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by Noxchi 4165 days ago
Economic activity is the process of changing things.

For example, a lumber will chop down trees and sell them for $5000. He changes forest into logs. A house builder will buy those trees, and then take the money he has saved and pay someone to make the planks, another person to nail them, and another person to do all the other things needed to make a house. This person changes some wood and metal into a house.

He will then put this house on the market and someone will offer him $30,000. His total cost was $15,000 and by selling this house he has paid back what he invested and has an additional $15,000 he can reinvest.

This person made more money than you (the laborer) because he changed more things. He changed some wood and metal into a house, while you simply changed wood into a plank as directed by him. Sure, he hired you and 3 other guys who technically did all the work. But this is a situation where the sum is vastly more than the total of the parts. You were the cogs in his "house building system".

If you don't like where you are, figure out how you can change this world more so than how you are now.

1 comments

Not really, the builder made more money because they took on more risk: they bought land speculatively, they took on a massive loan, built a house on speculation that someone will want it. Lumber took on much less risk to chop a few trees and sell a commodity that has a defined market value. Better analogy is the lumber who took on debt and grew into a massive organization that buys land, processes trees into lumber and sells wholesale. This is more of what a home builder is and there are plenty of very large, rich timber companies.