Monday, March 31, 2014

But Lagarde says deflation is the enemy

Capitalism is making way for the age of free

Article discusses the phenomena of ever improving technology driving productivity and decreasing marginal cost.

Posted by underscored @ 07:43 PM (1603 views)
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5 thoughts on “But Lagarde says deflation is the enemy

  • Reduced prices from improved technology IS capitalism. Whilst some things have become free, other things have soared in price, responding to supply and demand.

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  • Capitalism is an economic system in which trade, industry and the means of production are controlled by private owners with the goal of making profits in a market economy. Central characteristics of capitalism include capital accumulation, competitive markets and wage labor. In a capitalist economy, the parties to a transaction typically determine the prices at which assets, goods, and services are exchanged.

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  • The author has missed a more fundamental point.

    The premise is that technology is driving goods and services to a free cost, resulting in the end of the free market system. This isn’t true; take promotions; something is given away for free as advertising. There is still a cost, but it is not in monetary terms.

    The real issue is that technology is allowing industrialists to produce without paying labour. This means that there is no flow of money from producers to consumers; since most consumers are labour.

    If labour cannot work, consumers cannot spend. Unless you envision a free market where only the capitalists have any income and can therefore participate. The end of the free market system is arriving not because things are free but because in the pursuit of efficiency industrialists are destroying their owns consumers.

    The answer is either to protect jobs artificially. This is a jacobite distopia. Or to award capital arbitrarily to everyone. I’m with the latter . Bring on citizen’s allowance.

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  • No, no, no, what you have just described is fascism / mercantilism.

    The tyrants pose as capitalists, but are not

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  • My goodness, that man just proposed Citizen’s Allowance!! The government to give you an allowance based on need, not work, sounds like Communism to me. And do you not know history, that “allowances” are always and everywhere distributed for political favour. For votes, for “benefits”.

    You think you could prostrate in front of government, be dependent on its teat, and that it would love you? No, it would hate and despise you, kicking you in the teeth whilst it kept more and more for itself, as in all tin-pot dictatorships!

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