Tag Archives: Economics

Lightning Round – 2012/08/01

Here’s my first Lightning Round since my return. As well, I’ve changed the dating system; it used to be each Tuesday, but for time reasons I ended up posting them at midnight, so nobody would actually see them until Wednesday. So now they will be dated for Wednesdays. Not a big deal, but thought I’d mention it.

Why do intelligent young men go on killing sprees?

Romney will lose because he’s beta and even if he won it wouldn’t matter. Aurini take on the elections echoes some of my thoughts.

If you are interested in marrying, do not try to impress the woman; invite her into your life instead.

The “demise of guys” is the result of men following their perceived rational self-interest. If you want young men to engage in society, you have to change the incentives so they want to participate.

Being a bureaucrat myself, I think Bill is a little harsh. It’s less the bureaucrats (at least the lower-level ones) than the system itself; again incentives. I’ll try to write more in-depth on this in the future.

The Captain examines the credentialism gap. The idea of learning a bunch of theory when young that you won’t be able to apply for years is quite asinine.

Idiots wonder about why female children become sexualized like it’s something unnatural. Dalrock points out is it’s natural when you remove cultural conditioning.

A tribute to Friedman, a voice for freedom.

Be free.

Printing assault rifles. Boo-yeah.
Related: Why we need the ability to print them.
Related: Remedial history. Hehe.

Roissy posits that the impact sexbots will be a thousandfold extension of the impact of pornography.

Given that I’m trying to start up an online side business, I appreciate this guide from Art of Manliness.

Hehe. That’s funny.

This is hilarious.

Stupid regulations. Also kinda funny, in a sad way.
Related: Opening a lemonade stand.

Haha… The husband would probably be better off if she did divorce him. Although, I question what kind of pathetic man would marry a harpy like that?

Hmmm… Why is Murfreeburo’s opposition to a mosque “bad” while Chicago’s banning of Chic-Fil-A is “good”. Silly leftists.

If Canada’s economy is the envy of Europe, why the hell do the liberals and leftists want to emulate European economic policies?
Related: What Obama doesn’t want you to know about Canada. Do you mean fiscal responsibility can actually be good for the economy? Shocking.
Related: America is kind of awesome.

An oldie, but it’s good to remember how wrong environmentalists are in their predictions.

Remember, if some groups are not capable of passing your tests, you must be a racist. If women can’t you’re a sexist. Both are illegal.

A possible pending food crisis.
Related: Possible economic apocalypse in China.

(H/T: Patricationary, Wintery Knight, SDA, GL Piggy)

Lightning Round – 2012/06/19

Another long Lightning Round today.

Roissy talks on post-scarcity; he’s not positive on it.

Aurini exposes the idiocy of mainstream discussion on demographics.

Patriactionary has a great list of quips.

Athol explains why men running the MAP have power.
Vox explains why most wives shouldn’t worry about that power and why it’s tragic when older women divorce; it’s kind of touching.

Dicipres finds a couple neat studies.

Dogsquat has a good post on the starter version of the approach attitude.

Forney points out the obvious; game’s pointless if you’re a loser.
The Last Psychiatrist explains how self-loathing protects you from stopping being a loser.

The Poet argues against “enjoying the decline”. Wonder how the Captain will respond?

Frost has a post on his father that is both touching and heartrending.
Related: Walsh shows very clearly how important fathers are.

Glorious Bastard asks what is a women?
Meanwhile, Wintery Knight discusses how feminists want to dominate men.
Related: If a feminist makes poor choices and regrets them the next day, the man should be punished.

A feminist admits there’s no war on women because, get this, not all women are the same. My question: why haven’t anti-abortionists started a “war on babies” meme? It seems like it could be effective.

Gender “equality” creates economic “inequality”.

Britain takes a pro-fatherhood stance on family law. Seems MRA’s have had some impact.

The atrocity you’ve never heard of; when the allies forcibly migrated  conquered foes and forced them into slave labour.

Fox has some good news on the black community. If more of them escape the hell of public schooling, there might be some improvement in their lot.
Related: Bribing the natives not to destroy their own homes.

When diversity hurts those it supposedly helps.

A discussion on measuring happiness. It’s good if you can get over the overly flowery language.

Mainstream economists discovers the obvious.
Some (only some?) mainstream economists are stupid.

The young are the new helots. If they knew what was good for them, they’d join the Tea Party.

The pathologizing of grief.

A libertarian wishlist.
Related: A nice bit of libertarian satire.
Related: Some people do not understand libertarianism at all.

If you want to remove the influence of money in politics, remove the power from politics.

(H/T: SDA, IP)

Economic Costs of Children

Here’s another installment of  my economic analysis of marriage. This time we’re calculating the cost of children.

Conveniently,the USDA has done a study, and it costs $235,000 to raise a child (in a family of two) through age 17 for a middle-income family, about the price of a 2012 Ferrari.

So the question is, over time, which do you think would bring you more utility, a Ferrari or Junior (or a medium sized house, or 4 years off work if you make $60k, etc.)?

That’s that.

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But that doesn’t really make much of a blog post, so more in-depth analysis of the study.

annual expenses ranged from $8,760 to $9,970 for families with a before-tax income less than $59,410, from $12,290 to $14,320 for families with a before-tax income between $59,410 and $102,870, and from $20,420 to $24,510 for families with a before-tax income more than $102,870. (p. 10)
….
As can be seen, total family expenses on a child through age 17 would be $212,370 for households in the lowest income group, $295,560 for those in the middle, and $490,830 for those in the highest income group. In 2011 dollar values, these figures would be $169,080, $234,900, and $389,670, respectively. (p. 20-21)

Here we can see that a lot of the cost of child rearing is likely optional. Low income people can do it for $170,000, so they could only get a 2008 Lexus instead.

If we look at page 26, there’s a complete breakdown of the numbers. Low income people made on average $38k, medium made $80k, and high made $180k. So, we can calculate that, low income people spent about 1/4 of their yearly income on a child, medium income spent about 1/6, and high income spent about 1/9. Because this number is based on having two children, it means you average poor 2-child family would spend half their income on a child, medium would spent a third, and high would spend about a quarter. So, as you get money, you spent a smaller proportion of it on children.

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housing accounted for the largest share across income groups, comprising 30 to 32 percent of total expenses on a child in a two-child, husband-wife family. For families in the middle-income group, child care/education (for those with the expense) and food were the next largest average expenditures on a child. (p. iv)
…
Food was the second largest expense on a child for families in the lowest income group, accounting for 18 percent of total expenditures. Food was the third largest expense on a child for families in the middle income group, accounting for 16 percent of total expenditures. Transportation made up 13 to 15 percent of total child-rearing expenses over the income groups. (p. 11)

Housing is the biggest expense. The study calculated housing by the cost of adding extra bedrooms to the price of a house. You could save money by buying cheaper real estate or jamming or making your kids share rooms or change the basement into the room (both strategies my family used at various times).

If we look at page 26, you can see that costs vary a lost, although, food, clothing, and healthcare vary less, while child care, miscellaneous, transportation, and housing vary by a much larger proportion. This suggests you can only save (or overspend) so much on eating, clothes, and health, but a lot of housing, transportation, and miscellaneous costs are optional. Child care varied the most, so this could either be optional, or simply be that higher income people used proportionately more of it to gain those higher incomes.

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Overall annual child-rearing expenses were highest for husband-wife families in the urban Northeast, followed by families in the urban West and urban Midwest; families in the urban South and rural areas had the lowest child-rearing expenses. (p. iv)

So, choose where you live when you want a family to save on housing costs. If you live in a lower cost area, it costs less. Pretty self-explanatory. Steve Sailer wrote an interesting article on this kind of thing before, give it a check.

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For all three income groups, food, transportation, clothing, and health care expenses on a child generally increased as the child grew older. As children age, they have greater nutritional needs so consume more food. Transportation expenses were highest for a child age 15 to 17, when he or she would start driving. Child care and education expenses were generally highest for a child under age 6. (p. 12)

Interesting, I though babies would be more expensive. Kids eat more as they age and young children use more child care. Makes sense. Learning to drive increases transportation expenses, probably due to buying your kid a car, so tell your kid to get a job and buy his own car.

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Compared with expenditures for each child in a husband-wife, two-child family, husband-wife households with one child spend an average of 25 percent more on the single child, and those with three or more children spend an average of 22 percent less on each child. (p. 17).

So, as Bryan Caplan pointed out, children get cheaper the more  you have of them. For the middle income family, a single child would cost $294k, 2 children would cost $470k ($235k each), and 3 would cost $550k ($183k each). For a lower income family, one would cost $211k, 2 would cost you $338k,  and 3 would cost $395k.

For a middle income family: the first child costs you $294k, the second costs you $176k (60% of the cost of the first), while the third costs you only $80k (27% of the first).

For a lower income family: the first child costs you $211k, the second costs you $127k (60% of the cost of the first), while the third costs you only $57k (27% of the first).

So if you decide to have children, have three or more. Your third child has a 73% discount on the cost of the first, a steal. You can also save a lot by adopting a lower income lifestyle.

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Conclusion:

Kids cost a lot, about as much as a Ferrari, but which would add more value to your life?

A lot of child rearing expenses are optional as evinced by the fact low income families can raise kids on less costs than other families. Housing is the biggest expense and a lot of the costs are optional. Children can be a lot cheaper if you buy less house, squeeze the kids in, and buy in a cheaper area.

Your first kid costs a lot of money, your second costs a fair amount, but your third kid and beyond cost very little, so, if you do have children have a lot. The marginal costs of the additional children after the second are very low.

Lightning Round – 2012/06/12

Welcome back to the Lightning Round, we’ve got a large one today.

The emotions and our genetic drives of red-pill nihilism are just as enslaving and meaningless as blue-pill delusions. In a somewhat related post, Roissy talks of how players lose the ability to find divine love in their quest for meaningless sex.

Feminism is the ideological justification for female childlessness. No matter how much utopian ideologies may ignore it; choices have consequences.

Apocalypse Nowish gives one of the clearest, most straightforward explanations of how the banking system and the government are colluding to rob you.

In surprising news, a study shows government size and economic growth are negatively correlated. The Captain had already pointed out what could have been.

In related news, it seems Americans lost 20 years of wealth  between 2007 and 2010, and everybody makes less except seniors. Related: We are becoming a rental generation and the government refuses to learn from past mistakes.

But, Fearsome Pirate has hope that progressivism can be smashed, while Zero Hedge calls us to have courage in the fight against the tyrants.

Some are not so hopeful. Noting that in fact, Canada is actively destroying itself.

Zero Hedge says bring it on, the solution to our problems is collapse.

The Captain asks “Is it me, or is there something wrong with everybody else?”, and concludes it’s everybody else. Red-pill thinking requires a certain amount of arrogance.

Wintery Knight points out that young Christians are abandoning the fight in an anti-intellectual compartmentalization of the faith. Will S comments. If Christians give up on changing the culture, what then do we have?

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Much has been written on Christian relationships in the manosphere in the last week:

Athol notes that the Bible was written for when men were all alphas under the law, so it recommends beta behaviour, but when culture betaized men, this created hardcore mode for Christian men.

Dalrock points out that the celibate boyfriend is non-biblical. All Christian relationships should be geared towards sex as soon as possible, within marriage.

UMan coins the phrase girligious and notes that Christian marriage has the advantage of a “a rule book written thousands of years ago” in our battle to preserve traditional marriage.

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I knew men committed more suicide, but I never knew it was quite this bad. One possible cause could be that boys are persecuted by the public schools.

Wintery Knight points out the lie that homosexual couples are as good for raising children as straight couples. Related: A homosexual Mormon enjoys a happy an fulfilling heterosexual marriage and family.

Some people still blindly defend the worthless university system and encourage the degree bubble.

Every time I doubt the Conservative Party (and voting in general), they do some small thing that encourages me.

Ummm… No. Chivalry is for ladies, and there are few ladies nowadays.

(h/t: Instapundit, SDA, Wintery Knight, Save Capitalism)

Economic Analysis of Casual Sex – Prostitution vs Game

I previously mentioned I would I would do an economic comparison of obtaining sex through both prostitution and game for casual sex.

Essentially, which of the two mating strategies obtain the best bang for your buck. (Pun most assuredly intended).

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Prostitution

Starting with prostitution (it’s the easiest):

I’m going to assume a mid-range escort. We’ll ignore low-quality street prostitution, which would be cheaper, but risky and the high-quality escorts, as most people can’t afford that regularly. Our assumption will be a clean, fairly attractive prostitute.

According to this intro to escorting guide on a business blog for escorts (I guess escorts need business advice too; the weird things you find on the internet) costs about $250-500/hr depending on the city.

So, we’ll say $300 for sex from prostitution. Adjust upwards if you live in a high cost area or if you’re looking for higher quality.

Given the transactional nature of the interaction, there are no time opportunity costs.

Depending on your jurisdiction, prostitution, or aspects related to prostitution, is likely illegal, so there would be a cost attached to the . Every year, about 8,000 johns are arrested and about 45 million Americans (15%) use prostitutes, so the odds of getting caught are extremely low (about 1 in 5000), especially if you are using escorts rather than streetwalkers. The average fine for a first-time offender is about $250, so the economic costs of the risk of getting cost are negligible (about a  nickel).

Cost for Sex: $300

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Game

I’ve been reading Bang and am almost done (review to come). Near the end of the book Roosh has a little bit on the costs and successes of an average player (someone who goes out to clubs on Saturdays and Sundays with competent game). I’ll assume Roosh knows what he’s talking about (he did write the book on the subject), so we’ll use his numbers.

He does the math in the book, but essentially you are spending $300/month on going to the club, going out on dates, etc. ($3600/year)  for 3-8 notches per year (p. 135 if you want to see). We’ll assume each “notch” leads to an average of three sexual encounters, as some might be one night stands, but a couple might become short- or longer-term relationships.  We’ll give our player 6 notches a year, so 18 sexual encounters at a cost of $200 each.

In addition, each sexual encounter requires time, the nights out, the dates, etc. is time spent in the club, on a date, etc. running game rather than another activity.If you spend an average of four hours clubbing each of Friday and Saturday for a month, that’s 400 hours a year (assuming 2 weeks off).

In addition, from Bang, it seems you can generally expect sex on about the third date and you can expect sex from about half the women you date. So if we assume 2 hours per date for each notch and dating ending in a failure to obtain a notch, we get 72 hours (6 notches *3 dates *2 hours *2 for failures) spent a year on dating.

So, at 472 hours a year at a modest wage of $10/hour, comes to an opportunity costs of spent time is $4720, or $262/sexual encounter.

You would add this to the costs, assuming that you do not enjoy clubbing, game, or dating for their own sakes but are solely in them for the sex. I personally hate clubs, as do many others, and from reading 30 Bangs it was my impression like Roosh only barely tolerates the game so he can acquire sex, so me, Badger, and Roosh would have to add this.

If you enjoy clubbing, gaming, and dating for their own sakes and would engage in these activities even if there was zero chance for sex, you would not have to add these to the calculations, but I’m assuming most wouldn’t, so…

We can conclude that the cost of getting sex through game for the average player is about $460. You could reduce this by becoming better than average, finding a niche like Roosh suggests, running day game, or otherwise reducing your opportunity or real costs.

Cost for sex: $460 ($200 is you enjoy clubbing, gaming, and dating for their own sake)

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For casual sex, a mid-range prostitute is cheaper than game.

On the other hand, most of game’s costs are in the form of time opportunity costs, so if you have a lot of free time and little money or you enjoy the activities of clubbing, game, or dating  even without the promise of sex, then game might be a better deal.

In addition, the higher your average wage, the more expensive game becomes relative to prostitution, as the opportunity costs of game increase the more potential earning you sacrifice.

Conclusion: For obtaining casual sex, game is the better option if you are paid low wages and have free time or if you enjoy game and related activities. Prostitution is the better option if you are middle-class, don’t have the free time, or dislike engaging in game.

In the future, I’ll have a post on the economic costs of sex in marriage and relationship game.

Lightning Round – 2012/05/15

Roosh shows an intro program to learning game. Bookmarking it for if/when I attempt to learn it in earnest.

Advice for learning social skills, for those of us who are not so socially. Combine with above.

Another good question to ask yourself. What do you want?

Uxuriousness is an awesome word I didn’t know before. Avoid it.

Worship: Jesus is King not Boyfriend.

An inspiration to us all.

Not sure what I think on it, but I’ve seen some convincing arguments for not voting recently.

I went to a nightclub/bar (I’m not sure which) once, but I didn’t care for it. Seems others don’t as well.

Good news on the oil front.

How much longer can the statist myth continue? (More)

More evils from the War on Drugs.

Free thought is only allowed if you think the proper thoughts. (More)

(h/t SDA, Private Man, InstaPundit)

Lightning Round – 2012/05/08

A good question to ask yourself.

Something else to keep in mind: nobody cares.

Since when did Frost start writing for the New York Times?

Be good, not nice. Good advice for the Christian man. A bit more on the same topic.

In Soviet America… (insert Yakov Smirnoff joke)

The internet needs the UN like a kulak needs stalinism.

Wonder how feminists will respond to this?

Maybe stagnant wages are caused by Americans nearing maximum productivity.

How to buy happiness.

Nothing we didn’t already know about environmentalism.

We can hope, but Hayekianism does not benefit the state, so I doubt it.

How to retire at 27 (and screw over the next generation).

You mean fighting climate change and overpopulation may hurt people?

Why our generation is screwed.

How true. One of the things I like most about Harper is how much all the wrong people hate him.

(h/t Instapundit, SDA)

The Malaise of Wealth: the Transition to Post-Scarcity

I probably don’t need to regale you about the economic troubles of our generation. Manufacturing work has been declining for decades hurting the economic prospects of the working class. Professional occupations are now suffering as well, enough so that even the mainstream media gets it. Unemployment is near 50% for new graduates and young people are being hammered by the recession. You all know the drill.

Everybody has a solution to the problem. Obama, Krugman, and the Keynesians say throw fiat money at the economy until it moves. Conservatives and libertarians decry excessive regulations and taxes. Economic nationalists say close the border, criminalize outsourcing, end free trade, and put up tariffs, while neo-liberals call for more free trade.

They blame the rich, they blame welfare bums, they blame bureaucrats, they blame capitalists, they blame the young, they blame the old.

The thing is, they’re all wrong.

There is no real solution to Western economic malaise, as the “malaise” is not actually an economic problem.

Our economic “problem” is that we are too wealthy.

Of course, this doesn’t seem to make sense. Unemployment is high, labour force participation is declining, and people can’t get jobs. How can I possibly say we are too wealthy?

If you look at GDP, it has increased steadily for decades. The “great recession” we blame for our economic woes caused the economy to fall to 2007 levels in 2009 (and we weren’t poor in 2007, at the height of the housing boom, were we?), which was promptly righted in 2010. In terms of what we produce, the goods that actually make our life better, the effects were minor.

Our economic malaise is one not of a lack of production, but of a lack of employment.

Or stated another way: as a society, we are continually producing more of the goods we want, but we have to do less work to get it.

It is the second part of that sentence that is the problem: we have to do less work to get it.

That is the cause of our economic problems. That is why there are no jobs, there is no work for people to do.

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The problem is that we are in the process of transferring from a capitalist economic system to a post-scarcity “economic system” and nobody is ready for it. It is something that is completely out of most people’s understanding.

Post-scarcity is a word that some of you may have heard of before, or you may not have. So I’ll explain: a post-scarcity economy is one where scarcity has been overcome, where all people have access to as many goods and services as they want, with minimal labour necessary to produce them. In a post-scarcity economy, people do not have what we would consider to be jobs; because most goods and services can be produced with negligible labour.

People will work, but it will be according to the old Marxist saw “[communism] makes it possible for me to do one thing today and another tomorrow, to hunt in the morning, fish in the afternoon, rear cattle in the evening, criticise after dinner, just as I have a mind, without ever becoming hunter, fisherman, herdsman or critic.”

Work will be something you engage in because you want to, not because you have to. You may choose to hunt, but you will do so because you enjoy it, not because you need to eat. You may choose to design a website, but it will be in leisure, not because the boss says to. You will be able to work at whatever you want, or at nothing, because it doesn’t matter to your material wealth, or anyone else’s for that matter.

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If you want to see post-scarcity today, the best place to look is at the music industry, or perhaps more accurately, it’s continuing collapse. Music can now be made cheaply: at most it costs a couple thousand dollars in instruments and a couple thousand in recording costs. With music creations software, all it costs is a computer you already own and some pirated software to create music. Once the original act of music creation is completed it costs absolutely nothing and requires almost no labour to create another digital copy.

And that’s the whole problem; that’s why the music industry is collapsing. Music executives are finding that it is very hard to justify charging people for what they can get for free. They are fighting free music tooth and nail under the guise of copyright to protect their profits, and they are losing, badly. The economic spin-offs of this are that everybody in the music industry is going to lose their jobs eventually. Why buy a CD when I can download it for free? Why sign with a label when I can distribute my own music on the internet? Why hire a producer when production software is so cheap? Why go to HMV when I can download music at home?

The producer loses his job, the CD manufacturer loses his, the marketing exec loses his, the sales clerk loses his. Thousands of jobs are lost.

Yet, are we poorer? No. Every person in the west now has functionally unlimited access to almost every piece of music ever created at negligible costs. My music library is functionally unlimited and it costs me nothing.

Bill Gates has no greater access to music than I do and I have more access to music than even the richest of men in existence prior to a couple decades ago.

That is post-scarcity.

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Now the problem with post-scarcity is that every economic system we have had to date has been based on scarcity; there was only a limited amount of resources to go around, so we need some way to distribute those resources. Goods required work, so we needed some way to encourage people to work. That’s why capitalism works, it distributes resources to an individual according to how others in society value the individual’s contributions to society.

But in post-scarcity, capitalism breaks down. With resources being unlimited, nobody can profit off the production of those resources.

Nobody knows how to handle post-scarcity.

The RIAA fights music pirating as post-scarcity means they can’t profit off of the goods.

Politicians back copyright law and fight pirating, not realizing that everybody is getting richer in actual terms as everybody now has unlimited music access, but because they aren’t paying for it it doesn’t register in GDP. In addition, the ability to create nigh unlimited music with negligible labour becomes “unemployment” according to economic measures.

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That’s all well and fine for music, but it’s not a material good, it’s easily digitized. Certainly the manufacturing of hard goods requires labour.

Does it really?

We can look at 3D printers.These printers can take raw materials (usually plastics or metals) and convert them into durable goods. Industrial printers are expensive and the technology’s still being developed. Simple home printers can now be purchased for less than a used car. Compare their development to that of computers; 30-40 years ago, home computers were a primitive luxury good for businessmen and geeks, large mainframes were commercial technologies, and the internet was a military project. Now, everybody owns a computer with internet access that easily dwarfs the power of those older commercial mainframes and that has hundreds of applications pre-installed.

Why wouldn’t 3D printers advance like this as well? They may be primitive toys for nerds right now, but a couple of decades from now?

Think about it. If your knife broke (or bowl, or computer, or phone, etc.), you just download plans (which was created for free by an online 3D printing design community) for a new knife  to your desktop 3D printer, feed in some metal and plastic, press the start button, and a minute later a new knife.

If you need a bigger object, say a car, you just go to the free neighborhood printer (why wouldn’t it be free, when another printer can print a printer for almost no cost?), stick in your old car to be broken down for raw materials, then have it print out a new car from plans you downloaded to a flash drive earlier.

Think it sound implausible? Why?

We have the basis for the technology, it’s simply a matter of refinement and scale. Remember what happened to computers.

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Also remember what happened to the music industry.

When this happens (and I believe it’s a when, not an if), why would you need to work, if you could print whatever you wanted? Why would someone pay you for your work if almost anything was free? Why would you pay anyone else for something?

The capitalist market would collapse. Scarcity would disappear.

According to official measures though, GDP would plummet and unemployment would skyrocket.

In addition to the printers, robotics will be used to cover some production.

(I will say this: even in post-scarcity, we will probably need a few people keeping an eye on things, but the prestige, trappings of power, and/or conspicuous altruism of such positions will likely be enough to get the requisite number of people to do this).

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What about raw materials? The printers couldn’t create those.

At first, out-sourcing. We’d pay poor foreigners to mine or grow raw materials with easily duplicated goods. Robotics could also be used.

At some point, recycling would be enough. There is a limit to what you could possibly want.

If you already have three cars and want a new one, just break down the old one and have a new one reprinted. Same with anything else.

What if you want more than what you have? My question would be why?

Most goods are simply positional; they are used for showing off your wealth.

If anybody can print a Lamborghini for the same material cost as a Pontiac (free, except for the $100 of scrap metals and plastic), the Lamborghini would be worthless as a positional good.

Once you have what you need: food, transport, housing, recreation, positional goods made by someone else would  mostly meaningless. Any positional good that would bring you status would have be something deliberately created apart from the printers/crowd-sourced plans.

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What about the services?

These would mostly be made unnecessary.

Amazon has made bookstores completely irrelevant. Steam is making video game stores irrelevant. In the future, 3D printing will make stores irrelevant.

Robotics and AI would replace some of the rest.

Communities of interested individuals would take care of the rest. If you had unlimited free time because work became unnecessary, you would pursue and master your favourite activities would you not? So would others. They would form communities and groups just as they do now. They would provide community members services and teaching, just as they do now.

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So what’s the problem?

The problem is that these are not all going to happen together. Different occupations will be effected at different rates.

Manufacturing has already been dying a slow death for decades as robotics and off-shoring has replaced domestic labour. Unskilled blue-collar labour is already pushing towards post-scarcity conditions.

On the other hand, the trades are still doing well. Skilled blue-collar work is harder to replace.

Unskilled white-collar labour has been going there as well; filing replaced by digitization, clerks were replaced by Excel, etc.

Skilled white-collar labour is harder to replace with technology, but even so, we are approaching the tipping point.

In addition, different industries are effected at different rate. The music industry is in it’s death throes, book publishing will follow soon after.  On the other hand, health care still requires human workers and will for a while to come.

So, while the transition to post-scarcity is occurring, we need a way to incentivise those we need to work to continue working. At the same time, we need to keep those who society does not need to work from causing trouble.

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As a society on the road to post-scarcity, we are already so productive that we already pay a large chunk of our surplus to those who aren’t contributing, and we have been doing this for decades. Social security and retirement, welfare, EI, disability, foreign aid, and the like are all us paying some of our surplus to the unproductive.

The problem is, as soon as we start paying people to be unproductive, then people have less incentive to be productive. If we start just distributing good income to the unproductive with no pretense, then we might not have the people we need producing, producing. So all the above usually have some conditions attached, so it is not a generally usable condition.

Yet, we have a lot more people who need employment, than we have work that actually needs doing, so we have to find ways beside just giving people money to keep them occupied.

****

We have created a number of strategies to keep unemployment low while post-scarcity works itself out.

First is the welfare state. Welfare and disability, properly stigmatized, can keep the unproductive lower classes from causing trouble, while the stigma keeps productive people from pursuing this option.

Second, jail. If we jail the unproductive that cause trouble, they stop causing trouble.

Third, government. I’m a government worker, but we have to face it, government is on the whole unproductive. Some parts of government are productive, such as infrastructure or health care (assuming a public health system), but the majority of it is not. Redistributive government programs do not produce anything, they just shuffle wealth around while destroying some of it in the process. The regulatory functions of government actively destroy wealth and hinder wealth creation. Not to mention that the taxes necessary to fund government discourage wealth creation. But the government keeps a lot of white-collar people employed.

Fourth, the military. The US has no real external threats and it’s military is vastly superior to anything else on the earth, but the military keeps a lot of people, particularly those people who may be inclined to organized violence, employed.

Fifth, the subsidized. the government subsidizes a lot of economic activity and organizations that would otherwise be unable to continue to exist.

I’m not saying that these were actively created because the people creating them knew we faced unemployment problems due to the transition to post-scarcity, but they do help keep the problem of unemployment in check.

****

So, what should I take from this?

It’s simple, the next few decades are going to be very painful economically. Our wealth will increase, so we’ll continually have more goods and services over time, but at the same time our unemployment will increase and GDP might not accurately reflect the increase in goods and services as post-scarcity resources (such as pirated music) will be outside official measures of wealth as they will not require economic transactions.

Economic inequality will likely continue to increase, as the productive capacity continues to rely on fewer people, while more people are replaced by technology and have less access to wealth.

As each industry faces it’s own movement into post-scarcity each will push it’s own form of blowback as they realize their profits and jobs are going to disappear as technology replaces them.

Together, these forces will create great societal tensions. Government redistribution will continue to grow to keep the lid on these tensions.

At some point though, we will reach the tipping point into post-scarcity. After this, work as we currently know it will no longer be a thing and society will rearrange itself to adapt to a totally new situation.

Lightning Round – 2012/05/01

Everybody enjoying May Day? I hope you are.

Did you know that the average person could be making $100,000 a year? The Captain does the math.

A great speech given to the Fed. Long, but read it.

“The president has a very difficult time with the business community. Most people in business and most people who are successful are Republican that’s just a fact of life.” I wonder why?

The system is hungry; it must eat. Poor Sweden.

Marriage is fundamental to the church: when it declines, so to does the church decline.

Related: Why Evangelical Princesses are un-marriageable; a great post from CMDN.

We won! Yay!?!???

How you create a mass-murderer: Teach him to hate himself, then act surprised when he externalizes that hate.

Becoming as weak as your foes doesn’t help you or them.

Shame the beta month; it looks like it could be interesting.

(ht/ SDA, AMN, CC)