I like physics. It defines things simply and cuts through bullshit. For instance, it defines work (W) as F*s, where F is force and s is distance, meaning that work is using force to move shit around.

An example of work is me moving my desk a meter to the left. That is n units of work. If I then move it back to the starting position, that’s 2n units of work in total.

All kinds of people will tell you, until your ears bleed, how work is great, and it’s the only honest way of earning money.

The problem is, nobody pays anybody to work. People pay you to solve their problems.

The problems can be varied. If they are hungry, they will pay for food so that the problem of hunger goes away. If they are sick, they will pay for medical care so that the problem of sickness goes away. If they need to go places, they will pay for transportation. If they don’t want to go around naked, they will pay for clothes. If they want to pose in front of other people they will pay for the status symbols. If they have a company and there’s too much work for one person, they will hire someone to solve that problem. Always, there’s some problem someone has, and if there’s a proposed solution, and it’s acceptable, money will change hands. Sure, those solutions will require work, however work is not what you’re paid for. You’re paid to make the problem go away.

There’s a saying here in Croatia, that if work made one rich, a mule would be wealthy. A forklift or an excavator does lots of work, however this work is not highly valued, because people value solutions of their problems, and then the marketplace competes in offering those solutions, and if marketplace offers ten physical workers with shovels, or a backhoe with an operator, the people who need an underground pipe installed don’t care how it’s done, they just want it done cheaply, well and fast. They want the problem to go away. If the workers do the digging, they will think their work is what’s worth the money, but they are wrong. If they dug the same ditch somewhere else, not only would they not get the money, they might even get fined for digging holes where they’re not supposed to. So, the same work can be worthless, harmful or useful, depending on whether it solves or causes problems.

I watched some “malicious compliance” videos on YouTube, where employees take petty vengeance on their boss by complying with the exact wording and not the spirit of the request. Essentially, they do the work, but they don’t actively try to solve problems, and their work then invariably causes damage, which they can avoid being punished for because they literally complied with the request.

That’s something the “working class” doesn’t understand. They see how they work all day, and are paid x, and some rich person doesn’t appear to work nearly as much, and earns 10000 x. They see it as injustice. Sure, sometimes it is. Injustice exists. However, I watched a YouTube video of Peter Schiff going out to the “occupy Wall st.” street protest to answer any questions the protesters might have for the “1%” they seem to blame for everything. It becomes immediately obvious why he is a millionaire and they are all broke, and it also becomes obvious why that is perfectly fair. You see, people don’t “deserve” to have money because they exist, nor do they “deserve” to be paid because they work hard. The way people actually make money is by understanding what someone’s problem is, and offering to solve it for a fee. Yes, this might require working to mow someone’s lawn, but you’re not getting paid for work. Try finding a meadow in the middle of nowhere and mow it until you pass out, and see if anyone will pay you money for it. Work itself is not worth shit. Work that solves someone’s problem, however, has market value, but it’s not work that’s valuable. You can replace workers with robots, make work itself almost worthless, and the one solving the problem this way will actually make even more money.

The point where we come to injustice is Van Gogh, who died in poverty and desperation because nobody valued his work during his life, and his paintings are now among the highest valued works of art of all time.

Trickle-down economics are something you hear about these days only when it’s argued against by socialist-minded people, and even some billionaires seem to get it wrong. So let me explain the concept first, and then I’ll proceed to the related matters.

The concept itself is simple – it’s about whether the rich should be taxed more since they have more. The communist answer is “yes, because they must have stolen it somehow from the poor and everybody should be equal”. The capitalist answer is “no, because wealth is not pre-existent, it is created by people with ideas that worked, and in order to motivate others to explore their ideas, you must create an environment that rewards creativity and success, and punishes mediocrity and risk-aversion”. The trickle-down theory says that if you don’t tax the wealthy disproportionately, they will create jobs and therefore wealth for others. If you tax them, the state will squander the money like it usually does and it will do nobody any good.

The point of contention is that if you don’t tax the wealthy, they will not consume enough products on the market to create demand sufficient to justify the trickle-down theory. A wealthy person will own the best car, they will tell you, but it’s only one car. Also, I heard an even dumber argument, stating that wealthy people will just keep their money somewhere, being wealthy, and that money isn’t doing anything for the economy. It’s obvious why socialists are poor. They don’t know anything about money.

One of the explanations why Germany became so incredibly wealthy is because its people saved money. If they save money, the banks can use deposits to guarantee for loans. This grew the German industry and economy. The opposite theories, that people should spend more in order to stimulate the economy, invariably end badly, in collapse of the credit bubble, and eventually collapse of the monetary system. Paradoxically, when wealthy people save money, the economy thrives, because credit is backed by the deposits, and the alternative is for the state to debt-finance loans, which eventually collapses the state and its economy. In a healthy economy, everybody earns a lot and spends less. Essentially, instead of supporting the credit-financed consumption of the citizenry by foreign debt, the banks support the growth of the economy by internal deposit-financed debt.

Also, let’s see what the wealthy people actually do with their money. First there’s consumption. They put a portion of their wealth into their lavish lifestyle. This stimulates manufacturing and retail. Then there’s the money that is re-invested in their business, because if someone got wealthy by growing a shoe manufacturing business, he will re-invest some of the profits into the business, which means more jobs and bigger industrial output. Then there’s investment in stocks and bonds. If you buy bonds, you help the issuer get capital for his business without relinquishing share in the business. If you buy stock, you help businesses get financing by relinquishing share for capital. Basically, whether you invest in stocks or bonds, you invest into the economy, of course hoping to make a profit in the process, and by doing that, you are performing essentially the same function as the banks: you help economy get liquid capital in order to grow, and you are repaid with a share of the profit. The money you keep in the bank helps the economy through ways I described before, and there’s also the possibility that you keep a portion of your wealth in precious metals, which condenses your wealth to a form that is no longer useful to the economy, but instead performs another function: if the state manages to squander everything, all other forms of wealth will evaporate, but precious metals can be used to restart it from the ruins and get everything going again, and that is probably the most vital function in the entire system. Basically, every unit of money a wealthy person gets to keep functions either as a catalyst, lubricant or power storage for the economy as a whole. So, as you can see, all the criticisms of the trickle-down economics are based on total misunderstanding of money and the economy, which is no wonder, since people are learning economy from the communists. It took me decades to learn these things, and everything I learned in school or from my parents was so incredibly and utterly wrong, it’s a miracle I’m still here, and no miracle I had to go through several disasters to get here. I think even most bankers and heads of central banks have those things completely wrong, which is why today’s monetary system and the economy are in such a precarious state, facing either complete restructuring or a violent disaster.