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  1. #1

    Default Define capitalism, socialism, free market fundamentalism, communism, etc.

    I want to attempt a different sort of political discussion:

    1. Define capitalism, socialism, free market fundamentalism, communism, and any other concepts you feel are relevant.
    2. Defend your decision to demarcate these concepts the way you did in terms of usefulness in discussion, and proximity to colloquial use.
    3. How do your definitions of these concepts relate to statements you often make about these concepts? How would your statements change if you used the definitions that somebody else came up with?


    Yes. My goal is to make this whole discussion centered around semantics, but hopefully a meaningful discussion of the semantics involved.

    I don't expect anyone to "win" the discussion by proving their definitions are best--I don't expect any sort of resolution.

    I am hoping to get a glimpse into the "landscape" of economic conceptions that are often thrown around in political discussion.

    Accept the past. Live for the present. Look forward to the future.
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    "As our island of knowledge grows, so does the shore of our ignorance." John Wheeler
    "[A] scientist looking at nonscientific problems is just as dumb as the next guy." Richard Feynman
    "[P]etabytes of [] data is not the same thing as understanding emergent mechanisms and structures." Jim Crutchfield

  2. #2
    Senior Member UniqueMixture's Avatar
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    You'll probably have to due a search on those terms and extrapolate them yourself. People don't like to feel dissected, esp. about very personally held things like politics.
    For all that we have done, as a civilization, as individuals, the universe is not stable, and nor is any single thing within it. Stars consume themselves, the universe itself rushes apart, and we ourselves are composed of matter in constant flux. Colonies of cells in temporary alliance, replicating and decaying and housed within, an incandescent cloud of electrical impulses. This is reality, this is self knowledge, and the perception of it will, of course, make you dizzy.

  3. #3

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    Quote Originally Posted by UniqueMixture View Post
    You'll probably have to due a search on those terms and extrapolate them yourself.
    Internet searches will just give common "academic" definitions people use. But I think the visceral conceptions people have can be quite different.

    One of the main reasons I am doing this is that people usually just use words to denote things, not to connote things.

    Put differently, people usually just label phenomena with words, with no thought to how those words will later be used in statements, or how those statements will influence their thinking.

    This is OK most of the time, but when it comes down to examining and evaluating our own ideas for truthfulness based on evidence, this simple labeling approach falls short.

    Quote Originally Posted by UniqueMixture View Post
    People don't like to feel dissected, esp. about very personally held things like politics.
    Hehe, nobody can use a scalpel on you over the internet

    But, to people at ease, I will go ahead post mine (and be dissected ).

    Capatilism

    My definition
    To me, capitalism, is a system where individuals of firms owned by varying numbers of individuals, compete in a market through price, product features, promotion and distribution of the product, for exchanges with other individuals or firms.

    Usefulness and proximity to common usage
    This definition seems very much in-line with what people refer to when they talk about capitalism. Usually, they use it to denote the class of economic systems used in the U.S., the U.K. and other nations with similar systems.

    It also draws a distinction between other things that could be denoted by the same label. Things like "materialism", "Western ideals", "Democracy", "corporatism", etc.

    But the definition makes, for me, a simple operational definition for what part of this vague label of "the economic system the U.S uses", is actually capitalism, and it makes it easy to see how capitalism occurs in places outside of the original context of the colloquial label.

    Relation to statements I make about capitalism
    I make statements like:
    • "Capitalism and the rule of law are not mutually exclusive." There are many people who, as a knee-jerk reaction, think that any way to obtain profit is "capitalism". To them, if you kill someone and take their money, that is capitalism at work. Obviously, this notion of capitalism is very different from mine.
    • "Regulation does not kill capitalism." There are many people who feel any sort of regulation is anti-capitalist. But this is the flip-side of the other knee-jerk reaction. Obviously, we need some rules for there to be a way to compete on legitimate means. Black-mail, insider information, special treatment for personal favors, and things like that have no place in a good efficient market. Then there is the fact that in many markets there are externalities that may require some restructuring. Regulation dealing with either of these things seems perfectly compatible with capitalism to me.


    How those statements may change if I used some alternate defenitions
    If I believed capitalism was about the belief that "self-interest and greed are good" then I would not make the statements. But it would be interesting to find out what people actually post about their own definitions.

    Socialism

    My definition
    For me, socialism is an economic system where consumption and production are done at the level of some social group.

    Usefulness and proximity to common usage
    I believe this is in keeping with what people usually denote as being socialist. Things like what the French Socialist party advocate for, and also things like unemployment benefits, and social welfare in general.

    The definition is simple enough to use in different contexts, and it brings into the fold things like food co-ops, and credit unions.

    Relation to statements I make about socialism
    "Capitalism and socialism can co-exist" is one statement I make. From my definitions, this follows quite easily. Credit unions compete with banks in a market, but the strategy the use to compete is a socialist one.

    How those statements may change if I used some alternate defenitions
    Obviously, if I defined Socialism as "anti-capitalism" I would not make the statement I gave above. Again, it would be interesting to see how people actually think of these things. Then I could make a realistic comparison of how my thinking would be different.

    Free Market Fundamentalism

    My definition
    This is a derogatory term for the more neutrally phrased "Laissez-Faire capitalism". This, to me, refers to exchanges between private parties without any government intervention, including investigation, oversight, regulation, taxes, etc.

    Usefulness and proximity to common usage
    The term is almost exclusively used by people criticizing capitalism. So considering it a derogatory term seems appropriate. It is often used to denote all the cases when capitalism leads to bad things.

    However, I think, operationalizing the phrase to refer to absolutely no government oversight makes it useful as a concept to contrast ideas against.

    Relation to statements I make about free market fundamentalism
    I make statements like: "Capitalism does not imply free market fundamentalism."

    As per my comments above that I don't believe that people killing others to take money is an example of capitalism, it should be clear that capitalism and free-market fundamentalism are very different things in my mind.

    Free-market fundamentalism would allow the above transaction, in the sense that it is an exchange between private parties (one person exchanged the time of engagement for the money the other, the other person exchanged her life for the opportunity to attempt whatever she was trying to do) and since the government will not investigate, regulate, or in any way intervene. This is fine.

    This is an obvious straw-man. Nobody who believes capitalism is a good system believes this sort of behavior should be allowed. However, it does give us something to think about regarding where one does actually draw the line on regulation.

    How those statements may change if I used some alternate defenitions
    Well, in this case, we are dealing with a term that is create especially to disparage. But if I believed that capitalism was the same as free-market fundamentalism (as defined above), and that someone believed in capitalism, I would be quite upset at the person. Again, I want to know what people using this term actually thinks it is. It would help to get a good idea of what may be a reasonable position.

    Communism

    My definition
    For me, communism is the belief that all things belong to all people, and that resources should be allocated according to need.

    Usefulness and proximity to common usage
    The common usage seems to refer to the ideology of Marx, and his intellectual descendants like Lenin. I believe I have captured this ideology accurately, but in simple terms.

    I think operationalizing the word communism to be some ideal is useful in that it sheds light on the troubles it has during implementation. Communism doesn't refer to how one might distribute resources to where it is needed. Capitalism, on the other hand, has a mechanism at its center--the market, where things like price determine how resources are distributed. Capitalism, in itself, has no ideal.

    I also think that it is useful to refer to all things belonging to all people as a way of distinguishing it from socialism, where the social group involved can be of any size (whereas in communism, the social group is all people in the world).

    Relation to statements I make about communism
    One thing I sometimes say is "The way things are, communism is not achievable." This is because, in my definition, communism, is an ideal in which resources are allocated according to need.

    How those statements may change if I used some alternate defenitions
    If I believed communism was actually an economic system of some sort, then there may be some way that I could be persuaded to some of its merits...maybe.

    Accept the past. Live for the present. Look forward to the future.
    Robot Fusion
    "As our island of knowledge grows, so does the shore of our ignorance." John Wheeler
    "[A] scientist looking at nonscientific problems is just as dumb as the next guy." Richard Feynman
    "[P]etabytes of [] data is not the same thing as understanding emergent mechanisms and structures." Jim Crutchfield

  4. #4
    Senior Member UniqueMixture's Avatar
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    How do you see economic systems as interacting with morality? I think that is going to trip up the communication because while capitalism may not have an ideal it does have goals. These goals have impacts on real people which form the emotional attachments or disengagement from the idea of these various systems which I believe causes the obfuscation you noted in your OP. By goals, I mean by virtue of function not by intent per se.

    I would distinguish communism as an economic system in which the state distributes resources. In the "ideal" sense, the state being the people. Note: by ideal, I mean in the platonic form sense of the word.
    For all that we have done, as a civilization, as individuals, the universe is not stable, and nor is any single thing within it. Stars consume themselves, the universe itself rushes apart, and we ourselves are composed of matter in constant flux. Colonies of cells in temporary alliance, replicating and decaying and housed within, an incandescent cloud of electrical impulses. This is reality, this is self knowledge, and the perception of it will, of course, make you dizzy.

  5. #5

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    Quote Originally Posted by UniqueMixture View Post
    How do you see economic systems as interacting with morality? I think that is going to trip up the communication because while capitalism may not have an ideal it does have goals. These goals have impacts on real people which form the emotional attachments or disengagement from the idea of these various systems which I believe causes the obfuscation you noted in your OP. By goals, I mean by virtue of function not by intent per se.

    I would distinguish communism as an economic system in which the state distributes resources. In the "ideal" sense, the state being the people. Note: by ideal, I mean in the platonic form sense of the word.
    Sorry. I don't stop by that often anymore.

    To be clear. I think it borders on some sort of mental illness to accumulate wealth beyond securing basic comforts, if it is done at the expense of others.

    But competitive markets have their place in creating a system of meritocracy of sorts. However, as with all aims at measuring merit, people learn how to game to system (whether the way we measure merit is in the demand for product, or votes, or grades).

    Also, I do believe, if it was possible, that resources should go to where they are needed instead those who can compete the best at getting them. But how would this be accomplished?

    Accept the past. Live for the present. Look forward to the future.
    Robot Fusion
    "As our island of knowledge grows, so does the shore of our ignorance." John Wheeler
    "[A] scientist looking at nonscientific problems is just as dumb as the next guy." Richard Feynman
    "[P]etabytes of [] data is not the same thing as understanding emergent mechanisms and structures." Jim Crutchfield

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    Senior Member UniqueMixture's Avatar
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    I think that is dicey as well to be honest because I do think that people should be rewarded for working harder (longer hours, more strenuous activity, activity that entails higher physical risk, activity that involves moral hazards) and also I believe that creation should be rewarded (technological or social). I also believe that people have basic physical, emotional, social, and mental/spiritual needs. To me the "point" of money is to get as great of a percentage of the population to be self-actualized so they can lovingly create for the progress of life (not just humankind). I think the incentives involved should encourage the betterment of individuals over time (I define betterment as having greater probability matrices ie their ability to perform different kinds of actions/form different kinds of relationships). The problem is life is very complex. Every time you attempt to control the universe to make it do what you want the universe simply becomes more complex because physical processes can be inverted which leads to the mirroring of processes along differing axes of symmetry. Anyway, sorry to be esoteric and I really do want to stay on topic and contribute meaningfully to this thread, it is just that I truly do see this as part of a larger "grand scheme" which I get excited thinking about

    I think the reason people try to garner ungainly amounts of resources is for safeguarding physical protection and to signal higher status/sexual worth. It's one mating strategy that worked well in the jungle, but is not as necessary as it once was.

    To answer your question, I don't think there are ultimate answers. But, I do believe there are things we can do to make things like economics -more fair-. Things like having an economic system that intertwines neurological reward with behavior or just creating a fairer tax system. To be honest, this is not going to be done online. In many ways the human race is still evolving to the level of complexity to allow for that. The thing is, focus on what you can control not on what you cannot. Perhaps your role is to run for office or to have lots of children or to write a book or to teach. You'll have to DO something though. Learn to be also, and let yourself realize that life is to be appreciated as it is NOW also not with, but BECAUSE of its flaws and imperfections. I hope this is useful to you I know spiritual sounding things as solutions can lead to feelings of despair that more concrete solutions are not available.
    For all that we have done, as a civilization, as individuals, the universe is not stable, and nor is any single thing within it. Stars consume themselves, the universe itself rushes apart, and we ourselves are composed of matter in constant flux. Colonies of cells in temporary alliance, replicating and decaying and housed within, an incandescent cloud of electrical impulses. This is reality, this is self knowledge, and the perception of it will, of course, make you dizzy.

  7. #7
    Senior Member Survive & Stay Free's Avatar
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    They are all modern political ideologies, whereas capitalism is a name given to the economy which best supports the class struggles of the wealthiest and most privileged.

  8. #8
    Senior Member pv255's Avatar
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    Quote Originally Posted by UniqueMixture View Post
    I think that is dicey as well to be honest because I do think that people should be rewarded for working harder (longer hours, more strenuous activity, activity that entails higher physical risk, activity that involves moral hazards) and also I believe that creation should be rewarded (technological or social). I also believe that people have basic physical, emotional, social, and mental/spiritual needs. To me the "point" of money is to get as great of a percentage of the population to be self-actualized so they can lovingly create for the progress of life (not just humankind). I think the incentives involved should encourage the betterment of individuals over time (I define betterment as having greater probability matrices ie their ability to perform different kinds of actions/form different kinds of relationships). The problem is life is very complex. Every time you attempt to control the universe to make it do what you want the universe simply becomes more complex because physical processes can be inverted which leads to the mirroring of processes along differing axes of symmetry. Anyway, sorry to be esoteric and I really do want to stay on topic and contribute meaningfully to this thread, it is just that I truly do see this as part of a larger "grand scheme" which I get excited thinking about

    I think the reason people try to garner ungainly amounts of resources is for safeguarding physical protection and to signal higher status/sexual worth. It's one mating strategy that worked well in the jungle, but is not as necessary as it once was.

    To answer your question, I don't think there are ultimate answers. But, I do believe there are things we can do to make things like economics -more fair-. Things like having an economic system that intertwines neurological reward with behavior or just creating a fairer tax system. To be honest, this is not going to be done online. In many ways the human race is still evolving to the level of complexity to allow for that. The thing is, focus on what you can control not on what you cannot. Perhaps your role is to run for office or to have lots of children or to write a book or to teach. You'll have to DO something though. Learn to be also, and let yourself realize that life is to be appreciated as it is NOW also not with, but BECAUSE of its flaws and imperfections. I hope this is useful to you I know spiritual sounding things as solutions can lead to feelings of despair that more concrete solutions are not available.

    I agree with many of points you stated. I write about this in a blog I just started. www.qualitatedmoney.com

  9. #9

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    Quote Originally Posted by pv255 View Post

    I agree with many of points you stated. I write about this in a blog I just started. www.qualitatedmoney.com
    Hmm. Your blog seem to indicate you either have a strong interest or background (or both) in finance.

    I share many of the sentiments of UniqueMixture.

    I feel like the expected microeconomic behavior of firms to maximize profit leads to wasted resources in many cases.

    I remember arguing with my microecon professor about whether or not to keep a shop open for an hour where the expected net profit is zero (although the earlier part of the hour is expected to have higher profit). I was trying to find out how to accurately account for the opportunity cost associated with spending time to eek out the last ounce of profit.

    Do you have any thoughts on how we could actually go about allocating resources appropriately?

    Accept the past. Live for the present. Look forward to the future.
    Robot Fusion
    "As our island of knowledge grows, so does the shore of our ignorance." John Wheeler
    "[A] scientist looking at nonscientific problems is just as dumb as the next guy." Richard Feynman
    "[P]etabytes of [] data is not the same thing as understanding emergent mechanisms and structures." Jim Crutchfield

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    Senior Member pv255's Avatar
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    Quote Originally Posted by ygolo View Post
    Hmm. Your blog seem to indicate you either have a strong interest or background (or both) in finance.

    I share many of the sentiments of UniqueMixture.

    I feel like the expected microeconomic behavior of firms to maximize profit leads to wasted resources in many cases.

    I remember arguing with my microecon professor about whether or not to keep a shop open for an hour where the expected net profit is zero (although the earlier part of the hour is expected to have higher profit). I was trying to find out how to accurately account for the opportunity cost associated with spending time to eek out the last ounce of profit.

    Do you have any thoughts on how we could actually go about allocating resources appropriately?
    My undergrad is in engineering, and I currently work as an engineering consultant. I was working on a mba with a concentration in finance at night, but I recently stopped. I am extremely interested in psychology, and economics is a platform of measuring psychology in my opinion.

    UniqueMixture recognizes that the goal of life is to be happy. Maslow categorized things that make us happy. I think the way we use money is a form of displaying what makes us happy. In addition to Maslow, I think MBTI and Carl Jung's work describes what we see and how we judge situations. For instance, a majority of the America is SJ, SJs base their thoughts/feelings on past information. That is why one of Fed's goals are to maintain stable nominal prices on goods/services even though relative prices are quite volatile. Stable nominal prices allows SJs to feel secure to pursue higher level achievements. (this isnt just limited to SJs, they're just an example) A real-world example of this is the growth experienced in the late 1990s even though the real value of many things were declining.

    In general I think the resources are allocated efficiently. The negative connotation of bubbles is exaggerated. For instance, the technology bubble gave us cheap internet and computers, which is creating massive amounts of value in my opinion. I think this housing bubble wasnt all that bad and will provide affordable housing for many people in the near future. Affordable houses will give us the freedom to pursue higher level values.

    The opportunity cost associated with that extra hour of operations really depends on the situation of his/her employees. If there is a labor surplus than the shop owner is employing someone for that extra hour that helps the employee but may not help the owner that much. If there is a shortage of labor that extra hour may be a waste of a employee's time to pursue more profitable endeavors.

    If you are referring to the market crash of 2008 as a poor allocation of resources, I disagree. The liquidity crisis of 2008 was a overreaction to a minor flaw in the banking system. I wrote about this in my post about CDOs. There is a more technically correct paper written by some Phd that describes exactly what I was saying. I will post it on my blog in a bit.

    http://www.qualitatedmoney.com

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