Talk:Capitalism/Archive 19

Getting unprotected (Again)

OK, to try and get us unprotected and move things on, here's what I suggest, I'm going to put below what I think could be an improvement to the lead, I then invite editors to comment and edit that part of my comments as they see fit, and we might be able to resolve this.

Capitalism is an economic system in which is based on capital being invested in the production, distribution and other trade of goods and services, for profit on the market. This include factors of production such as land and other natural resources, machinery and other intermediate goods.

Capitalist economic practices became institutionalized in Europe between the 16th and 19th centuries, although some features of capitalist organization existed in the ancient world.[1] Capitalism has emerged as the Western world's dominant economic system since the decline of feudalism, which eroded traditional political and religious restraints on capitalist exchange. Since the Industrial Revolution, capitalism gradually spread from Europe, particularly from Britain, across global political and cultural frontiers. In the 19th and 20th centuries, capitalism provided the main, but not exclusive, means of industrialization throughout much of the world.[2]

Some economists have specified a variety of different types of capitalism, depending on specifics of concentration of economic power and wealth, and methods of capital accumulation. During the last century capitalism has been contrasted with centrally planned economies. Most developed countries are usually regarded as capitalist, but some are also often called mixed economies[3] due to government ownership and regulation of production, trade, commerce, taxation, money-supply, and physical infrastructure.

--Red Deathy 10:57, 11 September 2006 (UTC)

The main two problems I see are (1) the first sentence that drops "private ownership" and talks about "capital" instead. I know that's meant to open the way for thinking about "state capitalism" by Red Deathy. But while I probably personally agree with the analysis it (a) is not main point of external sources and (b) involves the almost circular complex theoretical term "capital".

And (2) There is no mention at all of the fact the article will discuss the "various theorists" that make up 1/3 of the article. LotLE×talk 14:09, 11 September 2006 (UTC)

If that's what he's doing that's definitely the wrong way to go. "State capitalism" is not "capitalism." "State capitalism" is a very obscure term to describe what is actually socialism. We definitely should not try to make our own "original research" definition that will take into account "state capitalism." When people refer to capitalism, they're referring to "capitalism," not "state capitalism." Economizer 14:57, 11 September 2006 (UTC)

Feel free to change the above, then. The theory of state capitalism is not OR, maybe heterodox, but not OR, and some definitions of capitalism can encompass both it and its detractors. We are free here to word our own def, so long as we can cite verifiable sources for whatever we write.--Red Deathy 15:00, 11 September 2006 (UTC)

But to make our own new definition of "capitalism" that encompasses "state capitalism," so that the definition doesn't refer to "capitalism" anymore, would be original research. Capitalism and state capitalism are two different things. Economizer 15:04, 11 September 2006 (UTC)

I didn't suggest that, for me tha bove is teh definition of capitalism, state and laissez faire are both speicies of the genus capitalism, I wouldn't hold the state cap. thesis unless I sincerely believe the above to be a solid definition of capitalism in its own right - and no, it wouldn't be OR to word our def. that way, because we can point to a plenitude of sources that define capoitalism with at least those features, they are, I contend, the minimum definition of capitalism.--Red Deathy 07:02, 12 September 2006 (UTC)

I'm not worried about OR as such. The focus on capital formation (and indirectly "state capitalism") is certainly no invention of Red Deathy's. Nonetheless, it is a minoritarian focus. The majority of thinkers have started with "private ownership of the means of production" (as the current lead reads). Theoretical extrapolations or generalization of that—whether towards capitalization or towards Economizer's control/decision emphasis—are in the realm of individual thinkers, or at most minority schools of thought. Both those directions are reasonable to cover in later sections on particular theorists, but neither has any place in the lead. Still less, of course, belongs the thing that got the article locked this latest time: Economizer's efforts to ahistorically or anti-historically explain capitalism in terms of a partisan and particularistic contrast with "socialism" or "command economy" (two terms that are themselves theoretically complex and nuanced... and have no place in the lead of this article). LotLE×talk 15:12, 11 September 2006 (UTC)

You're absolutely wrong. In capitalism, the means of production are privately controlled. That is essential to capitalism. If the state is controlling the means of production, that's a command economy not a market economy. That's not a "minority school of thought" at all. That's the overwhelming consensus school of thought. Production decisions are made by the businesses themselves as guided by markets, not dictated by the state. There is no such thing as capitalism that is not a market economy. Economizer 15:15, 11 September 2006 (UTC) Are you going to tell me that the Merriam-Webster Dictionary, popular among the masses, is a "minority" definition?: "An economic system characterized by private or corporation ownership of capital goods, by investments that are determined by private decision rather than by state control, and by prices, production, and the distribution of goods that are determined mainly in a free market." Economizer 15:26, 11 September 2006 (UTC)

Are you going to tell me that the Merriam-Webster International Dictionary (unabridged), popular among the masses and considered authoritative, is a "minority" definition?: "An economic system characterized by private or corporation ownership of capital goods, by investments that are determined by private decision rather than by state control, and by prices, production, and the distribution of goods that are determined mainly in a free market." Economizer 15:37, 11 September 2006 (UTC)

This is precisely why I would strongly oppose unprotection as long as Economizer wishes to turn the article into a vehicle for his individual agenda. In clear point of fact, every reference source we have located mentions private ownership, and absolutely none of them mention "private control". A minority of references do mention capitalization. The peculiar quote Economizer adduces above is awfully good evidence of exactly this: he found one sociology text that began (roughly): The dictionaries are all wrong... because they miss this important aspect. It's not an unreasonable position to focus on that aspect of "control", but it's also not uniform enough to make it into standard reference works (inluding Wikipedia). LotLE×talk 15:32, 11 September 2006 (UTC)

To followup Economizer's added dictionary def. It's not too bad; certainly it doesn't say what Economizer is promoting. It does mention "control", but only in the context of investment, not of production, distribution, contracts, etc. But obviously, like all dictionaries or reference works, the lead is about "private ownership". It's interesting that MW also puts the issue of corpoprate personhood right in its first sentence, which starts to make me think Economizer's delection of that from the WP lead is not so good. MW is slightly to the outside of the norm on this "control" word. For example:

capitalism.

An economic system in which the means of production and distribution are privately or corporately owned and development is proportionate to the accumulation and reinvestment of profits gained in a free market.

--The American Heritage (r) Concise Dictionary of the English Language, Third Edition. Copyright (c) 1992

In the AH dictionary, the "control" part is omitted, but the "corporate" part is included. But the phrase "free market" is indeed in both; so as much as I think the term obscures more than it reveals, I reckon we should keep it in our lead. It's interesting the AH sort of hints at the capitalization thing, but somewhat obliquely. LotLE×talk 15:46, 11 September 2006 (UTC)

The Merriam-Webster definition says "prices, production, and distribution are determined mainly in a free market." What do you think that means? That means that the state is not dictating those things, but rather businesses are deciding on their own what to produce and in what quanties. Economizer 15:49, 11 September 2006 (UTC)

I agree with Lulu on this one. As it now stands, introduction is quite good and I wouldn't change it significantly. -- Vision Thing -- 21:13, 11 September 2006 (UTC)

Hoag textbook

I don't know where you've been, but this is stuff you learn in Economics101. Here is an economics textbook: "Capitalism stresses private control of the resources, whereas communism depends on public control. Socialism is located between the two extremes and neither public nor private control dominates." (Introductory Economics, World Scientific (2002), John and Arleen Hoag) Economizer 15:51, 11 September 2006 (UTC)

I do recognize the idiosyncratic spin you are trying to extract from MW. In terms of "where I've been"... I guess around professional economists rather than community college teachers like the Hoags (i.e. the people who taught the people who taught the Hoag's). Their sentence isn't so awful, in the right context (which it's obviously wrenched out of). I got curious about this textbook, and looked on Amazon:

This book is great, April 29, 2006 Reviewer: Camilo Montenegro (Mexico, D:F: Mexico)

If you're like me, interested in economics with no previous background in math or econ, then this is the best place to start. I enjoyed it greatly. Yes, it is "dumbed down", so if you do have previous knowledge of math or econ, then this is most certainly not the book for you, but that does not mean that this book is in anyway "dumb". This book is simply what it claims to be, an introduction to the world of economics. It is well written and easy to understand. Though I do believe the Micro section is stronger than the Macro, it is a great place to begin. Consider it an Intro to an Introductory course.

This book is crap!, February 7, 2006 Reviewer: V. Cummings "victorc1978" (Two Rivers, WI United States)

This books sucks,I have never had an intro level book read so horribly - they are like all over the place talking about this and then say but we will cover that in a later chaper! Why did they even bring it up! Does not have far enough graph examples - try again!

Those are just two reviewers (the two Amazon chose to put at top, for whatever reason they use). But it probably gives a good feeling that the text is more-or-less OK for very beginning non-majors in Economics... but basically, it's the "dumbed down" version. LotLE×talk 16:02, 11 September 2006 (UTC)

It is dumbed down. It's for first year economics students. That's why I referenced it, because it's such an elementary concept. And whoever wrote this article isn't even aware of such dumbed-down elementary principles of capitalism. That's why this whole article is so horrible. Whoever wrote it doesn't seem to know the first thing about capitalism. You weren't even aware that a "free market" means that the government isn't dictating what is bring produced and what quanties but businesses themselves were free to decide that. In other word, control over production, pricing, and distribution is private, not governmental. For example, if you own a computer manufacturing business, in a capitalist system, the governement can't come in and tell you have to make 200,000 computers this year and you have to price them at $500 each. Those decisions are up to you. YOu make your decisions based on your own self-interest in order to maximize your profit. You control your own means of production. This is not some radical minority position. This is basic and broadly accepted as being part of the definition of capitalism. Without question, something this basic and elementary to capitalism should be in the intro. Economizer 16:08, 11 September 2006 (UTC) Need another dictionary?: ""An economic and political system characterized by a free market for goods and services and private control of production and consumption." (New Dictionary of Cultural Literacy) Economizer 16:40, 11 September 2006 (UTC)

OED:

Capitalism: The condition of possessing capital; the position of a capitalist; a system which favours the existence of capitalists.

Capitalist: One who has accumulated capital; one who has capital available for employment in financial or industrial enterprises. Also attrib. and Comb., as capitalist-imperialist.

Capital: 3. A capital stock or fund. a. Commerce. The stock of a company, corporation, or individual with which they enter into business and on which profits or dividends are calculated; in a joint-stock company, it consists of the total sum of the contributions of the shareholders. Also, the general body of capitalists or employers of labour, esp. with regard to its political interests and claims (cf. LABOUR n. 2b). b. Pol. Econ. The accumulated wealth of an individual, company, or community, used as a fund for carrying on fresh production; wealth in any form used to help in producing more wealth.

I quite like the OED def. of capitalism (for obvious reasons, it agrees with me, and it personalises the system). Hope this helps.--Red Deathy 07:11, 12 September 2006 (UTC)

And in capitalism, the capitalist controls the means of production, not the state. Economizer 15:44, 13 September 2006 (UTC)

Is a corporation a public or private entity?

If a corporation is a public entity is it properly considered part of a capitalist system? For clarification, a corporation grants limited liability to its owners, protecting their wealth in case of any wrong doing. This limited liability status accrues to parties that do business with the corporation and to parties that do not do business with the corporation, such as neighbors or other third parties (this last type of limited liability, without an implicit or explicit contract between the parties, is granted by the state, making the corporation a public entity rather than private entity). So why does the 'private ownership if capital' definition of capitalism include corporations? Mrdthree 18:15, 18 September 2006 (UTC)

Why would it exclude corporations? Some corporations are privately owned and some are state owned (such as the U.S. Post Office). I don't see limited liability status having any bearing on determining ownership. Just because the corporation has limited liability status for the owners, that doesn't mean the state owns the corporation. Economizer 00:27, 19 September 2006 (UTC)

It's not whether the state owns it, but whether corporations can exist separately from the state which creates the legal framework to bring them into existence. Most corporations are not controlled by their owners but by employees who are controlled, IIRC, by laws which state they must act in the interest of the owners. A clear example of this in action was the behaviour of Union Carbide staff over the Bhopal disaster in which, despite being personally horrified and shocked to tears they still had to go out and deny responsibility because otherwise they'd be acting against the interest of shareholders. (Yes, CEOs are poften shareholders, or given shares, but that isn't necessarilly the case). Anyplace, the point is corporate capitalism probably deserves some comment in the article, along with teh fact that in advanced capitalist states, such as teh UK, corporately owned shares make up the bulk of share ownership.--Red Deathy 07:26, 19 September 2006 (UTC)

This is either a matter of semantics, or of people working within two distinct theoretical frameworks. To put it in the terms of our NPOV policy, neither of you is right or wrong, but you are representing distinct points of view. My understanding is that liberal advocates of capitalism (in the Austrian tradition) would see corporations as private rather than public not because they deny the existence of legal frameworks that regulate (or protect) the ownership of capital, but because the "public" activities of the state that they oppose are limited to direct interference in the market and the actual ownership of capital. My understanding of Marxist critics of capitalism is that they would not see corporations as "public" as such, but that they would acknowledge that the creation of many corporations required the destruction of prior forms of private ownership of the means of production (e.g. cottage industries), and reflect ways in whcih the state (through legal frameworks) protects one class at the expense of another. I wonder whether "public/private" and "bourgeois/proletariate" represent two very different ways of making sense of capitalism. Perhaps people used to one way and people used to the other way will often misunderstand or just talk past one another. Slrubenstein | Talk 10:44, 19 September 2006 (UTC)

Marxists WANT to abolish private ownership of mean of production. Economizer 15:10, 19 September 2006 (UTC)

Correct. Marx believed in "progress." He felt that bourgeois society, which had partially destroyed private ownership of the means of production, was superior to the economic system that preceeded it. he saw communism as finishing the job capitalism started. Slrubenstein | Talk 15:19, 19 September 2006 (UTC)

Of course limited liability laws can't exist without a legal framework. So what? Economizer 15:10, 19 September 2006 (UTC)

I am for private ownership. My point is that corporations are political or public entities and not entities created by contracts between private parties. A buyer and seller can contract to make an exchange that limits liability between them, but they cannot contract on behalf of third parties. Corporations are a legal entity that can bind not only business clients to limited liability but also third parties (people it does not do business with, i.e. the public). The owners of a corporation do not have full control over a corporation, they must commit to an executive structure defined by law that they cannot alter. A democratic-republic is 'controlled by the people' in a similar manner that a corporation is 'controlled by the shareholders' (we even have limited liability for government debt). Mrdthree 18:52, 19 September 2006 (UTC)

Though I see some of your point, a government has 'public ownership' because all people over 18, etc. have a voice in its policies. A corporation has 'private ownership' because only shareholders have a say over corporate policies. However, it must be acknowledged that a corporation must make additional agreements with the government (acting on behalf of third parties or the public) in order to gain limited liability from the public at large. I would still claim the corporation violates the usual assumptions of market capitalism as the public is an implicit party to contract between corporations and other businesses, i.e. the contract involves more than proximate buyers and sellers.Mrdthree 19:10, 19 September 2006 (UTC)

Mrd, even if I were to accept that limited liablity is "state-created", that wouldn't make corporations "state-created". Limited liablity is not an inherent part of corporations. They can have, or not have this feature. The only defining feature is entity status. MrVoluntarist 19:17, 19 September 2006 (UTC)

I agree there are entities such as sole proprietorships or general partnerships and there is no reason one could not have an entity like the corporation based on small loans acting like stock. That would shield lenders ('stock owners') without shielding corporate officers. My point is twofold, first capitalism doesnt rely on the coporation and second I believe that to a large extent 'market externalities' such as pollution are a product of the government policy of allowing limited liability. Corporate decisionmakers are shielded from concerns about 'unintended consequences' or 'market externalities' more than individual agents in the marketplace, and can make decisions without risking personal wealth.Mrdthree 19:40, 19 September 2006 (UTC)

Whether capitalism relies on the existence of corporations or not is a matter of POV. I happen to agree with Mrdthree, but we both have to acknowledge that there are some historians of capitalism who see the development of corporations as critical to the emergence of capitalism. Also, a tangential note sort of, but Mrdthree you are being anachronistic. It is true that today in the US at least the government represents all people over 18. However, when corporations first developed as an institution, governments - all to my knowledge - represented only male property-holders. Slrubenstein | Talk 15:59, 20 September 2006 (UTC)

Mrdthree said, "The owners of a corporation do not have full control over a corporation, they must commit to an executive structure defined by law that they cannot alter." Actually, I think the executive structure is defined in the Articles of Incorporation. But even if the structure is defined by law, the composition of the individuals in the actual executive positions IS controlled by the owners (that is, the stockholders).

---

Suggestions to the Definition of Capitalism

The introductory definition misses in my view essential points. It reads: “Capitalism is an economic system in which the means of production are mostly privately owned, and capital is invested in the production, distribution and other trade of goods and services, for profit in a competitive free market.”

No ‘economic system’ is per se. It is a creature of the law. Therefore ownership is a legal instrument and, if meaningful, needs to be protected by law and (if need be) by legal force – if the concept of ownership is supposed to have any meaning at all. So the first half of the sentence should in my opinion read: “Capitalism is an economic system in which private property is allowed and protected by law….”

The second part of the definition is beside the point. The essence of capitalism is not capital - but risk bearing. Regardless of whether I just ‘invest’ my own bodily labour (which I own) or my savings of $ 10.000 (or any mixture of it) I bear the risk of the outcome (profit or loss) in a capitalistic system. In other words – capital is not the defining feature of capitalism. Therefore the second part of the definition should read as follows: "….and any combination of property is deliberately employed in order to potentially realize a profit."

All the other stipulations in the present definition do not contribute to the essence of what defines capitalism - in my view. Please, nobody needs to get upset – it’s only a suggestion.

Suggested Reading: Murphy, Liam and Nagel, Thomas (2002), The Myth of Ownership - Popeye2 17:18, 2 October 2006 (UTC)

Capital is labor or savings or anything else you have to invest. That's the definition of capital. You can't have capitalism without something to risk.

Also, it's not a creature of law, as it may be a creature of the absence of law. If you have people go into an area who then begin to set up system of risking their labor or material possessions, buying and selling, and there is no law there, then ownership isn't a legal instrument, it's a fact of life. Just because there's no law regarding it doesn't mean that it doesn't exist. Hires an editor 20:21, 2 October 2006 (UTC)

I agree with your statement “You can't have capitalism without something to risk.” And that’s the essence of the first part of my suggested definition. What you ‘invest’ is immaterial – economically you just chose between consumption and investing.

I do not agree with the latter part of your statement. Property is rightful possession acknowledged by others, meaning it is a relation among people regarding things. Without rightful possession there is just possession and possession is (in the end) a matter of physical dominance. There is no historical evidence and no inherent logic in the claim that capitalism would develop without (enforceable) rules (of law). For a starter see John R. Commons, Legal Foundations of Capitalism, 1924, Chapter IV, Transactions. Popeye2 06:15, 3 October 2006 (UTC)

Popeye2 is right, but more importantly, he is not making things up. The way we write encyclopedia articles is by doing research. Popeye2 has provided verifiable sources for the views he has forwarded. Hires an Editor just seems to be exercising his or her own imagination. Slrubenstein | Talk 09:48, 3 October 2006 (UTC)

That isn't the end of it, though, many of the potential definitions we've seen here are in effect reformulations, extrpolations or simple rewordings of the current on - Poeye's are arguably implicit in the current def. (although I'd dispute risk as an essential quality rather vigorously). I continue to endorse the masterful OED defs. I cited above.--Red Deathy 10:49, 3 October 2006 (UTC)

Well, we certainly should avoid overwrought definitions. Personally, I am oppsed to a definition - I think when it comes to some things, like Capitalism, dictionary definitions which are guides to popular usage are seldom encyclopedic (though I do often defer to OED) and more to the point, virtually any definition is POV because one of the things people from different points of argue about is how to define capitalism. I see no reason why all Wikipedia articles should mechanically open with a definition. What is important is that the introduction introduce the article as a whole. I an not arguing against the current opening, only pointing out that we need not be limitted to one format for an opening. An introduction tht explains why even people who disagree over how to define it agree that it is important, or that explains what the main points of contention are, can be just as effective an introduction as a definition. Slrubenstein | Talk 11:10, 3 October 2006 (UTC)

Well, an encyclopaedia article is by definition a definition, even if an extended one, but over at socialism they seem to have tried to avoid too tight a def. - the range of theories opening option may help.--Red Deathy 12:07, 3 October 2006 (UTC)

Okay, so I let the second part of my comment get away from me. I withdraw it. I still stand by the first part, however. You can't have capitalism without capital (labor or property). Every article about a capitalist thinker, and capitalism in general, talks about means of production in some form or fashion. Without this, capitalism doesn't exist. Hires an editor 18:52, 3 October 2006 (UTC)

Hi, granted, capitalism needs ‘capital’. But there are – in my view – several difficulties using the term capital in a definition of capitalism.

The first problem is that capital is multifaceted term. It can mean money or claims expressed in money terms or it can mean real things like a car or a machine. But each of these items can also be non-capital depending on the circumstances in which these things are employed. So the definition of capitalism by means of the word capital poses a semantic problem for most people and is also a close candidate for a vicious circle. Secondly, many economies today are service economies where ‘soft capital’ (know how, intellectual property and skills) plays the dominant role as compared to bricks and machinery. This complicates the term capital further. Few would associate a patent or a copyright with the term capital.

But all of these hard and soft resources employed in an enterprise have one thing in common – they are foremost property and/or property rights, which combined with human resources, are employed in a specific manner for gain. As profit is a residual (in contrast to a contractual) claim on the gain of this assembly of resources - its defining feature is risk. After all contractual obligations of an enterprise have been paid what remains (the residual) is the profit or loss of this enterprise because it is not know at the onset. That – in a nutshell - is the reasoning for my suggestion, which, I am sure, can be improved. 81.210.177.108 06:02, 4 October 2006 (UTC)

Portal Created

So, I created the Capitalism portal. I originally did this in order to help reduce some of the conflict found in the main article, figuring that maybe the portal would be a good place to highlight the different points of view, give more room to these points, maybe reduce the main article down some...I discussed its creation on the Business and Economics portal talk page, but I realize I should have discussed it here. The reason I didn't is because I wasn't sure that creating the Capitalism was warranted. I'm still not sure. Feedback and/or work on the portal is appreciated. Hires an editor 20:06, 3 October 2006 (UTC)

New def. attempt

Frankly, I'm content with the current def, but to offer a possibility to those who find it contentious this occured to me as a way round too tight a def. "Capitalism is the term generally used to refer to the economic system most commonly associated with that in the United States and Western Europe. Its precise definition is subject to dispute by both critics and supporters, but is most generally thought of as being a system in which the production and distribution of consumer and productive goods is predominantly governed by market relations." etc. etc. - or something like that, lead with a concrete real world example and then mention that the definition is contentious and then move into the contending accounts. Owzat?--Red Deathy 07:12, 4 October 2006 (UTC)

Before we decide on a change of the definition I do suggest we discuss what distinguishes capitalism (as an economic system) from socialism. In my view the distinguishing features are

- the question of ownership of ‘the means of production’

- the question of how the production is distributed

- the question who bears the risk/chance of failure/success

While I would have written the article Socialism slightly different (mainly because ‘social control’ is the essence of any political system), I do think the article starts with a decent definition. But I rest my case – also because English is not my native language. Popeye2 08:48, 4 October 2006 (UTC)

"...totally sucks"

In the definition, there is a line, "Capitalism is an economic system of distribution which totally sucks..." I don't know if you guys agree, but that doesn't seem neutral. I was just wondering if my deleting the words "totally sucks" would be apporpriate.

Hopefully, someone has deleted this vandalism. Next time you see this, just do something! Like delete it. :-) Hires an editor 22:11, 25 October 2006 (UTC)

When was wikipedia EVER neutral?

-G

Capitalism in Eastern Europe

I think their needs to be an article or sub article on capitalism in eastern Europe --J intela 04:45, 27 October 2006 (UTC)

I really agree with that, something defining the differences between capitalistic, or semi capitalistic markets, like from the United States, various capitalistic markets in Europe, and other counties. For instance, the American market takes a large interest in philanthropy, and social benefit programs that are supported by the market and separate from government socialistic programs, whereas a large majority of other markets aren't involved in such programs (Examples in the states are the Bill and Melinda Gates foundation, or the billions of dollars that are donated for educational causes ever year). Like here in Brazil, donations from businesses and those of wealthy persons are rare, and just about all student scholarship programs, school funding, social programs, etc, are funded by the federal state. There could also be an article of how capitalism supports socialistic views in many aspects, again pointing to philanthropy.

My two cents 201.43.6.118 18:11, 9 November 2006 (UTC) Charles Black

Lead para

Well, it's come up again - we had a largely stable intro - 1) We don't need to insert privately everywhere, as if it's some sort of mania, if the Means of Production are privately owned then investment into that MoP is private. 2) Whilst there is some dispute over whether state capitalism exists on this page, the previous wording had the virtue of being silent on the question - if you accept that state capitalism exists, it is still capitalism, albeit qualified. 3) As I said, my works pension is owned by an Incroporated body (a university) Funded by the British state, it invests in Means of Production on a market - what status does my pension fund have? State or priovate? the answer is, Market Agent.--Red Deathy 16:47, 21 November 2006 (UTC)

1)If the state is doing all the investement that it's not capitalism. In capitalism there has to be investment by the private sector. The definition simply said "capital is invested."

2)It doesn't matter whether "state capitalism exists." The concept and definition exists, so that's good enough. BUT, "capitalism" does not refer to "state capitalism." There is "capitalism" and then there is "state capitalism."

-Improper Bostonian

Well, but what of my example of a state funded self-organised corporate body? As the article said, the means of production are mostly privately owned, that means most of the investment is therefore private. As for state capitalism logically, it is capitalism, qualified by a state doing the acting, in much the same way as a blue coat is a coat, that has the added quality of being blue.--Red Deathy 17:04, 21 November 2006 (UTC)

Just because the means of production are privately owned that doesn't mean that investment is done by the private sector. The government could simply tax everybody and then invest the proceeeds in the various businesses of its choice. It there's no private investment it's not capitalism. "State capitalism" is not "capitalism." You can't contruct a definition of "capitalism" that would include the definition of "state capitalism" without rendering the definition hollow because they're two very different things. What the somewhat obscure term "state socialism" denotes is usually called "socialism." If you want to talk about "state capitalism" then why don't you just put in a note in about "state capitalism"? -Improper Bostonian

If the government invested in those businesses, it would be the owner, and you wouldn't have private ownership. I can and do construct a definition of capitalism that doesn't include private ownership as an essential quality, see somewhere above for a definition of capitalism from the Oxford English Dictionary that does just that. State capitalism does get a reference, in the article, but the def. in the lead para can and should be kept to the sufficient level to avoid vast conflicts. Let's try taking my owrkplace, again - it is a private body, a chartered corporation, funded almost exclusively by the state, are it's investments private? What about investments by charities? What if all companies were co-operatives? Wouldn't really be private then. Capitalism is the employment of wage labour in order to produce goods for exchange at profit. That's a reasonably well used def. that I work from, and I was moderately OK with the previous wording, but I think that the changes you've made are incorrect and unnecessary. Now, I've cited one source, the OED, you got any better?--Red Deathy 08:18, 22 November 2006 (UTC)

No, it is not true that if the government invests in those businesses that it would be the owner. For instance, the government can tax people and invest in businesses that engage in alternative fuel research. The government doesn't become the owner of those businesses. If you're workplace is funded by the state, then no, that's not private investment. That's public investment. Investement by charities is private investment. What do you mean if companies where cooperatives? Cooperatives are private companies. An economy with only, or mostly, public investment would not be capitalism. There is no such thing as capitalism without private investment. That means that the private sector decides where capital goes. Yes, I do have better than the OED. THe Merriam Webster Third International Unabridged Dictionary: "an economic system characterized by private or corporation ownership of capital goods, by INVESTMENTS THAT ARE DETERMINED BY PRIVATE DECISION rather than by state control, and by prices, production, and the distribution of goods that are determined mainly in a free market." I agree that "state capitalism" probably shouldnt be in the intro. But I put it there beause you are trying, as you admitted, to make the definition fit "state capitalism." Improper Bostonian 15:50, 22 November 2006 (UTC)

Perhaps we're working on a different meaning of investment, traditionally one invests by becoming a shareholder. Government investment by subsidy simply means a government gift to the owners of the company. So, if my corporation, University, funded by the state's investments are not private, what about investments by an employee of the stae - if I put my wages, which wholly come from taxation, into stocks, is that state money or private investment? When does teh magic fairy descend and change it? Capital is capital when it acts like capital - if a government invests commercially as if it were a private actor that does not change the nature of its capital. I tolerated what i thought was a slightly incorrect definition of capitalism before, because it wasn't too wildly out. Finally, why is teh Webster Def. better than the OED? Surely it is equal?--Red Deathy 16:09, 22 November 2006 (UTC)

Private investment means the DECISION about where to invest is not made by the state. Subsidies, also called "investment subsidies" are just one example of state-directed investment. Also, the state could directly tell private enterprises that they must invest in particular projects. What is essential about capitalism is that most investments are voluntary. If I have a business I am allowed to choose for myself where my profit is invested. Just saying in the definition that "capital is invested" doesn't distinguish capitalism from socialism. In socialism, capital is invested as well. I don't understand why you're fighting something that's so easy to note in the definition. Improper Bostonian 16:18, 22 November 2006 (UTC)

Well, no, because there could not be capital in socialism, it would not be invested with a view to making a profit, it would be allocated to meet a definite end. A state actor can freely ivnest, and invest to make a profit, as if they were a private capitalist, so long as their actions can be seen to be commercial - as most state pension funds are run commercially. Take it anotehr way, what is teh sifference between my employer running it's own pension fund, as a nationalised, say, industry, instead of handing over a sum of money to a private commercial pension fund to do the same? In the former case it is state investment, in the latter, it is private investment, apparently. In socialism tehre is no money, so we cannot have pension funds.--Red Deathy 16:26, 22 November 2006 (UTC)

In socialism there is no money? What?! What are you talking about? You must be talking about utopian communism. That's not what is typically meant by socialism. In socialism, the state owns the enterprises or heavily controls private enterprise and investment. If the state is doing the investment then they are not as a "private capitalist" because they take their money from the private sector. They don't earn from trade. It's entirely different. Because it's taken from taxes, that takes investment funds out of the private sector. It does not allow the private sector to decide where to invest those funds. Improper Bostonian 16:34, 22 November 2006 (UTC)

Historically socialism and communism meant the same thing - stateless, classless moneyless society. If I steal money, or inherit and then begin ivnesting it, I remain a capitalist, if the state starts up a firm with money taken from taxes, then as long as it invests it and relies on profits from ivnestments rather than subsidising from taxes, it is behaving as a capitalist. You don't even want to start me on the fact that according to Adam Smith wage and salaried workers cannot be taxed, such a fun argument. Anyway, state capitalismis where the state owns the MoP and behaves like a capitalis, producing goods for sale with a view to maing a profit--Red Deathy 16:41, 22 November 2006 (UTC)

If you steal money and invest it, you're only a "capitalist" in the sense of being an owner of capital. That's not what is meant by "capitalISM." In capitalism, you acquire wealth by trade, not by theft. Again, you're equating "state capitalism" with "capitalism." They're two entirely different things. If you want to talk about "state capitalism" then you should write a few sentences about it. This article is about "capitalism," not "state capitalism." Or why you don't you work on the state capitalism article? Improper Bostonian 16:45, 22 November 2006 (UTC)

PLenty of capitalists get their start up wealth from inheritence. Some get it through gambling windfalls, some get it through luck on the stock exchange, the point isn't the original source, but what you do with it. If I won the lottery,a nd ivnested my money, I'd be a capitalist as long as the money I won was invested as capital in order to produce for profit. If you take your start-up capital and invest it for profit, you're a capitalist and that's capitalism. I'm talking about capitalism, cheers.--Red Deathy 16:50, 22 November 2006 (UTC)

You've got it wrong then. In capitalism, it does depend on where you get your wealth. If wealth is not obtained through trade, then it's not capitalism. If I go to you and pull a gun on you and demand your money, that's not capitalism. Similarly, if the state confiscates all yours and my wealth then invests it, that's not capitalism. Improper Bostonian 17:01, 22 November 2006 (UTC)

I've gotta go home, but I'll leave with this - a great many capitalists, such as the Getties, the Rothschilds and the Rockefellers inherited their wealth: do they cease to be capitalists because of this? Capitalism itself was founded upon the theft of human lives called the slave trade, not to mention the judicial theft of the common land. Capitalism is capitalism is teh predominent econjomic activity is investment of capital to make a profit, if, twenty years ago, a state body used taxpayers money to start a fund which it invested profitably and without subsequent input from taxation, that is capitalism.--Red Deathy 17:05, 22 November 2006 (UTC)

Inheritance is not theft. It's a voluntary transfer of ownership. That's what is essential about capitalism. A society where people are slaves, is not capitalism either, because that's not a free market transaction. Theft of land is not capitalism either. Transfer of land ownership in capitalism has to be voluntary. Improper Bostonian 17:08, 22 November 2006 (UTC)

Inheritance is unearned and it is not got by trade nor investment, necessarilly. My point was, the source of the statr up capital is irrelvent, money has no smell, it's what's done with it and how that counts. Imagine if a local council borrowed money (either from another council or from private persons) and then invested it in a business, run at a profit and all the debt was paid for from revenue - would that be capitalism? Or is it solely the quality of being a public body, some existential mystical property taht disqualifies it? Personally, I think it is the act of investing through a market in capital that is teh significant feature, not who does the investing...--Red Deathy 08:38, 23 November 2006 (UTC)

Yes the sources of start up capital is relevant. If capital is being obtained at gunpoint, that's not capitalism. Improper Bostonian 02:29, 24 November 2006 (UTC)

We're running out of space at the side. Anyway, teh Free market page is awful, I can't see any justification for its independent existence from a page on amrkets in the first place. A market is a market. It is not the private nature of the investment that is an essetnial feature of cpaitalism, but that there is a market in capital/investment - no matter who is doing the investment. Taxation is a voluntary as inheritence - in a democracy where we voted for the government that set the taxes, we could abolish taxes if we so wanted, after all, so voluntarism cannot be an essetial defining feature. I would appreciate some third part involvement ehre, becuase me and Bostonian seem unable to agree, I tried a compromise formulation, but they seem to instist on Free and Private, I'll try again.--Red Deathy 08:07, 24 November 2006 (UTC)

No a market is not a market. There is a free market, and then there's a controlled market. In a controlled market, the government sets prices, either directly or by dictating production policies. In a free market, prices and production decisions are left to private decision. Improper Bostonian 03:53, 25 November 2006 (UTC)

If there is commodity exchange, one way or another, the government is going to have to obey market froces in its pricing.--Red Deathy 08:13, 27 November 2006 (UTC)

That's not true. The whole point, ostensibly, of a controlled market is that the government can do a better job at distributing resources by setting the pricing and production policies instead of leaving it to those enterprises themselves. There is only a market in the sense of people buying and selling things, but the prices of those things aren't determined by supply and demand so it's not a free market. Improper Bostonian 17:20, 27 November 2006 (UTC)

Well, think about it, supply and demand is real - if the government sets a ludicrous price, then real world factors will start to take control - if the price of bog roll is greater than that of a Rolls Royce peope will wipe themselves on bank notes - unless you can compell purchases you cannot completely control price - you can distort price, but the critique of contrlled markets is that they fail. Controlled markets are not a synonym for ecopnomic planning or state control, you could have non-market methods of distribution - free housing, etc. So long as there is an element of market, of goods actually being exchanged in some ratio or other, then market forces will apply. teh difference between a free and a controlled market is one of degree only, hence conceptually they belong in the same article as facets fo the topic market.--Red Deathy 17:26, 27 November 2006 (UTC)

Well of course state control of the market causes problems. That's why command economies have shortage, surpluses, and other inefficiencies. If the market is not largely free, that is, if firms are not allowed to decide for themselves production and pricing policies then it's definitely not capitalism. Improper Bostonian 17:30, 27 November 2006 (UTC)