Parallel universes

Of the 20 years or so that I’ve been observing climate change policy, global developments over the past year have been the most hopeful I can remember, particularly as regards electricity generation

* The Paris Conference was a big success, at least relative to expectations
* Coal-fired power stations are shutting down around the world
* China has reduced its coal use for two years in a row
* India has increased its coal tax, and greatly expanded use of renewables

Whether emissions reductions will be big enough and fast enough remains to be seen, but at least we are going in the right direction.

As far as climate science is concerned, the string of temperature records broken recently has killed any idea that we are in a ‘pause’ or ‘hiatus’. Even the favorite source of deniers, the satellite data from UAH, is now showing a new record. The only remaining issue is the second-order debate over whether there was a pause or perhaps slowdown at some point in the first decade of the 2000s.

At the same time, following the US election, I’ve been paying more attention than usual to rightwing blogs, most of which run climate denialist pieces fairly regularly. Given that nearly all the major US coal companies are now bankrupt, and that coal-fired electricity is declining rapidly, I’d have expected a lot of “wrecking ball” pieces on the supposed damage to the economy (in reality, the effects are small and mostly offset by the expansion of renewables) now that mitigation policies of various kinds are taking effect.

But I don’t see anything like that. Rather, most of the articles I’m reading are claims of victory in the debate over both science and policy. Here’s a fairly typical example, with the title “Is the Climate Crusade Stalling?

We really do live in parallel universes.

186 thoughts on “Parallel universes

  1. “You can only get a capitalist profit if you have some means of maintaining some degree of monopoly over apple production or exclusive right defended by the State.”

    That is nonsense, Ivor. Farmers regularly strive to be a new player in a growing demand market, and those farmers who buy machinery to shake nuts out of trees, or crush olives for their oil or manufacture food pellets for their yabbies, shrimp and salmon, or machinery to distil their whiskey, etc, and who employ local labour to operate their plant, will all consider themselves capitalists. You do not have to have a monopoly or government protection to make a profit.

    Again the Marxian view is fixated on the notion that capitalism requires destructive exploitation.

  2. You do not have to have a monopoly or government protection to make a profit.

    You do, actually: in a truly competitive market, prices will be driven to the marginal cost of production.

    Which, you know, won’t cover most player’s costs. You need some form of niche protection, some anti-competitive barrier, to make a profit.

  3. Collin Street, that is just total nonsense. I manufacture a product into a market where I have 30 international competitors. I assure you I qualify as a capitalist, and I DO make a profit. There are many ways to maintain profit in a competitive field.

    But the one thing you need to understand, every business needs to make a profit in order to be able to operate. In a market where there are just 2 competitors and a fixed demand the price for the product will settle at a price that sustains both businesses, and the real competition becomes a tussle for the bigger share of the customer base. You are wrong in saying that prices will be driven to the marginal cost of production, they will be driven to the minimum sustainable PROFIT.

    I found this interesting from Investapaedia

  4. @BilB

    New entrants in a particular occupation can only expect the same income as every other producer – unless they can find some exclusive advantage or political benefit.

    If workers get less they will have incentive to leave their current occupation and move to increase the number of new entrants.

    Capitalism is a system based on stopping workers becoming capitalists. When too many workers become capitalists the capitalist system collapses.

    Marx described this predicament for wannabe capitalists in Colonial South Australia. They had so-called “capital” but no workers.

    The Eureka Rebellion was based on the problems of having too many workers adopying an alternative occupation.

    Marxism is fixated on science and analysis. The exploitation is not inherently destructive. The demand, unique to capitalism, for a constant return on capital is destructive.

  5. @BilB

    Do you employ workers? If you do then you are a capitalist, in essence, albeit probably a small scale, entrepreneurial capitalist unless I misjudge matters.

    If you employ no workers, then you are a self-employed entrepreneur but not a capitalist.

    If you are in partnership with one or more other people and you share all costs, profits, work and management tasks then your group is a workers’ collective.

    Of course, there are blurry edges or grey areas between these seemingly neat little categories. Also, micro-analysis like this does not do justice to the complexities that arise as the system gets bigger (becoming a system of systems) and evolves many types of enterprises plus a complex government sector.

    * * *

    You also say “Again the Marxian view is fixated on the notion that capitalism requires destructive exploitation.”

    Capitalism does not require destructive exploitation of people but it strongly, indeed inevitably, tends in that direction without social democratic intervention. Capitalism is only benign and equitable when it is forced to be so by laws, regulation, taxation and redistribution. Everywhere where law, regulation and re-distribution are lifted or not applied in the first place, capitalism gets very unequal and very exploitative, very quickly. The historical record demonstrates this numerous times. Piketty is the latest to prove the case and he proved it very comprehensively without resort Marxian theory. He used empirical data. Unregulated capitalism trends to ever greater inequality which entails among, other things, ever greater exploitation of labour and ever greater exploitation and destruction of the natural world.

    Regulated capitalism and the mixed economy (when democracy and government are strong) has proven to be more reasonable and equitable. However, the historical conditions for a reasonable accommodation between labour and capital are largely at an end. I wrote about this last point in the sandpit.

  6. Ikonoclast, Yes I employ, both directly and indirectly, and I have a business partner as well. We try hard to keep our direct workforce low by subcontracting as much as possible (my partners’s choice not mine).

    Ivor, I fear you are living in some parallel universe to the one I live in. Going on your definitions Capitalism in Australia has failed and must be close to collapse as almost 3/4’s of Australia’s workforce is employed by SME’s (emerging capitalists).

    (Small and Medium Enterprises) From a page that has gone missing however the facts will be close

    ““SMEs employ almost three quarters of the Australian workforce with the top five employing industries in the sector being construction, professional, scientific and technical services, retail trade, accommodation and food services, and manufacturing,” Dr Hong said.
    “While SMEs don’t have as big a spend on innovation as large businesses, in 08-09 the sector still invested $5 billion in Research and Development (R&D).”

    I take it Ikonoclast that you do not agree with Ivor’s interpretation of Marxian capitalism. It would be helpful if you two guys could agree on one interpretation and report back the proper interpretation so that we are all on the same page. For instance this one has me mystified

    “Capitalism is a system based on stopping workers becoming capitalists. When too many workers become capitalists the capitalist system collapses.”

  7. Ivor, if my apple picking example is not capitalism then you were in error when you wrote:

    “A nation where people can own private property, are able to obtain more private property, are able to work in return for money or property, and have markets where prices of the majority of traded goods roughly approximate what they would be if markets were free, cannot be described as capitalist as this is a basis of market socialism.”

    “Capitalism is this plus extra – workers receiving less value than they produced – the difference flowing through to the owners of MoP as demonstrated by Picketty and others previously.”

    My apple picking example has a private property, the ability to obtain more private property, the ability to work in return for money or property, and markets where prices of the majority of traded goods roughly approximate what they would be if markets were free, and employers receive more than workers contribute. But you say my example is not capitalism, so your definition of capitalism is wrong or incomplete and needs to be improved in order to be useful.

  8. @BilB

    “It would be helpful if you two guys could agree on one interpretation and report back the proper interpretation so that we are all on the same page.”

    I have offered simple definitions from Wikipedia and from Professor R.D. Wolff’s site. The quandaries you and Ronald Brak face in understanding these simple definitions are illustrative of the fact that simple definitions can be of little use for people with no grounding in a subject. I face the same problem when I try to understand Buddhism. Simple definitions of Buddhism just leave me more confused than ever.

    The only solution is extensive reading of primary source texts until you start to “get” the subject. Only you can decide if you want to invest that amount of time.

    It’s quite interesting to me that people are so baffled by the issue and concepts of “capitalism” as an object of study. It’s a testament to how thoroughly critical analysis of our economic system has been expunged from our education system. People are so indoctrinated into capitalism that they cannot step outside it conceptually and look at it analytically. The situation seems similar to earlier Christian eras when religious indoctrination was so thorough people did not have the conceptual tools to think outside their religion.

  9. Ikonoclast, if you “get” capitalism, then what would be the minimum change Australia would need to make in order not to be capitalist?

    Or if you prefer, what would be the minimum change another country such as Sweden would need to make to not be capitalist, as, if I recall correctly, you regard Sweden as being a capitalist nation.

  10. Ronald Brak :
    Ikonoclast, if you “get” capitalism, then what would be the minimum change Australia would need to make in order not to be capitalist?

    This is a real problem. Apart from Frank Stilwell (a Brit) I know of no Australian Left economist who has ever addressed this issue. It is worth looking at what Corbyn advisors James Meadway and George Galloway come up with.

    However, provided there is no degree of monopolisation, and enterprises selling on a market are either family or cooperatives sharing all information, then a free market will not support capitalist profits. They will be competed away. The only profits will be either windfall profits or short-run profits as a market adjusts to a new innovation. These profits are not capitalist profits.

  11. @Ronald Brak

    That’s a good question and a tricky one. I will address Australia as the issue since I know more about Australia than I know about Sweden.

    Firstly, I will need to make a few philosophical points. Problems of definition and categorisation occur in many fields. Let me approach this by first asking some illustrative questions. What are the minimum changes I would need to make to become a very good person? What were the minimum evolutionary changes a pre-human or pre- homo sapiens species needed to undergo to become fully human? Does one need to have a normal complement of human chromosomes (46) to be human? When Pluto ceased to be regarded as a planet by astronomers did it change or did the definition of “planet” change?

    The initial point I am making is that is not easy to make simple definitions and categorisations for complex phenomena with many constituent, interacting parts and ranges, gradations and overlaps of all types of components and processes. Indeed, trying to over-simplify matters will lead you into error. If you want a really simple answer to any genuinely complicated issue you are probably asking for the impossible.

    Now, to answer your question: “What would be the minimum change Australia would need to make in order not to be capitalist?”

    First some general points;

    (1) The change would be a process of many steps if Australia were to transition “organically” and without major disruptions. Capitalism in Australia would likely have to “evolve” over time into Socialism (or some other system) to not be capitalism any more. Or it could collapse quickly into barbaric anarchy. That is the other theoretical possibility if it faced some enormous disruption.

    (2) The precise point where capitalism overall ceased would be hard to discern. The system would grade off from one system type into another system type as it evolved.

    (3) “Evolving” seems a more likely sustainable and permanent path than rapid (and usually violent) radical revolution to a new system.

    Now, some particular points to roughly define the “change” conditions.

    (1) Businesses, enterprises and corporations would predominantly need to be cooperatively owned, managed and worked by the workers in said businesses.

    (2) The taking of income merely by ownership of property would have to predominantly have ceased except where property is held in common by some people as in (1) above or all the people generally as in a nationalised enterprise.

    (3) A state would still be necessary in my opinion. (Some Marxians and S o c i a l i s t s might disagree.) The state would need to be representatively, fully democratic at least, on the proportional representation system. This would be a minimum democratic necessity. The state would still undertake public works (probably considerably more) and levy tax. It would redistribute but to a lesser degree as less inequality should be generated in the first place.

    (4) Markets would still be very necessary in my opinion. Such a system might be called market s o c i a l i s m.

    (5) Private property would still exist as well as communal, public and “state” property. The following forms illustrate this.

    (a) Personal private property which does not generate income.
    (b) Personal private property which generates income from self-employment / entrepreneurship.
    (c) Cooperative property of worker cooperatives.
    (d) Public property as useable public spaces, infrastructures and utilities.
    (d) State and nationalised property (like QANTAS and Commonwealth Bank used to be).

    In practical terms, many law changes would be required to underpin a new ownership system. Workable laws would have to be evolved over time. I will tie myself in knots if I try to make my suggestions on the law front.

    Just as it would have been impossible for a person in the medieval world to envisage capitalism full-blown, it is impossible for a person in the capitalist world to fully envisage S o c i a l i s m. Because of advances in human knowledge and comparative studies, we are now more able to envisage and project socio-economic changes forward from our time than a medieval thinker would have been able to do in his time . Even so, we still cannot fully envisage or project all the details of new and as yet unrealised systems. True S o c i a l i s m, if it can exist as a development beyond capitalism, will have to evolve in many steps by many linked processes. The points I listed above merely illustrate how far I think I can see along a possible path.

  12. Topical.

    Actually my business partner was at Sydney Uni at the time all of this took place, on the student body council with Tony Abbott as well, so I await his detailed elaboration.

    Ivor if this

    “and enterprises selling on a market are either family or cooperatives sharing all information, then a free market will not support capitalist profits”

    is the best you have got as the bright hope for a better world then the capitalist discussion is done.

  13. BilB

    “and enterprises selling on a market are either family or cooperatives sharing all information, then a free market will not support capitalist profits”
    is the best you have got as the bright hope for a better world then the capitalist discussion is done.

    Quite right – Bye, bye capitalism.

  14. @BilB

    And if 40 years of stagnant wages (in real terms), the GFC, the current low growth stagnation and failure to deal with climate change are the best that capitalism can do then we really are done for. I for one do not think current capitalism is the final, best system possible for the rest of history, just as I do not think technological progress is finished already either. The thing that will finish us is blind adherence to a now obviously dysfunctional and obsolete system.

    Systems can work for a while and then become dysfunctional compared to new evolving needs and situations. The fossil fuel system worked well. Now we see that if we take it too far it will destroy us. The same is true of capitalism. It worked well for a while (for some but not all). Now we can see if we persist too long with it then it will destroy our society and our environment. It’s time to further evolve our systems both technical and socioeconomic. To insist on retaining capitalism indefinitely is a Luddite position.

  15. Ikonoclast,
    The whole proposal would be dead in the water right

    “(5) Private property would still exist as well as communal, public and “state” property”

    …there. The reason is that some one else would be deciding how much personal space each person would have access to for living.

    You make better logic with your appeal at 64 . My suggestion, forget Marxism, it is dead and buried, start imagining what the hybrid future capitalist economy looks like.

    When I moved to New Zealand in 1980 Robert Muldoon’s pre globalisation fortress economy was a very interesting place with some appealing properties. He applied a price and wage freeze in order to keep the economy working to his plan, so a study of how that all unravelled might provide an interesting view on future economies in a crisis (climate change) stricken world.

    One area that occupies my thoughts as a designer is how much property per capita can we morally acquire in the nest 40 years . How will our exhausted resources impact on on future communities, and what should I be designing with future resource competition in mind. I have a building design well advanced, a building designed to withstand all that climate change will throw at it and can be expected to endure for 150 years, and hope to get to building a prototype within 5 years.

    Predicting what people will be happy to live with is a big challenge.

  16. I should have added “start imagining what the hybrid future capitalist economy looks like”, as indeed Professor Quiggin does on a regular basis.

  17. Thanks for your reply Ikonoclast, and I probably should have explained my intent behind asking the question and saved you some in time in answering. I apologize for not being clearer, but I did think there were people and organizations that had given considerable thought to how to get rid of capitalism and that there might be off the shelf answers on the simplest ways to go about it.

    So far no one has disputed that capitalism requires people to be able to own private property, to have the ability to gain more property, at least some freedom to work in return for money or property, and the existence of markets where prices for many goods at least roughly track what they would be in a free market.

    So we can say that if a state or region got rid of any one of these things, it would not be capitalist.

    But some other requirements for capitalism to exist have been suggested and I am not convinced that without them a society would not be considered capitalist and so I do not think they should be included in the definition.

    For example, Professor R.D. Wolff includes in his definition: “Capitalism, for me as for many others, refers to a system of production in which a small minority monopolizes the means of production requiring the mass of people to work for them in order to secure their means of life (food, clothing, shelter, etc.).”

    This means that Australia could make a relatively small change, such as introducing a guaranteed minimum income such as Finland is trialing, and it would no longer be capitalist as no one would need to work to secure their means of life such as food, clothing, shelter, etc.

    But while Professor R.D. Wolff clearly thinks this would stop Australia being capitalist, I am not satisfied that this would be the case, as all the basic activities that we accept as being part of capitalist societies would continue, the only difference is people wouldn’t have to perform them in order to get necessities. So in my opinion, making it unnecessary for the mass of people to work for their means of life is not a minimum change necessary to prevent capitalism from existing. However, you may think it is sufficient, in which case it might be the minimum change necessary to end capitalism in Australia and the other changes you suggested could be skipped, such as the communal owning of businesses and the elimination of income from the private ownership of capital.

    But if you don’t think that a guaranteed minimum income would be sufficient to end capitalism in Australia, then that means you agree with me that Professor R.D. Wolff’s definition is not correct. Or at least not an accurate description of how you view capitalism.

  18. @Ronald Brak

    A Guaranteed Minimum Living wage in return for guaranteed minimum work with leave, super and compensation entitlements would be a huge achievement within a capitalist welfare state.

    It will last as long as capitalism makes its profits and revenues exist to fund GMIs. In due course, due to underlying contradictions within capitalism, GMI and other welfare provisions will be destroyed by capitalists when they next gain government.

    This, in different ways, is what happened in UK (Thatcher), US (Reagen), NZ (Roger) and Australia (Fraser/Howard) etc under cries that such provisions:

    “…reward the lazy and defend bludgers”

    or demands for “austerity”.

    In the long run – capitalism must cut all wages and this includes any GMI.

    I do not know what the reference to Quiggin’s so-called “hybrid future capitalist economy” is meant to point to – but it is bound to fail in the long run.

  19. Ivor

    “hybrid future capitalist economy” are my words, not Professor Quiggin’s, so please don’t assign them to him without his knowledge or agreement.

  20. @Ronald Brak

    A guaranteed minimum income is certainly a socialist measure. Whether such, on its own, would be enough to make an entire economy socialist is very doubtful. Despite my warnings about definitions and categorisations of complex systems not being easy, you seem to persist in wanting extremely simple and literal definitions. I am not sure this is the way to gain an understanding of categories in “political economy” or “comparative economics”. You really need to read a few books on the subject if you want to understand such matters.

    However, since you push me to it.

    “An economy is capitalist when a simple majority of economically active people derive their main source of income from wages while working for an enterprise which is privately owned, in the majority, by owners who are other than the workers themselves. Said owners control the enterprise directly or through hired managers and seek to take a profit from the enterprise.”

    This definition is simple and generally correct. Pedantically, I would have to offer further definitions of terms like “economically active people”. You will be able to cavil in detail with my definition just as I would be able to cavil in detail at any simple definition you offered for the term “human”.

    An analogy has occurred to me. I don’t know if it will help. Alcohol and water are miscible in all proportions. I happen to suspect that socialist and capitalist aspects in an economy are also miscible in all proportions. How much there is of each in the mixture is an important factor in explaining the behaviour of the mixture and its effects on people.

  21. …there. The reason is that some one else would be deciding how much personal space each person would have access to for living.

    Well, yes. This is true of the world we currently live in, too. Unless you think that my deciding that I want to live in your front room is something our current society supports, which you probably don’t.

    “Private property” isn’t actually private at all, you see. Privately controlled, yes… but the possibility of private control is provided by the state [==community] providing courts, police, &c to maintain that control, or rather to exclude others from that control.

    [if the locus that determines what property “is” a person’s is not external to that person, then a person’s property is whatever they claim is theirs and can make stick. With, you know, sticks, and pointy sticks, and what-have-you. Not what you want: so property rights have to be determined externally, and anything that can do that needs to basically be a governance structure. ]

    Private property is a communal construction: what’s yours is yours because the state — not you — decides it to be so.

    Again, we’re going deep under the surface. It’s, like, quantum economics or something: your normal newtonian-type insights, “private property is mine and I control it and it gives me freedom from control over others”, is only approximately true: pretty close to accurate in most circumstances, but there are circumstances where it becomes pretty damned wrong. Same with my point earlier about competition. It’s true, but not usefully so in most circumstances… but you need to be aware of it, so that when you drift into the area when it becomes importantly true you don’t get blindsided by the way things change.

  22. Which is to say, your stuff is yours because the police arrest anyone who tries to make it not-yours.

  23. Hartnett-White is on the board of Will Happer’s new venture, the CO2 Coalition, built from one part of the old George Marshall Institute (read Merchants of Doubt). She is at The Texas Public Policy Foundation. Happer and co recently organized an open letter from “300 scientists” (sic) to give to Lamar Smith to help him hassle NOAA and waste more taxpayer money.

    Of the 308 signers:
    214 are in US, of whom
    32 (approx) are in TX, including many oil guys who *know* NOAA was doing wrong
    plus a few ex-NASA engineers and administrators for the Johnson Space Center
    The Houston area is very well represented*.
    94 are from outside the US, of which
    24 are from Australia, @1! Coal. mining, Jo Nova, David Evans, etc …
    plus Judy Ryan (retired epidemiologist) who took a course from (retired minerals&oil) Marjorie Curtis … who write a lot of letters.

    * See <a href="; for problems Houston is likely to encounter from storms and rising sea level …

  24. @Collin Street

    Please do not confuse personal private property with private enterprise.

    Ikon mentioned:

    an enterprise which is privately owned,

    You confused it with peoples front rooms (!!!) and various other misunderstandings.

  25. Ikonoclast, I certainly want an extremely simple definition because a simple one is much more useful to me on account of how I will be able to understand a simple definition. A definition I can’t understand is not useful to me. And I certainly want a literal definition because I find that definitions that contain metaphor tend to vary in how they are interpreted from person to person which greatly reduces the value of having a definition in the first place.

    But the definition you provided is simple and lacking in metaphor and I like it because I now know what you mean when you use the term capitalism. The definition doesn’t match all the ways you have used the term in the past, but if you stick to the definition from now on I will know what you are talking about.

    Now I’d like to see if other people want to get on board with your definition. Would anyone else be willing to use the definition for capitalism that Ikonoclast kindly provided?

    “An economy is capitalist when a simple majority of economically active people derive their main source of income from wages while working for an enterprise which is privately owned, in the majority, by owners who are other than the workers themselves. Said owners control the enterprise directly or through hired managers and seek to take a profit from the enterprise.”

  26. @Ronald Brak

    Oops, I made a mistake. I used the term “simple majority” when I should have said “absolute majority” or “more than 50%”.

    “An economy is capitalist when more than 50% of economically active people derive their main source of income from wages while working for an enterprise which is privately owned, in the majority, by owners who are other than the workers themselves. Said owners control the enterprise directly or through hired managers and seek to take a profit from the enterprise.”

    Further notes. From a Deloitte report in 2012;

    “The private sector (in Australia) employs 83% of Australian wage and salary earners, equivalent to 9.5 million Australians as at June 2011.”

    Now, this doesn’t exactly match my definition but at a rough guess about 80% of economically active people in Australia would derive their main source of income from wage work for private enterprise, as I defined things above. In turn, the defining of “economically active” will be somewhat problematic for my purposes. It is clear that non-working children and non-working students will be excluded. It is also pretty clear, I think, that the unemployed and pensioners will be excluded. However, self-funded retirees (whose super income is market linked or bank interest linked) might well have to be counted as economically active people as they are owners of shares in businesses directly or indirectly and usually derive their main income from that source. Self-funded retirees are capitalists or rentiers. Then, in turn, by a kind of technicality, recipients of defined benefit government super are not economically active and are not capitalists and/or rentiers…. or are they? Definitions get difficult at this point.

    Self-disclosure: I am a recipient of a defined benefit government super payment. I like to think I am not a capitalist or rentier. Question of the day, am I kidding myself in this matter?

  27. Self funded retirees are not capitalists because they use their assets to obtain their own living wage (which can be quite high). This does not disrupt the circular flow.

    However if a retiree uses their payment to employ a servant “on a wage” to grow vegetables which are then sold on the market for maximum revenue – then this is capitalism.

  28. @Ivor

    An interesting definition. But is not a self-funded retiree a “rentier” or “rentier capitalist”?

    “Rentier capitalism is a Marxist term currently used to describe … economic practices of monopolization of access to any (physical, financial, intellectual, etc.) kind of property, and gaining significant amounts of profit without contribution to society. The origins of the term are unclear; it is often said to be used in Marxism, yet the very combination of words rentier and capitalism was never used by Karl Marx himself.” – Wikipedia.

    Of course, all these problems of fine definition illustrate the relative futility (and probably social disutility) of attempting to tag each and every individual and enterprise as “capitalist” or “not capitalist”. More to the point is the identification of an entire system as capitalist, predominantly capitalist, mixed economy (mixed capitalist and statist, socialist or social democratic elements) or socialist and so on.

    To my mind, “capitalism” is a system tag and in turn various hybrid systems may exist in almost any proportions. “Capitalist” as a judgmental term is best reserved for the clear outliers who merit it. I will say no more on that point.

    It’s important to remember that some pure systems will never work. It is clear from historical examples trending that way, that a pure capitalist system would tear itself to shreds in short order. Pure socialism might disintegrate in a different way. However, in my opinion we need to move ourselves a long way towards the socialist end of the spectrum. Mere social democracy with a still predominantly capitalist base is not going to prove sustainable at this juncture in history (limits to growth plus late stage capitalism is a really dangerous combination) … again in my opinion.

  29. Further discussion of the definition of capitalism and so on should be taken to the sandpits, please

  30. @Ikonoclast

    If there is a degree of monopoly in the rent then it may be a form of capitalism due to this extra gain.

    But if rent only covers socially necessary labour costs to produce and repair the asset, there is no possibility of accumulating capital.

    There is too much junk in Wikipedia so cannot be used as a definitive basis for understanding these issues.

  31. I can’t resist another another post. Ronald Brak’s insistence of super simple definitions is a trap in many ways (intentional or not) and I fell into it. David Harvey’s marvelous short paragraph “definition” or explanation of capitalism given below illustrates well why my over-simplistic definition of capitalism falls well short of the mark.

    “Capital, Marx insists, is a process of circulation and not a thing. It is fundamentally about putting money into circulation to make more money. There are various ways to do this. Financiers lend money in return for interest, merchants buy cheap in order to sell dear and rentiers buy up land, resources, patents, and the like, which they release to others in return for rent. Even the capitalist state can invest in infrastructures in search of an improved tax base that yields greater revenues. But the primary form of capital circulation in Marx’s view was that of production capital. This capital begins with money which is used to buy labor power and means of production which are then brought together in a labor process, under a given technological and organizational form, that results in a new commodity to be sold on the market for the initial money plus a profit.” – David Harvey.

    In many ways, the above is an excellent and elegant short description of capitalism or at least of industrial capitalism. I am tempted at this moment to think it is the best short description I have found. It contains the seeds of understanding that capitalism is a process and an evolving process; that industrial capitalism could morph into something else like financial capitalism, information capitalism, prosumer capitalism or even prosumer socialism etc. etc. The first thing you need to understand if you are trying to understand capitalism is that you are trying to understand a system as it evolves before your eyes. There is no fixed target, definition or diagram which is going to be easily and simply understood.

  32. “I can’t resist another another post.”

    Please try harder, as any further OT posts in this thread will be deleted

  33. John Mashey,

    That list of 300 denialist signatories would be interesting to revisit in 5 and 10 years time to see if their opinions have changed.

  34. In this parallel universe, ex-minister speaks about how we (Austraya) are doing our bit, working hard to help businesses adapt to climate change, without considering the cuts they brought down the moment they got into power. Furthermore, it is misleading to talk about the money spent on climate change and mitigation research, without mentioning the current crop of redundancies of people doing the fundamental research upon which the mitigation and adaptation strategies are so reliant. This government, with a budget whose chief architect was Joe Hockey himself, did real damage, damage that is ongoing.

    On a lot of fronts, we are making good progress. Sadly, there are those who refuse to participate when they are the ones who can make the biggest difference, and that includes the government of the day. I think back to the early 1980’s, and how arguments about electric power cars would swirl around, with the inventors and the engineers (devoting free time) who would see it as something that could be made commercial, while on the other side of the fence the businesses and the governments said it couldn’t be done, so don’t fund it. Catch 22: fund it, and it can be done, or, say it can’t be done and don’t fund it. The missing meat in the sandwich was fundamental research that affected both the scope of available technology, and improved means to use it; some of that research was privately funded, some by government, but it always felt like driving with one foot on the brake and one on the accelerator. The same kind of loon arguments were applied to solar energy, and once again the arguments against it were based on the technologies available then, not on the new technological improvements made possible by investment in it; once again, many researchers, both scientific and engineering, led to what we have now. There is still scope for massive change in today’s solar energy methods, so we are nowhere near the limit of what is physically possible.

    Governments can make or break the necessary links that enable such changes to be accomplished. It is admirable that governments put some effort into research-to-business links, but that is really the tail of the dog; the rest of it is in the more blue-sky style, fundamental, research. We need to maintain, or to even increase, our efforts there. Fundamental research could just as easily be called keystone research, the stone that holds the rest of the arch above our heads.

  35. @Donald Oats

    With respect to the electric car, have you watched “Who killed the electric car?” The movie might seem dated now as Elon Musk has resurrected the electric car. However, it is not dated in the sense that it illustrates how new technologies or applications which we needed were delayed as long as possible by fossil capital.

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