... But if there is drag when both the magnet and disk spin together, then what is it dragging against???...
We have a circuit in two parts connected by sliding contacts and moving relative to each other in a magnetic field. What matters is only their relative movement. It does not matter whether the magnet is attached to one half circuit (the rotating disc) or to the other (fixed with the sliding contacts) because the relativity of the movement of each half-circuit with respect to the other remains the same in both cases. It does not matter whether it is such a half-circuit that rotates relative to the observer (e. g. the disc) or the other (the half-circuit with the sliding contacts) because the relativity of the movement of each half-circuit relative to the other remains identical. Explanation: charges with speed V in a magnetic field B see an electric field E=VxB and the charges in each half circuit do not see the same electric field because of their relative velocity which makes "V" different, therefore E different, therefore there is a potential difference between the two half-circuits. V and B is the viewpoint of the observer on the charge. E = VxB is the viewpoint of the charge and F = q.E = q.VxB is what the charge feels. Electromagnetism is only a set of relativistic effects on the electric field.
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