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One of the most destructive misunderstandings in economics is the idea that markets are inherently "consensual" - i.e., that everything people do in the absence of government-based coercion is a "free" decision, and thus entirely the responsibility of the individuals involved.  This could not be further from the truth under the vast majority of circumstances, and in fact the typical model of a market exhibits degrees of coercion based on unequal bargaining power that overwhelmingly favor businesses and employers over consumers and workers - often to the point that consent is effectively nonexistent.  Your options are reduced to agreeing to the terms set by businesses, or else simply doing without whatever is being sold or offered due to the absence of viable alternatives: A situation where, as far as practical necessities are concerned, the "choice" is no freer than between giving an armed robber your money or taking your chances by fleeing or struggling.

I.  Economics background

We all hear the term supply and demand to describe the forces that guide a market, and learn in school that the balance of these two competing but complementary impulses are how wages and prices are established.  What is rarely explained, however, is that these terms have nothing to do with how many people demand or supply something, or how motivated they are to seek or offer it - only how much money is behind them.  At the extreme - which is a painfully commonplace occurrence in reality - if one person has $100 million in discretionary income, and a million starving people each have $1, the market interprets that one person's idlest hobbies as involving greater Demand than the million's attempts to seek food ($100 million vs. $1 million).

The resources of the marketplace are then allocated accordingly: Far more money to provide golden toilet seats and platinum toothpicks for 1 person than to provide food to a million people, and the ratio would be even starker for all other goods and services.  And since money sunk into luxury goods overwhelmingly goes to material costs and rarefied sectors of highly skilled labor, the resulting employment and alleged "trickle down" effect is a trivial percentage of what the same resources allocated to the needs and desires of the majority would produce.

But it's even worse than it seems at first glance, because even if those million people each had $100 to spend, and thus collectively had the exact same amount of money as this one super-rich person, the market would still overwhelmingly allocate resources to providing the latter with luxury goods rather than the former with anything at all.  Why?  Because the people with $100 each individually still have little or no bargaining power - their purchases are still dictated by necessity, and the number of consumers and workers vastly exceeds the number of suppliers and employers, so in the absence of large numbers of them bargaining collectively what happens is simply that suppliers are able to set a price or a wage that extracts that surplus from them permanently.  

The one super-rich person, however, has maximum bargaining power because none of their choices are dictated by necessity, none are limited by time or geography, and the entire range of possible options are at their disposal, meaning that suppliers must compete for their business.  And because they almost certainly own businesses themselves, the same bargaining power imbalance that extracts wealth from the vast majority of people transfers it into the hands of this one person.  In other words, it may be a cliche by now, but "the system is rigged."  No one has consented to a state of affairs where every option at their disposal results in their losing ground economically to those who are already privileged - they're simply given no alternative by the market.  Markets just inherently redistribute money to those who already have the most of it, which is why they fail to benefit society when put in the driver's seat, and why we must reassert the prerogatives of the majority to an economy that serves us rather than forces us to serve the few.

II.  Bargaining Parity

However, there is a very special, theoretical case that is relatively unusual in practice in real markets where consensual transactions do occur, and one that policies should be designed to promote.  When all parties to a transaction have more or less the same bargaining power, with no great advantage on any side or with the advantages being balanced out, then and only then does the marketplace produce mutually beneficial arrangements.  Because then, and only then, no side is able to put their finger on the scale and set terms that result in a zero-sum transfer of wealth.  This theoretical case is the basis for things like buyer's clubs and labor unions, although even their most powerful private-sector instances fall far short of granting their members parity with the businesses they negotiate with - it's just somewhat less to their disadvantage.

To achieve rigorous bargaining parity in such a way that the overall marketplace serves the needs of society requires a legal and regulatory framework that mandates it.  Not being an economist, and not wanting to wade into the quagmire of regulatory minutiae that would make such a thing possible, I'll leave the details to people who would be qualified to establish them - but we as educated laymen can at least state the clear fact that such a system is needed, in addition to a rigorous social safety net and public sector services.  

III.  Brainstorming Solutions

Still, some broad outlines can be reasonably drawn:

1.  Establish official labor pools that businesses must negotiate with in hiring, that are sized to achieve bargaining parity on whatever the relevant metrics are.  So, for instance, a small business wouldn't have to negotiate with a national labor union - only with the subset pool just large enough to have the same economic power, but something like Wal-Mart would basically have to negotiate with every single retail worker in America collectively.

2.  Attempt to equalize time-constraints on contractual negotiations so that both sides lose equally in a failure to reach agreement.  In other words, compensate for the much greater urgency of workers to reach an agreement than employers.  This is necessary for bargaining parity to exist, and can be achieved by any number of diverse means.  Just brainstorming: Requiring that "strike insurance" policies and operating loans be granted to both labor and business on equal terms, counterbalancing cash supplies used to tide over a business in lieu of a contract by providing the labor side with matching funds, etc.

3.  Establish a step-by-step process for forcing the commoditization of industries that have persistently exercised bargaining advantage over their consumer base beyond the point justified by fixed costs and technological innovations.  For instance, there's no excuse for perpetual cable, telecom, and broadband monopolies after they've recovered their original investment in an area and turned a profit, and these days companies like Comcast largely stand in the way of innovation rather than pushing it.  To the extent they charge exorbitantly for internet speeds that have become standard throughout the developed world, and just simply deny even the option to large swaths of the country, these companies are compromising the economic opportunities of the majority of the people.

IV.  Conclusion

The way the market is set up in this country, the closest analogy for most people would be a prison camp with no guards or walls, but vast expanses of unsurvivable wilderness on all sides.  Prisoners in such a camp may have a purely theoretical "choice" to leave, and subject themselves to the overwhelming probability of death trying to cross the wilderness to reach food and water, but the fact that this circumstance had to be arranged that way and their place in it coerced in the first place shows that it is in fact a prison.  

Likewise, we Americans never consented to a system where terms are dictated to us by the wealthy, nor would any human being ever consent to such a state of affairs if given a choice, and transactions that take place under such a framework are little different than plain robbery.  Unlike taxation, the "taxes" extracted from the American people by business in the form of unequal influence on prices and wages were never approved by a democratic process or elected authority, and as such have an unsurprisingly erosive effect on the United States Constitution and the liberties of the people.  In order to correct this phenomenon, we must not only focus on public sector programs, but on reorganizing the private sector to harness the potential of the market under proper, consensual conditions.

11:24 AM PT: A good point made in comments raises another possible area of action in promoting bargaining parity: Equality of information.  Worth exploring.

Originally posted to Troubadour on Sun Mar 24, 2013 at 08:51 AM PDT.

Also republished by Community Spotlight, Income Inequality Kos, TrueMarket, and ClassWarfare Newsletter: WallStreet VS Working Class Global Occupy movement.


Is bargaining parity an important part of progressive economic solutions?

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Comment Preferences

  •  Good diary. (35+ / 0-)

    We see the affects on poor and middle class people regularly. Food deserts in cities, lack of choice in rural areas where big box stores have destroyed small local businesses, it isn't a free market at all.

    Eric Cantor can kiss my big old Missouri butt!

    by cyncynical on Sun Mar 24, 2013 at 09:00:02 AM PDT

  •  Excellent diary. (20+ / 0-)

    A good frame for establishing an honest, enlightened view of the marketplace and the need for a stronger Mixed Economy to achieve more sensible, equitable arrangements that serve the general welfare.

    You also eloquently demonstrate how unfounded is the notion that this country treats its wealthy unfairly when it attempts to regulate the market with various progressive schemes. There may be room for disagreement about how these programs can best achieve the goals of leveling the playing field, and space for tinkering with established "solutions", but certainly not over the fact that it is tilted ("rigged"), in the first place.

    Mindfulness is the first necessity of sanity and survival and the first casualty of Consumer Culture.

    by Words In Action on Sun Mar 24, 2013 at 09:07:47 AM PDT

  •  Actually it's even worse. (19+ / 0-)
    "When all parties to a transaction have more or less the same bargaining power, with no great advantage on any side or with the advantages being balanced out, then and only then does the marketplace produce mutually beneficial arrangements."
    The market is never guaranteed to produce mutually beneficial arrangements. At the very best, under perfect circumstances, it can only produce mutually consensual arrangements.

    If the participants consent to doing something stupid or short-sighted, the market will still help them along to destruction.  This explains global warming and other externalities.

    •  Indeed. I merely mean that on balance (5+ / 0-)
      Recommended by:
      palantir, Chi, Kevskos, kyril, Egalitare

      the presence of consensuality tends to be mutually beneficial, with the exception of the externalities you mention - which must be corrected by other means (e.g., taxation).

      I demand that you prove you're alive.

      by Troubadour on Sun Mar 24, 2013 at 09:16:31 AM PDT

      [ Parent ]

    •  and along with that equal access to information (6+ / 0-)

      which enables all parties to make an informed choice.

      A very large part of corporate and oligarchical power is control of information... which is at least as harmful as state control of information if not worse since it is more pervasive on a day to day basis... seen and unseen.

      The whole reason we attempt to prevent insider trading in the stock market is one that we all understand and yet fail to apply in the wider economy. As weakly enforced and easily circumvented as it is on Wall street and investment banks it is open season and largely absent in the wider economy. Buyer beware trumps all the labeling laws, quality, pollution, fair lending laws, lemon laws and more. The attempts were made but all watered down, repealed, neutralized and the facts distracted from if not just made invisible.

      "Make them an offer they cannot refuse"... the Don Corleone ethos underpins our brand of free enterprise... and it works best for the corporate-sized Tony Soprano wanna-bes if the offer is made outside the awareness of those who will pay... being made to agree to a deal they don't even know is being made.

      Pogo & Murphy's Law, every time. Also "Trust but verify" - St. Ronnie (hah...)

      by IreGyre on Sun Mar 24, 2013 at 10:38:15 AM PDT

      [ Parent ]

  •  nothing consensual about "work or die" (12+ / 0-)

    Sometimes I think that even greater bargaining power for employees and customers is not enough to set people free, because you still have to make the bargain in the first place.  When a handful of people exercise an effective monopoly on those most precious of resources - jobs and money - they're still the ones in charge, and whatever you get from them you get at their sufferance.

    Call me selfish but I'm not terribly interested in working and buying stuff in the first place, so the ability to command more favorable terms - while necessary and desirable - doesn't get to the heart of the problem as I see it, which is that I have to spend most of my waking life earning that life itself ... while spending most of the rest of my waking life at home on the couch for lack of the means to do anything else.

    The world is too big and life is too short to spend it in a box making money for someone else, no matter how generously you're compensated for your valuable (to them, but not necessarily to you) service.  But all the things that make life worth living cost money rather than making it ... unless you're a member of a tiny minority of gifted people, and maybe not even then since the difference between "work" and "play" seems to be whether what you're doing is obligatory or not: as in, what would happen to you if you didn't do it?

    I suspect that most people who admire and aspire to the rich do so not because they want to run a business, but because they want the freedom and the toys that they need to be rich in order to afford.  To that mindset, all of the paths to great wealth are like going around the world just to walk next door: working more and harder when they see the whole point of being rich as having the ability to work less and easier.

    •  That's more the public sector side of the equation (1+ / 0-)
      Recommended by:

      where people would be provided with alternatives to a rat race, through things like education, art, public parks and wilderness areas, more paid holidays, etc.  

      I demand that you prove you're alive.

      by Troubadour on Sun Mar 24, 2013 at 10:05:04 AM PDT

      [ Parent ]

      •  begs the question of why have a private sector (5+ / 0-)
        Recommended by:
        greenotron, Kevskos, Laconic Lib, Chi, Renee

        When all the good stuff is somewhere else?

        I'm trying to imagine a world where all physical goods are the product of someone who was "playing" rather than "working": artists, artisans ... people who do what they do for the joy of expression and experiment.  Where the greatest investments in physical infrastructure are devoted to leisure or at least motivated by something other than profit: altruism, aesthetics, etc.  Where the people held in the highest esteem are the people who are best at creating and playing.

        •  For one, profit is not inherently unproductive. (3+ / 0-)
          Recommended by:
          Kevskos, mike101, J M F

          It's just usually unproductive when treated like an end in itself.  However, with proper regulatory and bargaining parity mechanisms, business can be a highly efficient means of allocating resources, an amplifier for a powerful personal vision that uses profit as a tool rather than an end in itself, and a laboratory for innovation that doesn't have to justify risks to a thousand committees.

          For another thing, the public sector is not dedicated to "playing" - barely at all.  It's simply bureaucratic politics rather than profit that largely drives it.  Play is an inherently anarchic undertaking that doesn't work well in any sort of formalized structure, and yet requires the support of such structures to be possible.  So the key is to have a good balance of the public and private sectors to get the best of both.

          Also, productive "playing" is always small-scale - to really make a difference in the world, you have to be serious and make strategic decisions, and either pursue a political agenda via government or non-profit organization or a business agenda through an industrial venture.

          I demand that you prove you're alive.

          by Troubadour on Sun Mar 24, 2013 at 10:58:05 AM PDT

          [ Parent ]

        •  Who will make the sewer pipes? (5+ / 0-)

          There are some things that some people will make for free. Software is a big one on the list. Mechanical stuff. Furniture. Art. Music. Pottery. Limited quantities of food.

          But there are other things that we depend on that simply aren't 'fun' to make. For anyone.

          Most mass-production jobs could probably be offloaded onto robots eventually, but we're not there yet.

          "Let’s just move on, treat everybody with firmness, fairness, dignity, compassion and respect. Let’s be Marines." - Sgt. Maj Michael Barrett on DADT repeal

          by kyril on Sun Mar 24, 2013 at 02:16:54 PM PDT

          [ Parent ]

          •  who should have to make sewer pipes? (0+ / 0-)

            Who are you OK with doing the work that you don't want to do?

            I don't think that anybody should have to work in the sewer; it's the only ethical position to take if I don't want to work in the sewer myself, otherwise I'm left arguing that it's good enough for some people.  The consequence of that is that I need to develop alternatives to the sewer rather than putting lipstick on the pig of sewer work.

            •  No one should have to work in a sewer, but... (1+ / 0-)
              Recommended by:

              once bargaining parity is established, there's no reason there would be a shortage of people willing to do it for the likely very high wages and benefits they'd get.  Pay people enough, and a job does become consensual no matter how awful.  If prostitutes were paid $50,000 per blowjob, people would be abandoning law careers and office manager positions to become hos.  

              Business doesn't distinguish between making money and taking money.

              by Troubadour on Sun Mar 24, 2013 at 04:13:45 PM PDT

              [ Parent ]

            •  Call me when... (3+ / 0-)
              Recommended by:
              Troubadour, kyril, Sparhawk

              ...and only when, you've developed these alternatives.

              But until that happy day, we need people to work in the sewers. The only ethical way to get them to do it is by offering them cash.

              •  And not just sewers (2+ / 0-)
                Recommended by:
                eztempo, Troubadour

                HVAC systems.
                Fixing downed power lines.
                Hell, farming.

                All unpleasant activities, all necessary. All need someone motivated by money to do them.

                (-5.50,-6.67): Left Libertarian
                Leadership doesn't mean taking a straw poll and then just throwing up your hands. -Jyrinx

                by Sparhawk on Mon Mar 25, 2013 at 09:29:22 AM PDT

                [ Parent ]

          •  . (1+ / 0-)
            Recommended by:

            unfortunately for the globalists and the "titans of industry" robots won't be buying any products ever.

            "History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling the money and its issuance." -James Madison

            by FreeTradeIsYourEpitaph on Sun Mar 24, 2013 at 03:05:21 PM PDT

            [ Parent ]

    •  And this choice is Corn syrup flavored and hidden (3+ / 0-)
      Recommended by:
      Troubadour, Laconic Lib, Kevskos

      the "die" part is all candy coated and disguised to make the bitter pill go down an oblivious esophagus... and the hints that all is not well are easily blamed on the scapegoat du jour via the wholly owned fear-mongering mouthpieces .

      Any dissenters will be guaranteed to be howled down by the fearful enablers of the invisible choice dictators... enablers who cling to what has been sold to them as a great lifestyle that they have a say in... but one that is in danger of being taken away by undeserving "others"...

      Work or die is even absorbed by these pawns and spewed out wishing death on those labeled undeserving... those who apparently are not "working", i.e. buying into the lie entirely.

      Pogo & Murphy's Law, every time. Also "Trust but verify" - St. Ronnie (hah...)

      by IreGyre on Sun Mar 24, 2013 at 10:53:52 AM PDT

      [ Parent ]

    • want the fruits of someone else's (1+ / 0-)
      Recommended by:

      labor, but don't actually want to labor yourself?  Super - you and everyone else.  

  •  great diary (7+ / 0-)

    Your diary had me imagining the military as our current market model. Decisions are top-down, unquestioned, not driven by consumer consensus or valid consumer input. This hierarchical model is so deeply  embedded in our economic culture that its problems go unchallenged.  Maybe the way to facilitate more critical analyses is to begin changing businesses from the ground up. Successful cooperative businesses could be a way to gain more visibility for alternate economic models.

    Richard Wolff was on Bill Moyers explaining his vision of  democraticly run cooperative businesses.

    •  Veblen would argue that's the whole point (8+ / 0-)
      Your diary had me imagining the military as our current market model. Decisions are top-down, unquestioned, not driven by consumer consensus or valid consumer input. This hierarchical model is so deeply  embedded in our economic culture that its problems go unchallenged.
      Production of goods has never really been a priority for capitalism in that it's always been happy to let millions of people go without things, even necessities like food, shelter, etc.  People who were truly motivated to sell things would look at the poor and see a gigantic untapped market: "Look at all those people who'd buy stuff if only they could."  

      But capitalism is about profit, with selling stuff only one of the many ways to make profit ... and not necessarily the best one.  And besides, what truly matters to the ruling class is that they be the ruling class.  If you're sitting in the corner office raking in the dough but all your decisions are made for you by the needs and desires of employees and customers, who's really in charge?

      •  Monopoly (8+ / 0-)

        Monopolies maximize their income by producing less of the things they control.  That insight tells us a great deal about the economy in which we currently live.

        •  Yes. Yesterday I was listening to a representative (3+ / 0-)
          Recommended by:
          Troubadour, salmo, dfarrah

          of the plywood manufacturers saying that they can't crank up their production to meet current demand for several years. I thought to myself, well why would they?

          Poverty = politics.

          by Renee on Sun Mar 24, 2013 at 03:06:10 PM PDT

          [ Parent ]

          •  They have to eventually. (3+ / 0-)
            Recommended by:
            Renee, salmo, dfarrah

            Ultimately the amount of profit they extract through monopolism makes the industry attractive to innovative new entrants who could offer lower prices and still make massive profit margins.  But that's only over the long-term, so Big Business plays this game where they go through cycles of price gouging followed by undercutting to make sure no competitors can enter the market.  

            The entire nation of China plays this bullshit game with the whole world, most recently by churning out a vast oversupply of solar panels in order to destroy solar manufacturing in every other country.  After they've swept away their competitors, then they start jacking up the prices and gouging everyone until the cycle repeats.

            Business doesn't distinguish between making money and taking money.

            by Troubadour on Sun Mar 24, 2013 at 04:18:52 PM PDT

            [ Parent ]

    •  It would be great for creative minds (3+ / 0-)
      Recommended by:
      Kevskos, Chi, kyril

      to come up with solutions to some of the weaknesses of democratic or distributed business models.  For instance, they tend to be most effective at a relatively small size, leaving them vulnerable to the same predations that Big Business uses against small business in general.  It's also difficult to see how they could compete on a large scale where prices matater without some of the measures I advocate forcing the whole industry to negotiate on equal terms with labor and consumers.

      I demand that you prove you're alive.

      by Troubadour on Sun Mar 24, 2013 at 10:12:05 AM PDT

      [ Parent ]

  •  It's my sense that the theory of economics (7+ / 0-)

    (not the practice) was invented by people lacking in a sense of time and that accounts for why the sequence in which events happen is of no concern to them.
    Otherwise, it would not be possible to assume that someone who has something in his possession (for sale or use) has the same amount of information about that thing (good or service) as a person seeking to acquire that good or service.  The one who has (experience) has more knowledge than one who gets (expects). But then, even though that occurred to me a long time ago, it was only recently that I realized that there are people who do not know anything. They believe. And there's a big difference, much of it related to the sense of time, order and sequence. Some people exist in an ineffable present where past, present and future are just a jumble of isolated incidents with no causal relationship.

    These people make demands, have been making demands ever since they were born, and when their demands are satisfied conclude that their demand was the prompt that produced the result -- as if the teat gave milk because the suckling sucked.

    John Kenneth Galbraith explained that the problem with economic analysis is that the models are all static and are incapable of tracking a dynamic system, which is what the economy is.  He compared economists not being equipped to do what weathermen are attempting and doing for limited periods of time. But, I think the problem is not with not having the skills to model a dynamic system, but with economists not even seeing that there is change going on because, of course, change is not visible. Change happens in the interstices, in the space between point A and B, or not. If they can't see it, how can change be predicted?

    I'm tempted to compare how some people see things to seeing the 30 frames per second, which make up a moving picture, as isolated still pictures and never getting how they are changing the scene in front of one's eyes. It isn't that the frames move too fast; it's that some people don't see the progression. It may also be similar to people who are face blind and don't recognize other people's facial features. (My mother, I discovered late in her life, did not recognize pictures or images of herself. She recognized her own voice, but not her image in a video).
    Not tracking sequence, of course, makes it virtually impossible to know HOW things are done or happen. It's all magic.

    We organize governments to deliver services and prevent abuse.

    by hannah on Sun Mar 24, 2013 at 09:34:13 AM PDT

    •  assuming economics wants to predict vs justify (7+ / 0-)

      I've gotten to the point where I simply assume that most economics is cynical, even if the economists themselves are true believers.  Economics seems like its goal is to take a man-made system and endow it with the inevitability and "beyond good and evil"-ness of a physical phenomenon ... like the weather.  You can't change it, only adapt yourself to it: seize the opportunities when they come and always be ready to sit and wait for the storms and the generational droughts to blow over.  It's the mentality of people who are not in control, to the point where they don't believe we should be in control.

      In the real world, there is no such thing as equilibrium: only growth or decay.  From individuals, to populations, to storms, to businesses: you're either growing or dying - anabolism or catabolism.  The closest thing you'll ever get to equilibrium is a very long and very flat business cycle, and there's no guarantee of that without external structural support.  Add the fact that people are not rational value-maximizers - at least not to the extent that value = earning power - and I've just falsified 99% of economics.

      •  There is a genuine scientific discipline (4+ / 0-)
        Recommended by:
        hannah, Kevskos, kyril, scott5js

        of economics, but it's covered in so many barnacles of corrupt politics and market fundamentalist religious ideology that you have to really look for it.

        Of course, ultimately it does boil down to thermodynamics, but we do have choices about what happens to the energy as it flows from hot to cold - it doesn't have to go in a straight line from nature into the bank accounts of the richest 50 people on Earth.

        I demand that you prove you're alive.

        by Troubadour on Sun Mar 24, 2013 at 11:03:17 AM PDT

        [ Parent ]

        •  I believe money behaves gravitationally (3+ / 0-)
          Recommended by:
          greenotron, Troubadour, Kevskos

          I think it's a good analogy for how there can be multiple sustainable piles of money of greater or lesser size, and how these piles can form themselves into larger systems, exchanging energy (unequally) and eventually being consumed by ever larger but progressively less mobile piles of money.  By analogy, the 50 richest people in the world are like the Great Attractor: able to exert a gravitational pull on multiple galaxy-sized piles of money: entire industries and the economies of entire nations.

          The thermodynamic analogy would have money gradually dispersing itself equally into all pockets, which is manifestly not what's happening.  Figurative heat death would occur when everyone has some, but no-one has enough to make more (i.e. profit).  But even profit may be unsustainable because by analogy to energy and entropy, entropy can only be decreased locally at the price of greater entropy in the system as a whole.  You can only have more money if someone else has less, whether by charging more than your product is worth and/or paying your people less than their labor is worth.

          Market failure in the gravitational model is basically a black hole; the attractive force of a sufficiently concentrated pile of money is so great that it exerts a greater force on other nearby money than would the same amount of money in a less concentrated form.  This infernal engine can create money, but a big chunk of that new money just goes right back into the hole.

          •  My physics analogy creates confusion because (1+ / 0-)
            Recommended by:

            of the differing roles of matter and energy.  Suffice it to say that there is indeed a natural tendency for resources to travel by the most efficient possible way from their origin into the control of the wealthy few, and that not only do we have the right and the ability to divert that process, but to reverse it once it reaches that destination.

            I demand that you prove you're alive.

            by Troubadour on Sun Mar 24, 2013 at 12:01:17 PM PDT

            [ Parent ]

            •  which is the public sector's job (4+ / 0-)
              Recommended by:
              Troubadour, Kevskos, Chi, mike101

              Absent an effectively unlimited external source of "free energy" (the Sun, the printing press, debt-fueled growth), all thermodynamic systems are unsustainable: they'll eventually exhaust a fixed amount of energy.

              The economy needs a strong redistributive mechanism to send the money back down to the base of the food chain to keep the whole thing going.  Tax profits, tax "excessive" income, tax unproductive investments (i.e. making money from money), and then spend that money in ways that will keep the supply-demand cycle running strong: enabling consumption, but also investments in productive capacity that actually do grow the proverbial pie.

              All of which is quite beside the point I was trying to make in my original comment, which is that maybe people want more out of life than to work and buy things.  It's the difference between an animal existence of physical survival versus a human existence dedicated to some higher goal (even if it's only pleasure), with survival as a mere byproduct.  You can argue that we achieve this collectively by organizing ourselves into nations and corporations, but I think that only the rich are able to achieve it individually, while the rest of us are really only able to do our jobs.

              •  Yes, the public sector needs to perform (3+ / 0-)
                Recommended by:
                Kevskos, mike101, Visceral

                this redistributive function through progressive taxation and provision of services like education and healthcare.  However, as we've seen, it's just not practical for the government to keep up with all the infinite ways large and small that business devises to screw people over on a daily basis, so for that we need to reorganize the private sector so that people are better able to defend themselves against economic power.

                What you're talking about doing something more with life, that's kind of outside the realm of what can be addressed by politics - all we can do is try to find the right combination of both public and private mechanisms that give people the most freedom and opportunity to be themselves.  The internet helped a lot toward that goal, but obviously we need to bring the same democratizing influence out into the hard world.  That requires certain practicalities, like bargaining parity, that have nothing to do with whatever people ultimately choose to use their wealth for.  But we can say it would probably lead to more paid time off, or at least make it more of an option for people willing to make it a priority.

                I demand that you prove you're alive.

                by Troubadour on Sun Mar 24, 2013 at 12:41:06 PM PDT

                [ Parent ]

          •  Money is worthless and we can take turns (4+ / 0-)
            Recommended by:
            Troubadour, Kevskos, Chi, happymisanthropy

            using it, just like we use the letters of the alphabet to write. My use of the letters does not reduce anyone else's ability to use them, as long as they know how. Dollars are symbols of value owed, just as written words are symbols of thoughts spoken or not. The symbols are real, but their value is immeasurable. Like an inch.

            We organize governments to deliver services and prevent abuse.

            by hannah on Sun Mar 24, 2013 at 12:17:10 PM PDT

            [ Parent ]

            •  money is an asset in its own right (3+ / 0-)
              Recommended by:
              Troubadour, Kevskos, mike101

              People who have more money can do more things than people who have less of it.  Just like someone who eats one bowl of gruel a day can never become either a bodybuilder or a fatass on a scooter, someone who has very little money is simply not able to do much of anything, regardless of their intentions or abilities.  What little calories they take in are entirely devoted to staying alive, not to growth, and the margin between maintenance and atrophy from caloric deficiency is very thin.  It's the same with money and whether it's an individual, a country, or a business.

              There is only a finite amount of money in the world in much the same way that there's only a finite amount of value in the world: from resources like energy and metals to the brains, hands, and mouths of people, there's only so much that can be done even if money were no object.  But it's increasingly difficult to change that side of the equation because the supply of money is being artificially restricted by paralyzed banks and contractionary fiscal policy, being monopolized by people who already have more than they could ever spend productively, or being outright denied to people on the grounds that because they've never gotten a lot to eat, they're too physically and/or mentally stunted to do a lot with it.

              Too much money can be a bad thing; no matter how many hours a week you spend in the gym, if you're eating too much more than that, you're still going to get fat.  Printing money and/or issuing debt beyond actual economic activity will just raise prices, and if you don't raise wages and/or issue more debt to keep pace, you'll end up breaking the economy.

              •  True, the money supply is being artificially (0+ / 0-)

                restricted, rationed, in hopes of maintaining its use as an abusive tool. However, it doesn't have to be that way. In cultures where people's access to sustenance is not restricted by private property rights, they can sustain themselves quite well, as long as thieves don't take what they harvest for themselves.

                Property rights are a major culprit. But, I won't go into that now.

                Monetary certificates differ little from marriage certificates. The relationships they symbolize and formalize with public recognition can and do exist regardless of the certification.
                We owe sustenance to the next generation because the prior generation sustained us. That some people reject that obligation doesn't negate it. It just means that some people are self-centered anti-social beings. Probably got born that way. Maybe they were damaged in utero or on the way out.

                We organize governments to deliver services and prevent abuse.

                by hannah on Sun Mar 24, 2013 at 02:08:00 PM PDT

                [ Parent ]

                •  How can there be thieves without (1+ / 0-)
                  Recommended by:

                  property rights?  Isn't theft, by definition, taking that which belongs to another?

                  •  I don't think there has to be a claim to ownership (0+ / 0-)

                    for thieving to occur. Some critters just sneak what they want. I tend to contrast thievery with exchange or sharing. Thievery is the way of the predator. When humans do it, it's really primitive behavior, especially since language makes it possible to inquire whether anyone else has a claim.

                    Rights, of course, have to be respected to even exist.

                    Are rights assigned or claimed?

                    We organize governments to deliver services and prevent abuse.

                    by hannah on Sun Mar 24, 2013 at 03:24:12 PM PDT

                    [ Parent ]

                    •  rights are a function of power (0+ / 0-)
                      Are rights assigned or claimed?
                      A powerful person both assigns rights to less powerful people, as well as claiming rights against less powerful people.  A group of less powerful people claiming rights against a powerful person is attempting to increase its power and use it to reassign rights.  

                      For most of human history, the only claim to rights (implicitly the rights of the aristocracy) that society respected was the fact of exercising them.

            •  My physics analogy for money would be (3+ / 0-)
              Recommended by:
              Chi, Kevskos, Visceral

              force-carrying particles, like photons.  They have no mass, so they have no value as a particle despite partly behaving like one.  Rather, their importance stems from what they transmit - energy.  Money is itself, in fact almost literally, a means of transmitting energy, since energy is the utmost foundation of an economy.  Of course, what you do with it once you have it determines whether the economy that results is a highly-evolved one (like Norway) or a shallow one (like the UAE).

              I demand that you prove you're alive.

              by Troubadour on Sun Mar 24, 2013 at 12:46:11 PM PDT

              [ Parent ]

              •  I guess I see money as more like energy itself (1+ / 0-)
                Recommended by:

                In a society that uses it, money is the the thing that allows economic activity to take place at all, since in the absence of money, it doesn't really matter what could take place: it won't.  A system with lots of money flowing around will be dynamic, while a system with little money flowing (whether there's little money period, or because it's locked up in physical assets, or because it's monopolized and its movements artificially restricted) will be much less dynamic.  The UAE's economy might be shallow, but there's a lot of money there; alternatively, you can have a deep economy without a lot of money - i.e. a complex but poor subsistence society.  E=mc2 is like saying that physical assets are worth something in and of themselves, and can be converted into money, but that's only useful if you have physical assets in the first place, and you still need to input energy from outside in order to make the conversion.

                Poverty is like a state of high entropy; there's little free energy (i.e. cash) available to drive economic activity, and in the worst cases, the assets themselves (including people) have little value, if only because it takes greater inputs of energy in order to make them valuable.

                Perhaps we're stumbling over the difference between money in the abstract versus its many physical forms.  I think that no matter what form your money takes - cash, gold, stocks and bonds, antiques, etc. by analogy to chemical, kinetic, electromagnetic, etc. energy - if you don't have very much of it, you're pretty much stuck.

        •  The one thing (4+ / 0-)

          that really stuck with me from my first economics class I took back in 1981 was his assumption that economist must make and not forget.  

          Economists must assume that all players are making rational decisions to study economies.  Economists must never forget that most players will never make rational decisions.
        •  Keynes insisted economics must be a moral (1+ / 0-)
          Recommended by:

          science. Devoid of morals economics is simply justification for getting the most amount of gain to the most greedy and reckless among us.


    •  This is sort of what Stephen Wolfram meant (1+ / 0-)
      Recommended by:

      when he was articulating his algorithmic science: He argued the modern approach of scientific analysis using equations was running into inherent limits, and that the next step needs to be understanding the universe through computational algorithms.

      I demand that you prove you're alive.

      by Troubadour on Sun Mar 24, 2013 at 10:34:41 AM PDT

      [ Parent ]

    •  The theory of economics (6+ / 0-)

      was built around the exchange of money and goods -- things exchanged between people. As originally conceived, it didn't include people within the category of "goods." Now, somehow, it does. Not only that, but in the context of the labor market, we're somehow supposed to accept as given that one party can be both the seller of the good and the good itself. How can that not screw up the equation?

      "The great lie of democracy, its essential paradox, is that democracy is the first to be sacrificed when its security is at risk. Every state is totalitarian at heart; there are no ends to the cruelty it will go to to protect itself." -- Ian McDonald

      by Geenius at Wrok on Sun Mar 24, 2013 at 10:38:23 AM PDT

      [ Parent ]

    •  Yes, Human time sense is limited -shorter & longer (4+ / 0-)
      Recommended by:
      Troubadour, NoMoreLies, Kevskos, Simplify

      time frames are either too fast to register with our senses or too long term for most of us to comprehend the scale and inexorable nature of it mentally. Things appear unchanging when they are changing too fast for us to see because they are too small for unaided eyes or changing so slowly they seem permanent.

      So we are condemned to inhabit the same wide slow economic and generational swings, empires, belief systems, recurring patterns of corruption and exploitation again and again... with the oldest becoming either too jaded or too fearful or too forgetful or weak to do enough to smooth out the oscillations enough.

      Like the apparently flat earth we seem to inhabit an unchanging landscape with climate change or huge economic factors are just as inconceivable as a round world used to seem.

      As Edward Teller (hiss) once said about a parallel to this:

      .... The extinction of the human race will come from its inability to EMOTIONALLY comprehend the exponential function."

      But I would add that for most it is un-comprehended intellectually as well... So it is that moving, evolving, non-static things tend to exponential outcomes or elaborations that are off the awareness map... seeing the whole process and all the main alternate outcomes... the gestalt, aware of the full forest and its ecology instead of being experts on isolated freeze frame trees allows much more than accidental survival and instead allows conscious avoidance of destructive extremes...

      But the myopic money grabbers who control our economic landscape only see immediate choices to grab or be thwarted in a limited static set of options... and act to enforce the immediate grabbing and to control the limited set of options they are aware of.

      Pogo & Murphy's Law, every time. Also "Trust but verify" - St. Ronnie (hah...)

      by IreGyre on Sun Mar 24, 2013 at 11:22:47 AM PDT

      [ Parent ]

  •  The problem's a bit subtler than (4+ / 0-)
    Recommended by:
    Troubadour, Sychotic1, Kevskos, Egalitare

    just one of unequal bargaining power. I think the problem boils down to two problems: The necessity of a transaction and a related valuation problem.

    Consider: I might do business with a monopolist. Assume all Hollywood becomes dominated by 20th Century Fox, for example. If I want to buy a Hollywood flick, I must buy from them. This would seem to be a highly disadvantageous position for a customer, but appearances can be deceptive: It's easy for me not to buy a Hollywood flick, and I lose relatively little utility if I do not: There are still books, computer games, non-Hollywood movies etc. to amuse me. On the other hand, I can't really substitute anything else for food.

    And this brings us to a related problem. A trite example which demonstrates the gains from trade is the sale of a used car: John values it at $3000, Sophie at $4000. The sale - a shift from a lower- to a higher-value use - nets a $1000 surplus. A reasonable conclusion is that the gains from trade will be distributed evenly, so the price will be $3500, giving John a $500 monetary surplus and Sophie a $500 subjective surplus.

    The problem lies in determining the value the object of the transaction has for a party in the transaction (why does John value the car at $3000 and not more or less?). If you're poor, you might treasure something dearly, subjectively far more than an equivalent wealthy person, yet your lower standard of living might mean you will be willing to sell that object for a relatively lower price to pursue a goal you value more highly.

    Take an example: Prostitution. It's far more probable that poor women will prostitute themselves than wealthy women, and it is safe to assume a poor woman is on average no less protective of her sexual integrity than a wealthy woman. The reason why the poor prostitute themselves even in this case is that selling themselves might be the only way to achieve goals they value even more highly, such as not starving, or being able to attend college. A wealthy woman who values her chastity equally will not be forced into such a trade-off.

    Now, from a narrow market-based perspective, such a transaction is clearly advantageous to the woman involved: It allows her to pursue a goal she values more than her sexual integrity. That argument is true... but it obscures an important point: The gains from trade do not mean the woman's position is acceptable. It does not mean that a state of affairs where prostitution is for some the only means of, say, survival or getting an education, is good or acceptable.

    In short, we should not assume that individuals are completely free to transact or not to transact and we shouldn't let the gains from trade distract us from examining (and striving to improve) social conditions. Being relatively better off after a trade than you were before does not mean you are well-off.

    Iuris praecepta sunt haec: Honeste vivere, alterum non laedere, suum cuique tribuere. - Ulpian, Digestae 1, 3

    by Dauphin on Sun Mar 24, 2013 at 09:50:31 AM PDT

    •  Good points. I would somewhat quibble (4+ / 0-)
      Recommended by:
      Kevskos, Chi, Dauphin, YucatanMan

      with the idea that undesirable transactions undertaken through necessity are ever beneficial, even in the short-term.  A woman is not better off after selling sex than before: She had food and a presumably ordinary self-image, and now she has food and that self-image is tarnished by a decision forced on her by the marketplace.  In other words, people forced to engage in disadvantaged transactions always lose out in the balance, and the longer they are disadvantaged, the more total the loss.  Ultimately a person is reduced to subsistence, if not explicit forced labor in prison because they had to commit crimes.

      I demand that you prove you're alive.

      by Troubadour on Sun Mar 24, 2013 at 11:09:42 AM PDT

      [ Parent ]

      •  I don't think so. (3+ / 0-)
        Recommended by:
        misslegalbeagle, Troubadour, Sparhawk

        Let's consider a similar example: A woman sells herself so her children will not starve. Is she better off than before? Certainly. In fact, all the parties to the transaction gain: Her customers obviously value her sexual favours more than the money they paid for them, otherwise they would not hire her. She obviously values her children not starving (and hence the money used to ensure they do not) more than her sexual integrity and her self-image (assuming she hasn't miscalculated regarding her preferences).

        Because of this, she doesn't lose out, on balance. She gains. In fact, the net welfare of every person involved has increased: That of her clients for obvious reasons, hers because she values the cash she gains more than seeing her children suffer, and the children's because they receive more nourishment.


        The fact that the woman in question has gained does not really mean much. She probably still suffers, and very much at that. After all, "being marginally better off than seeing your children starve" still means you may have a terrible life, and is not exactly a ringing endorsement of Teh Power of teh Free Market.

        Most of all, the fact that a (probably small) gain results from such transactions does not mean that a situation in which anyone is forced to even seriously consider such a trade-off is acceptable. The fact that such transactions even take place and that such trade-offs have to be seriously considered are, in my view, a sign that something has gone terribly wrong with society. The most you can say about the net gain from the market is that it's an argument (and a very good one) against criminalising prostitution, not for singing praises of the market's efficiency nor for dismantling social programmes.

        Iuris praecepta sunt haec: Honeste vivere, alterum non laedere, suum cuique tribuere. - Ulpian, Digestae 1, 3

        by Dauphin on Sun Mar 24, 2013 at 02:46:02 PM PDT

        [ Parent ]

        •  But the only reason she has to sell herself (0+ / 0-)

          is that some circumstance has changed for the worse - a change imposed on her externally by market forces not under her control.  The fact that she is forced to relinquish something she had previously just to maintain existence is a net loss.  

          This is analogous, in middle-class terms, to having to sell your house: Of course you're better off selling your house than if you don't sell your house under the same circumstances and it's just seized, but you certainly aren't better off than before the external factor forced you to sell it.  That's why none of this is consensual.  

          It's tantamount to kidnapping someone, dropping them in the middle of a desert, and then offering to sell them water if they'll sign themselves into indentured servitude.  Yes, within the limited context of the rigged choice, you are better off agreeing than not agreeing, but you are not better off in the full context - you have been robbed, and being robbed never leaves the victim better off.  It never provides net value in return.  You start off the robbery alive with $20 in your pocket, and retain your life with an empty wallet - no gain there.  

          Business doesn't distinguish between making money and taking money.

          by Troubadour on Sun Mar 24, 2013 at 04:28:26 PM PDT

          [ Parent ]

    •  The power of poverty distorts and disrupts (3+ / 0-)
      Recommended by:
      Dauphin, Troubadour, lostinamerica

      other values.  

      It comes down to the hierarchy of needs:

      First, food, clothing, shelter.  All else can wait. All else is distorted or twisted if you cannot eat. What would you do to survive?  To avoid freezing to death?

      "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

      by YucatanMan on Sun Mar 24, 2013 at 03:11:15 PM PDT

      [ Parent ]

  •  Do this or die is in no way consensual (11+ / 0-)

    Starvation and exposure are fatal ailments.

    "Til you're so fucking crazy you can't follow their rules" John Lennon - Working Class Hero

    by Horace Boothroyd III on Sun Mar 24, 2013 at 09:56:05 AM PDT

  •  In five words (9+ / 0-)

    "Libertarianism without equality is tyranny", as a dear friend says.

    Freedom isn't free. Patriots pay taxes.

    by Dogs are fuzzy on Sun Mar 24, 2013 at 10:04:33 AM PDT

  •  Thank you (4+ / 0-)
    Recommended by:
    Troubadour, Kevskos, Renee, Ray Pensador

    Very much for this educational discussion.

  •  Temp Services (5+ / 0-)

    You know, when temp services began, the made noises to workers as if they were ex temporaneous labor agents working to the benefit of wage and benefits. Every time I went to work for one, I got a packet explaining how temp services were acting as a major negotiator between me and the ruthlessly unfair employers.

    It was an illusion of short duration. They are, in fact, a labor pool working as an independent depression on wages, as they take one third of a low end worker's wage and fail to provide benefits. They are, needless to say, a scam and a rather wicked one.

    However, it is still possible for temporary services to do what they lied about doing at the outset. It would require a co-op set up, but it is possible.

    Everyone is innocent of some crime.

    by The Geogre on Sun Mar 24, 2013 at 10:47:43 AM PDT

  •  You are describing old fashioned monopoly power (6+ / 0-)

    When monopoly (or oligopoly) power is allowed the people holding these powers effectively have the power to tax the rest of us while offering nothing in return.  One of the many fallacies of conservative economics is to just ignore monopoly power.  It is a government crime of omission.  Yes, too little government action causes the economy to malfunction and too little government action interferes with a free economy.  A shocking fact to our conservative friends.

    An important solution is to shift the taxes onto monopoly power of all kinds and away from labor.  Such a tax would be independent of income and rest annually on the market value of the monopoly.  The shift would greatly equalize bargaining power because the passage of time would put strong pressure on the monopolist.  

    I am not a huge fan of just creating a counter-monopoly in the form of unions although such measures would be better than doing nothing.  

    Also, we would be wise to note the limits to the "supply and demand" bromides.  At the macro level they can be quite stupid arguments if people just stop and think.  The supply of raw materials in the earth is absolutely fixed.  We might use those raw materials wisely or foolishly but no one can change the real supply.  Policy changes can change the effective supply but not the physical supply.  

    Likewise, "supply and demand" has nothing to do with the general level of wages.  The differences in market value between one type of labor and another are affected by relative supply and demand of labor types.  But the general level of wages for all wage earners is affected by entirely different forces unrelated to "supply and demand".  David Ricardo had the essential rules worked out for the general level of wages as a fraction of total production back in the 1820's although most people would have a hard time mapping his agricultural examples to modern times.  The same general rule about access to resources is key.  

    The Long War is not on Iraq, Afghanistan, or Iran. It is on the American people.

    by Geonomist on Sun Mar 24, 2013 at 11:04:38 AM PDT

    •  But taxation alone wouldn't reduce the inherent (2+ / 0-)
      Recommended by:
      Chi, Kevskos

      advantages of business over workers and consumers, because even without a monopoly, there are a lot more individual people acting alone to seek jobs and buy goods and services than there are businesses providing them.  Whether the unfair advantage is egregious, as in an effective monopoly, or just a few cents per transaction, the net result over the long-term is a transfer of wealth - a bleeding of the overwhelming majority of people.  

      It is admittedly complicated to calculate what constitutes "parity" in trying to relate a business to a labor pool, but hardly as complicated as what Wall Street does on a daily basis to screw people.

      I demand that you prove you're alive.

      by Troubadour on Sun Mar 24, 2013 at 11:50:52 AM PDT

      [ Parent ]

  •  I want to Recommend but the option is absent... (1+ / 0-)
    Recommended by:

    maybe it is just me... need to reset or it is some internet glitch... I can still rec comments but not diaries...


    DKos Server/software issue??

    Pogo & Murphy's Law, every time. Also "Trust but verify" - St. Ronnie (hah...)

    by IreGyre on Sun Mar 24, 2013 at 11:26:49 AM PDT

  •  One of the most troubling results of the current (5+ / 0-)

    bargaining disparity:  business apologists, political conservatives who pontify on labor, and garden variety Republicans don't seem to think it problematic at all that millions of US jobs have been sent overseas and that the service sector is creating the greatest number of jobs-- badly paid, contingent jobs which cannot sustain families, not to mention individuals in many cases.

    The national discourse on jobs causes my brain to explode and my mind to stultify.  People who in one breath decry unions and the bargaining power of labor and who promote the offshoring of jobs so as to increase corporate profits, in a second breath demand of the President "where are the jobs?", as though the former had nothing to do with the dearth of jobs.

    The national discourse on barganing disparity in all kinds of markets is even worse.  

    That's one more thing to add to my long list of small problems. --my son, age 10

    by concernedamerican on Sun Mar 24, 2013 at 11:29:48 AM PDT

  •  meanwhile in political reality world... (5+ / 0-)

    we have a Democratic party that has been co-opted by people who think privatizing things and relying on the market is a better way, a third way, of doing business so expecting anyone within our party to champion your good ideas is silly.

    I sing praises in the church of nonsense, but in my heart I'm still an atheist, demanding sense of all things.

    by jbou on Sun Mar 24, 2013 at 11:41:24 AM PDT

    •  I'm in our party, and I'm championing these ideas. (5+ / 0-)
      Recommended by:
      Chi, Renee, mike101, scott5js, Jeff Simpson

      Presumably most of the people commenting supportively here are also Democrats.  Next time there's a contested primary, ask the candidates about this.  Hell, ask the people who are in office now.  Ask Republicans in office, just to remind them that we're not okay with being robbed.  And maybe people who are skilled with organized activism might take a renewed interest in this particular subject, maybe think about ballot initiatives or organizations that do certain relevant things.  

      I demand that you prove you're alive.

      by Troubadour on Sun Mar 24, 2013 at 12:11:52 PM PDT

      [ Parent ]

  •  the reality of bargaining parity (7+ / 0-)

    Think of how many times in your life you are engaged in some sort of transaction and you are handed something to sign. In almost every case these documents are take-it-or-leave it contracts of adhesion where you have no opportunity to negotiate terms. The terms of the deal are: you sign the paper or you don't get the good, service, job, or whatever is in question.

    Even better, the person (when there is a person - unlike with the EULA that you have to agree to to use anything computerized) who is handing you this thing to sign almost never has the authority to negotiate terms with you. For the average person this makes for a pretty miserable economic life when you stop to think about it. Commercial entities are constantly using brute economic force to dictate terms to their customers and you don't really have much recourse. If you don't acquiesce to these contracts you are not going to have a checking account, a home mortgage, a telephone, credit card, etc.

    All that said, to some degree I understand the logic behind it. It would be insane for the phone company to have 10,000,000 different contracts with its individual customers. If we are going to have an ecomony based on mass consumption there needs to be some degree of uniformity.

    You don't have to think very hard about it to see that people who live by an ideology where we are all individual actors free to operate in the marketplace are living in a fantasy world.

    Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. - Groucho Marx

    by Joe Bob on Sun Mar 24, 2013 at 01:56:34 PM PDT

    •  Yes, and you raise an important issue. (6+ / 0-)

      If the bank, phone company, cable company, etc. are going to dish out boilerplate contracts to 10 million people, then the terms of those contracts need to be negotiated by representatives of those 10 million people in concert - not just shoved in the face of 10 million powerless individual consumers to take or leave agreements that overwhelmingly benefit the company at their expense.

      Business doesn't distinguish between making money and taking money.

      by Troubadour on Sun Mar 24, 2013 at 02:18:45 PM PDT

      [ Parent ]

  •  Communication is only possible... (2+ / 0-)
    Recommended by:
    Ray Pensador, Troubadour

    ....between equals. If one or the other sees the other as superior, communication will not take place. That, in a nut shell, is where the bargaining begins and also explains why the guy at the top of the corporation has no idea what is happening at the bottom of the pyramid in the corporation. This is also true of governance and the American people have never had the bargaining power of the lobbyists since I've been alive.

    Regulated capital serves the people, unregulated capital serves itself.

    by Alumbrados on Sun Mar 24, 2013 at 02:57:27 PM PDT

  •  Regarding your "Brainstorming Solutions:" (2+ / 0-)
    Recommended by:
    Troubadour, dfarrah

    You wrote very eloquently in describing the actual state of affairs when it comes to the imbalance in bargaining power between the rich and powerful and the citizenry at large.

    Your brainstorming solutions are right on point also.

    But here's what I consider to be the elephant in the room which often goes unmentioned: The biggest challenge is not to elucidate on the details of a rigged system, nor to propose sensible solutions.

    That would work if everybody involved was acting in good faith.  The emerging plutocratic class in this country has no interest in considering sensible or fair solutions to these issues.  They have no incentive whatsoever to do so.

    The one and only way sensible solutions to the rigged system can be applied is if they are imposed with overwhelming force by the citizenry.

    That would require a high degree of unity of purpose and the capability for a large-enough segment of the population to act in concert.

    No amount of reasonable discourse would ever force the ascending plutocracy to relent.

    •  Probably, but all good ideas must begin (1+ / 0-)
      Recommended by:
      Ray Pensador

      with reasonable discourse and proceed with persuasion in order to achieve a good-faith public consensus that is capable of overcoming the myriad obstacles, deceptions, and crimes of bad-faith elements.

      Business doesn't distinguish between making money and taking money.

      by Troubadour on Sun Mar 24, 2013 at 05:06:01 PM PDT

      [ Parent ]

      •  You are absolutely right about that. First a (1+ / 0-)
        Recommended by:

        significant number of people must be able to agree on the definition of the problem we are facing, and that is a big challenge.

        I also agree that it does start with reasonable discourse.  You are doing just that, and this diary is a perfect example of it.

        My particular interest is in trying to find ways of accelerating the process, but I understand that nobody can push the tipping point at which new concepts are accepted, and most importantly, acted on, by the population.

        Either way, I really value the work you do here.

  •  Interesting discussion....but.... (1+ / 0-)
    Recommended by:

    The original letter and the subsequent discussion have danced around the fact that the worker is exploited in the the process of production, and isolated from any say in the distribution of the surplus that his labor produces. All sorts of ideas are put forth to make capitalism more humane, or efficient or in short "better functioning", but they all fall short of their goals, and in the end will be unworkable as has been evidenced since the overthrow of the Feudal Lords, and the inception of capitalism as the new world system.

    Endless human suffering, endless tweaking, and the capitalists always find a way to avoid the constraint and perpetuate the system, precisely because they still control who distributes and allocates the surplus.

    All of the tweaking of the regulations on the market or the attempts of the union to bargain for the best wages possible do nothing to change that fact. Until the workers have a substantial and I would argue majority of the say at the board of directors level, the issues will remain the same, and the exploitation will continue. State regulated capitalism or private capitalism, the exploitation of the worker still continues.

    I have found this discussion interesting, but mis-guided.

    •  I think you've misinterpreted my point. (0+ / 0-)

      My discussion of bargaining parity was not articulated as mutually exclusive to any other solutions that might be pursued.

      Business doesn't distinguish between making money and taking money.

      by Troubadour on Sun Mar 24, 2013 at 05:03:34 PM PDT

      [ Parent ]

  •  FYI (1+ / 0-)
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    Joe Stiglitz and Paul Krugman talk about effecient market theory, Kenneth Arrow, and the invisible hand in this video at 41:05.

    If we abandon our allies and their issues, who will defend us and ours?

    by Bryce in Seattle on Sun Mar 24, 2013 at 06:52:08 PM PDT

  •  Another way of putting the idea (1+ / 0-)
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    that the libertarian paradise is inherently unstable.  Eventually power will be concentrated, and in a libertarian system without a democratic government that can make rules, the concentrated power will be unaccountable.

    There is no perfect system, pure socialism or pure capitalism or any other pure system will not work.  We need a mixed system that can adapt to reality as needed.  Easier said than done, but nothing else has a chance.

    "The trouble with the world is that the stupid are cocksure and the intelligent are full of doubt." Bertrand Russell

    by Thutmose V on Sun Mar 24, 2013 at 09:38:35 PM PDT

  •  Certain Societies/Systems/Governments do (1+ / 0-)
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    make the participation of citizens in the social & political life of the country ...smoother and easier and more meaningfull.  I learned from  living in Belgium and France, that protections for consumers are important.  I saw that strong social safety net programs & policies (good universal health care, free college education, strong solidarity among all the labor unions and all the professions and trades lifted up the disabled, the old, the sick, children and families in poverty) made for a more peaceful and less stressed out life for all workers.  The American people are being exploited by cable companies, internet profiteers & cell phone companies - often at Usory levels compared to our European or Scandinavian brothers and sisters.  And Broadband and other services are faster and more reliable.  The US has a serious problem with infrastructure collapse and deterioration.  It is a disaster waiting to happen on bridges, roads, overpasses, train tracks, airports, city streets and country roads from AK to FL.  Things are literally crumbling - falling down - and there is no political will or leadership to face this.

    Some of us have been pissing in the wind on these issues for decades.  The conservative right in the US, with their "less government is best government" pholosophy- has taken center stage in the US political arena.  No matter that austerity is the absolute worst thing to do at this point in the great recession.  We need government programs along the lines of WPA projects - in which our people are given back some dignity and meaning and pride and self-esteem.  

    Hell, I would go for a one time pmt of $15,000.00 to every adult person in the US who is in the lower 80%.  A Restart button to get something moving - to get things back on track.  They did it with a pittance a couple of times ($200.00)  Why not go big and change American Lives forever?  The US is in a terrible place.  I have little hope.

  •  The freedom to starve (1+ / 0-)
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    You don't have to accept their conditions. You can simply starve.

    ¡Cállate o despertarás la izquierda! - protest sign in Spain

    by gjohnsit on Mon Mar 25, 2013 at 06:29:01 AM PDT

  •  We're bamboozled by analogy. (1+ / 0-)
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    The mental picture conjured by ideological talk of how capitalism works is most often based on the assumption that we're all working and living in a pre-industrial town square marketplace.  A market where barriers to entry -- the ability to set up your own stall and compete -- are low, and there are several purveyors of everything you'd want to select from.

    Of course that hasn't been true of capitalism for a couple of centuries, now, if it ever was an accurate description.  The imposition of that falsehood as to how things work and it's gauzy picture of the fairness of the marketplace and the direct reward of personal initiative is paralysing to any argument for apportioning "market space" by collective, social action.

    The truth of "the marketplace" is an inherit dynamic of capitalism to reduce the number of competitors by various market-based and non-market, nefarious means to a couple- or three providers -- an oligopoly of companies offering a good or service in a "mature" capitalist economy like ours -- that act more-or-less in concert in their mutual interest. Therefore:

    Your options are reduced to agreeing to the terms set by businesses, or else simply doing without whatever is being sold or offered due to the absence of viable alternatives.
    In the political sphere, this is defeat by analogy for our side, since this truth of mature capitalism has to be pointed out and explained every time we try to claim economic fairness for those of us that have to live & work & buy, oh, say health insurance, or an airline ticket.

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