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by lumost
1815 days ago
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Something being free simply means the government paid for it on behalf of the worker. Direct resource allocation likewise just implies the government paid for it albeit without consideration for margin or potentially the ability of the resource allocator to remain solvent. Direct resource allocation implies that valuable resources were taken from one activity and allocated to another, the workers who produce the resource still get paid (hopefully!) and the equipment still undergoes wear and tear or upgrade requirements. The production's value can still be estimated either by the equivalent market rate of the good or by the cost of making it. When the government pays people to build housing that they give away for free there is still "production". When the government orders a mine to ship steel to another location the workers are still paid. When the government orders a mine to produce for no input and doesn't bother to maintain equipment they effectively take a loan against the capital equipment in the mine. Eventually the mines productivity falls to zero as the mine fails to remain solvent requiring more capital infusion. If the government can order workers to work without pay then the estimation has to account for similar economics to slave states, which unfortunately is also well trodden ground owing to economies such as the US's prior to 1865. |
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The government may pay people in other things that were the result of direct resource allocation, so you simply cannot put a price to it.
What is the cost of land that the government gives you? What is the cost of a lump of coal? Clearly this is a lot more than the simple capital cost used to extract it.
The long and short of it is, you're not getting a meaningful price is US dollars.