What the left gets wrong about economics that annoys the shit out of me

[Berkut]

I can guarantee you that the solution to climate change is at least partly going to be "consume less stuff" which likely leads to producing less stuff as well.

And you seem to have a lot of faith in trickle down (if rich people get more then poor people also get more), and in a country's wealth correlating to the quality of its social spending. As it happens, the wealthiest countries like the US or China have significantly worse social programs than comparatively poorer European countries.

This is not "trickle down", at least not in the iditioc way the right thinks about it. It is the case that if we produce more stuff, more of that stuff makes it way through society. That is not theory - it is a fact, and not one that is in dispute, so far as I am aware.

Obviously there are various level of social spending among like wealthy countries, again - not in dispute.

Two countries that both have roughly equivalent per capita GDP can of course choose to spend differing amount on social spending. And that means that there will be cases where some countries simply choose to spend less. But that doesn't mean that increasing GDP even for those that choose to spend less, will not increase wealth for the poor - it will just increase less.

And this is a good argument to have, and one we SHOULD have! It is, I contend, the very fundamental argument liberal free market economies ought to be having. Should we spend 23% like the US, or 30%, like France?

In either case, the argument should not be "Lets produce less!" or to forget that whether we dedicate 22% or 30%, increasing the total amount will in fact increase amount in actual spend spent for those who need help, AND increasing the amount per capita will do the same.

That is not faith in "trickle down" that is just basic freaking math.

[Berkut]

I can guarantee you that the solution to climate change is at least partly going to be "consume less stuff" which likely leads to producing less stuff as well.

I think the solution will include producing less particular stuff. Like coal power. But it will be because we transition to producing some other stuff to replace it.

I would be willing to bet my entire salary that the only way actual human production in aggregate ever declines is some catastrophe. It will never happen voluntarily. That catastrophe could very well be mis-managing the climate crisis.

[Josquius]

Define stuff.
Producing less stuff is definitely the way to fix climate change and the way to becoming richer- the knowledge economy being far more profitable than churning out tonnes of plastic tat.

The big problem in the world today that again wasn't foreseen by Marx and co with the idea that produce more=be richer is that our capacity to manufacture has drastically outstripped our capacity to consume.
No longer is manufacturing capacity the limiting factor in growth, rather its consumption capacity.

With the rise in increased automation, 3D printing, etc... I really can see 'making more stuff' in the physical sense completely falling off the radar of things countries aim for. Having raw materials is still important, designing is more important than ever, the actual manufacturing....ever more less so.

Hell. There are many circumstances in which producing less makes perfect business sense. The Chinese method of mass cheap manufacture is only one way, there's also for instance the Swiss watch industry which makes a fortune producing in very limited qualities.
I really do hope we move away from our current system which is leaning heavily towards the Chinese way of buying a £5 t-shirt every year and throwing it away and more towards paying more for better quality stuff that lasts you longer. Its win-win-win all round.

And lets not even consider the sheer amount of stuff produced in vain which is never sold and is simply thrown away as waste. Cutting back on waste is a area where environmentalists and kaizen obsessed capitalists are really in alignment. This too comes down to make less stuff.

For your point on the crazy left and Brazil burning down the forest- eh? Aren't the left proposing exactly what you're talking about, putting in place incentives for Brazil to keep the forest? One proposal I recall hearing not too long ago was very literally to just pay Brazil to rent the forest and leave it intact.

[The Minsky Moment]

I can guarantee you that the solution to climate change is at least partly going to be "consume less stuff" which likely leads to producing less stuff as well.

There are a lot of potential solutions to human driven climate change.  I suppose the only true sure-fired guaranteed way is to eradicate all humans.  That would definitely put an end to human-cause climate change.

Of course there are many ways short of total eradication of human presence on earth that can be effective.  For example, altering modes of production of energy, transportation, goods and services such that there is no net input of carbon into the atmosphere.  That does not require or imply an overall reduction in the quantity of goods and services produced.

[Berkut]

Define stuff.
Producing less stuff is definitely the way to fix climate change and the way to becoming richer- the knowledge economy being far more profitable than churning out tonnes of plastic tat.

The big problem in the world today that again wasn't foreseen by Marx and co with the idea that produce more=be richer is that our capacity to manufacture has drastically outstripped our capacity to consume.
No longer is manufacturing capacity the limiting factor in growth, rather its consumption capacity.

With the rise in increased automation, 3D printing, etc... I really can see 'making more stuff' in the physical sense completely falling off the radar of things countries aim for. Having raw materials is still important, designing is more important than ever, the actual manufacturing....ever more less so.

Hell. There are many circumstances in which producing less makes perfect business sense. The Chinese method of mass cheap manufacture is only one way, there's also for instance the Swiss watch industry which makes loads producing in very limited qualities.
I really do hope we move away from our current system which is leaning heavily towards the Chinese way of buying a £5 t-shirt every year and throwing it away and more towards paying more for better quality stuff that lasts you longer. Its win-win-win all round.

And lets not even consider the sheer amount of stuff produced in vain which is never sold and is simply thrown away as waste. Cutting back on waste is a area where environmentalists and kaizen obsessed capitalists are really in alignment. This too comes down to make less stuff.

For your point on the crazy left and Brazil burning down the forest- eh? Aren't the left proposing exactly what you're talking about, putting in place incentives for Brazil to keep the forest? One proposal I recall hearing not too long ago was very literally to just pay Brazil to rent the forest and leave it intact.

Gross product.

Yes, we certainly can produce less specific items. Some items we used to produce we do not produce at all anymore.

And yes, in the specific, it makes perfect sense to get out of the horseshoe making business.

And in fact, the "thing" that has the key effect on efficiently deciding what specific items ought to be produced, and what ought not be produced, is that ever despised free market that determines how the stuff is priced, and hence what stuff ought to be made.

Stuff is not necessarily physical. I don't produce anything physical myself in my job, I manage software creation. It is still stuff.

[Berkut]

For your point on the crazy left and Brazil burning down the forest- eh? Aren't the left proposing exactly what you're talking about, putting in place incentives for Brazil to keep the forest? One proposal I recall hearing not too long ago was very literally to just pay Brazil to rent the forest and leave it intact.

Perhaps my meaning overall was not clear.

This is not things that every person on the left gets wrong by any means - it is things that SOME people on the left get wrong.

It's like talking about identity politics and cancel culture. Obviously not everyone is all for allowing the mob to shout down opinions it doesn't like. But some are...and when we talk about that being a problem in the left, it is talking about those who promote that particular attitude.

More broadly speaking (and I think this thread illustrates it well) there are plenty on the left who really seem to hate data and facts, because it gets in the way of their narrative of the Evil Corporations and Capitalists ruining the world and exploiting the downtrodden who cannot catch a break.

Look at Zoupa - his response to being shown data that shows what he thought was true was wrong was to tell me I should go hang out in a soup kitchen. It's funny, if I told garbon to go learn something about black people, I would be rightly vilified and ostracized. But Zoupa can lecture someone who almost certainly has experienced much, much worse poverty then he has* and it goes without comment. But that is a different problem.


*Of course I don't know if he has or not, since I don't know his background. But statistically, it is pretty damn unlikely he has - of course, I would never condescend to lecture him on it either way, since I don't know his personal experience.

[Josquius]

Stuff is not necessarily physical. I don't produce anything physical myself in my job, I manage software creation. It is still stuff.

Fair enough if thats how you're defining it. You won't find many on the left who are opposed to producing more in this sense though. When you see talk of cutting back and producing left it tends to be very much with an eye on the physical.

And in fact, the "thing" that has the key effect on efficiently deciding what specific items ought to be produced, and what ought not be produced, is that ever despised free market that determines how the stuff is priced, and hence what stuff ought to be made.

Yes. However it is flawed. By nature of the free market you'll get loads of companies chasing the lucrative widget market and churning out 10,000 widgets for a possible market of only 1,000.
With time will the market adjust to eliminate this over production, but the less talented manufacturers out of business, etc....? Sure.
But in the meantime there's so many resources that have just gone to waste in pursuing this goal that the market has dictated is the most lucrative.
Meanwhile there might be a far less lucrative market in producing gizmos which is poorly served as the maths just don't make business sense (and it has already hit the upper limit of what prices could feasibly rise to) despite the fact that these gizmos could be necessary for e.g. disabled people to have a decent  quality of life. This is where government might come in with various incentives to guide the market in a useful direction.

This is particularly useful in the modern world in the digital sphere where a few people with an idea really can come up with something big. In a land where the market is left to itself however few will be brave enough to try this even if they think they have a decent idea. Only the rich can innovate whilst somebody who is really smart but from a working class background might decide to keep working his high paying 9 to 5 in the code-mill is the best option. Create a decent social safety net however and you can maximise the innovative potential of your population. People won't feel quite so scared of striking out and trying to start a business. 
Hell. At the core level even just getting this smart working class kid into a position where he learns these skills can be tough in a libertarian wonderland. He wouldn't have gone to a good school. He wouldn't have been able to concentrate in class. He might never even realise the thing he becomes a genius in exists.
Yes yes there are plenty of exceptions out there of people from crap backgrounds who overcame adversity to succeed. But these are vastly outnumbered, especially in proportion to the population as a whole, by those from wealthy backgrounds doing the same. This 'Digital is overwhelmingly dominated by rich white guys' thing is a genuine problem in the industry that means a lot of talent is lost.

The market as fire analogy is strong.

More broadly speaking (and I think this thread illustrates it well) there are plenty on the left who really seem to hate data and facts, because it gets in the way of their narrative of the Evil Corporations and Capitalists ruining the world and exploiting the downtrodden who cannot catch a break.

Again... wut?
This is far more common on the right I find.
The left is the politics of data, of science. The right is the politics of emotion.
This has long been a key criticism the right has aimed at the left in fact. That amidst their devotion to rationality they can forget the human.

Look at Zoupa - his response to being shown data that shows what he thought was true was wrong was to tell me I should go hang out in a soup kitchen. It's funny, if I told garbon to go learn something about black people, I would be rightly vilified and ostracized. But Zoupa can lecture someone who almost certainly has experienced much, much worse poverty then he has* and it goes without comment. But that is a different problem.

I don't think its the fact that poverty is less of an issue than it has been in other times and places that he found objectionable. Rather the insinuation that this somehow matters.
Is poverty in the US lower than in the past? Sure. I believe it.
But could it be lower with a more empathetic government that actually paid attention to the situation and did something to try and fix it? Almost certainly. Just compare the data with other countries.

[Berkut]

Stuff is not necessarily physical. I don't produce anything physical myself in my job, I manage software creation. It is still stuff.

Fair enough if thats how you're defining it. You won't find many on the left who are opposed to producing more in this sense though. When you see talk of cutting back and producing left it tends to be very much with an eye on the physical.

And in fact, the "thing" that has the key effect on efficiently deciding what specific items ought to be produced, and what ought not be produced, is that ever despised free market that determines how the stuff is priced, and hence what stuff ought to be made.

Yes. However it is flawed. By nature of the free market you'll get loads of companies chasing the lucrative widget market and churning out 10,000 widgets for a possible market of only 1,000.
With time will the market adjust to eliminate this over production, but the less talented manufacturers out of business, etc....? Sure.
But in the meantime there's so many resources that have just gone to waste in pursuing this goal that the market has dictated is the most lucrative.

That....that is not how a market works.

The nature of the free market does NOT gets loads of companies chasing a "lucrative" market that then magically turns out to not be lucrative.

It just...I don't even know where to begin on how you either don't understand how a market works, or maybe are just articulating it poorly.

[Berkut]

I don't think its the fact that poverty is less of an issue than it has been in other times and places that he found objectionable. Rather the insinuation that this somehow matters.
Is poverty in the US lower than in the past? Sure. I believe it.
But could it be lower with a more empathetic government that actually paid attention to the situation and did something to try and fix it? Almost certainly. Just compare the data with other countries.

The insinuation that it doesn't matter IS the problem!

If you concede that poverty is a much, much, MUCH smaller problem (and it is) but you want to make it even smaller....then wouldn't it be pretty damn critical to

A) Recognize that the problem has declined massively, and
B) Understand WHY it has done that, so

C) You can best figure out how to continue doing what is working already so as to make the problem even smaller?

[Josquius]

That....that is not how a market works.

The nature of the free market does NOT gets loads of companies chasing a "lucrative" market that then magically turns out to not be lucrative.

It just...I don't even know where to begin on how you either don't understand how a market works, or maybe are just articulating it poorly.

Sure it is. It happens all the time.
Its pretty standard with new markets that you tend to have a bunch of companies challenging to be the one dominating it at first and steadily some fail.
Its not so much that the market which seems lucrative turns out not to be (though this happens too), rather that there's only a certain size of market available and far more stuff produced to fill it than there are slots. This isn't a static number of course, it can rise and fall based on various factors, but that companies can fail to get a significant slice of a market is pretty standard.

The insinuation that it doesn't matter IS the problem!

If you concede that poverty is a much, much, MUCH smaller problem (and it is) but you want to make it even smaller....then wouldn't it be pretty damn critical to

A) Recognize that the problem has declined massively, and
B) Understand WHY it has done that, so

C) You can best figure out how to continue doing what is working already so as to make the problem even smaller?

The problem here is correlation doesn't equal causation.
Until Obama the US had always had white guys for president. The US had risen from a peripheral part of the world to a global superpower. Does that mean voting  for someone who isn't a white guy is an error?

A silly example of course but this can be seen even in data points where there might be more believable links. Sticking on the race thing here for some reason but one I have seen is right wingers boasting about how the cities in the US with the highest crime rate also tend to have the highest black population.
Nobody is doubting that this is a fact.
But their insinuation that this is definitely due to black people being natural criminals.... well no.

Also important to consider when analysing data is that even where you can be sure there is a correlation between two factors this doesn't necessarily mean that this factor is definitely the best way to go. For instance if you're designing an application and you notice making the menu button bigger definitely leads to more people clicking the menu button and ultimately to an uptick in conversions.... This doesn't necessarily mean doing away with the menu and having search functionality might not be an even better way to get better results for your goal.

The thing is with this poverty example we see pretty striking evidence that countries with effective social systems have far less of an issue with this than do countries where liberalism runs rampant.

[crazy canuck]

And plenty of people argue against free markets and capitalism. Not all progressives by any means - but look at the rhetoric out of Robert Reich and the continual cries about the evils of capitalism in general.

Free markets and capitalism are not the same thing, incidentally. I don't think anyone is arguing against (regulated) free markets, but capitalism clearly has a bunch of problems that have been especially visible in the recent couple of decades (e.g. placing shareholder value above any other considerations, ignoring climate change, etc.), and it's perfectly valid to argue against it.

It's perfectly valid to argue against the things about capitalism that you mention, and one can even argue that doing so is actually arguing IN FAVOR of better capitalism - a capitalism that actually captures and considers all the costs of doing business, rather then just some of them.

But arguing that capitalism itself is the problem is, well....idiotic. It is the very thing that has gotten us to a place where so many of the defining problems of humanity that the left is supposed to be motivated to improve are in fact at their very lowest points, and dramatically so.

Your argument, to me anyway, is like saying "Cars are the worst ever! We should get rid of them and we would all be better off!" in like 1950. Then when someone points out how great cars are, and wonders what alternative to them you are proposing, you say "Well, people get killed all the time when they crash and the brakes don't work well!". Well, lets get seatbelts and better testing and crumple zones and better designed highways. All of which we did, and now people dying in cars is certainly still a problem, but it happens at somethiing like 1/20th the rate it did then.

Capitalism is not the very thing that has improved the human condition.  You have gone from data which says the human condition has improved, to a very problematic conclusion for the cause of that happening.

Without the New Deal capitalism in the US would have imploded on itself.  You delude yourself when you ignore all the benefits of government intervention, support and regulation along the way.

[crazy canuck]

Stuff is not necessarily physical. I don't produce anything physical myself in my job, I manage software creation. It is still stuff.

Fair enough if thats how you're defining it. You won't find many on the left who are opposed to producing more in this sense though. When you see talk of cutting back and producing left it tends to be very much with an eye on the physical.

And in fact, the "thing" that has the key effect on efficiently deciding what specific items ought to be produced, and what ought not be produced, is that ever despised free market that determines how the stuff is priced, and hence what stuff ought to be made.

Yes. However it is flawed. By nature of the free market you'll get loads of companies chasing the lucrative widget market and churning out 10,000 widgets for a possible market of only 1,000.
With time will the market adjust to eliminate this over production, but the less talented manufacturers out of business, etc....? Sure.
But in the meantime there's so many resources that have just gone to waste in pursuing this goal that the market has dictated is the most lucrative.

That....that is not how a market works.

The nature of the free market does NOT gets loads of companies chasing a "lucrative" market that then magically turns out to not be lucrative.

It just...I don't even know where to begin on how you either don't understand how a market works, or maybe are just articulating it poorly.

And you have an overly simplistic view bred by years of absorbing the rhetoric of the US right.

[grumbler]

I can guarantee you that the solution to climate change is at least partly going to be "consume less stuff" which likely leads to producing less stuff as well.

I think the solution will include producing less particular stuff. Like coal power. But it will be because we transition to producing some other stuff to replace it.

I would be willing to bet my entire salary that the only way actual human production in aggregate ever declines is some catastrophe. It will never happen voluntarily. That catastrophe could very well be mis-managing the climate crisis.

I agree.  The change will be "consume different stuff" but Solmyr's guarantee that the solution will be "consume less stuff" will bankrupt him if he puts money behind his "guarantees."

[grumbler]

Sure it is. It happens all the time.
Its pretty standard with new markets that you tend to have a bunch of companies challenging to be the one dominating it at first and steadily some fail.
Its not so much that the market which seems lucrative turns out not to be (though this happens too), rather that there's only a certain size of market available and far more stuff produced to fill it than there are slots. This isn't a static number of course, it can rise and fall based on various factors, but that companies can fail to get a significant slice of a market is pretty standard.

The size of the market depends on the price of the good.  If there are more goods than can be sold at a given price, firms will lower prices to get rid of inventory.  This is basic economics, which some extremists on the left and the right appear to reject because it ruins their absurd theories.  Companies can tinker a bit with market-clearing price on the edges by advertising and the like, but price overwhelmingly dominates demand.

Companies fail to get a slice of the market when their costs are too high compared to the market-clearing price.

[Zoupa]

For your point on the crazy left and Brazil burning down the forest- eh? Aren't the left proposing exactly what you're talking about, putting in place incentives for Brazil to keep the forest? One proposal I recall hearing not too long ago was very literally to just pay Brazil to rent the forest and leave it intact.

Perhaps my meaning overall was not clear.

This is not things that every person on the left gets wrong by any means - it is things that SOME people on the left get wrong.

It's like talking about identity politics and cancel culture. Obviously not everyone is all for allowing the mob to shout down opinions it doesn't like. But some are...and when we talk about that being a problem in the left, it is talking about those who promote that particular attitude.

More broadly speaking (and I think this thread illustrates it well) there are plenty on the left who really seem to hate data and facts, because it gets in the way of their narrative of the Evil Corporations and Capitalists ruining the world and exploiting the downtrodden who cannot catch a break.

Look at Zoupa - his response to being shown data that shows what he thought was true was wrong was to tell me I should go hang out in a soup kitchen. It's funny, if I told garbon to go learn something about black people, I would be rightly vilified and ostracized. But Zoupa can lecture someone who almost certainly has experienced much, much worse poverty then he has* and it goes without comment. But that is a different problem.


*Of course I don't know if he has or not, since I don't know his background. But statistically, it is pretty damn unlikely he has - of course, I would never condescend to lecture him on it either way, since I don't know his personal experience.

You have not taught me anything in this thread. Can you point to the data that I thought was true, and that your post demonstrated was false?

You keep putting words in people's mouths and deciding what they know/feel/think, especially when someone pushes back on your wise words.

Please point to a poster or a prominent influence of the "left" that actually said the stuff you said they said, like "abolish capitalism" or "ban cars". Take your time.