Stoicism

[Ares Land]

What if we use different metrics for valuing things? What, for instance, about the work that goes into producing goods and services? Would you seriously claim that each year, the result of more hours of human work is brought from the richer parts of the world to the poorer parts of the world than vice versa? Would you seriously claim that over the last 700 years, the result of more hours of human work was brought from the richer parts of the world to the poorer parts of the world than vice versa?

That is, pretty much, the labor theory of value, and that theory has several issues.
The thing is, it's entirely possible to work people to death and still get zero value in return.
I don't know much about British India... But it's entirely possible that they managed to get, by force, the product of countless hours of labor and be unprofitable.
(But the fact that we didn't profit from colonialism then doesn't mean we don't profit from labor exploitation in poorer countries now!)

At first, Frenchmen even supported the Haitian Revolution. Then they gradually became "reasonable" as ideology evolved to let them both love freedom and enrich themselves. The meaning of freedom is a deep issue in contemporary philosophy. The Ljubljana school would classify Spartan freedom as "obscurantism". A huge part of their theory presents a meaning of freedom that avoids obscuring oppressive practices.

PS. They trace their origins to the early French Revolution.

So ultimately, you can only eliminate oppression by valuing freedom as defined by the Ljubljana school ? That's a nice hypothesis, but it's completely unproveable!

[rotting bones]

So ultimately, you can only eliminate oppression by valuing freedom as defined by the Ljubljana school ? That's a nice hypothesis, but it's completely unproveable!

Not just the Ljubljana school. There is a long tradition dating back to the early French revolution. It includes both materialists like many Western Marxists and thinkers who are basically idealists like Badiou.

Even this position is not perfect, but frankly, I think it is superior to Stoicism.

[rotting bones]

The thing is, it's entirely possible to work people to death and still get zero value in return.

Just to be clear, this is not Marx's law of value, which accounts for supply and demand. Some Marxists even claim that the contemporary law of supply and demand was obtained by stripping Marx's law of value of whatever remained in it of Smith's labor theory of value.

[rotting bones]

(But the fact that we didn't profit from colonialism then doesn't mean we don't profit from labor exploitation in poorer countries now!)

Do you think it's a fact that colonizers didn't profit from colonialism?

[Raphael]

That is, pretty much, the labor theory of value, and that theory has several issues.
The thing is, it's entirely possible to work people to death and still get zero value in return.
I don't know much about British India... But it's entirely possible that they managed to get, by force, the product of countless hours of labor and be unprofitable.

I don't fully agree with the labor theory of value myself, but I think in certain contexts, it can make more sense than the "Whatever The Markets(TM) say" theory of value.

Yes, there might have been British capitalists in the Raj who went bankrupt while exploiting cheap Indian workers, but whether someone legally goes bankrupt is based on monetary calculations, and in this context, I've started out from the idea that the monetary value of things isn't everything.

My point is that, if you have an economic setup where Group A works very hard all the time while having a materially very simple standard of living, and physically, the things they produce through that work go mostly to Group B, enabling Group B to have a physically much more comfortable standard of living, and if, then, a thorough analysis of many numbers written in books, binders, ledgers, and in more modern times, computer systems, leads you to the conclusion that no, Group B does not really profit from this whole arrangement at all, and is really working at a loss - well, in that case, the numbers in the books, ledgers, binders, and computer systems might be an inadequate reflection of physical reality.

[zompist]

zompist: Even if capitalism is the best generator of wealth, that has no bearing on improving the lives of Chinese people because China is already capitalist.

1. Investors simply do not offer colonized countries the same opportunities as the colonizers. My examples are intended to explain how other capitalist Asian economies developed themselves despite the difficulty in securing loans.

2. Do you really believe that loosening restrictions on business will increase the wealth of the average Chinese? That hasn't worked in India so far. If it has the opposite effect, then opening up the Chinese economy is bad news for the local quality of life.

These points don't seem to have anything to do with what I said. I'm not even defending capitalism; but even if you want to destroy it, you have to know what it's capable of and be sure you're replacing it with something better.

Mean per capita income has increased in India sixfold since 1960, and most of that change occurred after 1990. My understanding is that growth has been fastest in Mumbai and in the south. Your state is relatively depressed. I'd be interested to hear your view on why there's been such a discrepancy.

1. If capitalist corporations are raking in a huge profit, that means most people don't have enough money to spend buying their manufactures and a recession is at hand. The rational capitalist solution is to have firms take a loss one way or the other and then bail them out.

Actually it probably means that the capitalists have found ways to enable rent-seeking. And bailouts, as has been said, are a way to socialize loss while privatizing profit.

3. The high purchasing power of first world countries depends on cheap third world imports. Not only raw materials for industry, but also manufactures from places like China and Bangladesh.

The US has moved a huge amount of its manufacturing to China in the last 20 years. That's a major factor in both countries' predicaments, but it doesn't tell us very much about how capitalism worked for the previous 225 years.

Later you mention the British destruction of the Indian textile industry. Which is true, to my knowledge. British trade theory was the opposite of US plutocracy: it depended on concentrating manufacturing only in the metropole, and actually preventing development elsewhere. This applied as much to Ireland as it did to India.

Though capitalists, well, always go for money, they've acted differently at different times and places. Even today, Germany, for instance, managed to keep its manufacturing sector.

[zompist]

My point is that, if you have an economic setup where Group A works very hard all the time while having a materially very simple standard of living, and physically, the things they produce through that work go mostly to Group B, enabling Group B to have a physically much more comfortable standard of living, and if, then, a thorough analysis of many numbers written in books, binders, ledgers, and in more modern times, computer systems, leads you to the conclusion that no, Group B does not really profit from this whole arrangement at all, and is really working at a loss - well, in that case, the numbers in the books, ledgers, binders, and computer systems might be an inadequate reflection of physical reality.

OK, two things. One, of course individual colonial entrepreneurs can make out like bandits. E.g. Robert Clive personally grabbed one third of the Bengali treasury. I already mentioned the returns French investors got from foreign holdings. Obviously they benefited. Are you so sure that the 90% who held no stocks benefited? Even a little bit, as opposed to having to pay more in taxes, or suffering other side-effects of imperialism?

And what you call "ledgers" have immense importance! If the British government lost money on India, it mattered very much to the British government. I've already mentioned one consequence: the loss of British North America.

Two, you're more or less asking that everything be calculated in PPP. I doubt this data exists historically, but I'd love to see it.

The thing is, I'm not sure it'd show what you want it to show. When there's a large nominal price difference between (say) 18C England and 18C India, it means India was far richer than the raw numbers say. It's likely that a peasant or a small-scale craftsman lived at the same PPP price level in both countries. After all, if you calculate in terms of the median daily wage, or in terms of raw labor hours, you will always certainly find, everywhere before 1800, that a day's wages paid for a day's living.

But, you know, a nominal price difference allows arbitrage... that is, a canny operator can get in there and make money off it. So it's not mere illusion.

[zompist]

The thing is, there are some forms of "exploitation" that don't show up in those figures. Most manufacturing is outsourced to countries with cheaper labor costs. Apple outsources manufacturing to Foxconn. What shows up in the figures for US trade with China is however much Apple pays Foxconn for that; but the retail price is what show up in US GDP. Wealth creation has happened in the internal market. There has been "exploitation" of Chinese workers: labor laws, health and safety regulations are more lenient, wages are lower. Apple wouldn't get anything like these production costs if it manufactured in California. That differential isn't factored in when calculating GDP or trade figures. The same applies to food, clothes, manufactured products... [...]

Why am I using scare quotes, though? Because it's not as simple as a story of the West oppressing the rest of the world. Outsourcing manufacturing has made China richer, not poorer. (Which doesn''t make the moral dilemma any easier.)

I agree with all this, including the ambivalence.

In the postwar liberal period, there was a sort of social compact in the US: we'd allow the rich to make money, and in return they'd give the rest of us money. The capitalists didn't get as filthy rich as they'd like— there were extreme wage caps anyway— but they benefitted anyway, because they could sell stuff to increasingly well-off consumers. Firing all your workers made no sense, because you'd also be firing all your buyers. (Unscrupulous old vultures like Henry Ford understood this very well: Ford increased his workers' pay, not least because he wanted them to be able to afford Fords.)

Capitalists after 1980 broke the compact. They no longer give the 90% money, but keep it all themselves. There are no more wage caps for themselves. They do their best to get rid of good jobs. There's more money to be made in services than in manufacturing, so they didn't care about losing manufacturing. They mostly sell services to each other, so they no longer really care about selling to the average American.

Yet I think you'd find few Chinese who want to return to the early-20C landscape of grinding rural poverty, greedy landlords, warlord governors, and cities dominated by foreign capitalists and their own cheap goods. Hundreds of millions of Chinese live way better lives, in a way that no one could have even understood in 1911.

[Ares Land]

My point is that, if you have an economic setup where Group A works very hard all the time while having a materially very simple standard of living, and physically, the things they produce through that work go mostly to Group B, enabling Group B to have a physically much more comfortable standard of living, and if, then, a thorough analysis of many numbers written in books, binders, ledgers, and in more modern times, computer systems, leads you to the conclusion that no, Group B does not really profit from this whole arrangement at all, and is really working at a loss - well, in that case, the numbers in the books, ledgers, binders, and computer systems might be an inadequate reflection of physical reality.

Do you think it's a fact that colonizers didn't profit from colonialism?

I'll use Algeria as an example. The system benefitted the colonists (ie. the pieds-noirs, the Algerian-born French citizens), colonial officials, and a number of companies who either benefitted from a captive market or exploited local resources (whoever imported Algerian wine and oil for instance).
That subgroup definitely profited from colonization, and they were politically important. Enough to make sure that getting out of Algeria amounted to political suicide.

But... None of that was possible without the army on the ground, or infrastructure. The colonists were heavily subsidized. And those expanses turned out higher than the profits, so for Metropolitan France, ruling Algeria was not profitable.

So basically, Group B made huge profit because it benefitted from the cheap labour of Group A and was subsidized by a much larger Group C, who bore the expense of keeping Group A in check.

So, even though Algerian colonists were exploiters and made heavy profits, colonization of Algeria Metropolitan France didn't, on the whole, profit from it. (In fact we can't see any economic impact of decolonization).

Not just the Ljubljana school. There is a long tradition dating back to the early French revolution. It includes both materialists like many Western Marxists and thinkers who are basically idealists like Badiou.

Even this position is not perfect, but frankly, I think it is superior to Stoicism.

And, arguably, both French revolutionaries and the Marxists failed...
But I see your point! The thing is, I see no contradiction with Stoicism. Stoic ethos is about having a will in accordance with Nature. There's no opposition there to our current ethos that holds that 'human beings are born free and equal'. There's certainly no problem in being say, a Stoic and a Marxist!

[rotting bones]

So, even though Algerian colonists were exploiters and made heavy profits, colonization of Algeria Metropolitan France didn't, on the whole, profit from it. (In fact we can't see any economic impact of decolonization).

These points don't seem to have anything to do with what I said. I'm not even defending capitalism; but even if you want to destroy it, you have to know what it's capable of and be sure you're replacing it with something better.

My argument is that despite their losses, colonizers grew their economies at the expense of the colonists. Capitalist businesses lose money all the time while the real economy grows. I then proposed mechanisms involving cheap raw materials, etc. It is a mistake to place so much emphasis on whether colonial businesses were profitable in terms of monetary value. This has already been explained by Moose-tache and Raphael.

BTW, I still insist I'm not a Marxist. The Ljubljana school are more Marxist than me, and they insist they are not Marxist. Marx had too many weird theories for us to take on that baggage.

Mean per capita income has increased in India sixfold since 1960, and most of that change occurred after 1990. My understanding is that growth has been fastest in Mumbai and in the south.

The rational/irrational axis is independent of the capitalism/socialism axis. The INC introduced what I'm calling rational capitalism. BJP has taken us more in the direction of insane deregulation. This strategy has increased the theoretical profitability of enterprises, but profit has a complex relationship with quality of life. In the new jobs that have been created, people are working harder to earn a lower income than in the jobs we were creating before. The new jobs are created faster, but they also disappear faster, as they did last year.

Your state is relatively depressed. I'd be interested to hear your view on why there's been such a discrepancy.

The Communist party CPI (M) wanted to increase industry in the state. The wanted to acquire a large plot of land for a Tata factory to manufacture their 2-seater Nano cars. The farmers didn't want to give up their land. Mamata Banerjee took up the slogan, "Amra Tata chai na! Ata chai!" or "We don't want Tata! We want flour (ata)!" (Half of Indian politics is conducted through the medium of rhymes.) Communism fell. Mamata Banerjee won. The government has been anti-industry ever since. Notice that it is the so-called Communists who were pro-industry. The local capitalists are deliberately keeping us poor as a matter of policy. The chief minister plays Rabindrasangeet at intersections to keep people happy. Bengali culture!

1. If capitalist corporations are raking in a huge profit, that means most people don't have enough money to spend buying their manufactures and a recession is at hand. The rational capitalist solution is to have firms take a loss one way or the other and then bail them out.

Actually it probably means that the capitalists have found ways to enable rent-seeking.

This is the quality of the evidence I have:



Judge for yourself.

And bailouts, as has been said, are a way to socialize loss while privatizing profit.

The jobs have to come from somewhere. I would support the creation of government jobs by direct vote to pick up slacks in the market. Economists will argue this will produce even more slacks in the market. My answer is, so much the better. Whatever rump market survives, survives. Whatever dies, dies. Letting the market dwindle is worth getting rid of deficits in supply.

Later you mention the British destruction of the Indian textile industry. Which is true, to my knowledge.

Thanks.

British trade theory was the opposite of US plutocracy: it depended on concentrating manufacturing only in the metropole, and actually preventing development elsewhere. This applied as much to Ireland as it did to India.

Not once have I accused the decision mechanism of being motivated by racism, though many people were racist, even against the Irish. Ireland is now a tax haven like Singapore.

Though capitalists, well, always go for money, they've acted differently at different times and places. Even today, Germany, for instance, managed to keep its manufacturing sector.

East Germans claim they are not treated fairly.

PS. Anyway, the issue at hand is that our "revolutionaries" are planning to deregulate Chinese capitalism. Is anyone here in favor of deregulation?

[Raphael]

I'll use Algeria as an example. The system benefitted the colonists (ie. the pieds-noirs, the Algerian-born French citizens), colonial officials, and a number of companies who either benefitted from a captive market or exploited local resources (whoever imported Algerian wine and oil for instance).
That subgroup definitely profited from colonization, and they were politically important. Enough to make sure that getting out of Algeria amounted to political suicide.

But... None of that was possible without the army on the ground, or infrastructure. The colonists were heavily subsidized. And those expanses turned out higher than the profits, so for Metropolitan France, ruling Algeria was not profitable.

So basically, Group B made huge profit because it benefitted from the cheap labour of Group A and was subsidized by a much larger Group C, who bore the expense of keeping Group A in check.

I'm not sure you got my point. By "Group B", I didn't just mean people who financially profit from Group A's work; I meant everyone who physically has a more comfortable life as a result of Group A's work than they would have without Group A's work. That might well include people for whom the whole setup is financially a loss.

Sometimes, when I think about economic matters, I use a specific hypothetical that I came up with: namely, the idea of an alien observer observing Earth under specific circumstances. This observer has highly advanced surveillance technology allowing her to closely watch everything human beings do physically, but as of now, she hasn't yet deciphered any human languages, and therefore can't understand any of our communications or legal documents. How would things look like from the perspective of that alien observer?

I'm not saying that said observer's perspective is the only one that matters. In a lot of contexts, communications and legal documents are very important. But sometimes, that alien observer's perspective can be a neat way to cut through the bullshit and see what's really going on.

Or, to put it a bit differently: if, at any point during the era of legal colonialism, the colonized places had simply disappeared from the face of the Earth, would that have led to a noticeable drop in the physical standard of living of most people who lived in the colonial powers? If, for any specific point in time, the answer is "yes", then I think people in the colonial powers, at that point in time, clearly physically benefited from colonialism, even if many of them didn't do so financially. If, right now, the poorer countries would simply disappear from the face of the Earth, would that lead to a noticeable drop in the physical standard of living of most people who live in the rich countries? If the answer is "yes", then I think people in the rich countries, right now, clearly physically benefit from the global economic system, even if many of them don't do so financially.

So, even though Algerian colonists were exploiters and made heavy profits, colonization of Algeria Metropolitan France didn't, on the whole, profit from it. (In fact we can't see any economic impact of decolonization).

Of course not - by the time colonialism legally ended, the economic system allowing people in the now-former colonial powers to benefit from the work of people in the now-former colonies was already in place.

[Ares Land]

I'm not sure you got my point.

My argument is that despite their losses, colonizers grew their economies at the expense of the colonists. Capitalist businesses lose money all the time while the real economy grows. I then proposed mechanisms involving cheap raw materials, etc. It is a mistake to place so much emphasis on whether colonial businesses were profitable in terms of monetary value. This has already been explained by Moose-tache and Raphael.

There's no hint that the average French citizen benefitted in any way from colonial Algeria. Algeria exported oil (which could be had for cheaper elsewhere) and various agricultural products (which were cheaper elsewhere too). Arguably Indochina did better.
I did describe some mechanism into which we can benefit from labor that doesn't show up in the figures. None of these apply here.
I doubt that France's economic growth had the time owed much to the colonial empire. We didn't make use of the cheap labor there for manufacturing; it was sometimes used for agriculture, to doubtful effect. (Algerian wine had to be subsidized: Spanish wine was cheaper). Even the cheap resources weren't cheap (prices were often higher than on the global, plus there was the problem of governing the place, and holding on to it despite the locals wanting you out...)

I do agree, though, that in the post-colonial era, we owe a great deal of our prosperity to cheap overseas labor. In fact, we got a lot better at exploiting poor countries once we figured we didn't have to bother with ruling the place!

Is it exploitation, though? Well, I'm not sure about that. The only thing that worked for getting the poorer countries out of poverty has been, well, selling cheap labour and trying to build a local expertise. (See South Korea, Japan, China...)

PS. Anyway, the issue at hand is that our "revolutionaries" are planning to deregulate Chinese capitalism. Is anyone here in favor of deregulation?

EDIT: sorry, I hit 'submit' instead of 'save draft' last night, and what I posted wasn't very clear. Let's polish it up a bit.

On the whole, yes, I'm in favor.
It all depends on what is meant by 'deregulation' of course.

On the whole, diminishing the role of state-owned enterprises and facilitating foreign investment would probably have a net positive effect. State-owned enterprises act as monopolies.
It'd probably have a net positive effect for Chinese households. Opening markets to people not in a close relationship with the Party wouldn't be a bad idea either!
Easing up restrictions on foreign companies operating in China would only be fair, too, but that's another issue. (I don't see why the EU has to comply with WTO rules but China is somehow exempt...)
On the other hand, though, the Chinese government is probably doing the sensible thing in applying tariffs and restrictions to certain sectors... they do need to build a solid domestic market at this stage.

[zompist]

Or, to put it a bit differently: if, at any point during the era of legal colonialism, the colonized places had simply disappeared from the face of the Earth, would that have led to a noticeable drop in the physical standard of living of most people who lived in the colonial powers? If, for any specific point in time, the answer is "yes", then I think people in the colonial powers, at that point in time, clearly physically benefited from colonialism, even if many of them didn't do so financially. If, right now, the poorer countries would simply disappear from the face of the Earth, would that lead to a noticeable drop in the physical standard of living of most people who live in the rich countries? If the answer is "yes", then I think people in the rich countries, right now, clearly physically benefit from the global economic system, even if many of them don't do so financially.

You're pretty much assuming the conclusion— you assign any drop in living standards to "colonialism".

If poor countries disappeared, yes, very likely First World living standards would drop. Neocolonialism might be a reason, but there are others:

1. A smaller world population.
2. Less immigration to the First World.
3. Loss of resources, whether they were paid for exploitatively or exorbitantly.
4. Loss of ideas, inventions, cultural products, good restaurants, etc.
5. Loss of First World jobs directly involved with poor countries.

Note that the same things would happen if any large group of countries disappeared, e.g. all those whose names begin with A.

[rotting bones]

I'm busy, but I have some questions:

1. Are you talking only about Algeria or colonies in general?

2. If workers are starving, would you consider creating government jobs in place of the ones that business is unable to create even if doing that hurts business interests?

3. I'm pretty sure the revolutionaries think something along these lines: https://www.youtube.com/watch?v=P2wdwZxk17o What do you think?

Just to be clear, I'm not anti-American. I have doubts about Wall Street's profitability benefiting the rest of the world, but I have the same doubts about China's international business ventures and so on.

PS. Basically, I want to argue that it doesn't matter whether cheaper goods were available elsewhere, only whether Algerian goods were cheaper than French goods. I don't know if that argument is worth putting much effort into.

PPS. Also, when I say "rational capitalism", I'm thinking of Manmohan Singh's work.

[MacAnDàil]

MacAnDàil: People are complaining about the absence of fair competition in China because they think Wall Street can make a lot of money if corporations were allowed to do business there freely. I doubt this will benefit Chinese workers unless they are allowed to stream into America. I doubt Americans will allow that either.

Some people, perhaps, but which people are you referring to? The current US government? Or the supporters thereof? These have never been majority even within the US, let alone the West or the Internation Community in general. And I don't support them either.

I will say it again: I don't think China is communist and I most certainly don't support its government.

Cool, we're in agreement there.

Let me summarize the discussion so far.
...
What I support is benefiting everyone. That is why I'm opposed to revolution in China by the elements that are currently calling for one. A potential objection is to argue that all of China should be a giant tax haven, which means admitting you are a libertarian. I'm assuming you don't want to go in that direction. There may be other objections, but I don't know what they are. Feel free to quote facts at me.

Which discussion is this? It doesn't take into account anything I've said, as far as I can tell. And no I certainly don't want China or anywhere else to become a tax haven.

Also, while Indonesia and Thailand aren't glowing examples of democracy and human rights, they have about the same GDP per capita of China and at least they aren't outrageously awful dictatorships rounding up the ethnic minorities and political prisoners into massive concentration camps. Also, there are workers' movements at the moment in the China. If they actually manage to succeed on a larger scale than they even intend to, they could have a government closer to Marx's ideas that those of the CCP.

[Ares Land]

I'm busy, but I have some questions:

1. Are you talking only about Algeria or colonies in general?

Algeria. We don't have as much data on other French colonies, and I couldn't meaningfully comment on the British colonial empire: I know next to nothing about it.

2. If workers are starving, would you consider creating government jobs in place of the ones that business is unable to create even if doing that hurts business interests?

Yes of course. You don't even have to get as far as starving people: I think creating government jobs is a pretty good way of handling unemployment. State-owned businesses, or just having the state directly handle some jobs is sometimes the right thing too.

3. I'm pretty sure the revolutionaries think something along these lines: https://www.youtube.com/watch?v=P2wdwZxk17o What do you think?

Just to be clear, I'm not anti-American. I have doubts about Wall Street's profitability benefiting the rest of the world, but I have the same doubts about China's international business ventures and so on.

Dude, a one-hour lecture by Steve Bannon? Can't I do something more rewarding instead, like gouging my eyes out with a spoon?
Global capitalism, while generally unsavory, has some redeeming points. Open markets and competition are one of them: it means it isn't as easy to have abusive monopolies. It seems likely that Chinese businesses are basically just collecting rents and abusing a monopolistic position in protected sectors.
That said, I believe capitalism and neoliberalism are just tools. Sometimes protectionism is the right tool for the job, sometimes socialism is.

PS. Basically, I want to argue that it doesn't matter whether cheaper goods were available elsewhere, only whether Algerian goods were cheaper than French goods. I don't know if that argument is worth putting much effort into.

Yes, we have no disagreement there. And I agree that colonialism was an horribly abusive.
I just disagree with the common idea that the West owes its prosperity to colonial empires. I don't think it does.

Taking Algeria as an example again:
- Algerian wine was cheaper than French wine, because the winegrower there benefited from cheap local labor, plus had better national resources.
- That said, the average Frenchman took a loss in buying Algerian wine, because he could have bought Spanish wine instead. Algerian goods were consistently priced above market level, and everything was subsidized. Why is that? Because our successive governments wanted a settlement colony, and nobody was interested in living in Algeria. People had to be subsidized to live and do business there.
- Plus, he paid higher in taxes than he had to, because the Algerians strongly resisted the occupation. We had to make a show of being benevolent rulers (building dispensaries, hospitals and the like, which cost money) and more importantly, permanently station troops there.

Did some people profit from French Algeria? Definitely. Did French economy as whole profit from it? Nope.