Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Now there's the revolutionary spirit!  Where do I sign up?  

I just saw this facebook group: Don´t support Communism - Say NO to tap water!

Tap water is putting unfair pressure on the bottled water industry. How are entrepreneurs supposed to compete with practicly "free" (i.e. communist) tap water?

It is a disgrace!

We are also opposed to other kinds of communism:
like downloading movies and music
like freeriding on public transport
like using tax-financed pavement
like eating at home instead of on a resturant (of course if you have a cook employed then it´s OK)
like having sex without any money being transfered

There is no such thing as a free lunch.
There is no such thing as freedom - it comes with a price tag. And if you can´t afford it? Tough shit, dude!

But of course the greatest threat to the free world is tap water. In the words of swedish anti-communist blogger The Badlands Hyena Vomit Titbits:

"The tapflushers [i.e. evil-doers] is living on somebody elses expense"

We all know filesharing is killing the music industry. At the same time tap water is killing the water industry. Without the music industry there will be no music and without the water industry there will be no water.
Human life itself is threatened by communism.
Let´s put a end to that - with any means necessary!

LOL.  Glad to see everyone getting on the same page.
You wrote:

... the best way to design such new social structures is via democratic governance political mechanisms.  There are no capitalist enterprises that are run democratically, even in the western democracies

Are there are any democracies that are not capitalist enterprises?  Good luck designing non-capitalist new social structures via our current democratic governance political mechanisms.  Let me know how that works out.

BTW, how brilliant is this?  I don't know who made it, but I'm stealing it.  They don't believe in private property anyway, right?

"Pretending that you already know the answer when you don't is not actually very helpful." ~Migeru.

by poemless on Thu Aug 7th, 2008 at 01:15:44 PM EST
Excellent timing: I saw today, in my local supermarket, bottles of mineral water at 18 cents for a 2-liter bottle...
by gk (gk (gk quattro due due sette @gmail.com)) on Thu Aug 7th, 2008 at 06:10:07 PM EST
[ Parent ]
Thanks for an extremely clear exposition of your understanding of Capitalism which deserves a detailed response.

European Tribune - Comments - Capitalism Must Die!

Capitalism is a system of finance. It is not a system of government, nor is it even a system of management of the capitalist enterprises.

I regard "Capitalism" as a framework within which economic interactions take place. Key concepts to understanding "Capitalism" are "Value", "Property" and "Credit".

European Tribune - Comments - Capitalism Must Die!

One borrows money or sells shares to raise capital. This capital is then used to finance the operation of the firm.

You are here describing "Finance Capital" rather than "Productive Capital".

Finance Capital consists of the "Twin Peaks" of "Debt" and "Equity" legal claims upon productive assets (eg land, machinery).  These take the form of legal protocols, being the contract of secured debt on the one hand, and the "Joint Stock Limited Liability Company" or "Corporation" on the other.

When we distinguish the "Public" sector from the "Private" sector we are essentially saying that "Property" must be either in "State" ownership or in Corporation ownership.

My work is based on the fact that there are other - alternative - forms of "ownership" available, and in fact emerging, which IMHO potentially give rise to a new and "Open" form of finance Capital which does not involve banks as credit creating middlemen, but instead, potentially, as service providers.

European Tribune - Comments - Capitalism Must Die!

Who decides which sorts of new enterprises will be formed and how existing ones will be managed? In the west, it is, ultimately, the bankers who provide the capital. If you come in with a promising idea you will be able to attract capital.

In order to create productive assets, whether in Public or Private ownership, investment and/or credit or "time to pay" is necessary, as you say.

It is not necessary for this Credit to come from Banks - merely conventional. An enterprise may proceed quite happily without going near a bank by dealing entirely in cash or barter or by obtaining credit from suppliers (time to pay) or from customers (pre-payment).

Equally, it is not necessary for investment to be in the form of Equity in a Corporation - merely conventional. I could name half a dozen alternative forms of investment other than a Corporation.

European Tribune - Comments - Capitalism Must Die!

Capitalism requires growth, or there will be no investment.

Yes and No.

Investment (ie "equity") requires a Return on Capital commensurate with the risk involved. There is no reason why this should not be a steady long term income stream. eg utilities.

Interest-bearing credit - on the other hand - does require growth, and this is the cancer at the heart of our financial system, particularly when credit is created which is used not for making productive assets, but for the acquisition of existing assets (especially a "Commons" like Land), thereby causing a "Bubble".

European Tribune - Comments - Capitalism Must Die!

We have some models for these types of enterprises as well. In the past we have had mutual societies (banks, insurance, etc.) as well as cooperatives and employee owned enterprises. Variations on these arrangements need to be explored. It's the lack of imagination by economists, social scientists and politicians that is holding us back. Perhaps new ideas will have to come from the bottom up.

Indeed the future IMHO can only be mutual and cooperative, but the problem has been that the legal protocols applied historically were typically "genetically modified" forms of "Corporation" which limited the scope for "Equity" investment, by limiting the returns available.

Moreover, irrespective of "ownership" of Capital and hence of enterprises, we have always taken for granted that we need Credit Intermediaries to provide development finance, and that "Money as Debt" is necessary, which is in fact not the case.

I believe that the future lies in reinventing finance capital, and indeed that the process has already begun, from the ground up.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Thu Aug 7th, 2008 at 03:18:42 PM EST
I remember some commentary around the time of the fall of Communism that the so-called triumph of capitalism simply presaged a struggle between different expressions of capitalism.

Not just the differing flavours of european capitalism (that the EU is gradually erasing in favour of the American model) but also those from the Far East.

I have no economic background so could not, nor cannot now, give any deeper insight, but I thought it was an interesting idea.

keep to the Fen Causeway

by Helen (lareinagal at yahoo dot co dot uk) on Sat Aug 9th, 2008 at 10:28:14 AM EST
[ Parent ]
While the leaders of the PRC believe that it is glorious to be rich, I doubt that they believe that it is glorious for government leaders to be led around by the nose by the rich, as in Anglo countries.  They still understand that power proceeds from the barrel of a gun and they remain firmly in control of the guns.  They have learned that by letting businessmen do their thing, they can afford more and better guns and luxuries as well.

It will be interesting to see how this plays out.  It seems to me that the Chinese have several real structural advantages at this point.  Nor are they encumbered by any pesky traditions such as Magna Carta, etc.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Aug 9th, 2008 at 07:40:00 PM EST
[ Parent ]
they may have some advantages over us, but they have structural disadvantages such as loose regional control that means their coutnry will face serious problems from pollution, drought, thirst and starvation in the next few years.

I fear the rate of damge is so great that when they realise they have to do something urgently, it will be too late. If the people starve or thirst, no power will save the government.

keep to the Fen Causeway

by Helen (lareinagal at yahoo dot co dot uk) on Sun Aug 10th, 2008 at 05:13:21 AM EST
[ Parent ]
I recall a quote from John Stuart Mill to the effect that competitive, for profit enterprises had clearly been shown to be the most efficient means of generating wealth, but that fact said nothing about how that wealth could or should be distributed.  This is perhaps a starting point for a hybrid alternative.

One of the most fundamental agenda items for the 1960s Students for a Democratic Society was social justice in the workplace.  While the political formalisms of the United States of America are that of a federal republic that has developed a degree of representative democracy, autocratic rule has remained the norm in private enterprises, and, in a structured and constrained way, has remained the rule in most corporations.  In the context of existing laws and social organizations, the only legitimate challenge to autocratic rule is on the grounds of efficiency.

With small, closely held companies I have seen, to my sorrow, the extent to which owners will sacrifice their own profit in the name of retaining complete control.  Some different corporate cultures have developed in the last half century or so and there were dissenters during the 19th century in England, France and the United States.  Owen and Fourier leap to mind.

I believe that what we perceive as reality is in fact a social construct that we assimilated unconsciously during our youth.  That reality is powerfully reinforced by social attitudes and by religious and educational institutions.  These factors make it very difficult for most to conceive of alternatives, and it makes it even less likely that alternatives that are conceived will be embraced by others in significant numbers.

It is up to us to devise social and economic institutions that better serve our needs and that prove to be more efficient and pro-survival for the society as a whole.  I believe that this goal is best accomplished by means that maximize personal creativity and personal development and that this can only be accomplished by systems based on cooperation, not coercion.  The current system in the United States is only a couple of amendments away from one that embraced slave based capitalism.  The similarities to the prior system are more significant than the differences.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Aug 7th, 2008 at 11:05:11 PM EST
  • really great diary.

  • is your explanation of why capitalism requires growth, which i think is expressed in the paragraph --

Capitalism is a system of finance... A part of this year's profits are plowed back into the firm for expansion, or the promise of future growth is used as way to attract further investment.

-- is that a "standard"/"conventional" explanation for the claim that capitalism requires growth?  (e.g. is it something that is taught in economics classes or textbooks?)  if so, does does this interpretation/explanation have a name?

  • i hope i am not misrecalling, but i believe someone here once wrote, a long time ago, that growth in itself is not the problem, but rather the increasingly unsustainable consumption of resources that historically accompanies growth (not to mention other, albeit non-intrinsic and/or irreparable, side-effects of growth such as pollution and socioeconomic inequality.)  is it conceivable that economic growth can be made sustainable if growth with a sustainable consumption of resources is made possible?*

  • There are no capitalist enterprises that are run democratically, even in the western democracies.

are for-profit cooperatives "run democratically"?  can they be considered a form of "capitalist enterprises"?

* i know -- and agree with, as far as I can understand it -- ChrisCook's position why capitalistic growth is not sustainable because it is based on debt-based money, which ultimately is itself not sustainable, but i am putting that issue aside for now.

Cynicism is intellectual treason.

by marco on Fri Aug 8th, 2008 at 01:12:25 AM EST
See also Sven Triloquist's most recent diary.

Should the kind of innovation described by Chris and Sven occur in many industries the results could be transforming.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Aug 8th, 2008 at 07:55:38 PM EST
[ Parent ]

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