[slackline]

To expand on why I refernced evolution (was due to leave work & head to the wall earlier which is why I wrote little)...

We are animals and have been subject to the basic law of survival of the fittest which leads to evolution by natural selection.  At a fairly basic level this is how we're still playing the same game, businesses grow/evolve too, those that respond to changes in the market the quickest will "win"... in the short term in terms of maximising their profit, longer term the priorities that define what is successful may well change.  Humans have the ability to make some educated guesses/predictions about the future based on observing and understanding the world around us which makes it possible to break out of this.

I'm not so stupid as to think that profits are "a bad thing" and should be avoided, as you say Sloper there are benefits as it allows reinvestment.  But as Sasquatch has rightly said, its not just about money when you weigh up costs and benefits.  There are long term environmental issues that the planet, not nations on their own, have to face upto.  Attempts to stiffle these efforts now in favour of short term financial gains (as seems to be part of the aim of TAFTA that I originally linked to) is in my opinion myopic and why I made the slightly facetious comment about it.

The US have for along time avoided things such as the Kyoto Protocol and this TAFTA appears to be in a similar vein.

If as a species we can "[evolve] multi jurisdictional systems and control" that move us away from short term financial profit maximisation that takes into account all the costs and benefits that activities incur then that would in my opinion be a good thing.

[Sasquatch]

One of my favorite things about adam Smith is his ability to see both sides of the evolution of business.  The combination of Wealth of Nations with Theory of Mortal Sentiment make a compelling case for a viable long-term capitalistic society.  The problem is that many people follow one(WON) and exclude the other, which is not viable in the long run. 

 

 

[andy popp]

Good post Slackline.

[DaveC]

It strikes me there is another great thread starting in the last dozen or so posts on here.

PS Andy, I'm reassured to find that you think  Ayn Rand was mad but I still worry as to why you make your students read her! 

[Stubbs]

Don't split it or before you know it people will be talking about the Gold Standard and how governments already have too much control over companies etc etc.

Back to some newsy news, a drone video from Kiev yesterday

[psychomansam]

It strikes me there is another great thread starting in the last dozen or so posts on here.

I can split it off if people want. Care to suggest a title? The trouble is that it may suck me in, then I'll write a long post explaining how most large companies are predominantly owned by ordinary individuals through their pension and saving funds, that corporate profit is intrinsic to allowing those funds to provide the long-term return that underpins those pensions and savings and that otherwise we'd be stuck in the model that the public sector use for pension provision which is typically based on unfunded IOUs or a ponzi scheme of current employees paying out for current retirees. And I don't want to do that as know the asinine replies that will provoke will push me perilously close to a terminal flounce where I switch off the server and redirect the UKB url to the Von Mises Institute. Just saying ...



Ah yes, so promoting corps is about promoting the interests of the middle classes? At the expense of those without (decent) pensions? I'm not at all sure that's either an accurate depiction or a valid defence.
Economic issues aside, I think the deeper issue is the undemocratic nature of allowing the corps to bully, bias, buy and undermine democratic processes and government.
 

[andy popp]

PS Andy, I'm reassured to find that you think  Ayn Rand was mad but I still worry as to why you make your students read her! 

I teach a course on Corporate Social Responsibility - though it isn't really, more a philosophica/historical perspective on the corporation as an institution. One major thread is around understandings of self-interest; from Hobbes through Smith (Moral Sentiment and Wealth of Nation), through to Friedman and Rand. Rand may seem genuinely insane to many of us but she continues to have a huge influence. She had a major impact on many Silicon Valley entrepreneurs during the 90s and Alan Greenspan was a member of her inner circle for many, many years. If you can get hold of it there is a great documentary series called 'All Watched Over by Machines of Loving Grace' - episode one focuses on Rand and the dot.com bubble. I'd add I don't make them read the novels (which I haven't read, very impressed Habrich has managed Atlas Shrugged).

[andy popp]

I can't remember names of the top of my head - I'll do some digging if I get a chance.

[Johnny Brown]

All Watched Over by Machines of Loving Grace

Well worth seeing this, I think it was on the 'must watch' thread at the time.

[Wood FT]

Thanks for posting, thoroughly enjoyed it first time round. I remember seeing a video by someone somewhere (yes) that deconstructed the Adam Curtis (arguably) manipulative style. But I don't care I love it, as some great philosophers once said

[andy popp]

Thanks Adam.

I don't think its manipulative, it has a position and an argument, one many will disagree with probably - but it makes absolutely no bones about that. Its a provocation, there to be reacted to.

[Wood FT]

I don't think its manipulative, it has a position and an argument, one many will disagree with probably - but it makes absolutely no bones about that. Its a provocation, there to be reacted to.

me neither, it stirs something.

anyway, here's that video I think. Apologies if it's the wrong one I can't view tubeyou at work.

[mrjonathanr]

Thanks Adam.

I don't think its manipulative, it has a position and an argument, one many will disagree with probably - but it makes absolutely no bones about that. Its a provocation, there to be reacted to.

A bit like Sloper, till you use the mute button.

[Sloper]

the point is without the pursuit of profit then many of the wonderful by products of capitalism (as you say the development of law & etc) will not occur.

Just because things lead to advancements in civilisation in the past doesn't make them right for our current situation.  I'm sure you can come up with your own examples.

Sorry but I don't see what you're driving at, are you suggesting that for example, the www would have developed as it has without the search for profit?

[Sloper]

To expand on why I refernced evolution (was due to leave work & head to the wall earlier which is why I wrote little)...

We are animals and have been subject to the basic law of survival of the fittest which leads to evolution by natural selection.  At a fairly basic level this is how we're still playing the same game, businesses grow/evolve too, those that respond to changes in the market the quickest will "win"... in the short term in terms of maximising their profit, longer term the priorities that define what is successful may well change.  Humans have the ability to make some educated guesses/predictions about the future based on observing and understanding the world around us which makes it possible to break out of this.

I'm not so stupid as to think that profits are "a bad thing" and should be avoided, as you say Sloper there are benefits as it allows reinvestment.  But as Sasquatch has rightly said, its not just about money when you weigh up costs and benefits.  There are long term environmental issues that the planet, not nations on their own, have to face upto.  Attempts to stiffle these efforts now in favour of short term financial gains (as seems to be part of the aim of TAFTA that I originally linked to) is in my opinion myopic and why I made the slightly facetious comment about it.

The US have for along time avoided things such as the Kyoto Protocol and this TAFTA appears to be in a similar vein.

If as a species we can "[evolve] multi jurisdictional systems and control" that move us away from short term financial profit maximisation that takes into account all the costs and benefits that activities incur then that would in my opinion be a good thing.

It was (I think) Professor Coarse (sp) who suggested that the model for environemntal law made it more expensive to pay the fines for polluting than the costs of not polluting, which was aggressively applied in the US Courts, hence the categorical difference between the way that waste was dealt with in the US vs the (old) USSR.

[Sasquatch]

the point is without the pursuit of profit then many of the wonderful by products of capitalism (as you say the development of law & etc) will not occur.

Just because things lead to advancements in civilisation in the past doesn't make them right for our current situation.  I'm sure you can come up with your own examples.

Sorry but I don't see what you're driving at, are you suggesting that for example, the www would have developed as it has without the search for profit?

The problem with this is that there is no counterfactual.  Didn't the www initially develop as a means of sharing information and collaborating amongst college researchers.  I'd argue that the www was exploited by capitalism, but not responsible for it's creation.  I think its actually quite rare for capitalism to actually provide true innovation at a higher scale than socialism.  It seems to me the big difference is in the post innovation stage.  Capitalism has much greater capacity for expanding the scope of innovation, but it could be debateable if this is a good thing.  Personally I think it is generally a positive as long as the competition remains.  When the barriers to entry or large players consistantly crush/buy out competition, then the average consumer inevitably suffers...

[Johnny Brown]

Good post. I must admit I watched it with a certain degree of scepticism, born of it being one thread pulled from a clearly tangled mass. But as a piece of TV I thought it was great and to be applauded - up there with Meades' stuff. With both I think that there is an implicit understanding that this is one man's view (albeit learned) not THE TRUTH.

[andy popp]

Thanks Toby, that was a really great post - I'd love to talk to you more about your experiences in Silicon Valley one day. Like I said, the film is a provocation ... and it worked to provoke your response. If I use part of this in the classroom, and I do sometimes, then of course I don't leave it simply to speak for itself. We'll also explore the unintended consequences of enlightened self-interest (from Smith), the enormours innovative power of capitalism's creative destruction (from Schumpeter) and certainly we also address the complexities of corporate philanthropy, from Owen, through Carnegie (an enormously complex, ambigous figure) to Gates and Buffett.

That said, I think there are points to be argued in your reply. I'm not sure opinion on the real extent and sources of productivity gains in the 90s is so settled as you suggest and the role of massively increased computing power in the current financial crisis is hard to underestimate. I don't think he really presents a conspiracy theory so much as a picture of mess and complexity.

Still, like I said, great, thoughtful post.

[Sloper]

the point is without the pursuit of profit then many of the wonderful by products of capitalism (as you say the development of law & etc) will not occur.

Just because things lead to advancements in civilisation in the past doesn't make them right for our current situation.  I'm sure you can come up with your own examples.

Sorry but I don't see what you're driving at, are you suggesting that for example, the www would have developed as it has without the search for profit?

The problem with this is that there is no counterfactual.  Didn't the www initially develop as a means of sharing information and collaborating amongst college researchers.  I'd argue that the www was exploited by capitalism, but not responsible for it's creation.  I think its actually quite rare for capitalism to actually provide true innovation at a higher scale than socialism.  It seems to me the big difference is in the post innovation stage.  Capitalism has much greater capacity for expanding the scope of innovation, but it could be debateable if this is a good thing.  Personally I think it is generally a positive as long as the competition remains.  When the barriers to entry or large players consistantly crush/buy out competition, then the average consumer inevitably suffers...

As I understand it many of the drivers of the development of the web had their genisis in gambling and p0rn as these were the two areas which had achievable short term goals of drawing in funds and operating at a profit.

You might say that print media didn't arise solely to turn a proft, but if we look at the development of print media 9excepting politics and religion which were substantial drivers) the vast majority of innovations were to earn profit or increase profitability.

As to barriers to entry, you will of course be aware of the stringent 'anti trust' laws in the USA (and to a lesser degree in the EU), whether these have be effective as intended or could be more so is open to detabe: however for there to be an effective cartel you need the state 9or a body with similar restrictive powers  e.g. guilds) to be an active agent, and this is lacking in the area under discussion.

[Sasquatch]

As I understand it many of the drivers of the development of the web had their genisis in gambling and p0rn as these were the two areas which had achievable short term goals of drawing in funds and operating at a profit.

Once again, this came in the exploitation(not a negative term) phase not during the innovation.  Same as Amazon, EBay, etc.     

You might say that print media didn't arise solely to turn a proft, but if we look at the development of print media 9excepting politics and religion which were substantial drivers) the vast majority of innovations were to earn profit or increase profitability.

I'd argue that very few of those were actually "innovation", but that becomes a little bit semantic.  To me Gutenberg's press was innovation.  Industrial revolution(factory line mass production) was innovation. The PC was innovation.  In between was mainly tweaks and exploiting the innovation for profit.  Once again.  I don't think this is a bad thing, just that to me Capitalism doesn't drive innovation, but is exceptional at expanding the scope of use and exploiting it for profit which is generally a good thing and has been a historically great thing!  My concern with it now is that with the rise of massive multinational corporations with the same rights as an individual (at least in the US) there is no governing body that can hope to assert control over these entities.  That scares me, and I'm hopeful a solution will be found. 

As to barriers to entry, you will of course be aware of the stringent 'anti trust' laws in the USA (and to a lesser degree in the EU), whether these have be effective as intended or could be more so is open to detabe: however for there to be an effective cartel you need the state 9or a body with similar restrictive powers  e.g. guilds) to be an active agent, and this is lacking in the area under discussion.

Which area is that?  The web?

[Sloper]

Sorry, but if you think that the desire for profit doesn't drive innovation; for example on the web, the innovation that allows for payment via web services then I don't think there's a lot I can add.

As for these giant mulitnationals like micrsoft, apple, facebook google, how do you think they started off?

[Oldmanmatt]

Sorry, but if you think that the desire for profit doesn't drive innovation; for example on the web, the innovation that allows for payment via web services then I don't think there's a lot I can add.

As for these giant mulitnationals like micrsoft, apple, facebook google, how do you think they started off?

I can see both sides here.

However, few inventors seem to make a fortune from their endeavours; though many an entrepreneur has capitalised on the initiative of others. It is hard to not see that exploitation as innovation in its' own right.

But then, perhaps as an Engineer, I've just grown accustomed to re-applying the ideas of others to different contexts.

After all, Mr Gates et al, may have developed the PC but they in turn merely (?) reapplied the micro chip technology, that was in itself a reapplication of Transistor technology, that was a reapplication of Thermionic Valve technology, that really did the same thing that a servo fluid system could do, and they were really just reimagined mechanical Governors, that were just souped up....

[Sasquatch]

Sorry, but if you think that the desire for profit doesn't drive innovation; for example on the web, the innovation that allows for payment via web services then I don't think there's a lot I can add.

As for these giant mulitnationals like micrsoft, apple, facebook google, how do you think they started off?

As I said before, it becomes all a bit semantic, but no, I don't think most innovation is derived from a purely profit motivation.  I think it's derived more form curiosity and exploration.  I DO however think that capitalism is very good at taking an innovation and broadening the scope of application to the point that something becomes widely available.  I think capitalism and the drive for profit has driven down the price of almost every good and service consumed on the planet. 

Actually if you look at the way Google deals with employees, you'll see the same thing.  They understand that true innovation stems from creativity, and they encourage(almost require) their employee to work on personal projects for a certain amount of their time.  Knowing that real breakthroughs come not from a drive to innovate, but from curiosity.  From the question-is it possible, can i do that?  What google has done, and most of silicon valley, is to take a creative idea, and figure out how to make it profitable.  Mostly not the otherway around.   If you read about the story of facebook, it wasn't created to be profitable or make money.  That came as an after effect.  Neither was Google for that matter.  Money was not the goal.  It came after the innovation.

What innovation on the web allows for payment via web services?  You mean credit card usage which was available long beforehand through mail order catalogues?  All most companies did was move their catalogue online, and eliminate the need to call in.  I don't see that as really innovative. I see that as a tweak to increase profitability and decrease cost of goods. Perhaps if you're talking bitcoin, although it's yet to be determined if that will continue and be successful.

None of this is meant to attack capitalism.  Capitalism sets the stage that allows innovation to fourish after the fact.  Perhaps its a chicken and egg arguement, and you say chicken and I say egg.

[slackline]

I do not believe making money in order to consume goods is mankind's sole purpose on this planet.

[slackline]

Just had to check my calendar to make sure its not 1^st April today...


Conservatives re-brand as "Workers' Party"