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Post By
neil

In Reply To
mtyoung

Subj: Re: How isn't it?
Posted: Sat Dec 29, 2007 at 12:19:34 pm EST
Reply Subj: Re: How isn't it?
Posted: Fri Dec 28, 2007 at 12:41:36 am EST

Previous Post

> > The spirit of the free market insists on contracts with the individual, not contracts with the group.
>
> It doesn't work with corporations, then, which are never individuals. So if the businesses have themselves consolidated the economic power of many into one entity, it only makes sense that the laborers would do the same, does it not?

In economics, a corporation is treated as an individual. You can't argue that one.

In a free market system, there are no alliances of any kind. Companies do not form alliances, workers do no form alliances. Like I said, this is an ideal system. In the real world, people do form alliances.

The fact that unions are based on socialistic ideas should be a big hint that unions and capitalism/free market are at odds with each other.

> > 1) The free market hates the unnatural distortion of equilibriums.
> > 2) Unions unnaturally distort the wage equilibrium.
>
> The problem here is that equilibrium is ill-defined. As an imaginary/ideal concept, it lacks any sort of referent and can be defined and redefined willy-nilly. So I don't see how it's useful to agree or disagree with statements of these sorts.

Equilibrium is not ill defined. Its has a definition. An equlibrium is a situation in which the price has reached the level where quantity supplied equals quantity demanded. It's just that the amount depends on the supply and demand of a product, which changes.

> > If your company wanted to pay you less, you would not accept.
>
> This is where the ideal breaks with the real, again. I'd suggest that the great majority of people are working for less than they want to work, but that they continue to work out of necessity - they are willing to work for less than they want because they don't know that they are able to get what they want. Or simply won't risk losing what they already have.

No. People work at a price that they are willing to work. No one works for a price they don't accept. People will always want to be paid more, just as corporations will always want to pay them less.

> Your notion of the free market, then, strikes me as incredibly classist - it assumes a mobility of the laborers that simply isn't there.
>
But since a free market is ideal, there are no restrictions on laborers.

I'm not saying that we should/could ever go to a completely free market. Only that our current market needs to make moves to more closely resemble a free market.

> > As I have stated, a free market is against anything that limits the number of players in a market.
>
> The free market wants and is against absolutely nothing - it's a catch-phrase, nothing more. Your anthropomorphization of an economic concept is kinda weirding me out.

The free market is an idea, much as true democracy is. Both are simply not viable in the world. However, that doesn't mean we shouldn't make moves to resemble a free market, just as it means we shouldn't make moves to resemble a true democracy.

The way I see it, the problem isn't my "anthropomorphization", but with your nonacceptance of stated economic principles.

> > A free market is based on individuals doing what is best for them as individuals.
>
> And since neither corporations nor unions will ever be individuals, this discussion is entirely academic, isn't it?
>
> -neil

Since a free market would never exist in the real world, the discussion is entirely theoretical .

This side-discussion started because someone wondered how labor unions worked against the principles of a free market. You have since debated the fact with me. With your statements, I wonder about your grasps of the science of economics. Maybe you are an economics graduate student or professor and by some chance I am completely wrong here. But based on what I learned through countless classes, readings, and lectures, I feel confident in my statements here. I am curious to your background in this area.


> In economics, a corporation is treated as an individual. You can't argue that one.

Of course you can. A corporation is a company formed through an economic agreement of individuals with various interests and involvement. It is, functionally, the same as a union - whether it fits with economics doctrine to admit it or not.

Economic theory, like any other disciplinary approach to the study of a system, is ideologically motivated - the only reason it treats corporations as individuals is because it's in their interest to do so.

> The fact that unions are based on socialistic ideas should be a big hint that unions and capitalism/free market are at odds with each other.

'Based on', sure, but unions are hardly oriented toward these broader goals anymore - in practice, they're aimed simply at the best monetary result for their membership, and those traditional concerns are mostly ignored. In this way, they are again very much like corporations with shareholders.

> Equilibrium is not ill defined. Its has a definition. An equlibrium is a situation in which the price has reached the level where quantity supplied equals quantity demanded.

And this is why it's ill-defined/imaginary. There is no point at which one can equivocally say that supply and demand exist in a one-on-one ratio in any product's context - because such a conception assumes the mututal exclusivity of that product, as if it can ever be isolated from all other connected products, industries, and contexts. And so it's a resoundingly reductive and entirely unuseful concept.

> But since a free market is ideal, there are no restrictions on laborers.

Which is funny, because you say that they couldn't form unions. So "free" in economic theory is something of a misnomer, at best, isn't it? It strikes me that your freedom - as an asset - would be the most valuable commodity in a free market.

> With your statements, I wonder about your grasps of the science of economics.

And with your own, I'm wondering if you've ever studied this stuff outside a textbook - or ever looked at workers' perspectives. Or ever looked to other disciplines to critique its weaknesses.

Your take on unions is particularly dogmatic and backward-looking; and your refusal to accept that corporations are not singular entities similarly so.

> I am curious to your background in this area.

From a counter-doctrinal perspective - political theory and critiques of globalization, and I'm a PhD student in a Social and Political Thought program. (But I can't offer particularly strong defenses of unions because I largely think they've turned too classically liberal - that they are run like corporations. If only the 'socialist' unions that you wrote about existed...)

-neil


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