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You are missing my point. I'm not overly concerned about work, especially if the work is artificial. I'm focused on real wealth and its creation.
What I define as wealth, are those activities which create something of "real value".
Imagine it like this. Lets pretend there were undeveloped islands. How would someone go about "building wealth" on these islands? As a general rule, it would be about the "improvement of land" and the "creation of resources".
For instance, building a house, or clearing rocks to plant fields of crops, building storehouses to hold food, making fishing poles, or making a boat, or a dock, or even the creation of art. To me, wealth is about the creation of things of "real value". Things which improve the human condition.
Someone who buys a house at auction for $40,000, doesn't improve it, then sells it for $60,000. Is he creating wealth? What value is he actually creating? What benefit is there to society as a result of him being able to rip someone else off for an extra $20k?
As I said, I played a video game where people would buy items cheap and mark them up. Basically, there might be an item that normally sells for 500 gold, and someone who maybe was a new player or was otherwise unfamiliar with auction house prices, lists the item for a mere 100 gold.
Someone buys that item almost instantly and then immediately re-lists it for 500 gold, turning a 400 gold profit.
In your version of the world, this kind of activity is perfectly acceptable. You almost seem to think this kind of behavior is even a social good, something to be praised. You seem to be saying that the man who was able to buy the item for such a low price is "smart", that he earned the extra 400 gold with his intelligence and ingenuity. While the guy who sold the item for only 100 gold must be an idiot, and basically deserves nothing.
This is fundamentally how most of our economy works. The vast majority of the money created in our society, is derived from "speculation". Which is merely the purchasing of something for less than what its worth, and then selling it for a profit. Even worse, much of the money used to finance this speculation, comes from "loans from money created out of thin-air by the Federal Reserve".
The question becomes, is the making of money through this kind of speculation a good thing or a bad thing? This is where ethics comes into play.
So lets go back to my examples really quickly. Lets pretend that you played the video game with your brother, and he found the item that was worth 500 gold, and you knew it was worth 500 gold. But then you offered him 100 gold for the item without informing him the item was worth more. He accepts the 100 gold, and then you turn around and sell the item for 500 gold.
Lets pretend that he then learns that you sold the item for 500 gold. Would he be upset about it? Would it be "morally right" for you to buy something from your brother at such a low price for your own profit?
For that matter, would you buy a house for $40,000, and then turn around and sell it to your brother for $60,000 without improving it in any way? Basically, is it morally right to exploit your own brother for your own gain?
Why might it be morally wrong to exploit your brother, but not morally wrong to exploit a stranger? Isn't it true that the only reason people are able to speculate and exploit within our system, is because our system is so impersonal? That we live in a system of strangers, all of them whose primary goal is merely to take whatever they can get, regardless of who pays, or who suffers.
Just because what we have is what we have, doesn't mean it is either natural or good. Just because something is legally sanctioned, doesn't make it right.
So, in your opinion, my chosen career is also morally wrong. I'm in sales. My company manufactures widgets for a dollar and I go out and sell those widgets for 10.00 each. Am I "screwing" my customers because I mark up my widgets this high? People will generally only pay what the market will bare. My customers value my product and, to them, 10.00 is a fair price
So, in your opinion, my chosen career is also morally wrong. I'm in sales. My company manufactures widgets for a dollar and I go out and sell those widgets for 10.00 each. Am I "screwing" my customers because I mark up my widgets this high? People will generally only pay what the market will bare. My customers value my product and, to them, 10.00 is a fair price
It's not that your career is wrong. It's the fact that the 900% profit margin could easily be adjusted to 830% and double the wages of the production workers. The owner or stockholders would see a slightly smaller ROI and they are the ones who can afford this without a change in lifestyle. Your position is necessary. I'm assuming you receive commissions and that you report to a sales manager, who reports to a vice president, who reports to a cfo/coo, who reports to president/ceo/board/stockholders, depending on the size of the company. All of these layers of parasites are why the 900% profit margin is required to make it a viable business. As the money flows UP, these demands increase at each successive level.
Manufacturing and professional services are the easiest industries in which to balance the distribution of wealth.
In the service industry, specifically restaurant and retail, all expenses are represented as a percentage of gross sales. This is where the predicted huge bump in prices comes from. If your labor cost is represented by 25% of sales, and you raise wages by 50% it reflects upon prices as a 33% increase in order to maintain the percentages. However, if you adjust prices to reflect only the wage increase, it is 50% of 25%, or 12.5% of gross sales. 12.5 cents on the dollar. The accounting method for this would have to reflect the wage increase only, perhaps as a surcharge. Not at all the devastating price increase that will drive away all customers and close the business. In many business models it would take an even smaller increase than that to recover the cost of the higher wage.
Everyone save a few seem to be basing their opinions from media articles and party lines rather than looking at the economy as a whole. When you do that you soon see how it is against the interests of the top to create a working system. Now who is to blame for the welfare state we have today? Lazy people who don't want to do better? Or greedy people who want more and more at the expense of society as a whole?
And it doesn't even matter how much they are taxed, because that money goes right back into the economy and trickles back up to them, because they own the majority of everything. The rest of us only use it for a little while.
It's not that your career is wrong. It's the fact that the 900% profit margin could easily be adjusted to 830% and double the wages of the production workers. The owner or stockholders would see a slightly smaller ROI and they are the ones who can afford this without a change in lifestyle. Your position is necessary. I'm assuming you receive commissions and that you report to a sales manager, who reports to a vice president, who reports to a cfo/coo, who reports to president/ceo/board/stockholders, depending on the size of the company. All of these layers of parasites are why the 900% profit margin is required to make it a viable business. As the money flows UP, these demands increase at each successive level.
Manufacturing and professional services are the easiest industries in which to balance the distribution of wealth.
In the service industry, specifically restaurant and retail, all expenses are represented as a percentage of gross sales. This is where the predicted huge bump in prices comes from. If your labor cost is represented by 25% of sales, and you raise wages by 50% it reflects upon prices as a 33% increase in order to maintain the percentages. However, if you adjust prices to reflect only the wage increase, it is 50% of 25%, or 12.5% of gross sales. 12.5 cents on the dollar. The accounting method for this would have to reflect the wage increase only, perhaps as a surcharge. Not at all the devastating price increase that will drive away all customers and close the business. In many business models it would take an even smaller increase than that to recover the cost of the higher wage.
Everyone save a few seem to be basing their opinions from media articles and party lines rather than looking at the economy as a whole. When you do that you soon see how it is against the interests of the top to create a working system. Now who is to blame for the welfare state we have today? Lazy people who don't want to do better? Or greedy people who want more and more at the expense of society as a whole?
And it doesn't even matter how much they are taxed, because that money goes right back into the economy and trickles back up to them, because they own the majority of everything. The rest of us only use it for a little while.
You are assuming some of our employees are not paid well and that's a very false assumption. You also assume multiple layers of highly paid executives at the expense of the production workers, also not true. We all work very hard together to ensure our company's success and we ALL reap the rewards of job security, excellent pay with annual performance raises and great benefits to include every kind of insurance under the sun (many paid 100% by the company), onsite gym, health clinic, matching 401k, profit sharing, bonuses, etc, etc and we only have about 2000 employees.
What I define as wealth, are those activities which create something of "real value".
I agree with you mostly. Making "real value" is the productive base of an economy. We've had a debt bubble. One thing about high debt to income ratios is it tends to push marginal things out of the economy. Marginal things like making stuff. Selling stuff adds the most value for the least amount of work. But you need the low margin stuff to or the house of cards collapses.
So, in your opinion, my chosen career is also morally wrong. I'm in sales. My company manufactures widgets for a dollar and I go out and sell those widgets for 10.00 each. Am I "screwing" my customers because I mark up my widgets this high? People will generally only pay what the market will bare. My customers value my product and, to them, 10.00 is a fair price
selling is very important. But making stuff is as important.
You are assuming some of our employees are not paid well and that's a very false assumption. You also assume multiple layers of highly paid executives at the expense of the production workers, also not true. We all work very hard together to ensure our company's success and we ALL reap the rewards of job security, excellent pay with annual performance raises and great benefits to include every kind of insurance under the sun (many paid 100% by the company), onsite gym, health clinic, matching 401k, profit sharing, bonuses, etc, etc and we only have about 2000 employees.
Do you even know how much the lowest paid employee at your company receives?
Even if your post is truth, you are simply one of the lucky ones. In that case I commend your employer for using a socially responsible business model. Your situation does not negate the fact that this scenario is true for many large corporations. As I stated earlier this scenario is less prevalent for small to mid sized companies as it is more difficult for management to dehumanize employees. The generalization is correct in describing the business practices of many large employers. I simply used your post with it's convenient and ridiculous 900% profit margin to lead into an example.
Feel free to experience that free ride. Its just sOOO AWESOME.
I remember the days...of not having enough to eat always, worrying about rent, having to put down a pet rather then take it to a vet. Living with dental work because no one wants to work on your teeth for what the poor people can get for insurance.
That was me and my spouse in our early 20s. We worked and earned our way up and out of that. Millions of other people have done exactly the same (The Millionaire Next Door). Get over your envy and bitterness about the fact that the decisions you made and the actions you took guaranteed the fact that you couldn't do the same.
You are missing my point. I'm not overly concerned about work, especially if the work is artificial. I'm focused on real wealth and its creation.
That's very clearly addressed in The Millionaire Next Door. 80% of millionaires earned their own wealth via making wealth-creating decisions and taking wealth-creating actions. And, yes, it was work to inform themselves enough to know how to do that.
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