What's the lesson from this story?

[jackstar7]

Were we having a discussion? I was waiting for the continued English lessons.

Pray, continue.

EDIT: Or, let me simplify things, you've already decided I am too dumb to have this conversation with you, so here's a time-saver: don't.

 

[cubby1223]

Clearly I stated things awkwardly in relation to my point.

If the aim of a business is to extract the maximum profit from the minimum of resources, then there must be a balance between those goals and the goal of a prosperous citizenry (with their own level of comfort). One source of conflict is that a primary motivator of people is fear, and this is exploited to achieve greater profit.

Some business owners believe that is the ultimate aim. Other business owners do not believe that is the ultimate aim.

I actually do believe unions are a necessity for the best balance. And proper unions can create a more prosperous business in certain cases. However, I feel the current structure of most unions in the U.S. currently are either (1) pure greed on a monopolized workforce (usually those in the public sector) hurting prosperity outside the union, or (2) obsolete due to globalization and ineffective because of it.

Take the robber barons of the railroad, steel, energy, & banking industries. They treated their workforce like absolute shit. I didn't live during those times, I can't go back and fight for better working conditions for them. But at least I can enjoy the prosperity the infrastructure they built up in this nation has brought to all of us.

And then there were the other companies recently like Enron, Tyco, Worldcom, that abused people and also left us with nothing of value. Or there is a company like Microsoft which has comparatively treated their workforce well, provided us with products that enable every one of us to achieve better prosperity.

I don't know how to sum up the whole situation in a single line of wisdom. Some people in this world are good towards others, and some people are not. And when it comes to business, if the bottom line at the end of the year isn't right, the business ceases to exist.

 

[jackstar7]

Some business owners believe that is the ultimate aim. Other business owners do not believe that is the ultimate aim.

I actually do believe unions are a necessity for the best balance. And proper unions can create a more prosperous business in certain cases. However, I feel the current structure of most unions in the U.S. currently are either (1) pure greed on a monopolized workforce (usually those in the public sector) hurting prosperity outside the union, or (2) obsolete due to globalization and ineffective because of it.

Take the robber barons of the railroad, steel, energy, & banking industries. They treated their workforce like absolute shit. I didn't live during those times, I can't go back and fight for better working conditions for them. But at least I can enjoy the prosperity the infrastructure they built up in this nation has brought to all of us.

And then there were the other companies recently like Enron, Tyco, Worldcom, that abused people and also left us with nothing of value. Or there is a company like Microsoft which has comparatively treated their workforce well, provided us with products that enable every one of us to achieve better prosperity.

I don't know how to sum up the whole situation in a single line of wisdom. Some people in this world are good towards others, and some people are not. And when it comes to business, if the bottom line at the end of the year isn't right, the business ceases to exist.

All reasonable and I appreciate it. Certainly business has the potential and means to facilitate societal strength and stability, and in this context, I am, perhaps, thinking more of the corporations, rather than the simpler and smaller businesses out there, but the principles sort of scale down, but then it reaches the individuals and has to be reconciled with their philosophies.

Then we have the opposite scaling from the individual worker and up to the larger workforce.

Again, thank you for taking the time to spell things out.

 

[TheSlamma]

I appreciate the response but I was merely summerizing the main contentions people in the story brought up. Your response mirrors my own feelings which really boils down to people just being illogical.

It's nice to see you can talk and think like a rational human being sometimes.

 

[ivwshane]

It's nice to see you can talk and think like a rational human being sometimes.

Don't say stupid shit and I won't respond in kind

 

[Grey_Beard]

Sorry for the late entry, as I have a number of thoughts. I hope to get them all out.

Income in general has been stagnant. This is documented. Unions may not be the necessary entities they once were, but we owe many of today's employment practices to the unions. An 8 hour work day, 40 hour work week, child labor laws, etc.

To think that wealth and business success does not come from society is not an accurate perception. I know this flies in the face of many, but hard work does not necessary mean success financially. In order for a business to get revenue, society has to be willing to buy the product. Many forget this and think that this is a mutually exclusive idea., not really so.

Too many business owners feel compelled to either push their philosophy on others or feel they have the right to question another's actions based on its impact on their business like they live in a bubble. This business owner feels compelled to even the playing field. Many have been successful doing this. How many teams win a World Series, Super Bowl or Stanley Cup with the highest paid player or the highest salaried teams? Not many. How many teams with the highest revenue actually have a winning record? Not many.

The sports analogy is one that we often forget. When there is imbalance in the pay structure there is usually not success. When there is a more even distribution of these resources there is. Business should be the same, although there is more than just salaries involved.

One person mentioned that someone that closes 100 mortgages should be paid more than someone who closes 50, why? Is that the only measure of productivity? Not really. What if the value of those 50 were twice that of the 100 and the total fees received were triple? Why would the person who got 50 not be paid more?

Productivity is an interesting thing. What does a productive person do? What if they have a complex task that takes hours to do? Do we compare that to someone who has a simple task equally?

This country is moving away from democracy and into a more centralized oligopoly. This discussion is less about the true Republican (although most Republican voters vote against what is best for them by voting Republican which is another thread) or Democratic principles, but those of wealth and the concentration of wealth.

We often confuse success with greed. This is why people get upset that another person who does what they perceive as less bit is paid more. Our greed makes us jealous. It makes us think that certain things exist when they really do not. Since we define success by the amount of greed we have, e.g. wealth, it distorts perceptions and makes us do funny things to chase our greedy ideals. This is reflected in the increase in the CEO salaries from around 20 times the average worker 50 or 60 years ago to well over 500 times today. Everyone wants this type of salary, which also shows up when we play the lottery.

Some have even said the economics is about efficiency and profit, but these are concepts which are very hard to actually implement. Economic concepts also tell us we should spend the least amount of money possible and maximize profit. In reality there is a fine line between this and bankruptcy. You can apply the economic concepts all you but if the product being sold does not sell, they are meaningless. What value does Facebook bring us? Why is it valued so high? What do they produce? Value, revenue, sales, etc. can make no sense, as they sometimes just happen

Take Trump for example. He says all kinds of crazy things, but still leads in the polls. Are we really voting for a King?

 

[realibrad]

Sorry for the late entry, as I have a number of thoughts. I hope to get them all out.

Income in general has been stagnant. This is documented. Unions may not be the necessary entities they once were, but we owe many of today's employment practices to the unions. An 8 hour work day, 40 hour work week, child labor laws, etc.

To think that wealth and business success does not come from society is not an accurate perception. I know this flies in the face of many, but hard work does not necessary mean success financially. In order for a business to get revenue, society has to be willing to buy the product. Many forget this and think that this is a mutually exclusive idea., not really so.

Too many business owners feel compelled to either push their philosophy on others or feel they have the right to question another's actions based on its impact on their business like they live in a bubble. This business owner feels compelled to even the playing field. Many have been successful doing this. How many teams win a World Series, Super Bowl or Stanley Cup with the highest paid player or the highest salaried teams? Not many. How many teams with the highest revenue actually have a winning record? Not many.

The sports analogy is one that we often forget. When there is imbalance in the pay structure there is usually not success. When there is a more even distribution of these resources there is. Business should be the same, although there is more than just salaries involved.

One person mentioned that someone that closes 100 mortgages should be paid more than someone who closes 50, why? Is that the only measure of productivity? Not really. What if the value of those 50 were twice that of the 100 and the total fees received were triple? Why would the person who got 50 not be paid more?

Productivity is an interesting thing. What does a productive person do? What if they have a complex task that takes hours to do? Do we compare that to someone who has a simple task equally?

This country is moving away from democracy and into a more centralized oligopoly. This discussion is less about the true Republican (although most Republican voters vote against what is best for them by voting Republican which is another thread) or Democratic principles, but those of wealth and the concentration of wealth.

We often confuse success with greed. This is why people get upset that another person who does what they perceive as less bit is paid more. Our greed makes us jealous. It makes us think that certain things exist when they really do not. Since we define success by the amount of greed we have, e.g. wealth, it distorts perceptions and makes us do funny things to chase our greedy ideals. This is reflected in the increase in the CEO salaries from around 20 times the average worker 50 or 60 years ago to well over 500 times today. Everyone wants this type of salary, which also shows up when we play the lottery.

Some have even said the economics is about efficiency and profit, but these are concepts which are very hard to actually implement. Economic concepts also tell us we should spend the least amount of money possible and maximize profit. In reality there is a fine line between this and bankruptcy. You can apply the economic concepts all you but if the product being sold does not sell, they are meaningless. What value does Facebook bring us? Why is it valued so high? What do they produce? Value, revenue, sales, etc. can make no sense, as they sometimes just happen

Take Trump for example. He says all kinds of crazy things, but still leads in the polls. Are we really voting for a King?

I think your biggest flaw is that you seem to think the economy is made up of lucky winners and unlucky losers and whom ever wins is a lottery.

The reason salary is supposed to be based on productivity is that it directs resources to their most efficient uses. Which brings me to my next point which is that the value of money is supposed to be based on the value or utility of a good or service.

Lets look at CA for a moment. It is running out of water and instead of using price as a signal to conserve water, they keep the price much lower than it otherwise would be. This then causes some weird things in the market, such as the rush of farmers to plant water intensive crops. That is correct, you read that right. CA right now has a big problem of farmers ripping out crops that use less water and planting crops that need more water. Resources, in this case water, are going toward crops that otherwise would not be profitable. Its a breakdown of the fundamental principle of capitalism.

Wealth does not inherently represent greed. A business person could become wealthy by providing a good or service that people choose to buy and makes them better off. What I think you mean to say is that the rules are bent or broken in the favor of those who have the influence to take advantage of the system, but, this is not a republican problem so much as a systemic problem. Both sides are pro business, which is why both sides take in billions of donations.

 

[Grey_Beard]

I think your biggest flaw is that you seem to think the economy is made up of lucky winners and unlucky losers and whom ever wins is a lottery.



The reason salary is supposed to be based on productivity is that it directs resources to their most efficient uses. Which brings me to my next point which is that the value of money is supposed to be based on the value or utility of a good or service.



Lets look at CA for a moment. It is running out of water and instead of using price as a signal to conserve water, they keep the price much lower than it otherwise would be. This then causes some weird things in the market, such as the rush of farmers to plant water intensive crops. That is correct, you read that right. CA right now has a big problem of farmers ripping out crops that use less water and planting crops that need more water. Resources, in this case water, are going toward crops that otherwise would not be profitable. Its a breakdown of the fundamental principle of capitalism.



Wealth does not inherently represent greed. A business person could become wealthy by providing a good or service that people choose to buy and makes them better off. What I think you mean to say is that the rules are bent or broken in the favor of those who have the influence to take advantage of the system, but, this is not a republican problem so much as a systemic problem. Both sides are pro business, which is why both sides take in billions of donations.

Productivity is not always the most efficient use of resources. You ignored my example. If one person produces 50 of something that is valued at $1,000,000 dollars but another produces 25 of something that is valued at $10,000,000 over the same time period which one is more productive? In your mind the person who produced 50.

You seem to miss the point. Greed is present without wealth. Wealth does not mean greed. These are two different things. They do intersect, but they can exist without each other. I never mentioned rules, I mentioned that there is an almost fully developed oligopoly which has the power and wealth to influence both Republican and Democratic agendas. Yes money can bend rules, but so can many other things, albeit not as effectively.

I am not sure that the limited water resources in CA makes your point. This is the tact we use for gasoline. If we want to conserve it, make it much more expensive, but we do not. Just because price is high does not mean it will lead to less use. It may mean that these costs are passed on. This could very well expand this wealth gap, keeping the wealthy in the same shape they are today, but really raising the poverty line and lowering the middle class, as they are much more susceptible to inflation.

Just because you develop the best mouse trap, will the world beat your door down automatically? Everyone thinks capitalism is just that, but it is not. Being in the right place at the right time is crucial. Call it luck, call it whatever, but it does have an impact.

My lottery example was to demonstrate that mainly lower socioeconomic classes participate to chase the ideal of money solves problems, which is a foundation for the greed epidemic we have today.

 

[piasabird]

Where is the incentive to work harder and get promoted?

 

[realibrad]

Productivity is not always the most efficient use of resources. You ignored my example. If one person produces 50 of something that is valued at $1,000,000 dollars but another produces 25 of something that is valued at $10,000,000 over the same time period which one is more productive? In your mind the person who produced 50.

Your example is wrong and shows a fundamental misunderstanding of what productivity is. You are not the first do not know what productivity is on this forum. I think it comes from the idea that economics looks only at numbers but does not understand the real world. So when you couple that with a lack of understanding of the words used in economics you get your view.

Okay, so to your point here about productivity. The producer that made more units but less value produced less than the producer that made less units but more value. Assume the dollar value you listed is market value which tries to capture utility, then in economic terms, the producer that made more value from the same amount of resources was more efficient. Its actually super simple. That also means you were wrong about your assumption about what I would say was more productive.

You seem to miss the point. Greed is present without wealth. Wealth does not mean greed. These are two different things. They do intersect, but they can exist without each other. I never mentioned rules, I mentioned that there is an almost fully developed oligopoly which has the power and wealth to influence both Republican and Democratic agendas. Yes money can bend rules, but so can many other things, albeit not as effectively.

I am very confused now. From what you said, I took it as an agreement by you with the idea.

Since we define success by the amount of greed we have, e.g. wealth

If you are saying wealth is not caused by greed, then great, we agree.

I am not sure that the limited water resources in CA makes your point. This is the tact we use for gasoline. If we want to conserve it, make it much more expensive, but we do not. Just because price is high does not mean it will lead to less use. It may mean that these costs are passed on. This could very well expand this wealth gap, keeping the wealthy in the same shape they are today, but really raising the poverty line and lowering the middle class, as they are much more susceptible to inflation.

You just went against a major part of economics. Making something more expensive will make people use less. In the example of gasoline, you see the same thing. The price of gas went too high, and it pushed the market to find other fuels like natural gas.

The last part is meaningless as its built off of assumptions. If you want to go into them, meh, but they will take a while.

Just because you develop the best mouse trap, will the world beat your door down automatically? Everyone thinks capitalism is just that, but it is not. Being in the right place at the right time is crucial. Call it luck, call it whatever, but it does have an impact.

There is some luck sure, and Capitalism is not perfect. It just happens to be better than every other system out there. I will grant you socialism does away with most of the luck at the expense of innovation and growth. There less corruption in Socialism, but that is because any choice the state makes to benefit someone is not corrupt.

My lottery example was to demonstrate that mainly lower socioeconomic classes participate to chase the ideal of money solves problems, which is a foundation for the greed epidemic we have today.

If money does not solve problems, then why are you concerned with wealth inequality?

 

[Grey_Beard]

Your example is wrong and shows a fundamental misunderstanding of what productivity is. You are not the first do not know what productivity is on this forum. I think it comes from the idea that economics looks only at numbers but does not understand the real world. So when you couple that with a lack of understanding of the words used in economics you get your view.

I guess we disagree then. In the real world, there is never a silver bullet that is always the right answer, although in the make believe world of economics, there is. Economics is a concept, although it can be applied to reality, it is not always accurate in every application. I am sorry if that is not something you can understand.

Okay, so to your point here about productivity. The producer that made more units but less value produced less than the producer that made less units but more value. Assume the dollar value you listed is market value which tries to capture utility, then in economic terms, the producer that made more value from the same amount of resources was more efficient. Its actually super simple. That also means you were wrong about your assumption about what I would say was more productive.

Production must be based on a unit produced standard, which is the economic concept you have said defines efficiency. That concept has nothing to do with revenue. To then say that the most efficient use takes in account revenue is not an accurate allocation of the principle. Please tell me what production environment you work in or have worked in that uses revenue produced at a standard? If you cannot see the example as showing the deficiency with the concept, then I guess you may not really understand the underlying concept to begin with.

I am very confused now. From what you said, I took it as an agreement by you with the idea.

Okay, but greed cannot be good. Even in Capitalism, greed is a cancer. The was a time in the early days of Capitalism, the great time that many harken back to, the 1950's when there were a lot more socially conscience corporations. There are many today, but the great many are not.

If you are saying wealth is not caused by greed, then great, we agree.

Hard work also does not mean success or wealth. Many have worked tirelessly for many years only to stay where they are and never "make it". To be wealthy is very much like hitting the lottery, as odds of being that way are about the same. No one says it does not happen, but the odds are not in your favor.

You just went against a major part of economics. Making something more expensive will make people use less. In the example of gasoline, you see the same thing. The price of gas went too high, and it pushed the market to find other fuels like natural gas.



The last part is meaningless as its built off of assumptions. If you want to go into them, meh, but they will take a while.

Economics is a concept. Are you saying that every concept must be applied in every instance or you cannot go against it? Concepts are always transferred to every situation perfectly?

Take the iPhone. Would any of us thought we would pay $600 for a phone which up to that point cost basically $50? I would not, but they presented a value proposition that justifies the increase in cost. Is that the most efficient use of the dollars in my pocket? No, as economics says, buy the phone with the least cost. You may agree it is more than a phone, but that is the value proposition for the specific device. As for gas, water or anything that is a necessity for daily living this concept does not hold true. I still purchase the same amount of gas (number of gallons) as I did before the price went to over $4.00 a gallon. How many natural gas powered vehicles are on the road today? How many are in your garage? How many hybrids do you own? The market may have produced them, but they are not outselling the fossil fuel models. In your example they should do that immediately. Economics can sometimes be very inept at understanding certain situations.

There is some luck sure, and Capitalism is not perfect. It just happens to be better than every other system out there. I will grant you socialism does away with most of the luck at the expense of innovation and growth. There less corruption in Socialism, but that is because any choice the state makes to benefit someone is not corrupt.

Capitalism is not equipped to deal with every situation. It irritates me that many apply it like it a law of nature. It is not. It may be best equipped to deal with many situations, but there are also some that socialism is best equipped to deal with. Why is the police department or fire department not a Capitalistic function? It does not work for that area as well a socialistic system does. To apply either concept as an all or nothing is one of the failures of most governments.

If money does not solve problems, then why are you concerned with wealth inequality?

I am concerned as it will lead to civil unrest. If everyone made enough money to survive at an economically viable level, then this could be averted, but anytime to get an imbalance, there will be a correction. It happens all the time in the great bastion of Capitalism, the stock market.

 

[Grey_Beard]

Where is the incentive to work harder and get promoted?

In the knowledge that others will be more than willing to take your job if it were open. Not all motivation is based on raises and dollars, some is fear or even the lack of income.

 

[thraashman]

Where is the incentive to work harder and get promoted?

Since when in American is higher pay and promotions based on working harder? Hasn't been that way anywhere I've worked. It's usually based on how well you schmooze with the higher ups.

 

[realibrad]

I guess we disagree then. In the real world, there is never a silver bullet that is always the right answer, although in the make believe world of economics, there is. Economics is a concept, although it can be applied to reality, it is not always accurate in every application. I am sorry if that is not something you can understand.

What do you think economics has said is a silver bullet? Give me an example of when economics said to do something, and when it was wrong.

Production must be based on a unit produced standard, which is the economic concept you have said defines efficiency. That concept has nothing to do with revenue. To then say that the most efficient use takes in account revenue is not an accurate allocation of the principle. Please tell me what production environment you work in or have worked in that uses revenue produced at a standard? If you cannot see the example as showing the deficiency with the concept, then I guess you may not really understand the underlying concept to begin with.

It is, and that unit is not what you think it is, which is why I explained what production is and what it is not is based on the number of nominal items produced. Productivity in economics is about utility and not items produced. This is now twice that I have explained this, and I dont know if you will get it this time. At some point I will give up trying to repeat myself. That is not a threat but an explanation as to why I might stop addressing something.

Okay, but greed cannot be good. Even in Capitalism, greed is a cancer. The was a time in the early days of Capitalism, the great time that many harken back to, the 1950's when there were a lot more socially conscience corporations. There are many today, but the great many are not.

Greed can lead to both good and bad. I really depends about how someone goes about gaining the things they want. If I am greedy and I want to be the only seller of an item, and the way I accomplish that is by producing something that is better than anyone else, then who is really hurt? If I want all of your things so I rob you, then you are worse offer and there is not a net gain. I will say that many that are "greedy" that I have met would not care if they cheated the system to get ahead.

Hard work also does not mean success or wealth. Many have worked tirelessly for many years only to stay where they are and never "make it". To be wealthy is very much like hitting the lottery, as odds of being that way are about the same. No one says it does not happen, but the odds are not in your favor.

Correct. Working hard does not and should not grant wealth. I could bust my ass all day beating the ground with a bat, but it does not make my labor productive. For very good reason only some hard work is valued. You do not want a world where everyone works hard doing unproductive work.

Economics is a concept. Are you saying that every concept must be applied in every instance or you cannot go against it? Concepts are always transferred to every situation perfectly?

I have no idea what you are talking about here. I went back and tried to find context, but I don't get it. I was talking about how an increase in price pushes down consumption. Can you please explain what you mean to say here?

Take the iPhone. Would any of us thought we would pay $600 for a phone which up to that point cost basically $50? I would not, but they presented a value proposition that justifies the increase in cost. Is that the most efficient use of the dollars in my pocket? No, as economics says, buy the phone with the least cost.

Economics does not say that at all. Economics says that to maximize utility at the lowest cost possible. If you were a construction worker and need to tow a backhoe, you would not buy the cheapest truck you could if that truck could not pull the backhoe. That is because the point of buying the truck would be mainly to pull the backhoe and if it cannot do that, its utility for the task is zero.

Now, if you did buy the cheapest truck that could pull the backhoe, but it had a 5 gallon tank, and the next model up had a 30 gallon tank that cost $5 more, and you could afford the $5, then the more expensive of the 2 would be the best option because it gives much more per dollar. The much larger tank would mean that the driver would have to fill up less often and that would be a cheaper option, because the $5 cost is much lower than the amount of time that would be spent at a gas station.

You may agree it is more than a phone, but that is the value proposition for the specific device. As for gas, water or anything that is a necessity for daily living this concept does not hold true. I still purchase the same amount of gas (number of gallons) as I did before the price went to over $4.00 a gallon. How many natural gas powered vehicles are on the road today? How many are in your garage? How many hybrids do you own? The market may have produced them, but they are not outselling the fossil fuel models. In your example they should do that immediately. Economics can sometimes be very inept at understanding certain situations.

There is more to the situation than you seem to realize. A hybrid engine costs far more than a gasoline engine.

Lets use this site to help establish the situation.
http://www.autotrader.com/car-info/camry-qa-whats-the-real-cost-savings-with-the-hybrid-150189

The Camry with the hybrid engine costs 3k more and the avg drive would save $600 a year in gas. That would mean it would take 5 years to make its money back on gas. I wont say it saves time, because there are other maintenance issues and things get murky when you compare all the costs. But, hybrid engines are very often more than 3k difference in price

Capitalism is not equipped to deal with every situation. It irritates me that many apply it like it a law of nature. It is not. It may be best equipped to deal with many situations, but there are also some that socialism is best equipped to deal with. Why is the police department or fire department not a Capitalistic function? It does not work for that area as well a socialistic system does. To apply either concept as an all or nothing is one of the failures of most governments.

Sure, somethings work better under different systems. Pollution is another example you did not list. Usually, the things that capitalism has a problem with are 3rd party effects. The difference that Capitalism has is that it is typically the most efficient system, even in many 3rd party situations.

As I brought up with water in CA you can see this. The price of water is being sold though a socialist system, and its causing an over consumption of water. The reason is that farmers are a big part of the CA economy and lobby to keep prices low. The farmers unions stop price from being higher because many crops would be unprofitable if they had to pay higher prices.

Socialism would work great if people were not corrupt and had perfect knowledge. They do not, which is why so many economists default to capitalism. It gives us the outcomes more often we want. Not 100% of the time, but far more often.

I am concerned as it will lead to civil unrest. If everyone made enough money to survive at an economically viable level, then this could be averted, but anytime to get an imbalance, there will be a correction. It happens all the time in the great bastion of Capitalism, the stock market.

You will need to explain more. I don't know what the point is that you were trying to make.

 

[Grey_Beard]

What do you think economics has said is a silver bullet? Give me an example of when economics said to do something, and when it was wrong.







It is, and that unit is not what you think it is, which is why I explained what production is and what it is not is based on the number of nominal items produced. Productivity in economics is about utility and not items produced. This is now twice that I have explained this, and I dont know if you will get it this time. At some point I will give up trying to repeat myself. That is not a threat but an explanation as to why I might stop addressing something.







Greed can lead to both good and bad. I really depends about how someone goes about gaining the things they want. If I am greedy and I want to be the only seller of an item, and the way I accomplish that is by producing something that is better than anyone else, then who is really hurt? If I want all of your things so I rob you, then you are worse offer and there is not a net gain. I will say that many that are "greedy" that I have met would not care if they cheated the system to get ahead.







Correct. Working hard does not and should not grant wealth. I could bust my ass all day beating the ground with a bat, but it does not make my labor productive. For very good reason only some hard work is valued. You do not want a world where everyone works hard doing unproductive work.







I have no idea what you are talking about here. I went back and tried to find context, but I don't get it. I was talking about how an increase in price pushes down consumption. Can you please explain what you mean to say here?







Economics does not say that at all. Economics says that to maximize utility at the lowest cost possible. If you were a construction worker and need to tow a backhoe, you would not buy the cheapest truck you could if that truck could not pull the backhoe. That is because the point of buying the truck would be mainly to pull the backhoe and if it cannot do that, its utility for the task is zero.



Now, if you did buy the cheapest truck that could pull the backhoe, but it had a 5 gallon tank, and the next model up had a 30 gallon tank that cost $5 more, and you could afford the $5, then the more expensive of the 2 would be the best option because it gives much more per dollar. The much larger tank would mean that the driver would have to fill up less often and that would be a cheaper option, because the $5 cost is much lower than the amount of time that would be spent at a gas station.







There is more to the situation than you seem to realize. A hybrid engine costs far more than a gasoline engine.



Lets use this site to help establish the situation.

http://www.autotrader.com/car-info/camry-qa-whats-the-real-cost-savings-with-the-hybrid-150189



The Camry with the hybrid engine costs 3k more and the avg drive would save $600 a year in gas. That would mean it would take 5 years to make its money back on gas. I wont say it saves time, because there are other maintenance issues and things get murky when you compare all the costs. But, hybrid engines are very often more than 3k difference in price







Sure, somethings work better under different systems. Pollution is another example you did not list. Usually, the things that capitalism has a problem with are 3rd party effects. The difference that Capitalism has is that it is typically the most efficient system, even in many 3rd party situations.



As I brought up with water in CA you can see this. The price of water is being sold though a socialist system, and its causing an over consumption of water. The reason is that farmers are a big part of the CA economy and lobby to keep prices low. The farmers unions stop price from being higher because many crops would be unprofitable if they had to pay higher prices.



Socialism would work great if people were not corrupt and had perfect knowledge. They do not, which is why so many economists default to capitalism. It gives us the outcomes more often we want. Not 100% of the time, but far more often.







You will need to explain more. I don't know what the point is that you were trying to make.

It seems that you continue to change your mind on things and mix concepts. You apply concepts on a broad term (overall company) to the worker's productivity which changes the concept although you refuse to see the difference. Tell me what business applied your utilitarian concept to individual worker's production as you described? None, they say productivity is a unit factor, regardless of how you apply it. In this instance your concept fails. Your car example is also woefully lacking to make your original point, as consumption of essentials, such as gas and water, do not drop when prices increase which is contrary to your continued Economic dribble about how this concept is absolute. You can create whatever conspiracy you feel there is about CA water, but regardless, prices of the farmers products will go up, as the farmers will transfer those costs to the market. If CA has a dominant position in this sector, which they do, then where can consumers go to get it cheaper or who can supply the difference at that lower price to meet consumer's demand? Yes a new entrant can impact things, but that is an entirely different discussion. If no one can and you need to eat, you will buy as much product as you can to supply your need to eat, as the alternative to eating is starving, which most people will not let happen. Please see earlier points regrading price not impacting use or consumption. Have fun living in your dream world of pure Economics. Reality will be here for you when you awake, as I have wasted enough of my time trying to assist your perspective to one that actually relates to reality.

 

[shira]

People are obviously good by nature. This is proven because we haven't all killed ourselves.

Rapists are obviously good by nature. This is proven because rapists haven't raped every single person.

Edit: Oh, and by the way, you are obviously not a total moron. This is proven because you haven't uttered every stupid thing uttered in the history of the human race.

 

[realibrad]

It seems that you continue to change your mind on things and mix concepts. You apply concepts on a broad term (overall company) to the worker's productivity which changes the concept although you refuse to see the difference. Tell me what business applied your utilitarian concept to individual worker's production as you described? None, they say productivity is a unit factor, regardless of how you apply it. In this instance your concept fails. Your car example is also woefully lacking to make your original point, as consumption of essentials, such as gas and water, do not drop when prices increase which is contrary to your continued Economic dribble about how this concept is absolute. You can create whatever conspiracy you feel there is about CA water, but regardless, prices of the farmers products will go up, as the farmers will transfer those costs to the market. If CA has a dominant position in this sector, which they do, then where can consumers go to get it cheaper or who can supply the difference at that lower price to meet consumer's demand? Yes a new entrant can impact things, but that is an entirely different discussion. If no one can and you need to eat, you will buy as much product as you can to supply your need to eat, as the alternative to eating is starving, which most people will not let happen. Please see earlier points regrading price not impacting use or consumption. Have fun living in your dream world of pure Economics. Reality will be here for you when you awake, as I have wasted enough of my time trying to assist your perspective to one that actually relates to reality.

I guess this wraps things up. You do not seem to know what you are talking about. If you don't think economics applies to reality, then its pretty clear you do not understand economics.

 

[Grey_Beard]

I guess this wraps things up. You do not seem to know what you are talking about. If you don't think economics applies to reality, then its pretty clear you do not understand economics.

Never said economics does not apply to reality., as with most "concepts" its application must be done with variables of the situation and not the sterilized world that the concept was created in. Even though you may think you understand, reality can create situations that run contrary to the concept, which your price examples shows. This makes the absolute application of any concept useless. When you return from your nap, reality is here for you.

 

[realibrad]

Never said economics does not apply to reality., as with most "concepts" its application must be done with variables of the situation and not the sterilized world that the concept was created in. Even though you may think you understand, reality can create situations that run contrary to the concept, which your price examples shows. This makes the absolute application of any concept useless. When you return from your nap, reality is here for you.

Oh man, so I guess all those Austrian economists were part of a group that thought they knew everything. Funny, because Austrian economists believe that the system is so complex that you can only understand things on a micro level and that we should not meddle on a macro level because of the complexity in the system.

Who knew? Well, I did and most anyone who knows anything about economics knew.

Also, I would personally fall under an Austrian view for many things.

Here, read up and learn.

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

 

[Moonbeam]

Rapists are obviously good by nature. This is proven because rapists haven't raped every single person.

Edit: Oh, and by the way, you are obviously not a total moron. This is proven because you haven't uttered every stupid thing uttered in the history of the human race.

But then surely one could not have the faintest idea what one is talking about and still be right.