/biz/ - Business & Finance

The short version is they don't work.

>>616172
Look at EU you motherfucker, that is Marxist economics at its best.

>>616172
>marxist
>economics
choose one.
you can't have eficiency in a model set up to fail in a few years.

>>616172
>>616172

Marxist economics don’t work. But nether does unrestrained capitalism. People are neither infinitely collectively interested, or completely self serving. Nor are CEO's genetic supermen. The best system is one in which keeps predatory and destructive business practices under the purview of the government while leaving the consumer with the ability to manufacture, and make choices.

>>616176
You're an idiot.

Now we've got that out of the way. OP the reason Marxism or basically any other form of communism doesn't work is because the state is less efficient at pricing goods than a market is.

The main idea of capitalism is that markets have an incentive to price things correctly - If someone buys an item for more than it's worth, they lose out. As does someone to sell for too little. In an economy where the governments sets the prices however, a government Bureaucrat has less incentive to really work out how much Wheat is actually worth.

On top of that you have the issue of government constantly having to correct the price as new situations develop. The main issue under Stalin's Regime (It's not the same type of communism but it's the same problem) was that famine's kept happening across certain parts of Russia because as a crop failed an people panic-bought, the price didn't actually rise until a government agent actually declared a new price for wheat, and by then there was a shortage.

For more reading:
http://en.wikipedia.org/wiki/Economic_calculation_problem

>>616172
Marx's attempt to apply scientific rigor to analyzing society was novel for the time but he failed in its execution and ended up creating the blueprints for some of the most extreme totalitarian systems the world has ever known.

1: Blames nearly every problem in society on capitalism, habitually comparing capitalism in the real world to theoretically perfect communism.

2: He swings to the other extreme promoting centralization of the economy in the hands of the state, ignoring the limitations of even a highly democratic state.

3: His theories depend on an incorruptible political entity that is benevolent and effective enough to implement his utopia.

4: Stalin, Mao and others were not "true communists" but they certainly spent a lot of resources promoting his ideals in their propaganda, mainly skapegoating capitalists and promoting the belief that the state represents "the people". It is perfectly reasonable to question why this is.

I think that about covers it as concisely as possible.

its not about equality its about control and using "equality" as justification for control

>>616172
They're shit.

>>616172
That your best bet on getting good information on this is years of studying sociology, economics, the history of the world for the past 1500 years, psychology, and a little bit of political science. On the history part, in particular the sociological analysis of history, pay extra focus to the societies that actually gave some form of Marxism a try, including what they were like before and where those societies are now; compare them to their non-marxist counterparts, and don't forget about the difference in political structures and the general political traditions of the tried-Marxism vs. didn't-try-Marxism societies.

The people most likely to tell you anything about Marxist economics on 4chan will tell you that Marxism doesn't "work", without defining what they mean by a "working" or "functioning" economy.

A lot of the general critiques of Marxist economics could easily apply to to most all other economic theories just by changing what portion of the economy the critique applies to, especially any efficiency arguments.

There isn't any "redpill" on this subject, and redpills from the non-professional-academic internet tend to be full of shit anyway.

Also, keep in mind that Marxism as a concept doesn't even have 250 years of thinking (going back to the French Revolution) and social experiments behind it, and very few social experiments within the just over 160 years since actual Marxist economic thinking became a thing; by contrast, the economy of modern-day USA, while certainly has its revolutionary features that are without historical precedent, has hundreds upon hundreds upon hundreds of years of tradition, thinking, and tons of social experiments to learn from, and what revolutionary elements it does have stem from those traditions.

>>616180
>any economics
>legitimate source of knowledge

watch some of this and realize how economics is nothing but cherry picking facts to fit your preconceived ideas

http://www.c-span.org/video/?323755-1/hearing-economic-growth-policies

I didn't watch the whole thing on c-span but I did see a part where Feldstein says the U.S has an incredibly low savings rate because the U.S tax policy does not 'incentivize saving.'

The reason savings rates are so low is because people don't make enough money to save. If they did save their meager wages consumer demand would be so damn low the economy would be in a depression or recession.

Economics is a joke.

I do respect Marxist economics because they are right in the fact that capitalism will have crisis after crisis and that the upper class will justify their positions. While classical liberalism claims to be an impartial, final truth, fact-based ideology. Marxism unabashedly declares it is for the working class and all its accompanying biases.

Marxist economies generally disregard supply and demand, and will always increase production of resources they already have a surplus of while disregarding production of goods and resources the country needs. Production is valued over capital.

Also fixed prices on goods. Black markets always emerge in communist countries so that the consumers can buy things at the real market price.

It doesn't work.

>>616176
>Look at EU you motherfucker, that is Marxist economics at its best.

Marx died in the 19th century, so he has nothing to do with the EU.

Marx wrote about capitalism, he wrote next to nothing about how to run an economy. He said "It's not for me to write recipes for the kitchens of the future". The most he wrote as a plan were a few sentences about how workers should be in charge of production, and that sort of thing.

Marx never gave instructions for how an economy should run, so he can't be blamed for economies. If you look at socialist countries, some did very well - the USSR economy did great under Stalin. The Chinese economy has done very well under the leadership of the communist party from 1949 to now, China is by some measures the largest economy in the world.

Also the metrics are odd. People measure the US against Cuba, but Cuba was poor in 1958. It has had an embargo etc. for decades. Even considering that, how much worse off is it than Jamaica, Haiti, the Dominican Republic and its neighboring islands? Cuba has done well compared to Haiti actually. You never hear that though.

>>616437
What about The Capital? on which he spent 10+ years of his life?
you shouldn't even pretend you know it. It's visible you don't. If millions of Jews believed him like the Messiah, I'd look it up.

The key stone of Marx is precisely economics. Understanding how it's done and how it is potentially unjust, allows democratical movements to suggest more egalitarian alternatives.
And God-free ones: Marx's goal is to dechristianize Christians and topple regimes for revolutionary jews. All antisemites or so have read this between the lines. But frankly it wasn't stupid from him since the 19th century God was doing the bourgeois' bidding.

>>616176
>mfw there are people who unironically believe this

you ignorant opinionated faggots are the reason why public discourse is so shit.

>>616172

The labor theory of value is bullshit compared to the subjective theory of value, thus Marxist Economics generally tends to fall apart right there. Any valuable contributions that Marxist economists have made to the field have already been accepted by mainstream economists, thus making the school almost entirely heterodox and ideologically driven. That said, Marxist researchers still produce decent research once in a blue moon, the most recent example of this was a study that spanned several decades and looked at education results. That said, most Marxist economic theory is complete outdated bullshit.

>>616406
>The reason savings rates are so low is because people don't make enough money to save. If they did save their meager wages consumer demand would be so damn low the economy would be in a depression or recession.
Probably the most ignorant comment on economics I've read on this board.

>>617009
explain yourself.

bump

>>617054

The banks give loans to people with shit credit. A lot of people default on the debt. This includes everything from credit cards to mortgages. The effect of this is low interest rates on savings.

Another reason is the fed can regulate interest rates themselves to encourage spending instead of saving, which helps stimulate the economy.

>>618194
poor people have no money to save because you have low wages and high debt load.

poor people aren't spending high percentages of their income because interest rates are low, they are spending high rates of their income because their income barely covers living expenditures. simply put they have no money to save.

>>616210
So...China?

>>618235
Or America.

Hell, the idea of "unrestrained Capitalism" is just as stupid as "Pure Communism". Neither are ever going to happen as in Communism, everyone starves to death because of government incompetence, while in Capitalism, up to a certain point people will give up freedom for security.

>>616437
>The most he wrote as a plan were a few sentences about how workers should be in charge of production, and that sort of thing.
Errr, kinda good point though, Karl Marx's economist thought was not to centralize the economy into the hands of the government, but instead have the workers control the firms.

>>618225
Entertain me for a minute.
The US, in 2006, had a median household income of 50K, and saved roughly 2.4% of it.

Meanwhile, in the Philippines, the average income was 172K pesos (~12K dollars). On average, they saved 53% of it. The gross savings rate in the US in 2006=18%. I don't have numbers on median Philippines household savings rate.

They had WAY LESS money, and saved WAY MORE of it, by percentage. For God's sake, MEXICO saved 20% more than we did, INDONESIA saved 45% more than we did. You can't say "its because the US didn't have any money to save".

In 2006 we were the most economically productive nation on the planet. "Nobody has any money to save" is willful ignorance.

sources:
google (median 2006 income)
forbes (2006 savings rate)
http://data.worldbank.org/indicator/NY.GNS.ICTR.ZS?order=wbapi_data_value_2006+wbapi_data_value&sort=desc&page=1 (savings rates)

Note: I save ~70% of my income and should be able to retire in 5 years or so (the percentage holds up at all income levels).

Off Topic, but who's the person between Marx and Lenin?

>>616176
>mfw when people start to believe bullshit political rhetoric

>>618283
Yeah cost of living is much lower. Here most places you'd spend at least 10k a year on rent/electricity/water.
It's apples to oranges tard

>>618283
do Filipinos, Mexicans and Indonesians have to pay rent on home with indoor plumbing, hot water, electricity, internet? Do they buy gas to drive on asphalt roads? Do they see doctors when they get sick? Do they get disability insurance when they get disabled?

when conservatives rail about how the First world countries need to be competitive on labor cost with third world countries they are asking for a drop in living standards.

On another subject household income is different from individual income, usually you have two adults working which means each adult is earning on average 24k and you might have a grandparent getting social security.

Things would be a lot different if an individual earned 50k. The truth is 48 percent of Americans make less than 24k. http://en.wikipedia.org/wiki/Personal_income_in_the_United_States

>>618283
>completely ignoring crossnational variances in price levels and cost of living

I don't even know where to start with this in all honesty. When working full-time at minimum wage leaves you below the poverty line, expecting significant saving among the lowest-income Americans is pants-on-head retarded, regardless of how high the interest rates are.

>oh why don't they just save anyway and that way they'll have more money in the future to invest and use thanks to the interest they'll get on the savings they accrue now

I mean yeah this is a good idea, but it still relies on the assumption that there's even a miniscule amount of income that they can afford to devote to savings without literally starving or being kicked out of their ramshackle living quarters.

>>616437
>the USSR economy did great
What the fuck am I reading?

>The Chinese economy has done very well under the leadership of the communist party from 1949 to now
It's actually a function of China liberalizing their economy to be more capitalistic and providing incentives to companies who do business there.

>Cuba was poor in 1958
Not really. They had an upper and middle class at the time with some of the most advanced infrastructure in central America. Today everyone is much poorer and their infrastructure is laughable.

>>617009
I agree.

marxist economics is an oxymoron

It's quite simple, really.

>>616172
I can't tell you about marxist economics, but I can tell you about some of Marx's economic work. He's done something right in his analysis of the working day, but doesn't really work with his LTV.

Off the top of my Head, Marx used three catagories in his analysis of the working day (this was aimed at production of physical commodities, not services). There is:

Constant Capital, which is basically the means of production e.g. tools, land, machinery, etc. that is owned by the manufacturer.

Relitive Labour, which is the human labour needed to convert raw materials into commodities.

Surplues Labour, which is excess labour. This is labour not needed to make ends meet. It is an extension of it.

Marx acted under some presumpitions. 1. The manufacturer want to maximise his capital, 2. The manufacturer by extension of this, wants to minimise his loss.

The manufacturer can't get rid of his constant capital and his relitive labour, as he could no longer maximise his capitial. Yet he cannot create new capital simply by CC and RL alone. At there minimum effeciecy, they would only ensure the business would keep going. Not that there would be a profit.

Profit occurs by Surplus Labour, which is generated by working more then the nessesary hours for the survival of the business. The manufacturer, gives to the workers the bare minimum needed to survive and takes all the commoditites wrought by they're surplus labour.

So if there was a 10 hour working day for the production of pens. 1 hour equals one box of pens. The wages needed to survive for a day is equivelent to 8 pens for each worker. The other 2 boxes of pens are given to the manfucaturer as payment (since they're kinda renting the means of production from him). There are 50 workers, so the manufcters gains a wage equivelent to 100 box's of pens for a day. Some of this goes back into restoring CC, but the rest of it is surplus capital which is used as an investment for more workers and resources.

>>618452
This doesn't take into account how value is created through seeling commodities by merchants, Marx may have mentioned this in volume 3. It doesn't work with the LTV, but it is an intresting way to examine how capital and power is concentrated in the realm of production.

I may have not have used the terms correctly, so sorry about that. Your better off asking /lit/ for a discussion of marx then /biz/.

>>618446
I honestly can't tell and honest to God hope that people who consider austrian 'economics' to be any more relevant than marxist ones are merely trolling.
Austrian is not economics school, it's a philosophy based on stupid assumptions and completely ignoring factor of time.

you should consider his work on his conception of human nature and how selling labour leads to an outside force controlling how we act and think and move that we otherwise would not which of course alienates us from our species-being and feels bad man, all of which is for a seemingly less important goal of creating 'wealth' or material goods.

to get marx you have to consider your priorities in a very macro sense, for how society should be organized.

you can ignore communism completely btw.

>Marxist economics

What is that?

>>618290

Trotsky, I think

>>618677

Wait, that's Engels

Pic related.

Even the Russians don't buy their own bullshit.

>>618716
>their own bullshit.
German-hehe bullshit to be correct.

https://www.youtube.com/watch?v=WGYdZo3mw00

This is an economist graduated from harvard and stanford. A marxian economist who goes into detail with great clarity. He has many lecture online which are worth listening to