Mitt Romney's Re-Invention As Anti-Poverty Warrior

originally posted by: NavyDoc
No there isn't. It is not a zero sum game.

In a local economy it is a zero sum game. At any given moment there is a finite amount of money in the system, in order for one person to have more another person will have less. That's why wealth inequality is an issue and why we can't simply spend our way out of poverty. If it wasn't a zero sum game you could fix all issues by simply adding more money and instead of having rich and poor have rich and richer. It doesn't work that way though, when you add more money to a system, all other money devalues.

Even if you grant the point that working can create more money in the system through fractional reserve banking and the power of banks to simply add more, you devalue what everyone else has. Which goes back to the point... you're going to have rich and poor regardless. If one person works smarter or harder and ends up with more, that results in another person having less.

You still end up with one person in poverty.

a reply to: Aazadan

Selling shovels in a gold mining town. Miners go out and work hard and there are about 100 reasons why they cant get ahead without a big strike. Most of the really big money in mining towns was not made by the guys actually digging it up.

originally posted by: Logarock
a reply to: Aazadan

Selling shovels in a gold mining town. Miners go out and work hard and there are about 100 reasons why they cant get ahead without a big strike. Most of the really big money in mining towns was not made by the guys actually digging it up.

Thank you, this is a great example. During the gold rush people were literally pulling money out of the ground and water. Yet very few miners ever struck it rich. The reason is that inflation in their economy was quite high. With so much money floating around the businessmen that kept everyone supplied and the bankers that fronted the costs of the expenses were able to charge higher rates. In the mining towns despite the miners having literal tons of gold they were still largely poor. It's not that they weren't working or that they weren't performing labor that's in demand. It's that in economics not everyone can be rich. Most people by definition are going to be poor.

We had a situation in the gold rush where everyone had access to money, yet inflation simply ate away all of their gains. The same is true today, if everyone works hard and performs valuable labor that adds money to the system, all we do is inflate everyone to the poor house. That's why you can't eliminate poverty simply by creating prosperity.