There was talk about renaming the Krugman thread for this purpose, but that seems to be going nowhere. Besides which, I feel the Krugman thread should be left to discuss Krugman while this thread can be used for more general economic discussion.
Discuss:
- The merits of competing theories.
- The role of the government in managing the economy.
- The causes of and solutions to our current economic woes.
- Comparisons between the economic systems of different countries.
- Theoretical and existing alternatives to our current market system.
edited 17th Dec '12 10:58:52 AM by Topazan
Isn't that old news?
"For a successful technology, reality must take precedence over public relations, for Nature cannot be fooled." - Richard Feynman
The Mod with the Migraine
If it is, it's news I hadn't seen before.
That’s the epitome of privilege right there, not considering armed nazis a threat to your life. - Silasw
Destroyer of Worlds
What are people's opinions on Marx?
"You can't change the world without getting your hands dirty."
A wee bit too materialistic in his history view. Not all actions through history are informed by material needs. Ideology and these things carry important independent roles in human behaviour.
Also, dude didn't know yet that free energy isn't a thing.
"For a successful technology, reality must take precedence over public relations, for Nature cannot be fooled." - Richard Feynman
United Earth
Superstructure and infrastructure are in a closed feedback loop, not an open one.
Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that.
Lost in Space
Marx accurately predicted the worker's revolutions that were caused by poor wages and working conditions. He failed to understand that human nature always fails at the final transition from a state-run command economy to a decentralized Communist economy. The advantage of a market economy is that it does a better job of setting prices and creating incentives to work and innovate.
edited 18th Jan '17 4:17:09 AM by Fighteer
"It's Occam's Shuriken! If the answer is elusive, never rule out ninjas!"
The law in the night
Marx had some interesting insights on the power play between employers and workers in the Manifest of the Communist Party, though he ultimately advocated for a violent resolution for the class struggle and in many ways it created a divisive ideology. As history shows the bourgeoisie can encompass not only the very wealthy but anyone who isn't working in a back breaking job or is considered an intellectual or privileged class like scholars or highly trained and well paid professionals.
Marx also got his idea of surplus value as a combination of human labor and commodity without accounting the desirability of the goods, the market demand dictating the prices and the overall availability of both commodities and the goods also being one of the factors leading to the price of any given good. Wages also being a function of time and unit produced is very outdated, it also ignores the added value of the production to consumption chain.
His idea of profit also is limited to being reduced to only being achieved through the exploitation of the worker and that exploitation being the goal of profit.
His views of the socialist means of production are pretty much utopian, both by not being aware of the scarcity issue but also requiring that every single worker in a socialist economy to be completely motivated to work even without any extra reward for working harder or more than the others, being content with their current situation and without ambition or the drive to get or be something more. Which obviously ignores a lot about the human nature.
Also, his predictions about the socialist and communist revolutions were very far off, the capitalist countries did a pretty decent job in managing the economic crisis and correct some of the issues. So far that none of the industrialized countries he predicted that would suffer a revolt and become socialist nations didn't, meanwhile underdeveloped and rural nations did and they were forced to undergo the development of their industrial force after the revolution and not before it as predicted to Marx.
edited 18th Jan '17 4:52:43 AM by AngelusNox
Inter arma enim silent leges
United Earth
![[up]](https://static.tvtropes.org/pmwiki/pub/smiles/arrow_up.png "[up]"){kind=icon}
Interestingly enough, the chance for a big payoff can motivate a lot more than the actuality of a small payoff. From the American Dream, to the Celebrity Celebration, to the Lottery, you don't need to actually spend that much on rewarding people, so long as you give huge rewards to a select few and hyper-publicize them.
The law in the night
Not even that. Utopian Marxism has some issues with the work/reward mentality. It essentially enforces equality amongst workers at every layer.
Any worker that puts a higher work input in his occupation will be rewarded the same as his less performing peers.
Which brings an issue regarding motivation and rewards, both social and material rewards. Any given worker that desires something more, whether it be a better accommodations, more or different food or simply possess something that most people don't, won't be able to get those things.
The reasoning behind the worker not being able to achieve something more through harder or more work is simply because it undermines everyone else. If the worker is rewarded for his extra work, you will eventually create a new layer in the worker class where overachievers or hard workers become differentiated from the mass of workers. This differentiation can come from the overachieving workers reducing the overall value of the lot and the better rewards can and certainly will create a new class of workers, an elite of workers if you allow it, where those on this elite of workers will set a new standard and enjoy luxuries or be held in a higher standing than everyone else. Which can result in the classic Four Legs Good Two Legs Better scenario, where the new class of elite workers evolve to become the ruling elite.
Surely it sound more egalitarian than what we have today, but it isn't so far off how the primitive societies created their own elite groups, some of which still exist today. This explicitly goes against the ideals of having a perfectly equal society.
On the other hand not rewarding those workers can lead to lower production and worker motivation.
Logically working more than anyone else without a tangible reward stimulates whoever is working more to simply reduce its amount of work until it fits the average. If the average work input start dropping, so will every worker also reduce their input to match the average. Fixing this drop either means reinstalling more rewarding work, which results in the former issue or force the workers to produce more through having an organization like the Workers Union to demand more from their workers, which can lead to an exploitative rule due to the need to fulfill the demand or keep the production at levels that are deemed acceptable. Which goes against the idea of having the workers enjoying the freedom from the exploitation and also can create an authority which the forces the workers to perform work against their wishes or will.
Inter arma enim silent leges
United Earth
"the better rewards can and certainly will create a new class of workers, an elite of workers if you allow it, where those on this elite of workers will set a new standard and enjoy luxuries or be held in a higher standing than everyone else"
So long as they're held to a higher standard, why not? "Man, this person sure works hard. Sure, they have a nicer house, but they barely spend any time there! Also, everyone is constantly paying attention to what they do, and when they make a mistake, when they falter, it really shows. Honestly, I'm glad I don't stand out."
Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that.
United Earth
A guy with bushy eyebrows and a mustache who is always romancing a Grande Dame or your wife.
Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that.
That bastard owes me money!
The law in the night
The issue isn't just the apathy towards the overachievers, there will be a divergence between the regular workers and the ones who either excel for being better at the job than the rest or brought forward a new idea or invention that puts them ahead of everyone else.
If this divergence aggregates over time, you will have a class of workers who either through better efficiency or innovation will become the upper class. There can be also resentment from both sides, the upper workers seeing themselves as the ones who carry the burden and the lower workers who want the same stuff but without putting as much effort into their work. Pride, envy and greed at work.
Not to mention that not all work is equal, a medic or an engineer require years of training to reach their expertise levels, meanwhile a factory worker needs a week training depending of the position. Which kind of incentive does an engineer has to be one if he will receive the same social and material reward as the factory worker? What do you tell the worker who wants to be engineer or a medic but isn't intelligent or skilled enough to be one?
I've seen it happen with the strawberry cooperative my brother helps managing which I sometimes help him with when needed. Farmers undercutting farmers because one of them produces more strawberries and gets a higher income as a result, including the rest complaining to my brother demanding to be paid as much as those more efficient producers were.
I think there is a reason why I think Communism and Utopian societies based on full equality aren't going to work. They require perfect human beings that are content with their situation, don't question their roles in society and a devoid of things like ambition, greed, want and envy.
Not to mention the mess it is to plan an economy in an society where everyone gets an equal share, equal voice but also supposed to be free to do whatever they aspire to do and free from authority.
edited 18th Jan '17 10:09:03 AM by AngelusNox
Inter arma enim silent leges
United Earth
Eh, everything is a headache, it just changes flavor.
I guess my ideal is not equality, but equal opportunity in a meritocracy. That is, I'm fine with the most competent people putting themselves on top so long as they want it, earn it, and don't get to rent-seek. Here in Sweden a CEO really doesn't make that much more than a baseline worker, but has so much work and responsibility that workaholism is practically mandatory and they have no life outside that. The office drones do not envy them.
So envy as a zero sum game mindset is largely a cultural matter, I think. Have your farmers considered raising their own standards rather than pettily trying to keep others down? Ask to be taught? Can't the leaders share their technical acumen?
Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that.
The law in the night
We told them to raise their productions if they wanted to earn the same, but they really like to drink in the morning, we also provided instructions in how to better tend their farms after we hired an agronomist to correct production flaws and switched to more appropriated pesticides and fertilizers. It was met and still being met with a lot of resistance by some of our farmers because they have been working on farming longer than we've been alive and act like we can't contribute on the production input. Those who did listen had a considerable income increase.
There aren't leaders per see, my uncle food distribution company pays by the box, if the cooperative wants to earn more they will have to send more. My brother manages the inputs and outputs and aids the production, since my uncle is an associate my brother is there to make sure he isn't being undercut, which he was before my brother could get there by his other less than honest associates.
The sheer irony is how the majority of those producers could be wealthier than anyone I know, the ones who put a lot of work into their farms raised their standard of living from living into a shack and wearing hand me downs to living in a fairly large house and driving large pickup trucks.
The biggest hurdle we have are the people themselves, it wouldn't be so bad if they didn't act like a bunch of crabs in a bucket.
I don't envision enforcing total equality as something that is desirable or even achievable, providing equal opportunities and fair rewarding should work for most people at least and wouldn't have to sacrifice things like free will and progress.
Inter arma enim silent leges
United Earth
"they have been working on farming longer than we've been alive and act like we can't contribute on the production input"
Oh. Real, actual, honest to goodness idiots.
Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that.
Professional Forum Ninja
Anyone have any theories/studies on the possibility of a One World Currency?
I predict a move towards other currencies once Trump screws up the economy, but with the issues with some of the other big currencies, I fully expect a push for a OWC to pop up as well.
"We're all paper, we're all scissors, we're all fightin' with our mirrors, scared we'll never find somebody to love."
A single currency won't work without fiscal unity (this is one of the biggest problems with the Euro).
Lost in Space
Yep, it's completely impossible without a central issuing authority having the power to collect taxes and conduct fiscal policy. (By extension, it must also be able to compel payment of taxes, meaning it needs an army, and to use that army, it needs political sovereignty.) Otherwise it's just the gold standard Mark II, which has worked out so very well for Europe.
edited 22nd Jan '17 3:33:41 PM by Fighteer
"It's Occam's Shuriken! If the answer is elusive, never rule out ninjas!"
Well, there's always Bitcoin! .... 
bitcoin is like the gold standard only even stupider. It's like if "gold" money was made by at great expense and effort digging gold out of mines, refining it, and then for every ten grams of pure gold you threw into an active volcano, you got to issue one doubloon. Made of lead.
Oh, bother.
Bitcoin makes the Euro look rock solid stable.
Disgusted, but not surprised
Bitcoin was never anything more than an investment bubble that burst some time ago.
There's a short article about why exactly Millenials aren't making money
, and it's largely about college costs. Several graphs at the link.
They don’t get married and start families. They live in mom’s basement and don’t buy their own house. They drift from job to job and school to school trying to find their “passion.” In short, they can’t “adult.”
But while it’s true that these problems can be attributed to serious character flaws – which do need to be fixed - I wonder if we too often overlook the fact that millennials really are up against some difficult odds. And as a new study released by the Young Invincibles implies, one of the biggest may be student debt.
According to the Young Invincibles, research shows that “young adult workers today earn $10,000 less than young adults in 1989, a decline of 20 percent.” The study is quick to note that “a college degree – with or without debt – is still worth it.” It goes on, however, to say:
“That said, among those with a college degree, we find a strong correlation between those with no student loan debt and those with the least decline in income across the two generations.”
Observe, for example, the following two charts. The first shows the difference in earnings between boomers and millennials with various degrees of education. Those with a degree and without debt experienced the smallest decline.
The second shows the difference in net wealth between boomers and millennials. Again, the millennials with a degree and no debt are sitting far better than those with a debt-laden degree.
Many might immediately jump on this and argue that this is exactly why we should offer free college to everyone.
But given that college costs have risen at a far greater rate than other costs (chart below), will transferring the tuition payments from the individual to the taxpayer really solve the problem? Should we instead consider that colleges are offering students a product worth far less than they’re selling it for?