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Economics always win. If the labor supply increases, new enterprises will be able to hire and grow. This will shrink the labor supply and increase the price of

Economics always win. If the labor supply increases, new enterprises will be able to hire and grow. This will shrink the labor supply and increase the price of labor. The only time there are massive shifts are when some sizeable factor creates a disruption. Sometimes that’s technology advancement. Other times it’s a policy change due to government intervention. The area where I live used to be the textile capital of the world until a policy change shifted all of it overseas and gutted the entire area. And now that same area is thriving after years of being destitute. Old mills converted to fancy apartments. Old train tracks used to ship product converted to bike trails. Thriving tech community. It ebbs and flows. But nobody making centralized decisions would have made the choices that led to it.

Retric 3y ago
Economics doesn’t guarantee absolute efficiency just a reasonable approximation of efficiency. Moderate unemployment is one such inefficiency, but so is misallocated labor. A worker moving to a higher paying job is hypothetically a more optimal allocation of resources because they can only be paid more if they are creating more value. However, the real world is messy and therefore the price signaling around pay isn’t perfect just as stock pricing isn’t perfect either… The bizarre thing is in practice capitalism works so well despite these issues even before you consider government intervention, monopolies, incentives misalignment etc. However at some point it’s less about the system than the people operating it.
- pydry 3y ago
  >The bizarre thing is in practice capitalism works so well Does it? It's exacerbating environmental destruction, it creates all manner of bullshit jobs that are an epic waste of human potential and it has created a massive underclass who can't even afford the roof over their head. I dont think this economic system will be looked upon fondly in 500 years any more than we're impressed with the divine right of kings.
  - fallingknife 3y ago
    Compare with the USSR where there was minimal environmental destruction, no bullshit bureaucratic jobs, and of course, no poor people.
    - goatlover 3y ago
      Also where the saying, "We pretend to work and the they pretend to pay us", comes from.
      - pydry 3y ago
        The USSR suffered from the resource curse towards the end. Its an affliction that has destroyed many economies of all stripes. It's the same reason why most of Africa is an economic basket case. The USSR was instrumental to mankind becoming a spacefaring species. The US wasnt even interested until the USSR started and lost interest once they landed a man on the moon and declared that they had "won" the race. Were they still around space exploration probably wouldn't have stalled. They were also instrumental in keeping the US government in line. US elites were terrified that the USSR and domestic communists might join forces to overthrow them. Elite fear of communists is why people in the 1950s could easily afford college, medical care and a roof over their head and why they were guaranteed a job doing something meaningful like building a dam or a bridge. You're probably right that it's better that our finest minds are dedicated to making people click on ads and take out loans, though. This truly is the pinnacle of civilization. You have a whole computer in your pocket. You might have been able to buy a house in the 1950s and not be bankrupted by medical bills, but you couldn't play flappy birds.
        Retric 3y ago
        You’re incorrect in terms of the space program. The US and Great Britain etc where very interested in rocketry and therefore spending significant sums before Sputnik. Which is how the US was able to launch a satellite in 1958 a year after Sputnik. You don’t go from knowing nothing about rockets to launching a satellite in a year. Further, the US slowed down but didn’t abandon its manned space program. It was spending a frankly crazy amount of money on a publicly stunt to get people to the moon, but we’ve continued to invest in the space program over the long term. Actually going past the moon requires long term habitation in space thus the interest in space stations.

Retric 3y ago

Economics doesn’t guarantee absolute efficiency just a reasonable approximation of efficiency. Moderate unemployment is one such inefficiency, but so is misallocated labor. A worker moving to a higher paying job is hypothetically a more optimal allocation of resources because they can only be paid more if they are creating more value. However, the real world is messy and therefore the price signaling around pay isn’t perfect just as stock pricing isn’t perfect either… The bizarre thing is in practice capitalism works so well despite these issues even before you consider government intervention, monopolies, incentives misalignment etc. However at some point it’s less about the system than the people operating it.

pydry 3y ago
>The bizarre thing is in practice capitalism works so well Does it? It's exacerbating environmental destruction, it creates all manner of bullshit jobs that are an epic waste of human potential and it has created a massive underclass who can't even afford the roof over their head. I dont think this economic system will be looked upon fondly in 500 years any more than we're impressed with the divine right of kings.
- fallingknife 3y ago
  Compare with the USSR where there was minimal environmental destruction, no bullshit bureaucratic jobs, and of course, no poor people.
  - goatlover 3y ago
    Also where the saying, "We pretend to work and the they pretend to pay us", comes from.
    - pydry 3y ago
      The USSR suffered from the resource curse towards the end. Its an affliction that has destroyed many economies of all stripes. It's the same reason why most of Africa is an economic basket case. The USSR was instrumental to mankind becoming a spacefaring species. The US wasnt even interested until the USSR started and lost interest once they landed a man on the moon and declared that they had "won" the race. Were they still around space exploration probably wouldn't have stalled. They were also instrumental in keeping the US government in line. US elites were terrified that the USSR and domestic communists might join forces to overthrow them. Elite fear of communists is why people in the 1950s could easily afford college, medical care and a roof over their head and why they were guaranteed a job doing something meaningful like building a dam or a bridge. You're probably right that it's better that our finest minds are dedicated to making people click on ads and take out loans, though. This truly is the pinnacle of civilization. You have a whole computer in your pocket. You might have been able to buy a house in the 1950s and not be bankrupted by medical bills, but you couldn't play flappy birds.
      - Retric 3y ago
        You’re incorrect in terms of the space program. The US and Great Britain etc where very interested in rocketry and therefore spending significant sums before Sputnik. Which is how the US was able to launch a satellite in 1958 a year after Sputnik. You don’t go from knowing nothing about rockets to launching a satellite in a year. Further, the US slowed down but didn’t abandon its manned space program. It was spending a frankly crazy amount of money on a publicly stunt to get people to the moon, but we’ve continued to invest in the space program over the long term. Actually going past the moon requires long term habitation in space thus the interest in space stations.