News Becoming a Capitalist President in El Salvador. Some advices?

[mheslep]

Irrelevant in the discussion.

In a discussion about improving economic systems facts on unemployment are hardly irrelevant. Unemployment is not the only issue, nor did I suggest it was.

 

[drankin]

Especially in the current employment market, your proposal that one could be fired without reason, warning and compensation appears particularly cruel to me.

Based on your comments it seems to me that you come from the perspective that jobs are a right or something owed to someone and cannot be taken away from them by their employer.

I disagree. If my boss were to come down here and fire me and he gave me no reason what-so-ever, I would leave and not come back or even consider legal retribution. I will not be fired, because I provide a competitive service for my employer and my employment is based on merit. Not the economy, not the law, not from some sort of social obligation. And that's the way it should be in a capitalistic society.

 

[mheslep]

Depends on how you define "free". If I have an electric car and I only plug it in at my workplace, then transportation is free for me : )

You still don't know that the car charge is free for you. You just don't directly pay for the electricity at the time of the charge. Maybe your next raise is off because the business's bottom line is off. Maybe you get laid off for the same reason, and so on.

 

[humanino]

My unemployment figures are biased?

No, but you answered to "that's a nice place to live because of healthcare and education" by quoting those numbers. The three are supposedly taken into account in the HDI which is why I mentioned it. My main point when claiming the view is "biased" was exactly that every single number is partial and the problem is more elaborated that suggested in the OP. Since we agree this is off-topic, and that the main issue here is the simplistic approach to a complicated problem as you seem to suggest in

In a discussion about improving economic systems facts on unemployment are hardly irrelevant. Unemployment is not the only issue, nor did I suggest it was.

and

You still don't know that the car charge is free for you. You just don't directly pay for the electricity at the time of the charge. Maybe your next raise is off because the business's bottom line is off. Maybe you get laid off for the same reason, and so on.

I'll just rather leave the specificities of France out of this thread.

 

[cesiumfrog]

Would be good to become the Honk Kong of Latin America(they are ranked 1 in economic freedom)

Then you should copy how Hong Kong became so. It's very easy (for your government). For more information see:
http://www.ted.com/talks/paul_romer.html"
Basically, invite a trustworthy first-class nation (like Britain, or a west-European nation) to completely govern a small region of your country for a fixed time, say 100 years. Foreign companies will want to invest their money in that region (because they will trust its stability better than anywhere else in Latin America). Many of your own people will freely move into the region, for better paying jobs and the higher human-rights standards expected from Western governance. Within a lifetime, you will have a great city that is the pride of your continent.

My country is still poor and it has a lot of social problems.

This are

-Extreme Violence.
-Poverty.
-Ignorance.
-And a lot of leftist that admire Fidel Castro and totalitarism.
-Pollutio.

We don't have to much resources , but we have people who love to work.

Some solutions:

-Open the country to foreign inverstion
-Deregulate the economy
-Privatize Important sectors
-Make the government more transparent so there be more trust in iverstion.

Things I am not sure:

-In capitalism education and healthcare are private, but in my country they are socialized in a big part. It would be smart to privatize this? Does private healthcare really works and improves quality? Full private education would be better? What happened if people can't pay?

-Enviromental regulation is good? Does is it have a place in capitalism?

Transparency is a major issue. A good idea I've heard would be to ask for foreign bodies to send teams of their accountants into your country. They can help you get rid of corruption. Once corruption is gone, your country will be naturally more productive, and foreign investors will no longer be as afraid to invest more capital into your economy.

It is not smart to completely privatise education or healthcare. Both are socialised in "first world" countries. (In the past, some people traveled from the USA to Cuba to get better health care.) Likewise, environmental regulation is important (for capitalism, the term is "externalities". If no single person has ownership of the environment, then regulation is always necessary). The countries with the highest living standards are all capitalist countries, but tempered with social welfare institutions and market regulations, this is all compatible.

There is a number of organisations that have done lots of research into ways of best improving countries where the living standard is comparatively low. You should try to make use of their expertise. I'd say you want to be looking to the type of people that are invited to TED, and invite them to you.

 

[AlexES16]

It has to do with capitalism in that only in true capitalistic environment can this be practiced. And I don't find it unacceptable. If a worker does not like the conditions of his/her employment they are free to find work elsewhere. In this situation an employer may have to reconsider the hiring standards in order to retain employees and remain competitive in a given market.

Thats my point =)

 

[AlexES16]

Then you should copy how Hong Kong became so. It's very easy (for your government). For more information see:
http://www.ted.com/talks/paul_romer.html"
Basically, invite a trustworthy first-class nation (like Britain, or a west-European nation) to completely govern a small region of your country for a fixed time, say 100 years. Foreign companies will want to invest their money in that region (because they will trust its stability better than anywhere else in Latin America). Many of your own people will freely move into the region, for better paying jobs and the higher human-rights standards expected from Western governance. Within a lifetime, you will have a great city that is the pride of your continent.



Transparency is a major issue. A good idea I've heard would be to ask for foreign bodies to send teams of their accountants into your country. They can help you get rid of corruption. Once corruption is gone, your country will be naturally more productive, and foreign investors will no longer be as afraid to invest more capital into your economy.

It is not smart to completely privatise education or healthcare. Both are socialised in "first world" countries. (In the past, some people traveled from the USA to Cuba to get better health care.) Likewise, environmental regulation is important (for capitalism, the term is "externalities". If no single person has ownership of the environment, then regulation is always necessary). The countries with the highest living standards are all capitalist countries, but tempered with social welfare institutions and market regulations, this is all compatible.

There is a number of organisations that have done lots of research into ways of best improving countries where the living standard is comparatively low. You should try to make use of their expertise. I'd say you want to be looking to the type of people that are invited to TED, and invite them to you.

Great information. Something like a regulated capitalism but still capitalism.

But i don't see how to build a city in such a small country like mine.

 

[CRGreathouse]

In my understanding it is the same measurement in the US. The difference with employment-to-population ratio is known, and monitored. It is all available
http://www.bls.gov/webapps/legacy/cpsatab1.htm

I'm familiar with the workforce participation rate and its difference from the unemployment rate and the ratio of employed persons to (persons in the workforce + discouraged workers). But the post I replied to suggested that, in France at least, the unemployment rate could be (artificially) reduced by reducing the number of people on the welfare rolls, and this is of course different from excluding discouraged workers or institutionalized persons, etc.

 

[cristo]

If my boss were to come down here and fire me and he gave me no reason what-so-ever, I would leave and not come back or even consider legal retribution. I will not be fired, because I provide a competitive service for my employer and my employment is based on merit.

This is a very naive view. Are you saying you'd be happy if in, say, 10 years you were fired and replaced with a youngster that the company only has to pay a fraction of your wage?

 

[vertices]

Some solutions:

-Open the country to foreign inverstion
-Deregulate the economy
-Privatize Important sectors
-Make the government more transparent so there be more trust in iverstion.

There is strong empirical evidence that such policies would make things much, much worse for your nation.

 

[Gokul43201]

This is a very naive view. Are you saying you'd be happy if in, say, 10 years you were fired and replaced with a youngster that the company only has to pay a fraction of your wage?

(not speaking for drankin, but ...) I, personally, wouldn't be happy with myself, if I haven't, in 10 yrs, made myself worth a lot more than a youngster new to the job. Nor would I be happy knowing that the only reason I haven't lost my job to a capable youngster is that it is mandated by some higher power that I not be fired, irrespective of my worth to my employer.

There is strong empirical evidence that such policies would make things much, much worse for your nation.

When you make a statement like that, it behooves you to provide said evidence.

 

[Pythagorean]

You still don't know that the car charge is free for you. You just don't directly pay for the electricity at the time of the charge. Maybe your next raise is off because the business's bottom line is off. Maybe you get laid off for the same reason, and so on.

Ok, I agree with you; that's a possibility...

But that still doesn't mean that "there's no such thing as a free lunch" is a true assertion. Because, following your method of inserting convenient exceptions, I *could* work for a company whose stock expenses are so high that it's electricity bill is considered pocket change no matter how much it fluctuates, and never factors into wage budgeting. Or I *could* frame someone else for stealing the power in some other way and earn a raise faster, killing two birds with no stones.

 

[AlexES16]

(not speaking for drankin, but ...) I, personally, wouldn't be happy with myself, if I haven't, in 10 yrs, made myself worth a lot more than a youngster new to the job. Nor would I be happy knowing that the only reason I haven't lost my job to a capable youngster is that it is mandated by some higher power that I not be fired, irrespective of my worth to my employer.


When you make a statement like that, it behooves you to provide said evidence.

Thats good, capitalism really make you be better.

 

[AlexES16]

This thinking is good about how the internet is the closest to a free market capitalism.

 

[drankin]

This is a very naive view. Are you saying you'd be happy if in, say, 10 years you were fired and replaced with a youngster that the company only has to pay a fraction of your wage?

Naive? That's life son. If I've been there ten years and some newby kid can just show up and do my job as well as me for half my pay, then I deserve to be replaced. I am no longer being competitive in the work force. That's capitalism. It would not hurt my feelings if it happened today! It would motivate me to work even harder at my professional game. My work is worth what the market determines. If I don't like it it's my prerogative to adapt and increase my worth in the market as required. Noone owes me a job.

And the adults who don't get these concepts still live in their moms bacement.

 

[drankin]

Thats good, capitalism really make you be better.

Bingo. It really does force a person to work hard and continually improve ones self.

 

[vertices]

When you make a statement like that, it behooves you to provide said evidence.

Take Chile, under Pinochet (the posterboy for free market fundamentalism), for example. That country was left in ruins by the time he was ousted.

 

[humanino]

Naive? That's life son. If I've been there ten years and some newby kid can just show up and do my job as well as me for half my pay, then I deserve to be replaced.

What if your company can just close doors, leave everybody behind and relocate in China ? No compensation, you are not even told in advance. How would you feel about that ? In your view, would not that kind of behavior be an optimal organization for modern capitalist societies ?

/And the adults who don't get these concepts still live in their moms bacement.

I do not agree with you, yet I can spell mom's basement.

It really does force a person to work hard and continually improve ones self.

I'm sorry but those are all theoretical arguments not reflecting reality. You know, Hitler improved the productivity in Germany and was quite efficient at forcing people to "continually improve themselves". He just disregarded human rights to achieve that.

 

[drankin]

What if your company can just close doors, leave everybody behind and relocate in China ? No compensation, you are not even told in advance. How would you feel about that ?

You keep asking people how they would "feel". As if the world is run by regarding everyones "feelings". Quit making up scenarios and asking my how I would "feel". But, to answer your question, I would "feel" like getting another job.

I do not agree with you, yet I can spell mom's basement.

Did I hit a nerve? In your case we'll just call her momma.

I'm sorry but those are all theoretical arguments not reflecting reality.

Theoretical? I'm being payed in the market place that I've worked in for 20yrs theoretically?. And you pulled the Hitler card? Really?

I hope you are paying your mom some rent.

 

[humanino]

...

I do not live in my mother's basement, I left home after high-school and you did not hit any nerve. I just remain convinced that you are not being helpful to AlexES16 by describing concepts of capitalism which are not real. The well-being of employees and their human rights are an important ingredient in our modern societies. I think the recent crisis also illustrates this idea.

edit
It is not about the Hitler's card. It is about illustrating that your argument in favor of a wild imaginary capitalism (It really does force a person to work hard and continually improve ones self.) is not a helpful one.

 

[drankin]

I do not live in my mother's basement, I left home after high-school and you did not hit any nerve. I just remain convinced that you are not being helpful to AlexES16 by describing concepts of capitalism which are not real. The well-being of employees and their human rights are an important ingredient in our modern societies. I think the recent crisis also illustrates this idea.

edit
It is not about the Hitler's card. It is about illustrating that your argument in favor of a wild imaginary capitalism (It really does force a person to work hard and continually improve ones self.) is not a helpful one.

What human rights are you referring to that you seem to think that what I am saying is violating??

 

[AlexES16]

Take Chile, under Pinochet (the posterboy for free market fundamentalism), for example. That country was left in ruins by the time he was ousted.

Dude you realize that Chile is best country in Latin America?

http://en.wikipedia.org/wiki/List_of_countries_by_Human_Development_Index


http://www.heritage.org/Index/Country/Chile

 

[AlexES16]

I was thinking in Environmentally Regulated Capitalism.

 

[AlexES16]

In my school i am debating with socialist every moment.

Their strong points are(they win a lot of support with this):

-Enviroment
-Healthcare
-Education

 

[humanino]

What human rights are you referring to that you seem to think that what I am saying is violating??

Referring to "human rights" might be borderline, what I had in minds is

1) Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment.
[...]
3) Everyone who works has the right to just and favourable remuneration ensuring for himself and his family an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection.

If a business owner can fire anybody as they please, then it will be hard to have the right to work and to a just remuneration.

 

[drankin]

Referring to "human rights" might be borderline, what I had in minds isIf a business owner can fire anybody as they please, then it will be hard to have the right to work and to a just remuneration.

This is where we differ completely. Work is not and should not ever be a "right". It is contrary to the competitive nature of capitalism. It offers no incentive for an individual to be competitive in the workplace and therefore improve the competitveness of the company product as it leverages its supply and demand in the market. What you are pitching is not capitalism, it is socialism.

 

[loseyourname]

In my school i am debating with socialist every moment.

Their strong points are(they win a lot of support with this):

-Enviroment
-Healthcare
-Education

They're simply failing to recognize that nations with market economies still need means of dealing with public goods and other instance of market failure. That's why we require publicly owned corporations to comply with FASB accounting standards and release publicly available annual reports, because information symmetry is a foundation of competitive markets and they won't function as well without it. It's also why we regulate things like water pollution, because otherwise, someone downriver bears the cost of a production activity aside from the consumers and producers of the good, creating negative externalities and market failure. Education and many facets of healthcare (like vaccines) exhibit very clear positive externalities and so the government subsidizes them to bring the market back to an efficient equilibrium.

Your friends are just committing the economic version of Galton's Error. Capitalism doesn't mean all-or-nothing we don't provide public goods or correct market failures. It's just a commitment to the notion that many heads are better than one and individual consumers and producers know their own preferences and utility expectations better than a central planning committee does.

 

[humanino]

This is where we differ completely.

It may be, but I would like to understand your point of view better. When you say

the competitive nature of capitalism.

You certainly do not say capitalism and competition are equivalent. Do you mean to say that capitalism implies competition, or that competition implies capitalism ? This really confuses me, to me there is no reason they should be related a priori. They may come together, they may come separately, there is no necessity in the relationship between them.

To me capitalism is a social organization aiming at maximizing private profit. I agree that competition is constructive in a capitalist society, but I do not see why it should be a necessary ingredient.

What you are pitching is not capitalism, it is socialism.

I do not think so, but maybe from your perspective. From my perspective, socialism and capitalism are not even contradictory. Communism is contradictory to capitalism.

 

[drankin]

Here is one of a few definitions via dictionary.com:

World English Dictionary
capitalism (ˈkæpɪtəˌlɪzəm)

— n
Compare socialism free enterprise , Also called: private enterprise an economic system based on the private ownership of the means of production, distribution, and exchange, characterized by the freedom of capitalists to operate or manage their property for profit in competitive conditions.

 

[loseyourname]

To me capitalism is a social organization aiming at maximizing private profit. I agree that competition is constructive in a capitalist society, but I do not see why it should be a necessary ingredient.

Actually, economic profit at equilibrium in a pure competition model is zero. What competitive markets maximize is called net social surplus, a sum of consumer's surplus and producer's surplus. This sum is maximized when both components are equal. Profits exist when producer's surplus is larger than consumer's surplus, keeping net social surplus at a less than optimal sum, and this situation can only persist in the absence of competition. That's precisely why competition is so important to capitalism. The use of mechanisms (usually political favoritism) to intentionally subvert competition to cause either consumer's or producer's surplus to persist in excess of the other quantity is called "rent-seeking" and is a cardinal sin of a market economy.