[wvenable]

Let me more specific. I am talking about wealth that is generated by capturing value from existing assets, transactions, and people rather than by producing new goods, services, or productivity gains.

Examples are rent-seeking (making money through ownership, monopoly power, licensing, etc), financial extraction (financial manipulation, speculation, debt, and asset appreciation), housing and land appreciation, middlemen and platform fees, and corporate consolidation.

This is contrast to building factories, software, infrastructure, or goods and services that didn't previously exist. What you might define as "creating".

I don't know how you cannot buy something. You have to have a home, food, transportation, and even entertainment. The extraction economy has come to all of these things. Maybe fewer and fewer things are "worth the money" and that is a bad thing, don't you agree? I feel like you're not approaching this conversation in good faith.

[WalterBright]

> I don't know how you cannot buy something.

Consider rents. You call that extraction. It is not, as when you rent you exchange money for use of the property. If you've ever been a landlord, you'll find out about how much it costs to make a unit available to rent. There are also high risks associated with it - Mayor Mandami is threatening to confiscate apartment buildings that have a beehive in them. Bad tenants can bankrupt you.

I once tried being a landlord. The tenant cost me more money than he paid. I exited that business. An office tower in Seattle recently was sold for about half what the owner paid for it. Oops. The idea that renting out places is free money and risk free is to not know anything about the business.

Selling people food is not "extracting". It's a fair trade - you farm the food, take it to market, sell it, and the customer eats it. You are not "extracting" from the customer.

[wvenable]

When I rent an apartment, I'm obviously receiving something of value in return. The question is where the landlord's increasing profit comes from. If they make more profit from building new housing, maintaining it, improving it, and taking on risk, that's creating value. But if the profit comes primarily from owning a scarce asset that has appreciated because of zoning restrictions, land scarcity, market conditions, or monopoly ownership then no new wealth is created.

A massive number of businesses have failed in my city due to high rents. There are actually a good amount of commercial vacancies and in healthy market you would expect landlords to lower their prices to attract tenants -- but they don't. The actual value of the property is increasing at a rate that they actually don't have to rent out the space. The economics make it better for it sit empty. This is effectively destroying wealth for small business owners.

Selling food isn't extraction. Growing more food, improving yields, creating better products, and serving more customers is wealth creation.

My point is that an increasing amount of economic growth doesn't come from producing more value. It comes from finding ways to extract more revenue from existing value. Smaller packages for the same price, subscription fees, service charges, planned obsolescence, monopolistic pricing, rent increases, financial engineering, and other mechanisms that increase profits without a corresponding increase in output.

In other words, "growth" is being driven by capturing a larger share of the pie rather than making the pie bigger. Just look around, this is what everyone is complaining about!

[wakaru44]

They seem to be making an effort to not understand.