USA's Moral Obligation to Spread Democracy: Thoughts?

[vanesch]

You fail to see that the need for capitalism is greatest in the third world were there is little capitalism but great poverty.

Yes, I fail to see that. Open capitalism just allows for more poverty there, because they cannot compete yet with the West. So normally they should be competed completely out of the market. The only thing they have as competitive ressource, is very cheap labor. So indeed, if they sacrifice two generations working in 19th century conditions, they'll be over it.
And, BTW, is it true that most African states are not open to capitalism ?

And regarding wealth in general, more money will probably not make you more happy if you are healthy and are able to earn a modest amount of money. But if you have any serious disease, mental or physical, money will make you happier. It can buy outstanding psychotherapy, steadily more expensive medications, the best surgeons and fabulous care. Not to mention food and shelter. And we will all need this we when get old, if not before.

Except if that is considered a political goal for everybody, and is state-provided. Most Western states can do so. That will take away resources for 3th generation mobile telephones, though.

And more wealth allows shorter working hours, more holidays and allows children and the elderly to avoid working.

That's funny. I know it is less of a problem in the US, but most European countries have an unemployment "problem". That's, by itself, a startling observation: after we've done all the work we wanted, we don't need all hands! So why do people who work then have to work so hard, while they would like to have more free time ??
So unemployment shouldn't be a problem, but a goal !

 

[Burnsys]

You fail to see that the need for capitalism is greatest in the third world were there is little capitalism but great poverty.

And regarding wealth in general, more money will probably not make you more happy if you are healthy and are able to earn a modest amount of money. But if you have any serious disease, mental or physical, money will make you happier. It can buy outstanding psychotherapy, steadily more expensive medications, the best surgeons and fabulous care. Not to mention food and shelter. And we will all need this we when get old, if not before.

More wealth in a society increases the average length of life, decreases infant and mother mortality and makes it possible for people with diseases like diabetes to survive. It allows adequate nutrition, preventing previously common diseases like rickets, blindness and goitre. It probably increases intelligence (The Flynn effect).

And more wealth allows shorter working hours, more holidays and allows children and the elderly to avoid working. It gives better and less dangerous working conditions. It allows choice in work. And better housing, protecting for example from cold and heat. Dental care so not most people have lost their teeths by the age of forty. And at the end of life, it can make death painless instead of the painful misery that was earlier the fate of, for example, cancer patients.

And more wealth in society in the future will allow more of these benefits.

So money will probably not make you much more happy when you are in good physical and mental health and enjoy your work and the people around you. Otherwise, money can buy happiness.

What do you knwon about the 3rd world problems... More capitalism? today 90% of the causes of poverty in 3rd world countrys is THE DEBT. the debt we owe to the imf bid, etc... This debt started with this "ERRORS" you say america made.. when they supported murderous dictators in the 70'...
Now 50% of our budget go directly to pay interest of this debt...

Here ECONOMIC NOBEL WINNER has something to say about the imf...
I am livin in a 3rd world country and believe me... this is the more logical explanation of what is happening here.

PLEASE. PLEASEEEEE READ...:
---------------------------------------------------------------------
The Globalizer Who Came In From the Cold

JOE STIGLITZ: TODAY’S WINNER OF THE NOBEL PRIZE IN ECONOMICS
by Greg Palast

The World Bank’s former Chief Economist’s accusations are eye-popping - including how the IMF and US Treasury fixed the Russian elections

"It has condemned people to death," the former apparatchik told me. This was like a scene out of Le Carre. The brilliant old agent comes in from the cold, crosses to our side, and in hours of debriefing, empties his memory of horrors committed in the name of a political ideology he now realizes has gone rotten.

And here before me was a far bigger catch than some used Cold War spy. Joseph Stiglitz was Chief Economist of the World Bank. To a great extent, the new world economic order was his theory come to life.

I "debriefed" Stigltiz over several days, at Cambridge University, in a London hotel and finally in Washington in April 2001 during the big confab of the World Bank and the International Monetary Fund. But instead of chairing the meetings of ministers and central bankers, Stiglitz was kept exiled safely behind the blue police cordons, the same as the nuns carrying a large wooden cross, the Bolivian union leaders, the parents of AIDS victims and the other ‘anti-globalization’ protesters. The ultimate insider was now on the outside.

In 1999 the World Bank fired Stiglitz. He was not allowed quiet retirement; US Treasury Secretary Larry Summers, I’m told, demanded a public excommunication for Stiglitz’ having expressed his first mild dissent from globalization World Bank style.

Here in Washington we completed the last of several hours of exclusive interviews for The Observer and BBC TV’s Newsnight about the real, often hidden, workings of the IMF, World Bank, and the bank’s 51% owner, the US Treasury.

And here, from sources unnamable (not Stiglitz), we obtained a cache of documents marked, "confidential," "restricted," and "not otherwise (to be) disclosed without World Bank authorization."

Stiglitz helped translate one from bureaucratise, a "Country Assistance Strategy." There’s an Assistance Strategy for every poorer nation, designed, says the World Bank, after careful in-country investigation. But according to insider Stiglitz, the Bank’s staff ‘investigation’ consists of close inspection of a nation’s 5-star hotels. It concludes with the Bank staff meeting some begging, busted finance minister who is handed a ‘restructuring agreement’ pre-drafted for his ‘voluntary’ signature (I have a selection of these).

Each nation’s economy is individually analyzed, then, says Stiglitz, the Bank hands every minister the same exact four-step program.

Step One is Privatization - which Stiglitz said could more accurately be called, ‘Briberization.’ Rather than object to the sell-offs of state industries, he said national leaders - using the World Bank’s demands to silence local critics - happily flogged their electricity and water companies. "You could see their eyes widen" at the prospect of 10% commissions paid to Swiss bank accounts for simply shaving a few billion off the sale price of national assets.

And the US government knew it, charges Stiglitz, at least in the case of the biggest ‘briberization’ of all, the 1995 Russian sell-off. "The US Treasury view was this was great as we wanted Yeltsin re-elected. We don’t care if it’s a corrupt election. We want the money to go to Yeltzin" via kick-backs for his campaign.

Stiglitz is no conspiracy nutter ranting about Black Helicopters. The man was inside the game, a member of Bill Clinton’s cabinet as Chairman of the President’s council of economic advisors.

Most ill-making for Stiglitz is that the US-backed oligarchs stripped Russia’s industrial assets, with the effect that the corruption scheme cut national output nearly in half causing depression and starvation.

After briberization, Step Two of the IMF/World Bank one-size-fits-all rescue-your-economy plan is ‘Capital Market Liberalization.’ In theory, capital market deregulation allows investment capital to flow in and out. Unfortunately, as in Indonesia and Brazil, the money simply flowed out and out. Stiglitz calls this the "Hot Money" cycle. Cash comes in for speculation in real estate and currency, then flees at the first whiff of trouble. A nation’s reserves can drain in days, hours. And when that happens, to seduce speculators into returning a nation’s own capital funds, the IMF demands these nations raise interest rates to 30%, 50% and 80%.

"The result was predictable," said Stiglitz of the Hot Money tidal waves in Asia and Latin America. Higher interest rates demolished property values, savaged industrial production and drained national treasuries.

At this point, the IMF drags the gasping nation to Step Three: Market-Based Pricing, a fancy term for raising prices on food, water and cooking gas. This leads, predictably, to Step-Three-and-a-Half: what Stiglitz calls, ‘The IMF riot.’

The IMF riot is painfully predictable. When a nation is, "down and out, [the IMF] takes advantage and squeezes the last pound of blood out of them. They turn up the heat until, finally, the whole cauldron blows up," as when the IMF eliminated food and fuel subsidies for the poor in Indonesia in 1998. Indonesia exploded into riots, but there are other examples - the Bolivian riots over water prices last year and this February, the riots in Ecuador over the rise in cooking gas prices imposed by the World Bank. You’d almost get the impression that the riot is written into the plan.

And it is. What Stiglitz did not know is that, while in the States, BBC and The Observer obtained several documents from inside the World Bank, stamped over with those pesky warnings, "confidential," "restricted," "not to be disclosed." Let’s get back to one: the "Interim Country Assistance Strategy" for Ecuador, in it the Bank several times states - with cold accuracy - that they expected their plans to spark, "social unrest," to use their bureaucratic term for a nation in flames.

That’s not surprising. The secret report notes that the plan to make the US dollar Ecuador’s currency has pushed 51% of the population below the poverty line. The World Bank "Assistance" plan simply calls for facing down civil strife and suffering with, "political resolve" - and still higher prices.

The IMF riots (and by riots I mean peaceful demonstrations dispersed by bullets, tanks and teargas) cause new panicked flights of capital and government bankruptcies. This economic arson has it’s bright side - for foreign corporations, who can then pick off remaining assets, such as the odd mining concession or port, at fire sale prices.

Stiglitz notes that the IMF and World Bank are not heartless adherents to market economics. At the same time the IMF stopped Indonesia ‘subsidizing’ food purchases, "when the banks need a bail-out, intervention (in the market) is welcome." The IMF scrounged up tens of billions of dollars to save Indonesia’s financiers and, by extension, the US and European banks from which they had borrowed.

A pattern emerges. There are lots of losers in this system but one clear winner: the Western banks and US Treasury, making the big bucks off this crazy new international capital churn. Stiglitz told me about his unhappy meeting, early in his World Bank tenure, with Ethopia’s new president in the nation’s first democratic election. The World Bank and IMF had ordered Ethiopia to divert aid money to its reserve account at the US Treasury, which pays a pitiful 4% return, while the nation borrowed US dollars at 12% to feed its population. The new president begged Stiglitz to let him use the aid money to rebuild the nation. But no, the loot went straight off to the US Treasury’s vault in Washington.

Now we arrive at Step Four of what the IMF and World Bank call their "poverty reduction strategy": Free Trade. This is free trade by the rules of the World Trade Organization and World Bank, Stiglitz the insider likens free trade WTO-style to the Opium Wars. "That too was about opening markets," he said. As in the 19th century, Europeans and Americans today are kicking down the barriers to sales in Asia, Latin American and Africa, while barricading our own markets against Third World agriculture.

In the Opium Wars, the West used military blockades to force open markets for their unbalanced trade. Today, the World Bank can order a financial blockade just as effective - and sometimes just as deadly.

Stiglitz is particularly emotional over the WTO’s intellectual property rights treaty (it goes by the acronym TRIPS, more on that in the next chapters). It is here, says the economist, that the new global order has "condemned people to death" by imposing impossible tariffs and tributes to pay to pharmaceutical companies for branded medicines. "They don’t care," said the professor of the corporations and bank loans he worked with, "if people live or die."

By the way, don’t be confused by the mix in this discussion of the IMF, World Bank and WTO. They are interchangeable masks of a single governance system. They have locked themselves together by what are unpleasantly called, "triggers." Taking a World Bank loan for a school ‘triggers’ a requirement to accept every ‘conditionality’ - they average 111 per nation - laid down by both the World Bank and IMF. In fact, said Stiglitz the IMF requires nations to accept trade policies more punitive than the official WTO rules.

Stiglitz greatest concern is that World Bank plans, devised in secrecy and driven by an absolutist ideology, are never open for discourse or dissent. Despite the West’s push for elections throughout the developing world, the so-called Poverty Reduction Programs "undermine democracy."

And they don’t work. Black Africa’s productivity under the guiding hand of IMF structural "assistance" has gone to hell in a handbag. Did any nation avoid this fate? Yes, said Stiglitz, identifying Botswana. Their trick? "They told the IMF to go packing."

So then I turned on Stiglitz. OK, Mr Smart-Guy Professor, how would you help developing nations? Stiglitz proposed radical land reform, an attack at the heart of "landlordism," on the usurious rents charged by the propertied oligarchies worldwide, typically 50% of a tenant’s crops. So I had to ask the professor: as you were top economist at the World Bank, why didn’t the Bank follow your advice?

"If you challenge [land ownership], that would be a change in the power of the elites. That’s not high on their agenda." Apparently not.

Ultimately, what drove him to put his job on the line was the failure of the banks and US Treasury to change course when confronted with the crises - failures and suffering perpetrated by their four-step monetarist mambo. Every time their free market solutions failed, the IMF simply demanded more free market policies.

"It’s a little like the Middle Ages," the insider told me, "When the patient died they would say, ‘well, he stopped the bloodletting too soon, he still had a little blood in him.’"

I took away from my talks with the professor that the solution to world poverty and crisis is simple: remove the bloodsuckers

 

[Aquamarine]

Yes, I fail to see that. Open capitalism just allows for more poverty there, because they cannot compete yet with the West. So normally they should be competed completely out of the market. The only thing they have as competitive ressource, is very cheap labor. So indeed, if they sacrifice two generations working in 19th century conditions, they'll be over it.

This would be a great improvement since they are now dying in 14th century conditions.

And, BTW, is it true that most African states are not open to capitalism ?

Look for yourself in some of the indexes of economic freedom:
http://www.freetheworld.com/
http://www.heritage.org/research/features/index/

That's funny. I know it is less of a problem in the US, but most European countries have an unemployment "problem". That's, by itself, a startling observation: after we've done all the work we wanted, we don't need all hands! So why do people who work then have to work so hard, while they would like to have more free time ??
So unemployment shouldn't be a problem, but a goal !

The working time cannot be decreased to zero. The US and western europe have now too little capitalism. All long-term projections shows that the current welfare state cannot be supported in the future. Too many old people too support and too many young who are able to work but not doing so. They are not working because regulations like minimum wage and free welfare. The system is headed to bankruptcy.

And since there are more welfare and regulations in Europe, they have less growth and are rapidly becoming poorer compared to the US. Compare for example the income of engineers in Europe and the US.

 

[Aquamarine]

Burnsys, we have already discussed this before:
https://www.physicsforums.com/showthread.php?t=47317

In short, the WB and the IMF are state agencies using taxpayer's money to make themselves and the most corrupt of ruling elite in the third world rich.

 

[Burnsys]

Burnsys, we have already discussed this before:
https://www.physicsforums.com/showthread.php?t=47317

In short, the WB and the IMF are state agencies using taxpayer's money to make themselves and the most corrupt of ruling elite in the third world rich.

yes they make the ruling elite in the third world corrupt and welthier..
but their are controlled by the ruling elite in the first world...

Explain me why the imf DEMAND our government to alow a raise in the phone services, electric, water, and all our critical infrastructure services which are in hands of international corporations from the 1rs world (Ruling elite of the first world)

The imf is controlled by america and europe ELITE... which obiusly is a partner of your goverment...

 

[Aquamarine]

yes they make the ruling elite in the third world corrupt and welthier..
but their are controlled by the ruling elite in the first world...

Explain me why the imf DEMAND our government to alow a raise in the phone services, electric, water, and all our critical infrastructure services which are in hands of international corporations from the 1rs world (Ruling elite of the first world)

The imf is controlled by america and europe ELITE... which obiusly is a partner of your goverment...

Who said that the ruling elite in the western worlds understands the benefits of capitalism? Or that they will not try to gain personal advantages by restricting it?

Regarding Argentina, I have already given explanations for its economic tragedy compared to more capitalistic countries in the previous link.

 

[Burnsys]

Who said that the ruling elite in the western worlds understands the benefits of capitalism? Or that they will not try to gain personal advantages by restricting it?

Regarding Argentina, I have already given explanations for its economic tragedy compared to more capitalistic countries in the previous link.

If they are the ruling elite of the capitalism system i am real sure they understands it's benefits... if not they will not be the ruling elite. lol

And they gain personal advantages not restricting it, but liberalizing it, couse if a multinational corporation want to get more profits from another country, they need to open the victims market, they need to be "Free" to do what they want, and they field is capitalism, that is where they move. they are the number 1 promoters of capitalism

 

[Aquamarine]

If they are the ruling elite of the capitalism system i am real sure they understands it's benefits... if not they will not be the ruling elite. lol

And they gain personal advantages not restricting it, but liberalizing it, couse if a multinational corporation want to get more profits from another country, they need to open the victims market, they need to be "Free" to do what they want, and they field is capitalism, that is where they move. they are the number 1 promoters of capitalism

If you think that the ruling elites must be smart about economics, look no further than communistic or fundamentalistic states.

And unfortunately capitalists have often been promoters of less capitalism, if this can reduce competition against their own business. Every company that is in trouble wants legal protection from competitors and state support.

And as usual, you present no evidence that capitalism is harmful and ignore the overwhelming evidence that shows that more capitalism in a country means less poverty.

 

[Burnsys]

If you think that the ruling elites must be smart about economics, look no further than communistic or fundamentalistic states.

And unfortunately capitalists have often been promoters of less capitalism, if this can reduce competition against their own business. Every company that is in trouble wants legal protection from competitors and state support.

And as usual, you present no evidence that capitalism is harmful and ignore the overwhelming evidence that shows that more capitalism in a country means less poverty.

Of Course they are smart about economics, at leats capitalist elite, i don't know about comunist or islamic elite. But great part of capitalist elite are bankers, and of course a banker know about economics, they mabe be promote less capitalism in countrys of the first world. but overhere they have no competition, couse they have bougth it all with loans from their banks..

Here 90% of the market is owned by 2 communications companies,, 1 french, 1 from italy, 1 Water service company from usa, 3 oil companies: 2 from usa, 1 from spain, 1 electric company from usa, 1 bank from every first world country, the rest which represent less than 20% is left to us.. the same happen with the food industry, electronic, mining, clothes, automovile, etc... they bougth it all with loans.. they have no more competition here..
i don't say capitalism is harmfull, but "This Capitalism" USA is spreading in the world, by the use of brutal force, or by extorsion becouse of the debts, is not good.

 

[russ_watters]

Of Course they are smart about economics, at leats capitalist elite, i don't know about comunist or islamic elite. But great part of capitalist elite are bankers, and of course a banker know about economics, they mabe be promote less capitalism in countrys of the first world. but overhere they have no competition, couse they have bougth it all with loans from their banks.

The richest man in the world is Bill Gates - he knows software, but that's about it: he seems genuinely confused about business and economics.

 

[Burnsys]

The richest man in the world is Bill Gates - he knows software, but that's about it: he seems genuinely confused about business and economics.

i don't think he is confused about bussines and economic. if not he wouldn't be the richest man in the world...

My point is that the richests men in the world... they are the one who shape the global busines and economics.. i don't know how to explain you...

They have corporations and companies all around the world, and they manage very large amounts of money, they control global busines and economics, the rest of us, have to adapt to them..

 

[Smurf]

The richest man in the world is Bill Gates - he knows software, but that's about it: he seems genuinely confused about business and economics.

The richest man in the world is Ingvar Kamprad, founder of IKEA.
Creator of Wal-Mart would be richer if he hadn't died recently (his grand children got almost $30 bill each)
Bill Gates graduated business school with top grades if my memory serves me, and uh, isn't he dead.

This site has a different opinon:

http://www.forbes.com/lists/results.jhtml?passListId=10&passYear=2004&passListType=Person&searchParameter1=unset&searchParameter2=unset&resultsStart=1&resultsHowMany=25&resultsSortProperties=%2Bnumberfield1%2C%2Bstringfield2&resultsSortCategoryName=Rank&passKeyword=&category1=category&category2=category

 

[Smurf]

The conventional view serves to protect us from the painful job of thinking. ~J.K. Galbraith

 

[vanesch]

The US and western europe have now too little capitalism. All long-term projections shows that the current welfare state cannot be supported in the future.

I'm sorry but this sounds too much as an ideology that has to be supported at all costs. The "US has too little capitalism" sounds a bit like Stalin wasn't communist enough, that's why the soviet union didn't work out.

It seems to me, as I said, that die-hard capitalist proponents make tautological statements of the kind. If something works well somewhere, it is used as an argument in support of the ideology to be defended, and if it doesn't work out, then there wasn't enough of it.

The theoretical problems with capitalism are the following:
- the market system is a kind of weighted voting system, where the more money you have, the more your vote counts (because the more you can consume and hence send out market signals). As such, there is an instability that will converge to making the rich richer and the poor poorer, with a production that is optimised to satisfy the rich.
- most market analysis is based on steady-state solutions (no time dynamics). It is not because you have a steady-state solution that the time-dependent dynamics will evolve towards it (you can have dynamical instablities, especiall when there are delays).
- there is a positive feedback, in that the "choice of the consumer" is now in a large part determined by publicity, which is financed by the producers. So there aren't the two essential poles anymore that are supposed to keep each other in balance: the producers determine demand, and they determine offer.
- because of economies of scale, there is a natural tendency to make big corporations. Normally this should be offset, from a certain size onward, by the increased overhead. But the problem is that big companies have two extra assets: first, they have more publicitary muscle and hence can change the demand at their wishes ; second, they start to be able to influence political power and can thus influence the rules of the game. So there is also a tendency towards quasi monopoly.

The two reasons why capitalism works, are much simpler: they are based upon a glorification of greed and the menace of poverty.

 

[Smurf]

Good post Vanesch, but the USSR wasn't communist, they didn't even call them selves communists but socialists, Union of Soviet Socialist Republics. And they weren't even very good at that.

To add to your list I think the combination of both Free Market and Free Press allows Corporations way too much control over [ultimatly the minds of] people.

 

[the number 42]

The United States has a moral obligation to spread Democratic ideals in other nations

The Soviet Union has a moral obligation to spread Communist ideals in other nations

Palestine has a moral obligation to spread Islamic ideals in other nations

Hitler has a moral obligation to spread Nation Socialist ideals in other nations

Guardian readers have a moral obligation to spread Democratic ideals in other nations

France has a moral obligation to spread Culinary Habits in other nations

Macdonalds has a moral obligation to spread Fast Food to other nations

Mrs Smith has a moral obligation to spread her Morally Upright views to her neighbours

etc

Ever helped an old lady across the road, then found out she didn't want to cross in the first place? Do unto others as THEY would have you do unto them.

 

[vanesch]

The richest man in the world is Bill Gates - he knows software

He doesn't !

 

[vanesch]

And unfortunately capitalists have often been promoters of less capitalism, if this can reduce competition against their own business.

You seem to start to understand the fundamental problem of capitalism. Consider this "promotion of less capitalism" as a market signal, coming from successful agents

 

[Aquamarine]

I'm sorry but this sounds too much as an ideology that has to be supported at all costs. The "US has too little capitalism" sounds a bit like Stalin wasn't communist enough, that's why the soviet union didn't work out.

It seems to me, as I said, that die-hard capitalist proponents make tautological statements of the kind. If something works well somewhere, it is used as an argument in support of the ideology to be defended, and if it doesn't work out, then there wasn't enough of it.

The theoretical problems with capitalism are the following:
- the market system is a kind of weighted voting system, where the more money you have, the more your vote counts (because the more you can consume and hence send out market signals). As such, there is an instability that will converge to making the rich richer and the poor poorer, with a production that is optimised to satisfy the rich.
- most market analysis is based on steady-state solutions (no time dynamics). It is not because you have a steady-state solution that the time-dependent dynamics will evolve towards it (you can have dynamical instablities, especiall when there are delays).
- there is a positive feedback, in that the "choice of the consumer" is now in a large part determined by publicity, which is financed by the producers. So there aren't the two essential poles anymore that are supposed to keep each other in balance: the producers determine demand, and they determine offer.
- because of economies of scale, there is a natural tendency to make big corporations. Normally this should be offset, from a certain size onward, by the increased overhead. But the problem is that big companies have two extra assets: first, they have more publicitary muscle and hence can change the demand at their wishes ; second, they start to be able to influence political power and can thus influence the rules of the game. So there is also a tendency towards quasi monopoly.

The two reasons why capitalism works, are much simpler: they are based upon a glorification of greed and the menace of poverty.

All empirically proven wrong. The more capitalism, the less poverty.

And since all people become richer in capitalism, then the corporations produce for all. There is not much money in luxury goods for the super-rich, most big corporations make money by products for the common people.

Redgarding the supposed influence of the corporations on politics, it seems to have failed miserably. Taxes and socialization of the economy have increased dramatically all through the 20th century.

Regarding advertisement:
http://www.econlib.org/library/Enc/Advertising.html
http://www.econlib.org/library/Enc/BrandNames.html

And you seem to have no knowledge of theoretical economics. I suggest reading something by for example MIses.

 

[Aquamarine]

Of Course they are smart about economics, at leats capitalist elite, i don't know about comunist or islamic elite. But great part of capitalist elite are bankers, and of course a banker know about economics, they mabe be promote less capitalism in countrys of the first world. but overhere they have no competition, couse they have bougth it all with loans from their banks..

Here 90% of the market is owned by 2 communications companies,, 1 french, 1 from italy, 1 Water service company from usa, 3 oil companies: 2 from usa, 1 from spain, 1 electric company from usa, 1 bank from every first world country, the rest which represent less than 20% is left to us.. the same happen with the food industry, electronic, mining, clothes, automovile, etc... they bougth it all with loans.. they have no more competition here..
i don't say capitalism is harmfull, but "This Capitalism" USA is spreading in the world, by the use of brutal force, or by extorsion becouse of the debts, is not good.

Don't again bring in the conspiracy by bankers. Most rich people are not bankers.

Many rich people of course have knowledge of how to make money in a particular field like software or furniture. This doesn't mean that they know much about macro economics.

Many political leaders, like Roosevelt, knows little about economics.

Again regarding Argentina, is has very little capitalism which is why it has in a remarkably short period of time moved from having living standard equal to that of western Europe to its present misery. If you wang to get rich again, stop blaming others for conspiracy and start going the way of Hong Kong.
http://cf.heritage.org/index2004test/country2.cfm?id=Argentina

 

[the number 42]

Again regarding Argentina, is has very little capitalism which is why it has in a remarkably short period of time moved from having living standard equal to that of western Europe to its present misery. If you wang to get rich again, stop blaming others for conspiracy and start going the way of Hong Kong.

If you think everyone else in the world wants to "get rich", you are mistaken. Try to get your mind around this notion: not everyone wants the things that YOU want. As for blaming others & conspiracy theories... now THAT'S rich.

 

[vanesch]

All empirically proven wrong. The more capitalism, the less poverty.

And since all people become richer in capitalism, then the corporations produce for all. There is not much money in luxury goods for the super-rich, most big corporations make money by products for the common people.

Redgarding the supposed influence of the corporations on politics, it seems to have failed miserably. Taxes and socialization of the economy have increased dramatically all through the 20th century.

Regarding advertisement:
http://www.econlib.org/library/Enc/Advertising.html
http://www.econlib.org/library/Enc/BrandNames.html

And you seem to have no knowledge of theoretical economics. I suggest reading something by for example MIses.

Concerning my knowledge, it is true that I only had basic courses on micro and macro economics, like Byrns and Stone and Eaton and Eaton. It always looked pathetically simplistic to me, as compared to, say, classical mechanics.
The articles you cite are of a similar nature, concerning advertising.
But it doesn't adress the points I was making: that MOST of western economic activity serves to make useless junk, such as 3th generation mobile phones or reality TV shows. Such markets are totally created out of nothing by massive publicity, which, by itself, has been decided by the corporations making this stuff in the first place.
If you think that this is not true, I had a friend who worked in a society that did analysis on the efficiency of publicity, especially for Coca Cola. There is a very close correlation between the ads shown on TV and the consumption, with a delay of one or two days. Once they had a surprise: a peak in the sales data with no correlation in extra advertising. They quickly found out what it was: on a foreign TV chain (which is available), there was a football game and there was an ad for Coca Cola. It seems that the consumer is an almost mindless being, which consumes whatever ads he gets under his nose. The very fact that advertising is an important activity means that it works. The fact that it works, proves my point. What is scaring is the efficiency with which it works!

 

[Aquamarine]

But it doesn't adress the points I was making: that MOST of western economic activity serves to make useless junk, such as 3th generation mobile phones or reality TV shows. Such markets are totally created out of nothing by massive publicity, which, by itself, has been decided by the corporations making this stuff in the first place.
If you think that this is not true, I had a friend who worked in a society that did analysis on the efficiency of publicity, especially for Coca Cola. There is a very close correlation between the ads shown on TV and the consumption, with a delay of one or two days. Once they had a surprise: a peak in the sales data with no correlation in extra advertising. They quickly found out what it was: on a foreign TV chain (which is available), there was a football game and there was an ad for Coca Cola. It seems that the consumer is an almost mindless being, which consumes whatever ads he gets under his nose. The very fact that advertising is an important activity means that it works. The fact that it works, proves my point. What is scaring is the efficiency with which it works!

It seems that the anti-capitalists have now been forced to retreat to the second line of defense. That although capitalism reduces poverty and increases wealth, this is bad.

Who are you to decide what people should see on TV or what telephones they buy with their own money? This is the common socialistic idea that people are too stupid or too easily manipulated to decide for themselves. Instead, this must be decided by central planners. This is ignoring the fact that the people as whole has much greater processing power than a small group of dictators. There is simply no way that the planners can see and process as much data as when the people as a whole participate. ´

Please enlighten us on what goods freely choosen today is undesirable. TV shows that you dislike? Music that you dislike? Food that you dislike?

Regarding advertising, did you actually read the links in my previous post? Do you actually think that any amount of advertising can sell 286 computers for the same price att Pentium computers? Or could sell Doom 1 for the same price as Doom 3? Or could sell soft drinks with salt instead of suger?

Of course, advertising makes people try out new products. Why otherwise pay for it? But advertising for a bad product is money badly spent. Advertising works best for good products that otherwise would not be used and are used again.

http://www.techcentralstation.com/092004I.html
http://www.libertyhaven.com/theoreticalorphilosophicalissues/economics/freeenterpriseandentrepreneurship/advertising.html

 

[Smurf]

Aquamarine, what is the most capitalist country in the world right now? In your opinion?

 

[Astronuc]

And since all people become richer in capitalism, then the corporations produce for all.

That is the standard propaganda. In actuality, more Americans are living in poverty than when Bush took office.

Redgarding the supposed influence of the corporations on politics, it seems to have failed miserably.

Corporate contributions to Bush have paid off for many corportations - less regulation, less enforcement, more tax credits (if they pay taxes), corporate welfare.

Start with Graydon Carter's book, "What We've Lost".

Interesting parallels between Bush administration and those of Harding, Coolidge and Hoover (which lead to the Great Depression).

The US should start to see a decrease in standard of living and longevity within the next decade.

As for exporting democracy - would be nice if it were true - but the current administration is about manipulation and control - exporting democracy (true democracy) is unlikely.

Read Paul Krugman's "The Great Unraveling: Losing Our Way in the New Century".

Of course there's always Fox News, The Cato Institute and the Washington Times.

 

[Smurf]

While your at it read anything by Noam Chomsky too and subscribe to adbusters.

 

[vanesch]

It seems that the anti-capitalists have now been forced to retreat to the second line of defense. That although capitalism reduces poverty and increases wealth, this is bad.

You're looking in too binary a way. I'm not an "anti-capitalist" if you understand by that an opposer of free market and trade, I said that from the beginning. I do believe that the free market and free trade creates a great deal of wealth and entertainment. What I'm arguing with is the ideology that the free market and trade ALL BY ITSELF solve all problems in the best way thinkable (this ideology is what is called capitalism). I'm arguing that state regulation in order to impose certain political goals a society might have is an option that is not necessarily a bad thing, EVEN if it leads to a lower GNP.
The ideal capitalist society has a state that has only one function: that is the protection of property and keeping public order, together with a justice department that solves quarrels among economic agents, and a very small amount of taxes is raised to do so. You don't even need politicians or elections or democracy for that. The function is so minimal that it doesn't matter who organizes it. All the rest is done by the market mechanism, and private initiative. No wellfare, public research, public health care. I'm telling you that I can imagine societies that don't want to live that way. An example of a political desire that cannot be realized is that poor people cannot send out any market signals anymore, so their needs are not taken into account. Society will allocate more ressources to make mobile phones, instead of solving their, much more basic problems.
I think that a certain amount of state regulation is needed, in order to impose a political view of society. And that is blasphemy in the ears of capitalists.

 

[vanesch]

Who are you to decide what people should see on TV or what telephones they buy with their own money? This is the common socialistic idea that people are too stupid or too easily manipulated to decide for themselves. Instead, this must be decided by central planners. This is ignoring the fact that the people as whole has much greater processing power than a small group of dictators. There is simply no way that the planners can see and process as much data as when the people as a whole participate. ´

Yes, yes, you know your courses very well ; I read those arguments too in my books
I'm not AGAINST telephones or Doom 27. I just wanted to illustrate that the allocation of ressources is not always in line with what one might like, politically. Maybe I'm the only one, but I find it ridiculous that a society allocates ressources to improve upon cellular phones, while there are people starving or dying of cold in winter. I don't want to impose that, but I COULD think that certain societies want to have as a political goal that one first tries to solve THAT problem and that one then thinks about mobile phones.
What I wanted to indicate was that that super processing power of all the people is biased by the amount of money they can spend.
Now I don't MIND allocating PART of what people would like to allocate to the fabricate mobile phones, if another part is allocated to solving the problem of the guy who's starving. That will of course make mobile phones slightly more expensive. What I'm describing here is TAXES and as such, some market regulation. I think that that can be a good thing.

 

[vanesch]

Regarding advertising, did you actually read the links in my previous post? Do you actually think that any amount of advertising can sell 286 computers for the same price att Pentium computers? Or could sell Doom 1 for the same price as Doom 3? Or could sell soft drinks with salt instead of suger?

There's a small scandal over here, right now: Danone sold (is still selling) a "miraculous energetic drink" called Actimel. I too bought lots of it, especially for my kid, even though it is quite expensive. Now it turns out that those tiny bottles contain... milk with some sugar. Even the marketing director of Danone is poking fun at people: "Ok, this was a well-thought campain, but even in my wildest dreams I didn't think I would sell so much ordinary milk at such incredible prices"

 

[vanesch]

That although capitalism reduces poverty and increases wealth, this is bad.

This is an honest question: does the following statistic exist somewhere:
A measure of the average living standard (depends on how you define it: say, the value spent on/by, for food, housing and health care) of the 5% poorest people in a nation ?

 

[Aquamarine]

Regarding if capitalism has reduced poverty and what capitalism is, see the first my first two posts here:
https://www.physicsforums.com/showthread.php?t=47317

The most capitalistic nations today can be found here at Exhibit 1.2:
http://www.freetheworld.com/2004/efw2004ch1.pdf
Also look at Exhibit 1.6-1.18 for some correlations of economic freedom, for example with life expectancy, child mortality, child labor, access to water and corruption.

Another graphic illustration of the importance of growth and the greatness of Pax Americana:
http://www.whc.ki.se/index.php

 

[Aquamarine]

Regarding the Bush administration, it has not been particularly capitalistic. Is has increased both military and non-military more than most. For a comparison to other recent presidents:
http://www.cato.org/research/fiscal_policy/bush/images/fig5-592x391.gif

Free trade:

You ran in 2000 as a “free trade president.” Since you took office, you’ve imposed tariffs on steel, shrimp, furniture, lumber, sugar, lingerie, wire, computer chips, catfish, cotton, textiles, clothing, and flowers, to name just a few. You also signed a $190 billion bill to reinstate the federal farm subsidies program, which was scheduled to be phased out. Are these the policies of a “free trade president?

http://www.foxnews.com/story/0,2933,127374,00.html

 

[vanesch]

The most capitalistic nations today can be found here at Exhibit 1.2:
http://www.freetheworld.com/2004/efw2004ch1.pdf
Also look at Exhibit 1.6-1.18 for some correlations of economic freedom, for example with life expectancy, child mortality, child labor, access to water and corruption.

Thanks, that's interesting. So I'm perfectly well where I am actually, in the second percentile Indeed, except for income per capita, all the other parameters are ok. There's the biggest literacy

The statistic that surprises me is that relative income of the 10% poorest people is completely independent of economic organisation. But it indicates that if you provide free health care, housing and schooling for all, that the poor don't suffer so much from their poor income situation, from the moment that you have a reasonably free economy (say above 6 in the document). But that's exactly what I was saying, no ? A reasonable economic organisation has a large part of free market in it. Honestly, above 6 or so, the differences are marginal, except for the average income per capita, which doesn't indicate much because you have to take care about the relative cost of living.

Now, one has to be careful with the results presented in what you showed, because *correlations* do not mean causal relationships per se.

 

[Aquamarine]

There's a small scandal over here, right now: Danone sold (is still selling) a "miraculous energetic drink" called Actimel. I too bought lots of it, especially for my kid, even though it is quite expensive. Now it turns out that those tiny bottles contain... milk with some sugar. Even the marketing director of Danone is poking fun at people: "Ok, this was a well-thought campain, but even in my wildest dreams I didn't think I would sell so much ordinary milk at such incredible prices"

If there was false information, it was fraud which should be punished by the state.

You're looking in too binary a way. I'm not an "anti-capitalist" if you understand by that an opposer of free market and trade, I said that from the beginning. I do believe that the free market and free trade creates a great deal of wealth and entertainment. What I'm arguing with is the ideology that the free market and trade ALL BY ITSELF solve all problems in the best way thinkable (this ideology is what is called capitalism). I'm arguing that state regulation in order to impose certain political goals a society might have is an option that is not necessarily a bad thing, EVEN if it leads to a lower GNP.
The ideal capitalist society has a state that has only one function: that is the protection of property and keeping public order, together with a justice department that solves quarrels among economic agents, and a very small amount of taxes is raised to do so. You don't even need politicians or elections or democracy for that. The function is so minimal that it doesn't matter who organizes it. All the rest is done by the market mechanism, and private initiative. No wellfare, public research, public health care. I'm telling you that I can imagine societies that don't want to live that way. An example of a political desire that cannot be realized is that poor people cannot send out any market signals anymore, so their needs are not taken into account. Society will allocate more ressources to make mobile phones, instead of solving their, much more basic problems.
I think that a certain amount of state regulation is needed, in order to impose a political view of society. And that is blasphemy in the ears of capitalists.

Interesting discussion. Actually, there are many necessary regulations that cannot easily be decided even in the most capitalistic society. For example, why should patents be protected 20 years and not 10 years? And why can one not patent a certain way to organize business or a new mathematical idea? The patent laws have been decided arbitrarily without evidence that the current way is the best.

And is not possible to know the best way by controlling all variables in experiments on the scale of societies. So to me it seems that the best way is social darwinism. That is, there should be many small societies that compete with somewhat different laws. That way, better laws will emerge through competition. I think that the primary reason that Europe and not China discovered capitalism was that there are more geographical barriers in Europe. This prevented a centralized state and allowed more competition between different systems of law.

Regarding the poor you are wrong. Since capitalism reduces poverty and raises income for all, then corporations will seek the favors of even those with the lowest income. Again, most money is not made from luxury goods to the super-rich but from goods to the common people.

Regarding if money should be taken from telephones to those starving in the third world, the more general question is if the capitalistic countries should provide more foreign aid. One basic problem is that people do not want to do that. If they wanted, they could already give more money to various aid organizations. There is no capitalistic conspiracy that prevents people from giving. Another problem is that foreign aid don't work:
http://www.aworldconnected.org/article.php/302.html
http://www.lp.org/issues/foreign-policy.html

 

[vanesch]

I think that the primary reason that Europe and not China discovered capitalism was that there are more geographical barriers in Europe. This prevented a centralized state and allowed more competition between different systems of law.

Your argument remains intact, but I thought that the discoverers of capitalism were the Mesopotamians (Babylon and all the city states around). They had banks, for instance (but probably no stock options). The Iraqis, say