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[Drunken]

I think there is something about modern economics that I am failing to correctly understand. Why is unemployment used as a measure of failure in an economy? We have spent the last century working hard to create a million and one ways to save labour. One farmer feeds 100 times as many people as he did 100 years ago, one clothing worker clothes 1000 times as many. The logical result of all this labour saving technology is that there is less work to be done. The fact that there is currently not much work to be done shows that we have had great success in our endeavours. We should be proud of every jobless person as we clearly aspire to producing more of them. So what is going on?

[Heron TSG]

People who don't work don't get paid and therefore either die or live on welfare, sometimes bringing their families down around them. We want efficiency, but we want the kind of efficiency that means that the same amount of workers get more done, not the kind where less workers get the same amount done.

[Truean]

People who don't work don't get paid and therefore either die or live on welfare, sometimes bringing their families down around them. We want efficiency, but we want the kind of efficiency that means that the same amount of workers get more done, not the kind where less workers get the same amount done.

^^
This.

Also, economics and business are a cycle. If people don't have jobs, who is going to buy all those things businesses make? How would they afford anything? Without customer sales, how will businesses stay open? They don't.

[kaijyuu]

Personally I'd prefer the same amount of workers get the same amount done, but in less time. Advances in technology equating to shorter work weeks would be my ideal.


Remember in the Jetsons how George has a 7 hour work week? I can dream.

[Drunken]

People who don't work don't get paid and therefore either die or live on welfare, sometimes bringing their families down around them. We want efficiency, but we want the kind of efficiency that means that the same amount of workers get more done, not the kind where less workers get the same amount done.

That would be a perfect answer if we had some kind of goal, an epic megaproject in DF parlance. But we don't, so why do we need to get more done? More of what? Under the current system people are saying 'please give me a job, any job, otherwise I will end up dying or being on welfare.' and the economy is saying 'nope, we don't need you'. It is not an intrinsic property of money that it has to be like this. Money is simply a token that represents the resources of society. Given that in western countries we have enough resources for everyone, it is merely a question of distribution. Given that money comes in paper and electronic forms, it is very easy and cheap to distribute. Obviously for those that are currently working producing things that are necessary for society it would be a bit unfair if everyone else was allowed to stop working and they couldn't, but there is a fair solution. We just need to cut down the hours and days people work so that everyone does the same amount, like an hours per year quota you have to fill to keep everything ticking over.

Also, economics and business are a cycle. If people don't have jobs, who is going to buy all those things businesses make? How would they afford anything? Without customer sales, how will businesses stay open? They don't.

It is an unnecessary cycle, the people stop buying those things, the businesses stop producing them, the shops that sell them close, problem solved.

[Drunken]

shops that sell them close, the workers in those shops can't afford to pay for any of the products, so those products stop being produced, more close etc.

you aren't talking about one shop closing, your talking about a multitude, all with janitors, shopkeepers, the guys that restock shelves...

You are confusing two separate problems. The situation you are describing is a problem because of flaws in the system that require people to work to live, without there being any real need for them to work. It is this flaw that is the subject of my question in the first post, ie. why do we do it like that? The other problem once you solve/ignore that system flaw is merely one of distribution, which can be solved trivially as I mentioned already.

[Drunken]

[T]he problem with what you are saying is that we do need to work to live. It's the way this economy works. I can't find any country that runs on the government of anarcho-communism, which is what you are describing.

basically, to get it to work like you suggest, we'd need to do away with currency, and everyone gets equal shares, no?
systems like that work well in a small community, but once it gets large, it begins to suffer a lot of problems.

Not necessarily, we only need to equally divide resources to the point that everyone has the survival minimum. After that (and there is a lot left over) you can go with a capitalist system where the rest is divided in terms of people working to create useless material possessions and buying them off each other. You could also go with a communist system where everything is divided equally as you suggest, but I am not a fan of this personally. Anarchy has nothing to do with it however, what I am suggesting requires a significant amount of administration.

'It's the way this economy works.' My question is, why? What are the advantages of an economy that works like that?

[Newbunkle]

Personally I'd prefer the same amount of workers get the same amount done, but in less time. Advances in technology equating to shorter work weeks would be my ideal.


Remember in the Jetsons how George has a 7 hour work week? I can dream.

^ This, at the very least.

Nobody should have to sit waiting for permission to work in the first place. A free human being - an equal - should be able to use their share of our resources to be economically active without needing to pay anyone for the privilege or letting a self-entitled "employer" leech money off of their work. The overprivileged have a vested interest in getting as few servants doing as much work as possible to maximise what they can scrounge for themselves. This power (their iron grip on our land and resources) should be removed to enable everyone to do business or work together without having to submit to anyone out of desperation.

[Drunken]

Hmm. It seems it is going to have to change. Many many people are jobless and disregarding the natural ebb and flow of economies, this seems to be increasing. I can only see three ways out.

A) Overhaul the economic system,
B) Cease all technological progress,
C) Come up with a giant worldwide epic megaproject for everyone to work on.

For B we might even need to roll it back a bit to get everyone back into work, but not all of it. The internet can stay as that generates many jobs, but labour saving devices would need to go, including many forms of robot. My suggestion for C would be first world infrastructure in every nation, followed by bases on the moon and mars. A and C are not necessarily mutually exclusive, but B makes A redundant and C impossible. Now that I think about it A is probably a necessary prerequisite for C as no one under the current system is going to pay for a megaproject.

[Osmosis Jones]

I don't know what economists you're listening to, but unemployment on macroeconomic scales *isn't* a bad thing. Yes, excessive unemployment is bad, but so is excessive growth, or excessive anything (hence the term excessive).

Unemployment represents a surplus in the labour supply; while it can come about from economic recession (and the individual quanta it represents often won't like it), it is a vital necessity if you want any sort of growth in the absence of efficiency improvements. If there is too little unemployment, wages skyrocket as employers try to headhunt employees (which has a pronounced inflationary effect), while actual growth of the economy (which can conteract the inflationary pressure) is stymied.

The more likely reason that it is *perceived* as bad is because of the conflation of micro- and macro-economics; people think of unemployment as a poor factory worker starving and unable to feed his family, not as the freshly graduated batch of engineers/chemists/metallurgists/etc that a new mining company can hire to expand its smelting operation.

Of course, even this is a gross oversimplification, ignoring things like structural vs. frictional employment, and so forth.

[kaijyuu]

Not necessarily, we only need to equally divide resources to the point that everyone has the survival minimum. After that (and there is a lot left over) you can go with a capitalist system where the rest is divided in terms of people working to create useless material possessions and buying them off each other.

I've been advocating this for years, but it's not simple to implement and may not even be possible right now.


1) The bare necessities to live entails quite a lot. Nowadays, that includes food, shelter, clean water, heathcare, and probably transportation. That's a lot to give for free.
2) If we do give it for free, we need to be ensured that those services are being provided, and provided well. We don't want bread lines.
3) Production and proper distribution of those necessities means jobs exist that NEED to be done. If they're not done, the system collapses.
4) As the bare necessities are being provided, it is no longer a necessity to work, creating a potential problem with #3.
5) There are cultural barriers, such as the notion that people who don't work don't deserve to live. Yes, there exist people who believe that, and not in few numbers.


A lot needs to happen to get past all those problems.

[Drunken]

Thanks for the clarification but I am still not completely clear on the whole thing. My main question from your post is regarding this:

it is a vital necessity if you want any sort of growth in the absence of efficiency improvements

Growth in an economic sense usually means more stuff being produced and consumed (correct me if I am wrong). Why do we need this? We have grown to the point where we are now bigger than we need to be. Is there a pressing reason we can't just stop growing, at least for a while?

Oh and wrt what economists I'm listening to: the ones on TV, but don't worry I know they are mostly idiots. Still there is a general public perception of economics which is based on what the media tells them. I don't think economics are as complex as they are made out to be. Sure economies are extremely complex, but in the sense that brownian motion or music is complex: the underlying principles are fairly straightforward. Having said that, I am supremely confused about the aspects mentioned in this thread so perhaps it really is bigger than I thought.

[Osmosis Jones]

Nobody should have to sit waiting for permission to work in the first place. A free human being - an equal - should be able to use their share of our resources to be economically active without needing to pay anyone for the privilege or letting a self-entitled "employer" leech money off of their work. The overprivileged have a vested interest in getting as few servants doing as much work as possible to maximise what they can scrounge for themselves. This power (their iron grip on our land and resources) should be removed to enable everyone to do business or work together without having to submit to anyone out of desperation.

Yes, everyone should be entitled to a fair share, but how do you measure that? How do you compare the value of low skill but physically intensive menial labour with high skill, yet non-physically taxing medical job? What about abstract maths? Philosophy? Art? Innovation and investment (yes that is actually a valuable skill, despite how much people hate fatcats)?

Yes, the rich elite having huge power and influence is a terrible thing, but it is not a trivial problem to solve. Let them have free reign, and you end up like the states; consolidating power and wealth in small oligarchies. But what? Take their wealth out of hand, and you lose the ability to motivate people towards a personal reward (why would I work my arse off, if the government will just reposess everything later?).

These are obvious cases, but there are thousands more.

The problem is, economies aren't simple. You can't just wave a magic wand and make it better.

Ninja'd; Kaijyuu hits on some of these points himself.

Thanks for the clarification but I am still not completely clear on the whole thing. My main question from your post is regarding this:

it is a vital necessity if you want any sort of growth in the absence of efficiency improvements

Growth in an economic sense usually means more stuff being produced and consumed (correct me if I am wrong). Why do we need this? We have grown to the point where we are now bigger than we need to be. Is there a pressing reason we can't just stop growing, at least for a while?

Oh and wrt what economists I'm listening to: the ones on TV, but don't worry I know they are mostly idiots. Still there is a general public perception of economics which is based on what the media tells them. I don't think economics are as complex as they are made out to be. Sure economies are extremely complex, but in the sense that brownian motion or music is complex: the underlying principles are fairly straightforward. Having said that, I am supremely confused about the aspects mentioned in this thread so perhaps it really is bigger than I thought.

Endless growth isn't desirable, in theory, because of the whole finite resources thing. However, in practice, it's a little different; short term (controlled; again, excessive is BAD) growth has it's advantages. One example; if an economy is static, basically the only way you can advance is by retirement or death of those above you. That means almost no social mobility. That's fine if you're on the top, but not so good if you're on the bottom and have dreams beyond shovelling shit.

Furthermore, it depends on population; economic growth is intrinsically linked to population growth. If there's population growth but no economic growth; there will be an impoverished class growing at the same rate. As our population has pretty well always been expanding (thanks SCIENCE!), our economy has needed to as well. When population starts to level off, we should see a cooling of passion for economic growth

Also, yeah, popular media is generally a terrible way to get a clear picture of any issue. Sadly though, there isn't any better way other then reading up on every subject personally.

EDIT: Oh and look up fractals. Extreme complexity can come from VERY simple rules. EDIT EDIT: Also, yes, there are simple rules for music, but I would never dream of being able to understand it all. Brownian motion, though, is fairly straightforward. Not necessarily trivial, but comprehensible.

[malloc]

Unemployment is never a good thing.

There are two reasons for this.
The first reason is social. Long term unemployment is not good for human psyche, work doesn't just reward you with financial gains, it often does stimulate your socials needs as well. I know a lot of people hate who or where they work, it's stimulating on a more basic level, it's more of a way to break up the day, you learn to appreciative time, and you expose yourself to something different.

The second reason, it's not good for the economy. First of all, people who are unemployed still cost money. Not just in upkeep, but also in the sense that they are lost workforce. This is many times higher than just the cost of upkeep. Unemployed people are not contributing to society either, the world does not need more useless people, it's hard enough to keep up standards as it is.

On the other hand, that a country can afford a high unemployment rate means that the country has a good economy. But believe me, it's not something any country can keep up for long and it does not have to. Market forces mean that high unemployment rates are, for the most part, temporary.



Also, never say we don't have a goal. We DO have a goal, the goal is to get an even better economy. Because, better economy means more progress, and more progress eventually means jetpacks, and everyone knows that jetpacks are awesome.

[hawkeye_de]

Difficult topic.

In Germany we have the discussion about the 'Bürgergeld' for a long time and the CEO of the biggest drugstore franchise here is a strong promoter of this idea.
The proposed 'Bürgergeld' is a kind of unconditional unemployment welfare system...that is you do not have to proof that you are seeking a job. The income of that welfare system should be of such a dimension that you can buy food, pay your basic bills (energy, transportation etc.) and can participate in social life but of crs only the very basic things.
The needed money for this system should be gained by a higher value tax.

The idea behind is that everybody can have a break from his job, study, do what he wants to do...change his life...at least a couple of years.

The problem behind is that the thesis of this CEO is that everybody has a goal in his life, which more or less also has benefits for the whole society. If somebody has not a goal/will he claims that this person would be ill (for example has a depression) and should be treated accordingly.

Partly this assumption is surely correct...a lot of people have depressions because they are unhappy with their job, in which they spend most of their time. But unfortunately there are also a lot of lazy people out there, who just seek somebody who pays their bills so that they can have an easy life.
Nevertheless, I think it is worth to really do a professional evaluation of this model and pick out the working things.

In general, I think the Western working model has to change. As already described in this thread, we have more and more automation in our life, in factories, literally everywhere. But there are more and more people who cannot cope with those high requirements...in the past they have usually have found a more or less 'good' job, where they could use their 'practical' skills or even just their strength and physical endurance. The problem nowadays is, that even if they find such a job, they get barely enough money to pay their bills - not speaking about other consuming goods.

Secondly (most) of the human beings seek for at least some level of security in their life...also financial security...that's the reason why insurance companies have such an incredible success. Now, even high-tech jobs will be outsourced (I've read that Microsoft/IBM plan this)...that is a  lot of project members are not a member of the company anymore but have to compete for each and every project with literally 'all' similar-qualified guys over the globe. I do not say that this model not also generate new chances (especially for the countries, who are not so developed, yet) but it may raise further risks in your life and produce stress (do I get a new job after the project is finished, can I pay the interest rates for my house and so on).

I think part of the solution is that we reduce our working time(and do not earn so much money anymore - at least for the well paid jobs)...so that more people can actually work on the same job. Sure this will make products in the end a little more expensive and there might be some competition lost...but it maybe worth that risk, since - do we work to get every year a new iPhone/iPad or do we want have time to do creative things (like creating Dwarf Fortress )?

At least everybody should have a chance to reduce his working time and it should be accepted by society...I think in the Netherlands that is already quite common.