Examining Capitalist Ethos

So here are the traditional values of capitalism as seen by those who regard it as noble - the sort of Way spoken of by Paul Graham, or P. T. Barnum (who did not say "There's a sucker born every minute"), or Warren Buffett:

• Make things that people want, or do things that people want done, in exchange for money or other valuta. This is a great and noble and worthwhile endeavor, and anyone who looks down on it reveals their own shallowness.
• Your competitors are your loyal opposition. Usher them toward oblivion by offering a better product at a lower price, then dance on their graves (or buy them out, if they're worthy). An act of violence, like punching them in the nose, is as absolutely forbidden as it would be to a scientist - violence is reserved for the thuggish lower classes, like politicians.
• Plan for the long term, in your own life and in your company. Short-term thinkers lose money; long-term thinkers get to pick up the remains for a song.
• Acquire a deserved reputation for honesty and reliability - with your customers, your suppliers, your subordinates, your supervisors, and the general community. Read the contract before you sign it, then do what you said you would. Play by the rules, and play to win.
• Spend less than you earn. Keep a cushion for rainy days. Fear debt.
• Pay your shareholders a good dividend - that's why they originally gave you their money to invest, to make more money.
• Don't fiddle the numbers. The numbers are very important, so fiddling with them is very bad.
• Promote based on merit. Being nice to your nephew-in-law will make less money.
• Give someone a second chance, but not a third chance.
• Science and technology are responsible for there being something to trade other than stone knives and fruit. Adopt innovations to increase productivity. Respect expertise and use it to make money.
• Vigorous work is praiseworthy but should be accompanied by equally vigorous results.
• No one has a right to their job. Not the janitor, not the CEO, no one. It would be like a rationalist having a right to their own opinion. At some point you've got to fire the saddle-makers and close down the industry. If you want to reward loyalty, give them money.
• No company has a right to its continued existence. Change happens.
• Investing is risky. If you don't like it, don't invest. Diversification is one thing, but stay far away from get-rich-quick schemes that offer easy rewards with no risk or hard thinking. Trying to vote yourself rich falls in this category.
• A high standard of living is the just reward of hard work and intelligence. If other people or other places have lower standards of living, then the problem is the lower standard, not the higher one. Raise others up, don't lower yourself. A high standard of living is a good thing, not a bad one - a universal moral generalization that includes you in particular. If you've earned your wealth honestly, enjoy it without regrets.
• In all ways, at all times, and with every deed, make the pie larger rather than smaller.
• The phrase "making money" is a triumph in itself over previous worldviews that saw wealth as something to steal.
• Create value so that you can capture it, but don't feel obligated to capture all the value you create. If you capture all your value, your transactions benefit only yourself, and others have no motive to participate. If you have negotiating leverage, use it to drive a good bargain for yourself, but not a hateful one - someday you'll be on the other side of the table. Still, the invisible hand does require that price be sensitive to supply and demand.
• Everyone in a company should be pulling together to create value and getting a decent share of the value they create. The concept of 'class war' is a lie sold by politicians who think in terms of a fixed pie. Any person of wealth who actually, seriously tries to exploit those less fortunate is a bully and a heretic; but offering someone a job is not exploiting them. (Though bribing politicians to pass laws that transfer wealth, definitely could qualify as exploitation.)
• In countries that are lawful and just, it is the privilege and responsibility of a citizen to pay their low taxes. That said, a good billionaire wouldn't ask to pay a lower tax rate than his secretary.
• People safeguard, nourish, and improve that which they know will not be taken from them. Tax a little if you must, but at some point you must let people own what they buy.
• The fundamental morality of capitalism lies in the voluntary nature of its trades, consented to by all parties, and therefore providing a gain to all.
• In countries that are lawful and just, the government is the referee, not a player. If the referee runs onto the field and kicks the football, things start to get scary.
• Unearned gains destroy people, nations, and teenagers. If you want to help, go into the dark places of the world and open stores that offer lower prices; or offer employment to people who wouldn't have gotten a chance otherwise; or invest capital in worthy recipients who others shun. Plow your gains back into the operation, if you like; but if you don't make at least a little money in the process, how can you be sure that you're creating value?
• Wise philanthropy is a privilege and responsibility of achieved wealth.
• Making money is a virtuous endeavor, despite all the lies that have been told about it, and should properly be found in the company of other virtues. Those who set out to make money should not think of themselves as fallen, but should rather conduct themselves with honor, pride, and self-respect, as part of the grand pageantry of human civilization rising up from the dirt, and continuing forward into the future.

Maybe we should make a thread deconstructing how these values work, because, on their face, they are awesome, and if capitalists actually behaved like this, well, I would feel very differently about them. But never mind that, most of the time, they fail by those standards. How about we examine what those standards are worth, assuming they were followed?

Some of us might one day become businessmen, some maybe already are, "capitalists" by the definition that they might own means of production and hold responsibilities over employees and towards clients, creditors, shareholders and associates. They might also be hired labour that manages other people's capital.

As such, we might find that "capitalist ideas" as in "neoliberalism" are starting to seem attractive; a typical case of my morals shifting to one's own circumstances. But, well, those ideas are created from a biased, self-serving POV and may well be used to sugar-coat irresponsible, callous, or exploitative actions. Se I think we'd want to try my hand at questioning and refining them a bit.

Let's start with point one:

Well, what about, say, addictive or harmful drugs? Are we assuming that the "people" here are rational and well-informed? How much of their "want" is their own, and how much do we summon into existence through advertising, marketing, branding, and other mind games?

... I'm finding it hard to see flaws in most of the other points. It does sound rather noble, uplifting, and, well, enterprising. Do you guys feel the same way? Ore there other flaws that you can pick up on?

We can have this conversation, but I'm not likely to participate to any length, as the economics and politics threads consume enough of my OTC attention.

I want to syphon people from there. Splitting the post, as they say!

We don't have an Economy thread, do we?

edited 3rd Apr '15 12:22:02 PM by TheHandle

This one?

To be fair, this thread is not about the realm of economics, but capitalism itself. This has potential, if we're gonna examine the ethos point by point.

I find the way that list seems to worship the concept of "money" to be slightly worrying. I mean, they even use the word "heretic".

But that's the basis of capitalism: money and making money are good things.

Objecting to the conclusion because you reject the basic axiom underlying all the premises never leads to a constructive conversation.

Good thing about capitalism is that human greed is a driving force behind it, while it undermines virtually every other system out there

Pragmatism recommends harnessing natural human tendencies into constructive activity through sublimating mechanisms of incentive and deterrent.

Okay, let me see:

It also ignores that money is power and that too much money concetrated in few hands means they not only have a higher living standard but more political power. That ultimately undermines democracy.

Furthermore there comes a point were to much concentrated wealth is bad for an economy. Five people being able to buy five cheap cars likely generates more jobs than one person buying an expensive car.

If I understand it correctly, than I also have problems with "a just reward for intelligence". Intelligence is not something you can just influence yourself. Getting a reward for something you were born with or was given to you by a privileged upbringing is not worthy of capitalism, it's feudalism.

What? Nearly all economic and political systems are based on greed, or at least self-interest, of one sort or another, even things like Marxism. The primary variable is whose interests are being represented.

edited 3rd Apr '15 6:18:28 PM by Fighteer

Some of that sounds like financial advice. And while that's a useful thing to have it doesn't sound like a good idea to base an ideology on financial device.

And that lats bullet point worries me; At its most neutral money is a tool for operating in the world. You offer some kind of service (such as being a waiter or making chairs) and someone gives you the money, which you use to pay for services other people provide. And while having more of it is generally a good thing for you, I don't think that treating making money in itself should be lionized. Except maybe in the sense that it shows you're a responsible working adult, which isn't the feeling I get from this statement. It's like "this guy made big bucks, therefor he's morally superior." I'm pretty sure that's the sort of thing they thought back in the eighteen hundreds.

Pretty sure the people who think achieving wealth is actually in the minority.

It's also very intentionally vague about the taxation parts. "Tax if you must" well duh the government can't pay for shit if they don't tax anyone. That part just feels mealy mouthed.

edited 3rd Apr '15 8:35:16 PM by AceofSpades

Yep. Just kind of threadhopping, but this is a good point. Attributing wealth to one's moral standing without actual consideration for that person's moral activity is a major problem in many societies, perhaps most so in the United States. We still have a hard time understanding how celebrities and politicians with lots of money can make charitable donations while also advocating horrible ideas like racism and the obstruction of public assistance programs.

edited 3rd Apr '15 9:47:11 PM by Aprilla

Wealth is an imaginary and relative concept, so it can be increased through a trade. For example, a shoe to an amputee is worthless. A peg leg to an able person is worthless. But not the other way around. Thus, if they were to trade, they'd both be richer. Because this fundamental principle works, I'm of the opinion that Capitalism works.

As for addictive drugs, they're not a true example of free trade. An addict, after all, is addicted. By getting someone addicted to drugs, you're using force.

And, to play devil's advocate, there are libertarian groups who won't stop arguing that drugs should be legal. I don't agree with them, but they exist.

As for the "self-serving morals" deal. Everyone makes a system of morality to justify their own existence. It doesn't make one wrong or right by itself. And it isn't like socialists or communists don't try to benefit from their own ethos either.

edited 3rd Apr '15 9:48:57 PM by Protagonist506

Seems like a bunch of things that are kind of true, and a bunch of really bad assumptions.

I kind of like capitalism and I think it's effective at least on a theoretical level. I just think it's really fucked up in its current form in the US. Adam Smith's notions of capitalism have been slowly butchered since he wrote The Wealth of Nations, and he's probably one of the most misinterpreted economists in history.

I'm not going to say that capitalism doesn't work, because it obviously does, but it needs to be heavily regulated to prevent abuse. However idyllically phrased this ethos is, it ignores the fact that if left unchecked many businesses have proven to just run roughshod over the employees.

I'm kind of morbidly curious about the author's stance on union rights, for example.

The author himself grew up in that ideology, but makes a point of stating that he's moved on since then, finding that there might actually be better things to do in life apart from making money. He still routinely freaks out about things like capital gains tax and even dislikes revenue tax, especially progressive; he prefers progressive indirect taxes, and heavy luxury and large property taxes on the rich.

Point is, I wanted to see and understand "Capitalism" from the POV of someone who loved it.

So, the obvious question is, how do you set up a system of incentives and disincentives that would enforce this code. Given how often it's broken, obviously peer pressure is not enough to avoid defaulting to exploitativeness and abuse of power.

You should probably describe an example of an abuse of power that's gone on in the past or is going on today. It's probably not anti-capitalist to want laws regulating what corporations can and can't do. In fact, I've argued before that an area under the complete control of one single monopoly is basically proto-communist (and that a communist state would likewise be a monopoly).

Though I'm not the author, my personal view on unions is that they're just companies which sell labor. My specific ideals would be: 1) People usually have a right to strike or leave their occupation. 2) Nobody should be required to join a union per say. 3) Companies have a right to hire strikebreakers.

@fighteer- I mean that in the sense that communism expect cooperation with the systemfor reasons outside self interest in the "get more stuff" sense, more fear, or personal pressure, or such things. Capitalism makes self interest itself the driving factor behind people complying in the system.

You mean aside from the massive monopolies that built up in the early twentieth century, to the point that we now explicitly have anti-monopoly laws and that we get concerned when companies like Comcast and whatever that other one was want to merge and in effect form a new monopoly? The absolutely shitty way that Wal-Mart and the like basically treat their employees like shit and frequently steal their wages? How businesses push anti-union laws in order to break up their employees ability to negotiate fairer wages and working conditions?

There's like a bajillion examples, dude, of how if capitalism goes unchecked, the people at the top will basically do what they can to maximize their profit and are generally ignorant and uncaring about what happens to those at the bottom. And being otherwise philanthropic doesn't address that issue AT ALL.

Unions are NOT COMPANIES. What they are is worker's organizations that allow employees to pool their resources and leverage their greater numbers to negotiate for fairer pay and safe working conditions. They work to prevent companies from doing things like nixing healthcare, forcing them to work overtime without compensation, famously destroyed the practice of child labor, get worker's comp, make sure you can't get fired just for taking a sick day or something, can't get fired without due cause, and that they can't get drowned out just because their bosses have way more money than themselves. Unions have been incredibly vital to improving conditions in this country, and the fact that big businesses want them gone/stripped of power is not a good thing.

edited 4th Apr '15 12:37:52 PM by AceofSpades

Unions aren't temp work agencies. Although temp work co-ops competing with the likes of Manpower sounds interesting..

"right to work" laws

edited 4th Apr '15 1:26:57 PM by NativeJovian

But should Unions be allowed to create situations like the Three-Day Week or the Winter of Discontent?

The event of the Three Day Week you described was a unique thing.

But what about the other three-day work week, called by Carlos Slim?