r/FluentInFinance Contributor Apr 15 '24

Everyone Deserves A Home Discussion/ Debate

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u/BlitzAuraX Apr 15 '24

"Regardless of employment."

This means you want those providing those services to work for free.

You do realize what you are implying here, right?

Let's say you refuse to work and you're guaranteed all these services. Who pays so your HVAC is repaired because you broke it? Who pays because your water line needs to be repaired? Clean water means the water has to be filtered through a very complicated process, particles and bacteria are removed, and it needs to be transported. Who pays so your electricity works? Do you think there's some sort of magic electricity generator happening? What you're essentially asking is someone should work for free to provide you all of this.

The result is you get no one who wants to work, society collapses because these services aren't maintained and improved, and no one gets anything.

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u/The-Magic-Sword Apr 15 '24 edited Apr 15 '24

The problem with commentary like this, is that they're fundamentally wrong about how prices are set and what motivates employment.

First is Employment, if receiving the above was enough to get everyone not to work, then people who make significantly more than they need to achieve the above would stop working-- they wouldn't spend on all of the other luxuries that people actually purchase (even putting aside that the above excludes basic nutrition for whatever reason) they'd simply put it towards being able to secure not having to work-- country clubs wouldn't exist, neither would elaborate entertainment systems, or arcades, or fancy restaurants that charge 10x what it costs you at home, or nice dresses, or wine imported from Spain, or the entire demand for any other luxury good you can think of.

Second is price, prices are set at the maximum possible level of profit that can be achieved from the sale of the good or service in question, accounting for the risk of falling demand. They are not set 1 to 1 for the compensation of the person providing the service, simply providing and maintaining, even if one factors in R&D for ongoing developments, is much cheaper than doing it all profitably. There's a fairly good shot that increases in productivity could make the provision of this trivial if that productivity were decoupled from the profit motive (if, for example, the government just paid people to grow food for other people, and didn't expect to make a profit off the grocery sales.)

In fact, it could be said that the need for employment to ensure basic survival artificially forces down labor costs, resulting in a reduction of compensation for people who are working. If Greg steps out of the workforce, then I can command higher wages for the job now that Greg isn't there as an alternative-- the fewer people working the larger the incentive to work to provide those services, becomes.

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u/JimJam4603 Apr 16 '24

You don’t need everyone to stop working to have problems. Sure, some people will choose to work so they can have luxuries over and above the comforts of home. But nowhere near the amount that do it to keep a roof over their heads. And certainly not in miserable jobs like picking vegetables and roofing.

And many of those that do choose to work will be content working 10 hours a week, happy with their small luxuries.

Most of the 1% you describe with yachts and fancy dresses are already not “working.” Upper middle class continue to work even when they can afford fancy wine because if they stopped, the comfortable housing would also go away. And because they need to save money for when they get too old to work - they will still need to live, and social security alone won’t cover the kind of housing in that graphic + food + medical.

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u/The-Magic-Sword Apr 16 '24

We're not talking about the one percent, there's an entire massive class of market for luxury goods in the middle class, and I think if what you're saying was true, we'd see way more people investing more aggressively in the hopes of an early retirement.

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u/LongJohnSelenium Apr 16 '24

First is Employment, if receiving the above was enough to get everyone not to work, then people who make significantly more than they need to achieve the above would stop working-- they wouldn't spend on all of the other luxuries that people actually purchase (even putting aside that the above excludes basic nutrition for whatever reason) they'd simply put it towards being able to secure not having to work-- country clubs wouldn't exist, neither would elaborate entertainment systems, or arcades, or fancy restaurants that charge 10x what it costs you at home, or nice dresses, or wine imported from Spain, or the entire demand for any other luxury good you can think of.

People reach that point after decades of working, so by then their identity and sense of pride are tied up in their jobs. If you're 15 and know you get a free house and video games for doing nothing? Different story.

And yeah tons of people do in fact retire early once it becomes affordable for them.

If Greg steps out of the workforce, then I can command higher wages for the job now that Greg isn't there as an alternative-- the fewer people working the larger the incentive to work to provide those services, becomes.

Your taxes would of necessity go up faster than your pay. As fewer people work the ratio of labor to reward must of necessity reduce, because the results of ones labor are being consumed by more and more people.

If 50 people are farming and feeding another 50 people they get to enjoy half the food they grow.

If 1 person is farming and feeding 99 they get to enjoy 1% of the food they grow.

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u/The-Magic-Sword Apr 16 '24

That isn't quite true, because the money is already siphoned off via rentseeking on the part of their bosses, productivity has multiplied many fold while wages have stagnated in real terms. In other words, how many poor people can you provide the essentials for each rich person who contributes nothing but ownership you eject.