On Fri, Jul 25, 2003 at 01:25:16AM -0400, John Pedersen wrote:
> Paul M Foster wrote:
> >On Thu, Jul 24, 2003 at 08:22:29PM -0400, John Pedersen wrote:
> >
<snip>
>
> We're not assessing transactions--we're talking about the ACTIVITY of
> manufacturing something, vs the activity of performing a service.
>
> After I spend 8 hours making a table, I will have changed the NET
> wealth of the entire nation by $900. But after the dentist does his
> job on you, the net wealth remains unchanged.
<snip>
> Ok, I'll try one more time. Suppose, at some instant in time, I own
> $800 worth of materials for table-making. Now FREEZE the entire
> nation--everybody mark time while I go to work for one hour. After I
> made my table, EVERYBODY ELSE in the entire nation has EXACTLY the
> same assets that they had before, but I have a $1000 table, instead of
> $800 worth of materials. NOTE!!!!!! NOBODY, NOBODY in the entire
> nation had to get any poorer in order for me to become $200 richer.
>
> Now compare to the case where somebody performs a service. Like your
> travel agent that puts together an $800 package. Sure, he can make
> $200, BUT ONLY WHEN SOMEBODY ELSE GETS $200 poorer!!!! (In other
> words, somebody pays $1000 for the service + $800 package.) NET, in
> the nation, no change.
Well, every time we come up with examples, the points of reference
shift. I don't see how it's possible to reconcile these views under the
circumstances. My understanding of basic economics says that wealth is
simply the accumulation of value. And that value is derived from the
exchange of goods _and_ services. Without such exchange, all value is
only potential value. And both parties derive value from the exchange of
goods and services.
I could probably cite passages out of elementary economics texts to
support my view, but I imagine it would simply turn into a "he said, she
said" kind of discussion.
The only people I can imagine who would say that only manufactured goods
could have real value are perhaps 19th century economists, which is
understandable, since that's all they knew.
>
> >
> >>From an economist point of view, manufacturing increases wealth,
> >>service doesn't.
> >>
> >
> >
> >Er, not. My best friend's father when I was a kid was an economics
> >professor at SMU and later at U Wash. I studied the first year economics
> >text he wrote (The Economic Way of Thinking, in case anyone's
> >interested). He would not have agreed with you. Anything which can be
> >paid for can increase wealth.
>
> Hey, I can only debate one person at a time;-) But if I had to guess,
> I would say that you're comparing apples and oranges. Yes, an
> INDIVIDUAL can increase his/her wealth by doing anything for which
> they get paid. They will be paid by some other individual, whose
> wealth will decrease. But the NATION will only have a NET increase in
> wealth (assets) if you BUILD something, GROW something, or DIG
> something out of the ground.
>
The only difference in national or global versus individual economics is
scale. The same basic principles apply.
<snip>
> I don't really see your point here. I've noticed that you think in
> terms of economic cycles and variations. I think you should consider
> the historical view, and the rise and fall of nations. The British
> empire was the one previous, now we are at the peak (heading down) of
> the American era, and China will be next.
Yes, I do think in terms of basic economics, including cycles of growth
and decay. I think that's the first thing one has to agree on before
going on to the historical perspective. If you can't agree on the
manufacturing vs service issue, I don't know how you can progress
further in a discussion of economics.
As for the destruction of empires and its causes, you could be right.
But historians seem to have as many views as there are historians, and I
have a feeling that most of them are wrong. You seem to think that the
destruction of empires has to do with economic realities, as opposed to
other factors. Again, this may be true, and there may be historians who
would agree with you. But I'm inclined to believe that the destruction
or decline of empires comes from the degradation of morality and ethics,
which may in turn have economic consequences. I can't prove my theory,
and I'm not particularly a student of history. And unfortunately, there
is a lot of crap out there that passes for history which is dead wrong.
I think it would require years of work to come up with a common thread
on the destruction of empires or nations.
I imagine America is on the way down. It was only a matter of time, as
things go on this planet. We will have had a shorter, but more
spectacular run than the Romans. There are, of course, ways to reverse
the decline. But there seem to be an awful lot of people whose sole
desire is to bring us down. And unfortunately, most Americans are simply
going along in ignorant bliss. And I suspect shipping jobs overseas is
the least of our worries when it comes to the destruction of the
American empire.
Paul
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