Comment by energy123
2 days ago
Human nature (greed) is never the problem, because it cannot be changed. Focus only on what can be changed. Design a system that manages human nature, pointing it in a direction that is beneficial, while taming its side effects.
A denial of human nature is how you get authoritarian socialism with centralized planning, which leads to catastrophe because of the local knowledge problem, and because people have no private incentive to do anything.
"Capitalism" is an incomplete first step towards a system which channels greed into something that's beneficial for all stakeholders. A profit-driven actor making their production more efficient to increase profits is a good thing for everyone.
But capitalism is incomplete because the profit-motive can become pathological. Market failures are commonplace.
The only solution that is proven to work is a mixed economy done right, with clever and lean regulations, and a government not influenced by money, and with the government stepping in occasionally to provide public goods that the market cannot, and with private actors otherwise free to make profits as long as they are not harming any third parties.
> Human nature (greed) is never the problem, because it cannot be changed. Focus only on what can be changed.
The statement might appear to be pedantically true, but it's not true in practice. Sure, greed cannot be eliminated, but you certainly have systems which control the actions which result from greed. In reality, the actions brought on by greed are the real problem and we have an entire branch of the US govt(the legislature) dedicated to setting up mechanisms(laws) to discourage unwanted actions via threat of consequences.
So, it's certainly possible to mitigate the effects of greed. What people are pointing out is that of late corporations(and more specifically the C suite) have faced few if any consequences for detrimental behaviour driven by greed.
Hence the problem.
We are saying the same thing.
> centralized planning, which leads to catastrophe because of the local knowledge problem, and because people have no private incentive to do anything.
The local knowledge problem might have been an issue with central planning a few decades ago, but I don't think it is anymore. Everyone now has in their pocket a device with which they're able to instantly send any kind of information anywhere. We now have computers and software powerful enough to process all this information. The price mechanism is an ancient, inefficient and slow way to transmit information compared to what we could achieve today if we really wanted to.
People have all kinds of incentives other than profit. People wouldn't just lie down and die if they couldn't make money by owning things. The failures of past attemps at planning had more to do with the limited technology they had and the poor decision-making structure that centralized power and allowed too much corruption. That doesn't mean planning will always have that kind of a result.
> a government not influenced by money
This is impossible in capitalism, which will always over time create concentrations of capital large enough that influencing the people in government will become affordable, no matter how hard you make it. Government is just people, and there'll always be ways to influence people using money. In a well designed government it would be hard and expensive, but you can never make it impossible. Eventually a corporation or an individual will become so wealthy that they can afford it, and at some point conditions will arise where influencing the government will be a cheaper way to increase profits than fairly competing in the market.
> The local knowledge problem might have been an issue with central planning a few decades ago, but I don't think it is anymore.
I think you are right in principle. The signals can be centrally computed, if all the relevant edge data was somehow made available to the central compute. I see two practical problems. What is the actual probability that a government won't royally screw it up? I would give a pessimistic assessment given the lack of theory and lack of empirical case studies. If a government wanted to run a small opt-in test case, I would not be opposed to it, but I would expect it to fail. In any case, why would you want to risk it? Why not just do market socialism?
The other practical problem is the incentive question. I read what you wrote, but I can't help but feel it's a bit hand-wavey. Maybe you have a personal constitution that means you don't need to work for profit. But I believe most people, including myself, would only do the minimum if no personal gain was involved, unless it was a truly unusual circumstance like someone invaded my country which stoked nationalist fervor. But in a normal economy in a normal country, I do not believe you will be able to sustain high output or high innovation.
> This is impossible in capitalism
It's an ideal that's impossible, but you can asymptote rather close, there are a number of social democracies (which are mixed economy, i.e. capitalist) in Europe that attest to that.
> Why not just do market socialism?
Because markets are based on competition, and that causes a lot of issues on it's own, even in the absence of capitalism. It's because of competition that we consume too much resources, have wars between nations, etc. I don't think we can get rid of a lot of the problems we have unless we start actually planning long term and co-operating instead of competing. I agree with you that it'd be hard and risky to build a working planned economy, and that it'd be best to start with small scale tests. I just don't see how humanity will survive unless we start planning at a very large scale and stop competing with each other. A global planned economy is the only way to do that.
> But I believe most people, including myself, would only do the minimum if no personal gain was involved
I don't think all personal gain needs to be removed in a planned economy. There could be different rewards for different tasks, if achieving the plan requires it. What is not necessary is the ridiculously large differences between rewards. It's enough that the reward is somewhat motivating, there's no need to have some tasks be thousands or millions of times more rewarding than others. If there are tasks that wouldn't get done in the absence of rewards so large, surely they are rare and worth leaving undone for the other benefits of a planned economy.
> there are a number of social democracies (which are mixed economy, i.e. capitalist) in Europe that attest to that.
I live in one of the best managed ones, and still we're slowly but surely losing our government to the influence of capital. Media is concentrating, worker rights and unions are being attacked, etc. It takes a long time in a well designed system, but eventually capital will win. Even if we manage to get a government that tries to protect the rights of people over capital, the realities of a global economy based on competition don't allow that anymore. If we try, we lose to countries that don't and then we can no longer afford it.
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Who decides the clever and lean regulations? How do we maintain the best ones when power changes hands in government?
Human nature is not greed though. Human nature is very very varied and adaptive. And the historical norm of human nature is one of sharing, community and support, as much as such a claim can even be made. And human nature is subject to the whole bigger system in which it lives.
Capitalism is in many ways such a system, one that is built around driving the worst parts of human nature. And the thing is the profit motive becoming pathological is not a bug. This is the key defining feature of the system. Capitalism really isnt even about markets. Its about consumption, and producing things specifically to sell them in order to make some markup. The goal is specifically to find ways to make money, and stuff like fulfilling peoples needs, quality, workers rights, and regulations are clearly things that are getting in the way.
Exactly. I can't express the degree to which people thinking we can fix it with just one more surgical precision law drive me up the wall. They've clearly never tried to do anything regulated.
The second, third and Nth order consequences of the sum of the shortsighted quick fixes these people have peddled result in a world where only sociopathic corporate entities can do anything, and of course those entities are incredibly "greedy", they wouldn't be able to remain profitable if they weren't.
Those vacant main street store fronts (metaphorical or literal, your pick) are only half vacant because the PE fueled megacorp that owns them doesn't deem it worthwhile to rent them. The other half are vacant because the cost of jumping through the regulatory hoops to rent them in a lawful manner is unjustifiable for the small time owner.
> I can't express the degree to which people thinking we can fix it with just one more surgical precision law drive me up the wall.
I think there is misattribution here. Us neoliberals do not believe that things can be easily improved through incrementalism. We believe that the alternative methods proposed by other political/economic systems lack credibility, and so we are stuck with the least bad option that reality has forced upon us. We also believe that things can get much, much worse, which is not a belief that's emotionally salient to other camps, who we see as assuming that things can only get better, when what usually happens is some tinpot authoritarian takes over and everything gets worse despite the naive ideals of the political entrepreneurs who tried to cause change. We also perceive a deep ignorance of basic economic facts to be commonplace in other camps; people who push for proven bad ideas like rent control, and this is discrediting.
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> Human nature (greed) is never the problem, because it cannot be changed.
Citation needed.