[apantel]

The system is not perfectly efficient because humans aren’t efficient. I think the idea is, keeping a market relatively free (with a sane amount of regulation) allows capital to seek returns. This leads to a lot of independent, decentralized value production, like startups popping up out of nowhere because some founders have an idea and attract capital.

The thing is, people who pile up capital don’t have to be efficient with it. They can basically do whatever they want with their money. They can build giant vanity estates, which you could certainly call inefficient — who needs 20,000 square feet for a family of 3? But… we also care about freedom, so we let people do inefficient things. The only difference between rich people and poor people is they have more money so their inefficiencies are louder. But everybody spends money on senseless wants and vanity. Who needs manicures and hair extensions? Arguably nobody. The “poor” spend on vanity too. And we let them because we care about freedom.

If you wanted to implement a perfectly-efficient system, would that mean banning the fulfillment of any desire that wasn’t strictly a need? I don’t think anyone would want to live in such a system.

[andrepd]

>If you wanted to implement a perfectly-efficient system, would that mean banning the fulfillment of any desire that wasn’t strictly a need? I don’t think anyone would want to live in such a system.

Holy mother of slippery slopes x) Do you think $current_economic_system can be improved? Ah so you want to ban fulfillment of any desire? Sheesh

[apantel]

You’re strawmanning. I was caricaturing the call for efficiency by blowing it up into a monster. I wasn’t saying I want to ban fulfillment of desire, or saying that’s the only alternative to the status quo.

[entropicdrifter]

The irony of accusing the other person in the conversation of strawmanning while describing your own strawmanning as "caricaturing" as if that were any different

[hellojesus]

Efficiency is measured exactly by people maximizing their utility subject to their preferences and constraints.

What you see as vanity, such as hair extensions, may be a high utility item for others. Consider the hair extensions make them a more attractive mate and provide them the opportunity to breed with a better stock, for example.

Similarly, consider that 20k ft sq mansion in context: all the prior owner(s) of that property were traded revenue for the land. And the construction workers were paid. And now the gov gets taxes.

At every step, each contributor to the end product voluntarily participated and maximized their outcomes. That is maximally efficient, economically speaking.

[bccdee]

> That is maximally efficient, economically speaking.

It is not. The resources which went towards that mansion would be (by your definition) much more efficiently spent elsewhere. The utility which one wealthy person gets from a 20k sqft mansion is much smaller than the total utility which 20 homeless people would get from a 1k sqft apartment.

[hellojesus]

What utility is the person from whom you stole wealth getting from homeless people being housed vs their mansion?

My answer is economically efficient. Yours is utilitarian. I believe in private property.

[apantel]

Yeah I’m all for these things that I was calling “vanity”. I was only using the word vanity because the comment I was responding to used it pejoratively: “vanity projects”.

[bccdee]

> The only difference between rich people and poor people is they have more money so their inefficiencies are louder.

Yes. Their inefficiencies are deafeningly loud and have a massive impact on the rest of us. This is why I am suggesting that we intervene to get rid of the ultrawealthy as a class.

> If you wanted to implement a perfectly-efficient system

Stop right there. Don't pretend that "what if we got rid of billionaires" is a slippery slope towards a society of perfect clones where all individuality is suppressed. You don't really believe that—you're just fishing for gotchas, and it's beneath you.