Economics and Other Stuff
written by Martin Shkreli
things i've written or find interesting pertaining to various arts including philosophy, religion (more specifically me defending christianity and attacking atheism), philosophy and politics.
Last Updated
05/31/21
Chapters
1
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515
Economic Hierarchy and It's Necessity
Chapter 1
The idea of hierarchy within the work place (such as bosses, managers, etc) are viewed with a negative connotation throughout Marxism. They view the classes as relationships based on private ownership as something to avoid. A class defines groupings of individuals with shared life situations, thus interests and classes are naturally antagonistic. Marxists see those that own the productive assets have power over those who do not. The bourgeoisie and the proletariat, a cycle forever repeating throughout all of human history as seen by Marxists. So Marxists see that the capitalist has the authority over the proletariat regarding decisions relating to the productive enterprise. This is where the conception of hierarchy arrives. The question is this: Is it correct? And if so, is it justified?
At the base, there are the managers. Marxists see them as inhibiting the efficiency of the workers, but it makes no sense for them too. They usually go through years and years of vocational training and schooling to attain the necessary human capital in order to do their jobs. Since running a firm typically requires fast decision making, people that make those decisions need to be the most qualified to make them, otherwise, you risk mismanagement of capital, overstocking, shortages, angry workers, falling profits, etc, etc. Since these decisions need resources (labor) to be enacted, the decision by the manager or whoever inevitably means that a worker or workers are going to need to follow to plan. To eliminatee this input by the higher-ups will, in fact, lead to inefficiency.
Most Marxists have no issue with managers however, but rather CEOs, Boards of Directors, etc. To them, the CEOs offer nothing of value to the company, and the labor they do is much less deserving of the pay than lets say the people working for the CEO. The problem we see here is the assumption of idle management. The thing is that the Boards of Directors and CEOs are infact workers and have years of experience and loads of human capital in order to run. To be BOD member you should have a background in finance, law, economics, business,, etc. Most BOD members have been in business for more than half of their whole life. BODs:
1.) Review and evaluate present and future opportunities, threats and risks in the external environment and current and future strengths, weaknesses, and risks relating to the company.
2.) Determine strategic options, select those to be pursued, and decide the means to implement and support them.
3.) Determine the business strategies and plans that underpin the corporate strategy. Ensure that the company's organizational structure and capability are appropriate for implementing the chosen strategies.
4.) Delegate authority to management, and monitor and evaluate the implementation of policies, strategies, and business plans.
5.) Determine monitoring criteria to be used by the board.
6.) Ensure that internal controls are effective.
7.) Communicate with senior management.
8.) Fiduciary duty to protect the organization's assets and member's investment. The board has a fiduciary responsibility to represent and protect the member's/investor's interest in the company. So the board has to make sure the assets are kept in good order. This includes the company's plant, equipment, and facilities, including the human capital (people who work for the company)
9.) And much, much more.
The Marxian conception of hierarchy assumes idle management when in reality hierarchy allows for above average inputs and competitive specialization.
At the base, there are the managers. Marxists see them as inhibiting the efficiency of the workers, but it makes no sense for them too. They usually go through years and years of vocational training and schooling to attain the necessary human capital in order to do their jobs. Since running a firm typically requires fast decision making, people that make those decisions need to be the most qualified to make them, otherwise, you risk mismanagement of capital, overstocking, shortages, angry workers, falling profits, etc, etc. Since these decisions need resources (labor) to be enacted, the decision by the manager or whoever inevitably means that a worker or workers are going to need to follow to plan. To eliminatee this input by the higher-ups will, in fact, lead to inefficiency.
Most Marxists have no issue with managers however, but rather CEOs, Boards of Directors, etc. To them, the CEOs offer nothing of value to the company, and the labor they do is much less deserving of the pay than lets say the people working for the CEO. The problem we see here is the assumption of idle management. The thing is that the Boards of Directors and CEOs are infact workers and have years of experience and loads of human capital in order to run. To be BOD member you should have a background in finance, law, economics, business,, etc. Most BOD members have been in business for more than half of their whole life. BODs:
1.) Review and evaluate present and future opportunities, threats and risks in the external environment and current and future strengths, weaknesses, and risks relating to the company.
2.) Determine strategic options, select those to be pursued, and decide the means to implement and support them.
3.) Determine the business strategies and plans that underpin the corporate strategy. Ensure that the company's organizational structure and capability are appropriate for implementing the chosen strategies.
4.) Delegate authority to management, and monitor and evaluate the implementation of policies, strategies, and business plans.
5.) Determine monitoring criteria to be used by the board.
6.) Ensure that internal controls are effective.
7.) Communicate with senior management.
8.) Fiduciary duty to protect the organization's assets and member's investment. The board has a fiduciary responsibility to represent and protect the member's/investor's interest in the company. So the board has to make sure the assets are kept in good order. This includes the company's plant, equipment, and facilities, including the human capital (people who work for the company)
9.) And much, much more.
The Marxian conception of hierarchy assumes idle management when in reality hierarchy allows for above average inputs and competitive specialization.