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Author Topic: Would you rather - Currency multiplication  (Read 730 times)

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Offline AndyZTopic starter

Would you rather - Currency multiplication
« on: April 28, 2012, 01:46:37 PM »
People here on E have had some interesting perspectives, and it's shown me a lot about how people think on here, which I appreciate.  I've had a hypothetical question burning in my head for some time now and have been curious how people would respond.

The simple prospect is this: imagine that with a wave of a magic wand, you can either increase or decrease the amount of currency that EVERYONE possesses.  For the sake of this hypothetical, the influx does not cause inflation or deflation.  Those familiar with the concept of supply and demand are free to imagine an influx of supply such that the value of the currency does not change.

Would you rather...

Increase the currency

Homeless would be off the streets and become the lower class, lower class would raise to middle and so on, but the billionaires would become trillionaires.

Decrease the currency

In reverse, the billionaires would lose much of their money, but the lower class would all lose their homes and end up on the street, and everyone would suffer.

Stay the same

Not really sure why anyone would pick this, but I'll add it in case I'm wrong and people can give a decent reason.



This kind of question can't help but fall into politics, so I figure it best to just place it here at the start.

Offline Hemingway

Re: Would you rather - Currency multiplication
« Reply #1 on: April 28, 2012, 02:06:51 PM »
Without making too big a deal out of the way the question is put, I really feel I ought to mention that the question of "class" isn't really a measure of how much money you have. The only way giving everyone more or less money would have the effects suggested is if there was no supply and demand to consider, no inflation, nothing like that.

That said, I voted "stay the same", because from where I'm standing, the other options wouldn't actually accomplish anything in the way of evening out inequalities or fixing the world's social problems. In an economic system like the one we're living in, it seems to me ( and this is, in a way, the main contention of the dependency school of development theory ) that you can't improve living conditions, standards of living and so on, in one place, without having a negative impact in another.

Simply giving more money to everyone would either lead to no change, or, if the spread is uneven, it would lead to greater equality in some places and less in others. On the other hand, simply taking money away from everyone would just end up putting more people in poverty ( absolute poverty, that is ), and simply give the still-wealthy more people to exploit. Somewhat paradoxically, taking money from everyone would probably have the result of making the wealthy a great deal wealthier.

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Re: Would you rather - Currency multiplication
« Reply #2 on: April 28, 2012, 02:10:20 PM »
Simply giving more money to everyone would either lead to no change, or, if the spread is uneven, it would lead to greater equality in some places and less in others. On the other hand, simply taking money away from everyone would just end up putting more people in poverty ( absolute poverty, that is ), and simply give the still-wealthy more people to exploit. Somewhat paradoxically, taking money from everyone would probably have the result of making the wealthy a great deal wealthier.

Not exactly paradoxically - taking money from everyone drops the billionaires to millionaires, who can still afford to go out and buy up the foreclosed property that the lower-class are being kicked out of.  Real-estate moguls ensue.

Offline Hemingway

Re: Would you rather - Currency multiplication
« Reply #3 on: April 28, 2012, 02:14:15 PM »
Not exactly paradoxically - taking money from everyone drops the billionaires to millionaires, who can still afford to go out and buy up the foreclosed property that the lower-class are being kicked out of.  Real-estate moguls ensue.

I simply mean because, when taking money from them, you'd probably expect them to get poorer, when, in relative terms, they'd actually get wealthier.

Offline Shjade

Re: Would you rather - Currency multiplication
« Reply #4 on: April 28, 2012, 03:22:41 PM »
Since magic is involved to prevent inflation, give everyone money. Benefits the extreme poor much more than the extreme rich and resolves a lot of persistent issues thereby.

Of course, since there is no magic to prevent inflation, this wouldn't really accomplish anything, but hey, we're being fantastical here. I don't see a downside.

Offline OldSchoolGamer

Re: Would you rather - Currency multiplication
« Reply #5 on: April 28, 2012, 10:16:37 PM »
Since we can magically increase the supply of stuff, I'd certainly opt for more stuff/prosperity for everyone.  I'm not a fan of the wealthy elite, but that's mainly because they've gamed the system to get where they are (for the most part) rather than creating goods and services of value to others.

I'm assuming the question behind the question here is, "Do you hate the rich enough to see tens of millions of people take a dive just to get back at them?"  And the answer is no...especially if in this magic world we can swing things the other way and alleviate poverty for all.  My core problem with the current American system isn't that some people are rich--it's that they've gotten rich at the expense of 80 to 90% or so of the population.  If the rising economic tide from the 1970s through 2006 or so had lifted all boats more or less equitably, Bill Gates and Donald Trump having billions wouldn't bother me.

Offline OldSchoolGamer

Re: Would you rather - Currency multiplication
« Reply #6 on: April 29, 2012, 10:54:23 AM »
To expand on what I wrote before, this is the crux of popular anger today and something that U.S. Republicans either just don't get, refuse to get, or get but are now obfuscating from the American public.  From the end of World War II to the 1970s, America saw everyone get more wealth...kind of like in the hypothetical scenario here, if less amplified.  The poor got richer.  The middle class got richer.  The rich got richer.  Even historically disadvantage minority groups did better.  The rising tide lifted all boats.

Had that trend continued, I doubt very seriously we'd be seeing the whole "Occupy" movement and the other social equality movements that infuriate Republicans so much.  The average American worker would be making about 25% or so more.  So a burger-flipper making $8 an hour would be making $10.50.  A call center employee making $10 an hour would be making $12.50.  A semi-skilled worker making $13 would be making more like $16.50. 

Unfortunately, that didn't happen.  Starting circa 1975, the gains in wealth went more and more to the rich, and less and less to everyone else.  By the Reagan years the trend was firmly established.  And for the past decade and a half, income for the working class has flatlined or even declined.

Offline Callie Del Noire

Re: Would you rather - Currency multiplication
« Reply #7 on: April 29, 2012, 06:07:38 PM »
I don't see how currency multiplication will work. You would simply get a larger number tacked onto the gas price/milk/pizza/whatever you buy.

OldSchoolGamer has a point on it. Somewhere down the line the wage earners got left behind and more and more profit was turned to fewer and fewer people.

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Re: Would you rather - Currency multiplication
« Reply #8 on: April 29, 2012, 06:23:15 PM »
I don't see how currency multiplication will work. You would simply get a larger number tacked onto the gas price/milk/pizza/whatever you buy.

OldSchoolGamer has a point on it. Somewhere down the line the wage earners got left behind and more and more profit was turned to fewer and fewer people.

Under the original conditions of the thought-problem, it was given that the change would not cause inflation/deflation of any kind.  Admittedly, that puts this purely in the range of 'thought-problem'.

I'm in agreement with OSG with regards to the super-rich:  the rich got richer at the expense of the rest of us, instead of churning that money back into the economy.

Offline Callie Del Noire

Re: Would you rather - Currency multiplication
« Reply #9 on: April 29, 2012, 06:24:50 PM »
Under the original conditions of the thought-problem, it was given that the change would not cause inflation/deflation of any kind.  Admittedly, that puts this purely in the range of 'thought-problem'.

I'm in agreement with OSG with regards to the super-rich:  the rich got richer at the expense of the rest of us, instead of churning that money back into the economy.

Even today, despite the claims of my two favorite 'conservatives', they aren't putting it back. They are putting it in their banks. Without a way to encourage reinvestment in the country, you'll never get the ultra-rich to reinvest.


Offline OldSchoolGamer

Re: Would you rather - Currency multiplication
« Reply #10 on: May 01, 2012, 03:21:49 PM »
Even today, despite the claims of my two favorite 'conservatives', they aren't putting it back. They are putting it in their banks. Without a way to encourage reinvestment in the country, you'll never get the ultra-rich to reinvest.

I think that in the end we're going to have to have some inflation to put an end to this...make it no longer economical to hold onto big wads of cash.  This is far from a perfect solution, but it may be the best we can come up with.