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The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:12 pm
by Ditocoaf
The concept of the market regulating itself is quite an ingenious one, and it often works: people, working towards their best interest in the form of profit, will do what's best for others in exchange for better business. I, as a customer, am more likely to buy a quality product from a responsible company; therefore the company will will act responsibly to earn my business (or at the very least, try to look responsible). People with more knowledge of economics than I will tell you how this specifies into more individual-based sense, and expands into a more general, national sense.


But all of economic conservatism goes off something else as well: the assumption that money is something we earn. Someone with a lot of money deserves it, because they earned it. That's why it's fundamentally wrong to share benefits equally. That's why we shouldn't take money from the rich and use it to help others.
Unfortunately, this assumption is incorrect.

The reason capitalism is flawed is because we're able to inherit our parent's money, thereby achieving wealth we didn't earn. Either the law should be changed so that a person's wealth disappears when they die (it actually goes back to the government), or since children inherit wealth, they should also inherit parents' debt, crimes, etc as well.

Right now, a new person randomly inherits their social status from someone random (your parents could be rich or poor, and you had no effect on that). If we simply shift our application of "inheritance" slightly, something else will make more sense: we all inherit our wealth from everyone who came before us. Family ties are still an important construct, don't get me wrong. But they fragment our society into millions of smaller societies, all fighting against eachother. If we simply view the entire country as fundamentally our family, individual inheritance becomes rather silly... and this is how we should view things, from a policy perspective. If you truly believe in the ability of the best to earn their way to the top on their own merits, then everyone should start out equal. According to capitalistic theory, Bill Gates would have been successful if he had been born in a ghetto, right? Well, with shared inheritance, everyone would begin their lives with a moderate, if not especially helpful, amount of wealth--better than many do today.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:40 pm
by Matroshka
When did peoples lives become a competition for the government to make fair?

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:42 pm
by InkL0sed
When don't they?

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:45 pm
by Mr Scorpio
I guess you shouldnt give people gifts either since they didnt earn it :roll:

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:46 pm
by Ditocoaf
Matroshka wrote:When did peoples lives become a competition for the government to make fair?

All I'm saying is that if you're claiming that wealth is deserved, you're wrong -- most people don't deserve what they have. And if you want the "free market" system to work, then most wealth should be deserved. I'm also offering up the logical way to fix this problem.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:47 pm
by targetman377
life is not always fair get over it. ok if you earn it you have the right to do what you want with it right. i think you would agree with that if they so choose to give it to there kids.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:49 pm
by targetman377
Ditocoaf wrote:
Matroshka wrote:When did peoples lives become a competition for the government to make fair?

All I'm saying is that if you're claiming that wealth is deserved, you're wrong -- most people don't deserve what they have. And if you want the "free market" system to work, then most wealth should be deserved. I'm also offering up the logical way to fix this problem.


so if this is a logical fix. how did the government earn my money? well how they did nothing.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:50 pm
by Matroshka
I guess the key word there was competition. Why does it matter that you and I start our lives with the same amount of money? Sure, if someone starts with more money than another person, they may have it a bit easier. But why does that matter so much? I used to get jealous if one of my brothers got more M&M's than me, but my mom always told me to worry about myself.

So who cares how many M&M's someone else has, go out and get your own. Life's not a competition with anyone else but yourself.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:50 pm
by mccallan25
As someone who built all of their wealth from the ground up I am excited that when the day comes and I die that my kids will have it easier then I did. The "death tax" needs to be gotten rid of. Of course whatever debt (if any) I have the estate has to pay off first before the distribution of wealth does occur.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:52 pm
by targetman377
mccallan25 wrote:As someone who built all of their wealth from the ground up I am excited that when the day comes and I die that my kids will have it easier then I did. The "death tax" needs to be gotten rid of. Of course whatever debt (if any) I have the estate has to pay off first before the distribution of wealth does occur.



aman spoken words of wisdom =D> =D> =D>

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:52 pm
by InkL0sed
I thought all men were created equal? If we weren't such hypocrites, we'd give everyone equal wealth as well.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:55 pm
by Ditocoaf
targetman377 wrote:How did the government earn my money? well how they did nothing.

Understand, the government is supposed to be all of us. The people working for government are simply our employees, to manage things and protect us. We give them money to do stuff for us, that we need done.
Matroshka wrote:I guess the key word there was competition. Why does it matter that you and I start our lives with the same amount of money? Sure, if someone starts with more money than another person, they may have it a bit easier. But why does that matter so much? I used to get jealous if one of my brothers got more M&M's than me, but my mom always told me to worry about myself.

So who cares how many M&M's someone else has, go out and get your own. Life's not a competition with anyone else but yourself.

So you're really claiming that Bill Gates would have been as successful if he had been born in a ghetto? Really, I think a lot of genius is being wasted by people who are just trying to survive, because they're born to a really poor family.

mccallan25 wrote:As someone who built all of their wealth from the ground up I am excited that when the day comes and I die that my kids will have it easier then I did. The "death tax" needs to be gotten rid of. Of course whatever debt (if any) I have the estate has to pay off first before the distribution of wealth does occur.

You built all of your wealth from the ground up... did you go to school as a child? Some people can't even go to school, because they need to feed themselves.
What did your children do to deserve to work less hard than you?
InkL0sed wrote:I thought all men were created equal? If we weren't such hypocrites, we'd give everyone equal wealth as well.

Exactly. In this country, we're not created equal... some people are born wealthy, and never have to work a day in their lives for an excess of luxury.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 3:57 pm
by Neoteny
Like they understand you in the back of the jet
When you can't put gas in your tank
These fuckers are laughing their way to the bank and cashing the cheque
Asking you to have compassion and have some respect
For a leader so nervous in an obvious way
Stuttering and mumbling for nightly news to replay
And the rest of the world watching at the end of the day
In their living room laughing like "what did he say?"

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 4:01 pm
by Matroshka
Ditocoaf wrote:So you're really claiming that Bill Gates would have been as successful if he had been born in a ghetto? Really, I think a lot of genius is being wasted by people who are just trying to survive, because they're born to a really poor family.


Did you read what I said? Why does it matter if he inherited more money, a bigger home, more caring parents, or whatever? Is someone else more entitled to his success?

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 4:04 pm
by Ditocoaf
Matroshka wrote:
Ditocoaf wrote:So you're really claiming that Bill Gates would have been as successful if he had been born in a ghetto? Really, I think a lot of genius is being wasted by people who are just trying to survive, because they're born to a really poor family.


Did you read what I said? Why does it matter if he inherited more money, a bigger home, more caring parents, or whatever? Is someone else more entitled to his success?

If Bill Gates had been born in a ghetto, who knows how much slower the advance of technology would have been. Random chance could have hurt the progress of humanity manyfold... and it does all the time. Right now there could be a genius starving on the streets, who if they only had enough money to eat while they earned a high school education, could get a scholarship to a nice college and eventually fix all our energy problems.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 4:05 pm
by Skittles!
The impossibility of discussing whether a system is fair or not is that everybody discussing it inevitably has a place within it.

Put another way, if we all had to invent a system to live in before we knew whether we'd be born into it rich or poor, then everybody here would probably be a whole lot more lenient on the subject of welfare. After all, if you thought that you might be born into poverty and be financially barred from a college education would you really be so keen to protect what the inherited wealth of others? Would you even be so keen to protect the wealth those people earned off the back of their generously funded college educations? Probably not. You'd suddenly see the sense in giving the poor better education, about why it was important to provide healthcare for them rather than just telling them to work harder. If you were suddenly facing the possibility of being born into poverty with few prospects beyond crime or factory-work, then suddenly all this rhetoric about 'deserving' and 'hard work' would sound rather hollow. After all, you're going to slave your guts out on that production line haven't you? Why is the man who bought the factory with his father's wealth reaping all the profit?

Anyway, no doubt this will be met with howls of "if you work hard money will magically appear for you!!!1" and "I earned everything and I started life living in a cardboard box!!!1"; but that's only because you're all happy with your current situations and just wish you could stockpile yet more wealth. If you were ever faced with the genuine prospect of actual poverty and hardship then you'd suddenly be a lot more receptive to the point Ditocoaf is making, and a lot less tied up with these fallacious stock-lines about how anything is possible for anyone if they just work harder... because as any sweatshop working in the world will tell you, that's bullshit.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 4:14 pm
by Matroshka
Ditocoaf wrote:
Matroshka wrote:
Ditocoaf wrote:So you're really claiming that Bill Gates would have been as successful if he had been born in a ghetto? Really, I think a lot of genius is being wasted by people who are just trying to survive, because they're born to a really poor family.


Did you read what I said? Why does it matter if he inherited more money, a bigger home, more caring parents, or whatever? Is someone else more entitled to his success?

If Bill Gates had been born in a ghetto, who knows how much slower the advance of technology would have been. Random chance could have hurt the progress of humanity manyfold... and it does all the time. Right now there could be a genius starving on the streets, who if they only had enough money to eat while they earned a high school education, could get a scholarship to a nice college and eventually fix all our energy problems.


You make it sound like people lives are like leaves in the wind, just blowing where ever the wind takes them.

A genius would not be starving on the streets if he didn't want to be. Most people are only in the situations they are because the want to be. They may not consciously be thinking that, but they are the only ones that have the power to change the situations. I know that sounds wrong, but when there is a will there is a way.

I saw a documentary, I forget the name, about a these people hiding a suitcase of money in a dumpster. They wanted to see what a homeless person would do if they were to find a million dollars. The guy started off with big dreams, he bought a bike, then a car, then an apartment. But he eventually ran out of the money. He never got a job and all he did was drink and smoke it all away.

That guy wanted to be homeless.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 4:20 pm
by Ditocoaf
Matroshka wrote:
Ditocoaf wrote:
Matroshka wrote:
Ditocoaf wrote:So you're really claiming that Bill Gates would have been as successful if he had been born in a ghetto? Really, I think a lot of genius is being wasted by people who are just trying to survive, because they're born to a really poor family.


Did you read what I said? Why does it matter if he inherited more money, a bigger home, more caring parents, or whatever? Is someone else more entitled to his success?

If Bill Gates had been born in a ghetto, who knows how much slower the advance of technology would have been. Random chance could have hurt the progress of humanity manyfold... and it does all the time. Right now there could be a genius starving on the streets, who if they only had enough money to eat while they earned a high school education, could get a scholarship to a nice college and eventually fix all our energy problems.


You make it sound like people lives are like leaves in the wind, just blowing where ever the wind takes them.

A genius would not be starving on the streets if he didn't want to be. Most people are only in the situations they are because the want to be. They may not consciously be thinking that, but they are the only ones that have the power to change the situations. I know that sounds wrong, but when there is a will there is a way.

So you really believe that there is no such thing as a situation that you cannot work your way out of? You really believe poor people are just lazy?
Matroshka wrote:I saw a documentary, I forget the name, about a these people hiding a suitcase of money in a dumpster. They wanted to see what a homeless person would do if they were to find a million dollars. The guy started off with big dreams, he bought a bike, then a car, then an apartment. But he eventually ran out of the money. He never got a job and all he did was drink and smoke it all away.

That guy wanted to be homeless.

Sorry, but this basically boils down to "this one guy, this one time, acted like I said all homeless people would." Anecdotal evidence is never valid. You should know this. There are many more stories of people born into wealth, who never work a day in their life, and still are well off and happy. And there are far, far more stories of people who work very, very hard to succeed, and yet are still stuck living in horrible conditions.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 4:29 pm
by Snorri1234
Matroshka wrote:A genius would not be starving on the streets if he didn't want to be.


I love this line of reasoning. I will be back shortly to rip it to shreds. First order is getting another beer.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 4:29 pm
by Matroshka
That was an example and isn't the origin of my thoughts on this, it just reinforces them.

I know all situations aren't the same. I'm sure some people are really stuck in crappy situations that seem impossible to solve. And I'm sure when someone is in the crap like that, they feel desperate and helpless.

Oh, and I will patiently be waiting for the shredding ;)

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 5:35 pm
by Haggis_McMutton
While i also think poverty is a major issue for not only the free market but also our progress as a species, i have doubts about this proposed solution.

Most important, this would impose serious limitations on the way i can spend my hard earned money. After all, if it`s my money, and i earned it, how do you justify the government stepping in and saying "you can`t give this to whom you want."? Also, would gifts be regulated too? So, I can`t buy my son a sports car, cause he didn`t work for it?
So would we abolish gifts entirely? Or have a chart with accepted values for gifts so that no one gets left behind? :lol: It just can`t work.

It would be nice to actually "be born equal", but i don`t see how that could be achieved without getting into transhumanism and such. What we should realistically aim for is to drag the poorest families to a comfortable level, a level where they don`t have to worry about what to eat the next day.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 5:56 pm
by spurgistan
I'd say the fundamental flaw of modern capitalism is that it assumes that consumers make their choices with perfect or near-perfect information, when in fact that is not close to the case. No matter how well informed you may consider yourself, the modern economy is simply too disassociated for people to know what everything really costs the provider to produce, what the environmental / social costs are, and whether there are better choices unbeknown to the consumer. Advertising ftl.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 5:58 pm
by hecter
Exactly why we need to spread the wealth; more social services, welfare, ect. ect. I'm an aspiring computer something-or-other. It's math, it's what I enjoy, it's what I'm good at. I'm not really good at anything else, I suck at languages, always have, and I suck at sports, always have. I'll never be very good at those things, no matter how hard I try. It's just not in me. But I'm lucky. I have a computer and money to upgrade it and school has given me the skills to program it. With the help of the internet, which I am fortunate to have, I can do all sorts of things. Let's put me in a different scenario.

I'm born to an abusive and alcoholic father and drug addicted mother. I have nothing, as all money goes to booze and drugs. I have enough food to not starve, and a roof over my head. So what am I to do? Let's say my dad gets arrested at some point, not an uncommon occurrence. So now I'm left with my mother to take care of me. I go to school, but it gets harder and harder. My mom doesn't care if I go, and they force me to learn French which I hate and I'll never be good at (really, I won't. I'm French, with a French family who I see relatively frequently and took what's called French immersion for 8 years and I can barely speak a word of it) so why should I go? So, I don't. Now what do I do? I'll probably end up working dead end jobs for the rest of my life, get involved in illegal activity and other things that happen every day in the ghetto's.

To every one of you who say "Well, if people really care, they can get themselves out of bad situations." I tell you, put yourself in a situation like that. And I mean really put yourself in it. Spend a few days thinking long and hard about it, play through scenarios in your head, remember what it was like when you were a kid and think about what you would have done then as you would have done it differently than you would now, remember, and see if you can still say that afterwards. If you can, then you're either incredibly unique or a liar.

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 6:08 pm
by black elk speaks
Ditocoaf wrote:
The concept of the market regulating itself is quite an ingenious one, and it often works: people, working towards their best interest in the form of profit, will do what's best for others in exchange for better business. I, as a customer, am more likely to buy a quality product from a responsible company; therefore the company will will act responsibly to earn my business (or at the very least, try to look responsible). People with more knowledge of economics than I will tell you how this specifies into more individual-based sense, and expands into a more general, national sense.


But all of economic conservatism goes off something else as well: the assumption that money is something we earn. Someone with a lot of money deserves it, because they earned it. That's why it's fundamentally wrong to share benefits equally. That's why we shouldn't take money from the rich and use it to help others.
Unfortunately, this assumption is incorrect.

The reason capitalism is flawed is because we're able to inherit our parent's money, thereby achieving wealth we didn't earn. Either the law should be changed so that a person's wealth disappears when they die (it actually goes back to the government), or since children inherit wealth, they should also inherit parents' debt, crimes, etc as well.

Right now, a new person randomly inherits their social status from someone random (your parents could be rich or poor, and you had no effect on that). If we simply shift our application of "inheritance" slightly, something else will make more sense: we all inherit our wealth from everyone who came before us. Family ties are still an important construct, don't get me wrong. But they fragment our society into millions of smaller societies, all fighting against eachother. If we simply view the entire country as fundamentally our family, individual inheritance becomes rather silly... and this is how we should view things, from a policy perspective. If you truly believe in the ability of the best to earn their way to the top on their own merits, then everyone should start out equal. According to capitalistic theory, Bill Gates would have been successful if he had been born in a ghetto, right? Well, with shared inheritance, everyone would begin their lives with a moderate, if not especially helpful, amount of wealth--better than many do today.


That's just hogwash. If I start a business and employ people, then have a child who works to learn the business and is capable to run the business at the time of my death, then that child should get the inheritance of that business. If that child fails at it, then the market will redistribute the wealth of his parent's legacy by loosing it to his competitors. Bear in mind also that people / companies that have a business model that fails to evolve with the time will fail as well. Take the paper industry for example. less and less paper is used as things become more and more digital. Likewise, our country's foolish approach to corporate welfare for our auto manufacturers only prolongs the inevitable fact that the big three are going to tank. It should fall on the direction of the younger generations of the wealthy to master the management of large inheritances to fund advancements in science and technologies. this must be done without the idiocy of big government stifling the ingenuity of savvy individuals.

Your suggestion that when I die, all my money should be absorbed like the end of a Monopoly(r) (sorry Hasbro) game is most foolish because the vast vast majority of people that you are proposing to give that money to would squander it on nothing profound.

Your communist approach to things has failed in society after society throughout history. Why do you think it will do anything else here in AmeriKa?

Re: The fundamental flaw in capitalism

Posted: Fri Nov 07, 2008 6:24 pm
by black elk speaks
hecter wrote:To every one of you who say "Well, if people really care, they can get themselves out of bad situations." I tell you, put yourself in a situation like that. And I mean really put yourself in it. Spend a few days thinking long and hard about it, play through scenarios in your head, remember what it was like when you were a kid and think about what you would have done then as you would have done it differently than you would now, remember, and see if you can still say that afterwards. If you can, then you're either incredibly unique or a liar.


I was raised on welfare in a family where my father didn't want to work. There were times when all we had was fucking cheese sandwiches. We had nothing, but my dad sure did like to bet on horses. Thats right America. My father bet your tax dollar handout and lost almost every day.

He did exactly what he wanted, but unfortunately, that never amounted to him putting a resume together and getting a job. He smoked expensive cigars while getting that government check. All the while, we panhandled to the government for a handout.

In my heart, I knew that it was bull shit and i wish we didn't have welfare so that my loser father would have had to actually work at something to make a living. I left home and never looked back.

I have no problem with people getting help when and where needed, but the government is not the place where that needs to come from. They have not the right to do it nor are they burdened with the responsibility.