Bernie, the "No Jobs" President

[Starlight]

Yes, insofar as it is observable.

?!?!
So the ability of people to go out and buy a share portfolio that reliably pays 5% or so, is just imaginary? Those companies aren't really making an observable profit?

[jordanriver]

I am sure you, as the janitor think it would be great to make the same as the Plant Manager, but do you really think mopping floors is worth the same as managing an entire plant to make sure everything is working smoothly so that the factory can make enough money to pay everyone, including you? Why would the plant manager even work so hard if he can get the same pay as his secretary does for answering phones and typing letters? Managing a plant is a lot of stress and responsibility. Everyone depends on you.

janitors do not have a part.

Every factory with attached office I know of, except the very small machine shops, contract a cleaning company.
The janitors do not work for the factories, they work for the cleaning company.
We're vendors, like the coco cola and pepsi machine guys and the guy who refills the potato chip/candy bar machines.


Its always up to new owners whether or not to keep the same cleaning company.

as far as managers go, from the articles I've read, it appears when the workers take over , the process is democratic, instead of one owner , or a small group of persons, the board of directors, who decide whether a town lives or dies.

[Joel]

?!?!
So the ability of people to go out and buy a share portfolio that reliably pays 5% or so, is just imaginary? Those companies aren't really making an observable profit?

I don't think it is very easy to pick a portfolio of stocks that reliably pays 5% or so. But I think you are missing the point of what is meant when economists say that profits tend toward zero. They are referring to any particular opportunity for profit. For example, the first person to discover a new production technique initially receives a profit, but as that technique gets adopted by the competitors, the profit from that particular new technique tends toward zero. Or the person who first discovers a non-optimal use of resources, say discovering that hammers are being under/over-produced, can initially gain a profit by correcting that non-optimality. But the very act of capturing that profit adjusts the situation and eliminates that particular opportunity for (further) profit.

If change and uncertainty ceased in this world, then it would all tend toward zero, after which there would never be any economic profits again. But in the real world--of constant change, innovation, and uncertainty--there constantly arise, and are discovered, new and different opportunities for profit. Thus there continue to be profits to be made. But I was responding to jordanriver in the context of a particular invention, that the profit from that particular invention tends toward zero. There does not remain a permanent profit of that invention, benefiting (only) the owner. (Unless, perhaps, the government gives the owner a monopoly on the invention, but then we are no longer talking about a free market.)

(We also need to not confuse various other things with profit. Like growth, which is savings, not profit. Or the marginal revenue due to an owner working in their own company, which is not included in what economists mean by profit. Time discount and inflation can also mistakenly show up as profit.)

[jordanriver]

I don't think it is very easy to pick a portfolio of stocks that reliably pays 5% or so. But I think you are missing the point of what is meant when economists say that profits tend toward zero. They are referring to any particular opportunity for profit. For example, the first person to discover a new production technique initially receives a profit, but as that technique gets adopted by the competitors, the profit from that particular new technique tends toward zero. Or the person who first discovers a non-optimal use of resources, say discovering that hammers are being under/over-produced, can initially gain a profit by correcting that non-optimality. But the very act of capturing that profit adjusts the situation and eliminates that particular opportunity for (further) profit.

If change and uncertainty ceased in this world, then it would all tend toward zero, after which there would never be any economic profits again. But in the real world--of constant change, innovation, and uncertainty--there constantly arise, and are discovered, new and different opportunities for profit. Thus there continue to be profits to be made. But I was responding to jordanriver in the context of a particular invention, that the profit from that particular invention tends toward zero. There does not remain a permanent profit of that invention, benefiting (only) the owner. (Unless, perhaps, the government gives the owner a monopoly on the invention, but then we are no longer talking about a free market.)
.)

how long does it take before all the competitors in the field are narrowed down to a few winners.

What happens to the losers.

[jordanriver]

yours is the side that suggests everybody is equal.

Equal opportunity does not guarantee equal results.

what equal opportunity?
Do you believe these beautiful human beings need to simply better themselves if they want an equal slice of the pie , maybe study and become IT Techs or something, since everybody has an equal opportunity? perhaps loan officer?, engineer?

[Cow Poke]

What happens to the losers.

They change their name to jordanriver and post about collectivism on Tweb.

[Littlejoe]

To Littlejoe:

Well, to quote someone else here on TWeb, "So it's all about ME?"

Yesh!

[Cow Poke]

Well, to quote someone else here on TWeb, "So it's all about ME?"

This is about me, isn't it?

[Cow Poke]

But I don't know what the income distribution is in factories with salespeople.

Sales is a unique animal. The reason one is "in sales" is because he can directly and powerfully impact his own income. Often, sales doesn't have a "floor" - and usually, sales doesn't have a "ceiling".

The salesman can work as hard as he wants and make as much money as he wants. I did business consulting, as well as IT infrastructure, and I would occasionally get a complaint from a business owner that the salesman was "making too much money". One woman business owner complained, "my lead sales person makes more money than ME!" I said, "that's a GOOD thing!"

When she hired him, there was an agreed upon % he would make, and the fact that he FAR exceeded her expectations on sales means he made a really huge salary. But, in the process, her company grew, and everybody benefited.

If you take away that salary incentive, sales decrease, and the entire company suffers - and maybe even goes out of business.

That's what jordanrivereconomics is all about - having the opposite outcome of what is intended.

[Sparko]

janitors do not have a part.

Every factory with attached office I know of, except the very small machine shops, contract a cleaning company.
The janitors do not work for the factories, they work for the cleaning company.
We're vendors, like the coco cola and pepsi machine guys and the guy who refills the potato chip/candy bar machines.


Its always up to new owners whether or not to keep the same cleaning company.

as far as managers go, from the articles I've read, it appears when the workers take over , the process is democratic, instead of one owner , or a small group of persons, the board of directors, who decide whether a town lives or dies.

And the new managers make more than the floor workers, and nothing changes. And new workers have to get vested in the ownership after jumping through hoops, like working for 5 years before they get profit sharing. All basically the same as when the company was owned by others.

[jordanriver]

And the new managers make more than the floor workers, and nothing changes. And new workers have to get vested in the ownership after jumping through hoops, like working for 5 years before they get profit sharing. All basically the same as when the company was owned by others.

except for the fact, that in cases like these, the factory is still operating instead of padlocked and relocated to Mexico or China etc

[jordanriver]

Sales is a unique animal. The reason one is "in sales" is because he can directly and powerfully impact his own income. Often, sales doesn't have a "floor" - and usually, sales doesn't have a "ceiling".

The salesman can work as hard as he wants and make as much money as he wants. I did business consulting, as well as IT infrastructure, and I would occasionally get a complaint from a business owner that the salesman was "making too much money". One woman business owner complained, "my lead sales person makes more money than ME!" I said, "that's a GOOD thing!"

When she hired him, there was an agreed upon % he would make, and the fact that he FAR exceeded her expectations on sales means he made a really huge salary. But, in the process, her company grew, and everybody benefited.

If you take away that salary incentive, sales decrease, and the entire company suffers - and maybe even goes out of business.

That's what jordanrivereconomics is all about - having the opposite outcome of what is intended.

I'm not sure how the new worker coops that are successful handle that part,

Or the more than 300 so-called "recovered factories" operating in Argentina

Source: New hope for Argentina in the recovered factory movement

The former salesman is there by the popular vote of his fellow workers. source

© Copyright Original Source

[Joel]

how long does it take before all the competitors in the field are narrowed down to a few winners.

History has shown that freer markets lead to growing competition. Sustained concentration of firms requires government regulation.


I'm still interested in you telling me more about how your worker-owned firms work.

[jordanriver]

History has shown that freer markets lead to growing competition. Sustained concentration of firms requires government regulation.


I'm still interested in you telling me more about how your worker-owned firms work.

they're not mine. I just pointed out they exist. The ones in Argentina appear to be democratic, with the workers being the ones doing the voting.'

Do you notice the citation in post 72

[Sparko]

except for the fact, that in cases like these, the factory is still operating instead of padlocked and relocated to Mexico or China etc

doubtful. If they can't sell their goods at a profit, then they will close just like any other factory.