Practical test of democratic Socialism

Gary L

Could a small group of individuals test socialist philosophy by joining together financially?
Let’s say for instance if they formed a business and pooled all their income into it.

Now the sole responsibility of the business is to provide for their basic needs, meaning a good standard of living. With the rest of the money they provide the next desired luxury or invest in say a newsagents. Now the newsagents is being owned and operated by this democratic council. The shop won’t have a blind ambition of profit maximization. The business will be run according to what is best for the community (business). The profit from the shop is taken into the communal fund and the benefit is spread among all.
The business may invest in new members.

Say they set up housing, essential services, food, and every luxury afforded to them and offer it to someone in exchange for their pooling their income into the community fund. They could offer this to the employees of the newsagents.

In theory, they could offer this to everyone as long as a job existed that could cover their basic living expenses. Expansion of the community could be done in phases with continual reinvestment of the joint fund in new factors of production which would perpetually increase the wealth of the society. At this point the group would be operating as a large investment co-operative in its interactions with the external capitalist system.

Internally it will function as a democratic socialist community. In this community, the workforce will receive the full value of their labour. Wealth won’t slowly shift away from the working class towards a much smaller group of owners. This increase in a normal person’s affluence would be huge. The money would be more than enough to perpetually increase the size of the community, as any job in a capitalist system creates more wealth than the value of the workers wages.

The organization could be run just like government, the only difference being that the government controls all the factors of production within the community. This would be an extension of democracy. To avoid bureaucracy, the government obviously would delegate responsibility for each area down along through its workforce. Businesses would be run by their workers. As the community develops the ability to satisfy many of the 'wants' as well as 'needs' of its populous, Money would be redistributed back individually but equally. It wouldn't be possible for individuals to use this money to make more money, only to accumulate personal goods.

This is of course a loss of a 'freedom' but in reality would it be so bad relatively speaking? All your basic needs guaranteed to be covered, much better public services and the financial ability to buy at least as much luxury goods than you do now. The top richest people in our current system would slowly lose their excess but would hardly starve. They'd enjoy at a minimum the same standard of living as everyone else.

Back to the original principle of investment as opposed to increased luxury. Eventually everyone who wants to be in is in, and everyone is on a very good standard of living. At this point all the excess wealth of society can be devoted to;

· Increasing technology based production and eliminating human labour.
(This couldn't happen in a capitalist system because without paid workers the system doesn't function.)

· Investing as much as is needed in renewable energy.

· Funding education, research and the arts

Essentially the wealth of society would be used to continually better society, based on a democratic decision making process. It would be nice if it worked. Would it?

Regarding the loss of innovation, competition would still exist on luxury goods and let it not be said that a profit motive is needed for scientific research.

Regarding the loss of motivation, Jobs would still be allocated on a merit basis and the natural desire for status would lead people to strive for promotion and to enter professional fields. Also a goal of government would be to reduce the need for labour as much as possible, focusing instead as much as possible on education and research.

I've never heard a proper argument as to why democratic socialism wouldn't work. Anyone agree that this is something we should strive for?

Mahatma coat

two questions
Who Defines a Luxury good?

why do all these schemes seem to involve the Automation of most production processes? surely that goes against the first part of your post

me_right_one

Excellent post. Yes, that would work perfectly, it would be ideal. In an ideal situation, I dont see how anyone would lose freedom or motivation though. What you have described is basically how large scale farms work, Ireland is full of those.

This has been tried and tested throughout history. The fatal weakness it has is that when someone decides to have it all their own way, there is no real mechanism to stop them. (In a democracy in the true capitalist sense of the word, you can always vote out the troublemaker). They have too much control. THEN you could have loss of motivation / feelings of rebeliousness among those UNDER the corrupt manager. Just take communist russia for example. Stalin basically ruined the dream for all socialists. But he tested communism to its limit, and at least he exposed the weak areas. china learned from him. They are successful communists. So far at least.

Joycey

China is a state-capitalist state, not communist, socialist, or anything resembling it. Democratic accountability to a much greater extent than exists in any current Western capitalist state is necessary for true socialism. It prevents authoritarianism from emerging.

If democratic decision making is employed at all levels of society, then no problem with "corrupt managers", like Stalin comes into play.

I think the co-operative in England was set up as something along these lines, not sure about that though. There are other businesses who are given to the workers as a loan in places like Argentina and Venezuela which operate successfully under this kind of format, not sure how much they ever expand though.

Soldie

How do you suppose the business will grow if the income is spread amongst all employees evenly? You said that a surplus could be used to expand, but this is inconsistent with your suggestion that everyone should be remunerated to the full value of their labour, and I assume that you're talking about the Marxian definition of value.

Suppose the business was a hospital -- will the person cleaning the toilets be making the same money as the brain surgeon?

Gary L

If the surplus goes to the benefit of the whole and is fully democratically employed rather than going to private owners then the individual still benefits fully from his production.

Whats so bad about a toilet cleaner making the same as a brain surgeon? Would you prefer to be the toilet cleaner if that was the case?The world could barrel along just peachy without the profit motive.

Besides in a socialist society there wouldn't actually be wages everything would be free.you might say that people would go crazy taking more than they need but why would you bother? What are you going to do sell the stuff? It would be utopia man think about it. Do you think capitalism is better than Socialism? Thats the bottom line.

Victor

Gary L wrote: »

Besides in a socialist society there wouldn't actually be wages everything would be free.

Property is theft, but also, free is theft.

We everyone would love for everyone to be provided for, in accordance with their needs, some people aren't willing or capable to manage their own needs and desires. Hence if everything was free, some people would insist that they get a Rolls Royce so they can drive to the shops, lights would be left on all night and capital and other resources would be wasted and destroyed wantonly.

At they same time, pure capitalism / freebooter libertarianism doesn't appeal to many, so striking a balance somewhere in the middle, is in my opinion best and indeed, most people agree.

Gary L

Victor wrote: »

If everything was free, some people would insist that they get a Rolls Royce so they can drive to the shops, lights would be left on all night and capital and other resources would be wasted and destroyed wantonly.

I'm not putting forward a complete institutional framework here. If social problems emerged we still have law, we can deal with our problems democratically. Capitalism is a terrible way to run the world . But more importantly what your saying is crazy why would capital and other resources be destroyed wantonly?

silverharp

Gary L wrote: »

But more importantly what your saying is crazy why would capital and other resources be destroyed wantonly?

If you look at communist Russia , tempature control in aprtments was opening your windows even in the height of winter. A perfectly rational decision when everything is "free"

Soldie

Gary L wrote: »

If the surplus goes to the benefit of the whole and is fully democratically employed rather than going to private owners then the individual still benefits fully from his production.

What surplus? Everyone is being remunerated to the full value of their labour, and everything is free. There is no surplus.

Whats so bad about a toilet cleaner making the same as a brain surgeon? Would you prefer to be the toilet cleaner if that was the case?The world could barrel along just peachy without the profit motive.

Few people will bother spending ten years in medical school specialising in neurosurgery when they could finish school at fifteen and make the same wage as anyone else.

Besides in a socialist society there wouldn't actually be wages everything would be free.you might say that people would go crazy taking more than they need but why would you bother?

Does this mean I can go into my local supermarket and load up the trolley with the most expensive foods and just leave without paying? Who is ultimately going to pay for all of it?

It would be utopia man think about it. Do you think capitalism is better than Socialism? Thats the bottom line.

Yes, I think capitalism is infinitely better than socialism because it works.

Iwasfrozen

Soldie wrote: »

What surplus? Everyone is being remunerated to the full value of their labour, and everything is free. There is no surplus.

In a capitalist society the worker never gets the full value of his work because the surplus (i.e the retail value of the item - the amount the worker is paid = the surplus.) is taken by the workers manager and moved around the market.

Soldie wrote:

Few people will bother spending ten years in medical school specialising in neurosurgery when they could finish school at fifteen and make the same wage as anyone else.

There are motivations to work hard other then money, the Doctor may spend those 10 years in medical school because he wants to save peoples lives or he feels he wants to work to the benefit of his community. You may call me naive but imo, saying the only motivation for Doctors is financial is very naive.

Soldie wrote:

Does this mean I can go into my local supermarket and load up the trolley with the most expensive foods and just leave without paying? Who is ultimately going to pay for all of it?

You are indirectly paying for it, remember you don't get wages.

Soldie wrote:

Yes, I think capitalism is infinitely better than socialism because it works.

How can you say that when Socialism has never even been tried ?

bonkey

Iwasfrozen wrote: »

IYou may call me naive but imo, saying the only motivation for Doctors is financial is very naive.

Surely what is relevant is whether or not finncial remuneration is ever a motivation for any job.

For me, one of the biggest problems with a practical test of democratic socialism, as proposed, is that it requires "buy in" from people who would otherwise be better off. While such altruistic individuals can almost-certainly be found, what happens when the test becomes generational? When we move to the children of such people, what then? If they do not have the same altruism, then sooner-or-later, the society faces stresses from those who didn't choose this society, and who would be better off elsewhere.

Similarly, its possible (although unlikely, I would guess) to create such a society where every participant is honest...where they all want to play according to the tules, rather than try and game the system one way or another. Again, move generationally, or even just across some years, and you will have people who figure that they can have a better level of satisfaction by contributing less but still receiving their "fair" share.

It is the stresses that are generated as the population (or conditions in general) deviate from the ideal that really test the sytem.

If someone were to create an ideal-case test society for capitalism, it would also offer the possibility to work as wonderfully as any other utopian ideal. Introduce the same stresses, though, and the cracks start to appear.

Soldie

Iwasfrozen wrote: »

In a capitalist society the worker never gets the full value of his work because the surplus (i.e the retail value of the item - the amount the worker is paid = the surplus.) is taken by the workers manager and moved around the market.

I'm aware of the Marxian concept of "surplus value"; which is nonsense, by the way. Nevertheless, this thread is about socialism and that is the point I was addressing. The original poster contradicted himself by saying that everyone would be remunerated to the full value of their labour, while the surplus is used to expand; there can be no surplus in such a situation.

There are motivations to work hard other then money, the Doctor may spend those 10 years in medical school because he wants to save peoples lives or he feels he wants to work to the benefit of his community. You may call me naive but imo, saying the only motivation for Doctors is financial is very naive.

I didn't say that it's the "only motivation", but one can't deny that profit drives innovation and efficiency. Consider a shop-owner who expands his shop in order to increase profits, and in doing so benefits the local community by making a larger number of goods available to them. A rival shop-owner may sell goods for a lower price in an attempt to increase his market share and, again, benefit the local community by driving prices down. Under a socialist system there is no incentive to innovate or to increase efficiency, as history has shown us.

You are indirectly paying for it, remember you don't get wages.

So after a hard weeks's graft chopping down trees I can just head into town on my weekend off and help myself to "free" everything? Mansions, ferraris, truffles, champage -- you name it, it's all free!

How can you say that when Socialism has never even been tried ?

This is completely incorrect, but let's ignore that. Socialism doesn't even work in theory because it is built on a foundation of economic fallacies.

Joycey

Soldie wrote: »

I'm aware of the Marxian concept of "surplus value"; which is nonsense, by the way.

The bit that you quoted there seems absolutely coherent to me. Could you explain what you feel is nonsensical about it?

Isnt the definition of profit essentially the same as what we are here more accurately calling surplus?
Profit = income for the profitting individual - expenditure that their endeavor required, where one element of this expenditure is the remuneration for the (other) humans who created the goods which created the income. No?

Nevertheless, this thread is about socialism and that is the point I was addressing.

I think youl find that since Marx was writing you wont find anyone who claims to be a socialist without either adopting or heavily engaging with Marx's views, so it almost seems a truism to say a discussion of socialism will involve Marxist ideas.

The original poster contradicted himself by saying that everyone would be remunerated to the full value of their labour, while the surplus is used to expand; there can be no surplus in such a situation.

This bit I agree with. However I would hazard a guess of a way out of the problem along the lines of stepping outside the conception of remuneration as being in the form of a wage, and rather as being a meeting of the needs of those who would otherwise be remunerated, with the surplus value then being put into expansion. Im not necessarily committing to a defence of this view, just trying to propose a slightly stronger version of it so you can engage with it more fully.

I didn't say that it's the "only motivation", but one can't deny that profit drives innovation and efficiency.

Perhaps it does. The fact that you recognise that its not the only motivation is enough to warrant an examination of other alternatives, which are less harmful to those whos labour is being profitted from, surely. Do you agree?

I would argue that there is a kind of feedback loop, whereby an excessively profit oriented environment (our current society) engenders a progressively profit motivated populace (to put it extremely neutrally for the purposes of less heated discussion). Hence attempting to promote other motivations and supporting institutions which do not operate along these lines would be a healthy approach to politics, rather than a defence of the harmful status quo. This is all without even considering "socialism" as an alternative, merely supporting certain alternative structures to those which are purely capitalist.

A rival shop-owner may sell goods for a lower price in an attempt to increase his market share and, again, benefit the local community by driving prices down.

All well and good till the wages of the people who work for the shop owner are cut in order to pay for this needless competition.

Under a socialist system there is no incentive to innovate or to increase efficiency, as history has shown us.

This is where those alternative motivations from above enter in to it. Motivations like wanting to heal people, offer quality food, enjoying your work etc

So after a hard weeks's graft chopping down trees I can just head into town on my weekend off and help myself to "free" everything? Mansions, ferraris, truffles, champage -- you name it, it's all free!

If those whos labour have gone in to making such luxuries, if people see fit to still make them when given the option of making something else instead, see fit that you should be able to revel in them.

Socialism doesn't even work in theory because it is built on a foundation of economic fallacies.

Im not sure what these "fallacies" are, and I wont even bother responding to the other point, but I think some of them may appear to be so due to a misunderstanding of "efficiency"'s proper place in production.

Efficiency is a word which can be used to describe the level of adaptedness of a process' functioning, to its goal, right? Hence it is not a goal to which we should adapt society to, in itself. Rather an evaluation of our goals should be made, and then a determination of whether adaptation to these goals as it exists now is undermined by the religious fervour to which we currently adhere to them, to the expense of everything else in society.

To put it in less abstract terms; the wellbeing of humans (or possibly life on earth) should be our goal. If "efficiency" in production and distribution comes at the expense of the wellbeing of the human beings who currently cause this "efficiency" to occur, then clearly we need to look again at why we want to be so efficient.

Soldie

Gary L made a contradiction, and I pointed it out by saying this:

What surplus? Everyone is being remunerated to the full value of their labour, and everything is free. There is no surplus.

I said the above in relation to the socialist society as hypothesized in the original post. Iwasfrozen then started talking about capitalism, when that has nothing to do with this thread whatsoever. What he said was coherent in that it is compatible with Marx's views, yes, but totally irrelevant to this particular discussion.

The theory of surplus value itself is nonsense because it is built on the labour theory of value, which has been debunked. Workers' allegedly low wages are due to time preference.

This bit I agree with. However I would hazard a guess of a way out of the problem along the lines of stepping outside the conception of remuneration as being in the form of a wage, and rather as being a meeting of the needs of those who would otherwise be remunerated, with the surplus value then being put into expansion. Im not necessarily committing to a defence of this view, just trying to propose a slightly stronger version of it so you can engage with it more fully.

Where is the money going to come from for that other form of remuneration?

Perhaps it does. The fact that you recognise that its not the only motivation is enough to warrant an examination of other alternatives, which are less harmful to those whos labour is being profitted from, surely. Do you agree?

That's quite a loaded question in that it rests on the debunked theory of surplus value. I don't see voluntary labour as being harmful or exploitative.

I would argue that there is a kind of feedback loop, whereby an excessively profit oriented environment (our current society) engenders a progressively profit motivated populace (to put it extremely neutrally for the purposes of less heated discussion). Hence attempting to promote other motivations and supporting institutions which do not operate along these lines would be a healthy approach to politics, rather than a defence of the harmful status quo. This is all without even considering "socialism" as an alternative, merely supporting certain alternative structures to those which are purely capitalist.

The issue I take with this is that you're critiquing pure or unfettered capitalism, when in reality we have a centrist economy. I'm sure some people would take issue with me lambasting socialism in the same way. In From Mutual Aid to the Welfare State: Fraternal Societies and Social Services, 1890-1967, David Beito argues that the redistributionist welfare state has had drastic effects on private charity in the US. If you're a high-earner in Ireland, you could be paying 53% tax on your income. Is it any wonder that charitable institutions in Ireland are struggling when the government is confiscating such large amounts of wealth?

All well and good till the wages of the people who work for the shop owner are cut in order to pay for this needless competition.

This isn't what happens, though, it's just an emotive claim. Market competition has the effect of driving prices down, and wages up.

This is where those alternative motivations from above enter in to it. Motivations like wanting to heal people, offer quality food, enjoying your work etc

Are those other motivations going to create a situation where "working class" people can afford cars, LCD TVs, holidays abroad, etc.?

If those whos labour have gone in to making such luxuries, if people see fit to still make them when given the option of making something else instead, see fit that you should be able to revel in them.

I think the East German trabant has demonstrated that luxuries are few and far between in socialist societies!

Im not sure what these "fallacies" are, and I wont even bother responding to the other point, but I think some of them may appear to be so due to a misunderstanding of "efficiency"'s proper place in production.

The major economic fallacies are the labour theory of value, surplus value, and socialist calculation.

Efficiency is a word which can be used to describe the level of adaptedness of a process' functioning, to its goal, right? Hence it is not a goal to which we should adapt society to, in itself. Rather an evaluation of our goals should be made, and then a determination of whether adaptation to these goals as it exists now is undermined by the religious fervour to which we currently adhere to them, to the expense of everything else in society.

To put it in less abstract terms; the wellbeing of humans (or possibly life on earth) should be our goal. If "efficiency" in production and distribution comes at the expense of the wellbeing of the human beings who currently cause this "efficiency" to occur, then clearly we need to look again at why we want to be so efficient.

Don't focus so much on the word efficiency. A collective cannot have goals and aspirations, only an individual can. Having said that, I'd say that a large number of people aim for the wellbeing of humans. As this presentation shows, it is capitalism that leads to the wellbeing of humans.

Iwasfrozen

Soldie wrote: »

I didn't say that it's the "only motivation", but one can't deny that profit drives innovation and efficiency. Consider a shop-owner who expands his shop in order to increase profits, and in doing so benefits the local community by making a larger number of goods available to them. A rival shop-owner may sell goods for a lower price in an attempt to increase his market share and, again, benefit the local community by driving prices down. Under a socialist system there is no incentive to innovate or to increase efficiency, as history has shown us.

As Joycey pointed out this is all well and good untill we look at the worker who must suffer a pay cut due to the managers greed.
What's more we must remember that in a socialist society there will not be any prices because such items will be free.

Soldie wrote:

So after a hard weeks's graft chopping down trees I can just head into town on my weekend off and help myself to "free" everything? Mansions, ferraris, truffles, champage -- you name it, it's all free!

Marx's ideal in this situation can be leveled down to "From each according to his ability, to each according to his need" meaning that in a socialist society each person shall work according to their ability and recieve according to their needs.

Soldie wrote:

This is completely incorrect, but let's ignore that. Socialism doesn't even work in theory because it is built on a foundation of economic fallacies.

What is incorrect ? That socialism hasn't beed tried ?
Perhaps you would like to point out a truely Marxist socialist society ?

Iwasfrozen

Bonkey wrote:

For me, one of the biggest problems with a practical test of democratic socialism, as proposed, is that it requires "buy in" from people who would otherwise be better off. While such altruistic individuals can almost-certainly be found, what happens when the test becomes generational? When we move to the children of such people, what then? If they do not have the same altruism, then sooner-or-later, the society faces stresses from those who didn't choose this society, and who would be better off elsewhere.

People can come and go as they like, it isn't prison.
If enough people leave that the society is no longer workable then so be it, the people have made up their mind and the experiment has failed.

Bonkey wrote:

Similarly, its possible (although unlikely, I would guess) to create such a society where every participant is honest...where they all want to play according to the tules, rather than try and game the system one way or another. Again, move generationally, or even just across some years, and you will have people who figure that they can have a better level of satisfaction by contributing less but still receiving their "fair" share.

I think Marx's quote again comes into play here:
From each according to his ability, to each according to his need, meaning that every person shall work as hard as they can and recieve what they need. If they do not work, they do not recieve.

Lenin also made a strong quote in relation to this:

Lenin wrote:

And if you exploiters attempt to offer resistance to our proletarian revolution we shall ruthlessly suppress you; we shall deprive you of all rights; more than that, we shall not give you any bread, for in our proletarian republic the exploiters will have no rights, they will be deprived of fire and water, for we are socialists in real earnest, and not in the Scheidemann or Kautsky fashion.

A little harsh I know, but it solves the sponge problem.

Soldie

Iwasfrozen wrote: »

As Joycey pointed out this is all well and good untill we look at the worker who must suffer a pay cut due to the managers greed.

Just think about that for a second and consider whether it actually corresponds to reality. I urge you to offer some reasonable critique of free markets -- critique that is grounded in economics, not emotive drivel.

What's more we must remember that in a socialist society there will not be any prices because such items will be free.

This is one of the major failings of socialism. The absence of a price mechanism means that the allocation of resources is extremely inefficient. When everything is collectively owned no prices can be obtained because goods are merely redistributed internally, so it is impossible for a socialist economy to know what the best use of a good is. It never ceases to amaze me when people trot out the same economic fallacy time and time again -- the concept was debunked in the 1920s, it's not a recent development! It has even been demonstrated in Cuba and the Soviet Union, with drastic shortages and queuing. Before the howls of "that's not socialism!" begin, the point is that the means of production were collectivised, and whether they're collectivised under a dictatorsip or a hippie commune is irrelevant.

Marx's ideal in this situation can be leveled down to "From each according to his ability, to each according to his need" meaning that in a socialist society each person shall work according to their ability and recieve according to their needs.

And what happens when you run out of those with the "ability [to pay]"?

What is incorrect ? That socialism hasn't beed tried ?
Perhaps you would like to point out a truely Marxist socialist society ?

I'm not going to get sucked into a "The Soviet Union wasn't socialist", "Yes it was", etc. ad infinitum debate and reiterate my previous point that socialism doesn't even work in theory.

bonkey

Iwasfrozen wrote: »

People can come and go as they like, it isn't prison.

Yes, but that holds true of any society. The reality is, however, that there will always be individuals who believe that they have the right to stay in "their" society, and that "their" society should accomodate their wants.

These are the stresses that real-world societies face, and the stresses that I was pointing out. I am merely pointing out why a short-term experiment, run by idealists, will not face some/many of the challenges that really test a societal model.

I think Marx's quote again comes into play here:
From each according to his ability, to each according to his need, meaning that every person shall work as hard as they can and recieve what they need. If they do not work, they do not recieve.

How do you judge ability or need? If someone is chronically lazy, then does that hamper their ability, or is it just tough luck on them? If they are chronically greedy, then should their needs cater for that? How can you objectively determine what someone can really contribute? If I spend half my time skiving off, but still convince my boss that I'm doing a good job....do I get punished for not working to my ability, or rewarded for conning people that 50% of my capability is, in fact, my ability?

Who judges need? What forces them to be fair? If resources permit greater availability then there is a need for, then what? Do we force people to no longer contribute according to their ability, in order to decrease availability? Do we give people more then they need?

Lenin also made a strong quote in relation to this:

A little harsh I know, but it solves the sponge problem.

No, it doesn't.

Again, I refer to my example....I'm skiving off but still convincing people that I'm doing a good job. I'm exploting the system...not contributing all that I can, but still taking my full share. Lenin's brutality doesn't solve that...but it does allow my boss to decide that someone who's working their ass off could be punished because they can't keep up with me and are therefore eploiting the system by not pulling their weight.

There are no easy solutions...thats the real problem.

Iwasfrozen

Soldie wrote: »

Just think about that for a second and consider whether it actually corresponds to reality. I urge you to offer some reasonable critique of free markets -- critique that is grounded in economics, not emotive drivel.

The fact that you think privately owned businesses pushing forword to benefit the owners while systematically lowering the standered of living for their workers shows your personality.
But however if it is critique of free markets you want, then it is the critique of free markets you shall get:

Imperialism:
Lenin argued that Capitalism is the highest form of Imperialism, a quick wikipedia search brought up these five features of free market dominance.

1) Concentration of production and capital has led to the creation of national and multinational monopolies - not as understood in liberal economics, but in terms of de facto power over their enormous markets - while the "free competition" remains the domain of increasingly localized and/or niche markets.

2) Industrial capital as the dominant form of capital has been replaced by finance capital (repeating the main points of Rudolf Hilferding's magnum opus, Finance Capital), with the industrial capitalists being ever more reliant on finance capital (provided by financial institutions).

3) The export of the aforementioned finance capital is emphasized over the export of goods (even though the latter would continue to exist).

4) The economic division of the world by multinational enterprises, and the formation of international cartels

And the one that really hits home:

5) The political division of the world by the great powers, in which the export of finance capital by the advanced capitalist industrial nations to their colonial possessions enables them to exploit those colonies for their resources and investment opportunities. This superexploitation of poorer countries allows the advanced capitalist industrial nations to keep at least some of their own workers content, by providing them with slightly higher living standards.

Marx also outlined his opinion that free market economies would eventually lead to Socialism:
Free competition is the basic feature of capitalism, and of commodity production generally; monopoly is the exact opposite of free competition, but we have seen the latter being transformed into monopoly before our eyes, creating large-scale industry and forcing out small industry, replacing large-scale by still larger-scale industry, and carrying concentration of production and capital to the point where out of it has grown and is growing monopoly: cartels, syndicates and trusts, and merging with them, the capital of a dozen or so banks, which manipulate thousands of millions. At the same time the monopolies, which have grown out of free competition, do not eliminate the latter, but exist above it and alongside it, and thereby give rise to a number of very acute, intense antagonisms, frictions and conflicts. Monopoly is the transition from capitalism to a higher system. (Ch. VII)

I could go one by outlining the opinions of more Marxists but I think I'll leave it there.

Soldie wrote: »

This is one of the major failings of socialism. The absence of a price mechanism means that the allocation of resources is extremely inefficient. When everything is collectively owned no prices can be obtained because goods are merely redistributed internally, so it is impossible for a socialist economy to know what the best use of a good is. It never ceases to amaze me when people trot out the same economic fallacy time and time again -- the concept was debunked in the 1920s, it's not a recent development! It has even been demonstrated in Cuba and the Soviet Union, with drastic shortages and queuing. Before the howls of "that's not socialism!" begin, the point is that the means of production were collectivised, and whether they're collectivised under a dictatorsip or a hippie commune is irrelevant.

Couple of points here:

Communism:
It's not socialism, Marx called for goods to be free after the worldwide revolution in other words when Socialism has given away to Communism.
The thing about Communism is that it is just that, commun-ism. And in a Marxist society the populace is to be de-centralised into communes.

External influences:
Marx and Engles never intended a socialist society to exist side by side with a free market world. Indeed Engles wrote in "The Principles of Communism":

"Will it be possible for this revolution to take place in one country alone?

No. By creating the world market, big industry has already brought all the peoples of the Earth, and especially the civilized peoples, into such close relation with one another that none is independent of what happens to the others. Further, it has co-ordinated the social development of the civilized countries to such an extent that, in all of them, bourgeoisie and proletariat have become the decisive classes, and the struggle between them the great struggle of the day. It follows that the communist revolution will not merely be a national phenomenon but must take place simultaneously in all civilized countries—that is to say, at least in England, America, France, and Germany. It will develop in each of the these countries more or less rapidly, according as one country or the other has a more developed industry, greater wealth, a more significant mass of productive forces. Hence, it will go slowest and will meet most obstacles in Germany, most rapidly and with the fewest difficulties in England. It will have a powerful impact on the other countries of the world, and will radically alter the course of development which they have followed up to now, while greatly stepping up its pace. It is a universal revolution and will, accordingly, have a universal range."

Soldie wrote:

And what happens when you run out of those with the "ability [to pay]"?

What do you mean ? Run out of working adults ? Then the system would collapse just like a capitalist society would.

Soldie wrote:

I'm not going to get sucked into a "The Soviet Union wasn't socialist", "Yes it was", etc. ad infinitum debate and reiterate my previous point that socialism doesn't even work in theory.

I think you will find socialism works very well in theory.

Iwasfrozen

Bonkey wrote:

Yes, but that holds true of any society. The reality is, however, that there will always be individuals who believe that they have the right to stay in "their" society, and that "their" society should accomodate their wants.

These are the stresses that real-world societies face, and the stresses that I was pointing out. I am merely pointing out why a short-term experiment, run by idealists, will not face some/many of the challenges that really test a societal model.

Of course they will face such challenges but they are the challenges any society must face.

Bonkey wrote:

How do you judge ability or need? If someone is chronically lazy, then does that hamper their ability, or is it just tough luck on them? If they are chronically greedy, then should their needs cater for that? How can you objectively determine what someone can really contribute? If I spend half my time skiving off, but still convince my boss that I'm doing a good job....do I get punished for not working to my ability, or rewarded for conning people that 50% of my capability is, in fact, my ability?

I think you're missing out on the definition of ability and need.
If someone is lazy then they are not working to the best of their ability, if someone is greedy then they are not receiving to their needs.
People who skiv off as you say you do are a liability to the Capitalist system, they shall remain a liability to the socialist system.

Bonkey wrote:

Again, I refer to my example....I'm skiving off but still convincing people that I'm doing a good job. I'm exploting the system...not contributing all that I can, but still taking my full share. Lenin's brutality doesn't solve that...but it does allow my boss to decide that someone who's working their ass off could be punished because they can't keep up with me and are therefore eploiting the system by not pulling their weight.

Marx said that in a communist society there will be large amounts of excess created by the seizure of surplus production value.
In other words a communist society would be better equipped to support such a persons liability then a capitalist one.

bonkey

Iwasfrozen wrote: »

Of course they will face such challenges but they are the challenges any society must face.

Yes...but there seems to be no explanation ever offered as to how such alternate systems (as the one proposed) will do anything but suffer the same problems that our current society faces from such problems.

Put differently...what does the proposed model offer thats better then what we already have? What would be the impetus to change?

People typically lay the blame of so many of today's problems at the feet of capitalism, and then blame "the system"...hence arriving at the idea that an alternate system is the solution. The thing is, capitalism isn't the problem. THe problem are the stresses its put under...the very stresses you agree are faced by any society.

Thus, the question is not (or should not be) whether or not socialism can work in a utopian ideal, but whether or not it can offer a better way of dealing with these stresses.

I think you're missing out on the definition of ability and need.

Actually, I'm trying to point out that they are subjective concepts, which don't have any clear definition.

If someone is lazy then they are not working to the best of their ability, if someone is greedy then they are not receiving to their needs.
People who skiv off as you say you do are a liability to the Capitalist system, they shall remain a liability to the socialist system.

In IT, its reckoned that the best performers outperform the average by at least a factor of 10.

Lets say I'm one of those best performers, but I'm also lazy. I outperform the average by a factor of 5. In a capitalist society, I am rewarded for performing well above average and reap the benefit of slacking off.

What is a socialist society going to do about that? Will I be punished for only being 5 times better then average? Who will determine the full extent of my capabilities, to say that I should be 10 times better then average?

Marx said that in a communist society there will be large amounts of excess created by the seizure of surplus production value.

But was Marx right? What reason do we have to believe that there would be large amounts of excess?

Why should people be forced to contribute to generate excess, which is then seized? Why not slack off, and cease generating surplus? You don't lose out individually in terms of your share of production, but you gain from decreased labour.

Again, it seems to be a case that Marx's ideal is just that...an ideal. It seems to require a fundamental shift in human nature...that the vast majority of participants are willingly altruistic in nature. Of course, with a vast majority of altruistic participants, any system will appear attractive, because it doesn't face the challenges that you've already accepted as intrinsic to all systems

In other words a communist society would be better equipped to support such a persons liability then a capitalist one.

You misunderstood the situation I'm describing. A sufficiently above-average performer can contribute well below their ability and still be above average. What incentive do they have to do otherwise? In capitalism, the better they are, the more they stand to be rewarded. In socialism, the better they are, the more others gain from them.

potlatch

I don't think it's correct to say that, in a socialist schema, things would be 'free'.

What would be different would how the human notions 'value' and 'price' would be conceptualised and created.

If you read the first 200 pages of Capital Vol. I, you'll see Marx examining this conundrum. The original poster is proposing a different 'social relation'.

However, there's confusion in this thread about what 'value' and 'price' are. Under the capitalist social relation/mode of production (one of many possiblities), Marx looks at the commodity as the condensation of capitalism. The commodity contains, in inner relation, three forms of value: use value (the importance of a good derived from its usefulness to the bearer/desirer); exchange value (the point at which a person will swap a good for another of perceived equivalent value) and value (labour value, or the time taken for a person to produce such a good). These forms of value are held together in tension within the commodity under a capitalist mode of production. This gives rise to the concept of 'price' which is different to value - it is a shadow of value, but it is always based on a combination of the above value forms.

Because money is the 'universal exchange value', it permits price to be set across one-on-one barter interactions and across time in the sense that it can be saved (in Marx's terminology, 'hoarded'). Money is not a normal commodity (here Marx raises the concept of commodity fetishism).

Now, under socialism and a socialist mode of production (assuming it can exist for a moment), it is not that things would be perceived as 'free'. Rather, people would have different collective concepts of value. The difficulty that arises is how to set price in a situation where money does not function. Or, perhaps, the universal exchange commodity, money, would be restructured. Even heterodox capitalist economists wonder if money as currently structured around debt should not be redesigned (but this would not be in the interests of banks). The history of money is very interesting.

Anyway. This debate has to get its head around the idea we as human beings cannot escape concepts of value, and therefore even in a socialist framework, the issues of price and exchange cannot be ignored. Equally, it shows the dividing lines between capitalism and communism - one motivated by the private property and profit principles and the other not.

Soldie

Iwasfrozen wrote: »

But however if it is critique of free markets you want, then it is the critique of free markets you shall get:

What I asked for: critique that is grounded in economics.

What I got: an ill-conceived list of things you mistakenly attribute to the free-market.

I'm aware now that I shouldn't have even asked you a critique of free markets, because it's completely unrelated to the thread topic. Let's not derail the thread any further by turning this thread into another archetypal capitalism versus socialism brawl. If you want to talk about capitalism then start a new thread.

Communism:
It's not socialism, Marx called for goods to be free after the worldwide revolution in other words when Socialism has given away to Communism.
The thing about Communism is that it is just that, commun-ism. And in a Marxist society the populace is to be de-centralised into communes.

Non sequitur. I haven't said "communism" once in this thread.

External influences:
Marx and Engles never intended a socialist society to exist side by side with a free market world. Indeed Engles wrote in "The Principles of Communism":

"Will it be possible for this revolution to take place in one country alone?

No. By creating the world market, big industry has already brought all the peoples of the Earth, and especially the civilized peoples, into such close relation with one another that none is independent of what happens to the others. Further, it has co-ordinated the social development of the civilized countries to such an extent that, in all of them, bourgeoisie and proletariat have become the decisive classes, and the struggle between them the great struggle of the day. It follows that the communist revolution will not merely be a national phenomenon but must take place simultaneously in all civilized countries—that is to say, at least in England, America, France, and Germany. It will develop in each of the these countries more or less rapidly, according as one country or the other has a more developed industry, greater wealth, a more significant mass of productive forces. Hence, it will go slowest and will meet most obstacles in Germany, most rapidly and with the fewest difficulties in England. It will have a powerful impact on the other countries of the world, and will radically alter the course of development which they have followed up to now, while greatly stepping up its pace. It is a universal revolution and will, accordingly, have a universal range."

Non sequitur.

I think you will find socialism works very well in theory.

How can a socialist economy allocate resources efficiently without a price mechanism?

Iwasfrozen

Soldie wrote: »

What I asked for: critique that is grounded in economics.

No, you asked for critique of the free market. Which is what you got, and now you can't engage in it so you are back-tracking.

Soldie wrote:

What I got: an ill-conceived list of things you mistakenly attribute to the free-market.

Not I, Lenin.
And I think you'll find I was not mistaken.

Soldie wrote:

Non sequitur. I haven't said "communism" once in this thread.

You are mistakingly attributing features of communism with socialism. It is important that we outline the differences. According to Marx Socialism must precede communism just as capitalism must precede socialism.

A quick wiki search brought up the following difference:
For orthodox Marxists, socialism is the lower stage of communism based on the principle of "from each according to his ability, to each according to his contribution" while upper stage communism is based on the principle of "from each according to his ability, to each according to his need"; the upper stage becoming possible only after the socialist stage further develops economic efficiency and the automation of production has led to a superabundance of goods and services.

Soldie wrote:

Non sequitur.

Again you failed to see the meaning to my post, so I see that I am going to have to spell in out black and white:
Isolationist Socialist nations such as those started in Cuba and the Soviet Union where never ment to be, Stalin's idea of "Socialism in one country" diverged from Marxist-Leninist doctrain and as such the countries cannot be considered to have been communist.

Soldie wrote:

How can a socialist economy allocate resources efficiently without a price mechanism?

http://en.wikipedia.org/wiki/Marxian_economics

Iwasfrozen

bonkey wrote: »

Yes...but there seems to be no explanation ever offered as to how such alternate systems (as the one proposed) will do anything but suffer the same problems that our current society faces from such problems.

What problems ? Marx and Engels outline a number of solutions to a number of problems that the capitalist system faces.

bonkey wrote:

Put differently...what does the proposed model offer thats better then what we already have? What would be the impetus to change?

If I where to outline everything that's wrong with capitalism and how socialism fixes them then I would be here for a long time.
But put simply Capitalism focuses solely on the acquisition of wealth and only the acquisition of wealth, in doing so large coroperations have no moral duty except to provide a dividend for their shareholders.
Considering some coroperations have a GDP greater then soem large countries is scary.

bonkey wrote:

People typically lay the blame of so many of today's problems at the feet of capitalism, and then blame "the system"...hence arriving at the idea that an alternate system is the solution. The thing is, capitalism isn't the problem. THe problem are the stresses its put under...the very stresses you agree are faced by any society.

No, capitalism is the problem, it centres the wealth primarily within a small number of the population, what Marx called the bourgeoisie.
Now you might say that that is fine because the government regulates them but when these countries go abroad, to third world countries they exploit the resources and populace of that country. Thus enriching us in the first world and keeping those in the third world down.

bonkey wrote:

Thus, the question is not (or should not be) whether or not socialism can work in a utopian ideal, but whether or not it can offer a better way of dealing with these stresses.

Try reading some of Marx or Engles work, you will find that they do offer solutions that are still relevent to todays world.

bonkey wrote:

Actually, I'm trying to point out that they are subjective concepts, which don't have any clear definition.

The concepts themselves are subjective as all concepts are but Marx has outlined in detail how the concept should be followed.

bonkey wrote:

Lets say I'm one of those best performers, but I'm also lazy. I outperform the average by a factor of 5. In a capitalist society, I am rewarded for performing well above average and reap the benefit of slacking off.

Under Marx's idea of From each according to his ability to each according to his contribution would mean that in socialism, the first stage on the road to communism, you would be rewarded for performing above average.

bonkey wrote:

Why should people be forced to contribute to generate excess, which is then seized? Why not slack off, and cease generating surplus? You don't lose out individually in terms of your share of production, but you gain from decreased labour.

Because then you won't be working to your ability and won't recieve goods according to you contribution.
Here is a link: http://en.wikipedia.org/wiki/To_each_according_to_his_contribution

bonkey wrote:

You misunderstood the situation I'm describing. A sufficiently above-average performer can contribute well below their ability and still be above average. What incentive do they have to do otherwise? In capitalism, the better they are, the more they stand to be rewarded. In socialism, the better they are, the more others gain from them.

Not true, Above average performers are always an asset in any system, in socialism they would be rewarded according to their contribution, rather like in capitalism.

Soldie

Iwasfrozen wrote: »

No, you asked for critique of the free market. Which is what you got, and now you can't engage in it so you are back-tracking.

Read my post -- I asked for "critique that is grounded in economics". None of what you said had anything grounding in ecomomics whatsoever -- it was just waffle about imperialism, capital accumulation, colonialism, and international cartels. You didn't explain how the free market is responsible for the aforementioned phenomena. If you're up to the task of backing up each one of your claims and explaining how, precisely, the free market is responsible, then start a new thread. This thread is about socialism.

You are mistakingly attributing features of communism with socialism. [My emphasis] It is important that we outline the differences. According to Marx Socialism must precede communism just as capitalism must precede socialism.

Again, I haven't said anything about communism in this thread.

Again you failed to see the meaning to my post, so I see that I am going to have to spell in out black and white:
Isolationist Socialist nations such as those started in Cuba and the Soviet Union where never ment to be, Stalin's idea of "Socialism in one country" diverged from Marxist-Leninist doctrain and as such the countries cannot be considered to have been communist.

This is still a non sequitur. What does this have to do with anything that's been said?

http://en.wikipedia.org/wiki/Marxian_economics

So you're not prepared to engage with the point, I take it.

Iwasfrozen

Soldie wrote: »

Read my post -- I asked for "critique that is grounded in economics". None of what you said had anything grounding in ecomomics whatsoever -- it was just waffle about imperialism, capital accumulation, colonialism, and international cartels. You didn't explain how the free market is responsible for the aforementioned phenomena. If you're up to the task of backing up each one of your claims and explaining how, precisely, the free market is responsible, then start a new thread. This thread is about socialism.

Well this is akward, you didn't understand my post yet I can't explain it because if I did I would be going off topic. contradictory, eh ?

Soldie wrote:

Again, I haven't said anything about communism in this thread.

Again you mentioned communism when you said there would be the absence of a price mechanism. Socialism has a price Mechanism.

Soldie wrote:

This is still a non sequitur. What does this have to do with anything that's been said?

I see I'm going to have to explain it even simpler:
You used Cuba and the Soviet Union as examples in your post, neither of which are actually socialist and never were. Because they diverged from Marx's idea of a world wide revolution.
Got it ?

Soldie wrote:

So you're not prepared to engage with the point, I take it.

No I'm not, because the point is frickin huge, if you can pick out areas of the concept you don't understand I can engage with that.
Short of writing a thesis there is no way I could cover all the points of Marxian economics.

rjb80

Very interesting thread, however, the fatal flaw is that it is absolutely necessary for certain people to be rewarded better than others;

Iwasfrozen wrote: »

You may call me naive but imo, saying the only motivation for Doctors is financial is very naive.

You're naive, ok so there's a nobility that comes with being a doctor but what about other professions where there is no satisfaction or status.

I've dealt with a lot of accountants and no way on earth would they study for 7-10 years to be an accountant and spend their life working 9 in the morning till 10 at night looking at spreadsheets all day just to be paid the same as a cleaner.

There are a lot of professions out there that pay high wages so that enough people will chose that career to fill demand and the high pay is the only motiation for them.

potlatch

Iwasfrozen wrote:

Socialism has a price Mechanism.

What's the price mechanism?

magma69

rjb80 wrote: »

Very interesting thread, however, the fatal flaw is that it is absolutely necessary for certain people to be rewarded better than others;



You're naive, ok so there's a nobility that comes with being a doctor but what about other professions where there is no satisfaction or status.

I've dealt with a lot of accountants and no way on earth would they study for 7-10 years to be an accountant and spend their life working 9 in the morning till 10 at night looking at spreadsheets all day just to be paid the same as a cleaner.

There are a lot of professions out there that pay high wages so that enough people will chose that career to fill demand and the high pay is the only motiation for them.

Many Socialists do not believe everyone should make the same wage. It is simply the profits of industry i.e. the means of production, that is spread equally amongst the workers. More skilled workers who bear more responsibility in society would naturally make a larger wage. Employers just would not be able to exploit employees.