Discussion about Communism continued

[stormthebeaches]

I must apologize for my long delay. I have been traveling and have been unable to access a good internet connection. I hope this isn't a necro.

First of all, "dictatorship" of the proletariat as Marx envisioned it was a fundamentally democratic rule by the workers (like the Paris Commune), through elected councilors.

Really? Because I don't see any mention of democracy whilst reading through the Communist manifesto. Could you point me too the page where he references democracy.

Besides, I have no idea why you think that "classless" means that all people get the same amount of money. This is not so. Class in Marxism is defined by the ownership of the means of production. A doctor and a street cleaner are both in the same class (worker class). A classless society does not envision everyone to be paid the same (in fact, such has never existed even in states with Communist parties in power).

That explains it. In Western terms class is defined by income and a doctor would be regarded as middle class, not working class.

(in fact, such has never existed even in states with Communist parties in power). In fact, there was a great difference between the pay of a menial worker and that of a nuclear scientist. I believe you know as much.

I am aware of that. I am also aware that all the Communist nations, including the Soviet Union, deviated from traditional Marxism in many ways. I assumed that the wage gaps were merely part of this deviation from traditional Marxism.

You have not adressed the fact that regardless of the social order, very poor nations with a liberal-democratic government have had an inferior living standard to richer, but dictatorial nations like, say, the USSR, which was also a key argument of mine (that the "flawedness" of a society is more than anything determined by relative richness) - if you gave the USSR a first-world per capita GDP, you can bet a great majority of its flaws would be gone.

The "flawedness" of a society is related to wealth. However, this goes both ways. A society that is rich but full of flaws will rapidly develop widespread poverty and income inequality and the wealth is swallowed up by the emerging elites. Likewise an ideal liberal democracy that has widespread poverty will soon develop flaws as the rich and powerful exploit things and use their power to change society so that it would benefit themselves. Saying that a society will be less flawed if it is richer is ignoring the fact that a flawed society will become poorer overall with the exception of a small amount of elites.

Even if Marx called for a democratic government, a society set up based on the Communist manifesto would still be horribly flawed. Marx called for the state to seize control of the means of communication. This would be a disaster as no democratic society can realistically function without an independent media. He also calls for the state to seize all means of production, transport and banking. This would cause economic inefficiencies as monopolies, be it state monopolies or corporate monopolies, are almost always inefficient.

Then there is the insane stuff Marx proposed, like abolishing the family unit and raising all children in state run orphanages...

Essentially you say that climate meant free labour was better suited for sustaining the worker than slave labour. Not some sort of fundamental superiority of free labour over slave labour. I am not sure what this is supposed to prove.

Agriculture never caught on in the North become of the climate. As for free labor versus slave labor, slave labor was effective in an agricultural society (don't know if it was better than free labor) but free labor was better in an industrial society. I mentioned this because I wanted to point out that America's industry used free labor, not slave labor.

However, a smart Marxist would also argue that slavery was fundamental in the accumulation of capital, i.e. in the creation of the class divide between the dispossessed who became the workers, and those who controlled the means of production, the capitalists. Slavery allowed to create a vast reserve of cheap labour which poured into the factories upon emancipation, and concentrate the means of production in the hands of the very few. It was a fundamental part of the history of capitalism and, indeed, without this period of accumulation of capital and all the associated vices (slavery, dispossession, fencing, colonial exploit and what people call "robbery of the colonies") modern capitalism could not have been born, a smart Marxist would say. And so would I.

You seem to be arguing that colonialization was necessary for industrialization in the capitalist countries. I would object to this. Many people on this thread have already pointed out that the link between colonialism and industrialization is weak. Likewise, I'm uncertain how slavery was related to industrialization considering that slavery was mainly used in agricultural societies. In America, slavery actually slowed industrialized due to the massive profits that could be made from the plantations in comparison to the more risky industrial business. Are you trying to say that slavery left a huge reserve of unemployed which could be recruited by the industrialists?

Rapid industrialization in North America (in the post-colonial epoch) had quite big a death toll, at least in what concerned canals and certain railroads (Erie and Rideau are just two I recalled straight away, as is the trans-Canadian railroad). Sure, it might have been smaller than in Russia, and climate can partly account for that too (it is far milder in Western Europe and North America than in Russia). Besides, I do not see a reason to arbitrarily exclude certain territories and necessary industrial projects (like e.g. the Suez Canal) from the overall process of industrialization. Because I could do the same trick and say that the White Sea Canal, for example, was built in a remote area of Russia that could technically amount to a useless and under-developed colonial territory (in fact, it was exactly that way, the territory was underdeveloped, the climate extremely harsh). But that would be fundamentally dishonest, would it not? Or I could say that the USSR's behavior resembled a colonial empire, and thus, for example, the famine in Ukraine could be described as a fundamentally colonialist vice.

You are missing the point here. I am arguing that massive deaths tolls for industrialization are unnecessary (I am just as opposed to the unnecessary deaths in colonial industrialization as I am the deaths under Stalin's industrialization). To argue this point I point towards the industrial revolution in Europe, where the death tolls were far less.

You said that all canals were built using free labour.

I never said that.

Drought, rain, and infestations destroyed no less than one-fifth of the harvest, what is disputed by historians is whether this, on its own, would be enough to cause a famine of such proportions.

One fifth of the harvest? In 1846 Ireland lost three quarters of its crop to the potato disease. This 60% of Irish crops were potato's this meant that the nation lost 45% of its crops in total http://en.wikipedia.org/wiki/Great_Famine_%28Ireland%29 (if wikipedia is a good enough source for you its a good enough source for me). Proportionally this would make the Irish potato disease more than twice as bad as the famine that hit Ukraine.

So having established that Ireland was hit by a worse disaster than Ukraine, lets examine that response of the respective leaders. Wikipedia (the source you used for Ireland being a net exporter of food) doesn't say that Ireland was a net exporter of food. It states that Ireland was exporting food but it doesn't state that it was a net exporter.

Wikipedia does, however, state that Ukraine was still exporting grain during the famine and that the grain exports were at roughly 1.8 million tons, which would have been enough to feed five million people for one year. http://en.wikipedia.org/wiki/Causes_of_ ... other_food This is excluding the criminalized gleaning.

These exports were huge, in comparison you have yet to provide me with a source stating that Ireland was even a net exporter during this time period.

The biggest causes of famine were British requisitions of food crops - as much as the natural factors. The harvest of 1943 was the same as that of 1941. If Britain did not behave the way it did, the famine could have been averted. Churchill, aside from his support for gassing the Kurds, also thought that Indians are lowly beastly people saved from "perishing which is their natural fate" only by their fertility, and that he didn't give a flying fuck if Indians died. He repeatedly displayed this attitude. And yes, he has less responsibility for the famine, but he also had less power as you yourself noted. More power means more responsibility, it is the backside. However, it seems that no checks and balances prevented the famine, even if they did make Churchill less responsible for it. However, the little or big responsibility of Churchill means jack shit as to the outcome, which is the same.

Burma (Indian's main supply root for food) had been seized by Imperial Japan, this was a disaster because Burma was the British empire's largest exporter of food and was the main supply root for India. True, Britain did keep exporting food but Britain was in the middle of a little event known as World War 2. In comparison, when Holodomor was occurring, the Soviet Union was not fighting in any major wars.

My point about Churchill not having the power that Stalin did was to counter your point about Churchill being as bad as Stalin. Not only did Churchill not have the control over Great Britain that Stalin did over the USSR due to the system of checks and balances (management of India was left almost entirely to local administrators) but the British empire bears less responsibility for the Indian famine due to the fact that they were fighting World War 2 and that Imperial Japan had seized the British empire's main supply root for Indian. And before you shout hypocrisy I shall point out that I don't blame Stalin for the famine that happened in 1947 because I recognize that Soviet infrastructure was battered after WW2.

The vastest majority of Soviet deportations were internal, rather than external. According to your own logic, that is better than kicking people out of the country, no? In any case, the USA deported legal immigants as well, in case you did not know:
http://en.wikipedia.org/wiki/Mexican_Repatriation
That was a massive deportation, of whom 60% were U.S. citizens.

So I was wrong about the USA.

I think you know too little about the history of your own nation which conducted such a massive deportation of its own citizens.

I'm not American. I find it quite arrogant that you would assume someone who is opposed to Communism would be an American. European history books don't focus on pre-world war 2 American history that much. The emphasis is on European history.

Now, what was your point again? The USSR being the only nation to employ massive population transfer, or something more subtle? If you think that other major powers are free of such actions, why not remember the British Empire and such a stellar act as the deportation of Acadians or various deportation in the territories it ruled? Or, for that matter, the Russian Empire and its million-high deportation of Jews and Germans?

I'm not entirely sure what my point was either considering that you are the one putting words in my mouth. I never said that the USSR was the only country to use deportations so I'm not sure why you are bringing these examples up.

In the other thread the OP claimed that no mass deportations happened under Communist regimes. I told him that he was wrong and pointed to several examples, you then claimed that every country made up of mass deportations including the USA. I said that the USA's mass deportations were never on the scale of Stalin. It turns out that I was wrong. What can I say, pre-world war 2 American history is rarely looked at where I come from.

[K. A. Pital]

I must apologize for my long delay. I have been traveling and have been unable to access a good internet connection. I hope this isn't a necro. ... Because I don't see any mention of democracy whilst reading through the Communist manifesto. Could you point me too the page where he references democracy.

Why would you apologize? I'm travelling all the time and my internet can fall out for months. As for democracy, actually, it is mentioned, I believe, but primarily not in the manifesto. Marx explained that only worker representatives elected through universal suffrage can constitute a worker government (dictatorship of the proletariat), and elections are a fundamentally democratic mechanism.

That explains it. In Western terms class is defined by income and a doctor would be regarded as middle class, not working class.

Yeah, I know, it is quite confusing. The Marxist concept of class has nothing to do with income. A capitalist can be dirt-poor (if he's in debt) and a worker theoretically rich, and they'd still belong to their respective classes because one ownes means of production and the other does not. Traditional Marxism does not assume equal pay for all, I believe, and neither do most variants (except the most extreme Maoist movements, perhaps).

Saying that a society will be less flawed if it is richer is ignoring the fact that a flawed society will become poorer overall with the exception of a small amount of elites.

Actually, it is not that important. The inequality in America is pretty atrocious, but due to it's First World status and accumulated wealth, a poor person in America is in a better position than a poor person in the Third World. The flawed society not necessarily becomes poorer if it becomes more flawed, it just gets a poor underclass, which gets little attention and little political power. Many nations exist in such a state.

Marx called for the state to seize control of the means of communication. This would be a disaster as no democratic society can realistically function without an independent media. He also calls for the state to seize all means of production, transport and banking. This would cause economic inefficiencies as monopolies, be it state monopolies or corporate monopolies, are almost always inefficient. Then there is the insane stuff Marx proposed, like abolishing the family unit and raising all children in state run orphanages...

A state monopoly has advantages stemming from a massive economy of scale, and if said advantage weighs over the possible inefficiencies in distribution, there is a net benefit from the state monopoly to the society. As for abolishing family - the XIX century family that Marx witnessed was a nightmarish social construct where females were exploited almost like property (I've recently found out that "rape in marriage" was not a crime in some First World nations apparently). The family certainly underwent a huge reform and I also believe there's fewer families now than there were in the past in certain segments of the population, especially in advanced First World nations.

I mentioned this because I wanted to point out that America's industry used free labor, not slave labor ... Are you trying to say that slavery left a huge reserve of unemployed which could be recruited by the industrialists?

Oh, doubtlessly it did, and so did many other industries. My point was more along the lines of slavery leaving a huge army of destitute people - slave labour was not the key element, but released slaves, who were almost always destitute and thus more often fell into the underclass, became part of the necessary army of cheap labour which was used in early industrialization. Other parts of this massive army were destitute migrants (e.g. Irish and Chinese) who died in dozens of thousands building stuff. So while slavery itself was destroyed by capitalism and was antagonistic to the labour market concept, its prior existence was conducive to creating the army of proletarians, cheap people to be used for industrial projects.

You are missing the point here. I am arguing that massive deaths tolls for industrialization are unnecessary (I am just as opposed to the unnecessary deaths in colonial industrialization as I am the deaths under Stalin's industrialization). To argue this point I point towards the industrial revolution in Europe, where the death tolls were far less.

Europe started industrializing very early and it is hard to find the data on how many people died here and there. It is slightly easier with America, and the death toll seems to be massive enough. North America does not count because it was a colony too?

As for quoting Wikipedia - I object to that. Especially if you can't read your own source:

Ireland remained a net exporter of food throughout most of the five-year famine.[fn 4]

So it does state this quite plainly. I said it is doubtful now, but I am not sure if it was this way or the other way.

Sorry for suggesting you are an American. I think in a few threads about American politics and stuff I saw your name, and you were asking about stuff that is relevant to American politics only. Serves me right for making such a huge leap.

[Samuel]

Agriculture never caught on in the North become of the climate.

I'm going to assume you mean plantations and cash crops because the North was well known for its wheat production (ironically Marx tells Engels this is why England would not intervene to support the South).

slave labor was effective in an agricultural society (don't know if it was better than free labor)

It wasn't. Slave labor worked best when it could be easily supervised and slaves had very strong incentives to shirk, destroy tools or pretend to be sick.

As for abolishing family - the XIX century family that Marx witnessed was a nightmarish social construct where females were exploited almost like property (I've recently found out that "rape in marriage" was not a crime in some First World nations apparently).

Spousal rape was first banned in the US is 1975 by South Dakota. I believe the first country was Poland in 1932.

My point was more along the lines of slavery leaving a huge army of destitute people - slave labour was not the key element, but released slaves, who were almost always destitute and thus more often fell into the underclass, became part of the necessary army of cheap labour which was used in early industrialization.

In the US free blacks often became sharecroppers. They didn't provide cheap labor for industrial projects, in part because of their low mobility and the comparitice lack of investment in the south.

[K. A. Pital]

In the US free blacks often became sharecroppers. They didn't provide cheap labor for industrial projects, in part because of their low mobility and the comparitice lack of investment in the south.

I see. Serves me right for extrapolating Russia's post-serfdom situation to America. However, weren't the free slaves employed in industrial projects in the South still (like e.g. Louisiana's dams, canals, etc.)?

[Samuel]

In the US free blacks often became sharecroppers. They didn't provide cheap labor for industrial projects, in part because of their low mobility and the comparitice lack of investment in the south.

I see. Serves me right for extrapolating Russia's post-serfdom situation to America. However, weren't the free slaves employed in industrial projects in the South still (like e.g. Louisiana's dams, canals, etc.)?

I don't know, but I don't think it is a good argument- the American South remained backwards compared to the rest of the country until after world war 2. I believe it had a GDP per capita of only 60% the national average. I'm not at home so I can't check the figure, but I'm pretty sure it is accurate- it really stuck out to me.

[K. A. Pital]

In the US free blacks often became sharecroppers. They didn't provide cheap labor for industrial projects, in part because of their low mobility and the comparitice lack of investment in the south.

I see. Serves me right for extrapolating Russia's post-serfdom situation to America. However, weren't the free slaves employed in industrial projects in the South still (like e.g. Louisiana's dams, canals, etc.)?

I don't know, but I don't think it is a good argument- the American South remained backwards compared to the rest of the country until after world war 2. I believe it had a GDP per capita of only 60% the national average. I'm not at home so I can't check the figure, but I'm pretty sure it is accurate- it really stuck out to me.

Perhaps then the fact that former slaves were used to build railroads in Virginia, Blue Ridge and Central Virginian RR being obvious examples, would be a better argument? I believe the extent of use of slave and former-slave labour in U.S. industrialization is an obscure topic not well researched for political reasons. I shall look into that further, and come back when I have more to say than the above two examples.

[Thanas]

A much better example would be the masses of black slaves ending up in the north and working in the new industrial centers like Detroit and New York.

[K. A. Pital]

A much better example would be the masses of black slaves ending up in the north and working in the new industrial centers like Detroit and New York.

Well, that certainly goes against the "low mobility" thesis.

[Thanas]

Why? It does not have to be an either or and keep in mind, this happened several decades after the civil war.

[Simon_Jester]

Former slaves who wind up as sharecroppers are still part of the labor pool; you can't have a proletarian army without growing grain to feed it and cotton to clothe it.

One question (which I am not qualified to answer) is whether the sharecroppers of the South were a significant exporter of food, to the point where they would be indirectly contributing by their labor to the great industrial projects even if they did not physically swing pickaxes on those projects. Since they routinely paid their rent in produce from their land (hence the name), it seems likely to me, but I don't know where to begin when it comes to researching the question.

On the other hand, if the sharecroppers were near-subsistence farmers, then they would not be contributing materially to the great industrial projects.

[Iosef Cross]

I had decided to exclude myself from this, but now I am on my last vacations, so I have enough free time to burn.

Oh my god. This communist thing has gone too far here. With mister Bush advocating the state control of the media because "A state monopoly has advantages stemming from a massive economy of scale, and if said advantage weighs over the possible inefficiencies in distribution, there is a net benefit from the state monopoly to the society." This is highly questionable to say the least! It is quite sad too, since it still shows how much Marxism is alive (even if people doesn't say they are Marxists, they can be heavily influenced by him), even though pretty much everything that Marx said was proven wrong or at least a greatly distorted vision of reality on several levels.

Socialism (defined as the central control of economic activity by a single central organization) doesn't work. That's one thing that everybody with some basic notions of social science should know, but apparently, many don't. The reason is simple enough: Information is dispersed in society, since society is a collection of millions of individuals, each individual has some information and some capacity to process information. A workable social order must use the existing information and capacity to process it that is dispersed though millions of individuals. Hence, a workable social order must be decentralized and socialism (or call it communist, if you like, as some people without culture do) by definition isn't. As result, it is not capable of producing a social order more complex than what can exist in the mind of a single or a small group of individual (the central planning board).

Of course, no society in history ever became truly socialist, since it is impossible to even implement it: you would need to completely remove all freedom of decision making from any shopkeeper and factory manager, etc, in the country and isolate the country for the rest of the world, since any contact with the world market would transform the country into an individual operating in the world market, and not a closed true socialist economy. Anyway, the USSR never was a socialist country, it was closer to a mercantilistic market economy, where the freedom of individual decision makers were severely restricted by the state, as result it's economic system was much less efficient than in the "freeworld" and eventually, it collapsed, naturally due to it's own failure to stay competitive, due to the lack of dynamism of their industries, caused justly by the lack of freedom in decision-making inside each firm.

Also, Marx never provided a blueprint of how a socialist society would work, and also he didn't provide a precise definition of it. Today some authors, like Theodore A. Burczak, better informed by the advances in economics, have proposed some type of "socialism" where "exploitation" is avoided in a market economy because it becomes impossible for workers to sell their labor, the economy is run by cooperatives immersed in a market, but without conventional firms that hire and fire workers. He thought that there would be exploitation in a conventional wage arrangement because the worker sells his labor, but retains his responsibility, as result the capitalist captures the surplus of his labor, while the laborer still holds the responsibility for creating the surplus. I found the argument a bit unconvincing and the implementation of such a system would be terrible, as it would make impossible for conventional entrepreneurship to arise, and conventional entrepreneurship is the driving force of progress in modern society.

Back to mister Bush argument that a government monopoly would be efficient because of "economies of scale", one first must understand that you can have economies of scale and diseconomies of scale. Historically, the USSR suffered from diseconomies of scale. There is something called "optimal scale", where production up to this point has economies of scale and production beyond this point has diseconomies of scale. The optimal scale is given by technological constrains. In some segments of industry, the optimal scale is quite large, like in the motor vehicle sector, while in other segments, it is quite small, like in the bakery segment. The competitive process tends to adapt the size of the firms to the optimal scale of each segment.

A government monopoly in a certain segment would have the same or worse effects than a private monopoly backed by the government. A monopoly is inefficient because if the market is blocked some information that other entrepreneurs might have about improvements in the segment is neutralized. As result, that segment loses dynamism and with time becomes increasingly inefficient. A state run monopoly can be even worse than a private monopoly if it is not profit driven, because the employees of this firm also don't have any incentives to maximize productive efficiency, since the gains of public employees aren't connected with the costs of production.

[Iosef Cross]

Germany did not industrialize later due to lack of colonies, it industrialized later due to a lack of enclosures and a later liberalization of the farming laws (which up to then prevented the rise of a worker class) and due to political disunity resulting in such high tariffs that it become unprofitable to trade in goods.

So a lack of enclosures was a break on German industrialization? Heh. I wonder how Kane or storm would answer to that. They were ardently defending the idea that enclosures and destitute people to form a worker class are not important for industrialization.

In Britain's case, it was.

The process of fast economic growth that characterized Britain during the period know as industrial revolution was not because a class of destitute people was "created" by the enclosures. Enclosures only substituted the highly inefficient peasant run farms by modern market run farming, that increased productivity. Anyway, productivity was higher in the cities than in the country in the 18th century Britain, and higher productivity increases the vale of labor, with increased the incentives for the population to move to the cities.

In Germany's case, people wanted to emigrate to the cities long before this, but they were prevented by law. Only when those laws were lifted and new production methods made the farming of large-scale lands possible was there enough incentive to move to the cities - first a population and productivity increase (meaning more children of farmers looking for more jobs), heavy taxation in some areas (aka I want a new castle, raise taxes on the peasants) and of course liberalization (aka I can suddenly legally make and sell shoes etc.)

In other words: industrialization happened in Germany because the chains that enclosed the operation of the market were lifted. That's pretty much the same reason for all countries. In Brazil, the process of fast economic growth started around 1916, when the modern civil code, with protected private property rights, was first implemented. In China, only in 1978, with the "privatization" of the farms.

[Thanas]

The process of fast economic growth that characterized Britain during the period know as industrial revolution was not because a class of destitute people was "created" by the enclosures. Enclosures only substituted the highly inefficient peasant run farms by modern market run farming, that increased productivity. Anyway, productivity was higher in the cities than in the country in the 18th century Britain, and higher productivity increases the vale of labor, with increased the incentives for the population to move to the cities.

Do you deny that enclosures resulted in people having no work and being destitute, moving to the cities? If so, what are your sources?

In other words: industrialization happened in Germany because the chains that enclosed the operation of the market were lifted. That's pretty much the same reason for all countries.

No, it also happened due to a multitude of other reasons and certainly not because the market suddenly became free, as full freedom was only achieved with the tariffs union and the creation of the German Empire, which happened a few decades later than industrialization.

[Iosef Cross]

The process of fast economic growth that characterized Britain during the period know as industrial revolution was not because a class of destitute people was "created" by the enclosures. Enclosures only substituted the highly inefficient peasant run farms by modern market run farming, that increased productivity. Anyway, productivity was higher in the cities than in the country in the 18th century Britain, and higher productivity increases the vale of labor, with increased the incentives for the population to move to the cities.

Do you deny that enclosures resulted in people having no work and being destitute, moving to the cities? If so, what are your sources?

That's the argument usually put forth by historians. The problem is: historians don't know shit about economics, and some understanding of economics is required to understand the nature of the "industrial revolution".

You don't need to read history books to know that this argument is incorrect. This argument doesn't implies that the workers need to go to the cities because they were destitute. A unemployed worker could work for a private farm for a wage. Why they didn't do it in Britain? Because the labor productivity in the cities was higher than in the countryside, as result employment opportunities were better there. It's the same reason why Mexicans immigrate to the US: because real wages in the US are 3-4 times higher than in Mexico for manual labor.

Entrepreneurs discovered that they could convince workers to work for you paying very low wages, because in Britain in the 18th century, agricultural productivity was very low, so the opportunity cost for working in the cities was low.

In other words: industrialization happened in Germany because the chains that enclosed the operation of the market were lifted. That's pretty much the same reason for all countries.

No, it also happened due to a multitude of other reasons and certainly not because the market suddenly became free, as full freedom was only achieved with the tariffs union and the creation of the German Empire, which happened a few decades later than industrialization.

There were many institutional changes that created the modern institutions like the rule of law and the protection of contracts and these changes happened over centuries. As these institutions evolved, the speed of economic progress increased. There wasn't a clear cut line between industrialization and agricultural economy. Germany's rate of economic growth increased between 1815 and 1914, and the period from 1880 to 1914 had faster rates of progress than any previous periods.

The greater is the degree of development of contractual relations, the protection of property and the development of the financial system, the smoother is the operation of the process of entrepreneurial innovation and therefore, the long run rate of economic progress. The development of enclosures in UK helped to increase the rate of economic growth, by advancing the protection of private property.

[Thanas]

The process of fast economic growth that characterized Britain during the period know as industrial revolution was not because a class of destitute people was "created" by the enclosures. Enclosures only substituted the highly inefficient peasant run farms by modern market run farming, that increased productivity. Anyway, productivity was higher in the cities than in the country in the 18th century Britain, and higher productivity increases the vale of labor, with increased the incentives for the population to move to the cities.

Do you deny that enclosures resulted in people having no work and being destitute, moving to the cities? If so, what are your sources?

That's the argument usually put forth by historians. The problem is: historians don't know shit about economics, and some understanding of economics is required to understand the nature of the "industrial revolution".

Are you freaking kidding me? Economy historians do require a degree in economics, in fact the professor for it at my university has a doctorate in it. Economy historians, just as legal historians, have degrees in the relevant field as well as in history.

Freaking ignoramus, that is what you are.

Oh, btw, I now require to see your doctorate in economics. After all, you must know more about the stuff than the historians, right?

You don't need to read history books to know that this argument is incorrect.

Ah, so the scores of diaries and government reports we have are simply lying, right?

This argument doesn't implies that the workers need to go to the cities because they were destitute. A unemployed worker could work for a private farm for a wage. Why they didn't do it in Britain? Because the labor productivity in the cities was higher than in the countryside, as result employment opportunities were better there. It's the same reason why Mexicans immigrate to the US: because real wages in the US are 3-4 times higher than in Mexico for manual labor.

Entrepreneurs discovered that they could convince workers to work for you paying very low wages, because in Britain in the 18th century, agricultural productivity was very low, so the opportunity cost for working in the cities was low.

Bullshit. You are regurgitating stuff without a single source or thought behind it. Cite a peer-reviewed study to back you up because you are pretty much arguing against a century or so of scholarship right here.

There were many institutional changes that created the modern institutions like the rule of law and the protection of contracts and these changes happened over centuries. As these institutions evolved, the speed of economic progress increased. There wasn't a clear cut line between industrialization and agricultural economy. Germany's rate of economic growth increased between 1815 and 1914, and the period from 1880 to 1914 had faster rates of progress than any previous periods.

Again, cite a study. Because what you are saying here does not prove your point or is disproved by every expert in the field. (BTW, even if there was not a clear cut line, that is immaterial to the point, as one cannot have one without the other, being in this case a surplus of workers).

[Samuel]

A government monopoly in a certain segment would have the same or worse effects than a private monopoly backed by the government. A monopoly is inefficient because if the market is blocked some information that other entrepreneurs might have about improvements in the segment is neutralized. As result, that segment loses dynamism and with time becomes increasingly inefficient. A state run monopoly can be even worse than a private monopoly if it is not profit driven, because the employees of this firm also don't have any incentives to maximize productive efficiency, since the gains of public employees aren't connected with the costs of production.

Wait, what? A state monopoly is better than a private monopoly because private monopolies restrict supply in order to increase profits, something state monopolies tend not to do.

[Iosef Cross]

Do you deny that enclosures resulted in people having no work and being destitute, moving to the cities? If so, what are your sources?

That's the argument usually put forth by historians. The problem is: historians don't know shit about economics, and some understanding of economics is required to understand the nature of the "industrial revolution".

Are you freaking kidding me? Economy historians do require a degree in economics, in fact the professor for it at my university has a doctorate in it. Economy historians, just as legal historians, have degrees in the relevant field as well as in history.

Freaking ignoramus, that is what you are.

I see, you are entitled to your opinion. The problem is that in this tread I saw enough ignorance to puke.

Oh, btw, I now require to see your doctorate in economics. After all, you must know more about the stuff than the historians, right?

1- I don't have a doctorate in economics. I have a BS (earned it last week!), my PHD comes in 5 years.

2- Anyway, today scholarship into economic history is much better than it was 100 years ago, these ideas were implanted into the profession before economic historians learned economics. If your economic history professor has a PHD and explicitly said that the creation of a class of destitutes directly helped the British industrial revolution, he is wrong. He can have a nobel prize in economics and still say bullshit, like Paul Krugman.

You don't need to read history books to know that this argument is incorrect.

Ah, so the scores of diaries and government reports we have are simply lying, right?

Lying about what?

The creation of a class of destitute people could occur during the industrial revolution, however, it didn't help it. I am not saying that there wasn't a proportion of the British population in terrible living conditions, but that the creation of this population didn't help the process of economic growth that characterizes the industrial revolution.

I can disprove that by the application of economic theory (i.e. the fact that the creation of a class of destitutes doesn't imply that they would migrate to the cities).

This argument doesn't implies that the workers need to go to the cities because they were destitute. A unemployed worker could work for a private farm for a wage. Why they didn't do it in Britain? Because the labor productivity in the cities was higher than in the countryside, as result employment opportunities were better there. It's the same reason why Mexicans immigrate to the US: because real wages in the US are 3-4 times higher than in Mexico for manual labor.

Entrepreneurs discovered that they could convince workers to work for you paying very low wages, because in Britain in the 18th century, agricultural productivity was very low, so the opportunity cost for working in the cities was low.

Bullshit. You are regurgitating stuff without a single source or thought behind it. Cite a peer-reviewed study to back you up because you are pretty much arguing against a century or so of scholarship right here.

Scholarship that argues that the process of migration to the cities wasn't voluntary? Yes, workers went to the cities because the employment opportunities were there.

The creation of enclosures could have decreased the demand for labor in agriculture, as the private run farms were more productive and the demand for food is inelastic in respect to price, as result the increase in productivity decreases the demand for labor and labor is freed to work in industry and services. Since industry and services were located mostly in cities, the creation of enclosures helped to increase the migration to the cities. That's true.

What's untrue is that the class of workers that lost their jobs because they failed to anticipate the market (the "destitutes") that helped to ignite the industrial revolution. If they had correctly anticipated the job market, they would have migrated to the cities sooner and would never stayed unemployment. Usually, it is the Marxist interpretation of history that claims that the creation of destitutes helped the industrial revolution, Hayek's book: http://www.amazon.com/Capitalism-Histor ... 0226320723, helps to clear these putrid intellectual waters a little.

There were many institutional changes that created the modern institutions like the rule of law and the protection of contracts and these changes happened over centuries. As these institutions evolved, the speed of economic progress increased. There wasn't a clear cut line between industrialization and agricultural economy. Germany's rate of economic growth increased between 1815 and 1914, and the period from 1880 to 1914 had faster rates of progress than any previous periods.

Again, cite a study. Because what you are saying here does not prove your point or is disproved by every expert in the field. (BTW, even if there was not a clear cut line, that is immaterial to the point, as one cannot have one without the other, being in this case a surplus of workers).

Again, you say: "surplus of workers". This concept is meaningless for modern economic theory. How can I approve a theory like that? That simply ignores all research in economic theory of the last 300 years?

Also, you say that the industrial revolution "needed" a "surplus of workers", clearly, you base your ideas in a very crude theoretical understanding of economics. It needs to be improved. Read: Microeconomic Thoery (http://www.amazon.com/s/ref=nb_sb_noss? ... ry&x=0&y=0)

[Iosef Cross]

A government monopoly in a certain segment would have the same or worse effects than a private monopoly backed by the government. A monopoly is inefficient because if the market is blocked some information that other entrepreneurs might have about improvements in the segment is neutralized. As result, that segment loses dynamism and with time becomes increasingly inefficient. A state run monopoly can be even worse than a private monopoly if it is not profit driven, because the employees of this firm also don't have any incentives to maximize productive efficiency, since the gains of public employees aren't connected with the costs of production.

Wait, what? A state monopoly is better than a private monopoly because private monopolies restrict supply in order to increase profits, something state monopolies tend not to do.

You are using the standard monopoly theory of Cournot, a theory about 200 years old. Modern microeconomic theory has evolved past it, though it is still taught. Also, this theory doesn't assume that public monopolies would be benevolent.

You are assuming that: Private monopolies and public monopolies have perfect information (wrong in practice), that they can only set 1 price (also wrong) and that private monopolies maximize profits (true), while public monopolies practice marginal cost pricing (untrue). Public monopolies are as selfish as private monopolies, and they don't have any incentives to reduce costs (they can operate with losses and the government pays them back with money from taxes).

Modern game theory shows that mutually beneficial trade doesn't takes place when information is imperfect. To maximize efficiency, you need to maximize the utilization of dispersed information. If monopolies had perfect information, they could simply discriminate prices and achieve perfect efficiency to maximize profits. The core problem of economics is information, as Hayek perceived in 1937.

You are using the standard assumption of the naive interventionist: that the government is benevolent and omniscient. The concept that government is omniscient was refuted (as if it needed to be refuted!) by Hayek (nobel prize in 1974) and the concept that governments are benevolent (that they maximize public good) was refuted by the Public Choice theory, whose master is James Buchanan, nobel prize in 1986. You also should evolve your defense of government intervention beyond the microeconomics 101, or become a liberal, like me.

[Thanas]

I see, you are entitled to your opinion. The problem is that in this tread I saw enough ignorance to puke.

Indeed, most of that coming from this one idiot called Iosef Cross.

1- I don't have a doctorate in economics. I have a BS (earned it last week!), my PHD comes in 5 years.

2- Anyway, today scholarship into economic history is much better than it was 100 years ago, these ideas were implanted into the profession before economic historians learned economics. If your economic history professor has a PHD and explicitly said that the creation of a class of destitutes directly helped the British industrial revolution, he is wrong. He can have a nobel prize in economics and still say bullshit, like Paul Krugman.

I know people who have spent their life working about this. Do you think this stuff is not researched over and over again? And that old assumptions are not continously challenged? You really know nothing about how real science works. Unless you want to claim that a guy in his thirties is actually way way older. And justify your claim that this became "implanted" before historians learned economics.

Quit slandering a profession and start proving your point.

Lying about what?

The creation of a class of destitute people could occur during the industrial revolution, however, it didn't help it. I am not saying that there wasn't a proportion of the British population in terrible living conditions, but that the creation of this population didn't help the process of economic growth that characterizes the industrial revolution.

Why not? Cite a peer reviewed study that disproves this.

I can disprove that by the application of economic theory (i.e. the fact that the creation of a class of destitutes doesn't imply that they would migrate to the cities).

Ah, so why do the records say they do? Again, cite a peer reviewed study that is accepted in the field that proves this point.

What's untrue is that the class of workers that lost their jobs because they failed to anticipate the market (the "destitutes") that helped to ignite the industrial revolution. If they had correctly anticipated the job market, they would have migrated to the cities sooner and would never stayed unemployment. Usually, it is the Marxist interpretation of history that claims that the creation of destitutes helped the industrial revolution, Hayek's book: http://www.amazon.com/Capitalism-Histor ... 0226320723, helps to clear these putrid intellectual waters a little.

Please give a full cite and the sources Hayek uses.

Again, you say: "surplus of workers". This concept is meaningless for modern economic theory. How can I approve a theory like that? That simply ignores all research in economic theory of the last 300 years?

Also, you say that the industrial revolution "needed" a "surplus of workers", clearly, you base your ideas in a very crude theoretical understanding of economics.

I just love how you tell guys with doctorates in economics and five-year degrees that they ignore all research. Are you that full of yourself?

But fine. So here's a challenge. Explain the industrialization process in Germany, using sourced data, models etc. Are you up to that or are you full of hot air?

[Thanas]

Oh, btw, idiot, if you want to take swings at Krugman, do so in the N&P or SLAM forums.

[Samuel]

that private monopolies maximize profits (true), while public monopolies practice marginal cost pricing (untrue).

No I'm not assuming that- marginal cost pricing doesn't work because it discounts fixed costs.

If monopolies had perfect information, they could simply discriminate prices and achieve perfect efficiency to maximize profits.

Even if a company had perfect information, the lowest price individual would buy enough for everyone and make a profit selling to everyone else. A good has to be non-resaleable for perfect information to help.

You are using the standard assumption of the naive interventionist: that the government is benevolent and omniscient.

Private company sets price at monopoly price.
Public company sets price less than monopoly price.
Therefore welfare is higher under a public company. This doesn't require the government to be benevolent or omniscient, just to be efficient enough so that it can excede the activity of private companies.

[K. A. Pital]

Iosef, oh Iosef. I believe the discommunication between you and Thanas occured because Brazil's shitty education system is not on par with Germany, a First World nation, where historians actually hold relevant degrees, unlike your pathetic idea that economists can be thought of as reasonably educated to make judgements on history without a relevant degree.

Again, you say: "surplus of workers". This concept is meaningless for modern economic theory. How can I approve a theory like that? That simply ignores all research in economic theory of the last 300 years?

Idiot thinks that modern economics has no works related to labour surplus economies. Idiot Cross once again fails miserably. Why not point him to this nice paper: LABOR SURPLUS ECONOMIES, Gustav Ranis, Yale University, December 2004. Idiot Cross thinks that if the neoclassical theory says something, that must be true. Problem is, the neoclassical theory has many issues that it cannot solve. The historical analysis of labour-surplus economies and their behaviour, which does not exactly fit the neoclassical theory, is one of these problems. I will quote:

Perhaps even more relevant, there is evidence, not only for Taiwan, Korea, and Thailand but also for post-enclosure England between 1780 and 1840 and for post-Restoration Japan between 1870 and 1920, indicating substantial increases in agricultural labor productivity, while both agricultural and non-agricultural unskilled real wages were rising only gently, until commercialization was reached and wages began to rise steeply in line with rising marginal productivity. Thus, both historical and twentieth century development patterns are inconsistent with the neoclassical school’s one-sector full employment equilibrium assumptions.

Hayami and Kikuchi (1982), basically neoclassical in outlook, find that in Indonesia “wages do not adjust on the basis of labor’s marginal product, but according to the subsistence requirements of the time and social conventions.”

I am sorry, Iosef, but contrary to your idiotic view, economics is a practical discipline much more so than just a theoretic one. If practice fails to show evidence for a theory, it is modified, which is the scientific way (ergo the existence of behavioural, development, etc. economics which mostly close whatever deficiencies a dogmatic neoclassical approach would have). Economic science is much more diverse than our Friedmanite friend would have us believe.

I believe, Iosef, if you weren't so dogmatic in your assumptions that your bachelor degree and neoliberal dogma are the end of all science, you'd be a much more worthwhile contributor and you wouldn't get into a conflict whenever you post. No offense. I believe it's just a problem of youth. Once you get older, you'll stop stating your own opinions as if they were fact and learn the difference between a fact of hard science and your opinion.

However, if you wish to have a serious debate on whether enclosures were a necessary source of cheap labour for the Industrial Revolution (using historical facts, obviously, and not your own convictions), that could be worthy of it's own thread here in History. Tell me and I'll make a relevant split. If not, we'll go on here.

...one first must understand that you can have economies of scale and diseconomies of scale. Historically, the USSR suffered from diseconomies of scale. There is something called "optimal scale", where production up to this point has economies of scale and production beyond this point has diseconomies of scale. The optimal scale is given by technological constrains. In some segments of industry, the optimal scale is quite large, like in the motor vehicle sector, while in other segments, it is quite small, like in the bakery segment. The competitive process tends to adapt the size of the firms to the optimal scale of each segment.

Iosef correctly notes that tech constraints can cause diseconomies of scale. What he fails to note (either by voluntary omission, or he's simply too dumb to grasp that) is the fact that ownership and the scale of the manufacturing complexes are two different issues. Fast food chains and bakeries have small-scale, separated production facilities, but they are large companies. Bakeries are usually just outlets of a large company. So while the tech process constrains the size of a factory/plant/facility, it does not constrain ownership. McDonalds hardly suffers from "diseconomies of scale".

[Elfdart]

In the US free blacks often became sharecroppers. They didn't provide cheap labor for industrial projects, in part because of their low mobility and the comparitice lack of investment in the south.

I see. Serves me right for extrapolating Russia's post-serfdom situation to America. However, weren't the free slaves employed in industrial projects in the South still (like e.g. Louisiana's dams, canals, etc.)?

Sort of: The most menial and/or dangerous work was reserved for "free" blacks -usually convicts* leased out by the state for money. This rent-a-slaveconvict program was so brutal that in Mississippi and Louisiana, judges usually didn't bother handing out sentences greater than ten years because so few inmates survived that long. There's a very good book by David Oshinsky called Worse Than Slavery about Parchman, a sub-tropical gulag in Mississippi.

*Most of these convicts were in prison for the "crime" of being black, or some trumped-up bullshit charge like vagrancy.

Other black workers were mostly consigned to the lower-end jobs as well. Those who complained... see above.

Serves me right for extrapolating Russia's post-serfdom situation to America.

That's just it: Sharecropping really was serfdom and it says a lot about the brutality of chattel slavery that such a cruel system was considered an improvement.

[Elfdart]

A much better example would be the masses of black slaves ending up in the north and working in the new industrial centers like Detroit and New York.

Well, that certainly goes against the "low mobility" thesis.

There are different degrees of mobility. Even with the abolition of slavery, as a practical matter blacks could not (or would not) pick up and move unless they were absolutely forced to since traveling was extremely dangerous for them. The two biggest waves of black migration from South to North occurred during and immediately after the Civil War, and during the 1920s when a combination of the Great Mississippi Flood of 1927 and a wave of lynchings and what can only be described as pogroms caused a million or more terrorized blacks to flee to the North. This was after all the era when the KKK was at its strongest.

[RedImperator]

Adding somewhat to what Elfdart said, free blacks in the first fifty years after Emancipation were mostly locked out of the industrial workforce, north and south. They simply weren't hired for those jobs; in the northern cities, European immigrants and poor natives largely took that work, and in the few industrial centers in the south, displaced yeoman white farmers took them (yeoman white farmers who went bust in part because they couldn't compete against big planters and their armies of sharecroppers).