Comment by tehjoker
1 day ago
Capitalism is good at driving down prices for consumer goods, also great at extracting rents from essentials (housing, medicine, education, etc). You gain on trinkets and lose on the things that make life worth living.
Of course, competition leading to near-zero profits means most competitors collapse, and the remnants get bought up by monopolists or oligopolists who then become rent extractors.
The technology was fundamentally developed with government grants to universities, or corporate labs like Bell Labs that were funded by a legal mandate on its parent corporation. Capitalists can only develop products that are basically ready for market, their margins are thin and planning horizons can only survive about 5 years usually. Their main power is throwing oodles of money at something ready to go and scaling it.
Edit: I will be slightly more charitable and note that capitalist companies can also do incremental research if there is a gentle and obvious hill to climb. Sometimes people do make crazy bets and they pay off, but that's more the exception, in America the dominant driver of technological innovation is government funded research supplied by capitalist scaled technologies (i.e. you research the next paradigm in the lab and purchase e.g. pre-existing computing resources from a company).
> Capitalism is good at driving down prices for consumer goods, also great at extracting rents from essentials (housing, medicine, education, etc). You gain on trinkets and lose on the things that make life worth living.
I find it funny when capitalism is blamed for rent extraction.
First off, extracting profit is not unique to capitalism. It happen in the Soviet Union as well, just on the black market. Even in the legal market workers would "sell" things they had control over for personal benefit. It's not like this disappears with other economic systems - it's a core human behavior to do things that benefit yourself.
Second, almost all of the things you listed - housing, medicine, education - are rent extractions not because of capitalism, but because of government regulations that allowed rent extraction. If people could build as many houses as they want, treat patients without jumping through the AMA quota hoops or charge a tuition that students can actually afford (and not backstopped by the government), none of this rent extraction would happen. We have plenty of examples of those economic sectors where prices are much more reasonable.
> it's a core human behavior to do things that benefit yourself.
That's an assertion often made without evidence. Humans are one of the most cooperative species in existence.
You realize of course that many other countries manage to provide these services for a fraction of the price of America no?
A colleague of mine that went to an Ivy League school in America told me her friends in Poland, not a wealthy country by any means, laughed at her for "buying her degree".