4 ms·

If you were to count the margin of everything it would be 100%. At the end of the day everything is either a resource harvested from the earth or human labor.

sssilver 2mo ago
Help me understand this. There's the cost that the employees pocket, and then there's the share that the shareholders pocket, right? Doesn't "margin" represent the latter?
- abtinf 2mo ago
  100% of the money ends up going to people. It’s not like you get to the end of the chain and trade a fistful of dollars with the ingot of aluminum itself.
  - sssilver 2mo ago
    Sure, the concept of money is only meaningful / valuable to humans. But isn't there a conceptual difference between the "owners" of the Tomahawk factory vs. the people who are actually putting the missiles together?
    - abtinf 2mo ago
      Of course, but it’s not so clear in terms of the question you asked, and certainly not in terms of government procurement. Those workers are often organized and unionized. They exert tremendous political influence to, say, require the factories to employ unionized labor and extract above market wages. Surely the differential between union and market wage should factor into your margin calculation? The factory owners are only too happy to oblige. If you have a cost-plus contract with the government (so a contract that guarantees a certain margin), then the only way to get more absolute profit is to have higher costs. Defense procurement is best thought of as being totally price insensitive. In fact, almost everyone in the chain benefits from higher costs: the workers, the suppliers, the corporations, the military leadership, the politicians, and their constituents. The only people hurt are those future casualties of a less capable national defense, mainly soldiers.
abtinf 2mo ago
Everything is human labor. There is no such thing as a “resource” without human labor to convert raw earth into something useful.
- GavinMcG 2mo ago
  Two things that are necessary are both necessary. That doesn’t mean one collapses into the other.
- williamcotton 2mo ago
  IP at the margin?
- wolfgangK 2mo ago
  Everything is food and air. There is no such thing a "human labor" without food and air to sustain it. I'm not sure what your point is.
sgc 2mo ago
The more common concept of margin used in this context is net profit after expenses, including labor expenses. The question is therefore roughly "How much is purely for capital profit taking rather than directly involved with compensating labor and purchasing materials?".

sssilver 2mo ago

Help me understand this. There's the cost that the employees pocket, and then there's the share that the shareholders pocket, right? Doesn't "margin" represent the latter?

abtinf 2mo ago
100% of the money ends up going to people. It’s not like you get to the end of the chain and trade a fistful of dollars with the ingot of aluminum itself.
- sssilver 2mo ago
  Sure, the concept of money is only meaningful / valuable to humans. But isn't there a conceptual difference between the "owners" of the Tomahawk factory vs. the people who are actually putting the missiles together?
  - abtinf 2mo ago
    Of course, but it’s not so clear in terms of the question you asked, and certainly not in terms of government procurement. Those workers are often organized and unionized. They exert tremendous political influence to, say, require the factories to employ unionized labor and extract above market wages. Surely the differential between union and market wage should factor into your margin calculation? The factory owners are only too happy to oblige. If you have a cost-plus contract with the government (so a contract that guarantees a certain margin), then the only way to get more absolute profit is to have higher costs. Defense procurement is best thought of as being totally price insensitive. In fact, almost everyone in the chain benefits from higher costs: the workers, the suppliers, the corporations, the military leadership, the politicians, and their constituents. The only people hurt are those future casualties of a less capable national defense, mainly soldiers.

abtinf 2mo ago

Everything is human labor. There is no such thing as a “resource” without human labor to convert raw earth into something useful.

GavinMcG 2mo ago
Two things that are necessary are both necessary. That doesn’t mean one collapses into the other.
williamcotton 2mo ago
IP at the margin?
wolfgangK 2mo ago
Everything is food and air. There is no such thing a "human labor" without food and air to sustain it. I'm not sure what your point is.

sgc 2mo ago

The more common concept of margin used in this context is net profit after expenses, including labor expenses. The question is therefore roughly "How much is purely for capital profit taking rather than directly involved with compensating labor and purchasing materials?".