PROFIT

[Vittos Ordination]

There are many posters, most of the posters I would say, who have serious problems with market systems and believe that they do not work for the interests of the people.

Instead, these posters believe that the market is ran and geared towards greedy individuals making profit and that because of this the market simply ignores the people.

I would just like to get an understanding of what these posters think of profit. Define and explain profit. How is it made? Where does it go? Is it a true destroyer of society, or is it just a boogeyman?

[OMGeverynameistaken]

Ideally a market DOES work for the interests of the common people. Sadly, an ideal free market is about as common as a functioning communist state.

[Kashindahar]

Off the top of my head, profit's what you get from a sale after costs are deducted. Profit is generally used to increase the strength of the business by being invested, either back into the company in the form of more/better machinery/workers/materials or into other organisations for increased cash flow/ties with said businesses/what-have-you.

Is profit an inherently evil taskmaster? No. For example, McDonalds runs a charity in Australia where they provide housing for the families of the sick close to hospitals. They do this not because "It's the right thing to do", but because other people think that it's the right thing to do, and thus are more willing to buy from McDonalds than they otherwise would be. It increases profit.

This isn't to say that profit is an inherently good taskmaster, either, because the person in control of the reins of the corporation might not necessarily believe that such charity, to keep with the example, increases profit, and doesn't bother with it. It's all about the bottom line; if you make more by destroying lives, why shouldn't you destroy lives?

[Whiskey Hill]

Ideally a market DOES work for the interests of the common people. Sadly, an ideal free market is about as common as a functioning communist state.

[Callisdrun]

Ideally a market DOES work for the interests of the common people. Sadly, an ideal free market is about as common as a functioning communist state.

Ideally /thread.

However, we all know that unfortunately this thread will probably go on and on and on.

[Meoton]

Ideally a market DOES work for the interests of the common people. Sadly, an ideal free market is about as common as a functioning communist state.

Agree fully. If common people are working their trades, acquiring their own resources, and selling their own produce it works well. When you have a few people controling the workforce, the resources, the production, and the sales it gets skewed. A few get extremely wealthy off the work of others. Then buy up more resources (ie land, stock, means of production) and get even richer and more powerful. Then the children of these people learn to scam the system and getting even more rich for doing even less. And then lots of people applaud them for being geniuses while attending parties were ice sculpted cherubs pee vodka into punch bowls.
I miss anything?

[Vittos Ordination]

Ideally a market DOES work for the interests of the common people. Sadly, an ideal free market is about as common as a functioning communist state.

Very true. What stops us from having one, and how do we bring about one?

EDIT: To whiskey hill and callisdrun as well.

[Callisdrun]

Ideally a market DOES work for the interests of the common people. Sadly, an ideal free market is about as common as a functioning communist state.

Very true. What stops us from having one, and how do we bring about one?

EDIT: To whiskey hill and callisdrun as well.

Same thing that makes communism fail so epically. Human nature.

[Vittos Ordination]

Ideally a market DOES work for the interests of the common people. Sadly, an ideal free market is about as common as a functioning communist state.

Very true. What stops us from having one, and how do we bring about one?

EDIT: To whiskey hill and callisdrun as well.

Same thing that makes communism fail so epically. Human nature.

Can you provide a little more detail?

[Andaluciae]

Oligopolistic systems breed cronyism and collusion between the primary suppliers and the state, and they seek to erect high barriers to entry to the market through sheer size, the ability to price competition to death and the utilization of regulations that make it impossible for new players to enter the field .

There are also network effects in some cases, and externalities.

All of these, of course, are strong arguments for healthy anti-trust schemes, independent governmental regulators, and some degree of campaign contribution limits.

[Callisdrun]

Ideally a market DOES work for the interests of the common people. Sadly, an ideal free market is about as common as a functioning communist state.

Very true. What stops us from having one, and how do we bring about one?

EDIT: To whiskey hill and callisdrun as well.

Same thing that makes communism fail so epically. Human nature.

Can you provide a little more detail?

The Free Market, ideally, would make life better for everyone if humans were completely rational. They're not.

[Vittos Ordination]

Oligopolistic systems breed cronyism and collusion between the primary suppliers and the state, and they seek to erect high barriers to entry to the market through sheer size, the ability to price competition to death and the utilization of regulations that make it impossible for new players to enter the field.

Is oligopoly natural in markets?

If a business maintains high market share through price competition, why is this a bad thing? I thought that was what we are looking for.

There are also network effects in some cases, and externalities.

Yes, but what is the better solution, government intervention into pricing or entrepreneurship?

[West Failure]

???

[Parnassus]

There are many posters, most of the posters I would say, who have serious problems with market systems and believe that they do not work for the interests of the people.

Instead, these posters believe that the market is ran and geared towards greedy individuals making profit and that because of this the market simply ignores the people.

I would just like to get an understanding of what these posters think of profit. Define and explain profit. How is it made? Where does it go? Is it a true destroyer of society, or is it just a boogeyman?

I think we have to make a distinction between markets and capitalism. I'm anti-capitalist, but not anti-market. I have no problem with profit. I do have a problem with exploitation - and capitalism is necessarily (in the philosophical sense) exploitative.

Market = I make a gadget or provide a service. We negotiate over the price of said gadget/service.

Profit = I make a gadget, spending x dollars to do so. I sell it to you at x+y dollars.

Exploitation = I pay you y dollars to make a gadget (that costs me x dollars in material). I sell it to someone else for x+y+z dollars. I've done nothing and profited by stealing from you, exploiting the fact that you didn't have the x dollars in materials to begin with.

[Vittos Ordination]

I think we have to make a distinction between markets and capitalism. I'm anti-capitalist, but not anti-market. I have no problem with profit. I do have a problem with exploitation - and capitalism is necessarily (in the philosophical sense) exploitative.

I agree with you but I don't believe capitalism to be necessarily exploitative. Some people can own capital simply because they are the best at using it.

[Parnassus]

Some people can own capital simply because they are the best at using it.

How so? Just trying to wrap my mind around the idea. I suppose if you consider a single person owning the materials, making the object, and selling the object as capitalism, then yes; I'd agree. But I don't think that fits the notion of capitalism. Doesn't it involve the selling of labor - which is necessarily exploitative.

[Czardas]

I define profit as step four of any good plan, where step three is "???".

[Vittos Ordination]

Doesn't it involve the selling of labor - which is necessarily exploitative.

The capital use for labor trade involves consumption postponement and risk, which each carry economic value. Someone may simply prefer to sell labor rather than taking the time to build up capital first.

[Neesika]

I have no inherent problem with profit as a concept. I have a problem with profit over ethics, which in many cases in the private sector, is a legislated, legal mandate.

[The Snake Brotherhood]

Business profit, like most good things, is a double-edged sword. It is both absolutely necessary to society, highly...well...profitable for everyone and also can sometimes undo much of it's good effect when a few seize upon a profit oppportunity and walk away with millions of dollars while businesses, markets and livelihoods collapse in their wake.

Ideally, a market DOES work for the interests of the common people.

Ideally yes, but the idealists also know that there are times when some people will suffer negatively during times of upheaval and market shifts, even though the net effect is positive.

The (and this of course is very generalised and ignores degrees of inbetween) difference between those who believe in a free, but regulated market and those who believe in a strictly free market is that the first group believe we should reap the benefits of profit in a free market, but also that as a society we have a certain responsibility to minimize these negative effects to other members of society when they market makes them necessary. Those in the second group are the ones who believe we have no responsibility to others in our own society, and that creating personal profit is the only business dictate a person need have.

[Les Drapeaux Brulants]

I have no inherent problem with profit as a concept. I have a problem with profit over ethics, which in many cases in the private sector, is a legislated, legal mandate.

Really? I find that the burden of required ethics training is pretty heavy at public companies. That's really at odds with the concept that ignoring ethics to produce profit is mandated by anyone.

[Neesika]

I have no inherent problem with profit as a concept. I have a problem with profit over ethics, which in many cases in the private sector, is a legislated, legal mandate.

Really? I find that the burden of required ethics training is pretty heavy at public companies. That's really at odds with the concept that ignoring ethics to produce profit is mandated by anyone.

I said private sector.

The public sector is heavily regulated by constitutional civil rights guarantees, public interest concerns and so on. I have issues with bureaucracy and inefficiency at the public level that I do not believe are inherently linked to these guarantees but rather are a function of our concept of bureaucracy itself. Once again my main concern is with the private sector.

[Callisdrun]

Ooh, Sin is on.

Generally speaking, I'd agree. My problem with Capitalism is not that I think profit or business is inherently wrong. I love small local businesses, they're quite fun. My problem is that at certain levels, desire for profit leads to a degree of unethical behavior that I find... rather disturbing.

[Parnassus]

The capital use for labor trade involves consumption postponement and risk, which each carry economic value. Someone may simply prefer to sell labor rather than taking the time to build up capital first.

I'm not sure I agree that risk-taking, in and of itself, has economic value. It's an argument that reinforces the current capitalist system. We have people with capital/money who make money, not by contributing anything worthwhile, but by placing bets on which ideas/products produced by those without capital will succeed - all the while holding them hostage to the fact that they don't have capital to begin with. It just perpetuates the system. It doesn't do anything otherwise worthwhile.

I'll use the show Dragons Den as an example (even if you haven't seen it, the illustration will be clear enough). Poor people with (potentially) good ideas/products go before a panel of wealthy investors who basically place bets on how successful that idea or product might be. Then, the investors offer a small amount of money to buy ownership of the idea/product. The poor people can take this small percentage of the value of their idea/product, or leave with nothing. The investor has little real risk. They pick ideas/products that they think will succeed. The others, they summarily dismiss (after subjecting them to ridicule and insult). These investors haven't done anything - other than make bets on how successful the idea/product will be. But, the poorer person with the idea/product, trapped by the condition of their poverty, feels compelled (or is compelled) to give up their idea/product for a small percentage of its real worth.

This is exploitative (theft, in my book).

[Vittos Ordination]

Ooh, Sin is on.

Generally speaking, I'd agree. My problem with Capitalism is not that I think profit or business is inherently wrong. I love small local businesses, they're quite fun. My problem is that at certain levels, desire for profit leads to a degree of unethical behavior that I find... rather disturbing.

Note that those certain levels are at least in some part a result of the government's favoring of corporations as legal entities and financial centralization through major banks.