4 ms·

Imo, part of the reason at least. Still, I'm interested in your other reasons if you got any.

onlyrealcuzzo 4y ago
We don't produce enough! Imagine a world in which the only product is apples. If everyone needs 3 apples per day to be healthy and happy - and you only produce 1 apple per person - it does not matter if the richest 0.1% get 200 apples per day. If you distributed them evenly, there is still not enough apples. And distributing them evenly does not even improve things in any significant way. Sure, it is a problem. The bottom decile that lives on .1 apple per day now gets .3 apples per day. But they still don't even have close to enough apples! Neither does anyone else! People like to hand-wave this away. But GLOBAL GDP per capita is less than $11,000 per year. That is NOT enough money for everyone to have a house with a white picket fence, and a car in the garage, and a chicken in the oven, and a wife who stays at home and takes care of the kids. It's not even enough for everyone to live a life that resembles being upper lower class in France. And remember, the rich pay most of the taxes. Now you have to pay an even share - so of your $11,000, 25% of that is taxes! You only actually get ~$8,200. ~$8,200 per year wouldn't even qualify you for a mortgage to buy a $35,000 house. That's barely buying you enough materials to build a dollhouse. It's not buying you land anywhere you'd want live. And it's definitely not enough to connect to utilities. Distribution is a problem. THE problem is total output. ~$11,000 per person per year. Remember this is in inflated 2022 dollars - ~$9000 in 2019 dollars - this is including all-time highs due to massive stimulus and unprecedented levels of debt. ~$9000 in 2019 dollars is Mexico's GDP per capita - Bulgaria & Belarus. I love Mexico to death - but these are not paradises. Globally, the much bigger problem is that there are not enough apples being produced! Locally, in the US and the EU - GDP per capita is quite high. If we lived in a socialized society, sure, things could definitely be better for minimum wage workers. But I'm quitting my job at FAANG tomorrow to be a yoga teacher if I make the same amount of money. I don't know who in their right mind is going to continue being a nurse or most doctors. I'm not sure why many people are going to do hard physical labor like construction or dangerous jobs like fighting fires and crime - if everyone makes the same amount of money... Good luck keeping production high and society functioning...
- oreally 4y ago
  I do think relying on production has it's limits. Countries would rather save up on apples, be self sufficient for a rainy day rather than spend them. Given how my (non-western) dollar converts to USD, I wouldn't hire a US person for grunt work unless he/she had specific expertise to teach or a local knowledge bias for when my firm expands to the US. So there's less inflow to the US, and only to a select few people. So where does that lead us to? The US printing money and doing as much as it can to mitigate the side effects. So your population has only a select few who get the inflows. And you can tax them for distribution. And chances are you're not going to get other countries to spend their apples. You could get workers to accept lower pay rates, but I highly doubt it's possible without upsetting stability. Are you doomed to huge amounts of money printing then? Maybe you'd get away with it since you're the US after all.

We don't produce enough! Imagine a world in which the only product is apples. If everyone needs 3 apples per day to be healthy and happy - and you only produce 1 apple per person - it does not matter if the richest 0.1% get 200 apples per day. If you distributed them evenly, there is still not enough apples. And distributing them evenly does not even improve things in any significant way. Sure, it is a problem. The bottom decile that lives on .1 apple per day now gets .3 apples per day. But they still don't even have close to enough apples! Neither does anyone else! People like to hand-wave this away. But GLOBAL GDP per capita is less than $11,000 per year. That is NOT enough money for everyone to have a house with a white picket fence, and a car in the garage, and a chicken in the oven, and a wife who stays at home and takes care of the kids. It's not even enough for everyone to live a life that resembles being upper lower class in France. And remember, the rich pay most of the taxes. Now you have to pay an even share - so of your $11,000, 25% of that is taxes! You only actually get ~$8,200. ~$8,200 per year wouldn't even qualify you for a mortgage to buy a $35,000 house. That's barely buying you enough materials to build a dollhouse. It's not buying you land anywhere you'd want live. And it's definitely not enough to connect to utilities. Distribution is a problem. THE problem is total output. ~$11,000 per person per year. Remember this is in inflated 2022 dollars - ~$9000 in 2019 dollars - this is including all-time highs due to massive stimulus and unprecedented levels of debt. ~$9000 in 2019 dollars is Mexico's GDP per capita - Bulgaria & Belarus. I love Mexico to death - but these are not paradises. Globally, the much bigger problem is that there are not enough apples being produced! Locally, in the US and the EU - GDP per capita is quite high. If we lived in a socialized society, sure, things could definitely be better for minimum wage workers. But I'm quitting my job at FAANG tomorrow to be a yoga teacher if I make the same amount of money. I don't know who in their right mind is going to continue being a nurse or most doctors. I'm not sure why many people are going to do hard physical labor like construction or dangerous jobs like fighting fires and crime - if everyone makes the same amount of money... Good luck keeping production high and society functioning...

oreally 4y ago
I do think relying on production has it's limits. Countries would rather save up on apples, be self sufficient for a rainy day rather than spend them. Given how my (non-western) dollar converts to USD, I wouldn't hire a US person for grunt work unless he/she had specific expertise to teach or a local knowledge bias for when my firm expands to the US. So there's less inflow to the US, and only to a select few people. So where does that lead us to? The US printing money and doing as much as it can to mitigate the side effects. So your population has only a select few who get the inflows. And you can tax them for distribution. And chances are you're not going to get other countries to spend their apples. You could get workers to accept lower pay rates, but I highly doubt it's possible without upsetting stability. Are you doomed to huge amounts of money printing then? Maybe you'd get away with it since you're the US after all.