Economics Questions

Re: Before the Welfare State

Giant_Joe — Thu, 05 Aug 2010 19:35:44 GMT

Notably, none of that actually happened. In fact, banning child labor raised wages for adults, allowing ("social evils" such as) adults being able to support their own children without sending them off to work in factories. Increased wages also encouraged investment in capital - you know - "capitalism."

Child labor was banned because adults didn't want to compete with children for jobs. Real wages went up because worker productivity increased through captial and technology. That capital accumulation was realized by people (including children) working 12 hours a day.

A child + a man could get more work done than the man alone. Would barring the child from working increase economic productivity? Would it make it easier to accumulate capital? The fact of the matter is, increased productivity allowed the family to be able to afford children who didn't work. The labor laws thwarted the realization of this state of affairs. Capital accumulation and technological progress allowed us to realize the better state of affairs.

Saying that labor laws made things better for people in general is like saying that a law that made it illegal to drink cyanide kept them from drinking it.

Re: Before the Welfare State

Sieben — Thu, 05 Aug 2010 19:20:07 GMT

ravochol:
The masters’ spokesmen maintained that economic and social evils were bound to follow any attempt to interfere with the labour market. Shortened working hours could only result in the triumph of foreign competition, producing lower wages and unemployment.

I didn't say foreign labor markets would win. I said that if monopolies are the root cause of poor working conditions, nothing will ever get better if you don't break the monopoly. I.e. treat the cause, not the symptom. The extortionists will still be in power, albeit producing less goods and services.

ravochol:
Notably, none of that actually happened. In fact, banning child labor raised wages for adults, allowing ("social evils" such as) adults being able to support their own children without sending them off to work in factories.

Make with the evidence. This is empty lip service. Moreover, anything could happen on the market at any time. Its an empirical phenomenon with many different factors, most of them unknown. You have to default to theory in order to make sense of economic arrangements, otherwise you're left concluding that a decrease in the number of pirates at sea causes labor markets to strengthen... I would speculate that englands economy would continue to become more robust in spite of labor laws. Because I have theory.

ravochol:
Increased wages also encouraged investment in capital - you know - "capitalism."

Rothbard talks about how the minimum wage causes capital structures to over mechanize. Is capital investment good a priori? No. You have to make a cost benefit analysis on the market.

Re: Before the Welfare State

Sieben — Thu, 05 Aug 2010 19:13:13 GMT

You are the one making the assertion that 19th century england was laissez faire. The only evidence you offered is from a bleeding heart speech at a court trial. Thanks. We already know that leftist rhetoric exists.

In order to prove this is a free market failure you need to A) show the extent of which self ownership and homesteading were respected, and B) show that THESE RIGHTS lead to bad outcomes. You haven't done either.

It was childish of you to think you could dismiss free markets in one stroke. Thousands of people have studied history and economics their entire careers and come out in favor of free markets, communism/socialism, monarchy etc. You cannot destroy any political or economic system so easily. The proponents of all schools have sophisticated rebuttals ready for all points made regularly against them.

Re: Before the Welfare State

ravochol — Thu, 05 Aug 2010 19:09:02 GMT

so long as there is no alternative on the market, firms productivity will suffer under monopoly and there will be even greater poverty.

also from the book:

The masters’ spokesmen maintained that economic and social evils were bound to follow any attempt to interfere with the labour market. Shortened working hours could only result in the triumph of foreign competition, producing lower wages and unemployment.

Notably, none of that actually happened. In fact, banning child labor raised wages for adults, allowing ("social evils" such as) adults being able to support their own children without sending them off to work in factories. Increased wages also encouraged investment in capital - you know - "capitalism."

Re: Before the Welfare State

ravochol — Thu, 05 Aug 2010 19:02:38 GMT

"You can't reasonably use early 19th century England as an example of free markets."

Really? If they weren't free markets, then what was? Laissez faire was official policy at the time, especially early in the century.

Is your argument that "perfectly free" markets have never existed, and thus can never be criticized? That's just a cheap debating trick; the inverse would be to claim that "perfectly free" statism has never existed, and thus statism is only deficient because it's not extreme enough. It's equally nonsense in either case. There were less governmental restrictions on labor markets in early nineteenth century England than nearly anywhere else, ever. You're going to have to use historical evidence if you'd like to refute that.

Re: Before the Welfare State

mwalsh — Wed, 04 Aug 2010 18:15:11 GMT

I'd go with this:

http://mises.org/media.aspx?action=category&ID=203

Applying economics to America History, (also available through iTunes U), as he explains some of this.

Hear the audio, so missed some of the pictures/etc, also not sure where or if he cites this...

Re: Before the Welfare State

Laotzu del Zinn — Wed, 04 Aug 2010 18:04:09 GMT

"You can't reasonably use early 19th century England as an example of free markets."

I will keep that in mind the next time someone does use them as that example. lol

"statist restrictions"

Could you elaborate a littel futher?

Re: Before the Welfare State

Sieben — Wed, 04 Aug 2010 17:51:44 GMT

This is typical Rachael Maddow logic. Only trying to treat the symptoms and never the cause. If you treat the symptoms by introducing 10 hour working limit bill, you keep the existing monopolists in power. Even if you make it illegal for them to "extort" the worker, so long as there is no alternative on the market, firms productivity will suffer under monopoly and there will be even greater poverty.

After all, exploited coal miners are mining coal to keep other exploited workers warm... the fact that greedy capitalists have nominally 100x the wealth of the average person does not mean they consume 100x more of the same goods. I really honest analysis could indeed skip over the nominal specie economy and simply look at how goods are produced and distributed.

How much coal is being produced? How much of that coal is being distributed to which people?

And all the other simple holes in this logic:

Is this really a free market? I'm not familiar with early industrial british history...

Pessimistic anti market bias. Just because it is bad now does not mean working conditions will not improve on their own. See America 1850-1900.

Assuming regulators will automatically make the right regulations.

[edit: And Im just going to point out that given this speech was given as testimony before a political body. There is a high probability this is politically motivated. It also has no general statistics, so we can only know whatever cherry picked facts the author wants us to know. I can make socialism look reallly scary too if I only focus on the bad stuff :I]

Re: Before the Welfare State

krazy kaju — Wed, 04 Aug 2010 17:03:46 GMT

The OP does nothing to prove the need for a welfare state. If anything, it proves the need for a free market over a society with the kind of statist restrictions that create the setting for such abuses to happen. You can't reasonably use early 19th century England as an example of free markets.

Re: Before the Welfare State

Clayton — Wed, 04 Aug 2010 16:51:44 GMT

This testimony mistakes the symptom for the cause. The privations which spurred our primitive ancestors to devise new methods of production were far more severe than those described above. When a person sells his leisure time to an employer for wages, he is exchanging a present good (leisure) for a future good (more luxurious leisure). The only reason any human ever produced anything for himself, or sold his leisure time to an employer in order to produce something for another, was to improve the quality of his own life. It cannot be the case that children were enduring conditions in factories that were clearly worse than the consequences of forgoing employment (slightly reduced standard of living) because they would have chosen to simply forgo employment. The cause or causes lie elsewhere, this is only a symptom.

Clayton -

Re: Before the Welfare State

Sphairon — Wed, 04 Aug 2010 11:55:03 GMT

ravochol:
they selected testimonies to highlight some of the worst examples. And so what? The worst cases should be highlighted, they're terrible!

There are some really nasty car accidents every year. The Sadler committee appears to be the 19th century equivalent of showing non-stop video footage of disfigured car accident victims in Congress to make them ban cars.

Also, the context is evidenct from the testimonies - an environment where a factory owner can work a 9 year old child 12 hours a day, nonstop. THAT is not controversial - in fact, the only reason the "Ten Hour Bill" was controversial is because factory owners wanted to retain their "freedom" to employ "free labor" without government interference as to how old or how long.

You know, it's really easy for a 21st century person to speak contemptibly about the business practices of yore, but at the time, it was not uncommon for a 9-year-old to bear the responsibilities of an adult. This included working.

And certainly, not all was good at the time. But some of the stories about 19th century working conditions simply need to be revised. The one about malicious factory owners denying their workers the pleasure of a window, for example, when this was caused by a government tax on windows. Or stories about how evil industrialists chained underage workers to their benches when really, they chained them up to rest because they wouldn't stop working on their own (I think this was covered in Robert LeFevre's series on the Industrial Revolution).

And what's the benefit of a 10-hour-day when you need 12 or 13 hours of wages to make ends meet?

Re: Before the Welfare State

nirgrahamUK — Tue, 03 Aug 2010 19:50:42 GMT

con·done

[kuhn-dohn] Show IPA

–verb (used with object), -doned, -don·ing.

to disregard or overlook (something illegal, objectionable, orthe like).

to give tacit approval to: By his silence, he seemed tocondone their behavior.

Re: Before the Welfare State

Laotzu del Zinn — Tue, 03 Aug 2010 19:46:20 GMT

Yes. You are condoning it. You may not agree with it, but you condone its use. This is a semantic argument that doesn't break the original poster's idea. Perhaps he should have said "support" instead.

Re: Before the Welfare State

Solid_Choke — Tue, 03 Aug 2010 19:37:50 GMT

If you advocate doing nothing about something, and don't believe anything should be done about it, you are condoning it, regardless of whether you dislike it subjectively.

That would mean everyone that supports freedom of speech is condoning racist speech. Is that right?

Re: Before the Welfare State

Caley McKibbin — Tue, 03 Aug 2010 19:35:13 GMT

antonyms of condone: forbid, not allow, prevent

This feeble attempt to cherry-pick antonyms from a thesaurus to suit your sinister agenda only serves to cut your credibility as an honest fellow down to size.