Comment by canoebuilder | Hacker News Reader

Comment by canoebuilder | Hacker News Reader

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Isn't saying "capital should own things," not so much an ideological perspective but rather just a rephrasing of "things have costs"? Things having costs is a fundamental fact of nature.

There is nothing in the current system that prohibits people performing work from owning the fruits of that work.

How does socialism supersede capitalism's benefit of promoting the transfer of economic value in the form of currency, or capital, from one creative realm to another which has immense creative potential over a less abstracted approach?

Are you saying that socialism basically boils down to prohibition of people owning anything that they did not make with their own hands? And I guess handmade goods can be traded? Do they lose trade potential after they've left the hands of their original creator?

I've generally seen capitalism, not as some sort of cause that emerged from some Magnum Opus and was subsequently cheered on by ideologues in the way of socialism/marxism/communism, but rather as essentially an outgrowth of fundamentally true aspects of nature. Things have costs, energy is cycled and exchanged, etc.

Not to say societies shouldn't have laws and regulations, but when you try to impose laws and regulations that run counter to natural orders and fundamental truths you inevitably run into trouble.

> Isn't saying "capital should own things," not so much an ideological perspective but rather just a rephrasing of "things have costs"? Things having costs is a fundamental fact of nature.

Not at all. In fact, so far not at all I'm actually confused how you think that's true.

Could you elaborate on why you do? It seems important for understanding the rest of your post.

> How does socialism supersede capitalism's benefit of promoting the transfer of economic value in the form of currency, or capital, from one creative realm to another which has immense creative potential over a less abstracted approach?

Socialism is perfectly capable of that process as well -- the difference is who makes the allocation decisions, people who own capital or people who produce things via work. There are arguments for why either side might be better at that task (and in practice, a mix of the two strategies seems to work well).

> Are you saying that socialism basically boils down to prohibition of people owning anything that they did not make with their own hands? And I guess handmade goods can be traded? Do they lose trade potential after they've left the hands of their original creator?

Nope, not even close. Again, to the point I'm confused how you got that impression.

Socialism is just the idea that corporations should be co-ops of their workers rather than property of their shareholders. (Well, okay, there's some fiddly details in particular models, but that's the gist of the difference between capitalism and socialism -- if you structure society around corporations owned by investors or owned by workers.)

> I've generally seen capitalism, not as some sort of cause that emerged from some Magnum Opus

Have you heard of our lord and savior Adam Smith?

The rest of that comment is based on the misunderstanding I pointed out at the top -- all economic theories deal with things like the cost of producing goods and the circulation of goods within the economy. Capitalism is far and away from being "objective" in that regard or the only way to organize activities around that. Capitalism in just as opinionated as Marxism (with just as outspoken of supporters, if not more so), it simply has different opinions.

> when you try to impose laws and regulations that run counter to natural orders and fundamental truths you inevitably run into trouble

Capitalism is none of those things, thankfully.

In many places, you seem to conflate "capitalism" with the notion of economics in general.

If we understand "cost"/"exchange" as transfer of energy from one component of a system to another anytime a "thing" occurs, the results of this thing occurring are what is now owned by the entities party to the exchange.

A hypothetical object in motion under no external forces will remain in motion until a force acts on it, upon this acting, energy will be transferred, thus a cost.

In our more familiar world, a ball rolling down a trail will continue rolling until the friction of the dirt provides sufficient cost/exchange of energy, or the ball encounters a change in grade on the trail such that a gravitational force extracts enough of a cost on the kinetic energy of the system to cause it to stop. For the ball to regain motion some other force must be applied to the ball at an energetic cost to the entity exerting the force.

We can see these costs/exchanges and any change of state in a system as equivalent because the total energy in the system remains the same. Anytime there is a change, there is a cost.

A "thing" is something that is identifiably different from other things. What causes differences to arise is fluctuation of energy in the system. A thing is a fluctuation, a fluctuation is an exchange, and exchange is a cost, things have/are costs.

At a less cerebral level, anytime you do a "thing" it comes at the cost of other "things" you could do. So whatever thing you're doing has this opportunity cost.

We've mapped the abstraction of money onto many types of costs, but costs can be at a level other than monetary.

"Capital should own things" because capital is the name we've given to the unit of energy in economic systems, and as we've seen above "things have costs," all things have costs. And as we've also seen above, "ownership" is the name given to the new state assumed following an exchange. The ball owns "at rest" after the exchange with the dirt.

It's not really "capital" that owns things, but the spenders/deployers of capital[0]. Just like it's not friction that owns the at rest state, friction was just a name for energy exchanged. The ball and the dirt conducted a transaction in friction, the ball got "at rest" and the dirt got "increased heat."

[0]So I guess at this point you'd say, in Socialism we'd prescribe that you can't spend money on things that confer ownership of future exchanges for money, or things that increase in value. But here is where the nature of reality is critically important, the universe is not perfectly flat, there are always going to be peaks and troughs in the distribution of energy so long as the universe is the one we recognize today. Not every cost will dissipate in it's returns because the total amount of energy in system is conserved. So if there are some costs that are net losses some must be net gains. And there must be variation in results of exchanges because otherwise we wouldn't see anything around us, we see things around us because of fluctuations in energy.

While Piketty's equation might need to be addressed, not understanding the reality from which it arises doesn't help in addressing it.

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II

You may have a broader understanding of this than me, but isn't "capitalism" simply the name we've given to the dominant economic system we've found that came to be through emergent processes of human social interaction stretching back thousands of years? Nobody ever said I'm going to start Capitalism!

Yes, there were some abstraction layers added on with the development of capital/share markets and limited liability corporations around 1400-1500AD, but it seems to me what we call capitalism is simply the name given to the economic system we've deduced to be present wherever we find things like coinage and contracts/exchange agreements in history. Were the ancient Greeks "capitalists"?

Adam Smith was for the most part describing what he saw around him and what already existed, was he not? I don't believe he was prescribing whole new systems of being.

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III

So you're saying Socialism is simply a restricted form of Capitalism?

Because the characteristics you give for Socialism, workers owning what they produce and co-ops, are not only possible in our capitalist system, but they are present in significant number.

In fact, in capitalism everyone owns the fruits of their labor. Were that not true, it would be more appropriately called slavery.

A computer programmer may or may not take home his code at the end of the day, depending on if he is employed by someone else and the agreements made between him and whoever may employ him, but he still owns what he has created even if he doesn't take the bytes home. He has just agreed to exchange it for something else upon creating it, most likely capital/currency.

So you're saying things would be better if such agreements were restricted by law?

That's actually just propaganda phrasing without deep insight, laying claim to a shared heritage as a claim to legitimacy while pretending that your mere opinions are theorems derived from facts.

It's no more insightful than Christians and Muslims debating if Moses was a Christian or a Muslim, because clearly all historic leaders were members of the one true faith.

> Yes, there were some abstraction layers added on with the development of capital/share markets and limited liability corporations around 1400-1500AD, but it seems to me what we call capitalism is simply the name given to the economic system we've deduced to be present wherever we find things like coinage and contracts/exchange agreements in history. Were the ancient Greeks "capitalists"?

This is a perfect example, because it's not true. The features of a modern system (of which capitalism is one) are very much a modern invention, precisely because they require that modern notion of social structure/corporate ownership.

Those "arbitrary layers" are what defines capitalism as a thing distinct from socialism or mere economics. Conflating capitalism with the "physics" and not the arbitrary layers is precisely the conflation between capitalism and economics I was calling out earlier, and seems to be rooted in capitalism having been the dominant economic model of your society -- you seem to have a hard time delineating and separating that choice from the nature of economics vis-a-vis physical constraints and their impact on all viable models.

> Because the characteristics you give for Socialism, workers owning what they produce and co-ops, are not only possible in our capitalist system, but they are present in significant number.

Our system isn't strictly capitalist.

You can look at, eg taxes to fund social projects as an example of that. The public is the ultimate owner of the nation, and retains a portion of any value created by investments of capital there, which is then used to benefit the public. That this distribution of wealth to the public instead of capitalists tends to create several dollars more wealth from the induced spending is actually a socialist benefit, not a capitalist one.

But also, you're correct that our legal system doesn't mandate capitalist economics for corporations. It's just the dominant model.

> In fact, in capitalism everyone owns the fruits of their labor.

Only the immediate fruits of their labor, that is, what they can charge for that piece of labor.

That's not what we're concerned with here. We're talking about the method by which we allocate the generated value when you scale up via corporations (or other mechanisms). That is, how we handle collective allocation and management.

Socialism is an attempt to allocate those benefits more evenly between capital and labor (or in the more radical cases, entirely to labor) in an effort to combat the social harm from "cogification" of labor, in which a corporation has many laborers perform a basic, easily replaceable task so that most of the value added by the collective labor can be extracted by capital.

> So you're saying things would be better if such agreements were restricted by law?

Such agreements are restricted by law, eg you can't select your programmer based on if they're male or female and you must pay them at least somewhat over $7/hr it takes them to create it, etc.

However, the ultimate argument between the two is this: is it better to aggregate wealth around points so that it can be coherently deployed even if these economic eddies decrease overall economic volume?

In practice, "top-down" control is a failure and capitalism in terms of efficiency of dollar to dollar spending can't compete with market-based socialism, and so (because of the physical demand for efficiency!) we see practically every major economy in the world (including the US) function as a mix of socialism and capitalism.

We would be better off if we stopped listening to greedy people and nudged it more socialist.

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