So now, please argue against the philosophy rather than the history.

TheGhostmaker: "there is no real capitalism in the real world"

So why are we talking about how much better it is than everything else?... might as well be talking about how awesome communism as envisioned by Engels and Marx's... after all, their pure form of communism has also never been seen in the real world.

You don't necessarily need empirical evidence to see that one thing is good and another bad. Capitalism works in theory, according to the theory we have today. Marxism does not work in theory, if you are good enough at the theory to realise that human instinct is as it is.

@TheGhostmaker, what better way to judge a philosophy than through the study of it's application? ...through history? History is the testing ground. Capitalism is better than feudalism (congratulations)... and is better in most ways than communism (congratulations again). History also shows that it is deeply flawed never the less (at least in it's purest form) and has a very deeply inhumane side to it (much like feudalism) and a short-sightedness driven by individual greed, corruption, and quarterly reports as well as failing completely to handle public goods and common goods. How can we discuss political/economic philosophy divorced from it's real-world application? (And why would we want to?)

It has had no real world application.

Empirical evidence trumps gut-feeling every time. That is true for science... and if economists claim (as they do) that their field of study is a science, then the same is true for economic theory.

And, human instinct as it is, also dooms pure capitalism from the start. (see again references to public good and common good - which, by the way, at least communism tries valiantly to address).

It has had no real world application.

Ghostmaker: "It has had no real world application"
- that would be, I assert, because it would be impossible to apply it in pure form. Somalia is the closest modern example... (and the Cato Institute loves the Somalia model - amazing... kind of like communists talking up Pol Pot).

Somalia suffers from lawlessness, something that free market capitalism doesn't involve.

"A shorter Crispminis: morality arose for practical purposes (pragmatism) yet taxes are immoral and government (paid for by taxes) is a practical measure. Ironic indeed. :-)"

Haha, it's not logically inconsistent though. My view is that morality is for a large part in our genetic nature as a result of evolution, which promoted it because of it's practicality. I think for most people I think morality is pretty intuitive. It's extremely difficult to come up with a logically consistent view of morality that cannot be punctured with a simple example in which the action that should be taken seems so obviously and intuitively immoral. To be clear, morality developed out of pragmatism. The intuitive sense of morality we're given often clashes with pragmatism, and a great many things anyways. My intuitive sense of morality tells me that taxes are immoral because it involves the forcible taking of my estate.

Dr. Oct, the immorality lies in that taxation is forcible. I was merely pointing out as a side point that for many people they pay far more than they value the services given by government. This is inherent because more government money comes from richer people, and more government money (by proportion) goes to poorer people. People pay more or less for the same services when you're taxed, and for some this is a sweet deal, for others it is not.

Ayn Rand is a decent author. I don't find her particularly talented or terrible in her writing, though she's quite long winded. Objectivism is an interesting philosophy, but I think it attributes too much morality to capitalism and it's just philosophical justification for selfishness (which is not inherently bad).

I think it's interesting to see that people think that we're being held back by capitalism.

"The central problem with capitalism is that whilst, in theory, through a combination of skill and luck, almost ANYONE could become rich. This does not mean that EVERYONE can become rich."

Of course not. It's a little thing we like to call scarcity. If scarcity didn't exist, economic ideology would be a moot point because we could all roll around in riches, though this would be short-lived. With scarcity, under no economic ideology ever could everyone be rich. But then, you shouldn't ask what makes people poor, you have to ask what makes people wealthy. It's not the natural state for everyone to have a set amount of wealth from which some people take some from others leaving a rich and a poor class... the natural state is quite simply poverty. If nobody does anything, everyone is poor. Quite simply, capitalism is the most effective mechanism by which we generate wealth. There is a problem with the distribution of such wealth, but for the most part, the wealth goes to those who were the most responsible in creating that wealth. If you force those who generate wealth to give it up for those who don't, you're killing the goose that lays the golden egg. They're not even your eggs to start with. =/

"It is interesting to me how in U.S. law a corporation is in most respects considered "a person"... and yet the corporation's only responsibility is for maximizing profit. Imagine for a moment if that was a standard that we applied to actual people. Imagine if all society expected individuals to do was to maximize their profit. Maybe that is a libertarian utopia... but it sounds like hell to me."

No, no. Individuals maximize utility, not fiscal profit. You maximize the things that make you feel good and the things you feel you should do. It's a very broad term, and to be honest, by simple tautology it is true. It's not just a capitalist term though, it's an economic term in general, and a very, very common assumption.

"However, you are wrong, I think, to place the blame on the welfare system. What the US government should do is not reduce welfare, but raise the minimum wage to a living wage level. Then Wal Mart, and other firms, would not have the option of paying such low wages."

Bad idea. Minimum wage legislation is a bad idea. Certain labour has a certain market worth. If you force companies to pay more than they should for labour, what happens? They employ less workers and have them work more so that their labour is worth more. This leads to overworking and unemployment. While a certain level of unemployment usually exists in the adolescent demographic, minimum wage has raised this unemployment because it is unskilled workers who lose out on employment when companies are forced to pay their workers more than their labour is worth.

"Just to continue: I read in today's newspaper that the football (soccer) player Gareth Barry, who has just signed to play for Manchester City football club, will be paid £130,000.00 per WEEK for his services. I earn £280.00 per week. Ghost, would you genuinely claim that this is because he is 464.3 times more worthy as a human being, than me? That makes me feel pretty worthless. I'm glad you think I'm worthless. Go you."

At first glance, this seems absurd right? A soccer player who doesn't do anything near essential, or a singer or actor, makes buckets of money, while people like police who do what seems to be far more essential make much less? Capitalism gives people what they want. It's sad, but the people have spoken. They choose to spend more of their money on watching soccer games, movies, or buying music CD's than on say, plumbing. The general population itself has decided what is a valuable service in the way they spend their money, it is not up to some intuitive sense of, oh a mechanic is more useful than a child actor.

"The difference between conservative orthodoxy and liberal orthodoxy (if I may be so bold) is that liberals see the whole of humanity as an extended family - and conservatives do not."

Is this liberal vs. conservative? I am very much a social liberal and social progressive in that I support same-sex marriage and abortions and stem cell research and whatnot, but I am closer to being a fiscal conservative. I don't see the logical bridge that says that if I support capitalism I have to want stricter immigration laws or that if I think that we shouldn't go to war, I am also in support of minimum wage legislation. Issues should be considered on their individual merit, not upon a default stance given by liberal or conservative orthodoxy.

To be honest, I very much doubt you treat the rest of the world as your extended family. I'm sure you would spare almost no expense in saving the lives of those close to you, but for the smallest fraction of that expense you could easily save another life somewhere else. In fact, you could probably save 50 lives in a Third World country with the money you might spend to support a family member diagnosed with cancer. The fact is that you can far more depend on people to be selfish than on them to be altruistic. I'm not saying that you don't perhaps donate a dollar a day to some child in Africa, or that you aren't altruistic in any manner, it's just that for practical concerns, when coming up with an economic policy, you cannot depend on people to behave altruistically. It's the problem of the commons. There are some states with conservative senators that lowered taxes, and when liberals claimed that this was bad, they set up a Tax Me More fund for any guilty liberals to pay more. Hardly any money was raised. I'm not putting down liberals in any way, which constitute the vast majority of my peers, but you can't depend on anybody's altruism. This is the reason taxation has to be forcible.

Phew. This post is long enough to kill a thread. I hope it doesn't though. =/

Wow, so many posts were posted in the time it took me to write that monolith. o.O

I feel like cheering...

"The local crack dealer and pimp provide people with products and employment that they want. By connecting people in the whole system, they create wealth. Now, why do you begrudge them the wealth they created?

It is not an abusive relationship. They pay the employee what he or she is worth, the market rate. That that is less than what the owning family who run and set up the whole operation is neither here nor there. The mule does less valuable work for drug racket than the crime family, so of course he is paid less."

The criminal and underground economy is an intensely interesting subject. Especially interesting is that demand for illegal products is not dampened much by the fact that they are illegal. In fact, I would say a large part of problems associated with these trades is simply because of their illegality. Crime cartels could hardly exist if it were not for the large profits they can reap from the illegal drug trade. If drugs were legal, their price would be quickly driven down. A mule is paid extremely well for their services, I don't think you'll hear complaints from them. The relationship between a pimp and prostitute is not a capitalistic relationship because the pimp uses force and not an exchange to take a share of the prostitutes hard earned money. The prostitutes property rights are not being asserted. I think you'll find in the areas where prostitution is less illegal, decriminalized, or completely legal, there is much less of a problem with pimps. Professional escort agencies are started that offer employment in the same way that any other company does.

The property rights of the Somalian people are hardly asserted...

"Who decides who is worth more? Right now, I think the argument that a UK MP is worth more than a nurse (say) is pretty thin, and I know who gets significantly more money. To assume the capitalism in any form rewards those that deserve most the most is not backed up by any kind of evidence."

The collective people should. The UK MP's salary isn't determined by the free market. Nobody in particular should make the value call that a chef is worth more or less than surgeon, or if a professional golfer is worth more or less than a taxi cab driver. People choose to spend their money based on how much utility they receive from the good or service, and decide themselves how much each thing is worth. The people seem to have unanimously spoken that the entertainment services provided by professional athletes are more valuable to them than the services of a carpenter.

TheGhostmaker: "Somalia suffers from lawlessness, something that free market capitalism doesn't involve."
Yes - by not addressing the issue of lawlessness they (the theorists) don't have to deal with capitalism's fatal flaw. Capitalism needs laws and regulation and free press and internet neutrality and an educated workforce for it to function appropriately. The purest libertarian ideal of capitalism that says that all government (other than, mysteriously, defense) is bad and should be eliminated fails completely because when you eliminate government what you get is Somalia. Pure capitalism is like the '60's idea of Free Love... intoxicating, but wholly impractical. Yes, pure capitalism works brilliantly - except that it doesn't.

Erm. You are plainly wrong. In the free market capitalism the government exists to protect property rights and other rights of the citizen. Who was it that told you that libertarianism was a form of anarchism?

@Chrispmini's but the taxation is only forcible for those who participate in the society that allowed them to create the wealth in the first place. Certainly it's pretty unlikely that someone could find somewhere to go where they wouldn't be taxed in any way, but the point is that by remaining in a country you are essentially agreeing to be part of that country and it's social contract, which, mostly likely, involves taxes. If you generate wealth within a society, you are using resources from that society, and taking advantage of the advantages that that society has set up, I think it's entirely reasonable, and in no way immoral, for the society to expect some form of payment, or some portion of that wealth be returned. If you can show me someone who generates their wealth without using any resources or without taking advantage of any services provided by the society around them, I might agree that it would be immoral to tax that person.

I also find it a bit disturbing that as you defend capitalism (which in general I would also do, I don't actually agree with Dexter.Morgan or others here who have implied that capitalism is in some way inherently immoral), you seem to more and more imply that those who don't become wealthy, or live in poverty are lazy and dont' do anything. I don't think you actually beleive this but your words keep hinting in that direction.

So there is no confusion I'll give you some quotes from your epic post above:

"If nobody does anything, everyone is poor." and then later in the same paragraph "If you force those who generate wealth to give it up for those who don't, you're killing the goose that lays the golden egg." I realize you're not necessarily saying that those who are poorer are that way because they don't do anything, but I hope you can see how it sounds that way.

Honestly though, again, I think of taxes on wealth generation not as forcing "those who generate wealth to give it up for those who don't" but simply repaying society for the resources and services it provided that allowed you to generate that wealth. Think of it like an investment, the society "invested" in you by providing resources with which you could generate that wealth, and creating the conditions under which you could do so. It seems entirely fair to me that the society around you should get some sort of return on that investment, which can then be used to "invest" in everyone else, so that hopefully more people will be able to do the same thing.

"If nobody does anything, everyone is poor." I think that is probably a fairly sound statement. You can do something and still be poor, but by working, you will become less poor. All Chris is saying is that poverty is the normal condition, so we must ask not how to stop poverty, but how to create wealth.

@rlumley - My point is not that I believe that the bible tells me what is or isn't moral, but that what is says is moral is so small in comparison to what may be moral, that if it says something is moral (or isn't immoral, in this case taxes) then it probably is. But, likewise, if it says something is immoral, it may or may not be, because the church has so deemed everything to be immoral that very little is moral in the church's view.

Likewise, the satanic bible says that many things most educated men consider immoral are just fine, but even it draws the line at some things. so, if it says something is immoral, it probably is, butjust because it says something is moral doesn't mean it is. The logic you mention is there. Find the smallest set of something and if you hypothesis fits that set, then it must be true. If the hypothesis doesn't fit that set, then reverse the hypothesis and find another smallest set. Applying the same logic, the reverse hypothesis is either true (fits the new set) or it is indeterminate based on the facts at hand and the hypothesis needs to be revisited.

Yes, I realize that that is true and a sound statement, and I realize what he was trying to say with that, but I guess I just wanted to point out how it could be construed. More than anything I guess i'm just trying to get him to be more careful about his wording so that he isn't misunderstood, (and to be sure he ISN'T arguing what amounts to social Darwinism).

Chrispminis - you said

"The UK MP's salary isn't determined by the free market. Nobody in particular should make the value call that a chef is worth more or less than surgeon, or if a professional golfer is worth more or less than a taxi cab driver. People choose to spend their money based on how much utility they receive from the good or service, and decide themselves how much each thing is worth. The people seem to have unanimously spoken that the entertainment services provided by professional athletes are more valuable to them than the services of a carpenter."

The point you miss is that the people DON'T decide how much anyone gets paid. That is the fundamental flaw in the argument. No-one has ever asked me how much I think 99.999% of the working population should be paid. the only renumeration I have been able to influence is my own, and those people for whom I have been directly responsible. As a consumer, my decision to watch a film, buy a CD or employ a plumber in no way gives me any say in how much they actually get paid.

For clarity, I'm not anti-capitalist, or anti-market - I just think that it does not always/often provide the best solution and fairest rewards. We're currently enjoying the fruits of unfettered free market capitalism (hello recession), but that's another debate.

I have to say, the most interestng part of this is seeing how other people view the same thing...

Chrispminis, so, basically, what we see in capitalism in it's current application is akin to American Idol - where rewards are voted on by the semi-ignorant public rather than talent rewarded on a more real basis. For free-market proponents to claim that CEOs are worth more (regardless of whether they bankrupt their company) than the common worker or engineer at the company simply because they are paid more (which, I recognize, you are not arguing) is absurd. ...and yes, I've heard that argument many times.

That said, I don't have a real good solution other than transparency and information. And that brings me to my biggest complaint - the lack of universal quality education and the lack of a requirement (consider it part of the schooling) to apply said education immediately out of school (peace corp, or other service including military). Given an educated populace (including a strong education in civics, psychology, logic, sociology, and science) accustomed to service, I believe that much of the ugliness of capitalism would be pruned away...

"you seem to more and more imply that those who don't become wealthy, or live in poverty are lazy and dont' do anything. I don't think you actually beleive this but your words keep hinting in that direction."

Yeah, I've been here before. When I say "If you do nothing, you will be poor", I don't mean to say, "Those that are poor, are poor, because they do nothing". I wasn't commenting on work ethic at all, but simply using that point to illustrate that the natural state is poverty, not some middle ground from which rich people steal from poor people to create poverty. I've always thought this was a common misconception that to go up you have to push someone else down. Wealth is created and developed, you don't start out with some set amount.

"I think it's entirely reasonable, and in no way immoral, for the society to expect some form of payment, or some portion of that wealth be returned. If you can show me someone who generates their wealth without using any resources or without taking advantage of any services provided by the society around them, I might agree that it would be immoral to tax that person."

Ok, I think this is chicken and egg here. I doubt anybody generates wealth without taking advantage of government services because they're very abundant. That's not to say that they couldn't... Can we agree then that taxation and government services are in many ways an exchange? That by itself is not immoral, and I agree that if you sell me a chicken, I should pay for it. However, it becomes immoral when you force the sale of the chicken to me when I don't want the chicken, or I believe you're overcharging for the chicken. Exchange should not be conducted under a threat of force, or it is no exchange at all. If I don't want to buy your chicken at that price, you accept this, and either you try to haggle and lower the price, or you take your business elsewhere. If I don't want to pay, say the portion of my taxes that goes towards funding the War in Iraq or Social Security, it's not nearly as simple... there's a distinct threat of force. It's necessary, but yes, I think it's immoral.

Pete U:

You do choose the pay, along with everyone else, by what you buy and sell. There isn't somebody pulling the strings, there are equilibriums that are met.

I see what you're saying but I just don't agree. You're not being forced to buy the chicken. You can live somewhere else, or you can choose to live at a simple enough level that you won't have to pay taxes (as some people voluntarily do). You don't have to use the resources of the society around you. I just don't think its immoral for society to expect some return on it's investment in you.

This discussion has become pointless. It's clear that the pro-capitalist posters on here will never agree with the anti-capitalists. Both sides taking part in this debate have already formed their view, and each side holds their view so strongly that they are not really listening to the other. Therefore in order to avoid this thread going on for ever, I will bid you all good day and withdraw from it.

Whoa whoa whoa. Who said everyone falls into one of those two categories? I certainly don't consider myself "anti-capitalist" but I'm not sure I'd label myself as "pro-capitalist" either. I simply don't think taxes are immoral and don't think that lessie faire capitalism is a good idea.

"Chrispminis, so, basically, what we see in capitalism in it's current application is akin to American Idol - where rewards are voted on by the semi-ignorant public rather than talent rewarded on a more real basis. For free-market proponents to claim that CEOs are worth more (regardless of whether they bankrupt their company) than the common worker or engineer at the company simply because they are paid more (which, I recognize, you are not arguing) is absurd. ...and yes, I've heard that argument many times. "

No, CEO's are paid more because they are worth more, they are not worth more because they are paid more. There is an issue here if the CEO had a large part in deciding their own salary, but the CEO's job is incredibly important and has a huge impact on the success of a company. It is in the company's interest to offer large compensation and hire the most qualified people for the job in the world and offer considerable compensation to attract them. Professional athletes, actors, and rock stars are paid more because society have deemed them to be more valuable. You can dismiss it as simple American Idol and semi-ignorance, but you'd be imposing your views on the countless people who do value the service of entertainment. It is not up to the educated elite to decide that books are better than video games and decry the obvious will of the masses.

If it's any consolation, educated people are paid far more than uneducated people for less "hard labour" because they are more skilled and their time and labour is worth more. There is significant incentive to get an education, and despite that there exists significant inequality between rich and poor, there is still significant mobility between classes, because while America doesn't truly have capitalism, the free market will promote talent, motivation, and hard work when it sees it.

To answer PeteU's question, you choose what you value every time you spend money. If you didn't value what you bought, you wouldn't have bought it. You buy whatever gives you the most utility, whether this is actually something practical or whether it's simple pleasure doesn't matter. In my every day life, I get far more utility out of say 'Dark Side of The Moon' than I do from a hammer. The only real way to compare the value of things as distinct as piano lessons, concert tickets, and pornography, is by the dollars you spend, because each dollar has an opportunity cost. When you go to see Pixar's animated film 'Up', you make a choice to spend that 12$ on that film, rather than on say, a book. Your individual decisions might be a drop in the ocean, but the collective decisions of consumers absolutely do affect the pay grade of every profession.

Also... I think there is still value in the discussion so far, so while I recognize your right to leave the thread, I hope others will keep discussing things.