Thoughts On Economics

WTF Happened In 1971?: This site has a lot of graphs and metrics that changed radically after 1971, the same year that the US ended the gold standard.

If all taxes are replaced by taxes on natural resources, would a head tax still be reasonable for distributing government influence?

We do support head taxes since they help solve game-theoretical problems.

• Scenario 1: No head tax for equally distributing influence over the government is needed to distribute influence over the government. This could happen if it is the case that: although land-renters are the only revenue generating demographic, their greater influence over the government comes at the cost of having to pay higher taxes to the government. In the current non-Georgist world, rich people will do whatever they can to avoid paying taxes while retaining their strong influence over the government. In a Georgist world however, rich people may not be so keen to have that strong influence if it means that they must pay the highest taxes for all of the high-value land that they are renting. If that turns out to be the case, then everything works out fine, and there are no problems that could arise from this concern.
  • In a way, everybody would be paying taxes in an economy that exclusively taxes natural resources to an extent, since all the prices in the economy would depend on the appraisal of natural resources.
• Scenario 2: If it can be proven that land renters are able to pass at least some portion of the LVT onto tenants, then the tenants would be indirectly paying LVT anyway, and thus they would already be paying for the government’s services to an extent via that indirect manner. But if this is the case, then it would have to be calculated and verified regarding exactly what percentage of LVT is able to get passed onto tenants for all the various ways that land can be used (housing, farming, etc).
  • The head tax would guarantee that not all of government revenue is exclusively made from people renting land and purchases on government-owned/managed natural resources. It can be argued that this would be a good thing because non-land renters are still using at least some government services, so it could also be unfair for them to receive them without paying anything at all. Additionally, one of two scenarios could occur if one voting demographic has more power than the other (land-renters versus non-land-renters):
• Scenario 3: The land renters have the most power since they pay nearly all the government revenue.
  • A head tax would limit land renters’ ability to have a monopoly of influence over the government (since they would be the only revenue generators, aside from people revenues generated by the government selling natural resources). The head tax would distribute influence more equally over the populace, thus limiting the power of the land renters to how ever much the head tax rate is.
• Scenario 4: The people have the most influence over the government because they are the majority and the bulk of the democratic populace and voting block:
  • People who are not land renters would be less incentivized to demand maximum government services since they wouldn’t be free to those people and would affect non-land-renters to at least some extent via the head tax rate.

Lots of people have kids who can’t afford it. Lots of people who can afford it don’t have kids. These facts are both true, but it’s also true that increasing the amount of wealth in society would increase the birth rate of responsible parents. Hence, a stronger economy would encourage more eugenic fertility. A stronger economy would also have positive and negative effects on eugenics. It would eugenic by: 1. increasing the birth rate of responsible parents, and 2. possibly placing higher selectionary pressures on humans who are more knowledgeable, enabling knowledge to be more easily spread, etc. It could also be dysgenic by: making it easier or even encouraging for dysgenic parents to have more children.

A stronger economy could have greater resource consumption, especially if it was consuming resources as inefficiently as the current society does. On the other hand, a stronger economy could have lower resource consumption, particularly if it has a Georgist approach to taxation and natural resources.

Cases Where Non-Profits Outperformed For-Profit Entities

• FOSS Software: The GNU Project, which created gcc (GNU Compiler collection), Linux, git, VLC, audacity, GIMP, Bitwarden, Firefox, e
• Non-Profit colleges outperform for-profit colleges by every measures: affordability, quality, etc.
• The pioneering of the GEDCOM file formats and software by the Mormon Church.
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Most people know the importance of negotiating one’s starting salary at a job interview. If you argue for a salary that’s too low, then you’re undercutting yourself, especially if the employer has to meet you halfway. Likewise, arguing for a salary that is too unrealistically high may also leave a bad impression on the employer or cause you to forfeit the job offer. Alternatively, we could also view this from the employer’s perspective of wanting to pay prospective employees as little as possible. Regardless, it’s not easy for either party to get the exact salary that they want. From the employee’s perspective, some good strategies may be to give a salary range where the lower end is close to the average salary for the position, with the rest of the range leaving some buffer room for a higher salary negotiation.

A comparable scenario is arguing for tax cuts or drastic reductions to mass immigration. If you want to reduce immigration, and you know that a political compromise must happen between the pro-immigration and anti-immigration parties, then arguing to reduce immigration by what most people would view as acceptable could backfire if the pro-immigration parties make you meet them halfway. If you know that immigration can only be reduced by a fraction of what we really want once the compromise happens, then it might more sense to make more extreme demands, so that the other party will try to meet you halfway. The same goes for arguing for tax cuts.

In such a scenario, it’s also probably inevitable that there’s going to be both: 1. a faction that wants to moderately reduce immigration, and 2. a faction that wants to drastically reduce immigration anyway. In this case, I would argue that it’s a good thing to have both factions, not just one. One could campaign for the more extreme immigration reduction camp, and fall back on the more moderate camp if the demands are too extreme to be accepted by the rest of the public. On the other hand, if: 1. we make more extreme calls to reduce immigration and the extreme camp has a substantial amount of support, and 2. the leftists have to compromise with us, then the compromise will have to be closer to the anti-immigrant side, since the compromise would have to meet both sides halfway, by definition.

In a basic thought experiment, one might think that paying people less would cost them to work less. If you think about it, someone who is paid only one dollar an hour is not going to be incentivized to work as much as paying him say, seven dollars an hour. And as with everything else, we know that taxing some things will encourage things to be used less. Just like how income tax causes people to want to work less, how sales tax makes people want to buy things less, how land value tax makes people want to own less land, etc. So one should think that from this experiment, it should be implied that paying people more and giving workers raises after they have worked for a certain amount of time and got a lot of experience, that they would be motivated to work more. But this isn’t completely true.

In another thought experiment, we can recognize that if some people got paid say, $1000 an hour, then eventually they could work enough hours to the point where they would not even need the job anymore. Some people only want to gain financial independence early in life, so they can retire early enjoy the rest of their life. This suggests that paying people more will not always incentivize people to work more. Sometimes paying people more can incentivize people to work less.

These two thought experiments suggest that there may be a soft spot or a soft range for paying people that will cause them to work the greatest number of hours. We can also connect this thinking to some form of planned obsolescence, where the worker is dependent on the employer for a wage, and hence work for that employer to get said wage. The worker is dependent on the employer. This dependency relationship gives the employer leverage over the employee, assuming that there are enough employees for the employee to choose from, such that they don’t have to worry about the employee trying to assert themselves further needs and wants.

Also see: How To Go To War With Your Employer - Drew DeVault

To a great extent, I’d argue that planned obsolescence is one of the most powerful, asymmetrical relationships that a supplier or service provider can have against their recipients because it causes the recipients to be dependent on them. Planned obsolescence deprives consumers of autonomy and independence.

• The most widely recognized form (Classic Planned Obsolescence) is when corporations intentionally produce inferior products that need to be replaced in the future. Examples:
  • The Real Reason McDonalds Ice Cream Machines Are Always Broken.
  • In March 2019, Google deliberately made Google Search less efficient to increase the number of queries (and ad revenue) sent to its search engine.
• Some medical professionals may deliberately give their patients less effective treatments, so that they will have to keep coming back and paying more money to get their problems fixed. In a way, this is a similar phenomenon to planned obsolescence because there’s more money in treating a disease than curing it.
  • For example, many doctors recommend freezing warts instead of rubbing a banana peel on the warts (which is extremely cheap and far more effective). This is an example of the planned obsolescence phenomenon, generalized to things beyond just products, like services.
  • As another example, it’s likely that orthotropics is a better and less expensive alternative to orthodontics since it addresses the causes of malocclusions, rather than the symptoms. And yet, orthodontics remains more popular because it has compromised academia and captured most dental institutions.
  • As a third example, some dentists over-treat their patients and will fill areas with fillings if they notice something that is the slightest bit off even if it doesn’t really need to be filled, since they get more money ever time they replace a cavity with a filling.
• Political Planned Obsolescence is when politicians don’t solve a problem once and for all, because if the problem doesn’t exist anymore, then people might/probably/will stop voting for said politicians. But for as long as the problem continues to exist in some form, people are incentivized to vote for politicians who they think will do something about it (even if they actually don’t).
• Military Planned Obsolescence is when the military creates unnecessary wars for the country to fight, so that the government will have to buy more equipment, weapons, vehicles, etc from the Military Industrial Complex to fight said wars.
• Academic Research Planned Obsolescence: Dismissing the best solutions to our problems or fabricated fake ideas instead of exposing the real ideas, so that there will be an ever-lasting flow of academic research.
  • Examples: Dismissing the importance of Georgism and genetic potential in understanding what really causes economic inequality, dismissing the importance of biology, race, sex, game theory, etc for understanding real-world problems, etc.
• When workers demand that their jobs not be automated or replaced with something/someone more efficient, that should be considered a form of this more generalized Planned Obsolescence that I’m thinking about, where if a more efficient solution was provided, the less efficient solutions would no longer be needed anymore.
  • Consider how Milton Friedman gave the example of some shovel diggers who asked/lobbied to keep their jobs instead of getting it replaced by a much more efficient machine, and it was pointed out that giving them all spoons to dig with instead would create even more jobs, if the goal was to just create jobs.
    • With this being said, the argument that laws preventing planned obsolescence would destroy jobs is a terrible argument for defending planned obsolescence. Our goal should be to produce the greatest amount of wealth possible, not to preserve jobs.

Question: Is there a better and more intuitively descriptive term that we could use to describe the general characteristic that all of these phenomena have in common, and all the different phenomena collectively as a whole?

• Constant Withholding?
• Planned Obsolescence?
• Constant Unnecessary Need?
• Constant Dependent Need?
• Inefficient Dependent Relationship?
• Manufactured Need?
• Artificially Manufactured Need?
• Inefficient Dependency?
• Manufactured Dependency?
• Dependent Relationship?

The right-to-repair is enormously important for preventing planned obsolescence in many cases, and it is best guaranteed by government regulations.

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Related: Only Use Old Computers - Luke Smith

[I haven’t finished writing this section yet. It takes time to write stuff.]

If UBI is funded without LVT, it would have to vary depending on location, and production will plummet, among other problems.

COLA: Cost-of-Living Adjustment

LVT would eliminate the question whether UBI would increase rent or not. It is a proven economic theorem that Land Value Taxes cannot be passed onto the tenants. LVT would not punish landlords for building more housing, so the end result is that rents go down since property taxes are eliminated. Rents would decrease even further as the supply of housing increases since landlords would be incentivized to build more housing, since they could build as much housing as they like without worrying about increasing tax rates.

Since Land Value Tax would decrease the cost of rent, the cost of living would vary less by location because housing would become more affordable regardless of whether it’s a city or a rural area. This means that it wouldn’t be as necessary to provide differing UBIs depending on the recipient’s place of residence and the associated COLAs.

UBI would offer people more liquidity to move out of a high-rent area into a lower-rent area since it costs money to move from one place to another, especially if they’re living paycheck to paycheck and would have to take a few days off work in order to move all their belongings into a low-rent area. In theory, UBI would eliminate the need for them to take out a loan in order to afford to move out of their high-rent apartments and what not.

Funding UBI with NRT would also reduce the decrease in production that UBI would cause, since natural resources taxes do not punish people for doing labor.

If UBI is ever going to work, then it needs to be funded by Natural Resources Tax, and there needs to be Population Control in place, lest it will only accelerate the collapse of modern civilization.

UBI would reduce the disincentive for welfare recipients to work, but it would create a much broader disincentive to work. There are many people who would choose not to work, or choose to work less, if they received a free basic income.

This is true, but the people who do choose to work less would tend to be the less productive and least hard-working people in the society, so a UBI might discourage production less than we would think.

A UBI for say, $1000/month would have to come from somewhere, either from taxation or money printing. The person who imagined that he would be $1000 richer might find himself $1000 poorer in actual spending power.

• If UBI is funded by Natural Resource Tax, the GDP of the economy won’t be reduced by taxes since NRT doesn’t tax production.
  • However, UBI would still make the economy less productive because it would reduce the incentive for all individuals to work.
• Inflation is unlikely since no new money would be printed to fund the UBI.

Different UBIs would be needed to adjust for different costs of living at different locations.

• Georgism would make living in cities more affordable by encouraging landlords to build more (dense) housing. They wouldn’t have to pay property taxes, and NRT couldn’t be passed onto the tenants, so a Georgist UBI faces less consequences that a non-Georgist UBI faces.
  • The cost of living varies greatly by location, so a UBI in Manhattan may not be the same as a UBI received in the rural Western states.
  • When Georgism makes housing more affordable in both cities and rural areas, there is much less of a need to provide differing UBIs depending on the recipient’s place of residence.
• If a reproductive license and tax are required to have children, society would need less welfare in general, and this would leave one less thing for UBI to potentially exacerbate or fail to fix.

Proponents of UBI claim that people would be more free to pursue creative and intellectual endeavors if they were able to work less, but this ignores how we may have already surpassed Peak Idea Production: Why We Are Running Out Of Good Ideas. Since there is probably only a finite amount of new ideas that can be conceived in this world, this is a good point for arguing that UBI wouldn’t do much to improve society.

If there is a surplus of government revenue after all NRT is collected, then we may need to find better ways to spend the excess revenue than UBI.

• The most basic functions of government: law enforcement, court system, military, border patrol, coast guard, foreign affairs, fire departments, emergency services, etc
• Hard infrastructure: roads, railways, bridges, tunnels, water supply, sewers, electrical grids, and telecommunications (including Internet connectivity and broadband access).
• Soft infrastructure: educational programs, official statistics, parks and recreational facilities, etc.
• K-12 Education?
• Single-Payer Healthcare?
• Singapore’s Welfare System, plus some amount of LBD?
• Laborers’ Bonus Dividend (LBD)?: Laborers who work are paid NRT by the government for working. A percentage of the worker’s salary (as determined by the government) is paid in addition to whatever the worker is paid by the employer.
• A Genius’s Basic Income?: A proposal to free our best minds from the tedium of daily life.

Head Taxes are the opposite of UBI. Head taxes require every citizen to pay the same amount of tax to the government, regardless of income. A society cannot have both a head tax and a UBI because the two would just cancel each other out. Given the potential negative effects of UBI and how head taxes help to prevent free-rider problems, it may be more practical for a society to have a head tax instead of a UBI.