Luminous Landscape Forum
The Art of Photography => The Coffee Corner => Topic started by: Robert Roaldi on August 15, 2014, 11:23:17 am
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http://www.ted.com/talks/nick_hanauer_beware_fellow_plutocrats_the_pitchforks_are_coming#t-690342 (http://www.ted.com/talks/nick_hanauer_beware_fellow_plutocrats_the_pitchforks_are_coming#t-690342)
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Very interesting. I'll be watching the Seattle 'experiment' over time...
Additional testing in different places that have other kinds of diverse economies would be a great next step.
If we could get to $9.00 in Phoenix, $11.00 in Miami, $14.00 in Los Angeles, etc, and measure carefully, we'd have additional objective evidence which would help refute the preconceived notions.
"Ecosystems" (as defined in the talk) have a tremendous ability to adapt, and this particular stimulus might prompt very positive adaptations.
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Raising minimum wages just eliminates jobs for the young and unskilled. If you want to help people, reduce taxes to increase money available for investments to grow the economy providing more jobs and for people to buy things they need. Also, stop printing money to pay for government deficits. That also reduces money available to buy things by raising the cost of everything due to inflation. These policies hurt middle income people and the poor and others on fixed income like retirees the most.
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...to increase money available... and for people to buy things... That also reduces money available to buy things
lovely logic...
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Raising minimum wages just eliminates jobs for the young and unskilled. If you want to help people, reduce taxes to increase money available for investments to grow the economy providing more jobs and for people to buy things they need. Also, stop printing money to pay for government deficits. That also reduces money available to buy things by raising the cost of everything due to inflation. These policies hurt middle income people and the poor and others on fixed income like retirees the most.
Talking about "preconceived notions."
Didn't we decrease taxes in the Bush years and kept them low even during the current administration? Aren't they currently at their historic lows? "To increase money"? Historically, there has never been so much money stashed in corporate cash reserves as today, and profits are also hitting historic highs. Inflation? What inflation?
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Beside federal income taxes, there are social security, state, city, sales, real estate and other taxes. My real estate taxes this year went up 9%! That money is not available for me to save, invest or to spend so my standard of living goes down. Although I was referring to personal taxes in my last post, higher corporate taxes also effect us if we own any stock such as through our 401K or other retirement plans. If companies pay higher corporate taxes, less income is distributed to the stockholders - us - so we are also directly effected by corporate taxes.
Let me answer your question about, "What inflation?" In the 5 years (2008-2013) inflation has gone up over 10%. http://www.usinflationcalculator.com/inflation/current-inflation-rates/ I haven't had a raise since 2008. (I retired last year). Therefore, my salary has a purchasing power of 10% less than it could buy things in 2008. It's as if someone was lowering my salary by 10% during this period. It also reduced by 10% the purchasing power of my savings. In effect, that inflation is a hidden tax that decreases my standard of living by reducing the value of the dollar. And yours!
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My real estate taxes this year went up 9%! That money is not available for me to save, invest or to spend so my standard of living goes down.
well, where are your RE taxes are going ? I bet to pay some overpaid municipal employees (or retirees), so that they can increase their disposable income ::) - so not that bad... or may be to pay off some bonds that were still issued to finance some school construction ? again - workers were paid, building materials suppliers were paid... may be even some kickbacks - but that again increases the income for somebody
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The redistribution of wealth through taxes go mostly to the higher income earners who invest and to businesses. All that money that was printed went to the bankers and other in the financial businesses. Crony-capitalism, not true capitalism. Likewise, inflation mainly helps the rich to pay back debt and investment to increase their wealth with cheaper inflated dollars. The average person just see the cost of living going up. It's true that taxes do help governmental workers. But most people don't work for the government. They're the ones whose taxes pay for the government workers. They're the ones with less disposable income struggling to make ends meet.
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Raising minimum wages just eliminates jobs for the young and unskilled. If you want to help people, reduce taxes to increase money available for investments to grow the economy providing more jobs and for people to buy things they need. Also, stop printing money to pay for government deficits. That also reduces money available to buy things by raising the cost of everything due to inflation. These policies hurt middle income people and the poor and others on fixed income like retirees the most.
Inflation? Oh wait, there is none. Oops. Raising minimum wage reduces jobs? Oops, absolutely no evidence for this. Oh my! Trickle-down theory? Disproved over and over and over again, but what the hey, Rush and Fox say I should believe it. Facts? I hate 'em. I make up my own.
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The redistribution of wealth through taxes go mostly to the higher income earners who invest and to businesses.
and where do they invest ? I 'd assume that they invest extra money after "redistribution of wealth through taxes" in the same places where they 'd otherwise invest w/ lower taxes :-)... so what is your logic again ? or is it the same pearl like "to increase money available... and for people to buy things... That also reduces money available to buy things "
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I read Hanauer's piece a couple of months ago. The fact is that in the US we are under taxed compared to the rest of the developed world. We are almost the only country left that does not have a national sales tax (Value Added Tax) and our corporate and individual tax laws are a joke, replete with loop holes. I live in a high tax state and locality but I don't mind paying taxes as we have lots of parks, an extensive library system, excellent schools (two daughters went all the way through public schools so I didn't have to pay out private school tuition), and roads that are well kept up. My bottom line is that if the government can show demonstrable public good through the expenditures, I'm happy to pay taxes. What I really want to see is a total overhaul of the tax system so that all the preferences that are inherent are done away with.
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Inflation? Oh wait, there is none. Oops. Raising minimum wage reduces jobs? Oops, absolutely no evidence for this. Oh my! Trickle-down theory? Disproved over and over and over again, but what the hey, Rush and Fox say I should believe it. Facts? I hate 'em. I make up my own.
"Trickledown theory" is a shibboleth. It can't have been disproved, because it was never implemented. We can talk about supply side control of inflation or something if you wish, but when you start playing the "trickledown" card, you're quoting sources at least as biased as those you're mocking.
No inflation? Really? Yes, one widely quoted federal inflation indicator has been relatively flat for a long time. That indicator specifically excludes food and energy costs, which are a huge portion of the budgets of low income folks. Meats are at record high dollar levels, for example, which can be traced back to the costs of feed, which have been hit hard by a number of other factors. Would you like to list the items that have gotten much less expensive that balance out those two?
No evidence that raising minimum wage reduces jobs? I don't need anyone's study to tell me that I won't be hiring any more minimum wage employees. Here's the problem with minimum wage for those of us who actually hire people - you can only raise the costs of employing low skilled people to the point where it becomes more cost effective to instead divert that money to others. I know what the total cost of employment is for all of my staff. I know what happens when I have to carry the ones that go on federally mandated family and medical leave. At this point, there's no way I'm hiring anyone to sweep up around the office, or file papers or something because it would cost me a lot more than just giving a couple of the others a few hours of overtime. This is why unemployment levels for young people are so high right now.
I don't run a business that relies mostly on low-skill workers though. If I did, and my hourly labor costs suddenly went way up, you know what I'd do? Look for the people that were attracted back into the labor pool by the higher wages. Hint - they would not be young, entry level kids.
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and where do they invest ? I 'd assume that they invest extra money after "redistribution of wealth through taxes" in the same places where they 'd otherwise invest w/ lower taxes :-)... so what is your logic again ? or is it the same pearl like "to increase money available... and for people to buy things... That also reduces money available to buy things "
I think you're missing something important. Federal taxes have to be used somewhere. Typically, to hire more highly paid federal workers in DC. If I invest more money on my own, it's likely to be toward things that increase productivity.
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lovely logic...
Not a fair read of his statements. His argument is that lowering taxes increases the money available for investments. What he claimed would reduce the money available for investment was excessive federal borrowing, not the lowering of taxes. Two different ideas.
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I think you're missing something important. Federal taxes have to be used somewhere. Typically, to hire more highly paid federal workers in DC. If I invest more money on my own, it's likely to be toward things that increase productivity.
we are talking not about you, but about low paid dudes who do not have an IQ developed enough to earn $$$ outside of low paying hourly (w/o benefits mostly) positions... why do you think your investment will be better then investment of those "highly paid federal workers in DC" in regards to creating more jobs for low paid dudes or creating a job market demand for low paid dudes that shall allegedly drive their compensation higher ?
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Not a fair read of his statements. His argument is that lowering taxes increases the money available for investments.
I think you need to reread his text he says that there will be (in the end, as a result of his suggestion) more money for people to buy things and at the same time his suggestion "reduces money available to buy things by raising the cost of everything due to inflation"... what one hand gives the other takes.
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At this point, there's no way I'm hiring anyone to sweep up around the office, or file papers or something because it would cost me a lot more than just giving a couple of the others a few hours of overtime.
so do you pay 1.5 for overtime (overtime and this is non exempt job) for somebody to sweep around the office ?
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...This is why unemployment levels for young people are so high right now...
How so? There hasn't been any increase in minimum wage yet. On the contrary, real minimum wage (i.e., adjusted for inflation) has been steadily eroding over the last decade or so.
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How so? There hasn't been any increase in minimum wage yet. On the contrary, real minimum wage (i.e., adjusted for inflation) has been steadily eroding over the last decade or so.
Assuming you're right and low wage employment levels are down for other reasons, how would raising minimum wage raise employment levels for these people? If businesses are not creating jobs at the current minimum rate, why would they create jobs at a higher rate? In fact, the amount of jobs available are always reduced when the minimum rate goes up.
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I think you need to reread his text he says that there will be (in the end, as a result of his suggestion) more money for people to buy things and at the same time his suggestion "reduces money available to buy things by raising the cost of everything due to inflation"... what one hand gives the other takes.
That's not what I said. I said that government printing of money devalues our purchasing power. That means we can purchase less for each dollar because each dollar is worth less. That's what inflation is all about. To state there is no inflation, as you have done, is just plain wrong. A simple check of the inflation rate between Jan2008 through Dec 2013 indicates a cumulative 10.4% increase. http://usinflation.org/us-inflation-rate-calculator/ If you were taking home let's say $50,000 in Jan 2008, and you had no subsequent raises, the $50,000 would have less than $45,000 in purchasing power in Dec 2013. Inflation by the Fed and subsequent raising of costs to buy things, would cause an unseen tax of over $5000 this year. It's actually higher since there's inflation this year in 2014 as well.
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This speech makes total sense to me.
I have always thought that the degree of civilization of a country is defined by the way it treats it "poorest" citizens.
Treating the lower class in such a way that it has a real opportunity to become a middle class translates into higher level of education for better employability and into a general raise of the level of the country, pushed up from the bottom instead of being, supposedly, pulled from the top.
We need a middle class just as badly as need roads and electricity and that has to be regulated. The infrastructure he is talking about is state intervention and it is required to enable the middle class to be back into existence first and then back into prosperity.
The tough part is of course to come out of the current situation and to move back to a virtuous circle. Raising the minimum wage is a reasonable approach to put things in motion, even though I do understand the reluctance of those company owners who see this as a short term threat to their profitability.
Of course, this is also a means for Washington state to attract reasonably qualified people unable to find jobs in neighboring states. ;)
Cheers,
Bernard
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The minimum wage discussion is interesting. If raising it is bad for the economy, does it mean that lowering it is good for the economy? Because of inflation, frozen minimum wages are worth less over time, so some extent the USA might be experiencing the "lowering" scenario. We (US and Canada) have been certainly experiencing frozen levels of income for the middle class for years now. Is all of that good for economy? If so, shouldn't we all be way better off by now? Is that how we're trending?
What does the phrase "good for the economy" mean exactly? I'm sure that lowering the payroll obligations of companies that hire lots of minimum-wage employees is good for them, in the short term, but is the strategy good for the wider society? Sometime in the late 1970s, The then federal government of Trudeau raised the minimum wage (I forget to how much or which year) and in a media scrum a reporter asked, What if some companies cannot afford to pay the higher minimum wage? His answer was a blunt, Maybe those companies shouldn't be in business.
If lowering the minimum wage is good, is eliminating it a good thing? I've heard it proposed that salaries should be determined only by market forces (let's assume that we have a free labour market, economists always make lots of assumptions so why shouldn't we). Would it be ok to pay with room and board, no money? I'm sure we could find desperate people who would agree to work under those conditions, sort of a share-cropping economy. I'm also sure that would be great for someone, but is it a good idea for the country as a whole?
Maybe it's me but discussions about taxes always seem wrong-headed to me. Discussing the tax rate based on "I think I pay too much" is silly. Everyone always thinks they pay too much for everything and simultaneously think that they don't earn enough themselves. Judging how much tax to pay is nonsensical unless you first decide how much service you need. First decide that, all else follows.
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I think you're missing something important. Federal taxes have to be used somewhere. Typically, to hire more highly paid federal workers in DC.
Actually not, Federal employment in the DC area has been going down in recent years. Additionally, there is a pay ceiling for these workers and they generally can make more in the private sector.
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Assuming you're right and low wage employment levels are down for other reasons, how would raising minimum wage raise employment levels for these people? If businesses are not creating jobs at the current minimum rate, why would they create jobs at a higher rate? In fact, the amount of jobs available are always reduced when the minimum rate goes up.
This is a tricky question to answer satisfactorily. It's not that jobs are not being created but rather one needs to also consider jobs lost because of international competition. I just finished reading "Factory Man (http://www.amazon.com/Factory-Man-Furniture-Offshoring-American/dp/0316231436/ref=sr_1_1?s=books&ie=UTF8&qid=1409313883&sr=1-1&keywords=factory+man+beth+macy)" by Beth Macy which is an engrossing book about the furniture industry in North Carolina/Virginia and how it virtually disappeared over a 20 year time span to the Asian countries of China, Vietnam, Indonesia, and to a certain extent Taiwan. Several hundred thousand jobs were lost in this region and they won't come back. This parallels the disappearance of the textile industry which left this country a little earlier. The furniture case is interesting since it was proven that some Chinese manufacturers were building at below true production costs and "dumping" furniture into the US. Despite winning the International Trade Administration case, the damage was already done to the US manufacturers (who by and large were already importing from abroad and only doing some "final finishing" in the US).
This country has created lots of service industry jobs and some of these such as those in the financial services can be high paying. Those in the fast food, big box retail, hotel maintenance, etc. tend to be minimum wage or slightly above. There are lots of stories about individuals having to work two jobs just to keep afloat.
Several years ago I posted a challenge to a well known political blog offering $10,000 to anyone who would spend a month or so to give up their creature comforts and work a minimum wage job. there were no takers. This was sort of like what Barbara Ehrenreich did in the research for her book, "Nickel and Dimed: On (Not) Getting by in America (http://www.amazon.com/Nickel-Dimed-Not-Getting-America/dp/0312626681/ref=sr_1_4?s=books&ie=UTF8&qid=1409313746&sr=1-4&keywords=barbara+ehrenreich)."
There are no easy answers.
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"Trickledown theory" is a shibboleth. It can't have been disproved, because it was never implemented.
"Trickledown" may be a popular term without a clear definition, but it most certainly has been implemented to a greater or lesser degree in the US as a whole and also in individual states. Putting more money in the hands of business owners and the well-off has never - NEVER - been shown to result in an improvement in the lot of the less well-off.
No inflation? Really? Yes, one widely quoted federal inflation indicator has been relatively flat for a long time. That indicator specifically excludes food and energy costs, which are a huge portion of the budgets of low income folks. Meats are at record high dollar levels, for example, which can be traced back to the costs of feed, which have been hit hard by a number of other factors. Would you like to list the items that have gotten much less expensive that balance out those two?
Yes, really. According to the US Bureau of Labor Statistics report (August 19th) the CPI (excluding food and energy) rose 1.9% over the past 12 months and the all-items index (including food and energy) rose 2.0%.
No evidence that raising minimum wage reduces jobs? I don't need anyone's study to tell me that I won't be hiring any more minimum wage employees. Here's the problem with minimum wage for those of us who actually hire people - you can only raise the costs of employing low skilled people to the point where it becomes more cost effective to instead divert that money to others. I know what the total cost of employment is for all of my staff. I know what happens when I have to carry the ones that go on federally mandated family and medical leave. At this point, there's no way I'm hiring anyone to sweep up around the office, or file papers or something because it would cost me a lot more than just giving a couple of the others a few hours of overtime. This is why unemployment levels for young people are so high right now.
Surely you realize that your own business experience is irrelevant to the larger question? Actually, you do need studies to determine the effect of increasing the minimum wage on employment. There have been many such studies, and some have shown a negative effect, some have shown a positive effect, and many have shown no effect. Likewise, when a large number of economists across the political spectrum were asked if increasing the minimum wage hurts employment, about 1/3 said yes, 1/3 said no, and 1/3 said they didn't know. So, if you're against raising the minimum wage, fine, but don't use the "it hurts employment" argument because it just ain't so.
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I think you need to reread his text he says that there will be (in the end, as a result of his suggestion) more money for people to buy things and at the same time his suggestion "reduces money available to buy things by raising the cost of everything due to inflation"... what one hand gives the other takes.
No, he's contrasting two different options. They aren't connected. What he said "reduces money available to buy things by raising the cost of everything due to inflation" is excessive government borrowing. He's saying "more money for people to buy things" part would come from lower taxes.
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so do you pay 1.5 for overtime (overtime and this is non exempt job) for somebody to sweep around the office ?
Depends on the specific math, and obviously whether you pay by the hour or not. Remember, if I pay someone $20 an hour, that's not my total cost. After taxes, benefits, etc., it can be nearly double that, depending on where they fit on the scale. I don't actually pay for janitorial stuff out of my budget, but I do have a couple of clerks. I have two more who are retired, but work for me 1/4 time. Their hourly rate is more than twice the recent hires', but it's still cheaper for me to keep paying them than two hire another full-time entry level person.
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Minimum wage is really a side issue that effects the economy very little. It's a way for the politicians to keep the public's eye off of the main issues they should be addressing such as high personal and corporate taxes, printing of money, deficit spending, and subsidies that distort normal market forces. If these were lowered even a little, the economy would expand and provide more jobs at higher wages including those jobs at the bottom of the economic ladder.
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How so? There hasn't been any increase in minimum wage yet. On the contrary, real minimum wage (i.e., adjusted for inflation) has been steadily eroding over the last decade or so.
That's true only at the federal level (unchanged minimum wages I mean); states and localities can set their own minimums. But it's definitely the case that wages are declining in real terms overall.
About 10 years ago, I went to visit my brother-in-law in WY. At that time, the starting wage for fast food workers was $12. Not because of a law, but because of a tremendous labor shortage. I'd be interested in what they're paying now.
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That's true only at the federal level (unchanged minimum wages I mean); states and localities can set their own minimums. But it's definitely the case that wages are declining in real terms overall.
About 10 years ago, I went to visit my brother-in-law in WY. At that time, the starting wage for fast food workers was $12. Not because of a law, but because of a tremendous labor shortage. I'd be interested in what they're paying now.
Yes, but those state and local minimums are only slightly above the federal, and even those have not changed in the last decade. Besides, those $12 in WY I suppose were not the official minimum, but a market-driven one?
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... If these were lowered even a little, the economy would expand and provide more jobs at higher wages including those jobs at the bottom of the economic ladder.
Once again, Alan, those were lowered under Bush, and guess what happened? No more jobs, no higher wages, not just for the bottom, but also not for the middle. The only benefit was to the top, and that means, very, very, top, the 1%, 0.1%, and especially the 0.01%. They increased their share in the national wealth by unprecedented percentage in the last decade, with nothing, absolutely nothing "trickled down." On the contrary, the rest of the nation, the insignificant minority of 99% ended up worse. For the first time in its history, the U.S. is not an optimistic nation: the majority now believe that the next generation, their children, will have it worse than they had.
Besides, Alan, regurgitating Econ 101 generalizations, good only for introducing clueless teenagers to the subject, is not going to help us here with this debate.
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"Trickledown" may be a popular term without a clear definition, but it most certainly has been implemented to a greater or lesser degree in the US as a whole and also in individual states. Putting more money in the hands of business owners and the well-off has never - NEVER - been shown to result in an improvement in the lot of the less well-off.
Actually it has in Kansas with horrible results. Governor Brownback got an across the board tax cut passed using this argument. State is now in horrible financial position and Brownback a Republican stands at this point to be defeated in the general election this November. This is a state that is reliably Republican but the citizens are furious. Do a Google search on 'Governor Brownback Tax Cuts' and you will get whole slew of interesting articles to read.
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Once again, Alan, those were lowered under Bush, and guess what happened? No more jobs, no higher wages, not just for the bottom, but also not for the middle. The only benefit was to the top, and that means, very, very, top, the 1%, 0.1%, and especially the 0.01%. They increased their share in the national wealth by unprecedented percentage in the last decade, with nothing, absolutely nothing "trickled down." On the contrary, the rest of the nation, the insignificant minority of 99% ended up worse. For the first time in its history, the U.S. is not an optimistic nation: the majority now believe that the next generation, their children, will have it worse than they had.
Besides, Alan, regurgitating Econ 101 generalizations, good only for introducing clueless teenagers to the subject, is not going to help us here with this debate.
You are mistaken what Bush did. He raised deficit spending due to the tax load of the wars in Iraq and Afghanistan, increased printing dollars and lowered the Fed rate creating the boom the ended in the recession and bust of 2008. Obama and the current Congress has doubled down on what Bush did. Deficits are even higher, there's more money printing, and interest rates are even lower. These all are adding to another balloon whose bust will be even greater than the last.
You also are mistaken about what I said about the rich. If you read my posts, it indicates that the above actions by the government helps the rich more than the middle class and poor. So even Obama's policies to help the poor are really benefitting the rich.
And I'm not regurgitating Eco 101 generalizations to clueless teenagers but stating well established economic theories of the ages pronounced by experts in the field. I'm sorry that your best retort to my points is to insult my intelligence with ad hominem attacks. I expected better from you.
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You are mistaken what Bush did...
Bush lowered taxes. Period. You keep repeating the mantra of "just lower taxes and all is good."
And I'm not regurgitating Eco 101 generalizations to clueless teenagers but stating well established economic theories of the ages pronounced by experts in the field. I'm sorry that your best retort to my points is to insult my intelligence with ad hominem attacks. I expected better from you.
I do not know where you find ad hominem. There was no intention to insult your intelligence. By the same token, there is no need to "insult our intelligence," to borrow your term, by repeating Econ 101 to a grown-up audience here. I said "Econ 101 generalizations" and you said "established economic theories" which I consider one and the same. Both are good as an introduction into economics, but not an almighty answer to more complex issues. There are numerous advances in economics since the "theories of the ages," just like there are advances in physics after Newton. Otherwise, we could just stick to Adam Smith and explain everything happening today.
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OK. I accept you had no intention of insulting me. I like you and this is only a discussion, after all. I doubt if we'll change anything. But I will say that this whole issue is not complex. Most people understand that printing money is no good because inflation reduce the purchasing power of their dollars. Most people know that raising taxes reduces the money available to them to buy stuff. Most people know that deficit spending and debt has to be paid back at some point and this will hurt. Most people know that subsidies and deals the government makes with certain industries is unfair to the average American as well as to the industries not favored by the government. You don't have to be an economic wizard or a teenager or Adam Smith to understand these things.
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... Most people understand that printing money is no good because inflation...
Correct... in general terms. And trust me, if anyone knows what inflation is, it would be me. I come from a country that holds a world record in inflation... a whopping 100%...per day!
But I asked already "What inflation?" There was no increase in inflation after the quantitative easing (QE) by Fed (which I assume you are referring as "printing money"). The inflation you cited, about 2% per year, is a normal, almost unavoidable inflation, just like about 5% unemployment is considered "natural."
... Most people know that raising taxes reduces the money available to them to buy stuff...
Again, way oversimplified. Things in economics do not have such a linear, one-dimensional, cause-consequence effect. Take for example property taxes. Where I live (Midwest), they actually went down, after reassessing property values. But even if they didn't, I would be more than happy to pay that and more. My father used to say that he is very happy when he pays taxes. To my astonished look, he would explain that's because he has reached the income level that requires him to pay taxes. I am a happy man when I pay taxes and I would not mind paying more, IF I would know that would not end in the fat cats pockets (for instance, when they finance unnecessary wars, which is just a good business for the 1%-ers). In the case of my property taxes, 65% of that goes to the school district, which results in it being among the best in nation. So, what would I rather choose, to pay less than $7K or $8K in property taxes that I am paying now, or to pay $12K - $20K for a private school instead?
Paying more taxes also results in more people having jobs or getting paid better. First through domestic government spending, then through secondary demand when those new or better paid jobs start spending money. More consumer spending means more new jobs created in the non-government sector as well.
Paying more taxes also means more money for the underprivileged, thus less of them forced into crime, thus I'll have a safer life. Or more police and firefighters protection. Or more and better teachers.
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Or more and better teachers.
provided that unions are curbed a little - no life time tenures.
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Depends on the specific math, and obviously whether you pay by the hour or not.
nope... making janitor a salaried janitor won't make him exempt... I do happen to work in a staffing business, so I'd assume (unless you work in the same business) I deal with that more in a week than you in several years.
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OK. I accept you had no intention of insulting me. I like you and this is only a discussion, after all. I doubt if we'll change anything. But I will say that this whole issue is not complex. Most people understand that printing money is no good because inflation reduce the purchasing power of their dollars. Most people know that raising taxes reduces the money available to them to buy stuff. Most people know that deficit spending and debt has to be paid back at some point and this will hurt. Most people know that subsidies and deals the government makes with certain industries is unfair to the average American as well as to the industries not favored by the government. You don't have to be an economic wizard or a teenager or Adam Smith to understand these things.
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.
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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
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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.
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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
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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."
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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.
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Killjoy! ;D
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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.
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...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
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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
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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.
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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
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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.
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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.
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...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 (http://www.amazon.com/Saving-Capitalism-Capitalists-Unleashing-Opportunity/dp/0691121281)
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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.... :)
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Another ad hominem attack.
Do you really think that presenting solid and verifiable facts that dispute your argument is ad hominem? Wow.
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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.
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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.
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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