What are the pros and cons of state owned businesses?

[Spiffor]

Originally posted by Imran Siddiqui
I always knew you were against happyiness, now I have proof .

Gah.
We provided a proof. We provided SOMETHING ! And yet we want to destroy happiness

[Imran Siddiqui]

Spiffor:

What would the point be for purchasing in this manner if everyone could do it too? You wouldn't be demonstrating your superiour purchasing power, because everyone will know that you don't have superiour purchasing power. You would be wasting your money.

You have no clue about 'Keeping up with the Jones' do you? I'll let you in on a secret, it ain't about superior purchasing power at all.

[GePap]

I do think having a state run body be fiscally independasnt can work, as long as the profits return to the state coffers, minus whatever is needed to exand and imporve the company to meet whatever goals were set for the coming years. The managers of the comapny may certainly get bonuses, but they should not have control of the coffers themslevs, to avoid corruption. Oh, and customers must have the ability to sue state run companies. The threat of litigation must also exist for them.

Let me run this idea, as far a R&D goes. Eveyrone say for example, that piorvate research gets to mroe durgs becuase private research companiesd make a profit while the state does not. How much fot eh staff of a drug company does actual research? And what is the point of huge add campaings in which drug comapnies spend millions, and ass to their costs of development?

Ok, so lets say we have public companies in chanrge of drug development. The difference would be this: as a whole, the corporation will not make a profit (pertaining to the above notion), but the incentive method would be this: teams of reserachers themselves would porfit from thier discoveries. If and when a drgu developed by a team finally gets to market after all requiste testing, the very individuals who designed it would get a small portion of sales receits themselves, say 1-2%, or up to 5%, dpending on the type and availability of the drug. (the more rare and unlikely te disease, the bigger the cut since sales will be lower) So while the company as a whole does not stand to make huge profits, those doing the research do stand to make money (hence the motivation).

[Kidlicious]

Originally posted by Imran Siddiqui
Spiffor:

What would the point be for purchasing in this manner if everyone could do it too? You wouldn't be demonstrating your superiour purchasing power, because everyone will know that you don't have superiour purchasing power. You would be wasting your money.

You have no clue about 'Keeping up with the Jones' do you? I'll let you in on a secret, it ain't about superior purchasing power at all.

As far as it is 'Keeping up with th Jones' it is about demonstrating EQUAL purchasing power, which would be equally pointless since everyone would know that purchasing power IS equal. It's not just about 'Keeping up with the Jones' though. People want to keep ahead of the Jones'.

[Az]

Originally posted by Imran Siddiqui

That's why we won't let the politicians do the hiring.

Who does the hiring? And if it is controlled by the government, won't it indirectly do the hiring? If not, if something happens (a recession for instance), don't you think perhaps the people will elect those politicians that will pass laws giving more control over the companies (to prevent layoffs)?

There are a number of ways to do this, my favorite would be a commitee of highly-paid public servants, that would be a separate branch of the government, and so will be the press.

Public sways of opinion:

What you've said, together with the banning of private corporations, will be upheld by the constitution. Of course, the constitution can be amended, but, as you know very well yourself, the chances of that happening are, well, close to none.

I would also change the world of advertising. This entire: "Hey, I look hot, so why don't you buy this completely unrelated thing" stuff sickens me.

[Kidlicious]

Originally posted by GePap
I do think having a state run body be fiscally independasnt can work, as long as the profits return to the state coffers, minus whatever is needed to exand and imporve the company to meet whatever goals were set for the coming years.

Just to start, how do you determine how much of the profit will go to expansion?

[:) Smiley]

So far we've got to this:

1. An industry that is a state run monopoly often ends up inefficient, as people running them lack incentives and are spending other ppos money.

2. Pure market economics does not always address social needs, due to tendency for companies to externalize costs.


The logical choice (which is actually fairly common) is you have both state run services and private businesses in the same market, addressing different needs.

Major examples include:

Hospitals
Education
Food distribution
Security
Scientific research
Media
Package delivery
Housing development

In some cases it is better for a state agency to hire a private company to do a service or provide a product rather than for the state agency to make it themselves, especially if the need for the service or product changes frequently. State enterprises are unusually hard to shut down or reduce in size.

[Imran Siddiqui]

As far as it is 'Keeping up with th Jones' it is about demonstrating EQUAL purchasing power, which would be equally pointless since everyone would know that purchasing power IS equal. It's not just about 'Keeping up with the Jones' though. People want to keep ahead of the Jones'.

You have no clue do you? People want newer and better stuff to show off the newer and better stuff and how much cooler they are. Not that they have more money, because the neighbor KNOWS he doesn't!

my favorite would be a commitee of highly-paid public servants, that would be a separate branch of the government

Are those politicians of a different stripe? And who appoints this commitee? What happens when one dies?

What you've said, together with the banning of private corporations, will be upheld by the constitution.

Perhaps, but it'd be SUPER expensive. Remember, you cannot take private property under the US Constitution without just compensation (ie, amount of money it is worth). And saying it is being taken by the state's 'police power' ain't gonna work here.

I would also change the world of advertising. This entire: "Hey, I look hot, so why don't you buy this completely unrelated thing" stuff sickens me.

Ming is gonna hurt you now!

Btw, how much do you think those commericals actually influence people to buy things? Commercials that are more tied to the product themselves will help sell goods.

[GePap]

Originally posted by Kidicious


Just to start, how do you determine how much of the profit will go to expansion?

You create expansions plans during the fiscal year for the next one, using whatever info you need to guage possible future needs for the next fiscal year, and also possible ways to expand or imporve service as well, which you figure will pay back the investment.

[Kidlicious]

Originally posted by GePap


You create expansions plans during the fiscal year for the next one, using whatever info you need to guage possible future needs for the next fiscal year, and also possible ways to expand or imporve service as well, which you figure will pay back the investment.

But who makes the decision to expand? Is it made for the industry as a whole or for each company independently?

[Myrddin]

Oh no, not the efficiency of central planning argument

IT DOES NOT WORK

Supply does not equal demand under central planning

This is why the Soviet Union had great mountains of unwanted goods AND every enterprise hada large unit, trying to find raw materials needed for production by whatever underhand method they could

[Kidlicious]

Originally posted by Imran Siddiqui

As far as it is 'Keeping up with th Jones' it is about demonstrating EQUAL purchasing power, which would be equally pointless since everyone would know that purchasing power IS equal. It's not just about 'Keeping up with the Jones' though. People want to keep ahead of the Jones'.

You have no clue do you? People want newer and better stuff to show off the newer and better stuff and how much cooler they are. Not that they have more money, because the neighbor KNOWS he doesn't!

I think you are talking about something totally different. You started this by saying that people would pay for something because it had a higher price. Now you are talking about people buying things because they are cool. That can be something totally different. Cool things can be cheap too.

[Imran Siddiqui]

The logical choice (which is actually fairly common) is you have both state run services and private businesses in the same market, addressing different needs.

Very true.

Cool things can be cheap too.

That's not the point I was making. Spiffor said that he believed that lower price doesn't always mean more Demand. I agreed, saying in certain cases higher priced goods in a market can have higher demand because of the 'cool' factor.

[Kidlicious]

Originally posted by Imran Siddiqui

Cool things can be cheap too.

That's not the point I was making. Spiffor said that he believed that lower price doesn't always mean more Demand. I agreed, saying in certain cases higher priced goods in a market can have higher demand because of the 'cool' factor.

If people think they are cool becuase they cost more, that is conspicuous consumption. If they think they are cool regardless of the price that is not CC.

[DAVOUT]

I am now convince by the Universal Monastery that Kidicious has in mind, but I have still a technical problem.

Lets make some assumptions :

- Everybody receive the same income
- The production of good and services is the same as before

But some people (40% for instance) do not spend all their income; they save a portion of it. After a few months there are differences in the personal wealth of citizens; if Kiditious let the things go this way, after a few years, big inequalities will appear again. How can we prevent this horror?

- Ask people to return their excess cash to the government. Some will do but most will hide their money.
- Suppress the cash and give cards to all, and at the end of the month you replenish all accounts to one month income.
- Reduce the monthly income to all, since some are able to live with less than the standard income.

Kidicious, this is a very serious problem, what do you decide?