After the check is gone: The underground economy of rural America • Hacker News Board

Re: After the check is gone: The underground economy of rural America

#21

Post by hpcjoe » Fri, Oct 06, 2017, 3:58 PM UTC

ianai wrote: post #15

hpcjoe wrote: post #10

Earlier quoted context omitted.

The concern I have with this will be inflation. People now have money, sellers can now raise prices. Which eventually gets us right back to where we were. You can give them more money, but then you are accelerating the cycle.

Not quite. Inflation isn’t the outright awful thing people assume it is. Further, the concept is to give people just enough to survive. That creates demand for only the basics. The basics are largely standardized items. When was the last time there was a shortage in corn, cotton, flour? They’re all commodities. If anything modern prices for these goods and services are likely to be indifferent to the increase in dema…

Its not awful over a short term. Over a longer term, it will price commodities out of reach. I've watched milk prices rise dramatically over the last 5 years or so. This is in part due to the costs of production rising, not necessarily the farm margins. These costs of production rise for any number of reasons, but mostly its because rising costs tend to spread out through the economy. [1]

My point is that prices will rise and find their time dependent values, in a way that will diminish the purchasing power of those you'd be attempting to help. You give enough so they have some left over, and enterprising groups will realize that they can raise prices to reflect the larger purchasing power.

Economics 101 in this case.

[1] http://www.investopedia.com/financial-edge/0212/inflation-an...

Re: After the check is gone: The underground economy of rural America

#22

Post by ianai » Fri, Oct 06, 2017, 4:00 PM UTC

hpcjoe wrote: post #17

ams6110 wrote: post #9

Earlier quoted context omitted.

> what do you do when the fish are just gone? Move to where the fish are. The economy isn't terrible everywhere.

Assume, as the story implies, that they haven't the money to move. Moving costs money. Exactly what should they do? Channeling Marie Antoinette is obviously not the right answer (e.g. moving to the jobs) as they are functionally immobile, and as the article notes, they are disabled. Note: the above question is somewhat rhetorical. There is no real answer, or rather no easy answer. Basic income may help, or it may del…

Also the economy is pretty terrible in most places. That if anything should be the biggest backing for a UBI.

Re: After the check is gone: The underground economy of rural America

#23

Post by hpcjoe » Fri, Oct 06, 2017, 4:00 PM UTC

lg wrote: post #13

hpcjoe wrote: post #10

Earlier quoted context omitted.

The concern I have with this will be inflation. People now have money, sellers can now raise prices. Which eventually gets us right back to where we were. You can give them more money, but then you are accelerating the cycle.

sellers who raise prices will need to compete with ones who don't.

And ... how well is that working out in markets like, say, high speed internet (from someone who is struggling to find competitive offerings in a large market near major cities).

The point is that sellers may attempt to partition markets to reduce competitive pressure, allowing each to increase their pricing without worrying about being undercut.

Re: After the check is gone: The underground economy of rural America

#24

Post by forkandwait » Fri, Oct 06, 2017, 4:00 PM UTC

So why can't we invest enough time and money in these people to make them engineers and technicians? Then they might be able to start shops that make and distribute the tourist trinkets mentioned by another poster. Why is the only solution that a large company that someone else creates moves in and provides low skill jobs?

Re: After the check is gone: The underground economy of rural America

#25

Post by javajosh » Fri, Oct 06, 2017, 4:00 PM UTC

hpcjoe wrote: post #8

logfromblammo wrote: post #2

That is so depressing. No wonder suicide rates are up. You know there's a difference between "give a man a fish" and "teach a man to fish", but what do you do when the fish are just gone ? It was mentioned in the article, but not extensively discussed. I think maybe the largest distinct segment of the economy in ex-coalcountry regions is now pharmaceuticals, legal and illegal. There's the legal root and mushroom hunt…

This is replicated all over the rust belt. One of the saddest portrayals of this is the photo essay, The Ruins of Detroit[1]. These once mighty economic engines have been silenced: manufacturing, coal, etc. What happens next is that the people who depend upon these industries to make a living, and live ... do less well of a job of this. Some argue that unions would help (they wouldn't), or anti-globalism would stop f…

The good capitalist would say that if a firm moves out of a region, that another firm will happily pounce on all of those experienced, employable workers they left behind! Hiring is hard, so having a big pool of applicants is great!

What the good capitalist ignores is the extent to which workers become specialized at the firm, become a cog not shaped correctly for any other firm. Call this lack of fungibility. (It's one reason why company loyalty used to a) be a popular feature, and b) work both ways.)

The good capitalist also ignores the fact that the conditions that drove the firm away in the first place will generally drive away other firms, too. Company analysts think in herds. Consider the enormous cost to give up an employed work-force, since acquisition and maintenance cost for a large work-force is high. Why wouldn't a second firm, faced with the same inputs as the first, make the same decision as the first?

Re: After the check is gone: The underground economy of rural America

#26

Post by ThrustVectoring » Fri, Oct 06, 2017, 4:01 PM UTC

ianai wrote: post #15

hpcjoe wrote: post #10

Earlier quoted context omitted.

The concern I have with this will be inflation. People now have money, sellers can now raise prices. Which eventually gets us right back to where we were. You can give them more money, but then you are accelerating the cycle.

Not quite. Inflation isn’t the outright awful thing people assume it is. Further, the concept is to give people just enough to survive. That creates demand for only the basics. The basics are largely standardized items. When was the last time there was a shortage in corn, cotton, flour? They’re all commodities. If anything modern prices for these goods and services are likely to be indifferent to the increase in dema…

"Just enough to survive" gets purchased anyways - there wouldn't be a huge increase in demand for corn, cotton, and flour.

Re: After the check is gone: The underground economy of rural America

#27

Post by gph » Fri, Oct 06, 2017, 4:05 PM UTC

forkandwait wrote: post #24

So why can't we invest enough time and money in these people to make them engineers and technicians? Then they might be able to start shops that make and distribute the tourist trinkets mentioned by another poster. Why is the only solution that a large company that someone else creates moves in and provides low skill jobs?

What makes you think these people wouldn't already have jobs as engineers and technicians if they were capable of that? It even mentions in the article that the one lady lives down the road from her nephew who has a nice house with trucks and a boat. He was pulling down 100k at a coal related job, that might mean in a labor role but there's a good chance he's the type of person you're talking about; someone capable of filling a sort of lower-level engineer/technician role.

Edit: That's not to say there aren't a few capable folks that fell on rough times or came from a rough background and never quite got a good enough opportunity to make something of themselves. Certainly it would be nice to have programs to help those folks reach the full extent of their capabilities. But that's definitely not a solution for the broad majority of people in this situation.

Re: After the check is gone: The underground economy of rural America

#28

Post by smt88 » Fri, Oct 06, 2017, 4:05 PM UTC

forkandwait wrote: post #24

So why can't we invest enough time and money in these people to make them engineers and technicians? Then they might be able to start shops that make and distribute the tourist trinkets mentioned by another poster. Why is the only solution that a large company that someone else creates moves in and provides low skill jobs?

You should look into our extensive federal retraining programs, which have this goal.

Oftentimes, the problem is age. Older people just finishing training still won't get a job.

Other times, the problem is that they refuse to relocate to another part of the country to get the job they trained for.

It sounds great in theory, but it requires a lot of flexibility that not everyone can have.

Re: After the check is gone: The underground economy of rural America

#29

Post by wu-ikkyu » Fri, Oct 06, 2017, 4:09 PM UTC

hpcjoe wrote: post #10

tdb7893 wrote: post #7

Earlier quoted context omitted.

One good thing about a true basic income is that there wouldn't be conditions for receiving it so it would significantly lessen the penalty for working legitimately (obviously there would still be tax reasons to have income you don't need to report). My hope for basic income is that by simplifying how we give aid it can take out much of the ridiculous bureaucracy of it but I'm obviously no expert

The concern I have with this will be inflation. People now have money, sellers can now raise prices. Which eventually gets us right back to where we were. You can give them more money, but then you are accelerating the cycle.

What about a resource-based basic income? There is already a vast surplus of food and shelter that goes wasted every year, at least in the US.

Re: After the check is gone: The underground economy of rural America

#30

Post by convolvatron » Fri, Oct 06, 2017, 4:10 PM UTC

forkandwait wrote: post #24

So why can't we invest enough time and money in these people to make them engineers and technicians? Then they might be able to start shops that make and distribute the tourist trinkets mentioned by another poster. Why is the only solution that a large company that someone else creates moves in and provides low skill jobs?

the trinket economy is a race the bottom. if you get a high enough profile or successful design suddenly shipping containers start arriving filled with nearly exact copies for 1/50th of what you were charging.

and what you were charging was almost $5/hr for your labor. maybe more if you can invest in capitol equipment like a water jet.

skilled technical labor (machinist, welder, cabinetry, jewelry, etc) isn't much of a growth industry either. but people are still hiring if you already have experience

smt rework is a thing, but that seems like its inherently limited in volume.

i think its pretty tough for someone in a garage to make it work..if anyone has any ideas though..