No Amount of INSULTS Would Repeal the Laws of Business and Economics

It's October 2024 and I had no topic to write about a few days ago. Today, I decided to write about how using personal attacks is a common tactic. The use of Ad Hominems or personal attacks is attacking the person instead of the argument. Such people don't care if they contradict themselves--as long as they can insult because they're losers. One of the things I noticed is how I discuss the laws of economics. However, I can get an answer like, "Muh supply and demand! Da conspiracy of supply and demand!" I purposely misspelled the words to show how the person's lack of knowledge and use of mockery. Such persons can repeatedly hurl insults like saying I'm stupid, room temperature IQ, fake IQ, traitor to my fellow Filipino, etc. The list can go on and it's both amusing and irritating to recall every bit of insult I've had. But as advised, I'm told to learn to ignore insults or laugh at them.

An anonymous quote, probably said by Socrates was, "When the debate is lost, insult becomes the tool of losers." It's observable because graceful losers are willing to learn from the lost debate. It's because in the MARITES pyramid of learning (above)--it's often that people use the Trust Me Bro logic and if you refuse to listen, expect every kind of insult to follow out of their dirty mouths. However, no amount of insults is ever going to change the fundamental laws of economics. The tactic was used against Senator Robin Padilla, who I didn't vote for (read here). Instead of focusing on where Padilla was wrong--they decided to attack him as a person. It's one thing that Atty. Jose Manuel "Chel" Diokno addressed the argument against Padilla. Yes, I agree with Atty. Diokno on marital rights. However, that doesn't void anything Padilla said as right. Again, let me remind those who identify as Dilawan that until the Philippines to a parliamentary system--they can't become the real opposition if the Liberal Party of the Philippines doesn't become the governing party!

Whether we want to admit it or not--supply and demand are still natural laws. No one, not even the government is above the laws of business and economics. What's the use of ridiculing the impossible promise of President Ferdinand R. Marcos Jr. on the PHP 20.00 per kilo rice if they believe in Sahod Itaas Presyo Ibaba economics (read more here)? Whether we want to admit it or not--economics are natural laws and can't be altered. Nobody, I mean nobody, is above it. No government can change the laws of supply and demand! 

History has proven that people who tried to defy supply and demand failed. If we're going to understand the law of supply and demand, here's some help from Investopedia:

The law of supply and demand combines two fundamental economic principles that describe how changes in the price of a resource, commodity, or product affect its supply and demand. Supply rises while demand declines as the price increases. Supply constricts while demand grows as the price drops.

Levels of supply and demand for varying prices can be plotted on a graph as curves. The intersection of these curves marks the equilibrium or market-clearing price at which demand equals supply and represents the process of price discovery in the marketplace.

KEY TAKEAWAYS

• The law of demand holds that the demand level for a product or a resource will decline as its price rises and rise as the price drops.
• The law of supply says that higher prices boost the supply of an economic good and lower ones tend to diminish it.
• A market-clearing price balances supply and demand and can be graphically represented as the intersection of the supply and demand curves.
• The degree to which changes in price translate into changes in demand and supply is known as the product's price elasticity.
• Demand for basic necessities is relatively inelastic. It's less responsive to changes in their price.

If we want to summarize the basic laws, it's that:

1. When supply is high and demand is low, the prices will go down.
2. When supply is low and demand is high, the prices will go up.  

History proves you can't fight off business and economic laws

If we take a look at the fundamentals, everything is dictated by supply and demand. It's because cost of production can be affected. If the raw materials supply is hard to find--it would mean spending more time looking for the raw material just to get it produced. When people buy a product or eat at a restaurant--they buy more than the product. They're giving the money needed for basic expenses such as utilities and maintenance. 

People should research on events like the Great Depression (read here). One of the factors that made it happen wasn't capitalism but economic protectionism. This information from Marketplace highlights why you just can't defy the laws of economics without disastrous results:

When bad economics happens to good intentions

So Smoot, along with his House cohort Hawley, began crafting a tariff bill in Washington, which made for very good politics and very bad economics. American farmers in 1929 were struggling, but the problem was not foreign competition; it was depressed agriculture prices. Tariffs would not solve this, yet farmers still wanted relief. And politicians still wanted to help — or appear to be helping.  

“They had a lot of debt as a result of World War I,” author Irwin said. “Crop prices were lower after the war, and they tried initially to help farmers through price supports. But that was considered a new idea. So they came to the tariff as sort of an indirect way of helping out farmers by stopping imports of farm goods.”

The Republican party at the time controlled both chambers of Congress and the White House, and was concerned about winning the Midwestern farm vote in the next election.

“I think it was more of a signaling thing,” Irwin said. “They didn’t think it was going to be a big deal when they proposed it.”

But it turned into a big deal, a protectionist feeding frenzy, in fact. Congress started holding hearings on tariffs in 1929, at which point all kinds of lobbyist and industry groups showed up to piggyback on the farm tariffs. Ball bearings, steel, textiles, shoes, bricks, collapsible tubs, bottle caps, sprinkler tops, you name it. Even the goldfish industry joined the protectionist exuberance.

However, people never learned from it. In fact, one of the greatest disasters ever was Mao Zedong's plan for a Great Leap Forward. It was the plan for a self-industrialized China. However,  Mao's project was a disaster. Mao has no one but himself and his cohorts to blame for it. In fact, this is how Investopedia describes Mao's disaster, something that wokes will dismiss as "mere capitalist propaganda":

Agriculture

Private plot farming was abolished and rural farmers were forced to work on collective farms where all production, resource allocation, and food distribution was centrally controlled by the Communist Party. Large-scale irrigation projects, with little input from trained engineers, were initiated, and experimental, unproven new agricultural techniques were quickly introduced around the country. 

These innovations resulted in declining crop yields from failed experiments and improperly constructed water projects. A nationwide campaign to exterminate sparrows, which Mao believed (incorrectly) were a major pest on grain crops, resulted in massive locust swarms in the absence of natural predation by the sparrows. Grain production fell sharply, and hundreds of thousands died from forced labor and exposure to the elements on irrigation construction projects and communal farming. 

Famine quickly set in across the countryside, resulting in millions more deaths. People resorted to eating tree bark and dirt, and in some areas to cannibalism. Farmers who failed to meet grain quotas, tried to get more food, or attempted to escape were tortured and killed along with their family members via beating, public mutilation, being buried alive, scalding with boiling water, and other methods.

Industrialization

Large-scale state projects to increase industrial production were introduced in urban areas, and backyard steel furnaces were built on farms and in urban neighborhoods. Steel production was targeted to double in the first year of the Great Leap Forward, and Mao forecast that Chinese industrial output would exceed Britain’s within 15 years. The backyard steel industry produced largely useless, low-quality pig iron. Existing metal equipment, tools, and household goods were confiscated and melted down to fuel additional production.

Due to the failures in planning and coordination, and resulting materials shortages, which are common to central economic planning, the massive increase in industrial investment and reallocation of resources resulted in no corresponding increase in manufacturing output.

Millions of “surplus” laborers were moved from farms to steel making. Most were the able-bodied male workers, breaking up families and leaving the forced agricultural labor force for the collective farms consisting of mostly women, children, and the elderly. The increase in urban populations placed additional strain on the food distribution system and demand on collective farms to increase grain production for urban consumption. Collective farm officials falsified harvest figures, resulting in much of what grain was produced being shipped to the cities as requisitions were based on the official figures.

Important: Throughout the Great Leap forward, while millions starved to death, China remained a net exporter of grain as Mao directed grain exports and refused offers of international food relief in order to convince the rest of the world that his plans were a success. 

Instead, Mao's "Great Leap Forward" was a great leap forward to failure. If we look at it--who in the right mind would buy low-quality pig iron and bad crops from China at that time? I wouldn't and neither would any nation in the right mind! If Mao decided to copy Britain's plan--he would've given Communism a better name. Instead, Mao's idealism highlighted that while he was a brilliant military tactician--he was also a poor economist. Did Mao really think he was above the laws of nature? Supply and demand are natural laws. When Mao ordered the sparrows shot--pests got out of control as well! The results as spoken by survivors, are disastrous. 

The #SahodItaasPresyoIbaba economic model will not work even with all the insults either

The same goes for people who still think that, "It's just a game of numbers." The big question is why haven't they decided to open #SahodItaasPresyoIbaba stores (read here)? They should do what they want the government and businesses to do. They can start by selling PHP 20.00 per kilo rice and pay their employees PHP 750.00 per day. Why haven't they shown the government that such a business model works? They keep demanding the government for lower prices of good and higher salaries. Do these people even know basic accounting? 

Image by Sabrina Jiang © Investopedia 2020

No one can deny the basic income state is universal. Please, stop confusing revenues for profits for the nth time! Net profit is what's left after all the expenses are paid for. That's why the FDIs get the profits because it's barely a half of their revenue. Part of the expenses are taxes paid to the host country--which in turn is money for the government. If one were to increase the salaries--it would push the prices of goods and services up. If the cost of raw materials and other operating costs get higher--there's the need to increase the prices of goods and services! 

Graph taken from CFI

The same goes for the job market (read here). The job market is affected by supply and demand. If the demands for jobs go up--salaries will go up. How can you expect the demand for labor to go up if there isn't enough supply for job providers? If there were more establishments needing workers--there would be an increase in the demand for labor. The Corporate Finance Institute gives this insight on why salaries can't just be raised any time at a whim:

Supply and Demand in the Job Market

Similar to the markets of goods and services, job markets also follow the supply-demand mechanism. When the quantity of workers demanded is equal to the labor force available (the quantity of supply), the job market reaches its equilibrium point, and wages can be determined.

The wage level rises when the demand is greater than the supply and lowers when the supply exceeds the demand for workers. However,wages cannot always move freely. There is often a floor determined by the government, which is known as the minimum wage.

When the equilibrium wage is above the minimum wage level, introducing a minimum wage will not lead to a major impact on the job market. When a minimum wage is established at a level higher than the equilibrium wage, the quantity of demand will fall as businesses will instead try to control their labor costs by reducing the number of employees.

The quantity of supply increases as there are more active job seekers motivated by the higher wage level. It forms a gap between supply and demand and thus, leads to unemployment. Despite this drawback, the minimum wage policy can provide both economic and social benefits. By increasing the wages of low-income workers, the government can reduce its spending on social programs to support these individuals and relieve the economic inequality at the same time.

However, no matter how I try to discuss it, I get insults. Insults like, "Filthy capitalist!", "You're just greedy!", etc. are really not going to change the fundamentals. They refuse to understand these things, calling them as the "conspiracy of evil capitalists!" No, it isn't the conspiracy of evil capitalists. Even socialist nations like Vietnam and China have understood the basics. Deng Xiaoping Theory and Doi Moi by the late Nguyen Duy Cong (Do Muoi) operate on economic science. Sure, they can insult me all they want. That might be good proof that either they know they're lying or they just want to believe in their silly fantasies.