Linked by Thom Holwerda on Sun 20th Mar 2011 20:20 UTC
PDAs, Cellphones, Wireless A major deal just went down in the United States, which seriously shakes up the mobile industry on the other side of the pond: AT&T has announced it plans to buy T-Mobile USA from Deutsche Telekom.
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RE[4]: Invisible hand
by spiderman on Mon 21st Mar 2011 19:19 UTC in reply to "RE[3]: Invisible hand"
Member since:

I don't think there is any conflict of interest in principle. They recognize that competition is stimulating. The advantage of having the government own the carriers is that the profits don't go through the hand of local and foreign parasites (share holders). The profits can be used to serve the population instead.
Actually, I see a conflict of interest in corporations run by private share holders. Their interest is in direct conflict with the company (both the consumers and the workers). Their only interest is to make money, with the company or elsewhere.

Reply Parent Score: 2

RE[5]: Invisible hand
by ricegf on Mon 21st Mar 2011 23:00 in reply to "RE[4]: Invisible hand"
ricegf Member since:

Well, I own quite a bit of stock myself (mostly in mutual funds), so I probably should take offense at your characterizing me as a "parasite". :-D

Stockholders provide capital for business expansion, and expect to earn profit commensurate with the risk that the expansion will fail. The average annual rate of return over the past 100 years (based on the S&P 500) after inflation is 6% to 7%. Not exactly usurious or abusive, IMHO - and a majority of Americans own at least some stock (bunch of parasites that we are).

One alternative is for a company to grow on a cash-only basis with a single owner. This is a great plan, IMHO, but it has disadvantages. If I owned Microsoft lock, stock, and barrel, for example, to which individual would I sell it when I wanted to do something else? And if I wanted to motivate my employees to perform at their best, what better motivation than if they own part of the company (sometimes called stock options or company stock programs). They may or may not receive an annual bonus, but they own their stock options - if the company earns a profit, their "bonus" is a sure thing!

So I suppose I disagree that I and my fellow shareholders are sponging off of the masses. We're actually financing their jobs. ;-)

Your suggested alternative is for the government to own all of the companies, bear the risks, and reap the rewards. This has some definite disadvantages, though. With a single owner, how much competition can you expect between different companies? Who will regulate their behavior (assuming we permit competition) or motivate them to take risks (if we don't)? Why would someone with a brilliant new idea invest his time and effort to build a market so that the government can profit from it?

Socialism sounds as attractive in theory as communism does, but in practice it tends to work less well - compare Taiwan and Hong Kong (capitalists) to China (formerly socialist), for example. When China decided to push for economic growth, they turned to a regulated form of capitalism, though keeping a communistic form of government. Looks like it's working pretty well to me. (You might read for a reasonably objective take on this.)

All this is just my considered opinion, of course. I far prefer a carefully regulated capitalism to the alternatives, as it seems to breed a *lot* of wealth rather quickly. What I really dislike, though, is a heavily laissez-faire system that allows anonymous mega-corps like AT&T to abuse customers - and particularly when I'm unfortunate enough to be one of their customers!

Capitalism works great when underpinned by morality and generosity - and when not, IMHO, the non-invisible hand of government has a duty to slap it straight again. :-D

Reply Parent Score: 2

RE[6]: Invisible hand
by spiderman on Tue 22nd Mar 2011 06:56 in reply to "RE[5]: Invisible hand"
spiderman Member since:

Well, I own quite a bit of stock myself (mostly in mutual funds), so I probably should take offense at your characterizing me as a "parasite". :-D
Don't fool yourself. You don't own anything. You are gambling a few thousands of dollars at the stock market, that is all. The few thousands of dollars you are gambling are not enough to own anything. The guyz who are in control have billions and they get to decide what the company does. You don't decide anything. You just hope the guy who decides has the same interests as you. That is gambling. More often than not the guys who decide will use your money to screw you along with the rest of the population.
Those guyz don't work. They don't need to. They are not even aware that people work. They don't even screw you directly. They pay people to screw you. They don't even know how the people they pay do screw you.

Edited 2011-03-22 06:58 UTC

Reply Parent Score: 2

RE[6]: Invisible hand
by Neolander on Tue 22nd Mar 2011 07:25 in reply to "RE[5]: Invisible hand"
Neolander Member since:

Well, I also like the "cooperative" (is it also called this way in English ?) way of managing a company, where people from the company, and only them, are all shareholders, which you didn't mention. It guarantees better adequation between the needs of the company and those of shareholders, and solves the issue of shareholder's governance by enforcing that they are competent in the relevant fields and maximally close to the work being done there. What do you think about it ?

Edited 2011-03-22 07:29 UTC

Reply Parent Score: 1