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To: null and void
<"Fundamentally the only sources of wealth are to • Extract it - fishing, forestry, mining and drilling • Grow it - farming • Manufacture it - from resources extracted or grown • Transport it - from where it is to where it is needed Taking in each others laundry (also known as a service economy) doesn’t create wealth, it just spreads it thinner and thinner until it is all gone."/>

EXACTLY what I was taught many years ago. Another might be knowledge based ideas that can be used and/or sold. Also I was taught that to improve a local ecomomy, such items be sold outside of one's locality to increase local wealth.

21 posted on 09/02/2012 9:15:13 PM PDT by glowworm ( Liberal thot is truly a mental condition... Seek help!)
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To: glowworm

Also, you can’t create wealth by counting it (accountants) or suing it (lawyers). We’ve got FAR too many of those guys in the USA now!


24 posted on 09/02/2012 9:54:59 PM PDT by Frank_2001
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To: glowworm
Taking in each others laundry (also known as a service economy) doesn’t create wealth, it just spreads it thinner and thinner until it is all gone."

If people voluntarily pay to have their laundry done, then by definition, it creates wealth, even if it's not something physically tangible. Conversely, if no one buys an ugly, inefficient, Chevy Volt, even if every solid part was patriotically manufactured in the good old USA, then, by definition, zero wealth was created even though the entire product is physically tangible. In fact, there was a net loss of wealth, because Chevy misdirected resources — land, labor, capital — into manufacturing something that no one found valuable. The land, labor, and capital could have been used to create something else that people find valuable . . . for example, they could have been used to build and staff a laundromat that provided the valuable service of taking in people's laundry.

If people voluntary pay money to have their laundry taken in, washed, folded, and handed back to them in a timely manner, and if they do NOT voluntarily want to pay money to Chevy to buy a physically manufactured object such as a Volt, then the service of taking in the laundry has added value — wealth — to the economy, and the manufacture of a physical good like the Volt has added nothing; in fact, it has subtracted wealth from the economy.

Additionally, what you're not seeing is the fact that laundry has to get done, willy-nilly. If my laundry is not done by the low-wage immigrants operating the laundromat down the block, then it has to be done by high-wage-ME, at home. Since my time is worth a lot more than the low-wage immigrant's time, having to do my own laundry results in a loss to the economy — in the same two hours that I might normally waste doing my own laundry, I could have been at the office doing two more hours of productive high-value-added work. That someone else takes in my laundry and does it for me, however, frees up my time and labor so that I can be more productive and add a bit more value to the economy.

Thus, the service of taking in laundry also indirectly creates wealth by freeing up other people's time and labor.

27 posted on 09/02/2012 11:57:05 PM PDT by GoodDay
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