colony?
Thank you so much.
jt

 

[LeafByNiggle]

How do you know its such a bad thing?

OK, we can just agree that it is an unknown.

 

[freeRadical]

OK, we can just agree that it is an unknown.

Just out of curiosity, if you think Capitalism is bad, what economic system would you replace it with?

 

[freeRadical]

Capitalism is an economic system in which trade, industry, and the means of production are controlled by private owners with the goal of making profits in a market economy. Central characteristics of capitalism include capital accumulation, competitive markets and wage labor. In a capitalist economy, the parties to a transaction typically determine the prices at which assets, goods, and services are exchanged.
en.wikipedia.org/wiki/Capitalism

Using this definition of capitalism, it was practiced at the dawn of western civilization. It was put into practice by the Massachusetts Bay Colony.

The Massachusetts Bay Colony is not the dawn of western civilization.

 

[nmgauss]

Do you consider slavery compatible with this definition of capitalism? How might that fit into the mention of the dawn of western civilization? Is an economy which relies to some extent upon slave labor capitalistic or mixed?
Would you mind expanding a bit about capitalism and the Massachusetts Bay Colony?
Thank you so much.
jt

Slaves were considered livestock. They could be fed, housed, bought and sold just like horses. Slaves did not earn a wage, and neither did horses.

In the early years of the Massachusetts Bay Colony, it was highly dependent on the import of staples from England, and was supported by the investments of a number of wealthy immigrants. Certain businesses, notably shipbuilding, fisheries, and the fur and lumber trades, quickly got started. As early as 1632 ships built in the colony began trading, either with other colonies, England, or foreign ports in Europe.

 

[Zoltan_Cobalt]

We have a a true capitalist society. How’s that working for you?

Not very well…because we do not have a true Capitalist society today.

OK, actually it is a plutocracy and an oiligarchy [sic].

So…what is it? a Free Market, a plutocracy or an oiligarchy???
When you figure it out, let us know. Until then be assured it is not true Capitalism.

It is in the deep interest of crapitalim to have masses of poor competing for low paying jobs. Why do you think there were deadly wage riots and unions formed in our history? Was it because capitalism is in the interest of wage earners?

Only a government can keep masses of poor competing for low paying jobs. It’s called wage and price controls.

The “wage riots” were incited by greedy union bosses who convinced greedy workers that they should be paid more for less work.

Capitalism is not a social program. It does not operate for the interest of wage earners. However wage earners do better in a true Capitalist economy, they have no lay-offs, have a full employment rate and enjoy a higher standard of living.

 

[LeafByNiggle]

However wage earners do better in a true Capitalist economy, they have no lay-offs, have a full employment rate and enjoy a higher standard of living.

Is that wishful thinking, or is it supportable by evidence? Either show a “true Capitalist economy” where everyone has employment, or point to something structural in the definition of true Capitalism that ensures full employment.

 

[Zoltan_Cobalt]

Is that wishful thinking, or is it supportable by evidence? Either show a “true Capitalist economy” where everyone has employment, or point to something structural in the definition of true Capitalism that ensures full employment.

Oh, goodie! A challenge. I crave challenges.

All the supportive evidence is right there in HISTORY.

As I have said before there has never been really true, hard core, lassie faire Capitalism. The closest we have ever come is the United States from the early 1800’s up to the Sherman Anti Trust Act. Britain was a close second during the Industrial Revolution, but the U.S. excelled because of a greater element of freedom.

Capitalism’s moral nature nor even its political principles have ever been fully understood or defined. Even some defenders regarded it as compatible with government controls (i.e., government interference into the economy), ignoring the meaning and implications of the concept of laissez-faire. Thus, what existed in practice, in the nineteenth century, was not pure Capitalism, but variously mixed economies. Since controls breed further controls, it was the statist element of the mixtures that wrecked the economy; it was the free, Capitalist element that took the blame.

The flood of misinformation, misrepresentation, distortion, and outright falsehood about capitalism is such that the young people of today have no idea (and virtually no way of discovering any idea) of its actual nature.

Capitalism has created the highest standard of living ever known on earth. The evidence is incontrovertible. Remember the contrast between West and East Berlin before the “Wall” was torn down? That is like like a laboratory experiment for all to see.

 

[nmgauss]

Not very well…because we do not have a true Capitalist society today.

Is that because there are government controls of the flow of capital?

So…what is it? a Free Market, a plutocracy or an oiligarchy???
When you figure it out, let us know. Until then be assured it is not true Capitalism.

Plutocracy and Oligarchy are forms of government. Capitalism is an economic system. Please don’t confuse the two.

The “wage riots” were incited by greedy union bosses who convinced greedy workers that they should be paid more for less work.

And when our high tariffs inflated the cost of imported goods, the products made by these greedy workers could be sold to a captive American market. This worked fine until a global economy was established whereby the market was no longer captive.

Capitalism is not a social program. It does not operate for the interest of wage earners. However wage earners do better in a true Capitalist economy, they have no lay-offs, have a full employment rate and enjoy a higher standard of living.

Lay-offs will always occur because of variations in the markets. If the market for a product declines, companies can no longer afford to have excess workers.

 

[Zoltan_Cobalt]

Is that because there are government controls of the flow of capital?

I was using the word “Capitalism” in reference to the Free Market. (Something I do not like to do…sorry)

To answer your question…yes. There are government controls that limit the banking and financial industries and therefore limit the flow of capital.

Plutocracy and Oligarchy are forms of government. Capitalism is an economic system. Please don’t confuse the two.

Tell that to Sochi. He is the one who is confused.

And when our high tariffs inflated the cost of imported goods, the products made by these greedy workers could be sold to a captive American market. This worked fine until a global economy was established whereby the market was no longer captive.

OK, so is that good or bad?

Lay-offs will always occur because of variations in the markets. If the market for a product declines, companies can no longer afford to have excess workers.

In a true pure Capitalistic society there would be far fewer variations in the market and those would be for the good. So few . if any lay-offs. Companies unable to compete with new and better ideas actually provide the needed labor force to the new competitors.

 

[LeafByNiggle]

…Capitalism has created the highest standard of living ever known on earth. The evidence is incontrovertible. Remember the contrast between West and East Berlin before the “Wall” was torn down? That is like like a laboratory experiment for all to see.

I wasn’t challenging the “highest standard of living” claim. I was challenging the “full employment” claim. So where is the evidence for that particular claim?

 

[sallybutler]

Oh, goodie! A challenge. I crave challenges.

All the supportive evidence is right there in HISTORY.

As I have said before there has never been really true, hard core, lassie faire Capitalism. The closest we have ever come is the United States from the early 1800’s up to the Sherman Anti Trust Act. Britain was a close second during the Industrial Revolution, but the U.S. excelled because of a greater element of freedom.

Capitalism’s moral nature nor even its political principles have ever been fully understood or defined. Even some defenders regarded it as compatible with government controls (i.e., government interference into the economy), ignoring the meaning and implications of the concept of laissez-faire. Thus, what existed in practice, in the nineteenth century, was not pure Capitalism, but variously mixed economies. Since controls breed further controls, it was the statist element of the mixtures that wrecked the economy; it was the free, Capitalist element that took the blame.

The flood of misinformation, misrepresentation, distortion, and outright falsehood about capitalism is such that the young people of today have no idea (and virtually no way of discovering any idea) of its actual nature.

Capitalism has created the highest standard of living ever known on earth. The evidence is incontrovertible. Remember the contrast between West and East Berlin before the “Wall” was torn down? That is like like a laboratory experiment for all to see.

The problem with using the US from 1800 to 1890 as a model for a free market is that during that period we had

1. slavery – aka people not allowed to bargin or trade their labor
2. the granting of huge amounts of free land to railroads by the government
   ( elawreview.org/elaw/383/the_shifting_sands_of_property.html )
3. The Pacific Telegraph Act, which was an act where the government paid a company to build a transcontinental line.

These suggest that the free market in the 1800’s depended a lot on government investement in addition to non-governmental investment.

 

[Zoltan_Cobalt]

The problem with using the US from 1800 to 1890 as a model for a free market is that during that period we had

1. slavery – aka people not allowed to bargin or trade their labor
2. the granting of huge amounts of free land to railroads by the government
   ( elawreview.org/elaw/383/the_shifting_sands_of_property.html )
3. The Pacific Telegraph Act, which was an act where the government paid a company to build a transcontinental line.

These suggest that the free market in the 1800’s depended a lot on government investement in addition to non-governmental investment.

1. Slavery.
   The U.S. is the only country in the history of the world to fight a war over slavery. It was the agrarian, feudal South that maintained slavery. It was the industrial, capitalistic North that wiped it out.
2. Railroads.
   Many historians have claimed that the great railroads of the late 19th and early 20th centuries could not have been built without government subsidies. However, the entire British railroad system was built with private funds, and the Great Northern Railroad under James J. Hill was a private transcontinental company that prospered when government-funded companies were going under.
   To learn why government should NOT have been involved in Railroads see: waltercoffey.wordpress.com/2013/01/17/corruption-and-the-transcontinental-railroad/
3. The Pacific Telegraph Act
   A perfect example of what happens when the government supports an industry. The Pacific Telegraph Act was the forerunner of NET NEUTRALITY.

Just one of the little government regulations from the act:

. “messages received from any individual, company, or corporation, or from any telegraph lines connecting with this line at either of its termini, shall be impartially transmitted in the order of their reception, **excepting that the dispatches of the government shall have priority. . .” **

 

[sallybutler]

1. Slavery.
   The U.S. is the only country in the history of the world to fight a war over slavery. It was the agrarian, feudal South that maintained slavery. It was the industrial, capitalistic North that wiped it out.
2. Railroads.
   Many historians have claimed that the great railroads of the late 19th and early 20th centuries could not have been built without government subsidies. However, the entire British railroad system was built with private funds, and the Great Northern Railroad under James J. Hill was a private transcontinental company that prospered when government-funded companies were going under.
   To learn why government should NOT have been involved in Railroads see: waltercoffey.wordpress.com/2013/01/17/corruption-and-the-transcontinental-railroad/
3. The Pacific Telegraph Act
   A perfect example of what happens when the government supports an industry. The Pacific Telegraph Act was the forerunner of NET NEUTRALITY.

Just one of the little government regulations from the act:

. “messages received from any individual, company, or corporation, or from any telegraph lines connecting with this line at either of its termini, shall be impartially transmitted in the order of their reception, **excepting that the dispatches of the government shall have priority. . .” **

So, are you for or against government intervention?

 

[Zoltan_Cobalt]

So, are you for or against government intervention?

Good Grief, Sally…

Have you NOT read any of my other posts???

The only proper functions of a government are: the police, to protect you from criminals; the military, to protect you from foreign invaders; and the courts, to protect your property and contracts from breach or fraud by others, to settle disputes by rational rules, according to objective law.

I am FIRMLY against government intervention in anything other than the above.

 

[sallybutler]

Good Grief, Sally…

Have you NOT read any of my other posts???

The only proper functions of a government are: the police, to protect you from criminals; the military, to protect you from foreign invaders; and the courts, to protect your property and contracts from breach or fraud by others, to settle disputes by rational rules, according to objective law.

I am FIRMLY against government intervention in anything other than the above.

I get that you do not believe in government intervention. But it sounded like you thought getting rid of slavery was a good example of government intervention, as was the Telegraph Act. You seemed to think the British approach to railroads was better than the our approach(although the British government did impose regulations that required the railroads to provide affordable fares aka third class), which is why I am confused. Unless you think the government should not have ended slavery or helped the railroads and communication industries.