“The Problem of the Commons: Still Unsettled After 100 Years”

Mark Thoma discusses “The Problem of the Commons: Still Unsettled After 100 Years”.

Thoma quotes Robert Stavins as saying that:

Conventional regulatory policies, which have not accounted for economic responses, have been excessively costly, ineffective, or even counter-productive. The problems behind what Garrett Hardin (1968) characterized as the “tragedy of the commons” might better be described as the “failure of commons regulation.” As our understanding of the commons has become more complex, the design of economic policy instruments has become more sophisticated.

The regulation of the commons is a vital problem for Communism. Since this problem is difficult to solve within Capitalism, can it be any easier in Communism?

For an economic system that is based on property rights (such as Capitalism is), the commons (or unowned property) is a problem because it poses an ideological challenge. The basis of Capitalism is that private property is necessary for wealth production: no private property, no wealth. The existence of unowned property cannot be subsumed into the productive process.

Two (2) avenues are offered by Capitalist economists:

1. Government regulation, or a socialist approach; or
2. Market-based regulation in which the market ensures the efficient use of the commons through pricing.

Both of these approaches takes the management of the commons away from the people where it should be belong. However, in any class society, the commons cannot be fairly managed because people are excluded from it because of their class origins.

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Hope and Change? Not for Americans

Ted Rall asks about Hope and Change? Not for Americans.

He argues that:

Democracy—real democracy, the kind people are fighting for in Bahrain and Madison, is incompatible with free-market capitalism.

What Rall leaves unsaid is that, in a real democracy, people elect everyone who has any authority over them: managers; supervisors; councillers; etc.. And people vote for what things are done and on how they are done.

I call this sort of democracy Communism.

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What Egypt & Tunisia Tell us About Iran

Pouya Alimagham asks What Egypt & Tunisia Tell us About Iran.

His main conclusion is that:

Although it remains uncertain which direction they will eventually take, simply by virtue of having emerged within a secular and nationalist framework, the Tunisian and Egyptian revolutions’ current states of triumph provide an alternative to the Iranian government’s theory of revolution. By doing so, they have inadvertently detracted from the allure of Islamic Revolution, which the Iranian government has long championed. In other words, the Islamic Revolution can no longer claim the mantle of being the only path to popular revolution. This challenge to the Iranian government’s discourse on revolution explains why authorities in Iran, however unconvincingly, are attempting to depict the recent revolutions in Egypt and Tunisia as part of a wider Islamic Awakening.

Emphasis Mine

This emphasis on an Islamic Revolution also served to stifle the arguments about the possibility of a Communist Revolution in the Middle East.

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The economic crisis -- What are the main causes?

Jeyakumar Devaraj (Socialist Party of Malaysia) discusses The economic crisis -- What are the main causes?

He traces the trajectory as follows:

• The collapse of the USSR allowed increased exploitation and increased profits through capital investment in the third world (second globalization);
• The reduction in the manufacturing workforce in the first world lead to a sluggish demand for consumer goods;
• Profits had to be invested somewhere and that in the housing market;
• The expansion of the housing market was a specliative buuble;
• The immediate cause of the housing crisis was the rapid rise of the oil price that caused many defaults;
• The governments intervened to save the financial instutions threatened by these defaults;
• The price of these interventions has been austerity measures that has lead to the popular revolts.

I think this analysis misses the ideological driver behind the push to increase home ownership: the growth in the popular support for Capitalism in the form of property owners. And the increase in wealth generated by 'flipping' homes should not be overlooked.

I think the structure of the mortgages created the defaults rather than the increase in oil prices. The mortgages were written to have low interest honeymoon periods of several years that borrowers relied on before 'flipping'.

There was also a whole new class of people who relied on the housing market to replace the jobs lost in the manufacturing movement to third world countries. These were the realtors, mortgage brokers, builders, etc. As such, the loss of manufacturing was not seen as a loss, but, rather, a door to better job opportunities.

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Thank You, Boeing

Paul Krugman says "Thank You, Boeing" for proving the superiority of central planning in certain situations.

In Boeing’s case, they outsourced far too much, only to find that they were getting parts that didn’t do what they were supposed to — and also to find that the subcontractors were seizing a lot of the rents. They discovered, in effect, that there are times when it’s better to rely on central planning than to leave things up to the market.

Emphasis Mine

The efficient organisation of work requires a command and control model.

What work needs to be done requires a democracy. Capitalism tries to implement this through the market in which every dollar is equal. Communism would try to implement this through the vote in which every worker is equal.

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Personal Wiki

I have a personal wiki at https://sites.google.com/site/vieuxcordelier/.

I am currently reading Trotsky's History of the Russian Revolution and putting my reading notes into the Wiki.

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