Part 2 of a 2 Part Pine WOT Series!Quote from: Hungry ghost on October 05, 2012, 11:41 am  In fact, improved working conditions in the real world are strongly correlated with strong labour unions, good regulations, a welfare state and minimum wage ( contrary to the predictions of industry, introducing minimum wages doesn't seem to cause an increase in unemployment). Look at the difference between the US and the UK. Historically the UK has had a stronger welfare system, and more active trade unions. Workers in the UK get a statutory 6 weeks paid holiday every year, compared to 2 weeks in the US. Our American cousins are expected to work harder for longer hours for less pay.Here I nearly rage-quit, but I continue! 1. Workers in the UK don't actually get paid as well as their American counterparts. Median household income (the "big picture" as opposed to straight wages since that wouldn't factor in people not working directly) was 25k (UK) and 31k (USA). Source: https://en.wikipedia.org/wiki/Median_household_income2. It is true that the US has shorter holiday time on average (five days according to one chart), but then again the unemployment in the US is lower and taxes are considerably lower, partly because there is no VAT tax but also more generally. The result is that purchasing power parity is such that a US citizen living in the UK would have to spend 34% more in order to attain a comparable standard of living. https://en.wikipedia.org/wiki/Purchasing_power_parity#OECD_comparative_price_levelsSo don't start feeling sorry for us just yet, thanks.--I'm not going to discuss trade unions and whatnot, because it's a whole other discussion, but on the issue of the min wage, you manage to make pine scowl. The majority of economists, for a long time now, have agreed that the minimum wage, if made higher, increases unemployment. There are technicalities and caveats to go along with that assessment of course, but that's the general picture.I mean, this is so widely accepted among economists that it's not even a left/right thing. Depending on what survey you're looking at, 50% - 90% of economists agree with this. It's only a big controversy politically, not economically.The minimum wage is a horrible horrible idea.I much prefer the idea of a basic income, (as was Hayek and Friedman). A basic income is where everybody receives, non income assessed (you can of course hand it back if you don't want it) quantity of money per citizen, sufficient to feed, clothe etc. The quantity of tax necessary to make that work is absolutely tiny, but the social advantage is clear and it prevents disruption to the labor market. This is contrary to the insanity that is your UK welfare system, where if you add up all the income taxes and subtract all the welfare entitlements paid out, you generate a negative number. :oIt is not that the welfare apparatus is especially benevolent to UK citizens either. It is that the entire thing is so hugely expensive that it swallows up more capital than it processes. You have the most inefficient model of welfare in the world. Quote from: Hungry ghost on October 05, 2012, 11:41 am      When I reached the chapter on the environment, it seems the author is attacking a straw man. Eco sentimentalism and the naturalistic fallacy are of course ridiculous. However our planet does have some problems and I am not convinced that the market is the best custodian of our dwindling resources. Take oil:    I used to cherish the fond belief that, as oil stocks ran low and the price of oil rose, the market would cause alternative sources of energy such as nuclear and renewables to take over ( as they became cheaper than oil) What seems to be happening instead is that, as the price of oil rises, it becomes more viable to extract oil from less concentrated sources such as oil shales and sands. Unfortunately these sources are much more polluting ( again, there is no market mechanism to prevent pollution. The consumer gets the benefit of the oil, but the pollution cost is shared by everyone, hence no incentive not to pollute) The rising oil price seems to be incentivizing a ever more frantic scramble for the remaining reserves. This is another illustration of the markets inability to take a long term view. It can only respond to the immediate situation.The central reason why nuclear didn't develop in the last half century or so is solely down to politics. I don't think there's even a nuclear facility built in the US for 35 years because of it, it is such a political hot potato. Anyway, the problem I have with your idea here, is that you believe renewable energy is the solution. Don't get me wrong! I love the idea of having an energy independent system, I mean it fits in perfectly with my libertarian ideas. The problem is that it is expensive, really really expensive. Like if we try really really hard in the US to make renewables work, then it'll still only be 5% of our entire energy requirements in a few decades.I mean never mind oil for a second. A huge number of the power we use is from coal, still! I believe that the market is looking for a solution, and that one of those solutions is probably going to be scale gas. That is a big improvement on both oil and coal. It can be used for transport, it is cheaper than oil/gas to power stations. There is more of it around. It has less carbon footprint widget thing that I don't particularly care about, but still, it's a perk.And you know what? People are turning out in droves to prevent scale gas being extracted because of a stupid pseudoscientific documentary called Gasland, which is a beautiful piece of propaganda, but has absolutely no truth in it. Literally the entire movie is a lie. It is very compelling though, which is easy when you're fast and free with the facts instead of actually explaining the entire story, and let us be frank, just making shit up.I'm not ranting at you here, it is just that once again, we have the market vs political populism. I don't think the market is the primary cause of this short sightedness you believe you're seeing.Secondly, apart from politics causing problems, you have to recognize that coal and oil, dirty they may be, are powerful and cheap sources of energy. Price is important. To put my point in the words of the Big Lebowski "Well, like, that's just your opinion man". Plenty of people agree with you (and I) that going to other energy solutions is important for various reasons. But... That's just our opinion. It doesn't negate that lots more people may not be able to afford our opinions in practice, however wonderful they may be. tldr; what you're calling "The Long View" that you're saying the market doesn't take and should take, could merely be completely wrong. Maybe we'll be using methane hydrates as a form of fuel instead in 50 years, since there's about a trillion times more of that than all the oil, gas, coal and every other form of non-renewable energy put together. There are other options, maybe we don't see them yet.Maybe... just maybe... this is not a giant big emergency that you think it is.Quote from: Hungry ghost on October 05, 2012, 11:41 am     It seems to me that the market will not stop until oil is too expensive to be useful. Of course as the price increases there will be an incentive to develop alternatives, but what damage will be done to the environment in the meantime. I am not being sentimental about nature. If the global temperature rises by a few degrees and the sea level rises, many highly populated areas will become uninhabitable. If agricultural land migrates north and south, ( and chinas good rice growing land ends up in Russia), the market will make adjustments, but the adjustment process will be traumatic.Yeah... I don't believe that's going to happen at all. Do you remember "The Population Bomb" by Ehrlich? Every so often a popular idea takes over everything for a while with claims of catastrophe. In practice such people almost always turn out to be wrong. I have actually talked to a number of climate scientists about this, involved in a famous project that shall go unnamed here. I won't go into it here, but let's just say that "their" ideas are not the "public's ideas" about climate change. I mean these are real live scientists working in this field, and they are pretty far away from "and then the world became uninhabitable and we swam with the polar bear" vision that the media are running with. Climate change, yes, most likely. Catastrophe, not by a long shot, such claims are incredibly, incredibly speculative.I think the reason that I don't take the "we got to save the world" people seriously is because literally 9/10s of the people I've met with that frame of mind are not scientists, and not only are they not scientists, but when I question them, I find out they believe that if the North Pole melted completely that the sea levels would rise. (!)At that point I just stop taking anything else they say seriously. These people are scientifically illiterate about the most elementary aspects of the subject.Quote from: Hungry ghost on October 05, 2012, 11:41 am     Anyway, I don't want you to think I am close minded to these ideas. I think the author takes something of an extremist stance, but he makes many interesting points.Certainly the market is the only game in town. Regardless of what I might think, it is going to remain the dominant force in human society. I have no problem with this, I just think we need some other authority to mitigate problems the market may create. This doesn't necessarily have to be leviathan like government. I noted with interest that the author seems to have a quiet admiration for feudalism. The concept of a society governed by competing authorities is an interesting one.I like the idea of confederations. This is where city states compete (non violently, they are tied by trade to each other) for labor/capital etc and have their own currencies for their economic sphere of influence. Countries are incapable of such a thing, but individual cities can do this. People have different ideas about this, but I believe this is likely to be our future. It makes more sense when you think that the countryside and towns are pretty much going to be completely emptied of people within a few decades, and this looks to be an accelerating trend.Quote from: Hungry ghost on October 05, 2012, 11:41 am    Clearly, any movement to change society for the better is going to need to prove itself through competition. It cannot be imposed from above. For a while now, I have been thinking about the idea of worker owned companies. I would be interested to hear critiques of the following:     The standard model for a business is employees under a hierarchy of managers, who take care of the day to day running of the company. The company is owned by the shareholders, who appoint a board of directors. The two sides of the business are seperate. The responsibility of the directors is to maximize profits for the shareholders. Usually the interest of the shareholders coincide with the employees but not always.     Now consider the case of a company where the employees own all the shares. It will work just the same way, they can employ directors etc. BUT such a company will not need to show a profit. It will only need to break even. As long as it makes enough to cover all costs and pay everyones wages, it can continue to trade. Freed from the pressure to make profit, surely such a company could undercut its competitors, while paying its suppliers and employees better. Would a business arranged along these lines come to dominate its sector?    Since this doesnt seem to be happening, perhaps I have missed something. I would be interested in people's thoughts on this.Actually HG, you'll be happy to know it is happening. I was reading the WSJ a while back, they were talking about exactly that in the UK, where John Lewis (I think it's a kind of chain store?) has each employee with shares of ownership. I don't know the details, but it is definitely going on.Similarly, there is another company near NY state, I forget the name, I think they are a big biotech label, and they are super serious about each employee obtaining ownership.Now, these are both very successful companies in very different areas with consistently high profit margins, so it can and does work. Employees are highly motivated for sure. The only caveat I have about this concept, is that if the company goes bankrupt then the employees lose their ownership of investment capital simultaneously along with their jobs. Kind of sucks.But, I can think of a few ways around that using special capital allocation instruments, won't discuss them here, but it's not insurmountable that's for sure, it's not even difficult if it's arranged correctly.By the way, there is no dichotomy between "profits" and "wages" in the situation you describe. They are actually the same thing. Higher profits means higher income from dividends on the shares, which is the exact same thing as giving the workers higher wages.