this post was submitted on 22 Jan 2024
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You also end up with management and incentive issues. You can correct those with violence or starvation in the short term and hope everything works out in the long term.
What, to you, is the difference between the owners being the government, and the owners being investors, all else being equal?
Do you think people don't get paid if there's no profit? Profit is just money left over after everyone gets paid and the bills are settled. It just goes to investors, and the employees don't see it.
Do you think that transition would happen without severe turmoil? That's the period I'm referring to. I think there's a huge difference in incentives to create new businesses as well as to keep running them efficiently between private investment and government...I'm not sure what method you propose to regulate industry.
It doesn't matter if people get paid if shelves are empty. The economy isn't a magical portal that delivers toilet paper to those in need: it's an insanely complicated set of (highly compromised at the moment, thanks to rich fucks and the officials/politicians they buy) human behaviors that act as market signals.
Why do you think there would be severe turmoil? In existing cases where the government has taken control of a business in the US, it's typically reduced turmoil, which is why they've done it.
The difference in incentive is that private investment is looking for profits, and public ownership is usually more concerned with stability or public welfare.
What do you picture a change in ownership looking like? Do you think that somehow means massive layoffs and changes in management? Why would shelves go empty? What calamity befell the economy when we nationalized passenger rail, airport security, or mortgage financing? Or when we temporarily nationalized GM?
If changing ownership decimates the economy, then why hasn't it been decimated already by routing changed in ownership that businesses have?
All this is aside from the original point, which is that profitability is not the same thing as solvency.
Siphoning some percentage of the companies revenue to investors isn't what makes the business work.
Are you talking about tiny changes or an entire economy? I don't think it's at all similar. What do you plan on doing with the owners you've taken property from?
Fuck if I know? I wasn't even advocating for anything, I was just explaining that "no profit" doesn't mean a business ceases to exist. An example of this is state owned enterprises, which don't turn a profit but still add to the economy and provide value to society. They pay their employees, and things are fine.
In a nationalization scheme, you can either compensate the investors a fair value, or seize their assets. Emminent domain is typically more fair, although recently examples tend towards either buying a controlling share at bankruptcy prices, or seizing the business outright and leaving shareholders in the lurch.
My take would be that if we're taking the business for the public good, we should pay a fair value for it, and if it's to stabilize something important that it's fine for investors to take the fall, since without stabilization they also would have lost their money.
Fair enough.
I think you'd meet more resistance than you expect, and I'm not convinced the goals of government officials are as sane as we'd like.
If that value is market value, we're kind of fucked.
To be clear, I don't disagree with your initial assertion. Markets pay people that notice inefficiencies. I'm just not convinced there's a better model.
I don't know that there's a better model either, but I'm very confident that we vastly overvalue investors in our current setup.
In an ideal society, I think workers would be compensated for the value they produce not the value they'll accept, and that's just incompatible with a society that structurally predisposed to value investment above labor.
I don't think there's a quick or easy path to get there, but in the meantime I'm aggressively unsympathetic to investor class woes.
In terms of nationalization for the common good, I'm generally referring to things like Amtrak or the TSA. There's a fair value that can be assessed largely independently of any market value.
In my ideal society we'd take care of each other.
Don't use the TSA as a fucking model. Shit.
How do you feel about compensation for shit like QA at peeps like boeing? Lots of us don't 'produce' but we're huge into it.
I'm not pedantic about "production" being actual literal "fabrication", but just a contrast to "rent seeking" or "investment".
Fair enough. Thanks for the conversation.