Post-Scarcity Economics • Hacker News Board

Re: Post-Scarcity Economics

#21

Post by ahomescu1 » Mon, Jul 15, 2013, 8:59 AM UTC

zanny wrote: post #6

will_asouka wrote: post #2

Can anyone with more economic insight than myself comment on how increased automation leading to higher unemployment (ie, self-driving car) might change the recommendations? Are we back to the Basic Income? Seems to be an increasingly relevant proposal.

I'm a software dude, not an economist, but as a guy on the Internet who reads reddit and hacker news, I feel 15% qualified to answer this question! I want to quote some passages from the article, which is kind of long, and I think misses some of the point. All personal internet nerd opinion. > Unemployment would drive wages down until, at some certain level, workers would be so cheap to hire that once again, men woul…

Another nitpick:

> Inheritance caused it (in the way Bill Gates became the wealthiest man in the world by virtue of his parents already being wealthy, that combined with a brilliant intellect and probably well instructed business sense available only to the already prosperous was able to create Microsoft - so if you are born genius with rich parents, you have a much better shot at becoming the richest man in the world, though I won't argue there aren't outliers).

Keep in mind that Linus Torvalds became a multi-millionaire due to Linux [1].

[1] http://www.linfo.org/linus.html

Personally, I think the man should also get a pile of Google&Samsung stock, that would make him even richer.

Re: Post-Scarcity Economics

#22

Post by 33a » Mon, Jul 15, 2013, 1:32 PM UTC

Good luck getting any of that done in America with the current house of representatives. It is currently politically impossible to get anything done at all in Washington. Our current congress can't even vote on simple stuff like raising the debt ceiling.

Re: Post-Scarcity Economics

#23

Post by thaumaturgy » Mon, Jul 15, 2013, 2:05 PM UTC

zanny wrote: post #13

nbouscal wrote: post #8

Earlier quoted context omitted.

> Tax policy has a huge impact on expanding a business. No, absolutely not. As someone who has run a small business, there is exactly one thing that made me hire a new employee: too much work (aka demand). That's it, period, absolutely nothing else. Taxes did not have a single thing to do with it. Barring tax policies far removed from everyday reality in the U.S., hiring a new employee to meet demand will always be m…

The new hire puts you up a tax bracket, and you lose profit to gain productivity. Your immediate finances can't support adopting a new hire or division because tax proceeds from your profit margin limit your growth potential. If you can immediately make a return on a new hire, with instant productivity gains and immediate bottom line improvements, yes, you absolutely make the hire. But that doesn't always happen, and…

I'm also a small business owner -- have been for several years now. I also have a number of business clients, and I'm active in my local business community. On this point, you're wrong.

Taxes are not my biggest concern, demand is. Same for my clients, down to the last one.

> The new hire puts you up a tax bracket, and you lose profit to gain productivity.

Not if you're sensible about how you price your product or services. Hiring should increase your profit, not decrease it; when you see businesses making cost-cutting layoffs, you're seeing adjustment caused by either a decrease in demand (sales & revenue) or by mismanagement ("fiefdom hiring").

> Your immediate finances can't support adopting a new hire...

If the phone started ringing off the hook right now I could afford a new hire within a week or two.

> ...because tax proceeds from your profit margin limit your growth potential.

Taxes aren't due until the next quarter. I suppose they "limit my growth potential", but so does every other business expense, including payroll. Hell, if I didn't have to pay anybody, I would have infinite growth potential!

> You need financial capital to invest in broadening or transitioning your business rather than just increasing labor to meet more demand

I think you are conflating a couple of different things here.

Taxes don't have a practical effect on capital for a successful business. Lenders and investors are happy to work with businesses that can provide ROI. Increasing labor to meet demand is something you do in parallel with other growth strategies, but for small businesses, they can often do just fine hiring an extra employee or two to meet demand without having to organize enterprisey growth strategies.

> principally because in this modern age it is easier to automate increased demand (circumstantially, but frequently) than to hire more workers to cover it.

what?

This is contrary to what I hear from every single one of my clients. Every one. I can see it being true in certain, specific cases -- certain industries, certain types of business maybe -- but as a generalization of all businesses in America, it is wrong.

I think you need to go and talk to a couple of local restaurant managers and feed them these lines. See what they think.

> IE, if your market grows 10%, you might as well invest in a contracted software team to automate your systems to enable your current labor staff to be 10% more productive than to hire 10% more people.

And spend more money on the contractors than you would on an equivalent number of employees, have a questionable long term support plan and/or ownership of the software, spend money on staff training, and, best of all, wait a minimum of six months to a year straining under the weight of increased demand (and pissing off all of your existing and new customers in the meantime) while the software gets built and then debugged and documented.

Put your theories to the test: run a business.