Another link
Dec. 8th, 2004 02:29 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
pecuniumLiberal Tough Guy dotcom
Forget the picture of the Quad .50 (which is cool, in a gun-geek kind of way) and read the text.
I've no beef with social Liberalism but economic Liberalism is True Liberalism and must come first. I'll put it to ya like this: what some Mexican-American janitor needs is to be paid $25 an hour, not to have bi-lingual education for his kids or a translator at the Secretary of State's office. Get the money and the rest will follow.
There is a lot of truth to that.
Forget the picture of the Quad .50 (which is cool, in a gun-geek kind of way) and read the text.
I've no beef with social Liberalism but economic Liberalism is True Liberalism and must come first. I'll put it to ya like this: what some Mexican-American janitor needs is to be paid $25 an hour, not to have bi-lingual education for his kids or a translator at the Secretary of State's office. Get the money and the rest will follow.
There is a lot of truth to that.
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no subject
Date: 2004-12-10 02:59 am (UTC)And what is taking from the janitor, in this case, in the form of labor, and keeping that for the shareholder, but a form of redistrinbution?
Ok, Economics 101.
The janitor and the company (i.e. shareholders) enter into a voluntary contact, according to which janitor exchanges some of his time and efforts to some amount of money.
If any of those parties thought that the exchange does not benefit them, they wouldn't enter into the contract (remember, that is voluntary). Therefore, the exchange benefits both.
If janitor is thinking he's underpaid, he can leave the job and seek another employer, willing to pay more. If there are no such employers, then he, obviously, overestimates the value of his work.
Similarly, an employer cannot arbitrarily depress the offered compensation - or nobody'll be willing to sweep the floors. The salary (in the absense of the government regulation) is determined by the balance of supply and demand. The added benefit resulting from the exchange will generally be distributed equally (this is, essentially, the profit - and the norm of profits tends to equalize in the long run).
All voluntary contracts are Pareto-superior, meaning that they cannot decrease welfare of any party. Therefore, they can only increase the overall welfare of the society.
The non-voluntary transactions of any kind (meaning taxation or other form of regulatory-imposed redistribution) are, by definition, reducing welfare of some paries. Therefore, they cannot be guaranteed to be Pareto-superior, and, in fact, are always inferior to the voluntary contracts, thus reducing the wellbeing of the society as a whole.
The "labour" theory of value (as implied in your statement) is pretty much meaningless, unless one is willing to stipulate that all kinds of labour are equally productive. Which is pretty much what socialists did - so they paid people willing to spend years on education and doing "easy, clean work" less than unskilled laborers. Which made "an engineer" a derogatory word and explains why the ex-Soviet Union is such a hotbed of technology and innovation, not to mention its enormous economical prowess.
(Don't let the "success" of space and nuke programs to mislead you into thinking that Soviet system is somehow adequate - engineers and scientists involved had a quite powerful non-economical stimulus to deliver (or be shot). These Soviet programs were supervised by NKVD (the old name of KGB), and most "employees" were political prisoners. In the later years the "incentives" became somewhat softer, like staying off the black lists of unemployable, and with that softness the performance, correspondingly, collapsed).