Scot,
Apologies if I misinterpreted your intention. The truth is that I read your long reply to my 8 points, but found myself lost in its details. I also didn’t see an explicit retraction of you original argument that capitalists determine their profit — but, again, there are many moving parts in your reply, so maybe I didn’t understand it properly.
Instead of answering each of your individual points, let me try to digress our view and suggest how it might differ from yours (as I understand it).
Capitalization is given by:
1. K = expected future earnings / discount rate
The right-hand side of this expression can be decomposed into to 4 elementary particles
2. K = (future earnings * hype) / (normal rate of return * risk)
Power-driven capitalists try to augment their differential capitalization (marked by the .d extension) (Note that, because the normal rate is common, its differential value normalizes to 1 and drops from the equation.):
3. K.d = (future earnings.d * hype.d) / risk.d
***
POINT 1. When Eq. 3 is applied to a capitalized entity or group of entities, every element in it represents a distinct aspect of the power of that entity: the future earnings it will receive relative to those of the benchmark, the hype it can create relative to the benchmark, and the risk it can keep low relative to the benchmark, all contribute to its overall capitalized power relative to the benchmark.
From this viewpoint, the differential discount rate (which reduces to differential risk in this formulation) is distinct from differential future earnings and differential hype and therefore has to be treated as only one aspect of power. This conclusion differs from your notion, as I understand it, that, because pricing supposedly relies on discounting, all power can be reduced to the discount rate.
POINT 2. In our view, none of these elementary particles is set exclusively by the entity owners themselves. Instead, these particles are determined by the power conflicts in which the entity is embedded and on which it acts. Thus, differential future earnings, even if greatly influenced by the differential power of the entity, are meaningful only as a conflictual relation with the power of other entities and processes who boost/reduce it (including workers, governments, customers, criminals, culture, wars, etc.). Similarly with differential hype and differential risk, which the entity can alter in one direction but others can change in another.
The result is that capitalized power — which we understand as the quantitative differential representation of many qualitatively different conflicts — is not a top-down dictate of the powerful, but an ever-changing culmination of an ongoing conflict that spans society at large. Capitalists and the entities they own are at the top of the capitalized hierarchy, but their position in that hierarchy as well as the very structure of that hierarchy are constantly changing because power always invites and is exercised against opposition (Ulf Martin’s autocatalytic sprwal).
POINT 3. These considerations might serve to explain why CasP puts so much emphasis on theoretically informed empirical research. Without such research, we cannot decipher — and simplify — the complex trajectories of differential capitalization nor understand the underlying qualitatively different processes that drive those trajectories. Without this deciphering and understanding, our equations and theories remain empty shells at best and misleading corps at worst.