Minimum Wages vs Minimum Employees

Reply to: On Raising the Minimum Wage

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If it would be beneficial to increase the minimum wage… then why not also decrease the price of movie tickets, popcorn and sodas? 

If it would be beneficial to increase the minimum wage… then why not also force employers to hire more workers? 

If preventing the exportation of jobs is beneficial… then why not also prevent the exportation of food? 

If preventing the exportation of jobs is beneficial… then why not also prevent the importation of workers? 

If preventing the importation of workers is beneficial… then why not also prevent people from having more than one child? 

If preventing the importation of workers is beneficial… then why not also export the least productive American workers? 

If preventing workers from accepting less than minimum wage is beneficial… then why not also prevent workers from giving their labor away for free? Isn’t “free” less than the minimum wage? Right now we’re giving our labor to Medium for $0.00 dollars an hour. Why not force Medium to pay Americans the minimum wage for their labor? 

See also… Workers: Beggars or Choosers

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Anybody watched Madam Secretary on Netflix?  In the episode "Whisper Of The Ax"... Stevie, the 20 year old daughter of the Secretary of State, decides that she'd like to volunteer full time for a good cause... microloans.  The program is desperately understaffed and the only paid employee, Arthur, is very happy to have Stevie help out.  At the end of her first day volunteering, Stevie and Arthur exchange some information...

Arthur: You're still here.

Stevie: Yes.  Why wouldn't I be? 

Arthur: Oh, my God! You think this is a paid internship.

Stevie: No, I don't.

Arthur: Because it so isn't.

Stevie: Yeah, I figured 

Arthur: Okay, good.  On the upside, that means your mother's budget cuts won't affect the position.

Stevie: You know who my mother is? 

Arthur: I do.  And I don't care.  Unlike literally everybody else I've hired, you want to be here.  That works in your favor.

Stevie: Great.

Arthur: Here's some paperwork you'll need to take to your school's career services office.

Stevie: Oh, um, I'm actually not in school, so 

Arthur: Oh, the, uh, internship's only available for college credit.

Stevie: Like you said.  I'm really happy to be here.  I mean, I really like feeling useful 

Arthur: No, we have to do it in conjunction with a university course.  Otherwise asking people to work for no compensation is what the government likes to call slavery.

Stevie: Well can I, can I sign a waiver or something? 

Arthur: No, it's nonnegotiable.  It's part of the program's charter.  I'm sorry.

Benefit is in the eye of the beholder.  If it wasn't, then there wouldn't be any problem with the government determining whether personal relationships are adequately beneficial.  

Payment Costs

Reply to: Hey there!

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Glad you appreciated the info!

Regarding volunteers… aren’t we volunteers? Here we are on Medium pouring our time, effort, energy, experiences, uniqueness, information, sweat, tears, blood, bones and brains into our stories! Well… more or less… heh. And nobody pays us for our significant sacrifices! Sheesh!

Maybe our sacrifices are worthless? Or maybe it’s the free-rider problem? Or maybe it’s the compensation barrier problem?

Here’s your story that I recommended…. Money Is A Broken System Of Value. Clearly I liked it… hence the recommendation. And recommendations are certainly useful! It’s nice to know whether people like a story. But the problem with votes/likes/recommendations is that they don’t communicate how much somebody likes something.

Does it matter how much your sacrifice is worth to other people? For sure!

Let’s say that your story was worth 10 cents to me. Is it possible for me to send you 10 cents? Of course! If paypal doesn’t allow payments as small as 10 cents then I could snail mail you a letter with 10 cents in it. The problem is that the postage would cost a lot more than 10 cents. Not to mention the time and effort involved in getting your address, finding a letter and writing your address on it, finding a dime and putting it into the envelope, sealing it and risk getting a paper cut on my tongue, looking up the correct postage, finding stamps and sticking them on the letter and putting it in my mail box.

The harder it is to give you 10 cents… the less likely it is that I will do so. This is the compensation barrier problem. Actually I just made that term up. Maybe barrier to payment would be a better term? Barriers to entry is a real term… but for a different, albeit equally important, concept. Perhaps the closest correct term would be transaction costs.  However… that entry doesn’t mention anything about the difficulties associated with making a payment (unless I missed it). So maybe “payment costs” would be a better term?

Right now the payment costs on Medium are too high. One way to reduce the payment costs would be to give us all digital wallets. I could use paypal to put $10 dollars into my Medium wallet. Then I could click the dime button that was next to the recommend button on your story. Voila! With one click 10 cents would be transferred from my wallet to your wallet! It would be sooooooo stupid easy and quick to give you 10 cents! You could either spend that 10 cents on other stories or you could save up your money and have Medium paypal it to you.

Here’s another way of looking at it…

Recommend button (free)
Really recommend button (1 cent)
Really really really really really recommend button (5 cents)
Really really really really really really really really really really recommend button (10 cents)

You get the idea. Rather than having a recommend button with 25 “reallys” in front of it… it makes more sense simply to have a 25 cent button.

With the current system… we can sort stories by popularity (number of recommendations received). But if Medium did a better job of facilitating compensation/communication… then we would be able to sort stories by value (amount of money received). I’m pretty sure that most people would prefer to sort stories by value rather than by popularity!

If valuating stories was as easy as recommending them, then Medium would have a lot less volunteers and a lot more paid writers. It stands to reason though that few, if any, of the compensated writers would be able to quit their day jobs. But… it might encourage them to quit their less profitable pastimes. The more lucrative it is to write stories… the less lucrative it becomes to play video games or watch TV or have sex.

So by giving you 10 cents for your story… I’d essentially be trying to motivate/incentivize/bribe/encourage/inspire you to continue doing something that benefits me… instead of doing something that doesn’t benefit me.

In economic terms… giving you 10 cents for your story marginally increases the opportunity cost of you doing something other than writing stories.

With this in mind… if I truly value your story at 75 cents…. but, because of the free-rider problem, I only give you 5 cents… then I’m inadequately incentivizing you to do something that I benefit from. On the other hand… 5 cents is certainly better than 0 cents!

Let’s say that only members of Medium could read stories and it cost $5,000 a year to be a member. Members would be completely free to choose which stories they spent their $5,000 dollars on. Would this eliminate the free-rider problem? Yup. But would it result in the maximum payment for stories? It seems… doubtful. Having to pay $5,000 dollars to become a member of Medium would create a pretty high barrier to entry.

x = a lot of people paying a little
y = a little people paying a lot

Eh? Midgets would have to pay the most?

x = a lot of people paying a lit
y = a lit of people paying a lot

Maybe it would be nice if “a lit” was the opposite of “a lot”? Or something like…

x = a large amount of people paying a small amount
y = a small amount of people paying a large amount

That works… but it requires too many letters! Or…

x = more people paying less
y = less people paying more

I suppose that’s the best way?

Anyways…

It’s entirely possible that x > y.

By minimizing payment costs… Medium would become a market. Or, it would become a better market. Who doesn’t want to participate in a better market? But it’s not like the model would be impossible to copy. So competitors would quickly emerge. And we’d see a continuum of membership fees. All else being equal… whichever website/market has the highest paid writers would have discovered the optimal membership fee.

Minimizing payment costs helps to clarify demand. Clarifying demand increases benefit. The optimal membership fee will be the fee that provides the most demand clarity… which will maximize benefit.

You know what India has? A lot of nice orchids. You know what I like? Pictures of nice orchids growing on trees. That link takes you to my favorite photos on flickr. I’ve favorited 100s and 100s of photos of orchids growing on trees. When I search my favorites for “India” there are only 47 results! That’s way too few results! There should be a lot more results!

Here’s one photo that I particularly like… Foxtail Orchid. It’s a nice photo of a really nice orchid. Here’s a photo that I might like even more… Acampe praemorsa. Even though the orchid isn’t even blooming… the photo really shows how dry the habitat is. Which is right up my alley! I live in very dry Southern California… so I’m especially interested in drought tolerant epiphytic orchids.

Dinesh Valke took the photo of the epiphytic orchid in a dry habitat… and I’m the only one who fav’d it.

So there Valke is in India. And there you are as well. He took a photo that I like and you wrote a story that I like. Both of you voluntarily did something that I benefit from. And in neither case did I accurately communicate the amount of benefit that I derived from your respective actions. And in neither case is it entirely my fault. This is because neither Flickr nor Medium have grasped the value of minimizing payment costs. In other words… neither website understands the value of clarifying demand.

My point is… yes, I’m sure that that the government in India is a problem. But it’s only a problem because people don’t understand the value of clarifying demand. And changing the government is probably the hardest thing that you could possibly do to help people understand the value of clarifying demand. It would be a lot easier to change Medium or Flickr. And, honestly, this really isn’t the first time that I’ve told Medium that it should minimize payment costs by facilitating micropayments! So if changing Medium is an epic mission… then trying to change the government would be a monumentally epic mission.

It’s probably a lot easier to grab a couple of your best programming friends and create a website that minimizes payment costs. Your website would help people understand the value of clarifying demand and our respective governments would quickly change accordingly.

Am I stereotyping you Indians by assuming that you have at least a few friends that can program? Heh.

I actually modified some code to create a forum that facilitates micropayments. This blog entry… RudeBagel… has some links to some of the code that I modified. Let me just say that I’ve spent infinitely more time studying economics than I’ve spent studying programming!! The code works… as long as there aren’t any 12 year old hacker kids around!

The website is online… but every page should, in theory, redirect to the login page and I’ve disabled the registration. I’m trying to make some modifications and am looking for any excuse to procrastinate.

You and your programming buddies are welcome to build on the micropayments forum idea or create some other type of website that minimizes payment costs. In any case, should you get stupid rich from doing so, then I’ll be sure to sue you for a huge chunk of the money! Because I’m American! And we Americans love suing people. :D

Actually… the general trend is in the direction of clarifying demand. Take Patreon for example. However, Patreon was created with the intention of helping creators get paid. It wasn’t created with the intention of clarifying demand. This is a subtle but important distinction. If the founders of Patreon had actually understood the value of clarifying demand… then they would have set it up so that sponsors would be free to pay what they wanted for specific creations.

Dinesh Valke has 275 pages of photos on flickr. Do I value all his photos equally? Noooooo.

Here’s my valuation ranking of his photos…

1. Epiphytic orchids growing in dry habitats
2. Epiphytic orchids
3. Epiphytes
4. Plants
5. Animals
6. Other

I don’t want to encourage Valke to take more photos in general… I want to encourage him to take more photos of epiphytic orchids growing in dry habitats. I want to encourage him to do something that creates more, rather than less, value for me.

Clarifying demand is all about increasing the accuracy of communication… which is what increases benefit.

Basically, we want treasure maps to be more, rather than less, accurate.

Let’s say that Flickr minimizes payment costs and Bob, an American, is about to spend a few months backpacking around India. Before he take his trip… he searches Flickr for “India” and sorts the photos by value. What types of photos are the most valuable? Which subjects are in the greatest demand? Perhaps after scrolling down a bit Bob will see that I’ve allocated $100 dollars (hah… I wish!) to Valke’s photo of the epiphytic orchid in the dry habitat.

Medium, like Flickr, also clarifies demand so Bob decides to search Medium for “India” as well. What stories are the most valuable? Which stories are in the greatest demand? Bob also conducts the same search on Youtube… which also clarifies demand.

Bob ends up with a fairly accurate treasure map. With some luck and skill he can cover the cost of his trip. Of course, a billion people in India will have access to the same exact treasure map! So Bob will have some pretty stiff competition when it comes to supplying the demands of consumers. Which is really wonderful for consumers.

Anyways, I’ve rambled enough! If not, then here are some more ideas on the same topic… Creating The Most Efficient Demand Net.

Minimum Wage Vicious Cycle

The Nobel Prize liberal economist Paul Krugman recently argued that we need more government because people tend to make poor education/career decisions.  Shortly after reading Krugman's case for bigger government, I read an article in the LA Times about how some people in the Philippines were lured to America with the false promise of high wages.

Somewhat inspired by this very popular blog entry... A Week of Shorter Rod Drehers... I patched together some relevant snippets from Paul Krugman...

Krugman: The world economy is a system -- a complex web of feedback relationships -- not a simple chain of one-way effects
Krugman: Wages, prices, trade, and investment flows are outcomes, not givens
Krugman: Wages are a market price--determined by supply and demand
Krugman: Money still talks — indeed, thanks in part to the Roberts court, it talks louder than ever
Krugman: Raise minimum wages by a substantial amount
Krugman: The price of labor--unlike that of gasoline, or Manhattan apartments--can be set based on considerations of justice, not supply and demand, without unpleasant side effects
Krugman: Your decision to stay in school or go out and work will shape your lifetime career
Krugman: Now, the fact is that people make decisions like these badly
Krugman: Bad choices in education are the norm where choice is free
Krugman: He and his unwary readers imagine that his conclusions simply emerge from the facts, unaware that they are driven by implicit assumptions that could not survive the light of day

If you'd like the context, just click the links.  As you can see... Krugman used to be an opponent of minimum wages... but now he's a proponent.

From my perspective, a minimum wage is a problem because it doesn't accurately communicate the demand for unskilled labor in any given area.  This increases the chances that people will make really bad career/education decisions.  Here's how I've illustrated this...

And here's another attempt...

My drawing skills aren't that great... but hopefully you should get the idea that, in this drawing, the US has more than enough people pushing brooms (unskilled labor).  In economics... "more than enough" means that there's a surplus.  Usually when there's a surplus of something the price will accurately communicate this information to the entire world.  A low price says "hey, we have more than enough!".  This important information helps people make informed decisions.  When this important information changes, people's decisions will change accordingly.  So in order for the US to have ended up with such a massive surplus of unskilled labor... something must have gone wrong with the price system.  And that something is the minimum wage.  A minimum wage says, "hey, we don't have enough unskilled labor!".

A minimum wage creates a vicious cycle.  When wages falsely signal that the US has a shortage of unskilled labor... this increases the chances that people will make big mistakes.  Students are more likely to make the big mistake of dropping out of school and unskilled immigrants are more likely to make the big mistake of risking their lives to move here.  The logical consequence of so many people making big mistakes is an increase in poverty... which is then used to justify an increase in the minimum wage.

So what would happen if we eliminated minimum wages?  I'm guessing that wages for unskilled labor will decrease.  And I'm sure that proponents of a minimum wage would guess the same thing.  Right?  Because if we eliminated the minimum wage... and wages didn't decrease... then there wouldn't be a need for a minimum wage.

If proponents of a minimum wage want to guess that eliminating the minimum wage would result in a huge decrease in wages... then, assuming that they are correct, this huge decrease would reveal that there is indeed a huge surplus of unskilled labor in the US.  This would conclusively confirm the problem with lying to people about the demand for unskilled labor (aka "a minimum wage").

Would chaos ensue if we learned that there actually was a huge surplus of unskilled labor in the US?   Well... no.  Take China for example.  They used to have a huge surplus of cheap labor... but now they don't...

Costs are soaring, starting in the coastal provinces where factories have historically clustered (see map). Increases in land prices, environmental and safety regulations and taxes all play a part. The biggest factor, though, is labour. - The Economist, The end of cheap China

Wages in China really didn't skyrocket because of a minimum wage... they skyrocketed because of the massive demand for cheap labor...

While corporations may look elsewhere for still cheaper labor, there are no more Chinas out there.  Other countries that establish themselves as low-wage havens will soon be overwhelmed by the inflow of capital from the United States, Europe, Japan, and now China. They cannot possibly have the same dampening effect on wages in the United States over the next three decades as did China and other developing countries in the last three decades.  - Dean Baker, Living in the Short-Run: Comment on Capital in the 21st Century

In case you didn't actually dig through all those Krugman articles that I shared earlier, I'll point out that he vociferously argued against the idea that the massive increase in the global supply of cheap labor had anything to do with wages stagnating in the US.  Eventually he acknowledged that perhaps there were some issues with his "implicit assumptions".

Let's review!  Here are two possibilities of eliminating the minimum wage here in the US...

1. Wages don't plummet.  Then there's really no point in having a minimum wage.
2. Wages do plummet.  Then the US "will soon be overwhelmed by the inflow of capital from the United States, Europe, Japan, and now China".

We really don't help anybody by giving people bad directions.  If you truly want to help poor people... then start a business.  Give poor people a better option (builderism).  Especially if you have a strong theory that some existing business is making a stupid mistake.  Put your strong theory to the test by starting a business that doesn't make the same stupid mistake.  Maybe you want to argue that starting a business is too difficult?  Well there you go.  You've successfully identified a huge problem.  It's a huge problem when it's too difficult to give poor people better options.  Please figure out how to make it easier for somebody as intelligent as yourself to start a business.  And if you can't figure it out... then please have some respect for anybody who does manage to successfully start and run a business that employs/serves any amount of people.

Builderism

Anybody else starting 2015 with a cold?  Sore throat, runny nose, achiness...it's really not the best way to start a new year.  So far no good.  I'm not superstitious, much, but I do feel some need to offset this lousiness with lots of awesomeness.  So I'm going to post this entry today even though it could probably do with a few more days/years of refining.  To help hedge my bets, at the end I'll share my recipe for the very best breakfast to make when you're sick.

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Who really helps the poor?  Does Cutlass?

Context: Welfare Theorem vs Progress Theorem

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A huge part of the problem here is that you think that elections (cheap talk surveys) accurately reflect the demand for public goods...

No, I don't. Because elections can't segment out that level of discrimination. But they can and do aggregate it, to a point. And within a useful margin for discussion. So while it is an imperfect measure of preference, and while it is an aggregated measure, rather than an individual measure, it still is a measure of revealed preferences.

And that revealed preference is for not helping the poor. Not beyond a minimum point, anyways.

Taxpayers, at least initially, would be paying the same taxes. They would be able to choose where their taxes go...and congress would still be in charge of determining the tax rate. So the amount of money that congress itself receives will reflect how satisfied taxpayers are with the tax rate. If the tax rate is too high...or too low...then congress will lose money. And whether the tax rate is too high...or too low...depends on how much value the public sector is creating relative to the private sector. To learn more...pragma-socialism.

Now you are opening yourself to 2 economic fallacies: Free rider problems and public goods problems. People will express false preference in order to save themselves a buck, and free ride on the generosity of others. And that causes a public goods problem, in that underinvestment in public goods is the normal course of individual preferences.

Education doesn't benefit the poor?

Giving endowments to major universities doesn't feed or house the poor.

The Koch brothers employ far more people than I do...so I'm certainly in no position to judge their concern for other people's welfare.

Employing people has nothing to do with providing aid the poor. The Koch brothers, on the other hand, spend vast fortunes to try to convince people of their point of view, and that point of view is that government should take from the poor and give to the Koch brothers.

So, in effect, you started this discussion with the brief of making things better for the poor through a different means of government. But then since then you've been defending making the poor much worse off by empowering those who want to harm them, and disenfranchising those who wish to help them.

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If somebody was a connoisseur of contradictory arguments then they might really appreciate this guy's argument.  Let me try and break it down...

1. Voting adequately reveals people's preferences
2. People don't really want to help the poor
3. People lie in order to save a buck
4. Pragmatarianism would...
A. disenfranchise those who want to help the poor
B. empower those who want to hurt the poor

#3 negates #1 and #2 negates #4A.  Except, if #1 isn't true, as this paper suggests, then perhaps neither is #2.  If people really do want to help the poor, then would pragmatarianism prevent them from doing so?

A Global Free-trade Agreement for Public Goods

People sometimes ask me how, in a tax choice system, we'd determine which organizations would qualify to receive tax payments.  My usual quick response is that, very generally speaking, voters would decide what's on the "menu" and taxpayers would order the "dishes" that most closely match their preferences.

An idea that was interesting enough to blog about just crossed my mind as I was browsing Inge Kaul's book...Providing Global Public Goods.  Now, I'm not saying it's a good idea...or a bad idea...and I'm not quite sure if I'd support it...but it's definitely thought provoking enough for me to throw out there.    

Continuing with the restaurant analogy...rather than limiting taxpayers to only dining at their own country's restaurant...why not allow them to dine at any country's restaurant?  Taxpayers would have to eat (pay their taxes) but they would be able to select the dishes from any country's menu.

Let's take Sarah for example.  She's a young American taxpayer whose number one priority is the environment.  At anytime throughout the year she could make a tax payment directly to the Brazilian equivalent of the EPA.  Sarah would receive a receipt...which, along with all her other receipts, she would submit to the IRS by April 15.

Markets allow resources to flow where they create the most value.  A tax choice system would create a market in our public sector...but the flow would generally be restricted to within our country.  Completely removing that restriction would allow for the global free-trade of public goods.  In theory this would create far more value.

Can you predict which country would receive the greatest inflow of public funding?  What impact would it have on the Israeli-Palestine conflict?

Clearly this public goods free-trade agreement would facilitate global convergence.  But how much would it help developing countries catch up with the rest of the world?  Well...that would depend on the rate of outflow.  As I argued in my response to John Holbo's critique of libertarianism...we can gain far more from global innovation than the world can gain from American innovation.  The more we help developing countries catch up...the more we'll benefit from their innovation contributions.

Speaking of my favorite Crooked Timber Liberal...I'll conclude this brainstorm with this comment that I posted on John Holbo's blog entry on selling votes (the discussion on my blog)...

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Peter T…oh man…never thought of that! It’s an extremely fascinating point though.

Let’s say Brazil was going to vote on whether it should develop or conserve the Amazon rain forest. Given that I’m not a citizen of Brazil I wouldn’t be able to directly vote on the proposal…but nothing would stop me from sending money to any Brazilian who was on my side of the issue. So I’d send $100 to a Brazilian conservation organization that would be responsible for buying votes for the pro-conservation side.

Everybody in the world would benefit from saving the rain forest…so how much money would everybody in the world send to the conservation organization? Then we can imagine all that money being exchanged for votes…in essence all that money would be transferred to Brazilian citizens that were willing to sell their votes in favor of conservation.

That’s some really heavy stuff. People in country A wouldn't send money to country B unless they cared about the outcome of elections in Country B. Imagine there was an Islamic fundamentalist party running against a pro-Western party in some Middle Eastern country…how much money would the world send to the organization responsible for purchasing votes for the pro-Western party? Then we can imagine all that money being transferred to people willing to sell their votes to the organization responsible for buying votes for the pro-Western party.

The Government Grows at the Expense of the Middle Class

In this thread on socialism/capitalism a socialist shared this chart which basically argues that declining union membership is responsible for the shrinking middle class income (source: ThinkProgress.org)...

In response I created this chart which basically argues that the growing government is responsible for the shrinking middle class income...

As government expenditures as a percentage of GDP (Gross Domestic Product) increases....the middle class share of national income decreases (data source: http://www.usgovernmentspending.com/).  Let's put things in context.

In the 50s and 60s...unions were at the height of their power.  They strong-armed manufacturers into paying wages that were so high that it became economically feasible for manufacturers to move their factories to the other side of the world.  In doing so they gave people in South Korea, Hong Kong, Taiwan and Singapore a new option.  Was it a "good" option?  Given that so many people chose this new option...it's self-evident that it was the "best" of their available options (see my post on Subsistence Agriculture vs Sweatshops).  Factory owners taught their employees new skills and eventually some of their employees took their new skills and opened up their own factories.  This increased the demand for labor...and because the supply of labor was constant...wages began to increase.  As a result...in the early 80s...many manufacturers moved their factories over to China.  Before the 80s they were not able to do so because Mao Zedong had closed China off to foreign investment.  This changed in 1978 when Deng Xiaoping came to power.  He created Special Economic Zones where foreign manufacturers were allowed to open factories.  Eventually these zones expanded and as a direct result millions and millions of Chinese people were lifted out of poverty.

The question is...where's the race to the bottom that so many socialists had been decrying?  It's clearly and indisputably a race to the top...

Rising wages in emerging markets and higher shipping costs are also closing the cost gap between developing markets and the United States. - Scott Malone and Ernest Scheyder, Outsourcing Losing Its Allure As China Costs Soar

That's the global pattern.  It's abundantly clear that unions got the ball rolling.  If it hadn't been for their rent-seeking behavior...it wouldn't have been economically feasible for manufacturers to move their factories to the other side of the world.  Therefore, unions were unintentionally responsible for lifting more than half the world out of poverty.  Of course...they hurt the American middle class in the process.

But have you ever asked yourselves sufficiently how much the erection of every ideal on earth has cost? How much reality has had to be misunderstood and slandered, how many lies have had to be sanctified, how many consciences disturbed, how much "God" sacrificed every time? If a temple is to be erected a temple must be destroyed: that is the law - let anyone who can show me a case in which it is not fulfilled! - Nietzsche

Here we are at a cross-roads situation.  What temple do we want to erect now?  Do we want to continue building government temples on the backs of the middle class like Pharaohs of old built pyramids on the backs of slaves?  Who did the pyramids benefit?  Who does our government benefit?  What temples would  Egyptian slaves have built for themselves if they had had the freedom to do so?  The disparity between the temples that we are forced to build and the temples that we would choose to build is where we need to focus our attention.  Right now there's a disparity between the government temple currently being built by 538 congresspeople and the government temple that taxpayers would build if they had the freedom to choose which government organizations they gave their taxes to.

If the temple being built by congress is truly better than the temple that taxpayers would build...then why would we want to increase the middle class share of income?  The government is clearly better at spending their money than they are.  However...if somebody is going to argue that we're better off by increasing the middle class share of income...then the argument is that we're better off by giving the middle class more money to spend.  But why would this be true in the private sector but not in the public sector?

If the middle class is going to sacrifice its income for the government...then let the middle class choose what the government does that's worth its income.  If the lower and middle classes want the upper class to sacrifice its income for the government...then let the upper class choose what the government does that's worth its income.  The only people who should be allowed to decide whether the government is worth the cost are the people who bear the cost.  The alternative is completely ignorant nonsense...aka representative economics.  How can somebody who doesn't bear the cost accurately determine whether a benefit is worth the cost?

If you don't bear the costs of fighting the war against poverty...then how can you know whether the benefits are worth the cost?  If you don't bear the costs of fighting the war against drugs...then how can you know whether the benefits are worth the cost?  If you don't bear the costs of fighting the war against terrorism...then how can you know whether the benefits are worth the cost?  If these things are worth the cost to you...then does that automatically mean that they are worth the cost to your neighbor?

Markets work because each and every consumer has the freedom to decide for themselves whether the cost of what they want is worth the benefit.  The outcome reflects our diverse perspectives, tastes, values, interests, preferences, concerns, hopes and dreams.  The government fails because there's just no way that 538 people can determine for millions and millions of taxpayers whether a government expenditure is truly worth the cost.  If we want government to succeed...if we want the benefits to be greater than the costs...then we simply need to give each and every taxpayer the freedom to choose which government organization they give their taxes to.

The temple that we must destroy is the idea that the human race benefits from representative economics.  If we agree with Thoreau that the "price of anything is the amount of life you exchange for it"...then representative economics is the idea that somebody knows better than you do what your life is worth.  Our lives are way too short for that crap.

It is through the gaze of my extinguished self that I realize the limitations that make scarcity necessary. Through this gaze into my own limitedness - a limit always established by the impending cessation of space and time for me - through this gift of death, I discover in nature the best way to be efficient. Thanks to death I must choose x rather than y. This has become a feature of 'nature' - a demystified 'nature' that bears no possibility of participation in the eternal. This is consistent with capitalism. - D. Stephen Long