Romney

[eddie_dane]

Originally Posted by DXR_13KE

Why the atheist hate? I would figure it would be a positive trait for a government that should and must be separate from religion.

Not preferring someone in an election does not equal "hate".

The constitution states that the government may not establish a religion nor prohibit the free exercise of one. When people want Christmas trees in public places it's contended by atheists. Other than that, Americans don't give atheists much thought much less "hate". ~ and I live in a very religious area of the country.

It doesn't help the atheists much when debating religion, they often reduce people's beliefs to either a mental deficiency or an emotional/mental disorder. I have many atheist friends/family members and it is a non-issue. I don't think my experience is very unique.

[Er-El]

Originally Posted by Nexxo

And again, that is a nice ideal but not a reflection of reality. Certain choices are not really a choice, and where there is deliberate asymmetry of information there is fraud. These issues which are central to the whole notion of a free market are common occurrences and there are no inherent checks or balances in capitalism.

Just claiming that this is how it works in principle does not make it a reality.

It's easily illustrated too.

Originally Posted by Nexxo

So people acting as a group would behave in exactly the same way as individuals?

It doesn't change the crime of each individual that make up that group. They made the decision to participate.

Originally Posted by Nexxo

It is way more complicated than that. But given that most people operate morally on a social approval basis (it's good when society approves; it's bad when society disapproves) there is most definitely a relationship between political systems and how people behave morally.

Yes, social ostricism is pretty effective in enforcing morality and revealing where it lies. Still no contradictiont here.

Originally Posted by Nexxo

And of course banks, if left to it, don't fix Libor rates.

Not really, no, they can't. Remember, who supplies the money, sets the reserve ratio, and fixes the interest rates? It's not a market regulated by supply/demand, profit and loss.

Originally Posted by Nexxo

Companies don't price fix?"

They have tried, but time and time again in the right conditions it has historically been shown to work against them.

Originally Posted by Nexxo

Big Pharma does not hide bad test results. I could go on too. Just because government control is dumb, inefficient or corrupt does not mean that no control is better. If you wind back to the Victorian age for a good look, you might see why we have labour laws, health and safety laws, food and drug quality controls and building regulations, utility regulations and health care regulations. You are taking an awful lot of this for granted, chugging away behind the scenes to make your life safer and healthier, and it all exists because experience has shown us that you can't trust a free market to regulate itself.

I'm sure you can, and a lot of it has been debunked, and are easily refuted when you inspect each issue more closely. Such as the famous Victorian age argument that is always brought up, surrounded with common misconceptions, some of which are half-truths, some completely false.
I suppose in your reality workers in the Victorian age faced a massive decline in work conditions when it otherwise could been avoided, and willingly made the decision to travel hundreds of miles to endure them, and there was no upwards trend it only continued to get worse. (Nevermind that you can't really endure a degradation in work conditions if you'd be dead from starvation.) And it was way in advance of the industrial revolution's end that politicians finally had the sense to correct this sudden, long lasting nightmare and there was a lightswitch moment when the workers attained the 20th-21st century lifestyle that their employers had already enjoyed for so long.

Originally Posted by Nexxo

You are a bit like people who moan about paying taxes while they are walking down rubbish-free, well-lit streets at night in relative safety. You don't quite realise what a true unregulated free market looks like in the raw.

You are so right.

[Nexxo]

Originally Posted by Er-El

It doesn't change the crime of each individual that make up that group. They made the decision to participate.

That's not the trust of our debate. You argue that human systems cannot be moral; only individuals' actions. I'm arguing that human systems are basically just a bunch of humans acting in relationship to each other, so if human actions have a moral dimension, so do the actions of human systems.

By the way: banks fixing the Libor rate.

Companies fixing prices.

Big Pharma hiding negative test results.

Carry on...

Originally Posted by Er-El

I'm sure you can, and a lot of it has been debunked, and are easily refuted when you inspect each issue more closely. Such as the famous Victorian age argument that is always brought up, surrounded with common misconceptions, some of which are half-truths, some completely false.
I suppose in your reality workers in the Victorian age faced a massive decline in work conditions when it otherwise could been avoided, and willingly made the decision to travel hundreds of miles to endure them, and there was no upwards trend it only continued to get worse. (Nevermind that you can't really endure a degradation in work conditions if you'd be dead from starvation.) And it was way in advance of the industrial revolution's end that politicians finally had the sense to correct this sudden, long lasting nightmare and there was a lightswitch moment when the workers attained the 20th-21st century lifestyle that their employers had already enjoyed for so long.

Not at all. I'm talking more about what you could find in a Victorian loaf of bread, for example. I'm talking about child labour (buying a child from a destitute family being more economical than buying chimney sweeping equipment that would obviate sending an urchin up the chimney). Stuff like that.

Originally Posted by Er-El

You are so right.

You are sounding so petulant. We don't have to agree, but we don't have to get emotive about it.

[DXR_13KE]

Originally Posted by eddie_dane

Not preferring someone in an election does not equal "hate".

Hate was a strong word to use, i should have used "dislike".

Originally Posted by eddie_dane

When people want Christmas trees in public places it's contended by atheists.

Seriously?

edit:

Originally Posted by Er-El

"Companies don't price fix."

...in an utopia.

[eddie_dane]

Originally Posted by DXR_13KE

Hate was a strong word to use, i should have used "dislike".
Seriously?

I do realize that I was being a bit literal but this is my overall point in answering your question. I think that even "dislike" is misguided, perhaps "disagree with" might be better. But realistically, the VAST majority in the US are not actively antagonistic toward atheists, they just think they are the personification of the erosion of a Christian culture when it is up for discussion in public forums. Day to day, people don't give them a second thought.

My motives for singling out the word usage is that it is a common thing today in the US (and probably elsewhere) to label people with the word "hate" when they simply oppose. A similar scenario is labeling people as "racists" for opposing Obama. That happens a lot.

Yes, there is a strong evangelistic strain of Christians in the US that are primarily concerned with the salvation of others. But those people focus on other Christians more than they do with atheists.

Religion and Government are remarkably segregated from each other, unfortunately, Religion and Politics are horribly tangled.

[Er-El]

Originally Posted by Nexxo

That's not the trust of our debate. You argue that human systems cannot be moral; only individuals' actions. I'm arguing that human systems are basically just a bunch of humans acting in relationship to each other, so if human actions have a moral dimension, so do the actions of human systems.

I'm arguing that political systems that are centred around a democratic and legislative process is in direct contrast to how humans normally behave with each other.

Originally Posted by Nexxo

Not at all. I'm talking more about what you could find in a Victorian loaf of bread, for example. I'm talking about child labour (buying a child from a destitute family being more economical than buying chimney sweeping equipment that would obviate sending an urchin up the chimney). Stuff like that.

Just as I am too. There are endless questions on this subject, with topics that we could go back and forth on forever, but I can't prove Physics in a single forum thread when people spend years studying the subject. What I can do however is highlight the fact that there are some common misconceptions around the historical topics you bring up and encourage you revisit each of them, and get a free-market advocate's perspective on it. I'm sure you don't naively believe that people who have put hundreds of hours of research into any one of them are ignorant of the points you bring up or just apathetic about it.
Also buying and selling children is slavery and therefore not a free-market transaction and therefore parents should be liable for it rightly so. I am not defending the policies in the Victorian age either.

Originally Posted by Nexxo

You are sounding so petulant. We don't have to agree, but we don't have to get emotive about it.

No fret meant trust me. I merely found it odd that you can presume so much ("you are bit like peoplewho moan about...") based on the points I argue. I have mentioned many times where I agree and disagree, and admittedly you have helped me develop some areas of my thought. The way in which I refuted your points is no different to what's often witnessed here of yourself and everyone with no malicious intent. Sorry if the sarcasm in that line came across too strong there I guess

[Er-El]

Originally Posted by Nexxo

By the way: banks fixing the Libor rate.

Companies fixing prices.

Big Pharma hiding negative test results

Already been addressed. Look above, or here:

"Not really, no, they can't. Remember, who supplies the money, sets the reserve ratio, and fixes the interest rates? It's not a market regulated by supply/demand, profit and loss."

"They have tried [price fixing], but time and time again in the right [free marlet] conditions it has historically been shown to work against them."

[Nexxo]

Originally Posted by Er-El

I'm arguing that political systems that are centred around a democratic and legislative process is in direct contrast to how humans normally behave with each other.

Just as I am too. There are endless questions on this subject, with topics that we could go back and forth on forever, but I can't prove Physics in a single forum thread when people spend years studying the subject. What I can do however is highlight the fact that there are some common misconceptions around the historical topics you bring up and encourage you revisit each of them, and get a free-market advocate's perspective on it. I'm sure you don't naively believe that people who have put hundreds of hours of research into any one of them are ignorant of the points you bring up or just apathetic about it.
Also buying and selling children is slavery and therefore not a free-market transaction and therefore parents should be liable for it rightly so. I am not defending the policies in the Victorian age either.
No fret meant trust me. I merely found it odd that you can presume so much ("you are bit like peoplewho moan about...") based on the points I argue. I have mentioned many times where I agree and disagree, and admittedly you have helped me develop some areas of my thought. The way in which I refuted your points is no different to what's often witnessed here of yourself and everyone with no malicious intent. Sorry if the sarcasm in that line came across too strong there I guess

Eddie Dane has a vastly greater knowledge on that issue and indeed pointed out that many improvements that came out of the industrial revolution were instigated by individual or commercial enterprises before governmental reform came along. Nevertheless many individual reformers were motivated by religious beliefs and law also had its role to play, as it has today. Free market principles were not enough.

Perhaps I sounded too judgemental when I drew the parallel between your position and that of moaning tax payers. I'm trying to say that a lot of what appears to work in capitalism has a firm helping hand from governmental and legal regulation. Sorry for the clumsy phrasing.

[Nexxo]

Originally Posted by Er-El

Already been addressed. Look above, or here:

"Not really, no, they can't. Remember, who supplies the money, sets the reserve ratio, and fixes the interest rates? It's not a market regulated by supply/demand, profit and loss."

"They have tried [price fixing], but time and time again in the right [free marlet] conditions it has historically been shown to work against them."

It is always the law that catches up with them, not market forces.

[Elton]

Originally Posted by Nexxo

It is always the law that catches up with them, not market forces.

This has been the case more often than not. Look at data rates for mobile phones.

[eddie543]

Originally Posted by Da_Rude_Baboon

My interest in economics began when I wanted to find out what caused the recent financial meltdown.

Now I have read more about them the more I realise what a major part government intervention into the housing market played in creating the bubble.

In the US, the housing market had effectively self regulated itself with out issues for decades until government intervention in the name of "affordable-housing" created the sub-prime bubble. The bonds and securities created from the sub-prime mortgages were traded on Wall street and spread the fallout from a localised housing bubble onto the global markets. Sub-prime mortgages and the investments created from them were a new invention and were there fore hard for the rating agencies to accurately assess. Looking at the history of conventional mortgages and the data available at the time on sub-prime foreclosures and delinquincies they looked to be safe investments, especially as they were backed by Fannie and Freddie who were in turn backed by the US treasury (and were exempt from the financial rules and regulations private institutions had to adhere too). There are hundreds of rating agencies in the US but only three were authorised by the SEC so with no competition there is less need to innovate and develop new models of assessing risk. A salient example of government regulation interfering with the free market.

My interest in economics came about when property prices were going through the roof.

In the UK there were year on year rises above inflation in housing. It was obvious a property bubble was rising. My mum and her partners house was sold for £45,000 in 2002 (a 2up 2 down terrace) In 2008 that house would cost at least £115,000. Moved into a detached for £98,000. Over the years after that them like everyone else saw that house prices were rising so they felt richer (wealth effect) so they spent to the limit and remortgaged to 100% of the value. Had cars on finance and spent their credit cards to the limit due to easy credit.

This sqeezes incomes because debt repayment on mortgages, cards and HP took up proportions of middle class incomes that increased year on year. The working classes did the same but with credit cards and unsecured finance. First time buyers were being offered 110% mortgages, 30 years or more mortgages and eventually they were squoze out of the market.

Whilst during all this the majority of the UK forgot that their incomes weren't rising because they felt like they were.

It was free credit, That left us susceptable to recession and would eventually cause the economy of the UK to go into recession. Which would have caused the credit crunch to start here, if it weren't for the US subprime bubble, albeit a lot later. Relative to the size of the economy our banks were huge and had low capital ratios, it would have caused a credit crunch globally due to the interlinked nature of the banking system.

This is where the free market failed.

The lack of regulation of derivatives, left western economies (especially service based like the UKs) to suffer deep recession. Derivatives left the financial markets exposed to unlimited losses and a credit based domestic economy meant as soon as a recession struck the recession would be deep.

As you probably agree recessions are inevitable. But the severity of this recession was caused by a lack of will on the part of governments to control credit properly.

Originally Posted by Da_Rude_Baboon

So, given the above, why do you think government regulation would have the seen the oncoming crisis (which it played a significant part in creating) when the vast majority of the financial sector didn't? Which part of the process should the regulators oversee?

I think regulation is vital but the the answer is not necessarily more regulation. Who does the regulation? What do they regulate? How do they regulate? These are all vitally important questions. If we want to avoid another crisis lik the one we are all living through now then we have to get to the truth of what actually happened. Yes, corruption, greed and predatory lending in the financial sector played their part but politicians and their interference played an equally large part which most of us are unaware of.

What I found when I used to say pre credit crunch; that recession was inevitable, house prices will fall and the recession will be deep because of the amount of credit. People told me it was b*ll**cks. Which ended with me feeling a right Cassandra (not for the first time) Now I am a sixth form school leaver with 2 years+ unemployment under my belt . Which I would likely not be if I was born 4 years earlier.

I myself do not believe that regulation has to increase in quantity however we do have to be looking to make the regulations more efficient. We all know very well that government intervention played its part as well.

When you see that the average house prices in the UK are 5 times the average UK wage then after when it hits 6, 7,8,9,10,11 times, ignoring this is wilful ignorance. Interest rates and capital ratios need to increase slightly until the market is under control. However the oposite happened rates stayed at a cheerful 4.5-5.5% and capital ratios were dropped by the BoE.

Regulatory faliure yes, free market faliure yes. Regulation freed the market and the market failed to regulate itself, unbalanced the economy and increased the size of the bubble to be burst.

It would be best if this recession didn't result in people jumping on the regulation or freemarket bandwagon because of the element of fault from either side. But instead learn where the market needs regulation, to make that regulation efficient, use the problems to identify the solutions and finally change the attitude of wilful short termism and ignorance into an attitude of self reflection with an eye on the longterm.

Maybe look tobe more like germany (without the euro) because their governments have contiually been sucessfuly interventionist. Germany's manufacturing had stengthened, while the UK and the US let a lot of their manufacturing go to the wall through the free marketism of thatcher/raegan era and set in motion what no one had the will to change course (except barack).

[asura]

Originally Posted by eddie543

Now I am a sixth form school leaver with 2 years+ unemployment under my belt . Which I would likely not be if I was born 4 years earlier.

Yup I graduated in Architecture just in time for this headline One-third of architects laid off in last year, survey finds! And just like that, my employment prospects fell through the floor, only to be followed a year later by Two thirds of Irish architects made redundant in past two years! Which thoroughly nailed me and hundreds of other graduates in a small dark smelly room.

So now I work two part time jobs, both self employed... not the best fun in the world.

[eddie543]

Originally Posted by asura

Yup I graduated in Architecture just in time for this headline One-third of architects laid off in last year, survey finds! And just like that, my employment prospects fell through the floor, only to be followed a year later by Two thirds of Irish architects made redundant in past two years! Which thoroughly nailed me and hundreds of other graduates in a small dark smelly room.

So now I work two part time jobs, both self employed... not the best fun in the world.

Thats why I didn't go to uni I thought I could find something get experience. Move along now rather than wait three years to be unemployed on a History degree, with three years less behind me in work.

I can't imagine how difficult having a degree and struggling for work is. The fact is that is a waste of an intelligent persons career and ability.

The difficulty is mental especially, I'm finding more and more that my sense of self worth is related to whether or not I get a job (I've thrown myself in workexperince course, when I can, but they're two short and my last one in retail destroyed my confidence in myself I could do the job but the fact that people with apparent learning difficulties can get a job and I can't grinds at me among many many other things.) Especially in the situation me and my girlfriend are, the stigma of being umemployed is larger than its ever been, when its more difficult now to get out of unemployment than it has been for a long time.

[Er-El]

Following the initial period of the industrial revolution, which was already a salvation for many workers from famine, there was a record of continuous improvement in the average worker's lifestyle for another century from 1750 to late 19th century, in every facet from work conditions to wages, to life expectancy, before any meaningful legislation was enacted. It turns out the first significant law was only passed in 1833 anyway, which in retrospect accomplished relatively little when you consideer the strides of progress that had already been made prior to this and continued to ensue. For the same economic reasons wages had shot up work conditions had progressively improved too.

While it is true that quite a few factories were far ahead of the rest in offering less physically demanding and strenuous jobs with safer procedures and longer breaks, especially during the more mature stage of the revolution when it was more economically feasible, it's not like it was something they put up with with gritted teeth out of guilt and pure compassion. They saw the benefits from this with a more productive work force. Some factories opted for investing in more efficient and safe machinery, others directed scarce resources towards boosting morale by creating a less demanding work environment. It could be said that more and more of the capitalist class had been enlightened of this and reaped the rewards for it.


Price fixing (as well as cartellisation) have occurred in free-markets but in a way where they don't really pose a threat to the consumer like government enabled ones do which is what tend to emerge in mixed-economies such as today, with the ones you cited. In fact the examples you gave are in industries that resemble nothing even close to free-markets, they are licensure systems.

Banking and finance is a licensure system, each bank is essentially a licensee of the fractional reserve banking system (not a product of the free-market and a concept that would probably never hold up in a true competitive market). With government setting the reserve ratio and the central bank managing the interest rate, the whole system is underpinned by a distortion of prices to start with. Another example where government regulation here has failed; where one problem is a consequence of the former.

Energy industry is the same, so is telecom, transport etc. No one actually owns the infrastructure and the airwaves. Normally when companies collude to fix or jack up prices in a free-market with the market being open to new entrants, either the agreements would eventually break up themselves from tension within when one of them want to start raising prices or if the product is capable of going for a lot cheaper someone else will be incentivised by the large profit to come in and under cut them. What's preventing that from happening in a lot of these markets is that new competition is almost completely closed off. No one owns any of the infrastucture, so there is no true price mechanism, and there are strict guidelines on how everything from electricity to water is delivered. This completely disincentivises anyone with radically different ideas from coming in and competing.

[eddie543]

Originally Posted by Er-El

Banking and finance is a licensure system, each bank is essentially a licensee of the fractional reserve banking system (not a product of the free-market and a concept that would probably never hold up in a true competitive market). With government setting the reserve ratio and the central bank managing the interest rate, the whole system is underpinned by a distortion of prices to start with. Another example where government regulation here has failed; where one problem is a consequence of the former.

Reserve ratios are minimums, in the 2000s they were left to their own devices (to the extent that reserves rates were well below sensible anyway) and they didn't control their reserves properly leaving them exposed. I

If reserve ratios didn't exist (freer market) then that would have magnified the situation due to increased lending.

If Banks weren't licenced consumer protection would go out the window.

If banks set their own interest rates through a free market interest rates would have been a lot lower during the boom promoting more lending again leaving greater exposure to losses.

The greatest problem in the financial sector was myopic attitudes and short memories. The free market only works in a society where everone makes rational choices or takes acceptable levels of risk, which doesn't occur.

How little regulation do you believe in?

[eddie_dane]

For, literally, hundreds of years, bank lending had been settled to not only a science but a discipline. The ratio of 3 to 1 leverage was stabilized out of experience. For centuries, lending to mortgage land was the safest way to earn interest. When the US government got involved in getting everyone into a house and underwriting those riskier loans, the leveraging grew to around 30-1.

So for hundreds of years, banks and lenders went virtually unregulated growing wealth enormously. All the aspects you are complaining about are not only in spite of government involvement but because of it. More than anything, lenders like to be paid back. When the government is encouraging and underwriting additional risk, the implication is that there is, essentially, no risk at all. And here you see the results. Pile on top of that, when these banks get caught overextended, they get bailed out. What behaviors do you think these government involvements are really incentivizing?

[DXR_13KE]

Originally Posted by Er-El

No one owns any of the infrastucture, so there is no true price mechanism, and there are strict guidelines on how everything from electricity to water is delivered. This completely disincentivises anyone with radically different ideas from coming in and competing.

Strict rules need to exist in these kinds of infrastructures.

[mucgoo]

The problem with infrastructure products is the barriers to entry are massive even if its was a free market due to the capital cost of a new infrastructure network. Even I think its not something which is workable without heavy government regulation.
For telecoms there's a finite number of frequencies so you need regulations to prevent interference occurring. A similar idea applies to say water companies due to the knock on effects of tapping an aquifer or damming a river.

[mucgoo]

http://www.economist.com/blogs/freee...12/11/growth-0
I thought it was relevant to a few pages back when we were still on the topic of protectionism/free trade.

[lp1988]

Originally Posted by mucgoo

http://www.economist.com/blogs/freee...12/11/growth-0
I thought it was relevant to a few pages back when we were still on the topic of protectionism/free trade.

Great article, I am not that hooked on the "comparative advantage" theory as I have a few areas of critique on the theory but he does raise a few good points.


Kinda liked the part he quoted from another paper:

The American development of mass production methods was also encouraged by the country’s higher and more widely diffused incomes which supported an ample domestic market for the new metals-based durable goods. By contrast, Europe’s lower and less equally distributed incomes initially restricted the market for such goods to its well-to-do classes, for whom standardized commodities had less appeal in any event, and thereby delayed the full application of American mass production methods.

Notice how today the income distribution is far more equal in (most of) Europe today than in America, just a thought.