Free market and exploitation question.

[hard@work]

i'm just wondering how exactly a free market system will not be exploited by the already rich to further their own endeavors of wealth and control, and will support small business in a way that teh current system prevents...

I could use some new talking points. I've debated this guy endlessly and I've finally got him listening. I need some really solid stuff if you can help.

[Colin]

Here's my best shot. It's not put together well, but the ideas are there.

A free market is a more level playing field than a government-regulated market.

Most people agree that big corporations and rich people in general have inordinate influence on the government. If we try to use the government to regulate the market, then corporations will have an inordinate influence on those regulations. It follows that government regulations will tend to be good for big corporations and tend to be bad for their smaller competitors. Corporations use regulations to make it difficult for small competitors to enter the industry. Imagine a pharmaceutical start-up trying to navigate the FDA bureaucracy. Occasionally, a small company will make it through, but most are deterred. If they have an idea with clear potential, they'll usually sell out to a big company.

Corporations also use more direct methods of fleecing the people, e.g. tax loopholes, subsidies, and tariffs.

People often think of the government as a check on corporate power, but it's really an augmentation of corporate power.

[d_goddard]

It's very simple.

In a free market, the only way to get people to give you money, is to provide a product or service which for which they will voluntarily pay.

If you want to make a lot of money, you have to provide a great deal of value to a lot of people.


This is in stark contrast to Government, which takes money by force (taxation) to provide services against which the free market is not allowed to compete (USPS, DMV, police, courts) and to protect gangs that have paid "protection money" against competition (large corporations)

[RPinSEAZ]

I have a person I've been working on converting for a while now too and this is a major sticking point for him. His argument, in a nutshell, is that companies exist to make money and that they will take exploit desperate people (poor unskilled labor) unless there is regulation preventing it. Anyone have a good comeback to this?

[Laja]

My friend's biggest issue with RP is regulation. She's afraid he's going to nix the regs in effect with regard to pollution. He talks about the right to sue someone who's hurting your person or personal property. But what if you have a river running through your property and someone upstream is polluting it. First of all, the burden of finding the polluter is on you and if it's a big corporation, how are you going to sue them as a "little person"? And if they're in another state, that makes it more challenging. Does anyone know how to respond to this concern?

[MN Patriot]

"But what if you have a river running through your property and someone upstream is polluting it. First of all, the burden of finding the polluter is on you and if it's a big corporation, how are you going to sue them as a "little person"? And if they're in another state, that makes it more challenging. Does anyone know how to respond to this concern?"

This is an example of the drawbacks of public property, in this case a river. Since the government owns the river, it is responsible for protecting it from damage. Government has done a horrible job of protecting its' resources until about 40 years ago. I think there is an honest component to environmentalism, but it has been taken over by socialists who are more concerned about controlling people than protecting the environment.

Suppose the river were private property, owned by a corporation that had to protect its' asset. It would get to be pretty complicated, with property owners along it and all, but the River Corp would (hopefully) make sure the river stays clean. I know this is a hard sell to committed socialists, since their impression of corporations are pretty poor. I'm not that fond of corporations myself, especially when they get in bed with government, but that is another issue.

[bbachtung]

My friend's biggest issue with RP is regulation. She's afraid he's going to nix the regs in effect with regard to pollution. He talks about the right to sue someone who's hurting your person or personal property. But what if you have a river running through your property and someone upstream is polluting it. First of all, the burden of finding the polluter is on you and if it's a big corporation, how are you going to sue them as a "little person"? And if they're in another state, that makes it more challenging. Does anyone know how to respond to this concern?

Nothing in Ron Paul's position would prevent the states themselves from regulating as they see fit. Further, one of the few instances of original jurisdiction that the Supreme Court enjoys is in cases when one state sues another state, so the "little guy" would likely have some big guns backing him up. Finally, I am certain that there would be plenty of groups (like Riverkeepers or whatever that group that RFK Jr. runs) that would be willing to do pro bono lawsuits against big companies that polluted some small farmer's property, not to mention the trial attorneys who would be chomping at the bit to get 1/3 of whatever they recovered against the deep pockets polluter.

What we have now is a government that changes hands from a Dem to a Rep every few years, with corresponding alternating levels of enforcement, which usually amounts to nothing more than a relatively small fine levied against the big corporation and the taxpayers (or the property owners) left holding the bag to clean up the messes.

[fsk]

I address this on my blog:

http://fskrealityguide.blogspot.com/...usinesses.html

In the present, a lot of people make money by extracting favors from the government, instead of actually performing productive work. For example, would all those private military contractors exist in a free market? They received a massive amount of no-bid contracts.

Basically, the Federal Reserve is a huge subsidy to large corporations, paid by the average person as inflation.

Government regulations make it hard for the average person to start a business.

Income taxes and a corrupt monetary system make it very hard for the average person to accumulate capital and start their own business.

Wealthy people receive more in government perks than they pay in income taxes.

The problem is that the current market isn't a free market. It's actually a communist dictatorship! In the current economic system, wealthy people exploit the government to funnel wealth and power to themselves.

The government doesn't PREVENT economic inequality. The government is the CAUSE of economic inequality.

[Brutus]

fsk,

You got that right. They tax your income to keep you from accumulating wealth, then they tax your savings (inflation) to keep it from amounting too much.

[angrydragon]

http://www.independent.org/publicati...cle.asp?id=164

The real “robber barons” of the late nineteenth and the late twentieth centuries are the business people who, having failed to achieve competitive success in the marketplace turned to government and asked it to enact laws and regulations granting them special privileges and harming their competitors.

For over 100 years antitrust regulation has allowed politicians to deceitfully pose as “populists” while stifling competition with politically motivated attacks on the most innovative and progressive companies. These attacks have been supported for over a century by socialist intellectuals and journalists who have taught many Americans to hate capitalism, to envy successful people, and to support government policies that undermine or destroy them both Being the most successful businessman in the world, Bill Gates was an inevitable target of the anti-capitalistic crusaders. It’s time we recognized antitrust for the protectionist racket that it is and repealed the antitrust laws.

More stuff at http://www.independent.org/publicati...list.asp?pid=3

[hard@work]

Thank you for your responses. I am still working on him. This is my first salvo:

i agree fully here...this is my biggest complaint about libertarians and the like - they believe big business should have no regulations or limited regulations - believing that the market will create natural balance, but it iwll not. one only has to look to the media and it's power now to understand what will happen if you deregulate business.

That is not what libertarians believe.

Respect for Property Rights Necessary for Freedom

It is the most basic of all our rights. In a society which has the proper focus, many of the problems we face today become non-issues. Over the last half-century, there has been a declared war on these most fundamental of rights: property rights.

Some try to make this an issue of simply pro-property rights versus pro-environmentalism. In reality, the issue is much, much deeper. In fact, how we look at property rights is a most basic foundation of our liberty.

When one has a proper respect for property rights, environmental concerns go away. In a society that respects the property of others, it is cause for legal action if someone pollutes your land, or the water coming across your property, or the air which floats above it. With a proper respect for private property, people can and should be allowed to do whatever they would like with their land - barring any restrictions they agreed to when they purchased the land - up until the point that their actions physically affect their neighbors.

So while a land owner may choose to build a big factory on his land, he must be very careful to ensure that no harm comes to adjacent property owners, or he will face the unmitigated wrath of those neighbors. In the past, big businesses often colluded with government to allow them to pollute their neighbors land, leaving the adjacent owners with devalued property and no recourse.

But the issue is so much more broad than simply concerns over the protection of the environment. Much has been done in the name of "environmentalism" which in reality has little to do with clean air and water, and everything to do with power and control.

For the degree of freedom we enjoy on our own property - whether it is a thousand-acre farm or a single-family dwelling lot in a town or city - is a strong measure of the liberty in a society.

-Ron Paul

There is a lot more to it than just allowing individuals to gather power and abuse it. It's about preventing the corrosion of individual liberty. If "libertarians" were so "pro big business" then they would be in power. It is the government now that is pro-big biz. Libertarians are pro Individual freedom and anything that stands in the way of freedom through force - be that detriment to health or liberty, should be removed.

The issues that are effecting the "mainstreet" American people are complex. And the information you are given by the media outlets (online or offline) is riddled with agenda or misinformation. Root issues are often not understood or explained, unintentional or not. The "real owners" as George Carlin likes to call them:

http://www.youtube.com/watch?v=h5b0Rs2uvCY

They really don't want you to think about these things. By separating your economic liberty from your personal liberty they have been able to whittle away both. Corporatism, the welfare and warfare state melded with the big corporations, is the enemy of the free market. But you see the "free market" as the ability for corporations to run rampant. As opposed to what truly is going on, the corporations control the information and regulations themselves. We witness conflict but the majority of this conflict is the business interests fighting each other - not the American interests. This is a complete farce. The "free market" is freedom for you and I, not for evil business interests to harm others. It means that you and I can exchange goods freely with who we choose. Instead, under the label of "free markets" they have regulated the &#*% out of us. If we had a free market, we would not be purchasing goods and services from a handful of companies and institutions.

Liberty does not allow for any of this. And as long as you truly believe that the views you are given are correct you will never set your sight on what liberty truly means.

Irony is Andrew Jackson on a Federal Reserve Bank Note. Nine trillion dollars in debt and your labor which is your property is tied into the monetary unit that the government regulators have complete control over. I can't force you to understand this I can only hope that you realize no matter what your political views are we cannot achieve anything as long as the one party system is dominating our country.

These people are lying to you *username*. Look, I have deep respect for the bleeding heart. I share it. I believe in socialized EVERYTHING but I do not agree with government having *#%& to do with it. If you think about environmentalist movements from the libertarian perspective which is more powerful? Government regulation which allows theft of property, and by property I refer to your health and wealth not to land you own, or true principles of liberty which state quite clearly that there shall be no damage to property whatsoever? The idea that the pollution of land, water, or air is 100% unacceptable is the damn truth and I doubt any eco-friendly individual would disagree.

Yet why is this position fought by the democrats and republicans?

Because it's bad for them and good for us. Because libertarian views are actually Classical Liberals (look it up will ya?). The true liberal movement in America. Because ultimately we want to restore the power to the people and remove it from the corporatists and big government power brokers.


************************************************** ********

here is the response I'm working on:

a.) that reads like rhetoric
b.) i'm not a person who straight out believes all the federal reserve stuff.
c.) that in no way answered my question of what checks will be in place to secure the needs of freedoms vs the power of business.

[user]

This is yet another example of someone who needs to be taught the difference between capitalism and corporatism.

[hard@work]

This is yet another example of someone who needs to be taught the difference between capitalism and corporatism.

I'm working on it. I think a lot of so called "liberals" understand that we have corporatism. I do not think they understand why we have it or how we got here. I think the core issue is that there is this instinct that if we just had the right people in office then this would not happen. That we need to use force to solve the problem as opposed to stopping the force that has created it.

[user]

I think a lot of so called "liberals" understand that we have corporatism.

I guess so, but I think they equate it with capitalism, which is a huge mistake. Big business (today), lobbyists, militarism, the Fed, fiat money...all of these things are related to corporatism, hurt the poor, and are against capitalism.

I know I'm preaching to the choir here, but I really think a lot of people are Democrats just because it's easier to see how full of it the Republicans are. Republicans, by preaching capitalism and practicing corporatism, have probably created a lot of Democrats. They see the results of corporatism and think, well, that can't be right.

Of course, when you understand that capitalism is opposed to corporatism, you soon realize that capitalism actually has less in common with corporatism than even socialism.

A lot of antiwar Democrats got there by seeing through the lies. We should help them see through more of the lies.

[angrydragon]

Here's a good explanation of corporatism.

Governments gain authority though force. Corporations have no
authority. Without government collusion, corporations are powerless
against the rights of the individual.

http://www.ronpaulforums.com/showthread.php?t=42146

[hard@work]

i'm not talking about the enviornment here, i'm talking about protecting the individual from the excess power of uncontrolled industry. yes, the enviornement is mad important, but more important is the power associated with wealth in our country. you let corporation govern themselves, leaving government out of it, and you will see a return to the days before the anti-trust movement. look at the trends of power in big business prior to the anti-trust movements of teddy roosevelt, specificalaly the power of the media and the railroad. these are just roadmaps for what would happen here - look how much power the oil companies have now, do you think deregulation of business will resolve that issue? i don't. in fact, i think corporations like oil, power, media and pharmies will completely decimate america.

secondly, i don't respond well to rhetoric, it doesn't move a conversation forward at all. in fact, it undermines the primary purpose of a conversation like this. i'm not undermining your thoughts, just looking for something that actually looks like an individual thought...

just my opinions, but i have yet to see anything that doesn't suggest the deregulation of large business is a positive for the middle class in any way...just look at corporations like wamart whose primary concerns create a vacuum of poverty in america. walmart is probbaly the primary example of what business will become - walmart is a HUGE corporation with serious economic interests and a supply line that undercuts just about everyone out there - so walmart moves into a town, they undercut the smaller businesses that thrive there, forcing the once proud middle class business owners to resort to working for the very company that destroyed their american dream, because very simply - it's the only job left. it pays much less, forcing you to shop at their "discounted" prices, funnelling the money back into walmart and out of the community - this is why i fear even suggestions of deregulation of business...

He's fighting statistics with assumption at this point. I could use some statistical help and some ideological positions as well.

[user]

He's fighting statistics with assumption at this point. I could use some statistical help and some ideological positions as well.

Walmart has received millions of dollars in direct government subsidies, plus huge indirect subsidies like changes in regulation and trade policy. Monetary inflation is a huge subsidy to large corporations as well.

Every industry he mentioned ("oil, power, media and pharmies") are heavily subsidized. In fact, add banks and defense contractors and you have a great list of the most subsidized industries in the country.

As for the pre-anti-trust days, there is a lot of misinformation about what conditions were actually like back then, and the extent of government involvement. It would take more of an explanation.

[hard@work]

Walmart has received millions of dollars in direct government subsidies, plus huge indirect subsidies like changes in regulation and trade policy. Monetary inflation is a huge subsidy to large corporations as well.

Every industry he mentioned ("oil, power, media and pharmies") are heavily subsidized. In fact, add banks and defense contractors and you have a great list of the most subsidized industries in the country.

As for the pre-anti-trust days, there is a lot of misinformation about what conditions were actually like back then, and the extent of government involvement. It would take more of an explanation.

Can we source this? I could use some sourcing.

[user]

Can we source this? I could use some sourcing.

The Walmart bit comes from Wal-Mart: The High Cost of Low Price, which he may have already seen. One part of that documentary shows a city giving Walmart a huge sum of money to build a store there, and then a small business goes out of business.

Ron Paul himself is one of the best sources on monetary inflation. Basically, the biggest corporations get access to the best interest rates, at cost to the taxpayer. They get the new money first. This is a constant transfer of wealth from the poor and the middle class to the rich (the inflation tax). Every true liberal should want to stop this regressive tax immediately.

Cato isn't always right but here is a good source on subsidies: http://www.cato.org/pub_display.php?pub_id=8230

[Gugnico]

As for the pre-anti-trust days, there is a lot of misinformation about what conditions were actually like back then, and the extent of government involvement. It would take more of an explanation.

Oh, please let me know where I can find information on this. All I remember from my days in history class is "people were poor and that's why capitalism is bad." Although I understand and agree with all the arguments against government regulation, I find it hard to get past this point with my peers who received a similar education.

Thanks!

[user]

Oh, please let me know where I can find information on this. All I remember from my days in history class is "people were poor and that's why capitalism is bad." Although I understand and agree with all the arguments against government regulation, I find it hard to get past this point with my peers who received a similar education.

Thanks!

Yeah, I guess everyone gets that propoganda in school. First the idea that the Industrial Revolution caused more poverty is not correct. Since conditions improved for many people, it became much more obvious when some people were poor. So it looked like poverty was increasing, when in reality it was decreasing.

Generally every case of a monopoly is the result of some kind of government interference. When this wasn't the case, and a company became very large, it was because of the benefits for consumers.

[MN Patriot]

I could use some new talking points. I've debated this guy endlessly and I've finally got him listening. I need some really solid stuff if you can help.

Here is an approach from the other direction, with a twist: socialism is exploitation, by taking from the haves and giving it to the have-nots. Your average socialist thinks the very rich should be taxed enormously, and they have been as high as 92% in past years. But what about the average working person? They get taxed at a lower rate, but it impacts them more than a higher rate for someone who is rich.

$10,000 means a lot to someone making $60,000 a year. 10 grand is just a nice vacation for someone making $600,000.

This is how the rich use political judo to exploit the middle class: keep them overtaxed, in perpetual debt and living from hand to mouth, with the income tax that the middle class socialists THINK is being used to punish the rich!!!

Then to add insult to injury, guess where the tax money goes in many cases? Back to the rich! In the form of corporate subsidies, corporate contracts for government projects like buildings, war materiel, etc.

While some middle class socialist idiot brags about how "Uncle Sam paid for something of mine" with a tax write-off (I've had plenty of people tell me how the government is paying them, when it is merely taking less of their money), the rich are getting HUGE write-offs AND their portfolio of stocks increase in value from government contracts.

[vertesc]

1) in a free market, all contracts are voluntary. You choose to accept the contract at $2.50 an hour, so it's hard to complain that you're being exploited.
2) in a free market, labor unions exist not to lobby government for laws in their favor, but to negotiate with employers.

Right now, if you need cheap labor, you hire illegal immigrants for dirt cheap. They don't have the right to organize a labor union, they can't sue the employer for unhealthy conditions on the job, and they can't vote to try and get reforms passed. The present system really does exploit people. A free market, by definition, cannot.

[vertesc]

Capitalism is NOT a way to end poverty. It is a way to institute true justice.

Consider: in nature, a human being has to produce food and shelter in order to survive. Anything that he produces himself, by natural right belongs to him. If he works his butt off and harvests a massive field of corn, it is Right and Just that all that corn should be his. He has earned the ability to get fat that season. Conversely if he produced nothing, it is Right and Just that he have nothing. To assert otherwise is to support a contradiction.

In a free market, if you provide something of value to someone else (time, work, a product, a service... whatever), you are rewarded. The amount of your reward depends on mutual free agreement between the two people involved. If you produce nothing that anyone else cares about, you are not rewarded. This is Justice, by the same rule as the corn farmer.

In a capitalist society, if you are poor it is because you are not producing anything for anyone else. If you do anything of value for other people, you are rewarded.

Remember that business is not the only way to provide value: one of the best psychological rewards people can get is from helping other people. It feels good to help someone who you think deserves the assistance, and that good feeling is a value. When you donate to the Red Cross, you are buying that nice warm fuzzy feeling, at a free trade like anything else of value.

The problem with government solutions is that they are paid for by taxation, and you don't have a free choice about paying your taxes. So whether you support the cause or not, if government gives to it you are forced to pay for it. You are exchanging your effort for nothing, or in some cases even negative value.

For example, if you believe that evolution is an evil teaching, tough $#@!! The product of your effort is going to support this evil teaching, thank you government. If you don't like it, tough luck. In a private system, people only have to support the causes that THEY deem worthy of support. You can pay for a school that teaches Pastafarian Creation Theory if you like.

Another great example is the Katrina disaster. The Red Cross was there beforehand, evacuating people. They were on the scene, providing serious aid... and then the government moved in (late) and ordered them out. The government forces wouldn't let anyone else in to deliver aid, and completely botched the whole thing. People got sick and died thanks to the poor care the government gave them. Now, I chose to give to the Red Cross because in my judgment it is a well-run organization that has excellent response to disasters like Katrina. Why was my money taken to support the numbnuts who messed it up, instead? I didn't get a choice about who I thought was better for the job, I was forced to support the $#@!ty alternative.

[user]

Capitalism is NOT a way to end poverty.

I agree with your post, but I think capitalism is a way to end poverty. I know what you're saying is that some people will choose to be poor by not working, but I really think the vast majority of the world's poor would be glad to work for a living. Capitalism and freedom are our best weapons against poverty.

[vertesc]

yes they are, and I agree that many people would be glad of the opportunity to improve their lot with hard work. But not everyone. Capitalism is not a system that has much MERCY. It has near-perfect JUSTICE, however. The two are opposites.