[idoh]

Regarding 1), what do you mean when you say that "capitalism needs ever-increasing consumption to sustain itself"? I don't think that this has been established.

I'm using the standard dictionary version of capitalism: "an economic system in which investment in and ownership of the means of production, distribution, and exchange of wealth is made and maintained chiefly by private individuals or corporations, especially as contrasted to cooperatively or state-owned means of wealth."

[mindcrime]

I don't think that this has been established.

It hasn't. That's only true for a very specific aspect of capitalism, which is the speculation based, "buy equity and resell it later at a profit" model. But nothing specifically dictates that capitalism has to work this way. Investors can get a return on their investment through, for example, dividends. One could also argue that in a truly free market / capitalist environment, a LOT of the trappings of contemporary "capitalism" would not exist... corporations, for example, violate the connection between one's actions, and liability for the consequences of those actions. We rationalize that buy saying it encourages investment (and it probably does) and allows larger companies (it does)... but one can fairly ask if those ends justify allowing this violation of fundamental principles.

[tjpaudio]

Established, no, because establishing it would be akin to correctly predicting peak oil. As a matter of pure math with the banking system we are globally bought into, that is fractional reserve banking, yes you need ever-increasing GDP or people will be unable to pay back loans and everything collapses. New technology, new resources, etc. stave this off from happening. It is absolutely true that there are finite resources on earth, but when we run out to the point that it impacts our financial system is anyones guess. Hence the meteors comment.

[throw51319]

No, in a truly free market the corporations can just pass on the negative externalities of their actions without any consequences if the other actors don't understand the negatives.

Ex. Price of oil doesn't count in future damages from climate change -> inputs to product are cheaper -> corporations profit while everyone is negatively impacted.

You really need a free market, with any global negative externalities taken care of by a government. I don't see why people (not talking about you) don't understand this.

[mindcrime]

No, in a truly free market the corporations can just pass on the negative externalities of their actions without any consequences if the other actors don't understand the negatives.

I would argue that, in a truly free market, the "corporation" as such, would not exist at all. Consider that corporations are legal fictions created by the State and could not exist without the government granting their special "limited liability" status. That in and of itself is a market distortion.

[throw51319]

You're just talking about the semantic term itself? I mean there would be a group of people who start working together and growing organically... because of the gain in efficiency through individual specialization. So idk what you're saying. They would produce and sell things to others. No regulations mean that they could obfuscate the negative externalities to the best of their abilities if they wanted to go for straight profit.

[mindcrime]

It's not just semantics. A "corporation" is a very specific thing which operates in a certain way because of the way it is defined legally. Without the legal fiction of the "corporation" groups of people could (and would) still cooperate to form businesses, but now the individual owners would not be artificially shielded from legal liability for the outcomes of the businesses actions.

IOW, if you, me and 10 other people get together, start a business as a "partnership" and build a bridge that collapses and kills a bunch of people, each of us, as owners, can be held liable individually for the damage/deaths involved. If we form a corporation, references to "piercing the corporate veil" aside, none of us stand to lose anything more than the amount we invested in the corporation. "Corporations" where created specifically to enable businesses to have larger numbers of owners ("investors"), and part of that was achieved by placing that artificial limit on the liability of the individual owners[1]. The reason for this was nominally a Good Thing, because it allowed larger businesses that could take on risks that smaller businesses would not be able to handle. But one can certainly question if that trade-off was justified... and as I argued before, as a distortion of true "free market" principles, this construct would not exist in a world which strictly held to pure laissez-faire / free-market capitalist ideals.

That said, I will say that there is a semantic aspect to all of this... the term "corporation" has a particular legal meaning in modern times, but the word in the popular vernacular, it is used differently in different parts of the world, and the meaning has changed over time. So just to be clear, when I say "corporation" I specifically mean the modern shared-stock / limited-liability corporation which is a legal fiction created by the State, upon registration by the owners.

[1]: https://en.wikipedia.org/wiki/Corporation#Limited_liability

[throw51319]

Yeah good point. Thought provoking on the idea of what a "corporation" can become these days, especially from a multinational standpoint...

[idoh]

Thanks mindcrime, that's a really interesting answer. It is fair to say that some things normally associated with capitalism depend on growth, e.g. equities.

On the topic of corporations, I can see the point about liability. There could be a world without corporations, and instead use partnerships with pass through liability. I wouldn't take that trade though, because if anything the world needs more innovation, and for the most part the liabilities are financial, and the counterparties are aware of the risk. Some liabilities do seem unfair to limit liability, for example environmental ones, because it hurts people who never agreed to assume any of the risk.

[mindcrime]

It is fair to say that some things normally associated with capitalism depend on growth, e.g. equities.

Yeah, I think that's true. If people expect perpetual growth, that seems to imply constantly growing revenue, which would seem to imply the need for constantly growing consumption, which would seem to imply the need for perpetual population growth, etc. My only point is that capitalism, in "textbook form" at least, doesn't specifically demand that. Now, maybe it's an inevitable emergent aspect of capitalism... I honestly don't know. Whether or not that is the case would be an interesting thing to research.