The 1 Basic Economics Principle People Misunderstand

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  • Economics can be a complicated issue, so I've removed most of the complexity and got down to the core of the issue. It turns out that money isn't what most people assume it is. And yes, after several arguments in the comment sections of my videos where certain people assumed they knew how economies worked, I thought it best to make a video to clarify why they're mistaken. I'm fairly certain they won't listen, since that's their nature, but it's worth explaining it for everyone else so that you don't get mislead by the claims of those people in the future.
    Some of you expecting history videos may be wondering why I've covered this topic. Well, I can't cover Lend Lease, or certain other non-war topics which I've promised to cover, unless we get the basics down. This is one of those basic videos which will enable me to move onto other history topics.
    Please check out the pinned comment below for more information, notes, links, and sources. Also, please consider supporting me on Patreon and help make more videos like this possible www.patreon.com/TIKhistory
    Academic Agent's response video tvclip.biz/video/QPqPnWTaMrE/video.html
    Learn Liberty also says the exact same thing in their video "Why Not Print More Money?" tvclip.biz/video/ZkyBnaYCUhw/video.html
    Here’s some other videos you may be interested in -
    ReasonTV “This LA Musician Built $1,200 Tiny Houses for the Homeless. Then the City Seized Them.” tvclip.biz/video/n6h7fL22WCE/video.html
    Academic Agent’s “The Origins of Money” tvclip.biz/video/fWDn1-dyXDg/video.html (watch first) and “Understanding Inflation” tvclip.biz/video/nnisOz2nGFc/video.html
    Academic Agent’s “Why Workers Are Not Exploited in the Free Market” tvclip.biz/video/iIONcSbrxbQ/video.html
    “Does Capitalism Exploit Workers? - Learn Liberty” tvclip.biz/video/4Ttbj6LAu0A/video.html
    Thomas Sowell explains “Trickle Down Theory” myth made up by Marxists tvclip.biz/video/nZPDpk8NA-g/video.html
    Valuetainment’s “How to Start a Business for under $500” tvclip.biz/video/rKAAzZFLPEs/video.html
    Milton Friedman’s “The Robin Hood Myth” tvclip.biz/video/5Wx5PYZIWcQ/video.html ||| and "Monetary Policy" (explaining inflation and showing inflation in different countries through charts) tvclip.biz/video/6LfUyML5QVY/video.html ||| and “Understanding Inflation” tvclip.biz/video/GJ4TTNeSUdQ/video.html ||| and “Case Against Equal Pay for Equal Work” tvclip.biz/video/hsIpQ7YguGE/video.html ||| and “The Great Depression Myth” tvclip.biz/video/dgyQsIGLt_w/video.html
    ReasonTV “The $15 Minimum Wage Is Turning Hard Workers Into Black Market Lawbreakers” tvclip.biz/video/0fsVI3EmUnQ/video.html
    This video is discussing events or concepts that are academic, educational and historical in nature. This video is for informational purposes and was created so we may better understand the past and learn from the mistakes others have made.
    History isn’t as boring as some people think, and my goal is to get people talking about it. I also want to dispel the myths and distortions that ruin our perception of the past by asking a simple question - “But is this really the case?”. I have a 2:1 Degree in History and a passion for early 20th Century conflicts (mainly WW2). I’m therefore approaching this like I would an academic essay. Lots of sources, quotes, references and so on. Only the truth will do.

Comments • 80

  • TIK
    TIK  Year ago +99

    *PINNED COMMENT*

    I highly recommend Henry Hazlitt’s “Economics in One Lesson” as a good, straightforward and accessible introduction to economics.

    Effectively, I removed ‘cost’ in this video in order to get the point across about production being the principle that increases the living standards of the whole of society, not money. However, if you add it back in, the fundamental principle still applies. Cost would have needlessly complicated the explanation, even though the outcome would have been the same. Also, the production and scarcity principles are the reason why an economy is not finite (there will always be more to do, and the economy can always expand) and that economics is not a “zero-sum game”. And before anyone says it - I am not advocating “trickle down economics”, since this is a term invented by the Left and doesn’t actually exist, as Thomas Sowell points out here tvclip.biz/video/nZPDpk8NA-g/video.html

    It’s clear when there’s only 10 people in an economy that production is what matters most. But when there are millions, or billions of people, this factor gets lost. The reality is, if we all hypothetically produced twice as much, we’d have twice as much, without needing to increase the money supply. Yes, individuals who have more money in our society have more access to more resources. However, if you want to improve the lives of ALL the citizens of a nation (or the globe) the only way to do it is to increase production, not money. Moving wealth down to the poor earners does not increase living standards. Higher production does. This is a fundamental concept of economics, and is the element that has caused the industrial revolution and subsequent explosion of living standards. The graphs in the article I’m about to give (especially the third graph) are an indication of the drop in global poverty over the previous two centuries as a direct result of this boom in production, innovation and technology ourworldindata.org/extreme-poverty

    There are two important schools of thought that theorize how a product gets valued (there are more but again, simplicity). The older one (going back many centuries) is known as the “Labour Theory of Value”. This is the idea that the amount of work put into a product by a labourer will determine the product’s price. The more modern “Subjective Theory of Value” put this idea to bed. An item is worth what the purchaser is willing to pay for it. So, which is correct? Well, you can buy shirt for a couple of pounds/dollars because they’re dirt cheap to produce. And yet, Manchester United shirts cost tens of dollars. Why is that? Is it because the workers who make Manchester United shirts spend many more hours crafting the shirts? Or is it because you have a bunch of Manchester United fans who really really really want to support their team and so are willing to pay more for their shirts? That’s right, an item is worth what the purchaser is willing to pay for it, and the Subjective Theory of Value wins hands down. If only one loaf of bread was baked in an economy, the price of that loaf of bread would be very high because of the scarcity/supply principle - again, nothing to do with labour. Second hand goods sold on Amazon are determined by the rarity and the willingness of the purchaser to pay for them. A thirsty guy in a desert would really want a drink of water, which someone who’s got access to a tap. Again, nothing to do with labour, and everything to do with the subjective value of the items.

    At ~07:45 in the video, when talking about the extra clothes factory, I forgot to mention that the price of the goods would have to come down as well because of the excess amount of goods in the economy (supply and demand). But the excess food means that a second factory can be supported by the food produced. Then any innovation in either factory would either decrease the price of goods or spur another factory to be produced. And the cycle repeats. The only issue is if the economy has enough workers (especially new ones via population growth), which I also didn’t include in my super-simply scenario because it would complicate things.

    This is also the reason why Universal Basic Income doesn’t work. You’re effectively just increasing the cost of items, by reducing the supply of those items (since there’s only so many to go around). You’re also decreasing production across the economy as workers choose not to work. Worse, you’re directly taxing the rich (preventing investments into production), and taxing everybody’s savings through inflation (preventing investments again). It also stands to reason that even if the robots did come and produce 100x more stuff than a human worker could, it would still be beneficial for humans to work, because even if they only produced 1% of the goods, they’d increase living standards by 1%. Everyone would be better off. Plus, much like health, there will always be more things to produce since there is no limit to the amount of goods that we can produce. We could always have more food, clothes, roads, cars, houses, laser rifles... What the goods being produced will depend on future technologies, or perhaps humans will simply no longer produce raw materials but stick to service sector jobs, or entertainment jobs (like TVclip) etc. But ultimately, it’s in all our best interests if we all continue to work.
    The Housing Crisis in the UK (now referred to as a “bubble on a bubble”) is caused by the centralised state “Planning Permission” and height restrictions, but also several other issues like government “first time buyer” loans and grants, and “Help to Buy” schemes are giving taxpayer money to people who banks won’t lend money too (because they’re not trustworthy and therefore a definite risk, plus the government has crippled the banking industry) in order for them to buy their first property. Therefore, they government has tried to fix the problem they created in the first place, and now are causing a further increase in the demand of housing (since these people wouldn’t have been able to afford to buy a house normally anyway due to their poor credit scores), thus deepening the Housing Crisis. In the future when higher interest rates return, these people will default on their mortgages and usher in a bigger recession in the housing market than would have normally happened. And in the meantime, the taxpayer is subsidising the whole crisis. It’s a colossal waste of resources which is hurting everyone and hindering the economy. Similarly, the same principle - government causing a problem, then sending in someone else to fix the problem - is applied throughout the economy.

    When talking about US housing, Thomas Sowell said in ‘Housing Boom and Bust’ - “A fundamental misconception of the housing market existed both during the housing boom and after the bust. That misconception was that the free market failed to produce affordable housing, and that government intervention was therefore necessary, in order to enable ordinary people to find a place to live that was within their means. Yet the hard evidence points in the opposite direction: It has been precisely where there was massive government intervention, in the form of severe building restrictions, that housing prices skyrocketed. Where the market was more or less left alone - places like Houston and Dallas, for example - housing prices took a smaller share of family income than in the past.”

    Friedman - “Government is necessary to preserve our freedom, it is an instrument through which we can exercise our freedom; yet by concentrating power in political hands, it is also a threat to freedom.” (From ‘Capitalism and Freedom’) and he also said - “Collectivist economic planning has indeed interfered with individual freedom.”

    A capitalist isn’t necessarily someone who’s rich. You can just have some savings and start a business with them. Here’s a video explaining how to start a business for under $500 tvclip.biz/video/rKAAzZFLPEs/video.html

    Also, please see Academic Agent’s video on “Understanding Inflation”, link in the description. His video on the Origins of Money is also good.

    *SELECTED RELEVANT SOURCES/BIBLIOGRAPHY*

    I have read and watched more than this (videos in the description), but these were the books and videos that are most relevant to this particular video.

    Friedman, M. “Capitalism and Freedom: Fortieth Anniversary Edition.” university of Chicago, Kindle 2002. (originally published in 1962)
    Hazlitt, H. “Economics in One Lesson: The Shortest & Surest Way to Understand Basic Economics.” Three Rivers Press, 1979.
    Hoppe, H. “A Theory of Socialism and Capitalism.” Kindle.
    Kershaw, I. “Hitler: 1936-1945 Nemesis.” Penguin Books, 2001.
    Marx, K. “Capital: A Critique of Political Economy: Volume I Book One: The Process of Production of Capital.” PDF of 1887 English edition, 2015.
    Muravchik, J. “Heaven on Earth: The Rise and Fall of Socialism.” Encounter Books, Kindle.
    Newman, M. “Socialism: A Very Short Introduction.” Kindle.
    Smith, A. “An Inquiry into the Nature and Causes of the Wealth of Nations.” Kindle.
    Sowell, T. “Economic Facts and Fallacies: Second Edition.” Kindle.
    Sowell, T. “The Housing Boom and Bust.” Kindle.
    Full list of all my WW2 and related books can be found here docs.google.com/spreadsheets/d/114GiK85MPs0v4GKm0izPj3DL2CrlJUdAantx5GQUKn8/edit?usp=sharing

    Thanks for watching!

    • Corona Virus
      Corona Virus Year ago

      Learn Socialist Justice Look up Segmented Pricing.

    • State Socialism
      State Socialism Year ago +3

      Since the other 5 people NEED to eat or die, why wouldnt the first 5 capitalists just charge $20 for bread and maximize profits? That is what a good capitalist would do

    • Corona Virus
      Corona Virus Year ago

      TIK Real issue with houses is too much population. UK has gone from 55 to 65 million, soon as the boomers start dying there will be a surplus of resources though.
      Universal wage could work, provided everyone gets it & it is only enough to cover the basics. Most people would work or produce something. Those that didnt would struggle.

    • Darth Revan
      Darth Revan Year ago

      Luxuries goods that are produced exclusivly by poor without the inetrference of rich capitalists. By the way killing the corucen ca be done by buying the otehr.

    • Darth Revan
      Darth Revan Year ago

      20:20 Make sens in an imperailist contexte ! But instead of buying teh food itself they buy the mean of producing said food.

  • sjsu pa
    sjsu pa 18 days ago

    What are you talking about? The 100 pound profit represents 10 loaf of bread. So if the owner give away all his profit, the workers will have 2 loaf of bread instead of 1 loaf, therefore the standard of living would improve.

  • Grease monkey
    Grease monkey 19 days ago

    Produces Basic Economics video. People complain it's too basic! 😂

  • G D
    G D Month ago

    I like your story as a way to explain the system. The Soviets had relatively little to buy with Roubles .. so bartering or crime became the way to improve ones wealth. One problem is that when jobs leave , new ones don't always come back to the same area that lost them. This may be more a problem in larger countries than smaller ones... I don't know.

  • atzuras
    atzuras Month ago

    At first I thought it was a joke... this is not how it works.
    I hope time will eventually show you how it really works.

  • Chris Plumb
    Chris Plumb 2 months ago

    Everyone starts with £10 - except the guy with 100 to invest, how did he get it in the first place?

  • jack delaney
    jack delaney 2 months ago

    722 dislikes?

  • Old Gringo ランス
    Old Gringo ランス 2 months ago

    I'll pit Doctor of Economics Stephanie Kelton against Journalist Henry Hazlett any day, Or Dr Bill Mitchell or Dr Stephen Hail. #LearnMMT

  • Old Gringo ランス
    Old Gringo ランス 2 months ago

    Fact: Henry Hazlett was NOT an economist (he was a journalist) Also Austrian or Chicago schools of Economics are pro Austerity, not my cup of tea. Beardsley Ruml (1940s NY Fed Chair) once said "taxes for revenue are obsolete" (taxes, however are NOT obsolete, taxation in the USA is regressive though, most people ARE taxed too much) just my two cents.

  • maico van de wiele
    maico van de wiele 3 months ago

    SOCIALIST AND COMMUNIST HAVE LEFT THE CHAT

  • myroseaccount
    myroseaccount 3 months ago

    I would stick to military history. Your videos on the eastern front are very good and there are plenty of other conflicts and historical events worthy of analysis. But your attempts at conveying political economy, in even the most basic forms appears, to be polite, less than effective

  • werty werrtyson
    werty werrtyson 4 months ago

    While interesting in theory I don't agree that countries with less tax has better living standards. Here in Scandinavia we have more tax than most countries but our standard of living is high. Our productivity is high compared to most of the world. We produce more per person than the average American. And the capitalistic utopia seems as unrealistic as the socialist utopia. You need capitalism yes but you also need some checks to make sure that not all the money ends up with just a few owners of industry who don't contribute much. It is the middle class that is contributing the most to the economy not the working class like in a communist state but also not the capitalists owners. Anyway I like your channel and you certainly have interesting ideas about history and politics and I believe in free speech and discussion so keep on.

    • werty werrtyson
      werty werrtyson 4 months ago

      @TIK It is possible the total GDP would be higher with less tax but the distribution would also be more unequal. With parts of the population living in shanty towns or ghettos like you see in some countries. We would have more rich people but also more poor. Also the tax helps pay for things we otherwise would have to pay to companies. Like health care. When I got severe burns for example because an accident with burning oil i got basically free health care and it costed me nothing except pain but in the US i would maybe not have afforded health care or lived in debt after surgery. I have watched a lot of your videos lately and I find them interesting. I agree with a lot and the videos about nazi and fascists being forms of socialism were eye opening. However I must admit that some things you say I cannot agree with. A bit of state intervention is needed especially for people who cannot work as hard because they are sick or have mental issues. True capitalism would mean the survival of the fittest with the weak who cannot make enough money will perish and I cannot see that as moral. However low levels of corruption is needed otherwise tax money goes straight into the pockets of politicians. Just as you mentioned there can be bad capitalists there can also be bad politicians. Which is why democracy is needed to vote out the bad ones and elect better ones. Id love to know more about your political views. As you mention in one of your videos you need to know the source of your history and since you are becoming one of my sources for history I want to understand more where you are coming from politically. Keep up the good work. It is good to question history as you do but I will also keep questioning you as is proper to do with anything.

    • TIK
      TIK  4 months ago

      Yes, and your standard of living would be even higher if the government wasn't consuming resources that could have gone into the production of consumer goods. Your living standards are only high due to previous years where government consumption was low. Now it is high, it's slowing growth of the economy and squeezing living standards.

  • NinjaSheep
    NinjaSheep 5 months ago

    Very simplistic video albeit by design. Not bad overall though in the west countries which are more capitalistic tend to have a lower cost of living.
    Now zooming out it’s not the end all be all to have low cost of living but as a standalone good video.

  • matt baker
    matt baker 5 months ago

    hi tik have you read the book the sins of high finance by theodor Fritsch? would like to hear your opinions on it

  • John - B
    John - B 5 months ago

    I mean this in the kindest way, but you should stick to WW2 videos. Consider your example of Adam Smith's pin factory. The story was about the increases in production gained by the specialization of labor (e.g. one to spin the wire, one to shape the end, etc). If you have specialized labor, you now have to decide who is more productive in your system (e.g. is the person who makes the end worth 3 wire spinners?) in order to determine a fair wage. You also assume zero transaction costs of production and distribution -- remarkably unrealistic.

    As I said, you do good war videos. Stick with what you're good at and you'll see your income increase (basic economics).

  • Stephen Butler
    Stephen Butler 6 months ago

    I remeber covering this and the flaws of the 'fair trade' scheme back in 2004 in year one economics. Its good for marketing though.

  • C Lam
    C Lam 6 months ago

    He did said it's a simplified model to make a point. And that's exactly what he did.

  • Real AdolfHitler
    Real AdolfHitler 6 months ago

    You do ww2 history not economics

  • Howard Thompson
    Howard Thompson 6 months ago

    I understand your motivations here, but you simplified the example so much, and actually constructed the example in such a way, specifically to support your point of view that it became almost meaningless.

  • seven
    seven 7 months ago

    never mention the word "profit". Why?

  • Misty Moor
    Misty Moor 7 months ago

    Is Economics so simple? Is there only one way of looking at it ? I would disagree with that. So many things not explained. What a bout boom and bust, what about the 5 guys who are unemployed, what about the ones who don't get offered a job? What if there aren't enough people without a job when the new entrepreneur is looking for workers. what about the theory that for the Capitalist system to work there must be always a percentage of unemployed people to be available when new businesses start up and are looking for workers? How are all these fluctuations and problems catered for ? I'm not advocating for Socialism, I have seen the flaws in that philosophy but I think there are a lot of unanswered questions !

  • Aaron Seet
    Aaron Seet 7 months ago +1

    Those 3 guys may not be producing physical products, but they are providing very tangible _services_ that require time and skill .

  • Giovanni Romanelli
    Giovanni Romanelli 7 months ago

    This is great!
    If human beings actually did what is objectivelly the best for everyone 100% of the time, which totally is the world we live in right?

  • Lily Tide
    Lily Tide 7 months ago

    This video is incredibly goofy and shows a clear lack of economic understanding. Im not sure why you made it.

    • Ireneusz Pyc
      Ireneusz Pyc 7 months ago

      @Lily Tide "..a video with a complete lack of economic understanding.." - you're another socialist & hypocrite

    • Lily Tide
      Lily Tide 7 months ago

      @Ireneusz Pyc how would making a video with a complete lack of economic understanding help him achieve that goal?
      and what makes you think that was his goal anyway?

    • Ireneusz Pyc
      Ireneusz Pyc 7 months ago

      he made it to find out how many socialists & hypocrites are out there, and the comment section proves that there are thousands of those

  • Bhangra Fan
    Bhangra Fan 7 months ago

    If there is one FIRST LESSON in economics theory everyone should have it is the difference between DEMAND and EFFECTIVE DEMAND. This is illustrated by the "Fallacy of Two Billion Armpits".The (very thick & inexperienced) owner of a deodorant factory saw that China was opening to the west, so he thought he would have a great opportunity to get rich selling deodorant to Chinese people. One billion people that's two billion armpits, big market. WRONG! At that time very few people in China had much money to spend and their spending priorities were food, fuel and housing, leaving nothing to spend on deodorant. In economics demand does NOT mean how many people want something, it means EFFECTIVE DEMAND, that is how much money is available in the market that people want to spend on buying deodorant at each price.

  • Bhangra Fan
    Bhangra Fan 7 months ago

    You do not understand some basic things. When one technology or business goes out of fashion etc., and lots of people are laid off there is no guarantee they will be re-employed. Look at what happened in the industrial waste lands of the USA & UK (Trump supporters & Brexit voters). For those unemployed people to be offered new work there must be at least two things present: capital investment and demand for the goods and services that the capitalist is intending to invest in. Often this does not happen so people relocate to elsewhere where the economy is more active. There is no guarantee the job they get will be with better pay and conditions. There are all sorts of factors you cannot cover with your approach.

  • Bhangra Fan
    Bhangra Fan 7 months ago

    Now I will give you a lesson in practical business. Most people can never start their own businesses because they cannot get enough capital together to start. A bank will not invest at all in someone who has no business track record. If you have a moderate business achievement behind you they may lend you something but only if you put a big wad of your own money in first. This is why people embezzle from their employers, run drugs and rob people so they can get together a few tens of thousands of pounds to start on their own. Once people start in business they quickly learn this: that it is hard slog seven days a week, no holidays, few luxuries and they still are getting deeper and deeper into debt with poor profits appearing. So in the vast majority of cases either they sell the business on to someone with more behind them, they go bankrupt, or they just give up as it's not worth the effort. Now there are people who make big profits in business, but they know a few dirty secrets. No one makes a big profit in business unless they have an 'angle'. Angles include using inside knowledge or contacts, monopolist practices and rent seeking. Most people making a lot of money in this country now are using one or more of these.

  • Bhangra Fan
    Bhangra Fan 7 months ago

    WOW.. not only do you not know anything about academic economic theory, you don't know anything about practical business either! I can see why you have so much time to make these videos. I like this.. "You go to the bank and say I used to work 12 hour shifts in a bakery for minimum wage, I've got a great business idea, give me £50,000 and he says Great!" Please go and try this. Haaa Haaa Haaaaaa Haaa!

  • Bhangra Fan
    Bhangra Fan 7 months ago

    Why are you making lectures on economics if you don't know anything about it? You should stick to what you understand.

  • gary jones
    gary jones 7 months ago

    How come supply side economics always enriches the rich and bankrupts the economy? Because taxpayers have to bail out the sinking ship or drown. Perfection!

  • CRISPEDEWE 44
    CRISPEDEWE 44 8 months ago

    Rent extraction, or the FIRE secrtor, is why this doesn't work. Plus isnt that leach of an "army" stopping someone nicking all the bread, and although the army is guarding the factory the workers are probably paying their wages as I am thinking that the factory was probably built with a nice tax incentive.

  • Lord Fancypantaloons
    Lord Fancypantaloons 8 months ago

    Employers do not have as large of a time constraint on finding workers as workers do on finding employment, so by needing to eat and pay bills their bargaining position for higher wages is undermined if they have little or no savings or capital, if you will.
    Economists assume that people are rational and that people get rewarded for their work, but now you have issues of wage stagnation even though productivity goes up year after year (Solow Model and others).
    Yes, regulations inhibit growth, but it's not only money that matters. Buildings, goods and services need to be safe to use and consistent in quality, while communities need to be safe and governments stable. This is why Eritrea, Nigeria and Sudan see no investment from the West, because those governments cannot guarantee stability and private property rights. China has effectively seized the port of Mumbasa to guarantee safety for crews and cargo.
    Regulations also spared Canadian financial institutions during the 2008-9 recession, namely the ban on purchasing speculation grade securities, whereas the biggest bank in the US, Bank of America, nearly collapsed itself.

  • Phillip Lenz
    Phillip Lenz 8 months ago +1

    Love it. All the socialist cant handle the idea that you get out what you put in.

  • bj0rn
    bj0rn 8 months ago +1

    First of all, capitalists and managers are apparently not part of the economy. Secondly, government employees apparently have zero productivity (produce zero loafs), so they are basically leeches on the output of real workers who work in the private sector; but managers and capitalists, on the other hand, are somehow useful and earn according to their productivity? I mean come on, at least be transparent about your assumptions.

  • bj0rn
    bj0rn 8 months ago

    This video is about how to argue for the abolishment of government using intellectually dishonest economic modeling.

  • Don Makiavelli
    Don Makiavelli 8 months ago

    i got an example which is more simple, there is two ways of getting money, to work, or to own, and those who work, pay for everybody, including those who doesnt work but only own, and those who own cant get money only by owning things, but by using those who dont own, and therefore they sell thier labor force, capitalsm isnt a law of nature, its the ideological expression of the ownership.

  • Maxotics
    Maxotics 8 months ago

    Put these on your reading this. www.amazon.com/Debt-First-5-000-Years/dp/1612191290 and www.amazon.com/Free-Nation-Deep-Debt-Financial/dp/0691126321 I agree with you that "Oil" is what WWII became about. But Credit (which the French didn't want extended to Germany) is what drove Germany into a corner. Look at today. Is the U.S. bombing Iran? Nope, they're cutting off its credit, essentially. Same for Russia. Yes, you can still look at it that Germany wanted food, but if it had credit it could have bought it. What is the current trade war, but credit to domestic production. I LOVE your military history videos. A better understanding of how debt/credit has worked for thousands of years will open your eyes to some VERY INTERESTING things that happen and happen to this day.

  • Ali Hassan
    Ali Hassan 8 months ago +1

    Wait. Aren't you the history guy? Or economics guy? Are you sure you are going beyond your expertise? I subscribed you for history and now you are talking about capitalism and loaf of bread :S

  • Pedro Parica
    Pedro Parica 9 months ago +1

    Basic economic principle you misunderstand. 1. Rich people do not get rich by working hard and they do not always invest in productivity. They use their money and power to bend politics and the market rules in their favour.
    2. Unregulated economy only leads to monopoly.
    3. Why a country like Sweden has no poverty? Its thanks to the State, their taxes and redistribution.
    Free markets alone generate unequality and poverty. The big fish eats the small fish.
    Since you claim to be "unbiased" you should also learn economy from other sources, and not only from right wing and Friedman.
    Your version of economy is like reading history only trough Halder.

    • Pedro Parica
      Pedro Parica 8 months ago

      @GrimFaceHunter
      Are you telling me that Sweden has an unregulated economy and the taxes are low? Lol. I think you are wrong. You need to further check that out.
      Aha so unregulated economy does not lead to monopoly? Well ask Bill Gates about that. He can give you a lesson on how to eat smaller fish taking advantage of the "market freedom".
      No capitalist wants competition. Ask yourself why.
      Ah you are forgetting the fact that capitalists put their friends in the government. They even finance their campaings. The government is not separated from the capitalists and oligopolies. They work together. For example The president of my country (Macri) is the best REAL example ever. He owned a car factory in the 70'. But he bankrupted...but oh what a coincidence...the minister of economy back then was his friend. So the minister of economy by decree in the name of the State ABSORBED his debt and financial disasters...and now we are all paying it. That is a example of real life politics and economy and not some theoretical rhetorical bullshit made up in a libertarian classroom sitting and imagining a capitalist fairytale. The capitalists and the goverment work together! They help eachother.
      The libertarian arguments are so naive that it almost seem like they were made by a 10 year old.
      But i wish that was the case because in actuality is just a group of mercenaries working to justify the injustices in the system and working in favour of the rich against the poor.

    • GrimFaceHunter
      GrimFaceHunter 8 months ago +1

      1. "Rich people do not get rich by working hard and they do not always invest in productivity. "- "Working hard" is one of the worst phrases that is thrown around, since it lacks nuance. You may be inefficient, doing wrong stuff or you can even be counter productive and all the while you are working hard.
      "They use their money and power to bend politics and the market rules in their favour." - That's an argument for getting government out of the economy. If there is no government that can pick favorites, than nobody will try to bribe it or influence it otherwise.
      2. " Unregulated economy only leads to monopoly." - Historically, complete opposite has happened, the only monopolies that are both persistent and at the expense of the consumer have been those that are maintained by governments.
      There are two kinds of monopoly: Coercive monopoly which is the one that is achieved and maintained with the help of the state, since coercion is enforced through the state;
      Monopoly through efficiency, which is achieved and maintained by being the producer with the highest quality with the lowest price. This kind of monopoly isn't detrimental to consumers and can only be maintained by improving quality and reducing prices.
      3. "3. Why a country like Sweden has no poverty? Its thanks to the State, their taxes and redistribution." - This ignores actual economic history of Sweden. It only got rich after deregulation in the middle of 19th century. In 1950's they adopted various socialist policies and that nearly ruined them. Dropping those policies and reforms in 80's and 90's saved them.
      "Since you claim to be "unbiased" you should also learn economy from other sources, and not only from right wing and Friedman."- None of this is from Friedman. "Economics in one lesson" was written by Henry Hazlitt and it doesn't push any right wing ideology in any way.
      This is also ad-hominem, since you decided to attack the source instead of providing any counterargument.

  • Pedro Parica
    Pedro Parica 9 months ago +1

    I have to disagree in many things. Not all products are the same. Also there are groups (corporations) that have more power than others and are able to influence prices, politics and the rules of the market in their favor. Your view is too naive. The way some groups steal is not direct. Corruption is functional to them and part of the equation. Some groups even get their wealth not by production but by contracting external debt or financial speculation, which then the rest of the society has to pay.
    Anyway Lets say a worker produces cars and each worker gets 1 car as a gift...is not that they will need a new car every day from the production line. It cannot be compared to the production of bread.
    And also...this idea that communism should be impossed to replace the evil capitalism is not quite right niether. According to Marx communism is a system that will follow after capitalism has fully developed and worned out. Capitalism is irrational, it produces too much garbage and wastes too many resources in order to survive,which is not sustainable over time. Planificated production some day will be mandatory, like it or not. All the fancy and useless stuff that capitalism generates will be gone some day.
    The communist revolution is only there to overthrow a dying capitalism similar to what happen with european monarchies. We cant forget that Marx was hegelian.
    The biggest irony is that Marx would agree with you in praising the bourgeoisie! Let the bourgeoisie grow! Dont stop it. He wanted capitalism to fully develop itself until the point it falls for being to wasteful and for generating to much unequality and trash among other things. He tried to see and explain the end of the picture.
    The other big issue you "forgot" to mention is that increasing productivity too much generates unemployment and therefore poverty and crisis. So productivity in capitalism has a lot of limitations which are not solved.

  • Mr Murica
    Mr Murica 9 months ago

    Missed opportunity you didnt call the bakery "the nakey bakey"

  • TheGadsdenGuru
    TheGadsdenGuru 9 months ago +2

    honest to fuck i feel so bad for TIK.

    his whole fanbase is filled to the brim with Misguided Communists who think that the Anti-capitalist large foreign policy of the US government to overthrow and install puppet governments in 3rd world countries is capitalism.

    well I'm a libertarian TIK and i support you, and the Nazi's socialist video.

  • AmberT
    AmberT 9 months ago +7

    Pls dont talk about economy any more.

    • Akiva Abraham
      Akiva Abraham 8 months ago

      @AmberT
      They do claim that Capitalism does not work though.
      Even the Stormers and conservative, who are supposedly right wing, claim that capitalism doesn't work, in part because it leads to things like the degradation of society through porn and foreign workers.

    • White343
      White343 8 months ago

      AmberT But there is one problem, what happens if the Consumer demands more things from a Supplier like Food and other useful goods that were still in stocks?
      The Producers (The Industry and the Farming Agriculture, the means of Production) made these products while giving it to the Suppliers (The Market) that marketed it to the Consumers (The People) because they want it and people don't want anyone to get sick or getting hungry.
      Suppliers in the Market System needed to restock from the source of production to meet demands to the Consumers. That is Capitalism, that works because anyone can buy whatever they need, it's not the influence of capitalism or money in a society, it's about the demands of the Consumers (The People) but there is only one thing to know that if one Product was expensive than your house bills, you know that is a Scarce Product and were difficult to make and made out of expensive materials.
      The Centralized Economy or in other names like Command Economy or Planned Economy, the Economy was controlled by the Government.
      They (The Government) took the means of production such as the mining and production Industry and Agriculture, resulting that Economic Businesses such as Grocery Stores, Markets and other small companies will get very limited products that did not meet the demands of the Consumers in both quality and quantities.
      The Soviet Union did not like any free Market System within their turf because it promotes Capitalism and they vilify it. Which led many Markets and other Groceries to shut down and only a few were taken control by the Government rather than the Managers.
      Products in Soviet Markets were stocked to full but only at once per week or per month and were in limited numbers and the people, the consumers, need to line up because those Products were limited.
      When Gorbachev visited the Western World and look into American Grocery Stores, they came to realize that their stocks were resupplied per day and came in larger quantities and qualities that meet the demands of every Consumers because Individuals who hold the means of Production give their Products to the Suppliers that meets the demands of every Consumers.
      Because of this, Producers needed money and also the Suppliers and interestingly, also for the Consumers.
      Because the Producers they gave the Suppliers their products and the Suppliers pay them back in amount of values of both quality and quantities until the next products came in and they also needed to pay their own company to keep it alive and fix some malfunctions while the Consumers are hardworking individuals and the half of them were students in training (the People). They earn money while they work for the suppliers or at the Industry (the means of production) that gave them salaries so that they can buy something.
      And this is why the USSR failed when Gorbachev wanted to reform the Economy and no one in the Soviet Union at that time knows about Basic Economics.

    • AmberT
      AmberT 8 months ago

      @White343 Things are difficult. The people on the left don't claim capitalism doesn't work. They argue that it is necessary to get rid of the influence of capital on socially important decisions.

    • White343
      White343 8 months ago

      You need to know how it works before you realize you don't know how it works and keep blaming Capitalism.

    • Akiva Abraham
      Akiva Abraham 9 months ago +1

      Why?

  • David Murray
    David Murray 9 months ago

    I thought you were rightwing. Very theoretical indeed.

  • klo schuessel
    klo schuessel 9 months ago

    Great vid, from ever more socialistic germany.

  • bearshrimp
    bearshrimp 10 months ago +1

    Don't quit your day job.

  • Donald Grant
    Donald Grant 10 months ago +2

    That's unless the capitalist baker goes out and buys a robotics to make the bread. Then everyone starves to death. The 10 workers starves to death because they are out of a job and have no money to buy bread. And the owner starves because he has no costumers to sell to, but still owes on the robotics that makes the bread to the bank. The banker takes everything from the baker and he can't afford to by the bread now and dies. But wait it get better then the banker starves because he don't know how to make the bread and dies of food poisoning. A long slow painful death with stuff shooting out of both ends. The economy ends because of Globalization robotics and AI's. The End.

    • TIK
      TIK  10 months ago +1

      ​@Donald Grant Does everyone become unemployed at the same time in your economy? In reality, unemployment doesn't and cannot hit 100%. Those who lose their jobs (let's say 20%) are in trouble for 6-8 months, while the remaining 80% have an increase in earnings. This, of course, only happens in a free economy. Once you throw socialism into the mix (high regulations, high tax, high inflation they're hiding etc etc etc) then the recession is not allowed to do its job, and thus you get a slow growth economy, which is what we're seeing right now (since 2008).

      You need to look beyond the first step, and look to the next. Yes, when someone is immediately made unemployed, this is bad. But this frees up part of the economy to create more jobs, and thus the unemployed person finds another job (again, if the market is actually allowed to do its job).

      You're saying to me about robots taking our jobs, but I'm actually in a new job, and I'm looking to employ a non-robot soon. New jobs are being created, just not in the old industries. They're being created in newer industries, and industries that haven't been born yet, but will be due to technological increases. Even if robots did take all our jobs, are we just to sit there and rot? No. We will find new things to do that robots can't do - such as entertainment, social, and creative works, if not service and investment etc.

      The only reason robots are taking our jobs is because the minimum wage just keeps rising artificially higher and higher for zero reason. The UK government has just raised it by 38 pence per hour, which is an absolutely insane amount, especially when there are so many unemployed people looking for work. I would have happily hired someone. But this has forced me to rethink my own hiring, since I cannot afford to pay that amount with the old target I had on Patreon.

      I would suggest you listen to Hazlitt's Economics in One Lesson: tvclip.biz/video/8_u2a4uQFNI/video.html

    • Donald Grant
      Donald Grant 10 months ago +1

      @TIK You are right that Economics isn't a zero sum game. Even thought the bread cost less an unemployed man can't even buy the cheaper bread. He has no income. Because this baker has bought the robotics, every baker has to invest to keep their cost down. But that puts more people that actually bake the bread out of work and they can't afford the cheaper bread ether. Now all of the bakers have gone to robotics have no one to sell to because no body has a job, but they have these machines to pay for. With no money in their pockets the bankers take their equipment and their buildings so now the boss is in the same shape as the people who use to bake the bread. The banker starve even though he has all the equipment, but he doesn't know how to make bread. Now I'm just playing with the scenario that is given in this video. But you can move this on to any thing being manufactured or services rendered with robotics and AI's coming. Even though it cost little that doesn't matter to those unemployed because they have no money. It could cost one cent, but if you don't have the one cent it is unaffordable. So as the unemployed become larger and larger of a group then they will turn to socialism. They will have no choice because people like you haven't come up with an answer to what are all these people going to do to make the one cent to buy that bread. Now I'm not effected by this in any way because I got mine. But please fell free to answer the BIG question that is sitting in the corner that everyone in power is avoiding. How do you get money to people when there are not enough jobs for all of the people to buy bread. Come on are you afraid?

    • TIK
      TIK  10 months ago +1

      Economics isn't a zero sum game. The employment of robots reduces the price of produce, which means the consumer saves money on that product, giving them extra money that they can spend elsewhere. That extra money then leads to higher demand in other areas, which then leads to more jobs. Of course, in Marxist economics, the workers can't create their own non-robot businesses or seek employment in new businesses, so of course they starve to death. But in the real world, the economy expands.
      And, due to Keynesian economics (a deeply flawed system), the bankers are actually giving money out left right and centre, which is why we have a massive credit bubble which will burst one day and cause a massive global financial crisis. So that part of your criticism is also untrue - in fact the opposite of what's actually happening. Credit is too easily available. That's actually the problem with our economy, and it's precisely because of Keynesian economics and the fact we (the entire world) no longer have a capitalist economic system, and haven't had one since the ~1920's.
      It's true that the global economy will collapse, but the cause is socialist economics, not capitalism - which is actually the only way to get out of the crisis.

  • Diabeetus Prime
    Diabeetus Prime 10 months ago +10

    Tik: doctorate-level understanding of military history, third-grade level understanding of political economy

  • William Bolton
    William Bolton 11 months ago

    Loaves of bread as Economics lecturer, 2, loaves of bread as War Historian, 13.

  • Peter Grey
    Peter Grey 11 months ago +1

    Taxation and regulation are not necessarily bad, the problem is rather that people tend not to be good at making unbiased comparisons of the benefits (which can include both tangible and intangible benefits) with the costs (which are not only direct costs but the effects of distortions in the idealized free market). Maybe that army is worth the price of a compromise to standard of living, and maybe it's not. But you shouldn't trust the people claim a policy has no cost and you also shouldn't trust the people who claim a policy has no benefit.

  • Samir T
    Samir T 11 months ago

    Great video

  • Thomas Van de Velde
    Thomas Van de Velde 11 months ago

    Hmmm... I understand perfectly what you are trying to do here, but as a history fan myself, a little warning you´ll perfectly understand by comparison: Economics.... Is not an absolute science either! :-) Same as history, there´s bias present, and the definitive solution is yet to come about who´s ´ŕight´. Economics are basically the opposite of history: By learning from our past, trying to improve the standard of living for everybody in the future. So you´re about to slip the thin line between history and future there @TIK and it´s very thin indeed. I slipped across it myself time and again. Also bear in mind, that when discussing Soviet economics (which is a system that lived on untill 1991) you´ve long left the World War 2 arena... And hence are bound to upset a LOT of people. Though it happened to me too, it´s the reason I became politically active, than de-active once more: This is stuff people shed blood over, and seen the fact my father was in the meatgrinder (and my grandfather in WW I) I´ve learned to keep my mouth shut about it hehe :-)
    Regards,
    Thomas

  • johnny1893
    johnny1893 11 months ago

    You are one sad person

  • Артем Токарев

    That's not how economics GROW, it's how economics EXPAND. And that is the whole core of dispute here. Core capitalist economy is extensive, money-work-money based and that way always demands new market to keep growing. And where there is no new market to go for - they need to reduce payments in order to keep enterprises running. And that is where "evil capitalists" are coming from. It's all about inability to switch money-work-money principle to work-money-work.
    That's odd that it needs to be explained (in a dull way,lawl), cause all of this were discussed in 19th century. 20th century proved that capitalism can't keep up, as well as communism. And now we have all greatest states to be with parts of open market(money-work-money), but with state regulation in critical industries, like agriculture, and in high-risk industries, such as nuclear or space industries.
    Funny tho, that USA has followed Mark's principles, while hating commies.
    And just to be clear. I'm not saying that communism>capitalism. They are both outdated now and both proved to be bullshit in its pure form (1929 and 1991). Now we have post-capitalistic economics, with sizable parts of state regulations. USA,UK and all "capitalistic" states do create workplaces for sake of workplaces as well as having social programs.
    We all should stop thinking in 19th century terms. Its 21st century ffs. We have new challenges before us and, probably, new forms of economics

    • Артем Токарев
      Артем Токарев 11 months ago

      TIK
      Private capital is not interested in investing into innovation. That's the prob. I'm talking about true innovation here, not just upgrading or smothering existing inventions. True innovation is high risk affair with low or no benefit. And often those benefits can be gained in 30 or more years only. Pretty much 20th century shows us that. That is where state comes. Space programs, fundamental physics research. Even aviation that is so commercialised now was driven and developed by state through whole 20th century.
      On the "zero sum" note - I had not stated that in my comment. I guess you come to that conclusion cause of my "money-work-money" part of comment. My point was that motivations of those principles are different. In one case you want to generate money as outcome. Benefit. And in this case you doomed to have expansionistic economy and to create virtual markets in case you can't expand. And that what happened after 70th. Also you're doomed to cycle of crisises based on financial bubble that is created by this type of economics.
      Socialistic states tried other approach to economy, which is state-driven. They were focused on creating workplaces and work itself as outcome. That doomed state to stagnation and lots of dead weight in economy.
      Nowadays all major states have some kind of hybrid economics, with different points of balance, even if they try to pretend that it is still socialism (China) or capitalism (USA). Both have parts of other type of economy built-in their state. But in all those cases critical for survival areas are state-controlled. And U.K. Is no exception to this.
      And last of all - I kindly ask you to put away ideological parts from discussion. I do agree, that forms on which socialism was implemented were tyrranical. But I can say same about capitalism as well. Money slavery is still slavery. I believe that any ideology can be used to establish tyranny. And that in any ideology there are good and bad parts. I'm sure, that we need different ideologies to exists and compete so we can see good and bad parts in any of them.
      "If all agrees - no one thinks hard enough"

    • TIK
      TIK  11 months ago +1

      That's not true. Capitalism doesn't need markets to expand into new territory - it can expand internally through innovation and new technologies, as I explained in the video. The idea than an economy is zero-sum, which is what you're describing, has been disproven many times over, as this video explains.
      Also, Capitalism is simply private control of businesses. As in, individuals in control of their own lives. You're suggesting that it's an out of date concept and that individuals shouldn't control their own lives and work. What's the alternative? The state controlling their lives, which is socialism. Well I'm sorry but that's simply tyrannical.

  • ユーネ / Yuune
    ユーネ / Yuune 11 months ago

    If the factory was run by the workers they would take best decisions.

    • TIK
      TIK  11 months ago +1

      Co-operatives aren't socialism. They're just a novel way of managing a capitalist business. They're also not great at retaining their managers because their managers are paid less than the industry average, to compensate for the increased wages for the lower workers and inefficiency in production. While they're doable, they're less efficient than normal businesses.

    • ユーネ / Yuune
      ユーネ / Yuune 11 months ago

      @TIK
      Ever heard of co-operatives? Or is it new concept to you?

    • TIK
      TIK  11 months ago +1

      This statement proves you've not worked a proper day in your life

  • ユーネ / Yuune
    ユーネ / Yuune 11 months ago +2

    Read Marx

    • Torven The Grey
      Torven The Grey 10 months ago +1

      @TIK "I have read it." No you haven't
      " It can't even explain how a Manchester United ..." It can, you would know if you actually paid attention to the debate between Jack and the economicagent where you got this example from. Copyright gives the company a monopole (by the way according to you copyright laws are socialist since it is state intervention in the economy) that allows it to increase market price by limiting supply. Easy enough.
      You should really stop being so cocky when you so obviously don't know what you are talking about.

    • TIK
      TIK  11 months ago +1

      I have read it. It can't even explain how a Manchester United shirt is more expensive than a normal t-shirt. It sucks.

    • ユーネ / Yuune
      ユーネ / Yuune 11 months ago +2

      @TIK
      Marxist economics is a thing that is greatly studied throughout the world. Looking into it isn't a bad idea.

    • TIK
      TIK  11 months ago +1

      Yes because reading the works of social revolutionaries is way better than learning actual economics

  • ユーネ / Yuune
    ユーネ / Yuune 11 months ago +1

    capitalist pig

    • TIK
      TIK  11 months ago +2

      Tyrant

  • Gary Douglass
    Gary Douglass 11 months ago +3

    Thanks for having the courage to approach the subject. If I double the wages of my workforce, I have to raise my prices to cover the increase.

  • Raymond Gill
    Raymond Gill 11 months ago +1

    And the Baker asks "where's my pension?" and the capitalist says "I've bought luxury goods with it" and everyone is happy. The Baker buys the plot of land which has planning permission but it costs 100k not 10k, so the granting of permission has created 90k of value at the stroke of a pen. So they take the 90k and buy pens.

  • tyrone jmal
    tyrone jmal 11 months ago

    Yes sir i too love that good olé reganomics

  • Michael Red Sox
    Michael Red Sox 11 months ago

    What happens when your little bakery pollutes the air for decades until earth becomes uninhabitable?

    • GrimFaceHunter
      GrimFaceHunter 8 months ago

      Like they did and still do in socialist countries?

  • Ebenezer Scrooge
    Ebenezer Scrooge 11 months ago

    Ok the title is correct, the guy shows that he misunderstands the principle.

  • seneca983
    seneca983 11 months ago

    The first example in the video doesn't make a lot of sense. The reason why giving the capitalist's income to the workers doesn't benefit them is because the capitalist doesn't consume anything and just hoards the money taking it out of circulation. That's not terribly realistic. In a more realistic scenario receiving an income transfer does in fact enable higher consumption.

    • GrimFaceHunter
      GrimFaceHunter 8 months ago

      Higher consumption of what exactly? If there is no increase of goods and services to correspond with increased incomes it only results in increased prices of goods. And in the example that is given here it also results in baker's inability to do maintenance on the bakery.

  • Firebird
    Firebird Year ago +1

    Fantastic, TIK. I admire your courage to use reason, logic, and not spin history to suit a vogue ideology or political correctness.

  • too. much. finance.
    too. much. finance. Year ago +2

    "plus the government has crippled the banking industry"

    this is peak stupidity. I shouldn't even have to exlaine why this is wrong. I can't even believe what I'm reading.

  • Samuel Morales
    Samuel Morales Year ago +1

    You need to explore the theory of prices. Where do prices come from? It is not enough to simply give a scenario between an employer and employee because if you add the employer (the capitalist), the socialist and anti-capitalist will automatically discredit your example. If you explain to them where prices come from, the implications debunk their beliefs.
    Prices are related to subjective value but value in itself is not a price. You don't have a price on your pet dog or something of such high sentimental value. You don't have a price on your own life; it is priceless. Prices ultimately come from subjective value of a good but there is an interplay between consumer and producer. The producer is selling goods he/she does not value as much as money. If the consumer buys something from a producer, he/she is valuing the good more than his money at the price they agreed to make the transaction. In this one single instance of trade, both consumer and producer are exchanging something of lesser value(satisfaction) for something of greater value(satisfaction). The diamond and water paradox is explained something like this. Why does a diamond cost much more than a gallon of water? Why does water deliver satisfaction much more cheaply? It is the context of need in such goods. A person who is very thirsty will value water more than his diamond while a person with a water wail would value the other person's diamond more than his/her water.
    Prices are the result of ultimately subjective value interplay in the market, prices being the final selling point. A consumer would very much enjoy buying cheap bread but if the bread is too expensive, they may decide not to buy the bread. This is the type of pressure that capitalist worry about in the market place. If prices are too high, consumers will not buy. If prices are too low, he will lose money on bread and not import goods to himself from his own export. Various prices of complementary goods come together to form input costs. You export to import. This is true in production and true in international trade. When the state (government) arbitrarily changes the price of something, they are altering the value of a good. If the state reduces prices by law too low, then the producer has no incentive to bring the good to market. If prices are too high, then the consumer will have doubts about buying that good.
    How does relate to labor and wages? In regards to employment, Labor is a good just like any other good. The employer is paying you based on the productivity (how much profit your labor makes for the employer) of your labor and the supply thereof. If the government raises wages by law, employers will hire less new people, cut working hours, fewer job benefits, and demand higher productivity with better workers, or perhaps even use automation to replace them and probably even raise prices on consumers. Employers ultimately in a competitive market pay based on productivity and how much they can secure your labor (supply and demand). They are not paying for your life but the good you offer; your labor. Making labor arbitrarily higher restricts employment; prices out labor; labor cannot be brought to market as easily.
    What are the implications of this? Well, in socialism, people have less incentive to work hard as they are not getting any higher real wages (how much a wage can buy) for being more productive or having exceptional skill. If your productivity is "subsidizing" other less productive firms, or individuals, then the actual incentive is to work less and work lazier. Quality goes down, productivity goes down, let the other guy subsidize you, instead of you subsidizing someone else. Then there is the issue of even coming up with functional prices that reflect the distribution of goods among other things. Within the Warsaw Pact states, it was very difficult for them to agree on the price of the exchange of goods. No regards to quality, costs, demand, or real-world. Basically primitive barter agreement.
    The implications are quite clear, governments can determine prices but do not determine value to individuals. Markets determine functional, workable prices, even the price of money itself. People in markets constantly are weighing the benefits and wants of various goods all the time, such things are constantly fluctuating, as is the price.

  • John Henry
    John Henry Year ago

    This is the pre-scientific view of the economy, around the mid-19th century. The money supply itself doesnot connected with the quantity of goods and, accordingly, with the standards of living (if we estimate the standards of living as the consumed goods). The capitalists are not evil by themselves (all people are evil by themselves), they are simply selfish because they redistribute wealth in own favor. But selfishness leads the capitalists to their stupidity. Well, for this reason during the revolutions rich are always robbed and killed. Robin Hood was really a good man because he redistributed goods in the favor of the poor (which is obviously good). In the whole country all people may not work but live well, small oil countries (at their best times) are an example. This happens because they redistribute the global capital to their own favor, by selling their resources. For example, a bunch of stupid British capitalists (11 persons?) has to work a whole working day in order to produce the goods they will exchanges in some sort of Kuwait for oil. A Kuwaiti citizen does not need to do anything at all.
    Это глубоко донаучный взгляд на экономику, примерно 19-го века - где-то на уровне Смита или Маркса. Денежная масса сама по себе не производит блага и сколько денег ты не эмитируй, больше или меньше товаров в стране не станет. На самом-же деле все сводится лишь к перераспределению мировых благ, а оно может быть достигнуто не только путем производства актуальных товаров (хотя это и правда один из лучших методов). Можно просто продавать ресурсы, живущие за счет нефти мелкие страны тому пример. Даже Россия всегда оттягивала на себя значительную часть европейского капитала просто путем продажи своих ресурсов. Да или тупо пришел и разграбил - это тоже перераспределение благ. Поэтому Робин Гуд, перераспределявший блага в пользу бедных был и останется героем, а шериф Ноттингема (пытавшийся сохранить более несправедливое перераспределение благ в пользу богатых) - злодей. В конце концов, пришел, поработил, заставив работать на себя просто так - тоже перераспределение. Капиталист, поглощенный накоплением капитала, ничего не видит вокруг. Например, британские капиталисты сейчас вынуждены трудиться, чтобы купить нефть у чурок, хотя раньше, в эпоху колониализма, заставляли чурок бесплатно ее качать. Капиталисты близоруки и ленинская фраза "капиталисты сами продадут нам веревку, на которой мы их повесим" всегда актуальна.

  • Frodo TheHobo
    Frodo TheHobo Year ago +3

    Lol, you accidentally advocate for socialism in your video and don't even realize it.
    "To each according to his contribution" is a principle of distribution considered to be one of the defining features of socialism. It refers to an arrangement whereby individual compensation is reflective of one's contribution to the social product (total output of the economy) in terms of effort, labor and productivity.[1] This is held in contrast to the method of distribution and compensation in capitalism, where those who own private property receive unearned income in the form of interest, rent, or profit by virtue of ownership irrespective of their contribution to the social product.

  • TJ YYC Gaming
    TJ YYC Gaming Year ago +1

    First, I would like to say I love your videos. I watched all of the Operation Crusader video. But, I have some criticism where I believe your ideological bias has crept in...
    24:23 "Assuming we pay the politicians the same we pay everyone else, which isn't going to happen." Politicians are paid far less than the CEO of most large corporations. If we want management to be at least as competent as the management of large corporations we should pay comparable wages. And since you have already established that talent corresponds with salary (although perhaps not linearly), this seems like a reasonable thing to do. Begrudging politicians a fair salary relative to their private sector counterparts is no better than criticizing the "evil capitalist" for making money.

  • Erich Kirk
    Erich Kirk Year ago

    This is so simplified, it makes no fucking sense.

  • Adam Kasztankiewicz

    All those butthurt youtube economy experts in the comments XD
    Just show some respect guys and listen first to the video

    • Michael Red Sox
      Michael Red Sox 11 months ago

      I didn’t read one disrespectful comment. Most of them just disagreed with him and they explain why they do so.

  • Just Someone
    Just Someone Year ago +2

    I agree with what you're saying, but think you demonstrated it badly.
    At the start I completely misunderstood your direction, and later the scenario you were describing.
    It probably also doesn't help that the commenters here get all salty for working bad jobs that supposedly capitalistic, but in truth aren't.

  • lak jia
    lak jia Year ago +2

    There's a major problem should be taken into consideration: Money goes around.
    The profit is made for the company, not the "Evil capitalist"
    In real world what happened is the profit made by the company, didn't go back to production in fact were harvested by financiers and "Professional executives" and dividends bonuses and another 100 ways.
    This is one of the main reason why many people get frustrated or even refused to work harder because the wealth deserved to be given to either themselves or reinvest in the company are "GONE" in their eyes.
    Problem is, some of the executives (or sometimes most) are too selfish and just want to make money on their own, companies are drained in long runs.
    Also once the money is made, if not distributed they go to the fastest ways to generate more money - like bankers or investment.
    The "Evil capitalist" don't keep the money inside the operations instead they may invested projects which are totally unrelated to the hard working people.
    The people who works daily in production see their efforts are gone elsewhere again demotivated.
    If "Evil capitalist" could efficiently manage the company for a lifetime and reinvest their earnings to the same company to make them more productive - nobody complains.
    But when you look at the world today, it's different. Everyone are trying to make a fortune first then go to investment or areas you make quick money not production.
    To ensure the group of people working for you are motivated is a social science and as an employer myself this is not that simple. Money talks but it's much more than just that.
    I agree your comments with the basically rising minimum wage is totally pointless also considering there are 3/4 of the world's population get paid less than the developed countries Many people are willing to do anything, work twice or triple hours even sometimes not paid at all to get job opportunities, just to improves their lives. And there's no way anyone could regulate the whole world.
    People don't understand the reality of many other people's life, a beautiful picture can't solve problems.
    There'a no PERFECT solutions permanently solves all issues - I believe that's the biggest mistake of Hitler and Stalin.
    People are greedy and no rules will last 1000 years without consistent rework and rebuild.
    P.S.: Socialism and nationalism are claims of people which they feel they're not fairly treated - we can't also just say they are wrong. What's wrong is the society generates such extremism, they are just a reflection of the flaws.

  • Gabriel G.
    Gabriel G. Year ago

    Just stick to military, economics and political theory aren't your strengths

  • Ornate Orator
    Ornate Orator Year ago +2

    Oof salty commies all around 😂

  • TheExard3k
    TheExard3k Year ago +3

    I got a degree in economics and I enjoy Smith, Friedman and Co. as much as you certainly do. I use similar explanations to explain our economy in my environment. I like the bakery analogy :)

  • Neil
    Neil Year ago

    TIK - Please only discuss military history. Your discussions of military history are excellent with logical, coherent arguments supported by overwhelming evidence. Unfortunately, when you discuss anything else, your logic and the evidence seems to evaporate. This is a terrible lesson in economics. There are so many errors and misunderstandings, plus it is painful to watch because your explanations have not thought through. Realize that most innovations in the modern economy are a product of Government investment in the military, universities and healthcare. The internet is a case in point.

  • Eugene Savinov
    Eugene Savinov Year ago +1

    Didn’t know that TIK is so fond of unscientific libertarianism which doesn’t belong in the realm of orthodox economics. The list of sources used for this video shows how biased and one-sided the whole overview is, which makes me question TIK’s competence in his historical research.

  • Gawędziarz
    Gawędziarz Year ago +2

    Hmm... gotta love the american commies at work. "I have a master's in xyz". Grats, but it's kinda meaningless here.
    Also grats on missing the point.
    What I think TIK tries to show (and ye... putting words in somebody's mouth seems a bit... eh, but bear with me) is the GENERAL principle of how capitalism works, the logic base of that system. I guess the idea of a thought experiment in isolated system is a bit too much. Going back to basics like that is very important, in the world where everybody is focused on problems with capitalism. Sooo focused in fact that they long forgot these basics. Of course, microeconomics (or however it's called in your english speaking lands) is much more complex. Goods substitution, demand inflexibility of basic goods (if staple food price goes up, people won't stop eating and will cut other expenses instead, and increase other expenses if price goes down), inverse flexibility of demand of luxury goods ( demand goes up with price )... there's a ton of such stuff.
    Problems people see in capitalism in general is "the endgame" of capitalism - a point where cost/money paid to economy approaches 0 and aggregated profit approaches 100% of available capital in economy. Where there is no factory, there is no workers, just products purchased with increasing amount of debt leading to implosion of entire system. This endgame is however postponed by competition - as long you need to compete, you end up spending resources back into economy to gain advantage over your competition (there's also locally negative stuff like offshoring ect. but even in this case, resources go back into economy, just not your economy). Stuff like minimal wage, social transfers and support, taxation in principle should decrease profits for companies... in practice these don't do much other than actually killing competition. With more and more social & regulatory burden, it's progressively harder and harder to establish new independent business ventures. The worst fate we can have is to have "corporate communism" system, where massive monopolies simply give up a small percantage of thier income to the state which then distributes it to masses of people that produce nothing or perform boring rudimentary tasks right up until they are replaced by machines, only so that they are able to continue to buy thier products and take on increasing levels of subsidised debt - with no competition as incentive to return capital back into economy. And we are going there. It's gonna be stagnant, bleak world where almost everybody is equal, as in - equally screwed.

  • denny11lane
    denny11lane Year ago +1

    Yeah...OK. It's hard to believe in this day and age, that somebody this young can be SO Behind The Times. Not to mention spouting doctrine that are diametrically opposed to 90% of the people on Earth.....including HIMSELF.! Who is in this guys centerfold.....Henry Hazlitt and Ronald Reagan.?