The Instigator
ProfessorLiberty
Pro (for)
Losing
0 Points
The Contender
Quantumhead
Con (against)
Winning
4 Points

Capitalism is the best system to produce the best results

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Post Voting Period
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after 1 vote the winner is...
Quantumhead
Voting Style: Open Point System: 7 Point
Started: 7/5/2014 Category: Economics
Updated: 2 years ago Status: Post Voting Period
Viewed: 1,048 times Debate No: 58577
Debate Rounds (3)
Comments (11)
Votes (1)

 

ProfessorLiberty

Pro

This debate will have a free style. The only requirment is that any and all questions directed towards a contendor be answered. I shall begin with opening remarks and a brief history.

From the start of recorded human history, most people lived in what we would consider pretty terrible standards. However, something happened in the 1700s. We had an industrial revolution and living standards increased, and since then living conditions have increased dramaticlly. So, why was that? One common myth is exploitation, but exploitation has always been around, so it isn't that. Another one is investment, however, there has always been investment, but it did contribute in one way, and I will get back to that. What did happen was economic liberty. Adam Smith convinced the public that mercantilism and protectionism was bad, and the governments stopped the control of trade and market forces. That caused capital to be moved to its proper destination, causing innovation.

Take a look at the scandanavian countries. There tight controls has meant that innovation has effectivly stopped, in comparison to more free market economies. Now, that's not saying they don't innovate, they do, but not at the rate it could be at. It is the potential to make money that motivates people. Now, people may say, its passion, not money, that drives people to innovate but I would argue that money gives a "back-of-the-mind" thought people to motivate them to pursue their passion. Not only that, but a free market allows capital to be directed towards these projects, whereas say if a central government authority controlled banking, and thus loans, they don't have the interest to invest and lend to what could be profitable and useful products.

Capitalism, in its purest form, is the exchange of capital, goods, services, etc. It is peaceful exchange that is benificial to both parties. I exchange my labor, and in returnn I get money.

We are all individuals, not a monolithic machine that needs to be tamed inorder to serve what others deem our goals.
Quantumhead

Con

Living standards have been increasing since the birth of the human race. The argument that this is due to capitalism is a typically dishonest attempt by capitalists to create a false correlation between technological evolution (which can, by its very nature, only progress forward) and their unrelated financial pyramid system called capitalism. The amelioration of living standards predates capitalism and therefore the amelioration of living standards is not caused by capitalism.

Francis Fukuyama, a political scientist and staunch advocate of capitalism, proved in 1992 that dictatorships often have a more positive effect on the economy than capitalist societies. Since history is fairly clear that dictatorships are not usually a good idea, and since capitalism is an economic system, we can conclude that the most fundamental requirements of a healthy society are not found in its economy, otherwise everybody would be living in a dictatorship with high economic growth. This point becomes even more pertinent if we extend the argument further, and claim that all capitalist democracies are in reality capitalist dictatorships, proven by the fact that there is not, never has been, nor ever will be a democratic vote about the continuation of capitalism.

Social psychologist Erich Fromm wrote a book called The Sane Society over fifty years ago, in which he successfully proved that the psychological effects of indoctrination into capitalism were the same as that of a religion. If the values and practices of a particular ideology oppose the conditions of man"s natural state of being, then from an objective standpoint they institutionalise neuroticism. Adherence to them can therefore, as a matter of consequence, only conventionalise neuroticism within the individual. Since psychologists themselves would then be operating under an erroneous characterisation of normalcy (based on capitalist ideology rather than reality) their cornucopian encyclopaedia of known social dysfunction would predominantly then document the manifestation of normal (or at least reactionary) behaviour within an abnormal culture. To simplify the point with an analogy: at Sunday school, the problem child isn't the one who believes in the flying spaghetti monster and who makes his/her decisions based on that belief, because that's the dominant ideology of the group. The problem kid is the one who questions the logic of the group, and the more he/she does it, the more the others will find ways to revalidate their ideology to themselves (i.e. "He's just stupid"; "He's lost his faith"; He's a bad apple; He was sent here to test the rest of us" etc...).

You talk about innovation, but again this is another religious (and false) argument. Yes, better products can be produced over the short-term by introducing the concept of market competition, but over the long-term the same concept erodes the same competition it claims to promote, since capitalism has no reset button. McDonalds keeps getting richer, not poorer, and clearly it is ludicrous to suggest one can ever now enter into "competition" with McDonalds, since it has at its command the accumulative capital of half a century's worth of profit within a system in which capital is liquid power. The only logical result of capitalism is oligopoly and then finally monopoly, since the only effect of competition is to fraction down the competitors -- eventually to the point where there is only one left. The final result of capitalism therefore, is economic dictatorship.

You also mention exchanging labour for money, which is an interesting point to examine. Here in the UK, welfare claimants are now being forced to work for free for large companies or lose their benefit, and many of these were people who lost their jobs when the same large companies downsized during the recession. It's just another deception of capitalism that work is promoted and advertised as an incentive. Work is mandatory for the able in all capitalist societies, with the exception of the rich and powerful. Therefore, the basis of capitalism is economic slavery which has been called an "incentive" only to make the ideology more palatable to people. You are put to work in capitalist societies, and its as simple as that.

But who are you put to work for? Well, that one's easy, isn't it?

The capitalist banking system is another inevitable result of the logical fallacies which fuel the ideology. Since capital is the deity within this particular religion, the more capital one has, the more power one has over other people. But again, the people are told a different story; they are told that capitalism is a strict labour + manufacture = capital formula. But that is clearly false given that a bank's main source of income is capital investment (i.e. capital + risk = capital). Since banks bypass entirely the labour and manufacturing costs of business, and instead profit grotesquely from cheating the system, they devalue the cost of labour and the value of the currency. Despite this clear and irrefutable fact, capitalist society continues to be dominated by banks -- which are effectively parasitic organisms that charge society interest on every penny/cent in circulation -- for the simple reason that banks are already top of the capitalist food chain. Capitalist society can never pay the banks back for the physical currency, since with interest applied there will always be less money in circulation than the total due to the banks. Thus, the fundamental ideology of capitalism is that society works forever to pay back a debt it is mathematically impossible to repay, to a series of institutions which are forever devaluing its currency and undermining its labour.

Make no mistake: capitalism is a religion just like Christianity is a religion. It's a belief system with a mountain of evidence discrediting it, which people believe anyway simply because it is all they have ever known.
Debate Round No. 1
ProfessorLiberty

Pro

I thank you for that well thought out argument.

Let me start with what I found to be your main comparison and argument against, that capitalism is blindly followed like, as you put it, religion. From what I understand, you believe that socialism is feasible if our mindsets are switched from personal goal to societies goal. Now, I don't want to get hung up on this critique because I feel the real fault with socialism lies with distribution. We individually, each have different preferences, goals, desires, etc, and to say that in a socialist system, you would just have to work towards a collective goal. The fact of the matter is, the only collective goals society has that is constant is physical needs; water, food, etc. Promoting socialist democracy means that at the very most we will neglect %49 of the population.

Capitalism is not a form of government, so there can be capitalist dictatorships, and socialist democracies.

Now, I really want to address that McDonald's remark. McDonald's has held the highest market share of fast food, but its not a monopoly. Places like Burger King, KFC, Taco Bell, have always been competing with McDonald's. More recently restaurants like Subway, Jimmy Johns, and others have appeared on the scene. The fact that I can be 7 cheese burgers for one hours wage (I'd like to avoid minimum wage as much as possible, to time consuming.) shows that competition works.

Let's look at you innovation argument. Up until the 1800's, people made around $3, the modern equivalent of $3, even in the new United States and Britain. After 1800, income raised dramatically, and today the average American make $130 a day. What incentive do I have to spend hours of time on projects when I will only receive a fraction, a very tiny fraction, of the result of my labor.

Now, you have to understand the difference between Capitalism and crony capitalism, or as I call it crapitalism. What Britain is doing is exploitation.

You talk about the banking system. Most countries have a central bank, a government institution to control the interests rates, which I find appalling, In a free market, banks can't undergo risky investments, or engage in fraud, because they will go bankrupt. You say that the principal plus interest aggregated will always exceed the money supply. You are again referring to the crapitalism system we now have in place. If we where to increase the money supply along GNP, then you would be wrong. If we had a free banking system, where banks produce currency backed by commodities like gold and silver. In such a system, interest rates are set by supply and demand. The greater supply of money in reserve vs demand for loans, the lower interest rates. The lower the supply of money in banks vs demand, the higher the interest rate, discouraging borrowing.

Here is why socialism is impossible: prices are information surrogates. Prices deliver information to consumers and producers on needed information like supply and demand. Without, disruptions start to occur. I want to delve more into this, but I need to know your brand of socialism in order to better address my position.

Capitalism does have a reset button, its called a recession. Recessions are corrections in the market. However, if we pinpoint all recessions that have occurred without government interference, there are very few.

[To the person in the comments] Government spending in research does not always produce desired results. Take for example the U.S. We should already have affordable solar energy, but we don't because government can't engage in risky projects. By best results, I mean best results out of anything else. In socialist countries you aren't going to see nice cars.
Quantumhead

Con

Quantumhead forfeited this round.
Debate Round No. 2
ProfessorLiberty

Pro

Since my opponet has neglected this debate, I take that as forfiting.
Quantumhead

Con

Quantumhead forfeited this round.
Debate Round No. 3
11 comments have been posted on this debate. Showing 1 through 10 records.
Posted by Quantumhead 2 years ago
Quantumhead
Hey, apologies for forfeiting. I did wait for a day or so, but something came up and I wasn't able to log on for a while. Would be great to hash this out properly again from the beginning. It's an interesting debate, and one I have strong views on.
Posted by OracleOfReason 2 years ago
OracleOfReason
"Germany is still Capitalist, just "less" than the US in some aspects."

Well the US is still Socialist, just "less" than the Germany in some aspects. Again everything you have written shows a marked lack of understanding of these terms. Capitalism is NOT A STATE OF BEING!

Out of curiosity I have a question for the "Professor." I have lived in Germany and I am married to a Hong Kong native and have spent large amount of time there and will shortly retire there. I speak both languages. How familiar are you with these places?

You lost the debate before it started because YOU don't understand those basic political terms.

Singapore has a 30% social charge (Tax) and still generates more GDP from its public sector than its private sector. How do YOU define Socialism?

Do you really want to get into Hong Kong? Both are more Socialist than the US.

"In 2013, The Economist described its countries as "stout free-traders who resist the temptation to intervene even to protect iconic companies" while also looking for ways to temper capitalism"s harsher effects, and declared that the Nordic countries "are probably the best-governed in the world." - http://www.economist.com...

Many people call this model "Liberal Socialism"
Liberal socialism does not have the goal of abolishing capitalism with a socialist economy;[2] instead, it supports a mixed economy that includes both public and private property in capital goods.

This is the underlying philosophy of the SPD One of the two major ruling parties of Germany, and the Labor party in England. France currently has a Socialist party in power.
Posted by ProfessorLiberty 2 years ago
ProfessorLiberty
I'd like to point to Hong Kong and Singapore, low unemployment, high income.

I think is social saftey net, if it is properly built, does not hurt progress, so we should not consider that in detirmening how capitalist a country is. The US has a very poorly designed social saftey net, but some european countries have a properly built.

Germany is still Capitalist, just "less" than the US in some aspects.

Sweden still innovates, but at a much slower rate in some sectors. In the US, it costs a billion dollars and takes 10 years to get a new drug approved. In that aspect the US is less capitalist than Sweden.

China since the 80's has started moving towards capitalism and since then China's economy has improved. However, they are in one of the biggest housing bubbles in history.

Overall, we can't call Sweden, or Germany, or Finland socialist because they aren't.
Posted by OracleOfReason 2 years ago
OracleOfReason
To the Instigator:

You wrote:
[To the person in the comments] Government spending in research does not always produce desired results. Take for example the U.S. We should already have affordable solar energy, but we don't because government can't engage in risky projects. By best results, I mean best results out of anything else. In socialist countries you aren't going to see nice cars.]

You still don't get the meaning of the Terms Capitalism and Socialism. They are not states of being. The US is both capitalistic (health care to a large extent) and socialistic (SS and Medicare as examples). The difference between most 1st world countries are the degree to which both systems are implements. Even countries like China that declare that they are Socialist have many capitalist systems. And there are Mercedes sells more high end cars to China that they do to the US.

Germany is far more "socialist" than the US is. Think now how ridiculous this sounds, "in socialist countries you aren't going to see nice cars" Really? Almost every 1st world country has been creaming the US in social metrics lately. Our standard of living has slid precipitously in the last 30-40 years vis a vis our socioeconomic brothers. And all of them are more "socialist" than we are.
Posted by ProfessorLiberty 2 years ago
ProfessorLiberty
How does someone loose? If I trade my labor for money, how'd I loose? Since value is subjective, that person is trading their labor for an equal or higher amount then what they value it for that job.
Posted by kw7319 2 years ago
kw7319
A question I would like to ask for the opponent. You say in your argument that

"McDonalds keeps getting richer, not poorer, and clearly it is ludicrous to suggest one can ever now enter into "competition" with McDonalds, since it has at its command the accumulative capital of half a century's worth of profit within a system in which capital is liquid power. The only logical result of capitalism is oligopoly and then finally monopoly, since the only effect of competition is to fraction down the competitors -- eventually to the point where there is only one left. The final result of capitalism therefore, is economic dictatorship"

Aren't companies like Wendy's, Burger King, Long John silvers, Hardees, Chick fil a, etc. are in competition with McDonalds?

McDonalds in no means, has a monopoly on the fast food industry. There are many companies in competition with McDonalds
Posted by LogicalLib.org 2 years ago
LogicalLib.org
For capitalism to work someone has to loose. Its like playing the lottery, how confident are you that you'll hit the jackpot? Unlike in the hunger games, the odds aren't forever in your favor. Don't get me wrong I'm greatful for the life I'm able to live in comparison to places like Rwanda, North korea or cuba but capitalism is far from ideal or being the best case scenario.
Posted by OracleOfReason 2 years ago
OracleOfReason
Question for the Instigator regarding " There [sic] tight controls has meant that innovation has effectivly stopped, in comparison to more free market economies." This is unsubstantiated and wrong. The Nordic countries have a higher R&D spending than do most non-nordic countries and almost double that of the US as a percentage of the economy.

Today, the 12 countries in the Euro-zone (Euro-12) spend 1.9 per cent of their gross domestic product
(GDP) on research and development, while Denmark spend 2.6 per cent, Iceland 3.0 per cent, Finland 3.5 per cent and Sweden 3.7 per cent. Only Norway is below the Euro-12 average with 1.6 per cent of GDP. On the other hand, Norway"s GDP is extraordinarily high due to the country"s oil and gas revenue and, if the Norwegian
R&D expenses are calculated as euro per person, they are higher than the R&D expenses per person in Euro-12.

The great increase of Standard of Living in the last thousand years is that of the Chinese who have lifted 620 million people out of internationally recognized poverty in the last 30 years. This is the equivalent of Europe and the US combined.

This whole debate is framed in a way that shows the framer does not understand these systems. Capitalism is NOT A STATE of being. It is a tool of economic manipulation. All economies on earth are mixed economies. Capitalism may be the best way to drive a nail but this ignores all the screws that need to be driven in. The debate is lost before it began.

Capitalism is the best system to produce the best results in some areas. Yet it has failed completely in there areas, like health care. The debate is framed like this.

" A Porsche 911 is the best car to get things from one place to another to produce the best results."

Well if the things one needs to carry from one place to another are tree trunk, the Porsche is not a good vehicle at all.
Posted by Quantumhead 2 years ago
Quantumhead
Please will opponent note, second paragraph of opening argument should read: "Francis Fukuyama, a political scientist and staunch advocate of capitalism, proved in 1992 that dictatorships often have a more positive effect on the economy than DEMOCRATIC capitalist societies.".

Unfortunately I was working on something else while writing, and missed out the word, "democratic". Apologies.
Posted by ProfessorLiberty 2 years ago
ProfessorLiberty
Yes, I am. I could do the same debate with you in a few weeks, but I'm still going to be looking for a contender for this one.
1 votes has been placed for this debate.
Vote Placed by lannan13 2 years ago
lannan13
ProfessorLibertyQuantumheadTied
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Total points awarded:04 
Reasons for voting decision: Forfeiture.