The question is, where do *you* think it comes from?
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The question is, where do *you* think it comes from?
Yes, I agree we are on a slippery slope.
But I still have yet to see a valid argument of how the world's wealth is a fixed number, and the only way to increase individual wealth is by decreasing someone else's.
But I still have yet to see a valid argument of how the world's wealth is a fixed number, and the only way to increase individual wealth is by decreasing someone else's.
Come on people, if it's considered to be true by *anyone*, let alone 'educated folks and nations' please show me the proof.
I've stated my case, I don't need to keep restating it.
Lastly, I'm still waiting for the world wealth figure. What is it to the nearest ten billion dollars?
I've stated my case, I don't need to keep restating it.
Lastly, I'm still waiting for the world wealth figure. What is it to the nearest ten billion dollars?
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Yes, there are proofs of that, but apparently you aren't going to provide a proof for the current discussion. OK, so be it. Didn't think you could. 🙂
radi(c)al_cam
Well-known
digitalintrigue,
my dear old chap and "Comrade" ,
you still didn't answer my question concerning v.Hayek -- is your behaviour "valid", "accurate"?
OT -- anyway, I don't argue with a know-it-all.
You won't engage me in your debate in economics. Your troubled waters are not mine, and talking with boasters and parvenues is none of my hobbies.
I'm afraid, if you would have been a classmate of mine, my friends and I would have been quite "patronising" you.
Chriscrawfordphoto
Real Men Shoot Film.
you guys are confusing wealth with the money supply. Because we do not barter anymore, money represents wealth. There IS a finite amount of money in the world. Each country's central bank regulates the amount of that country's currency that exists in circulation at any one time. The Federal Reserve does this in the USA and they do know exactly how much money exists, at least how much US money exists.
When new wealth is discovered (new gold mine, new oil well, etc) then people who wants that valuable thing trade money for it. If the money supply doesn't increase to match the value of such new wealth, then yes some lose money to finance the purchase of the new wealth from its owner. Thats the trick for governments and a lot of people don't realize that power. A central bank must keep the money supply high enough to represent the real wealth that exists but not so high that inflation results.
If there are large numbers of very poor people, as there are in the world in general and the USA in particular, then we need to evaluate why. is it because, like in Mexico, 98% of the wealth is held by 2% of the population or is it just that there simply isn't enough wealth to go around. If the first possibility is true then redistributing wealth is the only answer. If the second is true, then we need to admit that the USA is really not a rich country after all. I used Mexico as an example because its a well known case of a fairly wealthy country whose population is held in subjection by a tiny elite.
When new wealth is discovered (new gold mine, new oil well, etc) then people who wants that valuable thing trade money for it. If the money supply doesn't increase to match the value of such new wealth, then yes some lose money to finance the purchase of the new wealth from its owner. Thats the trick for governments and a lot of people don't realize that power. A central bank must keep the money supply high enough to represent the real wealth that exists but not so high that inflation results.
If there are large numbers of very poor people, as there are in the world in general and the USA in particular, then we need to evaluate why. is it because, like in Mexico, 98% of the wealth is held by 2% of the population or is it just that there simply isn't enough wealth to go around. If the first possibility is true then redistributing wealth is the only answer. If the second is true, then we need to admit that the USA is really not a rich country after all. I used Mexico as an example because its a well known case of a fairly wealthy country whose population is held in subjection by a tiny elite.
dfoo
Well-known
I'm sorry to burst your bubble but anyone with any amount of education will know this is blatantly untrue. In fact, it is entirely obvious that it MUST be untrue, otherwise we'd all be stuck in the stone age. It is undeniable that we have become more affluent over time. Consider how people lived in the stone age, to the middle ages, to modern times. Are you really trying to say that the level of wealth and all associated measures (standard of living for one) has not increased?
dfoo
Well-known
That may be true at any instant in time. However, over time the amount must necessarily change.
Chriscrawfordphoto
Real Men Shoot Film.
Yeah, I agree, and my post noted that fact. There is only a finite amount of money at any given time and if the Fed (referring to the US here) doesn't increase money supply as actual wealth increases then there is a shortage of money that makes commerce difficult and creates poverty that shouldn't exist.
Chriscrawfordphoto
Real Men Shoot Film.
We are not near as bad as Mexico. Yet.
I must have missed that post a couple of weeks ago. It was difficult to keep up with all the new posts at the time. There was far too much time spent as it was...heh. I can't count how many times my points remain unanswered.
I'm sorry that you don't want to post an intellectual argument supporting your position but that is your choice.
This is an open discussion, I don't remember boasting, just floating a position.
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Not enough flack.
Spreading the wealth around, however, does not logically point to there being a finite quantity of it.
If there is a finite quantity, tell me what that amount is, please.
Leigh Youdale
Well-known
I feel what we're seeing here is the classic case of three or four people standing in different corners of a room, facing the wall, and all shouting that they are at the door.
It seems to me that Chris is closest to the nub of the matter. We each are working from different definitions of what we mean.
"Wealth" - or is it "Money Supply" - or is it "Value Added" (or created)? They're all key components of a modern economy and are not mutually exclusive. They are inextricably intertwined in a system and if you alter one you affect the balance of the other components too. So you can't just argue one - you have to include them all.
It seems to me that Chris is closest to the nub of the matter. We each are working from different definitions of what we mean.
"Wealth" - or is it "Money Supply" - or is it "Value Added" (or created)? They're all key components of a modern economy and are not mutually exclusive. They are inextricably intertwined in a system and if you alter one you affect the balance of the other components too. So you can't just argue one - you have to include them all.
Leigh Youdale
Well-known
Unfortunately this theory doesn't really stand up to practical maths. Let's take another example I'm more familiar with but with the same conundrum.
India.
One billion people. Some few VERY wealthy, a growing middle class with aspirations of becoming more classy and less middle, and a mass of poverty stricken peasants destined to reproduce further generations of poverty stricken peasants.
The maths show very clearly that a redistribution of the aggregate wealth would result in EVERYONE being poor, none rich, and nobody with sufficient capital to start a business to grow and prosper or employ people and pay wages.
So it's really not a good answer at all, Chris, unfortunately.
Usually what happens is that people who have, or can get to manage capital, can create value-adding activities. The added value (which is often perceptual) when introduced into the supply chain creates additional "wealth" which is often distributed amongst several hands.
We could go on to explore the concept of the "value" of money, which raises the inflation bogey and questions of manipulation of money supply, but that's getting rather complicated.
As to "perceptual" value, consider a Leica M7 to my Bessa R4A. Both are boxes to hold film, attach a lens to and take photographs. People swap lenses between the two and much of RFF is taken up with nit-picking over details that in the end don't amount to a hill of beans. One might be "nicer" than the other to use, one might be a bit more solidly constructed if you're into dropping your camera regularly, but to all intents and purposes they do exactly the same job. But one person's perception is that the Leica is "worth" five or six times as much as the Voigtlander. That's not my perception even though I think it would be "nice" to own an M7.
Chriscrawfordphoto
Real Men Shoot Film.
India is a poor country. The USA isn't. Neither is Mexico. I a convinced that MY country, the USA, can eliminate poverty. Its an un-natural condition here and exists only because those in charge want it to. I think the same about Mexico. That country is not near as wealthy as the USA and the average Mexican would be poorer than the average US citizen, even if Mexico's economy was reformed, but there wouldn't be the grinding poverty that affects so many there that millions are willing to risk their lives to illegally come to the USA. Our leaders have gone after the illegal immigration problem from the wrong side. Mexico's government is the problem, not the individual Mexicans who come here for jobs. The government there encourage their people to leave so that Mexico's white rulers don't have to give up the power they've lorded over the Indian and Mestizo for 500 years. (10% of the population is white, Spanish, and they rule the brown skinned people like the colonial rulers of old).
Roger Hicks
Veteran
Let's try another line of argument.
Trying to argue from the point of view of the nation state is increasingly pointless. "The USA is like this..." "Mexico is like this..." "China is like this..."
Rich nations can afford to pay poor nations to make things for them. As long as there are enough rich people to buy the goods, they will be made by the poor.
As a result, (a) the poor get a bit richer, which is clearly a good thing, and (b) the poor also think, "Why is this rich bar steward able to afford things I can make, but can't buy?"
In this context, the "nation" is NOT a nation state. It is an economic nation, distributed across many countries, and there is a heavy cultural content: culturally I have more in common with most of my Tibetan exile friends than I do with many Americans.
Capitalism works. There's no doubt about that. But there are plenty of really stupid, lazy and morally bankrupt capitalists around, as well as the decent, hard working, intelligent ones. The same is true of any other political/ economic/ philosophical/ religious system: there are always more people who think they understand it (and therefore mindlessly exploit it for their own ends) than who actually understand it.
The job of a smart capitalist (or indeed a smart Marxist, Ecotopian, or anyone else) is to try to create a sustainable system that will not collapse as a result of lack of resources (the obvious limit to growth) or as a result of revolution, whether at the ballot box or at gunpoint.
Incidentally, Leicas aren't in the running here. Very few people deeply resent luxuries possessed by a few. They get a lot more upset when lots of others have things that really should be more fairly distributed in a rich world: clean water, food, and, yes, health care. They get even more upset when those people just don't care because they never think about the poor, or worse still say, "Well, if you haven't got it, it's your fault." That's when the rich (innocent as well as guilty) are lined up against the wall and shot.
Cheers,
R.
Trying to argue from the point of view of the nation state is increasingly pointless. "The USA is like this..." "Mexico is like this..." "China is like this..."
Rich nations can afford to pay poor nations to make things for them. As long as there are enough rich people to buy the goods, they will be made by the poor.
As a result, (a) the poor get a bit richer, which is clearly a good thing, and (b) the poor also think, "Why is this rich bar steward able to afford things I can make, but can't buy?"
In this context, the "nation" is NOT a nation state. It is an economic nation, distributed across many countries, and there is a heavy cultural content: culturally I have more in common with most of my Tibetan exile friends than I do with many Americans.
Capitalism works. There's no doubt about that. But there are plenty of really stupid, lazy and morally bankrupt capitalists around, as well as the decent, hard working, intelligent ones. The same is true of any other political/ economic/ philosophical/ religious system: there are always more people who think they understand it (and therefore mindlessly exploit it for their own ends) than who actually understand it.
The job of a smart capitalist (or indeed a smart Marxist, Ecotopian, or anyone else) is to try to create a sustainable system that will not collapse as a result of lack of resources (the obvious limit to growth) or as a result of revolution, whether at the ballot box or at gunpoint.
Incidentally, Leicas aren't in the running here. Very few people deeply resent luxuries possessed by a few. They get a lot more upset when lots of others have things that really should be more fairly distributed in a rich world: clean water, food, and, yes, health care. They get even more upset when those people just don't care because they never think about the poor, or worse still say, "Well, if you haven't got it, it's your fault." That's when the rich (innocent as well as guilty) are lined up against the wall and shot.
Cheers,
R.
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fergus
Well-known
I seem to recall in macroeconomics that saving was good for the individual, but bad for the entire population. There was a lot of algebra about 'aggregate demand' that proved this.
Hence if you save, you are richer than your neighbour who spends everything. But if everyone saves then the economy slows and we, as a whole, are worse off.
From this it stands to reason that there is, at any given time, a limit to the money supplied in a given economy. Over the long term, especially due to inflation, this amount may change, but it is necessarily finite in nature.
Hence, for one to be richer there is less overall for others to share.
Hence if you save, you are richer than your neighbour who spends everything. But if everyone saves then the economy slows and we, as a whole, are worse off.
From this it stands to reason that there is, at any given time, a limit to the money supplied in a given economy. Over the long term, especially due to inflation, this amount may change, but it is necessarily finite in nature.
Hence, for one to be richer there is less overall for others to share.
dfoo
Well-known
Your argument assumes that the money being saved is not put to work. Given that most people don't put their savings under their bed then the money is used. The exact use, of course, depends on the type of investment.
Spoks
Well-known
The world economy (the sum of GDP of all nations in the world) is growing with just a few % per year, depending with which currency you use to calculate it with. In, say, Norwegian Kroner, the world GDP growth is none at all. This because the value of the NOK has increased more than the growth of world GDP in the last few years. While measured in US$ the growth is somewhat larger.
Spoks
Well-known
Sorry, but I don't agree with you. The large growth of the Indian economy in the last 20 years is a result of a rather egalitarian educational system (health care system too!). Several hundred million Indians have a competitive high tech education. This resource can now be sold by internet. Still India is a grotesque example of unfair and unjust wealth distribution. Ironically, if they managed to distribute this wealth more evenly, India would become even stronger economically.
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