Reply #28: So with Socialism... [View All]

[Loonman]

Okay.

TP company A: hires 1,000 workers, pulls a profit, hires 1,000 more

TP Company B: hires 1,000 workers and wants to compete with company A by producing more TP and selling at a lower price, but skimps on quality. Company B remains solvent because even though people like Company A better, company B produces an acceptable product for less. Company B hires 1,500 more workers to meet demand.

TP Company C: hires a 1,000 workers and decides to automate their assembly line(now I know TP isn't made on an assembly line, but for sake of arguement). Automation saves Company C money so they can make a superior product to company A, and now they can produce TP faster. Company C clinches the market and forces Companies A and B to improve their product, cut the price, or introduce more products.

Company C hires 1,000 workers, company A and Company B hire more workers, market researchers, etcetera




Now, onto centrally planned socialism:


Toilet Paper Company GOVwipe(US Gov subsidized and Nationally owned and run, just like every other TP company in a socialized economy) has one factory producing for all GOVwipe stores. Toilet Paper company GOVwipe has 1,000 workers. Since everyone buys the same paper, there is no need to hire anybody new or produce more TP, because there are no incentives to gain market share. There is no market share, so company GOVwipe produces the same amount of TP per month, at the same price, since people will buy it anyway, regardless of demand. Demand does not need to be met, because the only place you can get TP, anyway is at GOVwipe. Govwipe does not have to make a profit, just meet a quota and pay it's workers a pittance, since there is no demand, now, for skilled TP workers.