Is profit different from unfair tax?

[Kidicious]

Originally posted by Velociryx
We're equal now...me too. I walked away from my job on my 35th birthday, knowing that the job market sucks. So now we're alllll nice and equal.

Oh, we are the same age too.

Originally posted by Velociryx
This will make a good experiment, I think.

You keep applying the principles YOU cling to, and I'll apply mine. We'll compare notes in the weeks ahead and see how we both fare. Since we're starting off on an equal footing (both unemployed) that's about as "fair" as it gets, yes?

-=Vel=-

I only apply the principles of hard work and sticky to it ness.

[Ramo]

Kid does have a point. If you assume that the state has moral rights to the property in the world, it has the moral right to tax all it wants. Similarly, if you assume that capitalists have moral rights to the means of production, they have moral rights to deny the workers all the profit made from their labor. I don't see why one assumption is any better than the other.

[Kidicious]

Cool sigs Ramo :b

[Berzerker]

It's not about how one state has done compared to another.

By definition there can be no communist govt while the capitalists control the world.

Capitalists have never controlled the world, just parts of it like the communists controlled part of it. So it IS about comparing states and their economic systems with each other. The communists lost. But with communism, according to your logic, capitalism cannot be allowed to co-exist (because it is superior). Is that true for capitalism? Nope. If a group of people, or even a state, want to have a communist system and don't threaten to impose that system on others, capitalism will allow it to exist. That speaks volumes about the morality of the two systems. Communism = convert or die. Capitalism = live and let live... Isn't it a little ironic that communism resembels the Inquisition?

[Ramo]

Thanks Kid.

[Kidicious]

Originally posted by Berzerker
Capitalists have never controlled the world, just parts of it like the communists controlled part of it. So it IS about comparing states and their economic systems with each other. The communists lost. But with communism, according to your logic, capitalism cannot be allowed to co-exist (because it is superior). Is that true for capitalism? Nope. If a group of people, or even a state, want to have a communist system and don't threaten to impose that system on others, capitalism will allow it to exist. That speaks volumes about the morality of the two systems. Communism = convert or die. Capitalism = live and let live... Isn't it a little ironic that communism resembels the Inquisition?

In your opinion the capitalists allowed the communist states to exist? Silly

Gotta go to class. I'll catch up tomorrow.

[Flubber]

Vel


KId-- I should go back and pick out some of your " best " quotes since to me , you sound so patently absurd, but you are essentially spouting the same thing over and over-- In rebuttal I'll say this slow

YOUR SYSTEM DOES NOT WORK.


AS soon as you start paying people the same regardless of performance, performance suffers. . .. THis is a common phenomenon -- people can be performing at rate x for 10 years . . you offer a performance bonus and sufddenly they all increase production.

As soon as you tell the best and brightest that their effort or intelligence will not be compensated , they leave. As soon as you start compensating the same for all sorts of jobs, certain jobs get more popular since some jobs are less desirable than others. If I was paid the same , I probably would rather mow lawns than work an office job ( exercise and fresh air would be nice) although I think I would most like to be a security guard since I love to read. Oh oh and I'd want the day shift and don't dare offer a shift differential for those that work mights or weekends

You will probably reject my arguments since I MUST be part of the oppressive elite. Lets see, my grandfathers were labourers, my parents were a school teacher and a nurse and I have held a job continuously since I graduated high school ( and often two or three at a time) and always worked while attending college. I was handed nothing so you can stick any mention of the elite where the sun don't shine. Its because I come from modest roots that I don't buy the argument that the people that have less " have no choice"

Jobs I have held:

Labourer (ditch-digger - literally)
Dishwasher
Bartender
Fish plant worker
Fish plant supervisor
Pizza Cook
Computer Lab attendent
Store Clerk
Tax Assessor
Lawyer

Despite all the jokes about the profession, my job as a lawyer is the hardest of them all. There is almost constant stress, long hours and personal responsibility and accountability for my work. While I have doubts about my value to society LOL, I make no apologies if someone wants to pay me well to apply my trained brain to their problems.
You might say that a diswasher is responsible etc but its not true to the same extent . .. As a dishwasher I left precisely when my shift ended and EVERY dish there became someone else's responsibility. I think that is true of many higher paid jobs in that the person is not interchangeable .. . no other individual picks up the workload at the end of some arbitrary shift change.

If I could make a similar income, I probably would have never stopped being a bartender. I enjoyed seeing all the people and listening to the music--

In your perfect system Kid, if you could design it, how would you entice people into the harder jobs?? err ummm perhaps pay them more

[Velociryx]

What I'm genuinely curious to know is this:

Rather than b*tch and moan about not owning the means of production, why not go out and acquire them?

The means to do so are certainly there...what do you want to do? I can give you a step-by-step outline to acquire the means of production to do whatever it is you want to do.

But....that would involve WORK (or would it? You don't seem to believe that acquiring and organizing the means of production is "work" per se, so if not work, then what term shall we use for that?) And your plan is MUCH easier, because it does not involve work....it merely involves taking the means of production by force, and that's a lot less hassle than actually working for it, so you prolly woulnd't be particularly interested in my step-by-step plan, but assuming you were, once you have acquired these means of production, I suppose you'll just let your employees use your equipment free of charge, paying them the full value of whatever they produce using the machine you paid for, because to do any less would be a violation of your principles, true?

It'll be an interesting company you run!

-=Vel=-

[Velociryx]

And thank ya, Flubber!

-=Vel=-

[Berzerker]

Ramo -

Kid does have a point. If you assume that the state has moral rights to the property in the world, it has the moral right to tax all it wants. Similarly, if you assume that capitalists have moral rights to the means of production, they have moral rights to deny the workers all the profit made from their labor. I don't see why one assumption is any better than the other.

When you say "capitalists have a moral right to the means of production" you are saying they have the moral right to their own labor and property. When you say the state has the moral right to all the property, you're saying one group of people have the moral right to forcibly seize the property and labor of others. The two are not analogous...

If I'm a capitalist, just how do I deny my employees the profit from their labor and stay in business? Unlike communism, if I don't cut my workforce in on the profit, they will seek employment with a capitalist who will. And the reality is that the worker "profits" off the labor of the employer too... If I own a business and I buy machinery, the worker I hire to run the machinery profits from my investment. His labor and skills are worth less without my machinery, so his increased productivity due to my labor results in "profit" for both him and me. I profit from his labor combined with my labor and he profits from his labor combined with my labor. We both profit off each other...

[Flubber]

Whats funny about the whole " ownership of the means of production" argument is that while most large corporations have many wealthy stockholders, a large proportion of the stocks are owned by average workers through their RRSPs, or pension funds, college funds for children etc. So a large chunk of the profit that is exploited by the " capitalists" is appropriated for the benefit of the workers.

[Ramo]

When you say "capitalists have a moral right to the means of production" you are saying they have the moral right to their own labor and property.

Their own property? What does that mean exactly? Argument by definition ain't gonna work.

When you say the state has the moral right to all the property, you're saying one group of people have the moral right to forcibly seize the property and labor of others. The two are not analogous...

What if it's the state's "own" property and we're all just squatters?

If I'm a capitalist, just how do I deny my employees the profit from their labor and stay in business?

It's pretty easy. Just look at the biotech industry.

Unlike communism, if I don't cut my workforce in on the profit, they will seek employment with a capitalist who will.

Bringing up some sort of strawman Stalinism? I'm not an authoritarian.

And the reality is that the worker "profits" off the labor of the employer too... If I own a business and I buy machinery, the worker I hire to run the machinery profits from my investment. His labor and skills are worth less without my machinery, so his increased productivity due to my labor results in "profit" for both him and me. I profit from his labor combined with my labor and he profits from his labor combined with my labor. We both profit off each other...

Well, of course the worker gains more from the existence of the means of production than without (under most circumstances), but he'd be in a better position if he owned it along with the rest of the workers.

Rather than b*tch and moan about not owning the means of production, why not go out and acquire them?

It takes a little more than just a little bit of initiative for a Bengali farm worker to take over his land without force. Only in situations where taking over the means of production peacefully is not a legitimate possibility do I advocate force. I'm a syndicalist for a reason.

[Berzerker]

Kid -

In your opinion the capitalists allowed the communist states to exist? Silly

Gotta go to class. I'll catch up tomorrow.

You didn't read my post close enough, I said:

If a group of people, or even a state, want to have a communist system and don't threaten to impose that system on others, capitalism will allow it to exist.

You forgot that part...

You've already admitted communism must be imposed globally so it is not the intention of the communist to allow capitalism to co-exist. Therefore, capitalists are put in the position of convert or die... They seek a third option, self-defense... There is nothing inherent to the capitalist system that requires the absence of communism everywhere, but as you've acknowledged, there is something inherent to communism requiring the absence of capitalism everywhere... And one reason communism has failed is because the communists could not rid the world of capitalism. Why does that matter? Because this inherency in communism requiring the absence of capitalism is communism' inability to compete...

It's no coincidence communists build walls to prevent escape to capitalism.

[Ramo]

Whats funny about the whole " ownership of the means of production" argument is that while most large corporations have many wealthy stockholders, a large proportion of the stocks are owned by average workers through their RRSPs, or pension funds, college funds for children etc. So a large chunk of the profit that is exploited by the " capitalists" is appropriated for the benefit of the workers.

Yep, and I'd like to see that proportion 100% instead of the much, much smaller number it typically is, and just as importantly, I'd like to see the workers with some genuine control over how the business operates. Corporations are typically extremely authoritarian, hierarchial institutions. Democracy in the economy and all that shtick...

[Berzerker]

Ramo -

Their own property? What does that mean exactly? Argument by definition ain't gonna work.

You know what it means, and we aren't going to get into another "the land was stolen" debate. We've gone through that one before and you know my position.

What if it's the state's "own" property and we're all just squatters?

Isn't that what communism comes down to (in theory, not in practice)? How can we all be squatters when the state is run by people? Doesn't that mean one group of people own the land and another "squats"?

It's pretty easy. Just look at the biotech industry.

Provide a specific because it's not only not easy, it's non-existent.

Bringing up some sort of strawman Stalinism? I'm not an authoritarian.

Huh? Introducing a strawman in response to a strawman I didn't bring up? We're debating communism in this thread, not anarchism. But would you really allow capitalists to co-exist with anarchism? Or would you find a reason to accuse the capitalist who doesn't want to sell out to the workers of stealing property and then just seize their assets?

Well, of course the worker gains more from the existence of the means of production than without (under most circumstances), but he'd be in a better position if he owned it along with the rest of the workers.

Then tell Kid because he refuses to understand that both parties "profit". Now, does capitalism prohibit a group of workers from buying out the investments of the owner and owning their own business? Nope... That too is capitalism...

[Berzerker]

Yep, and I'd like to see that proportion 100%

How will a business expand if all the profit goes back to stockholders?

[Jules]

Originally posted by Berzerker


How will a business expand if all the profit goes back to stockholders?

Loans, issue new stock or bonds

[MichaeltheGreat]

Originally posted by Kidicious

Production is the same. I didn't say anything about less total compensation so you figure it out.

If you divide up the same task over a larger number of workers, with more shifts due to shorter work weeks, you have a loss of production. Most jobs involve some non-productive individual transition time at beginning and end of shift - say coal miners who clock in at the mine head, then ride down the elevators and walk out to the current production areas. Or machinery operators who have to shut down at end of shift, secure the whatever it is so it doesn't fall on the next guy, then secure their safety gear before they clock out. Meanwhile, the next guy clocks in, puts on his safety gear, goes over some paperwork, does a safety inspection on his machine (left by the last guy some time before), and then starts being productive. Most construction jobs are the same, if you're not digging a ditch with a shovel - plumbing, piping, electrical, concrete work - there's a beginning of shift and end of shift transition.

Intellectual work such as engineering, software design, etc. not only has those issues, but additional time needed for communication, division of assignments, dealing with all the workers involved in a particular subset of your project - those things all go up in proportion to the number of people involved, so there is in fact a decline in productivity.

There are some exceptions, of course, but not the majority of jobs, and almost no jobs involving highly specialized skills.

The less total compensation comes from two things - one you said, and one interjected by brutal economic reality. You've said that communism only works globally, so if you're going to do that, you have to put my wages on a relatively similar scale as the Burkina Fasoan goatherd. You can drop mine, or raise his, but with more "wages" chasing an initially similar level of goods, you induce either inflation or create a huge demand for black market items if you alternatively freeze prices but don't have enough products to supply demands.

The other side, if you drop the absurdity of equalizing global wages (oh you counterrevolutionary bourgeoise exploiter you) is that you can either cut wages for the existing bodies in proportion to their reduced workweeks, or you can give them the same pay for less work, and either pass on the higher costs (which defeats the whole purpose, because now you price items up while keeping wages the same and now everyone is in a hole), or you subsidize your labor cost increases and charge a distorted price for your produced item. And that subsidy has to come from somewhere. After you run out of bourgeoise pigs to line up against the wall and steal their property as part of your revolutionary justice, you're left with no other source to subsidize your distorted prices. And guess what happens then?

The fact that capitalism doesn't provide jobs for everyone is erosive to living standards, but you don't see that.

No economic/philosophic system "provides jobs." Communism sure doesn't. You still have some form of business enterprises which produce things, and the only difference is how owners and managers are associated with those enterprises, and the motivations of the owners and managers.

Well we aren't talking about individuals individually. We are talking about them as a group. We are talking about a system. Yes! capitalism is an economic system, like it or not.

I'm talking about individuals individually, because that is ultimately what a market is.

Convenient for you to let the govt off the hook like that, but it's not going to cut it.

It's not letting the government "off the hook." You're assuming government has this all-intrusive role of running people's lives and determining what constitute their well-being. I'm assuming that government governs best which stays out of range.

I only have control over myself and the decisions that I make. I have no control over others and no knowledge of the decisions that they will make. I only know that most of them will make bad decisions because they don't know anymore than I do. That's chaos. There is no order. If I have plenty of resources it doesn't really matter, but if I'm poor and I make a bad decision I'm screwed.

Ja, order ist gut.

Your argument is specious - you don't need instant or complete knowledge of others' decisions because those decisions don't result in instantaneous effects in the market. I can go look up data on wages for different types of IT professionals in different areas of the country, and know that that data is not going to sharply change next week or next month. And I can pay attention to industry articles and publication, particularly on the end user side, and get a fair idea of whether a particular new and shiny technology seems to be sticking in the marketplace. You can make intelligent judgments. And most "bad decisions" are recoverable unless you decide to knock off a liquor store and a cop pulls in 30 seconds behind you.

[MichaeltheGreat]

Originally posted by Jules

Loans, issue new stock or bonds

Which is stupid, because all of those dilute the short term profits of the stockholders, while saddling the business with additional debt, or continuously devaluing stock - neither of which is in the long term interests of any party.

[MichaeltheGreat]

Originally posted by Ramo
Yep, and I'd like to see that proportion 100% instead of the much, much smaller number it typically is, and just as importantly, I'd like to see the workers with some genuine control over how the business operates.

Most workers are self-absorbed morons with little or no concept of the overall business picture, and most really don't give a **** to know, as long as they get paid and you go through the motions of treating them decently.
That's why most "employee owned" companies hire real management to run things.

Corporations are typically extremely authoritarian, hierarchial institutions. Democracy in the economy and all that shtick...

Some of us know how to run things. And democracy becomes a combination of circle-jerk and bureaucratic paralysis.

[Berzerker]

Loans, issue new stock or bonds

MtG answered that one better than I could have (that's why he's great and I'm merely ).

But if you issue a new stock, wouldn't that be considered profit and sent right back to the other holders? It should since it seems issuing stock is like printing more money, it results in inflation thereby devaluing existing stock. Maybe I'm wrong on that... As for loans, so instead of using profits to expand, a business should go into debt? Maybe Ramo didn't really mean 100% of the profit should go to the workers but that some of the profit would be used for expansion...

[Jules]

For some reason I was under the impression that very little investment is actually financed through retained earnings. I'm trying to find a statistic on that somewhere.

[Skanky Burns]

Originally posted by Berzerker
Maybe Ramo didn't really mean 100% of the profit should go to the workers but that some of the profit would be used for expansion...

I think he meant employee ownership of the company would be 100%.

[Velociryx]

So then...if the owners, who own 100% of the company, agree to NOT take all the profits out and use it to finance expansion (say, use a portion of retained earnings as collateral for a loan), that would be.....

-=Vel=-

[Dauphin]

Originally posted by Jules
For some reason I was under the impression that very little investment is actually financed through retained earnings. I'm trying to find a statistic on that somewhere.

It isn't usually, simply because debt is cheaper to service than equity. Provided you're not in financial distress debt is often preferable.

[Dauphin]

Originally posted by Berzerker
But if you issue a new stock, wouldn't that be considered profit and sent right back to the other holders?

If you issue stock you match a new asset with a new liability. Nothing touches the P&L as far as accounting is directly concerned.

It should since it seems issuing stock is like printing more money, it results in inflation thereby devaluing existing stock. Maybe I'm wrong on that...

If a company issues new stock it is usually because it is set to take on new and large projects that will bring in profits. Shareholders or potential investors will thus value company shares more highly and the price per share will go up.

Failing that if the shares are issue at worth, dollar for dollar, there is no inflation. Say a $100 dollar net asset company with 100 issued shares sold 100 more shares at $1 each. Rather than having 1 share representing 1% of a $100 dollar company the new shareholders would have .5% of a $200 company. Both ways their net worth is steady, just their voting rights have declined. Normally net worth will actually increase for the reason stated in the above paragraph.

[Jules]

Here's why I've always thought that. From looking at national income tables produced by the BEA. For example, here's corporate profits from 2002. Notice that undistributed profits make up only a small fraction of after-tax profits.

[Dauphin]

You need to (at least) compare that figure to the amount of new net debt taken out, not the overall profits. It tells you little about the debt-equity ratio otherwise.

[JohnT]

As a dishwasher I left precisely when my shift ended and EVERY dish there became someone else's responsibility. I think that is true of many higher paid jobs in that the person is not interchangeable .. . no other individual picks up the workload at the end of some arbitrary shift change.

Precisely. As President of two companies, I can tell you that I don't leave the job just because I leave the office... I'm always working, thinking about the job. Once you get to a certain level of authority, it isn't something you can just turn off when your "shift" is over.

[JohnT]

Edited out as 'twas nothing but a rehash of the above 5 posts.