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Myths of Austerity: recommended reading
Myths of Austerity: recommended reading (post #153797)
SteveSchoene on Fri, 07/02/2010 - 10:15
Paul Krugman, Nobel prize winner in Economics, has published an Op Ed piece in the NY Times
http://www.nytimes.com/2010/07/02/opinion/02krugman.html?hp
that should be must reading for anyone interested in economic policy choices in these troubled times. All too often do we here the Herbert Hoover policy solutions that we should tighten our belts so that the "confidence fairy" will magically transform businessmen into speculative spenders. It's time for another round of stimulous spending.
Test your finish on scrap, FIRST, or risk having to scrap your finish.
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Nobel prize winners (post #153797, reply #1 of 31)
There are two other recent undeserving Nobel prize winners. And I don't like them either !!
Work Safe, Count to 10 when your done for the day !!
Bruce S.
With which of Krugman's (post #153797, reply #2 of 31)
With which of Krugman's academic writings do you disagree?
But he is very mainstream in the arguments advanced in the article. With plenty of excess capacity, any government spending will further the process of stimulating the economcy and reducing unemployment. Government spending is contracting rather dramatically in the coming fiscal year as state and local goverments reduce spending even more. I would strongly urge another substantial program, at the very least pitched so teachers and policemen won't be laid off, The time to worry about the federal deficits is when we approach fuller capacity.
Test your finish on scrap, FIRST, or risk having to scrap your finish.
Keynesians (post #153797, reply #4 of 31)
With which of Krugman's academic writings do you disagree?>
I think that when the government acts on a macroeconomy in an increasingly large way you raise the standard of living without increasing productivity. Or, better said, you introduce a very artificial element into productivity gains. This is bad in several different ways, not the least of which is that it creates long term inflationary pressures and less than full employment and optimum growth. I think this was Greenspan's central theme for years. When people get finished hammering him in the face for "causing" the financial crisis by not speaking out against the deregulation of the banking industry well enough, and being a convenient scapegoat, maybe they will realize what he was saying for many years. Deficit spending is not the way to go year after year.
FWIW, there are some specific parts, isolated out of context from the larger theme, of K's editorial that I agree with.
Location: Western Montana
Sir.. I lost most of my saved (post #153797, reply #3 of 31)
Sir.. I lost most of my saved cash many years ago. I think it was just before the attack on the twin towers... I lost most of my savings in an instant.. Most of my savings in my in a 401. Fedility had my cash and I do NOT blame them. I thing think at times the next day and nobody can be to blame except the rich folks that could care less about us little folks. The times we have to face.. The rich get richer and the poor get poorer!
Have a great day.. Life is wonderful even if you are having a bad day!
Reminds me of my wife (post #153797, reply #5 of 31)
His thoughts reminds me of the wife who says. What do you mean I'm broke I've still go checks! People don't succeed because of government but in spite of it.
In order for the government to spend they have to go get the money from somewhere that somewhere is US! If they take it out of the supply then you and I have less so we don't have more to spend.
The only thing the government can do is print money and you will have the spector of inflation, but in this time people are scared to death of what the current socialist group are doing (nationalizing this and that) so that folks are holding on to what they have.
The whole stimulus package was a joke, the states used that money to stay afloat and and kick the can down the road. let me ask you something when you loose your job and you have no money, and you start using your credit cards to pay the bills at some point they will cut you off and you will go under. We can't keep going this way. Flat out you cannot spend more than you make or you will eventually go broke! You want to stimulate the economy CUT SPENDING and cut taxes folks pay and put money directly in their pockets! Look to history . Spending did not help in the 30's and the depression did not end till the advent of WWII. Kennedy cut taxes growth, Regan cut growth. The poilicy's of this administration will only drag out this reseccion if it does not become a full blown depression. In the states manufacturing is dissapearing only in part due to wages, another large component is opressive taxes . Every body should have seen it coming with the Joe the plumber (I'm going to spread the wealth comments). I think now people are starting to see the emperor has no cloths. The whole rich get richer and the poorer get poorer argument is BS. A rising tide lifts all ships. We will recover but this is going to be long and painful.
...For that old machine lovers: http://vintagemachinery.org/home.aspx
Spending did help in the (post #153797, reply #14 of 31)
Spending did help in the great depression, though not enough of it was done. The reason preparation for WWII ended the depression was that there was massive government spending, financed by deficit spending. It was the clear example of how spending works.
Cutting spending in the current situation would be precisely, absolutely the wrong thing to do. IF spending were cut to match the tax cuts the economy would contract--unemployment would increase.
It is absolutely true, beyond question, that in the last few decades the rich have gotten richer and the poor poorer. The easiest place to see this is in CEO salaries. In the 70's the typical CEO might earn 25 times the lowest paid worker in the company, today it could easily be 1000 times or more.
Stimulous spending, which bailed out states to a large degree, did help keep unemployment from soaring more than it did. But this spending is running out as the states change fiscal years, lay-offs loom. Then, teachers and policemen stop spending, then the merchants that sell to them also sell less, and the downward spiral is accelerated.
Of course, because the national government can print money it can ALWAYS pay it's national debt. Will that printing of money cause inflation? Despite easy money, there is no spector of inflation. Only if the economy is approaching full employment of both labor and capital. Most healthy corporations also have essentially perpetual debt. It never gets paid off, and is never expected to be paid off. It's only a problem for individuals because they eventually die.
Just exactly what has been nationalized--GM is one case. That's almost certainly going to be a very temporary situation. No one in government, except perhaps Bernie Sanders, is advocating socialism. The bail out of banks, etc, was largely a matter of government lending. That's NOT a step toward socialism.
Test your finish on scrap, FIRST, or risk having to scrap your finish.
"socialism" (post #153797, reply #6 of 31)
I think you have to dissect all the political wrangling out of an analysis of the state of the economy in order to understand it. As soon as you hear the word "socialism" you know its stuff from the right wing hate-Obama spin machine. Both sides of the political spectrum cherry-pick what they think are factoids about the economy and throw them out there to try to make political points.
The issue is what is the right amount of government spending in our economy. Are the stimulus package and various bailout measures inherently bad? No. Obviously they caused the recession to be less severe and caused less pain in the short term. Do you want to operate like that all the time and have the government be a big player in the economy in perpetuity? My opinion is no. Maybe you should ask the government of Japan how it's working for them. Get the economy growing again at a manageable rate, get inflation at an acceptable 2 percent rate that can be controlled with money supply by the Federal Reserve Bank and then start approaching full employment again.
Don't spend too much or too little to make that happen, and then start planning for the long term. Deficit spending will put long term inflationary pressure on the economy and could cause the next recession to be worse. But people forget that when the government runs a surplus, it is almost just as bad for the economy as a deficit.
Random thoughts, my 2 cents worth - i'm sure this discussion will now devolve into a political brou-ha-ha,.....
Location: Western Montana
Bones, In part you wrote, (post #153797, reply #23 of 31)
Bones,
In part you wrote, "...People don't succeed because of government but in spite of it....The only thing the government can do is print money and you will have the spector of inflation..."
I don't think that's really true, Bones. Government can help people succeed. It can regulate and enforce regulations on industries that tend to maximize short term gain at the expense of the long term. You can look at the mortgage industry and find that the FBI reports that the collapse was due to wide spread fraud and around 80% of the fraud was by the financial institutions. Or you can look at the stock market and discover that on any given day 37.5% of the shares sold didn't exist and were never delivered to the purchasing portfolio. The whole system had been basically deregulated and those who invested were less than successful because of lack of government oversight and enforcement of the law. Think about that, 37.5% of the total shares traded on Wall Street for years didn't even exist even though investors paid for them. Just like the Savings and Loan Scandal that resulted from deregulation, something has to give when that kind of volume is stolen through fraud.
I probably should give you a link so you can verify what I'm saying so here it is and it's not from some left-wing organization, it's from the Cato Institute which is about as pro-big business conservative as think tanks come:
http://www.cato.org/pubs/regulation/regv...
BTW, can you give an example of something that's been nationalized? Can you show me something the Obama administration has done that's more left-wing than the stands and policies of Nixon when he was President? I don't think you can. Socialistic policies don't concern me much, I don't see them going much of anywhere. What I find incredibly terrifying is that we no longer have a useful term to identify fascism. The terms fascist and fascism have been taken off the table because they've become just inflammitory insults. This makes it pretty difficult to talk about what I see as the greatest real threat to our Constitutional form of Government.
http://www.rense.com/general37/fascism.htm
The Economy (post #153797, reply #7 of 31)
'Government doesn't create resources - it redistributes them."
Frosty
In a nutshell (post #153797, reply #8 of 31)
That's it, in a nutshell, Frosty. The government doesn't create,... Thus the productivity of the economy is artificially inflated and somewhere along down the line prices have to rise.
The government has to be there, in a capitalist economy of a entrepreneurial, democratic society, but HOW MUCH does the government have to be there? This is a question that people were trying to answer when I was in college in 1979, and it still ain't changed.
Someone else post some stuff - I feel like I'm talking too much and will not be tempted to post again.
Location: Western Montana
To say government doesn't (post #153797, reply #9 of 31)
To say government doesn't create resources is simply false
A teacher paid for by goverernment is just as much a teacher as if paid for by a corporation. And, when the government pays anyone, either for work they perform, or for goods they manufacture, the income received is spent (mostly) with that spending providing income for other businesses, in the economy. Spending d multiplied in the economy, and ony the first cycle of that multiplication is government spending, the rest is likely to be private. That demand for private goods provides the demand that encourages private business to invest and hire, putting more resources to work.
Similarly, when government builds a road, it helps move goods from maker to market, just the same as if it were private. It is an infastructure resource.
Certainly, the private sector does many functions better than government would do, but that's not always true. Police functions and other law, and contract, enforcement, are good examples.
Test your finish on scrap, FIRST, or risk having to scrap your finish.
My middle daughter has a (post #153797, reply #11 of 31)
My middle daughter has a Master in child education.. She was never allowed to work.. She was over qualified for a teacher of young children.. She now teaches at a catholic school... She always has many tears for her children at going to first grade....
My woman child loves little boys and girls.. She could care less if she she made any money to be their friend...
Have a great day.. Life is wonderful even if you are having a bad day!
It doesn't compete in the (post #153797, reply #12 of 31)
It doesn't compete in the marketplace. It's income is mandated, not earned by the nexus of supply and demand. Though it is necessary and essential, it cannot help but introduce an artificial element into productivity of the economy as a whole.
Location: Western Montana
Yes, government can distort (post #153797, reply #13 of 31)
Yes, government can distort markets, and can therefore reduce productivity. But, it cannot be said that ALL government activity reduces productivity.
But, it is equally true that markets can also fail, and also lead to inefficiency. The tragedy of the commons--such as a fishery that could be seriously depleted, without limitations imposed by government, is one example. Air pollution results from similar market failures. If polluters were forced to buy the right to pollute, or could breathers be forced to pay for clean air, markets might provide "efficient" amounts of pollution. But it seems necessary that there is a role for government in controlling pollution. Similarly, does it make sense for there to be an economic market for legal justice?
Unfettered markets can lead to monopoly, which can't be shown to lead to efficiency.
Test your finish on scrap, FIRST, or risk having to scrap your finish.
The False Gods of Economica and Their Charlatan Priests (post #153797, reply #20 of 31)
Ed, Steve & All,
Discussions like this belong in the C19th when learned folk believed every process could be reduced to a science containing a set of clear laws, the associated truths and a set of lever-clad technologies of control. It has been some decades since Mandelbrot and others demonstrated that many real-world systems of the complex sort (weather, markets, polities, societies large & small) are not amenable to a reductionist analysis yielding such laws and certainties. Economics taught as a science or implemented as some kind of expert-led social-engineering project (private or government) is a sham. See:
http://www.fooledbyrandomness.com/tenprinciples.pdf
All this "economics 101" (as Ed likes to call it) is no more meaningful than astrological analysis of the future, in arriving at recommended behaviours for people entering it.
****
On top of this y'all suffer from "accountancy blindness" - that set of mental "givens" that assumes every problem and solution may be reduced not just to an economic matter but to one employing only the current & dominant economic model of global capitalism. Despite what Ed thinks (he is no historian) the assumptions and mechanisms of capitalism are very new in human history; usury really was a sin once, so not countenanced by the various civilisations that eventually gave rise to the whole profit-making machinery of today. (Have a look at the economic innovations of the Medicis in medieval Italy for the first spasms presaging the birth of modern capitalism).
Here is a quote from a fine American observer, Christopher Lasch, of the various political and social philosophies/theories washing through American life, from the early days of its founding until very recently. I doubt it will knock off those accountancy-blinkers you have on but you never know:
". . . individuals cannot learn to speak for themselves at all, much less come to an intelligent understanding of their happiness and wellbeing, in a world in which there are no values except those of the market. . . . the market tends to universalize itself. It does not easily coexist with institutions that operate according to principles that are antithetical to itself: schools and universities, newspapers and magazines, charities, families. Sooner or later the market tends to absorb them all. It puts an almost irresistable presure on every activity to justify itself in the only terms it recognizes: to become a business proposition, to pay its own way, to show black ink on the bottom line. It turns news into entertainment, scholarship into professional careerism, social work into the scientific management of poverty. Inexorably it remodels every institution in its own image.
Christopher Lasch "Revolt of the Elites"
Lataxe, who doesn't have The Answer either .
The "Fooled by Randomness" (post #153797, reply #22 of 31)
The "Fooled by Randomness" dicta are a nice set of 20-20 hindsight. There were plenty of folks, particularly in the Academy, that were warning of the potential instability of the financial markets. The principals taught in mainstream Economics 101 (or more precisely Econ 501 and 502) would have done quite well at forestalling much of the recent economic crisis. But notice for the most powerful actors, skewed incentives, and an override of economic principles by ideology that benefits particular classes (That word is for Lataxe, American's translate to "groups") or by an adherence to public opinion polls that consigns economic policy to the lowest common denominator. You really can't indict the discipline of economics because policy makers ignored it in many respects. Yes economics is pursued as a science, but that is far from meaning that economists don’t understand that it isn’t mechanistically controllable. And, throwing out the science as imperfect leaves you with what?
I agree that understanding broader contexts than the current paradigm is desirable, (I was trained as an economic historian) ” and George Santayana may be right that “Those who cannot remember the past are condemned to repeatit.” but frankly, the origins of banking innovations of Medici and the goldsmiths of renaissance Italy, aren’t really of much interest to understanding what led to the fall of Lehman and the crisis that then unfolded, nor could any analogies be seen in sufficiently “real time”to be a guide to policy.
Yes, there was a time, some of it not all that long ago, where economists practiced their arts with mathematics rather similar to fluid mechanics, but I think you would be surprised to look at the complexity and uncertainty that are now part of economic analysis. Only the ideologically motivated practitioners have confident answers purely within their models, the mainstream still considers people, politics, and circumstances.
By the way, usury may very well have been strongly held as a sin, but regardless, borrowing and lending went on, but despite Islamic banking, interest is really interest whatever name you call it.
Test your finish on scrap, FIRST, or risk having to scrap your finish.
Well I was going to (post #153797, reply #24 of 31)
Well I was going to gracefully withdraw from this discussion until I saw my name mentioned several times.
Lataxe, if a person lives in a world where there is a (mostly) free market economy, then denying the existence of the marketplace doesn't really help you to understand it.
Should the Nobel Prize in Economics simply be awarded randomly, then, sort of like a lottery winning?
My girlfriend and I were discussing this last night - supply and demand is always changing as you move forward through time. (She was asking the rhetorical question of why a capitalist economy has to grow). Every time a new baby is born, there is a new consumer and the demand curve changes. When the demand curve changes, the supply curve will change because of the motive to maximize profit. This is just the world we live in - it is neither good nor bad.
I'm no historian, as you would point out, but I would say that there was a supply and demand curve that caused those amphoras of olive oil and wine to be exported all over the Mediterranean by the ancient Greeks. The fact that they figured out that there was a demand for that stuff and they could meet that demand, is something that allowed their culture to be wealthy, and, along with language, bound together by a common identity.
Now you can dance around on your elfin fairy toes and say, "But I don't like that world - I want the government to decide how the demand and supply curves meet so that there are no corporations and everything in my little nanny state world is just exactly like my little back garden, only with the needs of everyone met in some little faery-like Hobbitton where there are no classes - but it ain't gonna happen. Not in the USA and not in the real world.
For better or worse, we live in a (mostly) free market economy, so you might as well try to understand it. You can lose yourself in academic musings about randomness and chance and Mandelbrot fractal spray patterns about weather, economics, whatever - wonderful, abstracted theories about why there should be no theories - and it doesn't tell you a damn thing about where the hurricane's going to hit.
My own opinion is that a free market economy is the only kind of economic system that would work for us. I lived two years in Australia and two years in Japan and I believe that Americans are less conformist than either Australians or Japanese peoples. Americans are a ferociously independent people. When you start trying to take things away from them and tell them what to do, they really don't take very well to that. If you don't believe me, suppose you wander out to the wilds of say, Wyoming, or some place and go up to any available rancher and start taking their property away and telling them what to do. Lemme know how that works out for you. It's kind of vogue for people around the world to bad-mouth Americans and point out their flaws, and that tradition goes back a couple hundred years at least, particularly in Europe, but given the ferociously independent nature of American people and given the way our Constitution is set up - the only thing that will work for us is a free market economy.
So you might as well try to understand it.
Or bury you head in the sand.
BTW, my girlfriend is into Nasim Taleb's books in a big way. She uses the argument that he made a fortune on Wall Street to "prove" that his theories (many not tested) are all letter-perfect and correct. There's a logical fallacy in there, but sometimes it is more politic not to point it out to her. I do point out that there have been a lot of charlatans that have made fortunes on Wall Street,, basically since the first day it was open for business - the name "Madoff" pops into recent memory, somehow.
The other guy you quoted - he's saying that... everything looks like a market because,...it's a market? Okay. Yeah, and everything looks like daylight because the sun is shining. Okay...I like the way he says (if we don't see things his way, individuals cannot) "come to an intelligent understanding of their happiness and wellbeing." What the heck does that mean? More faeryland, Lataxe. Say hello to Frodo for me.
Myself, I'll settle for the tried and true method of learning things about the world that we live in - gather evidence, produce theorems based on a rational analysis of the evidence, select the most likely ones, test them rigorously, analyze the results. I propose that this works better than the academic version of "shooting from the hip."
EH
Location: Western Montana
Blinded by Glitter (post #153797, reply #30 of 31)
Ed, you pontificate
:My girlfriend and I were discussing this last night - supply and demand is always changing as you move forward through time. (S "he was asking the rhetorical question of why a capitalist economy has to grow). Every time a new baby is born, there is a new consumer and the demand curve changes. When the demand curve changes, the supply curve will change because of the motive to maximize profit. This is just the world we live in - it is neither good nor bad".
"My own opinion is that a free market economy is the only kind of economic system that would work for us".
This is just another blinker Ed - you haven't seen that the simple law of supply and demand is now driven not by needs that form a limited and sustainable lifestyle but by modern capitalism's insatiable desire for ever-more sales, ever-greater profits, at an ever-increasing rate. The global market is no longer driven by the reasonable desire to acquire means to live a productive life oneself but by an addictive consumerism infecting people who are passive to the point of laziness, wanting only to satisfy their "need" for novelty and luxury. Not only does this subvert any and every kind of morality, responsibility and community, it also contains many self-destruct mechanisms.
The blind-drive for immediate profit means that the mass media persuades people to want all kinds of useless stuff but also denies them the means to buy it, since the accountants up at the top of Corporate HQ are busy cutting every cost, including that of wages to employees, who are unfortunately the very consumers who they want to but their dross!
As Larry mentions, the best way to cut costs and maximize profit is to sell unreal items in the form of "finacial instruments" that are all promise and zero substance. Wall Street and cohorts own the world because they have persuded us dupes to give them all our created value (the wages of real production) in return for false promises and a utopian dream of their own luxury lifestyle - an impossible and also very undesirable lifestyle, since it uses up resources beyond sustainability and substitutes rights for duties.
Manufacturing is now little concerned with producing goods of true value (of genuine use to the buyer) and intent on producing glittery toys with a lifespan (physical or psychological) equal to the ever increasing frequency of the fashion cycle. New! Improved!! (Not). Financial institutions extract even more money from the "consumers" in exchange for even less value (often nothing but a vast debt). Islands of old-fashioned production (such as the better woodworking tools) are few and far between.
And then there is the rather pressing matter of a burgeoning population competing for an ever-dwindling share of the Earth's resources, used up at an ever-increasing rate by that same global market place to make mostly rubbish.
******
So, I fear that your inability to imagine something other than a free market economy will sooner or later suffer an enlightenment. The fraction of 1% of the population that now own 99% of the wealth and infrastructure will soon decide that all these penniless peasants are no longer of use since they lack the means to consume. What then, do you think................? Personally I dread a new form of totalitarianism wrought by this elite, who will employ any and every method of science, industry and war to create new means of suppression aimed at the threatening billions of disposessed.
***
But the future (as Mr Taleb notes) is far from predictable in such volatile, complex and connected times. Perhaps we may hope (without merely thinking wishfully) for a revolt against consumerism and the obscene concentrations of wealth & power? Perhaps even we woodworkers and other craft-types might offer one small element of a more active, more productive yet less wastefull lifestyle? Well, perhaps I am wishfully thinking after all.
Whatever occurs, we really kid ourselves if we think we have any meaningful control over it. We don't "change the culture" but rather are changed and formed by it - the ever-evolving complex of human genes, ideas and emergent social configurations that have a life of their own. As a republican (small r) I find this prospect both frightening and elating, despite the possible doom. After all, one man's doom is another's opportunity to fill the new niche in the human ecology, inclusive of a bit of striving. It's better than sitting in front of the tele in your reclinomatic, getting your mind filled with consumer "needs" whilst eating polystyrene pizza and drinking yeller water with cheap alcohol in it.
Lataxe, trying ever more to leave the stage of the consumer spectacle.
You're predictable (post #153797, reply #31 of 31)
Lataxe.
All your thought is driven by this wanna-be-hippy pseudo academic school of thinkers, appealing to the 'sky is falling' fringe element. I know the type very well.
You have to raise spectres and visions and ghosts in order to drive your arguments forward - evil capitalism with ever-increasing need for profits, lazy consumers with immediate gratification motivations, totalitarianism,...etc - all mentioned in your post.
I don't have time to reply to it point by point, besides we've been over it before. I'd rather look at the economy with as clear as possible a non-agenda-driven focus when I read the NYT and WSJ in the morning.
I'd be interested to understand how you explain the role of successful entrepreneurs in your world-view, but I really do not have time today or this week to do the discussion justice. In your hysterical fear that 1 % of the people hold 99 % of the wealth and want to establish totalitarianism (something I served 20 years in the Armed Services because I believed was a bad idea), I'd be interested to see how you square that with Stanley and Danko's study of millionaire's in America (The Millionaire Next Door) in which they discovered that about 90 per cent of the millionaires in America are first generation, self-made, and that about 75 percent of them are small business owners who do not fit any ideas about a lavish lifestyle. But I don't have time. It is one of those weeks where I'm saying it's Tuesday already! How did Monday slip by? There will be no sitting in front of the tele eating polystyrene pizza and drinking cheap beer for me this week.
Location: Western Montana
we should tighten our belts (post #153797, reply #10 of 31)
we should tighten our belts so that the "confidence fairy" will magically transform businessmen into speculative spenders. It's time for another round of stimulous spending. ...
I would be glad to join the "confidence fairy" IF I had some money to spend on anything other than monthly bills!
Have a great day.. Life is wonderful even if you are having a bad day!
It's no mystery why (post #153797, reply #15 of 31)
It's no mystery why businesses aren't going out and spending a lot on building new capital projects. It's hardly necessary to bring in "confidence" or "fear of government"--its just simple, you don't build a new factory when your existing factories are running at substantially less than capacity.
Test your finish on scrap, FIRST, or risk having to scrap your finish.
I prefer discussing woodworking, but (post #153797, reply #16 of 31)
Have you tried to get a business loan lately? The economy is being held back to some degree by the banks fear of lending. I know of at least two business owners who are doing well and could do even better if they could find financing for their projects. These are substantial people with good credit and a proven ability to earn money and the banks won't lend them any.
I know of another developer who had his loan called halfway through his project which forced him to abandon his project thus causing him to lose several hundred thousand dollars.
The government can help revive the economy by providing incentive for capitalism in the form of tax cuts and investment tax credits. They should also provide tax credits to employers for hiring people off the unemployment rolls. The best way to stimulate the economy is to allow people to keep more of what they earn.
The current form of government stimulus money is a total waste. It does nothing to buoy capitalists and small business ventures. Socialism is an unsustainable business model. America needs to be the place where one can achieve the American Dream by having a good idea, working hard and having a good business plan. We must have incentive for success here in America again, otherwise all the sharp minds will go elsewhere. Businesses must be free to fail also.
America is in decline because it has turned it's back on capitalism, it's plainly obvious. All these books on economic theory just keep people from seeing the forest for for the trees. We all might be better served studying human nature and common sense.
Just my HO, Bret
I'm not sure where this idea (post #153797, reply #17 of 31)
I'm not sure where this idea that American, or the current Administration, has turned it's back on capitalism is derived. I see very little evidence of it, about the only case being government ownership of GM as a result of funding the company's bankruptcy.
That's an exception, not likely to be repeated. I can't identify a trend toward more direct government ownership of production. THAT's what socialism means. Government OWNERSHIP of the means of production. Not government subsidies, not regulation. The new health care program doesn't increase government ownership of anything. Neither does the financial regulations that are proposed, which make it easier for banks to fail, but fail in ways that don't take down the rest of the financial system. The word socialism is bandied about by commentators who choose to use to monger fear from folks who don't understand much about the economy and how it's parts are interrelated.
Economists do study people and human nature. They do base their work on theory, but probably the vast majority of economists spend their time TESTING whether, and underwhat conditions, the theories work. But, they do that systematically, with a heavy emphasis on econometrics, which is the science of applying statistical analysis to the testing of theories. Testing theories can' be done by just applying an ideological filter. What passes for common sense often turns out to be false when rigorously subjected to real testing with data.
Test your finish on scrap, FIRST, or risk having to scrap your finish.
Testing their economic theories on us? (post #153797, reply #18 of 31)
IMHO the economists they have been hiring lately in Washington just have it wrong.
Government hand outs just creates lazy people. Our entitlement mentality has made us lazy.
Knowing there is reward for sucess and hard work causes people to try harder and want to succeed.
Forget I ever mentioned the word "Socialism". People get all wierd when that word is used.
People used to flock to America for oportunity. Now I think they are after a hand-out.
But what do I know? I've not even been to college,
Bret
You could surrender your (post #153797, reply #19 of 31)
You could surrender your Social Security payments back to the government after you receive them. I suppose you could also pay for health care after 65 instead of using Medicare, though you couldn’t do it with a assistance of private health insurance, which isn’t available for folks over 65 except as a supplement to Medicare. Those are by far and away the largest of the entitlement programs.
There are undoubtedly some who would rather collect a fraction of what they had been earning, before they were fired for other than “cause”, by collecting unemployment payments. But with unemployment rates over 9%, there must be a very large number of folks who just can’t find work.
By not extending unemployment compensation, foreclosures increase, and private demand for goods decrease. That’s a tradeoff—supporting some loafers as a side effect of helping many others that I will gladly accept.
I strongly expect that the immigrants who come to the US do so for opportunity to work, not for our entitlements, which after all are among the least generous of all the developed nations. This is particularly true for undocumented workers, who just can’t collect many of our entitlement benefits. They may pay the taxes, but can’t file. Workers off the books get even less, since the benefit from not paying soc. Security tax, is almost certainly offset by the lower wage imposed by employers.
Test your finish on scrap, FIRST, or risk having to scrap your finish.
It's only an entitlement if (post #153797, reply #21 of 31)
It's only an entitlement if you expect to receive Social Security and Medicare without having paid into the system for years. Although I believe that SS is largely a government run Ponzi scheme and doomed to eventual failure unless the economy becomes robust again, those of us that have paid in for years certainly deserve to collect our due.
Why would you assume that I am against social programs? I voiced my support of capitalism and I'm immediately stereotyped. I believe we have a social obligation to care for the less fortunate in our society and on a personal basis.
Also in our state we pay dearly for our unemployment insurance and one should expect to be compensated if unemployed. What you failed to understand was that I felt we need incentives to get people re-employed by offering tax credits to employers. I once received tax credit for hiring Vietnam refugees, I got excellent hard working people and a nice tax reduction and got some people off welfare. A win win win situation as I saw it.
I strongly disagree with your statement that we are among the least generous nations. Who contributes more? The US has made it's share of mistakes but we are better than most. I don't understand this guilt trip and international apologizing that many Americans seem to be adopting.
I remain a compassionate, unapologetic capitalist with no qualifications to comment on the economy other than life experience.
Bret
No entitlements ?? (post #153797, reply #25 of 31)
What do you call free ER & Hospital stays ? What about, Free day care and pre school ? Free food banks ? No punishment for being Illeagal ( sorry undocumented ) Profiling exemption ??
What is the cost of Illeagals ? How many Billions of $$ or is it into the Trillions now??
Work Safe, Count to 10 when your done for the day !!
Bruce S.
Offsetting the costs you (post #153797, reply #26 of 31)
Offsetting the costs you mention is a great deal of tax collected but no social security or medicare to be received. Many are very hardworking workers who are often underpaid because of their status. I believe you would find that on balance the undocumented workers are net benefits not drags. Certainly the massive waves of immigration in earlier decades, with many people arriving with nothing but a willingness to work hard contributed to the growth of the American economy. Of course, low wage workers from among the families of earlier emigrants may receive relatively lower wages from the increased supply of labor, but the consumers of the products or services produced or performed by undocumented workers benefit from lower prices.
Being in this country without the proper documents is not a crime, it is a status offense, punishible largely by deportation, not fine or imprisonment. If you are looking for criminals here, look to employers who fail to report or pay taxes of undocumented workers.
Test your finish on scrap, FIRST, or risk having to scrap your finish.
Steve, please! (post #153797, reply #27 of 31)
Maybe we should just get back to discussing woodworking.
You essentially just called all us employers a bunch of crooks.
BTW, not all illeagals are approaching sainthood.
Whatcha buildin in the shop lately?
Bret
Oh no, not all, or even many (post #153797, reply #28 of 31)
Oh no, not all, or even many employers overtly exploit undocumented workers. But some do.
Similarly, not all, or even many, undocumented workers are criminals. But some are. Incidentally, the index of violent and property crimes in Phoenix AZ has declined substantially in the last decade, and particularly in 2009.
http://phoenix.gov/police/ucrhistpart1v.pdf
I'm preparing to tile a shower, install a bath vanity and also a wet bar in my lower level. Also sprucing up an IPE deck, and trying to get around to a furniture repair/restoration project or two for relatives.
Test your finish on scrap, FIRST, or risk having to scrap your finish.