“Earning”

While I was home for Thanksgiving, my dad and I had several conversations about economics that centered around people’s earnings and their rights to them.

I think our issues were largely semantic — we use the word “earned” with at least two distinct senses:

  • Exchange of Labor — Bob cleaned the gutters on my house and earned $35.
  • Capital Investment — In the last 30 seconds, Warren earned $4718 in the market.

(That’s $62 billion at the historical 8% return from the stock market. Of course all his money isn’t in the stock market, and he likely has less now than he did a few months ago, but the idea’s the same.)

$62×109
.08year
1 year365 days
1 day24 hours
1 hour60 minutes
1 minute60 seconds
30 seconds

$4718.42

I don’t think that it makes sense to treat these two transfers of money as even remotely similar in terms impact on a person’s life or amount of effort put forth. I don’t really know the terms to use to separate “earning” in investment from “earning” in labor, but I think I would have an easier time talking to my dad if I could create a separation.

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