Blurts & Spasms

Here is a previous answer to this question that covers most of the basics, describing how much of the innovation that capitalism often takes credit for has actually occurred in non-profit environments (academia, government research, unpaid internships, hobbyists inventors inventing for the pleasure of doing so, etc.):

https://www.tcollinslogan.com/tclblog/index.php?/archives/380-Socialists-How-would-you-deal-with-the-incentive-problem.html

More generally, human beings are not primarily motivated by greed — and, even when they are, other complex motivations are also in play. The fans of “market fundamentalism” really do believe a desire for material gain and security dominates human behavior and choices…but that simply is contrary to all research on our intrinsic motivation (see link below). But a romantic view of the profit motive bolsters their blind enthusiasm for capitalism, and distorts how market fundamentalists understand all causality in human systems.

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5364176/

In reality, most innovation throughout human history — and even during the rise of capitalism — has been a product of natural desires in human beings to imagine, problem-solve, impress others, or just be clever. In fact, nearly all of the most impactful innovations in the 200 years have been a result intrinsic, non-materialistic motivations (Edison’s invention of the light bulb and phonograph; Einstein’s theory of relativity; Marie Curie’s work on radioactivity; the Atanasoff–Berry computer; and so on). That’s who we are as a species. The linked Quora answer above covers some of the more recent examples of this natural tendency to innovate without profit, but any student of anthropology, archeology, or history can educate folks about how amazingly innovative human beings have always been…long before making a profit was a factor.

“One might think that the money value of an invention constitutes its reward to the man who loves his work. But speaking for myself, I can honestly say this is not so…I continue to find my greatest pleasure, and so my reward, in the work that precedes what the world calls success.” —Thomas Edison

Does the profit motive actually incentivize innovation at all? That’s a very interesting question. What the profit motive seems to be really good at is incentivizing efficiencies and cost savings in production and distribution — and in developing new ways to persuade people to buy new things, whether those those things are useful or have any intrinsic value. In other words, capitalism has a knack for inventing value out of thin air, and then convincing consumers the invented value is real. It also is pretty good at recognizing the profit potential of other people’s inventions, capitalizing on the ideas of those not motivated by profit, and then taking credit for the innovation.

In any case, consider the consumer fads that have driven the most massive surges in sales in the U.S. — are any of the clothing, toys, electronic gadgets, convenience appliances, etc. all that innovative? Not really…they just become popular because they are the “latest and greatest” version of something that everyone is persuaded by advertising they “must have.” This lemming effect of keeping up with artificially induced popular demand drives a lot more sales than actual innovation. So in terms of what is being produced, advertised, and sold, most new ideas in the commercial marketplace are a lot more focused on convincing people they need something they really don’t.

In addition, many mature industries aggressively resist innovation — because a truly disruptive new idea will undermine their profit. This is why ExxonMobil spent millions to spread doubt about both climate science and the feasibility of alternative energy production. In fact, this practice of disinformation to keep innovation from occurring has been a massively funded and well-coordinated activity of big business for many decades. See this web page for examples:

https://level-7.org/Challenges/Neoliberalism/Attacks_On_Science/

As much of the low-hanging fruit of substantive innovation and market disruption has already occurred across many industries over the past 50–100 years (i.e. how many new, meaningful variations of “toaster” or “hair dryer” or TV can their really be…?), profit-driven product and service innovation increasingly tends to put new veneers on old ideas — just asserting that something has new value when it really doesn’t, or making sure consumers have to replace what they buy on a regular basis. This is one reason we see the durability of all goods plummeting even as their prices soar.

So this is how the profit motive works in the real world, and how its linkage with real innovation is tenuous at best. Don’t be fooled by the market fundamentalist propaganda.

Lastly, regarding socialism. First, here is a link on the different types of socialism…and how they are not at all cookie cutter replications of Marxism-Leninism as the anti-socialists would like you to believe:

https://www.tcollinslogan.com/tclblog/index.php?/archives/618-What-are-the-different-types-of-socialism.html

But even in the case of Soviet era communism, there was a lot of innovation and productivity occurring in the U.S.S.R. As “inefficient” as the anti-socialists want us to believe the Soviet model was, it produced some astonishing innovations that the capitalist world came to rely upon. As just one example, the Soyuz rocket has the longest, most reliable track record of delivery supplies and personnel to space — including the International Space Station.

https://www.space.com/40282-soyuz-rocket.html

But Soyuz was just the tip of the iceberg. The Soviets were actually pretty damn innovative, and their inventions had a measurable influence on the rest of the (capitalist) world. Here is one quick overview:

https://www.worldatlas.com/articles/10-greastest-inventions-made-by-the-soviet-union.html

So again…don’t be fooled. The truth is always more nuanced than the (unfortunately numerous and widespread) pedantic declarations of the brainwashed and the ignorant. Just because something gets repeated over and over again doesn’t mean it’s true…but the market fundies (right-libertarians, fans of Ayn Rand, neoliberals, neoconservatives, etc.) often fall victim to this illusory truth effect.

https://en.wikipedia.org/wiki/Illusory_truth_effect

My 2 cents.