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Author Topic: The Free Market ?  (Read 1826 times)

Offline greywolfe

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The Free Market ?
« on: 27/08/2013 18:28:45 »
I don't understand how democracy and the free market works. How can all countries and all businesses all be successful all of the time. All news reports seem to point to this utopia as being an achievable goal but surely if one business wins a contract then their competitors loose. If we simplify the model to an imaginary village containing just ten people each of which has their own product to sell. We have say a butcher, a tailor, a builder, a blacksmith and so on. If the blacksmith's uplift on his product is payed for then the builders costs go up which in turn makes the blacksmiths cost go up thus forcing his products price up to pay for it. This simple model is surely true for a village of ten people or for a world of 10 billion. For people to win in this "game" - there must be loosers. Why do news reels avoid this obvious reality. I would like to hear statistics quantifying how many companies/countries are winning and how many are loosing. These figures would always surely reveal the winners to loosers ratio must remain balanced. Is there a system by which all players can win. Maybe I'm missing the point. A recent example of this was seen in the U.K where a contract for railway carriages was awarded by the U.K government to a German company. There was uproar in the British press at the governments decision to buy abroad but as both Germans & English people are in the European Union - surely we should care about our brothers in Germany with equal concern as we do our fellow countrymen. The financial success stories on this planet are those who have beaten their competitors in the costs verses profits race and then held their margins long enough to stash some cash away. That cash can then be invested in say properties to rent, providing constant income from the loosers who become tenants of these dwellings. What I,m saying is that for the rich to exist there must always be the poor. Can anyone enlighten me to an alternative model please.


 

Offline alancalverd

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Re: The Free Market ?
« Reply #1 on: 27/08/2013 19:03:48 »
Right on, brother wolf.

Some years ago I resigned from an organisation I had founded when it was adopted by a giovernment agency and given the task of improving "regional competitiveness".  With whom I asked, were we competing? And what would happen if we won? Well obviously we East Anglians were supposed to be competing with the West Midlands, Scotland, Southern England, etc., and when we drove them out of business we would have to pay more taxes to rebuild the economies we had just destroyed. The only people who benefit from "competitiveness" are the parasites promoting it. 

Obviously you can't have winners without losers. Unfortunately the alternative is a command economy, which tends to stultify innovation and can lead to major disasters.

I'm interested in the economics of a decreasing population, where resources get cheaper as total demand declines, and "growth" isn't  motivating factor. Added to a fairly free market, this could lead us to a very pleasant, sustainable society with no seriously disadvantaged losers.                               
 

Offline David Cooper

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Re: The Free Market ?
« Reply #2 on: 27/08/2013 19:20:26 »
Not having a free market leads to inefficiencies all over the place (Soviet Union), while trying to depend 100% on the free market leads to major social problems (USA). The answer is to have some kind of socialism (all the big British political parties are socialist to a large extent) using the free market as a tool to drive up efficiency all the time while at the same time providing a safety net for all those who get pushed aside by something more successful. It's a balancing act, and the trick is to watch how other countries are getting on and for the worst ones periodically to switch to copying the best ones so that the world keeps advancing (although you do have to keep an eye on sustainability at the same time, because at the moment we're destroying the life-support systems of the planet and relying on future technological fixes which may not happen).
 

Offline grizelda

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Re: The Free Market ?
« Reply #3 on: 01/09/2013 19:27:18 »
The knee-jerk definition of economic success is growth, so politicians can destroy capitalism and waste the resources on ideological wars but bring in millions of immigrants to bump up economic growth and no one will be the wiser. Probably we need a means test to prove that politicians and voters are willing to commit to economic reality before we allow them to vote or run for office.

Capitalism is a law of nature, if you don't do it someone else will and soon you'll be their slave.
Capitalism depends on growth: If you don't grow you collapse.
This growth must be used to leap-frog over the problems caused by growth, not to build religious or politically correct institutions, else the problems caused by growth will bury you.
You need to compete to cooperate and you need to cooperate to compete, or vice versa, forever.
« Last Edit: 01/09/2013 19:45:22 by grizelda »
 

Offline alancalverd

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Re: The Free Market ?
« Reply #4 on: 12/09/2013 10:22:34 »
Quote
Probably we need a means test to prove that politicians and voters are willing to commit to economic reality before we allow them to vote or run for office.

I would go further than that and require that all politicians must have a significant, declared, active and paid outside occupation  as an employer, employee, or military reservist. Then even if (as now) they didn't represent the interests of their electoral  constituents, they would at least think twice before legislating or going to war. Career politicians are mere parasites, happy to sacrifice the lives and livelihoods of others for electoral advantage.
 

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Re: The Free Market ?
« Reply #4 on: 12/09/2013 10:22:34 »

 

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