The produce of the world could not attain anything approaching to its present amount, nor support anything approaching to the present number of its inhabitants, except upon two conditions: abundant and costly machinery, buildings, and other instruments of production; and the power of undertaking long operations and waiting a considerable time for their fruits. In other words, there must be a large accumulation of capital, both fixed in the implements and buildings, and circulating, that is, employed in maintaining the labourers and their families during the time which elapses before the productive operations are completed and the products come in. This necessity depends on physical laws, and is inherent in the condition of human life; but these requisites of production, the capital, fixed and circulating, of the country (to which has to be added the land, and all that is contained in it), may either be the collective property of those who use it, or may belong to individuals; and the question is, which of these arrangements is most conducive to human happiness. What is characteristic of Socialism is the joint ownership by all the members of the community of the instruments and means of production; which carries with it the consequence that the division of the produce among the body of owners must be a public act, performed according to rules laid down by the community. Socialism by no means excludes private ownership of articles of consumption; the exclusive right of each to his or her share of the produce when received, either to enjoy, to give, or to exchange it. The land, for example, might be wholly the property of the community for agricultural and other productive purposes, and might be cultivated on their joint account, and yet the dwelling assigned to each individual or family as part of their remuneration might be as exclusively theirs, while they continued to fulfil their share of the common labours, as any one’s house now is; and not the dwelling only, but any ornamental ground which the circumstances of the association allowed to be attached to the house for purposes of enjoyment. The distinctive feature of Socialism is not that all things are in common, but that production is only carried on upon the common account, and that the instruments of production are held as common property. The then of Socialism, on the scale of Mr. Owen’s or M. Fourier’s villages, admits of no dispute. The attempt to manage the whole production of a nation by one central organization is a totally different matter; but a mixed agricultural and manufacturing association of from two thousand to four thousand inhabitants under any tolerable circumstances of soil and climate would be easier to manage than many a joint stock company. The question to be considered is, whether this joint management is likely to be as efficient and successful as the managements of private industry by private capital. And this question has to be considered in a double aspect; the efficiency of the directing mind, or minds, and that of the simple workpeople. And in order to state this question in its simplest form, we will suppose the form of Socialism to be simple Communism, equal division of the produce among all the sharers, or, according to M. Louis Blanc’s still higher standard of justice, apportionment of it according to difference of need, but without making any difference of reward according to the nature of the duty nor according to the supposed merits or services of the individual. There are other forms of Socialism, particularly Fourierism, which do, on considerations of justice or expediency, allow differences of remuneration for different kinds or degrees of service to the community; but the consideration of these may be for the present postponed.
The kind of policy described is sometimes possible where, as in the case of railways, the only competition possible is between two or three great companies, the operations being on too vast a scale to be within the reach of individual capitalists; and this is one of the reasons why businesses which require to be carried on by great joint-stock enterprises cannot be trusted to competition, but, when not reserved by the State to itself, ought to be carried on under conditions prescribed, and, from time to time, varied by the State, for the purpose of insuring to the public a cheaper supply of its wants than would be afforded by private interest in the absence of sufficient competition. But in the ordinary branches of industry no one rich competitor has it in his power to drive out all the smaller ones. Some businesses show a tendency to pass out of the hands of many small producers or dealers into a smaller number of larger ones; but the cases in which this happens are those in which the possession of a larger capital permits the adoption of more powerful machinery, more efficient by more expensive processes, or a better organized and more economical mode of carrying on business, and thus enables the large dealer legitimately and permanently to supply the commodity cheaper than can be done on the small scale; to the great advantage of the consumers, and therefore of the labouring classes, and diminishing, that waste of the resources of the community so much complained of by Socialists, the unnecessary multiplication of mere distributors, and of the various other classes whom Fourier calls the parasites of industry. When this change is effected, the larger capitalists, either individual or joint-stock, among which the business is divided, are seldom, if ever, in any considerable branch of commerce, so few as that competition shall not continue to act between them; so that the saving in cost, which enabled them to undersell the small dealers, continues afterwards, as at first, to be passed on, in lower prices, to their customers. The operation, therefore, of competition in keeping down the prices of commodities, including those on which wages are expended, is not illusive but real, and, we may add, is a growing, not a declining, fact.
Because an endowment is a public nuisance when there is nobody to prevent its funds from being jobbed away for the gain of irresponsible administrators; because it may become worse than useless if irrevocably tied up to a destination fixed by somebody who died five hundred years ago; we ought not on that account to forget that endowments protected against malversation, and secured to their original purpose for no more than two or three generations, would be a precious safeguard for uncustomary modes of thought and practice, against the repression, sometimes amounting to suppression, to which they are even more exposed as society in other respects grows more civilised. The fifty or hundred years of inviolability which I claim for them, would often suffice, if the opinion or practice is good, to change it from an uncustomary to a customary one, leaving the endowment fairly disposable for another use. Even when the idea embodied in the endowment is not an improvement, those who think it so are entitled to the opportunity of bringing it to a practical test. The presence of such attempts to promote the general well-being by means diverging from the common standard, keeps discussion alive, and obliges the prevailing opinions and customs to seek support from their own merits, and not from a blind acceptance of existing facts.
What tempts people to see with complacency a testator’s dispositions invalidated, is the case of what are called eccentric wills—bequests determined by motives, and destined for purposes, with which they do not sympathise. And this propensity to count the wishes of the owner of the property for little or nothing, when they are unlike those which we think we should ourselves have had in his place, does not stop at public endowments, but extends to any large bequest in favour of an individual, which departs ever so little from the common practice of the common world. But does not this genuine intolerance of the majority respecting other people’s disposal of their property after death, show how great is the necessity for protection to the rights of those who do not make resemblance to the majority their rule of life? A case of bequest which has been much noticed in the newspapers, and of which it is still uncertain whether it will be allowed to take effect, strikingly exemplifies this need. A person left a sum of money by will to found an hospital for the treatment of the diseases of the lower animals, particularly birds and quadrupeds. He made the mistake of appointing as trustee for the purposes of the endowment, the University of London—a body constituted for special objects, and which could not with propriety undertake a duty so remote from the ends of its appointment. But can it be pretended that an hospital such as was designed by the testator, would not be a highly useful institution? Even if no regard were due to the animals themselves, is not the mere value of many of them to man, and the light which a better study of their physiology and pathology cannot fail to throw on the laws of animal life and the diseases of the human species, sufficient to make an institution for that study not merely useful, but important? When one thinks of this, and then considers that no such institution has ever been established in Europe; that a person willing to employ part of his superfluities in that way, is not born once in several centuries; and that, now when one has been found, the use he makes of what is lawfully his own is a subject of contemptuous jeering, and an example held up to show the absurdities of testators, and the folly of endowments; can one desire a more conclusive evidence of what would happen if donations for public purposes were only valid when the purposes are consonant to the opinion of the majority? Who knows if even the Cornell University, with its “eccentric” provision that every student attending the University must work bodily for his living, would at present have been more than a project, if its realisation had depended on the will of the Government, or of an authority accountable to the majority?
Not quite. I did not express any opinion as to the possibility of making more than one rate of exemption. I have not made up my mind, practically, as to whether it is better to have several scales, or only one. But what I brought forward those considerations for, was to point out that the claims were much stronger, the necessity for saving being much greater, in some cases than in others; and my object was, not so much to recommend the application of different scales to those different cases, of which I am not able to judge sufficiently to have a decided opinion, but rather to show that, provided you could relieve the cases in which the claims were strongest, you need not so much mind not being able to relieve those in which they were much weaker; that the fact that you would perhaps be obliged to demand a little more from those who still have some claim to exemption, is not a conclusive objection to giving relief to those whose claims are much stronger.
In this chapter we empirically study how firms, which play an increasingly significant role in retirement savings, set their contributions to employees’ savings accounts, and analyze whether employer contributions reflect employees’ savings preferences.
Using a reform that decreased the subsidy for contributions to capital retirement savings accounts for Danish workers in the top income tax bracket, we find strong evidence that firms set contributions to employer-provided savings accounts in accordance with their employees' savings preferences.
Given that he will need $19,945 to retire, he will receive that money in one installment, thus sustaining him in the short run. The small capital stocks will also accrue benefits in the short run. He will also be getting returns of $1000 every month. However, it is essential for him to invest in long term investments given that he is a young man. Large scale long term investments have a high rate of returns. Never the less, they are risky. It is clear that Growth funds have the highest potential reward, as well as risk. Growth and income is second, followed by equity income, then the balanced fund and eventually the bond fund. As a young person, he should aim at gaining the highest returns to ensure that his retirement savings keep growing, and remains ahead of his inflation rate.
When he grows old, he shall invest in less risky investments to protect his savings. What he has already saved. That accounts for his 50% investment on large capital stocks, 20% foreign stocks and 10% on bonds. Basing my argument on the amount of funds he would require to retire, I advise that he invests his retire savings with IRAs. These are Individual Retire Arrangements. The Roth IRAs particularly are the best. My opinion is because of the benefits that those who join these organizations gain, that others do not get.
And, I realized, few people in their position do. Local executives for hospitals and clinics and home-health agencies understand their growth rate and their market share; they know whether they are losing money or making money. They know that if their doctors bring in enough business—surgery, imaging, home-nursing referrals—they make money; and if they get the doctors to bring in more, they make more. But they have only the vaguest notion of whether the doctors are making their communities as healthy as they can, or whether they are more or less efficient than their counterparts elsewhere. A doctor sees a patient in clinic, and has her check into a McAllen hospital for a CT scan, an ultrasound, three rounds of blood tests, another ultrasound, and then surgery to have her gallbladder removed. How is Lawrence Gelman or Gilda Romero to know whether all that is essential, let alone the best possible treatment for the patient? It isn’t what they are responsible or accountable for.
I perform multiple robustness checks on these findings, including estimating propensity score matching models and tests for potential confounding factors such as changes in retirement accounts' returns or fees, or changes in workers' income.