cab21 Posted April 19, 2015 Posted April 19, 2015 Paul Tudor Jones II: Why we need to rethink capitalism so i watched this video, sounds like he is making a group that is going to take a poll for public opinion on ethics in capitalism. now is it even capitalism if it's done by public opinion, and not socialism?
Daniel Unplugged Posted April 20, 2015 Posted April 20, 2015 Capitalism is synonomous with the free market/voluntary interactions. Socialism is synonomous with government/forced interactions. If government is doing it, then it's socialism, regardless of whether or not it is the will of the majority.
A Madman Person Guy Posted April 20, 2015 Posted April 20, 2015 Capitalism is synonomous with the free market/voluntary interactions. Socialism is synonomous with government/forced interactions. If government is doing it, then it's socialism, regardless of whether or not it is the will of the majority. I wouldn't put it quite that simply, but that's certainly the gist of it. While I would debate the implications of the meaning of "forced", the proposal of using polls as an alternative to calculated market strategies can only be detrimental in the long run to the business of any company that adopts the model. The advantage of a capitalist system is the likewise "forced" operation of making all interested partners behave as rational actors from an economic standpoint (or at least as close to rational actors as you might expect from human beings...). Throwing this out the window is, if not destroying the capitalist model and turning it into another system entirely, then at least squandering the advantages of it. Any system, political or economic, governed by opinion is implicitly doomed to not only fall victim to unworkable business models and idiotic mistakes, due to its human elements' subjectivity, susceptibility to the Moralistic Fallacy and inability to think statistically, but is also likely to experience an inefficiency which corellates directly to the number of opinions and motives of the individuals influencing the system itself.
DaviesMa Posted April 20, 2015 Posted April 20, 2015 The whole video is a self promotional, illogical, wishful thinking mess. I would challenge a few of his tacit and overt assumptions, such as: Huge overvaluations and bubbles in stock markets are a feature of capitalism - i.e. Government interest rates contirbute to an inefficient allocation of capital. Income inequality is not good - i.e. apart from one graph, where is his evidence? Correlation does not create causation. What is his philosophical basis for this Redistribution by tax reduces inequality - i.e. Welfare entrenches poverty for example Corporations have a duty to give to charity in order to be ethical - why? If they have a fiducary duty to maximise profit, what gives them the moral authority to redistribute income without the consent of the individual shareholder? What he is talking about is democracy, not capitalism. As there is no price attached to people expressing their preferences, this is not accurate. There is a Peter Schiff video that illustrates this, where Peter goes into the parking lot of a Walmart and interviews customers, asking if they believe that Walmart Staff should be paid more. When they answer in the affirmative, Peter explains that this will result in higher prices and asks for money to give to the workers. Predictably, they are not too keen to pay with their own money. If he wants to provide information for people then fine, but capitalism in action is choosing who you want to buy from and boycotting those who's values you don't agree with.
Blackout Posted April 23, 2015 Posted April 23, 2015 If parties enter into voluntary and, assuming both are rational, mutally beneficial transactions, what does it mean to say marginal profits are too high? If prices are too high or low, they are the product of a market manipulation on the demand or supply of a good, usually caused by government interference in my opinion. If the price of a good is too high, the market will incentivise someone to come in and undercut the price to make a fortune, thus it is when barriers to entry are erected that prices are kept artificially high. Regulations, patent law, and permitting all such barriers and are controlled by the state and its agencies, therefore it is government that creates immoral markets.
A Madman Person Guy Posted April 25, 2015 Posted April 25, 2015 If parties enter into voluntary and, assuming both are rational, mutally beneficial transactions, what does it mean to say marginal profits are too high? If prices are too high or low, they are the product of a market manipulation on the demand or supply of a good, usually caused by government interference in my opinion. If the price of a good is too high, the market will incentivise someone to come in and undercut the price to make a fortune, thus it is when barriers to entry are erected that prices are kept artificially high. Regulations, patent law, and permitting all such barriers and are controlled by the state and its agencies, therefore it is government that creates immoral markets. Well, too high profit margins does open the door to exploitation and greed, on behalf of either the workers or the company executives. If people just hoard money rather than put it to work, it becomes essentially pointless in the apparatus of the society. You can't rely on public donation and involvement or the altruism of CEOs for the "necessary charities" of society that create the "societal wealth" he's talking about, and forcing a company to put it into its charter to spend its money and time on more public-spirited endeavors might be a good thing... ...to which I'd respond that it's better to leave the door open for greed, hoarding and financial ruthlessness, but still have efficiency and the potential for growth, than rule out those former at the cost of running an effective business and risking stagnation and moral misappropriation. And besides, who decides what charity is "necessary"? Who decides what "social wealth" is desirable? After a long time of observing the man on the street or in the office chair, I for one have no interest in helping the majority of people out there, even those in dire straits. Rather the opposite, in fact. Good will can not supplant, can not fully oppose and should not be allowed to oppose ruthlessness and efficiency in business practice. Good will and altruism shouldn't even be part of the equation, and neither should misanthropy. The only issue should be the cost benefit equation, after the goals are set. Everything that tries to interfere with that or steer the business around is just another stone in the river, a disruption of the path of least resistance and another waste of time and money.
Recommended Posts