3 ms·

Are you Paul Krugman or something? I mean, there aren't any examples of what you're suggesting at least in the past hundred years, and yet you suggest it might

by m0zg 5y ago

Are you Paul Krugman or something? I mean, there aren't any examples of what you're suggesting at least in the past hundred years, and yet you suggest it might happen. Might it? Sure, I might win a PowerBall jackpot next week, too. Will it? Based on historical evidence chances of it happening are nil. I'd be willing to bet hard cash on this outcome. There's also no plausible mechanism, short of a dramatic reduction in labor supply, that could drive a macroeconomic trend like this. Not to mention that even if it does happen, the prices will rise faster than wages - labor is a good chunk of the price in the first place, and you, the employer gotta pay social security off those increased wages, so bake in another 6% into that labor cost delta. Guess who will be paying for that? The consumer, AKA the working class largely. And this absolutely, under no circumstances, will cause any "wealth redistribution" from the rich to the poor. It'll be in the other direction. The rich can pay the poor in worthless QE fiat, while they hold inflation-protected assets. I've seen this shit happen with my own eyes and experienced it on my own skin in the 90s in Russia. I didn't have any money back then, but my parents had a little, and they lost pretty much all of their life's savings.

lotsofpulp 5y ago
Does poor people in China moving up the socioeconomic ladder compared to the “middle class” factory workers in the US who moved down the socioeconomic ladder not count as if happening in the previous century? > There's also no plausible mechanism, short of a dramatic reduction in labor supply, that could drive a macroeconomic trend like this. Is proportion of working age population and fertility rates not going down? Of course they can be offset with immigration and automation, but will it be for the types of labor requested by the increasing proportion of old people? I do not know the future for sure, but one big variable that has changed is slowing population growth. The government can print all the fiat it wants, but it will not make the necessary labor appear out of thin air if people are not having kids at the same rate as before. Immigration and automation might blunt the impact of slowing population growth, but it may not be able to absorb all of it.
- m0zg 5y ago
  China is experiencing increasing demand for labor thanks to our inability to make stuff in the Rust Belt. China is also, at least to some extent, a planned economy (and has planned demographics, too). As such it is subject to a different set of supply/demand tradeoffs, and definitely not a good pattern to extrapolate from. Any fertility-related stuff will take decades to play out, and it'd have to outpace off-shoring, legal immigration, and illegal migration, none of which is the case today or will be in the foreseeable future. It is not the case specifically for this reason: the rich like abundant supply of cheap labor. They achieve this abundance through both reducing demand and increased supply. Worse, reduced fertility will result in state's inability to provide social services and healthcare to the elderly poor, which means rising taxes and therefore further acceleration of off-shoring. In this regard we are too very much unlike China where the young are supposed to care for _their_ elderly. If our government thought at least 20 years ahead, they'd be trying to stimulate the birth rate, boost manufacturing, and they'd clamp down on the borders. But their planning horizon does not extend beyond 4 years, unlike, say, Xi Jinping's.
  - chii 5y ago
    > our government thought at least 20 years ahead, they'd be trying to stimulate the birth rate, boost manufacturing, and they'd clamp down on the borders. it is hubris to think that mere mortals can predict complex chaotic systems 20 yrs ahead. I think allowing people the freedom to choose and let individuals make the best choices available to them is really the only "good" way forward. Planning an economy, or planning population growth, as seen done in the past, had not ever worked out.
    - m0zg 5y ago
      I did not say they can "predict" such systems. Plans are useless, planning is indispensable. You can course correct as you go, as long as you're going somewhere in particular, which I'm not sure we are at this point.

by m0zg 5y ago

lotsofpulp 5y ago

Does poor people in China moving up the socioeconomic ladder compared to the “middle class” factory workers in the US who moved down the socioeconomic ladder not count as if happening in the previous century? > There's also no plausible mechanism, short of a dramatic reduction in labor supply, that could drive a macroeconomic trend like this. Is proportion of working age population and fertility rates not going down? Of course they can be offset with immigration and automation, but will it be for the types of labor requested by the increasing proportion of old people? I do not know the future for sure, but one big variable that has changed is slowing population growth. The government can print all the fiat it wants, but it will not make the necessary labor appear out of thin air if people are not having kids at the same rate as before. Immigration and automation might blunt the impact of slowing population growth, but it may not be able to absorb all of it.

m0zg 5y ago
China is experiencing increasing demand for labor thanks to our inability to make stuff in the Rust Belt. China is also, at least to some extent, a planned economy (and has planned demographics, too). As such it is subject to a different set of supply/demand tradeoffs, and definitely not a good pattern to extrapolate from. Any fertility-related stuff will take decades to play out, and it'd have to outpace off-shoring, legal immigration, and illegal migration, none of which is the case today or will be in the foreseeable future. It is not the case specifically for this reason: the rich like abundant supply of cheap labor. They achieve this abundance through both reducing demand and increased supply. Worse, reduced fertility will result in state's inability to provide social services and healthcare to the elderly poor, which means rising taxes and therefore further acceleration of off-shoring. In this regard we are too very much unlike China where the young are supposed to care for _their_ elderly. If our government thought at least 20 years ahead, they'd be trying to stimulate the birth rate, boost manufacturing, and they'd clamp down on the borders. But their planning horizon does not extend beyond 4 years, unlike, say, Xi Jinping's.
- chii 5y ago
  > our government thought at least 20 years ahead, they'd be trying to stimulate the birth rate, boost manufacturing, and they'd clamp down on the borders. it is hubris to think that mere mortals can predict complex chaotic systems 20 yrs ahead. I think allowing people the freedom to choose and let individuals make the best choices available to them is really the only "good" way forward. Planning an economy, or planning population growth, as seen done in the past, had not ever worked out.
  - m0zg 5y ago
    I did not say they can "predict" such systems. Plans are useless, planning is indispensable. You can course correct as you go, as long as you're going somewhere in particular, which I'm not sure we are at this point.