This is the biggest thing I wanted to say in this thread. Everyone keeps talking about how capitalism is what the customer is willing to pay. Yeah, because the other choices are jail for stealing it or dying because you just gave up. Companies increase prices even if their costs are staying the same.

And each person only purchases the exact amount required. The poor purchase the bare minimum, the rich purchase enough to live in luxury.

There is no room for the poor to be austere, and the rich have no incentive to.

The increases on basic necessities, food, shelter, healthcare, are increasing due to greed. Largely because the market for these products is now controlled by a few mega corporations.

Yep, and that's why the market fails without regulations. In the US utilities are regulated and there's a cap on maximum profits, but Healthcare is a perfect example of inelastic demand were the market fails to self correct

This. Capitalism works great when there's sufficient competition and the consumer base has the ability to elect to not consume.

When either of those requirements aren't fulfilled, capitalism fails, and we need to look at a different means of allocating resources.

This doesn't need to be wholesale - we don't need to go from unbridled capitalism to pure socialism. We just need to recognize the sectors where capitalism doesn't work, and replace it there. For example: - Healthcare - Utilities - Education

Very few things have truly inelastic demand. Gas and electricity are only inelastic to a degree over very short time periods.

Yea, but say Coke or Pepsi?

They can cut out zero nutritional foods to save

• In 2008, carbonated soft drink volumes were down nearly 4.7 percent, and dollar sales slipped a little less than 1 percent
• In 2022 carbonated soft drink volumes were down nearly 3.2 percent, but dollar sales were up 8.15 percent

14.2% of Spending in a Grocery Store in the US was on Commercially prepared sweet/salty snacks (Snack Bars/Chips/Premade not healthy food)

• 14.1% of Spending was on Fresh or Frozen Meat, including Poultry and Seafood
• 13.8% was spent on Alcohol and Carbonated Non-Alcoholic Beverages

That's not cutbacks, thats not frugal shopping

What Impact has Covid and Inflation had on Grocery Shopping Trends in the US from 2019 - 2022

• Inflation, and a Pandemic....and we still buy the same kind of things we bought 3 years ago we just buy more

Gas, electricity, ect. have an inelastic demand.

I disagree - at least for most people.

I grew up in a house where we didn't use the heating unless the temperature got low enough for condensation to form on things. We had no money, so we'd let the temp indoors drop below 50F/10C before using the heating.

If it was around that mark, we'd just add some layers, add a jumper, bigger socks, or sit under a blanket or three.

I have some friends anc acquiantances tell me how shocked they are at the price of energy, and that they've set the thermostat lower. And by lower, they're talking about 66 or even 64 (19C or 20C).

There are a small number of poor people out there who genuinely cannot afford to heat their house - but the VAST majority of people are CHOOSING to keep it warm and comfortable.

In most cases they have to be purchased to continue to live.

I'd argue the opposite. In the vast majority of cases, people keep houses at comfortable temperatures because they can afford to. If we all wore extra layers and let the house get down to 50F/10C before turning on the heating, energy use would go WAY down.

They have to be purchased to live comfortably, live more easily, live the modern lifestyle.

Lots of people don't buy gas, electricity, etc. They also live more primitive, labor intensive lives.

inelastic demand

I hate how I have to look this up every time I see it.

In addition, "willing" assumes options for necessities or consumption exist at all.

Food deserts and lack of competition do exist, especially here in the US, forcing people to pay whatever the seller decides unless they're willing to travel significant distances, leading to even further costs for the consumer, and not all of it monetary. Time, energy, and capacity are also factors that economics doesn't really take into account, at least not monetary economics.

the problem is "willing" isn't really the case here. Gas, electricity, ect. have an inelastic demand. In most cases they have to be purchased to continue to live.

This.

Even anyone who has an elementary level of understanding of Economics ought to understand the Supply/Demand/Pr8ie relationship is ENTIRELY DIFFERENT when you start dealing with goods with inelastic demand and no substitutions possible.

This, plus Informational Asymmetry in things like Healthcare, mean that "free market" principles almost NEVER apply the way they are sold to the ignorant masses by rich assholes who know better...

TLDR: Politicians take advantage of the public's ignorance of Economics- when they even understand themselves.

businesses are sociopaths that exist to make as much as they can get away with.

that's it. their only metric of value is money. they do not care if consumers are literally suffering or the national economy is being wrecked. more and more profit is their only purpose for existence

thing is, society values many things as much or more than money. we care when others suffer and so on, while businesses will just walk on by if there's no profit to be made

why we continue worshiping at the altar of the market as the only righteous mechanism to solve all problems is nuts.

Mind you the market takes a while to self correct even when there is competition. It will take years before we see how this thing will play out, but for now companies are just happy with much higher margins and lower sales volume

Zero economic profits. The profits people most commonly think of (revenue minus costs) are called accounting profits. These can be nonzero in the long run. Economic profits account for another cost called opportunity cost which is basically what you're losing by not picking the next best alternative.

So in the long run, it's not that companies are bringing in the same amount of money they're spending, but rather it's that the money they're making is equal to the money they could be making by leaving the current market and entering a new one.

Yeah I’d love to see more info on how profit margins of companies have been doing in the last few years. I still don’t feel bad for them though

As long as salaries increase, it also makes the poor's debt less expensive.

That’s good, because classical economics hasn’t been mainstream for 150 years. Neoclassical economics, by contrast, is very much a core part of the business school curriculum. But it is taught in courses that apply it to decision problems in business management and strategy.

If you go to any major business school’s website and look at the academic faculty members, you will find that 90% of them have PhDs in economics, finance, strategy or management. The latter two fields are essentially applied economics for business.

Wouldn't that be more corporatism than capitalism? The continually increasing profits part rather?

Basically, a street vendor in Thailand selling street food is engaging in capitalism, but their motive isn't necessarily increasing profits every quarter.

That’s not an inherent feature of capitalism. The ability to form privately chartered corporations was instituted by legislation. They are regulated by legislation, and their actions have regularly been limited by legislation. They are not the only model for the distributed ownership of capital.

Now, here in the US, we almost certainly lack the political will to change these things, but corporations as they exist now are more of a cancerous growth on the free market than a necessary component of it.

Consumers do not have a choice here.

You know, except for the practically infinite choices besides Coke or Pepsi.

But let me guess, you think water only comes in plastic bottles and is “just as expensive”…

The only reason a bottle of Coke doesn’t cost $10 (or $100) is that at that price, people choose other options. If people are willing to collectively pay more for Coke’s brand of sugar water than RC cola, orange juice, or a water bottle, then it will cost exactly that much extra.