Not quite. Atheists and theists do not agree on the existence of God. However, we both agree that economic activity would not cease without capitalism. I was simply asking what form you would like to see that economic activity take. Which you answer in the next sentence:
DoDo: Of course, I would still wish the economic system to take a specific form, a green-socialist one.
Would such a green-socialist system be based on a price-profit mechanism in which the factors of production were organized (e.g. by worker-owned corporations, cooperatives, entrepreneurs, state-owned businesses, etc.) to obtain a surplus (or profit) from society in return for the goods produced by this organization? The march of civilizations is a series of defenses that man has put up against the dread of pure existence.
It is probably necessary to distinguish profit from surplus. En un viejo país ineficiente, algo así como España entre dos guerras civiles, poseer una casa y poca hacienda y memoria ninguna. -- Gil de Biedma
Would such a green-socialist system be based on a price-profit mechanism in which the factors of production were organized (e.g. by worker-owned corporations, cooperatives, entrepreneurs, state-owned businesses, etc.) to obtain more from society in return for the goods produced and services provided by this organization than it cost to produce and provide these goods and services? The march of civilizations is a series of defenses that man has put up against the dread of pure existence.
Specifically, does "cost" include labour cost?
- Jake If you only spend 20 minutes of the rest of your life on economics, go spend them here.
Yes. The march of civilizations is a series of defenses that man has put up against the dread of pure existence.
Maybe in some cases. But I guess in most cases profit depends on labor as well as capital, so "return on capital" would be an incomplete and therefore inaccurate description of profit. The march of civilizations is a series of defenses that man has put up against the dread of pure existence.
Bingo. So you're saying rentier profit is theft...
But I think you're conflating profit and surplus. How about in most cases surplus depends on labor as well as capital, in which case "return on capital" can describe profit, and the surplus is divided between profit and wages? En un viejo país ineficiente, algo así como España entre dos guerras civiles, poseer una casa y poca hacienda y memoria ninguna. -- Gil de Biedma
If it is a political matter, then "return on capital" and "return on labour" are misleading and one should rather speak of "value added" by the production process as a whole, and "value captured" by different parties to the production.
Well, for one thing, labour cost is something a business organization or project pays out, while profit is something that it receives (specifically, it is that portion of income that is left over after all costs, including labor, are paid for). I don't quite see how labour cost could be confused with profit. The march of civilizations is a series of defenses that man has put up against the dread of pure existence.
In point of fact, one might argue that in the case of a particularly unproductive upper management, the shareholders (who are remunerated with "profits") add more value to a going concern than upper management (who are remunerated with "wages"), by virtue of making it easier to obtain operational credit at lower cost.
Another traditional view holds that profits accrue to those who own productive assets, while wages are paid to those who do not own the productive assets they employ.
But when you move up into the upper reaches of the organisation, both of these distinctions blur (in many of the bonus schemes lavished on upper management, they have all but disappeared). Management salaries become partly contingent on shareholder profits (or, in a more pernicious version, share prices). And management, not shareholders, are the ones who actually exercise control over the productive assets of the firm. Combined with the fact that upper management is very rarely fired for cause - they are normally bought out through golden parachutes - this raises a very real question as to whether the management cannot be said to co-own the assets in question, and thus whether their remuneration should be regarded as wage or profit.
This is not an entirely theoretical exercise. Non-profit organisations are permitted to pay market rates for management services, which means that when a non-profit becomes sufficiently large and complex (and "market rates" for upper management therefore take on an increasingly profit-like aspect), there is reason to question whether it does not, de facto, generate profit.
quite the quote! ~"When an inner situation is not made conscious, it appears outside as fate." Karl Jung~
Do you also agree that that activity would still be 'organised' if you remove one (however significant) element, whatever actual form it takes?
Would such a green-socialist system be based on a price-profit mechanism in which the factors of production were organized (e.g. by worker-owned corporations, cooperatives, entrepreneurs, state-owned businesses, etc.) to obtain a surplus (or profit) from society in return for the goods produced by this organization?
In short, no.
First, the 'green' part of green-socialist means that it's not society alone that is considered. It's now widely recognised that for any economic activity, you could consider externalities. But one could go further and specifically consider external depreciation, that is loss of value: from the lowering of real estate prices for homes near a new highway through air pollution to the loss of uniqueness (as a worth on its own) in the form of species going extinct. Now,
Now, the question could be re-phrased by talking about "surplus" as what remains after fixed wages, even if that too belongs to workers. However, why exclude the possibility of a company/enterprise doing without wages? So, we could consider things in terms of one workers' share on the income. Which the worker would of course wish to increase -- but if it is a bit more in one year and a bit less in another, is that a catastrophe?
But, the concept of growth gets muddied further if we also consider that workers could collectively decide to re-invest more of the income minus expenses, or that workers could collectively reject schemes that would increase one (remaining) workers' share by reducing the workforce and increasing productivity. So from price-profit mechanism, we are back to a price system and just "wish for a good life" as the basis of economic activity. *Lunatic*, n. One whose delusions are out of fashion.
By "overall surplus" I meant economic growth, in this case, more or less GDP minus ecological depreciation. *Lunatic*, n. One whose delusions are out of fashion.
