Barriers in Discussion
One of the recent conversations I had with some friends concerning economics came across a problem that I think is very common - the difference between producers and consumers in regards to surplus. It turns out that almost everyone has a Marxist view of the producers and consumers, which the managers and owners, a.k.a. “the Man”, are the producers and the workers and “average Joes” are consumers. So from this perspective, it does set up a class vs. class issue. However, what should be taught is that these people are essentially the same. Since we assume zero profits (competitive industry), we know that the entire producer surplus goes to rents and wages. Wages here are key, since if you take some producer surplus, you take away worker wages, and thus hurt the “average Joe.” And the consumer can just as easily be “the Man.” What if that industry is luxury yachts? Luxury taxes hurt the “average Joe” much more than “the Man” precisely because Joe was the producer, and “the Man,” as a consumer, could just as easily go without a yacht and find something else to buy. This topic can be very important in a regular conversation, because while the young Marxists are out their thinking they’ll “stick it to the Man,” they’ll really be sticking it to themselves.
