Re: [Paddlewise] CO2 output

From: Peter Chopelas <pac_at_premier1.net>
Date: Fri, 06 Jul 2007 18:38:43 -0700
Mike wrote: -
>> resource price at the wellhead is zero - no one pays Mother Earth

This is true of all recourses (and it demonstrates a misunderstanding of 
value).  The sun shines for free, the wind blows for free, water flows 
from the mountains to the ocean for free, trees grow for free, oil, 
coal, natural gas, uranium, etc. all are found in the ground for 
"free".  But that is irrelevant because we pay for all things based on 
their market value, which is what the supplier adds.

For example, you can grow a tree for free, wait a long while, cut it 
down yourself, mill it into lumber yourself and build yourself a boat, 
house, etc.  Or you could buy the wood, paying someone else to grow it, 
harvest it, mill it, ship it to your neighborhood where you can buy it.  
Or you can pay big $ to a craftsman to build you a nice wood kayak. What 
you are paying for for someone else to get it, rework it, and deliver 
it. Each adds value, making it worth more at each step. 

So in once sense all recourses only carry a value based on the added 
value, which is what someone is willing to pay for it.  The "profit" 
that each person that handles the goods in the system is the value that 
each one adds to the item.  A kayak builder has to sell the kayak for 
more than the material and labor costs to make it or the builder goes 
out of business. If people are not willing to pay more than the cost of 
making a product, than the builder either has to find a way to make it 
less expensive (use less resources), or change the design to make it 
more desirable (customers willing to pay more for it).   This is true of 
all products, cars, houses, computers, etc. The fact that most are 
willing to pay more for milled lumber than raw logs is how the miller 
makes a living, it is how the kayak builder makes a living.  If you make 
everything yourself from raw materials you will have NO time to do 
anything besides feed and cloth yourself, all your waking hours will be 
spent making food and clothes.  That is the basis for all market 
systems, what we call an "economy".  And it is the reason we have time 
to enjoy kayaking, the value of our work is worth more than the cost of 
buying clothes, food, housing, etc.  what is left over is good for 
kayaking.  You hopefully add value to your employer more than the cost 
for you to work there (or the employer will go out of business and you 
will be unemployed).  To not understand that means you do not understand 
how all things have value, and how our economy works, employs people, 
and provides a pretty good living for most people that have skills to 
offer.  Profit is only a measure of the value added by the supplier, the 
more the profit, the more value added over the cost of the raw 
materials, that means the moret people are willing to pay to get their 
goods or services rather than do it yourself.

The more raw materials and labor that goes into a product, the higher 
the cost, and the higher the recourse consumption.  The only exception 
to that is cost of unnecessary government regulations and taxes.  That 
is why both are "evil" costs to any economy, they bog it down without 
adding value.  Note I used the words there "unnecessary", for the sake 
of public health and safety (including environmental protection), 
stability and well being, certain regulations and taxes are necessary.  
The real debate is what is a benefit to us as citizens, and what is 
really necessary.
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Received on Fri Jul 06 2007 - 18:38:36 PDT

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