When you say scarcity doesnt exist, you’re saying that scarcity as defined by some your debators? You’re in essence saying their definition is wrong when you say, “scarcity doesn’t exist”? If that’s not what you mean, please explain the statement and provide the defintion you’re using for scarcity. I know one alternative definition you provided was, ‘not abundant’. But ‘not abundant’ doesn’t mean 'doesn’t exist.
I think the premise of this is that there is no such thing as ownership. The business owner, you could say, is also consuming. He is buying the customers’ money. He is saying, “I want that 52 cents. Here’s a can of corn for it.” But you contend he owns nothing.
I’d like to know how Manhatten, if cut off from the rest of the world, can grow enough cotton, or raise enough sheep, to clothes 8 million people.
After that what about heating and transportation fuel?
What about electricity?
What about electronics to control the distribution of electrcity? and other resources?
What about computers? the making of which involves multi-billion dollar chip foundaries. How would a small town, or even a huge one with 8 million people, be able to afford that on their own without expectation to export chips?
etc. etc.
What you are describing is a society without specializations. Adam Smith debunked your theory three centuries ago.
Isn’t producing excess food the very definition of mis-allocation of capital? The very fact that there are residential and commercial use of land everywhere we see should be a hint that your statement is wrong.
That’s complete nonsense. If I hire a baby sitter, or some one to sit my house, so I can go see a movie or go on a vacation with my wife, what am I marketting? Nothing at all. Hiring labor is buying labor, or whatever you call it offered on the labor market.
“Where goods do not cross borders, troops will.” --Frederic Bastiat
Besides, what about the law of comparative advantage? The resources diverted by this intervention into agribusiness has to come from somewhere else in the economy, possibly where this locale has a comparative advantage over other locales. Under a complete market–not one with your euphemism of “minor protection”, but a free market with no intervention–people, corporations and locales will specialize for the ultimate benefit of everyone. The capital financing these great storage facilities may be diverted from capital otherwise used to finance IT companies, or universities, or factories, or something else that this locale has a better comparative advantage for, and would benefit the most people if this advantage were fully used.
You answered your own question, see below:
That’s the vernacular use of “demand” that I was referring to. A penniless beggar can ask for a loaf of bread; in the lingos of every day English, hungry people have a demand for food, regardless whether they can afford to pay or not.
Bingo! Even the very dictionary that you cite makes the distinction between vernacular every day use of the word “demand” vs. the proper word “demand” in Economics. At a given price point, Economic Supply always meet Economic Demand (both used as jargons in Economics) because “the power to purchase at a particular price” is the assumed qualifier; in other words, Scarcity is assumed as the basic nature of society in economics, without scarcity there wouldn’t be price. Without reference to the price point in Economics, demand from those asking for it always exceed those who are willing to supply it for any item that has a price tag (otherwise, why bother putting on a price tag? if everyone can get whatever he/she asks for).
So you’re saying he inefficiently employed capital, land, labor. He put more into it than he’s getting in return. So if a business wants labor services to bring about a certain good or service, but that labor service can only produce $5/hr in goods and services and the labor services on the markets are priced at $7/hr it would be inefficient to employ such services. But it’s not really him that’s buying said services, its the consumers. So he can employ them anyway. Why then, would you say, "it’s the farmers’ lot’?
Also, I propose that there is a better use for land - to stand. If there’s NO land, you’re hurtling thru space.
Resolved: Does ‘Food Security’ Require Protectionism?
If we need to secure our nation by keeping all our crops here and all ‘there’ crops out there because w/o crops we die, why don’t we just concoct a nourishing formula, w/ all the neccesary stuff for good health, and refridgerate it? If all our food suddenly disappeared because of going to larger market, we could pop the tops on our formulations and nourish ourselves until we regain our agricultural independence? Or maybe people can decide this for themselves. They can buy foods currently available, store them and have them in case of future catastrophic events. They can do this while free trading works to keep prices lower, thus allowing them to store even more food. So freer trade will allow them more security because it allows them to purchase more security e.g., canned black-eyed peas, sweet potatoes, corn, sardines, etc. So now we no longer need to hem ourselves in. We can be richer due to free trade, employ those riches for greater nourishment security and then ride on up Maslow’s pyramid of self-actualization.
Minimum wages raise the cost of a factor input, in turn causing price increases in the related products/services. Any gain enjoyed by those on the MW is offset by these price increases, as well as the unemployment caused by it. It is a price control, and has the predictable results one would have. I’d also read up on the entrepreneurial process if I were Arman (which he seems to conveniently ignore), and maybe even go see how businesses function.
Moreover, what is the point of many countries imposing tarrifs in tandem? Universally higher prices? How self-defeating.
ATTENTION Non-Armans:
Arman says, “It is the consumers that are actually purchasing the labor service, not the business.”
When a business is in the market, what is he doing? If he is selling corn, he is buying money, ie a roundabout barter.
Consumer A says: I will give you 52 cents for that corn.
Consumer B says: I will give you corn for that 52 cents.
It’s a mutually benefitting transaction.
If the business owner can purchase 52 cents with corn, can he be said to be a consumer? If he can be said to be a consumer, would Arman’s economic truth contradict his assertion:
It’s as though the business operator doesn’t exist. He’s merely some sort of manifestation of the actions of others, having no input. Sounds like errors in thought can be dangerous and can actually lead to stuff like communism, even if this consequence is unintended. Ideas matter.
“The employers don’t buy the labor, but market the labor. It is not a cost to the business, but more of a debit against sales income. In the macro, the more money spent on labor, the more money in the consumers (laborers) hands, and it is the consumers that are actually purchasing the labor service, not the business.”
Please take accounting 101, because this is not how employers put it in their books. Their wage account is not paid out through their revenue account. In a T account, we would credit Cash, and debit wages payable. But as you said, wages are not a cost of doing business. So businesses never have to worry how much they pay their employers then…is that it? So then why have you said raising wages to $100 an hour is a bad idea? I mean, employers do not buy labor.
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As defined in the dictionary. “1.insufficient to satisfy the need or demand; not abundant:” The debaters here want it to mean ‘limited’. JimS wants demand to mean ‘want’. The words I use are defined in the dictionary. Stating that I must mean something different to use those words is just defusing debate by confusing debate.
I mean that there is no demand in excess of supply, or no supply short of demand. They started arguing that the scarcity they mean is not the scarcity that I mean, but then when I reword it like this, they refuse to let go of the stupid semantic argument.
To get the quote in context, hit the “in reply to” at the top right of the box. It brings you to the post being replied to.
The business entity buys only in expectation of selling. The consumer buys with no intention of selling. The consumer is the end user of everything. The business is only the the consumer’s gopher.
My ideas come from me. I started in business college 33 years ago. Started getting over it some 23 years ago.
I used to think that there would be some extremely short termed displacement, but when so 4 or 5 states put in a 33% hike last January, I looked for some displaced to get information on how long the transition pains might be. I could not find anyone on facebook that could tell me of their personal layoff. The only short term pain I found was one girl who expected a raise in February, and instead got a smaller raise with the minimum wage.
Can a business entity be a buyer? Can they be a seller as well? Can consumers switch roles as well? Or can you not switch rolls in transactions?
From the very dictionary you cited, “demand” means:
"–verb (used without object)
| 5. | to make a demand; inquire; ask. |
|---|
–noun
| 6. | the act of demanding." |
|---|
or
"Economics
| 9. a. | the desire to purchase, coupled with the power to do so. |
|---|
| b. | the quantity of goods that buyers will take at a particular price." |
|---|
So, which one is it? If you want to use definition (5) and (6), i.e. the act of “asking,” then there isn’t nearly enough goods to satisfy all demands, so everything that normally has a price is indeed scarce, which is defined as “less than the demand.”
If you want to go by Economics, where (price qualified) demand always equal (price qualifed) supply, then Economis has scarcity as its presumption when both “supply” and “demand” are qualified “at a particular price.”
I do not believe even in newspapers, that this would be a good source of a “poll” to see an effect of a policy has on the public as a whole. I mean, if it were up to the internet to represent the population, Ron Paul(just telling the truth here guys) should be leading in delegates and winning every state. But this isn’t true. You will need to provide us another form of evidence besides your own observation that shows that the states that have put in a 33% hike hasn’t caused any problems in the economy. I say in Illinois, from my own observation, that things have gotten worse. Jobs are harder to find, and prices of goods around the state have increased.
Not all businesses are resellers . . . especially when it comes to labor. Only temp agencies are resellers of of labor. Practically all other businesses cosume labor as an input factor. Is a pizza shop a reseller of flour or labor? No, it’s a manufacturer of pizza, with both flour and labor as input factors.
Good grief, is facebook now a reliable statistic tool? Most people making minimum wage don’t have the luxury of making face book videos. For what it’s worth, you are committing the classic error of the seen vs. the unseen. The next time you see an empty stall in the mall, you will know minimum wage is a contributing factor; the next time you hear unemployment, you will know minimum wage is a contributing factor.
If there is sufficient food, the market will take care of all the rest. That you cannot conceive of it is no matter at all. The specializations needed are there, and as always, are underutilized. There is no scarcity.
Isn’t producing excess food the very definition of mis-allocation of capital? <
In your propaganda, but there is always excess food. Ever check the dumpster at a restaurant? Or the supermarket? Excess food means that the food just off the highest quality goes to the dumpster. Were you not taught, that economic developement began with agriculture?
If I hire a baby sitter, or some one to sit my house, so I can go see a movie or go on a vacation with my wife, what am I marketting? <
You are not a business, but a consumer. In effect, the sitter is self employed.
Besides, what about the law of comparative advantage?<
Once you realize that there is no demand in excess of supply, this theory becomes moot.
Under a complete market–not one with your euphemism of “minor protection”, but a free market with no intervention–people, corporations and locales will specialize for the ultimate benefit of everyone.<
By your faith alone.
All businesses are resellers; if not with specific labor service, then with the product of labor.
No, but it is a source contact of a large cross section of youth (people on entry level wage) that has never been available before. I expected to find a few effected. I was indeed disappointed.
The business entity is not a consumer. The business is staffed by consumers, the business is owned by consumers, but the business is not a consumer.
Do you have any idea how many acres it takes to grow enough cotton to clothes 8 million people? or for that matter feed 8 million people? More than the entire land mass of Manhatten. Until you can get food and clothing without having to pay anything, and get as much as you want, there is scarcity. I see that you are latching onto “if there is sufficient food” as your new magic black box. The reality is that, without trade, most towns in the US do not have sufficient amount of food to feed everyone in town, and can’t possibly produce enough locally. The same goes with clothing, shelter, and myriads of more complicated economic specializations. Frankly, your whole argument is quite insane: since it’s impossible for a town of 5000 people to sustain a $500 million auto plant without expectations of exporting cars, the local transportation specialization would have to be built around horse buggies, therefore horse buggies must be just as good as cars. That’s the essence of your argument.
In case it’s not obvious, sending food to the dumpster (regardless at a restaurant or at a supermarket) is indeed mis-allocation of capital. When you buy too much food, and they rot in your fridge, then you have to dump them, it’s mis-allocation of capital. The solution to that mis-allocation is not buying more food 
Economics began probably before agriculture. My guess is that economics began when a woman traded some berry with a man who caught a rat or frog . . . then even the service industry was born before agriculture: as sex was traded for protection. Agriculture probably wasn’t born until beer was discovered; it was just too much hassle to gather and tend poor strains of grass seeds over months . . . something intoxicating had to be the final reward for such long term endeavor.
The sitter is a household employee if you get to tell her how to do the sitting. In any case, would a sitter for a business be any different? Like cook at a pizza shop?
Once again you are confusing price-qualified Economic “demand/supply” with the vernacular sense of the words. Demand and supply equal each other only at a given price point. The whole point of the law of comparative advantage means the trade-off’s in producing different kinds of goods are different in different locations.