There is no conflict between capitalism and communism. Capitalistic states are usually also democratic, and all communistic states are totalitarian. The real conflict is between democracy and dictatorship.
Many decry inequality as a failure of capitalism. Well, inequality is much worse in communist states.
Inequality in democratic states is generally caused by the failure of education to match up with changes in technology. Companies doing well are starved of qualified staff, so they pay very well for the few they can find. Meanwhile, many low-skill people have lost their jobs, but have no other marketable skill, except to serve fast food.
I fail to see how a totalitarian communist regime can solve this problem satisfactorily.
Many experienced qualified staff lose jobs also, easily replaced by a younger, thus less expensive candidate or none.
Personal choices also factor in such as having babies without husbands, abusing drugs, earning a criminal record.
Education has always played a role.
Current trend is an increase of unequalities. Rich get richer, poor poorer, the so called middle class constantly eroding.
This will continue for a very long time.
The problem and solution with cspitalism is that it is a collective choice, but, you know, collective choices change veeery slooowly
Have a nice day
I have seen collective choices change very rapidly. Introduce the correct incentive and poof! One example I recall vividly was the disappearance of the typewriter.
When you say the rich get richer the poor, poorer - I say that cannot sustain itself. Permanent reduction in the wealth and income of the "poor" means the rich will suffer a similar effect. A rising tide floats all boats but also sinks them.
A shrinking middle class will ensure the rich join them. In a voluntary economic environment, upward & downward economic mobility will flourish as better products & services from the competition take advantage.
Exchange of one technology in place of another is nothing similar (in scope or extension) of the change of an entire economic system ;)
This trend (rich richer, poor poorer) is unsustainable? For sure!
But there is a lot of space left for this to continue until a breaking point is reached. This is, among other effects, the result of the steady economic decline that the Committe is talking about.
The general amount of economical value (true economical value, not fiat assets made of paper) is currently leveling off or maybe shrinking. In this context, people that have money continue to grab the better opportunities, legislation of countries are all in need of money to continue to run as usual, and the easier way is to take the money from the "poor" part of population, because they are less able to fight back as the richer people, and because they provide a fairly larger amount of money (the poor have less, but they are a lot).
Such is the economic jungle law in a shrinking environment
Without a forced revolution or coup d'etat, economic systems evolve. Rapid change is either war or threat The economic breaking point is like freezing water; if constrained it will crack its container. If left unrestrained, there will be no break, nothing will snap. Certain interests will see rapid change which hurts and feels like a rupture TO THEM, but it is not the same thing.
"True economical value" isn't much different from fiat paper currency. Solid materials are only valuable because we choose that point-of-view, just as we do with cash & coin.
I don't know about other nations; however in the USA it's been well studied and established that even a 100% income tax on the top 1% of incomes - a LARGE amount - would barely make a dent in the USA's annual budget deficit and have almost zero effect on debt levels. Taxing the rich is almost a guaranteed to to worsen economic opportunity for everyone else.
Yes it's easier to take money from the less rich, but doesn't everybody vote? Look at Donald Trump (I understand that's painful.) Yet look at what tone-deaf politicians have done in the USA for decades, which is FAR more painful, providing many reasons somebody like Trump was elected.
here in Italy, at least concerning this restricted issue, we were a precursor. We elected Silvio Berlusconi, an well known tycoon, as a reaction to the previous governments (they were mostly right-center oriented , whaterver meaning it has this label :D :D)
He indeed brougth deveral ruptures in the business as usual, at least political business as usual, but, after two decades in which his different governments exchanged seats with left-oriented governments ( he became Prime minister three times ) we understood that he basically brought NO economical improvement. Our debt level increased during his ruling at the same rate as the left-oriented ones. Our economy was ruled mostly by foreing economical environment, the local government had (and has) very limited manouver inside it.
The same apply to US (eve if the size of economy is not confrontable between Italy and US). Trump has been elected to break the business as usual, and he will do it. He will be unable to change the general trend. People will continue to lose jobs, people will continue to see rising level of debts. But this will come in due time: Trump has several tools to delay the recognition of this basic fact, mostly putting the blame on foreing countries or corporations ( this is not an entirely wrong idea, but not to the extent it will be argued).
It is funny to see how difficolut is for Trump to remove the Obamcare, to say one. Or a way to ameliorate the relationships with Russia, lifting some of the measures enforced against it in the last month of Obama government...
This is to say, that the bosy of collective decision that make our history is not easily changable as one would think.
I suppose that it will take a couple of years to Trum just to remove the Obama measures that He tought would take a month to have the job done :)
Have a nice day
Sales of ice-cream are positively correlated to incidents of rape and other violent crimes. Ice-cream must be causing rape and other violent crimes!
Of course not, hot weather is the underlying cause of higher ice-cream sales and crime. Ice-cream does not cause crime.
The rich gets richer and the poor gets poorer not because of a person's wealth or lack thereof. In a market economy, people who produce more value to the economy are paid more, as an incentive to create even more value to the whole economy. The rich gets richer, generally, because they produce more value, and not because they are rich, per se. Vice versa for the poor.
Whenever the economy deems the output of a person (regardless of that person's wealth) less useful, less will be paid for that person's output, even though that producer might be rich.
Last time I look, the price of service or goods is dependent on its value, regardless of the wealth of the vendor. if the poor wants more money, just produce more goods or service of higher value (as determined by the whole economy).
But how can the poor produce more when their jobs have been replaced by machines or computer systems?
That is my whole point! If a task can be performed more cheaply and reliably by machines, the value of that task is limited by the cost of machines. A person can do something else not replaceable by machines, or charge less than a machine for the same task.
Or we can all be Luddites and return to the stone age.
But please don't imply or suggest that the system is rigged by the rich against the poor. That is not sustainable in a market economy (aka capitalist system) in the long run.
The newly unemployed person replaced by a less expensive machine (or younger [thus often less costly] person, or an imported one willing to work for a lower salary) will still create a demand for goods and services, and the economic eddies, flows & currents continue.
Bear always in mind, rich = income or assets? Competition will chase income opportunity; so the recipient of "high" income is always under pressure to continue producing value. Assets left stagnant erode in purchasing power, and if invested to preserve that value, then provide capital & opportunity for someone else.
I don't think it's remotely as simple as saying that those who produce more value to the economy are paid more. It drives me crazy when people say that.
When a relatively few people have far greater access to politicians and use the government to enact regulations that favor their own economic activity at the expense of others, that is not a fair playing field. What looks like "free trade" or "fair competition" isn't always free trade or fair competition.
The bulk of people seem to have yet to understand this.
Collective value over time always earns more, but individual variations always did, do & will occur. There is no homogeneous rule, just a cumulative effect and trend.
Education, awareness & voting solve the gov't + business "arrangements" BUT when a government becomes as large as all of them seem to be, it becomes overwhelming to attempt to understand it. Not voting is .... an invitation for trouble.
Game of Thrones and Star Trek are such convenient replacements. Pass the chips . . . .
Free trade is an opinion, easily changed by altering the definition of "free". Hello, politicians....
Any information on the future of North Korea?
Certainly - what are the questions?
Well will communism always be in North Korea or will there leader eventually be overthrown and maybe turn to capitalism?
Capitalism will re-emerge. All economic systems are naturally capitalistic until distorted by rules. When enough of the participants in North Korea see the restrains those rules create working against them, change will come. Says The Committee, "If a majority of the population of North Korea were aware of the tensions created by their leader's decisions and the costs, his regime and current social and economic systems would see a swift metamorphosis."
just a short remark: the economy is basically the study of human beahior with respect to material possessions: this behavior is only partly rational. We have also perfectly rational behaviors at peronal (aka microeconomy) level, that are very bad at greater scale (aka macroeconomy), for example hoarding of cash that plunge economies into depressionary trends.
Currently we are experiencing a combiantion of limits hitting together our current economical (usnustainable) setup: consumption of natural resources bejiond the replacement rate, consumption of fossile energy bejond the net energy return (this involves a discussion on the EROEI concept, I will leave it to another day), excess of debt (yes, debt as much as money is an agreement, but a large scale collective agreement is as solid as a rock when it comes to change it abruptly, because this involves tha change of collective belief and habits).
Just pointing out the problem of collective habits: The Committee says that Global Warming is not human driven, ok. But the utter failure of the Global Warming movement to enforce changes to mitigate the preceived problem is not linked to this. It is linked to the sheer amount of inertia that change of mass beahior implies. Just to state it clear, even in the hypotesys that the Committe would say that, yes, Global warming is human driven and will bring chaos and mayem to the Earth climate, this would change little if nothing to the human response to the issue.
Paragraph 1: Indeed it is, and economic study is properly called a social science for this reason. You described well what helped bring about the great depression in the USA in the 1930s. Had a different monetary policy been pursued, the depression would not have occurred. The collective choice was mistaken against the collective effect of individual choices.
Paragraph 2: Indeed we have created these things; the effects to come will not be boring.
Paragraph 3: Human responses I believe will be positive if good information is explained to the majority. I have great faith in humanity to act in our collective best interests when the implications of ndividual choice, group decisions and overall effect are understood.
I must admit it's almost as interesting reading pierluigi talk about subjects as Patrick and tc