teaser47401 said:
Money, free of national boundaries, seeks absolute advantage regardless of nationalistic concerns. … and while that stored labor (money) may move freely across international boarders, a country’s population cannot.
Again, you are applying
political policy to economic theory. Workers are somewhat immobile due, primarily, to political restrictions rather than economic law. Economic law suggests that coal producers will logically location themselves at an efficient distance from both the natural resources and the consumers. Economic law (and comparative advantage) only views political boundaries as additional encumbrances to trade. Furthermore, it recognizes that trade is ultimately conducted by
individuals only. Therefore,
all trade should be considered “foreign” trade.
What this means is that from the standpoint of comparative advantage, it makes little difference if a person lives across the street or across the globe; one person will have a competitive edge over another based on the various environmental and individual factors. The reason why the workforce tends to be immobile is due to political restrictions placed on the freedom of movement by individuals. The very basis of power for governments is their ability to restrict the status and movement of individuals. But this has nothing to do with economic theory; political restriction does not invalidate economic law.
teaser47401 said:
Advances in Science, Agriculture and Engineering have made it unnecessary for the entire population to work in order to fill the material needs of mankind. Comparative Advantage and in fact economic theory in general, is based on the assumption that more is better.
You are misunderstanding the concepts here. Yes, demand is “unbounded”. However, regardless of how advanced technology becomes, all demand will never be satisfied. As society has advanced, the ability to meet basic demands has become relatively simple. For many people around the world, the prospect of obtaining enough food and water for basic survival is not even a question. As lower order demands are met, humans are able to focus their attention on higher demands. I want a big house, a nice car, fancy clothes, luxurious vacations,
et cetera. These higher order demands can
never be satisfied. The amount of money in the world is not the limiting factor; the reason demand will never be satisfied is due to a scarcity of resources.
Because resources are scarce, businesses must not only determine
what consumers want, but they must determine
how much of it they want and how much they are
willing to pay for it. So your claim that “[t]he problem is no longer one of resource allocation” is absolutely wrong. Every single bubble, bust, and boom is the result of improper resource allocation. Consider the housing crash. Builders and investors assumed that people demanded more and more housing (which they probably did), but failed to consider the
other things people also desired. Prices are a rough approximation of how highly people demand certain goods.
So getting back to your claim, economics is not based on the idea that “more is better” so much as the idea that
demand is never satiated. There is a big difference. It is easy to confuse this endless desire for comfort with greed and materialism since those goods which derive comfort are generally physical and cost money. Which leads us to your next claim:
teaser47401 said:
The problem is no longer one of resource allocation. It is one of distribution and capitalism has no mechanism for distributing goods and services to those with nothing to barter.
I think you mean “nothing to
trade” since capitalism is a system based on a medium of exchange as opposed to a barter system based on goods in kind. No biggie.
There is an unfortunate (though understandable) desire to divide the economy into various classes. While it is certainly helpful during certain thought experiments to separate production from distribution, there is no economic difference between the two and they are indissoluble. Again, let us consider a simple hypothetical example.
While the availability of adequate food and water in America is, as a whole, plentiful and cheap, this is not the case in much of Africa. Why is this so? The level of unemployment in Africa ought to be more than enough to offset the unavailability of food and yet they continue to have food shortages. Nature has seen it fit to make much of the land in Africa not terribly suitable to agriculture. This means that they (again, as a whole) must concentrate on other areas in which they might have an advantage. Ignoring the unfortunate lack of adequate property rights and other political considerations for the moment, the sheer numbers of unemployed workers is the most immediate and obvious competitive advantage.
So let’s go back to the automotive industry. Roughly guessing, American auto workers probably make around $25-40 per hour depending on their job and experience. That could feed an
entire village in Africa! If Ford were to move its assembly plants to Africa, it could conceivably reduce the cost of a vehicle by half. This would have a number of effects. First and foremost, it would dramatically increase the well-being of Africans. The plant workers would have more money to spend on goods which would drive the local economies. Secondly, it would free up an enormous amount of money for American consumers who purchase new cars. This would allow them to focus on
other personal wants and needs of a more leisurely and luxurious nature, thus spurring innovation and expansion in these new industries. The displaced American workers could easily be relocated to the African plants in managerial capacities and/or assimilated into other industries.
teaser47401 said:
Capitalism will insure the best and the brightest are rewarded, but capitalism has no need for the rest of the population. The gap between the rich and the poor will continue to widen as the middle class is pushed up or down the economic ladder, with the vast majority being pushed down.
Capitalism has a “need” for every person on the planet. I see the poor and undeveloped areas of the world as a potential treasure trove of wealth. The reasons why there is such an enormous gap in wealth throughout the world is due to
political restriction. The issues are fascist in nature, not economic. If the artificial political barriers placed around geographic locations were to fall, the entire world would experience an enormous explosion of wealth and well-being.
teaser47401 said:
Eventually the unemployed populace of our nation will demand the government provide for their needs. America will become a welfare nation paid for by the few who give the unemployed just enough to stave off revolution. The result will be socialist America with its populace dependant on its government to meet their basic needs.
This is already the reality for America. Less than half of Americans contribute even a penny to income taxes and the continual issuance of nanny-state doctrine from Washington proves the overall consensus of Americans. They are lazy, scared, and stupid. America is home to the most well-armed slaves in the entire world. While the fascist rulers continue to distract the populace with the farce of choosing their own destiny, they sit back and allow the slaves to clamor for more chains to be lavished on their neighbors while their neighbors do the same. The result is one of the most oppressed nations in the world being filled with idiot who pretend they are free. Such a sad outcome.