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Economic fallacy of the day

“We are not gods. We cannot create wealth out of thin air. Western wealth is just a function of colonialism or, in its current form, neo-liberalism – of taking resources from countries like Ethiopia. Neo-liberals then try to justify this by pretending that they have ‘created’ the wealth they have.”
Left-thinker

41 comments to Economic fallacy of the day

  • Yes, we are cynically exploiting the proletarian masses of Ethiopia, enriching ourselves on the…well, there’s the…and, of course there always the…be that as it may, I’m sure we’re exploiting Ethiopia somehow. The United States could not be as rich as it is today without exploiting to the nth degree whatever it is that Ethiopia has in abundance and denying poor Ethiopians the use of whatever it is we are denying them the use of. Ethiopia is a cornucopia of something or other, and the sooner the West stops its exploitation of whatever it is they’re exploiting in Ethiopia the sooner the Ethiopians can use it, whatever it is, unless it, whatever it is, damages the environment or puts some endangered species of water fowl out of joint, in which case the Ethiopians cannot expoit whatever it is the West is expoiting now because that would be environmental exploitation and environmental exploitation is wrong, even if it means Ethiopians have to starve to death by the tens of thousands and listen to that damn Geldof song because of it, the it in this case being environmental exploitation and not the it the Ethiopians want to use and exploit, whatever it is. Okay, now I’m confused, too.

  • And apropos, absolutely nothing at all, today is the 60th anniversary of the beginning of the Battle of the Bulge.

  • Hilarious! Someone who actually believes in the fixed wealth fallacy and thus thinks for one person to get rich, someone else has to get poor… People were malnourished in almost every nation on earth in 1904, so how does such a twit explain the simple fact that less people are starving globally in spite of rising populations than, say, 100 years ago if wealth is not created but merely ‘distributed? Given that hundreds of millions of people ion the ‘first’ and ‘second’ world are richer than at any time in human history, by the logic of Left-‘Thinker’ there must be more utterly destitute people overall than ever before. Truly a preposterous view of how the world really is.

    …and never mind that a miserable agricultural economy like Ethiopia does not have anything worth ‘plundering’ in the first place.

  • We are lucky sods. We can create ideas out of thin air. Western wealth is just a function of colonic irrigation or, in its current form, free trade – of taking comparative disadvantages in countries like the US and allowing them to be exploited them in sales of coffee from countries like Ethiopia. Neo-liberals then try to justify this by pretending that they have ‘created’ the wealth they have. And they have.

  • I always try to start an explanation of economics to teenagers by pointing out that wealth can be created literally, by banging rocks together. Google “flint knapping”. Sell the product at a roadside stand. Make money from banging rocks together.

  • Western wealth is just a function of colonic irrigation

    Giles, I think I have an uncle who had colonic irrigation done to him at the hospital. He’s fine now, but walks a bit funny!

  • Verity

    Left thinker who made the naive comment that we’re not gods: well, actually, we are gods. Because we can create wealth out of thin air. The entire human race has created wealth out of thin air. That is our magic. The new French bridge at Millau was created by human minds and other humans who put in the capital to create a service which the French and visitors to France will gladly pay for thereby creating more wealth.

    Why can’t these people just reread their PJ O’Rourke?

  • bago

    You’d think that software would be a simple way of pointing to wealth that didn’t come from Ethiopia.

    You spend months and months arranging the magnetic stripes on a disk to suit your fancy and then you sell the finished pattern for money. Some patterns are more valuable than others, but in the end it’s just a pattern of stripes that has value, where none existed before.

  • veryretired

    Arkakey—fabulous—I started laughing and startled the rest of the family who were watching some murder mystery.

    Notice the implicit logic in the quoted statement—if wealth was not really created by someone, but stolen, then it is perfectly correct and moral to take it away from the undeserving “rich” and give it back to the more rightful claimant, that being whatever victim group has been adopted this week by the collectivist compassion industry.

    It is upon such spurious foundations that the edifice of wealth transfer is built.

    It would be interesting to watch left thinker try to explain to some truck driver from Topeka why his wages have to be taxed at a higher rate because he made too much working overtime, trying to get some extra money to buy his family a few treats for Christmas.

  • zmollusc

    The flint knapping theory of wealth creation is laughably simplistic. Where is the manager to deduct pay if the flint knapper arrives at the flintpile late, and to encourage the flintknapper to work late? Where is the inspector who, while unable to knap flints himself, is paid more highly to check the flints are knapped to the right size since the knapper hasn’t time to do this himself? Where is the marketing department? Where is the boardroom meeting to decide to outsource the work to chinese flint knappers?
    Wealth creation is a team effort. Without a proper team, the solo flint knapper will create very little wealth. He may as well be living in the stone age.

  • Johnathan Pearce

    Lefthinker has to explain why, in Africa, a continent with amazingly large amounts of mineral wealth, most of the locals do not have a pot to piss in, while in places like Hong Kong, in which folk do not even have their own water supply, income per head is so high. Also a question to put to these dolts, is, how did a rich nation get to acquire the means to “exploit” such places like Ethiopia in the first place?

    I knew that parts of the left were intellectually bankrupt, but this is rather sad.

  • Pavel

    Oh, my G-d. How can anyone believe nonsense like that?! Of course people can create value out of nothing. Thousands of examples are readily available. This way of thinking is beyond my understanding.

  • Robert

    You’re all missing the point. The point is that someone needs to think of the children.

    Why won’t you think of the children?!?

    *Sob*

  • “And we’ll be sending a big HELLO! to all the intelligent life forms in the galaxy, and as for the rest of you, the secret is to bang the rocks together, guys!” — Douglas Adams

    Some people just won’t listen.

  • Stehpinkeln

    “I always try to start an explanation of economics to teenagers by pointing out that wealth can be created literally, by banging rocks together. Google “flint knapping”. Sell the product at a roadside stand. Make money from banging rocks together.”

    What a great idea! Do you think it will work with neo-liberal heads? Same basic principal. Same basic substance.
    Might make more money if we let the customer do the banging. Sort of like Wack-a-mole. Wait, will that fall afoul of the DIY laws in England? Is there a government office that protects the liberal wacking union? Is there a Liberal wacking union? If not someone should start one. Lots of money in Unions, just ask Jimmy Hoffa. Hr’s around here someplace.

  • Stehpinkeln

    886″I always try to start an explanation of economics to teenagers by pointing out that wealth can be created literally, by banging rocks together. Google “flint knapping”. Sell the product at a roadside stand. Make money from banging rocks together.”

    What a great idea! Do you think it will work with neo-liberal heads? Same basic principal. Same basic substance.
    Might make more money if we let the customer do the banging. Sort of like Wack-a-mole. Wait, will that fall afoul of the DIY laws in England? Is there a government office that protects the liberal wacking union? Is there a Liberal wacking union? If not someone should start one. Lots of money in Unions, just ask Jimmy Hoffa. He’s around here someplace.

  • Stehpinkeln

    Sorry about that. Bad finger technique causes double taps.

  • waterbutt

    Hmmm…..all this left and right is a tad narrowminded, why limit yourselves?

  • Chris Goodman

    Leftism is not an economic theory. The Left do not believe that there is a fixed amount of wealth. Such claims are no more than a rhetorical device to justify confiscation. Although in practice Leftism is a job creation scheme for Leftists, what motivates the Left is not the ambition of becoming a parasite, nor is it the pleasure of deciding who should be rewarded; it is DESTRUCTION that excites them. The Left is 98% malice.

  • vindavent

    For the record. No, we are no gods. No, wealth is not created out of thin air, and yes, Leftist is still wrong. Wealth creation is the result of labour. If labour becomes more effective, through the use of improved technology (an increase in labour productivity), wealth increases quicker than population growth. Developing countries could literally sink into the ocean, without this having much effects on industrial economies. However, all this does not exclude that ethiopian children could actually be aided by *some* redistribution (read: charity) and a non-intrusive (liberal) foreign policy by rich countries.

  • waterbutt

    As I said, what’s all this about “Left” and “Right”…life isn’t that simple and it does make one sound rabid and dogmatic. Leftism is an album by Leftfield, nothing else.
    Wealth is not money, a doctor or a nurse a teacher or a carer; they are wealth creators as opposed to those involved in usury are not, they have no benefit to the human race. Now, am I to be branded Left or Right?

  • Verity

    Amen to what Chris Goodman said. The left is sheer malice.

  • Tom

    Hippie: “Hey man, you can’t OWN property”

    Dr. Farnsworth: “I can, but then I’m not a penniless hippy!”

    Can I gather that this theory is behind the delusional leftist rant that “property is theft”?

  • If the Left doesn’t believe that wealth is finite, they sure as hell ACT like they do.

    Estate taxes, taxes on profits, sales taxes, value-added taxes… I could go on and on.

  • By the way, the “flint-knapping” example is partially fallacious, unless you own the land on which the rocks are to be found.

    Otherwise, you’d either have to steal the rocks from the landowner (maybe that’s what we’re stealing from Ethiopia, because they don’t have much else to export other than Ethiopians).

    Or else, of course, you could pay the landowner a commission on sales of flint, for the raw materials he provided.

    Oh hell, there I go, talking like a capitalist again…

  • Property isn’t theft…but taxes sure as hell are!

  • I must declare solidarity with my Ethiopian brothers and Sisters and the Transgendered.
    It is utterly disgraceful that the Western Imperialist exploiters are stealing Ethiopia’s main natural resource,Famine.Oh it is all right saying that you are paying the World market price for famine,but you are taking Famine from the poor and giving it to the rich.
    I have it on good authority that the overfed and obese of the West are using Famine in place of the Atkins diet,this is nothing but neo-colonic exploitation.

    We at the Flint Knappers and Qwernmasons Union resent the implication that anyone can undertake this highly skilled trade without proper training and wage differentials.It is an insult to organised labour.

    Ron Brick
    Chair of the FKQU Famine for the Ethiopians Committee

  • There’s good money in stealing famine from Ethiopians and selling it to the rich. Have you seen what some of those fancy diet programs cost?

    Do you suppose the Ethiopians are getting any residuals?

  • Stehpinkeln

    Ah yes, the Ethopian Diet. Look out Bill Gates.

  • toolkien

    Obviously the material world is fixed. Using a resource for purpose X removes its us for every other use. Leftists don’t have a problem using resources, though they sometimes seem to think them unlimited and that that which is produced needs to be allocated exactly in the same proportion, and the only way to do that is to have ‘no one’ own means of production. I suppose that is what the quoted individual was driving at, the inability to comprehend why those who live on a pile of resources, and who may assist in their extraction, do not seem to benefit proportionately. The part of the equation that leftists continue leave out, from Marx forward, is the multiple values asignable to any particular resource, and that its maximum use is found through market forces, i.e. the meeting point of various value systems inate within each individual into one material world. More than likely the source of the perceived misallocation has more to do with imperfect methods of valuation by the people in the ‘exploited’ region and the refusal to join in pure, or nearly pure, markets but rather choose to continue with some proto-collectivist culture.

  • Thomas

    1. What does not being a god have to do with creating wealth?
    2. If one can only acquire wealth by stealing it, then where did this “wealth” come from in the first place?
    3. Are “resources” only found in third world coountries, like Ethiopia?
    4. Is Left-thinker defining the word “resources” as strictly “tangibles”, like metal ores and such?
    5. Is not human “work” and “thought” a resource? If not, then how do we take the tangible resource out of the ground?

    “Wealth” IS “production”, be it tangible or not. Wealth is created from “work”. Even if sometimes the “work” seems effortless. This left-thinker has no economic learning at all. He’s probably a Marxist. No, even Marx was smarter than this guy. I can’t even classify this drivel!

  • James

    …but neo-colonic exploitation.

    That’s funny on so many different levels.

  • I'm suffering for my art

    Good grief, I thought that the “fixed wealth fallacy” was an urban legend perpetrated by well-meaning, like-minded folk using dubious methods to discredit those on the left. However, here is a concrete example! What curmudgeons these people are. Still, it’s always fun to watch them air their ill-considered opinions.

  • I'm suffering for my art

    I just re-read the quote. I’m convinced we’ve all been had. Left-thinker is clearly a urine-taker; their nickname is the major giveaway. This dude’s probably laughing fit to burst, with all the comment and fluster s/he’s made us resort to.

  • Jake Walters

    Both wealth and resources are not fixed so long as we dont allow them to be. However both are limited by the level of efficiency and inventiveness in their creation and extraction. Wealth DOES NOT come from thin air, All of our physical riches are made from something limited and tangible.. as vindavent said above, we are indeed not gods. However what we can be, is incredibly ingenious at extracting ever larger amounts of goods and wealth from a scarce or shrinking pile of resources. This is best done through the free market. For example, although the total supply of copper on this earth is of a fixed amount when un-neededed by utility; through the price mechanism, increasing demand, and the ingeneuity caused by pressure from these two factors, the supply of copper is for all practical purposes nearly limitless. Julian Simon refutes fixed wealth with amazing accuracy and detail in his book “The ultimate resource”. Morons like the leftie that wrote the nonsense in the post would do well to read such a book.
    Jake

  • Sylvain Galineau

    Wealth is not created out of thin air ?

    I don’t know. My last cell phone bill says Cingular Wireless is coining quite a bit out of the airwaves.

    They should be expropriated at once and their unethical, unnatural profits redistributed to the people !

  • Dishman

    I looked at my own expenditures…
    The four biggest expenses are:
    1) Use of land (in the US, at a certain location)
    2) Taxes
    3) Intellectual Property licenses/fees/etc.
    4) Food

    Land expenses are a feature of the California housing market. IP comes in many forms, including the creation of DVDs, software (tools and games), computer hardware. Actual consumed resources don’t show up until #4. Most of those come from local sources.
    My sensation of wealth, though, comes from my ability to spend on item #3. There is a resource component associated with them, but it’s negligible compared to the total cost.

  • jon

    Of course the left isn’t an economic theory. But here in the US, I can’t figure out what the right stands for. Those huge deficits, huge debts, huge tax cuts, and huge amounts of spending aren’t exactly something to salute as the GOP flag is raised. They’ve identified a Social Security crisis and proposed a half-assed move toward privatization to fix that upcoming (latest prediction: 2042) budget shortfall. Of course, they haven’t proposed any solution to the upcoming budgetary shortfall to Medicare (latest prediction: the incredibly-far off 2009), since that must be, to use the President’s own words, “hard work”.

    As angry as I get with Democrats and the hippie-doofuses on the left, I really have to take two aspirin before I start to wonder about the governing fitness of the Republicans and their no-think tanks on the right.

  • Rollo

    Well said Jon. Of course elements of the left are traditionally easy targets when it comes to economic naivete. However, so are elements of the right. You simply cannot dumb down economic policy to a simple “right-left” set of arguments.

  • jon

    Au contraire! It is much too easy to dumb down economic policy along left-right sets of arguments. And both sides have mastered the art, so nothing is left but dumbed-down economic theories that are barely able to do the job of justifying the political policies of each party. I’d wish for a pox on both their houses, but they’re already carriers.

  • N. O'Brain

    Don’t the Ethiopians raise sand?