Constitutional Amendments Say No

[peristaltor]

Some time ago, I asked the forum in the Friday Lulz tradition to imagine a world where money was excluded from the political arena. Few bit, most of those dismissed, probably for the same reason that people don't sit around dreaming of what the sky would look like green instead of blue.

Ah, it turns out (through NPR, of all places) that others

Comments

[montecristo]

Your complaint is a common one in economic circles. It is the product of folk economic thinking. I call it the "Capitalists Will Buy Up the World and Eject Us Into Space" fallacy. If your complaint had a basis then why haven't "greedy capitalists" bought up even a small state in the U.S., say Rhode Island, and made evil "superfortunes" through various forms of "market blackmail." The problem underlying this fallacy is the failure to realize that all trade involves an exchange of values. As trade occurs, the market changes and values are reaasessed. The reason that it would be impossible for "capitalists" to buy up all of the land is that they could not offer anything in exchange that all other present landowners would consider more valuable than all of the land they would hypothetically be trading away. Where would a capitalist aquire such wealth in the first place? What other planet could a hypothetical capitalist trade to the rest of humanity to acquire the entirety of this one? Consider this: one of the richest men on Earth, Bill Gates, essentially derrives his wealth from the sale of the operating system Microsoft Windows. From each copy of Windows that is sold, Gates himself receives but a tiny fraction of the money for which the copy of Windows is exchanged. When we walk into a store and buy a copy of Windows, it is on the presumption that we want and value that copy of Windows much more than we want the two hundred dollars we are prepared to spend to buy it. The two hundred dollars represents but a very small fraction of our income, let alone our net wealth. Basically, the buy-up-the-world fallacy involves mistaken cause and effect perception. We see the "capitalist" as "controlling the market" and the "consumer" at his mercy, when in actuality, it is the consumer who imputes value to the factors of production, in the first case, and in the second, everyone in the market plays multiple roles, both as capitalists themselves and consumers, as those who hire and as those who labor. It is not as simple as the fallacious scenario implies.