No.99071
Don't firms and individuals in a capitalist society have large incentives to rent-seek, in other words, isn't it the case that cronyism an endemic feature of capitalism?
If individuals with enough money can and have an incentive to use rent-seeking to get political favors, is that the real argument behind trying to force income equality? In other words, are proposals for income equality because of a more positive institutional arrangement than a direct moral argument?
Related Link:
http://files.libertyfund.org/econtalk/y2019/Mungercrony.mp3
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No.99113
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No.99117
Income equality is just rent-seeking by less-productive individuals.
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No.99125
>>99113
Have you not heard of rent-seeking before?
https://en.wikipedia.org/wiki/Rent-seeking
<Rent-seeking is an attempt to obtain economic rent by manipulating the social or political environment in which economic activities occur, rather than by creating new wealth
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No.99127
>>99071
Only if you have a state apparatus that enables rent-seeking. If there are no bureaucrats to bribe rent-seeking behavior becomes impossible.
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No.99128
>>99127
You mean you're in favor of capitalists saying, "That's not real capitalism?"
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No.99129
>>99127
I was gonna say, this isn't even an anarchy thing. Minarchists and small-government fudds argue the same point.
>>99071
Rent-seekers exist in any capitalist society, but it's not a question of existence but a question of extent. Without an apparatus to enforce their destructive behavior, they can only rent-seek insofar as others are willing to put up with their behavior. The very nature of rent-seeking is pretty arbitrary though and thus I don't like getting too deep into it. By capitalist measures, a rent-seeker might be someone who leeches off the system in a parasitical relationship that is simply unsustainable in an economy of scale but realistically possible at a local level. However, by leftist measures, a rent-seeker might as well be a factory owner not paying full wages to his employees or shipping production off to third worlders. In these situations, he could be considered a rent-seeker if he is keeping these excess profits made from harming the economic life of his employees, but this is not necessarily always the case. If AnCapistani Wal-Mart and Costco are both shipping their labor overseas or paying their employees less than they should be, but AnCap Wal-Mart happens to be re-investing that money into better facilities, cheaper products, better transportation lines, whatever the case may be, then Wal-Mart is simply not rent-seeking so much as reallocating resources within the company. Eventually Wal-Mart's services will become cheaper/better/more reliable/etc. to the point where Costco would have to stop their rent-seeking behavior, or potentially face collapse of their business/bankruptcy as Wal-Mart continues to outpace them by using their resources more efficiently. If Costco is able to both use their resources more efficiently AND keep a little to the side for themselves, then can it really be called rent-seeking at all, or is it simply a bonus to the paycheck for being the better businessman?
I'm not trying to claim rent-seeking won't exist, surely you'll have the employers who treat their employees like sacks of shit, don't fix things, malinvest, etc. What I am saying is that these cases will be isolated to local or regional cases at best because of the competition factor that prevents this behavior on a mass scale. It's simply not plausible for a rent-seeker to out-perform a legitimate business in an economy where the government isn't regulating it to hell and high water.
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No.99130
>>99129
Another example I've seen used as an example of the capitalist model and rent-seeking is the river model that Wikipedia mentions. Ideally these situations wouldn't pop up in a free market society, but let's assume some asshole bought a portion of highway and installed a $100 toll on it. He would have to either have the money to install the automated systems/hire the employees necessary to collect that toll, or he would have to do it himself, sitting there day-in and day-out both guarding his chain he uses to block the road and collecting money. He most certainly will not receive the support of what ever towns happen to be nearby, he will have to justify his toll, and he will be risking his health in the rain, sleet, and shine, as well as risking the possibility of an angry truck driver ramming through him/his chain, or brigands stealing everything he owns since they know he's there all alone with his chain, charging his toll. The problem is self-correcting in that one of three things must happen. He must provide a service to justify his toll and the existence of his toll for others (he is bound to a regional scale in the effectiveness of his toll), he will see his claim on the property become seen as illegitimate, or people will simply build another road or mountain tunnel that goes around his toll because he's a faggot (in which case he's lost any capital he invested in his toll as well as any reason to maintain the toll). It's self-correcting behavior in most cases.
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No.99131
>>99130
Isn't this essentially arguing, "We have to have good/the correct people in charge?"
>>99127
You can have rent-seeking behavior in a non-state environment, because anytime you have an individual with enough money or influence, then you will have a window for rent-seeking from that individual (which is why income equality was brought up in the OP).
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No.99132
>>99131
>You can have rent-seeking behavior in a non-state environment, because anytime you have an individual with enough money or influence, then you will have a window for rent-seeking from that individual (which is why income equality was brought up in the OP).
You can only lobby a person or entity that has a monopoly on coercion
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No.99133
>>99132
What's panhandling?
I agree that lobbying the government is a degree of order more onerous, but you can definitely lobby a person or entity. What about the various companies 'deplatforming' individuals? That was done by activists "lobbying" or engaging in the private equivalent of "regulatory capture" in payment processing companies.
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No.99137
>>99128
No, because unlike the commies, "real capitalism" is not some magic, unattainable thing with no proper definition. And unlike the commies, we can show a clear relationship between how close to "real capitalism" an economy is and how well it performs. Communism by contrast seems to have a very sharp discontinuity in that relationship–things get progressively worse as you approach 99.9999% communism, but once you hit that mythical 100% communism, there's some unexplainable jump to nirvana and paradise.
This is relevant to rent-seeking behavior, because even if we haven't reached the "real capitalism" euphoric Nirvana of ancapistan, we can still see real changes the closer we get to that; the less entrenched the government bureaucracy, and the less power that bureaucracy has, the less rent-seeking there will be. The economic history of the United States is an excellent example of this. Prior to the turn of the century, the market was by and large a competitive one, business turnover was high, and while there were still issues here and there, entrenched monopolies didn't exist outside of direct government contracts. Come the Progressive Era, however, all of that changed. The sudden influx of bureaucracy, and with it the rapid increase in government intrusion, brought with it all kinds of new apparatus for government power. The Sherman Anti-Trust Act in particular was a potent weapon in the hands of rent-seekers, and it was used as a cudgel by businessmen who wished to compete for the favor of politicians that would destroy their competition on their behalf rather than perform the much more expensive task of competing on the market. This is exactly what happened with Standard Oil, the entire raison d'etre of Sherman. The congressman who pushed for the Act to get passed was in fact backed by some of Rockefeller's smaller competitors, who envied his share of the market, and, rather than spend a great amount of time and effort to streamline their production process as he had, chose the much cheaper method of bribing a congressman to bring the power of the state to bear against Rockefeller. If the federal government didn't have the authority to do this, there would have been no possibility of these people rent-seeking.
>>99131
Income equality was brought up explicitly in the context of political favors. You can't bargain for political favors if there's no political apparatus, no? And yes, to some extent, rent-seeking is hypothetically possible even in a free market. But, without the state and its coercive monopoly to do violence on your behalf, it suddenly become much more expensive, and much more impractical, to say nothing of the reputational implications (and in this case, I mean both reputation in the layman's sense as well as the more formal game theory definition).
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No.99138
>>99131
>Isn't this essentially arguing, "We have to have good/the correct people in charge?"
If you could elaborate on how you're seeing this connection, then I would appreciate it, but as a base assumption, I don't see this at all, no. I'm saying "there are bad people and they will do these things," but I'm also making the statement that "these bad people will exist either way, but the less they can rely on the government for "legitimacy," the less harm they are capable of causing to the overall population. There might be select mountain passes where it's cheaper to pay the $2 toll than to go around the mountain or burrow a tunnel through the mountain, but those are exceptions to the rule and are more examples of "the market could be improved" rather than examples of some sort of "bad guy crisis" at hand. Capitalists, or rather "Capitalist thought experiments/literature" work on the assumption that every individual is the greediest, slimiest, most underhanded fucking bastard scumbag baby-raping motherfucker you will ever encounter, and then after we assume that everyone is a horrible person out to murder your dog, we back track and go "and here's why they don't do that/why it's not beneficial for them to do that, and thus why only people who are mentally insufficient in the head are the only ones who would do that."
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No.99142
>>99133
>Deplatforming
You do know the banking system is like 99% government ran in the US, right? Those companies only exist because the government keeps them from collapsing in on themselves while keeping out competition. Otherwise there's nothing stopping every Mr. Shekelstein in a 3 block radius from opening his own version of X bank or Y credit union.
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No.99143
>>99137
>The congressman who pushed for the Act to get passed was in fact backed by some of Rockefeller's smaller competitors, who envied his share of the market,
If I might point something out, Rockefeller only had something like a 7% market share before the Anti-Trust Acts and the competitors that filed suit against him had a combined share in the 40% range. Albeit by the time it went to trial, their respective market shares had fallen dramatically because Rockefeller, for all the bad shit he did, was intent on making sure customers got cheap oil instead of worrying about lobbying the government at the time.
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No.99144
>>99143
Aye. I didn't want to dip too far into tangents because my post was already on the long side. While Standard Oil did have a market share upwards of 90% at its peak, it was down to 60% when the Anti-Trust murmurings first started up, and it was even lower by the time the bill came into effect.
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No.99150
>>99144
And even that is misleading, since Standard Oil was a consortium, not some monolythic entity.
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No.100938
>>99129
I think there is a point that leftists are apt to look at rent-seeking and point to capitalism as the problem, and rightists are apt to look at rent-seeking and point to government as the problem. When in reality, they're both right.
You might say, "Well, the solution is NO government" (I'm looking at you >>99137), but the point is that if you already exist in a society with a government, then a lot of these critiques against capitalism make a lot of sense. I think that's what a lot of the talk in the podcast listed in the OP was getting at.
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No.100939
>>100938
>if you already exist in a society with a government, then a lot of these critiques against capitalism make a lot of sense.
Superficially, yes. But you're ignoring the cause by hyperfocusing on the symptoms. Private companies do rent-seek, but when they do so their behavior is enabled by the government; in some extreme cases, like that of Facebook, they're not just enabled by the government, they are actively subsided by the state and further its goals through their actions, acting as de facto federal agencies, but with all the benefits of a private entity. As the state is not only deficient in its ability to solve the problems of rent-seeking (due to the calculation problem and all the other reasons the state is inefficient), but it has zero incentives to stop rent-seeking, and every incentive to engage in rent-seeking itself. Therefore, even if we already exist in a society with a government, as you say, the solution is still to reduce the size and scope of the state at every turn.
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No.100945
>>100939
But it also explains why leftists are so obsessed with income inequality. If you come from the point of view of already existing in a society with a government, then buy the critiques against capitalism which make a lot of sense in that system, then an alternative approach to cracking down on rent-seeking is instead to eliminate the differential financial advantage that certain individuals have in rent-seeking, which on an institutional level would involve combating income inequality. I'm not saying whether that's a good approach, but just how it's seemingly consistent from that worldview.
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No.100956
>>100945
>if you come at the problem from the wrong direction, you only produce shitty solutions
Well, yes.
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No.100987
>>99071
>Don't firms and individuals in a capitalist society have large incentives to rent-seek, in other words, isn't it the case that cronyism an endemic feature of capitalism?
In fact, no. It's not firms per se that rent-seek, it's interest groups. These groups will exist even in a perfectly socialistic system.
Some of the worst examples of rent-seeking you can find in Nazi Germany. I recommend The Vampire Economy if you want to learn about this in depth, or at least a few chapters from it, as the book is quite boring. Corporations were very heavily regulated, they could not import or export without permission, they had to fulfill quotas, managers and entrepreneurs lived in constant fear of being persecuted for accidentally breaking some law, they had members of staff whose sole purpose was to have cocktail parties with bureaucrats… interestingly, no capitalist really liked this state of affairs. Many wanted it at first, especially the banks, but they deeply regretted it a few years later.
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No.100989
>>99128
For the love of God, just learn this already.
The reason we mock communists who say "not real communism" is because they a) have no standards for determining whether some state is communist or not, as aa) their standards, like "worker's ownership of the means of production" are nearly inoperable, and bb) they cannot even find any consensus on which standard they should adopt, and b) they regularly change their minds on which governments are and aren't socialistic. My favorite example is Venezuela. You had leftists praise this country for its policies, but they made a 180° turn once the first reports came of starving Venezuelans eating flamingoes, and then they pretended that this turn never happened once Venezuela reached a state of civil war. We were always at war with Eurasia, you know? Also, c) communist don't like to think of a spectrum running from capitalism to communism, a system is either communistic or it's capitalistic.
Meanwhile:
a) Every capitalist will agree that the more unregulated voluntary transactions and property dispositions are, the more capitalist a country is,
b) there is broad agreement over which countries are capitalistic and which aren't, with some disagreements on facts, but you at least don't have thirty sects of capitalists who disagree with each other and don't even acknowledge their differences,
c) we think of economic freedom as running on a spectrum, with the USSR on one end and Ancapistan on the other so that when we say "Chile wasn't REAL capitalism", we mean to say it wasn't the ideal type of a capitalist economy. We then usually go on to mention the features which weren't capitalistic and tell you why the economic calamities in question are the fault of the interventionist or socialist elements of the economy, not of the capitalist ones.
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No.100990
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