Economics Questions

Re: have any good sources on cooperatives?

hkarnoldson — Wed, 27 Jan 2010 04:45:54 GMT

Leviathan:

krazy kaju:

If worker coops were as amazingly productive and efficient as you claim them to be, one would expect them to be the prevalent form of economic organization in this country. That's the real empirical evidence.

Well, no...the market utopianist would. The person who realizes the concentrative effects of market power would realize the shallow nature of such a claim, as I explored in my first post on the forum. It's curious, because I've become quite accustomed to the junior Misesians across the Net rejecting every single study in existence because of their insistence that the inability of social science to completely isolate all variables renders them all useless. It's certainly a shift to find someone claiming that raw data without any controls whatsoever proves anything, though if it lines up with your preconceived ideological biases, I can see why it would be tempting.

Ehm, if the workers wanted to buy all the the corporations they could do so in like 25 years. (I think that is a calculation from the 80s found in the Machinery of Freedom.)

Still now corporate profits are like 3% of the economy, it is very small.

The real question here has is:
Do the workers want to own capital?
No, they don't. They wouldn't be poor workers if they wanted to own corporations.
If that is what they wanted they would be saving rather then spending everything they earn.
But they think that having fun today is more agreeable then saving for the future, so they consume.

Anyone with any kind of a job in any western country should be able to save money, and a good portion of there wage too.

Just taking my own economy as an example:

- I am a full time student.
- I work weekends cleaning trains (about as bad as a job gets).
- I pay the highest taxes in the west. Swedish taxes....
- I live in a decent place in down-town Gothenburg .. which is the second largest city in the country so the second most expensive place to live in the country.
- I can afford to go to many college events and parites.

And I still manage to save almost 100 Euros per month.

When I work full time during the summer could easily save 400-500 EUR per month and still increase my standard of living from how it is during the semesters. If you have any brains you should manage at least a 25% return per year on that.
(Pension savings etc isn't calculated in that cause that is already forced by the government on top of that amount.)

Unless they are in the 15-20 years of there adult life when they have kids and stuff there is no reason what so ever for workers to not to be saving money.

Workers have a choice and they choose to spend to there money rather then become capitalists.

This has nothing to do with "concentrative effects of market power"

Workers choosing not to save at all is the primary reason there are so few large coops.
The few workers that do save some money tend to avoid risk. To start a coop they would put almost all there savings into one extremely risky asset (new companies are very risky). This is complete insanity, even to the most highest risk seeking investors out there ... and workers seek low risk.

Re: have any good sources on cooperatives?

Jon Irenicus — Wed, 27 Jan 2010 04:40:45 GMT

But I am sympathetic to left-libertarians like Roderick Long who would like to see a greater variety of organisations and types of employment.

Ditto. However, they neither involve central planning nor some fantastic notion that capitalist firms (as in those engaging in division between capital owners/entrepreneurs and "workers") will disappear or even should be banned (the latter utterly disqualifying one from being an anarchist.)

Re: have any good sources on cooperatives?

fakename — Wed, 27 Jan 2010 04:26:20 GMT

Leviathan,

I think that just because something is more productive doesn't necessarily mean that it is the best economic system. Take the sushi economy example where the islanders discover and use a motorboat to cash extra fish and expand output. The problem is that the villagers don't have sufficient capital to maintain the motorboat and their other tools so something has to give and this is usually seen in an economic downturn and increasing unemployment.

OF course it is possible for output to rise in the interim but your preference for more consumption now is, like everything else, subjective and depends on purposes.

So in the example the motorboat would be the cooperatives.

Re: have any good sources on cooperatives?

Jon Irenicus — Wed, 27 Jan 2010 04:00:48 GMT

Returning to reality,

You should.

control of larger market shares often does not necessarily reflect efficiency or this greater capability so much as previously existing concentration.

It does if it is through consumer preference that the firm attains such a position.

Market power

Meaningless drivel.

skews affairs so that those with the greatest amount of resources to draw on remain established firms, with this constituting a barrier to entry for small firms regardless of their efficiency.

If the firm is enjoying high profits, it will attract competitors willing to supervene said "barriers" - either existing well capitalised firms or upstarts. The exception is firms which enjoy legal protection and thus have market share solely because of the state slanting matters in their favour. Existing resources are absolutely no guarantee a firm will retain its share, and competition is making it ever harder for firms to entertain such stupid notions.

Personally I doubt more 'hierarchical' firms will predominate in market anarchism as they will suffer increasing inefficiencies, but this will not hold for all markets, where in some cases such firms will better serve consumers. This is a non-issue to me... There's always exceptions like that Brazilian 'worker'-owned firm, though of course based on details I've read its divergence from the stereotypical capitalist firm is not huge. Merely broader dispersion of share ownership by employees of the firm.

Re: have any good sources on cooperatives?

Austro-Devil — Wed, 27 Jan 2010 01:23:35 GMT

krazy kaju:

If worker coops were as amazingly productive and efficient as you claim them to be, one would expect them to be the prevalent form of economic organization in this country. That's the real empirical evidence.

There is some truth to this. But worker co-operatives face many barriers. Workers do not have many assets, so they have to borrow. But they may not even have enough assets for collateral. If they do, they will likely face high interest rates. Burczak discusses this in Socialism after Hayek. I do not share Burczak's optimism about the desirability or feasibility of deviations from laissez-faire. But I am sympathetic to left-libertarians like Roderick Long who would like to see a greater variety of organisations and types of employment.

Consider this: If capitalism, or laissez-faire, the market economy, voluntarism, market anarchy etc. were as efficient as we Austrians think, one would expect them to be the prevalent form of economic organization in this country. Yet interventionism-corporatism-mercantilism appears to have proven its superiority. Of course, we don't believe this. There is an important distinction between an institution or economic system being able to break through existing arrangements, and being efficient enough to continue to exist. The former is usually much more difficult.

Re: have any good sources on cooperatives?

E. R. Olovetto — Wed, 27 Jan 2010 01:11:11 GMT

Leviathan:

E. R. Olovetto:
Translation = robbery, correct?

An antidote to robbery, actually, since currently existing property distribution is based in theft. Since effectively all property in industrialized society was acquired by force, coercion, or fraud or created through the utilization of productive resources that were acquired through force, coercion, or fraud, why do you have any interest in defending the present distribution of wealth and resources, stepchild of a phase of primitive accumulation that it is?

You didn't answer my question about what you actually advocate. Anarcho-communism? State socialism? Property = theft, in your opinion? If I want to run a business with privately held shares and not really make them available to the laborers I employ, do you advocate taking my things being a justifiable punishment for an evil capitalist? Most people normally call that robbery, not an antidote to it.

I think that we owe the good of the industrial and technological revolutions to actual capitalism, voluntary exchange, and the bad to state intervention. I have a problem with the distribution of wealth as well, but only from the factor of institutionalized violence and state coercion. We totally support setting that right. Voluntary association and free trade is not the problem.

Leviathan:

E. R. Olovetto:
Voluntarism allows people to form collectives all they want. It doesn't allow forced income redistribution and murdering scab workers. What is your objection to allowing people to form businesses or be a non-owner employee if they want?

There aren't any. I simply share the common libertarian/anarchist belief that firm organization will not be inclined toward hierarchy due to the inefficiency and authoritarianism of that arrangement.

Libertarianism says nothing about economics. I've seen you try to hijack the word (don't respond about this as I could care less). I guess you are just conflating things again, like actual capitalism and mercantilism-"capitalism".

I don't suspect people would voluntarily give up the modern conveniences we owe to capitalism and return the primitive barter society that would be the result of anarcho-communism being followed completely.

Re: have any good sources on cooperatives?

Felipe — Wed, 27 Jan 2010 00:29:19 GMT

Leviathan:
An antidote to robbery, actually, since currently existing property distribution is based in theft. Since effectively all property in industrialized society was acquired by force, coercion, or fraud or created through the utilization of productive resources that were acquired through force, coercion, or fraud

How so? Are you blaming people that lives today for an alleged "coercion and fraud" that happened centuries ago?

Re: have any good sources on cooperatives?

Jonathan M. F. Catalán — Tue, 26 Jan 2010 23:59:39 GMT

Esuric:

Conflating terminology in order to concede a point to someone entirely confused cannot, in anyway, be considered "reasonable."

I didn't conflate any terminology. You just did not take what I wrote into the context of the post, and/or decide to split hairs. What I wrote was, within the context, correct, and in line with what you would eventually respond to Leviathan. Capitalism, in the purest sense (or capitalism without the distortions caused by intervention), has never existed within the time frame of written history. You may have misinterpreted it as something else, but that was through no fault of my own (and, I'm not sure why you would misinterpret it, or what motivation you had to misinterpret it).

But again, I don't want to get into a debate about debating.

Nobody is forcing you to.

I've answered all of your questions, can I go now?

What does this even mean? What do you hope to gain by posting sentences/questions such as these? Are you taking this as a lecture (which it is not)? If anything, it comes off as an attempt to belittle. If you really don't care for what I have to say, then why not say that? You responded to Leviathan that a productive debate had to have lucid language, but you are giving everything but lucid language.

Re: have any good sources on cooperatives?

Esuric — Tue, 26 Jan 2010 23:54:24 GMT

Jonathan M. F. Catalán:
Because, I have experience debating with people that disagree with me, and those people have told me that they close their minds when you question their intelligence, because they no longer perceive you as reasonable. And, given that I would feel the same way, I can sympathize. I'm sure a debate class would tell you the same thing.

Conflating terminology in order to concede a point to someone who's entirely confused cannot, in anyway, be considered "reasonable." But again, I don't want to get into a debate about debating. Also, no one has questioned his intelligence, just the validity of his arguments. I've answered all of your questions, can I go now?

Re: have any good sources on cooperatives?

Jonathan M. F. Catalán — Tue, 26 Jan 2010 23:47:40 GMT

Esuric:

I said if.

I'm not sure how you could misinterpret that post you quoted as an attempt on my part to tell you to "not speak unless spoken too", but that was not the intention at all. I was stating my position that what you quoted had nothing to do with what you said, and then later extended my position to include the fact that you were splitting hairs for no apparent purpose other than to discredit the post (and, I'm not sure for what reason).

What I said wasn't directed to you...

This had to be clarified, as the response was directed at Leviathan, and so was written within the context of Leviathan's post (which I quoted) and within the context of what I was trying to say to Leviathan.

You could go down this route. I don't see why you would, but okay.

Because, I have experience debating with people that disagree with me, and those people have told me that they close their minds when you question their intelligence, because they no longer perceive you as reasonable. And, given that I would feel the same way, I can sympathize. I'm sure a debate class would tell you the same thing.

Re: have any good sources on cooperatives?

Esuric — Tue, 26 Jan 2010 23:40:31 GMT

Jonathan M. F. Catalán:

Esuric:

Wonderful. My comments were extremely clear, and I explained why I chose to respond to you. If you think you can control what people say on this forum, or that you have the right to put in place some "don't speak unless spoken to" decree, then you're sadly mistaken.

That's not what I said at all, Ensuric. Please, stop straw manning me.

Jonathan M. F. Catalán:
What I said wasn't directed to you, or really had anything to do with what you said.

I said if.

Jonathan M. F. Catalán:
I am not conceding any point to Leviathan

Jonathan M. F. Catalán:
It's a debate tactic; you make minor concessions to give them an incentive to continue reading what you have to say)

You could go down this route. I don't see why you would, but okay. Again, this is why I responded to you, if you must know.

Re: have any good sources on cooperatives?

Jonathan M. F. Catalán — Tue, 26 Jan 2010 23:36:36 GMT

Esuric:

Wonderful. My comments were extremely clear, and I explained why I chose to respond to you. If you think you can control what people say on this forum, or that you have the right to put in place some "don't speak unless spoken to" decree, then you're sadly mistaken.

That's not what I said at all, Ensuric. Please, stop straw manning me.

Re: have any good sources on cooperatives?

Jonathan M. F. Catalán — Tue, 26 Jan 2010 23:35:42 GMT

Stranger:

So this is a cooperative of capital owners? Are the farm laborers members of farming cooperatives?

I can only speak from my own experience as a farmer in Castilla-La Mancha (well, my family are the farmers, but since I've lived there and helped them working on the land I have a decent idea of what is going on), and so I don't know if there are communal farming societies in Spain. The farmers, themselves, are private land owners, and we work for our own profit. Then, you have to sell your harvest to processing centers (i.e. wineries, oil presses, et cetera). There are cooperative and "private" processing centers.

The difference is not in the way that it's organized, just the way that it was founded. Let's say that at the beginning of time there was a private winery, and farmers thought that the owners took too much of a profit from the farmers' grapes. So, the farmers, lacking enough capital on an individual basis to build a winery of their own, decide to unite capital and distribute ownership between the providers of said capital. The result is a cooperative. Individual farmers who did not contribute capital can apply for membership, but it sometimes works the same with "private" companies (in the end, they are all private). The membership is pretty much like a Costco card; you get perks.

The difference might be that the cooperatives are subsidized (I am not completely sure), so what the cooperative can offer you is sometimes better than what a private processing center can. My family belongs to a wine cooperative, but until this year (I'm not sure if we switched; I moved out of Spain, so I am no longer up to speed) we sold our olives to a private olive press.

I guess there are "communal" incentives to form be a member in the cooperative. The wine is not the cooperative, but is "yours" (all contributing farmers can claim that the wine is theirs), and this wouldn't be true with a private firm. I guess that is a form of intellectual property (well, not really, but you get what I'm saying). But, at least our wine cooperative resembles more of a private enterprise, than anything communal.

Re: have any good sources on cooperatives?

Esuric — Tue, 26 Jan 2010 23:28:37 GMT

Jonathan M. F. Catalán:
To be honest, I have no idea what you're on about.

Wonderful. My comments were extremely clear, and I explained why I chose to respond to you. If you think you can control what people say on this forum, or that you have the right to put in place some "don't speak unless spoken to" decree, then you're sadly mistaken.

Angurse:
You should read Socialism After Hayek its a trip! While accepting many of Hayek's arguments the author makes his Marxist ideals painfully clear. He never really counters Hayek's "Knowledge Problem." And with his solution of worker-owned democratically-controlled firms basically ignores all the problems associated with them (such as those put forth by Klein and Prychitko).

Thanks, that sounds hysterical.

Re: have any good sources on cooperatives?

Angurse — Tue, 26 Jan 2010 23:27:43 GMT

Esuric:

It's extremely satisfying to see that Mises and Hayek's arguments from the late 20s has forced pseudo-socialists into this very curious position. There is no economic doctrine supporting your claims, and you're forced to retreat from Marx, Sraffa et al. It's wonderful really.

You should read Socialism After Hayek its a trip! While accepting many of Hayek's arguments the author makes his Marxist ideals painfully clear. He never really counters Hayek's "Knowledge Problem." And with his solution of worker-owned democratically-controlled firms basically ignores all the problems associated with them (such as those put forth by Klein and Prychitko).