Economics in Slow Motion (Part 3): Subsidized Poverty
First, let me state the obvious lest viewer doesn't think I know. The production quality sucks. I whish I had time to sit in the studio and make multiple takes to get rid of the "umm"s and the tied tongue. I will one day remake them if people start watching.
This is part 3 In a Series of "Economics In Slow Motion". In this part we focus on what happens when the government interferes with natural processes and tries to "Redistribute the wealth". Watching Part 1 is necessary. Part two would enhance the idea.
The focus of this video is to push further into the woods how the effects of enabling the poor effects the system. The question that drove this is "why are the middle class focus their angst on the poor?". While most people don't understand the complexity of the math, there is a natural understanding of a Working poor and a government enable poor shopping at the same store and the working poor seeing those that use the tax dollars the government collected to buy the same good off the shelves. "Why bother working if the government will just give it to me." What they don't understand is that the store can only acquire 80 gallons of milk per week. However there are 100 members of the community that need a gallon a week. If the government reaches in and buys 20 of those gallons for people who are in a situation of their own making, the other 80 working poor members are left to fight over the remaining 60 gallons. This will cause an inflated price.
The amount of dairy farm land isn't going to change. The number of cows that produce milk on that land is not going to change much. The number of gallons available to the store will only change if they are willing to pay more for it. And that will mean somebody else with less will have to go without. And then they will be frustrated. If our store here is the less fortunate, they will have to charge more for the milk so they can be able to just buy their normal 80 gallons next month. The people making the bad financial decisions are not the ones who are feeling their efforts are not being rewarded. The people in the upper classes are feeling the pinch. They notice things cost more, but it just means a little less "luxury". It is in the middle that the "hard working class" has to give up sending Johnny to college so some poor people who decided to bring a child into this world don't have to starve. It is a morally strenuous and financially untenable situation. The fact that they don't understand the science, means thy target sometimes irrational subjects and turn to illogical leaders who "speak common sense".
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