Myth: Income disparities wouldn't exist in a laissez faire economy.

[FreeEcon]

Correct, but you assume that income disparities are problematic, which is incorrect. If everyone's income tripled, disparity remains the same, but everyone is objectively better off.

[JohnColt]

@ineptsegue Anybody who argues that, under true L.F there would be no income disparity, doesn't know what they're saying; but I've never heard anybody say that, so I would appreciate it if you would provide a citation to support that claim.

However, it IS argued that under L.F there would be less income disparity than there is now.

As for so called "economic coercion", Libertarians argue that L.F. is the system under which people have the MOST choice - that's the WHOLE POINT :D

[JohnColt]

That quote at the beginning - where is it from? I've certainly never heard anybody argue that laissez fair would mean no income disparity.

The important questions are: as long as A isn't coercing B out of his or her money, why shouldn't A be wealthier than B? And, if B is less wealthy than A, is he justified in coercing A out of his or her money?

[Ibnmazin101]

@ineptsegue Thats your assumption. Corporatism only exists with government intervention.

You can give government the role to incentivize things, but you have to explicitly provide situations where the private market doesn't institute enough incentives

[Islam781]

@ineptsegue Thats not the issue. The issue is that governments often end up getting in the way by not accurately gauging human needs, while the free market comes closest to solving the issue.

[Islam781]

@ineptsegue Where am I insulting you? Have you not insulted me by calling me a person of "great privilege" in a sneering way?

Youre mentioning a lot of things but not providing a single example. I don't nitpick. I just respond to the little concrete material you have.

[Islam781]

@ineptsegue And you continue to ignore the statistics, which shows that economic freedom is 54 times more correlated with peace than political freedom.

Let me make this very clear to you. Corporatism is not Capitalism. If you can't grasp the distinction, review your understanding of political economics.

Now, what other situations does government perform a better job than the market?

[Islam781]

@ineptsegue Maybe this subject is a little over your head.

People are dying of malaria because governments are not permitted to use DDT to kill mosquitos. The Minister of Health from Uganda went on 20/20 a few years ago and said that international bans on DDT is killing his people. So, yes, how arrogant of you to say that people shouldn't decide for themselves what they prefer

[Islam781]

@ineptsegue A superficiality in the case that youre suggesting the government understands our interests better than we do. The money that goes into fighting malaria and into ice cream is determined by how much of a priority each is to the consumers. If malaria is not considered a problem, people won't pay to fight it. You think you know how to take care of people better than they do. YOU are a speaking like a person of great privilege.

[Islam781]

@ineptsegue Capitalism is undermined by war, but at the same time is, according to the Fraser Institute, 54 times more correlated with peace than political freedom (using economic freedom and comparing the data with Freedom House and the UN's World Peace Index).

Yes, governments can do good when they limit themselves to the tasks I laid out.

[Islam781]

@ineptsegue And I actually have refuted the claims you make when you reference your site. You haven't responded

[Islam781]

@ineptsegue Thats a superficiality. Yes, the money we put into ice cream would help malaria. The topic of debate is who should decide that, us or someone else

[Islam781]

@ineptsegue There were very little comparative negative effects of DDT to us, when compared to the damage malaria causes. This is a tradeoff, in other words, what is of greater importance?

The issue here is not just result but degree, and just because markets don't provide sufficient results doesn't mean govt will

Again, if there is governments using force, its not capitalism. And before you say there isn't a place where this isn't the case, two words: Hong Kong.

[Islam781]

@ineptsegue I already answered to both those myths. Rehashing them isn't do either of us justice.

And how does capitalism use force if force is banned?

And how does the market prioritize your ice cream above curing malaria? Besides, of course, you saying so. Mind you, DDT, which would limit malaria, is banned by government. It was also thanks to the free market that Paul Hermann Müller discovered DDT's insecticidal functions.

[Islam781]

@ineptsegue You also fail to address two points I am making. The first is that absolute poverty in proportion to the world's population, is falling. The second is that real wages and compensation is rising. This flies in the face of the claims you have been making

[Islam781]

@ineptsegue And its not at all arbitrary. It is only under capitalism that A) People obtain wealth by serving the interests of others and not through force, and B) People are free to organize and associate as they wish. Under capitalism, it is very possible to create a socialist commune, if you wish. Its called voluntary association. The difference in my thinking is that you shouldn't force any one to be a part of this

[Islam781]

@ineptsegue So youre saying charity is insufficient because people keep more money for themselves? Are they not permitted to use their wealth as they please and, more importantly, keep it for themselves?In other words, can they justify their existence without using their wealth to help others?

[Islam781]

@ineptsegue Well, I like reading and learning. That's two reasons.

Out of curiosity, why haven't I earned your respect? Apart from, of course, me not agreeing with you. And what do I have to do to win you over?

Remember that you do throw alot of recommendations at me, and I do read them, but why do you A)expect me not to and B) not take my recommendations? the Fraser Institute's summary is less than the combination of your rebuttals.

[Islam781]

At least, that's my inevitable conclusion

[Islam781]

@ineptsegue I don't like the idea that we have borders as well, but you don't have to let people suffer and die; just give them your money, but don't force any one to give them theirs. I don't have to prove a negative-you have to prove why people are entitled to something, and define what that something is.

You also have to prove why charity is insufficient, but that would essentially mean you consider most people to be too selfish to do what you consider is right and therefore have to be forced

[Islam781]

@ineptsegue I suggest you look up Johan Norberg's In Defense of Global Capitalism

[Islam781]

@ineptsegue Government doesn't have to be inefficient, but most of the time it is. See monopoly effect.

As for the second part, let me remind you how the more a society improves, the less there is to improve on. For example, if all diseases were cured, you can theoretically complain that there haven't been as many medical advances. The fact that absolute poverty has been declining and the fact that real wages and compensation has been increasing debunks this claim.

[Islam781]

@ineptsegue Well, physical coercion is bad, is it not? All other cases, people are free to pursue whatever interests they may have. The keyword here is pursue; no one is automatically entitled to any standard of living by default.

I never said the profit motive addresses every social goal (not that we need to have collective goals). Everything the profit motive doesn't address is addressed by voluntary charity. The Fraser Institute's research debunks the rest.

[Islam781]

@ineptsegue I think you miss the point on the laffer curve. My point is that you can't rely on the government to redistribute wealth if it makes the allocation process less efficient.

I never claimed our wealth distribution is balanced, and balanced itself is a relative word (balanced as compared to what? What is imbalanced?). What I can argue is that A) absolute poverty around the world is declining, and B)real wages and compensation are rising.

[Islam781]

@ineptsegue When do people only have bad options? And who is harmed by the profit motive and when?

[Islam781]

@ineptsegue Thomas Sowell points out in his book Dismantling America that most of the people in the top and bottom 10% are usually there temporarily, and enter and exit that section in a span of a year, maybe a few years at best.

Now, as for Fraser, google Economic Freedom of the World 2010 Annual Report. I haven't read through all of it, but the one from 2002 has a section entitled Concluding Thoughts (p. 18), which shows statistical relationships between economic freedom and other attributes.

[Islam781]

@ineptsegue I'm not sure when you have only been given bad options. There are tradeoffs, yes, but always benefits to competition. Companies can't trust each other to reduce quality and benefit for the consumer (that is, if their interests were somehow to be malevolent), so they raise quality and utility to beat others to the consumer.

But, again, a rigidly divided class system and a very small rich (not necessarily powerful) class is not the consequence.

[Islam781]

@ineptsegue Hmm, interesting data. You should download a software from gapminder (dot) org, which allows you to compare different attributes among countries, including income equality/inequality.

[Islam781]

@ineptsegue Well, there is the problem. While the free market is not a zero sum game, government redistribution is, because government does not produce wealth. Rather, it divides the wealth that is in existence. If anything, it decreases wealth by reducing incentive and in fact making it more attractive to hide one's wealth, which people do. Look up Laffer Curve.

[Islam781]

@ineptsegue Looking back, I feel you may have misunderstood what Friedman meant. He wasn't disputing the importance of equality, but he was disputing the conventional method people assume it is achieved, namely by taking away freedom in the economically conservative sense.

[Islam781]

@ineptsegue (continued) and yet there are more people now than ever.

I am not sure what statistics you are referring to in regards to equality, but I recall reading a study by the Fraser Institute regarding economic freedom and benefits to society. I suggest you look it up.

[Islam781]

@ineptsegue Think about this, does Bill Gates being made $50 billion richer by inventing a new computer make the rest of the world $50 billion poorer? Given the jobs he creates and the level of comfort his inventions bring, both explicitly and implicitly, I would say no.

You give a lot of emphasis on income disparity, but not on how much more well off people are in general. Real wages are rising. Absolute poverty is falling percentage wise. People are better off now than ever,

[Islam781]

@ineptsegue Well, what do you mean by "actual" freedom? My definition of freedom is allowing people to pursue their own interests and objectives as long as they do not physically harm or force others in the process (this indeed includes fraud as well).

You also bring up the fallacy that wealth and business is a zero-sum game, which is not the case at all. In a voluntary trade, both parties benefit, because both see an interest in making that trade.

[Islam781]

@ineptsegue I would also like to point out a quote by Milton Friedman: "A society that puts equality before freedom would find itself to have neither. A society that puts freedom before equality will find that it has a high degree of both."

[Islam781]

@ineptsegue ...Successful in what way? I have once been to Kazakhstan, which has high equality. Doesn't generate much results.

I recall once reading Kurt Vonnegut's Harrison Bergeron, which depicted a dystopian society where everyone was equal. I know thats not the level of equality you are encouraging, but your assertions beg the questions: Where does this go? Where does this end?

[Islam781]

@ineptsegue ...Well, has it been determined? If so, what is such a system? If not, why do you assume it is possible?

[Islam781]

@ineptsegue Who is to decide for us what is the balancing point and when it is achieved.

[Islam781]

The problem is that your assumptions about what happens in a laissez faire society doesn't measure up to reality's closest examples of pure capitalism, such as Hong Kong, New Zealand, and Switzerland. You do mention that people vary in skill and talent, and they would inevitably vary in income as a result. And wouldn't you agree that voluntary charity is a perfectly suitable alternative?

[GoingGoingGalt]

According to the Fraser Institute's survey of economic freedom of countries, there is no correlation between the economic freedom of a country and income share of the bottom 10%. Also, stealing a line from Margaret Thatcher, "You'd rather have the poor be poorer provided the rich were less rich."

[Beingism]

@GoingGoingGalt I'll tell you what, though: There's definitely a correlation between the number of collectively-funded research-based programs that aim to end poverty/homelessness/etc and the amount of poverty and homelessness. You and Thatcher might think we're megalomaniacal and bent on reducing the world to poverty, but doesn't it seem more likely that we have a different idea about how to address it? Please, go find another set of videos to troll. You've used up your goodwill here.

[Skyler827]

@ineptsegue Somalia does too have a government! Governments are the same kinds of things as mafias or gangs of thugs. And there are definitely mafias, gangs, and thugs in Somalia, and they are just as immoral. Don't you see? The evil corporations running our government are not serving us, they are serving the wretched government that takes our money with threats of violence, without consent! The evil screwing of the American people cannot happen if there is no government to serve!

[Skyler827]

This video is entirely based on biased conjecture. Do you have any idea how fundamentally governments run everything in our society? Do you have any idea what societies without governments would truly look like? Have you considered what people would make if there were no income taxes, no social security, sales tax, labor regulations, licensing requirements in every industry, payroll taxes, national debt, Fiat currency, and boom-busts cycles? Do you think that would hurt the middle class?

[chorizo1337]

@ineptsegue So hows Greece working out?

[Beingism]

@chorizo1337 I agree, socialism for the rich and capitalism for the poor isn't a good system.

[chorizo1337]

@Beingism "capitalism for the poor" You mean poor people not being able to trade with others, or start up a service like landscaping and other services etc is bad? That's what allows them to generate wealth for themselves and their families.

[Beingism]

@chorizo1337 I mean "poor tax collection system allowing the rich to move money to tax shelters." See: blogs.euobserver [dot] com/irvin/2010/03/02/greece-so­cialism-for-the-rich-and-capit­alism-for-the-poor

[MigDanskeren]

A myth needs to be widely accepted to be a myth, and I have never met anyone who claimed that income disparities would not exist in a laissez-faire economy. I call straw man.

[chorizo1337]

I actually think income desparities exist in all systems, but in socialism you have alot more income disparities. Look at wellfare

[ravaneli55]

Funny. Great arguments, only I don't understand where you got it that lasseiz faire will create a perfect world. Nobody claims that. People will still die from starvation. But this is the best available state of society. Nothing else has the same personal and economic freedom and overall standard of life. America was the greatest when the government was the smallest. Name one federal department that has not created disaster. Healthcare, Education, Energy all suffered after creation of fed depart

[ThePuppin]

I've never ever heard anyone claim - ever - that a laissez faire economy would eliminate income disparities. But then, income disparities are not a necessarily bad thing or a sign of abuse or anything like that.

[catgumart]

I'm wondering what makes people think is going to motivate anyone who is rich in a free market system to help anyone who is poor or disadvantaged.

[ThePuppin]

@catgumart Probably that the US - one of the most free market economies on the Earth - is the most charitable nation on Earth. All those nasty free market capitalists contribute considerably more to charity than other nations.

[DarthKazi]

I'm far from a rich person and would easily be lumped into the "proletariat" group in the Marxist paradigm.

This paradigm still remains in the left "analysis" of poverty. Appealing to forceful redistribution of wealth and the controlled allocation of goods and services does not create "equality". This very idea, actually reduces the capability for individuals to succeed. If you are against billionaires, you have to also be against self-made millionaires and all business owners.

[Ranillon]

@DarthKazi The problem here is that you are assuming that the wealth was obtained "fairly" in the first place -- that is, purely from hard work and adding value to the society as a whole. However, that is often debatable. The latest Wall Street meltdown is a great case-in-point -- there is plenty of evidence that the system was manipulated to let a small minority win even as they brought about economic disaster. Your argument assumes that rich = moral which is hardly always the case.

[DarthKazi]

I'm not going to "see" any of your videos to get authoritative economic analysis of reality.

It is evident within the first couple minutes of your "analysis" and attempt at debunkery, that your premises all stand on ignorant and fallacious assumptions of economic laws and basic conceptual illustrations of societal norms. Just stating something is a myth and then misrepresenting the concepts you are attacking, makes for something that does the opposite of what you intended.

[DarthKazi]

None of this stuff debunks laissez-faire. If anything, it strengthens the need for it.

What you are confusing, is corporatist/State fascistic economics or the "Milton Friedman" free-market "laissez-faire" and that of Hayek, Mises, Menger, Bohm-Bawerk, Rothbard, etc... it would be interesting to mention that States of third-world countries are hopelessly corrupt and maybe that might be what's causing the majority of the inequity problems.

[DarthKazi]

The subject of the research is "income disparities in capitalistic societies".

If you are studying "income" and ignore the factors of cost, capital, etc... the labor exponent is easy to factor higher than a practical assessment. Ignoring those variables, makes the "subject" of the research incapable of standing up to scrutiny in a truly praxeological economic system.

[DarthKazi]

What of people, very botanically versed and quality-driven, choose to grow high-quality pot? Do these "black market" people deserve to be sent to maximum security prisons for growing a plant, and doing so in a meticulous, quality way to deliver the highest grade for the best price?

Why are the prices so high?

Why is violence evident in such TRUE free-markets?

What about prostitutes and their "agents"?

Are these corruptions of the "free market"? Why do they resort to these things?

[DarthKazi]

In reading this documents, they ignore very important variables in the equations. Who pays for the big machines, buildings, land rents and supplies that allow people to have jobs? Do shop owners, retailers, etc get to bargain for lower prices with government force to arbiter the transaction? Do people who have garage sales everyday to pay bills deserve to be ticketed and fined for "not having a business license"?

It is government, not "the market" that causes disparity.

[DarthKazi]

That is total nonsense from an sane, economic reasoning. "Equal amounts of labor" = define this. Are we talking about caloric burn during a job? Are we talking about one guy stacking pallets by hand, vs a guy stacking them with a forklift... who should get paid more? The more productive one, or the one who burns the most calories? If you paid them the same, how do account for one being far less productive than the other? Who pays for the forklift... etc, etc.

Labor is subjective.

[DarthKazi]

I don't believe in "economic equality". I also reject positivist, utilitarian or altruistic "ideologies" that involved force to meet egalitarian ends (e.g., Robin Hood social philosophy).

Not everybody produces in accord with their physical labor and not everybody has the mental capability to move more production to make larger incomes. Labor, like value is subjective. Labor is also voluntary and improving incomes is a matter of intent and action.

[DarthKazi]

It's nice to suggest more equality and propose economic strategies to involve the poor in productive activity or the entrepreneurial function. Certainly more "middle men" could be created to make certain areas of production and markets flow better... this could involve less skilled workers.

If people were taught and understood praxeology as a child, their apparent "disparities" could be converted to hope. As it is, poor are taught they will stay that way and be "taken care of".

[DarthKazi]

And I really think that Friedmanites and other similar Chicago School quasi-Freemarketeers have ruined the name of true, praxeological societal functions. "Free" trade now is synonymous with corporate bullies taking over small, poor nations and putting them into wads of unrepayable debt. The true Praxeological "trade cycle" includes nations that CAN produce and trade without coercion, function within the trade mechanism. Those who cannot, do not.

[DarthKazi]

Marxian Labor theories of value have been debunked for many years. What I hear from the "left", is the notion of "wages being too low" and that workers should bargain (collectively or otherwise) for higher wages. These inept manifestations of egalitarian altruism, ignore that business owners cannot also bargain in that way for capital goods, heavy machinery or energy costs. They ignore COST parameters and ignore why these people have jobs in the first place.

[DarthKazi]

There are no examples of these societies since WWI, that's for sure.

What "research" are you referring to? Economic growth includes growth in wages and consumption being a trade-off to investment, as opposed to the Keynesian model of investment being ADDED to consumption. If you are using an Austrian, pure market perspective, you'll understand consumption better than using the other system.

Research generally is dependent on the logical sway of the researcher.

[DarthKazi]

Even IF you actually could cite some examples of unhampered free-markets in a modern age, it's likely you would cherry pick certain instances, rather than seeing the forest for the trees.

The 1880's are a good example of wages INcreasing and prices DEcreasing... an occurrence not possible in a Keynesian scheme as we have today. Government increases wages now by coercion and hikes prices by inflating bubbles, rather than market scarcities doing it naturally.

Very economically ignorant video.