Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Seven Fixes for American Capitalism

bloomberg.com

Post reply on HN
Print view View original

101–110 of 146 posts

Re: Seven Fixes for American Capitalism

#101

Post by iooi »

mruts wrote: post #71
dnautics wrote: post #54

No mention of ending inflation, which is a deliberate state-driven policy to steal from the poor to give to the rich and make the state "look good" by lowering the metric of unemployment: https://krugman.blogs.nytimes.com/2010/02/13/the-case-for-hi... "even in the long run, it’s really, really hard to cut nominal wages. Yet when you have very low inflation, getting relative wages right would require that a significan…

What are you talking about? The point of inflation is to encourage the spending and investment of money. It doesn’t really have anything to do with unemployment.

I recommend taking an Economics course.

https://en.wikipedia.org/wiki/Phillips_curve

Re: Seven Fixes for American Capitalism

#102

Post by api »

zozbot123 wrote: post #88
api wrote: post #58

Earlier quoted context omitted.

Another thing the pricing test favored by the Chicago School doesn't consider is the effect of consolidation on entrepreneurship. Huge consolidated companies become de-facto standards that are hard to compete with for many many reasons and that have the resources to simply buy or clone any competitor in its crib. In the computing world they also tend to become platform monopolies with strong lock-in from APIs and net…

It's weird to me to see a narrow "pricing approach" towards antitrust being attributed to the Chicago School. I thought the Chicago perspective on antitrust was that it should potentially be applied to markets that aren't "contestable" (i.e. have high barriers to entry) for either structural or regulatory reasons, and in particular, that well-designed regulation could be used in such cases to minimize and constrain t…

It's possible that as with Keynes' advice about counter-cyclic spending the Chicago school's views on monopoly and antitrust have been distorted by politicians and lobbyists.

In the case of Keynes counter-cyclic spending became "deficits don't matter, always spend more no matter what." In recessions spending goes up and in booms spending goes up. Keynes argued that governments should cut during booms to achieve something at least close to a net balance, but the cutting part is ignored.

Re: Seven Fixes for American Capitalism

#103

Post by AnimalMuppet »

claudiawerner wrote: post #96
AnimalMuppet wrote: post #77

Earlier quoted context omitted.

One definition of capitalism is simply the re-investment of profits into improvements - better tools, for example. That in no way implies poverty as a structural element.

I believe what GP is trying to say is that capitalism necessarily creates such an element, since they view it as a class structure society.

I believe that's what they are saying, too. I think it's flat-out wrong.

If you and I are both working stiffs, and we both have $50 left at the end of the month, and you buy some beer, and I buy a used sewing machine so I can take sewing jobs in the evening, then I'm a capitalist and you aren't. That doesn't make us of different classes, though, (except that I may be mentally at a different place than you are).

Re: Seven Fixes for American Capitalism

#104

Post by mruts »

dnautics wrote: post #83
mruts wrote: post #71

Earlier quoted context omitted.

What are you talking about? The point of inflation is to encourage the spending and investment of money. It doesn’t really have anything to do with unemployment.

Fine, if that's what you believe is the point of inflation. Whom does "investment" benefit? Go down to the tenderloin in SF, look around, and ask yourself if these people are benefitted by 'investment'. And the mechanism, as indicated in the quote, has at least a side effect of lowering the real value of workers (his words, not mine) wages. Inflation is exactly stealing from the poor to give to the wealthy. There's a…

You’re getting this backwards. Inflation helps the poor because the rich are much more likely to invest in job creation (by spending money and hiring people), when we have inflation. deflation is terrible for the poor, unemployment goes up and job creation goes down. If you look at historical data of inflation vs unemployment I’m sure you’ll come to the same conclusion.

If the money supply doesn’t increase, it’s actually deflationary, due to population growth. If inflation is 0, it means that the money supply is increasing at the same rate as production. To provide good incentives, you want the money supply to slightly outpace the growth in production. Which is what 1-2% inflation precisely does.

Clearly, super inflation is distinctly bad for the poor, but that’s different from inflation that slightly out paces population growth.

Almost all economists are of the same opinion.

Re: Seven Fixes for American Capitalism

#105

Post by claudiawerner »

AnimalMuppet wrote: post #103
claudiawerner wrote: post #96

Earlier quoted context omitted.

I believe what GP is trying to say is that capitalism necessarily creates such an element, since they view it as a class structure society.

I believe that's what they are saying, too. I think it's flat-out wrong. If you and I are both working stiffs, and we both have $50 left at the end of the month, and you buy some beer, and I buy a used sewing machine so I can take sewing jobs in the evening, then I'm a capitalist and you aren't. That doesn't make us of different classes, though, (except that I may be mentally at a different place than you are).

>and I buy a used sewing machine so I can take sewing jobs in the evening, then I'm a capitalist and you aren't

I don't think that's true. In the traditional schema (for its faults and advantages), a capitalist is someone who both owns capital and employs wage labour. If you hired people to work on your sewing machine and kept their produce, that would likely make you a capitalist. At the end of the day, these examples don't work well to illustrate the notion of capitalism as a social phenomenon, rather than one involving two individuals who buy beer.

Re: Seven Fixes for American Capitalism

#106

Post by stcredzero »

nine_k wrote: post #99
davidivadavid wrote: post #31

Earlier quoted context omitted.

On the face of it the statement looks like one of those things that is either a tautology, or false. If society is in a state of stasis, that means no one is allowed to do things that go beyond what society is doing in the present. That means you don't have the right to innovate, to try new things, and so on, which seems integral to individual liberty. So his statement is obviously true. However, if you consider libe…

> if you consider liberty as a social construct If you consider prosperity as a social construct, you'll find out that many societies have self-reportedly achieved it, even if you would find them oppressive and dirt-poor by your own standards. BTW moving key notions from the realm of somehow reality-testable to the realm of purely denotational and conventional was the way how the Party in "1984" ruled the minds of pe…

BTW moving key notions from the realm of somehow reality-testable to the realm of purely denotational and conventional was the way how the Party in "1984" ruled the minds of people. War is peace, freedom is slavery, etc.

Also, such attacks on universal principles and the reality-testable are waged by taking the purely conventional and raising those up to the level of empirical fact and universal principle.

Re: Seven Fixes for American Capitalism

#107

Post by clavalle »

chobeat wrote: post #32
m000z0rz wrote: post #25

Earlier quoted context omitted.

Isn't that exactly what joshuaheard said, though?

No because capitalism, even on paper, will still imply poverty as a structural element. Without poverty and exploitation, the system cannot sustain itself. This without considering waste: Capitalism, being competitive at every scale, implies that to give feedback to the system, you have to waste. Waste resources, waste time, waste lives. The more waste, the better the outcome. If it works by different assumptions, it…

I cannot figure out how you came to the conclusion that poverty and exploitation are structural elements to capitalism.

In fact, I believe the opposite is true: that capitalism succeeds despite the drag that decisions made under desperate poverty (and the exploitation that comes with that) makes on the system. And, without that drag, capitalism would actually be far more successful than it already is.

Re: Seven Fixes for American Capitalism

#108

Post by merpnderp »

kadendogthing wrote: post #89
merpnderp wrote: post #72

Earlier quoted context omitted.

Is that reasonable when heath-care costs, at 20% of the economy, are increasing at 10+% a year? The economy is not growing even close to fast enough to offset this. Our productivity is not increasing even close to fast enough.

>Is that reasonable when heath-care costs, at 20% of the economy, are increasing at 10+% a year? Yes. One, because cash flow one way doesn't justify cash flow another way. Regardless of other costs. So I'm not sure how one relates to the other. Purchasing power and real wages don't necessarily mean you have more money to spend freely. It's a way of looking at how average workers are getting their slice of the pie, so…

Lol, you can't use health care and capitalism in the same sentence. The most heavily regulated and government controlled industry happens to also be the poorest ran and most corrupt? So many carveouts for the politically connected? State mandated hospital sections to limit competition? The whole industry is a horror show of the dumbest most self defeating rules imaginable, and yet capitalism takes the blame?

Re: Seven Fixes for American Capitalism

#109

Post by clavalle »

posterboy wrote: post #84
clavalle wrote: post #18

Earlier quoted context omitted.

It's like a law against harrassment...it requires human judgment. Some harassment is obvious. Some depend on perspective. Enforcing harassment laws can still be justice even though it is arbitrary and vague. Hell, if laws weren't arbitrary and vague depending on circumstance, we wouldn't need lawyers and courts!

That's just saying it's the decisions that are arbitrary, not the rules. OP implies that judgement should be not just within the limits of the law, but dictated by it. Truly, the cut off where a law's guidance ends and judgement begins is rather arbitrary. Exegesis of law is difficult. OP takes the principled stance that law exists to conserve the power of governance (totalitarian). You take the stance that judges ar…

Your analysis assumes that all monopolies are created equal -- that a monopoly on violence is the same as a monopoly on a commodity. Nothing could be further from the truth.

Re: Seven Fixes for American Capitalism

#110

Post by logfromblammo »

mindslight wrote: post #94
jiveturkey wrote: post #78

Earlier quoted context omitted.

a. isn't krugman arguing FOR inflation? b. why is low unemployment bad? let's say we have a deflationary economy, doesn't that lead to high unemployment which is a feedback to more deflation? how is that not a bad thing? excuse my naivete

> why is low unemployment bad? Low unemployment isn't inherently bad as an indicator, but attempting to force low unemployment with monetary policy is. In this context, lowering unemployment means increasing the financial pressure on workers so they accept lower wages. Meanwhile technological progress is eliminating many traditional positions, so workers end up stuck between a rock and a hard place - the screws are b…

Inflation is the Keynesian economist's tool for cutting wages without letting the wage-employees know that their wages are being cut.

Monetary inflation (and monetary deflation) benefit those closest to the monetary authority, those with information advantage, and those with pricing power at the expense of everyone else. If you know what the Fed will do, you get richer. If you can get the new money first, you get richer. If you are holding money when old money is destroyed, you get richer.

The economy works best when the growth in the money supply exactly matches the growth in economic activity. The Fed targets a positive inflation rate for several reasons, but one of them is that it makes real wages fall at a steady rate, and therefore workers become cheaper over time, encouraging hiring. If more wages were keyed to the inflation rate with automatic raises, the exercise would be pointless.

Always-inflation monetary policy means that everyone who works gets a pay cut, all the time. It's a stupid accounting trick, and it only works on paper. In practice, it means that the lowest-paid workers, with the least wage-bargaining power, are constantly slipping closer to poverty. But hey, they can always find a job that is decreasingly able to pay all their bills, right?

Low unemployment is not inherently bad. It is bad when you are screwing with the numbers just to hide bigger problems in your economy that may be contributing to a high unemployment rate.

Post reply on HN