Archived What would be the actual results if the poorest 20% of each country dissapeared one day? (AskVoat)
submitted ago by Cannibalguy
Posted by: Cannibalguy
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Archived What would be the actual results if the poorest 20% of each country dissapeared one day? (AskVoat)
submitted ago by Cannibalguy
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[–] rwbj ago
Next to nothing.
I think something people don't consider is that our economy is built on ratios - not raw numbers. You could fundamentally break our entire economy down into a ratio of the number of workers needed to provide all currently produced goods and services for the entire country. That number, thanks to technology, has been decreasing over time. And similarly you have a ratio relating to the amount of consumption needed to sustain a business. This is also decreasing thanks to technology, but probably at a slower rate.
Anyhow, when you change anything in raw numbers - you still end up with the same situation. If 20% of the poorest disappeared then suddenly a ton of businesses would disappear. It wouldn't just be the businesses that those 20% patronized either. You have to keep in mind that businesses are interconnected with one another in countless ways. Those businesses shutting down would result in a massive spike in unemployment (remember now that we only have 80% of the population each unemployed individual counts as even more, in percent times) and we'd, after a very chaotic period, likely trend towards an equilibrium pretty much the same as we have now.
So for instance one of the most disruptive issues we're having is a supposedly low labor force participation rate. When Trump said the US has a 40% unemployment rate, that was in the most literal sense true. Only 63% of Americans are in the workforce - the rest are unemployed. Some Americans think this is an American issue. Here is a list of the workforce participation rate for most countries in the world. And you'll see that among developed nations most are near identical to the US. The only countries with very high workforce participation rate tend to be very poor, undeveloped nations. Modern technology, for better or for worse, means an increasingly large percent of every country is (again in the most literal sense) unemployed.