Economics Questions

Re: Luddite on Reddit - please comment!

Malachi — Mon, 05 Mar 2012 04:49:31 GMT

Says the guy who isnt sure if he owns his own body. Come back when you figure out that inside =/= outside.

Re: Luddite on Reddit - please comment!

Fool on the Hill — Mon, 05 Mar 2012 04:33:18 GMT

You're just talking nonsense now.

Re: Luddite on Reddit - please comment!

Malachi — Sun, 04 Mar 2012 19:54:14 GMT

The new work is not necessarily more valuable to him.

some people like clouds better than clear skies. Whats your point?

True, the worker is a consumer, but not necessarily a consumer of the lower-price goods.

then why did he love that job so much? Was he exploiting consumers by charging inordinately high prices from the production of scarce goods? Now asthma patients across the country have inhalers and this guy is mad because he has to get a real job. So what?

Plus, being unemployed outweighs the advantages of having lower-priced goods

no it doesnt. If the lower priced goods enable the person to subsist off of his savings he can retire. You are making unwarranted assumptions to support your blanket statements. You are not entitled to other people's labor, you have to provide something of value in return.

Sure, the demand for labor in the steel industry might increase as a result of the increase in flights. But does that mean the baggage worker instantly has a job at a steel mill upon being laid off?

I am not quite sure what your reference to the inexorable passage of time is supposed to prove. He has to arrange to sell his labor to someone who wants it. This takes time and savings, just like it takes time and savings to build a baggage handling machine.

What if the worker lives in Atlanta but the steel is being produced in China?

well then he can get a job as a flight attendant and study pilotry, and when they automate flight attendants he can fly, and when they replace the pilots with a robot air travel will be so cheap he can fly to chicago and back for his shifts as a steel worker.

You've pretty much conceded my main points.

in other words, your main points are value judgments in that you equate being fired to being dumped in an LTR. It might help you to equate a relationship that one party is unable to terminate to a form of slavery.

Re: Luddite on Reddit - please comment!

Fool on the Hill — Sun, 04 Mar 2012 18:50:21 GMT

its ipso facto better for the worker because his labor can be put to a more valuable use and all consumers benefit from the lower-priced consumption goods and the worker is a consumer. If he wants to make boots by hand, then he can make boots by hand. Machines that make boots dont make it illegal to make boots without a machine. They just make everyone wealthier by decreasing the amount of labor input necessary to make boots.

The new work is not necessarily more valuable to him. True, the worker is a consumer, but not necessarily a consumer of the lower-price goods. Plus, being unemployed outweighs the advantages of having lower-priced goods

increasing number of flights just means an increase in demand for all inputs related to commercial air travel. Where are these extra man-hours going to come from? You suggest that pilots might work longer hours. More detailed analysis suggests that the demand for labor simply increases. They need more pilot man-hours, not longer shifts. With the addition of baggage handling machines, the supply of commercial air travel has increased. All else being equal, the price will decrease which means all consumers of air travel benefit. Additionally, the baggage handling machines require maintenance, and someone has to build them, someone has to create the steel, plastic, and electronics that they are made of, and someone has to extract the raw components for the steel, plastic and electronics from the earth.

there is no cosmic guarantee that "x" skill will remain relevant. If someone figures out a better way of doing something, so much the better. Less labor has to be spent on the required task therefore labor is available for other things. This is how technology progresses.

Sure, the demand for labor in the steel industry might increase as a result of the increase in flights. But does that mean the baggage worker instantly has a job at a steel mill upon being laid off? What if the worker lives in Atlanta but the steel is being produced in China?

You've pretty much conceded my main points.

I am saying that people start businesses in order to make profit by meeting the demands of customers in the most efficient way possible, so they can stand at the end of the capital chain and scoop up all the surplus as profit. There is no rule that says they will necessarily find other uses for those laborers, and frequently they will not. This is irrelevant because those laborers have the opportunity to move on to something productive instead of a job that a machine can do. Someone, either the original business owner or someone else can, use their labor as a production input in their capital chain.

.Then I don't really disagree.

Re: Luddite on Reddit - please comment!

Malachi — Sat, 03 Mar 2012 22:39:11 GMT

I don't think you can claim it is better for the worker ipso facto. The worker may enjoy his job and not want to move.

then perhaps he would not have a problem competing with the machine because he finds labor to have utility, rather than disutility, and so he opens a competing firm that doesnt use robots and undercuts his former employer.

its ipso facto better for the worker because his labor can be put to a more valuable use and all consumers benefit from the lower-priced consumption goods and the worker is a consumer. If he wants to make boots by hand, then he can make boots by hand. Machines that make boots dont make it illegal to make boots without a machine. They just make everyone wealthier by decreasing the amount of labor input necessary to make boots.

I don't think it matters that a particular industry (maybe I've been using the wrong words) employs both skilled and unskilled labor. It's the particular occupations and tasks that matter. Suppose machines are invented that eliminate the need for baggage handlers at an airport. The airport may wish to spend the money it saves from eliminating these baggage handlers on increasing the number of flights. To do this, the airport needs more pilots. But it cannot just transfer these baggage handlers to the cockpit. The solution might be to get the current pilots to work longer hours. Thus, the innovation doesn't guarantee that the baggage handlers will be better off.

increasing number of flights just means an increase in demand for all inputs related to commercial air travel. Where are these extra man-hours going to come from? You suggest that pilots might work longer hours. More detailed analysis suggests that the demand for labor simply increases. They need more pilot man-hours, not longer shifts. With the addition of baggage handling machines, the supply of commercial air travel has increased. All else being equal, the price will decrease which means all consumers of air travel benefit. Additionally, the baggage handling machines require maintenance, and someone has to build them, someone has to create the steel, plastic, and electronics that they are made of, and someone has to extract the raw components for the steel, plastic and electronics from the earth.

there is no cosmic guarantee that "x" skill will remain relevant. If someone figures out a better way of doing something, so much the better. Less labor has to be spent on the required task therefore labor is available for other things. This is how technology progresses.

I'm not really sure what you are saying here or how it contradicts what I'm saying.

I am saying that people start businesses in order to make profit by meeting the demands of customers in the most efficient way possible, so they can stand at the end of the capital chain and scoop up all the surplus as profit. There is no rule that says they will necessarily find other uses for those laborers, and frequently they will not. This is irrelevant because those laborers have the opportunity to move on to something productive instead of a job that a machine can do. Someone, either the original business owner or someone else can, use their labor as a production input in their capital chain.

Re: Luddite on Reddit - please comment!

Fool on the Hill — Sat, 03 Mar 2012 22:05:13 GMT

When the greedy capitalist buys a machine that means he can make four times the product with half the workforce, that is a win for everyone, including the workers whose labor is no longer necessary. They have the opportunity to find more fulfilling employment elsewhere. If they were performing manual labor that a machine can do better and faster, then it sounds like they were the alienated labor class of yore, you should be glad that they can be machine operators instead of riveters.

I don't think you can claim it is better for the worker ipso facto. The worker may enjoy his job and not want to move.

none of those are industrial processes. You seem to be backpedaling, because you chose to mention a bunch of skilled labor positions, none of which even produces any tangible goods (unless you consider a manuscript or operating system to be tangible) and you know what else? All of those industries (air flight, computer programming, medicine, education, accountancy, literature) make use of unskilled labor. Do I need to go down the list? Shoeshiner, baggage handler, flight attendant, beta tester, janitor, assembler, marketer, informant, student, receptionist, sales, delivery worker, material handler, indexer. There are literally thousands more but even an ultra-capitalist like myself cannot list every employment opportunity on the market off the top of his head.

I don't think it matters that a particular industry (maybe I've been using the wrong words) employs both skilled and unskilled labor. It's the particular occupations and tasks that matter. Suppose machines are invented that eliminate the need for baggage handlers at an airport. The airport may wish to spend the money it saves from eliminating these baggage handlers on increasing the number of flights. To do this, the airport needs more pilots. But it cannot just transfer these baggage handlers to the cockpit. The solution might be to get the current pilots to work longer hours. Thus, the innovation doesn't guarantee that the baggage handlers will be better off.

it doesnt make sense to you because you arent thinking like a business owner. The first step to solving your problem will be to parse the phrase "reduce the number of laborers necessary to run the business." this implies the pursuit of profit. Reducing the number of laborers required to meet a customer's demand means that an entrepreneur is 1) successful and 2) has capital available to meet the demands of more customers. Having demonstrated his ability to satisfy demand, he can now launch another product.

reducing the amount of labor inputs necessary to create a given product increases the supply of labor making it less expensive. Your analysis stops here and assumes that the market (and therefore the universe) descends to another, even crappier level of exploitation. Instead you should realize that the market is dynamic and there are potential purchasers of labor who are kept out of the market by prices that are slightly too high for them, and when the supply increases they can launch their business ventures.

I'm not really sure what you are saying here or how it contradicts what I'm saying.

Re: Luddite on Reddit - please comment!

Malachi — Sat, 03 Mar 2012 21:04:37 GMT

Actually, your point didn't really contradict mine. I was saying that capitalists do try to hire unskilled workers.

I think you got lost down this rabbit hole. Capitalists demand skilled and unskilled labor. The continual invention of ever more useful capital goods increases the demand for skilled and unskilled labor because there is more opportunity to produce. When the greedy capitalist buys a machine that means he can make four times the product with half the workforce, that is a win for everyone, including the workers whose labor is no longer necessary. They have the opportunity to find more fulfilling employment elsewhere. If they were performing manual labor that a machine can do better and faster, then it sounds like they were the alienated labor class of yore, you should be glad that they can be machine operators instead of riveters.

Airplane pilots, software engineers, medical practitioners, teachers, accountants, writers/editors, etc.

none of those are industrial processes. You seem to be backpedaling, because you chose to mention a bunch of skilled labor positions, none of which even produces any tangible goods (unless you consider a manuscript or operating system to be tangible) and you know what else? All of those industries (air flight, computer programming, medicine, education, accountancy, literature) make use of unskilled labor. Do I need to go down the list? Shoeshiner, baggage handler, flight attendant, beta tester, janitor, assembler, marketer, informant, student, receptionist, sales, delivery worker, material handler, indexer. There are literally thousands more but even an ultra-capitalist like myself cannot list every employment opportunity on the market off the top of his head.

This doesn't even make any sense. You mean machines don't actually reduce the number of laborers necessary to run the business?

it doesnt make sense to you because you arent thinking like a business owner. The first step to solving your problem will be to parse the phrase "reduce the number of laborers necessary to run the business." this implies the pursuit of profit. Reducing the number of laborers required to meet a customer's demand means that an entrepreneur is 1) successful and 2) has capital available to meet the demands of more customers. Having demonstrated his ability to satisfy demand, he can now launch another product.

reducing the amount of labor inputs necessary to create a given product increases the supply of labor making it less expensive. Your analysis stops here and assumes that the market (and therefore the universe) descends to another, even crappier level of exploitation. Instead you should realize that the market is dynamic and there are potential purchasers of labor who are kept out of the market by prices that are slightly too high for them, and when the supply increases they can launch their business ventures.

Re: Luddite on Reddit - please comment!

Malachi — Sat, 03 Mar 2012 20:28:11 GMT

Freedom4Me73986:

So its ok to violate the law of life a little bit....

No other species kills their competitors the way civilized man does. Your confusing the killing of competitors with the extent its done.

I am not confusing anything. You need to understand that whimsical half-baked arguments do more harm than good on this forum. If you are going to assert the law of life, you need to support it with some penalties for breaking it. If the law of life applies to all life, animals that violate it should suffer ill effects and you should be able to demonstrate that.

you dont seem to realize that we agree on this supposed "law of life" but its not rigorously defensible yet. Meaning its not ready for prime time, meaning we need something more than argument by assertion.

also, realize that you cant have capitalism without specialized division of labor and you cant have that without surplus calories, and you cannot generally get surplus calories through h/g. So you do some thinking this weekend and get back to me.

Re: Luddite on Reddit - please comment!

Fool on the Hill — Sat, 03 Mar 2012 18:23:54 GMT

Too true my friend. It his however always beneficial to increase production under circumstances in which one is not compelled to expand his production-process because of an artificial stimulation of credit, namely a situation in which the price signals accurately convey market conditions.

It's always beneficial to increase production when one isn't compelled to increase production? Interesting conclusion.

Re: Luddite on Reddit - please comment!

Freedom4Me73986 — Wed, 29 Feb 2012 06:38:37 GMT

So its ok to violate the law of life a little bit....

No other species kills their competitors the way civilized man does. Your confusing the killing of competitors with the extent its done.

Re: Luddite on Reddit - please comment!

Jargon — Wed, 29 Feb 2012 06:30:17 GMT

Fool on the Hill:

Well, they're jobs involved in industrial processes. Or are you saying that certain jobs aren't part of industry? Maybe I was using the wrong word. Wikipedia says that industry is "the production of an economic good or service within an economy."

Well, what Malachi was saying was, show him an industrial process that had not accomodated unskilled labor. You named skilled labor positions in an industrial process. Skilled labor in an industrial process does not preclude unskilled labor in said process.

Sure, the workers could be used to increase production. But it's not always beneficial to increase production.

Too true my friend. It his however always beneficial to increase production under circumstances in which one is not compelled to expand his production-process because of an artificial stimulation of credit, namely a situation in which the price signals accurately convey market conditions.

Re: Luddite on Reddit - please comment!

Fool on the Hill — Wed, 29 Feb 2012 06:04:56 GMT

Was not aware that these are industrial processes.

Well, they're jobs involved in industrial processes. Or are you saying that certain jobs aren't part of industry? Maybe I was using the wrong word. Wikipedia says that industry is "the production of an economic good or service within an economy."

The Capitalist does would not ever fire someone because he wanted to reduce labor. The Capitalist would fire someone to reduce costs. The Capitalist buys machinery because they improve his chain of production at a cost he deems acceptable. However, buying machinery for the task of ten men does not necessarily put ten men out of a job. There is still a demand for other services after their replacement: one of the common ones being the maintenance of said machine.

Sure, the workers could be used to increase production. But it's not always beneficial to increase production.

Additionally, this machine, freeing up labor and reducing the net cost of production to society, allows for further opportunities of employment in industries which have benefitted from cheaper items. Businesses buying products from the Capitalist will pay less for them after the Capitalist can cheapen the chain of production and thus have more savings to invest in their enterprise. The same applies to the Capitalist.

Take no economic incident in isolation from the gigantic chain of activity from which it is inextricable.

Right, as Marx pointed it out, this "freeing" of labor is only temporary.

Re: Luddite on Reddit - please comment!

Jargon — Wed, 29 Feb 2012 05:30:37 GMT

Fool on the Hill:

Airplane pilots, software engineers, medical practitioners, teachers, accountants, writers/editors, etc.

Was not aware that these are industrial processes.

This doesn't even make any sense. If machines don't actually replace workers for the capitalist, then why would he buy them?

The Capitalist does would not ever fire someone because he wanted to reduce labor. The Capitalist would fire someone to reduce costs. The Capitalist buys machinery because they improve his chain of production at a cost he deems acceptable. However, buying machinery for the task of ten men does not necessarily put ten men out of a job. There is still a demand for other services after their replacement: one of the common ones being the maintenance of said machine. Additionally, this machine, freeing up labor and reducing the net cost of production to society, allows for further opportunities of employment in industries which have benefitted from cheaper items. Businesses buying products from the Capitalist will pay less for them after the Capitalist can cheapen the chain of production and thus have more savings to invest in their enterprise. The same applies to the Capitalist.

Take no economic incident in isolation from the gigantic chain of activity from which it is inextricable.

Re: Luddite on Reddit - please comment!

Fool on the Hill — Wed, 29 Feb 2012 05:13:11 GMT

I want you to sit down and think until you realize that this is not a counterexample to my point.

Actually, your point didn't really contradict mine. I was saying that capitalists do try to hire unskilled workers.

please describe an industrial process that hasnt evolved to use unskilled labor

Airplane pilots, software engineers, medical practitioners, teachers, accountants, writers/editors, etc.

Here in the real world, they operate and maintain the robots because they havent invented anything close to robots that can replace human workers. But in marxist fantasy-land where calculation is unnecessary, the evil capitalists have better robots, apparently.

This doesn't even make any sense. You mean machines don't actually reduce the number of laborers necessary to run the business?

Re: Luddite on Reddit - please comment!

Malachi — Tue, 21 Feb 2012 15:43:36 GMT

So its ok to violate the law of life a little bit....