This man's a liar. Because if you read "Socialism Utopian and Scientific" You will find that Engles lauds the early Utopian socialists. In fact it's always the pro capitalists who call us utopians. That we created a worker's utopia in the USSR. When a lecture starts with a lie why should anyone continue listening to the lecturer? www.marxists.org/archive/marx/works/1880/soc-utop/ch01.htm
@@kimobrien. If only Engels wealthy family and their wealthy industrial and banker associates in including the ones we today know as Rothchilds, had not paid Marx to write Des Kapital in London, where he was giving all the pampers of capitalism to do so....
@@kimobrien. The Soviet Union was a "workers utopia?" Whaaaaaaa? Listen, I know people who grew up in Soviet Russia and Romania. They didn't describe any utopia I can tell you. I also have read a few books about it. You should try reading things written by people other than Marx and Engles. Try Solzhenitsyn.
@@roharatube I never said we created a workers utopia you seem to keep playing with yourself on that issue like other morons do. Go back and re read what I said. I meet comrades who meet Leon Trotsky personally. He spent 21 year in exile before being assassinated and was the Organizer of the 1921 Red Army victory and knew all the original leaders of the 1917 revolution including Stalin and Lenin.
I really wasn’t expecting much from the title... but this was a very interesting learning experience. I wish whoever was running the show had said “don’t worry, you’re fine on time. Take as long as you want “. It seemed he had more to say. 🇺🇸❤️🇺🇸❤️🇺🇸❤️🇺🇸❤️
Most OEM bumpers are made out of plastic and feature an aluminum or steel reinforcement bar hidden in the middle. Some bumpers may also contain polypropylene in order to help absorb energy during an impact. Bumpers are not made from fiberglass.
This and there’s safety regulations that make it taxable to sell a commercial automobile on cars that lack a certain crumple zone area. A more apt analogy would be a steel bumper vs a carbon fiber or titanium or other exotic material
So given that property rights are government enforced (unless you're living under anarcho-capitalism) market price setting is the government outsourcing a function it has concluded it cannot itself effectively perform. Capitalists are price-setting contractors.
Question for Joseph T. Salerno: Do you teach History of Economic Thought? In your lectures, do you discuss the work of Karl Marx, Henry George, Mason Gaffney and other prominent authors of "progressive" economic ideologies?
Didn't Charles Fourier write a book entitled "the hierarchies of cuckoldry and bankruptcy"? For that I advise people to look up the section of Thomas Acquinas book City of God on libido dominandi.
Can someone explain how I can use this brilliant evisceration of socialism to argue against ‘social democracy’ and the welfare state where the means of production are not owned by the state and private property exists?
I’ve heard that a lot as well and the simple answer is this. In both cases, with or without private property, the fatal flaw is the lack of incentives to produce more. That absence or reduction in incentives (higher and higher taxes) combined with the incentive to not work at all (welfare state) is what leads to a decline in production and a smaller and smaller economy. Remember, there is no such thing as free healthcare. Doctors require payment, hospitals cost money, free to most people doesn’t mean government funded through taxation even though it is. Just my two cents lol
Ask them if they'd be ok with the government confiscating all their stuff to benefit society. When they say no, ask them how much of their stuff they'd be ok with the government taking from them. If they say they don't want the government to take anything, they don't understand what they're arguing, but then you can talk to them about how taxes is the government taking their stuff. Make sure you talk about payroll taxes because even poor people pay those and they are the hardest hit by them. Everyone loses 15% of their wages to payroll taxes. Think about what you could do with 15% more in your pocket each paycheck. If they throw out a number, ask them how they decide that number? Ask them if that number should be the same for everyone. If they say rich people should have more taken, ask them what the government will be able to do to them if it's able to take advantage of rich people. That's a large amount of power that can lead to anyone being completely destroyed, including them, if the majority of people decide that that's how things are going to be now
At the slide at 45:00, I think the 3rd bullet wasn't Mises' argument. He would readily grant that all these practical issues would be non-existent because the socialist planner would be omniscient. But knowing the equilibrium point isn't a plan of how to get from here to there: what steps do you first take to reach the computed equilibrium? Each step is also a change that itself can modify the equilibrium point... Here is the relevant chapter from human action: mises.org/library/human-action-0/html/pp/862
Mises does discuss this point, exactly as the 3rd bullet states. Cf: mises.org/library/equations-mathematical-economics-and-problem-economic-calculation-socialist-state-0 Of course, later, in Human Action, he clarified the central point that equilibrium can only be a mental construct and doesn't reflect the dynamic nature of the market and, even at that point of perfect knowledge, calculation is still impossible. But yes, you are essentially correct, although Mises did write on this.
@@matheus.fialho I wasn't aware of that article but here's the crucial point: "But we know nothing of what the demand would be if another price prevailed. " -- this is what I'm summing up in my comment: changing the price structure towards the way of the computed equilibrium, is itself a change modifying the computed equilibrium. The 3rd bullet on the slide is a weaker argument, making reference to "change" in the abstract. One could answer that, "what if the adaptation was fast before any important change could occur?" But Mises argument is stronger: the adaptation itself also causes changes.
@@DimitrisAndreou Oh, I see... Now I realize that, at first, I hadn't undestood your comment. Rereading it now makes more sense and, indeed, Mises' point on this is even more fundamental than what it was shown in the slide, as you said. Thanks for clarifying this!
With reference to the house made in Montana and shipped over, is he saying in parallel that globalism is good capitalism? Like fuits from south america shipped to china to be packaged and then exported to the USA?
You think your example is ridiculous, but what the market is optimizing for, even in your example, is lower cost of producing the goods in order to maximize the profits. In the case of your example, the reason for this is because the global fruit market wants fruits year round and not all regions produce fruits year round, so the process is optimized to take advantage of fruits being grown in other regions. As for why they are packaged in some far off Asian country, that’s easy. Two things come into play, one labor costs are lower and infrastructure for packaging already exist, and the fruit tend ripen on the way to the packaging facility. It’s also much more cost-effective and efficient to ship things through water than it is to do so by truck, plane, or even train. A shipping container costs the same no matter what’s inside, so it’s always less expensive to ship long distances by ship than it is by any other means. That also means that it shipping tends to favor places that can work close to the ports or have a short distance from the ports, to be able to take advantage of the costs savings of shipping over other means of transport. It’s all these factors and more that make for to what some see as ridiculous, but what really is efficient.
1. There are some arbitrary government restrictions that make shipping shipping direct to large markets like the US for packaging more expensive 2. Sometimes all other things equal, it is just cheaper for countries like China to specialize in fruit packing. A big reason that happens is because fruit consumption in the states is kinda irregular. Of course I don’t have to go into the fact that some areas just grow certain thing better. And that again, shipping is just stupidly cheap.
I wish Salerno went to the heart of the problem: why can't a single mind (or gigantic computer) come up with a price structure. He mentioned it's too complicated but this is not Mises argument, this is Hayek's argument.
But he did. 1. Socialism abolishes private property in capital goods and natural resources. 2. Since the socialist State is sole owner of the material factors of production, they can no longer be exchanged. 3. Without exchange there can be no market prices. The problem is not in calculation power, it's a problem of existence. There are no prices. No production cost calculations. No profit and loss functions. What you're inputting in your supercomputer is literal garbage. Optimization only works when you have a definite system of equations to solve.
@@markuscroubere1140 And yet, we would not say Caruso on his island is not engaging in economic calculation when deciding between producing fish now or a net to produce fish later. The fundamental problem with a lack of prices is it requires inter-personal value judgements. Caruso by himself knows how strongly he wants fish vs bread vs shelter. Without offers of exchange, he cannot know how strongly Friday wants those things.
@@markuscroubere1140 Seems to me we can keep track of the labor time put into products and use that in place of a capitalist price structure. The idea that the huge value given to the owners of capital gives them an incentive to do anything but increase the value of their property is utopian in thinking. Why invest in anything that might not result in a bigger return on investment when you can invest in the sure things made of fictitious capital?
Assuming the attendees to Professor Salerno’s presentations are well-marinated in neoclassical causality, can we agree . . . 1) that general economic optimality is the object of economic calculation . . . 2) that ‘the real, live, objective macro economy that is out there’ is observed to accomplish dynamically stable and efficient adjustments to the ever-changing shapes of its production and utility tradeoffs (at least insofar as its markets remain unencumbered) . . . 3) and that this dynamic stability owes to the economy’s spontaneous tendency to continuously establish the conditions of whatever unique optimum implicit in its current production and utility tradeoffs? Having agreed to these three notions, would it not follow that incisive economic calculation is always being accomplished - somehow, somewhere, on this planet earth? If it were not, how might we account for the stability and efficiency we observe? Is consigning what we see to a mere mystery really worthy of the Western scientific tradition? The Austrians’ allegations that artificial economic calculation is not possible are, then, merely assertions without evidence that formal analogs to what the economy is observed to do are impossible to develop. Because ‘that which is impossible’ cannot, by definition, be instantiated, their claim will remain forever unproved. Such a claim can, however, be disproved by counterexample. If your installation of MS Office is current and complete enough to run VBasic, then you can operate an instructional videogame that will generate a limitless sequence of emulations exhibiting efficient economic calculation. See: www.sfecon.com/TH-cam Demo.xlsm (The VBasic programs embedded in this ordinary Excel workbook will needlessly alert your anti-virus software. No one wants to damage your computer.) Enjoy; and please report back with your findings.
The problem is not the centralization of control it’s the exchange mechanism. If there is no exchange there can be no meaningful prices and without meaningful prices, there is no sensible calculation that can be done.
So… money? And decentralized planning still doesn’t economize goods. Why does commune X deserve flour more than commune Y? How much flour should commune Z make? And why should any of these communes trade? Barter economies are primitive and can’t engage in advanced production. Frankly, farmer bill doesn’t give a damn about American girl dolls and city worker Jeff doesn’t give a damn about tractors or fertilizer. These two could trade. But likely only once and under some very extraordinary conditions. With money, they can trade at any time. If socialists could just understand money, they’d give up the idea of socialism because money is a truly decentralized method of determining demand and weighing costs.
What makes a person is the society he lives in. Supply, Demand and competition can exist in a socialist society. Once a community realize that each and one of them depends on one another, they will tend to do their job and serve his/her worth. After all it's for them why they are working. Also, Give rewards to the innovators. A person who no longer tries to just survive will not try to eat other fellow humans but thinks of how he can contribute and grow. If he/she isn't able to work, give him/her a deadline, find the reasons why he/she can't work. If you are that afraid of entire socialist system, why not even have a basic social safety net? Then make the next move from that point.
So if capitalism is so efficient why do Federal Reserve stats show a decline in the use of capacity use (usage of productive facilites) from 90% in 1967 to 65% today? If capitalism works for everyone why did the US want to create hunger and desperation in Cuba? Afterall shouldn't Cuba have gone back to capitalist methods like China and the USSR?
But the fundamental problem is not calculation but human attitude and interpretation of things. It is so easy to trick the human mind that most often than not a good manipulator can separate people from their money.
This is a fabulous explanation of why colectivist economic systems do not work and nearly always end in disaster.
@Doug Kirk If they don't realize what a big mistake it was and go back to a free market like Scandinavian countries did then yes, always.
This man's a liar. Because if you read "Socialism Utopian and Scientific" You will find that Engles lauds the early Utopian socialists. In fact it's always the pro capitalists who call us utopians. That we created a worker's utopia in the USSR. When a lecture starts with a lie why should anyone continue listening to the lecturer?
www.marxists.org/archive/marx/works/1880/soc-utop/ch01.htm
@@kimobrien. If only Engels wealthy family and their wealthy industrial and banker associates in including the ones we today know as Rothchilds, had not paid Marx to write Des Kapital in London, where he was giving all the pampers of capitalism to do so....
@@kimobrien. The Soviet Union was a "workers utopia?" Whaaaaaaa?
Listen, I know people who grew up in Soviet Russia and Romania. They didn't describe any utopia I can tell you. I also have read a few books about it. You should try reading things written by people other than Marx and Engles. Try Solzhenitsyn.
@@roharatube I never said we created a workers utopia you seem to keep playing with yourself on that issue like other morons do. Go back and re read what I said. I meet comrades who meet Leon Trotsky personally. He spent 21 year in exile before being assassinated and was the Organizer of the 1921 Red Army victory and knew all the original leaders of the 1917 revolution including Stalin and Lenin.
So well explained, I’ve learned a lot. Thank you Professor Salerno.
I really wasn’t expecting much from the title... but this was a very interesting learning experience. I wish whoever was running the show had said “don’t worry, you’re fine on time. Take as long as you want “. It seemed he had more to say.
🇺🇸❤️🇺🇸❤️🇺🇸❤️🇺🇸❤️
Great lecture. Thank you for sharing.
This is one of the most concise sets of direct examples of the efficiency loss in central planning compared to markets
Most OEM bumpers are made out of plastic and feature an aluminum or steel reinforcement bar hidden in the middle. Some bumpers may also contain polypropylene in order to help absorb energy during an impact. Bumpers are not made from fiberglass.
Thank you, David. I cringed listening to that part of the lecture
His overall point was valid even though he clearly knows nothing about cars lol Was definitely cringing on that one
This and there’s safety regulations that make it taxable to sell a commercial automobile on cars that lack a certain crumple zone area.
A more apt analogy would be a steel bumper vs a carbon fiber or titanium or other exotic material
Free enterprise.
So given that property rights are government enforced (unless you're living under anarcho-capitalism) market price setting is the government outsourcing a function it has concluded it cannot itself effectively perform. Capitalists are price-setting contractors.
Question for Joseph T. Salerno: Do you teach History of Economic Thought? In your lectures, do you discuss the work of Karl Marx, Henry George, Mason Gaffney and other prominent authors of "progressive" economic ideologies?
Didn't Charles Fourier write a book entitled "the hierarchies of cuckoldry and bankruptcy"? For that I advise people to look up the section of Thomas Acquinas book City of God on libido dominandi.
Can someone explain how I can use this brilliant evisceration of socialism to argue against ‘social democracy’ and the welfare state where the means of production are not owned by the state and private property exists?
I’ve heard that a lot as well and the simple answer is this. In both cases, with or without private property, the fatal flaw is the lack of incentives to produce more. That absence or reduction in incentives (higher and higher taxes) combined with the incentive to not work at all (welfare state) is what leads to a decline in production and a smaller and smaller economy. Remember, there is no such thing as free healthcare. Doctors require payment, hospitals cost money, free to most people doesn’t mean government funded through taxation even though it is. Just my two cents lol
Ask them if they'd be ok with the government confiscating all their stuff to benefit society. When they say no, ask them how much of their stuff they'd be ok with the government taking from them.
If they say they don't want the government to take anything, they don't understand what they're arguing, but then you can talk to them about how taxes is the government taking their stuff. Make sure you talk about payroll taxes because even poor people pay those and they are the hardest hit by them. Everyone loses 15% of their wages to payroll taxes. Think about what you could do with 15% more in your pocket each paycheck.
If they throw out a number, ask them how they decide that number? Ask them if that number should be the same for everyone. If they say rich people should have more taken, ask them what the government will be able to do to them if it's able to take advantage of rich people. That's a large amount of power that can lead to anyone being completely destroyed, including them, if the majority of people decide that that's how things are going to be now
Both the Utopians, and "Scientific" (emphasis on the quotation marks) are out of their minds.
At the slide at 45:00, I think the 3rd bullet wasn't Mises' argument. He would readily grant that all these practical issues would be non-existent because the socialist planner would be omniscient. But knowing the equilibrium point isn't a plan of how to get from here to there: what steps do you first take to reach the computed equilibrium? Each step is also a change that itself can modify the equilibrium point...
Here is the relevant chapter from human action:
mises.org/library/human-action-0/html/pp/862
Mises does discuss this point, exactly as the 3rd bullet states. Cf:
mises.org/library/equations-mathematical-economics-and-problem-economic-calculation-socialist-state-0
Of course, later, in Human Action, he clarified the central point that equilibrium can only be a mental construct and doesn't reflect the dynamic nature of the market and, even at that point of perfect knowledge, calculation is still impossible. But yes, you are essentially correct, although Mises did write on this.
@@matheus.fialho I wasn't aware of that article but here's the crucial point: "But we know nothing of what the demand would be if another price prevailed. " -- this is what I'm summing up in my comment: changing the price structure towards the way of the computed equilibrium, is itself a change modifying the computed equilibrium.
The 3rd bullet on the slide is a weaker argument, making reference to "change" in the abstract. One could answer that, "what if the adaptation was fast before any important change could occur?" But Mises argument is stronger: the adaptation itself also causes changes.
@@DimitrisAndreou Oh, I see... Now I realize that, at first, I hadn't undestood your comment. Rereading it now makes more sense and, indeed, Mises' point on this is even more fundamental than what it was shown in the slide, as you said. Thanks for clarifying this!
#trump2020 lets get this great country back on track. Great video.
You realise you’re on a mises video? Trump and minarchists/anarchists radically disagree
With reference to the house made in Montana and shipped over, is he saying in parallel that globalism is good capitalism?
Like fuits from south america shipped to china to be packaged and then exported to the USA?
Yes, global free market capitalism is good.
You think your example is ridiculous, but what the market is optimizing for, even in your example, is lower cost of producing the goods in order to maximize the profits. In the case of your example, the reason for this is because the global fruit market wants fruits year round and not all regions produce fruits year round, so the process is optimized to take advantage of fruits being grown in other regions. As for why they are packaged in some far off Asian country, that’s easy. Two things come into play, one labor costs are lower and infrastructure for packaging already exist, and the fruit tend ripen on the way to the packaging facility. It’s also much more cost-effective and efficient to ship things through water than it is to do so by truck, plane, or even train. A shipping container costs the same no matter what’s inside, so it’s always less expensive to ship long distances by ship than it is by any other means. That also means that it shipping tends to favor places that can work close to the ports or have a short distance from the ports, to be able to take advantage of the costs savings of shipping over other means of transport. It’s all these factors and more that make for to what some see as ridiculous, but what really is efficient.
1. There are some arbitrary government restrictions that make shipping shipping direct to large markets like the US for packaging more expensive
2. Sometimes all other things equal, it is just cheaper for countries like China to specialize in fruit packing. A big reason that happens is because fruit consumption in the states is kinda irregular. Of course I don’t have to go into the fact that some areas just grow certain thing better. And that again, shipping is just stupidly cheap.
I wish Salerno went to the heart of the problem: why can't a single mind (or gigantic computer) come up with a price structure. He mentioned it's too complicated but this is not Mises argument, this is Hayek's argument.
But he did. 1. Socialism abolishes private property in capital goods and natural resources. 2. Since the socialist State is sole owner of the material factors of production, they can no longer be exchanged. 3. Without exchange there can be no market prices.
The problem is not in calculation power, it's a problem of existence. There are no prices. No production cost calculations. No profit and loss functions. What you're inputting in your supercomputer is literal garbage. Optimization only works when you have a definite system of equations to solve.
@@markuscroubere1140 And yet, we would not say Caruso on his island is not engaging in economic calculation when deciding between producing fish now or a net to produce fish later. The fundamental problem with a lack of prices is it requires inter-personal value judgements. Caruso by himself knows how strongly he wants fish vs bread vs shelter. Without offers of exchange, he cannot know how strongly Friday wants those things.
@@markuscroubere1140 Seems to me we can keep track of the labor time put into products and use that in place of a capitalist price structure. The idea that the huge value given to the owners of capital gives them an incentive to do anything but increase the value of their property is utopian in thinking. Why invest in anything that might not result in a bigger return on investment when you can invest in the sure things made of fictitious capital?
@Ubiquitary This is what I get for listening to it as an audio book. I will try to remember the difference!
@@kimobrien. And yet a ditch dug with a spoon is not of more value than a ditch dug with a shovel.
Read Paul Cockshott, he explained it
Assuming the attendees to Professor Salerno’s presentations are well-marinated in neoclassical causality, can we agree . . .
1) that general economic optimality is the object of economic calculation . . .
2) that ‘the real, live, objective macro economy that is out there’ is observed to accomplish dynamically stable and efficient adjustments to the ever-changing shapes of its production and utility tradeoffs (at least insofar as its markets remain unencumbered) . . .
3) and that this dynamic stability owes to the economy’s spontaneous tendency to continuously establish the conditions of whatever unique optimum implicit in its current production and utility tradeoffs?
Having agreed to these three notions, would it not follow that incisive economic calculation is always being accomplished - somehow, somewhere, on this planet earth? If it were not, how might we account for the stability and efficiency we observe? Is consigning what we see to a mere mystery really worthy of the Western scientific tradition?
The Austrians’ allegations that artificial economic calculation is not possible are, then, merely assertions without evidence that formal analogs to what the economy is observed to do are impossible to develop. Because ‘that which is impossible’ cannot, by definition, be instantiated, their claim will remain forever unproved.
Such a claim can, however, be disproved by counterexample. If your installation of MS Office is current and complete enough to run VBasic, then you can operate an instructional videogame that will generate a limitless sequence of emulations exhibiting efficient economic calculation. See:
www.sfecon.com/TH-cam Demo.xlsm
(The VBasic programs embedded in this ordinary Excel workbook will needlessly alert your anti-virus software. No one wants to damage your computer.)
Enjoy; and please report back with your findings.
Couldn’t the ECP be debunked with de-centralized planning than
The problem is not the centralization of control it’s the exchange mechanism. If there is no exchange there can be no meaningful prices and without meaningful prices, there is no sensible calculation that can be done.
So… money? And decentralized planning still doesn’t economize goods. Why does commune X deserve flour more than commune Y? How much flour should commune Z make? And why should any of these communes trade? Barter economies are primitive and can’t engage in advanced production. Frankly, farmer bill doesn’t give a damn about American girl dolls and city worker Jeff doesn’t give a damn about tractors or fertilizer. These two could trade. But likely only once and under some very extraordinary conditions. With money, they can trade at any time. If socialists could just understand money, they’d give up the idea of socialism because money is a truly decentralized method of determining demand and weighing costs.
What makes a person is the society he lives in. Supply, Demand and competition can exist in a socialist society. Once a community realize that each and one of them depends on one another, they will tend to do their job and serve his/her worth. After all it's for them why they are working. Also, Give rewards to the innovators.
A person who no longer tries to just survive will not try to eat other fellow humans but thinks of how he can contribute and grow. If he/she isn't able to work, give him/her a deadline, find the reasons why he/she can't work.
If you are that afraid of entire socialist system, why not even have a basic social safety net? Then make the next move from that point.
I haven't laughed this much at socialists' expense since I first saw Benny Hill's socialist skit!
Heaven on earth would last for 12.......... 12,000 years. Everyone knows that.
some believe it will last 1,000 years, some believe that heaven is heaven and is not to be found on earth.
You can have a socialist economy, it just won't be very efficient. What you can't have is a socialist catallaxy.
So if capitalism is so efficient why do Federal Reserve stats show a decline in the use of capacity use (usage of productive facilites) from 90% in 1967 to 65% today? If capitalism works for everyone why did the US want to create hunger and desperation in Cuba? Afterall shouldn't Cuba have gone back to capitalist methods like China and the USSR?
But the fundamental problem is not calculation but human attitude and interpretation of things. It is so easy to trick the human mind that most often than not a good manipulator can separate people from their money.
In socialism, this is a major problem.
He's not wrong. However, could he have someone else do the talking next time. So annoying.
stalin RIPBOZO
He's hard to listen to for some reason. Something about his smarmy collectivist bolshivekspeak.
It's caused by your ears.