Why global warming would be good for us

[Borachio]

But wouldn't that also apply at the national level? So why do we see increasing inequity in the world?

It's almost like the super rich don't have their own best interests at heart.

I can't help feeling there's something very contradictory going on here.

 

[James Stuart]

But wouldn't that also apply at the national level? So why do we see increasing inequity in the world?

It's almost like the super rich don't have their own best interests at heart.

I can't help feeling there's something very contradictory going on here.

They're pursuing short-term gains at the expense of long-term stability. Short-sighted and stupid, but profitable in the short-term.

 

[El_Machinae]

But wouldn't that also apply at the national level? So why do we see increasing inequity in the world?

Well, 'increasing inequity' is a different thing. All parties can become richer and still have increasing inequity

3rd World poverty has a mixed bag of failures. Their problem is mostly due to corruption and a lack of rights. A wealthy trading partner is of no benefit when you cannot engage in mutually beneficial trade.

But, Muricans Eagle's policy of actively harming the wealth of your trading partners is a separate question, because it's very obviously not the game-winning strategy

 

[Borachio]

Yes. But, dealing with national inequity, if having workers who can afford to buy more of your goods because you pay them more, means that you make more yourself, why doesn't it lead to both more inequity (because you're making more) but also less inequity because you're paying your workers more?

That's very strange: I can't seem to express what I want to say at all!

You see, wealth is all relative anyway, it seems to me. It really doesn't matter how much real wealth you have; just as long as you've got more than anyone else. And the more more you have, the wealthier you are.

 

[Terxpahseyton]

The problem with comparative advantages is that it makes fixed assumptions about your countries abilities to produce / create wealth.
What that means is that while comparative advantages may demonstrate that international trade makes everyone better off for the moment it has little to say about how international trade benefits your future economic development.

So it for instance overlooks the use of protectionism to develop your economy and be able to better compete in the global market in the first place, or how cheap food imports to Africa can be harmful to the local African economy.

Basically, the global economy is a fight over the best places in the economic food chain - and the theory of comparative advantages ignores that fight.

 

[El_Machinae]

So it for instance overlooks the use of protectionism to develop your economy and be able to better compete in the global market in the first place, or how cheap food imports to Africa can be harmful to the local African economy.

That's all true. There are absolutely losing industries when you're looking at comparative advantage. So, short-term protectionism is one route to turn a losing industry into a non-losing industry. Comparative advantage analysis shows us that this protectionism is more affordable, though, if we allow other types of trade in the meantime.

But, this is neither here nor there for the OP's thesis. His goal was weak neighbours.

 

[Terxpahseyton]

But, this is neither here nor there for the OP's thesis.

No, but Borachios confusion motivated mr to post some personal musings on it

 

[El_Machinae]

Yes. But, dealing with national inequity, if having workers who can afford to buy more of your goods because you pay them more, means that you make more yourself, why doesn't it lead to both more inequity (because you're making more) but also less inequity because you're paying your workers more?

This is a separate policy discussion, a separate concept even. Comparative advantage has more to do with how much stuff you can get in trade. It's a major way in which wealth rises. One reason why we're richer is that we all are vastly more productive, and so it makes sense for the value of our trades to rise over time as the value of our production rises over time.

So, since I can make ten loaves of bread per hour and you can catch 20 fish per hour, it makes more sense for us to each work an hour and exchange 10 loaves for 20 fish, instead of me spending an inordinate amount of time trying to catch 20 fish myself. In the end, through trade, we each collect more wealth than we could have generated ourselves.

You see, wealth is all relative anyway, it seems to me. It really doesn't matter how much real wealth you have; just as long as you've got more than anyone else. And the more more you have, the wealthier you are.

Oh, I profoundly disagree. An incredible portion of wealth is absolute. Psychologically, we have a lot of 'relative wealth' involved in our calculus, true. But we're also capable of overcoming these primate instincts and looking at absolute wealth.

My longterm plans require our absolute wealth to grow

 

[Borachio]

Well, it's certainly true that the average person in the C21st has access to more wealth, in terms of TVs, dishwashing machines, and motor cars, than the average Roman citizen. So is that the sense you want to argue for absolute wealth?

But I suggest that the purpose of wealth is really to get other people to do things for you, and in that sense all that matters to be wealthy is that you have more of whatever is the current measure of wealth than anyone else.

 

[El_Machinae]

Is the purpose of wealth really to get people to do stuff for you? Or that you can get the best quality 'stuff' per unit wealth that you spend?

I'd rather work an hour to afford a flu shot than have a host of 19th century doctors trying to keep me from dying from a horrid bout of the flu

 

[Borachio]

I'm not sure. It's an interesting question.

As I said earlier, it's of course the case that no amount of wealth could have bought a Roman a flu shot.

But I do think wealthy people very often employ people to do stuff for them. Otherwise who is going to clean their mansions, and wipe their backsides for them?

A few eccentric wealthy people don't, of course. But they're rather the exception.

What else is wealth for? There're services (which are plainly labour intensive) and there are products.

You buy the best product that you can afford, and that generally is something that has the most man-hours invested in it one way or another.

Or there are investments in industry. Which seems to be plainly controlling what other (presumably less wealthy) individuals are doing.

 

[CavLancer]

Ya, because they want work to feed their families. I see that more and more here. I was a carpenter/roofer much of my life, sweating in the sun. Made some money riding housing bubbles to the top and getting out. Not on spec houses but personal residences.Brought that money to the Philippines where it goes a lot further and built a couple houses here and in the process made good friends out of a few hard working souls. Thing is, not much work here so when they're done its back to poverty for them, and their families. So when my wife suggested turning our ocean house into a restaurant I thought, MMmmm, pizza. Then I thought of a way to provide for kids we're adopting, workers we're letting go, plus make a few bucks. its all good.Its jobs and hope for the future.

There is another employer here in town, a big one. Maybe a thousand people. They sell limestone from the hills here, high quality limestone and ship it to buyers in the region. Recently a typhoon threw a ship against their conveyor head and destroyed it and the ship sank at the dock. While they can still haul the limestone down from the hills in trucks, the business is much reduced. Maybe 600 or 700 people lost work. When industry is damaged so are the people, the workers and their families. People here are devastated at the loss of their industry. Industry is a good thing. Its individuals striving to succeed. Sure the top guy gets a big head and a nice suit, and these things are fugly, but maybe he made something out of nothing and helped the people to help themselves and can be excused a little excess.

The ones who really suck sold US jobs to a communist dictatorship for fancy suit, like money is all the justification they require.

 

[Hygro]

The problem with comparative advantages is that it makes fixed assumptions about your countries abilities to produce / create wealth.
What that means is that while comparative advantages may demonstrate that international trade makes everyone better off for the moment it has little to say about how international trade benefits your future economic development.

So it for instance overlooks the use of protectionism to develop your economy and be able to better compete in the global market in the first place, or how cheap food imports to Africa can be harmful to the local African economy.

Basically, the global economy is a fight over the best places in the economic food chain - and the theory of comparative advantages ignores that fight.

I'm being replaced!

 

[Terxpahseyton]

Oh dear, don't make me blush.

 

[luiz]

The problem with comparative advantages is that it makes fixed assumptions about your countries abilities to produce / create wealth.
What that means is that while comparative advantages may demonstrate that international trade makes everyone better off for the moment it has little to say about how international trade benefits your future economic development.

So it for instance overlooks the use of protectionism to develop your economy and be able to better compete in the global market in the first place, or how cheap food imports to Africa can be harmful to the local African economy.

Basically, the global economy is a fight over the best places in the economic food chain - and the theory of comparative advantages ignores that fight.

How exactly does it ignore that? The US was once an exporter of commodities and importer of manufactured goods, then it became a huge exporter of manufactures, then it started importing them again and exporting technology and financial products. And trade has always been beneficial, despite the changing nature of the comparative advantages.

This notion that international trade is a struggle for top positions, as opposed to something mutually beneficial, is... I don't know, scarily German.

 

[El_Machinae]

I dunno. It's a fairly common sentiment. It's strangely difficult to beat into people's heads that wealth creation is not a zero-sum game. And, I see that across all political stripes.

I am a member of a fairly right-wing American board as well, and there's the common sentiment that America 'props up' much of the world with their trade. I mean, in some ways this is true, but they actively believe that the trade makes them worse off and that closing the borders would be better. On top of that, there's a heavy vibe of wanting to "be the top of the sandpile", wealthwise.

Lots of people value in relative wealth more than absolute wealth. I guess we can see where that comes from, other primates seem to have that instinct as well.

 

[luiz]

I dunno. It's a fairly common sentiment. It's strangely difficult to beat into people's heads that wealth creation is not a zero-sum game. And, I see that across all political stripes.

I am a member of a fairly right-wing American board as well, and there's the common sentiment that America 'props up' much of the world with their trade. I mean, in some ways this is true, but they actively believe that the trade makes them worse off and that closing the borders would be better. On top of that, there's a heavy vibe of wanting to "be the top of the sandpile", wealthwise.

Lots of people value in relative wealth more than absolute wealth. I guess we can see where that comes from, other primates seem to have that instinct as well.

Yeah I can see that. International trade does tend to benefit those at the bottom more, on relative terms, then those at the top, so there could be the impression that those at the top are being screwed over, but that's not true.

Everybody got better off by China ceasing to be a starving communist hellhole and integrating to international trade (and by everybody of course I mean in aggregate, some individuals of course got worse off, even in China).

 

[El_Machinae]

Yeah, you can see that in comparative advantage studies. The industry that is chosen against will suffer a decrease in employment (while in the meantime, the country will get more of that industry's specialty). A reasonable case for transitional welfare efforts can be made from that. If a new trade agreement ruins your ability to compete with a foreign industry, then the companies will push for protections, but the real answer is more to help the workers relocate, I'd think

 

[aelf]

I dunno. It's a fairly common sentiment. It's strangely difficult to beat into people's heads that wealth creation is not a zero-sum game. And, I see that across all political stripes.

You're missing the time dimension, which was brought up. The long term benefits of unrestricted trade is much less certain than the short term.

And even in the short term (especially the very short term) there could be much harm done. Could you explain to me how the economic dislocation of much of the population, for example, can't be harmful to a country?

 

[El_Machinae]

Well, in a sense, the post immediately before yours already touched on that. Can you recouch your question?