Adam Smith is seen as the person most responsible for coming up with the concept of capitalism, and he hated landlords.
“Landlords’ right has its origin in robbery. The landlords, like all other men, love to reap where they never sowed, and demand a rent even for the natural produce of the earth.”
Adam Smith imagined a world with well-regulated capitalism. In that world, a capitalist might invest in a factory to make a widget. They’d take raw materials, use capital (including labour) and end up with a product that people would want to buy. That capitalist would always have to stay on their toes because if they got lazy, another capitalist could undercut them by using their capital better, to either undercut the widget’s price, or to sell it more cheaply. This competition was key, as well as the idea of the capitalist putting in work to continuously improve their processes. A capitalist who didn’t continually improve their processes would lose to their competitors, see their widget sales drop to zero, and go out of business.
In Adam Smith’s time, the alternative to capitalism was feudalism, where a landlord owned a huge estate, had serfs working on that estate, and simply collected a cut of everything the serfs produced as rent. In that scenario, the landlord had to do almost no work. It was the farmers on their estate who did the work. The landlord just owned the land and charged rent. Originally, serfs were even tied to the land, so they weren’t allowed to leave to work elsewhere, and their children were bound to the same land. But, even once that changed, there was still good farmland. The landlord could lower the rent until it was worth it for a farmer to work the land. The key thing is that the landlord didn’t have to do anything at all, just own the land and charge rent for its use.
I think the reason that people are so pissed off with capitalism these days is that what we’re really seeing is a neo-Feudalism, or what Yanis Varoufakis calls technofeudalism.
Think of YouTube. A person puts tons of time and money into making a video, they upload it to the only viable video platform for user-made video, YouTube. YouTube hosts the video, then charges a big cut of any advertising revenue the video generates, basically charging rent for merely being the “land” on which the video lives. In a proper capitalist world, there would be plenty of sites to host videos, plenty of ad companies competing to buy ad spots for a video, etc. But, YouTube is a monopoly, and internet advertising is a duopoly between Google and Facebook. They mostly don’t even compete anymore, each has their own area of the Internet they control and so they’re a local monopoly. This allows them to behave like feudal lords rather than capitalists. There’s no need for them to innovate, no need for them to compete, they just own the land and charge rent. Same with Apple and their app store. There are no other app stores permitted on iPhones, so Apple can charge an outrageous 30%.
It goes well beyond tech though. Say you’re a Canadian and you want to avoid American products, but you love your carbonated beverages. You could buy Coke, but that’s American. Pepsi? That’s American. Royal Crown cola? Sure sounds like it might be Canadian, or British, but no, it’s American. Just look at the chain of mergers for its parent company: “Formed in July 2018, with the merger of Keurig Green Mountain and Dr Pepper Snapple Group (formerly Dr. Pepper/7up Inc.), Keurig Dr Pepper offers over 125 hot and cold beverages.” Sure, if you look you can find specialty things like Jarritos, but the huge brands just dominate the shelves.
Capitalists hate capitalism, they want to be feudal lords, and since the time of Reagan / Thatcher / Mulroney / etc. competition hasn’t been properly regulated, allowing all the capitalists to merge into enormous companies that no longer have to compete, and can instead act as feudal lords extracting rent.
Which is why buybacks need to be illegal again, and dividends need to be regulated and taxed better baed on factors like how much the company benefits the community.
And employees need to be guaranteed a proportional cut too, ensuring that better performance and higher company earnings always means they earn more, and not that they get fired and the one who gets a bonus is some random CEO who only kept trying to push bad ideas the employees kept fighting all the time.
ALL forms of making money from having money need to be abolished completely.
If you’re not creating/selling a product or providing a service, you’re not EARNING money. Furthermore, rich people getting richer through passive income is the #1 thing diminishing the returns from actually worthwhile endeavors.
I somewhat agree with you. And I 150% agree that “rent seeking behavior” doesn’t add to society.
But what if you want to sell a product you designed but can’t afford to create it or to setup a factory for it, so you want funding, so you try to get investments, maybe by selling equity in your company.
Is that not valuable to society? The people that take the risk that your product may not sell?
But what if you want to sell a product you designed but can’t afford to create it or to setup a factory for it, so you want funding, so you try to get investments, maybe by selling equity in your company. Is that not valuable to society? The people that take the risk that your product may not sell?
That’s where small business grants from the government comes in.
Helping people thrive without being beholden to ruthless opportunists or run the risk of bankrupting private investors is EXACTLY the kind of thing tax dollars should be spent on in stead of the MIC, subsidies for the most profitable corporations in the world, and other such enriching of the already rich.
This is mythical thinking. Frankly, there’s just not that many products that need inventing, particularly that need a factory. We are past the era where a revolutionary bread slicer will change society. Most of the actual advancements we are seeing come from grants into general scientific research. Not from some lone Einstein with a vision.
What actually is happening is some of these discoveries are very good and they ultimately get scooped up and patented by some corporate entity that thought the research was marketable.
Recognizing that reality, that innovation basically never comes from the founders of a company, should really lead you to understand what’s broken about the US economy.
Before currency was invented might be a stretch— back then, which was a long long long, time ago we likely didn’t even have professions in the same sense. Albeit Dave might have had a knack for fishing, Kendra for making canoes etc.
There was plenty of space in the wilderness you could just go live for free. Now we have a lot of people, we need agriculture to support that population; there isn’t enough land for hunter gatherer societies to exist without a large population collapse first.
Now to your point I suppose we could have a society without money; yet I think there is some freedom in currency even if everyone gets a UBI. It allows two random strangers to come together and have one person buy something without having to trade an item that the other person wants, then the seller can go buy something they want.
Without currency we would have to have a somewhat complex trading system, which inevitably would see certain items of rarity never traded, or traded for so much surplus goods that a new ironically materialistic moneyed class would develop. It would make for an interesting book, but I think so long as people have varied interests and desires, and create creative works, money is a useful thing.
Without money, money is reinvented. For practicality reasons you want a fungible means of exchange that also lasts. Being small, portable, and not spoiling is also desirable.
That means precious metals or vouchers for something. If you standardize these, you end up with money again.
Without a standardized currency, you end up with a bunch of parallel currencies. That means there will be businesses, who only deal with exchanging one form of currency for another. They could even give out their own vouchers.
Now, the state also wants to collect taxes. Collecting a bunch of different vouchers and coins is a headache. So the state issues their own vouchers, which you have to use to pay taxes. Then we are back where we started.
An interesting approach to money would be, if money had an expiration date. So you have to spend it, or lose it. That keeps it in circulation, leading to more economic activity. Inflation serves this purpose as well.
That’d just lead into investment into non-monetary things. For example, buying precious metals or bonds or stocks or property and selling them as needed.
To actually fix problems with wealth disparity, you need a wealth or property tax.
Yeah, it turns out that a system that rewards people for simply having possession of something leads to behaviors that are harmful for society.
The problem isn’t landlords, that’s just the group that most people interact with directly. The problem is that our rules (primarily taxes) are setup to reward that behavior and to add burden to people who actually do work for their income.
If you’re a billionaire you can get your effective tax rate to single digits or zero. If you work for a living you pay way more taxes proportional to your income.
Getting a paycheck automatically means that someone has more money before a product, or service is delivered. So I’m gonna stretch this a little… If we like jobs that pay money then we gotta live with rich assholes. But if we want no rich assholes and truly everyone’s time is worth exactly the same amount, then we need something other than capitalism. We need socialism. But how do we prevent kings or rich politicians in either scenario? Tax them in capitalism for one. In socialism we just downright make that illegal.
Instead of a rich asshole, you can have worker owned cooperatives and such.
everyone’s time is worth exactly the same amount
That’s just objectively not the case. Some people are able to provide more essential or better quality services and labor than others. There are also more and less enjoyable activities.
Everyone’s time can be worth the same amount for the same activity at the same quality level.
how do we prevent kings or rich politicians in either scenario? Tax them in capitalism for one. In socialism we just downright make that illegal.
You will always have people in more powerful positions and some will take advantage of it. What you can do is rotate people with term limits and such. However that can also have downsides in effectiveness and efficiency.
You can also impose limits on how much stuff a person can own. There are ways to circumvent this with non profit NGOs and such.
Socialist economies also need taxes to pay for infrastructure and the operations of the state.
This is basically where not even I believe in myself.
Cooperatives… A few billion of us get together to build a rocket…never gonna happen. A few of us build a power plant…yeah right! Never gonna happen.
What about life? My life, how much is my life worth? Is it worth more than yours or less? Divided into life/second, if I’m worth the same as you are, then I should get paid the same as you no matter what I do… I could be a painter or a seamstress or a cook or a bricklayer. I should be worth the same. Even a bum who wants nothing to do with anyone should be worth the same as the most smartest person to ever live. Its a life. You don’t get to be worth more by being smarter or making more stuff.
I would definitely not want to live in a society where my kids will be homeless even though I am the hardest working worker. If my kids are lazy I still want to ensure they live better than I did. So although I don’t like this consumerism centric capitalistic society, that socialistic society sucks.
I much rather be in a society where you can own things and give them to your kids, and have those things hold some value. I don’t want the government limiting what I can and cannot do. To some extent I think this sort of capitalism is possible, but the billionaires have got to go puff. I would love living a grand life with a big house in a sunny part of California. That’s impossible now no matter what I say or do. Meanwhile some billionaire could just buy California if he wanted to. That sort of money accumulation I’m totally against.
In other words, the fact that thing A would “destroy of the economy if everyone did it” is an emergent property of everyone doing it, which doesn’t apply to any single entity doing thing A.
That guy said what I was pointing out. Also, it’s not a hyperbole, it would absolutely destroy the economy if everyone did the same thing regardless of what that thing is. Even if everyone decided eating chicken would be the only protein that we eat would destroy the economy. Which is why I added my edit. It’s not just about a profession, but anything, literally anything done in unison by every other human would wreck an economy.
Are you’re saying that if an economy has an increse the concentration of farming activity then economic ouput will deteriorate as fast as if it were to have instead had the same increase the concentration of parasitic activity? Very interesting idea.
Maybe I’m dense but the only way I can see that working is if the parasites become super-effective livestock and can be turned into food that is either more nutrious or has a longer shelflife than the feedstock.
Huh? I’m saying if everyone dropped whatever it is they normally do and instead all do the same exact thing, it would ruin an economy. We need diversity regardless of whatever else is happening. We couldn’t survive if everyone became farmers and no one become engineers. So ultimately, it’s a pointless statement to say if everyone did anything, such as landlording, the economy would be ruined.
Real estate Management is about rent collection, property maintenance, coordination of finding new tenants, etc. There’s labor there.
Many single property landlords are also real estate management and handymen of their own properties. And that part of the situation is actual labor.
In common parlance, people will often conflate these. But I find this dilutes the harm caused by actual landlords, which are mostly large corporations that simply own property and collect income.
Landlording is not a profession.
Handyman is a profession. Real estate management is a profession. Landlording is simply siphoning money through the act of owning something.
The economy can tolerate a finite number of leaches before dying. We currently have too many. The ideal number is zero.
It’s also not capitalism.
Adam Smith is seen as the person most responsible for coming up with the concept of capitalism, and he hated landlords.
“Landlords’ right has its origin in robbery. The landlords, like all other men, love to reap where they never sowed, and demand a rent even for the natural produce of the earth.”
More details about what he thought of rent in his book An Inquiry into the Nature and Causes of the Wealth of Nations.
Adam Smith imagined a world with well-regulated capitalism. In that world, a capitalist might invest in a factory to make a widget. They’d take raw materials, use capital (including labour) and end up with a product that people would want to buy. That capitalist would always have to stay on their toes because if they got lazy, another capitalist could undercut them by using their capital better, to either undercut the widget’s price, or to sell it more cheaply. This competition was key, as well as the idea of the capitalist putting in work to continuously improve their processes. A capitalist who didn’t continually improve their processes would lose to their competitors, see their widget sales drop to zero, and go out of business.
In Adam Smith’s time, the alternative to capitalism was feudalism, where a landlord owned a huge estate, had serfs working on that estate, and simply collected a cut of everything the serfs produced as rent. In that scenario, the landlord had to do almost no work. It was the farmers on their estate who did the work. The landlord just owned the land and charged rent. Originally, serfs were even tied to the land, so they weren’t allowed to leave to work elsewhere, and their children were bound to the same land. But, even once that changed, there was still good farmland. The landlord could lower the rent until it was worth it for a farmer to work the land. The key thing is that the landlord didn’t have to do anything at all, just own the land and charge rent for its use.
I think the reason that people are so pissed off with capitalism these days is that what we’re really seeing is a neo-Feudalism, or what Yanis Varoufakis calls technofeudalism.
Think of YouTube. A person puts tons of time and money into making a video, they upload it to the only viable video platform for user-made video, YouTube. YouTube hosts the video, then charges a big cut of any advertising revenue the video generates, basically charging rent for merely being the “land” on which the video lives. In a proper capitalist world, there would be plenty of sites to host videos, plenty of ad companies competing to buy ad spots for a video, etc. But, YouTube is a monopoly, and internet advertising is a duopoly between Google and Facebook. They mostly don’t even compete anymore, each has their own area of the Internet they control and so they’re a local monopoly. This allows them to behave like feudal lords rather than capitalists. There’s no need for them to innovate, no need for them to compete, they just own the land and charge rent. Same with Apple and their app store. There are no other app stores permitted on iPhones, so Apple can charge an outrageous 30%.
It goes well beyond tech though. Say you’re a Canadian and you want to avoid American products, but you love your carbonated beverages. You could buy Coke, but that’s American. Pepsi? That’s American. Royal Crown cola? Sure sounds like it might be Canadian, or British, but no, it’s American. Just look at the chain of mergers for its parent company: “Formed in July 2018, with the merger of Keurig Green Mountain and Dr Pepper Snapple Group (formerly Dr. Pepper/7up Inc.), Keurig Dr Pepper offers over 125 hot and cold beverages.” Sure, if you look you can find specialty things like Jarritos, but the huge brands just dominate the shelves.
Capitalists hate capitalism, they want to be feudal lords, and since the time of Reagan / Thatcher / Mulroney / etc. competition hasn’t been properly regulated, allowing all the capitalists to merge into enormous companies that no longer have to compete, and can instead act as feudal lords extracting rent.
This actually applies to most all investments.
Which is why buybacks need to be illegal again, and dividends need to be regulated and taxed better baed on factors like how much the company benefits the community.
And employees need to be guaranteed a proportional cut too, ensuring that better performance and higher company earnings always means they earn more, and not that they get fired and the one who gets a bonus is some random CEO who only kept trying to push bad ideas the employees kept fighting all the time.
ALL forms of making money from having money need to be abolished completely.
If you’re not creating/selling a product or providing a service, you’re not EARNING money. Furthermore, rich people getting richer through passive income is the #1 thing diminishing the returns from actually worthwhile endeavors.
I somewhat agree with you. And I 150% agree that “rent seeking behavior” doesn’t add to society.
But what if you want to sell a product you designed but can’t afford to create it or to setup a factory for it, so you want funding, so you try to get investments, maybe by selling equity in your company. Is that not valuable to society? The people that take the risk that your product may not sell?
That’s where small business grants from the government comes in.
Helping people thrive without being beholden to ruthless opportunists or run the risk of bankrupting private investors is EXACTLY the kind of thing tax dollars should be spent on in stead of the MIC, subsidies for the most profitable corporations in the world, and other such enriching of the already rich.
This is mythical thinking. Frankly, there’s just not that many products that need inventing, particularly that need a factory. We are past the era where a revolutionary bread slicer will change society. Most of the actual advancements we are seeing come from grants into general scientific research. Not from some lone Einstein with a vision.
What actually is happening is some of these discoveries are very good and they ultimately get scooped up and patented by some corporate entity that thought the research was marketable.
Recognizing that reality, that innovation basically never comes from the founders of a company, should really lead you to understand what’s broken about the US economy.
How did anyone do anything before currency was invented?
Your comment implies that what you describe is a requirement for a functioning society
It isn’t.
Before currency was invented might be a stretch— back then, which was a long long long, time ago we likely didn’t even have professions in the same sense. Albeit Dave might have had a knack for fishing, Kendra for making canoes etc.
There was plenty of space in the wilderness you could just go live for free. Now we have a lot of people, we need agriculture to support that population; there isn’t enough land for hunter gatherer societies to exist without a large population collapse first.
Now to your point I suppose we could have a society without money; yet I think there is some freedom in currency even if everyone gets a UBI. It allows two random strangers to come together and have one person buy something without having to trade an item that the other person wants, then the seller can go buy something they want.
Without currency we would have to have a somewhat complex trading system, which inevitably would see certain items of rarity never traded, or traded for so much surplus goods that a new ironically materialistic moneyed class would develop. It would make for an interesting book, but I think so long as people have varied interests and desires, and create creative works, money is a useful thing.
Overall I agree with you but I was more focused currency in regards to lending money… not a lack of currency as a whole.
You don’t have to go far back in history to find interest rates on lending money regarded as criminal behaviour.
Without money, money is reinvented. For practicality reasons you want a fungible means of exchange that also lasts. Being small, portable, and not spoiling is also desirable.
That means precious metals or vouchers for something. If you standardize these, you end up with money again.
Without a standardized currency, you end up with a bunch of parallel currencies. That means there will be businesses, who only deal with exchanging one form of currency for another. They could even give out their own vouchers.
Now, the state also wants to collect taxes. Collecting a bunch of different vouchers and coins is a headache. So the state issues their own vouchers, which you have to use to pay taxes. Then we are back where we started.
An interesting approach to money would be, if money had an expiration date. So you have to spend it, or lose it. That keeps it in circulation, leading to more economic activity. Inflation serves this purpose as well.
That’d just lead into investment into non-monetary things. For example, buying precious metals or bonds or stocks or property and selling them as needed.
To actually fix problems with wealth disparity, you need a wealth or property tax.
Yeah, it turns out that a system that rewards people for simply having possession of something leads to behaviors that are harmful for society.
The problem isn’t landlords, that’s just the group that most people interact with directly. The problem is that our rules (primarily taxes) are setup to reward that behavior and to add burden to people who actually do work for their income.
If you’re a billionaire you can get your effective tax rate to single digits or zero. If you work for a living you pay way more taxes proportional to your income.
Getting a paycheck automatically means that someone has more money before a product, or service is delivered. So I’m gonna stretch this a little… If we like jobs that pay money then we gotta live with rich assholes. But if we want no rich assholes and truly everyone’s time is worth exactly the same amount, then we need something other than capitalism. We need socialism. But how do we prevent kings or rich politicians in either scenario? Tax them in capitalism for one. In socialism we just downright make that illegal.
Instead of a rich asshole, you can have worker owned cooperatives and such.
That’s just objectively not the case. Some people are able to provide more essential or better quality services and labor than others. There are also more and less enjoyable activities.
Everyone’s time can be worth the same amount for the same activity at the same quality level.
You will always have people in more powerful positions and some will take advantage of it. What you can do is rotate people with term limits and such. However that can also have downsides in effectiveness and efficiency.
You can also impose limits on how much stuff a person can own. There are ways to circumvent this with non profit NGOs and such.
Socialist economies also need taxes to pay for infrastructure and the operations of the state.
This is basically where not even I believe in myself.
Cooperatives… A few billion of us get together to build a rocket…never gonna happen. A few of us build a power plant…yeah right! Never gonna happen.
What about life? My life, how much is my life worth? Is it worth more than yours or less? Divided into life/second, if I’m worth the same as you are, then I should get paid the same as you no matter what I do… I could be a painter or a seamstress or a cook or a bricklayer. I should be worth the same. Even a bum who wants nothing to do with anyone should be worth the same as the most smartest person to ever live. Its a life. You don’t get to be worth more by being smarter or making more stuff.
I would definitely not want to live in a society where my kids will be homeless even though I am the hardest working worker. If my kids are lazy I still want to ensure they live better than I did. So although I don’t like this consumerism centric capitalistic society, that socialistic society sucks.
I much rather be in a society where you can own things and give them to your kids, and have those things hold some value. I don’t want the government limiting what I can and cannot do. To some extent I think this sort of capitalism is possible, but the billionaires have got to go puff. I would love living a grand life with a big house in a sunny part of California. That’s impossible now no matter what I say or do. Meanwhile some billionaire could just buy California if he wanted to. That sort of money accumulation I’m totally against.
The fact that landlording is bad and not a profession isn’t the point.
The point is that @MithranArkanere@lemmy.world’s argument failed to convincingly argue that because it was logically fallacious:
https://en.wikipedia.org/wiki/Fallacy_of_division
In other words, the fact that thing A would “destroy of the economy if everyone did it” is an emergent property of everyone doing it, which doesn’t apply to any single entity doing thing A.
Yes yes. Many people fail to accept hyperbole. You don’t need to explain that you don’t either.
That guy said what I was pointing out. Also, it’s not a hyperbole, it would absolutely destroy the economy if everyone did the same thing regardless of what that thing is. Even if everyone decided eating chicken would be the only protein that we eat would destroy the economy. Which is why I added my edit. It’s not just about a profession, but anything, literally anything done in unison by every other human would wreck an economy.
Are you’re saying that if an economy has an increse the concentration of farming activity then economic ouput will deteriorate as fast as if it were to have instead had the same increase the concentration of parasitic activity? Very interesting idea.
Maybe I’m dense but the only way I can see that working is if the parasites become super-effective livestock and can be turned into food that is either more nutrious or has a longer shelflife than the feedstock.
Huh? I’m saying if everyone dropped whatever it is they normally do and instead all do the same exact thing, it would ruin an economy. We need diversity regardless of whatever else is happening. We couldn’t survive if everyone became farmers and no one become engineers. So ultimately, it’s a pointless statement to say if everyone did anything, such as landlording, the economy would be ruined.
Tangentially related: this comment chain reminded me of the categorical imperative (the first formulation in that article)
what’s the difference between real estate management and landlording?
Real estate Management is about rent collection, property maintenance, coordination of finding new tenants, etc. There’s labor there.
Many single property landlords are also real estate management and handymen of their own properties. And that part of the situation is actual labor.
In common parlance, people will often conflate these. But I find this dilutes the harm caused by actual landlords, which are mostly large corporations that simply own property and collect income.
A landlord can pay a manager to take care of the properties they own for them.
A manager, on the other hand, cannot pay for someone else to “landlord” for them.
Landlording is about ownership, management is about labor.