Individualism Is Stupid ( Or Why Libertarianism And Objectivism Is Stupid)

[The Grand Nudger]

I must admit that my knowledge of economics is rather primitive. I should probably read Wealth of Nations or some other works so that I am more prepared for discussions like this. What I was referring to in terms of self-correction was those graphs which showed supply/demand ratios (a foggy memory from economics 101). To me this demonstrates that capitalism assigns value to those things which consumers desire (like the "luxuries" I mentioned above) but only when those things are in short supply (ie more of those things need to be produced). Anyway, I don't want to belabor the point as I certainly agree that the supply/demand model is problematic.

Now that I know you live in redneckistan (like me) I've got some good ones for you.  Consider The Dollar General, and agricultural subsidies. 

We'll start with the latter.  If economics 101 examples in a vacuum worked in practice, it would be hard to understand the history of subsidy.  If there is ever a consuming demand for -any- product..it would be food.  This is a demand driven by absolute necessity.  People never decide that they just don't want food, they can't.  So that eliminates a variable, getting us closer to the vacuum.  So let's imagine a small town of 100 people, back in the day.  100 people need alot of corn.  The "invisible hand", recognizing this, sets a high value for a product in demand.  This leads to many producers competing.  Inherent overproduction.  The value drops.  The next year, the farmers who got hosed don't plant as much corn, or no corn at all.  The value goes up because there isn't enough to go around.  Now, we may see this as some sort of eventual levling out, and better producers or marketers winning out over poor ones...bu that's -not- how it actually played out.  One seasons winners were the next seasons losers, and the product was over or under-produced chronically.  When it was overproduced, this led to poverty, when it was underproduced, malnourishment and starvation.  Some people got out of the market entirely in favor of higher value crops...the cycle repeated itself there.  The constant see-saw led to the planned destruction of crops, and payments meant to induce producers to limit their production.

The invisible hand failed, and in a breathtaking show of just how much we -don't- believe in it and how ineffective it really is even as a concept...we created permanent agricultural subsidies.

Yeah, this one hit close to home... literally. I live in Appalachia, and this very thing happened in my hometown. The county gov't attracted a number of corporations (Bausch and Lomb being the most notable) to set up factories in my hometown. Eventually, the public coffers were drained and the county could no longer afford to offer the incentives. The minute this happened, Bausch and Lomb and others packed up and left, flooding the area with unemployed workers. So I know first hand the perils of supply-side economics.

...and now the Dollar General. Hehehe.  The dollar general is beating out walmart in rural areas.  Their business model famously relies on the permanent creation of an impoverished american underclass.  Any place a dollar general goes up..the owners are expecting the residents to stay poor for the forseable future.  If they don't, they'll get crushed by walmart....which, I have to say is an incredibly sobering realization.   Walmart occupies a socioeconomic niche slightly above the bottom.  Walmart......

Now, the way a dollar store gets its shit (if you never worked for one) is buying bulk containers sight unseen....and then distributing whatever goods they happen to contain.  Some also offer targeted purchases...the bulk containers are what we would call loss leaders in any other model - get's people in the door-...except nobody loses a single red cent on any product sold at a dollar store.  The helves are stocked with bric a brac.  None of it necessarily valuable to the customer, but all of it available.  If we wanted to explain dollar stores, in the general sense ( ) the product they are selling is not the product on the shelves...but the experience of a purchase made available to people who could not afford to avail themselves of the same....at a walmart.  While the model keeps unsold product to a minimum..there -is- unsold product..and it get's shipped and ferried around to other stores (sometimes being marked down but just as often getting marked up or combined into value added products).  All of this inefficiency, from the production of metric tons of useless plastic bric a brac, to the movement of the same to and from each location serves the ends of the movement of capital.....but I don;t think that anyone is really ready to assert that the shoppers are getting good deals on products that they value (or even..that -are- legitimately valuable).  The old model, though..was incomplete, and it wasn't until they started offering overpriced food -that qualified for ebt- that dollar stores began to gain against walmart..who'd went the route of welfare queen beforehand proving the model.  

Yet again, no one believes that the production or value of dollar store bric a brac is related to dollar store bric a brac being in short supply or valuable in a non-trivial sense, nor is the model predicate on supply and demand...but upon exploiting reliable sources of income in the form of welfare services (and, like walmart, dollar stores rely on welfare programs to cover the col of their employees and hope that the employee also shop there with their ebt, lol).

I know this was all alot, but it was an explanation of an opinion of mine that..while we fellate the idea of free markets and supply and demand in class....we turn around and do the exact opposite in practice, in business. It's almost as if the vacuum 101 examples are entirely divorced from reality. Elaborate mythmaking. So elaborate and so entrenched that had I ot given those examples the opinion would likely be rejected on principle..and that even though I have given those examples someone is going to find some way to reinterpret the history of subsidy and the present reality of low end retail. It's just so damned bleak, that cant be s and d or free markets or capitalism working as intended...right?