Pursuing self-interest and being selfish are not the same. — Tzeentch

Truism, yes. Rand would say the same thing. And yet, look at the consequences. She was a staunch “laissez faire capitalist”. Turns out most people who talk about “self interest” (Friedman, Hayek, Mises, Sowell, Ryan, etc.) just happen to advocate for policies that have eroded democracy and lead to inequality not seen since the pharaohs.

It’s just cover for being a selfish asshole. That’s all it’s ever been. It’s taking “I should have the right to own slaves” and making a theory of it. All under the guise of “we’re all pursuing our self interest!”

Yeah, no thanks.

Why this resentment towards the most natural drive imaginable? — Tzeentch

It’s not the most natural and it’s not the “default.” The very idea of self is a fairly recent invention. But I realize it’s been beaten into our heads so much that we take it as an unquestionable axiom.

we are all secretly selfish assholes — Tzeentch

Yes— the motto of Ayn Rand and other self-absorbed persons.

Incidentally, I’ve never advocated for the state. In the long run I hope states are dissolved. So the idea that reaction against sociopathy is advocating states is, as you say, complete projection.

You gave the example of Mao and communists China. Can you offer a similar example for individualism or is what you’re talking about merely theoretical? — praxis

It’s just dressed up Ayn Rand — i.e., an excuse to be a selfish asshole. That’s the “theory.” Just look at the results of this sociopathic ideology: vote for Trump, be an apologist for insurrectionists, defend corporate tyranny to the bitter end, advocate for neoliberalism, etc.

So don’t expect much coherence.

:lol:

think I'm resistant to the notion of responsibility really applying. — Moliere

Well choose a better word then. If the blame cannot be placed on the board of directors of multinational corporations, because our governments structure how business is conducted, then the state is ultimately the culprit.

I don’t completely agree with this picture, but if this isn’t what you’re saying I really don’t see what your point is.

“We’re all responsible” isn’t saying much, however true that may be. Can’t we say that about any problem whatsoever? The war in Iraq…we all share blame. The Challenger explosion? We all share some responsibility. Etc. Fine — but let’s narrow it down a bit.

Individualism demands that you be a selfish asshole who doesn’t give a damn about the world outside the self.

See Britannica.

I am merely noticing that throughout this thread you
1. Advocate the reversal of global warming by suppressing those activities that contribute to global warming.
2. Advocate that the workers be paid more than what's enough to eat, pay for healthcare and live. — god must be atheist

I haven’t advocated for either on this thread.

Basically, I'd say that the structure of property over-rides any commitment a shareholder may have. They may look like they have power, but I'd say it's ephemeral. — Moliere

So you’re placing most of the responsibility on the state, yes?

I think possibly the counterargument being made here is that the distribution of profits doesn't have a moral component - in other words, there's no answer to "how ought the profits be distributed?" — Isaac

Why? It’s like arguing there’s no answer to how we cut a pie. It depends on many things, and there’s not one ultimate answer that applies in all cases, but there are answers to be had.

I’ll be clearer: I don’t think distributing 90% of profits to shareholders is fair, and I don’t think the undemocratic decision making process that leads to that distribution is fair either.

In all kinds of cases. — ssu

No— not the parts I quoted.

Millions of businesses are not incorporated and don’t issue shares. I’m not sure where the confusion lies here but my statement isn’t controversial. If you think it is, you’re misunderstanding.

f this is truly the state of things, the question becomes: is it just? Has it always been this way?
— Mikie
I think you are confusing two things here. — ssu

I’m talking about multinational corporations and how they allocate profits. I’m not sure what you’re talking about now.

“Collectivism demands that the individual subordinates himself to a group”

So another thread based on delusional assumptions. Sweet. :up:

and (2) are decided by class, I think. — Moliere

I think so too: Namely, the “class” of owners. The capitalists, really. Today that’s mostly owners of particular property, like stocks. But I could be wrong.

Likely those people who own the property — ssu

those who buy the stock then decide what to do with the profits — ssu

In terms of large corporations, this seems to be the case.

But then they vote basically to give the profits to…themselves! What a shocker. So roughly 90% of the net earnings go back up the shareholders in the form of dividends and buybacks. Those decisions are made by the board of directors, who are voted in by the shareholders.

If this is truly the state of things, the question becomes: is it just? Has it always been this way? Etc.

Mikie actually knows this, but somehow cannot integrate it into his economic understanding. — unenlightened

Integrate what? This:

100 people who contribute to producing something automatically incur a debt to the rest of the world for the value of the resources they have appropriated to themselves, and the damage they have caused to other resources, ie the environment. — unenlightened

Well yes, no kidding. Does this really need to be stated? The “100 people produce something” is a casual example to get the discussion going. To object to this part of the OP completely misses the point, which really concerns the distribution of profits. Anyone who’s read a word of what I’ve wrote here for years knows that I don’t think production or private ownership occurs in a vacuum. I’ve also written often about “externalities” — especially environmental degradation. So I was, and still am, at a loss regarding your response.

Why not simply answer the questions?

If you think the problem you're describing is new (50 years old) then you're ignoring a lot of history. — Benkei

I’m not sure you’re understanding what I consider a problem. I’m not saying shareholders don’t want to make money. Shareholder primacy theory is indeed fairly new, and began being adopted and implemented in the 1970s and 80s. Part of this is the assumption about a typical shareholder that you mentioned, which echoes Friedman.

Perhaps the biggest flaw in the shareholder value myth is its fundamentally mistaken idea about who shareholders “really are.” It assumes that all shareholders are the same and all they care about is whats happening to the company’s stock price — actually all they care about is what’s happening to the stock tomorrow, not even 5 or 10 years from now.

Shareholders are people. They have many different interests. They’re not all the same. One of the biggest differences is short term and long term investing. Most people who invest in the stock market are investing for retirement, or perhaps college tuition or some other long term project. — Lynn Stout

https://youtu.be/k1jdJFrG6NY

Take a cue or don't but I'm done. It's fucking annoying talking to someone who only thinks he knows a lot about economics. — Benkei

I don’t think that. I mentioned before there’s good scholarship on all of this. Maybe we’ve read different things. Honestly I think it’s just misunderstanding— which is my fault, as I tried to be clear and failed. Not sure the abrupt frustration is warranted, but so be it.

He always said the workers thought it was great and management did whatever they could to throw monkey wrenches in the machinery. He always saw it not as a way to help the workers, but rather as a way to improve the productivity of the whole enterprise. — T Clark

I’m sure he’s right. There’s a lot of good scholarship on the era between roughly 1945-1975, when unions were stronger and distribution more equitable. Turns out this was good for companies as well.

Really? What do you think his surplus value extraction was all about? Not about profit? — Benkei

What does that have to do with shareholder motivation? They’re in it to make money, yes. The motivation is not to make money at the expense of everything else — that doesn’t make sense from an investment point of view. Any asset manager will tell you this.

It’s a strange question because wages are decided and agreed upon before the worker makes a single product. — NOS4A2

Not sure why it's strange. The question in this case is how that number is decided, and by whom.

These wages are determined by the market — NOS4A2

See above.

CEO makes 20 times an average worker in 1968.
CEO makes 350 times an average worker in 2022.

"The market" is an abstraction which explains nothing. The question is about real people. Prices and wages are decided upon by people.

Even so, the profit should not go towards this or that worker, but towards the business at large, because the business is providing income to everyone involved. — NOS4A2

The "business at large" is meaningless. The profits go somewhere. They're reinvested in workers, equipment, R&D, etc., or they're given to shareholders in dividends. These choices are made by real people.

I gave criteria for determining the answers to the OP questions. You seem to think my answers aren't responsive to your questions. I don't see why. — T Clark

You did, I just think they were too abstract and wonder if we could get into more detail about how that would potentially look in real life.

I think workers deserve a decent life for themselves and their families. We can have a discussion as to what is required for a decent life. — T Clark

I share that thought. I think it includes wages and other material conditions, but also decision making participation. That's basically my whole argument.

I don't think Marx was so prescient he wrote about problems that didn't exist until 100 years later. — Benkei

I don't recall Marx claiming that shareholders care solely about profit at the expense of everything else?

Maybe we're speaking past each other. To be clear: in my view, a shareholder cares more than simply profit above all else. In the long term, he's looking to make a profit, yes. But in the short term, he should care about the company itself, the community, the environment, potential corruption, mismanagement, the treatment of the workers. He should care about the company's longevity and quality control. Not just what the stock is doing today or tomorrow. And many shareholders do exactly this -- because they're long-term investors.

It's true that shareholders exist who want nothing but a profit in the short term, regardless of how they get it. Hedge funds are often good examples of this. Fire the workers, cut corners, bleed the company dry, then take the profit and leave. But to take this and generalize to all is a leap that isn't justified. It's like basing our view of human motivation on the behavior of a psychopath -- who make up less than 1% of the population.

I don't understand your objection to "the market". An analogy - I say the electorate selected Biden as president. You say the electorate had nothing to do with it, it was real people. Of course it was real people, and the collection of people who did the voting within the system, I am referring to as the electorate. Both are correct. — PhilosophyRunner

That's a fair point. My objection is a matter of emphasis. If we attribute Biden getting elected to the "electorate," that's true but it's far more abstract than it needs to be, especially if the question is something like "what reasons do people give for choosing Biden?"

There's also the question about whether you're definition of markets is accurate. I'm not sure it is. A market can also referred to a place -- or space -- where transactions occur. Where things are traded, sold, bought, etc. If I go down to the market to buy things, for example, I'm not referring to people but a general space where economic activity occurs.

So briefly, I think it's often used to avoid more concrete discussions. Not by you, necessarily, but by those in power.

A company decided to pay all of their staff the same amount - £36,000. This included software developers and clerical workers.

What happened? They struggled to hire software developers because other companies were willing to pay a lot more for this job (i.e they were paying below market value for the job - but I will only use the word in brackets for you). Equally they were inundated and overwhelmed with applications for clerical jobs because other companies were paying a lot less (i.e they were paying above market value for the job). — PhilosophyRunner

A good example. What my focus here would be is on who decided to give everyone an equal wage and why. Seems silly to me, but I'd be interested in the thought process behind it.

So there's no mystery: what I'm advocating for, ultimately, is not having these decisions exclusively be in the hands a tiny group. I'm not in favor of plutocracy in government, and I assume no one else here is either. I'm not in favor of it in business either.

Causes of global warming: many people using many resources.

(1) Deforestation.

Farming (palm oil, soy)
Livestock (cows, pigs, chickens)
Development (housing, roads, mining, businesses)

(2) Energy.

Oil
Natural gas
Coal

Burned to produce energy for:
Electricity
Transportation
Heat
Industry (steel, plastics, concrete)
Agriculture

-----

Little synopsis I found recently. Sums is up quickly.

I don't care how much profit companies make. how much executives are paid, or how it is determined as long as workers are paid a decent living wage. — T Clark

That's not quite the topic. Regardless, to pursue it: workers aren't being paid a decent wage, in reality. And the reason they're not is partly determined by these OP questions -- namely, how profits are distributed and who makes the decisions. The decisions certainly aren't being made by workers.

But let's assume they are being paid a decent wage. They get enough to eat and live and have healthcare. Is that it? They deserve only that? What if they're the ones doing the lion's share of the work? Don't they deserve more than simply a "decent living wage"?

I would suggest they deserve some say in the decision making, regardless of material conditions.

"The Market" is simply saying the aggregate of the above instead of listing them all out one by one, nothing more nothing less. — PhilosophyRunner

And has nothing to do with how those individual decisions are made. So the "market", back in the 50s and 60s, determined that the average CEO deserved 20 times what the average worker made. Now, lo and behold, the market determines that that number is 350 times.

It's an abstraction used to cover real decisions based on flimsy reasoning. It doesn't matter that most companies don't pay a living wage, and hence that the median income in the US is $32,000 or so. What matters is why so many companies are screwing their workers -- when in the past they haven't.

"The market" is a convenient fall guy.

Says 200 years of reinforced economic theory (market economics) married now successfully to neoliberalism aka "culture". — Benkei

I agree, except for the 200 years part. More like 50 years. I attribute that assumption (regarding shareholders) mostly to Milton Friedman, incidentally. But it's clearly wrong, factually and morally.

Yes this is how it works.

Not how I would like it to work though, but how it works. — PhilosophyRunner

Kind of. Minus talk about markets, anyway -- which is usually used as an abstract cover for real people making real decisions, usually for unjustified reasons.

Again, the question was "what should," not "what is." — T Clark

So the market *should* decide?

Sounds like you were claiming that markets do decide -- which, incidentally, is what most companies will claim.

I don't think markets should determine, nor do I think they in fact determine, how profits are distributed.

I'm perfectly happy to let the amount of profit be determined by the market as long as workers are paid a decent living wage. — T Clark

There's the invoking of "markets" again. But do markets really decide what the CEO or the average worker makes or what prices are?

No.

Shareholders generally only want profit to the exclusion of all else. — Benkei

Says who?

That's defined in the statutes of the company and usually lies with the executive board members. But they are voted in by the shareholders, so any shareholder with sufficient voting rights will effectively decide on the board members, so board members are incentivised to make shareholders happy. — Benkei

You're exactly right, of course. This is the reality we live in. I'm asking about both how things should be run and how they actually run, so this is an important piece.

The board of directors makes most of the decisions, along with the CEO.

So who are the shareholders? Seems like if each shareholder gets a vote, it's a somewhat democratic system.

Each employee should be payed their market value. — PhilosophyRunner

What their market value is. — PhilosophyRunner

The people who put the capital in decide. — PhilosophyRunner

So the people who put int he capital decide the market value, both theirs and their employees?

Nice position to be in, yes? "My market value is 350 times more than my average employee's value."

Your question was what should it be, not what is it. — T Clark

Sure. So how much should that be? There are real life examples, so we can speculate in specifics as well. You offered a rather abstract formula.

In any case, who decides? Everyone? Just the guy (or persons) who put up the money? "Me" is a joke answer, I assume.

The guy who puts up the money gets:

[The money he put up] + [Risk of loss] + [Reasonable incentive to invest]

The other 99 get a salary or wage and benefits that allow living a decent life. — T Clark

How much of the profits does he get?

That’s the question. There is an answer in real life, which is decided by real people. The answer to this also directly affects the “decent life” part.

But if someone does or contributes more than the rest I think it is justified to give to such participant more proportion of the pie than the rest. — javi2541997

Sure. No question. The question is: who decides? What’s the process in deciding? And, importantly, what’s the number? How much should that person (or group) receive of the profits?

I think it should not be more than 49,99 %. — javi2541997

Or the individual with huge percentage could be abusive to others, etc... — javi2541997

Interesting.

In real life, does it play out like this? Who decides? I'm talking of course about business, particularly big business.

The participants in a voting system. 3/4 of the votes could be useful to reach the distribution of proportions among the members. — javi2541997

Hmm. A voting system within a company, you mean?

(3) Who decides (1) and (2)?
— Mikie

Those that have the power to do so. — ChatteringMonkey

Sure...and in our socioeconomic reality, who is that?

(3) Who decides (1) and (2)?
— Mikie

That depends on the economic and political system under which this enterprise is carried out. — Vera Mont

That's true. Let's narrow it down and say the a typical Fortune 500 multinational corporation.

But that's a question of fact. There's also a question of what's just, which I'm also interested in.

Who has made the investment? All 100 equally? The equipment, the capital, is owned equally by the 100?

Whose idea was the enterprise? Do all 100 have equal share on the property rights, if there were any? — ssu

Let's say only a handful of people own the property. I'm not assuming everyone is equal, I'm asking how distribution of profits is decided -- and by whom.

No.

100 people and the accumulated wisdom of 10,000 years of human civilisation and the accumulated capital of 7 billion years of evolving life all contribute to producing something. — unenlightened

100 people all contribute to producing something.

Try again.

:up:

Couple scenarios.

1) Person takes an entire set of silverware, with many valuable pieces, from a home after dinner. Owner finds out, asks for them back repeatedly, and eventually gets a warrant to get them back because the guest refuses.

2) Person takes a fork from dinner, realizes they did so before owner even knows, and returns it.

Quiz: Are these scenarios equivalent?

I’m betting that Trump cultists will fail the quiz.

https://www.nytimes.com/interactive/2023/climate/earth-hottest-years.html

Hottest years on record, the last 8 were.

And I think these low participation rates are the reason just why employers in the US can be so aggressive against unions. Have a large majority of the workforce unionized and it's politically totally different. — ssu

Yes indeed. Of course, there are higher rates in the 70s and yet they were still destroyed. So it’s also about how strong they are. Unbreakable solidarity is hard to come by.

:chin:

Spoke too soon. Bolsonaro cultists are now storming Brasilia.

The moronic Trump supporters‘ insurrection sure set a great precedent for the rest of the world.

They most certainly can, and I just went through how. Giving less than 90% of corporate profits to rich people, taxing corporations and wealthy Americans at a rate that was common in the 50s and 60s, and not spending 800 billion dollars annually on defense contractors — isn’t a crisis. The characterization that these actions would lead to a “crisis” is nonsense.
— Mikie

My emphasis is on what the actual political system can deliver. Not what it could theoretically deliver. — ssu

It’s not theoretical— it’s happened before. Not in another country, but in the United States.

It’s amazing to me that corporations NOT giving 90% of profits to shareholders is considered beyond the realm of what’s possible.

Nothing will change until there's a crisis. — ssu

True— which is why the workers need to cause a crisis. Through strikes in key industries. Only then will concessions be made.

Or they can rise up violently. Which may be necessary, I suppose.

Can you explain to me how any legislation is ever going to get passed seeing as anything the HFC don't want to veto will never get through the Democratic senate? — Baden

There’s nothing to explain. Legislation simply won’t be passed the next two years— beyond the most necessary bills, and even then not without some brinksmanship.

The basic problem is that the US simply cannot change course without a financial crisis. — ssu

They most certainly can, and I just went through how. Giving less than 90% of corporate profits to rich people, taxing corporations and wealthy Americans at a rate that was common in the 50s and 60s, and not spending 800 billion dollars annually on defense contractors — isn’t a crisis. The characterization that these actions would lead to a “crisis” is nonsense.

Well, this system has gone a long time without a crisis — ssu

There’s been plenty of crises with our current system. 2020, 2009, 2000, etc.

The crisis is that we have a level of wealth inequality not seen since the pyramids. Correct that and the rest follows— including all the hand-wringing about the national debt.