Interesting talk - warning it's about economics and politics

[Slobodan Blagojevic]

Should we not go back to the essential point of the original talk?

His point is that an economy needs a strong middle class to strive. He is also saying that the US is loosing this middle class quickly, partially because money is not distributed fairly. He is saying that we must find a way to have money distributed more fairly.

Do we all agree with that at least?

Cheers,
Bernard

I do, but many would dispute the very idea of "distribution."

Here is the thing with middle class and capitalism: the essence of capitalism is maximization of profit; profit can be maximized either by raising prices or by lowering costs; the quickest and easiest way to reduce cost is to reduce labor cost, thus all those mass layoffs, downsizings and outsourcings. So the cycle goes that way until capitalists gain maximum profit with the minimum of labor. Victory! But not so fast. All those laid off, downsized and outsourced people are not just labor cost, but also consumers, and guess what, they now can't afford products that capitalists are trying to sell. Turns out, a Pyrrhic victory... capitalists were cutting the branch they were sitting on (i.e., the middle class). It was so in the 30's and it is so now.

[BernardLanguillier]

Indeed, but this is driven by pre-conceived ideas about "distribution", influenced by the way it has been implemented in European countries.

Btw, an implicit, but obvious, conclusion he is also drawing without spelling it out is that capitalism let wild is incompatible with democracy...

Because, let's be clear, a plutocracy is not a democracy.

Cheers,
Bernard

[Alan Klein]

The whole issue is, in fact, very complex. No one, not even Nobel-winning economists, understands it in detail. For any individual to claim an understanding of these issues is the worst kind of hubris. But, we can make an effort to base our opinions on facts. For example, in my previous post I presented pretty solid evidence that inflation, even including food and energy, is not an issue. Yet you keep bringing inflation up - can I ask why? It COULD be a problem if it actually happened, but it is not happening.

As for "printing money," that's another falsehood. According to the World Bank, the US money and quasi-money supply has gone up by only 5% from 2004-2008, perhaps keeping pace with population growth. Since then, the money supply has remained relatively stable - up or down a bit depending on the measure used (M1, M2, or M3). So, this "printing money" notion is a bunch of horse hockey. Sounds like "Rush talk" or Fox news BS to me, and we all know (or should) what a gasbag full of lies and distortions they are.

Another ad hominem attack.  What is it with you Liberals?  Can't you make a cogent argument without trying to insult  someone.   As far as inflation and costs going up, your post indicates it went up 1.9% last year and I stated it went up 10.4% between 2008-2013.  So if you didn't get a 10.4% raise during that period, you cannot buy the same amount of goods as you did in 2008.  Unlike you, most Americans think the cost of living has gone up.  Your stated figure confirms, not disputes that as do my figures.

As far as printing, the Fed has printed $5 trillion dollars called euphemistically Quantitative Easing..  And the debt has grown from $9 trillion to $17 trillion dollars.  That isn't a "bunch of horse hockey."

[mezzoduomo]

What's the point of this 'discussion'? So much mock-erudition, in pursuit of....? What, exactly? The only remaining mystery is when (not if) it degrades sufficiently to get the ol' padlock treatment.

[Slobodan Blagojevic]

Killjoy!

[Robert Roaldi]

What's the point of this 'discussion'? So much mock-erudition, in pursuit of....? What, exactly? The only remaining mystery is when (not if) it degrades sufficiently to get the ol' padlock treatment.

As the person who opened the thread, I can only state that my intention was to bring to people's attention a point of view that isn't heard much. I thought it was an interesting talk, worth hearing. As of this writing, the thread has had over 600 views but only 44 participants, of which many are repeat participants, don't know how many unique ones. I know that oftentimes topics of this nature tend to become partisan ideological battles and that the threads degenerate, but maybe hearing the talk  caused some people to think about things in different ways, if that doesn't sound too pretentious. As one participant noted above, people highly knowledgeable in the field or economics, after years of study still find basic things to disagree about, which implies there is a lot more to learn, so maybe we shouldn't be too set in our ways.

[Slobodan Blagojevic]

...What is it with you Liberals?...

Did you just call me a Liberal!? That's ad hominem, buddy! See you in court!

P.S. I'll ask Gary Fong to bankroll me

[BernardLanguillier]

As the person who opened the thread, I can only state that my intention was to bring to people's attention a point of view that isn't heard much. I thought it was an interesting talk, worth hearing. As of this writing, the thread has had over 600 views but only 44 participants, of which many are repeat participants, don't know how many unique ones. I know that oftentimes topics of this nature tend to become partisan ideological battles and that the threads degenerate, but maybe hearing the talk  caused some people to think about things in different ways, if that doesn't sound too pretentious. As one participant noted above, people highly knowledgeable in the field or economics, after years of study still find basic things to disagree about, which implies there is a lot more to learn, so maybe we shouldn't be too set in our ways.

The most striking thing in this thread is that very few posts talk about the fundamental point raised in the talk, which isn't against capitalism, which is that a strong middle class is a pre-requisite for capitalism to be sustainable.

Cheers,
Bernard

[Slobodan Blagojevic]

The most striking thing in this thread is that very few posts talk about the fundamental point raised in the talk, which isn't against capitalism, which is that a strong middle class is a pre-requisite for capitalism to be sustainable.

Cheers,
Bernard

We do not talk about it as there isn't much to talk about it: we all assume that as given. Besides, nothing we said so far is against capitalism.

[BernardLanguillier]

We do not talk about it as there isn't much to talk about it: we all assume that as given. Besides, nothing we said so far is against capitalism.

Great! It should then be easy for all to accept the consequences of the measures needed to enforce the required increase of lower middle class income, such as increase of minimal salary.

Cheers,
Bernard

[Alan Klein]

I think we should also have a middle class minimum wage.  Automatic raises. Heck. I want in in on this action.  In fact, we should have it across the board for all income levels.  We should have some bureaucrat in Washington DC deciding how much we all earn.  Can't let those greedy business people make all these decisions.

[Slobodan Blagojevic]

Great! It should then be easy for all to accept the consequences of the measures needed to enforce the required increase of lower middle class income, such as increase of minimal salary.

I do support the increase in minimum wage, but I am afraid that minimum wage is not directly linked to the middle class, not even lower middle class. It is meant for the so-called working poor. Good forbid that the definition of middle class would include working for a minimum wage. Not that we are not approaching that level and fast (all those former middle class laid off and forced to work for minimum wage now, rapidly sliding out of middle class and into poverty.

[Slobodan Blagojevic]

...Can't let those greedy business people make all these decisions.

You got that right, Alan!

Capitalism, left to itself (i.e., to those "greedy business people") will ultimately kill competition, self-destruct and drag democracy into it (through monopolization and  concentration of economic and ultimately political power).

If you think I do not know what I am talking about, see the book from two professors from my business school: Saving Capitalism from the Capitalists

[mezzoduomo]

As the person who opened the thread, I can only state that my intention was to bring to people's attention a point of view that isn't heard much. I thought it was an interesting talk, worth hearing. As of this writing, the thread has had over 600 views but only 44 participants, of which many are repeat participants, don't know how many unique ones. I know that oftentimes topics of this nature tend to become partisan ideological battles and that the threads degenerate, but maybe hearing the talk  caused some people to think about things in different ways, if that doesn't sound too pretentious. As one participant noted above, people highly knowledgeable in the field or economics, after years of study still find basic things to disagree about, which implies there is a lot more to learn, so maybe we shouldn't be too set in our ways.

I appreciated your initial post. The talk offered a very interesting perspective and as you suggested, it caused me to think about things differently.
Thank you....

[PeterAit]

Another ad hominem attack. 

Do you really think that presenting solid and verifiable facts that dispute your argument is ad hominem? Wow.

[Alan Goldhammer]

As far as printing, the Fed has printed $5 trillion dollars called euphemistically Quantitative Easing..  And the debt has grown from $9 trillion to $17 trillion dollars.  That isn't a "bunch of horse hockey."

You cannot look at debt in the abstract but rather as a percentage of GDP for a country or as how it relates to cash flow in terms of a corporation.  The debt/GDP ratio has changed for the better and now is the lowest in about six years or so.  There was a Congressional Budget Office report released earlier this month that looked at things favorably.  Similarly, I can report the debt of my LLC in some measure say $1000 while IBM might say theirs is several million $.  This is meaningless.  If my cash flow is $700/year that means I cannot cover the debt.  If IBM's revenue is $1B they easily can cover the debt.

[Alan Goldhammer]

The most striking thing in this thread is that very few posts talk about the fundamental point raised in the talk, which isn't against capitalism, which is that a strong middle class is a pre-requisite for capitalism to be sustainable.

Cheers,
Bernard

I did try to address this in one of my earlier posts.  I fully agree with this point and one can look to the demise of manufacturing in this country as an elimination of one path to the middle class.  there have been some excellent photojournalists who have been chronicling this.

[BernardLanguillier]

I think we should also have a middle class minimum wage.  Automatic raises. Heck. I want in in on this action.  In fact, we should have it across the board for all income levels.  We should have some bureaucrat in Washington DC deciding how much we all earn.  Can't let those greedy business people make all these decisions.

I wasn't sure everyone was convinced...

Cheers,
Bernard