to not understand capitalism

[IceBeing]

Some people work hard (say 60 hours a week all year) and get paid about £20000 a year...and some people work hard and get paid 10 or even 100 times as much a year.

How can 60 hours a week of work from 1 person be worth 100 times as much as 60 hours a week of work from another person?

The theory is supply and demand of labour.

If what you provide is 'demanded' (ie people need/want) and the is only a few who can 'supply' then the price of that good or service increases.

There are factors that affect demand - is what people want/need and factors that affect supply too - that is what producers of goods and services are willing to make/do using the resources available.

spare how would companies no longer paying massive inflated amounts to a few people spend their money? Oh I don't know...maybe employ more people and reduce unemployment? Sounds dreadful....

reg no I am not specifically against bankers...its not their fault that the system of capitalism belches up such inconsistencies as people doing nothing useful for vast salaries.

It is a fair point that I have a pension. But as it is not performing in any sense above inflation, mostly because of the huge number of parasites in between the actual stocks and shares and the pension fund contributers I cant see that I have a demand for said parasites...if anything I have a demand for them to feck off and stop stealing my money.

Banking is different though. Supply and demand in its simplest form applies to goods - you have a carrot I want so I'll give you a potato. If there are very few potatoes I'll have to give you a lot of carrots. Money replaced this simple form of barter so I can weave baskets for the town and then use the money they've given me to get carrots from the farmer, who doesn't want any baskets. Bankers are the next level up again. They exploit people's desire to gain money and hold onto money in a very simple way - they say "we'll look after your money but we need cut of it." They do the adding up, the writing down, the exchanging for people and in they make quite a simple process just complicated enough that ordinary people can no longer do it for themselves. Therefore they make people dependent on them. Simple barter is no longer possible. And value becomes theoretical. So to function in society you have to play by the rules of banking. That power allows a lot of control, and allows you to exact quite a large premium for your "services."

I was talking to someone the other day who has sold their house and is planning to invest. I told her I heard a radio 4 programme that calculated that on average you don't make money off investments in the stock market any more....unless you go it alone. If you invest with any sort of managed product the average return is less than inflation....because of all the people taking a cut.

callin so would you agree they are virus like? An unavoidable consequence of a money based system?

Virus like is a strongly negative term. They are an inevitable side effect of capitalism. Governments keep them under control to a certain extent through regulation but there is only so much they can do.

ohh I have a non-financial sector example of capitalist success that is a fail at all levels....

the cosmetics industry...specifically scented tampons.

tampons do not need to be scented. In fact it is harmful for them to be so. But you can charge more for a new product (and then charge more for unscented as a 'special variant') and then....this is the REALLY smart bit...you can charge even more for the products that put right all the shit that happens when you use the first product!

Massive capitalist win (money in the pockets of a few people in charge at P&G etc). Massive society fail (young girls with even more hang ups about their bodies and major thrush issues to boot).

There's a chicken and egg issue with that though IceBeing. You can make all the products you like but if people genuinely don't want them then they just won't buy them. So, to use your tampon example. Women biologically need some way of controlling menstrual flow. We live in a historically misogynistic society that ignored women's needs and so for centuries women just made do with old sheets etc and there was no market for sanitary products. Changes happened in the twentieth century that meant the secrecy and disgust around menstruation lessened and so a new market opened up for sanitary products. This was essentially a good thing. The people who provided the sanitary products, however, were merely doing a job. They wanted to make money from selling tampons. So they employ the tricks you talked about, to get more money for their product, to stimulate demand, etc. But if no one wants their product, no one will buy it, simple. Many many thousands of products have failed on that principle. So if there's demand for scented tampons where is that demand coming from? The answer isn't simple.

Ice, you asked me how recent high news failures are punished for cocking up - I presume you're on about the bankers - for that I have no justification.

However, for other high salaried roles you have a consequence:

Brain surgeon, patient dies; pilot, passengers die; etc (you get my point, without me reeling off examples).

Also, just because a person has 4 degrees it does not necessarily mean their skill set is greater - it depends wholly on what they're in and how they translate to a real skill set; lawyers/surgeons etc spend a long time doing specific training to get to the point that they have worth in their field.

"Of course they cannot afford to pay them the same. Not to mention many people can work on a till...very few have the abilities to be a CEO."

Lots of people have those abilities, it is nothing to do with ability that CEO pay has trebled through the shit economy of the last decade, it's greed. Pure and simple.

They will take as much as they can get away with.

On other forums, where one is allowed "signatures" next to usernames, I have the motto
Counting the Beans £1, knowing which beans to count £99

Anybody can do accounts
but it takes years of experience and training and CPD to do them WELL
and I charge for that.

With regard to scented tampons, I just wouldn't buy them. If the rest of the country was of the same mind set as me, there would be no demand.

I also have the option to use a different brand or a different type of sanitary protection, thanks to capitalism and competition.

I also have the option to use a different brand or a different type of sanitary protection, thanks to capitalism and competition.

This.

Also, the OP mentioned above, she'd rather pay a bin man than a footballer. Personally, I'd rather take my rubbish to the tip myself and pay for some entertainment than have by bins emptied and rubbish spilled everywhere and have nothing entertaining to cheer for on telly.

different strokes and all that...

Sorry, hit enter too soon. That's what capitalism is all about, OP. It's about one person thinking, "I don't like the way this is done... There must be others who dislike it as well. I'll provide an alternative."

Some work. Some don't. But anyone can have a go at it.

Ice So companies should just have lots of people sitting around, being paid, but not actually doing any work? Just to deplete money?

So if Salesman A was previously earning £250k a year, but now has to take a paycut to £150k a year because of the 10x rule, can he employ his son as his PA on £100k a year to keep the household income the same? Even if the son is actually at university and doesn't actually do any real work?

AgaPanthers
If so many people have the abilities to be CEOs, why have some companies gone to the wall or close to it, only for a new CEO to step in and save it?
That suggests that even some CEOs don't have the skills, let alone Joe Public.
And if a CEO steps in and saves a company, and with it hundreds or thousands of jobs, should there not be a big financial incentive to do so?
It is, after all, very much in the interests of everyone that works there that one person is hugely motivated by money, and is willing to save the company in order to get that money

Well indeed, sparechange, you're right that that suggests that many CEOs don't have the skills.

I don't know, however, why you suppose that that should mean that Joe Public should be worse. There are lots of supposed genius CEOs who go on to fuck up somewhere else. The fact is that success is often a result of luck.

I don't really see that being hugely motivated by money should mean you get paid 200 times the average salary. I know people hugely motivated by money who will work stupidly hard for a few thousands pounds extra. The idea that if you don't chuck millions at these people, then they will just down tools is frankly ludicrous.

"I have no demand whatsoever for stock brokering bullshit."

The people who provide your food do though.

Also, even people at the head of communist systems of government are capable of appropriating an unfair amount of resources to themselves and they still require banks.

In a capitalist society I am sure that it is quite possible to find somebody who will provide a bespoke, private bin collecting service if you want to pay more for this service.

cailin but companies create demand by undermining peoples self esteem...nobody needs a scented tampon...it will cause more problems than it solves (which is zero) but if you do enough advertising you will convince lots of (young) women that they need it...because they smell bad (when they don't).

My problem with capitalism is entirely down to this one thing I think. That it allows people to create spurious demand for shit things that actually harm them.

It exploits all the worse aspects of human nature.

Banking isn't as simple as looking after money. If that were the case we would all just buy safes.

More important is that they take savings and lend them to others, thus enabling the borrower to e.g. start a business and the investor to charge interest or take a share in the profits which helps them to e.g. save for a pension.

Aga, I don't really understand your point
Being a CEO is something everyone can do, or something hardly anyone can do?
Being a FTSE CEO is probably a bit like being a footballer in a lot of ways.
Lots of people can run companies in the way that lots of people can have a knock about in the park. Someone can do it well enough to play for 2nd division teams, but only a handful are good enough to do it at the top level.

And just like footballers, when CEOs are doing really well, they can get poached by better offers from overseas places.
If you don't think top execs will down tools and go somewhere else for a better offer elsewhere, taking their families abroad if required, then you have clearly never ever met either a top exec or a headhunter of top execs.
There is a reason that there is an entire page in the FT every day of people moves. These people move for better offers, and will carry on doing so.
The reason they get better offers is because they can do the job better than anyone else.

Those lower down the food chain who will work stupid hours of a few extra thousand (and I think I am one of those) do that because there are lots and lots of other people who can do the job just as well for roughly the same salary, which is why there is no motivation or incentive for their employers to pay them top whack.

"it allows people to create spurious demand for shit things that actually harm them."

or they buy a moon cup.

Its just all the sadness caused unnecessarily....by the drive to possess things that we would be perfectly happy without until we knew someone else had one.

Witness bridezillas in search of the perfect £20K wedding....or people who 'need' the latest flash gadget/car/computer/whatever...

and the massive futility of removing all of your bodies natural defences against bacteria and infection and replacing them with synthetic shit that will like as not increase your risk of cancer etc....

all so someone else somewhere different in the food chain can also afford to buy the same useless gadgets/bridal shower outfits/ and try against all odds to believe that the possession of said items makes their existence a success.

Where do you think that drive to possess things comes from IceBeing?

Capitalism is very simple. It's just supply and demand.

My dressage instructor, for example, is absolutely brilliant so I happily pay him £40 for half an hour. He's worth every penny.

My cleaner is good but I pay her £10 an hour because anyine can clean, essentially and it woudl cost me £10 an hour to replace her.

Company Directors usually earn a lot of money as they create jobs and money. My husband's company is expanding rapidly and employing new people who are now enjoying the fruits of that success so he is financially rewarded accordingly.

Seems pretty fair and pretty striaghtforward to me.