Double Dip Recession

The difference is that the police & army in a democratic/capitalist society do not go around using violence on its own citizens unless a crime has been committed. Even then there is due legal process and you must be tried and convicted by an independent judiciary.

niceguy2 that made me laugh! Do you really believe that?

why are shareholders not bleeting louder?

Because modern companies with turnover of tens of billions pounds is an absolutely different world to model shareholders of a pub with 1m turnover you probably keep in mind. And are making more money on dramatic falls than on stable growth.

I agree with cooperatives but in a system where all sorts of business models are in the market, how can this excessive pay continue to dominate?

I also think shareholders want profit not fairness but the extremity of the increase in pay shocks me and I'm sure does even those rather profit hunting shareholders.

The allowance of such excessive pay is inexplicable to me. The banking industry knows they are losing profit due to inflated pay. Where will this end?

I tend to be a positive person so I do see at some point this will change but I wonder when and how?

I heard today that last year there was a 40% rise noticed in chief executive pay despite fall in growth and profit

That's a really good point because it illustrates perfectly that the money/capital isn't and hasn't been reinvested into growing businesses. Bob Diamond is getting a ticking off by the Barclays shareholders now. The thing is there has been a move towards rewarding through shares rather than hard cash but this is also a case of financialization of capital.

I keep hearing in the news that shareholders are holding CEOs to account but shareholding is actually part of the problem. I really like the idea of co-operatives where everyone owns a share of the company and profits from their own work.

Dear MMMouse,

I'm interested in your last post. I'm wondering how more resources can be directed towards innovation / manufacturing when that requires investment. Austerity means a loss of public jobs but also a lack of confidence to initiate new business ventures.

I also had not thought about large businesses like Virgin instead of expanding core business were diverting into banking.

I heard today that last year there was a 40% rise noticed in chief executive pay despite fall in growth and profit in the private sector. Compare this to all the public servants who lost their jobs. This is not sustainable wage growth and does not help a business so why are shareholders not bleeting louder? It seems to me to be blatantly corrupt.

All those in favour of the free market, how do you see these extreme wage inequities as something positive? I forsee it will cause another crisis of some kind.

Sadly noddyholder you are right, it is all so depressing I can't see it getting any better for the forseeable future especially for the working class.
ttosca hope the move goes smoothly.

Sorry Flatpack, I thought your sharp short response seemed rude. That's call a truce

I agree in many ways our current economic system is very creative and there is always the argument that a different system could fail to stimulate enquiry and discovery. For the record I am as appalled by the mistakes of the past made in the name of socialism, as you are.

The only reason it looks that way is that we had 10 years of credit-card spending which looked like a boom. Systemic growth was close to zero, and negative in many areas yy, as I mentioned earlier and many economists are now saying that the credit boom was as a direct result of downward pressure upon wages. So rather than businesses like GE using their surplus capital to invest in their core business they instead set up credit/banking divisions. So rather than investment into people and jobs, manufacturing and supply many went down the route of not inovating new products and employing but instead looked at the surplus and redirected it towards the financial sector. This is partly because business needs to be profitable (the way in which businesses are owned) and needs to supress wages. Without wages to buy goods workers would take on credit. So yes you are right but it needs to be understood not just at a microeconomic level of individuals.

So in recent years it could be argued that there has been a shift away from innovation in products and commodities useful to all towards a system that makes money from money which actually doesn't have the capacity to keep many people in work and disadvantages the poor and creates huge inequality.

Good luck with your move Ttosca.

minimathsmouse "Are individual capitalist[s] good caretakers of natural resources?"

Yes, Yes and Yes again. We can proove that they are because as a resource becomes scarce it's price goes up. Alternatively, if you look at a farmers field you will find it well managed and largely polution free - it has to be if he is to make any money from it. Compare that to a resource which has no real owner such as the sea. Fish stocks have been decimated by overfishing PRECISELY BECAUSE no one is the caretaker of the resource. Pollutiuon levels have risen in our seas (and air too for that matter) because no one individual takes responsibility to be the caretaker of the resource.

Compare and contrast the environmental standards on either side of the old Iron Curtain before you accuse me of talking nonsense.

hahaha exactly!

That's funny.

Anyway, I am relocating today. I'll try to come back to this thread once I get settled.

The difference is that the police & army in a democratic/capitalist society do not go around using violence on its own citizens unless a crime has been committed. Even then there is due legal process and you must be tried and convicted by an independent judiciary.

Hahahahahahaha!!!!

This is worse than the 30s and the only reason many people aren't literally out with the begging bowl is because of credit like credit cards which wasn't available then. But this credit is running out. If you can lower your outgoings and think along the lines of need rather than want you may protect yourself. This is what I am doing. I scrimped for years to be mortgage free when ds was little we never had holidays cars etc while my mates all lived the life of riley!Now the majority of them are struggling and see cutting back on luxuries as some sort of punishment!

minimathsmouse

Flatpack are you being purposefully dim?

No need to be rude. I'm asking you to clarify your position.

^"Capitalism like any other mode of production relies on the beneficence of nature. The depletion and degradation of the land and so called natural resources makes no more sense than the destruction of the collective powers of labour since both lie at the root of all wealth creation."

Are individual capitalist good caretakers of natural resources?^

No worse or better than communists. If you doubt me, I advise you to take a trip to Budapest and take a look at the surrounding area and the condition of the Danube. Soviet-era steel production technologies turned the river sterile and multi-coloured.

"Working on their own short term interests and impelled by the coercive laws of competition (they) are perpetually tempted to take the position of apres moi le deluge with respect to both labour and natural resources"

Resource scarcity creates efficiences in the use of that resource. Take as an example computer chips. The amount of resources required to build a modern computer are far less than those required to build an equivalent machine in the 1980s. Circuits which were 0.01mm thick in 1985 are now just atoms thick. The amount of resources required to produce the same result has reduced by a factor of 1,000.

^This is being played out now, we have disempowered labour who can not stimulate demand in the economy for goods and services and we have finite resources which are becoming not only short on supply but prohibitively expensive.The individual business owner does not try to rationalise his behaviour which means that the collective whole results in the situation we have now.
Ref: DR D Harvey^

As we run short of one resource we start to use another. It's efficiences like these which only come from the innovation in the capitalist system. Command economies do not innovate.

Much of the contraction in our economy seems to stem from construction and seems in part down to the fact that government is not investing in housing.

The only reason it looks that way is that we had 10 years of credit-card spending which looked like a boom. Systemic growth was close to zero, and negative in many areas.

We were never really 'out' of recession. I think this is the beginning of a long period of austerity. Many senior economists think we will not see a buoyant economy this generation. We were fed the debt myth everyone believed it was wealth and now we are paying for it. A whole shift in thinking needs to occur to get us out of this

i don think its capitalism that creates short term thinking, its human nature

voters think short term
policitians think short term

'people gladly believe what they would were true'

Flatpack are you being purposefully dim?

"Capitalism like any other mode of production relies on the beneficence of nature. The depletion and degradation of the land and so called natural resources makes no more sense than the destruction of the collective powers of labour since both lie at the root of all wealth creation."

Are individual capitalist good caretakers of natural resources?

"Working on their own short term interests and impelled by the coercive laws of competition (they) are perpetually tempted to take the position of apres moi le deluge with respect to both labour and natural resources"

This is being played out now, we have disempowered labour who can not stimulate demand in the economy for goods and services and we have finite resources which are becoming not only short on supply but prohibitively expensive.The individual business owner does not try to rationalise his behaviour which means that the collective whole results in the situation we have now.
Ref: DR D Harvey

Much of the contraction in our economy seems to stem from construction and seems in part down to the fact that government is not investing in housing.

Good job we never joined the euro, innit?

Why would you need to 'protect' resources? What're you going to do with them? Leave them in the ground? Which resources do you think we're short of?

the land with oil is more valuable than land without oil.

the person who knows how to get oil out the ground is more valuable than someone who does not (in the context of getting oil out of the ground.)

Which resources in particular does the capitalist mode of production seek to preserve?

If you are referring to natural resources and the environment you see that no such protection of resources or environment occurs. Competition is not a way of protecting finite resources. Also if we continue to allow corporations to use the finite resources in the manufacture/exploitation of markets producing and selling non use/non use value commodities we will end up with a very big problem in the future.

Not even natural resources have a value until the point at which the labour process is employed. Oil has no value where it is to be found, it is the labour process that gives it value and the value we confer upon it because we choose to use oil in things such as agrochemicals for farming. We don't need to spray crops with agrochemicals but we choose to because we choose to use less labour in food production and thus use more finite resources instead. Why? because capital dictates that surplus unemployed labour is disempowered and cheap and oil should be expensive & finite and in the hands of a few. This will not preserve resources, instead it is using resources in short supply to the disadvantage of small producers who through competition lose out.

What is being produced is cheap from necessity, it has to be because the workers can not demand goods of higher value, this feeds into the need to suppress wages lower.

some wages are stagnating and others have skyrocketed and this is gross! The dissenting voice is important to politics just as market forces are.

I like the idea where we trade commodities - too radical though , so is a non- starter. Is there a half-way house?

all of them.

What you are describing Mini is the law of supply and demand. And yes, that works for both labour as well as commodities.

Ultimately that's exactly what is happening.

Our labour market is now pretty much global. People abroad can and do compete for our jobs each day. I should know, it's the industry I'm in.

So the cost of labour abroad is slowly rising, ours is dropping/stagnant in order to compete.

Which resources are finite?

an abundance of commodities

where are you going to get these goods from? resources are finite....