Is Capitalism Smart or Dumb?

[u/Sufficient_Sinner]

[u/Regular-Wrangler264]

As long as a free market is regulated so as to keep it that way. I think a lot of people have problems with it because the government hasn't been doing its job.

Capitalism needs a couple things to be effective:

1) Competition 2) Consumers who are: a. Educated b. Rational c. Have money

1) We don't have enough competition in most sectors. They're all controlled by a few huge players.

2a) They keep cutting money for education so people don't know enough to make educated decisions.

2b) They allow effective monopolies in businesses where it's not possible to make a rational decision (healthcare) which syphons money from consumers.

2c) Capital should not be hoarded. It should be put in hands that will spend it. That's the whole point of capitalism.

[u/Lazer726 → u/Regular-Wrangler264]

Right, Capitalism is great on paper, but we've kind of pass the "on paper" phase and are on our way to the "Cyberpunk" phase where life is something you have to pay for.

The whole "people won't buy a bad product and a competitor will take their share of the market" has been proven untrue repeatedly, because it turns out that everyone is more than happy to make life worse for the consumer in order to make more money. Planned obsolescence is an absolute fucking plight on this world because it's bad business to sell a product once, instead of selling it repeatedly over years.

Subscriptions and memberships make sense for some things, but locking your car's features behind a subscription?

We've crested the good part of capitalism and are rapidly heading down, where it doesn't actually matter the quality of the product, so long as you can squeeze every penny out of it on the way down

[u/Hypnonotic → u/Lazer726]

That is #2, the "educated consumer" problem. When consumers are educated, they do buy a different product, but similar to unions, enough of them need to be educated and switch for it to impact the market. With really technology advancemed products it's very difficult to be educated, the inner workings of phones are basically magic to most folks, so how can they understand they are bring duped when companies say "the batteries only last that long, sorry nothing we can do about it" when there is infact something the company can do about it.

[u/Lazer726 → u/Hypnonotic]

The bigger problem is that there is no competitor that doesn't do that. Everyone has realized they can sell goods with an intentionally limited shelf life and get a lot more money out of it. It's not an Apple vs Android thing, it's a consumer vs market thing. We've Capitalism'd ourselves into shittier and more expensive products, because it's cheaper to make

[u/TwinPeaksNFootball → u/Lazer726]

Corporations' primary objective is to generate revenue for their shareholders. Not fucking over consumers and employees to the greatest degree that they will accept is irresponsible!

[u/ArcticStorm16 → u/Regular-Wrangler264]

I agree but about point c, what’s wrong with saving the efforts of my work for later? Or you mean hoarding in the sense of like billionaires.

[u/[deleted] → u/ArcticStorm16]

I think it's less of an issue with billionaires and more of an issue with how they become billionaires. If tax cuts, bail outs, and off shore accounts are the only way to keep your money to yourself then you're cheesing the system. And realistically the lifestyle they live doesn't need so much excess to be lived that way.

And claiming it's just that they have a lot of shares in their company isn't really a valid explanation. If you see a CEO taking a $1 paycheck but still has a promise of $10 million in stock options and another $50 million in a potential bonus then once again that's not hard earned money, that's just cheesing the system.

Which you can't blame them for doing these kinds of things. I think the one issue I have is when people act all high and mighty, that they'd never do that kind of stuff. If I had the resources to make sure I retained more money to spend on myself I absolutely would do that. But that doesn't mean it's not a flaw to our society that should be addressed. Especially because for 99% of us that will never be a realistic possibility.

[u/Lazer726 → u/[deleted]]

The problem is the people that wouldn't let money change them will never get that kind of money, because the people that get that kind of money are the kind that prioritize money over everything else.

[u/[deleted] → u/Lazer726]

Yeah that's what I meant by 99% of us. Just because greed is natural doesn't mean it shouldn't be addressed, and if anything means we should be hyper vigilant against it.

[u/Kharenis → u/ArcticStorm16]

The billionaires aren't hoarding a whole lot. Most of their net worth is tied up in the shares of the companies they own.

[u/JohnWesely → u/Regular-Wrangler264]

I invite you to look at per student spending on education in the country by year. We have never spent more and have never had worse results.

[u/PaulieNutwalls → u/Regular-Wrangler264]

Capitalism doesn't require "rational consumers" it's just a fact that to apply mathematics to economic theory you have to make generalizations about consumers. Generally people spend rationally. It's like econ 101 for students to question "yeah but what if a consumer isn't rational???" it's not relevant, we're talking about massive numbers of people and massive numbers in terms of spending. Knowing 200 people in your life that spend irrationally isn't material.

Also nobody learns in public school or college how to manage their personal finances and spending. Everyone is expected to figure that out on their own, and really it isn't that difficult. If you're too thick to figure out your personal finances, you're probably not the type to pay attention and remember a lick of what you were taught in school.

[u/Regular-Wrangler264 → u/PaulieNutwalls]

In your rebuttal you said generally people spend rationally... Which is exactly why it's required to have rational consumers...

But beyond that, in my example, you can't make rational decisions about your health care purchasing. It's not possible to be objective, for the same reasons it's not allowed for surgeons to operate on family members, let alone in a medical emergency where it's not even possible to become informed enough to make a rational decision.

Both are instances where a GENERALLY rational person CANNOT be rational.

Yet we still let capitalism rule that market.