Economics Questions

Re: Capitalism as the bogeyman - would Marxism lower prices?

GooPC — Fri, 10 Dec 2010 00:32:12 GMT

would Marxism lower prices?

In complete a Marxist economy there are no prices. All factors of production are owned by the state. There is only one producer (the state) and only one consumer (the state); therefore any prices set between them are completely arbitrary.

If you are buying anything then that implies private property exists, but remember what Marx said in The Manifesto:

In this sense, the theory of the Communists may be summed up in the single sentence: Abolition of private property.

Without prices, the economy will suffer from chronic inefficiencies and less wealth will be produced. Economic calculation problem.

Re: Capitalism as the bogeyman - would Marxism lower prices?

Isaac "Izzy" Marmolejo — Thu, 09 Dec 2010 20:15:34 GMT

you are absolutely right, but I was just answering the question under a Marxist point of view because OP wanted to know why Marxist blame capitalists for high prices.

Re: Capitalism as the bogeyman - would Marxism lower prices?

nuksukow — Thu, 09 Dec 2010 20:12:35 GMT

@Bram- In that case, it would seem that workers could afford more since they are now recieving the "full value" of their labor. Sounds liked wealth redistribution in a way. Eliminate the capitalist and reclaim the surplus value he has been exploiting you for. I don't understand how obtaining goods and services that require considerably greater skill to produce would work though. If the skilled labor of a doctor is worth 10 times as much as a man who digs ditches, what ensures that the ditch digger can afford the doctor's services? Does the doctor have to be exploited by the ditch digger and charge him substantially less?

I suppose I should just read a book on Marxism already.

Re: Capitalism as the bogeyman - would Marxism lower prices?

nuksukow — Thu, 09 Dec 2010 20:03:06 GMT

I'm also currently reading The Anti-Capitalist Mentality, so I'm sure I'll find some answers in there. I understand how Marx's exploitation theory is incorrect due to time preference, but I guess I'm looking for ways to respond to those who paint capitalism as evil for high prices, rather than what they consider to be low wages.

In regards to medical care, the only explanation I can offer (other than the ones I mentioned in my first post) is that most of these new drugs and new procedures wouldn't have come into existence without capitalism, and that capitalism will make them less expensive over time. I often find myself using the example of a calculator or cell phone.

Re: Capitalism as the bogeyman - would Marxism lower prices?

BramElias — Thu, 09 Dec 2010 13:25:40 GMT

I've recently read The Communist Manifesto for my philosophy major and the title made me want to respond. The question

is completely irrelevant because Marxists actually see low prices as something bad, because according to Marx

it would lead to lower wages and thus an even worse situation for the proletariat. We actually discussed it

at Political Philosophy and I just couldn't understand it. The claim that lower prices would lead to a worse

situation for the working class is a bit bizarre to me.

Re: Capitalism as the bogeyman - would Marxism lower prices?

Vitor — Thu, 09 Dec 2010 13:18:02 GMT

Isaac, capitalits are not self-aware of what theory of value they use, they don't chose SVT over LVT on purpose. SVT trumps LVT simply because it's the one that the reality of human action.

If they tried to guide their business by strict following LVT, it would be economically unsound. Still, a lot of businessmen and people in general believe in LVT in some level. For example, if a product has more features, many people would agree it's more expensive because the maker had to "put more work on it".

Of course any decent economist will say that those features are subjectively valued and not some random features to make the product "full of work" and highly valued.

Re: Capitalism as the bogeyman - would Marxism lower prices?

Isaac "Izzy" Marmolejo — Thu, 09 Dec 2010 11:18:39 GMT

according to Marxism, capitalists start businesses to make a profit, and profit is something Marxists are against. Marxists prefer to measure the value of something equal to the amount of labor put into it, therefore there is no profit achieved.

capitalists dont use this theory of value because they are in business for profit. the marxists would then blame the high prices on the capitalist's greed for profit...

Re: Capitalism as the bogeyman - would Marxism lower prices?

James — Thu, 09 Dec 2010 10:53:33 GMT

In the Marxist future, would everyone have the exact same, complete health care?

Of course. That's the point of Marxism. Everyone would have to queue for five weeks to see a general practitioner.

Except for the enlightened shepherds of the new communist order, of course... They'd need to have their own Party doctors, to help them accomplish the most important work in the world.

Re: Capitalism as the bogeyman - would Marxism lower prices?

nuksukow — Thu, 09 Dec 2010 09:40:23 GMT

I justed started into Mises' Socialism. I think I already halfway know and understand the answer to this (i.e. they can't be), but allow me to get back to you in a month.

Re: Capitalism as the bogeyman - would Marxism lower prices?

William — Thu, 09 Dec 2010 09:33:32 GMT

How are any of these prices rationally determined?

Capitalism as the bogeyman - would Marxism lower prices?

nuksukow — Thu, 09 Dec 2010 09:12:31 GMT

*Let preface this by saying I have very limited knowledge when it comes to Marx. I've listened to a few lectures on Marx from Hoppe, Rothbard, Salerno, etc. I've only been studying the Austrian school since late summer. *

Many people I know I seem to blame capitalism for what they see as high prices. Luxury items do not bother them, but of course health care is a hot button issue. Now, in my mind, health care costs are "high" for a variety of reasons: protectionism/restricted competition, over regulation, government monopoly on licensure, the cost of new technology, etc.

Given that health care is an extremley emotional issue, I understand the use of capitalism as a bogeyman. I am curious as to what the alternative would be in their minds though? From what I know about Marxism, capitalism is villifed not for its prices, but for the alleged exploitation of laborers by capitalists who owns the means of production. Didn't Marx believe that workers should earn the value of the final product they created, rather than being "exploited"? From my limited knowledge, it doesn't sound like Marx necessarily believed that products were overpriced, but that workers were underpaid for their labor.

So I'm just curious if it is really fair or logical, from a Marxist perspective, to blame the cost of health care on the "greedy" capitalist?

Does Marxism ultimately arrive in world of complete equals? In the Marxist future, would everyone have the exact same, complete health care?

*I apologize for the meandering nature of this questions. I've had a couple beers haha.*