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[Mykl:] This is actually the exact problem in the US at the moment. Money is trickling to the top and not making its way back down. Those at the top are hoarding it, thus keeping it out of, and slowing, the economy. This in turns damages the businesses that they own, because their customers can't afford to spend money that they don't have.
The problem would be largely solved by handing out a bunch of cash to employees, who will use it to go out and spend, stimulating the economy and generating demand (thus improving the outlook of business). It would actually be a win-win, but the cash hoarders can't see beyond having the biggest number in the bank they can (which they'll never spend).
The big thing missed is that due to inflation, hoarding money means losing money. Rather than wonder why businesses aren't hiring people or building up capital right now, Mykl merely suggests that the business give away that money to create a little short term economic activity and something that will be better than the present state of affairs while ignoring that the business has just thrown away its cheapest means to expand and employ more people. Later on in the same thread, we have this gem:
[deimtee:] I think this is actually becoming one of the major problems, especially on the small end of the investment scale. At some point, the economy is producing enough to feed, house, and entertain everyone without requiring anywhere near enough human work to keep everyone employed.
Investing in a new business requires identifying an under-filled need in order to attract customers. It is getting to the point where starting a new business means competing with a giant company, it is just not viable unless you can come up with something that is both truly new and valuable. Not many people can do that, and every time one does there is one less opportunity left. At the same time, big companies are streamlining and using automation and economies of scale to reduce the number of employees.
The solution, of course, was to shrink the labor market, not fix the problems described above.
[khallow:] Deliberately shrinking the labor market won't identify under-filled needs nor create more small and medium sized businesses.
[deimtee:] The labour market is currently over-supplied. This is evidenced by the difficulty young people have in entering it. Raising the retirement age is like eating your seedcorn. By the time those geriatrics are finally knocked off by COVID 2040 or something society is going to hit a wall where no-one knows how to do the jobs. 30 year-olds on unemployment for 10 years are not ideal trainees and no trainers will be around anyway. Early retirement forces the companies to train the next generation now.
Yes we should be massively investing in life-extension, medical research, space, all that stuff. Now what percentage of people do you think can realistically contribute to that sort of endeavor? I would say less than 1% of people have the capability to undertake research at that level.
Notice the insistence on shrinking the labor market even when presented with clear evidence that we need that labor for hard, open-ended problems and to preserve institutional knowledge. In the recent story, Kill the 5-Day Workweek (which was about some business that does 4 day workweeks), we see more examples of this dysfunctional reasoning in action. There's anecdotes about bad bosses, insistence that economies is less rigorous than physics, and lots of fantasizing about all the amazing things you'd do, if your employer was forced to give you one more day off. Let's start with the "bullshit jobs":
[Thexalon:] Counterpoint: A lot of jobs are completely useless and exist for basically bullshit reasons. If you've ever worked in a larger corporation or non-profit, you will have no difficulty identifying a bunch of Wallys or Peter Gibbonses walking around who are accomplishing absolutely nothing but vaguely looking like they might be working. And no, that's not limited to government, because despite what a lot of libertarians seem to think private corporations are not even close to perfect models of efficiency.
To summarize the above link, some clueless idiot doesn't understand a variety of jobs. So those jobs must not have a reason for being and are thus "bullshit jobs". Notice that once the author has failed to understand the purpose of these jobs, he then has to come up with a conspiracy theory for why they exist.
[author David Graeber:] The answer clearly isn't economic: it's moral and political. The ruling class has figured out that a happy and productive population with free time on their hands is a mortal danger (think of what started to happen when this even began to be approximated in the '60s). And, on the other hand, the feeling that work is a moral value in itself, and that anyone not willing to submit themselves to some kind of intense work discipline for most of their waking hours deserves nothing, is extraordinarily convenient for them.
Who here really thinks that Joe Billionaire is going to burn money on that?
Then there's the fantasizing about how shortening the workweek and the amount of work per job won't have any impact on competition from other countries.
[AC1:] A lot of Asian companies still work on Saturday (6 day week ). If going to a 4 day workweek in any way hurts productivity these Asian firms will have an advantage
[AC2:] Ridiculous, and already proven wrong since they are open an extra day already and haven't taken all the business.
"Proven wrong" because those Asian companies haven't eaten entirely our lunch. We still have some left. Funny how half a century of off-shoring can be ignored.
Moving on, it wouldn't be complete without a contribution from the peanut gallery. fustakrakich continues his bid to destroy Western civilization:
[fustakrakich:] Also demand a six hour work day. Make each day a little less tiresome
Here's my take on all this. It's basically a supply and demand problem in the developed world. Due to labor competition from the developing world, developed world labor has lost much of its pricing power. For some reason, most of the above posters think we can get back to higher labor prices by reducing the supply of labor. What's missing from that is that the developing world is still increasing its supply of labor (more from building out trade/transportation infrastructure to populations than from birth rate). Those moves won't actually reduce labor supply as a result.
Instead, let's increase the demand for labor. Rather than rhetorically ruling out the creation of new businesses and such, how about we enable those things to happen. Because plenty of new businesses still happen - indicating the narrative is faulty.
But that would mean acknowledging that protecting labor is less important than nurturing business growth and creation. Who will do that?
(Score: 0) by Anonymous Coward on Thursday June 24 2021, @06:22AM
There's something I think many people don't really appreciate.
Let's take every single item sold in a year, every single service, every single "thing". Add up its commercial value to get a gross sum of all the money generated. And now let's divide that evenly between everybody. What would it be? Many who don't know what I'm describing might expect this answer to be millions of dollars, after all - how else can we have people with tens of billions of dollars? In reality, it's of course nowhere near. All I've described is the GDP/capita. It's currently only $65,298. That is with the endless games, worthless products and services, and a literally life-or-death coercion to bring that figure as high as you possibly can. Yet it's only $65k, comparable to the average salary of a plumber.
Now imagine you dropped all coercion, got rid of all of these "worthless" jobs, and so much more. What would it be? Suffice to say dramatically lower. And the things you mention as "free" are not free. They're driven by extensive labor, companies, and support. Last year the UK spent about $4,400/person on healthcare. And in your ideal world where nobody is forced to work, this number would likely *go up*. The reason is that a lot of the jobs that you're paying for in that $4,400 are things people don't want to do. But they do them, because they need to put food on the table. Give them the option of no longer having to even bother with that, and they could happily go home and spend time pursuing their own interests, with their family, etc. You're going to need to really bring up the $$$ their to get them go back to what they were doing.
And that effect trickles around everywhere. That food on the table, which we're now somehow supplying? Exact same story. The global wealth starts to collapse at the same time that it becomes more expensive than ever to get people to actually do things. Can you guess what happens when you combine these two things? You don't need to look far for examples. It's not like the people that took over places such as China or what would become the USSR were secretly plotting to become tyrants. They believed what they were saying, what you are saying, and thought that the only thing between comfort and equality for all, was a little bit of elbow grease and rearranging of society. And they acted on it. And in both nations, both of which were previously relatively thriving, they created dystopias where in both tens of millions of people would end up dying of starvation. And in both, as the coercion to work and produce was removed, they found people suddenly stopped working and producing. And so the government was left to take over the previous coercive role of the market leading to dystopic authoritarianism.
In a nutshell, our wealth is a facade. It is little more than a reflection of our economic system. The efforts to take our wealth as a granted and use that "reform" the economic system fail because the wealth and the economic system are one and the same.