Can we have a civil, thoughtful discussion on this?

Discussion in 'Economics & Trade' started by Kode, Jan 11, 2017.

  1. Econ4Every1

    Econ4Every1 Well-Known Member

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    It either makes no sense, or you are unwilling or unable to understand it.
     
  2. Econ4Every1

    Econ4Every1 Well-Known Member

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    I thought I made that clear. If my kids refuse to do anything, I take their privileges away.

    Sure, I provide my kids a basic minimum. They have food to eat, medical care, a roof over their heads, and education. These are things I give them no matter what. I'm just not sure how this response has anything to do with what I said.
     
  3. AFM

    AFM Well-Known Member Past Donor

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    It makes no sense. Perhaps someone else can explain it ??
     
  4. a better world

    a better world Well-Known Member

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    That's because government - far from believing that people choose to live in poverty - recognises that most people prefer to work for a living if they are able, but in an
    environment of high under-employment and below-poverty-level minimum wages, people become demoralised, and we see this in generational
    unemployment and ghetto formation. (though in a sense poverty is punishment, though not directly ordered; see my comments on the tension between fairness and selfishness below)

    (Dad's dollars are in fact an above poverty-level incentive - children can obtain 'privileges' - by performing household tasks, where the basics are guaranteed
    by the parents. The Dad's dollars merely incentivise the real 'wealth' creation, eg, by helping with household chores)

    I mentioned earlier that humans, unlike animals, are aware (conscious) of 'fairness'. But of course, like animals, they are also instinctively (or unconsciously) 'selfish'
    ie no-one automatically likes sharing their wealth with others (apart from the sharing required by parental responsibility), otherwise known as the instinct for self-preservation.

    So I suppose this contest between (conscious) awareness of 'fairness' v. (unconscious) selfishness that exists in each of us, is the source of the left-right divide -
    people tend to identify with one side or the other, for infinitely variiable psychological and environmental reasons.

    Note that in the USSR there was no need of welfare because everyone was 'employed' , and the basics were guaranteed by the state.
    Of course as an economic system it failed to compete with the West; but that doesn't alter the fact that a combination of the two economic
    systems is required, as a dispassionate look at the current almost ubiquitous economic and political dysfunction will confirm.
    Marx, and Keynes with his Bankor and "clearing union' mechanisms, didn't dream up their ideas in a vacuum.
     
    Last edited: Apr 13, 2017
  5. Iconoclast2

    Iconoclast2 Member Past Donor

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    Economics has been no more credible in demonstrating a model that matches experience than most religions. The first understanding of how we got here and why that is happened in reading Debunking Economics by Steve Keen 2011.
     
  6. Econ4Every1

    Econ4Every1 Well-Known Member

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    As a statement out of any context that's 100% true. I hope I never implied that wasn't

    And you know why we don't barter anymore? Because it's insanely inefficient and if a nation we adopted barter instead of what we have now, our economy and our global influence would be a tiny fraction of what it is now.

    History bears out that ever time a world power has gone to war, that metalism is abandoned for fiat because fiat allows for the greatest use of the nation's resources. When combined with a tax system, it provides the "drain" necessary to prevent the problems of inflation experiences before the 20th century. Which is why the post-WWII era, and era where the US created and spent more money into the economy than any other 4-year period, at least since the civil war and the 20 years that followed were some of the best and longest sustained in the history of the nation.
     
    Last edited: Apr 13, 2017
  7. Econ4Every1

    Econ4Every1 Well-Known Member

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    I have and nothing I've said, that I'm aware of, conflicts with what Keen says.
     
    Last edited: Apr 13, 2017
  8. AFM

    AFM Well-Known Member Past Donor

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    Of course barter is inefficient. That is why money was invented.
     
  9. bringiton

    bringiton Well-Known Member

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    I can try. Privilege (from the Latin for "private law") is a legal entitlement to benefit from the abrogation of others' rights. The most important ones are land titles, commercial bank licenses, IP monopolies, professional association and labor union monopolies, and broadcast spectrum allocations, roughly in that order.
    All right. You are skeptical that the concept has merit because it has been deliberately removed from social science to prevent people from thinking about it.
    I welcome your skepticism -- as long as it is not applied only to what I say, but impartially to all. As Henry George put it, "In nothing trust to me." Is it OK if I put your honesty to the test? Because dishonesty is the only way to prevent yourself from understanding what I explain to you.
     
  10. bringiton

    bringiton Well-Known Member

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    Venezuela's economic problem is socialism, not the price of oil. Oil revenue just enabled the socialists to keep their card house standing a little longer. Capitalism may not offer the bottom 60% -- or the bottom 90% -- much, but an opportunity to earn an honest living is better than socialism even if most of what you earn is stolen by rich, greedy, privileged parasites.
     
  11. bringiton

    bringiton Well-Known Member

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    You don't need any skill to get wealthy by being privileged. It happens automatically, as long as you aren't stupid. "To turn $100 into $200 is work. To turn $100 million into $200 million is inevitable." -- Samuel Bronfman, Canadian real estate billionaire.
    They need a better metaphor, and here it is:

    The reason you can't get ahead is that you are on a treadmill. The treadmill you toil on powers the escalator that the privileged ride up at their leisure.
     
  12. bringiton

    bringiton Well-Known Member

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    "Own property"? How do they happen to own property? The great majority of property by value consists of privileges created and enforced by none other than (drum roll) government.
    Garbage. Government has forcibly dispossessed those who own nothing of their rights to liberty.
    Garbage. Government has taken away their liberty rights to earn income and contribute to sustaining their own existence, and given those rights to the privileged, especially landowners.
     
  13. Ndividual

    Ndividual Well-Known Member

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    Essentially you are the governing force responsible for your 'kids'. I assume you'd have no problem if someone else provided your kids you mean to punish for not doing anything, with the privileges you're denying them without your consent?


    Then you view government as being a pseudo-Dad?
     
  14. Ndividual

    Ndividual Well-Known Member

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    Is that a verifiable fact or an assertion?

    I've known a number of individuals who would not accept work simply because they received adequate care by government, and some who would only work until they earned the maximum allowed without reducing their government benefits.
     
  15. a better world

    a better world Well-Known Member

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    It's simply an incentive system, in which poverty does not exist, and in which 'wealth' - earned by performance of household chores - result in
    possession of a transferable medium - make-out money {Dad's dollars which can be converted to real dollars by Dad - to enable purchase
    of goodies over and above the necessities of life.
    Labour that achieves a desirable outcome is wealth, which is why unemployment is an artificial effect of an insufficient economic modeI.

    Meanwhile In the real world your free-market, supply side model is unravelling:

    http://evonomics.com/economists-stop-defending-milton-friedmans-pseudo-science/

    As a result of the centrality of Friedman’s
    understanding of science within the discipline
    of economics, the discipline has become
    dominated by a nineteenth century, Walrasian
    free-market ideological view of reality that,
    at its core, consists of a logically consistent
    and mathematically elegant paradigm of market
    behavior that describes how an ideal system of
    human interaction in a hypothetical free-market
    society is supposed to work, as well as the
    prerequisites for such a system to actually work,

    that is totally out of touch with reality. A paradigm
    in which the assumptions on which its logical
    consistency depends—the most important being
    that no economic actor has the power to directly
    influence market prices, all market participants
    have perfect information as to the determination
    of market prices, that there are no external costs
    or benefits associated with the production or
    consumption of goods, and that people behave
    rationally as the term “rationally” is defined by
    economists—are not simply unrealistic and
    contradicted by empirical evidence but are,
    in fact,
    impossible to achieve in the real world.
    [Blackford (
    2013)]
     
    Last edited: Apr 14, 2017
  16. a better world

    a better world Well-Known Member

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    And yet some people live with demoralising poverty and crime, so the care provided by government in their case is obviously inadequate.

    Basically you are asserting there are insufficient resources to supply the basics for everyone at an above poverty level existence.

    I say your economic model is inadequate, given that in fact everyone is capable of participating, regardless of skill and creativity potential.
     
    Last edited: Apr 14, 2017
  17. AFM

    AFM Well-Known Member Past Donor

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    The claim was that taxation creates a monetary system. That's absurd.

    Supply side has worked very well starting with Reagan and ending with Bush 41. Obama's economy grew at 1% correcting for inflation and population growth.
     
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  18. Ashwin Poonawal

    Ashwin Poonawal Active Member

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    Greed is a part of our nature. Financial successes only inflame our greed. The present form of capitalism over emphasizes the value of capital. It is easy to make money with money than with work. This is because capital controls the purse strings. Huge amount of wealth accumulation in a few hands, gives them power to manipulate economy by cornering markets and products, and by lobbying and string attached election contributions the government. We need a diffusion of power of wealth to manipulate economy. This will curtail the shortchanging of employees, and the exploitation of the consumer. Then wealth will be distributed more widely in the society, curtailing the evil power of greed.
     
    Last edited: Apr 14, 2017
  19. AFM

    AFM Well-Known Member Past Donor

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    Money is not capital. Capitalism/competition negates the formation of monopolies. Only government can create monopolies. Who will decide how to diffuse/distribute the wealth ?? Free market competition ensures minimum prices with maximum value via the processes of creative destruction and comparative advantage.
     
  20. Ndividual

    Ndividual Well-Known Member

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    Are you saying we need more psychologists?

    Not at all, sufficient resources exist but it is the responsibility of each consumer to produce the means necessary to acquire what they each consider to be above a poverty level of existence.

    My economic model? Not everyone is capable of participating, and the value of most everyone who IS capable of participating varies greatly from one another.
     
  21. Ashwin Poonawal

    Ashwin Poonawal Active Member

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    When we look around we see that high concentration of wealth actually kills competition.

    The existing degenerate environment of greed forces new entrepreneurs to compromise their moral convictions and adopt cunning ways, first for their businesses to survive against the unscrupulous competition, and later, after testing the fruits of corrupt methods, to prosper. The first offense of a kind against one’s own self is the most painful. Each subsequent one is easier than the preceding one. This craving for quick gratification is evident in mature and growing economies all over the world. Look at how processed food is made unhealthy with harmful preservatives and cheap ingredients, the quality of food in chain restaurants has degraded over the years, farm produce is made unhealthy by high-breeding, and the quality of dairy products by rampant use of hormones and antibiotics.

    The U.S. seems to be leading the way in such greedy health degrading enterprising. This makes the nation fat and unhealthy, requiring more medical attention. On the other side, medical drugs/treatments are marketed at exorbitant prices, and once they are in circulation, our medical drug industry shows instances of suppressing and discouraging immerging cheaper/better remedies, and of suppressing discoveries of dangerous side effects. The common man is getting squeezed from every side. The subtle influence of the rich on our legislature keeps our tax code from correcting the loop holes, which favor the rich heavily. This keeps the taxes of the less affluent high, and the entitlement programs strained. Our automobile industry ignored, or bought and shelved technical innovations, to avoid prerequisite expensive modifications to production processes, loosing against foreign completion in the end, retarding the country’s progress. Even our national sports have turned excessively commercial. Our society is losing from every side.

    As globalization advances, the economic gap between the developed and underdeveloped economies of the world keeps shrinking. This is eating away the advantage the rich countries enjoyed. The resulting tightening profit conditions within the rich countries make their big businesses, having had tested the blood of easily rising wealth during the post world-wars era, tend to exploit domestic consumers by low quality products and to shortchange the employees by keeping the remunerations way lower than the actual values rendered by their services, progressively more and more, creating unscrupulous competition for smaller businesses, forcing these ways down the line. This keeps lowering the standard of living of the masses.

    What we need is a way to defuse the power of money on economic decision-making, releasing the economic factors from the narrow channels of money flow that keep enriching the economically high and mighty. This needs to be effected without blocking individual’s ability to acquire wealth, which motivates economic production. It is best to achieve this economic power diffusion with least interference from other entities, like continued meddling by the government.

    Countries around the world try it in varying degrees and by different combinations. But so far most of the experiments have tried to shift the control from money to authority. USSR was an extreme example of this. This cannot work for long, because human greed for power, wealth and fame, has a high tendency to take over the process.
     
  22. AFM

    AFM Well-Known Member Past Donor

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    That's absurd and everything that follows from such an absurd statement.
     
  23. a better world

    a better world Well-Known Member

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    Supply side has worked well?

    Even taking your selected years, the socially-disastrous 'rust-belt' phenomenon proceeded apace during those years

    And as for the theory itself, its basic premises are based in unreality, and will ultimately lead to its own collapse,
    as with every system based on unreality.

    Friedman's model ...... in which the assumptions on which its logical
    consistency depends — the most important being:

    1. that no economic actor has the power to directly
    influence market prices,


    2. all market participants have perfect information as to the determination
    of market prices,

    3. that there are no external costs
    or benefits associated with the production or
    consumption of goods,


    4. and that people behave rationally as the term “rationally” is defined by
    economists—

    are not simply unrealistic and contradicted by empirical evidence
    but are, in fact, impossible to achieve in the real world.
    (Blackford 2013)).
     
  24. Econ4Every1

    Econ4Every1 Well-Known Member

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    As confusingly written as that sentence is, I'm just not sure how that applies. How is what you've said analogous to my hypothetical at all?

    If "Dad" is analogous to the government, it sounds like you're saying that some other government would provide for the people (kids)?

    Please explain?

    Not at all.

    The analogy between "Dad" and the government was simply to convey the fact that both have authority to impose rules. Of course, there are limitations on the rules a father just as there are limitations to the rules of the US government.

    The issue, imo, is to focus on rules that make things better for the nation as a whole.

    On a related note....

    There was an experiment done where groups of people are given real money. They are told they are competing with other groups and to win they have to pool their money together to win against other groups. However, they are also told they have the choice to donate the money they have been given.

    During the first round of the game, people, on average, give about 1/2 of their money, but by the 6th round of the game, the average people donate drops to about 15%. In the 7th round, the rules of the game change such that people are allowed to donate a portion of their money, in addition to what they need to donate to win the game, to punish players they feel aren't donating enough. In the 7th round, donations rise to 60% and 6 rounds later are between 85-90%

    Now in the contest of competition, "freedom" is deleterious to the group. People tend not to see the bigger picture (winning the game) and instead are either focused on keeping what they can for themselves as is generally only takes a single person to "free ride" to infect the group. People are more pursued by the injustice of free riders then they are at the prospect of winning the game.

    The government isn't a sudo-Dad, rather it is a collective authority that is responsible for creating the rules in society that will encourage people to work together to maximize it's potential to:

    1) Protect itself from other groups that don't share the same value system

    2) To maximize the health, education, and well-being of citizens in order to best accomplish #1

    Now I freely admit this is my interpretation of the role of the government rather than something strictly codified in the Constitution. However, the Constitution can be amended and I would support ideas that meet these goals. If it's not obvious, I don't believe that our current structure maximizes these goals and I think it's definitely headed in the wrong direction.
     
  25. AFM

    AFM Well-Known Member Past Donor

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    Do you know what supply side economic policies means ?? There is no assumption that market participants have perfect information. That is impossible to achieve. And yet supply side economics has produced growth of ~ 3% corrected for inflation and population growth whilst the command control economics of Obama produced ~ 1%.
     

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