If you choose to work in a field you could find yourself stuck when things turn bad. That is a risk. So what is killing the auto industry in this country? Bad managment for one. The companies are suffering due to their choices. Also, the workers are suffering due to that and their own choices. The auto workers unions have put them in a bad place.

Then there is foreign competition. Cheaper labor right? How can we differentiate from that? Companies could outsource production to forien locations to compete more. What about their workers here? Again, that was a risk, and a pretty sucky one. If the compnaies wanted to keep manufacturing in the U.S. and still pay their workers a premium they needed to differentiate themselves in design or marketing from the competitors who are using cheaper labor. They haven’t! That’s why they are failing.

One must always have an eye out on the market and choose a course that you think will work for you. It sucks to be an American auto worker now.

One of the large problems in this country is that we assume that the government is and should always going to be there to bail us out. That can’t work. Bailout is an attempt to avoid results from actions that were wrong. It is doomed to collapse. What we need to do is realearn self sufficiency and Benevolnce. Then, if things fail you can fall back on yur reserves and/or the goodwill of others around you.

More later.

What about automobile manufacturers? There’s no law saying I can’t compete.

I’m not saying anyone should be immune to risk. Risk exists. I’m saying it’s fair that people who take risks get compensated for that.

My point about having a job is that I don’t have to worry about salemanship. But I haven’t seen an answer to the question: how much of the total revenue is it fair for the salesman to get?

As for risks….So? Why should you be immune to risk? Life isn’t like that. No goverment/social system that tries to prevent risk will succeed. You can fall back on your own resources, or the good-will of friends and relatives. Honestly, what is without risk?

You have a good paying job? Was it an accident? Did you get it by doing and knowing nothing? Do you keep it by not doing anything? Of course not!

There are both barriers and costs to entry. The costs are less of a problem; the barriers are a big problem. I can’t start a cellphone company to compete with ATT. I can start a PC company to compete with Dell.

Other costs involved in starting a company are the risks. The example worker makes $50/chair. If the market changes, and people stop buying chairs (big asses need sofas), he might lose his job, but he still got $50/chair while he worked. If he worked for himself, he’d be stuck with a lot of chairs he paid for the materials for, and gets nothing for his recent work.

Then there’s the issue of sales. I’m a really good programmer, but I can’t sell. As a consultant, I could make several times as much money by working with a salesman who could persuade companies to hire me. So, what is his fair share of the joint income? (E.g. on my own, I get $200/hour for 10 hours/week. With him, I get $250/hour for 30 hours/week.) (Fortunately, I have a well-paying job, so I don’t have to worry about that issue.)

You are correct. It was, perhaps, an over simplification. So, now that we’ve clarified that, is there a contention here somewhere?

I expect the one typically heard would be, the worker isn’t paid eaqual to the value of what he produces. This is really a non-issue though. If he (and I use the term to mean she as well) feels he is being cheated of this value he can always go into business of himself.

Not to jump ahead, but…..the argument I hear against this is typically is that it’s not easy for a person to start their own business as there are costs of entry that will be beyond them. My answer to this is to point out that that is a hidden value you get of working for another.

Still, you can work for another and save money towards your busniess, or come up with and sell a plan to investors or a bank to raise the money to start out.

Consider my post #117.

Bawrence, it’s much simpler to understand in the case of one-at-a-time. Using lots of equipment and making a tiny portion of 50 chairs doesn’t change the principles.

I guess I’m confused.

Certainly the employer pays the employee, and lots of other expenses. The difference between what he pays out and what he takes in is the profit. If there was no profiit, why is he in business?

The employer pays someone $50 to build a chair from $50 worth of materials. He sells the chair for $150. You claim there’s a $50 profit.

I observe that he also paid a salesman $5 to do the selling, a bookkeeper $3 to handle the accounting, his bank $4 in interest on the money between the time he paid it and the time the buyer paid him, rent, lighting, payroll taxes on what he paid all the people mentioned, etc. etc.

His final profit might well have been negative. The value the employee added to the company by the work of building the chair certainly wasn’t $100 (less the $50 he was paid).

He also notes that he is not making a moral comment upon this.

I think he’s absolutely correct. Now, if you start to comment on this wondering what it’s moral implications are, that may be a different discussion entirely. As Steve has stated it, he is correct.