top 10 arguments in favour of capitalism debunked.

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thomas81
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01 May 2014, 4:33 pm

[youtube]http://www.youtube.com/watch?v=pI6a7WySFsU[/youtube]


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GGPViper
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01 May 2014, 5:21 pm

Here is a short commentary to each point:

10. Capitalism promotes innovation:

True.

http://rpsychologist.com/img/PubMed_pub ... capita.png

9. Free markets increase economic development.

True.

I have 500 million reasons why this is true. They are all in Chinese, though.

8. But aren't markets a rational means of organising economic life?

See my response to (9). Apparently more rational than alternatives... also see my response to (1)

7. But surely we can prevent bad business practices through ethical consumerism.

Ethical consumerism has nothing to do with capitalism. Why is it even in the video?

6. Don't government regulations address the question of bad practices?

They do.

Centuries - nay, millennia - of legal developments have provided a framework which allows individuals who have never seen each other and do not speak the same language to benefit from trade by establishing laws of property, business, commercial agreements etc.

Also see my responses to (10) and (9).

5. But don't you buy things from corporations? Don't that make you a hypocrite?

The video provided no explanation here other than invoking Godwin's Law.

4. Capitalists put risk in their businesses! Surely, they should own them!

... another Godwin's Law.

... and here is a good one from the video: "There may have been economic risks for setting up slave plantations"

3. But living standards improve overall, even for the poor!

... Apparently, the author of the video doesn't care about the living standards of the poor. See my response to (9).

... and *another* Godwin's Law...

2. But capitalism is a result of human nature!

Partly true. Capitalism works because of human nature.

http://www.uvm.edu/~pdodds/files/papers ... n1964a.pdf
http://www.nbb.cornell.edu/wkoenig/wick ... 201971.pdf

The only way a socialist system can work is if human beings had evolved through group selection. All but a few biologists (like E.O. Wilson and & D.S. Wilson) reject this as extremely implausible. As a result, individual self-interest is both (1) theoretically expected by biology and (2) empirically observed by economics to be a dominant feature in human motivation.

1. Capitalism is the only system that's possible. There is no alternative!

... "a study published in a journal called Ecological Economics...

Ecological Economics is not a scientific discipline. It assumes that it can derive ought from is. It cannot.

Oh, and... (another gem):

"By alternatives, I do not mean some centrally planned Leninist State. I mean libertarian socialism, in which the workers - not the government - own and control the means of production, and the surplus producing workers control the surplus. The anarchy-syndicalists of the Spanish managed to create a working alternative to capitalism, taking the Spanish economy under worker control, expanding the health care system and improving literacy rates."

... the Spanish Anarchy-Syndicalists, like the Paris Commune, failed miserably in the end...

Oh, and this: http://en.wikipedia.org/wiki/Nirvana_fallacy

Summary
1. Capitalism has outperformed any other economic system by massive margins in its efficiency and its ability to create wealth and alleviate poverty.

2. The only real threat to capitalism is its inability to tackle environmental issues, but apparently a lot of people consider it a higher priority to compare capitalism to failed has-been and never-was ideologies.

3. The intellectual level presented in the video was below that of a 15 year old.

EDIT: My apologies. There are many who are 15 year old or younger who vastly surpass the intellectual level presented in the video.


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Kurgan
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01 May 2014, 5:28 pm

All great nations were built by capitalists, not by government owned coorporations or politicians. The US became the most powerful nation in the world not because of anyone on the Mt. Rushmore, but because of Vanderbilt, Rockefeller, Ford, and Gates. So far, no socialist nation has ever reached western-European living conditions.


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01 May 2014, 6:51 pm

GGPViper wrote:
3. The intellectual level presented in the video was below that of a 15 year old.
EDIT: My apologies. There are many who are 15 year old or younger who vastly surpass the intellectual level presented in the video.


LOL This^

A good argument is ...

"Crony capitalism is the inevitable result of any capitalist system. Jane Jacobs described it as a natural consequence of collusion between those managing power and trade, while Noam Chomsky has argued that the word "crony" is superfluous when describing capitalism. Since businesses make money and money leads to political power, business will inevitably use their power to influence governments".

source, http://en.wikipedia.org/wiki/Crony_capitalism

Analogous to the argument that a "Socialist Utopia" is never achievable; some argue that laissez-faire Capitalism is never achievable either.


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Kurgan
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01 May 2014, 7:24 pm

Money can influence politicians in socialist countries as well. Most communist dictators have massive fortunes and live a life of luxury--and they're not keen on sharing. Much of the USSR imperialism was due to the fact that their weak economy meant that they had to take capital from other nations.

No amount of money can set you free from the antitrust laws, for instance.


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01 May 2014, 7:32 pm

To quote a phrase: "Money talks and bullshit walks."


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thomas81
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01 May 2014, 11:16 pm

Kurgan wrote:
All great nations were built by capitalists,


Capitalism is only a couple of centuries old. You are arguing there were no 'great nations' before capitalism?


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thomas81
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01 May 2014, 11:21 pm

GGPViper wrote:

9. Free markets increase economic development.

True.

I have 500 million reasons why this is true. They are all in Chinese, though.

8. But aren't markets a rational means of organising economic life?

See my response to (9). Apparently more rational than alternatives... also see my response to (1)
.

You should really stop using the Chinese analogy, it is very weak.

As I already laid out in a previous thread, the Chinese model has not been conducive to a more equitable society. Quite the contrary. Its only served the gravitation of wealth to the top, at a great expense to those that this graviation is dependent on.

Life in China is horrible for ordinary people and not something western countries should want to emulate.

Remember the nets?
Image


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01001011
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01 May 2014, 11:22 pm

GGPViper wrote:
9. Free markets increase economic development.

True.

I have 500 million reasons why this is true. They are all in Chinese, though.


I want way China is free market capitalism?



GGPViper
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02 May 2014, 1:57 am

thomas81 wrote:
GGPViper wrote:
9. Free markets increase economic development.

True.

I have 500 million reasons why this is true. They are all in Chinese, though.

8. But aren't markets a rational means of organising economic life?

See my response to (9). Apparently more rational than alternatives... also see my response to (1)

You should really stop using the Chinese analogy, it is very weak.

As I already laid out in a previous thread, the Chinese model has not been conducive to a more equitable society. Quite the contrary. Its only served the gravitation of wealth to the top, at a great expense to those that this gravitation is dependent on.

No. It is very strong, and your last claim in italics is a blatant lie.

Image

This also amply illustrates the weakness - and to a great extent, the irrelevance - of equality as a development goal. The greatest alleviation of poverty in the history of mankind has coincided with a large increase in inequality.

So you could post pictures of a thousand suicide nets, and it still wouldn't even make a noticeable dent in the vast social achievements of capitalism in China.


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02 May 2014, 4:24 am

GGPViper wrote:
thomas81 wrote:
GGPViper wrote:
9. Free markets increase economic development.

True.

I have 500 million reasons why this is true. They are all in Chinese, though.

8. But aren't markets a rational means of organising economic life?

See my response to (9). Apparently more rational than alternatives... also see my response to (1)

You should really stop using the Chinese analogy, it is very weak.

As I already laid out in a previous thread, the Chinese model has not been conducive to a more equitable society. Quite the contrary. Its only served the gravitation of wealth to the top, at a great expense to those that this gravitation is dependent on.

No. It is very strong, and your last claim in italics is a blatant lie.

<snipped image>

This also amply illustrates the weakness - and to a great extent, the irrelevance - of equality as a development goal. The greatest alleviation of poverty in the history of mankind has coincided with a large increase in inequality.

So you could post pictures of a thousand suicide nets, and it still wouldn't even make a noticeable dent in the vast social achievements of capitalism in China.

It only does so if you assume that reducing poverty is the only goal of development. Inequality brings a whole raft of new social problems. It is definitely a good thing that China has managed to raise so many out of poverty, but saving people from starvation is undermined somewhat if they just throw themselves off of a building, or spend their life dealing with depression, or working 18 hour shifts in horrible factory conditions.

And of course, China is not the only country to have massively reduced poverty and increased GDP in recent years.

[img][800:634]http://static.guim.co.uk/sys-images/Guardian/Pix/pictures/2013/3/7/1362655807377/Venezuela-key-indicators--001.jpg[/img]

The country above? Venezuela.

I admire neither China nor Chavez, and I don't think an economic system based largely around oil exports is a good way to go, but it's not pretend there is only one way to go.

GGPViper wrote:
2. But capitalism is a result of human nature!

Partly true. Capitalism works because of human nature.

http://www.uvm.edu/~pdodds/files/papers ... n1964a.pdf
http://www.nbb.cornell.edu/wkoenig/wick ... 201971.pdf

The only way a socialist system can work is if human beings had evolved through group selection. All but a few biologists (like E.O. Wilson and & D.S. Wilson) reject this as extremely implausible. As a result, individual self-interest is both (1) theoretically expected by biology and (2) empirically observed by economics to be a dominant feature in human motivation.

1. Capitalism is the only system that's possible. There is no alternative!

... "a study published in a journal called Ecological Economics...

Ecological Economics is not a scientific discipline. It assumes that it can derive ought from is. It cannot.

QED.

(I do agree with most of what you say though)



Last edited by The_Walrus on 02 May 2014, 8:52 am, edited 1 time in total.

GGPViper
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02 May 2014, 5:46 am

The_Walrus wrote:
It only does so if you assume that reducing poverty is the only goal of development. Inequality brings a whole raft of new social problems. It is definitely a good thing that China has managed to raise so many out of poverty, but saving people from starvation is undermined somewhat if they just throw themselves off of a building, or spend their life dealing with depression, or working 18 hour shifts in horrible factory conditions.

*sigh* I do not see 500 million people throwing themselves off a building. Like I said before... not even a noticeable dent.

And I think it is quite presumptuous for someone living in a wealthy western country to attempt to speak on behalf of Chinese citizens when evaluating if they prefer starvation over depression and long working hours.

Furthermore, my previously posted graph actually demonstrates why reducing poverty perhaps should be the only goal of development. When China tried to create economic development and equality at the same time, they created the greatest genocide in the history of mankind (The Great Leap Forward).

'Tis what wise men (von Neumann & Morgenstern, 1944) said:

A guiding principle cannot be formulated by the requirement of maximizing two (or more) functions at once.

The_Walrus wrote:
And of course, China is not the only country to have massively reduced poverty and increased GDP in recent years.

[image omitted for brevity]

The country above? Venezuela.

I admire neither China nor Chavez, and I don't think an economic system based largely around oil exports is a good way to go, but it's not pretend there is only one way to go.

Well, since you pointed it out yourself...

Here are export tree-maps China and Venezuela. It should be quite obvious which one is which:

Image Image

Obviously fake oil state is obviously fake.

... just like another "socialist state" - and a favourite of the OP - Gaddafi Libya:
http://www.wrongplanet.net/postp5405030 ... t=#5405030

The economy of a country that derives more than 95 percent of its export on fossil fuels sitting in the ground cannot be considered a legitimate example of economic development. I could found a successful nation based on the concept of Teletubbies worship if that nation just happened to have massive oil reserves that I could get rich off by selling without lifting a finger.

Furthermore, Saudi Arabia actually scores higher than both Venezuela and China on the Human Development Index (HDI). For some arcane reason, though, I am reluctant to consider Sharia Law a policy prescription for economic development.


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02 May 2014, 10:33 am

GGPViper wrote:
The_Walrus wrote:
It only does so if you assume that reducing poverty is the only goal of development. Inequality brings a whole raft of new social problems. It is definitely a good thing that China has managed to raise so many out of poverty, but saving people from starvation is undermined somewhat if they just throw themselves off of a building, or spend their life dealing with depression, or working 18 hour shifts in horrible factory conditions.

*sigh* I do not see 500 million people throwing themselves off a building. Like I said before... not even a noticeable dent.

Personally, I was using "throwing yourself off a building" as a metaphor for suicide.
Around 7-8% of young Chinese people have attempted suicide (according to peer-reviewed survey-based studies in both urban and rural areas). In a country as big as China, that's a lot of people.
Quote:
And I think it is quite presumptuous for someone living in a wealthy western country to attempt to speak on behalf of Chinese citizens when evaluating if they prefer starvation over depression and long working hours.

Please stop addressing my friend Mr Straw. You will notice I did not say anyone would "prefer starvation over depression and long working hours". I merely said that the good of saving people from a horrible death is undermined somewhat if they have to live a horrible life.

Suicide, depression, and extortionate hours are far from the only social problems correlated strongly with inequality. Less equal societies have shorter life expectancies (particularly amongst those at the tail end), whereas there is no correlation between GDP and life expectancy amongst the richer countries. It goes without saying that Zambia would be better off with more money, but Greece and Israel see little difference in life expectancy despite half the GDP of Norway and the USA. The same is true for literacy, homicide rate, obesity, and imprisonment.

According to a study of 23 rich countries and 50+1 American states, child well-being (as defined by UNICEF) correlates with inequality and relative poverty, but not income.

Tackling poverty by creating wealth is of course a good thing, but we must not neglect to tackle excessive inequality and the issues it causes too.
Quote:
Furthermore, my previously posted graph actually demonstrates why reducing poverty perhaps should be the only goal of development. When China tried to create economic development and equality at the same time, they created the greatest genocide in the history of mankind (The Great Leap Forward).

Again, this isn't universal. The streets of Britain were not littered with corpses in 1946 when the Atlee government pursued both (though we should allow for the assistance from the American government and a proceeding period of :ahem: economic stagnation...). If we exclude oil states and tax havens, Norway is the richest country in the world (GDP per capita PPP), but it is far more "equal" than the next country, the USA, and has a higher HDI score.
Quote:
'Tis what wise men (von Neumann & Morgenstern, 1944) said:

A guiding principle cannot be formulated by the requirement of maximizing two (or more) functions at once.

Quite. However, there is no need to maximise either equality or GDP simply for the sake of it - in fact, there could be thresholds above which increasing these things is actively undesirable. We should aim to balance both as part of an attempt to maximise wellbeing, which is ultimately what matters, rather than proxy measures.



thomas81
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02 May 2014, 11:17 am

The_Walrus wrote:
[
It only does so if you assume that reducing poverty is the only goal of development. Inequality brings a whole raft of new social problems. It is definitely a good thing that China has managed to raise so many out of poverty, but saving people from starvation is undermined somewhat if they just throw themselves off of a building, or spend their life dealing with depression, or working 18 hour shifts in horrible factory conditions.


This, pretty much. The goal of economic development should not be zero sum as GGP Viper or those who support his view would have us believe. The point about the suicide nets is an important one because how much worse could things have been before if they have only started appearing with the new ubiquitous corporations?

As Walrus says, wealth creation for its own sake is meaningless if those who its supporters claim its supposed to benefit are chattled to manufacturing lines or call centres for most of their lives. Wealth creation can only have meaningful social efficacy with a number of extenuating qualifiers, including but not limited to-

* That a significant proportion of affected population are able to access this wealth with demonstratable associated benefits in improved health and education.
* That affected workers are receiving dignified working conditions and pay
* That there is tangible evidence that improvements in living standards are both sustainable, and progressive with improving work conditions, pay and/or reducing hours

I fear that China fails on all three fronts here. I don't think India should get off lightly either. We are seeing analogous rampant exploitation there which is only amplified because of the horrible caste system.


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02 May 2014, 11:37 am

All the "evils" of suicide nets, inequality, poverty is because of government, not capitalism.

The Chinese government pegs the Yuan to other currencies. If government let the Yuan rise, then the Chinese worker would see pay increases (though purchasing power of their money). Also, these people are not being forced to take these jobs.

Prospective Chinese workers line up for an interview at the infamous FoxConn

Image

source, http://www.ibtimes.com/what-its-really- ... one-789308


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