“People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” -- Adam Smith
Blame Cronyism, Not Capitalism
51–60 of 261 posts
Re: Blame Cronyism, Not Capitalism
#52Capitalism describes Capitalism doesn't prescribe We should praise Capitalism for describing humanity better than other *ism
That's like saying that the rules of chess describe instead of prescribing. Perhaps it doesn't say anywhere that you should play chess. But neither does it suggest that the rules of chess "describe human play better than the rules of any other game."
Capitalism describes a system where ownership over all capital is marketized. A society can adhere to that system or not. Under Feudalism, for example, land ownership is instead attached to hereditary titles. You can argue that Capitalism is the best economic system for a society, but it is hardly the only one. In fact, compared to the millenia for which Feudalism lasted, Capitalism is very, very recent.
Re: Blame Cronyism, Not Capitalism
#53Capitalism without fair competition is not capitalism. There needs to be rules and regulation to have a level field. Huge barriers to entry, monopoly, oligarchy and so on all pervert capitalism. Currently, it's far far away from a good place.
Re: Blame Cronyism, Not Capitalism
#54Two things can be bad.
Re: Blame Cronyism, Not Capitalism
#55Re: Blame Cronyism, Not Capitalism
#56[flagged]
Each time the incumbent A snuffs out such a competitor, they have to give away a lot of cash.
While financing this might become profitable after the competitor goes bankrupt and A raises prices again, there is a continuous stream of competitors trying to profit, which might erode A's capital to a point where it's not worth dumping.
There is also the risk of a bankrupt competitor open-sourcing their product out of either spite or benevolence, significantly and permanently demonetizing the product in question, damaging A (the dumper's) finances.
And yet another risk is the competitor not going bankrupt, but merely scaling down while A is done with its dumping.
Re: Blame Cronyism, Not Capitalism
#57Why not blame both?
did you read it?
Re: Blame Cronyism, Not Capitalism
#58Not a shocker that corruption ruins things. I guess then the question is how you can design a broadly distributed system that removes the incentives for corruption and minimizes its impact. My guess is that such a system won't be found in capitalism
capitalism seems like a more likely home for broadly distributed systems than government systems which are, by their nature, centralized
Re: Blame Cronyism, Not Capitalism
#59[flagged]
What you're describing here is not capitalism but rather a single unwanted scenario that can come from it, specifically when there are too few producers in a category or, in your example, when there is only one.
Yes, it also ignores that price is only one of many factors in the market - doesn't matter to some consumers how cheap your widget is if my widget has new tech/features not found in your widget and consumers need those features. So company A in the example could drop prices and still not be able to compete with the superior product from company B. Happens all the time in the real world.
Re: Blame Cronyism, Not Capitalism
#60"...that some government interventions to address the apparent shortcomings of capitalism invite cronyism"
LOL, so yet again, govermint is the problem!
It should be increasingly clear by now that capitalism itself is the problem. It naturally leads to the rich getting richer, and despoils everything in the name of profit, unless it is reigned in by government, taming it for the benefit of society, not just profit and growth. Cronyism is a symptom of too much private power.