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Forum Post: Public Capital

Posted 3 years ago on Dec. 14, 2014, 4:26 a.m. EST by donOld (134)
This content is user submitted and not an official statement

When all capital is privately-owned, those with capital prosper… those without do not. Without access to capital, the poor have few choices and must remain dependent on those who do. The poor cannot afford to invest in the education needed for a high paying job and must remain dependent on those offering minimum wage positions. The poor cannot afford to buy their own home and must remain dependent on those who offer rental housing. The rich, on the other hand, can rely on these disadvantages of the poor and capitalize on them. The rich can use their capital to exploit the productivity of minimum wage workers and make huge profits for themselves. The rich can use borrowed money and the rental income from their tenants to acquire apartment buildings and housing properties for themselves. By denying the poor access to capital, the rich can control markets and acquire fabulous wealth for themselves.

But what if all capital assets were publicly-owned and equally accessible to everyone to use? (please hold back your suspicions of communism for a moment, and let me explain) If we simply traded the idea of exclusive-private ownership, for the idea of exclusive-private user-ship, none of our rights to enjoy a private and exclusive use of any major asset would change in the slightest. We could still use a house, or a car, or an office for as long as we desired without any fear whatsoever that someone else could take it away from us.

All major assets would be given a durability rating when they are designed and manufactured. The rating would identify how long each asset is expected to last under normal conditions. Rather than paying the entire production cost of a major asset upfront, consumers would only be required to pay the monthly depreciation costs of any major assets they use.

Imagine the freedom that this would bring. To find a place to live, you would simply contact a real estate agent to find out which homes or apartments were vacant. Once you found one you liked, you would simply move in. No downpayment, no interest, no expensive rent to pay to a profit-hungry landlord… just the true depreciation cost of your usage. If the house you occupy cost $270,000 to build and it was rated to last 60 years, the monthly depreciation cost would be $270,000 divided by 60 years, divided by 12 months (per year), which equals $375 per month. To use and depreciate the house, you would be required to pay just $375 a month. Not bad considering a traditional 25 year mortgage on a $270,000 house with no down payment would currently cost you about $1,575 a month (at 5% interest). Similar savings would apply to your cottage, motor home and car payments.

The cost of using commercial assets would fall just as dramatically as housing costs. Switching to public capital would generate enormous savings on buildings, machinery and equipment… and since businesses would no longer need profits to finance capital assets, all of these savings would be passed along to consumers in prices.

But the switching to public capital would also cause changes in the markets. Quality would become a much more important factor since better quality assets would have a longer durability rating. If the house you occupy cost $270,000 to build but it was rated to last 100 years, the monthly depreciation cost would be $270,000 divided by 100 years, divided by 12 months (per year), which equals $225 per month. So a better quality home would actually cost less to use than a "economical" home in our current marketplace. Even if the additional cost of better quality materials and methods raised the total production cost of a 100-year house to $360,000, the monthly depreciation cost would be only $300... still $75 less than the 60-year $270,000 house above.

If you decided to move, you would no longer have to wait to sell your house. You would simply inform the real estate agent of your plans. The agent would arrange to have a qualified appraiser visit the property. If your occupancy caused only a normal depreciation of the asset, you would be free to leave. If you trashed the place, you would be liable for the repair costs. If you improved the value of the property, you would receive a refund. Replacing private capital with public capital would bring an unheard of level of freedom to everyone.

34 Comments

34 Comments


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[-] 2 points by donOld (134) 2 years ago

Under the current system of capitalism, workers are paid what they are told their labor is worth and capital assets are built. Factories, malls, housing, machinery & equipment are manufactured. The total cost of all these assets is added to prices and passed along to consumers. Even though workers build all of the assets, and then pay more for them (as consumers) than they were paid to produce them, they still never get to own them... the owners of capital do instead. Workers look around you at the empire of assets that have been stolen from you. The office & bank towers, the shopping malls and commercial strips, the apartment units and housing rentals, and all of the machinery and equipment that empowers this industrial theft. How can you possibly not approve of public capital?

[-] 0 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

I wouldn't approve because it would stifle innovation and economic growth. Look around you at those office and bank towers and shopping malls and ask yourself how many of them would have been built under a system where only hobbyists, not businesses, are responsible for constructing all of the buildings?

[-] 5 points by elf3 (3775) 2 years ago

I look at the world wallstreet has created and think to myself...what a shithole. I wonder what America looked like before all this ugliness. When things are only created for efficiency and profit...look what it causes. Building of yesteryear were built to last , they were solid, aesthetically beautiful. While todays wealthy bid millions on a painting they aren't interested in the quality of the work...only what it is worth. They make no room in our society for culture or ideas. Hell even traditions like Christmas are a thing of the past for retail workers. A society without beauty or vitality is not one I really enjoy or desire to live in. With workers stretched to their limits...life shifts to center around this drudgery. It is indeed dreary. Work without rewards. Life without living. How many would be Renoirs are working behind a counter at target or two full time jobs with no opportunity or time to develop their skills? How many Orwells are trapped behind a desk or emptying the garbage, or delivering a package? Caste systems lose the richness of their people...the richness of the individual. Opportunity thrives for those who desecrate beauty and are willing to strip people down to production value and station...(generally the same people who lack ideas or imagination).

[-] -1 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

A stagnating economy can't feed and clothe and house people. Try to remember that Occupy Wall Street was created in response to a recession. You're saying that economic growth isn't that important. Guess what negative economic growth is called? There is a word for it: "recession". Recessions hurt poor people more than they hurt rich people, so if your idea of helping the masses is to stop worrying about economic growth, then -- no. That won't work. That will make the lives of the masses more difficult.

[-] 2 points by elf3 (3775) 2 years ago

What recession? The stockmarket is thriving...they just aren't sharing with their workers anymore. That's why Occupy formed...because trickle down ( tax breaks for the haves/ business owners) doesn't work. There is plenty of wealth that could be made in America...too bad monopolies are preventing entrepreneurship and bribing politicians to overlook the obvious effect on the people.

[-] 0 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

Occupy formed in response to the Great Recession. Half of the people posting to this site back when it all first started were complaining about unemployment.

[-] 2 points by elf3 (3775) 2 years ago

Unemployment is not tied to recession though recessions are caused by unemployment. The more people ws lays off the more their profits go up until people stop shopping which hasn't happened because subsidies keep them in business courtesy of the workers. Occupy Wallstreet was a push against trickle down policy and the Corporatization of our government and laws. It isn't a fair fight. This is a pushback to stop Corporate Democracy...where justice is for sale to the highest bidder ....that is wall street. The unemployed were in recession...everyone else was getting by. If you were wallstreet ...you thrived.

[-] 0 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

Recessions are caused by unemployment. And inflation is caused by companies raising prices. There are some really funny ideas about economics on this web site. Now I remember why I used to have so much fun here.

[-] 2 points by elf3 (3775) 2 years ago

Inflation used to be tied to production costs...now it is tied to speculation, hedge funds, and derivative trading. Is that funny to you? And yes when people are laid off ( not because the company needs to...but because they want to show a quarterly increase) that person will cease shopping. Which leads to low profit speculation... and a flat quarter...because every company is playing this game...with wages as stagnated as they are shopping is down....the only way to show gains is to cut staff. But you can see how this is a downward spiral...and apply the larger picture...and you end up with massive unemployment. Then they play a little rehire game the speculation rises...rinse recycle repeat...lay em off again show an increase (so people end up laid off about every 2 or 3 years). Noone is taking vacation or asking for raises because they live in fear...they blame themselves they don't even realize it is this unwritten policy. When you work for large monopolies it is a matter if time. Downsizing helps keep wages down as well...because when they do rehire...they hire at entry level pay. And yes I've worked for two monopolistic companies (3 years at both before lay offs)..I've witnessed it personally.

[-] 1 points by donOld (134) 2 years ago

Yup, without the power to steal other's productivity, what would be the point of getting up in the morning. Lead the revolution brother.

[-] 3 points by elf3 (3775) 2 years ago

Please explain that better for me...? A relationship must be mutually beneficial. If one is taking to much of the other...it becomes parasitic. If I give all my labor to afford your housing and products it is feudalism as opposed to capitalism. When you own everything already and I can only ever rent it...by giving up all leisure time....then I am not free. And it is far from Capitalism. Also do I somehow seem manly to you? Societies formed so sharing of responsibilities could occur especially democracy. There was a benefit once. Personally now I have my eye out for some free land. Anyone have some? Far away from the other humans because I think I can do better on my own .

[-] 1 points by donOld (134) 2 years ago

This was a reply to TJunkie's sole, repetitive mantra "I wouldn't approve because it would stifle innovation and economic growth."

[-] 1 points by TechJunkie (3029) from Miami Beach, FL 3 years ago

Under a system like this, why would anybody invest in building new housing if they couldn't sell it after they built it?

[-] 2 points by elf3 (3775) 2 years ago

"Buy sell..buy sell...money...stuff...electronics...give me ....french fries...give me an erection...buy sell buy sell...flip it...tear it down...build it up as ugly as possible ...make it cheap ...cheaper...cheapest......give me cars...no tits more tits ...shake it sweetie...how about a smile ....I have money....buy sell...give me. Flip it...."

What a fucking asshole!

[-] 0 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

The question matters, since people need houses. So if you establish an economic system that eliminates the incentive to build houses, then that's kind of a problem.

[-] 2 points by elf3 (3775) 2 years ago

The question is...what are commercial investors doing in a residential market...they buy and build to rent them . They only resale luxury homes. They flip fixer uppers and outbid working class with cash payments then rent them for more than a mortgage...they use tax money to build low income rentals (at market rate though! Since taxpayers subsidize the rest)...just regulate these fucks and get them out of residential housing ...period. I can fix my own home...and paper and paint it...why do I need you to come along to jack up the value ...I don't it benefits you...not society. Fuck flippers! Fuck commercial interests. You aren't building housing for the shmoes unless the government pays you to do it...it is outrageous. Siphoning off our taxes...then on our rents. What a sham.

[-] 0 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

Did you build your own home with your own money? Or did somebody else build it with money that you borrowed? Or did you buy it from somebody else after they built it with money that they borrowed?

[-] 1 points by elf3 (3775) 2 years ago

You first...What kind of home do you live in? How about a bit about yourself...tell us what do you do? Do you work in Technology? How do you make money?

[-] 0 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

Yes I'm a technologist. I create new technology jobs. The ancient archives of this forum include me begging for months for people to take me up on my offer to pay them to give them on-the-job training to learn software development. Only one person took me up on it. He worked with me for a year and then got a degree in computer science and now he has a full-time job in Silicon Valley doing software development. Just about everybody else simply continued to complain about unemployment.

I live in a condo building on an artificial island. Neither my building nor the island that it sits on would exist under donOld's proposed economy because both required massive coordination of project management and investment. A bunch of hobbyists are not going to build an artificial island with a bunch of high-rise buildings on it just for kicks.

[-] 1 points by donOld (134) 2 years ago

You're right, the smart thing to do would be to build on existing, unused land. Without profit, all industries become hobbies... I like it!

[-] 0 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

Hopefully all of the people living in shanty towns will like it too.

[-] 1 points by donOld (134) 3 years ago

Because there is a demand for housing, and because some people like designing and building stuff.

[-] 2 points by elf3 (3775) 2 years ago

There is a demand for housing because the haves are hording it ...they sit on it and rent it as a way to hide assets...capital gains tax only. Free the houses..tax commercial landlords ( those who rent for profit) a commercial rate. Fuck capital gains. Landlording is a business unless you live in a two family like physically on it as prime residence. I will say it again...landlording is a business...it is a for profit industry. And yet...I pay more taxes to own and just live somewhere.

[-] 1 points by TechJunkie (3029) from Miami Beach, FL 3 years ago

If you didn't realize how unrealistic this idea is when you typed that, then there isn't much that I can do for you.

[-] 1 points by donOld (134) 3 years ago

Self-fulfillment is only unrealistic in our current economic system. Chasing after money and stepping on others is not fulfilling... it's just tiring.

[-] 1 points by TechJunkie (3029) from Miami Beach, FL 3 years ago

It's pretty exciting if you're good at it.

You can't see how the economy would contract if people didn't have to work tedious jobs? Somebody has to work those jobs. Not just the fun jobs.

[-] 2 points by elf3 (3775) 2 years ago

Sure those who can't afford education. We get to service your bunions. So sad that our brains and creativity get to atrophy under this type of system while someone with the intelligence of a flea can thrive as long as their family has money.

[-] 0 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

I understand that you think that it's unfair that some people have to work crappy jobs. But somebody has to work those jobs. The current system does at least ensure that there are people working to pick up the trash and clean out sewers. If society falls apart under a new, utopian economic system then that doesn't seem like an improvement.

[-] 2 points by elf3 (3775) 2 years ago

I prefer a merit based system...not a caste. Perhaps if I didn't seem so many dumb fuck politicians raking it in ...while people with brains are sweeping floors and darning their socks...yeah I guess unfairness is a word for it. Or that it is total fucking bullshit another. Please I would love a city job picking up trash...those people make a ton. I don't know any connected rich people though. That's how you get one of those. What are you anyway some kind of Communist? Would you like to issue me a number too ....oh wait I have one of those corporations use it to track my every purchase and my capitalist activity. You get marks like demerits that stay on your record. You can earn points again by buying from those in charge.

Jobs don't have to be crappy btw. Unions used to keep them decent and keeping up with inflation. Outsourcing changed all that.

[-] -1 points by TechJunkie (3029) from Miami Beach, FL 2 years ago

I'm objecting to the guy who wants to eliminate money and mandate societal equality with talk about innovation and economic growth -- and you conclude that I'm a communist? Really?

[-] 1 points by donOld (134) 3 years ago

I ask people, every day, what they would do if all jobs paid the same hourly wage. I am surprised by the number of people, now working tedious, minimum wage jobs, who say they would continue doing the same thing. I also asked a bus driver, who told me he would become a fireman. I asked him why he would risk his life going into burning buildings when he could make the same money driving a bus. He smiled and said I've always liked doing it... I'm a volunteer fire fighter now.

[-] 1 points by TechJunkie (3029) from Miami Beach, FL 3 years ago

Interesting, I'm also a volunteer firefighter/EMT. But that's rewarding. Who would clean sewers? Who would lay asphalt? Who would solder circuit boards?

The answer is that nobody would, and the economy would contract. And that would hurt poor people a lot more than rich people.

[-] 1 points by donOld (134) 3 years ago

The economy might change, but it will certainly not contract. Providing everyone with the means to be more productive will not reduce productivity. What it will do however, and what frightens the hell out of you, is give people the right to vote with their labor and their lives for the kind of world they want to live in. If no one wants to clean sewers or lay asphalt so be it. Society will have to adapt. As the sewers start to back up and the roads disintegrate, most likely some people will change their mind and become willing to do something about it. Better roads and sewers will be built and society will continue on.

[-] 1 points by TechJunkie (3029) from Miami Beach, FL 3 years ago

You haven't proposed a way to provide everybody with a means to be more productive. You have proposed eliminating the motivation to improve productivity. Huge difference.

Your plan for infrastructure maintenance reminds me of the Underwear Gnomes on South Park:

Phase 1: Eliminate money Phase 2: ??? Phase 3: Better roads and sewers!!