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The Free Market and Social Justice
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You did assert that it would eventually solve the problem, presumably in some plausibly satisfactory way. To translate Goumindong, there is no reason to believe this will take place. "There will be demand for a scarce resource" does not, itself, imply "there will be clear and easy divisions of property rights compatible with the prevailing social order, easily and cheaply enforced, for suppliers to create a rivalrous and excludable product that meets this demand".
Which is why you have a funny definition of "solve".
Typically when you talk about the "solution to a problem" with problem being "something that is bad" rather than "a system to be solved" you mean "the result which negates the problem". Not is is possible to think of a solution in terms of "1+ 1 = x, what is x". But in this context it does not make sense. A free market will "solve" any problem by that definition, as would direct government production setting. They would do this because the "solution" to an actual system that exists is trivially "what happens".
Saying that the free market solves the problem of water shortages is like saying that gravity solves the problem of flight. In that your plane falls from the sky and explodes and everyone in it and around it dies. But look, it has stopped losing elevation!
Note that "the market, left alone, would not cause the human race to die of dehydration" is also not true. Whether that happens or not depends on a lot of factors.
The easiest way to think about this would be to consider peak oil from a rational perspective. Let us assume no government intervention into the creation of alternative energy systems. Let us use a very simple model, a representative agent maximizing inter-temporal utility.
The long term solution to the production of oil, consumption, and investment into alternative sources of energy has an infinite number of potential equilibrium. However, for the purposes of our discussion we can separate these into two types.
1) Solutions with positive investment.
2) Solutions with zero investment.
What you are essentially saying is that there are no solutions with zero investment. But we cannot guarantee the conditions under which "zero investment" doesn't happen. Specifically Zero investment will occur when our discount rate is higher than the return on investment.
Now we might say that the return on investment goes up as price of oil goes up, except of course that it takes energy to create alternative energy sources, so the cost of investment goes up with the cost of oil.
In the end, we have no guarantee that oil shortages will lead to investment in alternative energy, we may simply decide to use the oil to consume rather than invest since we prefer consumption to investment.
Edit: My point is that the "free market" does not guarantee that the solution to a limited resource will not simply be "use up all the resource" and that is when we are ascribing to the free market all the fantastic assumptions we probably should not be ascribing.
Hey, corporations solved the problems of endangered species due to habitat destruction or over harvesting by making them extinct.
MWO: Adamski
Why is that? Why are corporations immune from the same morality that everyone else has to follow? If something is immoral but legal, I would say a person shouldn't do it, why doesn't the same hold for corporations?
In practice the 'management' personnel tier can form a significant proportion of employment and it is really only the board of directors who can be said to represent capital directly.
As for what one might wish to 'impose' on corporations: would such an 'imposition' be, for example, immunity to claims of failure to fulfill fiduciary duty in certain select cases? Then there is nothing that will prevent them from enacting these cases 'voluntarily', you see.
I think KD approached this from the wrong direction. The problem I see is that even for something like slavery there is a subset of people that either don't care that's immoral or don't believe that it is and thus if society does not say that they cannot engage in it will do so if it makes a profit. Thus to prevent this you need to not rely on corporations doing what you believe to be right, but instead construct laws that enforce doing so.
The average person's morality revolves around right and wrong, with some balancing from their need to survive; we know it's wrong to buy, say, cheap clothes made in sweatshops, but if they're high-quality, and they're also all we can afford, we compromise. At the same time, when we see someone drop a $20 bill, we yell, "Hey, you dropped some money!" (unless maybe we can't afford to let $20 go I guess).
Corporations (and their management) don't have that morality built into them (unless they're ran by highly moral people). Their number one obligation is to run the company to the benefit of the compny's owners. Now, buying sweatshop stuff may be unprofitable in the long run (if customers are outraged and ditch the company), but unless these types of things happen, there isn't much moral push to get corporations to behave in a moral manner.
There is a reason that minimum wage is something that companies (not so much people) fought. They wouldn't pay a minimum wage unless they had to, be that demand from regulation or from the market.
TylerJ on League of Legends (it's free and fun!)
I'm not sure how trivial that realization is... especially in today's climate.
That's true, but surely you understand the current climate vis a vis Free Market Solutions.
As in, there's an entire party that refuses to let the government sneeze lest socialism spread.
the "no true scotch man" fallacy.
But the idea that his legal obligation to the investors translates into a moral obligation that trumphs the immorality of slavery and makes the act of selling human beings a moral endaveour is absurd. It implies that the lives of people are worth less than loyalty to capital.
(I liked your last avatar more, even though I don't know jack shit about Warhammer.)
Also, @Tiger Burning, you make a good point, though yeah, the cases where I've seen it used are cases that I would argue fall under the "causes harm to others" clause that makes us ban child pornography. It's just that no one really wants to argue the opposite of how it causes harm to others.
Except the inevitable conclusion of those profit-maximizing entities is that they must also control the regulatory process.
Which is something they often do.
We seem to be assuming that any and all things which we may regard as non-ideal can and should be reasonably subject to explicit definition in legislation here then, which seems untrue. I already noted that in labour law there is a combination of proactive legislation actively carving out loose reins, plus a degree of jurisprudential 'activism' in this regard (avoiding the Lochner error, whatever the error is precisely).
As a matter of principle, I do not see why it is the case that we should enforce corporate operation as close to the legal boundary as is humanly practicable. The investor already has a substantial lever, which is to invest her money elsewhere or for that matter dismiss management through her elected shareholder representatives; why is strengthening these levers in the direction of overt legal amorality socially desirable?
Actually it is a feature of the capitalist system.
You, in this thread, are specifically advancing the idea of corporations and such being utterly amoral profit-seeking entities. And then are pretending like those entities doing exactly that via regulatory capture is not part of that system?
Please.
Influencing government has an incredible rate of return
Yup. The people with the money ALWAYS have the power. That was just as true in the Soviet Union as it is in the United States. Capitalism isn't the problem here, it's unrestricted, deified capitalism that is the problem.
Better laws, or even failing that enforcement of the laws we have would go a long way toward righting the ship of state.
Like I always say, I don't care that Mitt Romney has a fuckton of money. I want him to stop getting in my way while I try to get my own fuckton of money.
So one would think it would be smart to not create incredibly powerful amoral entities.
Is your argument that there ought not be corporations, or that we should somehow make them be moral, extra-legally?
Either. Both. I'm not pretending I know the solution.
I'm just pointing out that if you combine your premise that every system gives inordinate power and influence to the wealthy with the idea of creating huge wealthy amoral entities, you will very obviously get very bad things.