Comment by WalterBright | Hacker News Reader

Comment by WalterBright | Hacker News Reader

Parent Full thread

Your scheme of society (government) deciding everyone's wages. Many times. It doesn't work out very well. In fact, people in those societies are always trying to get into the US, where wages are set by the market.

BTW, you're free to donate whatever you feel is just to your garbageman.

> Try to transcend for five seconds the decades of propaganda you've sustained

Are you sure I'm the one affected by decades of propaganda?

For one thing, you appear to subscribe to the Labor Theory of Value, where someone's effort and time determine their wage, rather than what actually happens is what one produces that determines their wage. The LToV has been thoroughly discredited. It's pretty easy to discredit:

Consider someone digging a hole in the ground. He works hard, sweat pouring off his body. Then, he fills it in again. What value has he produced? Nothing. What would you pay someone to do such a thing? Nothing. I bet you pay for results, not sweat, when you pay someone to do something for you.

I think the main thrust of the point is that we often overlook and under appreciate the people who labor on our behalf. Hopefully Covid made it more clear how essential some of the less regarded professions are.

Personally, I’d us to take care of those folks like they took care of us. The market works okay, but isn’t perfect and can miss a number of negative externalities that it doesn’t always account for - and yet the bill always comes due.

> Your scheme of society (government) deciding everyone's wages.

I'm not (necessarily) suggesting that the government decide everyone's wages. Leaving it to the market is just another way for society to determine wages.

> you appear to subscribe to the Labor Theory of Value, where someone's effort and time determine their wage

That's not what the LToV says. To start, a wage is a price, and Marxists draw a distinction between price and value.

But that's also not even the point I was trying to make. My point was: "one keeps what they earn" is a truism under any system, if "what they earn" is taken to mean "what they're paid". If, instead, "what they earn" is taken to mean "the price of what they produce", then that's obviously false under capitalism wherein companies make profits, so I assume that was not your intended meaning.

The company's profits are not taken from the worker. The company provides a framework within which the worker can produce value, and the company therefore gets a share of it.

Otherwise, the worker could do the work outside of the company and get it all.

You're just saying that the company collects economic rent from the worker for the privilege of accessing the "framework", in different words.

This thread feels so odd to me. I studied economics and I understand things intellectually the way Walter does. LTV for sure does not work. The market decides things by marginalism.

But I also live in the real world and I think there's just a gigantic number of people who are paid something different from what they ought to be paid.

We may just be seeing the beginnings of it now in the UK, with lots of strikes about to happen.

I'm also well read enough to have heard all the arguments, sadly. It's the same over and over. "It's not a real free market" as the counterpart to "communism has never been tried". "People get paid their marginal product" is another one.

"If you don't like it, why don't you just pay the guy/government yourself" is another wiseass answer I've seen in these debates.

The orthodox economically literate answer somehow to me is not satisfying and needs some reassessment.

> another wiseass answer

There is a deeper point to that - that people tend to be free with money as long as it doesn't cost themselves. People behave very differently w.r.t. what is "worth" spending money on when it is their money, as opposed to someone else's.

> what they ought to be paid

How do you propose to determine that amount?

> is not satisfying

Nothing human is perfect. But in trying to get that last step towards perfection often just makes things worse. There's no such thing as a perfect free market. Nor would a perfect free market produce perfect results. It's just that, so far, nobody has devised anything that works better. The solutions I see people propose have all been tried before. If they worked, we could point to them.

> There is a deeper point to that - that people tend to be free with money as long as it doesn't cost themselves. People behave very differently w.r.t. what is "worth" spending money on when it is their money, as opposed to someone else's.

This is typically where people drop in their Milton Friedman video/meme: "With my own money... with someone else's..."

Which has a grain of truth to it, just no nuance.

> How do you propose to determine that amount?

Certainly the answer isn't "whatever the machine spits out". Which at the bottom of it is what free market fanatics are saying. At least we should work on the machine so that the inputs are something sensible.

A link to the Milton Friedman video

https://www.youtube.com/watch?v=nBWXuptwJpg

> Which has a grain of truth to it, just no nuance.

I see it in action all the time. In the small, parents know that kids are sloppy with money given to them. When they earn the money, they suddenly get careful with it. In the large, politicians play on the "tax the rich" theme because that means someone other than the bulk of voters will be paying the bill.

> free market fanatics

This sort of thing discredits your postings. It isn't necessary to be a fanatic to study economic history and see how well it works. The evidence is pretty compelling - far more than a "grain" of truth.

Reply on news.ycombinator.com