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Full Employment

locusmag.com

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Re: Full Employment

#51

Post by CraigJPerry »

musicale wrote: post #36
burlesona wrote: post #9

This is a great essay, but it doesn’t give me much hope for the US. Our behavior during this pandemic has been for one part of the country to finger wag and disbelieve while the other part suffers, while doing very little to actually fight the disease. It feels like we are so incapable of responding to this crisis that we are simply retreating into fantasy and pretending it’s not a big deal. This is all with a fast m…

> while doing very little to actually fight the disease Are you saying that there isn't much in the way of medical research going on to try to come up with treatments, preventive measures, and potential vaccines or cures for the disease? What do you think could be done to start that kind of research in the US?

350 million people. How many are pursuing medical research in any of its myriad forms? How many are posting 5g conspiracies, refusing to wear a mask or claiming that people dying years early on average isn’t a big deal?

The second cohort is a multiple in size of the first.

Re: Full Employment

#52

Post by Reelin »

zumachase wrote: post #44
Unsimplified wrote: post #38

Earlier quoted context omitted.

Incorrect. The use of discarded product by non-market flows has no effect on market price.

You’re putting the cart before the horse: price came first, then the product was discarded. The risk that these potatoes might be dumped into the market pushed prices down. If you magically take this risk away, it doesn’t matter by which mechanism, that threat goes away and price responds. If I’m another potato farmer and all of a sudden all those extra potatoes are teleported somewhere else, I will in all likelihood…

> If I’m another potato farmer and all of a sudden all those extra potatoes are teleported somewhere else, I will in all likelihood raise my prices.

There seem to be two different scenarios being conflated here.

You describe producers acting in response to the risk of future price changes.

It seems to me that others in the thread are describing a scenario where product is discarded because the price has already fallen so far that it is no longer profitable after accounting for various processing costs (ie things such as packaging and transportation).

In the latter scenario, if someone were to foot the bill for the redistribution itself there should be no direct effect on that specific part of the market. This assumes of course that the producers aren't compensated for the redistributed good (so it isn't significantly different than simply disposing of it). It also assumes that people don't resell or otherwise barter the product they receive (it's food and they're presumably starving so that assumption seems fairly reasonable in this case). (And of course there are bound to be countless indirect effects on the market as a whole.)

Re: Full Employment

#53

Post by zumachase »

ianleeclark wrote: post #47
zumachase wrote: post #44

Earlier quoted context omitted.

You’re putting the cart before the horse: price came first, then the product was discarded. The risk that these potatoes might be dumped into the market pushed prices down. If you magically take this risk away, it doesn’t matter by which mechanism, that threat goes away and price responds. If I’m another potato farmer and all of a sudden all those extra potatoes are teleported somewhere else, I will in all likelihood…

> It’s basic aggregate supply and demand. Okay, so then we have absolutely no idea in which way the demand curve will curve then. If the demand curve can be any polynomial, then we have no clue if this will happen or not.

What? Nothing I said has anything to do with the demand curve. This is all supply side. We hold the demand curve constant for any such analysis.

But it’s irrelevant anyway: a basic tenet of economics is that people are, in aggregate, utility maximizers. So yes, we do have an idea of some fundamental properties of the demand curve and it cannot simply be any polynomial.

Re: Full Employment

#54

Post by 082349872349872 »

js8 wrote: post #28

It's always refreshing to read someone who really gets that economy is not about money, but rather about what is being produced. The title reminded me of the famous Kalecki essay, Political Aspects of Full Employment, which actually explains deeper why this is not so easy to do as Cory Doctorow imagines (if you hadn't read it, I really recommend it, it's one of the best works on economics ever). Here I think is the c…

The only way your breakdown differs from The Theory and Practice of Oligarchical Collectivism is that the "clueless middle class" in Oceania seems to split into two mutually antagonistic but still self policing Outer Parties.

(also I think calling "white collar" "middle class" is a bit ahistorical: https://news.ycombinator.com/item?id=23671937 but, as with "hacker", I guess I should make an attempt to go with the times, if reluctantly)

Cleese: I get a feeling of superiority over them↓.

Barker: I get a feeling of inferiority from him↑, but a feeling of superiority over him↓.

Corbett: I get a pain↑ in the back of my neck.

Re: Full Employment

#55

Post by js8 »

zumachase wrote: post #46
js8 wrote: post #39

Earlier quoted context omitted.

> I had to stop reading after this. This is not how inflation works and it borders on the preposterous to surmise that CBs can monetize deficits without creating inflation because there is excess supply in one market. I think the government doesn't have to run deficits, it can always tax the money back out of the economy. (The only problem is nobody likes that, for some reason. People seem to prefer inflation to taxa…

We’re not talking about the Treasury. We’re talking about Central Banks who lack the power to tax (directly at least). > People seem to prefer inflation to taxation. That’s because they’re not the same thing, not at all.

I think when Doctorow talks about the CB, he pretty much puts it under government at large. Which I think is fair, various attempts at making CB independent on the actual government are rather puny in my opinion.

Regarding inflation, you're right, there are other sources of inflation than just government printing money. Money are also created privately, and certain inflation is IMHO inevitable, because most goods and assets depreciate.

But I do think that the inflation, induced by government printing additional money, can be negated by taxation.

Re: Full Employment

#56

Post by ianleeclark »

zumachase wrote: post #53
ianleeclark wrote: post #47

Earlier quoted context omitted.

> It’s basic aggregate supply and demand. Okay, so then we have absolutely no idea in which way the demand curve will curve then. If the demand curve can be any polynomial, then we have no clue if this will happen or not.

What? Nothing I said has anything to do with the demand curve. This is all supply side. We hold the demand curve constant for any such analysis. But it’s irrelevant anyway: a basic tenet of economics is that people are, in aggregate, utility maximizers. So yes, we do have an idea of some fundamental properties of the demand curve and it cannot simply be any polynomial.

> We hold the demand curve constant for any such analysis.

And this is the portion that I'm critiquing. You're holding it as a constant curve sloping downwards.

> So yes, we do have an idea of some fundamental properties of the demand curve

Okay, sure, it relies on there being people who have demand for some commodity.

> it cannot simply be any polynomial

"Any polynomial" might be overselling it, but we can't assume it's sloping downwards.

Re: Full Employment

#57

Post by Reelin »

js8 wrote: post #28

It's always refreshing to read someone who really gets that economy is not about money, but rather about what is being produced. The title reminded me of the famous Kalecki essay, Political Aspects of Full Employment, which actually explains deeper why this is not so easy to do as Cory Doctorow imagines (if you hadn't read it, I really recommend it, it's one of the best works on economics ever). Here I think is the c…

> If we truly payed blue collar guys a market rate, no white collar jobs would exist, because what is the price for risking your health?

Isn't that exactly what we do though? Doesn't pay (very approximately) correlate with required skill? For example, compare the salary of a skilled carpenter with some of the lower skilled "tech" jobs. All of your examples (manager, scum master, programmer) are decidedly high skill jobs when compared to the economy as a whole.

(As far as software goes, consider that demand for laborers currently outstrips supply. Prices adjust to reflect that.)

What you're really describing (IMO) is that everyone is competing with each other and we all want to be above average. Going back to your tech industry examples, I've heard it said that the majority of programmers think they're above average.

Re: Full Employment

#58

Post by eru »

js8 wrote: post #35
eru wrote: post #2

Compare https://en.wikipedia.org/wiki/Economic_impacts_of_climate_ch... Wikipedia quotes studies that put the estimated aggregate impact at losing about 0% to 20% of world GDP. That's comparable eg to moving from NYC to a place with average US GDP per capita. That's certainly a lot, but perhaps not a world shattering impact. (Edit: the studies quoted on that Wikipedia page are quite old by now. It would be useful to…

> Wikipedia quotes studies that put the estimated aggregate impact at losing about 0% to 20% of world GDP. That's comparable eg to moving from NYC to a place with average US GDP per capita. That's basically Nordhaus' idiotic argument. Agriculture is only about 3% of GDP, so it looks like we can take that hit, no problem. Except - if we have no food, there is no civilization. See https://braveneweurope.com/steven-keen…

In a sense, it's great that agriculture is only 3% of GDP. A disaster that would make agriculture much harder globally, would mean that agriculture would become a much _larger_ share of GDP, say 50%. And we would be worse off for it.

However, the studies quoted in the Wikipedia article take such considerations into account.

Measuring climate change impact by GDP is a good idea. It's not the only way to measure it, just one out of a number of useful ways.

For example, it is a useful way to figure out how much of our economic wealth we should be spending on fighting climate change:

US GDP seems to be about 60k USD per capita, or about 20 trillion USD total. Spending up to about 10% of that, or 2 trillion USD per year, on reliably fighting climate change might be worth while by that metric.

It also helps us to put into perspective the cost of programmes like the one talked about in https://news.ycombinator.com/item?id=23770718 and make it comparable to energy efficiency campaigns or carbon sequestration, etc.

Re: Full Employment

#59

Post by zumachase »

Reelin wrote: post #52
zumachase wrote: post #44

Earlier quoted context omitted.

You’re putting the cart before the horse: price came first, then the product was discarded. The risk that these potatoes might be dumped into the market pushed prices down. If you magically take this risk away, it doesn’t matter by which mechanism, that threat goes away and price responds. If I’m another potato farmer and all of a sudden all those extra potatoes are teleported somewhere else, I will in all likelihood…

> If I’m another potato farmer and all of a sudden all those extra potatoes are teleported somewhere else, I will in all likelihood raise my prices. There seem to be two different scenarios being conflated here. You describe producers acting in response to the risk of future price changes. It seems to me that others in the thread are describing a scenario where product is discarded because the price has already falle…

> It seems to me that others in the thread are describing a scenario where product is discarded because the price has already fallen so far that it is no longer profitable after accounting for various processing costs (ie things such as packaging and transportation).

I understand what people are saying. Unfortunately this just isn’t how things work. If there were a way for this to occur, prices would respond. Ultimately markets aggregate information and package it up in a single metric we call price. If all of a sudden there was a new future demand for some good, no matter how you frame it, prices will respond.

Re: Full Employment

#60

Post by eru »

082349872349872 wrote: post #50
eru wrote: post #13

Earlier quoted context omitted.

> 4) The USA is run by oligarchs who have a policy of discarding workers, so that completely undermines the article - the unemployed will not be working on moving cities inland, they will just be forgotten and destitute. What's your evidence for that? Unemployment was really quite low in the last decade up until a few months ago, with presumably the same 'oligarchs' already in power?

What's really quite low? Ours hit 3,4% in May due to the virus, but June just came out at 3,2%...

Which place are you talking about?

https://www.bls.gov/news.release/pdf/empsit.pdf says that US unemployment rate for June 2020 was 11.1%.

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