The weird step in the example isn't eating a turd for $20000. It's paying 20000 to see someone eat a turd. That the thought experiment is badly constructed is

The weird step in the example isn't eating a turd for $20000. It's paying 20000 to see someone eat a turd. That the thought experiment is badly constructed is clear once you take the money and indirection out of the picture. Does two - clearly somewhat weird - people agreeing to eat a turd if the other person eats a turd, somehow disprove economics? Clearly for each of the two people it's the case that they get more from watching the other person eat a turd than it costs them to eat one. Maybe they're perverts. Whatever. Value was actually clearly produced.