European News and Poland Thread 2

Not if you are a Bolshevik. Then the profits belong to the workers or the party.
Things get less clear in crony capitalism where the ruling class plays favorites with subsidies - another form of theft from the less connected.

Yes, crony capitalism is a big problem; but, it's not theft. It's more oligopoly-not good for a free market.

I'm interested in knowing why cojest... thinks transferring profits is a suspect practice.

Legally. In every other way, it is theft as it causes money to leave your pocket as a taxpayer and end up in the pockets of the well-connected. When the project goes bust, the ruling mob just writes it off. If the project makes gold, the gold stays with the well-connected minus another campaign contribution. This is how bribery was made legal.

In crony capitalism, the scam is simple: Profits are private. Losses - public. Lovely.

If the company has raised credit and used that money to reward their shareholders while the company is indebted and is keeping wages low, then yes, morally it is theft from the workers.

No, it's not. There is no such thing as "low wages". Wages are what the two parties agreed on.

Theft is when wages are controlled by the government as was the case in the USSR and Poland and is now in the US where the ruling mob forces the minimum wage on the employer as well as the worker who would rather be employed at 14 than unemployed at 15.

The market response: machines. As pawian would say...hahahahahahaha...

Bye, Mr. Worker...Go to your friendly unemployment office...

Can a 'free market' be either good or free?

@jon357

I don't understand how that relates to my question of why transferring profits of a foreign company back to its home country is a suspect practice.

But, taking your scenario at face-value, how does that constitute theft from the workers? The company is borrowing money (probably because retained earnings are low), they are not raiding accounts set-aside to pay employees.

In the real world, this practice may actually be an indirect benefit to the employee in that it may keep the company from losing value by investors selling off due to missed dividends payments. Also, when this type of thing happens quite often it's because a company is growing too rapidly that it doesn't have the type of positive cashflow it needs (e.g., large accounts receivables, to meet the growth it needs to spend capital on plant and equipment, increase in the pay rolls,etc.) and/or revenues are socked away in tax-shelters (which are legit and legal, but not readily available to pay dividends). Notice, in both instances the workers still get paid what they are owed. They are not being stolen from.

The argument of whether workers are paid low wages is legitimate, but something all together different than what's been mentioned above.

Borrowing money and indebting a company.


A lot of attempts to justify a much criticised American practice which is pretty well unrestrained capitalism.


Though rarely what they are due, i.e. the full fruits of their labour.

You are debating a Marxist. Their credo: profits are either "obscene" or belong to the workers. You know, sweat and blood...

Almost forgot, and no risk. All risks must be left for the blood-sucking investors, those evil monsters who build factories that make products people actually want.

Yeah....well....the historical alternatives didn't work!

If you allow the government to prevent this, you allow them to do anything and you have a managed economy. Hello, the USSR...We know how that experiment has ended...


Name three retrains jon would impose on capitalism.

Can it be good?

Absolutely! It has proven to expand economies and offer much wider and greater socio-economic opportunities to a wider and greater number of people. The data supports this. Problems usually arise when the free market has too much interference, i.e., heavy regulations, cronyism.

Can it be free?

Well, depends on what you mean. If you mean something along the lines of laissez-faire, then I'd argue it's not free because it'll devolve into something that restricts greater access. If you mean free access and exit from the market, then it certainly can be free.

But, I think you are inferring a good point regarding the nomenclature. We should probably use the term competitive market, instead of free. There need to be some rules put on a market for it to thrive.

IMO, I believe that capitalism must be informed by an objective morality.

This is not always a good thing.


As the master said, the choice to work or the choice to starve.


Ethics rather than something as subjective as morality, and of course unquestionably and unambiguously under the workers' control.

Damn near every company on the face of this Earth borrows money and is indebted. You may crap your pants how often small businesses do this--guess who is exposed to all of the risk? Hint: it's not the worker.


I'm not sure what you mean by this, but America is not under an unrestrained capitalism. Plus, the American standard-of-living is high under our economic system.


If this was late 19th, early-20th century, I might agree with you to a certain degree. But, it's not the case today in most places in the West. Usually, in places where you find labor being grossly under-compensated if you dig deep enough it's probably due to something contrary to a competitive market practice.

To reward investors while the firm remains indebted? That's an American practice, a form of asset stripping, much criticised here and not legal everywhere..


The data shows that some counties' average income is not far from the level of the third world.


Fortunately everything is cyclical, and where the running dogs of capitalism are off their leash, there is an inevitable backlash. Capitalism has existed for only a very small part of human history, and the world's best known economist pointed out, it is only a transient stage in human development.

What do you think that will be? Socialism? Again?

Why are you so dead set on something that has been proven to be an abject failure since the inception of that concept?

Every Nazi, every fascist get's the deserved boot when he dares to want to repeat it....why do you think the world will react better to communism/socialism?

It's not what I think, it's what will happen. No system lasts for ever, and every system has a reaction to it.


Minimum wage, public healthcare, working hours regulations, an end to child labour, health and safety, old-age pensions, sick pay. Are they failures? Do you think the capitalists gave those out of the goodness of their hearts without a fight?

You are so right. My master, PRL, paid me 1450zl in 1966. That was enough to take a train to Miedzylesie and back. Plus lunch at the company cafeteria. After that, my 1450zl was gone and my starvation was not my choice anymore; it was planned into the deal by my Master.

So I left to be exploited by the bloodsuckers in the US.


...you will find hordes of wage depressing illegals working off the books for less.

But it won't be socialism! There are still people around remembering....


But it won't be socialism....you guys had 200 years....and even the still actual experiments are failing (Cuba, Venezuela)....people aren't blind or deaf!

Till there isn't another reaction, something new, coming around capitalism will always win...there just isn't a real rival. Socialism isn't it anymore.

That's why I asked you about what do you think will happen....in the hope you will come up with some new idea....but it's still the bad 'ol dream aka nightmare, isn't it!

In Germany we have a saying for such people "Ewiggestrige", people who can't leave the yesterday behind...

Minimum wage, public healthcare, working hours regulations, an end to child labour, health and safety, old-age pensions, sick pay.

Market economy....even before modern Germany. Old-age pensions got installed by Bismarck! :)

Socialist GDR had all that and still people run away...

Indeed. It will be the next stage.


Do you really believe that a 'market economy' achieved that, despite a century and a half of trade unions and Labour politiciams? You sweet innocent, you....

How will that look like?

All of those passed into the prices jon pays when he buys things. Hahahahaha...
Hey, jon, corporations don't pay taxes. They only collect them from you, the consumer, call them taxes, and pay the tax collectors...Hahahahahaha...

It's not a reward, jon. Investors give their own capital to an entity with expectation of receiving a return on that investment.


That's just plain wrong. It is not asset stripping. Borrowing money is not selling off assets; if anything, it's an increase in assets (cash). Yes, you have future liabilities of to pay back capital and interest, but that is not even close to stripping of assets. It's called doing business.


Some counties...may be true. But, the VAST majority of counties in the US...not even close. We are flooded with folks wanting to get in here to live a better life.

You should actually come to the US and see the available opportunities, even in this economic climate of inflation and slowdown, jobs to be had around every corner. Many starting at $18-$25/hour. And, by the way, the inflation, slowdown, and problems companies are having filling positions is not due to the market but government intervening by printing enormous amounts of money, incentivizing unemployment by paying unemployment and welfare benefits to citizens who have the capacity to be productive, and mandating vaccines which are causing workers who don't want it to quit.


True.

That's one of the excuses they try to give.

It's still asset stripping though, and it's causing huge problems right now.

However, as you were told, every political pr economic current has an opposite reaction. Often a brutal one.


I've been there, and seen how badly some people live compared to here.

This is a bit of a bugaboo for me. Some US corps pay no or little income taxes (but many pay their fair share), but they pay a freaking ton is payroll taxes. 66% of all taxes collected by the IRS come from employment taxes.

The reality of this is workers wouldn't have a place to work, if there weren't people who risk capital to start businesses that employ workers. AND...companies wouldn't be able to operate and grow their businesses, if they didn't have workers to produce the good and services companies sell.

In the Bolshevik world, it's exploitation.
By now, I feel sorry for you. Did you ever try to explain entropy to a four-year-old? It would be easier.

No, it is not asset stripping. Maybe you mean to call it something else, but it is not asset stripping.

I don't know your professional background, but I work in the tax arena and know how these things work. What you are describing is not in any scenario selling away assets, ie asset stripping.

To be technical, asset stripping in its proper definition is when a company buys another company for amount below its value then turning around and liquidating the assets of the bought company to generate greater profits from the sale of these assets.

Anyhow, we're entering the quibbling stage.

Jon, I would really, really, really like to know which reaction to capitalism you expect/wish for (said "next stage")!

Yes, it is asset stripping.


Then you'll probably be aware of the criticism here in Europe over the behaviour of some American 'private equity' companies.

We all asset "strip" when we take the cash home and, oh my God, spend it.