Not true. I wrote off every expense and so did my boss (including my paycheck) when I worked self employed.
You're forgetting a good bit of that consumption stimulates china, not us. Everyone pays taxes. Even if it's sales tax, gas tax, property tax etc. Duh.
Why do you think the US is entitled to tax income earned off shore? This is like saying CA should get the sales taxes on business conducted in AZ? What happens in AZ stays in AZ and what happens off shore stays off shore...
All of the comments are about federal income taxes. What would be the point in discussing sales taxes? All consumption of all imports stimulates the origin of those imports. Yes most of what we consume today in the US are imports so in order to change or balance this the US must greatly increase exports or produce those imports in the USA. IMO we'll never produce those imports again in the US so increasing exports is the best way to energize the economy, create jobs, and tons more tax revenues...
Their balance?....Their balance of what? What exactly makes them think that a piece of paper with some numbers on it will increase anything? Are you saying that I can, without consequence, just write whatever numbers I want on these special pieces of paper, and people will continually give me things despite any other factors? -Meta
No matter how much money a company accumulates, they aren't going to hire more employees to create more product unless they know or at least have a presumption that there are customers out there who are going to buy that product. In other words, demand is what drives both the employment and the production and by extension the whole economy (wages, consumption, standards of living, the whole shebang). [video=youtube;T80-ConDFAQ]https://www.youtube.com/watch?v=T80-ConDFAQ[/video] -Meta
Yeah, they should do that, but government also ought to do its job to ensure that a dysfunctional economy is not an encumbrance to those people. I don't think anybody said anything about dictating wages. But the government has an obligation to ensure that the economy remains in a healthy state, working for the benefit of the people of this country. Whether that be by directly hiring folks to build up economic infrastructure, putting in place various incentives, or firming up trade relations with other countries,...as long as these things are good for the economy overall and don't conflict with any of government's other obligations,....I really don't see any good reason why government shouldn't be moving forward whenever any such opportunities for improvement are present. If the root problem in question is a lack of economic demand, then I respectfully disagree. Also, like I said before, if you implement a fix to something temporarily, then the benefits from that fix are going to be temporary. Don't want the effects to be temporary? Then don't make the fix temporary. Put a WPA program in place as a fixed part of the budget and keep it there as long as you see that it is working and improving the economy. Agreed. I think that is something that will help, but again I don't think it is the only thing that will help. And it would be prudent for us not to dismiss the other options should increasing exports prove more troublesome than we bargained for. -Meta
You're talking about that old idea that supply is, in and of itself, demand, under the assumption that producers only "produce" supply in the hopes of exchanging it for things that they want? Earlier in the thread I posted the two requirements for economic demand to exist: 1. A desire/need/want for something, measured by how much a person is willing to offer up in exchange, and 2. the ability to make such an offer, be it in the form of goods, services, or money, in exchange for having that desire met. Now,...it is the case that supply can act as goods granting a producer with the ability to offer up such goods in exchange for the things they want, and it can also be argued that the very fact that a producer "produces" supply..., is indication that there is something they desire, for which they intend to exchange the supply for.....However..... 1. If the particular form of supply being produced is produced in such quantities that the markets are flooded to the point that everyone in the economy has enough to satisfy their desire for the type of supply, then producing even more will yield no further ability upon the "producer", as people will no longer be willing to exchange anything for something they deem themselves to have enough of already. 2. It is possible for producers to "produce" excess supply and yet not be willing to exchange it for anything. For instance, say that there exists a person who just loves chairs, and produces them day in and day out, increasing their supply, all for no other reason than to accumulate more and more. 1 chair, 2 chairs,...he eventually creates a supply of 100 chairs. But these chairs are not acting to create economic demand, as there is nothing in the economy which he desires for which he is willing to part with his chairs. Well.....that is until the day that he devises a scheme to trade two of his chairs for every three of someone else's. So say he decides to offer up 10 of his chairs for such an exchange. Supposing there are people out there willing to take his offer, then those 10 chairs are creating economic demand,...but the other 90 are not. And so it would remain should he decide to perpetually put 10 chairs into circulation, those 10 would continually create demand as long as others are willing to trade for them,...the other 90 as well as each additional chair he obtained would continue to exist as a supply of chairs not contributing to economic demand. Again, for no other reason than his lust for chairs, he would continue to accumulate without having any intention of trading the extras above the 10 he keeps in use in exchange for anything the markets could offer. Now, replace "chairs" with "money" and you can easily understand how such a scenario is far from impossible. ------- So while it may be the case that supply will lead to demand under certain circumstances, due to the two reasons explained above (1 and 2) it is not the case that supply == demand. It is through our actions that we obtain the things we want. It is not through getting, that we want and obtain what we got. -Meta
Overly simplistic and reductionist. Demand is one aspect of an economy. It's not the only aspect. Of course, focusing on demand fits very well with political ends of confiscating people's money and turning it over to "increase demand".
Their bank account balance. Experience. When I deposit a check, my balance is increased accordingly. When I use my debit card, my balance is decreased accordingly. No.
I'm not saying that demand is the only aspect,....I'm saying that it drives all the others. Are you suggesting that there are some other aspects of the economy which will lead to jobs in the absence of demand? If so, then what exactly are these factors??? -Meta
What does their bank account balance consist of? What is it measured in? But why exactly does that happen? Why, when you deposit a check, does your balance increase? And why are you so certain that it will increase by the amount written on the check every time? Really?! Why not? Why can't I write whatever number I want on the checks?? -Meta
I'm saying that your view of an economy is oversimplified and reductionist. Demand doesn't drive the economy any more than supply does. Everything works together.
Mine is measured in a unit called "dollars". Because the bank adds to my account balance, while a corresponding subtraction is made from the account of the check issuer. It might not, actually. If the account of the check issuer doesn't have sufficient funds, my bank will not add to my balance after all. I just provided you with the information necessary for you to answer this question yourself. So you really think that the government owns all the bills it prints? That's your position?
It's more than that. The basic idea is that people buy production with production. This puts the cart before the horse and assumes that demand exists before something is supplied. What you are neglecting to mention is that something must be produced first, in order for that product to be traded for new product. Money is not wealth, so it must be some other wealth to be traded for wealth. No? He's trading his wealth for chairs. Sound like a demand for chairs, to me. So, they are trading product for product. Say's Law. Someone must have produced those other chairs in order for their to be a trade for chairs. All that money does is facilitate these trades by making it easier than carrying around a bunch of chairs. However, there must be something produced before money can be a store of value. Money isn't wealth. Creating money doesn't create wealth. People do not trade for money, they trade for the wealth that money can buy. Creating chairs that people want is creating wealth. Creating machines that create chairs also creates wealth.
The US has the best economy in the world...this is as good as it gets. There have always been and will always be people on the lower end of the income/wealth curve. There never is more jobs than workers so people are required to compete for their position in the workplace. The government cannot solve these perceived problems! If people want more then people need to go after more. Those who wait for government to solve their problems will remain on the lower end of the curve forever. Dictating wages? A minimum wage is dictated by government! Now all the talk about forcing the minimum wage higher, and income equality, and wealth equality, etc. are all dictated by government. The government can do anything it wishes outside of meddling with the private sector! If the government wishes to subsidize every worker who earns $50K or less then let the government do this with tax revenues...not meddling with the private sector. BTW; no where is it written or implied that government "has an obligation to ensure that the economy remains in a healthy state". Anything the government does which is pro-business is fine. Since government cannot 'fix' the economy, that the economy must grow itself on it's own merits, then any stimulus the government creates is 100% temporary...when the government money stops flowing the jobs go away. The entire purpose of a government stimulus, other than welfare, is to boost the economy for some period of time HOPING that the root economy will fix itself and get on with things. If the government spends another $2 trillion in stimulus debt money, this $2 trillion definitely stimulates the economy, however, when the $2 trillion is spent, if the root economy has not grown on it's own merits, the economy will drop $2 trillion. Why do you suppose we continually have $500+ billion deficit spending? Because no matter the government is stimulating the economy every year with $500 billion to $1 trillion in deficit spending, if the root economy won't grow on it's won merits, then if you eliminate the government spending, the economy will drop $500 billion to $1 trillion. Stimulus spending is temporary! There are only two ways to grow the US economy (other than government spending); personal consumption and exports. We have proven year after year that we are not going to personally consume at high growth rates, so exports are definitely a place to focus. However, the US cannot increase exports if it can't be globally competitive!
"Everything works together" you say? Now that's oversimplified reductionism. Of course everything works together,...it should go without saying,...but demand is the catalyst here, if there is no demand for a particular good or service then there is no impetus for companies to hire employees for the purpose of increasing the supply of said goods or services. -Meta
Lol, I rest my case. Sorry,....I don't like to have to ask questions with such obvious answers,.... but it seemed necessary in order to have you understand where it is that the value of your checks and debit cards actually comes from. Well.....in a sense....yeah, that is my position, I would say that it should always be the case, that whenever something of value is created by people, those who specifically created the value in question should without a doubt be considered the initial owners. And since it is government which creates both the physical form of money as well as endowing money with its initial exchange value, then yes, government should be considered the owner of those newly printed bills. Partial or full ownership of value can of course be given to or shared with someone else as part of an exchange or agreement, and the owner of the item of value has a right to set terms and conditions of use as part of such an agreement. To that end, our government has clearly set such terms in the form of tax policy. Now, that said, alternative forms of currency such as bitcoin etc. aren't created by government and don't get their value from government, so,... try as it might,...I do not believe our government has any right to regulate such currencies past the point of ensuring that it cannot be confused for U.S. tender. But our government certainly does have the right to regulate the use of its own money... -Meta
Buying production with production, using supply as an exchange for more supply....what you wrote has the same meaning as what I wrote. What you quoted assumes no such thing. It is simply a definition of what exactly demand is. In fact, it is possible for demand for a particular product to exist prior to there existing a supply of that product, and it is also possible for supply of a product to exist before there is any demand for it. But, it is in fact demand for a product which will motivate people to act towards increasing the supply of that product, while it is not the case that the reverse can be said, as simply increasing the supply of a product will not all of a sudden increase the demand for it (ie: more supply of a product offered will not make people want to buy it more, nor will it make anyone more able to buy it) Yes, every chair he offers up in exchange for something is creating some amount of economic demand (2/3rd chair's worth in this case), but every chair he does not offer creates none, and if he should hoard them all, then his ever increasing supply of chairs creates no additional demand. This is proof that demand and supply are not necessarily the same thing. And of course, someone must have both wanted and had the ability to obtain chairs for them to have ever even bothered with the effort. A classic chicken or the egg dilemma. Though, while it may seem daunting at first, we can solve such a dilemma easily by tracking back into the cycle's past and reducing it to its primal origins. And as such, based on our definition of "egg" and our definition of "chicken", we find that it was in fact the egg that came first. Likewise, let us look at the dilemma of supply and demand in the same light, in terms of supply, demand, and ability. We know the definition of demand. Ability is self-explanatory. Supply, in an economic sense, is defined as the amount of product produced or gathered for purpose of exchange or consumption. So then let's say a person produces a house. I would say he created it, in part, because he had the ability to. You would say that he only had the ability to produce the house, because he had either exchanged something for or produced himself a supply of planks and nails. Then I'd say that he or someone else produced that supply of planks and nails because they had the ability to do so. And of course, they had the ability to produce planks and nails because someone produced a supply of logs and metal ores... To simplify this a bit further, consider the case in which all of this production is being conducted by the man building the house. Either way you slice it, he's going to have to either produce or gather a supply of some raw materials for him to build his house. There is no production of supply prior to this point. But what is it that causes and enables him to kick off this gathering of resources? It is for no other reasons than that he has the ability to acquire or produce the raw materials needed, and the willingness to put forth the effort of doing so in exchange for him eventually meeting his ultimate goal of building a house. And what is that willingness and ability if not the exact definition of demand which I posted earlier? The only reason I mentioned money was to illustrate that supplying people with more money does not increase demand if they are not willing to spend it. But money itself was not an integral part of the argument. Replace it with chairs, houses, laptops, any good or service really, and the same concepts apply. -Meta
You guys have an intriguing discussion going I have not thought in detail about all the points raised As i understand your point, your view of demand seems over simplified. Take the ipad.... Before Apple made the ipad, there was no demand Apple invested huge resources in a product without demand After the product was supplied, the demand was identified But even so, If they had made it poorly, there still would be no demand Or take the case of a new song being recorded What is the demand? No one knows until the song is released Again there is an investment based upon speculative demand The bulk of the investment happens prior to the demand The cost if added supply in this case is negligible Demand is independent of cost of production, or supply
If you agree that everything works together, why did you call saying so a oversimplified reductionism? One could also say that production is the catalyst, because without having produced something, one has no ability to pay. No ability to pay, no demand.
You rest your case? Not sure why. The currency unit called "dollar" precedes the existence of the US government. My bank balance is denoted in dollars, but no US currency was ever deposited into it. So why should the government own it. According to your "theory", the government owns only the little pieces of paper it prints.
Even if we are the best as compared to other countries, we should not simply settle for being better than all the others, many of which might not even be all that great. Instead, we should strive to be the best that we can, period, regardless of how good everybody else is. What's your point? Even if they remain on the lower end relative to the rest of us, such does not mean their lives cannot be improved, and ours too for that matter. That's the way things are today,...not the way they have to be. Competition in the economy is good, don't get me wrong... But to simply accept that workers continually compete with each-other to produce more for less pay perpetually while the same competition (for employees) is not happening in proportion on the employment side seems to me to be an avocation of a "race to the bottom" mentality which ultimately will not do our country any good. But it can make them better. Yes, people should act on an individual level to achieve their goals...they shouldn't wait for government to act. But at the same time, when government has within its power the ability to make people's efforts more likely to bear fruit, government should not be waiting around for others to act either. If you're saying that paying out money to workers in exchange for infrastructure etc. (or to welfare recipients) with tax money is a better idea than trying the fix the issues by mandating a minimum wage, then I agree with you 100%! On the contrary, the constitution clearly states that the purpose of the government being allowed to raise taxes is to, "provide for the common Defence and general Welfare of the United States". If government allows for an unhealthy economy, then the welfare of the country and its people, who depend and rely on said economy, suffers as a result. That's what I'm saying....if you eliminate the spending then you lose future benefits. Don't want the benefits of the fix to be temporary? Then don't make the fix itself temporary. That's because there is insufficient demand. And as of yet, we as a country haven't really bothered to even try to do much about that fact. Fortunately, people are beginning to wise up I think. Yes, opportunity for increasing exports should definitely be a focus too. But I admit I am a bit skeptical when you mention making the U.S. more "globally competitive". There are lots of things that could make us more competitive, but if by that you simply mean that we need to work more hours for less pay, then that once again seems to be wrought of a "race to the bottom" mentality which wont be any good for our country as a whole in the long run. -Meta
