beagle9
Diamond Member
- Nov 28, 2011
- 44,178
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A large set of false premises and assumptions.
1. All people are greedy and seek every opportunity to profit at the expense of another.
2 The richer someone is, the greedier they are.
3. There are two choices on business ownership: Innocent beatific government or corrupt greedy capitalists.
4. The Government always has everyone's best interest at heart.
5. When people of similar industry or wealth get together, they conspire against the rest.
6. The only way to profit and grow wealth is by stealing from another.
7. Self regulation is always corrupt and unfair.
8. The government is somehow an outside entity not tied into or part of the problem and equation.
It seems that so many people have no concept of how wealth is generated. Let's give a little example that is so 'econ 101' they shouldn't have trouble getting it.
Joe is an engineer. He sees a problem with life and decides to invent something to fix it. Joe works at the problem for a while, and finally realizes a nifty solution to the problem and wishes to build a prototype. Ignoring the process to get funding to go to production, Joe builds his solution and starts to sell it for 10 dollars each. The product actually costs Joe only 2 dollars each, but he now has a few employees to pay and his creditors expect to get their money back plus interest so his real cost is 5 dollars each. So Joe makes a tidy profit and becomes successful. He is earning 5 dollars per unit sold above his costs. Should he be forced to give that money back? No. The consumer thought the product was a fair price to fix their problem. The employees thought it was a fair wage to be paid them. The creditors thought it was a fair interest rate to be reimbursed. So Joe gets to keep his modest profit from modest sales.
Now, let's suppose Joe's product goes Crazy Popular! Say Oprah advertised it with Billy Mays and Ron Popiel and Joe gets orders for 10,000% more than normal! He can't keep up, and so he starts taking money he's been earning, reinvesting into his own company and expanding! It's not fast enough, and he needs to grow more, faster, so he takes out loans AND to help slow down demand and deal with the growing cost of business (which has jumped from 5 to 8 dollars per unit) he raises the price to 20 dollars a unit, profiting him 12 dollars each. This does little to slow demand, and even with rapid expansion he's still not able to keep up, so the price goes up to 30 a unit profiting the company 18. Most of the money at this time goes right back into the business to solidify growth, but throughout all of this, Joe keeps earning his personal 5 dollars a unit while the remaining 13 went to expansion. Now, millions of units later, those 5 bucks a unit profit that he kept personally, has amassed a vast fortune for him.
Now a strange thing happens. The business no longer needs to expand. The expenses have stabilized and there is no further need to grow bigger so fast. The cost of business drops back from 12 dollars a unit to 9. Plus the expansion which was needed is now building up, unused. What is to be done with that capital? Technically it's all Joe's, because he owns the company and it's just sitting in expansion funds doing nothing. It's time to reorganize the money.
Joe has many options and all of them, since it is HIS profit, earned fairly from the public. His workers were fairly paid and the creditors got their money back fairly too. So, Joe, deciding that he doesn't need the whole extra 13 bucks per unit decides to share it with other as well. He ups HIS profit per unit to 10. (30 bucks is a fair price to the public because the value the product gives) He then gives 5 more dollars per unit to the workers in his corporation, 2 dollars he chooses to give to charities, and 1 dollar he gives back to the public in lower prices.
Is this fair? Joe is a wealthy man, he has manyy well paid employees, he donates to charities he supports and he's even cuts the price a little to the consumer who already thinks it is a fair value to them.
This is how MOST businesses and self made rich (which is most of them) become so.
Hmmmm, highlighted in bold is where the questions do lay in these senario's. Did Joe do what was right in these areas of bolded text? This is what people are having huge problems with these days, because the reality isn't panning out as you have described it for the many, and this (((Joe))) along with his buddies, have become marked men because of, but of course no matter what the facts are, the senario in it's entirety and final conclusion of as was written above by you, will stand no matter what, and this even if the senario was found to be different and more hostile to the workers in the deal than what was shown in the senario above, yet it will still stand no matter what by apologist for crooked corporations or crooked companies that lie cheat and steal within the senario as would be then re-written above in contrast to. People understand what you have written here, but what they are trying to get a handle on, is when this senario or hypothetical goes wrong in the numbers being shown or handled.
If it went just as you described, then their would be no discussion or any problem at all, but the reason these discussions exist at all, is because the senario has been tainted by corruption and greed, and the people know it, experience it, and do see it first hand in the nation now.