What's good reading on the inefficiencies of capitalism?

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ultraviolet's picture
ultraviolet
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Sep 24 2011 00:27

Great thread + responses so far.

Another recommendation is Robin Hahnel's book "Economic Justice and Democracy" -- I think it's in chapter 4 where he presents various criticisms of capitalism, including a section on its inefficiency. Even if you aren't a fan of parecon, you can still respect his insightful analysis of the problems with capitalism.

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yoda's walking stick
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Sep 27 2011 03:22

This might be an obvious question. If so, I apologize.

But can someone explain to me the difference between efficiency and profitability in this case? I know the difference intuitively, but I'm having trouble putting it into words. And that to me is a sure sign that I don't understand a concept completely.

Camejo:

Quote:
Did you know that because of the way the system is structured a large percentage of the people do not do any productive work at all? You have the unemployed who are not hired because it’s not profitable to hire them.

If it's unprofitable for a private corporation to put people to work, would it be inefficient (but morally necessary) for a socialist society to do so? Or is that private profits and societal efficiency are two different things? The unemployed likely rely on a state program of some kind, so the government is essentially paying to reproduce labor that is not done. So all of that potential is essentially being wasted when it could be put into a massive public works project? Is that the argument?

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ultraviolet
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Oct 13 2011 04:26

To answer your question directly above, in an anarchist society the total amount of available work will be shared amongst everyone who is able to work. Not shared exactly equally, but roughly so, with differences according to ability. There will be no "unemployed" because that's defined as those who are seeking work but can't find it. It's not inefficient to distribute available work between everyone able to work. Just try to think of a reason why it would be.

So why doesn't full employment happen in capitalism? Full employment means workers have greater bargaining power against capitaists. Labor becomes scarce so wages go up (true to the law of supply/demand). So capitalists obviously oppose this and that's why there's never been true full employment in a capitalist nation. Rising wages can also lead to high inflation, so even though full employment is good for the working class, in capitalism you are often damned if you do and damned if you don't so solving one problem creates another. And for true full employment in capitalism to occur, we'd have to all reduce our work hours to create the demand to hire new workers, which would require the government to pass a law to enforce this (unlikely), and even if that occurred you can bet capitalists would not want to give us a pay raise to make up for those lost hours.