The hidden ugliness of Capitalism

Capitalism is defined by the system in which the employer takes ownership of the product of the employee's labour. This system naturally leads to monopolies because it incentivizes them.

 

The employer doesn't take ownership of the final product because the employer has ownership the entire time.

Take a furniture shop, for example. The employer buys wood, thus becoming its owner. He then hires someone to connect the pieces of his wood together. After the pieces are connected together, the employer still owns the wood. He has taken nothing owned by the worker.

 

The monopolization of capitalistic ventures is corporatism, because it limits competitiveness. Without competition we are stifled. In a true capitalistic society, the employee would have the option of starting his own business. Then the two businesses can compete for customers, and this leads to excellence. In corporatism, very few small business are created.

 

Agreed. Government created monopolies stifle competition and concentrate wealth. Regulatory barriers to entry keep poor people poor. Neither are capitalist, but are corporatists/fascist.

 

The problem with this whole argument is that it is based on a deception that tries to turn something that is NOT property into property. In other words, Locke's logic was flawed from the very beginning. When someone plants corn in the ground, they are applying their labor to the creation of a corn crop, in no way are they trying to create more land. Their labor is applied to creating a crop of corn, thus the corn is their property, not the land that already existed, long before their labor.

No, it is forfeit to the next user, who is willing to pay compensation to society, for the advantages the privilege of exclusive use of the land confers upon him.

No, Henry George was right and John Locke was wrong. John Locke's arguments did not consider the effects the division of labor has upon land use, Henry George's did.

Everybody uses land, but the division of labor means that while some people will use the land directly, others will use the land indirectly. Imagine, two people want bread. These two people decide to work together to produce the bread they want. It is agreed that one individual will till the soil, plant and harvest the grain, while the other individual will mill the grain, mix it with other ingredients, bake and package the bread. A coin is tossed to determine which individual will do which task.

The production of the bread required the use of cropland, both the farmer and the baker equally own the resulting bread, which means that both men equally use the cropland, even though the baker never touched the cropland it directly. In other words, BOTH MEN PROVIDED AN EQUAL AMOUNT OF LABOR TO THE PRODUCTION OF THE BREAD, BUT JOHN LOCKE'S PHILOSOPY AWARDS THE FARMER AN EXTRA PROPERTY RIGHT, ABOVE THAT OF THE BAKER, BECAUSE NOW NOT ONLY DOES THE FARMER OWN HALF THE BREAD, BUT HE NOW ALSO OWNS ALL THE CROPLAND, WHICH IS STUPID. Even though both provided equal labor to the production of the bread, the farmer will have a permanent future advantage over the baker, all because of a flawed and stupid philosophy put forward by John Locke.

 

Your ideology is something you're sticking onto capitalism. Not a feature of capitalism itself.

Capitalism is the economic machine. That's it. Your ideas of how it should work are simply your ideas. And we can observe that this machine does not perform according to them.

If you run a business, it is in your interest to swallow up competition. You will do everything in your interest to ensure that you become massively powerful because you're rewarded for doing so. This naturally leads to monopolies.

Even in this time, when we have tried to reel in capitalism a bit, we have still failed.

I believe that capitalism is fundamentally broken and that it must be replaced by socialism, socialism refined by theorists who have looked at the mistakes of the past and learned from them and kept in check by the people.

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You talk about ownership like it's a physical principle, something that can be measured and analyzed.

In reality, ownership is just a description of the allocation of resources.

I happen to feel that the employer shouldn't have sole control over the resources his employees create. Instead, I feel that when multiple people collaborate to make something a reality, they should all have part control over it. Due to the interconnected nature of the economy, this naturally leads to a world where the control of the economy is in the hands of the working class, creating a democratic economy.

 

What natural monopolies exist or have existed without using the police powers of the state to eliminate competition?

So monopolies are bad, unless they are monopolies on justice, money, and all else held by central planners.

Those theorists still haven't solved the economic calculation problem. It's just more technology oriented central planning, guaranteed to create more misery and require more mass murder to prevent wrecking, diversion,and sabotage.

 

a) Pick up a history book. Look at the very existence of the gilded age. There was an entire class of laws invented to combat monopolies in the time when industry was at its least regulated in America.

I have no idea how someone could know that bit of history and think that the reason things are so bad is because of too much regulation. Suggesting otherwise is just masturbating with the invisible hand.

b) The state is a direct result of class conflict. The bourgeois class under capitalism controls and reinforces the state and uses it to push their class interests.

The reason why sole control of a capitalistic industry is bad is because the underlying philosophy of capitalism is "Up yours". It actively incentivizes being a sociopath if you have the power to do horrible things.

A workers' state, if kept in check by the people, can be utilized to advance democracy and the proletarian cause and is actively incentivized to do so by the nature of its proletarian composition.

Oh boy, the "Stalin killed bajillions with his moustache" meme rears its head again.

Despite the fact that the famines cannot be attributed to communism given that it was the communists who ensured that there was never famines in Russia or China again after centuries of constant famine.

Despite the fact that the socialist states of the 20th century were assailed on all sides and were more than justified in being paranoid of sabotage, and even so were merciful to those purged (The vast majority of people who were purged were not murdered, merely sent to prison for a short time for committing treason. The majority of those had their sentences shortened).

And I also detect ignorance of the fact that central planning kept the Soviet economy growing from its inception to the end, even when capitalist roaders had implemented disastrous capitalist ideas like competition into the command economy.

 

Corporatism is the monopolization of the economy by corporations and landowners, while capitalism is the monopolization of the economy by landowners alone. Geoism is the only economic philosophy which rejects all forms of legal (government created and enforced) privilege, which makes it the only truly competitive/free market system.

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

 

Basically Locke addresses this because the "right of property" to land is really the "right to use the land" for the purpose of growing the crop that the person owns. As Locke addresses if the person stops growing the crop then they lose the right to use the land.

The same was true for ranching. The rancher owns the cattle and a fence, if they build one to constrain the movement of the cattle, but in reality they don't actually own the land or natural resources nor should they be allowed to prevent others from using the same land so long as that person doesn't harm the cattle or the fence that are the property of the rancher. I have no idea where the belief that cattle roaming on the land established a "right of property" to use the land orginated but it sure wasn't from Locke (actually I do because it's based upon "title" established under the doctrine of the Divine Right of Kings). Cattle don't have a "right of property" and cannot establish a right to do anything.

"Compensation" actually refers to "punitive damages for the violation of the right of property of the common" (all people) and "society" is actually the "government" and not the "common" (all people) who's right of property is violated. That's a (*)(*)(*)(*)-poor argument based upon hypothetically mitigating the violations of the right of property as opposed to preventing the violation in the first place.

The division of labor that Henry George addressed was based upon the doctrine of the Divine Right of Kings which does not exist based upon the "natural/inalienable right of property" where commerce is not mandatory as established by John Locke.

People fail to understand Locke's arguments where the foundation for the natural right of property is the necessity of the individual to take from nature with their labor, that they exclusively own, that which is necessary for their "support and comfort" and in doing so they cannot limit the ability of others to also do the same by ensuring that "enough, and as good" is left for the "common" (all other people). This is an argument for the "generalist" because the person must have numerous skills and labor at many different tasks to provide for their own support and comfort.

Locke goes on to argue for specialization where the person focuses on one fundamental task (e.g. growing corn) and then engages in commerce with other specialists so that combined all of the specialists will be able to provide for their support and will enjoy more comfort because the specialists, combined, can produce more of everything per capita than the generalists. Commerce increases the ability of the "common" to provide for their individual "support and comfort" but because of our property laws based upon the doctrine of the Divine Right of Kings there's an unfair distribution of the "wealth" being created by the specialists because those actually providing the labor do not have their basic "support and comfort" guaranteed under our laws.

Locke, I believe, would be advocating for minimum compensation for labor to ensure the basic "support and comfort" for all that are forced to engage in commerce today. Locke believed that the "common" should benefit from commerce but that isn't happening today because many employers are allowed to take "too much" from the workers labor under our laws.

Under Locke's arguments both would share from the production of the grain and both would share from the bread produced that would be traded to others for what they produce so that all have their support and comfort provided for. Neither would have a "permanent future" because if the farmer stopped producing the grain then the farmer would lose the right to use the land. Only under the doctrine of the Divine Right of Kings does the farmer retain "title" to the land (which is granted by government) if they stop using it.

 

From the same source:

"A land value tax is often said to have progressive tax effects, in that it is paid primarily by the wealthy (the landowners), and it cannot be passed on to tenants, workers, or users of land."

This is absolutel nonsense. I was a landlord that paid property taxes on the commercial building I owned and the taxes were pro-rated as a component of the rent I charged to my tenants. To claim that the tax is not passed on to the tenants, workers, or users of the land is a blatant lie.

I wasn't even wealthy because the bank basically owned the property and I was paying the mortgage that included (mostly) interest and that was also passed on to the tenants that rented from me. In the end, due to the real estate market collapse, I was eventually forced to sell below the purchase price and actually lost about $45,000 in principle that I'd paid to the mortgage company (that my tenants paid through their rent). The only one that made out financially was the mortgage company in the end and they did so because of the rent I collected from my tenants.

 

Monopoly only exists based upon the doctrine of the Divine Right of Kings and does not exist based upon the "natural right of property" as addressed by John Locke. A monopoly cannot exist so long as there is "enough, and as good" left for the common (all people) which is a caveat to the natural right of property that's ignored by those like Henry George and Adam Smith.

 

Yes, but the improvement to those properties had real value, value which the owner could cash out when selling.

You have removed the ability to invest in real property, so again, why would anybody maintain or improve property?

 

No, land value taxes cannot be passed to tenants, they come out of the landowners profits. The article from wikipedia is correct that land taxes cannot be passed to anyone else. Land value taxes produce only good/desirable economic outcomes (negative dead-weight losses), and this is one of those outcomes – the fact that land value taxes cannot be passed to tenants, workers or land users, results in a collapse of land prices, making purchasing land more affordable to a wider spectrum of citizens.

Your argument that land value taxes ARE passed to tenants, even though it be wrong, is a very common mistake. When people buy land they know the taxes cannot be passed to tenants, so they discount the taxes out of what they are willing to pay the seller (the current owner). The higher the land taxes are levied, the less they will offer in exchange for the land title. If the land taxes are high enough they won't offer the seller (current owner) anything at all, but provided the land taxes are levied JUST high enough to bring land prices to zero ($0), but not higher then that amount, then land users will still put the land into production, same as if the tax didn't exist. Because land taxes reduce land purchase prices, the cost of the tax is offset by those lower prices, making it a cost that does not need to be recouped by potential new owners.

You would have benefited from land value taxation. You would have paid less for the land under the mini-mall, reducing your initial costs related to the land, you would have paid the real estate broker less, and your mortgage and interest would have cost less. It is very likely, that, by reducing all of these other costs, land value taxation would have prevented your mishap.

 

You HAVE to stop using your John Locke argument against the geoist (land value tax) system. It does not work. John Locke himself believed that all taxes should by paid by landowners, same as I am advocating. I'll tell you what, if you can find me a quote (in context), by John Locke, of him advocating any other form of taxation, other than taxes on land, then I will listen to your argument.

Good luck with that.

 

http://www.constitution.org/jl/2ndtr11.txt

John Locke does not specify the manner or foundation for the tax (e.g. land, income, sales, etc.) but instead establishes that the tax imposed is based upon the consent of a majority of the people (or by their representatives) and does not require unanimous consent to the tax imposed. I have no idea where the belief comes from that Locke only advocated taxes on land because the "estate" mentioned could be comprised of many things and be totally absent of any form of land ownership. There are arguably multi-millionaires that rent and don't own any land that would be taxed. He also establishes that the tax should be "proportionate" where those with more would pay a larger share of their wealth in taxes while those with no wealth would have no tax obligation at all.

Of note the person who's natural right of property is violated is not enjoying the "protection" of government and would owe nothing to support it.

 

Yes he does.

Taken from your own source:

“It is true, governments cannot be supported without great charge, and it is fit every one who enjoys his share of the protection, should pay out of his estate his proportion for the maintenance of it.” – John Locke

During the time that John Locke was alive, the word “estate” had but one meaning, and that meaning was LAND.

Here is another etymology dictionary which says basically the same thing: http://www.etymonline.com/index.php?term=estate

John Locke was dead for nearly 200 years before the word "estate" started including things other than land.

It is time for you to admit that I am right and you are wrong.

John Locke supported land taxes as the basis of taxation just like I do; just like Adam Smith did; just like the founding fathers did; just like Henry George did; just like Milton Friedman did; just like the best free market economists of today do. So, stop believing in lies.

Don't feel bad, you learned something today … nothing wrong with that.

Here is something worth reading: Progress and Poverty, By Henry George

 

You're really grasping at straws and being deceptful by pulling out of context in your definition of estate because also included in the definition is:

So yes, the word "estate" could be a reference to land in the 14th Century but it also referred to the prosperity and possessions of the person as well.

The second link establishes that the "estate" refers to the "collective assets" of the person which includes more than just land.

Even if we used the word "estate" to only mean land then the payment of taxes would have to be in the form of land (i.e. from the estate that is land) but how does the owner of land transfer a portion of the land to the government (e.g. a 1% tax on the land would result in the owner of 100 acres owing the government one acre of land) and how would that land fund the expenditures of government that aren't paid for with land?

We can even go further because in Locke's arguments for property rights related to land the only "right" the person can establish is the "right of use of the land" through their labor that must be maintained. If the person acquires a right to the use by their labor in using the land and if/when they stop using the land then they lose possession of it under Locke's arguments. So the person can own the house that sits upon the land (so long as they use the house) and/or that which the land produces such as crops or cattle but they don't actually own the land. Effectively the tax would be levied upon something the person doesn't actually own but merely has a right to use and the tax couldn't be paid for from the "estate" that would only be land and not that which the land produces where the person would have ownerships based upont their natural right of property established by their labor.

Ultimately the land itself has zero value because only what the land is used for has value and the person doesn't own the land but merely has the right to use the land for productive purposes and loses that right to use the land if they don't use it for productive purposes.

The arguments appear to be based upon propaganda where half-turths and not the full truth are used for the foundation and the weight of the full truth crumbles the foundation.

 

A short post-script to this.

In the 14th Century all land belonged to the nobility which was granted by "title" from the monarch. The titled nobility were granted title to the land, natural resources, as well as the people and all they produced. It was opposition to the establishment of "ownership established by statutory title" under the doctrine of the Divine Right of Kings that Locke addressed in his arguments for the natural right of property.

When the United States was founded we adopted many of the principles of the "natural rights of the person" such as a representative form of government but the one thing that wasn't addressed was "statutory ownership established by title" that was a hold-over from the doctrine of the Divine Right of Kings. Our laws of property today remain based upon the pre-Revolutionary War "common law" of England established under the doctrine of the Divine Right of Kings as no attempt was made to change from "title granted by government" (directly or indirectly) to ownership established by the "labor of the person" which is a natural right.

 

Only the worker can utilize his own time and effort. The employer has no way to mechanically control the body of the worker.

I don't think so.

The worker owns his body. And he can choose to use his body however he wishes at any point in time.

If someone agrees to compensate him for performing a service, sure.

Yes, he should recieve the amount that he and his employer agreed to.

I can't see any circumstance in which a person would give something he values more in exchange for something he values less. It would seem nearly axiomatic that a person would exchange something he values less to get something he values more. Thus, the exchange makes him better off than without the exchange.

 

You have trespassed upon my property, and if you prevented me from accessing my own property, then you have certainly made me worse off. But, if after you leave, everything is exactly as it was before, I can't say that you've stolen any of my property. I could only say that you trespassed upon my property.