The Problem with Libertarianism

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Re: The Problem with Libertarianism

Post by V for Valjean on Thu Dec 06, 2012 11:10 pm

Leon Mcnichol wrote:In Sweden... they have free health, free education

As for the cancer patient, in Sweden he is not paying for his retirement, he is paying for his free medical assistance, free psycological aid for him and his family, etc etc.

That's the lure of government programs isn't it? "Here, we will give you something for free." Now whoever told you that did you a very great misservice at the most fundamental level.

You don't have a free good. It isn't coming from nowhere. People are being forced against their will to pay for it all their lives, and the real question is are they benefiting from it in a cost effective way? Of course they aren't. In America you don't "pay" to go to public school. But guess what, America collects $16,000 in taxes per child in K-12. Each year. Using this as a simple example no one believes for a second in a normal classroom of 20 third graders that it costs a third of a million dollars a year to provide their education. The amount of benefit that reaches each of those 20 students is only a small fraction of the $320,000 collected. The rest is wasted by government inefficiencies which you don't have in private enterprise.

Regardless of the specific example, next time you see whoever it was that told you there's a free good out there that materializes out of nowhere ... slap the taste out of their mouth for misleading you.

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Re: The Problem with Libertarianism

Post by Rev Scare on Fri Dec 07, 2012 6:39 am

To begin, you should be restricted to the OV section, as your reactionary libertarian views are contaminating the main forum.

V for Valjean wrote:Its really very simple. If private enterprise can perform a service at a more efficient price than government then government ought not to perform that service. There are really only a very few things which must be provided by government when you boil it down.

Define efficiency. There is no universally upheld notion of what is and is not economically "efficient." Bourgeois economists, particularly those of the Austrian persuasion, assume that the equilibrium prices arising out of conditions of perfect competition connote efficiency, but this is a spurious proposition. This thread is not intended for refuting the numerous errors in the belief that private market competition generates "efficiency," but I will proceed to at least superficially challenge this empty nonsense. Moreover, government enterprises typically stray from "equilibrium" (market) prices not due to some inability to calculate costs, but in order to avoid the heinous consequences of allowing vital services to be subject to the anarchic forces of the market.

I also request that you elaborate your conception of capitalism and "private enterprise." Many of us espouse market syndicalism (though as a transitional stage toward a more rational and just planned economy), which more or less entails collectively managed private enterprises ("private" in the sense that they are not state enterprises, are more or less governed exclusively by their worker members, and subject to market competiton as opposed to the alleged "bureaucratic corruption you rail against) competing in a market context. This is a qualitatively different arrangement than the wage-for-labor-time contract entailed by the capitalist mode of production.

Simply put, I would contend that Pareto optimality is far too narrow a criterion for determining efficiency. It is ludicrous. The same applies to cost benefit analyses, which are bourgeois constructs of unsound theoretical and practical value.

Government must provide a criminal law system as well as a tort law system where people or businesses who take advantage of other citizens can be punished by paying great sums of money. They must provide for the common defense in the form of a military. Government must have an infastructure to collect taxes, etc. There are a few other things, but not many that can only be done properly by government. Now that doesn't mean there aren't other things where its not inappropriate for government to be involved, but that's a different matter than essential.

Who is to decide what is and is not "appropriate" for the government to provide? As far as I am concerned, the government may play as large a role as deemed necessary by the democratic state. Certainly, critical industries should be nationalized rather than manipulated for private gain. I could bother to provide an extensive critique of your basic position, but I truly should not have to. Your liberal myth of an industrious private sector is honestly quite ridiculous. There is no reason to believe that state sponsored economic development (which is, incidentally, not what most of the members here advocate) is less effective than private enterprise. Indeed, history banishes this bourgeois economic dogma, as virtually every single nation in history has relied upon vast government support in order to elevate national economies.

Soviet state socialism was superior to capitalism. The USSR's economy was superior to that of the United States in many respects, not least of all its ability to impel economic growth. I urge you to contest this point in typical reactionary fashion, as I very much look forward to proving the superiority of state socialism over the various capitalisms existing in the West.

But you asked how we know if its efficient to have government perform a certain task. If I can go to Home Depot and buy a toilet seat for $10 but the US government buys them for $500 (and this is a real example) then that's not an appropriate role for government is it? Its not appropriate because government isn't purchasing efficiently. Its charging the citizens collectively $500 in return for a $10 item. The result is basically a $490 tax called "government waste".

A real example? Do you have a source for this? Why are we to accept your bare assertion regarding government efficiency? Private market competition is replete with externalities, imperfect information, perverse incentives, free rider problems and daunting transaction costs for socially enjoyed goods and services, and allocative failures, all of which lead to gross miscalculations of costs, and therefore mispricing. You see, the market operates according to what Marx called "the law of value," which is a narrow and quite awful manner of structuring an economy, as it imposes harsh objective conditions upon its unwitting subjects. It is anti-social, irrational, engenders imperialism, environmental degredation, and anti-democratic wealth inequality. It rewards on the basis of property, genetic and educational endowments, initial advantages, and luck. All of this is true even under conditions of "perfect" competition.

As mentioned above, you do not seem to understand that state enterprises may and often do deliberately deviate from market prices in order to fulfill more worthwhile goals, such as ensuring a stable supply of goods, maintaining employment during difficult economic times, allowing for the growth of fledgling but important industries, etc. This alone is reason to believe that the state is more suited for managing an economy than private capitalists. In fact, it is absurd to me to even countenance the thought of private profit-seekers blindly competing for short-term gain in the best interests of society. In reality, the beneficent invisible hand more closely resembles a malevolent invisible foot.

All of this is irrelevant to the ultimate socialist critique of capitalism: exploitation. Your idea of exploitation, which you have mentioned elsewhere, is incorrect. Exploitation is not the consequence of involuntary contracts: it is a product of the capitalist's (the private owner(s)'s) appropriation and distribution of the labor of others through the social relation of wage labor. A private capitalist hires workers to work with the means of production he owns. They produce a surplus (profit) for said capitalist and are therefore paid a wage below the value of what they produced. This must be the case, whether you accept the validity of the labor theory of value or not, because a positive profit necessitates a differential between wages paid and commodities sold. In other words, the private capitalist is a parasitic middle man who gains something in return for nothing. This unjust social relation is the basis of the capitalist mode of production, and it alone is worthy of its condemnation.


Last edited by Rev Scare on Fri Feb 08, 2013 10:45 pm; edited 3 times in total

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Re: The Problem with Libertarianism

Post by Rev Scare on Fri Dec 07, 2012 7:09 am

V for Valjean wrote:That's the lure of government programs isn't it? "Here, we will give you something for free." Now whoever told you that did you a very great misservice at the most fundamental level.

You don't have a free good. It isn't coming from nowhere. People are being forced against their will to pay for it all their lives, and the real question is are they benefiting from it in a cost effective way? Of course they aren't. In America you don't "pay" to go to public school. But guess what, America collects $16,000 in taxes per child in K-12. Each year. Using this as a simple example no one believes for a second in a normal classroom of 20 third graders that it costs a third of a million dollars a year to provide their education. The amount of benefit that reaches each of those 20 students is only a small fraction of the $320,000 collected. The rest is wasted by government inefficiencies which you don't have in private enterprise.

Regardless of the specific example, next time you see whoever it was that told you there's a free good out there that materializes out of nowhere ... slap the taste out of their mouth for misleading you.

Educated people do not believe that public services carry no social cost. Do not be absurd. Of course universal healthcare, public education, public housing, welfare, etc. (basic provisions any civilized society would never question) entail costs. The question ethical individuals ask is whether these costs are justified. My answer is absolutely, for various reasons.

For one, your standard reactionary challenge is bunk. Taxation is not immoral. Nozick was wrong, and it is perfectly legitimate for the state to tax the social product generated through the collective effort of millions of individuals. Two, the wealth of the capitalist class is illegitimate, and so its ideologues are in no position to oppose its redistribution, including by way of the propaganda above. There is an abundance of taxable wealth, but it simply happens to be distributed inequitably and unequally. Three, I see no moral nor economic reason why the state should not interfere in areas where markets regularly fail to maximize the well-being of all individuals, where a social imperative exists, and where it is sensible to do so. Most importantly, such services palpably alleviate the needless suffering of millions, and this social benefit counteracts the economic costs to society.

I will ignore your false statements regarding the efficiency of private education for now.

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Re: The Problem with Libertarianism

Post by DSN on Fri Dec 07, 2012 3:54 pm

V for Valjean wrote:... or Communist China where government employees make up 50% of the workforce.

lol!

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Re: The Problem with Libertarianism

Post by V for Valjean on Fri Dec 07, 2012 4:25 pm

DSN wrote:
V for Valjean wrote:... or Communist China where government employees make up 50% of the workforce.

lol!

Dear DSN,
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Re: The Problem with Libertarianism

Post by Admin on Fri Dec 07, 2012 7:45 pm

Rev Scare wrote:To begin, you should be restricted to the OV section, as your reactionary libertarian views are contaminating the main forum.

Indeed. V for Valjean, you are henceforth under restriction. You are encouraged (though not presently required) to direct your future posts to the OV (reactionary) section. We encourage you to continue engaging in civil debate.

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Re: The Problem with Libertarianism

Post by V for Valjean on Fri Dec 07, 2012 8:08 pm

If you hope for your imaginary revolution to succeed where every other socialist country has failed, or presently is failing, you'd do well to educate yourself with the very ideas I'm presently equipping you with. If your own insecurities make you unable to have a very basic discussion without resorting to the cowardice of censorship then you're prospects are no better than your failed predecessors.

So be that the case, then I'll instead encourage you each instead to visit my economics forum, econ-forum.net where you can enter the Arena of Ideas free of restriction. You may even learn something.

"The only thing which shall make me a different man a year from now than the man I am today is the people I've met and the books I've read."
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Re: The Problem with Libertarianism

Post by Admin on Fri Dec 07, 2012 8:21 pm

No one is attempting to censor your posts. We are merely recommending that you direct your content to the opposing views section of the forum. This is a reasonable request given the nature of your disposition.

With respect to your offer, I doubt anyone here has an interest in wasting any time on a vacant forum managed by a sophomoric propertarian.

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Re: The Problem with Libertarianism

Post by V for Valjean on Fri Dec 07, 2012 8:32 pm

Admin wrote:No one is attempting to censor your posts. We are merely recommending that you direct your content to the opposing views section of the forum. This is a reasonable request given the nature of your disposition.

With respect to your offer, I doubt anyone here has an interest in wasting any time on a vacant forum managed by a sophomoric propertarian.

It is vacant absolutely, I just migrated it onto a paid server today and am still setting the SEO up. And given that this forum has fewer than 10 active members a day I don't know that you do yourself a service through your attempts at censorship.

As for the last, insulting piece of your remark, it would take a very insecure person indeed to call someone with an MBA from Chicago who took economics from a man with a Nobel Prize sophomoric. You make some gross assumptions about the level of education & sophistication of people just because they reach a different logical conclusion than you on issues. Prejudice is such an ugly, petty trait isn't it Administrator?

prej·u·dice
noun
1.
an unfavorable opinion or feeling formed beforehand or without knowledge, thought, or reason.

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Re: The Problem with Libertarianism

Post by Leon Mcnichol on Fri Dec 07, 2012 8:58 pm

V for Valjean wrote:It is vacant absolutely, I just migrated it onto a paid server today and am still setting the SEO up. And given that this forum has fewer than 10 active members a day I don't know that you do yourself a service through your attempts at censorship.

As for the last, insulting piece of your remark, it would take a very insecure person indeed to call someone with an MBA from Chicago who took economics from a man with a Nobel Prize sophomoric. You make some gross assumptions about the level of education & sophistication of people just because they reach a different logical conclusion than you on issues. Prejudice is such an ugly, petty trait isn't it Administrator?

prej·u·dice
noun
1.
an unfavorable opinion or feeling formed beforehand or without knowledge, thought, or reason.

Cool story bro. If you belittle our forum, you can always leave, and as for logic, i am sorry to rain on your parade, but we had far more sophisticated and intelligent trolls around here.

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Re: The Problem with Libertarianism

Post by V for Valjean on Fri Dec 07, 2012 9:04 pm

Leon Mcnichol wrote:we had far more sophisticated and intelligent trolls around here.

I assume you refer to some of the forum staff like yourself. Because if you reread the fairly small number of posts I've made you'll see that every statement I make I support with fact. Now go reread your own posts moderator and ask yourself who's trolling whom.

And trust me, I know internet trolls well as I also Admin a gaming forum with over 25,000 members and 1,004 posts / day. Its called reddead.net and if you're a gamer you're also invited there as well. I promise, we don't censor people for their ideas there either comrade.

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Re: The Problem with Libertarianism

Post by Admin on Sat Dec 08, 2012 12:25 am

V for Valjean wrote:It is vacant absolutely, I just migrated it onto a paid server today and am still setting the SEO up.

I don't see any cause for optimism on your part.

And given that this forum has fewer than 10 active members a day I don't know that you do yourself a service through your attempts at censorship.

The Socialist Phalanx attracts a relatively significant level of traffic and prides itself on the quality of its content. We have also been fortunate enough to enjoy a consistent level of growth since its inception. Your forum would be lucky to accomplish a fraction of what we have.

I will again repeat that we have not censored any of your posts. Your restriction simply serves as a means of differentiating you, as an OV member, from the forum's general membership.

As for the last, insulting piece of your remark, it would take a very insecure person indeed to call someone with an MBA from Chicago who took economics from a man with a Nobel Prize sophomoric. You make some gross assumptions about the level of education & sophistication of people just because they reach a different logical conclusion than you on issues. Prejudice is such an ugly, petty trait isn't it Administrator?

Resorting to unsubstantiated claims about your educational background is not going to impress anyone here. In any case, the very notion that someone like you was educated at an accredited institution of higher education serves as an indictment against the quality of the institution in question, your professors, and the Nobel Committee for Economic Science.

If you're truly eager to demonstrate your knowledge of political-economy, I recommend you abstain from hiding behind your alleged credentials and continue to engage in civil debate with our membership. Specifically, I would suggest that you respond to Rev Scare's comprehensive refutation of your recent claims, lest you wish to convey your ignorance and ineptitude to everyone here.

prej·u·dice
noun
1.
an unfavorable opinion or feeling formed beforehand or without knowledge, thought, or reason.

Don't patronize me with that sort of petty bullshit.


Last edited by Admin on Sun Dec 09, 2012 8:04 pm; edited 2 times in total

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Re: The Problem with Libertarianism

Post by V for Valjean on Sat Dec 08, 2012 12:50 am

Admin wrote: Specifically, I would suggest that you respond to Rev Scare's comprehensive refutation of your recent claims, lest you wish to convey your ignorance and ineptitude to everyone here.

* Sigh *

Which is it Administrator? You either want me to participate in this portion of the forum or you don't. I can even hide behind erudite language instead of presenting my ideas so clearly if throwing the word rubric around a few times would help ease the tension.

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Re: The Problem with Libertarianism

Post by Admin on Sat Dec 08, 2012 1:39 pm

V for Valjean wrote:Which is it Administrator? You either want me to participate in this portion of the forum or you don't. I can even hide behind erudite language instead of presenting my ideas so clearly if throwing the word rubric around a few times would help ease the tension.

I just made the decision easier for you. Proceed. We're all eager to see how you respond to the points made by our esteemed moderator, Rev Scare.

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Re: The Problem with Libertarianism

Post by DSN on Sun Dec 09, 2012 6:49 pm

V for Valjean wrote:
Dear DSN,
The Facts: Not always as funny as you thought they would be Owned



I was laughing at the 'Communist China' part of your response, not the percentage. I suppose that is a mistake on my behalf considering the faintness of the bold font in quotes.

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Re: The Problem with Libertarianism

Post by Crimson Phoenix on Tue Dec 11, 2012 1:25 am

Well damn, I've been gone too long. My thread's been jacked by a libertarian of all things. Laughing

I'll start posting here again later today, I need to catch up and repsond to some of this.

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Re: The Problem with Libertarianism

Post by V for Valjean on Tue Dec 11, 2012 1:26 pm

V for Valjean wrote:I've always enjoyed discussing politics and economics with folks of a more collectivist or socialist leaning because, to pay you a very sincere compliment and i hope you'll take it as such, I've always observed that socialists are much more interested in economics than folks from other viewpoints. And i can tell from reading posts here a great many people who've spent considerable time thinking about topics like this. Its disappointing to say, but the truth, that most people from all the other schools of thought have given far less consideration to these topics.


Rev Scare wrote:you should be restricted

I'm glad to see Administrator was able to hide his inability to intellectually defend the core portion of his beliefs by burying this thread to a non-mainstream portion of the forum.




People are better off making their own choices and not relying on government. Have you been to Hungary before? Ever visit Eastern Europe, or the Soviet Union or Czech Republic? I have. I was there after the collapse of the socialist governments that started out with the very best intentions. Just like you, they were intending only to improve the lots of their citizens, but – as would you - they all ended up making the people poorer, miserable and into slaves.

In the center of Prague is the Grand Hotel Europa. It’s a relic of from the days when Czechoslovakia was one of the wealthiest countries in the world… when I see it I see a reminder of a more productive past before communist central control. The same culture, the same people, the same resources… yet under socialism this country suffered a drastically lower standard of living. That is the result of substituting orders from the top for market incentives from below.

Your whole line of logic fails because it does not consider that while political change or political freedom can be achieved very quickly economic freedom and prosperity is a different matter and takes time. See you are concerning yourself, in my opinion very short sightedly, with the equality of finished results. I am concerned with the equality of opportunity. The system I advocate for below provides equal opportunity to everyone and that is freedom. To have a government give you your small portion, the same portion as your neighbor is given… equality of results… that is not freedom its slavery. Under no circumstance is it correct for government to intervene in a free market system to do something about inequality of results. Not distress, inequality, which is the issue you’ve raised.

Rev Scare wrote:Define efficiency. There is no universally upheld notion of what is and is not economically "efficient." Bourgeois economists… assume that the equilibrium prices arising out of conditions of perfect competition connote efficiency… the belief that private market competition generates "efficiency," … [is] empty nonsense.


There most certainly is a universally accepted definition of economic efficiency. Just because the definition is unfavorable to your viewpoint doesn’t mean it doesn’t exist. Efficiency means the use of resources to produce the most goods & services. An economy is more efficient if it can produce more goods & services for its society using fewer resources. That, of course, is also why the capitalist US won the Cold War and the communist Soviet Union collapsed upon itself… were I to boil down a complicated event to its most fundamental nature: that the Soviet economy was inefficient and unable to keep pace with the US economy. And I use that example because you brought it up although I’ll address it in more detail below.

Rev Scare wrote:Moreover, government enterprises typically stray from "equilibrium" (market) prices not due to some inability to calculate costs, but in order to avoid the heinous consequences of allowing vital services to be subject to the anarchic forces of the market.

If you’d stopped at ‘government enterprises typically stray from "equilibrium"’ you’d have the right answer. The fact is that every monopoly in human history has been caused by government interference in the free market. So if you want to talk about government interfering with market prices it only produces bad outcomes: government wastes taxpayer money by purchasing at a higher price than the taxpayer could have & government causes monopolies and other market externalities. And lest you want to respond and discuss monopolies I’ll just do it now and point out that there are only 2 recoded monopolies in human history which have not been caused by some form of government interference in the market, but I don’t believe you have an appropriate knowledge-base to find them so I’ll give them to you: the New York Stock Exchange until the mid 1900s and the DeBeers Diamond Company. If it is monopolies or other market externalities you hate then you prove my point not your own as the only way to avoid those things is to avoid government interference in the free market.

Now to the second part of your statement: “but in order to avoid the heinous consequences of allowing vital services to be subject to the anarchic forces of the market.” Plainly you do not believe that government pays way too much for the things it buys because it wants to make a philosophical point and thumb its nose at the “anarchic forces of the market”. Let’s not be ludicrous here. Government pays too much for the things it purchase because governments are wasteful & inefficient. The market is efficient because it is made up of people spending their own money on themselves. People are very good at determining where they get the best deal. They don’t do a good job when they’re spending someone else’s money. They do the worst job of all when they’re spending someone else’s money on a third party (which is the case of government purchases). I’ll introduce you to the psychology of how people spend money and how it applies to government waste with this very simple graphic:









Rev Scare wrote:I also request that you elaborate your conception of capitalism and "private enterprise." Many of us espouse market syndicalism (though as a transitional stage toward a more rational and just planned economy), which more or less entails collectively managed private enterprises competing in a market context. This is a qualitatively different arrangement than the wage-for-labor-time contract entailed by the capitalist mode of production.

Simply put, I would contend that Pareto optimality is far too narrow a criterion for determining efficiency. It is ludicrous. The same applies to cost benefit analyses, which are bourgeois constructs of unsound theoretical and practical value.


There is a fundamental error in Pareto optimality although it has nothing to do with what you’re saying. You may know some of these words but you’ve clearly not yet been exposed to the deeper ideas of them. The problem with the Pareto theory is that it is fundamentally flawed because it assumes that in order for one party to become better off another must become worse off. In capitalism both parties benefit. By definition no transaction can take place unless both parties believe they’re better off for it.

That brings us to employment, which you take obvious affront to. There is no person employed in any capitalist country in any arrangement for which they’re not better off than their alternative. I don’t care if you want to take a sweatshop worker stitching Nike’s in Asia somewhere. They are better off than their alternative for that job, which is why they’ve CHOSEN FREELY to do it. It is a pure fallacy of reason to assume that you, or a government, or any collection of people could decide better what someone ought to be doing than they themselves can decide. No one knows more about that individual’s situation than he does.

Now to your last point about collectively managed enterprises: there have been many in human history, they’ve all failed. If it was such a great idea to put a bunch of people in a warehouse with no one in charge and let them all own a tiny fraction of what they produce… well if that idea led to greater production of goods & services then it would have spread widely long ago. But it doesn’t… history is not on your side my friend. The facts are not on your side. And using a bunch of words you only partially understand won’t change that.








Rev Scare wrote:Who is to decide what is and is not "appropriate" for the government to provide? Certainly, critical industries should be nationalized rather than manipulated for private gain.

I notice the pattern that you fail to suggest what you believe would be optimal, and instead just insult other systems you feel are stupid. So, as this is getting long, do recognize that the true strength in conversation doesn’t lie in putting things down it lies in persuasively presenting your own ideas, which you’ve not even started to do.

On that point: who is to say what government should provide? Every nation on earth has its own founding document defining the role of government. Likely you’ve heard about these before? Were I to take America as an example the enumerated powers in the Constitution define what the federal government is allowed to do, whether they’ve been deviated from is a separate matter. More philosophically, and less specific to any given nation, government ought to do provide those goods and services it can purchase for its citizens at a cheaper price than they can purchase them for themselves. See, what you have forgotten in all your writing, is that government has no money of its own. It only has the tax revenue it collects from its citizens. Inflation is just a tax without legislation, so a government that just prints more money so it has some (whereby causing inflation) has really just levied a tax. SO because government has no money but the money its citizens have given it, it is only logical that government should purchase those things it can get a better price for its citizens collectively than they can get for themselves individually. A few exceptions government must provide go to areas like national defense, a court system, etc because they are things citizens cannot individually purchase. Government must also be involved in areas where the transaction of 2 parties effects a 3rd party like in the case of pollution. The problem you have with big government (which you advocate) is that it wastes its citizens money in ways they would never approve of in order to cater to special interests. That’s why, as an example, in the US you see billions of dollars a year spent to educate people on the health hazard of smoking, and billions of dollars in subsidies going to the tobacco industry. Governments are corrupt in how they spend citizen’s money by special interests, people (should the individual taxpayer have kept that tax dollar instead of handing it over) cannot be corrupted by special interests. People spend on things for which they know they will directly benefit.



Rev Scare wrote:an industrious private sector is honestly quite ridiculous. There is no reason to believe that state sponsored economic development is less effective than private enterprise. Indeed, history banishes this bourgeois economic dogma, as virtually every single nation in history has relied upon vast government support in order to elevate national economies.


Prove it. Its far from a myth, it’s a proven fact that a free private sector is more productive. If you want to make very pedantic, dogmatic, unfounded statements like that then to this one I shall put the burden of proof on you. And since your entire dogma rests upon this statement being correct I assume you have a very sophisticated and well bolstered explanation for that statement. Lay it on me Rev.

And I’ll lay on you the example of Hong Kong. It has limited space, no natural resources of any kind and until recent history had almost no capital. Through laissez-faire economic policy its become the economic center of all of Asia and has an average standard of living comparable to the United States. That’s the power of capitalism. Please, go find a socialist example… lay the Nordic countries on me where the median household income for a family of 4 is below the US poverty level in 2 out of the 3 of those countries. Go on now, you want to be pedantic and dogmatic then let’s see the substantiation for your dogma.



Rev Scare wrote:Soviet state socialism was superior to capitalism…. I very much look forward to proving the superiority of state socialism over the various capitalisms existing in the West.

If what you said is true how do you rationalize the long term decline of the Soviet state socialist model and the relative stability & growth of the capitalist western model?


As you can see, the Soviet state collapsed and the capitalist states around it did not. But if you feel the Soviet & Soviet era socialist states were superior let’s take a poll. See you have no idea what you’re actually talking about because you didn’t live there. Neither did I. So let’s take a look at the behavior of the people who did live there. Let’s look at how people voted with their feet. It was Soviet East Germany who had to put up walls to keep its people from leaving not West Germany. Its communist China who has to put border guards out to keep people from fleeing to capitalist Hong Kong not the other way around.

But since the fact Soviet citizens would gnaw their own arm off to escape is likely to not be proof enough for you, let’s have some analysis of the Soviet economy compared to the US economy shall we?

1. It is true that in the ‘50s the Soviet economy was growing at around 5% a year, which was faster than the United States. But productivity was low and stagnant. For that extra output, the Soviet Union was burning capital. But more to the point, what you’re likely hiding behind is the fact that the Soviet economy grew at an annualized average of 14.6% from 1928-1940. This corresponded with the introduction of industrial manufacturing in the USSR and America experienced nearly identical growth rates during its Industrial Revolution period. Soviet growth in the following decades fell to an average of 7% in the ‘60s then 5.3% in the 70’s then 3.2% in the 80’s (and that’s using very liberal numbers it was likely much lower). Gradual decline, eventual collapse, failure of (and the abandonment of) the government run command economy. End of story.


2. The Soviet collective farms were an abysmal failure due to lower productivity. The American farmer produced 7 times more crops than the Soviet farmer, which is why the USSR was importing grain from America and not the other way around. In fact
Hedrick Smith (source: The Russians (1976)) observed that 25% of the agricultural production in the USSR in 1973 was produced on the private plots peasants were allowed (which accounted for 1% of farmable land). Doesn’t sound like a win for the Soviet collective farm if a guy in his backyard can grow 25% of the nation’s food and collective farms holding the other 99% of the farmable land 75%. Should we go back to the definition of efficiency?

3. The Soviet Union failed due to lack of free trade. In fact, only 4% of its GNP came from imports/exports & most of those were with other Eastern Bloc countries. A state monopoly on foreign trade was part of what crushed the Soviet economy.


Rev Scare wrote:Private market competition is replete with externalities, imperfect information, perverse incentives, free rider problems and daunting transaction costs for socially enjoyed goods and services, and allocative failures, all of which lead to gross miscalculations of costs, and therefore mispricing.

No it’s not.No better system exists as you and I both know. There is no force in human history which has afforded more people more freedom while doing more to improve the condition of the average working man than the capitalist system. All of the problems you described above are problems arising from government interference in free market. Let’s take the occurrence of free rider problems: the biggest examples of which being western nation’s massive budget deficit to support welfare economics. Programs to which you advocate. The source of every problem you list above is government interference not the free market.


Again you’re using terms that you’ve read somewhere but don’t actually know anything about. I’ve already written a small novel, but if you want to really get into equilibrium or game theory with me its going to be crushing to the ego I sense in all your writings. I do not advise it and I’m hesitant to allow it. But if you want I can’t stop you. But if you keep throwing around terms you don’t understand I’ll take the gloves off and you’ll come away intellectually destroyed. Stop using terms you don’t understand, especially ones that refute your point not prove it.


Rev Scare wrote:Marx… blah blah blah… capitalism is bad

I changed my avatar to an image of Marx just for you.



Rev Scare wrote:state enterprises may and often do deliberately deviate from market prices in order to fulfill more worthwhile goals, such as ensuring a stable supply of goods, maintaining employment during difficult economic times, allowing for the growth of fledgling but important industries, etc. This alone is reason to believe that the state is more suited for managing an economy than private capitalists.

Allow me to introduce you to a principle that will be new to you called “The Forgotten Man.” You, yourself, are the forgotten man in a great many arrangements as am I. Here’s how it works. You have a politician who wants to be elected. A voter comes to him and says “Mr. Politician I have this horrible problem. Its just an awful circumstance for me and if you could do anything to solve it I’d vote for you and tell all my friends to vote for you now & forever.” The politician goes out and finds a way to get government funding to award a special favor for that constituent because her circumstance is so unique and very unfortunate. The constituent is happy. The politician is happy. But there weren’t 2 parties in that transaction, there were 3. The third party is the Forgotten Man. He’s the one who had his dollar taken from him and given to the constituent. He funded the entire transaction, and he got no benefit, and he’s not happy. Under a capitalist economy, especially one with a small federal government, you don’t have a Forgotten Man. Under a socialist economy that taxes people at 70% or 80% you have a lot of Forgotten Men. Eventually they get pissed off, when they do they are known to do random things that are very unfavorable to repressive socialist governments like tear down the Berlin Wall:





Rev Scare wrote:Exploitation is not the consequence of involuntary contracts: it is a product of the private owners appropriation and distribution of the labor of others through the social relation of wage labor. In other words, the private capitalist is a parasitic middle man who gains something in return for nothing. This unjust social relation is the basis of the capitalist mode of production, and it alone is worthy of its condemnation.


Curious how you’ve decided that political self-interest is somehow nobler than economic self-interest. You’d support a system that rewards political power & massively grows the size of the most inefficient invention of mankind (government), but you oppose a system where millions of people are completely free to each pursue their own individual interests as they see fit. Curious how you feel that free people entering into agreements that they both benefit from are somehow less noble than a socialist arrangement that forcibly seizes property, takes huge proportion of a man’s wages in the form of taxes, etc. Take a hard look at what you believe if you think that a man who pays a 80% tax rate and thus works 9 & 1/2 months out of the year for the government is more free than one who chooses his own profession and keeps his wages in a free capitalist economy. Only dictators hate freedom enough to think that way. You’d advocate making an entire society essentially nothing more than slaves who work to give their earnings to the government yet you hate the fact they might freely choose an occupation they prefer & benefit from. Hmm…



Rev Scare wrote:Taxation is not immoral.

I never said it was. Taxation is a basic part of the social contract everyone makes to live in a society. A government wasting the money of its citizens is immoral.


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Re: The Problem with Libertarianism

Post by Red Aegis on Tue Dec 11, 2012 1:57 pm

You forgot about my response Crying or Very sad

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Re: The Problem with Libertarianism

Post by V for Valjean on Tue Dec 11, 2012 3:27 pm

Red Aegis wrote:You forgot about my response Crying or Very sad

I shall respond immediately my good man, please accept my apologies.

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Re: The Problem with Libertarianism

Post by Rev Scare on Thu Dec 13, 2012 4:38 pm

V for Valjean wrote:I'm glad to see Administrator was able to hide his inability to intellectually defend the core portion of his beliefs by burying this thread to a non-mainstream portion of the forum.

It is quite reasonable to restrict opposing views to a dedicated area of the forum in order to preserve the ideological integrity of the board. This is not at all uncommon. At least we have the courtesy to debate you openly. What is more, the OV section is arguably one of the most active. Cease your complaints.

There are honestly far too many flaws in your post for me to address at once. The following response is by no means an exhaustive critique.

People are better off making their own choices and not relying on government.

This is a vague statement. The choices people possess are in large part the result of institutional arrangements. In a capitalist market context, this means that those with property, educational and genetic endowments, and luck are remunerated more highly than those who lack these means, and are consequently in a privileged position vis–à–vis those who possess little else other than their capacity to work. The latter are compelled to slave underneath this exploitative institution in order to survive and meet any appreciable standard of living. The government often intervenes in the market because the market, independent of capitalism's own contradictions, is inefficient and unjust. In reality, the preponderance of meaningful economic choices are decided by private capitalists, who operate according to the law of value.

I agree with you that an overarching government body which dictates economic policy is undesirable, but it is no less desirable than the tyranny of capital. The aim of socialism is to expand the economic freedom of individuals by providing them with power over their own work and economic fate. To the extent that state socialism has failed to achieve this, it is not an indictment of socialism, but of state socialism. Nonetheless, I maintain that state socialism, for all its shortcomings, prevails over capitalism in several crucial respects, including its ability to provide for all of its citizens, its dynamism, its relative equality, and its stability.

Have you been to Hungary before? Ever visit Eastern Europe, or the Soviet Union or Czech Republic? I have. I was there after the collapse of the socialist governments that started out with the very best intentions. Just like you, they were intending only to improve the lots of their citizens, but – as would you - they all ended up making the people poorer, miserable and into slaves.

Spare me the anecdotes. I live in the contemporary United States, and I am sickened by what I observe.

In the center of Prague is the Grand Hotel Europa. It’s a relic of from the days when Czechoslovakia was one of the wealthiest countries in the world… when I see it I see a reminder of a more productive past before communist central control. The same culture, the same people, the same resources… yet under socialism this country suffered a drastically lower standard of living. That is the result of substituting orders from the top for market incentives from below.

Is this why opinion polls in the former Soviet bloc regularly express widespread dissatisfaction with capitalism? The condition of Eastern Europe after the collapse of the Soviet Union, not to mention its devastating effects upon national liberation movements and other Soviet dependents, was abysmal and remains worse than what it once was. This quote offers but a taste:

"Nearly a decade later [2001] Russia is affected by the worst economic depression in modern history, corruption so extensive that capital flight exceeds all foreign loans and investment, and a demographic catastrophe unprecedented in peacetime. The result has been massive human tragedy. Among other calamities, some 75 percent of Russians now live below the poverty line; 50-80 percent of school-age children are classified as having a physical or mental defect, and male life expectancy has plunged to less than sixty years. And ominously a full nuclearized country and its devices of mass destruction have, for the first time in history, been seriously destabilized, the Kursk submarine disaster in August being yet another example."

[Source: Stephen F. Cohen and Katrina van den Heuvel, Voices of Glasnost (New York: Norton, 1989), 25.]

Needless to say, privatization ushered in the worst form of capitalism (what Marxists would describe as rampant primitive accumulation), and I can cite numerous credible sources bolstering my position that it has immiserated the former Soviet bloc.

Your whole line of logic fails because it does not consider that while political change or political freedom can be achieved very quickly economic freedom and prosperity is a different matter and takes time.

This is a non sequitur. It follows from nothing I have stated, nor is it relevant.

See you are concerning yourself, in my opinion very short sightedly, with the equality of finished results. I am concerned with the equality of opportunity. The system I advocate for below provides equal opportunity to everyone and that is freedom. To have a government give you your small portion, the same portion as your neighbor is given… equality of results… that is not freedom its slavery. Under no circumstance is it correct for government to intervene in a free market system to do something about inequality of results. Not distress, inequality, which is the issue you’ve raised.

Egalitarianism is a noble ideal, but the sort of leveling "equality" you refer to, a straw man, is not what I espouse. Lenin put the matter well when he wrote:

"When one says that experience and reason testify that men are not equal, then one understands under 'equality' the equality of abilities or the equivalence of bodily strength and mental capacities of men. It is quite obvious that in this sense men are not equal. No single reasonable man and no single socialist ever forgets this.

When socialists speak of equality, they understand thereby social equality, the equality of social position, but not at all the equality of physical and mental abilities of individual persons."

Lenin, Vladimir, Lenin: Collected Works, p. 137.

I would contend that what people usually regard as "fair" contains the implicit assumption of equality. The vast inequalities in wealth and power we concern ourselves with are rarely justified. To speak of "equality of opportunity" without consideration of social arrangements which might infringe upon such a matter is vacuous. Capitalism most certainly does not provide every individual with equal opportunity. It is a class system which privileges certain individuals over others as a result of their differential social status (specifically, their relation to the means of production, whether they be owners or workers), as opposed to the manageable factors I believe to constitute the most equitable criteria: effort and sacrifice. Our opportunities are very much constrained by the parameters of our society, and capitalism is a far cry removed from providing genuine opportunities to those who toil beneath.

There most certainly is a universally accepted definition of economic efficiency. Just because the definition is unfavorable to your viewpoint doesn’t mean it doesn’t exist. Efficiency means the use of resources to produce the most goods & services. An economy is more efficient if it can produce more goods & services for its society using fewer resources.

Pure drivel. There is no universal definition of efficiency, and you have utterly failed to refute this basic proposition. Economic growth is not necessarily a sign of "efficiency," as such a notion would presuppose the inherent virtue of economic growth. Moreover, it would assume that capitalist growth is efficient, when this is most fallacious. Your bourgeois conception of "efficiency" ultimately reduces to this: whatever results in the greatest surplus (profit) for the capitalist is deemed efficient, presuming certain (implausible) market conditions, irregardless of its negative effects (following from innumerable externalities) upon the environment and society.

That, of course, is also why the capitalist US won the Cold War and the communist Soviet Union collapsed upon itself… were I to boil down a complicated event to its most fundamental nature: that the Soviet economy was inefficient and unable to keep pace with the US economy. And I use that example because you brought it up although I’ll address it in more detail below.

The cataclysmic collapse of Soviet socialism proclaimed by reactionaries such as you is a myth, pure and simple. It was true that Soviet socialism suffered from serious problems that impeded its economy after around 1970, but these were far from incorrigible. Indeed, nothing like the Great Depression afflicted the USSR. Unlike the United States, which suffers from a serious economic crisis every decade (the latest also its greatest since WWII), the Soviet Union was able to avoid the disruptive boom and bust cycles of capitalist markets throughout its history (inflation was virtually nonexistent until the introduction of market reforms). There were two primary factors which contributed to the dissolution of the Soviet state, and they do not involve any deficiencies inherent to the Soviet economic model: the policies of Mikhail Gorbachev and the nascent petit-bourgeois sector which emerged from the poorly regulated black market economy and flourished under the former.

The United States was always in a more economically and politically favorable situation due to its history. The single greatest predictor of economic standing over the 20th century, from start to finish, was initial wealth. Simply put, the countries with the greatest wealth at the start were also (much more) wealthy in the end because they enjoyed a host of privileges and were not at all averse to engaging imperialist campaigns. Therefore, it is impossible to draw a fair comparison between the Soviet Union and the United States. It would be more appropriate to contrast the vast improvement of conditions within the Soviet Union with that of the abject poverty existing in the capitalist Third World to this very day. However, I do believe a superficial comparison is possible, and it favors the USSR.

I shall address your central argument regarding Soviet inefficiency below.

If you’d stopped at ‘government enterprises typically stray from "equilibrium"’ you’d have the right answer. The fact is that every monopoly in human history has been caused by government interference in the free market.

Monopoly power exists not due to some delusion of government corrupting the immaculate wisdom of the market but because of the same central injustice already explained above: differential access to wealth and power. Capitalists continually seek to accumulate more capital, as this is the basis of their role as capitalists, and so they naturally seek to expand the scale of production over which they maintain dominion. Some capitalists are more successful than others (due to myriad reasons, including luck) and outcompete the rest, and they subsequently entrench their position. This process has a tendency to aggrandize over time, leading to ever greater concentrations of wealth. The entire history of capitalism, regardless of its origins, has borne witness to major capitalists displacing smaller competitors. Today, most industries are dominated by a handful of transnational corporations. No amount of libertarian hogwash will convince anybody remotely connected to the real world that this phenomenon is anything other than a systemic feature of capitalism.

Historically, it was certain strata of the bourgeoisie (those threatened by the power wielded by capitalists who concentrated vast quantities of wealth) that ultimately appealed to the state in order to undermine the power of monopoly capitalists. Anti-trust law possesses very little clout without the enforcement of the state.

From the perspective of the exploited working class, the question of monopoly is trivial. It is often more favorable to work for a major corporation, as the wealth accrued by colossal capitalists allows them to provide better conditions for their employees, not to mention invest in cutting edge research and development, as fewer of them compete for a much larger share of the market. I am also persuaded by certain post-Keynesian arguments which posit the actual superiority of monopoly over highly decentralized competition.

So if you want to talk about government interfering with market prices it only produces bad outcomes: government wastes taxpayer money by purchasing at a higher price than the taxpayer could have & government causes monopolies and other market externalities. And lest you want to respond and discuss monopolies I’ll just do it now and point out that there are only 2 recoded monopolies in human history which have not been caused by some form of government interference in the market, but I don’t believe you have an appropriate knowledge-base to find them so I’ll give them to you: the New York Stock Exchange until the mid 1900s and the DeBeers Diamond Company. If it is monopolies or other market externalities you hate then you prove my point not your own as the only way to avoid those things is to avoid government interference in the free market.

Market competition itself produces externalities, and they more often than not become compounded the more private competition exists. Monopolies need not enter into the equation. I would also like to know why exactly your two examples constitute the only form of monopoly or oligopoly not "caused by some form of government interference in the market." This is completely unsubstantiated.

Also, none of this bears upon anything I have argued thus far, nor do I care to debate the vapid topic of monopoly theory with a libertarian simpleton.

Now to the second part of your statement: “but in order to avoid the heinous consequences of allowing vital services to be subject to the anarchic forces of the market.”

First of all, the state is directed by the dominant class, which in the capitalist mode of production is the bourgeoisie. To speak as though the government acts of its own accord is inane. If the state misappropriates the wealth entrusted to it, then this must be examined within the context of a class analytic framework. If politicians display favoritism toward certain companies, this can be explained away as cronyism, not an unfamiliar phenomenon under capitalism. Second of all, you have proved absolutely nothing, as your circular line of reasoning is impotent, and you have offered nothing to substantiate your assertions.

Plainly you do not believe that government pays way too much for the things it buys because it wants to make a philosophical point and thumb its nose at the “anarchic forces of the market”.

Of course I do not believe it. It is contradicted by historical experience, modern reality, and an understanding of the numerous problems intrinsic to capitalism. The fact that you provide tenuous and scarce evidence reinforces my position.

Let’s not be ludicrous here. Government pays too much for the things it purchase because governments are wasteful & inefficient.The market is efficient because it is made up of people spending their own money on themselves.

These hackneyed liberal talking points mean nothing to me. There is no reason whatsoever to believe that government is somehow more wasteful than private capitalists. The fact that you are the only individual in this thread blinded by such a transparent ideological cover speaks volumes about your (in)competence to engage the subject matter. You have also clearly failed to comprehend my earlier argument: namely, that state enterprises often deviate from equilibrium prices in order to avoid the pitfalls of the market.

Neoliberal ideology denounces government interference for one simple reason: the greed of the capitalist class. Capitalists employ their ideologues in order to justify policies which advance their interests in the class struggle (e.g., deregulation, lower taxation, etc.—often gathered under the umbrella term "supply side" economics) and condemn those which they find cumbersome or threatening (e.g., regulation, taxation, socialization, etc.).

People are very good at determining where they get the best deal. They don’t do a good job when they’re spending someone else’s money. They do the worst job of all when they’re spending someone else’s money on a third party (which is the case of government purchases).

It is quite possible to establish a system wherein people inform government economic policy. The more transparent and democratic government is, the more aligned will be the interests of the state with those of the citizens. In short, the solution to government waste and corruption is the converse of what you propound.

I’ll introduce you to the psychology of how people spend money and how it applies to government waste with this very simple graphic:


Rolling Eyes

I do not care for your bourgeois presumptions. Your claims are unsupported by fact.

There is a fundamental error in Pareto optimality although it has nothing to do with what you’re saying.You may know some of these words but you’ve clearly not yet been exposed to the deeper ideas of them.

I assure you that I am more than capable of continuing this debate. I have read the works of reactionaries far more intellectually keen than you. It is obviously you who does not comprehend me, otherwise you would not offhandedly dismiss my legitimate critique of Pareto efficiency.

The problem with the Pareto theory is that it is fundamentally flawed because it assumes that in order for one party to become better off another must become worse off. In capitalism both parties benefit.

Pareto optimality is a cornerstone of neoclassical economic dogma. It is the basis of mainstream welfare economics and is utilized to justify utility theory. Its proponents believe it justifies capitalist market distribution, but it does not. You must be more enshrouded by Austrian school delusion than you seem to dismiss a fundamental theorem of welfare economics, an important bastion of bourgeois academics. Even Hans-Hermann Hoppe has integrated it into his work.

For all its flaws, Pareto optimality at least attempts to formulate an efficiency criteria capable of being applied to the real world, unlike your subjectivist claptrap.

By definition no transaction can take place unless both parties believe they’re better off for it.

Theoretically, one could be "better off" as a slave. Should we allow such a contract? Subjectively evaluating one's well being as higher relative to other options does not strike at the heart of capitalist injustice: that some individuals, by virtue of their privilege, take advantage of the vulnerabilities of others. Voluntary contracts do not legitimate capitalist social relations.

That brings us to employment, which you take obvious affront to. There is no person employed in any capitalist country in any arrangement for which they’re not better off than their alternative. I don’t care if you want to take a sweatshop worker stitching Nike’s in Asia somewhere. They are better off than their alternative for that job, which is why they’ve CHOSEN FREELY to do it. It is a pure fallacy of reason to assume that you, or a government, or any collection of people could decide better what someone ought to be doing than they themselves can decide. No one knows more about that individual’s situation than he does.

You completely overlook the social pressures which mold behavior. Chinese workers had no choice in the introduction of capitalism. The Russian people had no choice when Boris Yeltsin implemented economic "shock therapy." To more directly address your claim regarding sweatshops, I have three preliminary challenges: 1) the enormous surpluses extracted from workers in the global south, including China, is not reinvested into their economies and so does not in any significant way improve their lives; 2) sweatshop labor is inhumane and serves no other end than to profit private employers. There is no reason to expect Third World workers to ever rise out of poverty because of capitalism, as it develops unevenly across geography. 3) Proletarianization (the transformation of segments of society into wage laborers) often entails the destruction of subsistence farming and renders the new proletarians dependent upon capital. There is no reason to believe they are "better off" under such circumstances, and history would agree with me, as these transitions were usually accompanied by violent protests. The experience of Mexico comes to mind.

Capitalism did not emanate peacefully as a result of harmonic voluntary contracts: it emerged through force according to a brutal process deemed primitive accumulation, which continues to this day. Peasants were expelled from their ancestral lands and concentrated in filthy urban centers to find employment for a pittance, whereas they enjoyed far greater leisure time and consumption goods as self-managed farmers. Highly coercive policies such as the Game Laws and Enclosure Acts expedited the process.

Now to your last point about collectively managed enterprises: there have been many in human history, they’ve all failed.

Not at all. Mondragon Corporation, the largest cooperative in the world, is a multi-billion dollar company. Kantega is a Norwegian IT company regularly listed on the "100 Best Workplaces in Europe." There are tens of thousands of successful cooperatives around the world.

If it was such a great idea to put a bunch of people in a warehouse with no one in charge and let them all own a tiny fraction of what they produce…

Your straw man does nothing for you. Collective firms are self-managed and the profits democratically distributed. Wage differentials are much more narrow in the typical cooperative enterprise than in a traditional capitalist business. This means that the pay the average worker receives in cooperatives is substantially higher than in companies owned by capitalists.

well if that idea led to greater production of goods & services then it would have spread widely long ago. But it doesn’t… history is not on your side my friend.

There are structural disadvantages cooperatives face which prevent them from gaining preponderance in the economy. To quote one market socialist theorist:

"This argument should not be dismissed on the groups that few workers can afford to buy their factories and that the 'radical rich' compose a small set indeed. Nozick's argument admits of a subtler interpretation. If workers really want worker self-management, he may be suggesting then cooperatives will spring up, funded initially by radical philanthropists or wealthy workers. They will be few at first, but if they are technologically and operationally viable, they will gradually attract workers away from the capitalists until the point is reached where everyone is satisfied. As a matter of fact, cooperatives have not undermined capitalism, and so they must be either nonviable economically or unattractive to workers or both. Worker self-management either does not work or is not wanted.

It is tempting to respond to Nozick by appealing to contingent historical facts to explain the failure of cooperative ventures that have appeared (not infrequently) on the capitalist stage. But such a response would focus on the wrong issue. The key issue is not the failure of specific ventures; the key question is why the movement as a whole has not steadily expanded.

But we know the answer to that question, or at least one important answer. The reason is structural. We know from our earlier analysis that a worker-managed firm lacks an expansionary dynamic. When a capitalist enterprise is successful, the owner can increase her profits by reproducing her organization on a larger scale. She lacks neither the means nor the motivation to expand. Not so with a worker-managed firm. Even if the workers have the means, they lack the incentive, because enterprise growth would bring in new workers with whom the increased proceeds would have to be shared. Cooperatives, even when prosperous, do not spontaneously grow. But if this is so, then each new cooperative venture (in a capitalist society) requires a new wealthy radical or a new group of workers willing to experiment. Because such people doubtless are in short supply, it follows that the absence of a large and growing cooperative movement proves nothing about the viability of worker self-management, nor about the preference of workers.

The absence of an expansionary dynamic may be the most basic reason for the failure of cooperative production to grow steadily at the expense of capitalist enterprises, but there are others. Cooperatives tend to be more egalitarian in their income structure; indeed, this egalitarianism is one of the features accounting for their X-efficiency. But this means that a cooperative firm operating in a capitalist environment is in constant danger of having its most skilled managers and workers hired away. Moreover, cooperatives in a capitalist environment are likely to have more difficulty raising capital. Quite apart from ideological hostility (which may be significant), external investors will be reluctant to put their money into concerns over which they will have little or no control—which tends to be the case with a cooperative. Because cooperatives in a capitalist environment face special difficulties, and because they lack the inherent expansionary dynamic of a capitalist firm, it is hardly surprising they are far from dominant.

Note the conclusion that follows: Even if worker-managed firms are preferred by the vast majority, and even if they are more productive, a market initially dominated by capitalist firms may not select for them. The commonsense neoclassical dictum that only things that best accord with people's desires will survive in the struggle for free competition has never been the whole truth with respect to anything; with respect to workplace organization it is barely a half-truth."

Schweickart, David. Against Capitalism, pp. 239-240.

The facts are not on your side. And using a bunch of words you only partially understand won’t change that.

You could not be more wrong. There are literally dozens of studies vindicating the viability of the labor-managed firm, in terms of both productivity and job satisfaction.

I notice the pattern that you fail to suggest what you believe would be optimal, and instead just insult other systems you feel are stupid. So, as this is getting long, do recognize that the true strength in conversation doesn’t lie in putting things down it lies in persuasively presenting your own ideas, which you’ve not even started to do.

My initial response to you was designed to expose and challenge the numerous flaws in your posts. As far as what I consider "optimal" is concerned, the economic model I advocate is market syndicalism as a transitory system toward a participatory planned economy.

On that point: who is to say what government should provide?

The citizens via democratic processes. I believe people should have a say in decisions to the extent that they are affected by them.

Every nation on earth has its own founding document defining the role of government. Likely you’ve heard about these before? Were I to take America as an example the enumerated powers in the Constitution define what the federal government is allowed to do, whether they’ve been deviated from is a separate matter.

Socialism is not explicitly proscribed by the U.S. Constitution, but it is a document I am critical of.

More philosophically, and less specific to any given nation, government ought to do provide those goods and services it can purchase for its citizens at a cheaper price than they can purchase them for themselves.

I agree. The state could provide universal healthcare at a much more reasonable price than private competition can, for example. More broadly, government ought to provide for its citizens whatever its citizens deem worthy of provision, which would likely include basic human necessities that every human being should have a right to receive.

See, what you have forgotten in all your writing, is that government has no money of its own. It only has the tax revenue it collects from its citizens.

I have not forgotten, but it does not bear upon anything I have written. I certainly recognize that a portion of the surplus value capitalists appropriate must be redirected to the state in order to maintain their class hegemony. Marxists have termed this a subsumed class process.

Inflation is just a tax without legislation, so a government that just prints more money so it has some (whereby causing inflation) has really just levied a tax.

I doubt that you understand the various theories of inflation well enough to argue them here. I do not doubt, however, that your simplistic Ron Paul explanation is insufficient.

SO because government has no money but the money its citizens have given it, it is only logical that government should purchase those things it can get a better price for its citizens collectively than they can get for themselves individually. A few exceptions government must provide go to areas like national defense, a court system, etc because they are things citizens cannot individually purchase. Government must also be involved in areas where the transaction of 2 parties effects a 3rd party like in the case of pollution. The problem you have with big government (which you advocate) is that it wastes its citizens money in ways they would never approve of in order to cater to special interests.

Minarchism is constructed upon a tenuous philosophical foundation. The simple fact of the matter is that capitalists themselves require the state to advance their interests, whether it is to enforce contracts, engage in war, invest in R&D, maintain infrastructure, fund utilities they consider too costly, bestow subsidies, or to regulate the volatility of capitalism. The institution of property requires state enforcement. In a word, the capitalist class necessitates a highly interventionist state, which is why minarchy is as fanciful a notion as anarcho-capitalism.

The "special interests" you refer to are exactly what one would expect under capitalism. Those who are in a position of economic privilege possess a disproportionate influence upon politics. The genuine solution to this is the opposite of your own.

That’s why, as an example, in the US you see billions of dollars a year spent to educate people on the health hazard of smoking,

I see this as perfectly reasonable and desirable.

and billions of dollars in subsidies going to the tobacco industry.

That is a contradiction, but this contradiction lies in the fact that the government is not a homogeneous and insulated entity with its own separate interests. The government must instead accommodate various competing interests.

Prove it. Its far from a myth, it’s a proven fact that a free private sector is more productive. If you want to make very pedantic, dogmatic, unfounded statements like that then to this one I shall put the burden of proof on you. And since your entire dogma rests upon this statement being correct I assume you have a very sophisticated and well bolstered explanation for that statement. Lay it on me Rev.

Technically, the burden of proof is on you to prove the superiority of private enterprise over state initiative. It is a historical fact that every nation has relied upon a strong measure of government support in order to develop its economy. Japan and South Korea are economically powerful capitalist countries which relied upon extensive government support. China is no different.

And I’ll lay on you the example of Hong Kong. It has limited space, no natural resources of any kind and until recent history had almost no capital. Through laissez-faire economic policy its become the economic center of all of Asia and has an average standard of living comparable to the United States. That’s the power of capitalism.

Hong Kong is not without government assistance, far from it, much like the aforementioned East Asian countries. In fact, virtually every East Asian "miracle" attributed to free market capitalism is a sham. They were all the products of intense government manipulation. Read this article on the 1997 South East Asian financial crisis.

Please, go find a socialist example… lay the Nordic countries on me where the median household income for a family of 4 is below the US poverty level in 2 out of the 3 of those countries. Go on now, you want to be pedantic and dogmatic then let’s see the substantiation for your dogma.

The Nordic countries are examples of welfare capitalism (in the tradition of John Stuart Mill and T.H. Huxley, for example), not socialism, but I think this is a particularly glaring case of ideological blinding. Do you seriously expect us to believe that Sweden, Norway, and Denmark are somehow "poor"? That the average household resembles that at the U.S. poverty line? These are countries which are rated exceptionally high on various indices attempting to measure standard of living, including the OECD Better Life Index.

Your assertion, which you doubtlessly derived from the silly article by William L. Anderson on Mises.org, does not nothing to challenge the relative success of the Nordic welfare states.

If what you said is true how do you rationalize the long term decline of the Soviet state socialist model and the relative stability & growth of the capitalist western model?

As you can see, the Soviet state collapsed and the capitalist states around it did not. But if you feel the Soviet & Soviet era socialist states were superior let’s take a poll. See you have no idea what you’re actually talking about because you didn’t live there. Neither did I. So let’s take a look at the behavior of the people who did live there. Let’s look at how people voted with their feet. It was Soviet East Germany who had to put up walls to keep its people from leaving not West Germany. Its communist China who has to put border guards out to keep people from fleeing to capitalist Hong Kong not the other way around.

As the poll I linked to illustrates, popular opinion in the former Eastern bloc is decidedly against capitalism. You are exaggerating the degree of emigration from communist states, and it was almost entirely a political matter, not economic. Defectors disagreed with certain authoritarian elements of the state or the ruling party's official ideology, or they left due to political upheaval. The vast majority of the population was content with state socialism, and the single greatest dissatisfaction often expressed was the lack of consumer goods, which was by no means as severe as its opponents claim, and was a deliberate policy of the state, which favored the continued improvement of the forces of production. The fact that the Soviet Union was beleaguered by hostile reactionary forces from its inception compelled it to invest heavily into military armament, which only intensified after WWII and the initiation of the arms race with the United States. As Roger Keeran and Thomas Kenny have described, the commonly cited theory of popular discontent is simply incorrect:

"The second theory [of Soviet collapse] is that popular opposition brought down Soviet socialism. This category is a bit of a straw man, since no writer of note holds that popular opposition alone brought down Soviet socialism. Nevertheless, some authors have stressed such aspects of popular opposition as the disenchantment of intellectuals, the protest of workers, the rise of nationalists, and the electoral successes of non-Communists. Certainly, the disaffection of intellectuals with the Soviet system was quite widespread. By the 1980s, for example, many prominent Soviet economists favored markets. Reform schemes proposed by academics influenced Gorbachev's policies, and in this way intellectuals did contribute to the collapse. Other aspects of popular unrest also played a role. The riots in Baku, the conflict between Azerbaijan and Armenia, the nationalist protests in the Baltics, the strikes by miners, and the formation of a liberal opposition bloc in the Congress of People's Deputies stood out as important moments in the unraveling of Soviet socialism. Still, the main defect of this theory is that popular discontent appeared toward the end rather than the beginning of the Gorbachev reforms. It resulted from Gorbachev's policies rather than caused them. As one wag said, glasnost gave Soviet citizens the license to criticize, and perestroika game them something to criticize. In 1985, however, at the start of the reform process, popular unrest did not exist. While some Soviet people complained about the quantity and quality of consumer goods and about official privileges and corruption, most Soviets expressed satisfaction with their lives and contentment with the system. Polls show that the level of satisfaction of Soviet citizens was comparable to the satisfaction of Americans with their system. Even in 1990-91, as their leaders moved toward private property, marketization, and ethnic fragmentation, Soviet citizens by large majorities favored public ownership, price controls, and the maintenance of the Soviet Union. In the final analysis, popular opposition acted as a dependent rather than an independent variable, a byproduct of Gorbachev's policies rather than their cause."

[Source: Socialism Betrayed: Behind the Collapse of the Soviet Union, pp. 259-60.]

But since the fact Soviet citizens would gnaw their own arm off to escape is likely to not be proof enough for you, let’s have some analysis of the Soviet economy compared to the US economy shall we?

[/font][/color]1. It is true that in the ‘50s the Soviet economy was growing at around 5% a year, which was faster than the United States. But productivity was low and stagnant. For that extra output, the Soviet Union was burning capital. But more to the point, what you’re likely hiding behind is the fact that the Soviet economy grew at an annualized average of 14.6% from 1928-1940. This corresponded with the introduction of industrial manufacturing in the USSR and America experienced nearly identical growth rates during its Industrial Revolution period. Soviet growth in the following decades fell to an average of 7% in the ‘60s then 5.3% in the 70’s then 3.2% in the 80’s (and that’s using very liberal numbers it was likely much lower). Gradual decline, eventual collapse, failure of (and the abandonment of) the government run command economy. End of story.

It is not truly appropriate to compare the economic performance of the Soviet Union to that of the United States. The ideological differences influencing economic development aside, the USSR and the United States entered the 20th century on highly unlike terms. One was already an industrial power; the other was a backward agricultural society comprised of mostly peasants. A more insightful comparison would be to the other poor countries in Latin America, Asia, and the Middle East, which the Soviet Union dramatically surpassed. The capitalist Third World is testament to the global failure of capitalism. Nonetheless, Soviet performance was quite remarkable and superior to the United States in a number of important respects.

The Soviet industrial revolution industrialized the country in a decade, as compared to the century it required the United States to surpass the Western European powers under ideal and inimitable conditions. Would capitalism have achieved the same level of industrial output? The most accurate models of Soviet progress I am aware of unequivocally say no.


[Source: Robert C. Allen, Farm to Factory: A Reinterpretation of the Soviet Industrial Revolution (Princeton: Princeton University Press, 2003)]


[Source: Allen (2003).]


Ibid.


Ibid.


Ibid, p.164.

Its economic growth was exceptional, and it attained the status of a military-industrial superpower in two decades. Its economy was quite robust for the majority of its existence, even during unfavorable periods.


[Source: Robert C. Allen (2005), “A Reassessment of the Soviet Industrial Revolution,” Comparative Economic Studies, Vol. 42, p. 10.]

In fifty years, the country attained an industrial output that was 80 percent of that of the United States (from a start of 12%) and an agricultural output that was 85 percent, but its citizens enjoyed advantages the United States could never offer.


[Source: Allen 2005, p. 18.]

The Soviet economic slowdown toward the last two decades of its existence are attributed by unbiased economists to outdated planning techniques, the failure to incorporate new technology into the production process (as a result of the planning board's overwhelming focus upon quantity of output), lax labor discipline (partially due to the same principal-agent problem found in capitalism), heavy military investment (not in small part a response to direct U.S. aggression), decentralization and greater dedication to consumer goods under Khrushchev, and a focus upon extensive rather than intensive production. All of these problems were rectifiable, and they would have been if Yuri Andropov had not died prematurely. The fragmentation of the Soviet Union was overwhelmingly the result of specific policies enacted under Gorbachev.

2. The Soviet collective farms were an abysmal failure due to lower productivity. The American farmer produced 7 times more crops than the Soviet farmer, which is why the USSR was importing grain from America and not the other way around. In fact [/font][/color][color=white][font='Arial']Hedrick Smith (source: The Russians (1976)) observed that 25% of the agricultural production in the USSR in 1973 was produced on the private plots peasants were allowed (which accounted for 1% of farmable land). Doesn’t sound like a win for the Soviet collective farm if a guy in his backyard can grow 25% of the nation’s food and collective farms holding the other 99% of the farmable land 75%. Should we go back to the definition of efficiency?

Soviet collective farms most certainly were not failures. Apart from the initial suppression of kulaks, collective farms quickly rebounded and Soviet agricultural output per hectare rose to approximately resemble U.S. levels. The actual hindrance to early Soviet agriculture was not organizational form but lack of mechanization, which was not an easily remedied problem. To quote Robert C. Allen once more:

"The history of wheat yields on the Great Plains provides a counterfactual experiment showing the possibilities open to Soviet agriculture. They were modest. Yields were about 1200 kg/hectare in North Dakota before 1900 and only about 500 in Russia. In both regions, yields converged to about 700 kg/hectare in the 1920s and 1930s although they could drop much lower due to drought or political turmoil. After World War II, yields rose several fold in both North Dakota and the USSR when fertilizers transformed the situation. [The data reveals two important lessons about Soviet agriculture.] The first is that its productive history, as measured by yields per acre, has been indistinguishable from that of environmentally similar regions in North America. There is no evidence of Soviet failure in this regard. Second, before the 1950s, there was no prospect of increasing food production by raising yields in the Soviet Union.

Likewise with livestock. More meat and milk could be produced by feeding the sheep and cattle better, but even here the gains were not dramatic and came at a high cost. Better breeds might gain weight more rapidly, but in the event would also require more food to feed. And improving the quality of Russian livestock was bound to be a slow process under any system of social organization. There was no Green Revolution technology that could provide a quick fix to Russian agriculture and that would increase farm output at the rapid rates achieved in many developing countries since the 1960s."

[From Farm to Factory: A Reinterpretation of the Soviet Industrial Revolution, pp. 71-72. Ed. by me.]

3. The Soviet Union failed due to lack of free trade. In fact, only 4% of its GNP came from imports/exports & most of those were with other Eastern Bloc countries. A state monopoly on foreign trade was part of what crushed the Soviet economy.

This is yet another baseless assertion. The Soviet Union enjoyed an abundance of natural resources and was politically disposed toward self-sufficiency. Comparative advantage is a long discredited theory. Do not expect us to take any of your neoliberal postulates as axiomatic.

Soviet socialism was superior to capitalism in that it abolished private ownership in the means of production and wealth acquired through mere entitlement to it, production was oriented toward use rather than exchange, unemployment was virtually eliminated, market fluctuations were transcended, a generous welfare state was readily maintained, and its capacity for industrial output relative to most capitalist states was extraordinary.

No it’s not.No better system exists as you and I both know. There is no force in human history which has afforded more people more freedom while doing more to improve the condition of the average working man than the capitalist system.

Capitalism has inflicted countless human misery since its beginning through wars, imperialism, and merciless exploitation. The only positive features of capitalism are its economic dynamism and robust social division of labor, which ultimately pave the way toward socialism, a system that will hopefully one day transcend it. While it has unleashed mankind's ability to create on an unprecedented scale in history, it has also desolated the environment, impoverished most of the planet, and oppressed the majority of humankind. Capitalism's central injustice, its exploitative class relations, and all of the ensuing contradictions, cannot be justified, and I encourage you to assail this with your full intellectual might.

All of the problems you described above are problems arising from government interference in free market.

No, they are not. This is an absurd position, as it completely insulates real existing capitalism from critique. The government interferes in the market when the ruling class calls upon it to do so. The market is not the miraculous system of distribution your bourgeois theories would have us believe. As touched upon previously, markets operate according to blind coordination of resources (termed commodity fetishism), which precludes any possibility of a self-conscious evaluation of economic relationships, antagonistic roles (neither buyers nor sellers are incentivized to consider the situation of the other; rather they are often placed in roles with opposing interests), workplace hierarchy, antisocial biases (e.g., externalities, daunting transaction costs and free rider problems for social goods, an inability to consider economic impacts outside of the myopic buyer-seller relationship, etc.), periodic crises (as I reject both the neoclassical and Austrian business cycle theories, and I only partially agree with the Keynesian explanation, I would appreciate if you would refrain from issuing the standard apologies for the capitalist market's cyclical chaos), and enshrine unjust remunerative norms.

Let’s take the occurrence of free rider problems: the biggest examples of which being western nation’s massive budget deficit to support welfare economics. Programs to which you advocate. The source of every problem you list above is government interference not the free market.

Welfare is a means-tested benefit. It cannot be considered a free rider problem. The budget deficit is a consequence of the contradictory policy of lowering tax rates whilst failing to reduce expenditures (not least of which is appropriated for military purposes in order to finance imperialist wars), and this follows directly from the neoliberal policies of the past three decades. The simple solution is to increase tax rates on corporations, the wealthy, and capital gains. My suggestion is to revert to the reasonable rates of around 90% or so in the couple decades subsequent the Second World War.

[color=white][font='Verdana']Again you’re using terms that you’ve read somewhere but don’t actually know anything about. I’ve already written a small novel, but if you want to really get into equilibrium or game theory with me its going to be crushing to the ego I sense in all your writings. I do not advise it and I’m hesitant to allow it. But if you want I can’t stop you. But if you keep throwing around terms you don’t understand I’ll take the gloves off and you’ll come away intellectually destroyed. Stop using terms you don’t understand, especially ones that refute your point not prove it.[b]

By all means, do us the honor of enlightening us benighted souls with your profound educational background. On a serious note, I can convey market inefficiency using game theoretic jargon if you should so desire, but I strongly doubt that you shall return to grace us with your wisdom once more.

Allow me to introduce you to a principle that will be new to you called “The Forgotten Man.” You, yourself, are the forgotten man in a great many arrangements as am I. Here’s how it works. You have a politician who wants to be elected. A voter comes to him and says “Mr. Politician I have this horrible problem. Its just an awful circumstance for me and if you could do anything to solve it I’d vote for you and tell all my friends to vote for you now & forever.” The politician goes out and finds a way to get government funding to award a special favor for that constituent because her circumstance is so unique and very unfortunate. The constituent is happy. The politician is happy. But there weren’t 2 parties in that transaction, there were 3. The third party is the Forgotten Man. He’s the one who had his dollar taken from him and given to the constituent. He funded the entire transaction, and he got no benefit, and he’s not happy. Under a capitalist economy, especially one with a small federal government, you don’t have a Forgotten Man. Under a socialist economy that taxes people at 70% or 80% you have a lot of Forgotten Men. Eventually they get pissed off, when they do they are known to do random things that are very unfavorable to repressive socialist governments like tear down the Berlin Wall:


Is the "Forgotten Man" some caricature of Ayn Rand's metaphorical Atlas? "Who is John Galt?"

Curious how you’ve decided that political self-interest is somehow nobler than economic self-interest. You’d support a system that rewards political power & massively grows the size of the most inefficient invention of mankind (government), but you oppose a system where millions of people are completely free to each pursue their own individual interests as they see fit.

I support democratic political and economic structures. It is curious that you support dictatorships within the sphere of economics but "freedom" everywhere else.

Curious how you feel that free people entering into agreements that they both benefit from are somehow less noble than a socialist arrangement that forcibly seizes property, takes huge proportion of a man’s wages in the form of taxes, etc. Take a hard look at what you believe if you think that a man who pays a 80% tax rate and thus works 9 & 1/2 months out of the year for the government is more free than one who chooses his own profession and keeps his wages in a free capitalist economy. Only dictators hate freedom enough to think that way. You’d advocate making an entire society essentially nothing more than slaves who work to give their earnings to the government yet you hate the fact they might freely choose an occupation they prefer & benefit from. Hmm…

Since you have failed to provide either an ethical or a utilitarian opposition to higher taxes I find persuasive, there is no reason for me to accept your stance. Taxation is not theft, as you have implicitly accepted in your earlier comment. Drawing a line beyond which taxation becomes "slavery" is wholly arbitrary without, at the very least, some pretense of a theory of justice. Not only is your basic argument lacking, but you have conveniently obscured the exploitative capitalist class relationship in your ramblings about "free people entering into agreements that they both benefit from." I am reminded of the preposterous Nozickian "Wilt Chamberlain" argument, but this is likely no coincidence.

I never said it was. Taxation is a basic part of the social contract everyone makes to live in a society. A government wasting the money of its citizens is immoral.

Your definition of what is and is not to be regarded as "inefficient" and "wasteful" government behavior is arbitrary, and you have failed to demonstrate how and why government is less competent to manage the economy than private capitalists.


Last edited by Rev Scare on Fri Dec 14, 2012 1:18 am; edited 1 time in total

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Re: The Problem with Libertarianism

Post by Celtiberian on Fri Dec 14, 2012 12:06 am

Since Rev Scare thoroughly refuted your post in his latest response, I will confine myself to elaborating on a few select points. But, before I begin, I just want to mention that I quite enjoy your user name—Jean Valjean is among my favorite fictional characters.

V for Valjean wrote:I'm glad to see Administrator was able to hide his inability to intellectually defend the core portion of his beliefs by burying this thread to a non-mainstream portion of the forum.

Rev Scare and Admin were merely expressing their concern with individuals who espouse oppositional political philosophies posting in the main forum. We intentionally created the Opposing Views section so conversations among comrades wouldn't be interrupted with broader ideological questions. In no way did their remarks represent a desire to silence you or an inability to defend their beliefs. On the contrary, we are fully prepared to engage in dialog with civil propertarians, such as yourself.

People are better off making their own choices and not relying on government.

Sometimes government is the only method by which people can express their preferences. Take, for example, the allocation of tax revenue for public goods.

Have you been to Hungary before? Ever visit Eastern Europe, or the Soviet Union or Czech Republic? I have. I was there after the collapse of the socialist governments that started out with the very best intentions. Just like you, they were intending only to improve the lots of their citizens, but – as would you - they all ended up making the people poorer, miserable and into slaves.

In the center of Prague is the Grand Hotel Europa. It’s a relic of from the days when Czechoslovakia was one of the wealthiest countries in the world… when I see it I see a reminder of a more productive past before communist central control. The same culture, the same people, the same resources… yet under socialism this country suffered a drastically lower standard of living. That is the result of substituting orders from the top for market incentives from below.

I've not visited the former Soviet bloc, nor would I have been able to at a relevant time as I was but a small child when the nomenklatura's counterrevolutions occurred. I am, however, well enough versed in the subject to recognize that you have presented a gross simplification of the situation.

You speak of the citizens of the Soviet bloc as having been "slaves," and I certainly wouldn't deny that they suffered under an oppressive, authoritarian state apparatus and experienced technocratic domination in their economic life; but it's not as though we enjoy a vibrant, participatory democratic polity under capitalism either. In the United States, at least, we essentially have a political duopoly wherein our two parties represent different segments of capital. (I recommend Thomas Ferguson's Golden Rule: The Investment Theory of Party Competition and the Logic of Money-Driven Political Systems and the documentary film by the same name, if you're interested in an in-depth analysis of the subject.) Of course, many propertarians are explicit in their disdain for democracy (e.g., Hans-Hermann Hoppe, Bryan Caplan, and Peter Schiff) and preference for capitalist technocracy, minarchism, or even outright anarcho-capitalism, because they consider taxation to be economically inefficient and morally reprehensible. Perhaps you're in agreement with them, in which case you're only arguing against state oppression, while tacitly endorsing private oppression.

As for the alleged failures of centralized economic planning, you ignore the fact that it is responsible for industrializing the Soviet Union at far more rapid a pace than following market principles ever could have, as confirmed by the previously cited work, Robert C. Allen's Farm to Factory: A Reinterpretation of the Soviet Industrial Revolution. As a matter of fact, the world's leading economies all developed by violating market principles in almost every conceivable way (see, for example, Ha-Joon Chang's Kicking Away the Ladder: Development Strategy in Historical Perspective for a detailed examination of the role state subsidies, tariffs, and various other forms of intervention had in the economic development of the OECD countries).

Propertarians constantly try to have it both ways: they often claim that the criticisms people have of the system are legitimate, but aren't attributable to capitalism because it has 'never existed.' Indeed, we aren't experiencing "true" capitalism at all, according to this narrative, because the state is distorting markets—'corporatism' or 'fascism' are the epithets they prefer to use when describing this mode of production. And yet these same propertarians give credit to capitalism for the dynamism and technological development witnessed over the past two centuries. Of course, we Marxists scoff at such twaddle, as we don't define capitalism in terms of how laissez-faire a market is, but rather by what the property and social relations happen to be in a country.

I can't specifically address your unfortunate experience in Czechoslovakia because I'm not familiar with the history of their experience under Soviet hegemony. However, being that you admit to having visited the country after the demise of state socialism, I don't see how your visit can be accepted as evidence of the inefficiency of that particular economic arrangement. It's well known that after state assets were privatized in Eastern Europe, the entire region fell into disarray, which literally took them decades to recover from. One recent study found that the economic "shock therapy" engineered by the bourgeois economist Jeffrey Sachs and implemented first by the Yeltsin regime was responsible for taking the lives of as many as one million citizens across the Eastern bloc.

It may interest you to know that, at least in Hungary and Romania, opinion polls regularly indicate that the individuals old enough to have experienced both state socialism and capitalism routinely express their preference for the former mode of production. And in Russia, the Communist Party receives the second-highest percentage of votes in virtually every presidential election. Do you not find it peculiar that the Eastern European masses could prefer a system which, to paraphrase you, resulted in making them into 'poor slaves'? Either they're delusional, or capitalism has failed them far worse than state socialism ever did.

None of this concerns most members of the Socialist Phalanx regardless, since very few of us are advocates of state socialism—I certainly am not. Nevertheless, the chief problem with centralized economic planning, apart from the obvious ethical issues related to technocratic hierarchy, is that planners were using inadequate means by which to gather data. An infamous problem found in state socialism, that of chronic shortages of certain consumer goods, was due in large part to the government subsidizing prices for popular products, thereby artificially placing them beneath their labor value and making them too easy to access as a result. The absence of a Walrasian market clearing mechanism, and lack of a device capable of relaying consumption patterns to planners in real time, made efficiently allocating resources for consumer goods nearly impossible. To compound those problems, wasteful diversions of resources into military production (to keep pace with the arms race), and foolish bureaucratic decisions to renovate old factories instead of building new ones, started taking a serious toll on the Eastern European economies by the 1970s.

W. Paul Cockshott and Allin Cottrell, however, have demonstrated that modern information technologies can process the algorithms generated in a complex economy in a manner conducive to socialist planning. Thus, were an economically developed country to embark on a policy of comprehensive centralized planning today—utilizing the information we've gathered from the shortcomings of the Soviet experience—I have little doubt that it could outperform a comparable capitalist country. It would be an ethical improvement as well, though, in my opinion, justice truly demands nothing short of libertarian socialism (of the syndicalist variety).

I am concerned with the equality of opportunity. The system I advocate for below provides equal opportunity to everyone and that is freedom.

Nonsense. The notion of capitalism being meritocratic is objectionable on a number of grounds. Take, for instance, starting a business. To acquire a loan, one must be deemed "credit worthy." In the context of capitalism, that translates into possessing collateral. Hence, asset-poor individuals are systematically discriminated against and are therefore denied the "equal opportunity" to take advantage of entrepreneurial opportunities. Then we have the unfortunate fact that vast segments of humanity are born into conditions which impede their cognitive development, thereby handicapping them in the labor market. Meanwhile, other people are born into lavish surroundings, which not only provide them with the nourishment necessary for optimal cognitive development, but which provides them with wealth and social networks that advantage them in myriad ways. Simply put, money begets money. Meritocracy cannot be attained within the confines of class society.

As a luck egalitarian, I don't believe that wealth inequalities derived from brute luck, whether in environmental surroundings or genetic endowment, are justifiable. The only ethically permissible variations in income should be attributable to the responsible choices individuals make, which is why I believe that effort and sacrifice are the only morally relevant factors to measure when remunerating labor.

To have a government give you your small portion, the same portion as your neighbor is given… equality of results… that is not freedom its slavery. Under no circumstance is it correct for government to intervene in a free market system to do something about inequality of results. Not distress, inequality, which is the issue you’ve raised.

First of all, no one has suggested that everyone should be remunerated identically. Secondly, you have not explained why it is you happen to believe that market allocations of resources are impervious to criticism.

The fact is that every monopoly in human history has been caused by government interference in the free market.

Setting aside the fact that it's impossible to empirically prove such an assertion, have you never heard of natural monopolies (e.g., water services and electricity)?

People are very good at determining where they get the best deal.

...And yet private debt (consumer and corporate) surpasses sovereign debt by leaps and bounds:



That brings us to employment, which you take obvious affront to. There is no person employed in any capitalist country in any arrangement for which they’re not better off than their alternative. I don’t care if you want to take a sweatshop worker stitching Nike’s in Asia somewhere. They are better off than their alternative for that job, which is why they’ve CHOSEN FREELY to do it. It is a pure fallacy of reason to assume that you, or a government, or any collection of people could decide better what someone ought to be doing than they themselves can decide. No one knows more about that individual’s situation than he does.

As I've explained elsewhere, the Marxist charge of exploitation pertains to the immorality of taking advantage of a person's relative economic vulnerability for reasons of self-enrichment. Private ownership of the means of production and the institution of wage labor enables a class of people (the bourgeoisie) to dominate and instrumentalize the vulnerability of another class (proletarians), thus allowing the former group to appropriate the latter's labor. No one is arguing that people currently possess a superior alternative to this humiliating and repugnant state of affairs—with the slight exception of proletarians who happen to live near worker cooperatives operating in an industry they possess an aptitude for—but that's precisely why socialists demand the collectivization and democratization of the means of production.

Now to your last point about collectively managed enterprises: there have been many in human history, they’ve all failed.

Is that right? I'm sure this information would come as a surprise to members of the (approximately) 108,000 worker cooperatives in Venezuela; 5,000 in Italy's Emilia-Romagna "red belt" region; 200 in Argentina; several thousand in North America; the 120,000 kibbutz members in Israel; and the nearly 100,000 workers in one of Spain's largest and most successful businesses, the Mondragón Cooperative Corporation (a federation of hundreds of worker cooperatives).

You assume it's an inefficient organizational form because of the relative scarcity of labor-managed firms in capitalist countries, but their efficiency has never been the issue—in fact, virtually every major study conducted on the performance of worker cooperatives has found that they are just as efficient as comparable capitalist enterprises, and frequently more so. I won't even get into the positive correlation between participation in management and overall job satisfaction researchers have consistently found, because I doubt that would interest someone like you. What may interest you, however, is that an entire revolution occurred in northern Spain in 1936 (which my great-grandfather participated in, incidentally) wherein workers' self-management was generalized across industry and agriculture; and a sharp rise in productivity in many sectors of the economy was achieved as a result. It was brutally suppressed by Francisco Franco's forces of reaction following the Civil War, but it still serves as an inspiration to we libertarian socialists.

The real cause of worker cooperatives' scarcity is multifaceted. First and foremost, they lack the expansionary dynamic capitalist enterprises have. As the Schweickart quote provided earlier mentions, worker cooperatives are structured so as to maximize profit per worker, not aggregate profits. Consequently, they are less likely to expand under conditions of constant returns to scale than are capitalist firms. Another major problem is the fact that workers simply don't know anything about this way of organizing enterprises, so there are very few attempts to actually start cooperatives. In his 1989 paper, “From Here to There; or, If Cooperative Ownership Is So Desirable, Why are There So Few Cooperatives?” (Social Philosophy and Policy, Vol. 6, No. 2, pp. 93-111), Jon Elster also provides evidence of various instances throughout history of capitalists actively conspiring to sabotage labor-managed firms for purely ideological reasons.

If it was such a great idea to put a bunch of people in a warehouse with no one in charge and let them all own a tiny fraction of what they produce… well if that idea led to greater production of goods & services then it would have spread widely long ago. But it doesn’t… history is not on your side my friend.

See above. Also, you're presenting a misleading image of what it is syndicalists advocate. Horizontal social relations aren't some sort of free for all, devoid of organization and authority. To quote Mikhail Bakunin,

"Does it follow that I reject all authority? Far from me such a thought. In the matter of boots, I refer to the authority of the bootmaker; concerning houses, canals, or railroads, I consult that of the architect or engineer. For such or such special knowledge I apply to such or such a savant. But I allow neither the bootmaker nor the architect nor the savant to impose his authority upon me. I listen to them freely and with all the respect merited by their intelligence, their character, their knowledge, reserving always my incontestable right of criticism and censure. I do not content myself with consulting authority in any special branch; I consult several; I compare their opinions, and choose that which seems to me the soundest. But I recognize no infallible authority, even in special questions; consequently, whatever respect I may have for the honesty and the sincerity of such or such an individual, I have no absolute faith in any person. Such a faith would be fatal to my reason, to my liberty, and even to the success of my undertakings; it would immediately transform me into a stupid slave, an instrument of the will and interests of others.

If I bow before the authority of the specialists and avow my readiness to follow, to a certain extent and as long as may seem to me necessary, their indications and even their directions, it is because their authority is imposed upon me by no one, neither by men nor by God. Otherwise I would repel them with horror, and bid the devil take their counsels, their directions, and their services, certain that they would make me pay, by the loss of my liberty and self-respect, for such scraps of truth, wrapped in a multitude of lies, as they might give me.

I bow before the authority of special men because it is imposed upon me by my own reason. I am conscious of my inability to grasp, in all its details and positive developments, any very large portion of human knowledge. The greatest intelligence would not be equal to a comprehension of the whole. Thence results, for science as well as for industry, the necessity of the division and association of labor. I receive and I give—such is human life. Each directs and is directed in his turn. Therefore there is no fixed and constant authority, but a continual exchange of mutual, temporary, and, above all, voluntary authority and subordination
."
Mikhail Bakunin, God and the State (New York: Dover Publications, 1970), pp. 32-33.

Every nation on earth has its own founding document defining the role of government. Likely you’ve heard about these before? Were I to take America as an example the enumerated powers in the Constitution define what the federal government is allowed to do, whether they’ve been deviated from is a separate matter.

Surely an individual of your ideological disposition wouldn't have considered the Soviet Constitution to be legitimate, so what makes you think socialists accept the principles outlined in the United States' Constitution?

Let’s take the occurrence of free rider problems: the biggest examples of which being western nation’s massive budget deficit to support welfare economics. Programs to which you advocate.

Which programs would those be, exactly? Universal health care? You'll notice that, in addition to being more cost effective than the private system currently practiced in the United States,



the free-rider problem has not been of any consequence:



As Rev Scare said, means testing serves to keep free riding to a minimum in social programs.

Allow me to introduce you to a principle that will be new to you called “The Forgotten Man.” You, yourself, are the forgotten man in a great many arrangements as am I. Here’s how it works. You have a politician who wants to be elected. A voter comes to him and says “Mr. Politician I have this horrible problem. Its just an awful circumstance for me and if you could do anything to solve it I’d vote for you and tell all my friends to vote for you now & forever.” The politician goes out and finds a way to get government funding to award a special favor for that constituent because her circumstance is so unique and very unfortunate. The constituent is happy. The politician is happy. But there weren’t 2 parties in that transaction, there were 3. The third party is the Forgotten Man. He’s the one who had his dollar taken from him and given to the constituent. He funded the entire transaction, and he got no benefit, and he’s not happy.

This thought experiment assumes that the so-called "Forgotten Man" amassed his income independently, which is fallacious. From birth, we are embedded in social relations which are integral to our being able to earn a living. The "Forgotten Man" is the beneficiary of a publicly-funded infrastructure and the sum total of all human knowledge, without which he would be a lone savage, foraging for food in the wilderness. (For more on the social sources of wealth, see Gar Alperovitz and Lew Daly's Unjust Desserts: How the Rich Are Taking Our Common Inheritance.) It also assumes that the resources one acquires on the market are ethically unobjectionable, which socialists reject for reasons I elucidated above.

Moreover, if we discard John Locke's arbitrary and philosophically indefensible theory of land acquisition, and instead uphold common ownership, it follows that property in all external things should be viewed as jointly owned—since their components invariably originate in raw materials derived from the land. This may seem like an extreme conclusion to draw, but the implications aren't that drastic. For instance, since possessions for active personal use (homes, cars, computers, etc.) are, for the most part, rather benign, it makes sense to only apply moderate regulations to them. The manner by which the means of production are organized and utilized, by contrast, affects society in profound ways; e.g., it influences how people are remunerated (exploitatively or justly), the social relations we live under, war and peace, and whether or not ecological sustainability can be achieved.

Simply put, since 'no man is an island,' your "Forgotten Man" is illusory.

Under a capitalist economy, especially one with a small federal government, you don’t have a Forgotten Man. Under a socialist economy that taxes people at 70% or 80% you have a lot of Forgotten Men. Eventually they get pissed off, when they do they are known to do random things that are very unfavorable to repressive socialist governments like tear down the Berlin Wall:


Interesting you should cite post-state socialist Germany, considering the vast popularity the welfare state maintains among the citizenry there, and the fact the size of their federal government today can hardly be upheld as a model of minarchism.



but you oppose a system where millions of people are completely free to each pursue their own individual interests as they see fit.

No one has proposed anything of the sort. Contrary to what you believe, it is only through socialism that one has a genuine opportunity to attain self-realization in labor.


Last edited by Celtiberian on Fri Dec 14, 2012 1:24 am; edited 1 time in total

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Re: The Problem with Libertarianism

Post by Admin on Fri Dec 14, 2012 1:22 am

V for Valjean wrote:Have you been to Hungary before? Ever visit Eastern Europe, or the Soviet Union or Czech Republic? I have. I was there after the collapse of the socialist governments that started out with the very best intentions. Just like you, they were intending only to improve the lots of their citizens, but – as would you - they all ended up making the people poorer, miserable and into slaves.


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Re: The Problem with Libertarianism

Post by V for Valjean on Fri Dec 14, 2012 5:24 am

@ Admin - nice video. If that guy, and anyone else who'd actually lived under socialism and communism, were to join your forum though he'd be restricted.

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Re: The Problem with Libertarianism

Post by Rev Scare on Fri Dec 14, 2012 6:15 am

V for Valjean wrote:@ Admin - nice video. If that guy, and anyone else who'd actually lived under socialism and communism, were to join your forum though he'd be restricted.

This is a socialist message board. We cannot allow ideologically opposed members to post on the main forum, as this would detract from discussions pertinent to the website's political orientation. This is the appropriate section for individuals who do not align themselves with the core principles of this forum. You are perfectly free to continue to post in the OV section in a civil capacity. Otherwise, you may post on the main forum so long as you refrain from infusing discussions with views which conflict with socialism, as you have thus far been doing. This is not an uncommon practice on political forums.

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Re: The Problem with Libertarianism

Post by Red Aegis on Fri Dec 14, 2012 8:30 am

V for Valjean wrote:@ Admin - nice video. If that guy, and anyone else who'd actually lived under socialism and communism, were to join your forum though he'd be restricted.

You ignore all the arguments against you and focus on little things, twist the meaning, and knock that strawman down.

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