So in a major pharmaceutical company, you have a bunch of owners, ceos, managers, workers, lab technicians & researchers.
So let's think about this. The really important people are these researcher and the technicians, they are given projects by the ceo and managers, who want to create profitable drugs, and create some useful but not profitabel with incentives from the government.
These people work for XX amount of dollars on a regularly increasing rate, the money is good, but much of their motivation is benevolence and the humans being's inherent need to create and be skilled.
These people exist in France, UK, and existed in the Soviet Union, as well as currently in Cuba.
Now to complement these people you have the business and distribution channels of the company, that allow business and transaction to occur. These people are necessary because without them these creations would not circulate. Some of these people are driven by the need to be skilled, others are mediocre, just do enough to get their paycheck, but universally I think, these people are not creators or artisans, they are like ants that circulate lumps of sugar on frantically for survival.
Now the other group, the interested owners, and the ceo, these people are the one's who profit from something that the creators make because they want to, and they love to. The creator does not desire the billions that the owners and the millions that the CEO gets, he's obviously satisfied with his hundred of thousands.
So without this CEO and these owners, we can see that these creators will be satisfied as long as they recieve the type of payment they are currently getting. In the Soviet Union, and Cuba, these same creators work/ed for no added benefits other than their drive for benevolence.
If the Government came in and replaced these owners, and assigned a CEO who was paid handsomely to run their operation, you could cut the Oligarchy of owners completely out, and lower costs, and still maintain the same production.
You are missing that Marx used the very same idea to attack capitalism is general and to predict that socialism would defeat capitalism due to its innate superiority because the profit of the oligarchy could be done away with.
You are missing:
Profit as a price signal.
The creative role of the entrepreneur of creating a unique mix of factors of production to create an optimal outcome.
The lack of competition in a socialized system that leads to lack of innovation, lack of pressure on costs.
Constant political pressure in a socialized system.
I think it is a great idea to turn the research and production of pharma over to the govt (basically a company that has no competitors, is not working with its own capital, and never has to show a profit of any sort) TAKE THAT YOU DIRTY CEO'S!!
This is false. It is the cost of research and especially the cost of clinical screening required by the FDA --which averages 10 years or more, and averages 1 BILLION dollars in costs alone-- that drives the cost of drug production up. Marketing, distribution, and sales are minute and no more than other businesses that do not face the same clinical process.
Thus it is not the investors that drive costs up. They are the people that allow the immensely heavy gov't dues to be paid, by ponying up their own cash in the mean time. I believe it is infinitely reasonable for them to expect to profit after sinking hundreds of millions of dollars into overhead.
NO. Fucking no. No no no no no no. The civilian world is in almost every respect more efficient, faster, and more cost effective than the gov't when it comes to running business operations. This is because you compete against other people with different, or even similar, approaches to a problem and you are looking to scoop them. If you cannot scoop them, then the next pressure is to undercut their price point by developing more efficient purification processes/drugs/or production. Gov't does not do this well at all because there is no pressure for innovation without competition.
In all honesty, I'd suggest taking some serious business classes, or at least doing a lot of reading on business operation. There's a LOT to it, even though they're the people that get the brunt of all political rhetoric. There's really not a good way to give a detailed overview in the space of a post IMHO.
Operations management--and business finance management--of large national and international business, which is exactly what the pharma company is, is extremely complicated. As bad a rap as your typical collegiate "business" major gets, the top notch business schools are almost as hard and competitive as law school or med school (yes, I just said that. But look at Wharton before you crucify me, along with a few other programs ).
Believe it or not, I actually run a small business. I want to get a degree in business and finance, and eventually maybe go to Navarra for Grad School, this is after I finish off my comp sci degree by the way.
I think your answer is kind of a cop out, what I'm saying about the pharm companies, is the pharmacists and the researchers make the product, the demand is always gonna be there, so perhaps so much business aspect in this sector is unnecessary.
Turning this into a quasi governmental endeavor would benefit it, you'd probably put an end to all the fake psychiactric treatment our fucked up system profits off of as well.
You can think that all you want. It's not an intentional cop-out. I am a scientist by trade, not a business man. My roommate has a finance degree, and although we've talked about various business and economic subjects and I have grown to appreciate the complexity of finance and operations problems, I would have a hard time giving you an adequately in depth answer simply from my conversations with him.
I am a biochem guy, and I'm telling you that although the product will always be in demand, the research department is incapable of dealing with the 1 billion dollar price tag on its own. Further they need people that are able to guide and communicate, and sell, the idea to the people who will ultimately pay the cost for doing research, in addition to guiding research.
As happens so often in hard sciences, the genius is not the one in charge because he often lacks the ability to communicate his ideas to people with the money to make it happen. A savvy entrepreneur can understand the science well enough to apply it and get investors. Furthermore the scientist most often has no experience or talent at managing the business aspect of a program, which is necessary to smooth operation of research. It is (verrry loosely) analogous to the idea of the "science writer" in mainstream publications--most scientists have a hard time breaking down gritty theory to lay people, but you take a person with good communication skills who can explain the basic theories in terms regular lay people can understand what's going on.
Finally, without the pressure of competition you will never see speedy innovation. This is one of many reasons monopolies are bad (along with the obvious price gouging they allow) and are regulated against. The government is the very definition of monolithic, and as such does not deal well with competition. There is no competition. Or if they are competing against private operations, the private operations will generally win because they are more efficient (witness the human genome project).
Besides which, the gov't does not adhere to budgets well at all. They always spend more than they have, and they always want to spend more. I suppose in the hypothetical event that there were a gov't that adhered strictly to budget demands, did not deficit spend, and treated its income like a multi-national company's, it might be possible to stick the gov't in charge of a private company and do "ok". However, all governments universally violate this requirement.
As such they are the last people I would stick in any position that required a)efficiency and b) rapid --and continued-- innovation. The only exception I can think of is the military, which is exceptionally good at killing things and breaking stuff. Still, the amount of innovation per dollar spent is pathetic, as is the global efficiency of many aspects of the military machine. They may be fantastic at warfare operations, but they are miserable at a wide variety of other tasks that a private company would run much smoother. My roommate is also a captain in the army, and I have heard at many junctures his bitching about various ineptitudes and inefficiencies of the Machine. He could probably write a book about them.
I knew what you were saying from the first. I think your assertion is roughly equivalent to saying that people will always need cars, and the factory workers build the cars, so there is no need for salespeople, dealers, or investors and we should just let the factory workers run the company. Even assuming that people WOULD always demand cars as we know them now, there is a lot wrong with that statement.