Capitalism or Socialism: Which is better?

[Mercator Terra]

Though Austrian Economics understands that people (be it rational or not) tend to buy the cheapest item with the most quality.

*cough*

Im to tired to read it. What is it?

[Sociobiology]

we do, a representative democracy, if you don't understand the concept of overlapping definitions then school did fail you or possibly vice versa.

It's not over lapping. In a democracy the people or their representatives are the final say. In a Republic there are checks and balances to prevent anyone from abusing power, and that includes voters.

unless it is a constitution democracy, or a constitutional representative democracy,. as opposed to oligarchies, aristocracies, which are forms of republics, as are democracies. the soviet union was a republic as well.

republics are defined by a lack of a monarchy and a were the people or some subdivision of them, hold control of the government.

If you don't understand a word look it up. better yet even if you think you do understand a word, look it up anyway.

The USA is a Constitutional Representative Democratic, Secular, Mixed-economic, Republic.

[New Hampshyre]

No, it is not. You did not talk about government in the quoted post, you talked about four different ways of spending money. Economics says there are no four different ways. There is one way, subject to the same decision mechanism. It was a bad argument, so I pointed that out.

How the hell is it a bad argument? If I need to buy a car, who is going to do a better job, me, spending my money, or some politician spending my money? He does not know my situation, preferences, needs, income constraints, future plans, ect. I do. He doesn't lose anything by spending my money, I do. It is FRICKING OBVIOUS that I'm going to be able to make a better choice!

But for that you'd have to argue that the opportunity cost to society

Society doesn't spend out money, politicians do. And politicians bear just about 0 opportunity cost when they spend our money on pork barrel projects and other forms of vote-buying. It is just like the tragedy of the commons problem. If the resource is available to all comers, as American tax dollars are to politicians, then the resource is going to be over-exploited and inefficiently used.

There is no reason you've provided as to why a government should not be capable of applying economic valuation principles rigourously and hence allocate funds efficiently.

1: They physically are unable to know everything the market "knows" and uses to make billions of calculations a day.

2: Politicians have incentives to intentionally mis-allocate resources in order to buy votes.

Private individuals possess more relevant information concerning transactions they are making than anyone else and they have more incentives to make sure their money is spent efficiently than anyone else does.

Didn't think it was necessary. You talked about a general situation. You or me spending money, for example. And then you sought to bend those examples to fit the problems you have with government planning.

The government is made up of people... You or me are people... So what is the problem? Are politicians and bureaucrats some special breed of people who are guaranteed to be benevolent and infallible and some how have access to information it is impossible for any 1 normal person to have?

Nope. But given people were complaining about each others' economics knowledge in this threat, I felt that it wouldn't be too out of place to pick on bad or pseudo-economic arguments.

Ohh, I see. So the entire reason why you're trying to argue that my argument is no good is because you felt bad for the guy who thought polls can replace price mechanisms. It makes more sense now.

If the government doesn't spend the money, it doesn't need to borrow it.

But the government isn't a single being, stop pretending like you don't know that. It is composed of many politicians each trying to secure a power base. And each one of them knows that if he doesn't grab a share of the tax payer pie, it will just be gobbled up by someone else.

On top of that there could be any efficiency losses to the market as a whole, which in some cost-benefit analysis applications is actually considered.

There is most DEFINITELY efficiency losses, but that the cost of that is spread out over millions or hundreds of millions, making it effectively 0 for the politician and unnoticeable by the populace. But, the "benefits" of his vote buying are highly concentrated and highly visible.

If all of society was a single being, what you're saying would be absolutely true. But it's not. And you have to take that into account.

Agreed.

But that's not the argument you made

some would say it's not even an argument against central planning as such, just against its applications at the moment. (I'm not one of those people, I think it's an incentive problem innate to government.)

If you already know why the argument isn't a strong one, why bother mentioning it, lol? If someone ACTUALLY has that objection, then we can both address it.

Meh, so is free-riding on services one hasn't paid for.

No, it's not all theft. If I go to work happy, my co-workers benefit from that and so they are slight free-riders from my happiness. But this is not theft because they have not taken anything of mine from me without my permission.

If my neighbor builds an extension on his home and raises neighborhood home values, I have been made into a free-rider, but again I am not a thief.

Negative externalities can be considered theft because they force costs on others without their permission, but I'm having a hard time imagining a case where a positive externalities would be morally equivalent to theft. Positive externalities and free-riding can make things economically imperfect, but they don't cause ethical problems.

Not all government spending is inexcusable.

Depends on how the money it uses is acquired. I could care less if it spends money on stupid stuff it it got its funds through voluntary means. But if it got its funds through involuntary means then the only time I can see its actions as being excusable is if it uses that money to stop more force and fraud then it used to get the funds in the first place. And even that might lead to questionable territories.

[Mercator Terra]

It's not over lapping. In a democracy the people or their representatives are the final say. In a Republic there are checks and balances to prevent anyone from abusing power, and that includes voters.

unless it is a constitution democracy, or a constitutional representative democracy,. as opposed to oligarchies, aristocracies, which are forms of republics, as are democracies. the soviet union was a republic as well.

republics are defined by a lack of a monarchy and a were the people or some subdivision of them, hold control of the government.

If you don't understand a word look it up. better yet even if you think you do understand a word, look it up anyway.

The USA is a Constitutional Representative Democratic, Secular, Mixed-economic, Republic.

Still wouldn't call it a democracy.

[New Hampshyre]

that rational choice theory was the dominate paradigm fro many years and is being replaced by Behavioral economics is a subjective belief?

The rational choice theory doesn't need every person to be 100% rational 100% of the time, or to be infallible or anything like that. Assumes that people act rationally because most of the time, most people DO act rationally. It must make that assumption because calculating for millions of exceptions is not feasible. It doesn't introduce large amounts of error because in the vast majority of cases, even if some people are irrational, people tend to be so in random ways. About the same amount will be irrational in one way, as they will be irrational in the opposite way. This phenomenon can actually be pretty powerful. It is what causes groups of people guessing at how many jelly beans are in a jar to be VERY accurate when the answers are averaged out.

There are SOME cases where systematic biases form for various reasons, and these can and should be accounted for once identified, but in the vast majority of cases, this is not necessary.

[New Hampshyre]

Serious behavioural economics is more supplementary rather than contrary to rational choice theories, nobody ever thought that people were always rational, only that in aggregate, the majority act rational (and rational in economics means something quite specific and not unreasonable, it is not the same as 'logical' and absolutely not the same as omnipotent), and that irregularities and anomalies tend to balance each other out. The only thing of any relevance is biased or consistent irrationality, rather than random irrationality, which has always been known about, but, it being unbiased, is just noise and has little affect on models. There has been much empirical work on this, it is by no means conjecture.

Very intelligent statement. It's much appreciated.

[New Hampshyre]

What are your views on agorism?

Never heard the term before but after a very brief look it seems to be the same thing as Voluntarism.

It would be awesome, and I hope it can be found to be possible, but I'm not all that confident that it will be.

Stefan Molyneux at Freedomainradio.com is the voluntarist I've paid the most attention to.

[New Hampshyre]

If you don't understand a word look it up. better yet even if you think you do understand a word, look it up anyway.

Ohh STFU dude. Humans do not learn the language through the dictionary, they learn it through using the language. I've gained my definition of what a Republic is through reading texts on political philosophy, law, and discussing the subjects with others.

Take, for example, this:

http://www.1215.org/lawnotes/lawnotes/repvsdem.htm

"A republic and a democracy are identical in every aspect except one. In a republic the sovereignty is in each individual person. In a democracy the sovereignty is in the group."

That is what I'm talking about. Maybe the term has been often mis-used or used differently in other places and times but this is how I've come to understand it and I find it to be a hell of a lot more meaningful then your pointlessly bland dictionary definition.

Edit: This is a good thing for you to take a look at, it's a pretty good description of what I'm talking about and shows why it is important: http://www.youtube.com/watch?v=KFXuGIpsdE0

[Sociobiology]

If you don't understand a word look it up. better yet even if you think you do understand a word, look it up anyway.

Ohh STFU dude. Humans do not learn the language through the dictionary, they learn it through using the language. I've gained my definition of what a Republic is through reading texts on political philosophy, law, and discussing the subjects with others.

Take, for example, this:

http://www.1215.org/lawnotes/lawnotes/repvsdem.htm

"A republic and a democracy are identical in every aspect except one. In a republic the sovereignty is in each individual person. In a democracy the sovereignty is in the group."

That is what I'm talking about. Maybe the term has been often mis-used or used differently in other places and times but this is how I've come to understand it and I find it to be a hell of a lot more meaningful then your pointlessly bland dictionary definition.

and you think the definition used by some random website's interpretation has preference of the actual meaning of a word or for that matter the legal definition of a word.
well by that logic, I interpret the right to bear arms as the right to mount bear's arms on your wall and persons to mean only those that agree with me.
how about we use the definition at the time of the writing of the constitution were republic meant a government without a monarch
or the legal definition, Republic : A form of government where the law-makers and administrators are chosen by the people and not king or queen, or chosen thereby.
if your really want to go by common usage north Korea and the USSR were both republics.

[Neu Leonstein]

I think he was less advocating the gold standard and more reiterating the problems with fiat currencies.Devaluation and subsequent busts being one of those problems.

I myself am for using a multitude of precious metals (gold, silver, platinum, etc)

The obsessive need to hold on to an (afterall no less artificial) valuation was what made the Great Depression "great". Flexibility for currencies to move and central banks to provide liquidity and cut real rates are good things. Yes, you need good safeguards to make sure governments don't get their hands on printing presses, but we have that as it is. And it works.

You should buy these books:

this book
and this book

I've studied economics for six years, and am currently working in monetary economics. Hell, there's a half-decent chance I'll be studying another year soonishly.

I have moved somewhat beyond the need for people like Hazlitt. And for that matter, I'm not sure whether even beginners have need for that particular piece. You're better off just buying a normal intro textbook.

[Neu Leonstein]

Ohh, I see. So the entire reason why you're trying to argue that my argument is no good is because you felt bad for the guy who thought polls can replace price mechanisms. It makes more sense now.

Well, kinda. I was really more taking offense to a bunch of boringly interchangable libertarians throwing around the usual (and seriously, I have had Hazlitt quoted at me since 2003, I'm over it) arguments about how nobody else knows economics. And I say that as one of the more right-wing, libertarian people here.

If you disagree with him, that's fine. If his arguments are bad, point it out, as you have. All fine. But don't mischaracterise the field of economics to fit a political point. Market failures exist. It is not impossible for us to understand them, to see them and indeed to remedy them, if we have an agent in the economy which is capable of disseminating information effectively without a need to immediately earn a private return for doing so. Government has a point - see the field of mechanism design, for example.

Furthermore, in economics, the concept of the social planner is well-established. It is not at all a priori a given that a social planner of that theoretical kind would not be a superior outcome to the market. I for one think there is little doubt that it would be. It's just that it is a theoretical concept and there are the various principal-agent and information problems that keep it in the realm of math rather than physical application. If you're going to make moral or ethical arguments, as you have when you started about theft, then you're not up against government as it exists, but against government as it could be, all the way to the social planner from theoretical economics. It is important as far as I'm concerned to keep the two explicitly separate.

[Quailtopia]

*cough*

Im to tired to read it. What is it?

The study showed that people shop in grocery stores based on what is at eye level, brand recognition, and size of package. It tested high school through phd level education, and almost everyone said that they purchased food based on price/ounce, etc, and some even brought calculators with them. It didn't have any effect on behavior.

tl;dr the bolded quotation is incorrect.

[Quailtopia]

If you don't understand a word look it up. better yet even if you think you do understand a word, look it up anyway.

Ohh STFU dude. Humans do not learn the language through the dictionary, they learn it through using the language. I've gained my definition of what a Republic is through reading texts on political philosophy, law, and discussing the subjects with others.

and you think the definition used by some random website's interpretation has preference of the actual meaning of a word or for that matter the legal definition of a word.

I like how people ignore language drift, even today. Its adorable.

You probably think Latin is somehow magical and accesses platonic forms or something XD

[New Hampshyre]

and you think the definition used by some random website's interpretation has preference of the actual meaning of a word or for that matter the legal definition of a word.

www.lexrex.com/enlightened/AmericanIdea ... emrep.html
www.youtube.com/watch?v=KFXuGIpsdE0
www.c4cg.org/republic.htm
www.freerepublic.com/focus/f-news/1351222/posts
www.albatrus.org/english/goverment/gove ... ubblic.htm
www.serendipity.li/jsmill/baska01.htm
www.dailypaul.com/node/1958
www.detaxcanada.org/repub1.htm
www.garymcleod.org/republic.htm
ezinearticles.com/?Republic-vs-Democracy---Rule-by-Law-vs-Rule-by-Majority&id=933599
www.citizensforaconstitutionalrepublic. ... -5-05.html

A "Republic" isn't so simple as to be explained properly by a simple dictionary entry. The differences between a Republic and a Democracy are often discussed in political philosophy and you get a much more complete understanding from those discussions than you can get with some shallow dictionary definition.

The founding fathers didn't include the word "democracy" in the Constitution even once, and neither does it appear in any of the 50 state Constitutions. This is for a very important reason. If you want to talk about why, great, if you just want to ignore the political philosophy and promote the use of dictionaries then that's fine too, but I find that to be a lot less interesting.

well by that logic, I interpret the right to bear arms as the right to mount bear's arms on your wall and persons to mean only those that agree with me.

Is that based on a serious philosophical discussion? If not then it has no bearing on the matter at hand.

how about we use the definition at the time of the writing of the constitution were republic meant a government without a monarch

That's not all it meant. They could have called it a democracy if they meant only that. But they were strongly opposed to democracy as well as monarchy and oligarchy. That is why they made a Republic, which limits the power of the government by LAW. It is LAW that has the final say in a Republic, not the people, not the ruling class. Through that law the Republic protects our individual rights.

or the legal definition, Republic : A form of government where the law-makers and administrators are chosen by the people and not king or queen, or chosen thereby.
if your really want to go by common usage north Korea and the USSR were both republics.

All you're doing is showing off your ignorance of the larger discussion. You're not even being consistent with your own definition. If North Korea isn't a monarchy then no government is.

[Neu Leonstein]

tl;dr the bolded quotation is incorrect.

While we're at it, just thought this one was interesting:
http://www.economist.com/node/17723028? ... d=17723028

[...]

Too much choice, concluded Sheena Iyengar of Columbia University and Mark Lepper of Stanford, is demotivating. Others have since come up with similar results from experiments with writing pens, gift boxes, coffee and even American 401(k) pension plans. [...]

As options multiply, there may be a point at which the effort required to obtain enough information to be able to distinguish sensibly between alternatives outweighs the benefit to the consumer of the extra choice. “At this point”, writes Barry Schwartz in “The Paradox of Choice”, “choice no longer liberates, but debilitates. It might even be said to tyrannise.” In other words, as Mr Schwartz puts it, “the fact that some choice is good doesn’t necessarily mean that more choice is better.”

[...]

[Quailtopia]

I decided to be nice and clarify. How many things has fag meant over the years? It used to be a derogatory term for old people, then it was poor people, and now its THE GAYS!

Words change meaning as people decide to use them in different ways. A good link on this is here, if you want to read more about it.

[New Hampshyre]

The study showed that people shop in grocery stores based on what is at eye level, brand recognition, and size of package. It tested high school through phd level education, and almost everyone said that they purchased food based on price/ounce, etc, and some even brought calculators with them. It didn't have any effect on behavior.

Maybe for a whole lot of people that is true... But I KNOW I don't do that. Well, brand recognition I do but brand recognition is rational. Once you respect a companies product it is rational to choose it over an unknown brand (all else being the same).

I've bought small jars of peanut butter when I noticed they were cheaper per ounce then the larger ones. I've bought individual light bulbs when I noticed that the same type of light bulb was more expensive when bought in bulk. I buy the cheap cereal and soups on the bottom shelves.

It's an interesting experiment though.

[New Hampshyre]

While we're at it, just thought this one was interesting:

I've read about that before, it makes me laugh. If people are REALLY being plagued by too much choice they can always just a flip a coin. If there is a million choices of shampoo at the store then all the "victim" of too much choice has to do is stop and think for a moment. Once they realize that any random group of shampoo is likely to be as good as any other, and that it simply isn't worth worrying about too many choices, they should decide to just compare a small fraction of the possible choices and go with that.

That is FAR from "tyranny", the article you linked was exaggeration a wee bit when it used that word. Maybe some irrational (just plain dumb?) people out there stress over the million of possible Christmas presents they can give people every year, but I don't see it ever becoming a serious problem.

[Neu Leonstein]

I've read about that before, it makes me laugh...

There's no question people can decide. It's not often that people literally end up buying nothing because it's too hard. But the point is that the additional effort, even to flip a coin (or more realistically, dealing with all the "could have beens" mentally), is a transaction cost. And it's not one that is currently in the standard models.

[Quailtopia]

While we're at it, just thought this one was interesting:

I've read about that before, it makes me laugh. If people are REALLY being plagued by too much choice they can always just a flip a coin.

No you can't. Well, I guess one could in theory, but people don't think that way, even if they say they do. That phenomenon is in that last paper I cited earlier as well. People say they figure out the price/ounce and how ridiculous it would be to interact on a different level, and yet thats what they do. You don't have control of the situation, regardless of actually being there.

Anyway, I usually cite that experiment as an example of how basic Austrian school theory/assumptions are incorrect.

[Quailtopia]

And anyway, this thread has continued going long past its point of usefulness and coherence. People don't read 120 pages of assumptions, especially when the thread title makes it clear that the exercise is subjective.

[New Hampshyre]

No you can't. Well, I guess one could in theory, but people don't think that way, even if they say they do. That phenomenon is in that last paper I cited earlier as well. People say they figure out the price/ounce and how ridiculous it would be to interact on a different level, and yet thats what they do. You don't have control of the situation, regardless of actually being there.

Of course people do, though they often don't care to take control. For a lot of people it is just isn't rational to be that focused on the small things. Its rational ignorance. The issue at hand (price per ounce) simply isn't worth stressing out over so people don't commonly do it. They might not consciously make the choice not to, but it is still rational because for most people being that picky just makes for a miserable waste of time that isn't worth the relatively small savings. They are being subconsciously rational. If we were a lot more poor, to the point where we were desperate for a little more savings, we would almost certainly pay more attention because then it would be worth it for us (or if the savings were a WHOLE lot bigger).

Truly irrational behavior is REALLY hard to find because we humans have evolved over a ridiculously long time and truly irrational behavior has never once given us an evolutionary advantage. You might be able to find individuals who are irrational, but you'll be hard pressed to find all/most of humanity to be irrational about very many things. Even stuff like religious behavior, which seems to be irrational at first, actually has a rational basis in ensuring survival because it binds people together and strengthens communities (Or, at least it did for a very long time, today it might cause more net harm then good)

Or at least that's my theory anyhow.

[Staenwald]

I decided to be nice and clarify. How many things has fag meant over the years? It used to be a derogatory term for old people, then it was poor people, and now its THE GAYS!

Words change meaning as people decide to use them in different ways. A good link on this is here, if you want to read more about it.

it means cigarette in the UK too xD

[Staenwald]

{quote="Arilando";p="4235838"]

Thats far less efficient than a free market. In a poll here in england once, people were asked questions and the overwhelming outcome was - more public services, less taxes. That's not even possible.

What the fuck are you talking about there are no taxes in a planned economy [/quote]

What the fuck are you talking about, I was just talking about how inefficient it is to ask the public anything about prices and services, because they'll always ask for more service/products and lower prices. This si the way to a better economy yes, but markets do this trhough creating better tools of production, governments just increase taxes, which they couldnt do if they wanted more public services for less taxes.

[Norstal]

What the fuck are you talking about, I was just talking about how inefficient it is to ask the public anything about prices and services, because they'll always ask for more service/products and lower prices. This si the way to a better economy yes, but markets do this trhough creating better tools of production, governments just increase taxes, which they couldnt do if they wanted more public services for less taxes.

But in a planned economy, the government don't need to levy taxes because they can just shit money. They can trade shit for things like apples or oranges. The less moist the shit is, the more valuable it is.