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Free Markets Aren't
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Author Topic: Free Markets Aren't  (Read 19000 times)
wodan46
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« on: February 24, 2009, 15:33:15 EST »

Current, you've indicated several times that just as you think that there is no need for anti-smoking regulation in Pubs, you think that there is no need for safety regulation in Pubs either, though in either case they might be obligated to put up warnings.  You claim that this is because that if people want to go to non-smoking or safe Pubs, Pubs which offer those services will spring up, and become more popular, and soon the non-safe Pubs would go out of existence.  This is the vaunted free market force in action.

However, such has no basis in reality whatsoever.  You do realize that?  People and companies alike have a strong tendency towards the status quo, and are uneasy about making changes.  Things like fire escapes and other safety measures cost money, as such, Companies will not want to pursue them, and will actively discourage people from wanting them by downplaying the threats whenever possible.  People are unlikely to realize that better options are possible, and thus not pursue them at all.

Take something like the Seat Belt.  Car companies fought tooth and nail to prevent it from being an enforced requirement.  Why?  Not because it would've cost them much money, but because it would've indicated that Cars are dangerous without them.  If Car companies had not been forced to implement Seat Belts, they would have simply continued to downplay the risks, and customers would have had to deal with it.

See, you think that in a Free Market, consumers have influence and power, while in a Social Democracy, those same people do not.  In actuality, its the reverse.  Companies are in a position of power, and have no reason to cater to the consumer's wishes.  Take Health Insurance.  If a consumer abandons a Health Insurance company, no other is likely to take them.  If a Health Insurance company plays nice and doesn't gouge people, it will be out-competed and be driven out of business.  In short, those that cater to the public lose, those that cater to themselves win.

In the mean time, for the Social Democracy, the power is always in the hands of the voter.  They suffer no consequences for defying the Government, in fact doing so is liable to replace it with one more amenable to their wishes.  The same is not true for dealing companies, where your abstaining of their services is often hurtful, doubly so if you actually work for them.
« Last Edit: February 24, 2009, 15:39:38 EST by wodan46 » Logged

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jerseycajun
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« Reply #1 on: February 24, 2009, 20:53:40 EST »

Aren't we still discussing these very same issues and in fact these very same points in something like five other threads?

Is your strategy to spread out the responses to the point that we'll get sick of trying to keep up with multiple threads and just quit?

At least find an article or political news article we can discuss.  Some point of reference in the real world that we haven't discussed yet, to keep it fresh - before we dip inevitably into the pool of political science theory.
« Last Edit: February 24, 2009, 20:55:31 EST by jerseycajun » Logged

"If the natural tendencies of mankind are so bad that it is not safe to permit people to be free, how is it that the tendencies of these organizers are always good? Do not the legislators and their appointed agents also belong to the human race? Or do they believe that they themselves are made of a finer clay than the rest of mankind?" — Frederic Bastiat - from The Law

"Government is not reason; it is not eloquent; it is force. Like fire, it is a dangerous servant and a fearful master."  -  George Washington

"Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all. We disapprove of state education. Then the socialists say that we are opposed to any education. We object to a state religion. Then the socialists say that we want no religion at all." - Frederic Bastiat - The Law
wodan46
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« Reply #2 on: February 24, 2009, 21:58:15 EST »

Aren't we still discussing these very same issues and in fact these very same points in something like five other threads?

Is your strategy to spread out the responses to the point that we'll get sick of trying to keep up with multiple threads and just quit?
No, I find the incredibly long and dense threads to be painful to reply to, and am trying to split them into bite size topics, rather than try, and fail, to cover many different issues at once.

At least find an article or political news article we can discuss.  Some point of reference in the real world that we haven't discussed yet, to keep it fresh - before we dip inevitably into the pool of political science theory.
Do I need to?  The economics you advocate is based on a flawed understanding of human behavior, and a flawed understanding of human society.  Central to this is the assumption that free market forces will provide the safeties that people want if government stops forcing it to.  More simply, you assume that the free market will lead to a race for the top.  But while that may be true in some cases, most commonly it becomes a race to the bottom.
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Current
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« Reply #3 on: February 25, 2009, 08:34:46 EST »

Current, you've indicated several times that just as you think that there is no need for anti-smoking regulation in Pubs, you think that there is no need for safety regulation in Pubs either, though in either case they might be obligated to put up warnings.  You claim that this is because that if people want to go to non-smoking or safe Pubs, Pubs which offer those services will spring up, and become more popular, and soon the non-safe Pubs would go out of existence.  This is the vaunted free market force in action.
Yes.

However, such has no basis in reality whatsoever.  You do realize that?  People and companies alike have a strong tendency towards the status quo, and are uneasy about making changes.  Things like fire escapes and other safety measures cost money, as such, Companies will not want to pursue them, and will actively discourage people from wanting them by downplaying the threats whenever possible.  People are unlikely to realize that better options are possible, and thus not pursue them at all.
Certainly these things do not happen overnight.  Businesses will try to downplay the risks of their products.  Consumers do not always believe what businesses tell them though.

Take something like the Seat Belt.  Car companies fought tooth and nail to prevent it from being an enforced requirement.  Why?  Not because it would've cost them much money, but because it would've indicated that Cars are dangerous without them.  If Car companies had not been forced to implement Seat Belts, they would have simply continued to downplay the risks, and customers would have had to deal with it.
I'm sure many would have continued to downplay the risks yes.  A business that adopts seat belts though can advertise them and point out the protection they afford.  This is what Saab and Volvo did in the 1960s in Europe.

Customers can choose whether to examine the products they buy carefully or not.

If people are careless and don't think about the purchases they make there is no reason to be sad if those purchases end up harming them.

See, you think that in a Free Market, consumers have influence and power, while in a Social Democracy, those same people do not.  In actuality, its the reverse.  Companies are in a position of power, and have no reason to cater to the consumer's wishes.
What about profit?  Are there not many situations where profit gives businesses reasons to improve their products.  I know there are where I work.

Also, you fail to really compare the situation to its alternative.  Governments too have many reasons to downplay risks, and they often have.  Just as the "profit motive" often gives reasons to downplay risks, the "vote motive" does the same.  (It is also true that both parties have reasons to play up risks for example organic food companies play up the risks of ordinary food and the US government constantly played up the risks of the USSR in the 1950s and 60s).

Take Health Insurance.  If a consumer abandons a Health Insurance company, no other is likely to take them.  If a Health Insurance company plays nice and doesn't gouge people, it will be out-competed and be driven out of business.  In short, those that cater to the public lose, those that cater to themselves win.
You have said this many time, but never explained why.  I've discussed it with you many times but you have never being able to produce a line of reasoning behind it.

In the mean time, for the Social Democracy, the power is always in the hands of the voter.  They suffer no consequences for defying the Government, in fact doing so is liable to replace it with one more amenable to their wishes.  The same is not true for dealing companies, where your abstaining of their services is often hurtful, doubly so if you actually work for them.
You're belief in Democracy is touching, but not reasonable.  Certainly the voter has power, but only a tiny, tiny portion of it.  So little they have no reason to use it wisely.

The individual voter is not the same as the electorate.  Defying government can be very dangerous for an individual voter in a situation of mob rule.

When dealing with a company you do not necessarily have to "abstain" from the services.  You can pick another supplier.

Something I think that you fail to do in our discussions is look at things from your own point of view.  You are a member of the middle class, the intellectual middle class I'd say.  You aren't really an "ordinary" person or one of "the masses" or "the majority".  Perhaps that ought to give you cause to consider if anyone really is.

If you want to learn something about Democracy read about Public Choice.
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Ihlosi
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« Reply #4 on: February 25, 2009, 09:38:34 EST »

I'm sure many would have continued to downplay the risks yes.  A business that adopts seat belts though can advertise them and point out the protection they afford.  This is what Saab and Volvo did in the 1960s in Europe.

Customers can choose whether to examine the products they buy carefully or not.

That would require near-perfect information on the side of the customer. Which, even without any interference by the businesses, is an untenable premise. Taking marketing into account, it a downright ridiculous premise.

What about profit?  Are there not many situations where profit gives businesses reasons to improve their products.  I know there are where I work.

There are situations where profit gives businesses reasons to improve their products, but also situations where making inferior products results in higher profits, at least temporarily (and that's all that counts for the manager making the decision). As a recent example, see the "big three".

Also, you fail to really compare the situation to its alternative.  Governments too have many reasons to downplay risks, and they often have.  Just as the "profit motive" often gives reasons to downplay risks, the "vote motive" does the same.  (It is also true that both parties have reasons to play up risks for example organic food companies play up the risks of ordinary food and the US government constantly played up the risks of the USSR in the 1950s and 60s).

A good point. However, in government, you usually have an opposition that has an interest in not playing that game, while whole industries depend on basically every single corporation downplaying the risk of their product, even without the need of any collusion since each business will arrive at that decision independently. See the tobacco industry, for example. If they hadn't been slapped down hard repeatedly, they'd still be trumpeting that smoking does not affect your health adversely, or is beneficial, even. No tobacco company by itself would have any interest in actually saying the truth.

Take Health Insurance.  If a consumer abandons a Health Insurance company, no other is likely to take them.  If a Health Insurance company plays nice and doesn't gouge people, it will be out-competed and be driven out of business.  In short, those that cater to the public lose, those that cater to themselves win.
You have said this many time, but never explained why.  I've discussed it with you many times but you have never being able to produce a line of reasoning behind it.

Here's a very simple example: Health insurance company A tries to spread risk among its customers and to offer insurance to pretty much everyone without asking detailed questions. Health insurance company B tries to optimize their profits by cherry-picking whom they offer insurance to. Of course, company B can offer lower prices to its customers and basically siphon away any customers of company A that meet their criteria. The business model of company A ceases to work, because they end up being stuck with risky customers only. Ultimately, their choices are either to adapt their prices to the increased risks (which will make them lose customers as many won't be able to afford the insurance anymore, and possibly drive company A out of business altogether), or adapt the business model of company B and start cherry-picking their customers, or start hemorrhaging money and eventually go out of business. Any halfway sensible manager will pick the second option, because it's the best bet for future profitability of the company.

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You're belief in Democracy is touching, but not reasonable.  Certainly the voter has power, but only a tiny, tiny portion of it.  So little they have no reason to use it wisely.

Over the decisions of a company, you only have as much power as you own stock.

Quote
The individual voter is not the same as the electorate.  Defying government can be very dangerous for an individual voter in a situation of mob rule.

That's why elections are supposed to be secret.

Quote
When dealing with a company you do not necessarily have to "abstain" from the services.  You can pick another supplier.

If one exists that also wants to do business with you. That's two conditions that aren't always fulfilled.
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wodan46
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« Reply #5 on: February 25, 2009, 13:18:16 EST »

Certainly these things do not happen overnight.  Businesses will try to downplay the risks of their products.  Consumers do not always believe what businesses tell them though.

I'm sure many would have continued to downplay the risks yes.  A business that adopts seat belts though can advertise them and point out the protection they afford.  This is what Saab and Volvo did in the 1960s in Europe.

Customers can choose whether to examine the products they buy carefully or not.
I thought you were against the French Model of Economics.  Why, on earth, would you presume that the average person has the ability to see through deception conducted by a large scale company, especially when all companies have reasons to consistently deceive whenever possible (see advertising).

If people are careless and don't think about the purchases they make there is no reason to be sad if those purchases end up harming them.
So, basically, you are saying that it is ok for a company to deceive people into buying a product which will destroy their negative rights when they didn't realize it, because if you're stupid, you don't deserve liberty?  A level of stupidity that is true for well over 90% of the world population, given the degree of deception and danger present even in a system which punishes for such mis-deeds.

What about profit?  Are there not many situations where profit gives businesses reasons to improve their products.  I know there are where I work.
Catering to the customer's wishes is antithetical to obtaining profit quite often as well.  Rather than cater to the customer's wishes and make their product a cheaper sell or more expensive to make, which costs them money, they simply deceive the customer into thinking that they are providing it, or convince the customer that they never wanted that wish at all, or that it would be unfeasible.  As for the companies that do cater to the customer's wishes, they are indistinguishable from those who merely pretend to unless you are very smart, and as such will attract no more customers even as they make less profits.

Also, you fail to really compare the situation to its alternative.  Governments too have many reasons to downplay risks, and they often have.  Just as the "profit motive" often gives reasons to downplay risks, the "vote motive" does the same.  (It is also true that both parties have reasons to play up risks for example organic food companies play up the risks of ordinary food and the US government constantly played up the risks of the USSR in the 1950s and 60s).
So?  I never said they did not.  The difference is that the government can be punished for being bad, and corporations can't, unless you have a government to punish them handy.  They will still commit mis-deeds, but when they are discovered, they will be punished.

Also, see what Ihlosi said.

You have said this many time, but never explained why.  I've discussed it with you many times but you have never being able to produce a line of reasoning behind it.
It is incredibly obvious and self-explanatory.  Ihlosi covers it well.  The only way you can make a profit via Health Insurance is if you screw people over.  Government, in the mean time, can take the loss in return for not screwing the people, whereupon their increased productivity will pay the Government back for their losses and then some.  Only Government could make a profit out of helping people via Health Insurance.

You're belief in Democracy is touching, but not reasonable.  Certainly the voter has power, but only a tiny, tiny portion of it.  So little they have no reason to use it wisely.
Voters have tremendous power, and every reason to use it wisely.

The individual voter is not the same as the electorate.  Defying government can be very dangerous for an individual voter in a situation of mob rule.
Are you unfamiliar with how voting processes work?  There is a reason why voting is concealed.

When dealing with a company you do not necessarily have to "abstain" from the services.  You can pick another supplier.
All suppliers have the same motivation, and will thus work in concert to screw you.  Those who break from the line will gain nothing but large losses, because no one will be able to distinguish the real line breaker from the rest, who are constantly pretending to break the line.  Plus anyways, companies are extremely conservative in nature, and are unlikely to break from status quo even if it would make them a profit, because they are unwilling to take risks, because those who do take risks are often screwed.


Something I think that you fail to do in our discussions is look at things from your own point of view.  You are a member of the middle class, the intellectual middle class I'd say.  You aren't really an "ordinary" person or one of "the masses" or "the majority".  Perhaps that ought to give you cause to consider if anyone really is.
Yes, I'm 2 standard deviations above them IQ wise.  That means that to me, "the masses" basically look like Forrest Gump with a bad attitude.  Yes, they are really going to be able to form an nice and coordinated community with no outside pressure, as well as outwitting billion dollar corporations regularly.
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« Reply #6 on: February 25, 2009, 15:14:45 EST »

Certainly these things do not happen overnight.  Businesses will try to downplay the risks of their products.  Consumers do not always believe what businesses tell them though.

I'm sure many would have continued to downplay the risks yes.  A business that adopts seat belts though can advertise them and point out the protection they afford.  This is what Saab and Volvo did in the 1960s in Europe.

Customers can choose whether to examine the products they buy carefully or not.
I thought you were against the French Model of Economics.
If you mean French rationality, then certainly I'm against that.  But that is more a flaw in how people conceive of the thought process.

Why, on earth, would you presume that the average person has the ability to see through deception conducted by a large scale company, especially when all companies have reasons to consistently deceive whenever possible (see advertising).
It is hardly rocket science.  I think even young children understand that businesses do not tell the full truth when it is not in their interest.  That gives them a clue that they should investigate these sorts of matter for themselves, which is what people do.

Those who don't investigate buying a car before buying one can't be helped.

The situation is hardly any different for politics.  The only major difference is that outright deception in business is a criminal offence,  lying in political campaigns is not.

If people are careless and don't think about the purchases they make there is no reason to be sad if those purchases end up harming them.
So, basically, you are saying that it is ok for a company to deceive people into buying a product which will destroy their negative rights
No.  Not mentioning a risk is not the same sort of thing as deception, that was what we were discussing. 

when they didn't realize it, because if you're stupid, you don't deserve liberty?  A level of stupidity that is true for well over 90% of the world population, given the degree of deception and danger present even in a system which punishes for such mis-deeds.
What exactly is it that 90% of the population are not able to understand?

What about profit?  Are there not many situations where profit gives businesses reasons to improve their products.  I know there are where I work.
Catering to the customer's wishes is antithetical to obtaining profit quite often as well.  Rather than cater to the customer's wishes and make their product a cheaper sell or more expensive to make, which costs them money, they simply deceive the customer into thinking that they are providing it, or convince the customer that they never wanted that wish at all, or that it would be unfeasible.
Certainly.

As for the companies that do cater to the customer's wishes, they are indistinguishable from those who merely pretend to unless you are very smart, and as such will attract no more customers even as they make less profits.
I wouldn't say they are indistinguishable.  In most cases it is a matter of simple research.

Also, you fail to really compare the situation to its alternative.  Governments too have many reasons to downplay risks, and they often have.  Just as the "profit motive" often gives reasons to downplay risks, the "vote motive" does the same.  (It is also true that both parties have reasons to play up risks for example organic food companies play up the risks of ordinary food and the US government constantly played up the risks of the USSR in the 1950s and 60s).
So?  I never said they did not.  The difference is that the government can be punished for being bad, and corporations can't, unless you have a government to punish them handy.  They will still commit mis-deeds, but when they are discovered, they will be punished.
I don't agree.  If a government misbehave the electorate may throw them out of office.  If there is an alternative party that could govern better that is.

If a business sells sub-standard products then any individual customer may go to an alternative supplier.  If they can find one that is.

The major difference here is that the electoral decision is a group one not an individual one.  There are many differences between the two.  A book on Public Choice will inform you of them.

You have said this many time, but never explained why.  I've discussed it with you many times but you have never being able to produce a line of reasoning behind it.
It is incredibly obvious and self-explanatory.  Ihlosi covers it well.  The only way you can make a profit via Health Insurance is if you screw people over.  Government, in the mean time, can take the loss in return for not screwing the people, whereupon their increased productivity will pay the Government back for their losses and then some.  Only Government could make a profit out of helping people via Health Insurance.
I'll reply to Ihlosi on the topic.  How do you explain those health insurance companies that make money by "helping people via Health Insurance"?  Or are we supposed to believe that they are all screwing their customers?  Where is the proof?

You're belief in Democracy is touching, but not reasonable.  Certainly the voter has power, but only a tiny, tiny portion of it.  So little they have no reason to use it wisely.
Voters have tremendous power, and every reason to use it wisely.
Well if you think that then explain why.

The individual voter is not the same as the electorate.  Defying government can be very dangerous for an individual voter in a situation of mob rule.
Are you unfamiliar with how voting processes work?  There is a reason why voting is concealed.
Defying the government by a vote is perfectly safe.  What I mean is that defying government otherwise is not always.

When dealing with a company you do not necessarily have to "abstain" from the services.  You can pick another supplier.
All suppliers have the same motivation, and will thus work in concert to screw you.  Those who break from the line will gain nothing but large losses, because no one will be able to distinguish the real line breaker from the rest, who are constantly pretending to break the line.  Plus anyways, companies are extremely conservative in nature, and are unlikely to break from status quo even if it would make them a profit, because they are unwilling to take risks, because those who do take risks are often screwed.
I agree with you that companies are often extremely conservative in nature.  That does not mean though that they don't compete.  The company I work for could be described as "conservative".  However, it is still working on producing product that deliver more performance for a lower price to sell next year, as all computer companies do.  To put things another way, conservatism doesn't necessarily mean the lack of competition.

Also, it is not true that "Those who break from the line will gain nothing but large losses".  The advantage in breaking from the line is obvious, if customers can be made to recognize a better product then a business can make more money.  Now, I accept your point to some extent that customers may not be able to recognize a good product from one pretending to be good in some cases.  However, the customer has a good motivation to do this since it is in his or her direct interest to make the decision well.

Something I think that you fail to do in our discussions is look at things from your own point of view.  You are a member of the middle class, the intellectual middle class I'd say.  You aren't really an "ordinary" person or one of "the masses" or "the majority".  Perhaps that ought to give you cause to consider if anyone really is.
Yes, I'm 2 standard deviations above them IQ wise.  That means that to me, "the masses" basically look like Forrest Gump with a bad attitude.  Yes, they are really going to be able to form an nice and coordinated community with no outside pressure, as well as outwitting billion dollar corporations regularly.
I thought when I wrote the comment above that I would get some stick for being a stuck-up Englishman, I see I got that wrong.  I don't have such a negative impression of "the masses" as you do.  But that isn't really the issue,  I don't think you understand my point.

Within our countries are many small communities.  Each of us inhabit many of them.  I am an expat in Ireland for example, I'm also an employee, a taxpayer, an engineer, a middle class person, a car driver and numerous other things.  You are similarly a member of many groups such as these, some large and some small.

You wrote in your previous post:
Quote from: wodan46
In the mean time, for the Social Democracy, the power is always in the hands of the voter.  They suffer no consequences for defying the Government, in fact doing so is liable to replace it with one more amenable to their wishes.
You have written similar sorts of thing often.

The mistake you make is conflating the voter with the electorate.  A single voter is not a majority.  Rather these sorts of electoral decisions are made by "the masses".  A government is elected by a majority, we'll assume for now they do what that majority want.

Now, look at the various groups to which a person belongs.  Some of these are not typical of the majority.  So, even taking a very optimistic view of democracy the problem should be clear.  An electorate may choose a path which is detrimental to some of the sub groups of society.  This is acceptable if it is a decision an electorate must take.  But we must question vigourously if their is no need to make a particular decision, if free individuals could make the decision themselves.

Think about your own social subset:
* Student
* Middle class (I presume)
* Thinks he's clever and probably is
* Wants to do some good

Now, for you to be able to be useful to yourself or others you must have a degree of liberty in what you do.  You do not want interference from the government who will likely not understand your particular community or ecosystem, your part of the world.  The same sort of thing is true of most other subsets of society.

I don't really disagree with you that "the masses" are "a bit thick" as some have said.  But I fail to see what that has to do with anything.
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Ihlosi
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« Reply #7 on: February 25, 2009, 16:33:19 EST »

I'll reply to Ihlosi on the topic.  How do you explain those health insurance companies that make money by "helping people via Health Insurance"?  Or are we supposed to believe that they are all screwing their customers?  Where is the proof?

The proof is the "little" questionnaire you get when applying for health insurance. If they find the wrong things on it, oh boy will they try to screw you. If they want to do business with you at all, that is.

And then of course there's all the horror stories you can find in the US, where it's not all that unlikely that you'll have to take your insurance company to court over your coverage. Good luck doing that when you're sick in the first place and have to deal with five figure medical bills in addition to paying for your lawyer. Luckily, this practice doesn't seem to be commonplace in Europe (quite possibly due to regulations), but the US is a good example of how bad things can and will get.
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wodan46
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« Reply #8 on: February 25, 2009, 16:44:36 EST »

If you mean French rationality, then certainly I'm against that.  But that is more a flaw in how people conceive of the thought process.
So you admit you were wrong, and your argument was successfully disproven then?  Because I established that your argument required people to adhere to French rationality in order to work, you failed to dispute that link, and you admit that French rationality is wrong.

It is hardly rocket science.  I think even young children understand that businesses do not tell the full truth when it is not in their interest.  That gives them a clue that they should investigate these sorts of matter for themselves, which is what people do.

Those who don't investigate buying a car before buying one can't be helped.
What a load of crap.  You honestly think that people have the ability to read and comprehend all that terms of service stuff, which requires them to carefully read through it all, as well as a detailed knowledge of both legal rules and the conventions of the industry?  You really think that people can handle that kind of deception?  Most people realize that organizations try to trick them, but that doesn't mean they can see the trickery.  So how is the good company that offers the deal that caters to people's needs going to be spotted from all the ones that conceal it at great length.

The situation is hardly any different for politics.  The only major difference is that outright deception in business is a criminal offence,  lying in political campaigns is not.
The difference is that corporations can get away with outright deception, while politicians cannot, at least to the same degree.  Corporations rarely have to commit illegal deception to get what they want.

No.  Not mentioning a risk is not the same sort of thing as deception, that was what we were discussing. 
WTF?  Not mentioning a risk (or a hidden cost) is exactly the kind of deception that companies regularly and consistently commit, and they are punished solely because government regulators call them on it after being informed by the general public.

For example, let's say a bar was built without a fire escape and sufficient exits and the like, but concealed the danger through byzantine legal writing.  Do they suddenly not become guilty because anyone who happened to have 140 IQ points could recognize that the legal writing indicated the place was dangerous?

What exactly is it that 90% of the population are not able to understand?
Long legal contracts and fine print.  Which, if you look, is tied to basically all products that we take for granted every day.  While people regularly get screwed because of that, it is only because of the assurances of the government that people's lives aren't endangered by products unexpectedly.

The only reason you can know that your sofa cushion isn't full of dead raccoons and your toothpaste doesn't contain traces of rat poison is because of the government bureaucracy.  If corporations had their way, they would (and did) happily sell all sorts of fake and dangerous products, knowing that because of legal loopholes, they'd never get called on it, and people wouldn't be able to distinguish them from those who sell real and safe products.

Catering to the customer's wishes is antithetical to obtaining profit quite often as well.  Rather than cater to the customer's wishes and make their product a cheaper sell or more expensive to make, which costs them money, they simply deceive the customer into thinking that they are providing it, or convince the customer that they never wanted that wish at all, or that it would be unfeasible.
Certainly.
So you concede that I am right then?  That corporations are NOT compelled to cater to the customer's wishes, which is exactly what you insisted the free market would force them to do?

I wouldn't say they are indistinguishable.  In most cases it is a matter of simple research.
I ask you the same thing you did of me.  We are not average people.  To an average person, distinguishing would require more than simple research, and would have to be done for every last product, and that's in an environment where there is lots of government regulation.  A bunch of people, many of them of above average smarts, got hit, easily, by a ponzi scheme over the course of decades.  You honestly expect people to deal with deception that is much less blatant and extreme?

I don't agree.  If a government misbehave the electorate may throw them out of office.  If there is an alternative party that could govern better that is.

If a business sells sub-standard products then any individual customer may go to an alternative supplier.  If they can find one that is.
There has always been an alternative party.  There is not usually an alternative supplier, especially when a person first has to realize that they are receiving sub-standard products, then successfully identify a company which does not.

The major difference here is that the electoral decision is a group one not an individual one.  There are many differences between the two.  A book on Public Choice will inform you of them.
What difference?

How do you explain those health insurance companies that make money by "helping people via Health Insurance"? 
Where are they?  Prove it.

Or are we supposed to believe that they are all screwing their customers?
They all are.  But customers have no choice, they just get to deal with it.

Where is the proof?
Um, everywhere?  Just look at how often they deny claims, usually using all sorts of legal loopholes.  Or the times that people have testified that they were paid based on their ability to deny people claims, screwing them?  The question is where do you NOT find evidence.

Well if you think that then explain why.
They get to elect the President, the Senators, the Representatives, the State Legislatures, and the Local Legislatures.  Everyone has the power to change who gets elected.

Defying the government by a vote is perfectly safe.  What I mean is that defying government otherwise is not always.
How many people have died in the US for opposing government?  How many have been jailed?  Excluding riots that got out of hand, I'd say a dozen for the first, and maybe a hundred for the second, out of the 100s of millions of people in this country.

I agree with you that companies are often extremely conservative in nature.  That does not mean though that they don't compete.  The company I work for could be described as "conservative".  However, it is still working on producing product that deliver more performance for a lower price to sell next year, as all computer companies do.  To put things another way, conservatism doesn't necessarily mean the lack of competition.

Also, it is not true that "Those who break from the line will gain nothing but large losses".  The advantage in breaking from the line is obvious, if customers can be made to recognize a better product then a business can make more money.  Now, I accept your point to some extent that customers may not be able to recognize a good product from one pretending to be good in some cases.  However, the customer has a good motivation to do this since it is in his or her direct interest to make the decision well.
Once again, the customer gets magic knowledge powers when handling corporations that seem to fade to nothing when dealing with filling out a ballot.  Also, of course companies are competitive.  Much of that competition is indeed beneficial.  However, that competition is not done in the interests of the public, and many times that competition becomes not a race to the top but the bottom.


I thought when I wrote the comment above that I would get some stick for being a stuck-up Englishman, I see I got that wrong.  I don't have such a negative impression of "the masses" as you do.
Then perhaps you don't realize why they aren't able to handle the free market.

Keep in mind that my perspective of myself is that of a scatter-brained, clueless, and ignorant person blundering through life.  Of course, that means that when I apply those same standards to the public, they look like a bunch of mewling retard babies.  If I was really so smart, I wouldn't have played videogames until I strained both my flabby nerd arms to the point that I could barely use them to get by day to day activities, even though I knew that I was straining every time I played.  I'd also be reading the book I need to read for the midterm exam tomorrow rather than arguing with you.  I'm supposed to be the cream of society with a record like that?

Within our countries are many small communities.  Each of us inhabit many of them.  I am an expat in Ireland for example, I'm also an employee, a taxpayer, an engineer, a middle class person, a car driver and numerous other things.  You are similarly a member of many groups such as these, some large and some small.
So?

Now, for you to be able to be useful to yourself or others you must have a degree of liberty in what you do.
I must also be restricted from doing foolish things as a product of my limited knowledge set, things which have no real need to occur.   If I hadn't been restricted, I'd probably be dead.  Which is pretty bad for my liberties.

You do not want interference from the government who will likely not understand your particular community or ecosystem, your part of the world.
No, government has played an invaluable role in keeping it functional, and if I exert proper effort, it could do an even better job while shoring up its mistakes.  Also, how can the government interfere?  The government is us.

* Thinks he's clever and probably is
Huh.  I was treated as slow, dumb, and scatterbrained.  The government recognized that this was merely a learning disability brought by ADHD and mild Autism.  Thanks to their support, I was able to realize my potential, and now go to one of the best colleges in the country.  Without the intervention of government(or the existence of public education), I would not have gotten where I am today, and I was one of the luckier ones, who had a supportive middle-upper class family.

Our education system is rather cash-strapped nowadays.  I wonder how many people like me were simply left to rot, their potential never realized.  I wonder how many more will be left to rot if government were castrated like you wanted.

I don't really disagree with you that "the masses" are "a bit thick" as some have said.  But I fail to see what that has to do with anything.
Because the whole of your belief system is based around the requirement that they be geniuses, when they are actually morons.
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The plural of "anecdote" is "anecdotes". Not "data".
wodan46
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« Reply #9 on: February 25, 2009, 16:48:52 EST »

The proof is the "little" questionnaire you get when applying for health insurance. If they find the wrong things on it, oh boy will they try to screw you. If they want to do business with you at all, that is.

And then of course there's all the horror stories you can find in the US, where it's not all that unlikely that you'll have to take your insurance company to court over your coverage. Good luck doing that when you're sick in the first place and have to deal with five figure medical bills in addition to paying for your lawyer. Luckily, this practice doesn't seem to be commonplace in Europe (quite possibly due to regulations), but the US is a good example of how bad things can and will get.
Doesn't happen in Europe because they have universal healthcare.  The only way you get screwed there is if you get an expensive, chronic, and lethality magnifying disorder, whereupon the government doesn't feel like paying to keep you alive and miserable for a few more years, such would represent a huge sap on resources for minimal gain in health, they'd rather help others with that money, you can pay for that yourself.  In the US, you'd be paying for it regardless.
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The plural of "anecdote" is "anecdotes". Not "data".
Ihlosi
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« Reply #10 on: February 25, 2009, 16:51:10 EST »

The only reason you can know that your sofa cushion isn't full of dead raccoons and your toothpaste doesn't contain traces of rat poison is because of the government bureaucracy.

Not rat poison, _radium_. It's what makes your teeth shine extra white and glow in the dark! Wink

http://en.wikipedia.org/wiki/Radioactive_quackery

Oh, and I bet while we're at it we can also put the stuff in paint, laundry detergent and whatnot. Wink


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Ihlosi
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« Reply #11 on: February 25, 2009, 16:55:44 EST »

Doesn't happen in Europe because they have universal healthcare.

Well, that or some form of universal health insurance. In some countries, you can opt out of that an go for private insurance, which works pretty much like in the US, just a bit nicer (not so much trouble with the coverage, and they usually cover the full costs, not just 80%). However, the companies cherry-pick who they insure, and jack up the rates astronomically for anyone they don't like, or don't offer coverage at all.

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Medivh
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« Reply #12 on: February 25, 2009, 19:36:56 EST »

Take something like the Seat Belt.  Car companies fought tooth and nail to prevent it from being an enforced requirement.  Why?  Not because it would've cost them much money, but because it would've indicated that Cars are dangerous without them.  If Car companies had not been forced to implement Seat Belts, they would have simply continued to downplay the risks, and customers would have had to deal with it.
I'm sure many would have continued to downplay the risks yes.  A business that adopts seat belts though can advertise them and point out the protection they afford.  This is what Saab and Volvo did in the 1960s in Europe.

Interesting fact about Volvo:
Volvo has a reputation in Australia for safety. I don't know about overseas, but in Australia, if you're paranoid about crashing your car it's likely that you're going to buy a Volvo.

Why?

Because back in the day, safety standards were introduced, meaning that car manufacturers had to make sure that the car wouldn't dump the engine block on the driver's lap in a crash. Volvo, seeing that they may as well get some PR out of this, and launched an ad campaign saying "Look! We're so safe, our cars come with x, y and z!"

Other manufacturers didn't bother, thinking that the Australian public would be more interested in acceleration, and thinking that adding safety features would decrease this.

To this day, Volvo advertises based on safety features, where others advertise based on "cool factor". To this day, the safety features very rarely differ between manufacturers.

The free market doesn't work when customers are expected to find this kind of thing out for themselves.

Take Health Insurance.  If a consumer abandons a Health Insurance company, no other is likely to take them.  If a Health Insurance company plays nice and doesn't gouge people, it will be out-competed and be driven out of business.  In short, those that cater to the public lose, those that cater to themselves win.
You have said this many time, but never explained why.  I've discussed it with you many times but you have never being able to produce a line of reasoning behind it.

It's produced by the conditions of the market.

1) Health insurers refuse to insure for pre-existing conditions. Or at least those who do insure for such conditions are incredibly expensive.
2) Health insurers gain the most profit when they take in as many premiums as they can, while paying the fewest claims that they can get away with
3) Knowledge of health insurers who don't pay claims is not wide spread, nor is it easy to find out; you have to be sick to find out if they'll pay your claim
4) Point 2 implies that people should change insurers until they find one more amenable
5) Point 1 implies that they wont be able to change insurers if you get sick
6) Point 3 with point 4 and 5 implies that by the time that you want to change insurers you can't

Basically, by the time you find out that you want to change insurers, you can't without paying as much as your treatment would cost anyway. This has been presented to you before, though not in such a formal format.

In the mean time, for the Social Democracy, the power is always in the hands of the voter.  They suffer no consequences for defying the Government, in fact doing so is liable to replace it with one more amenable to their wishes.  The same is not true for dealing companies, where your abstaining of their services is often hurtful, doubly so if you actually work for them.
You're belief in Democracy is touching, but not reasonable.  Certainly the voter has power, but only a tiny, tiny portion of it.  So little they have no reason to use it wisely.

The individual voter is not the same as the electorate.  Defying government can be very dangerous for an individual voter in a situation of mob rule.

Democracy isn't.

When dealing with a company you do not necessarily have to "abstain" from the services.  You can pick another supplier.

Not always. For instance, given the programs I have to work with, and the ones I want to use at home, I'm locked in to using Microsoft products. I can't choose not to, if I want to have a useful computer.

Not having a useful computer would mean no money, which would mean death. So no, that's not an option.

Something I think that you fail to do in our discussions is look at things from your own point of view.  You are a member of the middle class, the intellectual middle class I'd say.  You aren't really an "ordinary" person or one of "the masses" or "the majority".  Perhaps that ought to give you cause to consider if anyone really is.

I'm not sure what point you're trying to make here.

If you want to learn something about Democracy read about Public Choice.

I don't know about Wodan, but I will. It will be with a critical eye, though.
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And if i catch you comin' back my way
I'm gonna serve it to you
And that ain't what you want to hear
But that's what I'll do
-- "Seven Nation Army", The White Stripes

So what you're telling me is that LTV's fudge factor means more than it's independent variable?
Yes...
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« Reply #13 on: February 26, 2009, 10:31:16 EST »

I'll reply to Ihlosi on the topic.  How do you explain those health insurance companies that make money by "helping people via Health Insurance"?  Or are we supposed to believe that they are all screwing their customers?  Where is the proof?

The proof is the "little" questionnaire you get when applying for health insurance. If they find the wrong things on it, oh boy will they try to screw you. If they want to do business with you at all, that is.
How is that proof?  Health insurance companies can not be expected to accept people who are very high risks at low rates.  Obviously they have to charge high rates.

And then of course there's all the horror stories you can find in the US, where it's not all that unlikely that you'll have to take your insurance company to court over your coverage. Good luck doing that when you're sick in the first place and have to deal with five figure medical bills in addition to paying for your lawyer. Luckily, this practice doesn't seem to be commonplace in Europe (quite possibly due to regulations), but the US is a good example of how bad things can and will get.
Well, I know Michael Moore made a film about this, but I'm not sure that makes it true.  Even if it is true all that it mainly a problem with the legal system in the US.

Things are not perfect here in Europe, are they?
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Ihlosi
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« Reply #14 on: February 26, 2009, 11:05:01 EST »

How is that proof?  Health insurance companies can not be expected to accept people who are very high risks at low rates.  Obviously they have to charge high rates.

If none of them went the cherry-picking route, they would be able to offer health insurance to a large customer base at reasonable rates. However, if only one single company starts cherry-picking, all of them have to do the same, or be eventually forced out of business. Also, in many cases, people who are considered "undesirable/high risk" have little to no opportunity to make themselves more attractive customers. That's a big difference compared to other types of insurance, where you do have much more control over the risk (possibly with some inconvenience, but nonetheless control).

And, frankly, having the price jacked up by a factor of four while at the same time excluding coverage for anything that can be remotely attributed to the pre-existing condition isn't a "high rate", it's an invitation to either contribute to their profit without receiving an adequate service (if you're stupid), or to not doing business with them (if you realize that the first option is for stupid people).

Quote
Well, I know Michael Moore made a film about this, but I'm not sure that makes it true.  Even if it is true all that it mainly a problem with the legal system in the US.

I haven't seen "Sicko". My knowledge of the situation comes from conversations with Americans and various US media. To me, it's pretty much mind-boggling how these guys get screwed by the insurance companies.

Quote
Things are not perfect here in Europe, are they?

Yes, just like "Democracy is not perfect". It's just that everything else is worse. I'm stuck with the public health insurance system (which doesn't pay for niceties like single rooms in hospitals), and they're stuck with me (due to that pesky pre-existing condition thing. I could probably save a hundred bucks per month by opting out and going for private insurance, if that wasn't the case).
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