An economics discussion.

I feel the need to preserve here a conversation on economics which took place on Facebook.  My friend Jared Nathan Garrett posted a screenshotted snippet from economics savant Alexandria Ocasio-Cortez:

And Jared’s comment was simply,

That’s not capitalism.

While most of Jared’s friends agreed, one commenter named Erin came to AOC’s defense:

ERIN: No, she’s right. This is modern capitalism. It’s also historical capitalism. Ask current and formerly colonized peoples across the world.

Which is where I came in, and the conversation proceeded:

NATHAN: Colonialism isn’t the same thing as capitalism. Capitalism is a mutually beneficial exchange between legal equals; colonialism is imposition of a dominating, governmental authority to keep the parties unequal.

ERIN: oh em gee. I had no idea colonialism was not the same thing as capitalism. Thank you so much.

That is a cute definition of capitalism you’re using there.

NATHAN: Do you have a substantive objection, or just condescending snark? Free-market capitalism is exactly that: A voluntary exchange between legal equals. If one or both of the parties is coerced, it isn’t a free market; if one of the parties is in a position where the law hampers their choice to engage in the exchange or not, they’re not legal equals.

ERIN: Oh, sorry. I thought we were working in condescension here based on your defining terms for me.

Yeah. Free-market capitalism thrives in unequal partnerships: Boss vs laborer, rich and fat vs poor and desperate, countries that have grown through intense colonialization and slave labor vs developing nations that were deliberating underdeveloped. Profit maximization necessitates labor abuses through underpaid or slave labor and environmental abuses through illegal dumping or legal shipping of hazardous materials to poor nations with weak environmental regulations (or enforcement). Because labor, environmental, and transportation costs are externalized to the public companies are able to abuse the system (through legal means (but we all know legal ≠ ethical)) and then concentrate profit growth in reducing raw materials costs through more abusive tactics.

Capitalism is a pyramid scheme.

NATHAN: If I think you’re wrong (“Capitalism = colonialism”), then I disagree. Disagreement isn’t condescension, and defining terms so that everyone uses the words to mean consistent concepts is the basis of communication.

You’re rolling a bunch of things into free-market capitalism that aren’t a part of the concept. I grow corn that I trade to my neighbor for his eggs, and we’re both better off. That’s the core of free-market capitalism, regardless of scale. The rest of the evils you cite — slave labor, illegal dumping, etc. — are no more a necessary part of free-market capitalism than spousal abuse is necessary to marriage.

ERIN: You’re looking at pen and paper definitions. Look at the system as it runs.

NATHAN: I’m defining the concept — the “ism.” You’re talking about abuses of the system; I don’t dispute that people with a lust for money and power abuse the system — ANY system, be it free-market capitalism, socialism, or anything in between. The fact that abuses often exist does not make those abuses a necessary part of the concept of capitalism, any more than the frequency of fleas on dogs makes fleas an inherent and unique part of the concept of dogness — especially when fleas are at least as likely to be on cats and rats.

ERIN: Have fun with that circular argument.

NATHAN: Via con Dios.

At which point, the conversation having become more contentious than Jared wanted, the thread was shut down.

I reproduce it here because there’s simply so much wrong — and yet not unusual — in both Erin’s argument and its presentation.

First up: The discussion was ABOUT A DEFINITION. Jared said AOC’s definition was wrong; Erin said it was right. I defined the terms, and she accused me of condescension.  (At least she didn’t explicitly accuse me of “mansplaining.”)  But words are only useful when all participants in the conversation are using them to signify the same concepts, and I couldn’t very well proceed accepting her contention that capitalism does indeed equal colonialism and is by its nature evil; you can’t argue against someone when the terms of the argument are that you accept their conclusion as a starting point.

Second, I think I was very particular in defining what I meant by free-market capitalism: participants in an exchange are free to enter into an exchange or not, and are equal legal parties. If you change the terms so that the legal status of one or more participants are changed, or that one or more parties are coerced into the deal, by definition it isn’t a free market.  Her ongoing contention that a free-market transaction is inherently unequal is thus borderline nonsensical.

That’s what I tried to convey by reducing a free-market commercial exchange to the corn-and-eggs example. I contend that if (a) this kind of voluntary exchange is the most fundamental example of free-market capitalism, and (b) this kind of voluntary exchange is free from the abuses she cites — slavery, environmental degradation, yada yada — then, logically, said abuses are not a necessary part of the concept of the free market, nor are they unique to capitalism (for example, the Soviet Union was a horrendous environmental polluter, and if you want to talk about slave labor… [shudders]).

I don’t know what she found to be “circular” in that argument.  My honest inclination is to see that claim as what Scott Adams calls a literal hallucination of one’s opponent’s argument as a coping method for cognitive dissonance, i.e., a protective measure allowing one to dismiss an argument instead of deal with it.

But one of those truisms I’ve absorbed is “A man convinced against his will / Is of the same opinion still,” which is why I tacitly agreed to end the discussion; I don’t think Jared needed to delete it at that point, as I certainly wasn’t going to continue from there without a further input of substantive content.