What is Wealth?

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Infinite Karma: Oct 23, 2004; Good as dead

To make the coconut analogy make sense, you have to bring in another element. Whether coconuts represent a store of value, or whether they represent literal food that you're going to eat, most definitions of wealth wouldn't include them.

Wealth would be the coconut palms. The palms are necessary to create the coconuts everyone depends on. If nobody owns them, and everybody just gathers the coconuts that naturally fall, the wealth is being shared. As soon as there aren't more coconuts to go around than can be gathered (i.e. scarcity), people are going to be either rushing to gather them first when they fall (or whatever other method is legitimate to claim them), resulting in violence when people disagree (or in passive violence when the passive people starve to death), or they're going to set down rules for who gets what coconuts as they become available. Those rules are ultimately backed by violence as well. The intangible "right" to a portion of what the palms are growing is Wealth - an exclusionary method of accruing coconuts.

If somebody owns the coconut palms, that's the Capitalist definition of Wealth. They get everything the palms produce. Nobody else can gather those particular coconuts, and that kind of ownership is also backed by violence. People without their own coconut palms would have to make a deal with the palm owners to get access to coconuts. The deal would likely be that the owners get some coconuts without having to gather them on their own, in return for giving access to the palms to the non-Wealthy.

Because coconuts can also be planted to grow new palms, there is a chance to create more Wealth. But they need to be planted somewhere, making land, even empty land, valuable. Since land is scarce, you also need rules to decide who gets to use what land to plant coconut palms. Now land is also a form of Wealth, and its ownership is backed by violence. This is turtles all the way down until all the natural resources are claimed. At which point newcomers into the coconut economy who don't already have Wealth at their disposal are at a big disadvantage in the coconut economy. In order to gain any Wealth at all, they have to get the Wealth, instead of just the coconuts, from the people who currently own it. Violence prevents them from working outside the rules of the coconut economy to gain new Wealth. And the violence of needing to consume food and water and shelter to stay alive prevents them from refusing to participate in the coconut economy if they don't think the rules are fair.

The examples of finding oil in international waters are disingenuous - there are still rules and laws that govern international ownership. There are still "finders keepers" rules where the first one there gets to lay claim to the resources. Trust is just a shortcut to make transactions backed by violence easier. If you break trust, there are fallback rules, and fallback rules for those rules, because violence is only useful as a threat - when you actually carry it out, nothing is gained. But if someone broke trust enough times, the only thing left to do is remove them from the economy with violence, so they can't further harm the good faith actors. Meeting violence with violence, in order to break the rules without consequence, is the only alternative to the rule of "law backed by violence". Which is, you know, violence.

# ¿ Feb 7, 2019 19:23

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# ¿ May 16, 2024 04:42

Infinite Karma: Oct 23, 2004; Good as dead

COMRADES posted:

I think what they are getting at is that land has use value but doesn't in of itself provide anything. People have to farm it / build on it / etc.

Wealth is the ability to command labor, and a nation's wealth is the stream of goods/services it creates. So yeah land just by itself is a raw input more than wealth itself.

Land is wealth because it's all claimed. You can't decide to make your own land from scratch instead of buying it off someone else. So it commands labor by forcing everyone to give someone compensation for using whatever land they want to use.

# ¿ Feb 7, 2019 20:00

Infinite Karma: Oct 23, 2004; Good as dead

Eschat0n posted:

Secondly, when you say "And the violence of needing to consume food and water and shelter to stay alive prevents them from refusing to participate in the coconut economy if they don't think the rules are fair" - I disagree that we can describe the natural state of existence as violence without the word losing its usefulness. It is true that people feel compelled by exigency to participate in economies where they are at a disadvantage - if I'm not mistaken, I'd already brought that up. But it is possible to be "compelled" by forces other than violence. One can feel compelled by compassion, or pity, or hunger, or gravity. Let's not lump all that together under the heading "violence."

Actively taking food away from someone is violence. Putting up a fence that keeps food away from someone (or having a police force that does it) is the same result with extra steps. Ownership is symbolic, not based on if you're literally holding something in your hands. The food sitting in the supermarket is sitting there instead of in your hands because of the threat of violence. There is a very trivial difference between passively withholding something and actively taking something in this consequentialist explanation.

It's not possible to be compelled by compassion or pity, that's nonsense in this argument. Compassion is voluntary, compulsion is not.

quote:

I don't think I'm being disingenuous; at worst perhaps I am ignorant. If you find a super-valuable alien spaceship crashlanded in antarctica and you get your team there first to pull it out (and you do the work of killing the shapeshifting occupants), then in reality when the dust clears, you've got the death ray technology and everyone else can sue you in international court all they want, but you have the wealth. If you grab that oil you found, agents can make claims to it and sue; they can even try to assert naval power, but sometimes the disputing parties really have no physical way of getting there to stop you, and in the time it takes the courts to resolve the issue you'll have built a platform and sucked all that oil up and sold it. Violence didn't really enter into it because it couldn't be applied; you simply had the technical ability to get there and others didn't. It's an edge case, but it can happen. Even if you don't think it happens on earth (it totally does), you can easily see how this could happen if the USA were to make a concerted effort to colonize Mars.

You have the wealth from the spaceship because the court is backed by the threat of violence for not complying. And if you were truly in a lawless place, you have the wealth from the spaceship because you're threatening violence against anyone trying to take it from you. Either way, the only reason you have the spaceship instead of me is violence. It doesn't matter what you got there first, that's an arbitrary rule.

If you lay claim to the oil you find according to the law of the land, and I come and pump it and take it back to my house anyway, that's a physical possibility. But if I'm breaking the laws that are enforced by violence, there will be repercussions for my transgression. If there aren't repercussions (because the law is on my side) AND I didn't have to do violence to get the oil, in what sense did you actually have a claim? If you wanted the oil back, what's stopping you from just taking it back? Violence.

The only way this non-violence edge case example makes sense is if I flew to Mars and did something illegal. And that's because the law literally can't go to Mars to enforce itself.

# ¿ Feb 7, 2019 23:18

Infinite Karma: Oct 23, 2004; Good as dead

Wealth = work is just a bizarre conclusion to draw.

The whole point of wealth (as commonly understood) is that it gives you stuff/value without work. Maybe you had to work for the wealth originally, but wealth functions like a replacement for your own labor after you have it. The difference between wealth and "stored work" is that wealth can generate more work-value than was originally used to create it... so if you're using it correctly, you only ever use the surplus work-value, and never tap into the principal work-value.

# ¿ Feb 12, 2019 17:33

Infinite Karma: Oct 23, 2004; Good as dead

Eschat0n posted:

Certainly wealth can be used to get a certain kind of work done that, for various reasons, you'd rather not/cannot do yourself. Markets exist to facilitate this transaction. But I don't think anyone is going to trade you something that they could get by working for instead, so you're only ever going to get less work out of that agent than the work you put into whatever it is you're offering.

A guy makes hammers. Another guy makes shirts. The guy with the shirt would like a hammer, but he doesn't have any stones, so he's gonna have to get one from the hammer guy. Luckily, he lives in an economy with currency, so he sells some shirts, gets some currency, and buys the hammer. But nobody's buying a shirt off this guy if it costs the same as the work it would take for them to make the shirt themselves; he's going to have to sell to people for whom it would take more work than him to make the shirt. That's fine as far as it goes; these people exist, so he has consumers. But those people bought it with money they got for selling other goods or services; transactions which also were subject to the same considerations. At the base of it, at some point, people are making money by doing work, and the only difference between them doing the work and the person paying them for doing the work is that the person paying could totally do the work themselves, but they just don't want to spend their time that way; though it would take an equivalent amount of time no matter who did it. The only way that kind of agent makes money is by selling their work for less than it is really worth; they're getting screwed (or you could say this is the cost of entry into the currency economy; elsewise those agents would be better off not participating at all - and certainly with people who have no way to really make the most of their time, you see them opt out of economies; that's often seen as criminality in nation-states). And that inequality goes on up the chain of transactions, back to the shirt guy. The hammer is worth more to him than the shirts he sold to get it, sure - he's done less work than if he made the hammer himself - but in order for that to work, someone somewhere had to get screwed.

You keep making up false equivalencies. Why is every transaction a change in ownership? We're all harping on you because rent extracting and rent-seeking is an inevitable part of private property. Instead of buying a hammer, what if the shirt guy just wants to rent one to hang a picture? What if the hammer guy refuses to sell his hammers and ONLY rents them temporarily. Do you not see how that inequality builds itself inherently? To the point where you need to account for it in the model of economics as "work abstraction".

# ¿ Feb 12, 2019 22:05

Infinite Karma: Oct 23, 2004; Good as dead

Liquid Communism posted:

Also, the quote is based on a poor understanding of basic capitalist economics as well.

The sale point for any good isn't 'less than it would cost me to make the shirt myself' it is 'less than the opportunity cost of making the shirt myself', which includes both the cost of manufacture and the time lost to perform that work. It's a minor difference, but very important, because people are more than willing to pay a premium for not having to do a thing they don't want to do, in this case defined as 'making a shirt', so as to spend their time on something more productive or more enjoyable.

That part was just so wrong I didn't know where to start, and ignored it. But thanks for putting it into words.

Nevvy Z posted:

"we are gonna have to exploit somebody" seems to be the thing you are trying to prove but you aren't being very clear about that for some reason and also not proving it very well

Wealth as the ability to decide who gets exploited and to what ends?

It's not controversial to refer to that as "power". Wealth includes the power to make decisions that the less wealthy/powerful don't have available to them.

# ¿ Feb 14, 2019 20:04

Infinite Karma: Oct 23, 2004; Good as dead

The entropy argument is extremely dumb. Technically, entropy increases when you consider a closed system, that's trivial. In reality, the Sun does as astonishing amount of work on the Earth with no input from the Earth at all.

If your consider the Earth anything but an open system receiving ~1000 W/m2 at the surface, for billions of years without fail, you're being insanely pedantic. 99.999% of the biological and chemical energy utilized on the whole planet is a product of capturing solar energy (mostly by plants).

So this thread is really some "Grand unified theory" for basing economics on thermodynamics? Barf.

# ¿ Feb 19, 2019 17:39

Infinite Karma: Oct 23, 2004; Good as dead

Eschat0n posted:

Dumb is not only wrong, but sometimes just simple. It is totally dumb; I've said as much (used the word "trivial" but sure, we can be less nice). But do you disagree?

I think we can use the dumb statement to make less dumb statements further on.

Yes, I disagree. It predicts nothing and describes nothing. On top of being wrong.

# ¿ Feb 19, 2019 18:18

Infinite Karma: Oct 23, 2004; Good as dead

OwlFancier posted:

I would really criticise the entire notion of saying "the economy has a purpose"

It's not some singular thing directed by a singular intelligence, it's the word for an aggregate of a whole bunch of practices that are directed at a functional infinity of different levels and economics as a subject is more trying to observe this thing and understand how it works rather than writing rules for how it prescriptively should work.

Even any sort of aggregate purpose doesn't really work other than broadly "to make money" because the methods by which this is achieved are wildly variable and often at odds with each other.

This feeds into the weird ancap element cos they do more or less literally deify the market and ascribe all good things to its benevolent invisible hand.

If you can ascribe a purpose to the economy at all, it's "to benefit the people picked to be winners by how the laws that govern the economy are intentionally set up." And you can't describe that without politics and sociology and history. You can't call capitalism more efficient than communism or feudalism - it's more efficient at funneling wealth towards the predestined winners under 2019 U.S. law than feudalism is... but wouldn't it be ludicrous to think otherwise? Socialism is more efficient at funneling wealth towards the predestined winners in socialist countries, too (ostensibly the middle class). Soviet communism was very efficient at funneling wealth towards it's predestined winners (the oligarchs/party leaders).

The whole reason we can even have a sensical conversation about this is because we choose the rules of the economy. There is no neutral, natural economy. If we instituted a wealth tax, and punitive capital gains, corporate, and high-income taxes, and gave UBI and Medicare to everyone, we'd "efficiently" pick different winners in the U.S. than we do today.

# ¿ Feb 26, 2019 23:02

Infinite Karma: Oct 23, 2004; Good as dead

It's weird to use the LTV to calculate the value of a bitcoin, because it's almost purely a capital investment. You spend the money on the electricity, and on the machine to mine the bitcoin, and it produces a bitcoin, but the labor involved is essentially "install bitcoin program and then wait," and is a trivial component of the ultimate product. As far as my education goes, you don't consider the labor involved in producing the tools (i.e. the computer and the software) you're utilizing when a third party produces them, you just consider them part of the capital portion.

Bitcoins are one of the worst things to try and apply the LTV to, really, because they're purely a speculative investment, relying on arbitrage to have any value whatsoever. Applying LTV to currency is an oxymoron - currency is only useful for its exchange value, and it's use value is ridiculously low (like melting coins for scrap or burning paper money for warmth). That's the whole point of currency, otherwise we'd just be bartering.

# ¿ Mar 26, 2019 17:53

Infinite Karma: Oct 23, 2004; Good as dead

Helsing posted:

I think this is a pretty severe misunderstanding of Marx's theory. Money, including currency, is a commodity that is produced by socially necessary labour time just like all other commodities.

I recognize that. But is the socially necessary labor time not trivial? Whether money is created automatically in computerized bank deposits, or it's paper on printing presses, the labor time is a tiny, tiny factor. Fiat currency isn't nearly the same thing as other commodities, it's created by fiat, not by labor.

# ¿ Mar 26, 2019 18:24

Infinite Karma: Oct 23, 2004; Good as dead

Typo posted:

you could argue that buttcoins are much closer to being a "physical" commodity like gold than an actual currency

That's an interesting proposition. I guess I see a significant difference because bitcoins can only be traded, not used or improved.

quote:

but then again in Marx's day fiat currency wasn't widespread and everyone was on the gold standard so maybe he sees currency as commodity because for him money = gold + minting under which the labor to produce isn't trivial

That's absolutely the case, IMO. A modern take on LTV needs to account for automation, too, because that pushes hard on the less developed capital side of Marx's understanding of value. In one sense, automated production (or virtual production) is purely a capital expenditure, but in another sense, it's using slave labor (with the automated tools not being compensated for their work). In both senses, the surplus value being extracted is from capital, not really from labor.

I don't think Marx is capable of describing a system where labor has become irrelevant, instead of just being exploited.

# ¿ Mar 26, 2019 19:37

Infinite Karma: Oct 23, 2004; Good as dead

MixMastaTJ posted:

Today, in American society there are people barely scraping by. I, personally, have a decent paying job and a lot of privilege. When I "differ consumption" to stock up on snacks and booze for a party it's my excess compensation at the expense of those less fortunate than me.

But if we're talking I buy one loaf of bread a month instead of two or I skip my weekly hot shower so friends and I can get a six pack... That's masochistic. (But, sure, perfectly ethical.)

But this understanding of saving is rooted in capitalism. Instead of getting a paycheck which you either spend or put in the bank, imagine a warehouse containing all society's goods not being used. You ONLY have control over your own taking from this warehouse, not others. You are entitled to a fair share of the goods, which is based on how many goods there are and how many people we're dividing between. How much you took yesterday is not a factor in what your fair share is.

If you want a soda today whether or not that soda is part of your fair share depends on the availability of soda. Either there is a soda for you or not. Same with a keg of beer for your party. Either we have enough for you to throw your party or we do not.

So, okay, I suppose you can limit your beer consumption in HOPES that we will have enough for a kegger next month, but without controlling other people's consumption that relationship is very abstract.

Maybe taking your daily bottle of beer when there's exactly enough beer produced for everyone to have one bottle and stashing it for your party rather than drinking it could be acceptable, but it stratles the line. Taking something you have no intention to use for the purpose of denying the consumption of others is bad. But I would say denying yourself a beer you would have drunk today would merely be masochistic. (Minorly so, but it's still denying yourself pleasure you have the right to.)

But we're talking about saving itself and using those savings for something that is not unethical. If you saved up your beer to trade for some other good (such as an extra loaf of bread) that's leveraging your capital which is unethical, regardless of how ethically that capital was obtained.

You're not making a good distinction between private property and personal property. Having personal property is perfectly ethical, and some degree of planning, control, and manner of choice in what personal property you prefer is also ethical and completely compatible with other economic systems than capitalism. Not everybody likes beer and not everybody likes wine, so producing what you estimate demand to be, instead of X amount for everyone, is much more practical.

If you knew you wanted a keg of beer next month so you could throw a party, it's stupid to have a society set up where you just show up and hope there's a keg waiting when you want it... and sensible to have some way of either waiting your turn, or trading other luxuries for the luxury beer keg. Commodification of goods is a natural consequence of any economy that has scarcity.

Commodification and savings is really only a problem when it gives unequal access to the means of production. Leveraging "beer power" from your hoarding to get more bread than would be a fair trade might be unethical, but the act of trading one good for another according to your preference isn't. Trading in order to make a profit is the quagmire, because the profit had to come from somewhere, not because of the trade itself.

# ¿ Mar 30, 2019 02:30

Infinite Karma: Oct 23, 2004; Good as dead

Eschat0n posted:

No. What I have now repeatedly said is that in this case the medicine is worse than the ill. Better to simply do nothing about free riders than let unions benefit from mandatory union fees.

This sounds literally insane. Where is this check on rent-seeking against corporations? Oh, right... that's what unions do. Are only laborers forbidden from using market power to benefit themselves?

Unions serve a useful function, and the only way they can meaningfully exist is by taking fees from their members. It's not like unions are getting guaranteed welfare... they have to offer a good enough deal to their members or members don't join (if you're into free market principles). Instead of arguing from trite first principles, look at real life: places where unions exist, laborers have better protections and quality of life. In places where union fees are illegal, unions don't exist at all. The free rider problem isn't trivial, and the mandatory fee abuse is at the very least manageable.

# ¿ Apr 11, 2019 17:56

Infinite Karma: Oct 23, 2004; Good as dead

Eschat0n posted:

Unions absolutely serve a useful function, and yes they must absolutely take fees. but that fee should not be mandatory. That is the position I take.

Do you actually know how unions work?

Unions have collective bargaining power because every employee* (non-management employee) at a particular workplace/company is a member of the union. This is a formal agreement between the company and the union, not just a handshake. If individual employees can opt out, it's not only a violation of that agreement, it defeats the purpose of the union.

So your proposal is what? The members of the union donate money to the union even if they aren't required to? They represent employees for free?

The "position you take" has inconsistencies, that's the point of debate and discussion. Fees being voluntary means unions can't perform their necessary functions - this is backed up be real world evidence in places that ban union fees and those that don't. Is your real position that you care more about banning fees than unions existing? If it is, that's fine. If not, how do you untangle that?

# ¿ Apr 11, 2019 19:17

Infinite Karma: Oct 23, 2004; Good as dead

Eschat0n posted:

You do not understand unions and you show it. Even in areas where mandatory union fees are present, the union does not get its collective bargaining power from the fact that everyone at the workplace is in a union; only most of them. Even in locations with mandatory fees, you do not have to actually be a registered union worker; you just have to pay the fee. So mandatory fees do not guarantee union membership, they only make it highly irrational to not join.

In history and at present, unions operate just fine even in situations where nobody is required to join OR pay. The reason is because unions are logical institutions with real and easily seen benefits; workers rationally should want to join a union if they can. To think that unions can't survive without mandatory fees is tantamount to implying you think people are too loving stupid to enjoy unions - but we KNOW that's not true.

My position is that mandatory fees are unnecessary. IF that actually got rid of unions entirely, I'd change my tune immediately; even unions engaging in regulatory capture are better than no unions at all. I just don't think that's what will actually happen, or has happened in the past.

I managed a multi-state union construction company and worked directly with union and non-union workers. I know what I'm talking about. In California, the unions exist and have power. In Nevada, unions exist and have power. In Arizona, the unions don't, because it's a right-to-work state that outlaws mandatory union fees. Technically, they exist, but they have no bargaining power and are just there to facilitate contractual obligations for multi-state entities. This is because unions have contractual limits on employers' hiring, firing, and compensation practices, which includes preventing companies from hiring non-union employees that compete with union ones.

As logical as unions are, the people that run them are doing work and need to get paid to do it well. If you cut off the funding and make them into charities, they don't bring in enough fees to survive. These are the facts on the ground, do you have examples of unions in right-to-work states/countries to the contrary?

# ¿ Apr 11, 2019 20:27

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# ¿ May 16, 2024 04:42

Infinite Karma: Oct 23, 2004; Good as dead

Also, public sector unions (which aren't bargaining against for-profit employers that get to keep surplus dollars) are very different from private sector unions.

MixMastaTJ posted:

I agree with OP, unions should be state funded.

Not empty quoting

# ¿ Apr 11, 2019 22:06

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