Does welfare and social security challenge the free market?

In a true free market, we would look like Somalia where everything goes.

For those that support it, please explain this scenario.

The oil industry in this country and those in it make very good money.
From the unskilled laborer at the bottom making 25 bucks an hour to the executives at the top pulling in millions.
Why did they shut down fracking fields instead of taking a pay cut among themselves to keep it going when the price of oil started to drop?
Because the big oil titans would rather work the market to their benefit than allow prices to fall further to hurt their profits.

The OPEC Cartel is still going despite the drop in oil prices.
It tells us they could have cut the price of oil a long time ago in accordance with free market principles and still stayed in business but wanted more profits so they kept it elevated.

There lesson learned is that there is no idealistic free market when humans are involved.
Just like there is no pure True Capitalism, Socialism or Communism when you throw humans into the equation.
It all looks good on paper though.


How come Apple pays 200 dollars with labor included for an Ipod and sells it to Americans for 600 bucks?
They could take a 300+ dollar cut in price and still be profitable in accordance with market principles.
Why don't they?

a reply to: onequestion

... the free market came to a screeching halt with the first minimum wage hike, and then again when they added social security.

Actually, Social Security is almost identical to an insurance policy.
In a nutshell, you pay premiums every payday in hopes you won't need it but if you do, it's there. It won't make you rich but is usually enough to keep you from starving to death... which is exactly as intended.

The free market has been slowly taken down by time and by various events such as wars, inflation caused by our dependence of imported petroleum and... well, this depression we've been in since bailing out the banks.

Of course, today... both left and right politicals would like to see SS taken down and burned because they dipped the funding, spending it on stuff we never really needed and now, don't want the blame to come back around to them.

a reply to: Bluesma

It is interesting that you mention entrepreneurs, because I have a little experience in that field. I am currently the managing director of a company. It is a tiny little company, and I am making virtually nothing doing it, personally. The company cannot afford to pay me worth a crap, to the point where I am earning close to two hundred pounds less per month, than the cost of renting the accommodation in which I live. Luckily, there are others here with me, and the costs are split. Now... I am not in business for myself, not in the least. I am not a capitalist by nature. I am in business so that when I pass on, there will be something for my son to either do, or sell, as he sees fit.

I am resigned to the fact that I, as an individual have no future, no expectation of advancement of my personal circumstances, no ability to aspire to move out to a place of my own, no ability to aspire to owning property of any kind, at any time in my life, and furthermore, and more immediately troubling to my soul, not even the ability to aspire to be able to afford to take a woman on a relatively nice date. My future, as far as I can make out (and bare in mind, I have a brain like a quantum computer where probability and possibility are concerned) will be entirely about working for the benefit of someone else, because the chances of me seeing any financial advantage to working for the rest of my life, are virtually none. Nil. Nothing. Between the cost of living, and the lack of other employment opportunities available, even the best I can do, working at making this business profitable by the time I die is the only route I have to provide for my son. Not me, my son. I know that I will never have an actual life, independent of my responsibility to provide financially for his future, because my future has no liquidity in store, no assets on the horizon.

Short of a lottery win (which is unlikely since I can't afford to waste money on maybes and therefore elect not to buy tickets) I will never have a chance to LIVE, and will only be afforded the opportunity to exist, for the rest of my days, slugging it out on behalf of my boy. I will do it, and feel lucky that I can, because there are those out there far less fortunate than me, who will not even have a CHANCE to provide for their kids. But that does not mean that my life, as an individual, will ever improve or nourish me in all the ways that matter. Providing for my son is all I have left, the only option available, and it will be the work of my whole life, from now until I die. I am resigned to that, because that is all I can see ahead, and trust me, my eyesight is laser precise.

I have nothing, and as far as anyone can tell, that is not going to change, despite the fact that I work like a Godamn machine, day in, day out. How can this be my best option? Ask a captain of industry who farmed out all the real work to nations with no labour laws and wages lower than the Mariana Trench. Ask the industry experts who recommend paying staff in western nations less than it costs to live, ask the conservative government of my nation who have systematically destroyed this place for the working poor!

Everything has gone to crap, and the best I have to look forward to is to be skint and alone by the time I die, just so that my boy has a CHANCE at something later in his life. That is not the doing of socialist policy, but the doing of those who took jobs out of this nation to save money, rather than keeping them here to save this nation. Traitors. Treasonous cutpurses and bastards the lot of them.

ahhh... ya, the good ole days...
when there were workhouses to send the poor to live, and work, and get fed poorly, treated poorly, and often times beaten...
when slaves were bought and sold, owned and worked, beaten and hung...
when women were locked into the factories so they wouldn't wander off and "go shopping".. occasionally there would be fires, and all these women would trample each other to death trying to get to the locked doors that wouldn't open.
when governments would send the troops in to protect the business interest and force the striking workers back to their jobs.
when young children would be sent into dangerous mines to plant explosives.
when the workers ended up owing the company stores much more money at weeks end than they made and were force to work until that bill was paid off which would never happen.
I could go on...but well got to say
yep, those were grand ole times!!!

the jobs didn't go away because of the social programs or the minimum wage. the same element that brought about the stuff I listed is also responsible for the jobs problem now.... companies like apple, wanting larger profits, shipping jobs overseas, but well, the promise of cheaper goods might have been fullfilled in the shortrun, but we are paying way more now for our goods and well if you include the cost of those social programs to keep the people from revolting into the mix, we are paying an outrageous price! and heck the gov't actually bribed some of these companies to go offshore.... and would someone like to explain to me why probably over 50% of my hometown's rental units are owned by former elected mayors, legislators, ect.

the only way either system would work perfectly would be to eliminate the factor of human greed from the picture. but to paint a picture of the past as such a grand time in an effort to convince us that giving businesses free reign would be such a great improvement indicates to me that either someone needs a history lesson, or well, they are insane enough to think that they will somehow find a way to become one of the future's robber barons.

the idea that society should take care of the poor, the elderly, the sick, has been in existence since at least colonial times. all the rhetoric about how it encourages laziness and removes the need for people to be responsible has been said many times before. go back in history and see for yourself. and well, be sure to note just how the changes that were made when that rhetoric was bought "improved" things.

originally posted by: onequestion
a reply to: SaturnFX

So the removal of these programs would quickly highlight issues and initiate massive change immediately?

Government-backed welfare systems created a problem to which they were the only answer.

Prior to that, welfare was handled by the community.

Welfare systems themselves aren't a bad thing or even anti-free market. They can provide a very useful safety net, keeping a community healthy overall, even reducing crime rates. The problem (and it really is a massive problem) is when they become official institutions that offer a viable alternative to engaging in the free market.

The problem extends even further than just the market - once the government controls welfare, votes can be bought with it. Vote for us, we'll give you even more free stuff! A vote for us is a vote for a better life where you don't need to worry about education or getting up to go to work! Next thing you know you're into your third generation of people in deprived areas who's idea of a job is to breed more to get more money. Because trying to improve your own lot in life is for suckas, yo.

A "safety net" should be about keeping you alive - food, shelter, warmth - not maintaining a minimum quality of life that involving brand new electrical goods and weekly trips to the hairdresser.

originally posted by: EvillerBob

originally posted by: onequestion
a reply to: SaturnFX

So the removal of these programs would quickly highlight issues and initiate massive change immediately?

Government-backed welfare systems created a problem to which they were the only answer.

Prior to that, welfare was handled by the community.

Welfare systems themselves aren't a bad thing or even anti-free market. They can provide a very useful safety net, keeping a community healthy overall, even reducing crime rates. The problem (and it really is a massive problem) is when they become official institutions that offer a viable alternative to engaging in the free market.

The problem extends even further than just the market - once the government controls welfare, votes can be bought with it. Vote for us, we'll give you even more free stuff! A vote for us is a vote for a better life where you don't need to worry about education or getting up to go to work! Next thing you know you're into your third generation of people in deprived areas who's idea of a job is to breed more to get more money. Because trying to improve your own lot in life is for suckas, yo.

A "safety net" should be about keeping you alive - food, shelter, warmth - not maintaining a minimum quality of life that involving brand new electrical goods and weekly trips to the hairdresser.

Exactly. Welfare and social programs should be handled by the local community. The local community is in a better position to manage and judge recipients than a disconnected bureaucrat. The federal government is very inefficient when it comes to charity.

People are kind and will not let deserving people starve in the streets.

Look around any community and you will see where both rich and poor donate time, money, and resources for a variety of social causes with little to no involvement from the government. Hospitals, schools, art, museums, parks, soup kitchens, and other public goods are often entirely funded by the generosity of others.

These social services done at the federal level and even at the state level become rife with bureaucracy and top heavy with administrative costs. They are disconnected from the people who need the help the most and the sheer volume they try to handle makes them susceptible to misuse and fraud.

A family truly in need will need to look their neighbors in the eye when asking for a handout when these services are handled locally versus a family has become dependent upon a faceless welfare state that only sees them as a case number.

Government crowds out local charity.

a reply to: Edumakated

We were headed that way, where communities were more involved in their health and welfare. Then Reagan came along:

The REAGAN ADMINISTRATION'S budget and policies radically altered the relationship between the federal government and the states. For the first time in many years federal aid to states declined, and Reagan pushed to consolidate categorical grants into BLOCK GRANTS, which had few strings and much broader categories, such as "education" or "highways." Because New Federalism meant that states often had to pay the tab for their new responsibilities, Reagan was criticized for weakening the states with debt — an opposite effect from his stated intention

Source www.ushistory.org...

a reply to: TrueBrit

I started my own company several years ago. I did it because of my own internal drives for creation and independence.
There was no illusions on my part- I didn't expect to get rich, money was not the motivation.

After a couple of years, it was worth enough to sell at a good price, and I did so. The fun was in creating and nurturing it and finding solutions to obstacles... once it was running smoothly, I didn't feel like working 12 hour days for so little.

I sold it to a couple, who, together, were able to take it further and make it expand. I couldn't do that at the time as I had kids at home and was running it alone.

I am not sure how you can keep going on such a bleak outlook, I constantly need goals before me and some confidence in my abilities to reach them.

But what was interesting was that I got my capital for this from my unemployment that I had paid into for three years as an employee. I had the choice of receiving a fixed amount each month for three years, or getting it all in one lump sum for starting my business!

I could have reaped more money each month sitting on my butt and doing nothing. Why didn't I?

Because the desire for active creation and independence was too strong. Humans have all kinds of drives that go further on up the Maslow's pyramid of needs!

originally posted by: MOMof3
a reply to: Edumakated

We were headed that way, where communities were more involved in their health and welfare. Then Reagan came along:

The REAGAN ADMINISTRATION'S budget and policies radically altered the relationship between the federal government and the states. For the first time in many years federal aid to states declined, and Reagan pushed to consolidate categorical grants into BLOCK GRANTS, which had few strings and much broader categories, such as "education" or "highways." Because New Federalism meant that states often had to pay the tab for their new responsibilities, Reagan was criticized for weakening the states with debt — an opposite effect from his stated intention

Source www.ushistory.org...

In other words, the states mismanaged their responsibilities. This is why I said even administering programs at the state level may be too high up. State house politicians are almost as bad as their federal brethren when it comes to mismanaging tax payer funds.

The problem is these programs only grow. They never get smaller. The bureaucracy is always looking to expand. You NEVER hear any of these programs say "Hey, our programs are working, let's cut our budget in half and give the money back to the tax payers". In my mind, a successful welfare program is a program that in which welfare is not needed. Success is not measured by how many people you put on welfare, but how many people you can get off it.

Here is Thomas Sowell discussing the negative effects of liberal welfare policies on black america.

a reply to: Edumakated

First came the good old move to defund, strangle. Especially the mental health institute.

What is wrong then with states where about 20 percent of its people can't afford food:
"States with the most people on food stamps:

7. Louisiana

• Number of food stamp recipients: 868,192

• Percentage of the state's population on food stamps: 18.67%

• Total cost of just these benefits alone (That is, how much do just the money on those EBT cards cost the state): Around $107.4 million

• Cost of benefits alone per capita in this state: $23.10

6. Tennessee

• Number of food stamp recipients: Just over 1.28 million

• Percentage of the state's population on food stamps: 19.58%

• Total cost of just these benefits alone (That is, how much do just the money on those EBT cards cost the state?): Around $158.7 million

• Cost of benefits alone per capita in this state: $24.23

5. Oregon

• Number of food stamp recipients: 791,222

• Percentage of the state's population on food stamps: 19.93%

• Total cost of just these benefits alone (That is, how much do just the money on those EBT cards cost the state?): Around $98 million

• Cost of benefits alone per capita in this state: $24.66 per person

4. West Virginia

• Number of food stamp recipients: 369,249

• Percentage of the state's population on food stamps: 19.96%

• Total cost of just these benefits alone (That is, how much do just the money on those EBT cards cost the state?): Around $45.7 million

• Cost of benefits alone per capita in this state: $24.69 per person

3. New Mexico

• Number of food stamp recipients: 448,328

• Percentage of the state's population on food stamps: 21.5%

• Total cost of just these benefits alone (That is, how much do just the money on those EBT cards cost the state?): Around $55.5 million

• Cost of benefits alone per capita in this state: $26.60 per person

2. Mississippi

• Number of food stamp recipients: 650,911

• Percentage of the state's population on food stamps: 21.74%

• Total cost of just these benefits alone (That is, how much do just the money on those EBT cards cost the state?): Around $80.5 million

• Estimated cost of benefits alone per capita in this state: $26.90 per person

1. District of Columbia

• Number of food stamp recipients: 144,768

• Percentage of the state's population on food stamps: 21.97%

• Total cost of just these benefits alone (That is, how much do just the money on those EBT cards cost the state?): Around $18 million

• Estimated cost of benefits alone per capita in this state: $27.19 per person"

Source: www.usatoday.com...

Technology is going to either take us to something like the hunger games or if we're luck to something like star treks social utopia. We're getting really advanced and soon will hopefully have no need for money. 100 years from now I truly believe we could progress to the point where poverty is completely eliminated because of emerging technologies.

a reply to: Slickinfinity

Scarcity is a constant in the universe, there is not enough of everything for everybody.

The way we have uplifted over a billion out of poverty was by recognizing that and promoting markets so that each individual could make their own choices about what standard of living they are willing to work for and then not taking the stuff that they have earned.

Money is an indirect medium of exchange, nothing more. Money is anything that is widely accepted as a substitute for direct barter. It's absence makes trade more difficult and promotes waste.

As an admitted fan of ST, I can never forgive Roddenberry for instilling such a destructively impossible expectation to multiple generations. At a certain point though, everybody has to take responsibility for their own misunderstandings about economics.

originally posted by: onequestion
In a perfect free market world poverty would actually be a point of contention as the people would demand more due to the fact that there would be no net to catch them.

Am I right about that premise?

So the free market came to a screeching halt with the first minimum wage hike, and then again when they added social security.

Would the market demand a better wage in order to effectively compensate for a retirement if the government didn't create a social security system?

What do you think ATS?

Free markets are all about doing things at the lowest cost possible, which ultimately is slavery. It requires safety nets in order to free people from that. Additionally, purely free markets don't work because free markets are based on the concept of both sides of a deal having relatively equal negotiating power.

In a world with productivity as high as it is, the employee has no negotiating power, and therefore can't secure a fair deal for themselves. Similarly the inverse can be true in a sector where there's a lack of qualified workers, in that case the employer can't secure a fair deal... this for example is why so many tech companies fail.

Equal negotiating power can really only be reached when there's a safety net so that people don't have to work, and when there's ample job training available so that employers can find the employees they need. Essentially, it requires a market where no one needs anyone but people still want to work together for mutual benefit.

The open market or basically the illegal ponzy pyramid scheme of owning everything by the elite, is threatened by strong, equal citizens who look after their own, somewhat, and have social programs. They hate this.

Also, we don't go far enough. We need houses for everyone and either no money at all and abundance for all, OR, all incomes including social programs, and disabilities need to be considered real money, with homes and utilities no more than 1/4 of your income, and everyone above the poverty line, for family size.

And dental, with teeth replacement, not dentures, ie crowns, and pegs all afforded.

Basically, if a planet has technologies (and they should be clean energy technology which exists and isn't used), its expected to use all those technologies for their citizens, ie for example, we can make homes out of hempstone, cob, and don't even require heavy use of fossil fuels. And keep thinking there are even more advanced simple solutions. Or for the teeth, pegs cost about 50 dollars and molds yet they cost you 4500 per tooth.

If you don't apply the technologies to improve the quality of life of all people and planet, YOU'RE A RENEGADE AND GET A BIG FAT F WHEN LIFE REVIEWS OCCUR.

The elite here, think they have a natural divine right because they clawed their way to the top and are the top predators and serve the top predator god(s) of the universe. They're very mistaken.

originally posted by: BELIEVERpriest
a reply to: SaturnFX

Jesus would give us the choice to contribute as a community, unlike the federal government who just loves to collect taxes against our will.

Calm down.

There is no such thing as a government that doesn't collect taxes. I'm really tired of the argument against Socialism being framed as it being bad because the government taxes the population. It's dishonest. There has never been a government that doesn't collect taxes and there never will be one. So Socialism can't be bad because the government collects taxes.

originally posted by: Krazysh0t

originally posted by: BELIEVERpriest
a reply to: SaturnFX

Jesus would give us the choice to contribute as a community, unlike the federal government who just loves to collect taxes against our will.

Calm down.

There is no such thing as a government that doesn't collect taxes. I'm really tired of the argument against Socialism being framed as it being bad because the government taxes the population. It's dishonest. There has never been a government that doesn't collect taxes and there never will be one. So Socialism can't be bad because the government collects taxes.

I don't know of anyone who argues that there should be no government. However, it must be recognized that government has to be constrained or else it grows out of control. This is why our founders wanted limitations and checks and balances. Government is the ultimate monopoly.

originally posted by: Edumakated

originally posted by: Krazysh0t

originally posted by: BELIEVERpriest
a reply to: SaturnFX

Jesus would give us the choice to contribute as a community, unlike the federal government who just loves to collect taxes against our will.

Calm down.

There is no such thing as a government that doesn't collect taxes. I'm really tired of the argument against Socialism being framed as it being bad because the government taxes the population. It's dishonest. There has never been a government that doesn't collect taxes and there never will be one. So Socialism can't be bad because the government collects taxes.

I don't know of anyone who argues that there should be no government. However, it must be recognized that government has to be constrained or else it grows out of control. This is why our founders wanted limitations and checks and balances. Government is the ultimate monopoly.

What you just said there has nothing to do with the government collecting taxes. Our government DOES have checks and balances.

originally posted by: Krazysh0t

originally posted by: Edumakated

originally posted by: Krazysh0t

originally posted by: BELIEVERpriest
a reply to: SaturnFX

Jesus would give us the choice to contribute as a community, unlike the federal government who just loves to collect taxes against our will.

Calm down.

There is no such thing as a government that doesn't collect taxes. I'm really tired of the argument against Socialism being framed as it being bad because the government taxes the population. It's dishonest. There has never been a government that doesn't collect taxes and there never will be one. So Socialism can't be bad because the government collects taxes.

I don't know of anyone who argues that there should be no government. However, it must be recognized that government has to be constrained or else it grows out of control. This is why our founders wanted limitations and checks and balances. Government is the ultimate monopoly.

What you just said there has nothing to do with the government collecting taxes. Our government DOES have checks and balances.

It has everything to do with collecting taxes. Taxes are what feed a growing government. No matter how much government collects, it will never be enough because politicians can always find away to spend our money. This is the crux of the problem.

Unlike businesses, government has no competition. It does not have to be efficient. It never goes out of business. Never fails. They can just print more money or collect more taxes.

This is why the fewer things government does, the better. It provides less of an opportunity for corruption, nepotism, and lobbying. Socialism is nothing more than government being a sugar daddy to the common man. Unfortunately, that sugar comes out of the pocket of the productive.

a reply to: Edumakated

Well unrestrained capitalism has been shown to be ineffective and create tons of inequality. It results in businesses cutting corners on worker safety as well as product safety. It results in businesses pitching merchandise that doesn't do what is advertised.

Democratic Socialism on the other hand takes the best parts of capitalism (the ability to rise out of your living conditions with the right work ethic) as well as the best parts of socialism (caring about the people). This is why during our country's golden years we were heavily Democratic Socialist (even Republicans agreed with socialism at the time). Though we still are DS, just not as much as then.