I know there must be reasons and this is a dumb question, but I’m a bit of an abstract thinker and have trouble grasping it from a big picture presepctive. Can someone break this down for me? Can’t we all just kind of agree to just kind of… Reset some numbers or something?
Sincerely,
I’ve never taken an economics class in my life
In: Economics
>Can’t we all just
Any economic proposal that starts with these words can be safely dismissed. All it takes is for one country to ignore the agreement for it all to fall apart. And there would be incredible incentive to do so.
Even if you could force compliance through military action, you can’t “pause” the consumption of food, hospitals, pharmacies, police, utilities, etc. If you tried only “pausing” part of the economy, once you map out the chain of dependencies, you’d quickly realize how linked these are to every other industry.
You’re touching on abstract anarchist theories. P.J Prodhun asked the same question and designed the whole philosophy of anarchism around the idea that we don’t really need money.
To answer your question, there’s nothing preventing what you are suggesting. Except doing so would cause a breakdown of all market forces as we know them. Money and the markets are just very complex zero-sum games. But “pausing” that game would mean nothing within the game would function.
It would be like a game of monopoly, where the banker suddenly says that the bank would close down for three spins around the board. There is nothing stopping this scenario, except it violates the nature of the designed system, and therefore the system would collapse . In this case, the monopoly game would be very boring as no one could purchase property or mortgage or do anything but barter with the other players.
That’s basically what would happen in reality as well, but on a much grander scale.
The simplest answer is because we cannot hit pause on our consumption of items that have “value”, e.g. food, rent, public transport or petrol for your car, etc.
Businesses need to continue to pay rent and salaries, people need to continue to eat, etc. And because the global economy is dependent on everyone continuing to transact with each other at an expected or ever-increasing rate, hitting pause is the exact thing that will cause a global economic crisis.
fundamentally: you can’t pause the value people actually place on things. if beanie baby trading were banned 20 years ago and legalized today, would you be willing to pay 2000 prices?
We can. The US paused the stock market after a big dip a couple of times recently and closed it after 9/11. France is pausing all rents and utilities bills. Italy is pausing mortgage payments. Jeremy Corbyn, Labour leader in the UK, is asking for the same.
So we can do it. It’s just that in the US our government is so corrupt that they can’t even pass paid sick leave. Capitalism will be the death of thousands and many wont even know why.
There’s better answers from others on this thread, but the simplest way I can think of it is… Someone has to lose. You need to eat, pay rent, or whatever. To do those things, you have to either pay (which means you need to be working, or your employer has to pay you to not work), or the provider of that good/service has to give it to you for free and pay their employees to provide it. That’s in the “real” economy.
Now the share market is different, and that gets “paused” all the time. They have automatic suspension trading when the losses get too big in any single session, and that’s been activated a couple of times. To achieve this would be disruptive, but I suppose the stock exchange or government may be able to shut the whole thing down for an extended period.
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