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PaperclipPerfector  6mo ago (text post)   21252 thread views

Culture War Roundup for the week of October 9, 2023

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Last week I made an argument on here that while capitalism was excellent at generating wealth, I agreed with @DBR that it was horribly unfair in many ways, and that negative externalities abounded which made the rich less than a shining standard of moral virtue. Unfortunately I felt I wasn't able to give the argument the weight it deserved, and many people made strong points against it. I'd like to quote Brink Lindsey here, who has a more nuanced take on the matter:

Quite simply, there is no set of alternative social arrangements that even remotely rivals the market order’s crowdsourcing approach for generating innovation and mass prosperity. Yes, there are obvious problems with the profit-and-loss system: first, it counts preferences only to the extent that they are backed by dollars, and thus commercial behavior can end up paying excessive attention to the whims of the rich and undercounting what matters for everybody else; second, because of the existence of external costs and benefits, private profit-and-loss calculations can deviate sharply from assessments of overall social welfare, guiding market actors to underproduce goods with large external benefits (e.g., scientific research) and overproduce goods with large external costs (e.g., pollution). These defects are real and important, but governments have been able to compensate for them at least partially through redistribution and regulation. With the growth of the welfare and regulatory state as a complement to the private market order, the larger capitalist system emerged that would carry whole societies to mass affluence.

Essentially I'm arguing against the standard sort of lazy defense of capitalism I see on here. I am not a redistributivist, or a Marxist, but I'm also not a full throated defender of capitalism and markets. I certainly don't buy that without government and regulation, in a sort of anarcho-capitalist state, we would all be better off. Mainly because I don't think we're anywhere near having efficient markets that actually track negative externalities, or have close to perfect information.

It seems clear to me that while Marxism failed as a revolt against Capitalism, there do need to be major changes. However I'm quite unhappy with the proposed systems, as Socialism, the best contender, has quite easily fallen to social virtue signaling as opposed to actual economic change. I briefly flirted with Georgism, but the total disregard for the history of land and people's lives being tied into their property and houses going back generations ultimately turned me off of a land value tax as an optimal way to distribute wealth.

What are some more off the beaten path solutions that have been put forward to the negatives of Capitalism? Ideally we would use markets as a tool within a greater value structure, and keep some things sacred and safely away from money. But in reality, at least in a pluralistic society, that greater value structure seems to be a pipe dream. Capital will find its way into the cracks and mercilessly drive differences in the name of profit.

Does anyone know of inventive, big ideas as to how to plug some of the gaps our rampant focus on wealth has created in our society? To keep the benefits of capitalism while sanding off the rougher edges?

Yes, there are obvious problems with the profit-and-loss system: first, it counts preferences only to the extent that they are backed by dollars

This is a feature, not a bug. This is what money is for. Imagine that we have a semi-capitalist system, where you're paid based on the marginal product of your labor and investments, but everybody's preferences are weighted equally when it comes to production and distribution of goods and services. Under such a system, money would be worth about as much as Reddit karma, and there would be no reason to work.

The weighting of preferences according to how much money you have and are willing to spend is not a drawback of capitalism—it's the main reason capitalism works better than socialism.

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