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This wouldn’t work at all, and in fact would do opposite to what you want. You are trying to solve the problem of scarcity. This scarcity manifests in people h

by xyzzyz 6y ago

This wouldn’t work at all, and in fact would do opposite to what you want. You are trying to solve the problem of scarcity. This scarcity manifests in people having not enough. And I’m not taking about your Enough, I’m talking about people having to think about how much mortgage they can afford, whether to buy groceries at Whole Foods, Safeway or Walmart, or whether they can make payment on their car. All of this happens because we don’t have unlimited abundance of everything, and we need to determine how products and services that are produced get distributed. For this purpose, we use money , and the way it works is people can make money by various activities that almost always provide products and services that other people value, and they give you money in exchange. This can be entrepreneurship, but for most people it’s a job one does for wages. Some jobs pay little, some pay a lot, and it seems that your idea is that there are not enough high paying jobs around, and so you want to increase availability of these jobs by having people working these jobs give them up early. This is a well meaning, but terrible idea. The problem here is that its result is less things get produced, so in aggregate, we’re even less wealthy than before your plan. Your plan is strictly negative for the society. It might benefit some people who get to have a better job than they otherwise would, but the society is paying immense cost for this job. A better alternative than destroys less (though still significant amount) value is to just tax the high earners and use the proceeds to subsidize low earners. This way, you can have low earners earn as much as they would have after switching to higher paying job in your “retire early when you have Enough”, but you’d have both high and low earner continue working, so more total value would be produced.

sunshinerag 6y ago
>> A better alternative than destroys less (though still significant amount) value is to just tax the high earners and use the proceeds to subsidize low earners. This way, you can have low earners earn as much as they would have after switching to higher paying job in your “retire early when you have Enough”, but you’d have both high and low earner continue working, so more total value would be produced. In this better alternative why would high earners continue to earn high when they can just switch to become a low earner and eat the tax from the remaining high earners.
- xyzzyz 6y ago
  Yes, they could do that, which is why income taxes also destroy value. They’re just not as bad as directly incentivizing people to stop working altogether.
  - javajosh 6y ago
    Most people will never get to their Enough number, so your point is moot. That is, even if by some miracle Enough caught on, and people did it, talked about it, and acted on it, not much would change except, at first, there would be a wave of retirements that, presumably, would open up positions for younger folks in the industry.
javajosh 6y ago
The reason you're wrong is that high earners are usually not actively producing things. The business leaders are making allocation decisions, which are removed from production by 2-5 levels of indirection. Or, another way to look at it. All the good advice about growing rich talk about "passive income". That is, by definition, income you make despite not doing anything. The economy suffers not at all if such a person decides to do...anything with that money (other than consume it).
- xyzzyz 6y ago
  > The reason you're wrong is that high earners are usually not actively producing things. I don’t know what background you are coming from, but rest assured that most high earners do produce significant value. Lawyers, doctors, software engineers, architects, the list could go on an on. To be sure, some people might make money in zero sum activities, and some might exploit information asymmetries to charge significantly more than their services would be worth in perfect information scenarios. But, by and large, high earners (defined as, say, top 5% of wage workers) most definitely do provide value, in excess of what they are actually paid. It is simply hard for millions of people to convince others to give them more money than they services are worth. > Or, another way to look at it. (...) I don’t actually understand your argument in this sections. Most good advice on getting rich is not focusing on “passive income”. Instead, it focuses on investment and on providing value by entrepreneurship. People talking about “passive income” usually mean by it a kind of investment that produces returns with little to no labor input required. Given the low cost of capital today, such investments don’t usually provide high returns, and so are highly unlikely to make one rich. They can provide nice income, to be sure, but that requires becoming rich in the first place.
  - javajosh 6y ago
    >Most good advice on getting rich is not focusing on “passive income”. I have to conclude you aren't arguing in good faith.
hakfoo 6y ago
A major gap is that while we can reason consciously as individuals about the values of goods and services, as an society/economy we price things unconsciously. There are many jobs that have well agreed upon social value but we have no way to wire up the economy to pay them commensurately. Think of caregivers being paid $9 per hour to clean up Grandpa's sick, or teachers who can't spend their summers on improving their craft because they have to take a menial off-season position to stay afloat. It also works on the other side-- I think you'd be hard pressed to find someone saying that top athletes and actors are worth eight figures a year on their contribution to society alone, but the market has bid them there. A much more hands-on system of wage and price controls could at least come from a conscious decision-making process.

by xyzzyz 6y ago

sunshinerag 6y ago

>> A better alternative than destroys less (though still significant amount) value is to just tax the high earners and use the proceeds to subsidize low earners. This way, you can have low earners earn as much as they would have after switching to higher paying job in your “retire early when you have Enough”, but you’d have both high and low earner continue working, so more total value would be produced. In this better alternative why would high earners continue to earn high when they can just switch to become a low earner and eat the tax from the remaining high earners.

xyzzyz 6y ago
Yes, they could do that, which is why income taxes also destroy value. They’re just not as bad as directly incentivizing people to stop working altogether.
- javajosh 6y ago
  Most people will never get to their Enough number, so your point is moot. That is, even if by some miracle Enough caught on, and people did it, talked about it, and acted on it, not much would change except, at first, there would be a wave of retirements that, presumably, would open up positions for younger folks in the industry.

javajosh 6y ago

The reason you're wrong is that high earners are usually not actively producing things. The business leaders are making allocation decisions, which are removed from production by 2-5 levels of indirection. Or, another way to look at it. All the good advice about growing rich talk about "passive income". That is, by definition, income you make despite not doing anything. The economy suffers not at all if such a person decides to do...anything with that money (other than consume it).

xyzzyz 6y ago
> The reason you're wrong is that high earners are usually not actively producing things. I don’t know what background you are coming from, but rest assured that most high earners do produce significant value. Lawyers, doctors, software engineers, architects, the list could go on an on. To be sure, some people might make money in zero sum activities, and some might exploit information asymmetries to charge significantly more than their services would be worth in perfect information scenarios. But, by and large, high earners (defined as, say, top 5% of wage workers) most definitely do provide value, in excess of what they are actually paid. It is simply hard for millions of people to convince others to give them more money than they services are worth. > Or, another way to look at it. (...) I don’t actually understand your argument in this sections. Most good advice on getting rich is not focusing on “passive income”. Instead, it focuses on investment and on providing value by entrepreneurship. People talking about “passive income” usually mean by it a kind of investment that produces returns with little to no labor input required. Given the low cost of capital today, such investments don’t usually provide high returns, and so are highly unlikely to make one rich. They can provide nice income, to be sure, but that requires becoming rich in the first place.
- javajosh 6y ago
  >Most good advice on getting rich is not focusing on “passive income”. I have to conclude you aren't arguing in good faith.

hakfoo 6y ago

A major gap is that while we can reason consciously as individuals about the values of goods and services, as an society/economy we price things unconsciously. There are many jobs that have well agreed upon social value but we have no way to wire up the economy to pay them commensurately. Think of caregivers being paid $9 per hour to clean up Grandpa's sick, or teachers who can't spend their summers on improving their craft because they have to take a menial off-season position to stay afloat. It also works on the other side-- I think you'd be hard pressed to find someone saying that top athletes and actors are worth eight figures a year on their contribution to society alone, but the market has bid them there. A much more hands-on system of wage and price controls could at least come from a conscious decision-making process.