The difference between anyone and everyone ...

[Koroviev]

Also, the great thing about a free society is as long as it's not being enforced through the use of force you're free to experiment with any type of society you want!

[Thomasio]

>> If they are selling all they are producing that must mean the demand for that is high and the supply is low therefore they need to make more.

 

Car manufacturers produce 30% more cars than can be sold, any increase in production can be sold only through pushing another manufacturer out of competition.

Roughly 30% of all food produced in the western world is thrown away, there is virtually no shortage of anything, no need to produce more of anything.

A lower  entry point means workers earn less, subsequent they buy less, subsequent less products can be sold, subsequent less workers are needed.

 

>> If they are not selling everything .... they need to expand to other areas or go out of business.

 

Expanding to other areas means nothing else but pushing others out of business in some other area.

Whether one company goes out of business or another, from a global point of view it makes no difference, fact is we have too much production, which causes ever harder competition where everybody loses in the end.

Trying to make more jobs to let even more companies produce even more only makes the problem worse.

Unless a company comes up with an entirely new branch of products, there are no jobs created, just one worker in one company replaced by a lower paid worker in another company.

Of course my farmer friend would love to hire a bunch of workers and farm all his land, but doing that is not a question of wages, it's a question of finding demand for products on the market.

Wages for unskilled labor in Italy are in fact by now low enough and prices in supermarkets are in fact high enough, he could afford hiring workers for his fields and arrive at the market with lower prices than supermarkets, but there's a gigantic over supply of food, meaning if he would hire and offer his products cheaper, supermarkets would lower the price until he is out of business again.

This predictable situation compared to the fact he managed to make a living on his own now let's him stay away from hiring.

We've had that in the past, selling prices below cost of production, that's how supermarkets pushed small companies out of business, that's why in capitalism exclusively the biggest companies win the competition, simply because they have the money to survive 10 years or more without profit.

In Germany they have a law and they enforce it, saying you cannot sell something below the cost of production, that's why in Germany farmers do much better than in Italy and prices of products in Germany are far cheaper than in Italy because supermarkets have the continuous competition of farmers they aren't allowed to push out of business by plain money power.

 

>> the opportunity for more working hours ...... to make more money

 

There is no such thing.

A single company might become more competitive, might be able to hire more workers, but while the total demand for products doesn't increase simply because the population as a whole doesn't consume more, any hiring in one company is always causing other people to lose their jobs.

That's again the title of this topic, any company can grow, but not all of them.

It's what the Germans and the Chinese do, they create a gigantic export surplus which does nothing else but export their unemployment.

The idea especially the European Union came up with now, requesting that all countries now have to become more competitive to follow the German example is absolutely absurd, even the dumbest kid in first grade can tell that not all countries on earth can have an export surplus, if someone exports, someone else has to import, the surplus of one country is the deficit of another.

Under all circumstances lower wages equals less money going around in the population, leading to less products sold and/or lower prices, leading to deflation and depression.

 

>> what happens when people work more even upon 100% tax?

 

Easy.

For a single month or in case of emergency, no problem, but if a company forces their workers frequently to work more than the cap, on top of the 100% income tax for the worker, the company will have to pay an additional tax equal to the wages they would have had to pay for the extra worker they didn't hire, and if that still doesn't make them obey the law this will be doubled as often as necessary, until they do.

There is no possible punishment for companies other than charging fines that exceed the advantages they have from abusive behavior.

I for one wouldn't have charged Citygroup 7 billion for their fraud, I would have charged them 7 trillion, I would have closed their business, confiscated all their property including the private property of all their managers, to reimburse the people they cheated.

 

>> Surgery that requires more than 10 hours ... custom coding jobs ....

 

If someone works 40 hours in one week and then doesn't work for the rest of the month, where is the problem?

You could work 480 hours in one month and then take the rest of the year off, still no problem.

You could keep the working hours at 40 hours a week and reduce retirement age to 40 years, still no problem.

Below a given level of hours it's way more efficient to let everyone work several days or weeks in a row followed by a long vacation, than everybody working just a few minutes a day.

As far as I know they are currently doing something similar on offshore oil drilling platforms, 6 months of work, followed by 6 months off.

All it takes is switching from a few specialists drowned in work plus a bunch of unemployed to enough trained personal.

It just can't happen that some job can only be done only by one specific individual.

If that one has an accident and dies while there's a demand for his job, what will you do?

Someone else has to take over, so it makes way more sense to train enough people instead of insisting on a specific individual for the reason that there are no other qualified people.

 

>> college graduates .... have a higher intelligence ...

 

That's as close to racism as you can get, you're only not separating by race, but by wealth of parents, that's birthright, otherwise known as feudalism.

Do you honestly believe children of rich parents are in general more intelligent than children of poor people, or how else do you want to justify the fact that in 2013 a total 77% of children from top income families earned at least a bachelor's degree by the age of 24, while only 9% from the low income bracket did the same?

There a literally billions of people in Asia and Africa never given the slightest chance to get anywhere, often dying before the age of 6 due to lack of medical care.

I bet you anything you like, in the last 50 years there have been several dozen children smarter than Einstein who died because nobody cared about their intelligence, because rich people find it more important that their plain dumb offspring gets a degree from Yale.

 

Of course studying isn't limited by hours, because someone studying doesn't take away the opportunity to work from someone else, just the opposite, the more people study, the more jobs there are for teachers.

 

>> Are companies expected to have dedicated trainers?

 

If a company has specific requirements, where schools and universities can't provide the necessary training, of course a company wanting a specific job done will have to train workers for that and since trainers would do only 10 hours a week, of course they have to train more people and need more trainers.

But training isn't working, meaning training of workers within companies isn't limited, as long as you don't define burger flipping a training that requires 3 years of learning, companies could hire people, have them work their 10 hours, pay them and use the rest of the week to train them further.

You might say all the training may result in 40 hours for everyone again, but that's no problem, as long as training isn't abused to hide additional production, the workers needed in production still equal full employment.

While ALL companies have to do that, where is the problem? If costs increase for all companies to pay more trainers, competition is the same either way.

For the population as a whole there is no difference between paying higher prices for the products and paying food stamps for the unemployed.

I know, companies like the Koch brothers want to terminate all social programs and let poor people depend on charity, but whether it's done through charity or public financed food stamps, the total cost remains the same, unless you want to let poor people die.

 

>> ... wouldn't companies having to hire more people than they can afford cause infinite inflation?

 

I believe you might not be aware what causes inflation.

I'm aware the Austrian school teaches inflation is generated by money supply, but if that were true the near infinite money printing of the FED in recent years would have caused a gigantic inflation already, even worse in Japan, where they have printed money like crazy for over 20 years by now.

But there is no inflation, not in the US and in Japan they have had deflation throughout these 20 years, simply because the money supply doesn't have any kind of influence on inflation.

Yes, I know, there's inflation in investment objects, such as houses, but that's an artificial bubble created by rich people who don't know what else to do with their money while there is no profit to make in every day products.

Giving credit to workers, which is what banks around the world have done in the last 50 years or so is equal to a temporary increase in wages, but that backfires big time, as soon as workers reach the limit of their credit, because then they fall back on their initial low income and have to pay interest out of that instead of buying products.

 

In general inflation is the increase in wages minus the increase of productivity.

If companies manage to produce 5% more, without any other factor in the game, this obviously means, prices have to decrease by 5% or else the extra 5% of the products can't be sold, that's deflation.

If companies manage to produce the same with 5% less workers or if wages are cut by 5%, that's even worse, because in this case not only do you get 5% deflation, but instead of not being able to increase production, companies have to decrease production, meaning you get depression on top of deflation.

If net wages increase by less or less workers are hired than productivity increases, the system remains in deflation, regardless how much money is printed.

If an increase in wages isn't a net increase because taxes are raised, or if taxes are raised upon steady wages, that's the same as lowering wages, it leads directly into deflation.

If upon 5% increase in productivity net wages increase by 5% or 5% more workers are hired, inflation remains precisely at zero.

Only if wages increase more than productivity, the difference will result in inflation.

 

Why would hiring more workers force companies to increase prices, besides a small increase for the costs of extra trainers?

Upon full employment all the money currently spent for social services such as food stamps plus all the expenses from criminal activities arising from poverty wouldn't exist, all taxes could be reduced big time, the police force could be reduced big time, all people could make a living out of less money and for companies it makes no difference at all, whether they save on wages or save on taxes and people could easily afford increased prices from their saved taxes.

 

>> Italy and the free market

 

Well, I can tell you Italy is one of the best examples for free market, only beaten by Greece.

The tax laws in Italy have been way beyond affordable for decades, a corrupt government is working into their own pockets and whoever can find a way for it, will circumvent paying any taxes.

As a result of that we do already have some kind of free market, not because it's a good system, but because our government has weakened itself through state debt so much that they just don't have the resources to control anything anymore.

I live in the north where things are still halfway ok, but there are entire regions in southern Italy where organized crime rules, where the police force has become part of the organization, where anyone trying to do anything against the entirely lawless evolution of crime gets shot in broad daylight.

Poverty in these regions is unimaginable, because the rich squeeze the very last cent out of the poorest, the formerly flourishing tourism has entirely collapsed because nobody dares going there anymore and nobody can sell anything because literally nobody has any money. (Italy has no social security like Germany has).

The currency of those regions are cigarettes and drugs, smuggled from eastern countries and over the Mediterranean and the only "jobs" available in these regions is the illegal sale of smuggled cigarettes and drugs.

There are entire towns where there is not one single shop, not one single registered business, not a single bar, plain nothing, because dealing cigarettes and drugs has become the most profitable business and outcompeted any other form of business by so much that nobody even considers doing anything else.

Food is exclusively sold in street markets, where anyone who would dare to ask for taxes would get shot right away.

 

You will say that's the result of too many laws, too much state and I agree with you, that's the fault of the state, increasing taxes above a given limit, feeding the rich as much as possible and suppressing the poor as much as possible until the people find their way around it.

But I believe this lawless state of organized crime is what you would also get if you eliminate too many laws and since I have seen the situation in southern Italy first hand I'd rather have something else.

I very much believe a modest but strong state caring for the people rather than for the rich is the only solution, because in a lawless environment people can be as diligent and as honest as they want, they will always be outcompeted by a few criminals.

Of course those Chinese would move on to other criminal activities, but if that wasn't even considered criminal or if a stateless society didn't have the means to stop them, who is going to prevent them from taking over society in whichever way they want?

 

If I'm not mistaken, the whole idea of government at least in the US originates from the situation in the wild west, where at first people paid someone to be the Sheriff, then someone to write the laws the Sheriff should enforce, and so on and so on, simply because without laws the stateless society was ruled by outlaws.

 

Maybe you could see it like this:

The world right now is already producing more than all the people need.

If we would spread out the amount of work over all the unemployed and switch competition from the battle of having a job at all or be unemployed to competing for how much you earn through your skills, everybody would work less, everybody would pay less in social services and/or charity, all prices would drop and we would all have a much better life, while competition for the better job would still make sure the diligent ones are better off than the lazy ones.

(Yes of course I mean only the ones in the work force, children, elderly and handicapped people would still have to be covered by social services.)

Right now we have the absurd situation where the richest people own way more wealth than they could ever use for anything and the only thing they use their money for is to increase their wealth further which leads to bubbles in prices of houses and the stock market.

I mean the Koch brothers own over a dozen private properties worth 10s of millions each, they occupy huge amounts of land with their private properties just so they can live in there for a week or two per year.

Now let alone that being absurd already, that's a matter of a couple of 100 millions, so what could possibly the advantage for our society be, or what further advantage could the Koch brothers themselves get out of an increase of their wealth above the estimated 75 billion they currently own?

You believe in a free society and/or upon more wealth they would care for charity?

Ummm, nope, not really, they are actually doing the opposite already, they are killing people because they prefer to make more profit through dumping hazardous waste into the ground water and they use the profits they make there to buy themselves the politicians they need to let their behavior go unpunished.

Now from your point of view, is living in some place where the Koch brothers might open a factory one day from start the wrong choice and the fault of those people and if so, where would you advise people to move to?

Keep in mind, in a free society the Koch brothers might decide to drill for oil anywhere, even on the sea right outside of NY, and imagine how much you would like an oil spill in front of your door where the polluters deny any resposibility?

 

Last remark, just because it's something I invented myself, or at least I haven't heard it from anywhere else yet:

It may still take a while, but I believe the world will discover the downsides of capitalism when Koch Industries is taken over by Walmart.

It's only a matter of time until the richest is big enough to destroy the 2nd richest and when that happens, when the Koch brothers discover, being the 2nd biggest is from a libertarian point of view still "the wrong choice", once the world is governed by one single family, that's when even the billionaires will get the point.

[Thomasio]

Just one more point I missed to answer (might appear before moderators approve my long answer).

If you believe a company cannot cover sick leave of a worker doing 10 hours a week, then you didn't understand the whole point.

Do you honestly believe it's easier to replace the one and only highly specialized surgeon in a hospital doing 60-80 hours a week, than to cover one of 8 surgeons doing 10 hours each?

 

Under full employment finding a worker depends on the wages a company is willing to pay, so it's reversed from today, not companies setting the value of a worker to as little as the poorest of the unemployed is willing to work for, but workers set the value and it will near automatically balance on a level where workers get paid as much as their work is worth for the employer, simply because the worker will request as much as he can, but the employer cannot pay more than the worker produces in value.

 

And then, 10 hours a week is not a fixed value, such a system has to be flexible.

It could be an annual decision, newly set every year or so, depending on supply and demand of work.

If new branches of products are invented and more work is required, the hours per worker can be increased anytime, same as they can be further reduced if more production gets outsourced to the far east.

If a specific profession lacks workers, there could be an exception made for that profession for a couple of years, under the condition that instantly more people are trained in that profession and if you cannot find enough people willing to do the job, this profession has to get an increase in wages until enough workers are willing to learn the job.

If one profession has too many workers while another has not enough, wages have to be adjusted until both professions are covered.

[AncapFTW]

It's been done before, Keynesianism was just that. Unfortunately it works too good. Capitalism is not meant to be efficient, it's meant to be exploitative. Keynes' policies led to a generalized "crisis of democracy", and consequently the rise of neoliberalism that is pwning us to this day. Anything short of a complete social revolution will leave us yo-yoing between these two points of instability. Not very appealing.

Que?

 

Can you please back up this statement?  From everything I read, it arose out of the barter system which distributed things based on skill in obtaining/making things.  Value came from demand for what others could produce more efficiently, and people traded things which they had little demand for for things which they had more demand for.  Both people benefited and the efficiency of the system came from people producing the most value they could given their unique situation.

[Koroviev]

I'm going to try to hit all of your points and still keep this as short as possible. Let me know if I miss anything.

 

>> If they are selling all they are producing that must mean the demand for that is high and the supply is low therefore they need to make more.

 

Car manufacturers produce 30% more cars than can be sold, any increase in production can be sold only through pushing another manufacturer out of competition.

Roughly 30% of all food produced in the western world is thrown away, there is virtually no shortage of anything, no need to produce more of anything.

- Don't car manufacturers produce more than they sell because the people who buy their cars want choices and it's impossible to predict what those people will want to buy. It seems to me the only ways to fix this would be to take away everyone's choice or only make cars to order. Also, not sure where the 30% is coming from?

A lower  entry point means workers earn less, subsequent they buy less, subsequent less products can be sold, subsequent less workers are needed.

- Lower entry point means more people can work it has nothing to do with how much they earn.

 

>> If they are not selling everything .... they need to expand to other areas or go out of business.

 

Expanding to other areas means nothing else but pushing others out of business in some other area.

- it's not a zero-sum game, different people want/need different things. Expansion does not automatically mean someone else goes out of business.

Whether one company goes out of business or another, from a global point of view it makes no difference, fact is we have too much production, which causes ever harder competition where everybody loses in the end.

- Competition does not mean everyone loses! Just because someone can do something better or cheaper than me does not mean I can't do anything.

Trying to make more jobs to let even more companies produce even more only makes the problem worse.

- Isn't your argument 

Unless a company comes up with an entirely new branch of products, there are no jobs created, just one worker in one company replaced by a lower paid worker in another company.

- people still want choices

Of course my farmer friend would love to hire a bunch of workers and farm all his land, but doing that is not a question of wages, it's a question of finding demand for products on the market.

Wages for unskilled labor in Italy are in fact by now low enough and prices in supermarkets are in fact high enough, he could afford hiring workers for his fields and arrive at the market with lower prices than supermarkets, but there's a gigantic over supply of food, meaning if he would hire and offer his products cheaper, supermarkets would lower the price until he is out of business again.

This predictable situation compared to the fact he managed to make a living on his own now let's him stay away from hiring.

- still not sure how this helps your point? wouldn't forcing him to pay more employees make his situation worse? How does limiting the amount of time he can work change the fact that there is no demand for his product?

We've had that in the past, selling prices below cost of production, that's how supermarkets pushed small companies out of business, that's why in capitalism exclusively the biggest companies win the competition, simply because they have the money to survive 10 years or more without profit.

- I'm not sure what it's like in Italy but I'm not sure of any situation where the biggest companies exclusively win? I know lots of small companies that do just fine despite having huge companies as competitors. Also, if it's solely dependent on who can sell things cheaper why are there other stores besides WalMart? I think it's communism where the big companies exclusively win because everything is owned by the state. see George Reisman.

In Germany they have a law and they enforce it, saying you cannot sell something below the cost of production, that's why in Germany farmers do much better than in Italy and prices of products in Germany are far cheaper than in Italy because supermarkets have the continuous competition of farmers they aren't allowed to push out of business by plain money power.

- Although, I don't think more government regulations is ever a good thing, I feel like this would be a better solution than a cap on working hours. If it works so well why isn't this your proposal?

 

>> the opportunity for more working hours ...... to make more money

 

There is no such thing.

A single company might become more competitive, might be able to hire more workers, but while the total demand for products doesn't increase simply because the population as a whole doesn't consume more, any hiring in one company is always causing other people to lose their jobs.

- again I think this is arguing against your own point. This is absolutely true, but only if everyone else already has a job. i.e. if 100% of people are already working their federally enforced limit who is there left to hire?

That's again the title of this topic, any company can grow, but not all of them.

- again I agree but this does not mean that ONLY one company can grow.

It's what the Germans and the Chinese do, they create a gigantic export surplus which does nothing else but export their unemployment.

The idea especially the European Union came up with now, requesting that all countries now have to become more competitive to follow the German example is absolutely absurd, even the dumbest kid in first grade can tell that not all countries on earth can have an export surplus, if someone exports, someone else has to import, the surplus of one country is the deficit of another.

- yes not all countries can export the same goods, but not all countries have the same goods to export. So yes if everyone is doing the exact same thing, everyone ONLY wants that one thing and one person does more of that one thing then everyone else loses. However, this is not the case...at all. It is because other companies have a deficit of German export goods that Germany can export those goods. No one is equal that is why there is and always will be competition.

Under all circumstances lower wages equals less money going around in the population, leading to less products sold and/or lower prices, leading to deflation and depression.

- All circumstances? Where does the money go if it's not in the population? What if a company lowers dividends paid (a wage for some people) in order to reinvest in that company creating more jobs and more wealth overall?

 

>> what happens when people work more even upon 100% tax?

 

Easy.

For a single month or in case of emergency, no problem, but if a company forces their workers frequently to work more than the cap, on top of the 100% income tax for the worker, the company will have to pay an additional tax equal to the wages they would have had to pay for the extra worker they didn't hire, and if that still doesn't make them obey the law this will be doubled as often as necessary, until they do.

- so if a company "forces" someone to work (not sure how this is possible unless the state is involved) the employee not only has to put all the money they "made" from being forced to work into taxes, the company also has to pay another salary in taxes?? But if everyone who is able to work already has a job how are they supposed to find someone else to work? Also, are you saying after an emergency happens you'd have to get permission to save up for the emergency? or can you get permission to work more to save up in case an emergency happens in the future? if so wouldn't everyone just continue to work more to save up for emergency...like they do now...

There is no possible punishment for companies other than charging fines that exceed the advantages they have from abusive behavior.

I for one wouldn't have charged Citygroup 7 billion for their fraud, I would have charged them 7 trillion, I would have closed their business, confiscated all their property including the private property of all their managers, to reimburse the people they cheated.

wouldn't it be more effective to just not bail them out (pay them) and let them fail as opposed to bailing them out then asking for some money back?

 

>> Surgery that requires more than 10 hours ... custom coding jobs ....

 

If someone works 40 hours in one week and then doesn't work for the rest of the month, where is the problem?

You could work 480 hours in one month and then take the rest of the year off, still no problem.

You could keep the working hours at 40 hours a week and reduce retirement age to 40 years, still no problem.

Below a given level of hours it's way more efficient to let everyone work several days or weeks in a row followed by a long vacation, than everybody working just a few minutes a day.

As far as I know they are currently doing something similar on offshore oil drilling platforms, 6 months of work, followed by 6 months off.

All it takes is switching from a few specialists drowned in work plus a bunch of unemployed to enough trained personal.

- so what you're proposing is central planning? see...well...communism, read Ayn Rand, George Reisman.

It just can't happen that some job can only be done only by one specific individual.

If that one has an accident and dies while there's a demand for his job, what will you do?

- as stated above this is arguing against your own point. if 100% of the working population is already working who's left to replace anyone? Especially if the "replacement" worker and the company itself will suffer massive penalties.

Someone else has to take over, so it makes way more sense to train enough people instead of insisting on a specific individual for the reason that there are no other qualified people.

- how are you going to predict how many you need? are you going to make certain people learn certain skills? Central planning, communism, Ayn Rand, George Reisman, Nazi Germany, etc.

 

>> college graduates .... have a higher intelligence ...

 

That's as close to racism as you can get, you're only not separating by race, but by wealth of parents, that's birthright, otherwise known as feudalism.

- I think you mean bigotry, but the statement I made is neither. First off it is a generalization (which I though I'd made clear) I'm pretty sure the idea that only the wealthy can or do go to college is more bigoted that the generalization I made that is backed up by research. See Dr. Kevin Beaver for more on IQ studies.

Do you honestly believe children of rich parents are in general more intelligent than children of poor people, or how else do you want to justify the fact that in 2013 a total 77% of children from top income families earned at least a bachelor's degree by the age of 24, while only 9% from the low income bracket did the same?

- so if we put them into college they will instantly become smarter and be able to make better decisions than their parents? how is it fair to "poor kids" most of which come from bad backgrounds to be held to the same standard in school as those from households with well educated parents? are the "poor kids" going to be able to perform as well if they don't have time to study because they have to work? It isn't fair to begin with creating more rules does not make it fair. Now, I am in no way saying that "poor kids" cannot go to college or do well in school, in fact the "poor kids" who do make it are generally much better off than the "rich kids" who get everything handed to them.

There a literally billions of people in Asia (lots of communism) and Africa (Massive aid and welfare) never given the slightest chance to get anywhere, often dying before the age of 6 due to lack of medical care.

I bet you anything you like, in the last 50 years there have been several dozen children smarter than Einstein who died because nobody cared about their intelligence, because rich people find it more important that their plain dumb offspring gets a degree from Yale.

- Also how would not being able to work more hours to save up for college make this problem any better?

 

Of course studying isn't limited by hours, because someone studying doesn't take away the opportunity to work from someone else, just the opposite, the more people study, the more jobs there are for teachers.

1. how many people want to be teachers? 2. the teachers' hours are capped as well so you'd have to have a bunch of teachers all taking turns teaching the same thing then another group of teachers grading their work, then another group of teachers coming up with lesson plans for those other teachers to teach, etc. etc. 3. How is it fair that Students have to go to school for more than the allotted number of hours per week, and work for the allotted number of hours per week and magically make more money than it takes for them to live off of (so they can pay for school) when even their teachers only have to do a couple hours of work per day.

 

>> Are companies expected to have dedicated trainers?

 

If a company has specific requirements, where schools and universities can't provide the necessary training, of course a company wanting a specific job done will have to train workers for that and since trainers would do only 10 hours a week, of course they have to train more people and need more trainers.

But training isn't working, meaning training of workers within companies isn't limited, as long as you don't define burger flipping a training that requires 3 years of learning, companies could hire people, have them work their 10 hours, pay them and use the rest of the week to train them further.

- so does this mean trainers don't get paid? or that trainers also have to work outside of the time they are training? How is this fair to anyone?

You might say all the training may result in 40 hours for everyone again, but that's no problem, as long as training isn't abused to hide additional production, the workers needed in production still equal full employment.

While ALL companies have to do that, where is the problem? If costs increase for all companies to pay more trainers, competition is the same either way.

For the population as a whole there is no difference between paying higher prices for the products and paying food stamps for the unemployed.

I know, companies like the Koch brothers want to terminate all social programs and let poor people depend on charity, but whether it's done through charity or public financed food stamps, the total cost remains the same, unless you want to let poor people die.

- yes we've all heard the Koch brothers are entirely evil. But aren't they just playing within the rules of the system? how would changing the rules not allow them to "take advantage" of those rules? 

 

>> ... wouldn't companies having to hire more people than they can afford cause infinite inflation?

 

I believe you might not be aware what causes inflation.

I'm aware the Austrian school teaches inflation is generated by money supply, but if that were true the near infinite money printing of the FED in recent years would have caused a gigantic inflation already, even worse in Japan, where they have printed money like crazy for over 20 years by now.

But there is no inflation, not in the US and in Japan they have had deflation throughout these 20 years, simply because the money supply doesn't have any kind of influence on inflation.

Yes, I know, there's inflation in investment objects, such as houses, but that's an artificial bubble created by rich people who don't know what else to do with their money while there is no profit to make in every day products.

Giving credit to workers, which is what banks around the world have done in the last 50 years or so is equal to a temporary increase in wages, but that backfires big time, as soon as workers reach the limit of their credit, because then they fall back on their initial low income and have to pay interest out of that instead of buying products.

- again not sure where you're getting your stats but both Japan and the US have had inflation (Japan still does albeit small) up until this year. Do you mean the inflation has gotten smaller?

 

In general inflation is the increase in wages minus the increase of productivity.

- I definitely don't claim to know anything about inflation but isn't it the increases in prices of goods and services over time?

If companies manage to produce 5% more, without any other factor in the game, this obviously means, prices have to decrease by 5% or else the extra 5% of the products can't be sold, that's deflation.

If companies manage to produce the same with 5% less workers or if wages are cut by 5%, that's even worse, because in this case not only do you get 5% deflation, but instead of not being able to increase production, companies have to decrease production, meaning you get depression on top of deflation.

If net wages increase by less or less workers are hired than productivity increases, the system remains in deflation, regardless how much money is printed.

If an increase in wages isn't a net increase because taxes are raised, or if taxes are raised upon steady wages, that's the same as lowering wages, it leads directly into deflation.

If upon 5% increase in productivity net wages increase by 5% or 5% more workers are hired, inflation remains precisely at zero.

Only if wages increase more than productivity, the difference will result in inflation.

 

Why would hiring more workers force companies to increase prices, besides a small increase for the costs of extra trainers?

- because it costs money to hire people. it costs less money to pay 1 person $38 an hour than it does to pay 10 people $38 an hour

Upon full employment all the money currently spent for social services such as food stamps plus all the expenses from criminal activities arising from poverty wouldn't exist, all taxes could be reduced big time, the police force could be reduced big time, all people could make a living out of less money and for companies it makes no difference at all, whether they save on wages or save on taxes and people could easily afford increased prices from their saved taxes.

- not true, not true, and not true. there would just be more people being criminalized because they work too much. I see how a 100% income tax for working more than 10 hours is a decrease in taxes

 

>> Italy and the free market

 

Well, I can tell you Italy is one of the best examples for free market, only beaten by Greece.

- Although I am suspicious of this statement I don't know enough to argue hopefully someone else can jump in here. but I find it hard to believe the problems they have are stemming from being free markets.

The tax laws in Italy have been way beyond affordable for decades, a corrupt government is working into their own pockets and whoever can find a way for it, will circumvent paying any taxes.

As a result of that we do already have some kind of free market, not because it's a good system, but because our government has weakened itself through state debt so much that they just don't have the resources to control anything anymore.

I live in the north where things are still halfway ok, but there are entire regions in southern Italy where organized crime rules, where the police force has become part of the organization, where anyone trying to do anything against the entirely lawless evolution of crime gets shot in broad daylight.

Poverty in these regions is unimaginable, because the rich squeeze the very last cent out of the poorest, the formerly flourishing tourism has entirely collapsed because nobody dares going there anymore and nobody can sell anything because literally nobody has any money. (Italy has no social security like Germany has).

The currency of those regions are cigarettes and drugs, smuggled from eastern countries and over the Mediterranean and the only "jobs" available in these regions is the illegal sale of smuggled cigarettes and drugs.

There are entire towns where there is not one single shop, not one single registered business, not a single bar, plain nothing, because dealing cigarettes and drugs has become the most profitable business and outcompeted any other form of business by so much that nobody even considers doing anything else.

Food is exclusively sold in street markets, where anyone who would dare to ask for taxes would get shot right away.

 

You will say that's the result of too many laws, too much state and I agree with you, that's the fault of the state, increasing taxes above a given limit, feeding the rich as much as possible and suppressing the poor as much as possible until the people find their way around it.

But I believe this lawless state of organized crime is what you would also get if you eliminate too many laws and since I have seen the situation in southern Italy first hand I'd rather have something else.

I very much believe a modest but strong state caring for the people rather than for the rich is the only solution, because in a lawless environment people can be as diligent and as honest as they want, they will always be outcompeted by a few criminals.

Of course those Chinese would move on to other criminal activities, but if that wasn't even considered criminal or if a stateless society didn't have the means to stop them, who is going to prevent them from taking over society in whichever way they want?

 

If I'm not mistaken, the whole idea of government at least in the US originates from the situation in the wild west, where at first people paid someone to be the Sheriff, then someone to write the laws the Sheriff should enforce, and so on and so on, simply because without laws the stateless society was ruled by outlaws.

- not sure where this data comes from? There was much more crime in the east coast cities than in the "wild west"

 

Maybe you could see it like this:

The world right now is already producing more than all the people need.

If we would spread out the amount of work over all the unemployed and switch competition from the battle of having a job at all or be unemployed to competing for how much you earn through your skills, everybody would work less, everybody would pay less in social services and/or charity, all prices would drop and we would all have a much better life, while competition for the better job would still make sure the diligent ones are better off than the lazy ones.

(Yes of course I mean only the ones in the work force, children, elderly and handicapped people would still have to be covered by social services.)

Right now we have the absurd situation where the richest people own way more wealth than they could ever use for anything and the only thing they use their money for is to increase their wealth further which leads to bubbles in prices of houses and the stock market.

- Who's buying the goods they need to increase their wealth? Most of it is not the other Rich people.

I mean the Koch brothers own over a dozen private properties worth 10s of millions each, they occupy huge amounts of land with their private properties just so they can live in there for a week or two per year.

Now let alone that being absurd already, that's a matter of a couple of 100 millions, so what could possibly the advantage for our society be, or what further advantage could the Koch brothers themselves get out of an increase of their wealth above the estimated 75 billion they currently own?

You believe in a free society and/or upon more wealth they would care for charity?

Ummm, nope, not really, they are actually doing the opposite already, they are killing people because they prefer to make more profit through dumping hazardous waste into the ground water and they use the profits they make there to buy themselves the politicians they need to let their behavior go unpunished.

Now from your point of view, is living in some place where the Koch brothers might open a factory one day from start the wrong choice and the fault of those people and if so, where would you advise people to move to?

Keep in mind, in a free society the Koch brothers might decide to drill for oil anywhere, even on the sea right outside of NY, and imagine how much you would like an oil spill in front of your door where the polluters deny any resposibility?

- didn't the koch brothers just give $1.2 billion to cancer research? and even more towards arts music and scholarships? I'm afraid the evil koch brothers aren't necessarily as evil as the biased media makes you believe. Also, in a free society someone other than the government would own the land the koch brothers are, supposedly, distroying so there would be real consequences to their actions, or they would own it and they would have to do a cost benefit analysis on destroying the land by dumping on it or using it to create more wealth.

 

Last remark, just because it's something I invented myself, or at least I haven't heard it from anywhere else yet:

It may still take a while, but I believe the world will discover the downsides of capitalism when Koch Industries is taken over by Walmart.

It's only a matter of time until the richest is big enough to destroy the 2nd richest and when that happens, when the Koch brothers discover, being the 2nd biggest is from a libertarian point of view still "the wrong choice", once the world is governed by one single family, that's when even the billionaires will get the point.

this is just nonsense and does not support your point at all. stop watching biased media you're being brainwashed into thinking all rich people are evil!

 

 

 

Just one more point I missed to answer (might appear before moderators approve my long answer).

If you believe a company cannot cover sick leave of a worker doing 10 hours a week, then you didn't understand the whole point.

Do you honestly believe it's easier to replace the one and only highly specialized surgeon in a hospital doing 60-80 hours a week, than to cover one of 8 surgeons doing 10 hours each?

everyone else is already working as much as they are allowed to in your system so there is literally no one left to work. And I for one want the single best surgeon doing my surgery not 10 mediocre surgeons all taking turns cutting me open.

 

Under full employment finding a worker depends on the wages a company is willing to pay, so it's reversed from today, not companies setting the value of a worker to as little as the poorest of the unemployed is willing to work for, but workers set the value and it will near automatically balance on a level where workers get paid as much as their work is worth for the employer, simply because the worker will request as much as he can, but the employer cannot pay more than the worker produces in value.

so for an employer to hire someone new they have to pay more than their competition, without raising prices, or producing more, all while everyone else already has a job?

 

And then, 10 hours a week is not a fixed value, such a system has to be flexible.

It could be an annual decision, newly set every year or so, depending on supply and demand of work.

If new branches of products are invented and more work is required, the hours per worker can be increased anytime, same as they can be further reduced if more production gets outsourced to the far east.

If a specific profession lacks workers, there could be an exception made for that profession for a couple of years, under the condition that instantly more people are trained in that profession and if you cannot find enough people willing to do the job, this profession has to get an increase in wages until enough workers are willing to learn the job.

If one profession has too many workers while another has not enough, wages have to be adjusted until both professions are covered.

 

Wait, so now it's not really a cap it's a generally accepted rule you can only work 10 hours? But there is a certain group of people who could decide whether or not you can work more? do you have to apply to work more? what criteria do they get to decide whether or not to grant these extra hours? who are these all knowing people who decide who gets to work or not?  as eluded to above communism does not and cannot work (see Ayn Rand, Nazi Germany, George Reisman).

 

Also, what if I have a kid and my wife wants to be a stay at home mom? is she forced to work or is my employer going to be forced to give me a raise? or can I apply for permanent "overtime" to support another person in my family, actually 2 other people if my wife was previously working?

 

- Cheers

[Thomasio]

Ok, I give up, you truly believe in your libertarianism, you truly believe in infinite growth in a finite world and you truly believe in superior intelligence of the rich.

I respect your belief, after all it's a human right for anyone to believe whatever they want, but other than that there's nothing I want to say anymore.

 

 

....... ummmmm maybe there's still one thing were we could find common ground?

 

 

Even though you want to abolish the state, I guess you will agree that for example the Bush family enjoys high education for all their offspring, getting all of their family members extremely well paid jobs, up to becoming president of the US, not limited to politics, but also in big business outside of politics.

 

I assume as a libertarian you can't be very religious?

Any halfway logic thinking person will discover what an utter nonsense any kind of religion is, as soon as  they take their first lessons in biology, therefore even though I respect the constitutional right of believing whatever you like, I consider any adult believer downright stupid.

Given the fact that about ALL political posts in the US are given exclusively to religious people who ALL enjoyed a higher education, how can you think you're giving preference to the smart ones?

[Koroviev]

You're right this has gone on long enough.

 

Up to this point I've given you the benefit of the doubt assuming I wasn't very clear in my explanations, but you continue to take the things I say out of context. I made generalizations backed up by evidence and you called me bigoted while arguing that all rich people are evil, all religious people are stupid, all poor people are helpless, and the only way to save the poor is through a system that is unsustainable and inevitably leads to communism. You've had no evidence to support your facts and have degraded this posting to personal attacks.

 

It really was an enjoyable conversation however, and I hope you gained as much out of it as I know I did.

 

If I can give you one piece of advice for your own health and sanity it would be to stop watching the biased media, they truly are trying to brainwash you into their thinking, i.e. what is best for them. Read some books, do some research, there happens to be some really great resources right on this site!  

 

Cheers, and I really do wish you the best of luck.

 

- TYFYC

[Thomasio]

Thanks, I did enjoy the discussion and yes, I got some insight out of it.

What I read or listen to, you'll have to leave up to me, but if you want to know, I'm always listening to both sides of an argument before I make up my mind and I almost always find my personal view of things somewhere in between, simply because if there are two opposing extreme opinions, usually neither of them is right.

In fact, not only have I red a load of books from both sides, I've actually written one myself.

It won't help you any, because it's in German, anyway, here's the link to my homepage including a short introduction to the book in english.

http://www.piranhazone.com/index.php?language=1&page=wohlstand

 

Best of luck to you as well.

I assume you're younger than me, so you still have to build part of your life and after I'm through with that already, I know how hard that is.

[Jagsfan82]

Thanks, I did enjoy the discussion and yes, I got some insight out of it.

What I read or listen to, you'll have to leave up to me, but if you want to know, I'm always listening to both sides of an argument before I make up my mind and I almost always find my personal view of things somewhere in between, simply because if there are two opposing extreme opinions, usually neither of them is right.

In fact, not only have I red a load of books from both sides, I've actually written one myself.

It won't help you any, because it's in German, anyway, here's the link to my homepage including a short introduction to the book in english.

http://www.piranhazone.com/index.php?language=1&page=wohlstand

 

Best of luck to you as well.

I assume you're younger than me, so you still have to build part of your life and after I'm through with that already, I know how hard that is.

I didn't read this whole exchange because lets face it, it was really long, but let me add some thoughts on your way out.  They aren't in any order necessarily. As a matter of fact its just a bunch of rambling.  But I recommend first and foremost "Economics in one Lesson"

 

1. There is always a loser, half the people are rich, half the people are poor. 

 

This is very confusing to me.  If there are 100 people in the world, and 50 of them are working while the other 50 are poor.  There are 50 unique skill sets in the world.  That leaves 2 people per skill set.  1 wins, and 1 loses.  1 person is able to sell his labor for a decent living, while the other has nothing.  How does that situation stay?  Wouldn't the other person say, "Well half of something is better than nothing, so I will make the same product for less".  This would escalate to the point where they would come together, form a monopoly, and both be rich until they are making more money than other skill sets, in which case one of the winners from the other 50 skill sets comes over to take part of their profits, leaving all those profits to the "loser".  

 

It seems you are ignoring the idea that in a truly free society all profits diminish to nominal levels due to competition.  Obviously there are ebbs and flows of profits and losses, but in the long run there can be no half rich half poor because the poor will have every motivation in the world to close the gap and either offer the same product for less, a better product for the same, or a inferior product for an inferior price. 

 

2. 1/2 the population produces enough products for everyone?

 

This is very confusing but I am going to try to address the point as you INTEND it to be interpreted not necessarily how you say it, because as someone addressed, why would half the people produce enough products for everyone unless forced, and if they are doing it, then whats the problem?  Doesn't everyone have what they need?  More on this later actually...

 

But what I believe you are getting out is a limited demand for labor compared to a mass supply of labor, leaving people out of jobs. My problem with this is there is no way to predict what the demand is going to be for products.  There will always be areas in peoples lives to offer them more value than they are getting.  Your theory is acting like there are a bunch of fixed resource pools that consumers take from and producers produce to with no change in supply or demand in each of them.  There are always new products that change the dynamics of where money flows to.  The telephone company giants of 20 years ago give way to the cell phone companies of today.  Demand for education goes up and down.  The service industry in general has been increasing year after year.  

 

I guess my point is something along the lines that there is no way to say how many goods are services are needed, and even if there was, that amount is always changing, and even if it wasn't, the free market would never reach an equilibrium where the "losers" are stuck in poverty and the "winners" are making money.  They would either realize there isn't a big gap in the quality of labor, or figure out a way to make the lower quality of labor more efficient through automation, training, whatever.  

 

3. Who cares about fairness... honestly.

 

Someone else tried touching on this earlier I believe, but fairness is really not an important subject to discuss when talking about trying to raise the quality of life for humanity.  This is what drives me insane about all the wealth gap talk.  How much money people are making is meaningless.  What we really care about are the real things that each person is trying to obtain. Can the poorest of people afford a house, clothes, food, access to basic health care, access to education, and some sort of moderate quality of life that allows for some relaxation and entertainment time.  If they have all of this, who the fuck cares how much money they make?  If they don't have it, then clearly half the people aren't really producing enough products for everyone cause there's still a massive market for cheap yet effective food, clothing, shelter, whatever and a massive segment of the labor pool that could be used to fill that need.  You mentioned the undercutting prices thing could be a never ending cycle, but thats just not true.  As an entrepreneur I simply won't get into the field if I can't get a certain return on my money. There comes a point where no matter how cheap my labor is, which allows me to sell my product for really low prices, I still won't choose to do it if I can't get a certain return on my investment.  Its certainly possible that technology may later on make an item more profitable to sell at a lower price, but then you have new industries with new jobs to take on the displaced workers.

 

4. The losers are opportunity for the winners to capitalize on

 

In your scenario, all of the losers represent an opportunity for entrepreneurs to capitalize on.  They are, according to your own admission, hard working people who just lost out to better competition.  If that's the case, its an opportunity for me to create a model that capitalizes on their skill set to make a profit. The fact that they are currently living in poverty represents great bargaining power for me to get them to start cheap. Without governments in the way to create barriers to entry, I have nothing to worry about.  

 

Bottom line is real capitalism without coercion forces the opposite of what you say will happen.  Wherever profits exist, competition will increase.  If no one has the skills to compete in that sector, they can look to make some other area more efficient that will free up cash. They can also create new ideas to eat into that market.  If the guy down the street has a monopoly on bowling and there's no way to compete with him, there are hundreds and hundreds of different forms of entertainment that might draw people away from bowling and into some other form of entertainment.  

 

Jesus thats more of a mess than I thought it was gonna be.  I hope you got anything out of that at all.

[Thomasio]

Thanks for your comments.

I guess all the arguments have been discussed in detail already, so let me give you one additional point.

 

Take a wild guess, why literally ALL of the gigantic corporations are in favor of abolishing trading barriers and tax laws?

Do you honestly believe that's because they have the well being of American citizens in mind, or can you imagine they want that because they expect to increase their profits?

What makes you think corporations would leave small business any chance to compete?

What makes you think fulfilling the wishes of the richest people in the world would have an advantage for you?

Do you honestly believe corporations want to terminate the state because that would give small business a chance and create more competition for them, or can you imagine they want that because it would make it easier for them to eliminate competition?