Quote Originally Posted by rong View Post
So on the one hand, economics is something that the average person can't realistically be an expert in yet is forced to be via our voting system, and this leads to non-optimal economic and policy decisions. But at the same time we make a million decisions a year with our dollar in things we aren't expert in yet this is somehow optimal.
I don't think it is a contradiction because the votes are for entirely different things. The former is expecting voters to understand complexity, the latter is expecting consumers to consume.

Doesn't this demonstrate a hole in this argument? I don't, can't, dispute that a capitalist model efficiently allocates capital and leads to growth, innovation and clear improvements in living standards across the board. But a lot of this debate focuses on finding examples of situations where capitalism free markets aren't optimal and it seems to me the asymmetry of information in a world with products of growing complexity will lead to greater suboptimal decision making which will eventually reach a point whereby it is no longer efficient and the standard argument of corporate greed and companies having both a huge incentive and an easy opportunity to effectively mis-sell and deceive consumers leading to poor products, less innovation and therefore inefficiency.
Greed is good. Self-interest drives everybody's decision-making naturally. It is when this greed is met with competition from the greed of others that capitalism arises. In competitive markets, deception of customers does exist but it doesn't survive. For all we can tell, any market without too much government intervention is competitive. Two examples of this are Amazon beating up the previous monster-incumbent in Walmart and Google coming after ISPs.
This kind of ties in with my completely unfounded theory that capitalism and free ish markets ate optimal for a while but eventually need to be replaced with something that protects the public from powerful corporations and the harm their self interest will cause.
The above mostly addressed this, but I'll reiterate: I do not think this is problem. Centralized power doesn't appear to be a function in markets, but one of governments, by design and by regulatory capture. I believe if we had a government that was constitutionally restricted from intervening in any area that wasn't directly about unwillful coercion (like murder or mugging), then we would find there are no single companies with anywhere close to enough power to lord it over the consumers.

Comcast and Time Warner are among the best possible examples for this. Their power over the consumer is not a product of their size, but a product of governments. The barrier to entry into the ISP market is extremely high, costly, and layered in complexity because of regulations. Like I said before, if it wasn't for municipalities protecting voting incumbents and a variety of other regulations on all levels, Google Fiber would already be everywhere and Comcast would have to compete or die. The ISP scenario is slowly evolving because government intervention is hindering production big time, but it still is evolving. Apple probably would have jumped in too, as well as others. Nobody wants to do it because it's a legal nightmare now. Google is only doing it because their business model allows them to lose on Fiber as long as it forces incumbent ISPs to increase speeds, which increases Google's bread and butter: searches and ad revenue


The food industry is a great example of how everything has worked. There are some enormous corporations involved, yet because the market is relatively free, the competition is fierce, and any company that attempts the slightest bit of screwing the customer would suffer immensely. The biggest problem in food today are regulations like food subsidies and barriers to entry. The subsidies are greatly distorting what gets produced and sold, which is hindering all sorts of things like costs of other foods and innovation in products. There are many other barriers like Sabra is just now trying to get the government to make it illegal to call something "hummus" if it doesn't contain a certain amount of chickpea or something. This is bullshit and the reason we can't have nice things

The most dangerous incumbent by far is government. Even with government intervention, the biggest problem is the voters, not the companies. Voters create far, far, far bigger regulatory captures and market distortions than any companies. Why is education fucked and hyper expensive? The causality shows it's the voters, not businesses. Voters want bullshit like "no child left behind". Businesses want the opposite. It is very crazy how the vast majority of negative economic and social policies reflect the desires of the voters, yet the voters turn around and blame it on businesses. "Business" isn't even the good guys. Individual businesses love the idea of regulatory capture and rent seeking, but they can't get that without governments. Without governments even the biggest business conglomeration around today don't have a fraction of the capital it would take to coerce consumers. The market is the good guy. Think of the internet. It has always worked best when completely unregulated by a centralized power. Why is the rest of society different than the internet? The internet has permeated every aspect of human society and can be said to almost perfectly reflect what it means to be human society, and we have discovered that un-regulation works best

I do not think centralization of power and incumbents coercing consumers is a problem in capitalism. Those things happen via government, be it a dictatorship or a democracy