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Ability to pay matters though too, so in one sense what you say is true but it may also be irrelevant in terms of solving the problem. If the market-clearing wa

Ability to pay matters though too, so in one sense what you say is true but it may also be irrelevant in terms of solving the problem. If the market-clearing wage for a given job at certain types of businesses is $30/hour but previously paid $25/hour that might be okay. But if it's a type of business heavy on labor costs with tight margins it might not be possible to pay $30. Raising prices is one possible answer but demand may be inelastic and business dries up at increased prices. We can argue that such businesses had unsustainable models, but that wasn't true 2.5 years ago, even if inflation has made it true today. So perfectly reasonable business models that were paying reasonable wages are, suddenly, no longer viable and maybe they collapse. I don't have a good answer for this. If they were business models that don't work if you pay a living wage I've seen some people say "well those were always bad businesses and deserve to be trimmed off the economy." For jobs a tier or two up that in this position because of recent economic trends it's not so simple. "Let them fail" seems like a neat free market solution but it also wreaks havoc on the economy with lots of people hurt and contagion spreading to other businesses as more people lose jobs, and a death spiral begins. But what's the alternative to "let them fail"? UBI? I'm in favor of experimenting in that area but I'm not convinced it's a silver bullet.

verve_rat 4y ago
No one owes anyone else a viable business. If it is not viable in current market conditions then the business owners have to adapt or shut up shop. Tough bickies.
- ineedasername 4y ago
  I agree no one is owed, and I hope the tone of my post did not imply otherwise: it wasn't my intention. But there are negative consequences to those failures of a business that bleed over into other areas, impacting businesses that may otherwise have been healthy, or bleed to the economy as a whole. In that way, it's less about what is or isn't owed to a business and more about whether external actions could be taken that keep the entire system from weakening. Take baby formula: Abbot isn't owed a functional formula plant, or government assistance to bring one back online, but not having it online impacts hundreds of thousand of babies, specifically those with special nutritional needs. Abbot screwed up an doesn't deserve tax payer money or special considerations or stop gap measures, not in the narrow sense of getting it's business in order. Bt the alternative hurts people in a very immediate & real sense. External intervention is less about helping the business and more about saving the health of many thousands of babies. That, however, is a much different circumstance than the labor shortage. I just offer it as an example where what's "owed" is not the only and maybe not even the primary issue. In the labor shortage though I just don't see a clear external action that could save collateral damage. There are no good solutions.
glogla 4y ago
This would be only true if businesses weren't posting record profits. But they mostly are.
- anamax 4y ago
  > This would be only true if businesses weren't posting record profits. But they mostly are. Mostly? Source needed. I ask because a lot of businesses are going under, which is inconsistent with "record profits."
- ineedasername 4y ago
  Some are, some aren't. Economic troubles are not distributed equally.
chii 4y ago
> But what's the alternative to "let them fail"? There isn't really an alternative that doesn't cost the tax payer. "let" is a misnomer, because no one is "letting", it's a natural consequence of the inability to profit. A business could increase their productivity or try to make do with a lower profit margin, but if none of these work, they fail.
- ineedasername 4y ago
  I suppose it's "let" in the sense that there is not government financial or policy intervention. Though I agree "let" might be the wrong word because there's a slight implication that failure is allowed despite available solutions when, in this case, alternatives are all bad just in different ways.
brudgers 4y ago
But what's the alternative to "let them fail"? There isn't an alternative to failure that is consistent with your premise of free market economics.
- ineedasername 4y ago
  It's not my premise-- I don't claim to know where the best balance between "free" and "guided" might be. It's more my observation on based on what the current situation is. In our current system I don't see a good solution.
eli_gottlieb 4y ago
>"Let them fail" seems like a neat free market solution but it also wreaks havoc on the economy with lots of people hurt and contagion spreading to other businesses as more people lose jobs, and a death spiral begins. I would just do socialism for workers rather than for bosses.
sokoloff 4y ago
> Raising prices is one possible answer but demand may be inelastic and business dries up at increased prices. Half-nit/half-tip: if demand changes when price changes, that means that demand is elastic with respect to price. Demand that does not change when prices increase is inelastic (with respect to price).
- ineedasername 4y ago
  Ah, yes, your right.
michael1999 4y ago
Creative destruction for the win.
pessimizer 4y ago
> So perfectly reasonable business models that were paying reasonable wages are, suddenly, no longer viable and maybe they collapse. No longer reasonable. Reasonable isn't a title or award you get to keep forever. > "Let them fail" seems like a neat free market solution but it also wreaks havoc on the economy with lots of people hurt and contagion spreading to other businesses as more people lose jobs, and a death spiral begins. You have to have a civil government that plans for this, rather than just making decisions to maximize business outcomes. Take care of people directly instead of propping up businesses to take care of people, which is just an avenue for corruption. UBI is an idea that gets traction due to its complete lack of detail, but a social safety net is what's called for. A federal employment agency to fix HR and guide the unemployed into retraining or extending their education and skills, pipelines into trade apprenticeships? We don't need a silver bullet, we just need a functioning government, and a reduction of the options for implementing corruption, especially with public funds. Just govern, instead of panicking when billionaires aren't governing for us, and don't have our best interests at heart.

verve_rat 4y ago

No one owes anyone else a viable business. If it is not viable in current market conditions then the business owners have to adapt or shut up shop. Tough bickies.

ineedasername 4y ago
I agree no one is owed, and I hope the tone of my post did not imply otherwise: it wasn't my intention. But there are negative consequences to those failures of a business that bleed over into other areas, impacting businesses that may otherwise have been healthy, or bleed to the economy as a whole. In that way, it's less about what is or isn't owed to a business and more about whether external actions could be taken that keep the entire system from weakening. Take baby formula: Abbot isn't owed a functional formula plant, or government assistance to bring one back online, but not having it online impacts hundreds of thousand of babies, specifically those with special nutritional needs. Abbot screwed up an doesn't deserve tax payer money or special considerations or stop gap measures, not in the narrow sense of getting it's business in order. Bt the alternative hurts people in a very immediate & real sense. External intervention is less about helping the business and more about saving the health of many thousands of babies. That, however, is a much different circumstance than the labor shortage. I just offer it as an example where what's "owed" is not the only and maybe not even the primary issue. In the labor shortage though I just don't see a clear external action that could save collateral damage. There are no good solutions.

glogla 4y ago

This would be only true if businesses weren't posting record profits. But they mostly are.

anamax 4y ago
> This would be only true if businesses weren't posting record profits. But they mostly are. Mostly? Source needed. I ask because a lot of businesses are going under, which is inconsistent with "record profits."
ineedasername 4y ago
Some are, some aren't. Economic troubles are not distributed equally.

chii 4y ago

> But what's the alternative to "let them fail"? There isn't really an alternative that doesn't cost the tax payer. "let" is a misnomer, because no one is "letting", it's a natural consequence of the inability to profit. A business could increase their productivity or try to make do with a lower profit margin, but if none of these work, they fail.

ineedasername 4y ago
I suppose it's "let" in the sense that there is not government financial or policy intervention. Though I agree "let" might be the wrong word because there's a slight implication that failure is allowed despite available solutions when, in this case, alternatives are all bad just in different ways.

brudgers 4y ago

But what's the alternative to "let them fail"? There isn't an alternative to failure that is consistent with your premise of free market economics.

ineedasername 4y ago
It's not my premise-- I don't claim to know where the best balance between "free" and "guided" might be. It's more my observation on based on what the current situation is. In our current system I don't see a good solution.

eli_gottlieb 4y ago

>"Let them fail" seems like a neat free market solution but it also wreaks havoc on the economy with lots of people hurt and contagion spreading to other businesses as more people lose jobs, and a death spiral begins. I would just do socialism for workers rather than for bosses.

sokoloff 4y ago

> Raising prices is one possible answer but demand may be inelastic and business dries up at increased prices. Half-nit/half-tip: if demand changes when price changes, that means that demand is elastic with respect to price. Demand that does not change when prices increase is inelastic (with respect to price).

ineedasername 4y ago
Ah, yes, your right.

michael1999 4y ago

Creative destruction for the win.

pessimizer 4y ago

> So perfectly reasonable business models that were paying reasonable wages are, suddenly, no longer viable and maybe they collapse. No longer reasonable. Reasonable isn't a title or award you get to keep forever. > "Let them fail" seems like a neat free market solution but it also wreaks havoc on the economy with lots of people hurt and contagion spreading to other businesses as more people lose jobs, and a death spiral begins. You have to have a civil government that plans for this, rather than just making decisions to maximize business outcomes. Take care of people directly instead of propping up businesses to take care of people, which is just an avenue for corruption. UBI is an idea that gets traction due to its complete lack of detail, but a social safety net is what's called for. A federal employment agency to fix HR and guide the unemployed into retraining or extending their education and skills, pipelines into trade apprenticeships? We don't need a silver bullet, we just need a functioning government, and a reduction of the options for implementing corruption, especially with public funds. Just govern, instead of panicking when billionaires aren't governing for us, and don't have our best interests at heart.