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Sorry, but that is a naive view. If you destroy the life savings of half the people that had the courage and interest to start a business, you’ve removed them f

Sorry, but that is a naive view. If you destroy the life savings of half the people that had the courage and interest to start a business, you’ve removed them from the game. You can’t start a business with no money. Do you really believe in this environment that millions of people will suddenly have the newfound urge to invest all of their (depleted) life savings in a small business? Many of the businesses that closed were profitable businesses in every sense. The government essentially outlawed most small businesses but left the business owners holding all the liabilities of their business. Few small business owners are wealthy enough to eat that kind of loss. Imagine if the government unilaterally destroyed your house but left you with the mortgage. What are the odds that you can buy another house at that point? Pretty slim I’d say.

marcus_holmes 7y ago
This assumes there's a choice. If there's no jobs to be had, then the choice is "sell stuff or starve". Not all small businesses need capital to start. And a lot that did start with capital didn't really need to (I've seen so many people rent an office as their first move, for a business they could easily run from home). To use your analogy: imagine if the government wrecked your house, but left you with the mortgage. You can't move anywhere, can't buy another place, can't rent anywhere. You'll have to rebuild from the rubble.
- heavenlyblue 7y ago
  So what you’re essentially saying is that it’s small businesses that should be paying for COVID-19?
  - SpicyLemonZest 7y ago
    Nobody should be paying for COVID-19, but everyone will be. I don't think there's any amount of financial magic or government support that can rescue small businesses from an indefinite loss of all their revenue.
- 101404 7y ago
  Sure, that would make an inspiring Hollywood movie. But in real world terms, it just sounds like a large number of Uber drivers.
- _curious_ 7y ago
  "You'll have to rebuild from the rubble." This terrifies people more than anything...and the more entitled someone is, the more they fear it.
engineeringwoke 7y ago
You are the one that is naive. I will translate. You want to keep kicking the can down the road, so that someone that isn't you will hold the bag. Because someone will hold the bag for all this, and it isn't fair. So? Life isn't fair. Pandemics happen, and the government can't possibly bail out everyone. He's right. Add a UBI and nationalize healthcare. It's not complicated; the elites just don't want it. The ones like you.
- kovacs 7y ago
  Perhaps you can translate for me too, because I read the reply and agreed that the risk appetite for new small business owners might not be as robust given the current set of rules, which is what the commenter was saying. At least that's my interpretation. You seem to see something else in this comment. As a result I have some clarification questions... How do they want to "keep kicking the can down the road" exactly? Your comment about the government not being able to bail out everyone only serves to reinforce the point about the risk of starting a small business. What do you mean by "He's right"? He's right that people will line up to start new businesses and put their diminished life savings on the line after what's transpired? Then you flippantly say "Add UBI and nationalized healthcare", as if it's just something you add to a shopping cart and "it's not complicated". So it sounds like you assume these features as part of the assumption that people will flock to starting businesses. That's not part of the discussion at all, but it's an interesting point to discuss whether that would spur the activity. It very well might as it's the "social safety net" one would need to have more confidence. About the only thing you said that resonated with me is "the elites just don't want it". Given the growing wealth disparity and the relative flat to down real income of the average American in the last 40 years I'd say that's a fair statement. Your final statement comes out of nowhere as you lump the commenter into this group of elites when all they were saying is "hey man, I'm not so sure people will be lining up to risk their life savings to start a small business". Care to try again with a gentler, more constructive tone and explain how the commenter, and by extension myself, are naive with the summarized viewpoint I stated at the outset?
  - engineeringwoke 7y ago
    It's not an opinion. I'm an engineer who also trained as an economist, and I know the answers to these questions. It's just math. It's all about the money supply. The elite want to bail out because it inflates the money supply. You can bail in instead of bail out. Bankruptcies happen and equity holders lose, but the problem is that bankruptices reduce the money supply. Money effectively disappears when debt is restructured. The problem we now face is that equity holders today have decided that bail outs are necessary politically. Equity is the most speculative ownership of productive capacity, but you wouldn't guess it with the way it's discussed. Wouldn't you expect that that kind of security to lose value in an unforeseen circumstance like this? The system eventually doesn't function if the government hamfistedly tries to alter price discovery to such an extent that markets stop working. That's where we are today. So bail in. Give everyone free money. I give you an ID number and a bank account number, and I receive cash every month. That's a hell of lot simpler. Nationalize healthcare. Wouldn't a nationalized system be simpler? The lines of code per person have to be higher in a country with fifty different systems. It will cause inflation, but we don't really have a choice. Sorry if my tone is a bit flippant, but someone has to argue for sanity here. The United States is going down a dark path in nationalizing so many USD assets. Somebody has to try to explain why.
_curious_ 7y ago
"You can’t start a business with no money." Yes it costs maybe a couple hundred dollars to legally start a business. So you are correct in the most literal sense, that it does take some $ to start! But if you have a mindset that it takes anything more than that, I'm here to tell you from firsthand experience that you're wrong :/
fragmede 7y ago
The odds of being able to buy another house are far higher if I had the money to pay off the first mortgage. The government literally and figuratively prints money. In trying to avoid as deep a global recession as we are headed into, it seems the government could use this ability in some fashion to help those who's houses have been destroyed, to buy another house.

marcus_holmes 7y ago

This assumes there's a choice. If there's no jobs to be had, then the choice is "sell stuff or starve". Not all small businesses need capital to start. And a lot that did start with capital didn't really need to (I've seen so many people rent an office as their first move, for a business they could easily run from home). To use your analogy: imagine if the government wrecked your house, but left you with the mortgage. You can't move anywhere, can't buy another place, can't rent anywhere. You'll have to rebuild from the rubble.

heavenlyblue 7y ago
So what you’re essentially saying is that it’s small businesses that should be paying for COVID-19?
- SpicyLemonZest 7y ago
  Nobody should be paying for COVID-19, but everyone will be. I don't think there's any amount of financial magic or government support that can rescue small businesses from an indefinite loss of all their revenue.
101404 7y ago
Sure, that would make an inspiring Hollywood movie. But in real world terms, it just sounds like a large number of Uber drivers.
_curious_ 7y ago
"You'll have to rebuild from the rubble." This terrifies people more than anything...and the more entitled someone is, the more they fear it.

engineeringwoke 7y ago

You are the one that is naive. I will translate. You want to keep kicking the can down the road, so that someone that isn't you will hold the bag. Because someone will hold the bag for all this, and it isn't fair. So? Life isn't fair. Pandemics happen, and the government can't possibly bail out everyone. He's right. Add a UBI and nationalize healthcare. It's not complicated; the elites just don't want it. The ones like you.

kovacs 7y ago
Perhaps you can translate for me too, because I read the reply and agreed that the risk appetite for new small business owners might not be as robust given the current set of rules, which is what the commenter was saying. At least that's my interpretation. You seem to see something else in this comment. As a result I have some clarification questions... How do they want to "keep kicking the can down the road" exactly? Your comment about the government not being able to bail out everyone only serves to reinforce the point about the risk of starting a small business. What do you mean by "He's right"? He's right that people will line up to start new businesses and put their diminished life savings on the line after what's transpired? Then you flippantly say "Add UBI and nationalized healthcare", as if it's just something you add to a shopping cart and "it's not complicated". So it sounds like you assume these features as part of the assumption that people will flock to starting businesses. That's not part of the discussion at all, but it's an interesting point to discuss whether that would spur the activity. It very well might as it's the "social safety net" one would need to have more confidence. About the only thing you said that resonated with me is "the elites just don't want it". Given the growing wealth disparity and the relative flat to down real income of the average American in the last 40 years I'd say that's a fair statement. Your final statement comes out of nowhere as you lump the commenter into this group of elites when all they were saying is "hey man, I'm not so sure people will be lining up to risk their life savings to start a small business". Care to try again with a gentler, more constructive tone and explain how the commenter, and by extension myself, are naive with the summarized viewpoint I stated at the outset?
- engineeringwoke 7y ago
  It's not an opinion. I'm an engineer who also trained as an economist, and I know the answers to these questions. It's just math. It's all about the money supply. The elite want to bail out because it inflates the money supply. You can bail in instead of bail out. Bankruptcies happen and equity holders lose, but the problem is that bankruptices reduce the money supply. Money effectively disappears when debt is restructured. The problem we now face is that equity holders today have decided that bail outs are necessary politically. Equity is the most speculative ownership of productive capacity, but you wouldn't guess it with the way it's discussed. Wouldn't you expect that that kind of security to lose value in an unforeseen circumstance like this? The system eventually doesn't function if the government hamfistedly tries to alter price discovery to such an extent that markets stop working. That's where we are today. So bail in. Give everyone free money. I give you an ID number and a bank account number, and I receive cash every month. That's a hell of lot simpler. Nationalize healthcare. Wouldn't a nationalized system be simpler? The lines of code per person have to be higher in a country with fifty different systems. It will cause inflation, but we don't really have a choice. Sorry if my tone is a bit flippant, but someone has to argue for sanity here. The United States is going down a dark path in nationalizing so many USD assets. Somebody has to try to explain why.

_curious_ 7y ago

"You can’t start a business with no money." Yes it costs maybe a couple hundred dollars to legally start a business. So you are correct in the most literal sense, that it does take some $ to start! But if you have a mindset that it takes anything more than that, I'm here to tell you from firsthand experience that you're wrong :/

fragmede 7y ago

The odds of being able to buy another house are far higher if I had the money to pay off the first mortgage. The government literally and figuratively prints money. In trying to avoid as deep a global recession as we are headed into, it seems the government could use this ability in some fashion to help those who's houses have been destroyed, to buy another house.