[p2p-research] The problems of debt
Michael Gurstein
gurstein at gmail.com
Mon Jul 12 15:14:43 CEST 2010
(I was referring to the earlier back and forth...
Because it is dealing primarily at the level of slogans and bumper sticker
philosophy -- you are a socialist/marxist/capitalist -- blah blah as per
Beck et al.
It is a characteristic of the extremely degraded public discourse in the US
at the moment that this kind of sloganeering substitutes for significant
policy analysis and responsible governance and of course it is a way for the
know-nothing US right to close down discussion and close out options and
even to bully people into silence and submission.
(Yes Marx was referring to the entire capitalist system, recognizing its
advantages -- as the means to overcome the limitations of feudalism, but
also recognizing its necessary element of insatiable greed as the basis for
internal self-destruction including through the on-going enmiseration of
that part of the population without access to resources apart from their own
labour... How various political systems have responded to the reality of
this observation has pretty much driven the political economies of the last
century and a half which I think is a rather more useful place to begin
discussion than whether or not my grandmother wore rubber boots...
M
-----Original Message-----
From: p2presearch-bounces at listcultures.org
[mailto:p2presearch-bounces at listcultures.org] On Behalf Of Daniel Araya
Sent: Monday, July 12, 2010 2:28 PM
To: p2presearch at listcultures.org
Subject: Re: [p2p-research] The problems of debt
How so?
D
_____
From: gurstein at gmail.com
To: p2presearch at listcultures.org
Date: Mon, 12 Jul 2010 14:21:08 +0200
Subject: Re: [p2p-research] The problems of debt
This kind of Beck-ian discussion is as much a red herring as the original.
M
-----Original Message-----
From: p2presearch-bounces at listcultures.org
[mailto:p2presearch-bounces at listcultures.org] On Behalf Of Daniel Araya
Sent: Monday, July 12, 2010 2:09 PM
To: p2presearch at listcultures.org
Subject: Re: [p2p-research] The problems of debt
Michel, you're presenting a false argument IMO. Ryan is making the point
that the entire system of capitalism (all strata included) is highly
productive-- the most productive system so far in fact. Marx himself made
the very same point...
D
_____
Date: Mon, 12 Jul 2010 13:12:48 +0700
From: michelsub2004 at gmail.com
To: p2presearch at listcultures.org
Subject: Re: [p2p-research] The problems of debt
this is of course very questionable ...
put capitalists in a room, and they are tremendously unproductive, they are
only productive because workers are productive, but you could argue, that
the organisation of production is a form of productivity ... yet most of
that done is not done by capitalists but by a paid managerial class ...
also, as we now know, the most well-paid were actually destroying the most
value (there is a study of the NEF on that ... .. the added value of
capitalists and financiers is actually negative)
so your statement that in capitalism, the more value you create, the more
you consume, is a nice piece of mythology, but unwarranted and disproven ..
you also discount social movements ... the Nordic countries have very strong
labour and social movements, could this be an explanation, rather than
mysterious goodness, that explains their social system,
and is it a coincidence that the best-paid workers in the world, i.e. the
Koreans, also have the strongest unions?
following your reasoning, the top 1% of the population mysteriously created
lots and lots more value ... yet, growth rates declined dramatically since
the 1980's
Michel
On Sun, Jul 11, 2010 at 10:58 PM, Ryan Lanham <rlanham1963 at gmail.com> wrote:
In the past and present, people of enormous productivity (e.g. capitalists)
consumed significantly in a way that others see as wasteful. Indeed it is.
But they view this as a reward for their huge productivity. Measuring
productivity and value creation is hard. No one knows exactly how to do it.
But we do know that people will argue that their capacity for value creation
is greater than it might actually be. In other words, people negotiate for
their own benefit rather than society's. If society does a bad job at
evaluating value of productivity, systems become very inefficient, and the
machines of society too often produce stuff people don't want as much as
they could have if the machines had been used efficiently.
In capitalism, the more value you create. The more you get to consume. In
any other system, immediate imbalances are inevitable. The only possible
non capitalist system that can work, in my view, is one where moral
responsibility to the society is a sort of currency...as in Nordic
countries. In those places, value producers subordinate their own desires
to those of others. Why? Who can say.
On Sun, Jul 11, 2010 at 10:50 AM, Ryan Lanham <rlanham1963 at gmail.com> wrote:
Money is, in simplest terms, a machine.
It isn't like a machine. It IS a machine. It is a machine that either
makes something others want (value) or it is a machine that makes things
only a consumer wants (i.e. consumption).
If it makes consumption, it is used up. If money makes value, like all
machines that can be used more than once, it is a value multiplier.
If someone uses money to create value, then they are productive.
Productivity leads to happier worlds because people have things others want.
In an eastern-styled anti-desire world, these systems do not apply...though
there is ample evidence, given free choice, nearly everyone wants something
that is scarce. Wanting fewer things that are scarce is a sort of advantage
in this new world, but it is a choice most would not want to make freely.
People like cars, tools, luxuries of all sorts...jewelry, prettier mates,
etc. These things cost machinery...money to produce. If they don't create
further value...then that is consumption. Non productive consumption burns
up capital. It is a fire in the machine shop. Granted, it is a necessary
fire, but it is a fire none-the-less.
Build a good machine...and value is created. Build a worthless life or
machine, and value is consumed.
On Sun, Jul 11, 2010 at 10:33 AM, Ryan Lanham <rlanham1963 at gmail.com> wrote:
I've been asked to explain debt problems as influenced by technology. I'll
try.
Here's my "theory". Many others share or have versions of something
similar. I claim no originality. I've posted several versions on this
list.
1. Growth occurs when someone produces something others value. The sum
total of value is the economy.
2. In the past, it was a matter of work and labour to produce something of
value...like digging a hole where a hole was wanted.
3. People learned to take money that was not in use and to use it by
borrowing it and then buying value-production which was then placed on sale.
4. The process of 3 entails risk. Risk was rewarded by profit.
5. The system of 3-4 really works quite well so long as profit is likely.
6. In a world where learning and high productive machinery requiring low
skill levels is readily available (i.e. post 1990 or so) making profit is
harder. 7. Item 6 is especially true if innovation is not protected by the
state (e.g. through intellectual property.)
8. Because profit is harder especially in tangible goods and services
(because of technology and learning distribution) credit is harder.
9. When credit became hard, the incentives to cheat increased. People lent
money badly and then cleverly sold the bad loans to others who didn't
understand.
10. When 9 happened, the state had to decide whether huge firms fulfilling
important institutional roles would die, or be saved.
11. Nearly all states, especially in Japan and Europe, chose to save old
institutions (e.g. Royal Bank of Scotland), or in the US, AIG.
12. There is now an open question as to whether markets can still create
value (e.g. the iPod) in such a way that debt is justified. If not,
capitialism in the form that creates ready growth through using unused money
is screwed.
13. When money goes unused, it is difficult to create new money and growth
of value. There is no/little incentive to innovate. This can be called
"deflation."
14. Deflation is more dangerous to capitalism by far than inflation.
Deflation means shrinkage of an economy because unused money becomes more
valuable by sitting than by being used. Thus, people become even more risk
averse.
15. When 14 happens for a long time (e.g. Japan) then demographic and
institutional patterns start to become unsustainable.
16. When 15 happens, we do not understand the long term outcomes, but they
don't seem good.
--
Ryan Lanham
rlanham1963 at gmail.com
Facebook: Ryan_Lanham
P.O. Box 633
Grand Cayman, KY1-1303
Cayman Islands
(345) 916-1712
--
Ryan Lanham
rlanham1963 at gmail.com
Facebook: Ryan_Lanham
P.O. Box 633
Grand Cayman, KY1-1303
Cayman Islands
(345) 916-1712
--
Ryan Lanham
rlanham1963 at gmail.com
Facebook: Ryan_Lanham
P.O. Box 633
Grand Cayman, KY1-1303
Cayman Islands
(345) 916-1712
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