Re: What, exactly, is Apple's iPod business model?

On Sep 6, 11:56 am, "arvim...@xxxxxxxxxxxxx" <arvim...@xxxxxxxxxxxxx>
wrote:
spinoza1111wrote:
On Sep 4, 11:37 pm, Jeffrey Goldberg <nob...@xxxxxxxxxxxx> wrote:
On 9/4/07 12:20 AM,spinoza1111wrote:

On Sep 4, 12:50 pm, Jeffrey Goldberg <nob...@xxxxxxxxxxxx> wrote:
It's working out much better than the alternative.
How would you know that?
I lived in Hungary for six years including during the tail end of socialism.

A thug takeover supported by the Soviet army wasn't "socialism".

It is too easy an escape to say that Soviet socialism really "wasn't
socialism." It was started by serious socialists and fell prey to a
weakness of socialism in all socialist countries: socialism empowers
bureaucracy without adequate checks and balances. Soviet socialism and
socialist evangelism went way off the tracks, but it started on the tracks.

Hayek's 1944 claim, that socialism always and of necessity engenders
bureaucracy was immediately belied by the creation of the National
Health in Britain, that showed that large portions of an economy can
be socialised without excess bureaucracy. Hayek also never foresaw the
ability of computers to manage an economy or a segment of an economy:
it is a well-kept secret, for example, that the market-exogenous push
for computerization in the 1960s in the USA came from Lyndon Johnson's
"Great Society" plans.

Hayek generalized overmuch from the Soviet model. He argues that
actually existing socialism (1) generates an excessive need for
coordination and control, and, further, that (2) self-seeking behavior
continues under socialism and undercuts its goals. He argues (3) that
nothing is better than a market system for efficient allocation of
resources.

In response to (1), this is true in a rigid Stalinist system but false
for most other socialistic systems which use the market to allocate
while regulating its limits: this experimentation, known as "New
Economic Policy" (NEP) under Lenin, caused a rapid Soviet recovery in
the 1920s while preserving the gains of socialism (universal
employment, education, health care and housing in a Russia ruined by
the Czarist war), and it was used by Deng Xiao Peng in the 1980s to
advance China at the fastest rate of growth world wide (but, Deng also
removed the "iron rice bowl").

In response to (2), planners need only to calculate at the micro-
economic level the costs and benefits of corruption.

(3) is just false as soon as the base of the market superstructure is
subject to market pressures: if people can't, for example, get potable
water, they spend all their time in ensuring this access and cannot
participate in a market. If (as Mohamed Yunis, the founder of
microcredit banking, shows in his book on microcredit) poor women have
access to non-Islamic, usurious credit, they are never able to save a
dime; Yunis has a solution he thinks is free-market, but actually
depends on lender self-restraint and communitarian values in a
socialistic way.

What Hayek saw to be efficient allocators of resources were developed
markets with a critical mass of infrastructure constructed by
"socialistic" government meddling, exclusive of colonial
infrastructure construction in the interest exclusively of
metropolitan business. Thus the ante-bellum US government subsidies of
canal and then railroad investment, canal and railroads being
constructed from and to locations (such as Chicago, and the Illinois
river leading to the Mississippi river and the world) that served the
people of the US, created the "free market" of the first Gilded era:
thus the investment in mainframe computers, subsidized by the military-
industrial complex, created the free market in micros, software and
the internet of the second Gilded era (Gilded that is for the rich)
that started in the 1980s.

Whereas "primitive" societies without any infrastructure, or societies
with a distorted (but essential) infrastructure created without regard
to the needs of its people (such as the Congo with railways between
diamond mines and navigable rivers even today) can never use the
market as Hayek's resource allocator.

Even admirably functioning Scandinavian socialism engendered so much
nannying, that right-wing parties regularly defeat socialists. I think

Oh? Then why is the "nanny" state still in power in Scandinavia? Sure,
rich fat cats create in the privatized media the appearance of
grassroots resistance to the nanny state, and males disaffected by the
enhanced position of women in "nanny" states are regularly suckered
into believing them. But somehow the National Health in Britain, and
high taxes and social welfare in Sweden, remain.

only mixed socialism and capitalism function in enough competition to
keep each party aware of its weaknesses and ready to bridle some misconduct.

So why is this never tried in the leading capitalist country, and why
does that same country export its ideology at gunpoint (Chile 1973)?






Yes. Although it goes against what I know of economic theory, it does
work far better than the broken system in the US. It is true that there
are long waits and "rationed" services, but those issues are no worse in
Britons deny this.
I suppose that if you select your Britons very carefully you can try to
maintain your claim. I also lived in the UK for six years. My daughter
was born there.

I always choose my friends with care. Look, any economist will tell
you that queues and rationing are what you get when you limit the free
market. The problem (as even Adam Smith seems to have known) with the
complete free market operating within a sphere of human endeavor is
that in place of queues and rationing you get access into
"unity" (right this way, Mr. Creosote, no waiting in line) and
"zero" (hey, Gomer, get out of my emergency room).

Most people worldwide choose some queueing and some (nonmarket)
rationing in health care, even in the free-market paradise of Hong
Kong, because the demand for health care, operating as it does at the
horizons of life, has a different and unique combination of elasticity
(more Botox for Mr. Creosote) and inelasticity (thanks, but one enema
will do just fine).

And uncontrolled socialism, especially in poor countries like Russia,
empowers bureaucrats, who arrogate to themselves the best fruits of

Bureaucracy has always flourished in Russia for cultural reasons, and
today it is returning to bureaucracy (rule in fact by the KGB) without
any "socialistic" provisions at all. Don't blame socialism.

education and health service. And it also empowers nepotism, so the

Capitalism doesn't? FYI, most of the fortunes of the 1980s were made
by men such as Donald Trump and Fred (Federal Express) Smith who had
rich Daddies and didn't have to work at a paying job: they could
"follow their dream". Gates' own father was a successful corporate
lawyer who decided to bankroll his son after the latter dropped out of
Harvard University. Countless other men developing better systems fell
by the wayside because they had to work at paying jobs.

families of bureaucrats are first in line for education and health
services. And "President-for-Life" is a title more the rule than the
exception in most socialist countries outside of Western Europe, to say
nothing of hereditary monarchy in North Korea and Cuba. I don't know of
any reigning and ruling "Presidents-for-Life" in developed capitalist
countries (constitutional but powerless monarchs don't count), although
capitalist governments do find amenable "Presidents-for-Life" in
exploiting undeveloped countries.

Badoopsa badopsa: so, el Jefe Maximo Presidente can't be blamed in
socialism.

Cuba doesn't have anything like an hereditary monarchy. Raul has taken
over because a free election would be fucked over by the CIA and the
rich emigres.






But this helps illustrate my approach. I'm relying on experience to
tell me whether markets in general work better than socialism. With
socialized medicine, socialism works better in my experience (even
though I'm not sure why). In just about every other domain socialism
works worse (and I have pretty good ideas about why).
How would you know?
Does one have to have direct experience of something to have a well
reasoned opinion? As it happens, I do have some limited experience of
socialism.

Nicaraguan and Hungarian. The former under continual United States
pressure, in effect a war socialism (the United States was convicted
of a violation of international law in its 1986 mining of Nicaraguan
harbors, as you know). The latter a murderous takeover and mirror
image, in the execution of Imre Nagy after the popular and anti-Soviet
revolution of 1956, of Chile 1973: a country which the "great" powers,
including the US, allowed to be bullied so they could have the
identical free hand in their own spheres: to bully in such a way that
inspires, indirectly, the behavior in this thread.

The Hungarian revolutionaries of 1956, 1968 and even 1989 were NOT
demonstrating for the right to be a source of cheap labor and guest-
house operators. They were, for the most part, demonstrating for
democratic (and therefore Scandinavian/British style) Fabian socialism
in each of those years.

There has been a considerable waffling between right-wing and moderate
socialist government, including reformed Communists on both sides, in
most Eastern European countries.

Cuba is no more free of geography than Finland. Fidel Castro has praised
the virtues of Albania's Enver Hoxha, North Korea's Kim Il-sung, and
Libya's Muammar Qaddafi, and the United States is under no moral or

So? The United States praised Saddam Husayn when it fit its goals to
do so.

legal obligation to trade with any government that picks its friend by
their degree of enmity to the United States. If Finland has to conform
itself to Russian pressure, Cuba will eventually have to recognize that
it can only prosper by living peacefully with its demanding neighbor.

It would like to. The problem is that ever since the Mexican war, the
United States has made it plain under the Monroe Doctrine that it will
overthrow Latin American governments that don't follow its lead.


However good the Cuban education and health care system is now, its
economic system was tops in Latin America before Castro and now ranks

Now, that's just bull***. Cuba was a mobbed-up under Batista, and its
people suffered from malnutrition, lack of access to potable water,
disease, and lack of education at the levels of el Salvador. American
tourists were getting blow jobs from Cuban girls desparate to pay the
rent, and starving Cubans performed sex acts on stage for money. Its
peasants were dispossessed of their land whenever US funded
businessmen wanted that land.

with Haiti; evenly distributed poverty is no more of an accomplishment

Poverty is strictly speaking not having enough to sustain life, and
this doesn't exist in Cuba. It does exist in the USA.

than ill-distributed prosperity was for Batista.

Actually, I am in sympathy with socialism and Canadian socialized
medicine, but I am no admirer of self-absorbed Presidents-for-Life. And
I am still using my second-generation iPod, because it still works after
several years, and I have no problem playing classical music downloaded
from the iTunes store and mostly from my favorite cd's. I plan to buy a
new one in good time. Our anecdotal experience differs here, too.

...

---

Yours for on-topic discussion,

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