Two at The Business. The income gap and burning salt water.
Timmy Elsewhere
7 responses
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Thanks for the heads-up that somebody hasn’t managed to violate the laws of thermodynamics. You’re right of course: capitalists would never back somebody making such preposterous claims.
Tim adds: “Capitalists” as a word or designation (description perhaps?) actually post-dates the South Sea Bubble by oooh, 100- 150 years or so. So you could be right, “never” is the appropriate word. -
So the word didn’t exist, and therefore what it describes didn’t exist either. Of course.
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StuartA and Tim, how would you two define what a “Capitalist” is? The difference could be very illuminating.
Tim adds: Hmm. A rentier of money? -
The definition of “capitalist” doesn’t affect the point I was making. The idea that private investers would not be hoodwinked into supporting some crank perpetual motion-type machine — that only government could be so fooled — is plainly false, as demonstrated by the South Sea Bubble.
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I think Stuart, the point was in that in this age of energy uncertainty, any revelation such as this would have undoubtedly had investors queing round the block if there was anything to it.
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Stuart’s right. It’s as simple as realizing that people err–all people–and that capitalists and other entrepreneurs are people, too (and quite irrespective of whenever a particular name was attached to their specific economic function).
But the points to be taken away from such situations is that:
1. the failures of private entrepreneurs and capitalists (who are always in an entrepreneurial position, themselves) do not primarily burden the general public, whereas the failures of state-sponsored entrepreneurship always do and are, in most cases, even further characterized by heavy administrative cost (not to mention the legislative and rent-seeking overburden);
2. Losses sustained by private groups (entrepreneurs, capitalists, investors) tend to eliminate failures from their ranks and reduce the resource-allocation capability of the less-successful.
2a. Even when missteps in state entrepreneurship come to light (public or not), correction is problematic: in very many cases, such failure is misidentified (or deliberately mischaracterized) as insufficiency of allocated resources–and, as in many hands of poker–followed by “throwing good money after bad.” Examples are simply too numerous and too common to need mention.
So, while Stuart might be correct in the very narrow sense, if he actually believes the sense of what he maintains (that there is no underlying rationale for trusting and expecting the superiority of private over state entrepreneurship)–he’s completely mistaken. -
Stuart’s right. It’s as simple as realizing that people err–all people–and that capitalists and other entrepreneurs are people, too (and quite irrespective of whenever a particular name was attached to their specific economic function).
But the points to be taken away from such situations is that:
1. the failures of private entrepreneurs and capitalists (who are always in an entrepreneurial position, themselves) do not primarily burden the general public, whereas the failures of state-sponsored entrepreneurship always do and are, in most cases, even further characterized by heavy administrative cost (not to mention the legislative and rent-seeking overburden);
2. Losses sustained by private groups (entrepreneurs, capitalists, investors) tend to eliminate failures from their ranks and reduce the resource-allocation capability of the less-successful.
2a. Even when missteps in state entrepreneurship come to light (public or not), correction is problematic: in very many cases, such failure is misidentified (or deliberately mischaracterized) as insufficiency of allocated resources–and, as in many hands of poker–followed by “throwing good money after bad.” Examples are simply too numerous and too common to need mention.
So, while Stuart might be correct in the very narrow sense, if he actually believes the sense of what he maintains (that there is no underlying rationale for trusting and expecting the superiority of private over state entrepreneurship)–he’s completely mistaken.
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