What is "socialism"? - An attempt to clear up myths/misconceptions

[DonFerrari]

Leadified said:

DonFerrari said:

Sure, capitalism almost died because of the might Soviet Union ¬¬"

Capitalists were sure in a hurry to intervene anywhere where there was a hint of communism. Going as far as to ally with the fascists in Spain and Chile, sounds like they would do anything to stop the spread of red. If you do not fear the left then why do you keep trying to undermine it?

You mean governments that wanted to keep their power gone and intervened??? That doesn't really make capitalism to be at risk. I do not fear socialism, I do fear their tryouts that end up killing a lot of people in the process.

the-pi-guy said:

DonFerrari said:

You already gave the answer on why private companies run better than government.

They have the need to profit, so their process are make as efficient as possible, with cost reduction as a need and also driving prices down to get more customers also having to take care of debts.

While government just raise tax to cover holes, give themselves higher salary independent of their performance, are very tolerant with their debt, don't depend on the population liking or wanting the service to take the money and finally the most important point is that a big centralized government can't know the demands of every single small area on the country.

Not necessarily.  

It simply means that they want to maximize (income - expenses)

Sometimes that means that they raise what they sell their product for, instead of making it more efficient.  

Take a look at Apple. They make more than $400 per iPhone in profit.  This is in a market with extensive competition from many other massive companies such as Sony, Google, Samsung, LG, many many others.  

If a company can reasonably raise their prices to maximize their profit, they will.  

In a situation where a Government and a private company are able to reach the same level of expenses, from the consumer standpoint the Government will be more efficient, because unlike the private company, they don't have to produce any kind of profit.  They are much more able to sell at cost than companies are.  

It's easy to argue that private companies have to become more efficient because they are motivated by profit, but the picture is vastly more complicated than that.  If it were that simple, then a lot of big companies wouldn't be running the way they are.  

Sure a company will try to raise its price whenever possible to maximize profit (have I said otherwise???). I said that they usually have to drive the price down to increase adoption rate, just look at the average price of a car (corrected by inflation) on the early 20ths to today, or of TVs, or any other market with strong competition... people being suckers and buying premium products (one of the strategy of competition together with low cost and nich) doesn't make it less real.

Simplifying, there are curves, one of the elasticity of demand (related to price), marginal cost (how much less a product cost individually as you change the quantity) and the curve for elasticiity of offer. There are optimum brackets for the 3. So when the price is below a certain point they will sell enough to hit their maximum profit point on the marginal cost and will entice more competition to enter the market.

Government should, but usually don't produce profit, they rather put it as high salaries for the bureaucrats. Still they can't target all the strategies and needs at once.

 

Leadified said:

Locknuts said:

Have you heard of the Pareto Principle? Peterson explains it better than I could, but essentially in all areas of human productivity the square root of the total number of people produce approximately 50% of whatever it is they are producing. It's true in all areas of human productivity. This is why I doubt your claim that a smaller group of people are getting more of the wealth. The percentage will most likely remain the same.

Also, remember that the 'top 1%' or whatever figure you want to throw out there is an ever changing group of people. There is serious income mobility in the USA. It's only in dictatorships (which are mostly Communist or Socialist at the moment) where the people at the very top are disgustingly wealthy and the people at the bottom are starving.

1. You need to support your counter argument with evidence not mere principles. This site contains some handy graphs, don't think it has a wealth graph so I have provided one separately. 

2. According the 2014 Gini Index, Vietnam and Laos (both self proclaimed socialist states) are more equal than the US which has the same inequality level as China. In fact the worst performing countries are capitalist.

And since inequality is the biggest issue it certainly is better to live in Vietnam or Cuba than USA, and that is why we see daily migrants going from USA to both countries.

morenoingrato said:
Sorry VGP, but it sickens me that someone who is born and raised in such a privileged and comfortable position (Canadian citizen) so fervently advocates for a system that has ruined tens of millions.
That's all I'll say.

That is because generally only people that have a good standard of living and didn't lived on the places that they tried Socialism really defend it... like in Brazil where Socialists are mostly milionaries that think the government should do everything instead of using their own money.