Capitalism or Socialism: Which is better?

[Sibirsky]

How would you set prices? If you let supply and demand set prices, there is nothing stopping employee owned companies from existing right now. At least one of my suppliers is a 100% employee owned company.

Well good, I hope they are successful and set fair prices to match the rules of supply and demand. Workers co-ops are very good ways of maintaining the good part of Capitalism (the market principle) and the good part of Socialism (a bit more fairness).

I can tell you their prices are fair (otherwise they wouldn't be one of my suppliers). But I cannot tell you anything about working there, benefits, pay, etc.

[Servantium]

You can have worker owned cooperatives in capitalism.

There should be more of them in my opinion.

That's the beauty of the system. If you want one, you can go start one. Pretty much no matter what "one" is.

[Crabulonia]

Well good, I hope they are successful and set fair prices to match the rules of supply and demand. Workers co-ops are very good ways of maintaining the good part of Capitalism (the market principle) and the good part of Socialism (a bit more fairness).

I can tell you their prices are fair (otherwise they wouldn't be one of my suppliers). But I cannot tell you anything about working there, benefits, pay, etc.

Still, working for a company where you are getting an actual share of the profits rather than a simple wage sounds much more satisfying and motivating.

There should be more of them in my opinion.

That's the beauty of the system. If you want one, you can go start one. Pretty much no matter what "one" is.

I've not got any ideas yet but it would be a model of enterprise I would be interested in starting if ever I wanted to get involved. Logistically it seems quite possible, get a group of people, each contributes some starting money and gets a share which reflects that, start business, split profits. If you want to increase the size of the business then you can offer shares to the employee, possibly as a sort of bonus for good work or to reward loyalty.

That sounds incredible!

[Conservative Alliances]

I once said that if there was an election between The Grand World Order and a hardline socialist, I would vote for The Grand World Order and got something like 3 TGs within a minute that can be summarized by "OMG YOU GOT TO BE JOKING!!!!"

I am serious, about the vote and the TGs.

I would probably vote that way, too. There was similar situation I was in one time where I suggested New Mittani should be a mod.

[Trotskylvania]

That example doesn't make much sense, even to myself - a supporter of an Anarcho-Socialist system that doesn't fit. Central planning doesn't decide that millions of pencils are needed then forgets that paper is needed as well, what sort of moron do you think would be in charge of central planning? It seems more likely that for a centralised Socialist state to work it would need to be technocratic and a meritocracy, only in this way could the best planning be ensured.

I don't quite get what you're suggesting, that Socialists can't count?

The problem isn't of counting it's of pricing, centralized command economies cannot allocate resources correctly because they lack the pricing method, so to take their example, we are dealing with one logging company and two lumber mills, one mill produces paper, the other produces furniture, the logging company can only produce so many logs per day, so a central bureaucrat must allocate those logs to either the paper mill or the furniture make, so how do they make their choice? In the market this decision is made by prices, you see if paper has a higher demand in the market then the paper mill will have more money to purchase those logs, thus they will buy the logs they need first since they can take them for the most money, the furniture company gets the rest, vice-versa if the demand is in favour of furniture. There is no way to simulate that without competition and pricing, a bureaucrat therefore must be arbitrary, assuming people use paper more then furniture he sends more to the paper mill, but little did he know that furniture would become demanded, their is now a shortage of furniture and an excess of paper, it isn't a matter of simple math, it's a matter of complex economic relationships which any number of bureaucrats simply cannot manage. This is a rather simplistic scenario, so imagine if you will that each of these mills also needs machinery and other tools that need to be produced by other factories which will need their own resources, competing in the market, they will typically all satisfy their needs for production or elsewise will be financially punished.

In a centrally planned economy, the mill A which produces paper may receive too much machinery and too few logs, while Mill B has the opposite. The economic system required to make an ordinary pencil is extraordinarily complicated with perhaps a hundred industries involved all working to match their supply with demand, a bureaucrat, ten bureaucrats, a thousand bureaucrats cannot make it work nearly as well as the market could. Soviet Russia, China, and North Korea are prime realizations of the politicized economy, it leads to suffering and destruction.

Just to play devil's advocate, there are multiple models of central planning that incorporate markets and pricing, and are no more or less likely to be pareto efficient than a laissez-faire market, at least according to neo-classical price theory.

[The REAL Glasers]

It boils down to the only entity that can prevent competition in an industry is government regulation of that industry. The big competitor continually buying out competition is not a sustainable business model and criminal activity would be punished by the government.

And I'm talking a 100% free market, which means no government intervention at all.

And I'm not talking about one monopoly controlling everything, I'm talking about multiple monopolies with control over multiple industries.

[Andertion]

Capitalism, it’s the only system that has worked with any real success.

Socialism might work in a perfect world but since that is not likely to happen I have to vote Capitalism.

[The Merchant Republics]

The problem isn't of counting it's of pricing, centralized command economies cannot allocate resources correctly because they lack the pricing method, so to take their example, we are dealing with one logging company and two lumber mills, one mill produces paper, the other produces furniture, the logging company can only produce so many logs per day, so a central bureaucrat must allocate those logs to either the paper mill or the furniture make, so how do they make their choice? In the market this decision is made by prices, you see if paper has a higher demand in the market then the paper mill will have more money to purchase those logs, thus they will buy the logs they need first since they can take them for the most money, the furniture company gets the rest, vice-versa if the demand is in favour of furniture. There is no way to simulate that without competition and pricing, a bureaucrat therefore must be arbitrary, assuming people use paper more then furniture he sends more to the paper mill, but little did he know that furniture would become demanded, their is now a shortage of furniture and an excess of paper, it isn't a matter of simple math, it's a matter of complex economic relationships which any number of bureaucrats simply cannot manage. This is a rather simplistic scenario, so imagine if you will that each of these mills also needs machinery and other tools that need to be produced by other factories which will need their own resources, competing in the market, they will typically all satisfy their needs for production or elsewise will be financially punished.

In a centrally planned economy, the mill A which produces paper may receive too much machinery and too few logs, while Mill B has the opposite. The economic system required to make an ordinary pencil is extraordinarily complicated with perhaps a hundred industries involved all working to match their supply with demand, a bureaucrat, ten bureaucrats, a thousand bureaucrats cannot make it work nearly as well as the market could. Soviet Russia, China, and North Korea are prime realizations of the politicized economy, it leads to suffering and destruction.

Just to play devil's advocate, there are multiple models of central planning that incorporate markets and pricing, and are no more or less likely to be pareto efficient than a laissez-faire market, at least according to neo-classical price theory.

Which would put it into the mixed economy point, or else it is the central state essentially faking the price system, but competition is required for prices to make sense and for resources to rightly distributed, the only way to incorporate the market system is to become less of a command economy. A real life example would be China's move to Capitalism, they could not as a centrally planned system rightly distribute, so they opened themselves up to a market system, bit by bit. It was successful as we all know, though they would have been much more so if they had opened up further.

I'm not hostile to free market socialism, but centrally planned socialism and centralized ownership communist systems are a very bad idea.

[The Merchant Republics]

It boils down to the only entity that can prevent competition in an industry is government regulation of that industry. The big competitor continually buying out competition is not a sustainable business model and criminal activity would be punished by the government.

And I'm talking a 100% free market, which means no government intervention at all.

And I'm not talking about one monopoly controlling everything, I'm talking about multiple monopolies with control over multiple industries.

Without violence there is no way of maintaining a monopoly over any particular industry, look at for instance another common "monopoly" thrown out as a condemnation of the free market, De Boor's diamond mining industry owned almost 85% of the world's diamond market for several decades, yet as one soon discovers, that was because the held the only large legal (read: non-conflict/blood) diamond mine in the world, still despite having a virtual monopoly on the source of diamonds, they had competition from other Indian and Brazilian diamond mining corporations which they could never fully remove despite their much smaller supply. Here if anywhere a real 100% market monopoly should have formed but none such did.

Anyways, no a 100% free market would not have "no government intervention" it/or another applicable justice service would intervene only in the case of coercion or violence. Even if however violence were a legitimate means of holding market power, monopolies would still not ever be able to have complete market dominance, not only because with dominance (and thus lack of competition) it would soon be unable to properly distribute goods (the same problem of a centrally planned state) but also because if they are charging more then consumers will pay, competition will spring up even if it is underground, much like drug trafficking and soviet black markets, despite their competition being illegal they existed and in some case were incredibly powerful.
We have all this while talking about single industry monopolies, never had we discussed a complete monopoly of all production is of course impossible.

[The Deep Vault]

Free-Market Monopolies aren't inherantly nasty. Most of the nasty monopolies are government-secured. A general rule is, if a monopolic corporation starts shitting over the consumers, it creates a market niche for competition to begin again. The only reason, say, Starbucks and Walmart can keep up what they're doing is through competition. People don't like what they're doing and there are fierce campaigns to support alternatives already (they're not even monopolies yet lol). Imagine if they became a giant monopoly and stopped offering competitive prices, smaller coffee houses and shops would be able to tear them apart like vultures to a beached whale, forcing them to compete once more.

Tl;dr, becoming a monopoly doesn't exempt you from market forces. To do that requires governmental securities (like Standard Oil did in the late 1800s).

Monopolies can give out temporary benefits and then revoke them as soon as the competition's gone as well. It happened all the time in the 19th Century.

[Servantium]

It boils down to the only entity that can prevent competition in an industry is government regulation of that industry. The big competitor continually buying out competition is not a sustainable business model and criminal activity would be punished by the government.

And I'm talking a 100% free market, which means no government intervention at all.

So am I. Free market capitalism is not compromised by the government punishing an individual or group for hiring thugs to rough up the competition.

[Servantium]

Monopolies can give out temporary benefits and then revoke them as soon as the competition's gone as well. It happened all the time in the 19th Century.

Then when they stop doing that the niche opens right back up again.

[The Merchant Republics]

That's the beauty of the system. If you want one, you can go start one. Pretty much no matter what "one" is.

I've not got any ideas yet but it would be a model of enterprise I would be interested in starting if ever I wanted to get involved. Logistically it seems quite possible, get a group of people, each contributes some starting money and gets a share which reflects that, start business, split profits. If you want to increase the size of the business then you can offer shares to the employee, possibly as a sort of bonus for good work or to reward loyalty.

That sounds incredible!

The most significant barrier to the introduction of worker-owned cooperatives into the market is they are inherently difficult to start up, you need to find enough people who not only willing to risk their money to your business idea but also their time and labour, it is much harder to convince people to give you all that on a possible chance of profit (1/3 of all businesses collapse within three years), then just convince them to spare their money (as investors in a corporation) or their labour and time (as employees to a single proprietorship).

Like I've said there are certain real advantages to a worker-owned cooperative, but the demands on start-up and running make them very hard to do, and making them the only legal method of starting a business will ultimately lead to a much slower rate of innovation and economic growth.

[Sibirsky]

Like I've said there are certain real advantages to a worker-owned cooperative, but the demands on start-up and running make them very hard to do, and making them the only legal method of starting a business will ultimately lead to a much slower rate of innovation and economic growth.

What are the advantages of co-ops?

[The Merchant Republics]

Like I've said there are certain real advantages to a worker-owned cooperative, but the demands on start-up and running make them very hard to do, and making them the only legal method of starting a business will ultimately lead to a much slower rate of innovation and economic growth.

What are the advantages of co-ops?

Mostly the emotional ones, shared profits, shared decision making, better work conditions (sometimes), hugs (I imagine), I don't know.

Personally I think that co-ops could be capable of delivering increased productivity, if everyone has an incentive to work hard to increase their individual profits, that is supposing that the business distributes the profits based on productivity and not "need", otherwise I have doubts of it's actual chances of success. I think so long as workers feel like they own their labour and their production they will work harder, it's basically like having your employees work on commission, which I can attest as a pay-on commission worker, makes for a much more enthused workforce. Other problems which might disappear would be employee vs. employer relationships, given that the employee has a real incentive to make the business work too.

I'm not a socialist for a variety of reasons, but if I ever started a manufacturing company I would probably pay for productivity as opposed to traditional wages. Most of it ties to good old capitalist sense, ownership = better care and productivity, so why not apply it to labour?

[Sociobiology]

I'm not clear on how socialism's being defined here, so for now I"ll say mixed with incredible amounts of socialism--perhaps even nearly socialist.

Communism
An economic and political system characterized by the collective ownership of property and by the centralized organization of labor and goods for the common advantage of all members based on need

Socialism
An economic system characterized by the collective ownership of property with a centralized distribution of goods based on individual labor into the system

Capitalism
An economic system in which the means of production and distribution are privately owned and development is proportionate to the accumulation and reinvestment of profits gained in a free market.

mixed economies are generally a capitalist system with some regulation of business(you cant put rat poison in your hot dogs) and some basic nessesities (such as the military) provided by the government to the exclusion of private competitors.

[Mediterreania]

What are the advantages of co-ops?

Mostly the emotional ones, shared profits, shared decision making, better work conditions (sometimes), hugs (I imagine), I don't know.

Personally I think that co-ops could be capable of delivering increased productivity, if everyone has an incentive to work hard to increase their individual profits, that is supposing that the business distributes the profits based on productivity and not "need", otherwise I have doubts of it's actual chances of success. I think so long as workers feel like they own their labour and their production they will work harder, it's basically like having your employees work on commission, which I can attest as a pay-on commission worker, makes for a much more enthused workforce. Other problems which might disappear would be employee vs. employer relationships, given that the employee has a real incentive to make the business work too.

I'm not a socialist for a variety of reasons, but if I ever started a manufacturing company I would probably pay for productivity as opposed to traditional wages. Most of it ties to good old capitalist sense, ownership = better care and productivity, so why not apply it to labour?

Co-ops are actually anti-capitalist. They're free market, but capitalism is the type of free market characterized by top-down ownership.
LONG LIVE FREE MARKETS, DEATH TO CAPITALISM!

[Sibirsky]

What are the advantages of co-ops?

Mostly the emotional ones, shared profits, shared decision making, better work conditions (sometimes), hugs (I imagine), I don't know.

Personally I think that co-ops could be capable of delivering increased productivity, if everyone has an incentive to work hard to increase their individual profits, that is supposing that the business distributes the profits based on productivity and not "need", otherwise I have doubts of it's actual chances of success. I think so long as workers feel like they own their labour and their production they will work harder, it's basically like having your employees work on commission, which I can attest as a pay-on commission worker, makes for a much more enthused workforce. Other problems which might disappear would be employee vs. employer relationships, given that the employee has a real incentive to make the business work too.

I'm not a socialist for a variety of reasons, but if I ever started a manufacturing company I would probably pay for productivity as opposed to traditional wages. Most of it ties to good old capitalist sense, ownership = better care and productivity, so why not apply it to labour?

Hugs?

I'm going to try looking through my paperwork to find that one supplier that is "A 100% employee owned company" as all their documents say, and see who my contact is to ask about this. No guarantees, I haven't seen anything from them in a while.

[Sibirsky]

Mostly the emotional ones, shared profits, shared decision making, better work conditions (sometimes), hugs (I imagine), I don't know.

Personally I think that co-ops could be capable of delivering increased productivity, if everyone has an incentive to work hard to increase their individual profits, that is supposing that the business distributes the profits based on productivity and not "need", otherwise I have doubts of it's actual chances of success. I think so long as workers feel like they own their labour and their production they will work harder, it's basically like having your employees work on commission, which I can attest as a pay-on commission worker, makes for a much more enthused workforce. Other problems which might disappear would be employee vs. employer relationships, given that the employee has a real incentive to make the business work too.

I'm not a socialist for a variety of reasons, but if I ever started a manufacturing company I would probably pay for productivity as opposed to traditional wages. Most of it ties to good old capitalist sense, ownership = better care and productivity, so why not apply it to labour?

Co-ops are actually anti-capitalist. They're free market, but capitalism is the type of free market characterized by top-down ownership.
LONG LIVE FREE MARKETS, DEATH TO CAPITALISM!

But they can exist in a capitalist system.

[Mediterreania]

Co-ops are actually anti-capitalist. They're free market, but capitalism is the type of free market characterized by top-down ownership.
LONG LIVE FREE MARKETS, DEATH TO CAPITALISM!

But they can exist in a capitalist system.

They can. However, they would quickly beat corporations and become a mutualist system if it wasn't for the state.

[Servantium]

But they can exist in a capitalist system.

They can. However, they would quickly beat corporations and become a mutualist system if it wasn't for the state.

When he sayd capitalism he means free market capitalism. To many (possibly to a majority) of advocates, "capitalism" and "free market capitalism" mean the same thing.

[Hagstromia]

co-ops can be great, but they are subject to the rest of the free market, thus are inneficient in the long run.

[Mediterreania]

They can. However, they would quickly beat corporations and become a mutualist system if it wasn't for the state.

When he sayd capitalism he means free market capitalism. To many (possibly to a majority) of advocates, "capitalism" and "free market capitalism" mean the same thing.

And to advocates of anarchist mutualism, "free market capitalism" is an oxymoron. Corporations themselves are state creations, and would not exist in a truly "free" market.

[The Merchant Republics]

But they can exist in a capitalist system.

They can. However, they would quickly beat corporations and become a mutualist system if it wasn't for the state.

I don't think that is true persay, in the absence of the state we might see a greater amount of co-operatives but I don't think they would necessarily come to dominate, especially against say single proprietorships which are too easy to set up for them to be out-competed, still as I mentioned in my spiel, the biggest problem is starting a co-operative, you need enough like-minded people with enough disposable wealth, the right skills to work there and the ability to work without a profit for a long period. Comparatively corporations and single proprietorships are just easier, so even with increased risks from lack of state help most businesses will start privately owned, simply because it's easiest that way.

[The Merchant Republics]

When he sayd capitalism he means free market capitalism. To many (possibly to a majority) of advocates, "capitalism" and "free market capitalism" mean the same thing.

And to advocates of anarchist mutualism, "free market capitalism" is an oxymoron. Corporations themselves are state creations, and would not exist in a truly "free" market.

In what sense?

A corporation is a legally recognized firm, true, but in the absence of legal recognition; groups of people investing their money in entrepreneurs in exchange for a share of future profits does not appear to be something which could not exist outside the state. A cooperative after all is essentially just a corporation where the shareholders are all workers in the business.