Slightly socialist Economy thoughts.

At the moment, it’s very difficult to get a job. The job market is awful, and has been for some time – but production stays the same. Hell, production for a lot of things has been steadily rising as jobs fall.
Why? Machines. Machines are the most cost efficient way to produce things. They can work faster, they can work more consistently, they don’t need paying. All they need is occasional maintenance, and maybe one or two people to watch and fix any small errors, or press the occasional button, or whatever needs doing.
Even services are being taken over – think self-service checkouts. There can be 8 machines with only one employee watching over them all. Think online shopping. How long until that overtakes the need for front of house retail staff?
How long until coffee baristas are replaced? Bartenders?

Unemployment is low, MEANINGFUL unemployment – work that couldn’t be done by a machine – is lower. But production isn’t suffering from this.

So there are fewer jobs available, yet more goods are being made, and for less. So why are prices rising everywhere? 50 years ago, let’s say that 100 people made 10 cars a day. Now, 2 people and 10 machines make 20 cars a day. Those two people and those 10 machines make more cars a day, and cost less, AND the cars are now more expensive.
So, brief recap: 90 jobs down, and Ford or whoever is saving money on employment whilst making INCREASED money on both yield and unit price.
Every single component going into each car goes through the same process – made by machines for a fraction of the cost than had it been made by people.

So, say in a parallel universe all of those manufacturers – of both components and full products – don’t have machines and are instead paying people to do all the man power.
The price to the consumer in this world is, however, exactly the same as it is in our universe today. All of a sudden, the idea of mechanised industry is introduced to this parallel universe. OVERNIGHT all companies sack their human staff and replace them with machines – but in THIS universe, instead of adding the saving to their profit, they shave it off the price.
So the profit margin is the same as it always has been, with the workers being paid the same amount, but the consumer is suddenly paying much less.

Now imagine this universe had taken that route – or had that route forced upon it today. Only not cars, but ALL manufacturing, at EVERY level. All of a sudden companies are still making a profit, and capitalism is still capitalism, but the difference is less obscene. Instead of being able to buy everybody out of house and home three times over, the super rich can now only do it once or twice.

Now we could make that gap even smaller: Everything is now cheap, being produced in great numbers for tiny cost, and at tiny cost. Holding down a 5 day a week job is suddenly enough to create an excess of money, but the unemployed are still in huge numbers, and still struggling.
Cut everyone’s hours in half – there are now two jobs for every one, unemployment is given a smacking, and people have sensible amounts of income again.
So, to recap, in this perfect, idealised world: People are paid less, but have more free time, and because everything is cheaper, have equal or even greater spending power. Because the price of components has gone down in-line with the price of goods, business owners are still turning a profit on their work, but a reduced one.

This does cause effects, however. Everybody is earning less money, so Pay As You Earn tax decreases. The percentage on it can’t be increased to make up for this, because that would mess with the equilibrium that would exist between goods and the consumer. For the same reason, ‘hidden’ tax such as duties and V.A.T couldn’t be increased either.
So the various governments would have less to play with. Now, assuming everything has gone well, unemployment benefit shouldn’t be as great an issue, but there are still things like education and healthcare to consider.

I have to straight up admit that I have NO IDEA how much healthcare actually costs. The true price is hidden, quite deliberately, by medical institutions and pharmaceutical companies. Assuming that pharmaceutical companies are governed by the same hypothetical profit margin law that affects other goods, healthcare shouldn’t be an issue.
It’s estimated that even in America today almost everyone could pay for healthcare by themselves if the prices were fair, instead of being jacked up in expectation of insurance payouts. Healthcare is, after all, nearly the definition of a captive market.

Education is another difficult one. Here is a resource claiming that the average cost, to a university, to teach a student for a year is £7,300. It doesn’t give a breakdown, so it’s impossible to know how much of that goes on teaching, facilities, or building maintenance.
It’s almost impossible to find how much it costs a state school to teach a student – one would assume it’s an awful lot more, seeing as state schools present students with textbooks and stationary.

Again, there are obvious drops that would happen here – the money state schools spend on books and stationary would drop as the cost of those things fall, and teacher salaries could fall to remain in line with, as it were, ‘inflation’ – and maybe this would cause the state subsidies to fall to a level that would remain sustainable.

This is, basically, a thought experiment to see what could happen to the economy in a sort of modern-day quasi-marxist society – a society that ISN’T ruled by capitalist greed. I’ve tried to explain my thinking from the beginning to make it understandable, and I’ve almost certainly failed completely.
I’ve ALSO failed to mention the inherent flaws in the system I came up with – simply because I’ve been thinking it through for WELL over an hour and my brain is melting.
I’m sure I’d early thought of some – and even some changes that could address them – but they’ve completely fallen out of my head. I think I’d also thought of some game-breaking ones.

Basically, if anybody finds this interesting at all please think about it. Then break it, and then let me know HOW you broke it.

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