Except I didn't assume that was the only solution, I said it is a possible solution.
You presented a dichotomy for which you claimed either in its purest form is inescapably at fault, and questioned the overwhelming support for one or the other in contrast to middle ground. Where were you suggesting that middle ground was just a "possible" solution?
I also suggested mixing and coming up with something new
I know.
awfully selective reading you have there.
I read what's in front of me.
If I were to say: "Because it is not either of them the answer must lay in the middle" You would be justified in saying that,
That is essentially the nature of your argument. Here let's reexamine:
Why do people continuously insist: "Either Capitalism or Socialism", clearly both economic systems have their faults. Why is it that in other regards can we see that there are middle grounds, third options, etcetera, but in this specific field I've overwhelmingly seen support in one or the other way. I think that the faults of either are inescapable in their purest forms.
There are no third options, or etcetera. Capitalism is diametrically opposed to socialism. And your suggestion of "purest form" would indicate their functions at their extremities. Even if you were to suggest mixing both, that is middle ground because you're negating their extremities and functions for a compromise. This is not like, for example, political ideologies where one can claim a third option to being either Democrat or Republican in the form of Libertarian. Either the economic system facilitates the production and dissemination of goods services being regulated by private individuals or entities or not. If it's the former, it's Capitalism; if it's the latter, it's Socialism.
A) The fact that we already kind of do that,
Yes, we do. Except this middle ground is a farce. It's socialism--or to be more technical, it's communism.
B) That isn't what I said, your fallacy is an example of the fallacy fallacy.
Then what did you state? Or what did you intend to state?
Capitalism
I could list them out, but I think this source does it much better than I could explain it currently: (
GEH)
Okay, let's go these supposed faults:
1. Inequality
The benefits of capitalism are rarely equitably distributed. Wealth tends to accrue to a small % of the population. This means that demand for luxury goods is often limited to a small % of the workforce. The nature of capitalism can cause this inequality to keep increasing. This occurs for a few reasons
- Inherited wealth. Capitalists can pass on their assets to their children. Therefore, capitalism doesn’t cause equality of opportunity, but those born in privilege are much more likely to do well because of better education, upbringing and inherited wealth.
- Interest from assets. If capitalists are able to purchase assets – bonds, house prices, shares, they gain interest, rent and dividends. They can use these proceeds to buy more assets and wealth – creating a wealth multiplier effect. Those without wealth get left behind and may see house prices rise faster than inflation.
- The economist Thomas Piketty wrote an influential book Capital in the Twenty-First Century, which emphasised this element of capitalism to increase inequality. As a general rule, Picketty argues wealth grows faster than economic output. He uses expression r > g (where r is the rate of return to wealth and g is the economic growth rate.)
First, "inequality" is not a fault. Inequality is inevitable among a population of varying skills and talents, let alone subjective values. If I did not make as much as a currency trader for example, the system would not have faulted me. Rich and poor are relative concepts; therefore, in order to be "rich" there would necessarily need to be one who's "poor" or at the very least, "poorer." The premise of this argument is that it's "faulty" to not have wealth.
Capitalism relies on financial markets – shares, bonds and money markets but financial markets have a tendency to cause booms and busts. In a boom period, lending and confidence rise, but frequently markets get carried away by ‘
irrational exuberance‘ causing assets to the spike in value. But, this boom can quickly turn to a crash when market sentiment changes. These market crashes can cause economic downturns, recession and unemployment. At various times, capitalism has suffered prolonged recessions (the 1930s), periods of mass unemployment and a decline in living standards.
Capitalism does not "rely" on financial markets. It relies on commerce generated by private entities. The booms and busts of the securities market, which is referenced in this quotation, is a consequence of the credit cycle regulated and sanctioned by the government and its affiliates. That has nothing to do with Capitalism in and of itself.
In a free market, successful firms can gain
monopoly power. This enables them to charge higher prices to consumers. Supporters of capitalism argue only capitalism enables economic freedom. But, the freedom of a monopoly can be abused and consumers lose out because they have no choice. For example, in industries like tap water or electricity supply, which are a natural monopoly, consumers have no alternative but to pay the prices charged by consumers. In the Nineteenth Century, monopolies like
Standard Oil bought our rivals (often with unfair competitive practices) and then became very profitable.
No, firms don't gain monopoly power in Capitalism. Even the case against Standard Oil was a farce. Standard Oil before its dissolution had over 150 competitors. How was it a monopoly? The only monopolies are state-sanctioned monopolies which take form in patents, copyrights, and trademarks--and lythoronine tablets, the subject of this reference's case for "monopoly" has a U.S. patent.
Monopsony is market power in employing factors of production. For example, firms can have monopsony power in employing workers and paying lower wages. This enables firms to be more profitable but can mean workers don’t share from the same level of proceeds as the owners of capital. It explains why with increasing monopsony power we have seen periods of stagnant real wage growth while firms profitability has increased (2007-17 in UK and US)
No it's not. Whoever wrote this knows little about the subject. A monopsony is a single buyer controlling a market, very much in the same way that a "monopoly" is a single seller doing the same. Even when applying the concept of monopsony to the labor market, his description would be inept.
In a free market, factors of production are supposed to be able to easily move from an unprofitable sector to a new profitable industry. However, in practice, this is much more difficult. E.g. a farmworker who is made unemployed cannot just fly off to a big city and find a new job. He has geographical ties to his birthplace; he may not have the right skills for the job. Therefore, in capitalist societies, we often see long periods of structural unemployment.
Once again, not a fault of capitalism in and of itself. Structural unemployment usually occurs in often revolutionary shifts in the focus of generated commerce, i.e. primary sector (raw materials,) secondary sector (manufacturing,) and tertiary sector (intangible goods.) This is in fact necessary. The computer from which you type and likely generate some income is a result from monumental shifts in skills.
In capitalist economies, there is limited government intervention and reliance on free markets. However, market forces ignore external costs and external benefits. Therefore, we may get over-production and over-consumption of goods that cause harmful effects to third parties. This can lead to serious economic costs – pollution, global warming, acid rain, loss of rare species; external costs that damage future generations.
Where's the substantiation of this argument?
The nature of capitalism is to reward profit. The capitalist system can create incentives for managers to pursue profit over decisions which would maximise social welfare. For example, firms are using theories of price discrimination to charge higher prices to consumers who want to jump the queue. This makes sense from the perspective of maximising profit. However, if we have a society, where the rich can pay to jump a queue at a Fairground – or pay to see Congressman quicker – it erodes social norms and a sense of ‘fair-play’
The pursuit of the profit motive has encouraged some law firms to aggressively pursue litigation claims. This has created a society where we devote resources to protecting ourselves from being sued. Further reading – “
Moral Limits of Markets” by Michael Sanders
Once again, none of these arguments are substantiated in the slightest. It merely presumes that Capitalism is detrimental to "social welfare" and "fair-play."
Theweakeredge, you can provide better arguments for the alleged faults of Capitalism. This itemized list is thoughtless and lacks an appreciation for economic analysis.
