6 ms·

Isn't this a problem that fixes itself? People have lots of money and throw it at stupid businesses and lose it.

by bko 2y ago

nicbou 2y ago
They aren't building libraries with it, but sustaining an underpaid workforce. Someone loses a million, a million gets a few cents.
- jjmarr 2y ago
  So, direct wealth transfer is happening from the rich to the poor. The only flaw with this is that people have to work economically inefficient jobs delivering food, instead of the wealth transfer occurring through taxes on the rich and funding something like basic sciences.
  - dralley 2y ago
    It's equivalent to "broken window" spending. Yes, breaking a window allows you to generate economic activity by paying the manufacturer to create a new one and paying an installer to install it, but it's not socially useful economic activity. You could have spent the same money building excess renewable energy resources, or on basic science research, or a million other things that might be equally "inefficient" from an investment standpoint but at least have a chance of providing benefit to society. It's a serious flaw and not one that can be waved off as easily as you do.
    - ianferrel 2y ago
      I disagree with that. In the case of food delivery, there's socially and economically useful work of getting food from where it can be efficiently created (restaurants) to where it can be efficiently consumed (hungry people's location). In the absence of that work, the hungry people would be making their own food (less efficient, generally, than restaurant cooking which can do larger batches) or going to get their own food (less efficient, at least plausibly, because a delivery worker can make multiple deliveries on one drive rather than a strict out and back trip that people would take). The thing that makes fixing a broken window "fake" economic growth is that it is arguing that destruction is economically useful because of the work to fix it, but nothing's being broken in this case. People are naturally hungry on a pretty regular basis, and the production and transportation of food is economically and socially useful work, which in this case was being subsidized by capital. Is it curing cancer? No, but it's not digging holes and filling them up again either.
      - nsxwolf 2y ago
        It's completely ruined pizza delivery, which used to actually be a pleasant and affordable experience.
        lotsoweiners 2y ago
        How do you figure? I still order pizza, pay a small delivery fee and tip, and receive my order in around 30-45 minutes. I haven’t noticed a change other than I no longer call a store to order and I can get pizza delivery from places that didn’t deliver before.
        nsxwolf 2y ago
        I've never seen a DoorDasher show up with a proper insulated bag. The pizzas are cold. They've been on who knows what route delivering orders from who knows how many restaurants. They slide around, aren't kept level. I had an order where only 1 out of 5 pizzas showed up. The driver didn't speak English, but it wouldn't matter if he'd been able to. Because the driver isn't empowered to help in any way. They don't represent the restaurant, and everything has to go through DoorDash customer service. Getting my refund took 4 phone calls, multiple online chats, and 30 days.
      - ThunderSizzle 2y ago
        Here's the part that breaks down: If restaurants were more efficient, then why are restaurants (1) more expensive, (2) using worse ingredients, (3) taking longer, and (4) have questionable quality. Granted, I'd understand if in the good-fast-cheap triangle, you lose one, but with restaurants, most are questionable quality, take longer, and have gotten expensive. I can make better food faster with better ingredients for a cheaper price at my own house for my own family, as long as we did some thi king ahead and planning. On top of that, when I make a new recipe, I learn how to make something new with new ingredients that helps me do more exotic dishes in the future. It's not entirely clear to me restaurants are the theoretical economic efficient location that is claimed. Even if you use fast food, their prices have gotten higher and quality even more questionable on the already garbage quality they had. It seems to me there is more efficiency in people learning to make their own food, and cooking better at home - both in the results and the discipline on the person. Sometimes decentralization is more efficient than centralization, and I think this is an example. I will say optimizing grocery delivery makes alot more sense ro me than restaurant delivery.
    - Chris2048 2y ago
      I've heard of the "broken window fallacy", and this seems an incorrect representation. The fallacy is that breaking windows must have an inherent value (and the fallacy is that its a good thing to have vandalism). Part of the justification that it might be otherwise is the benefit of having window repairmen, and how they couldn't exist if they didn't have a steady income - and it's here that lies the fault, however the fault is one of quantification, in fact a broken window can be socially useful, just with decreasing usefulness as quantity increases, plus there are better ways to do it (e.g. insurance payment); It's still true that (in an unmanaged market) if (somehow) there aren't enough broken windows, when one breaks there might not be anyone who can repair it (economically) - I think it's the same category of problem as, donating clothes to Africa destroys its own textile biz.
- digging 2y ago
  No, this misses that much of the money is just circulating around the capital holders.
madaxe_again 2y ago
No, because it’s a circular economy - at no point does that wealth reach workers, it just ends up in the hands of other plutocrats.
- RandallBrown 2y ago
  How exactly does the money that a company like DoorDash loses end up with other plutocrats? Isn't most of that money being paid to people working for those companies?
  - lambertsimnel 2y ago
    Am I right in thinking that if those employees save any of the money, then they accumulate wealth, but if they don't (because they don't receive enough compared to their fixed costs, or for any other reason) wealth accumulates elsewhere, probably in the hands of plutocrats?
    - nickff 2y ago
      Just because one person wastes money, it doesn't mean that someone else gets rich. If the employees spend their income on low-margin goods or services (food and clothing are quite competitive low-margin sectors with high labor costs), the money has flowed from investors mostly to laborers.
      - lambertsimnel 2y ago
        My thinking is that spending gets split between richer and poorer people. The former buy assets with it, but the latter spend it on living costs. Each time it circulates, typically some goes to richer people and stops circulating. Various things could disrupt the resulting increase in inequality. The Black Death and World War 2 are both supposed to have done so.
        nickff 2y ago
        Money doesn’t really get “split”, it flows, and the where it goes each time it is spent is what determines who makes how much. You’re right that some people are able to accumulate, but that’s not a default, and the money usually doesn’t stay put for long.
al_borland 2y ago
With these food delivery apps they managed to make a system where everyone loses. It’s astounding. When everyone is paying more, while earning less, I’m not sure how the problem fixes itself. I think these apps just need to go away and business that want to offer delivery can go back to how it used to be done. It was cheaper and better.
- itsdavesanders 2y ago
  IS it cheaper? Better, maybe, depending on the restaurant. But I can’t see how it’s cheaper when you have to hire and insure drivers, manage shifts, deal with delivery areas, fuel costs, more accounting, etc etc. Also I live in a pretty good sized city of about 350k in our metro area, and before these delivery services only the national pizza places delivered. When I moved here from a larger city I was shocked there wasn’t a single Chinese delivery place. So I’m thinking that the costs and management were just too high. The right model might be the Waiter on the Way model, which hires regular drivers but can offer the service turnkey. But there needs to be more of those, and there doesn’t seem to be for some reason.
  - dom96 2y ago
    I lived in a tiny town in Northern Ireland and every chinese/indian/pizza place managed to deliver food just fine. They still do I bet. UberEats/Deliveroo/DoorDash are just skimming the little profit that these operations made (and failing to be profitable)
  - al_borland 2y ago
    >Also I live in a pretty good sized city of about 350k in our metro area, and before these delivery services only the national pizza places delivered. When I moved here from a larger city I was shocked there wasn’t a single Chinese delivery place. So I’m thinking that the costs and management were just too high. This is interesting. When I was in college I could order Chinese delivery from about 5 different places, and they'd do it until about 4 or 5am. This was in a city of about 78k. After school I moved to another college town. It was double the population with a much more well known school. In this town, I don't think there was any Chinese delivery, and a vast majority of the places closed really early for a college town; maybe 8-10pm. I wonder if smaller towns with lower rent leave more margin for extra hours and delivery, where as those with higher rents need to focus on staffing the core hours with as few people as possible to make the books balance? Just a theory, as I've never worked in these industries. Near me, I still see Dominos doing their own delivery, with their corporate owned vehicles. I also see some local pizza places doing their own delivery as well. Jimmy Johns still does its own delivery as well, even if going through Door Dash, they just hand off the order, it doesn't go through the normal Door Dash process.
winternett 2y ago
We've had scam industries like this for ages... If you're old enough there's Time shares, Amway, numerous companies that have sold fake health supplements etc... It hasn't resolves anything beyond money and work being extracted from people with no reward. Valid business, like taxi cabs, are destroyed by Uber and door dash, and the people that work for these services get ripped off. Many of these businesses are purely exploitative. Even Dominos is using 3rd party delivery services now, instead of hiring drivers, it has made their prices skyrocket on top of already ridiculous inflation. It even prices people out of being able to afford pretty much D-class pizza. Even if the model melts down, the original (more valuable) business model may be so decimated that it won't be able to be brought back. Our world is suffering from trust funders with bad and amateur business ideas, all trying to become market-cornering monopolies, it's long overdue to encourage them to find better and less destructive idea builders and better ideas by others to fund instead of launching poorly though out and highly exploitative profit schemes.
AmpsterMan 2y ago
The market can stay silly longer than I can stay solvent

Isn't this a problem that fixes itself? People have lots of money and throw it at stupid businesses and lose it.

by bko 2y ago

Isn't this a problem that fixes itself? People have lots of money and throw it at stupid businesses and lose it.

They aren't building libraries with it, but sustaining an underpaid workforce. Someone loses a million, a million gets a few cents.

jjmarr 2y ago
So, direct wealth transfer is happening from the rich to the poor. The only flaw with this is that people have to work economically inefficient jobs delivering food, instead of the wealth transfer occurring through taxes on the rich and funding something like basic sciences.
- dralley 2y ago
  It's equivalent to "broken window" spending. Yes, breaking a window allows you to generate economic activity by paying the manufacturer to create a new one and paying an installer to install it, but it's not socially useful economic activity. You could have spent the same money building excess renewable energy resources, or on basic science research, or a million other things that might be equally "inefficient" from an investment standpoint but at least have a chance of providing benefit to society. It's a serious flaw and not one that can be waved off as easily as you do.
  - ianferrel 2y ago
    I disagree with that. In the case of food delivery, there's socially and economically useful work of getting food from where it can be efficiently created (restaurants) to where it can be efficiently consumed (hungry people's location). In the absence of that work, the hungry people would be making their own food (less efficient, generally, than restaurant cooking which can do larger batches) or going to get their own food (less efficient, at least plausibly, because a delivery worker can make multiple deliveries on one drive rather than a strict out and back trip that people would take). The thing that makes fixing a broken window "fake" economic growth is that it is arguing that destruction is economically useful because of the work to fix it, but nothing's being broken in this case. People are naturally hungry on a pretty regular basis, and the production and transportation of food is economically and socially useful work, which in this case was being subsidized by capital. Is it curing cancer? No, but it's not digging holes and filling them up again either.
    - nsxwolf 2y ago
      It's completely ruined pizza delivery, which used to actually be a pleasant and affordable experience.
      - lotsoweiners 2y ago
        How do you figure? I still order pizza, pay a small delivery fee and tip, and receive my order in around 30-45 minutes. I haven’t noticed a change other than I no longer call a store to order and I can get pizza delivery from places that didn’t deliver before.
        nsxwolf 2y ago
        I've never seen a DoorDasher show up with a proper insulated bag. The pizzas are cold. They've been on who knows what route delivering orders from who knows how many restaurants. They slide around, aren't kept level. I had an order where only 1 out of 5 pizzas showed up. The driver didn't speak English, but it wouldn't matter if he'd been able to. Because the driver isn't empowered to help in any way. They don't represent the restaurant, and everything has to go through DoorDash customer service. Getting my refund took 4 phone calls, multiple online chats, and 30 days.
    - ThunderSizzle 2y ago
      Here's the part that breaks down: If restaurants were more efficient, then why are restaurants (1) more expensive, (2) using worse ingredients, (3) taking longer, and (4) have questionable quality. Granted, I'd understand if in the good-fast-cheap triangle, you lose one, but with restaurants, most are questionable quality, take longer, and have gotten expensive. I can make better food faster with better ingredients for a cheaper price at my own house for my own family, as long as we did some thi king ahead and planning. On top of that, when I make a new recipe, I learn how to make something new with new ingredients that helps me do more exotic dishes in the future. It's not entirely clear to me restaurants are the theoretical economic efficient location that is claimed. Even if you use fast food, their prices have gotten higher and quality even more questionable on the already garbage quality they had. It seems to me there is more efficiency in people learning to make their own food, and cooking better at home - both in the results and the discipline on the person. Sometimes decentralization is more efficient than centralization, and I think this is an example. I will say optimizing grocery delivery makes alot more sense ro me than restaurant delivery.
  - Chris2048 2y ago
    I've heard of the "broken window fallacy", and this seems an incorrect representation. The fallacy is that breaking windows must have an inherent value (and the fallacy is that its a good thing to have vandalism). Part of the justification that it might be otherwise is the benefit of having window repairmen, and how they couldn't exist if they didn't have a steady income - and it's here that lies the fault, however the fault is one of quantification, in fact a broken window can be socially useful, just with decreasing usefulness as quantity increases, plus there are better ways to do it (e.g. insurance payment); It's still true that (in an unmanaged market) if (somehow) there aren't enough broken windows, when one breaks there might not be anyone who can repair it (economically) - I think it's the same category of problem as, donating clothes to Africa destroys its own textile biz.
digging 2y ago
No, this misses that much of the money is just circulating around the capital holders.

madaxe_again 2y ago

No, because it’s a circular economy - at no point does that wealth reach workers, it just ends up in the hands of other plutocrats.

RandallBrown 2y ago
How exactly does the money that a company like DoorDash loses end up with other plutocrats? Isn't most of that money being paid to people working for those companies?
- lambertsimnel 2y ago
  Am I right in thinking that if those employees save any of the money, then they accumulate wealth, but if they don't (because they don't receive enough compared to their fixed costs, or for any other reason) wealth accumulates elsewhere, probably in the hands of plutocrats?
  - nickff 2y ago
    Just because one person wastes money, it doesn't mean that someone else gets rich. If the employees spend their income on low-margin goods or services (food and clothing are quite competitive low-margin sectors with high labor costs), the money has flowed from investors mostly to laborers.
    - lambertsimnel 2y ago
      My thinking is that spending gets split between richer and poorer people. The former buy assets with it, but the latter spend it on living costs. Each time it circulates, typically some goes to richer people and stops circulating. Various things could disrupt the resulting increase in inequality. The Black Death and World War 2 are both supposed to have done so.
      - nickff 2y ago
        Money doesn’t really get “split”, it flows, and the where it goes each time it is spent is what determines who makes how much. You’re right that some people are able to accumulate, but that’s not a default, and the money usually doesn’t stay put for long.

al_borland 2y ago

With these food delivery apps they managed to make a system where everyone loses. It’s astounding. When everyone is paying more, while earning less, I’m not sure how the problem fixes itself. I think these apps just need to go away and business that want to offer delivery can go back to how it used to be done. It was cheaper and better.

itsdavesanders 2y ago
IS it cheaper? Better, maybe, depending on the restaurant. But I can’t see how it’s cheaper when you have to hire and insure drivers, manage shifts, deal with delivery areas, fuel costs, more accounting, etc etc. Also I live in a pretty good sized city of about 350k in our metro area, and before these delivery services only the national pizza places delivered. When I moved here from a larger city I was shocked there wasn’t a single Chinese delivery place. So I’m thinking that the costs and management were just too high. The right model might be the Waiter on the Way model, which hires regular drivers but can offer the service turnkey. But there needs to be more of those, and there doesn’t seem to be for some reason.
- dom96 2y ago
  I lived in a tiny town in Northern Ireland and every chinese/indian/pizza place managed to deliver food just fine. They still do I bet. UberEats/Deliveroo/DoorDash are just skimming the little profit that these operations made (and failing to be profitable)
- al_borland 2y ago
  >Also I live in a pretty good sized city of about 350k in our metro area, and before these delivery services only the national pizza places delivered. When I moved here from a larger city I was shocked there wasn’t a single Chinese delivery place. So I’m thinking that the costs and management were just too high. This is interesting. When I was in college I could order Chinese delivery from about 5 different places, and they'd do it until about 4 or 5am. This was in a city of about 78k. After school I moved to another college town. It was double the population with a much more well known school. In this town, I don't think there was any Chinese delivery, and a vast majority of the places closed really early for a college town; maybe 8-10pm. I wonder if smaller towns with lower rent leave more margin for extra hours and delivery, where as those with higher rents need to focus on staffing the core hours with as few people as possible to make the books balance? Just a theory, as I've never worked in these industries. Near me, I still see Dominos doing their own delivery, with their corporate owned vehicles. I also see some local pizza places doing their own delivery as well. Jimmy Johns still does its own delivery as well, even if going through Door Dash, they just hand off the order, it doesn't go through the normal Door Dash process.

winternett 2y ago

We've had scam industries like this for ages... If you're old enough there's Time shares, Amway, numerous companies that have sold fake health supplements etc... It hasn't resolves anything beyond money and work being extracted from people with no reward. Valid business, like taxi cabs, are destroyed by Uber and door dash, and the people that work for these services get ripped off. Many of these businesses are purely exploitative. Even Dominos is using 3rd party delivery services now, instead of hiring drivers, it has made their prices skyrocket on top of already ridiculous inflation. It even prices people out of being able to afford pretty much D-class pizza. Even if the model melts down, the original (more valuable) business model may be so decimated that it won't be able to be brought back. Our world is suffering from trust funders with bad and amateur business ideas, all trying to become market-cornering monopolies, it's long overdue to encourage them to find better and less destructive idea builders and better ideas by others to fund instead of launching poorly though out and highly exploitative profit schemes.

AmpsterMan 2y ago

The market can stay silly longer than I can stay solvent