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Comment by OGEnthusiast | Hacker News Reader

The fact that this is even plausibly true means that the non-AI (and maybe even non-tech) American economy has been stagnating for years by now.

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Almost all my money goes to mortgage, shit from China, food, and the occasional service. It does make me wonder some times how it all works. But it's been working like this for a long time now.

Why are you buying shit from China?

Why, don't you? How would you have posted this message if you hadn't?

You got me. I buy old second hand phones because the planet is full of mugs.

Where are you getting your shit from?

I have a deal with Cologuard.

Down the road where I can.

Apparently it's even hard to make molds in the US. China seems to be the top dog in the production chain. From design, to mold, to production, to packaging.

Fstopper has one or two nice videos about it. Can't even buy US made glass bottles that fits his needs in the US: https://www.youtube.com/watch?v=xewpuM1eJRg

It cuts the middleman, supermarkets and online stores are 90% Chinese dropship these days. Why pay the 50-500% markup?

I have no idea what you’re talking about. What the heck are you people buying?! I mean, after some pots and pans and a couple of t-shirts what else is there?

I'm very frugal but I buy some electronic parts every now and then, last time I bought a titanium hiking pot, $12 instead of like $50 locally, same factory, the only difference is that the brand is not stamped on it

I am delighted to hear from the actual FedEx’s own Chuck Noland! Getting this post to appear on this website using only vellum and iron gall ink is an incredible feat. Could you share some about your process (in many months time obviously)?

See this can be the issue with posting on the internet without directly using Chinese-built electronics: you have to periodically remind your seneschal what your various shorthand terms mean or they will make mistakes like forgetting what “ctrl+D” means and assuming you meant “downvote” and not “bookmark”

I've started buying clothes from China. Quality and style is starting to really improve.

Makes you wonder how much we've been ripped off for years.

As a 6'5" male westerner finding the right size is next to impossible.

While you can't go off the standard S M L sizing scale, if you know your measurements you should be able to find something suitable

Ripped off? I think it’s more that you are ripping off people from other countries, whilst undermining your own economy and draining your country of meaningful work. It’s nice to pay your neighbour properly for the work they do. How much clothes are you actually buying and why? The clothing industry is a horrible one, riddled with waste and slavery. You been to the factory where they’re making your clothes have you? Wake up man. This shit matters.

It's very difficult if not impossible to avoid. Just how many hours do you want to spend doing research for _every single_ household item? It'd be genuinely difficult, and even plenty of stuff which claims to be "made in the USA" is actually just assembled here. It's possible to look these things up, but that takes time and it's difficult to get absolute certainty. And not all stuff from China is terrible, either. It's just an opportunity cost which is nearly impossible to avoid given just how common so much of the crap from China is.

A normal person who doesn't want to upend their life might have a few easier baby-steps: buy as little stuff as possible, and buy used whenever possible. The original country doesn't see any real direct benefit when you buy used.

Its very difficult to buy something "made in china" that is actually made there, not just assembled there. Even if you get something like a DJI drone, you can do some quick research and find out the guts (SOC) is from a company in California using IP from Europe/USA (arm).

That's a good point as well: where do you draw the line? If I buy a car, were the screens made in China? Is that a sufficiently small portion of the car to render it acceptable? If so, what about every remaining part in the car?

It just depends how important you think it is to chose who gets your money, where raw materials are coming from and how things are made. I happen to think it’s the most important global issue right now. Come at me.

It's better quality. The people there are skilled and well-educated, and the factories and machinery are modern.

That's partially a euhpemism for imported stuff. But more to your general meaning the point of the article is that there's not a lot of slack. The US is pretty close to fully utilized and there's not a lot of slack to start making stuff here instead.

why not? I like high quality products at reasonable prices

Real estate. The US economy floats on the perpetually-increasing cost of land. Thats where your mortgage money goes, to a series of finacial instruments to allow others to benifit from the eternally rising value of "your" property.

Much worse the case in Canada & Australia unfortunately

It amuses me what's been true in the rest of the world (Vancouver, Sydney, Aukland and London come to mind but I'm sure it's not just the Anglosphere) for decades arrived in the US a couple of years ago and is suddenly a shocking new thing

Why is that amusing to you?

Americentrism. America discovers that water is wet and suddenly out come the flags and eagles

That makes sense. Those other places don't actually matter, but America does.

Can't even understand whether you're being ironic or not.

They matter, but not like in the sense that Americans should care about them.

If something hasn't happened in your area before, it is new to the experiencer regardless of it having occurred elsewhere. If an area experiences a flash flood are you likewise amused by their exasperation at the novelty of their situation, despite it having occurred to plenty of other people in other places?

Maybe this is our "resource curse"? We just happened to get rid of all the other resources first to get to stuck with this remaining?

Part of it is a hidden tax on the young and workers, by making currency less valuable (what young people and workers have, the ability to earn cash) and transferring that wealth to old people and asset owners (to pay for pensions and healthcare).

That is why mortgages are (future) taxpayer subsidized. Without the subsidies from the future, the real estate prices would not be able to rise so much.

There is also economic agglomeration to exacerbate the issue.

Working class old people (the kinds that need pensions and healthcare) are not accumulating your wealth. Pensions and healthcare are nice in that they're almost immediately consumed. Nobody gets rich from needing financial help for healthcare.

You should not look towards pensions and healthcare, but rather the actually wealthy old men. Those are who the ones stealing your future.

Productivity doesn't materialize out of thin air. If something is being consumed, it has to be produced. And lots of old people, presumably more than you implied via "wealthy old men", plan on being able to consume in combination of selling the assets they have (either directly, or via some defined benefit pension fund manager selling and distributing them cash), and by receiving direct wealth transfers via cash or healthcare services.

Well, it is much worse elsewhere.

You should look at other countries where pay is much less and real estate is at similar levels of cost: from Europe, Canada, China, Australia and India.

Condos in Mumbai are priced similar to those in the major cities in the US.

https://www.reddit.com/r/mumbai/comments/zxsl8l/mumbai_real_...

And Mumbai is one of the more affordable cities globally.

Federal taxes are #1 expense for most people. People forget to think about it because of direct deduction.

This isn't true. At 70k (much higher than the median income), the effective federal tax rate is under 10%. People generally spend more than 10% of their income on housing. If taxes are your number one expense you likely have a significantly larger than average income.

Prices going up 20-25% due to excessive money printed and hence high inflation during last administration don't help.

The stimulus spending started under the administration prior to the last one.

In the United States, elections were held on November 2020. A new administration would’ve started in January 2021.

The extent to which media and the public both blame Biden for events prior to his administration's start is deeply concerning.

They know that their remarks are frivolous, open to challenge. But they are amusing themselves, for it is their adversary who is obliged to use words responsibly, since he believes in words.

They have the right to play. They even like to play with discourse for, by giving ridiculous reasons, they discredit the seriousness of their interlocutors.

They delight in acting in bad faith, since they seek not to persuade by sound argument but to intimidate and disconcert. If you press them too closely, they will abruptly fall silent, loftily indicating by some phrase that the time for argument is past.

Oh, come on. Why don't you mention the Inflation Reduction Act (IRA)? Which actually stoked the inflation by increasing government spending when the labor market was very tight?

IRA's pie in the sky green energy cost reductions were going to take years at least to show any benefits - assuming there were any benefits.

High inflation belongs to Democrats just as much as it belongs to Republicans.

Would you care to quantify IRAs spending vs the amount spent by the government buying securities in 2020?

Please quote the exact part of my statement where I absolve any political party of blame for inflation-inducing measures.

The only two plausibly mainstream (by name, not votes) parties I am willing to absolve blame would be the Greens and Libertarians as they hold no power.

Are you ignoring the inflation from COVID that occurred globally on purpose? Trump won, there is no need for you to keep spreading MAGA propaganda.

Pretty sure the stagnation has a cause beginning in 2025 and that has to do with things like: Canada refusing to buy ALL American liquor in retaliation. China refusing to buy ANY soy beans in retaliation. In retaliation for what you might ask? I leave that as an exercise for the reader. If you are unable to answer that question honestly to yourself you need to seriously consider that your cognitive bias might be preventing you from thinking clearly.

Also EU moving away from US weapons. We're destroying all our exports.

I think the reason could also be a lot of countries and companies started to diversify more and depend less on the USA

The tariff wars certainly didn't help.

depends, on which side, of the tarrifs an economy happens to be and where, geopoliticaly.

AI, or whatever a mountain of processors churning all of the worlds data will be called later, still has no use case, other than total domination, for which it has brought a kind of lame service to all of the totaly dependent go along to get along types, but nothing approaching an actual guaranteed answer for anything usefull and profitable, lame, lame, infinite fucking lame tedious shit that has prompted most people to.stop.even trying, and so a huge vast amount of genuine human inspiration and effort is gone

The thing about tariffs is you’re guaranteed to be on both sides because the other side retaliates.

Farmers get screwed twice because our tariffs increase the costs of their inputs and the retaliation reduces the value of outputs.

If I was a farmer I’d be tearing my hair out about now.

Farmers stand to benefit from the current administration's trade and immigration policy; bailouts are part of the program. Bailouts were given out during the trade wars in 2017-2020. Bailouts are expected to pay out in early 2026 as part of the annual farm aid bill due in November.

You do have to make it till then, a lot of smaller farmers may not and it will increase consolidation of farming even more

Not only bailouts, but GOP aligned farmers voted for Trump to remove 2024 H-2A visa reforms that addressed abuse of the system (seizing passports, etc).

They didn't want to pay for the H-2A paperwork, but didn't like that undocumented laborers would move from farm to farm depending on conditions.

https://www.youtube.com/watch?v=zdWrHb8b-c0

Not just both sides, but infinite sides, every country border for anything that crosses the border. Making a pencil might requires dozens to thousands of mining/factories in the pencil supply chain and there is taxation at every level!

Milton Friedman - I, Pencil: https://www.youtube.com/watch?v=67tHtpac5ws and https://thenewinquiry.com/milton-friedmans-pencil/

"Look at this lead pencil. There’s not a single person in the world who could make this pencil. Remarkable statement? Not at all. The wood from which it is made, for all I know, comes from a tree that was cut down in the state of Washington. To cut down that tree, it took a saw. To make the saw, it took steel. To make steel, it took iron ore. This black center—we call it lead but it’s really graphite, compressed graphite—I’m not sure where it comes from, but I think it comes from some mines in South America. This red top up here, this eraser, a bit of rubber, probably comes from Malaya, where the rubber tree isn’t even native! It was imported from South America by some businessmen with the help of the British government. This brass ferrule? [Self-effacing laughter.] I haven’t the slightest idea where it came from. Or the yellow paint! Or the paint that made the black lines. Or the glue that holds it together. Literally thousands of people co-operated to make this pencil. People who don’t speak the same language, who practice different religions, who might hate one another if they ever met! When you go down to the store and buy this pencil, you are in effect trading a few minutes of your time for a few seconds of the time of all those thousands of people. What brought them together and induced them to cooperate to make this pencil? There was no commissar sending … out orders from some central office. It was the magic of the price system: the impersonal operation of prices that brought them together and got them to cooperate, to make this pencil, so you could have it for a trifling sum.

That is why the operation of the free market is so essential. Not only to promote productive efficiency, but even more to foster harmony and peace among the peoples of the world."

This is tangential to your point about globalization, but the funny thing is that within a firm, especially a vertically integrated one, there really are commissars sending out orders from central offices, dictating production quotas and setting prices. Most companies resemble a command economy on the inside, much more than a market economy.

And almost all economic activity and production is mediated and coordinated by firms. Very few transactions happen between unaffiliated individuals independently making and trading goods according to direct market incentives.

https://en.wikipedia.org/wiki/Theory_of_the_firm

https://en.wikipedia.org/wiki/The_People%27s_Republic_of_Wal...

Yeah but those commissars act upon market forces and market forces alone. They screw up and overproduce? Bam! And financial punishment comes. Underproduce? Bam! All the lost could-have-been profit went elsewhere.

Any attempt to not have market as part of the loop just leads to long term inefficiency, punished as it should be. I wont be buying overpriced pencils from bad planners unless they are the only ones in the world, and in such case I may be motivated to look for alternatives.

Right, but pertinent to the pencil example, there can indeed be a single company that makes everything from the brass ferrules and the machines that stamp them, to the rubber and the graphite and the wood, coordinating all of the people involved, with the market mechanisms only acting at the periphery. And often this ends up being a cheaper and more efficient way to coordinate the people involved in pencilmaking than rival ferrule-salesmen independently pitching their brass ferrules in a market, and soliciting unaffiliated day-laborers to run their presses, because of the significant savings on transaction costs.

>Most companies resemble a command economy on the inside.

A whole lot of people need to be frequently reminded of this.

A whole lot of people work in corps, pretty sure they know how corps work.

> A whole lot of people work in corps

Agree

> Pretty sure they know how corps work.

Hard disagree

It needs to be paired with an understanding that they do this _with their own money_ and with _their skin in the game_, which are fundamentally missing from broader command economies.

The fundamentals behind the 2008 financial crisis didn't come from nowhere and the "solution" to 2008 did little more than kick the can down the road.

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