A challenge for capitalists

[Stevicus]

There are beans to spill?

Well, I was just speaking hypothetically, since you were asking if you failed to admit anything. Since I haven't read all of your posts, I don't know all that you've admitted to. If, for example, you admitted to being part of a secret alien conspiracy to take over the Earth - and it was in a thread I might have missed, then I could not accuse you of hiding that or failing to admit it. I'm not saying that you've admitted to being part of a secret alien conspiracy, but if you had, I just didn't see it.

Economics has it's hard aspects (quantitative analysis),
but it also has its psychological components. The area
of application matters greatly.
This is rather obvious....hardly something I'd deny.
I speak as one of the capitalists.

Well, it is obvious, yes. An elephant in a room can also be obvious, yet there are those who still seem reluctant to talk about it.

I tend to look at it more in the same way I view political science. When we use a term like "economic system," we're really talking about a political system.

I will admit that I have taken into consideration previous criticisms you may have had, in that sometimes I get a bit too hasty and make it appear like I'm lumping *all* capitalists into the same basket of deplorables. So if I anything I say bothers you or offends on any kind of personal level, please understand that I honestly don't mean to come across that way. I will try to be more careful on how I use my words.

Sometimes, I let my passions get the better of me, and I'll admit that can be a failing at times.

But let's face it: Capitalism is, essentially, a political process. Would you agree with that? Wouldn't that make capitalists into politicians, at least in the generic sense where "politics" involves basic interaction, negotiation, compromise, and contracts? Lawyers are optional, but sometimes they get involved too. At least the big companies devote some of their resources to retaining the best lawyers money can buy.

It just seems incongruous to me, when capitalism is often touted as operating best with minimal government involvement and interference, yet it's really the government and political system being called into question.

I accept that, just as with lawyers and politicians, there are both good capitalists and evil capitalists. It seems to me that it would be in the best interests of the good capitalists to favor a political system which would come down hard upon the "darker side" of the capitalist world.

Commies & socialists on RF generally won't even admit to countries using their systems.

I guess it depends. Everyone has their own particular variation, so they won't necessarily associate themselves with any system they're not personally involved with creating.

 

[sayak83]

I'm not specifically advocating for such a law. A private person can take all his money and flush it down the toilet if he wants.

But the key thing is that they do it because they can. There's no "science" to it at all. It's just based on whimsy, but capitalists refuse to admit this. I just wish they would own up to it and tell the truth.

I think regardless of logic or efficiency, capitalism stems from the fundamental right of ownership of private property gained by socially accepted lawful transactions. Once this is accepted, capitalism is inevitable. The only question that follows is what are the reasonable constraints a society can impose on ownership and disbursal of private property for the advancement of the common good as opposed to individual private good.

 

[Revoltingest]

Well, it is obvious, yes. An elephant in a room can also be obvious, yet there are those who still seem reluctant to talk about it.

Or the topic is so obvious that there's no interest in broaching it.
You could start a thread about it.

I tend to look at it more in the same way I view political science. When we use a term like "economic system," we're really talking about a political system.

One can treat the systems separately.
But if all are conflated, we could take it as far as saying
that it all boils down to physics (for us materialists).

I will admit that I have taken into consideration previous criticisms you may have had, in that sometimes I get a bit too hasty and make it appear like I'm lumping *all* capitalists into the same basket of deplorables. So if I anything I say bothers you or offends on any kind of personal level, please understand that I honestly don't mean to come across that way. I will try to be more careful on how I use my words.

I take no offense.
But I do object.

Sometimes, I let my passions get the better of me, and I'll admit that can be a failing at times.

But let's face it: Capitalism is, essentially, a political process. Would you agree with that?

No.
But there is intersection between government, economics, & psychology.

Wouldn't that make capitalists into politicians, at least in the generic sense where "politics" involves basic interaction, negotiation, compromise, and contracts? Lawyers are optional, but sometimes they get involved too. At least the big companies devote some of their resources to retaining the best lawyers money can buy.

Or we're all psychologists because those things all involve psychology.

It just seems incongruous to me, when capitalism is often touted as operating best with minimal government involvement and interference, yet it's really the government and political system being called into question.

I accept that, just as with lawyers and politicians, there are both good capitalists and evil capitalists. It seems to me that it would be in the best interests of the good capitalists to favor a political system which would come down hard upon the "darker side" of the capitalist world.



I guess it depends. Everyone has their own particular variation, so they won't necessarily associate themselves with any system they're not personally involved with creating.

When separate fields are combined, & claimed to all be the
same, it makes discussion as difficult as nailing Jello to a wall.

 

[Stevicus]

When separate fields are combined, & claimed to all be the
same, it makes discussion as difficult as nailing Jello to a wall.

Perhaps so, but when we're talking about the political system, it does tend to connect to other areas. And yes, it might also involve psychology, sociology, philosophy. The study of economics also permeates into other fields, too.

A lot of fields do overlap into each other. I don't see anything wrong with it.

 

[Revoltingest]

A lot of fields do overlap into each other. I don't see anything wrong with it.

Because separating systems allows separate analysis & better understanding.

 

[Heyo]

What I think is even more disturbing is not what CEOs make, but what they make when they get fired.
Where else in the entirety of the business world do you see that happen?

Exhibit A: https://www.bizjournals.com/chicago...-fired-ceo-easterbrook-severance-package.html

If I was a CEO, I'd be smiling too as I can make a luxurious living off of just by being fired.

They call it severance package, I call it hush money.

 

[Stevicus]

Because separating systems allows separate analysis & better understanding.

True, although sometimes one has to look at the bigger picture and how all these "separate" things interact and fit together.

 

[Revoltingest]

True, although sometimes one has to look at the bigger picture and how all these "separate" things interact and fit together.

True dat.

 

[Tambourine]

A private person can give his money to anybody he/she wants. Same for company I guess. It's the company's money.

So laws against bribery violate basic human rights?
For what it's worth, I don't think it's useful to conflate companies with people here.

For the most part, companies aren't people, they are legal constructs that we treat as if they were people for the purpose of lowering the risk and other hurdles to capital investment and capital accumulation.

I think regardless of logic or efficiency, capitalism stems from the fundamental right of ownership of private property gained by socially accepted lawful transactions. Once this is accepted, capitalism is inevitable. The only question that follows is what are the reasonable constraints a society can impose on ownership and disbursal of private property for the advancement of the common good as opposed to individual private good.

I would contend that it stems from the fundamental right of private ownership of the means of production. Almost all human cultures allow for private property in the form of personal possessions. Not all take the same view on, say, real estate or financial capital.

It is a distinctly capital-c Capitalist (as in, the political ideology rather than the economic class) feature to conflate all forms of possessions, properties, and means of production under the umbrella of "private property".

 

[sayak83]

So laws against bribery violate basic human rights?
For what it's worth, I don't think it's useful to conflate companies with people here.

For the most part, companies aren't people, they are legal constructs that we treat as if they were people for the purpose of lowering the risk and other hurdles to capital investment and capital accumulation.


I would contend that it stems from the fundamental right of private ownership of the means of production. Almost all human cultures allow for private property in the form of personal possessions. Not all take the same view on, say, real estate or financial capital.

It is a distinctly capital-c Capitalist (as in, the political ideology rather than the economic class) feature to conflate all forms of possessions, properties, and means of production under the umbrella of "private property".

I don't see the distinction. Any property can be the means of production. A hammer for example is my property and a means of production.
As I said... reasonable constraints on use of property may be justified for common good ( or harm avoidance). Bribery, or knifing your enemy etc. are some of them.

 

[Ponder This]

So, here is the challenge, for those willing to accept it.


Capitalists often argue that they're "worth it," that those at the very top who earn exorbitant, obscenely high salaries are worth every penny to whatever organization is paying them that amount. This argument seems to imply that an organization might lose money (or be diminished in some other way) if they don't pay some executive a ridiculously high salary.


Well, I would just like to see what this would look like in writing, showing the math.


I found a list of the highest paid CEOs (Who Was the Highest Paid American CEO in 2018?). It's a little less than a year old, but it still should be current enough for this exercise.


Let's take number 3 on the list, Bob Iger, CEO/Chairman of Walt Disney Co., whose compensation in 2018 was $146,616,652. That's $70,488.78 per hour, based on a 40-hour work week.


What, exactly, is the message they're sending by paying such a huge salary? Is this guy so incredibly talented and indispensible that they just had to have him as CEO? Are they saying that they would lose money if they hired someone else for less? How do they calculate something like that? What if they got someone who's a little less qualified who's willing to take less?


For example, say they got someone to take the job at $10,000,000 a year (which is still obscenely high, but nevermind). Disney would save $136,616,652, but by paying Iger what they're paying him, they're essentially saying that, without his leadership, the company would end up losing whatever is they'd be saving and be worse off financially.


Again, how do they calculate this? Is there some kind of secret accountant's formula they use? If anyone knows the answer to this, I'm genuinely curious. It sounds like it's just stupidity, greed, and manipulation, but if there truly is a rational, scientifically provable explanation, I'd love to see it (and I'd love to look at the math).


According to his Wiki article, Bob Iger has a BS degree in radio and TV from Ithaca College. No other education to speak of, and he's certainly not the creator and founder of the company named after Walt Disney. It wasn't his vision that built Disneyland or Disney World. So, what makes him worth that much to that organization?


Of course, I'm not necessarily expecting that anyone here would know the inner workings of the Walt Disney Co., although if you're familiar with any other company with a similar situation, I'd be interested in hearing your comments.


If a bachelor's degree is all it takes to be a CEO, then why doesn't everyone with bachelor's degrees earn $146 million per year? Another commonly used capitalist argument is that the big money goes to those with the best skill sets, and that if one is not making much money, then it's because their skills are not useful or valuable.


In comparison, I've read that the average neurosurgeon makes about $500,000 a year, which is decent, and commensurate with the required skills, education, and the actual work involved. There are also very few people who can actually do that job, so there are actual shortages in qualified people.


In contrast, I would seriously doubt that any company would have trouble finding someone qualified to be a CEO, so I'm sure they would have plenty of applicants for the job. Everybody wants to be the boss, so there's plenty of people wanting the job, and many of them probably have bachelor's degrees in something or other. In terms of supply and demand, the supply of available personnel to be CEO is probably greater than that of the supply of qualified neurosurgeons.


So, all you capitalists and self-proclaimed experts in the study of economics, this is your challenge. Please show your work. Take any CEO or any other high-salaried individual and prove that they're actually "worth it" and that they're somehow so much more valuable and useful to the well-being of the United States. Prove that their skill set (and whatever it is they create or produce, if anything) is actually worth that much more than the skill set of a minimum wage worker (or even a neurosurgeon).


Who has more practical use to the United States? The CEO of Disney, or 293 neurosurgeons?

It seems to me that this is a challenge for socialists because capitalists say that trade and industry should be controlled by private owners for profit, whereas socialists say the means of production, distribution, and exchange should be owned or regulated by the community as a whole.

 

[Stevicus]

It seems to me that this is a challenge for socialists because capitalists say that trade and industry should be controlled by private owners for profit, whereas socialists say the means of production, distribution, and exchange should be owned or regulated by the community as a whole.

Not really, since capitalists often pride themselves on their ability to be salesmen.

If someone expects $100,000 for a Pet Rock and thinks it's "worth it," I want to hear the sales pitch. I want to hear the justification. That's part of what this thread was about.

 

[Ponder This]

Not really, since capitalists often pride themselves on their ability to be salesmen.

If someone expects $100,000 for a Pet Rock and thinks it's "worth it," I want to hear the sales pitch. I want to hear the justification. That's part of what this thread was about.

Hmm, perhaps the challenge should be to salesmen? Or to CEOs? You seem to imply in your OP that all capitalists are CEOs, but... they aren't.

According to the article you linked:

“Mr. Iger has delivered exceptional value for the company, its shareholders and employees: Disney’s market capitalization has increased 433% to $244 billion during his tenure, and the stock is trading at record highs,” a Disney spokesman said in an email.​

When you look at where all the money Bill Iger earned in 2018 came from, you see $108,264,774 in Acquisition Awards. That's why he was able to place 3rd in terms of highest paid CEOs and Executives.

So when you ask if someone expects $100,000 for a Pet Rock, the question for you is: Does the Pet Rock increasing the market capitalization of a company?

In other news, on February 25, 2020, Iger announced he would step down as CEO of The Walt Disney Company effective immediately, naming Bob Chapek, chairman of Disney Parks, Experiences and Products, as his successor, making him the 7th CEO in the company's history.
It seems that Bob Chapek is being paid much less than Bill Iger was salary-wise. Huh... so... is the system working as intended? You suggested he should be replaced by someone paid less... and that's exactly what has happened.

 

[Stevicus]

Hmm, perhaps the challenge should be to salesmen? Or to CEOs? You seem to imply in your OP that all capitalists are CEOs, but... they aren't.

They're all in business to make money.

According to the article you linked:

“Mr. Iger has delivered exceptional value for the company, its shareholders and employees: Disney’s market capitalization has increased 433% to $244 billion during his tenure, and the stock is trading at record highs,” a Disney spokesman said in an email.​

When you look at where all the money Bill Iger earned in 2018 came from, you see $108,264,774 in Acquisition Awards. That's why he was able to place 3rd in terms of highest paid CEOs and Executives.

So when you ask if someone expects $100,000 for a Pet Rock, the question for you is: Does the Pet Rock increasing the market capitalization of a company?

In other news, on February 25, 2020, Iger announced he would step down as CEO of The Walt Disney Company effective immediately, naming Bob Chapek, chairman of Disney Parks, Experiences and Products, as his successor, making him the 7th CEO in the company's history.
It seems that Bob Chapek is being paid much less than Bill Iger was salary-wise. Huh... so... is the system working as intended? You suggested he should be replaced by someone paid less... and that's exactly what has happened.

I just picked him as an example, but there are plenty of others.

Does the CEO really deserve that much credit in a company of over 200,000 employees? If so, then prove it, if you can.

 

[Ponder This]

They're all in business to make money.



I just picked him as an example, but there are plenty of others.

Does the CEO really deserve that much credit in a company of over 200,000 employees? If so, then prove it, if you can.

Yeah, I think not. You might say that a neurosurgeon earns about $500,000 a year on average, but you know that the amount of business that neurosurgeon is doing is so small compared to the amount that a big company like Walt Disney does. It's not even comparable. And even so there are neurosurgeons who earn millions of dollars a year.

I'm not sure how you intend to compare the earnings of the CEO to the earnings of 200,000 other employees. Maybe those employees are earning about $4 billion altogether? Is there any sort of substantive argument that you can make that the CEO of the company doesn't deserve what he's earning?

I don't think there's really anything to prove here. You might be able to make an argument that specific CEOs are over or underpaid (you can argue the same thing about anyone else), but you can't easily assail the notion that they generally ought to make as much as they do when they are running such huge companies that make so many millions of dollars and have hundreds of thousands of employees. How could they possibly not have justified million dollar salaries?

 

[TagliatelliMonster]

Okay, this seems a reasonable position to take. I also agree that a mixed system could work. I think perhaps a restrained capitalism could work, but that's where a lot of capitalists tend to balk and argue passionately against any kind of governmental restrictions or interference in the free market. They tend to argue that the free market should be allowed to run its course, and (presumably) everything will be alright.

As far as the U.S. being a capitalist country, this is basically true, although we're more than just that. There are many capitalist countries in the world, and while a few do well (such as the US and a few others), most do not. The U.S. may have a lot going for it, but not necessarily because we're capitalist. It's not the "system" which has made us what we are.

I wouldn't interfere in the free market to much, aside from necessary regulations (to ensure fair competition etc).


Instead, I'ld "restrict" capitalism by taxing an insane amount on income that surpasses a certain absurd height. And I'ld also exempt income in that range from taxes, for those amounts that are invested in public projects of one kind or another, which are helpfull / usefull one way or the other for society. Be it charities or taking part in investments for school infrastructure, heck... even investing in road repair projects.

Some sort of "either you get taxed 70% (or whatever), or you invest the money in others". The 70% would still be invested in society through government spending. The only difference would be that the extremely rich doesn't get to choose on what it is being spend.

So if 1 billion is subject to this rule, the rich person can choose to invest it all, or some of it, in society. The rest of the money, if any, gets taxed for some high amount and the remainder can be kept.

And I'ld put that margin quite high as well. I don't mind billionaires at all. I in fact consider them quite important in society, for innovation and new types of businesses for which huges sums of money are required.

For example, try starting a company like SpaceX with the budget of the average middle-class Joe.
You need people who can afford to burn a couple 100 million for such things, with no prospect of getting it back in the next one or 2 decades...

So, people having the freedom to be filthy rich, is a really imporant aspect of innovantion, expanding markets, competition etc.

But I feel like there is some kind of line where at some point it just crosses over into perverse...

Like Jeff Bezos' fortune. That is just sick imo.
What can you do with 130 billion, that you can't do with 10? Seriously?
Well... okay... with 130 billion, you could buy a country - citizens included.

 

[Stevicus]

I wouldn't interfere in the free market to much, aside from necessary regulations (to ensure fair competition etc).

I would probably be more concerned with protections for workers and consumers.

Instead, I'ld "restrict" capitalism by taxing an insane amount on income that surpasses a certain absurd height. And I'ld also exempt income in that range from taxes, for those amounts that are invested in public projects of one kind or another, which are helpfull / usefull one way or the other for society. Be it charities or taking part in investments for school infrastructure, heck... even investing in road repair projects.

Some sort of "either you get taxed 70% (or whatever), or you invest the money in others". The 70% would still be invested in society through government spending. The only difference would be that the extremely rich doesn't get to choose on what it is being spend.

So if 1 billion is subject to this rule, the rich person can choose to invest it all, or some of it, in society. The rest of the money, if any, gets taxed for some high amount and the remainder can be kept.

And I'ld put that margin quite high as well. I don't mind billionaires at all. I in fact consider them quite important in society, for innovation and new types of businesses for which huges sums of money are required.

For example, try starting a company like SpaceX with the budget of the average middle-class Joe.
You need people who can afford to burn a couple 100 million for such things, with no prospect of getting it back in the next one or 2 decades...

So, people having the freedom to be filthy rich, is a really imporant aspect of innovantion, expanding markets, competition etc.

But I feel like there is some kind of line where at some point it just crosses over into perverse...

Like Jeff Bezos' fortune. That is just sick imo.
What can you do with 130 billion, that you can't do with 10? Seriously?
Well... okay... with 130 billion, you could buy a country - citizens included.

The main reason I started this thread was because I constantly hear arguments from those who tend to be pro-capitalist and demonstrate severe reactions to socialism (even in a mixed economy like the U.S.). The whole reason Obamacare turned out to be such a debacle was because of having to placate so many with "Socialist Derangement Syndrome" (such as believing that socializing medicine in the U.S. would suddenly turn us into North Korea).

A lot of these pro-capitalist types insist that the system is "fair" and that the rewards go to those who are the smartest, most talented, and/or the hardest workers. Their argument insinuates that everyone who is rich deserves it, because they're "worth it" and warn of dire consequences if they were somehow not able to do that. The other side of the argument is that those who are poor or lower class are that way because they deserve it, because they don't have the smarts or the skills, or that they're lazy, shiftless bums. Likewise, capitalists warn of dire consequences if these people were given an increase in pay - or at least an increase in the minimum wage.

I think that this mentality is derived from earlier ways of thinking when the bluebloods thought they were "divine" and "blessed" and that God intended them to be born into a higher class in society. Nobles and aristocrats used to think this way, and it seems the same line of thinking goes into how capitalists justify themselves and their preferred economic system. But it's more like social Darwinism, and capitalists seem to believe that any kind of government interference or socialism would somehow upset the "natural order" that exists in their mind.

That's why I started this thread, just to see if I was wrong.

 

[Heyo]

I would probably be more concerned with protections for workers and consumers.



The main reason I started this thread was because I constantly hear arguments from those who tend to be pro-capitalist and demonstrate severe reactions to socialism (even in a mixed economy like the U.S.). The whole reason Obamacare turned out to be such a debacle was because of having to placate so many with "Socialist Derangement Syndrome" (such as believing that socializing medicine in the U.S. would suddenly turn us into North Korea).

A lot of these pro-capitalist types insist that the system is "fair" and that the rewards go to those who are the smartest, most talented, and/or the hardest workers. Their argument insinuates that everyone who is rich deserves it, because they're "worth it" and warn of dire consequences if they were somehow not able to do that. The other side of the argument is that those who are poor or lower class are that way because they deserve it, because they don't have the smarts or the skills, or that they're lazy, shiftless bums. Likewise, capitalists warn of dire consequences if these people were given an increase in pay - or at least an increase in the minimum wage.

I think that this mentality is derived from earlier ways of thinking when the bluebloods thought they were "divine" and "blessed" and that God intended them to be born into a higher class in society. Nobles and aristocrats used to think this way, and it seems the same line of thinking goes into how capitalists justify themselves and their preferred economic system. But it's more like social Darwinism, and capitalists seem to believe that any kind of government interference or socialism would somehow upset the "natural order" that exists in their mind.

That's why I started this thread, just to see if I was wrong.

I just created a follow-up OP based on your questions.
Tax the Dead!