[Andrew_Quentin]

I do not mind the downvoting. I expected it, but still chose to reply because I do not think that my points are not worth making, I do not think I am trolling, but instead it seems that I have been able to generate a nice intellectual debate about a matter which is extremely relevant today in a forum where intellectual debate is encouraged.

I should also add that perhaps I do not hold any belief in what I said or any sort of conviction. I am theorising about how a system can be improved and am very much open to be shown that my suggestions are not optimal.

You say that my points are easily refuted, yet it seem that you are not addressing them fully.

Predatory pricing, according to the linked wikipedia article, occurs when the price is set below the cost of production. I have nothing against profits, but exuberant profit which I think is the product of exploitation.

Apple invented the Iphone and the Ipad and before that the Ipod. All are great products. All wanted these products. The products have benefited society greatly. That all is good.

It also explains the great profit made, in my opinion. The competition, which to start with there was none, came later to the game and as such had a less favourable environment because they faced a competitor, unlike Apple to begin with. I think therefore that the profit generated has little to do with efficiency - although that probably is a factor - and much more to do with the fact that they invented a unique product which everyone wanted. Thus, had a monopoly in practice.

Invention is of course to be encouraged, but not the exploitation of such invention. I do not think it can be doubted that they made a 30% profit on their revenue because they priced their products 30% higher than their actual cost. That means that millions of people had to give away more of their wealth to one person or one company making such person or company richer, while everyone else poorer.

No one forced them, but that is beside the point. No one forces anyone to buy electricity. What person can today for example have a decent job and not a computer. It can even be said what person can have a decent job and not an Iphone or a smartphone.

If you agree with that point, that one should be able to make a profit but not excessive profit, then the question becomes technical, namely, what is excessive.

I said 1 million in total remuneration for an individual. You say why not 100,000? The example you gave is a very good answer to that question. 100,000 would not allow for differentiation between individual productivity. That cap can easily be reached, as you showed from that example. There are many people today earning 100,000 and probably they deserve it. They are many people earning 400,000 or 500,000. You can count on one hand however the people that are earning a million or more in total remuneration. In my opinion, such people are awarded such amounts not because of any genuine extra productivity, but because there is no mechanism which can keep a check and balance on their pay.

1 million therefore allows for the differentiation of individual production and is a sufficient amount to incentivise producers.

So what argument can there be against setting a maximum remuneration at a cap of 1 million? The only one I can think of is that of founders. Bill Gates for example has certainly contributed more to the world than many others who may be capped at one million.

It is not difficult, conceptually and even practically to make an exception for founders and set their cap to 1 billion. One billion, in my opinion, is a sufficient incentive for anyone. Why, afterall, should their children, who merely won a lottery, have a higher claim on their fathers wealth than 1 billion?

You may say that it seems that I am simply picking up these numbers from thin air. Perhaps you are right. I think however that the vast majority of people - and we live in a democracy where the majority rules - would agree that if a cap is to be set it should be at such levels, or perhaps, slightly higher, i.e. maybe 2 million and 2 billion. That, however is a point about technical matters which is worthy of discussion if one agrees with the main principle. Which is that society should have a say on the maximum profit and remuneration of an individual and company so that society as a whole can benefit at an optimal level.

As to whether it is more communism or capitalism in my opinion is irrelevant. It is neither. It is a mixture of the two. You can have profit - capitalism - but not too much profit - communism.

I do not think simply because something may be linked to some ideology it should be discounted for that reason alone, as you accepted. Neither communism nor capitalism are perfect, they both are extremes, thus perhaps a middle ground would be best.

[jonhendry]

"That means that millions of people had to give away more of their wealth to one person or one company making such person or company richer, while everyone else poorer."

No, the people who bought Apple's products were not poorer. They converted part of their wealth (or resources if you prefer) from currency to an Apple device, having decided that the exchange was a fair one.

Electronics don't hold their value very well, so over time the person will gradually become "poorer" in the sense that they could not sell their Apple device and get their money back. But in the meantime the person was richer in that he or she had the use of the device.

[eugenejen]

Also this falls into the "pie fallacy" of view of wealth. Total wealth in the world is not a static function that doesn't change overtime. If people decide to exchange some of their wealth and "time" to make them feel happy and satisfied and just their state of happiness make them produce more stuffs/services/quality of life because they are much happier than they were before exchange. Is that a negative thing?

[stryker]

>> Predatory pricing, according to the linked wikipedia article, occurs when the price is set below the cost of production. I have nothing against profits, but exuberant profit which I think is the product of exploitation.

Yes, strictly speaking, predatory pricing is when products are priced below cost. My point was that in the absence of competition, artificial price cutting makes it more difficult for newcomers to setup shop, and in the presence of competition, is a natural result.

>> No one forces anyone to buy electricity.

Actually, if you look at the law, it specifically lists certain types of public utilities, such as electricity, that must be regulated because the providers are what are called "natural monopolies". You basically are forced to buy electricity from one company (or two) and electricity is nowadays considered a necessity. But I digress.

>> one person or one company making such person or company richer, while everyone else poorer.

You can't look at every transaction as simply an exchange of money. By that metric, every time I buy some food, I'm becoming poorer. True, but pretty meaningless, because I would have not spent it any other way. Now are you claiming that an IPad is a "basic necessity"? People chose the IPad, even among similar knock-offs, if they chose to buy one at all. I, for one, have chosen not to buy any tablet. In any case, these buyers are basically saying, "I'm happier with an IPad than $600".

Perhaps there's an externality here, where people end up wasting more time and reducing their productivity as a result of buying up IPads, and so Apple should be forced to pay that cost to society. But that's still a different issue than your claim, which is that they're priced "too high".

>> thus perhaps a middle ground would be best.

Note that our current economic system is not so extremely capitalist. It's capitalism + externality pricing + taxes + (other stuff that I frankly think is government mandating inefficiencies to support special interests, like subsidies).

>> Which is that society should have a say on the maximum profit and remuneration of an individual and company so that society as a whole can benefit at an optimal level.

I can think of another way to phrase this claim -- most people will not live any happier with $1 billion than $1 million. All that extra money could be used to increase the utility of other people by a much higher margin.

But I must note: people already do donate. I'm sure you've heard of the billionaire's pledge. It's happening TODAY, in our capitalist society. Like my example with Bob and Jake, in our society, people have a choice. They have a choice to donate their billions to the plights of the world. In your world, all citizens will be forced to.

So I guess to summarize: 1) I like giving people choice. 2) I think if you give government an inch, they'll take a mile. Even if capitalism and communism were identically effective theories, a government in a communist economy by definition is so much more powerful than a government in a capitalist economy... I think the corruption would be difficult to battle.

EDIT: By the way, it sounds like you are pretty reasonable. However, your initial tone of "profits are evil" and that false economic policy statement "companies should price just above cost" probably pissed a lot of people off. You probably shouldn't say those things because they're not your main point anyway and they just close off people unnecessarily. As I've seen, you clearly have a more reasonable way to express your arguments anyway!