Is it time to ban unions?

cdebru · 13-07-2004 6:55pm

A bonus may be work related, in which case it is a payment for labour whose value exceeds agreed or expected labour. If the bonus is not related to productivity then it is a gift - such as a Christmas bonuses or even other automatic bonuses such as share options upon a firms IPO.

christmas bonuses are usually based on productivity or are are a percentage of the basic salary and where given are part of the cost of labour usually forming part of the contract

other payments such as share options upon a firms ipo are given as a reward for labour or as in the case of eircom to ensure the compliance of staff with a new arrangement
a gift would have not strings attached and would not expect a return
if a bonus is given in the belief that not giving it would lead to problems it is not a gift it is a payment to prevent a problem

automatic bonuses would suggest that there is no option but to give it
that it forms part of a contract and as such would be part of the cost of labour

The Corinthian · 13-07-2004 7:14pm

Originally posted by cdebru
so what is the fallacious sweeping statement i made

Try the two I quoted in my first rebuttle. Last time I looked gems like...

“thats because you are self employed and can set your own wages as you see fit”

...and...

“thats crap its employees labour that produces profit”

...are both fallacious and sweeping.

actually i have read plenty of economic theory micro and macro studied it for two very boring years

I studied it for a fair bit more than two years, have a degree in it and have worked in the financial services sector (in the derivatives market) too.

but just because i have read it and understood it does not mean that i have to accept it as the truth

I don’t dispute that you may have read on the subject, only your understanding of it.

nor do i have to accept that the model that you would believe in is the best way for this or any ecomomy

Of course not, but actually factually arguing why you don’t believe in this model would help with your credibility.

and presumably you are of the opinion that you know everything on the subject
i'm impressed

I certainly don’t know everything on the subject - that would appear to be you jumping to conclusions again. However, I would appear to have a better grasp of even just the fundamentals of Microeconomics than you.

christmas bonuses are usually based on productivity or are are a percentage of the basic salary and where given are part of the cost of labour usually forming part of the contract

They may be based upon a percentage of salary (and not always at that) but they’re certainly not based upon productivity.

If, however, they’re part of a pre-agreed contract, then all well and good, but I’ll have to say I’ve not ever heard of any such contract outside of the civil service, where it’s unlikely to bare any relationship to productivity.

other payments such as share options upon a firms ipo are given as a reward for labour or as in the case of eircom to ensure the compliance of staff with a new arrangement

You mean a bribe. Last time I looked, that was not related to productivity.

a gift would have not strings attached and would not expect a return
if a bonus is given in the belief that not giving it would lead to problems it is not a gift it is a payment to prevent a problem

Utter rubbish. You’re suggesting that bribery and blackmail is somehow liked to productivity - that if a union demands a bonus or shares, without which it will close down the company, it has somehow earned it.

I suppose councilors who take bribes for rezoning land have earned their money too?

cdebru · 13-07-2004 8:01pm

Try the two I quoted in my first rebuttle. Last time I looked gems like...

“thats because you are self employed and can set your own wages as you see fit”

...and...

“thats crap its employees labour that produces profit”

...are both fallacious and sweeping.

so who if not the self employed person set their wage as you see fit obviuosly means with regard to the conditions within the company
you can not pay yourself money you dont have

without labour there is no profit i see nothing fallacious about this

Utter rubbish. You’re suggesting that bribery and blackmail is somehow liked to productivity - that if a union demands a bonus or shares, without which it will close down the company, it has somehow earned it.

i never mentioned bribery or blackmail if you think that a threat to withdraw labour is blackmail then that is how you look at the world
i would call it using the power that is available to you to secure what you believe you are entitled to
as to wether they have earned it that is a matter of opinion when has anybody earned anything when you decide to give it to them or when they think they deserve it

to relate the use of trade unions using the right to withdraw labour to win benefits for their members with corruption in the planning area says a lot about where your coming from

i just hope for your companys sake that you dont move into the human resources department]

studied it for a fair bit more than two years, have a degree in it and have
worked in the financial services sector (in the derivatives market) too.

do you know how impressed iam in that a degree wow
the derivatives market
that must be so exciting

christmas bonuses are usually based on productivity or are are a percentage of the basic salary and where given are part of the cost of labour usually forming part of the contract

They may be based upon a percentage of salary (and not always at that) but they’re certainly not based upon productivity.

i cant believe that in your vast knowledge of the world that you have never heard
of a bonus given at christmas time that is based on productivivty througout the year
off the top of my head i know one of the major stockbroking firms in Ireland operates such a bonus scheme

ask your pals around the ifsc they might be able to help you out
and broaden your knowledge

cdebru · 13-07-2004 8:09pm

a gift would have not strings attached and would not expect a return
if a bonus is given in the belief that not giving it would lead to problems it is not a gift it is a payment to prevent a problem

Utter rubbish. You’re suggesting that bribery and blackmail is somehow liked to productivity - that if a union demands a bonus or shares, without which it will close down the company, it has somehow earned it.

I suppose councilors who take bribes for rezoning land have earned their money

too?

what i actually had more in mind was say for example a payment to facilitate the adoption of new work practices or machinery
or moving premises for example
these are not gifts
they are labour costs
it may effect productivity if not given
even though it may not increase productivity not paying may affect the contention of your staff and decrease your productivity
a happy contented staff work harder

The Corinthian · 14-07-2004 12:24am

Originally posted by cdebru
so who if not the self employed person set their wage as you see fit obviuosly means with regard to the conditions within the company
you can not pay yourself money you dont have

Thank you for the qualification, but that’s not what you said and TBH, ‘as you see fit’ hardly congers up images of ‘within boundaries’. You’re very obviously backtracking.

without labour there is no profit i see nothing fallacious about this

Again that’s not what you said - you specifically claimed “its employees labour that produces profit” - saying that there is no profit without labour (which incidentally is incorrect (e.g. speculation) has nothing to do with that statement, but is a new argument. Again, very obviously backtracking.

i never mentioned bribery or blackmail if you think that a threat to withdraw labour is blackmail then that is how you look at the world

Is that supposed to be an argument?

as to wether they have earned it that is a matter of opinion when has anybody earned anything when you decide to give it to them or when they think they deserve it

Then if you steal you’ve earned it, it would appear. The end justifies the means.

to relate the use of trade unions using the right to withdraw labour to win benefits for their members with corruption in the planning area says a lot about where your coming from

Again, is that supposed to be an argument or just another attempt to avoid the fact that you cannot rationally rebut my points?

do you know how impressed iam in that a degree wow
the derivatives market
that must be so exciting

Well you were the one who wanted to let me know how well qualified your leaving cert economics made you.

what i actually had more in mind was say for example a payment to facilitate the adoption of new work practices or machinery
or moving premises for example
these are not gifts
they are labour costs

Thanks for the qualification - more changing of the goalposts. Try addressing what you said, not what you now wish you said.

cdebru · 14-07-2004 12:48am

Thanks for the qualification - more changing of the goalposts. Try addressing what you said, not what you now wish you said.

i changed nothing since you either are incapable of understanding or deliberately trying to misinterprate what i said
i tried to clarify some things for you
but you cant answer any of that so you suggest i tried to change the goalposts to avoid the answer

Again that’s not what you said - you specifically claimed “its employees labour that produces profit” - saying that there is no profit without labour (which incidentally is incorrect (e.g. speculation) has nothing to do with that statement, but is a new argument. Again, very obviously backtracking.

no backtracking labour is what produces profit
if you assume labour to only mean physical labour then that is your narrow definition
not mine
is their no labour on the speculation on the derivatives market
if not what do you get paid for

some people are paid to think some people are paid to shovel **** its all labour
and its what produces profit

the world is more that economic theories and numbers
its made up of real people

cdebru · 14-07-2004 12:58am

Thanks for the qualification - more changing of the goalposts. Try addressing what you said, not what you now wish you said.

no what i said and continue to say is that
all salaries bonuses and other benefits are in return for labour

they are part of the cost of labour
they are not gifts

a bottle of wine on a birthday is a gift
a bonus at christmas is salary
paying your vhi is salary

shares or share options are salary

not gifts

The Corinthian · 14-07-2004 1:34am

Originally posted by cdebru
i changed nothing since you either are incapable of understanding or deliberately trying to misinterprate what i said

You were pretty specific in what you said, that’s why I even quoted you, so it would be hard to misinterpret it.

i tried to clarify some things for you
but you cant answer any of that so you suggest i tried to change the goalposts to avoid the answer

Except that given that your clarification was completely new and unrelated to what you actually said, that would be changing the goalposts. You can’t change your argument completely and call it ‘clarification’ - that’s just changing your argument.

no backtracking labour is what produces profit
if you assume labour to only mean physical labour then that is your narrow definition
not mine
is their no labour on the speculation on the derivatives market

And the capital bares no relation to this? Ever speculate with no money or credit? I wonder how much labour interest requires?

some people are paid to think some people are paid to shovel **** its all labour
and its what produces profit

Let’s not forget raw materials, capital and risk while we’re at it. Or have you ever tried setting up an enterprise with no capital, or build a product with no materials?

the world is more that economic theories and numbers
its made up of real people

Let’s throw reason out the window in favour of cheap sentimentality, shall we?

cdebru · 14-07-2004 2:10am

you cant answer so you just acuse me of moving the goalposts

still didn't answer can you make profit without labour
does speculation involve labour

of course speculation involves capital i never said it didn't
and shoveling sh*t requires shovels whats your point

without labour you just have you just have shovels and a pile of sh*t that aint going anywhere

The Corinthian · 14-07-2004 3:17am

Originally posted by cdebru
you cant answer so you just acuse me of moving the goalposts

I have - you’re the one who’s ignored the entire content of my last post and only responded to the last point in the previous one, so don’t bother to accuse me of what you are blatantly doing yourself.

still didn't answer can you make profit without labour
does speculation involve labour

A little labour, but mainly risk and capital. How about interest? Does that involve labour then or are you going to ignore that point again?

of course speculation involves capital i never said it didn't

But according to you it is labour that produces profit, not capital (and if this is incorrect, point out where you’ve said so). All I’ve done is disagreed with fallacious comment from the onset.

and shoveling sh*t requires shovels whats your point

Raw and processed materials such as tools are also inputs to production.

without labour you just have you just have shovels and a pile of sh*t that aint going anywhere

And without shovels you’re not going to get far either. Or would you prefer to use your hands?

MrPudding · 14-07-2004 9:08am

Originally posted by RainyDay
I'll try a 3rd time, Cork;

Please name just one private sector company where employees pay for stock options

I won’t name my company but employees must pay to exercise share options. My mother used to work for Woolworths, they also had to pay for share options. No company gives free share options, they are simply a type of employee share purchase plan. Some companies do actually give shares away for free, subject to tax and BIC (I think) of course. These tend to be only in exceptional circumstances.

On a brief aside. My company has an employee purchase discount plan. I can but my companies products and get a small discount. I have to pay BIC on this. That is the law. A short time ago one of the unions was up in arms because Dunnes told their staff that they would have to pay BIC on their employee discount. My question is this, is there a reason why they don’t already pay BIC? And also, if they are supposed to be paying BIC why are they not? And finally, if they should pay BIC, what gives the union the right to demand that the law of the land does not apply to their members?

MrP

bonkey · 14-07-2004 9:42am

Originally posted by MrPudding
but employees must pay to exercise share options.
...
No company gives free share options,

Yes, they do. I'm willing to bet your company does.

You pay to exercise the option. You do not pay to acquire the option.

The option is given to you. You do not pay for it, surely? If you receive the option, and never cash it in, you still were given the option and you didn't pay for it.

If you do pay just to get the option in the first place, then your company is truly the exception.

jc

RainyDay · 14-07-2004 10:24am

Originally posted by MrPudding
I won’t name my company but employees must pay to exercise share options. My mother used to work for Woolworths, they also had to pay for share options. No company gives free share options, they are simply a type of employee share purchase plan. Some companies do actually give shares away for free, subject to tax and BIC (I think) of course. These tend to be only in exceptional circumstances.

Hi Mr P - You need to differentiate between recieving stock options & exercising stock options. In your scenario, you pay when you exercise the options (if you want to hold the shares, that is), but you didn't pay when you received the options.

While I don't know Woolworths particular case, I know of a number of other retailers (incl Tesco) who have Revenue-approved SAYE (save as you earn) schemes for funding the exercising of stock options, but they did not have to pay out to receive the options in the first place.

MrPudding · 14-07-2004 12:11pm

Originally posted by RainyDay
Hi Mr P - You need to differentiate between recieving stock options & exercising stock options. In your scenario, you pay when you exercise the options (if you want to hold the shares, that is), but you didn't pay when you received the options.

While I don't know Woolworths particular case, I know of a number of other retailers (incl Tesco) who have Revenue-approved SAYE (save as you earn) schemes for funding the exercising of stock options, but they did not have to pay out to receive the options in the first place.

OK. I meant employees pay to exercise their share options. I though the fact that I mentioned that in the first line would be enough to show that is what I meant. Apologies for any confusion.

The act of giving employees an option is worth nothing unless they exercise it. If they do they have to buy the shares. Correct me if I am wrong but what we are talking about here is not that public servants want to be given a portion of the company outright. They do not want the an option to buy if they feel like it. They want it for free. This is very different from company stock options as with a company stock option you don’t actually own any stock unless you cough up the money for it.

MrP

RainyDay · 14-07-2004 1:24pm

Originally posted by MrPudding
The act of giving employees an option is worth nothing unless they exercise it. If they do they have to buy the shares.

Not true. When you exercise an option, you have three choices. You can;

- Exercise & sell
- Exercise & hold
- Exercise & sell to cover

If you exercise & sell, you don't need to pay anything. Your broker will temporarily provide the funding required to buy the share at the option vesting price, and will get his money straight away as he sells. You get the difference between the vesting price and the current market value.

If you exercise & hold, then you do need to pay out to buy the shares, but obviously you get to buy the shares at the option vesting price rather than the current market value.

If you exercise & sell to cover, basically you do the exercise & sell as described above, and use the proceeds to buy fresh shares in the company, so you end up with a lower number of real shares. You do NOT have to pay anything in this case.

Originally posted by MrPudding
Correct me if I am wrong but what we are talking about here is not that public servants want to be given a portion of the company outright. They do not want the an option to buy if they feel like it. They want it for free. This is very different from company stock options as with a company stock option you don’t actually own any stock unless you cough up the money for it.

There is no fundamental difference in principle from private companies who provide stock awards and/or stock options as part of their remuneration package and semi-state employees getting a chunk of the company as part of a renegotiation of their contracts during a sell-off. There may be differences in scale & quantity, but the principle remains the same.

Sherlock · 14-07-2004 4:23pm

Originally posted by RainyDay
[
There is no fundamental difference in principle from private companies who provide stock awards and/or stock options as part of their remuneration package and semi-state employees getting a chunk of the company as part of a renegotiation of their contracts during a sell-off. There may be differences in scale & quantity, but the principle remains the same. [/B]

Difference is that semi-state companies are owned by the state (i.e. the Irish population) and should not be given away to employees for nothing.
The likes of Dell can do whatever they like with their own company.

MrPudding · 14-07-2004 5:56pm

Originally posted by RainyDay
Not true. When you exercise an option, you have three choices. You can;

- Exercise & sell
- Exercise & hold
- Exercise & sell to cover

I am aware of how they work. My point remains. You have to buy the shares. It may be the case that you can pay for them after you have sold them but you still have to pay. When you sell them you get the sell price less any commission and less the cost of the shares.

The deal the public servants want, as far as I can tell, is that they are simply given a chunk of the company. To me this is different from the option scheme a private company has.

Example, I am in a share scheme. I have sign up to a share option. Some money is taken from my salery every month. After 6 months I will have the opyion to buy shares at a discounted price. If I choose not to exercise the option I don't get the shares. If I choose to excercise the I then decide which of the options you mention above I want. The point is one way or another I pay for the shares.

MrP

RainyDay · 14-07-2004 6:48pm

Originally posted by MrPudding
I am aware of how they work. My point remains. You have to buy the shares.

Yes - but you don't pay to get the option. You get the option as part of your remuneration package. When you exercise the option, you can do so without handing over any cash (exercise & sell), if you so wish.

Originally posted by MrPudding
Example, I am in a share scheme. I have sign up to a share option. Some money is taken from my salery every month. After 6 months I will have the opyion to buy shares at a discounted price. If I choose not to exercise the option I don't get the shares. If I choose to excercise the I then decide which of the options you mention above I want. The point is one way or another I pay for the shares.

This sounds like a share purchase scheme, not a share option scheme. An option is a right to buy a share at a known fixed price at some time in the future. At the start of the six month period, do you know the exact price at which you will be buying the shares in six months time? [Note: I don't mean the level of the discount (e.g. 15%), I mean the specific price in euro or dollars at which you will be buying].

In my last employer, part of the annual bonus was paid over in shares. This is giving me ownership of a slice of the company without me paying over cash for this. There is no difference in principle between this and giving semi-state workers a slice of their company.

cerebus · 14-07-2004 6:50pm

Originally posted by MrPudding
The deal the public servants want, as far as I can tell, is that they are simply given a chunk of the company. To me this is different from the option scheme a private company has.

Example, I am in a share scheme. I have sign up to a share option. Some money is taken from my salery every month. After 6 months I will have the opyion to buy shares at a discounted price. If I choose not to exercise the option I don't get the shares. If I choose to excercise the I then decide which of the options you mention above I want. The point is one way or another I pay for the shares.

It looks like what you are describing is more commonly know as an employee share purchase scheme/plan. This is slightly different to an incentive stock option, though both schemes are referred to using the umbrella term "options".

In a typical employee share purchase scheme, an employee contributes money by payroll deduction which gets used (in your case, every 6 months) to buy shares at a discount to the fair market value on the day of purchase.

The incentive stock option (used by many tech companies as an integral part of employee remuneration) is different - here is how it works.

- The company gives the employee the 'option' to buy a certain number of shares at a fixed price. There will be some period of time before these options become exercisable (many companies allow you to exercise 25% after one year, 100% after four years or something similar), and a period of time after which the option expires (usually 10 years).

- There is no need for the employee to fund the purchase of these option shares out of their own pocket. It can be avoided by using some of the techniques outlined by RainyDay above. For example, when the employee decides to exercise these options, it will usually be when fair market value > option grant price. The employee can sell the stock using a same day exercise and sale - the broker advances the money required to purchase the option, and gets this back once the shares are sold. As a result, the employee never has to fork over any money - the stock is sold at market value, and the employee gets (market value - exercise price) * number of shares sold.

So, in this case, the employee never is out of pocket with this stock purchase. In many ways, it *is* a free chunk of the company.

Think of it like a low-risk bet. The employee is giving up certain things (better salary in a different job, whatever) for the prospect that the fair market value of the stock options they get granted will eventually be much more than the exercise price. Lots of people have got wealthy this way...

[Edit]Damn you RainyDay - snap![/edit]

arcadegame2004 · 14-07-2004 9:30pm

cdebru, you seem to be making out that there is some kind of "either/or" situation with respect to the choice of how to allocate company-profits. Some of the profits can be reinvested while simulataneously reinvested it in the company. It isn't an either/or situation. Just goes to show that you, like many others on the Left, regard profit as negative.

The consumer is the majority. Their interests should come first - yes, even before the perceived interests of the workers in an individual company. That does not mean that companies should have a green-light to treat workers as they please. We already have protection for workers enshrined in law (some of it by this government which you appear to regard as right-wing, e.g. Mary Harney introduced the minimum-wage, something Labour weren't so keen on when in Government though you wouldn't think that now). It is not in the interests of the consumer that the workers of a company providing a service are demoralised, since this can contribute to less productivity.

However, another thing that can contribute to poor productivity is a feeling among trade-union members that the bosses are soft-touches who will grant their every demand every time they go on strike. And unfortunately, workers in some monopolistic state-owned companies have demonstrated that this is their outlook (e.g. EBOA ESB officers union) with their demand for an 18% pay rise, in spite of the average wage of an ESB worker being 57,000 euro (I know this as I heard it on TV3). Now THAT is an unreasonable pay-demand if ever I heard one. The ILDA strike (11 weeks long) a few years ago that disrupted rail-travel is another example of how monopolies embolden union-members within them to make outrageous demands. The costs of granting such demands of course would come back to us, the consumer, who would be forced (as the company is a moinopoly) to pay more to the company in charges.

You only have to look at how far more reason prevails within trade-unions in private-sector companies to see evidence of how much less emboldened their members in such companies are, to back up my point. Let me choose who provides my electricity etc, thank you very much.

cdebru · 14-07-2004 11:30pm

cdebru, you seem to be making out that there is some kind of "either/or" situation with respect to the choice of how to allocate company-profits. Some of the profits can be reinvested while simulataneously reinvested it in the company. It isn't an either/or situation. Just goes to show that you, like many others on the Left, regard profit as negative

i never said it was either or i just pointed out the options for the use of profit
never said it had to only one or the other
nor have i said that i regard profit as a negative
i regard excess profit as a negative
and i dont think essential public services should be run on a for profit basis
but on what is best for the public

as regards to unions as far as i am aware there has not been disruption to esb service due to industrial action since 1991 hardly throwing their weight around are they

and what was the outrageous demand the ilda had do you know look it up
i know what it was and i dont think it was outrageous
can you explain what was outrageous about their demand

in fact in my opinion the reason that strikes seem to be threatened more often in the semi states is that one their services are usually more important to the general public so they gain more media attention
secondly management in these companies are so poor
that they allow situations to develope that would not develope in the private sector
bad decisions by management are not punished as they would be in the private sector
there is cronyism in the appointment on senior management
and boards of directors
i dont think that semi state companies are perfect by any means
but i dont think that privatising them is the answer
proper regulation would be a start with more accountability
and sanctions not just on the company but on individuals management and workers who fail to do their jobs properly

proper management systems
take the appointment of semi state boards away from ministers

by the way i would agree that esb workers looking for a stake in the company is outrageous
they already own it we all own it
and all they are doing is preparing to line their own pockets when it is privatised
they should fight privatisation because it is the wrong thing to do
not because their is not enough in it for them
this kind of greed is short sighted

cdebru · 14-07-2004 11:46pm

You only have to look at how far more reason prevails within trade-unions in private-sector companies to see evidence of how much less emboldened their members in such companies are, to back up my point. Let me choose who provides my electricity etc, thank you very much.

well two things
one if that is true then how come there has been a massive increase in industrial relations disputes in the privatised public transport network in the uk
contrary to what you say the belief is that the unions in these companies feel much more emboldened because they now have not only a public service they can withdraw but a private company tha t cannot afford to leave them out on strike for too long or they will go out of business
unlike when say british rail was a semi state
it was never going to go out of business no matter how long the strike lasted

secondly even in a privatised deregulated electricity market
you will still find your self with a monopoly as we do in the telecoms market
you can choose who you make your calls with but eircom own the lines and you still have to pay them
same will happen the electricity market you might be able to buy your electricity
from joe bloggs
but you will still have to pay the esb for the use of the line
no choice there
i would prefer a properly regulated semi state monopoly to the privately owned
telecom monopoly we have now
with no gaurantees about investment in the infrastructure
and pure profit taking that is going on now

RainyDay · 15-07-2004 8:44am

Those who are believe that privatisation of the ESB would be a good thing should have a read of California Reamin': California and the Power Pirates by Greg Palast to understand how consumers in a privatised market will be ripped off by the providers.

The Corinthian · 15-07-2004 10:57am

Originally posted by cdebru
i regard excess profit as a negative

The problem with your thinking is that you have a very limited grasp of what profit is, in that you base production almost entirely on labour and prefer to rescind or ignore all other possible inputs. What you call excess profit can be the cost to some of those other inputs, most notably risk.

For example an entrepreneur is not going to be interested starting a venture, going into debt, working 16-hour days, paying him/herself a subsistence level salary, not to mention all the stress that comes with it all, just so he/she can be told that he/she cannot make ‘excess profit’. An investor is not going to bother putting a chunk of money into a venture or financial product, if he/she is ultimately going to be told that they should not receive any return over the principle because they did not contribute labour.

So if the entrepreneur and the investor are going to contribute to the economy, one has to consider that if you limit their return, because you consider it to be excessive, then they simply will not contribute and the economy will suffer greatly as a result. As such, when defining what profit and excess profit is, you cannot ignore or rescind the value of such inputs to production, as you have repeatedly done.

and i dont think essential public services should be run on a for profit basis
but on what is best for the public

Sure, let’s just print more money to cover everything :rolleyes:

cdebru · 15-07-2004 1:26pm

The problem with your thinking is that you have a very limited grasp of what profit is, in that you base production almost entirely on labour and prefer to rescind or ignore all other possible inputs. What you call excess profit can be the cost to some of those other inputs, most notably risk.

For example an entrepreneur is not going to be interested starting a venture, going into debt, working 16-hour days, paying him/herself a subsistence level salary, not to mention all the stress that comes with it all, just so he/she can be told that he/she cannot make ‘excess profit’. An investor is not going to bother putting a chunk of money into a venture or financial product, if he/she is ultimately going to be told that they should not receive any return over the principle because they did not contribute labour.

So if the entrepreneur and the investor are going to contribute to the economy, one has to consider that if you limit their return, because you consider it to be excessive, then they simply will not contribute and the economy will suffer greatly as a result. As such, when defining what profit and excess profit is, you cannot ignore or rescind the value of such inputs to production, as you have repeatedly done

i have never said that an entreprenuer should not make a profit on his investment
of time and capital

but i do not agree with excessive profit taking
i dont agree with overcharging and ripping people off
no matter how much risk you took
how many hours you worked
how much stress you have

now you probably believe that if someone is willing to pay a price then that is not overcharging that is not ripping someone off
that s not what i believe
i believe that price should be set with regard to
the full costs and then your profit
i dont expect anyone to provide goods or services
at cost price obviously there has to be profit

the difference in our opinions is that you rescind the value of labour you seem to be of the opinion that risk and capital are the most important inputs into profit
i disagree i think labour is the most important input
that does not mean that nothing else counts and only the cost of labour should be counted that is ridicolous
and i have never said it
i have said that there can be no profit with out labour
but that does not mean that labour is the only cost

Sure, let’s just print more money to cover everything

thats not what i said essential public services should not be run on a for profit basis
that does not mean they should not be run in a cost effective manner with the best possible return for the money spent
if you introduce profit into essential public services then the public service element
because profit becomes the number one goal
the customers of that public service that dont contribute to profit will not be looked after

The Corinthian · 15-07-2004 2:34pm

Originally posted by cdebru
i have never said that an entreprenuer should not make a profit on his investment
of time and capital

Actually, you said that all profit was based upon labour.

but i do not agree with excessive profit taking
i dont agree with overcharging and ripping people off
no matter how much risk you took
how many hours you worked
how much stress you have

And are you to judge what is excessive or overcharging then? The problem with capping prices or profits is that it adversely affects supply - you might think that they’re overcharging, what happens if your subjective opinion is wrong? They won’t overcharge, not because of your cap, but because it’s not viable or worthier their while to stay in that business.

now you probably believe that if someone is willing to pay a price then that is not overcharging that is not ripping someone off
that s not what i believe

That’s touching, but pretty much irrelevant to what defines price and profit.

i believe that price should be set with regard to
the full costs and then your profit
i dont expect anyone to provide goods or services
at cost price obviously there has to be profit

But if you evidently don’t even understand what profit is, how can you determine what is an appropriate level?

Theoretically speaking all profit is bad - what we consider to be profit is in reality the value or cost of risk and capital supplied by the entrepreneur and/or Capitalist. Of course no doubt you would know what this value should be, given your knowledge of every industry in the World.

the difference in our opinions is that you rescind the value of labour you seem to be of the opinion that risk and capital are the most important inputs into profit

Actually, the difference is that you were completely ignoring all other inputs of production, other than labour, when I entered into the discussion with you – which I highlighted and you later partially backtracked on.

i disagree i think labour is the most important input

That really depends upon the product or service. Some are more labour intensive than others and some require greater skills than others. In the case of products, labour is often a minimal input after the initial development of the product.

that does not mean that nothing else counts and only the cost of labour should be counted that is ridicolous
and i have never said it
i have said that there can be no profit with out labour
but that does not mean that labour is the only cost

How many times do I have to quote when you said that “its employees labour that produces profit”? You didn’t say “its employees labour, amongst other things, that produces profit”, did you?

It was a pretty unambiguous statement which you only began to qualify on several posts later and only when you were challenged on it and finally had to concede that you were talking through your arse.

So you did say it, which I’ve had to repeatedly point out to you.

thats not what i said essential public services should not be run on a for profit basis
that does not mean they should not be run in a cost effective manner with the best possible return for the money spent

Does it really mean that? Where exactly did you say “they should not be run in a cost effective manner”? You appear very adept at sweeping generalities that you need to qualify later.

cdebru · 15-07-2004 2:53pm

i have explained this so many times its getting boring
with out labour
there is no profit
i never said that labour alone produced profit

you define labour as manual/ physical activity
i didn't
that was your narrow definition
labour can be manual, physical, mental or a combination
now there can be no profit without labour
labour does not have to involve a third party
an entreprenuer s 16 hour day is labour ass you put it is labour
even your job is labour

now give me an example of profit that does not involve labour of any sort
and dont say interest that s just silly

cdebru · 15-07-2004 2:57pm

Does it really mean that? Where exactly did you say “they should not be run in a cost effective manner”? You appear very adept at sweeping generalities that you need to qualify later

no but your rather childish reply about printing money suggested that!
just tought i would clarify for you yet again
what you call sweeping generalities is an attempt to keep answers short
also becausei dont thave the time to write a full thesis on every answer i give

The Corinthian · 15-07-2004 3:06pm

Originally posted by cdebru
i have explained this so many times its getting boring
with out labour
there is no profit
i never said that labour alone produced profit

And I’ve responded repeatedly that that is not what you originally said. You’ve ignored repeatedly this response and kept repeating your initial denial (which is all it is - a denial).

you define labour as manual/ physical activity

Where do I do that? Feel free to quote the passage.

an entreprenuer s 16 hour day is labour ass you put it is labour
even your job is labour

An entrepreneur, however, is not being paid for that labour. He /she may be paid if the enterprise is successful, and paid well in excess of the hours physically or mentally put in. Indded, if the business fails, he /she will most likely have earned less than zero, as it’s likely that he /she will have business debts to pay off. What the entrepreneur is getting paid for is risk, not labour.

now give me an example of profit that does not involve labour of any sort
and dont say interest that s just silly

Why is it silly, other than the fact that you don’t like the way it fails to fit into your World view?

An investor has capital and invests it. There is little or no labour - any ‘profit’ is as a result of the value of the capital and risk involved.

The Corinthian · 15-07-2004 3:11pm

Originally posted by cdebru
no but your rather childish reply about printing money suggested that!
just tought i would clarify for you yet again

You don’t clarify though - to clarify you would have had to have said it in the first place, which you didn’t (otherwise, feel free to quote where). You qualify - a sure sign of someone backtracking.

what you call sweeping generalities is an attempt to keep answers short
also becausei dont thave the time to write a full thesis on every answer i give

You don’t seem to have a problem with the quantity you post, so having time to write a full thesis on every answer you give is hardly the issue, is it?

Is it time to ban unions?

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