Indian kid describes America

[Sava]

Turning metal into a car doesn't add value to the metal. It artificially inflates its value temporarily. If anything, it ultimately lowers the value. In 20 years, you aren't able to recover as much money as you put in.

[rah]

Yes, I agree Imran.

I don't think anyone is denying that Norway is benefiting from a temporary windfall. I think most people are making the point that the US has also benefited from it's generous bounty of resources. And we're mystified how anyone could say that this generous bounty hasn't had an important impact on our economy.

[giblets]

No, it's not.

For instance, it's very easy to see how we benefited from being a major oil producing country during WWII. Or how being separate from Europe benefited us at the same time.

You can still benefit from infrastructure built decades ago, you can buy products from companies which arose in gold rushes, oil booms ... and all the wealth generated by that economic activity has had time to be reinvested, provide new profit, and be reinvested again ... again and again.

Pretending wealth just disappears on a clock is stupid.

Are you aware of the fact that investments are destroyed over time by wear and tear and obsolescence? Wealth is, in fact, destroyed by time. Yes, I can use roads built decades ago, if they've been maintained to offset the damage they've sustained. Since a capital stock has to be constantly maintained at great cost it really doesn't matter if the US had more capital per head 100 years ago. Especially considering that the population has more than tripled since then. All other things being equal a country with less wealth will converge with a richer country fairly quickly- in the long run what matters is the efficiency with which capital is used. If Japan is roughly as efficient as the United states, then the fact that Japan was bombed into the stone age during WWII while the US was untouched is irrelevant now- there's been more than enough time to repair the damage and Japan's economy has reached equilibrium.

[Felch]

Turning metal into a car doesn't add value to the metal. It artificially inflates its value temporarily. If anything, it ultimately lowers the value. In 20 years, you aren't able to recover as much money as you put in.

What kind of car do you drive, and would you be willing to trade it for its weight in iron?

[rah]

What kind of car do you drive, and would you be willing to trade it for its weight in iron?

I'm guessing an Adobe

[Sava]

What kind of car do you drive, and would you be willing to trade it for its weight in iron?

I don't currently own a vehicle. I have a company car at my disposal.

I've only owned one car in my life (on my own). I put a lot of care into it. I kept it clean. Ultimately, it broke down. I got a decent amount for it as a trade in (got a car with my dad, I was only driving him around at that point). That car eventually got traded in. So the ultimate amount of "value" from the amount of money I originally put it... is maybe around $500-1000... from about $20k.

So yeah. Cars suck. They are black holes that suck up all your cash.

I'd much rather have the original $20k I put into it... but preferably not in iron. That's just not very practical.

And as public policy, car-friendly policies (as opposed to say, an efficient public transit system) are horrendous for a country's economy. You have an entire consumer base spending a large part of its income on something that ultimately is worth nothing.

[The Mad Monk]

Are you aware of the fact that investments are destroyed over time by wear and tear and obsolescence?

I think Aeson is in fact uniquely situated to be enormously aware of that.

[Felch]

By Sava's logic, it's stupid to buy food because it all turns to shit. The value of a car is not in its resale value, but in the ability to move people and things tens of thousands of miles without much physical effort.

[giblets]

Given that lots of people would rather pay $20k for a car than use mass transit or ride a bicycle... I'd say making cars generates a lot of value.

However the fact that Americans have more cars in 2013 won't magically make America's GDP higher in 2113.

[regexcellent]

People prefer cars because mass transit sucks and driving a car is hugely preferable to waiting for a ****ing bus.

[Ben Kenobi]

spending a large part of its income on something that ultimately is worth nothing.

One, I already know you're full of ****. 'Company car'. Uh huh. If cars really had no value - you'd not be driving one.

Two, just who are you trying to convince? Liberals are already convinced that the concept of 'cars for other people' is satanic while conservatives love their cars and believe others should drive.

[MRT144]

People prefer cars because mass transit sucks and driving a car is hugely preferable to waiting for a ****ing bus.

Depending on where you live...

[Ben Kenobi]

Since arable land is one of the most important natural resources.

Then your argument is defeated as the Soviet Union had more yet is not nearly as wealthy as the United States.

It's one where the US actually leads in quality over everyone, and in area over everyone except the Soviet Union.

Uh, I suspect you mean 'quantity'?

That's one of Canada's problems, not as many people.

That's one constraint, yes. But Canada is also poorly managed in resource extraction. They don't distribute their extractors well - they have an enormous hinterland that is poorly understood by the decision makers, they have poor understanding of total available resources, and a reluctance to actually make the effort to get at the resources available. Then they don't manage the resources that they do have well. Nor do they invest much capital in transportation. Despite having a larger country - invest fewer dollars per capita, and the dollars they do invest are poorly distributed.

Canada does have population issues - but the main constraint is the approach to development in general. The US, while certainly not perfect, manages their resources better and has an enormous advantage in terms of transportation. You want to know why the US is wealthier today? Thank Eisenhower for the interstates.

I am not saying that Americans are naturally superior I am saying that Canadians by and large are hindered by their understanding of development.

It can't just be people trying to get away from you, since you already left.

Remember I grew up in a mill town that runs off the pulp and paper industry and has been devastated by the mountain pine beetle epidemic. What exactly do you think I would think about Canadian management of natural resources? The epidemic would have been confined to one park where it was first detected, had they been able to mill the beetle kill then. Instead, the environmentalists blocked harvesting in the national park and Suzuki had a massive fit over it. The result - the destruction of most of BC's lumber industry.

Contrary to what you want to paint it as, as only nationality mattering.

You're abandoning your thesis that 'if America was governed by anyone other than Americans it would be wealthier?'

Close proximity is a double edged sword. Hitler and Napoleon made them pay a heavy price for it.

Part of the reason Napoleon was even able to invade is that Russia had not adequately developed her territory.

US on the other hand was only lightly affected by invasion before any real wealth had been accumulated. Very little long term damage done.

This is evidence that Aeson has never been south of Mason Dixon. This is not so.

Sea transport has always been rather effective form of trade as well. Especially before the advent of railroads.

True, but you still have to transport things from Europe to North America to build things in the first place, whereas Europe didn't have to do this.

You're going off the deep end now. I simply said that people in Alaska have a lot less infrastructure, which suggests (as does common sense) that building infrastructure in rugged frozen terrain is somewhat more difficult than in more amicable climates/topology.

Part of the reason why Alaska has less infrastructure is because it is divided from the lower 48. Alaska would have more infrastructure if Canada wasn't so backwards.

You're hilariously lost in this conversation.

Right. I bet you can't place Alcan on a map. Have at it.

I brought up Aluminum (not in regards to any specific country) because it is a resource that exists in large quantities in many areas ... long before it was useful as a resource.

And it's a poor example because Aluminum is actually well invested and exploited today.

Irrelevant.

That's a nice little wand. Please - go and prove that I hate canada by finding a post of mine where I state that American management is superior before 2005.

You're the one trying to prove that topology and climate (and resources) are not a factor.

I'm saying it is a factor. I am saying that Americans were able to overcome these issues to a greater extent than Canada and the Soviet Union.

Napoleon, Climate, Hitler, Communism, Vodka. I'm sure there are countless other factors, but those are the ones that spring to mind.

Nothing on serfdom?

I said that anyone who had America's land would have done better than they did with their own land.

And I'm the self hater? Physician heal thyself!

You disrespect the value of the land.

Where?

It sickens me that someone like you, who grew up on a farm and should know better, who professes to believe in God who created this world for us, take the same view about how unimportant land is

I believe the American system is superior. Ergo, it stands to reason that I believe that land preservation is important. What you really want to say, (and haven't), is that my rejection of environmentalist claptrap that you espouse makes me a poor steward. Also - earth is a God to you, whereas it is not for me - so guilty as charged. I don't worship the earth.

[Fake Boris]

Where the resources come from is therefore not particularly important

Huh... this is the whole point of geopolitics.

[giblets]

Norway actually utterly destroys HC's argument, although I suspect he hasn't noticed yet. The Norwegians are taking most of that oil money and investing it in a future where they will not have such easy access to oil, thus ensuring they can continue to maintain the kind of society they have now once the flood of oil isn't there any more.

I missed this but it reminds me of something important... international capital flows. Norway's sovereign wealth fund invest in companies all over Europe and the world. The wealth doesn't just sit in Norway. In the 19th century a lot of the funding for American railroads came from British investors. Americans, likewise, have made investments all over the world... the idea that the extra money Americans made (relative to Europe) in the 1800s from resource extraction is still sitting in America and giving America an advantage in terms of GDP is simply false.