4 ms·

The point is how it circulates. If €200M goes into a transfer fee, it is locked into a prestige loop instead of funding productive investment, it gets trapped i

by gloosx 1y ago

The point is how it circulates. If €200M goes into a transfer fee, it is locked into a prestige loop instead of funding productive investment, it gets trapped in a cycle that reinforces inequality and produces very little outside of image-building. The recipients of this money are a tiny elite which they then spend mostly in elite consumption loops: luxury real estate, yachts, exclusive services, tax havens. Speaking capitalist language, overinflated football spending is a misallocation of capital on low-return assets which creates market distortions.

fluoridation 1y ago
>luxury real estate, yachts, exclusive services, tax havens All of that eventually has to flow back into, as you'd put it, non-elite segments of the economy. What, do you think shipyard workers eat yatchs? There's no subnetwork in the economy where money flows in and never comes back out. That just doesn't exist.
- gloosx 1y ago
  "money always comes back" view is too simplistic. Value can absolutely be destroyed or locked away: Build a $2M missile -> launch -> it explodes. The workers get wages, sure, but the capital value is literally blown up. No ongoing benefit to the wider economy. Stadiums for Olympics/World Cups -> billions spent -> used for 2 weeks -> abandoned. Money circulates in construction wages, but the asset sits idle, draining maintenance costs. Buy a $450M painting -> store it in a tax-free warehouse -> never seen, never sold for decades. That capital is locked — the flow stops until resale. So yes, wages circulate. But the end product can be waste, destruction, or dead capital. That is the difference between circulation and productive reinvestment.
  - fluoridation 1y ago
    >Build a $2M missile -> launch -> it explodes. The workers get wages, sure, but the capital value is literally blown up. No ongoing benefit to the wider economy. >Stadiums for Olympics/World Cups -> billions spent -> used for 2 weeks -> abandoned. Money circulates in construction wages, but the asset sits idle, draining maintenance costs. You have no possible way to quantify the wastefulness of an action. Blowing up a rocket can help prevent more waste. You can feed someone a bowl of soup that makes them sick. With what omniscience do you get to deem a club's expenses wasteful? >Buy a $450M painting -> store it in a tax-free warehouse -> never seen, never sold for decades. That capital is locked — the flow stops until resale. No kidding? The thing you bought stays with you until you sell it? Sorry, how is this different from literally anything else? >But the end product can be waste, destruction, or dead capital. That is the difference between circulation and productive reinvestment. Let's say I'm the richest man in the world, and I use half of my wealth to pay people to dig the biggest, deepest hole possible, and then the other half to fill it back up. I'm sure both you and I will agree that that's a purely wasteful endeavor that would accomplish nothing. Ignoring ecological destruction, who was harmed? What was lost, and who lost it?
    - gloosx 1y ago
      >What was lost, and who lost it? What's lost is opportunity. All that wealth could have gone into projects that produce lasting value: infrastructure, innovation, healthcare. Instead, it was sunk into an activity with no return. Misallocation of capital is a loss measured in foregone progress, society ends up poorer than it could have been, because while we could have had a new hospital or brigde, workers were busy digging some literal shithole. Does it answer your question?
      - fluoridation 1y ago
        >What's lost is opportunity. Surely it's my problem and my problem alone if I want to lose the opportunity to spend my money in something fruitful to instead spend it in something pointless and worthless. >while we could have had a new hospital or brigde Well, no. It was my money I spent. Regardless of what I was going to do with it, building hospitals and bridges was never in the cards. Let's say that I made my fortune... whatever, selling tickets to football games. Well, the opportunity to do those things was lost little by little every time someone bought a ticket. So what do you want? Do you want a centrally managed economy where individuals cannot make purchasing decisions? You do your government-assigned job, you get in line for your government-approved meal, and for entertainment in the afternoon you can attend a play about how great the ruling party is and how everyone must do their part for the good of the nation. There, that's what an economy with no misallocated resources (by the parameters you've set) looks like. No one can incorrectly spend their money because there's no money to spend. The government has complete control.
        gloosx 1y ago
        No one is saying you should be banned from digging holes. The point is: if too much capital keeps flowing into holes instead of hospitals, bridges, or innovation, the economy produces less long-term value. That imbalance is what we call a misallocation of capital. In other words: criticising waste != demanding central planning. It just means recognising that not all spending contributes equally to future prosperity.

by gloosx 1y ago

fluoridation 1y ago

>luxury real estate, yachts, exclusive services, tax havens All of that eventually has to flow back into, as you'd put it, non-elite segments of the economy. What, do you think shipyard workers eat yatchs? There's no subnetwork in the economy where money flows in and never comes back out. That just doesn't exist.

gloosx 1y ago
"money always comes back" view is too simplistic. Value can absolutely be destroyed or locked away: Build a $2M missile -> launch -> it explodes. The workers get wages, sure, but the capital value is literally blown up. No ongoing benefit to the wider economy. Stadiums for Olympics/World Cups -> billions spent -> used for 2 weeks -> abandoned. Money circulates in construction wages, but the asset sits idle, draining maintenance costs. Buy a $450M painting -> store it in a tax-free warehouse -> never seen, never sold for decades. That capital is locked — the flow stops until resale. So yes, wages circulate. But the end product can be waste, destruction, or dead capital. That is the difference between circulation and productive reinvestment.
- fluoridation 1y ago
  >Build a $2M missile -> launch -> it explodes. The workers get wages, sure, but the capital value is literally blown up. No ongoing benefit to the wider economy. >Stadiums for Olympics/World Cups -> billions spent -> used for 2 weeks -> abandoned. Money circulates in construction wages, but the asset sits idle, draining maintenance costs. You have no possible way to quantify the wastefulness of an action. Blowing up a rocket can help prevent more waste. You can feed someone a bowl of soup that makes them sick. With what omniscience do you get to deem a club's expenses wasteful? >Buy a $450M painting -> store it in a tax-free warehouse -> never seen, never sold for decades. That capital is locked — the flow stops until resale. No kidding? The thing you bought stays with you until you sell it? Sorry, how is this different from literally anything else? >But the end product can be waste, destruction, or dead capital. That is the difference between circulation and productive reinvestment. Let's say I'm the richest man in the world, and I use half of my wealth to pay people to dig the biggest, deepest hole possible, and then the other half to fill it back up. I'm sure both you and I will agree that that's a purely wasteful endeavor that would accomplish nothing. Ignoring ecological destruction, who was harmed? What was lost, and who lost it?
  - gloosx 1y ago
    >What was lost, and who lost it? What's lost is opportunity. All that wealth could have gone into projects that produce lasting value: infrastructure, innovation, healthcare. Instead, it was sunk into an activity with no return. Misallocation of capital is a loss measured in foregone progress, society ends up poorer than it could have been, because while we could have had a new hospital or brigde, workers were busy digging some literal shithole. Does it answer your question?
    - fluoridation 1y ago
      >What's lost is opportunity. Surely it's my problem and my problem alone if I want to lose the opportunity to spend my money in something fruitful to instead spend it in something pointless and worthless. >while we could have had a new hospital or brigde Well, no. It was my money I spent. Regardless of what I was going to do with it, building hospitals and bridges was never in the cards. Let's say that I made my fortune... whatever, selling tickets to football games. Well, the opportunity to do those things was lost little by little every time someone bought a ticket. So what do you want? Do you want a centrally managed economy where individuals cannot make purchasing decisions? You do your government-assigned job, you get in line for your government-approved meal, and for entertainment in the afternoon you can attend a play about how great the ruling party is and how everyone must do their part for the good of the nation. There, that's what an economy with no misallocated resources (by the parameters you've set) looks like. No one can incorrectly spend their money because there's no money to spend. The government has complete control.
      - gloosx 1y ago
        No one is saying you should be banned from digging holes. The point is: if too much capital keeps flowing into holes instead of hospitals, bridges, or innovation, the economy produces less long-term value. That imbalance is what we call a misallocation of capital. In other words: criticising waste != demanding central planning. It just means recognising that not all spending contributes equally to future prosperity.