Wealth 85 richest equals wealth 3.5 billion poorest.

[Danoff]

So if everyone's income went up would that benefit the economy? Or would it benefit the economy if everyone's income went down? That surely is economics 101, so should be easy to answer.

It is easy to answer actually but there is some ambiguity about what you're asking. Are you asking about everyone's wages going up or down in terms of real purchasing power? Or everyone's wages going up or down in terms of dollars. One is achievable through positive or negative economic growth (note that minimum wage increases do not cause economic growth), and latter is achievable through inflation. I'll assume you're talking about the latter since it's the most applicable (although not perfectly applicable) to the minimum wage question - I'll assume no net change in the economy.

If everyone's income went up (in terms of dollars), and stayed up, it would hurt the economy since it would mean that existing wealth was being destroyed (inflation).
If everyone's income went down (in terms of dollars), and stayed down, it would hurt the economy since it would mean that existing wealth was being destroyed (deflation).

In the one case you're destroying existing wealth by printing more dollars (that's the only way to achieve that effect). In the other case you're destroying existing wealth by burning dollars (that's the only way to achieve that effect).

Unfortunately your question is not very applicable to the minimum wage issue. Try rephrasing more directly.

 

[Enemem]

It is easy to answer actually but there is some ambiguity about what you're asking. Are you asking about everyone's wages going up or down in terms of real purchasing power? Or everyone's wages going up or down in terms of dollars. One is achievable through positive or negative economic growth (note that minimum wage increases do not cause economic growth), and latter is achievable through inflation. I'll assume you're talking about the latter since it's the most applicable (although not perfectly applicable) to the minimum wage question - I'll assume no net change in the economy.

If everyone's income went up (in terms of dollars), and stayed up, it would hurt the economy since it would mean that existing wealth was being destroyed (inflation).
If everyone's income went down (in terms of dollars), and stayed down, it would hurt the economy since it would mean that existing wealth was being destroyed (deflation).

In the one case you're destroying existing wealth by printing more dollars (that's the only way to achieve that effect). In the other case you're destroying existing wealth by burning dollars (that's the only way to achieve that effect).

Unfortunately your question is not very applicable to the minimum wage issue. Try rephrasing more directly.

Thanks for the answer. I understand that.

Niky, (Hey I don't like economics, but people keep saying, it's simple economics, so I'm trying to understand) that makes perfect sense. So the problem is that small businesses are unable to absorb the costs of the increased wage, so they'll employ less people or move them to less hours. That I understand. I've shown that certain economists have said that this is okay, the downside isn't really as bad as those who poo-poo increasing the minimum wage think it is.

There are lots of people who agree with increasing the minimum wage, but it appears, in here, it's just me.

 

[Danoff]

Thanks for the answer. I understand that.

Niky, (Hey I don't like economics, but people keep saying, it's simple economics, so I'm trying to understand) that makes perfect sense. So the problem is that small businesses are unable to absorb the costs of the increased wage, so they'll employ less people or move them to less hours. That I understand. I've shown that certain economists have said that this is okay, the downside isn't really as bad as those who poo-poo increasing the minimum wage think it is.

What's the upside of increasing the minimum wage?

 

[Blitz24]

What's the upside of increasing the minimum wage?

There isn't any. I don't know why politicians can't see past their own little worlds to realize that.

 

[Enemem]

What's the upside of minimum wage?

Low-wage employment means that even those who work full-time, fail to make ends meet, and economy slows because too few families have enough money remaining in their salary to contribute to the economy. A high enough minimum wage would turn poor people into consumers, something they're not at the moment. How do you contribute to the economy with no money spare.


I've been writing about a small increase in the minimum wage, in fact I never said how much of an increase, even if it was just a penny per hour, it would hurt the economy, people would lose jobs, well they're the arguments that have been used against increasing minimum wage.

However, what would happen if the minimum wage were upped to $25K per year?

The economists in this forum would say that jobs would be destroyed, companies would go bust, the economy would be toast.

Now, this is were my problem in this thread comes from. Can I provide evidence that a $25k minimum wage would benefit the economy. Answer : No. Can you provide evidence that a $25k Min.Wage would disadvantage the economy. Answer : No. It's never been done.

So presumably we are at an impass. Unless an economist where to actually use economics to try and figure out, what might happen, presumably this is what economics is for.

http://www.demos.org/sites/default/files/publications/RetailsHiddenPotential.pdf

The conclusion:

Large retail firms are in the position to improve the lives of millions of American workers and their families, and to boost the national economy, all while improving their own outlook for growth. This study shows that a new wage floor that pays the equivalent of $25,000 per year for full time work, or $12.25 per hour, would raise the living standards of at least 5 million American households and feed back into the economy across sectors. Workers spending higher incomes in the marketplace – on retail goods and other purchases – could lead to the addition of $11.8 to $15.2 billion to GDP and between 100,000 and 132,000 new jobs. At the same time, the wage increase would be a productive investment for firms and a negligible cost for consumers. With a host of benefits and a small price tag, large retailers can embrace this opportunity to make a positive change in the economy by paying a wage that supports families, improves productivity, increases sales and generates new economic activity and jobs.


Now I can't dispute this. Or agree with it. But it seems to be a valid way to look at it. What's the alternative, lower the minimum wage?

 

[Blitz24]

Or let the market work on it's own. Government intervention does not help any progress.

A high enough minimum wage would turn poor people into consumers, something they're not at the moment. How do you contribute to the economy with no money spare.

Something tells me a lot of the reasons that they don't have any money is because they are asking (and spending) for things outside of their wages and choosing to use any expendable money on things they cannot really use.

I've been writing about a small increase in the minimum wage, in fact I never said how much of an increase, even if it was just a penny per hour, it would hurt the economy, people would lose jobs, well they're the arguments that have been used against increasing minimum wage.

So you are arguing for a penny increase? That may be a good increase because it will average out to nothing at all. That's the way all of the corporations will vote.

The economists in this forum would say that jobs would be destroyed, companies would go bust, the economy would be toast.

Now, this is were my problem in this thread comes from. Can I provide evidence that a $25k minimum wage would benefit the economy. Answer : No. Can you provide evidence that a $25k Min.Wage would disadvantage the economy. Answer : No. It's never been done.

So presumably we are at an impass. Unless an economist where to actually use economics to try and figure out, what might happen, presumably this is what economics is for.

So basically economists have no idea what they are doing because they are not subscribing to your theory that raising the demand for jobs (by increasing wages) will not affect the supply of jobs (decreasing the amount of jobs available). Somehow I cannot see this as likely. Also raising a wage to $25k a year; it's an extreme risk. Sure it CAN go right but it CAN also go wrong (and if economists are right, it WILL go wrong), the employment level will drop due to less available funds to pay the workers and more people will be mad at whoever suggested this idea. In an ideal society where companies can do this is the one where they are not for profit. That's probably not happening soon.

The conclusion:

Large retail firms are in the position to improve the lives of millions of American workers and their families, and to boost the national economy, all while improving their own outlook for growth. This study shows that a new wage floor that pays the equivalent of $25,000 per year for full time work, or $12.25 per hour, would raise the living standards of at least 5 million American households and feed back into the economy across sectors. Workers spending higher incomes in the marketplace – on retail goods and other purchases – could lead to the addition of $11.8 to $15.2 billion to GDP and between 100,000 and 132,000 new jobs. At the same time, the wage increase would be a productive investment for firms and a negligible cost for consumers. With a host of benefits and a small price tag, large retailers can embrace this opportunity to make a positive change in the economy by paying a wage that supports families, improves productivity, increases sales and generates new economic activity and jobs.

Of course it doesn't. Look at the potential drawbacks of this proposal. I see nothing covering those in your summation. Also "large retailers" can afford it. What about the people who will lose their jobs as the retailers push smaller stores out of business? What about the other sectors (which apparently aren't important enough to deserve mention) that also operate on a minimum wage floor (as they would be if it is enacted)? Pretty sure Wal-Mart and big box giants will do better but also sure that food stores and restaurants will suffer immensely.

Now I can't dispute this. Or agree with it. But it seems to be a valid way to look at it.

Posting an article and then saying yes, no, maybe so does not really help your position (or the reason why the article was chosen).

What's the alternative, lower the minimum wage?

Or do nothing. Let companies solve their wage issues amongst themselves.

 

[Enemem]

Well if you're pretty sure, then there's a part of you that admits that it's possible you're wrong. That's the first time anyone in this thread, who disagrees with me, has admitted it.

It's about time. After all things like supply/demand are only models (that's economics 101 I would have thought).

 

[Blitz24]

Well if you're pretty sure, then there's a part of you that admits that it's possible you're wrong. That's the first time anyone in this thread, who disagrees with me, has admitted it.

It's about time. After all things like supply/demand are only models (that's economics 101 I would have thought).

Almost all instances of models can be debunked. I am admitting it CAN be wrong because it CAN be wrong because it has never been done. The reason it hasn't been done is the results could be bad, if not catastrophic. Its the same exact reason that senators and any people in office are afraid to do anything that could be controversial. They fear the repercussions and not being elected again, so they are stymied into promoting something they may have spent years campaigning that they wouldn't do.

 

[Enemem]

Posting an article and then saying yes, no, maybe so does not really help your position (or the reason why the article was chosen).

You've just told me that you could be wrong. I'm aware that I could be wrong, so can't claim that it's true. It agrees with the way I look at the world, but doesn't mean it's right.

 

[Danoff]

Low-wage employment means that even those who work full-time, fail to make ends meet, and economy slows because too few families have enough money remaining in their salary to contribute to the economy. A high enough minimum wage would turn poor people into consumers, something they're not at the moment. How do you contribute to the economy with no money spare.

That money doesn't come from thin air, it's taken from something else to give to these "poor people". So there is no net change in money circulating. So new people "contributing" to the economy is not an upside. I don't think there is an upside.

Now, this is were my problem in this thread comes from. Can I provide evidence that a $25k minimum wage would benefit the economy. Answer : No. Can you provide evidence that a $25k Min.Wage would disadvantage the economy. Answer : No. It's never been done.

Your "evidence" is called "outsourcing". It's so common that it has been given a name.

Large retail firms are in the position to improve the lives of millions of American workers and their families, and to boost the national economy, all while improving their own outlook for growth. This study shows that a new wage floor that pays the equivalent of $25,000 per year for full time work, or $12.25 per hour, would raise the living standards of at least 5 million American households and feed back into the economy across sectors.

But it has to cost exactly the same amount elsewhere. Again, the money doesn't come from thin air. Yes if you raised the salaries of 5 million American households you'd improve their standard of living - but you'd reduce something else, and that something else is currently more efficient or we wouldn't be doing it.

Workers spending higher incomes in the marketplace – on retail goods and other purchases – could lead to the addition of $11.8 to $15.2 billion to GDP and between 100,000 and 132,000 new jobs.

This is how I know that whoever did that study doesn't understand economics. What about the jobs that it costs?

At the same time, the wage increase would be a productive investment for firms and a negligible cost for consumers.

Here's the thing about companies, if a negligible cost to consumers increased profit, they'd already be doing it. The assumption is that we can cover the increased spending by raising prices so little that consumers won't change their buying practices. Well, if prices could be raised a little without changing buying practices, companies would do it already - to maximize profit. They constantly seek a balance of bringing in the absolute largest amount of money they can at all times. Higher price means reduced profit (fewer sales), lower price means reduced profit (not enough profit per item despite more sales). Each company does this calculation - most large companies employ whole teams of people to do these calculations (who generate more money than they cost by getting it right). So raising prices to cover wage costs is not going to happen unless every single company does it across the board - and when that happens, there's no point in doing it to begin with.

What do they do instead of raising prices when their costs go up? Cut costs elsewhere - like downsizing, reducing benefits, or reducing hours.

Now I can't dispute this.

I can (and did). A lot of people talk and publish in economics without understanding it.

What's the alternative, lower the minimum wage?

Eliminate it. The only jobs that will be affected are jobs that are currently minimum wage, jobs that don't exist because the minimum wage exists, jobs that are centered around automation to eliminate minimum wage jobs (like someone who designs self checkout machines), or outsourced jobs in india or elsewhere.

What's the upside to eliminating minimum wage?

- More jobs available means it's easier to get your foot in the door and work your way up to become productive. This means a better more upwardly mobile workforce.
- More flexibility on the part of companies to provide things like customer service. You wait less time at the checkout line and you get answers faster - which improves your productivity.
- Fewer unemployed people means fewer unemployment checks from the government and reduced aid needed in general. Some people making extremely low wages will still get on food stamps and private charity, but those people are better off being able to move upward.
- The incentives line up properly. Low income people get a direct measure of the work/reward system rather than there being a step function below which they are incentivized not to work.

 

[Enemem]

I nearly understand everything you are saying( so I haven't quoted it), and agree with it, and I now understand in better details the objections to an increase in the minimum wage. Thanks matey.

That money doesn't come from thin air, it's taken from something else to give to these "poor people". So there is no net change in money circulating. So new people "contributing" to the economy is not an upside. I don't think there is an upside.

So increasing the minimum wage would only really work, as I'd like it to, if companies took the option of redistributing their pay scales. Can't see any of them volunteering for it, as current disincentives for so doing. Unless you are already on skeleton workforce, in which case it might.

Hmmm. To put it another way, a minimum wage makes the workforce, slightly more 'whipped' than if there were no minimum wage.

However, I still feel that if no minimum wage existed then, there would be even more people on the poor list.

But it has to cost exactly the same amount elsewhere. Again, the money doesn't come from thin air. Yes if you raised the salaries of 5 million American households you'd improve their standard of living - but you'd reduce something else, and that something else is currently more efficient or we wouldn't be doing it.

Presumably the government are always tinkering with %'s here and there tweaking the balance of the economy, in order to [insert goal here].

If the goals are different then the tweaking would need to be different. The distribution-difference of wealth from poor to rich is different to how it used to be. It didn't used to be 85 to 3.5 billion. Rich people 30 years ago had more than enough money. Now they've got even more.

 

[Danoff]

Presumably the government are always tinkering with %'s here and there tweaking the balance of the economy, in order to [insert goal here].

In an economic sense, every time the government tinkers with %'s here and there, they cause inefficiency in their economy. By tinkering, they distort market signals and cause malinvestment and ultimately crony capitalism. For example, when the government decides that it wants to tinker with wind energy, it decides to offer money to companies producing wind farms. Suddenly wind energy that was not previous economical is economical. Companies start investing in wind energy to get the government funds. Companies also start lobbying congressmen to bring the wind farms to their state under the management of their company. The congressman sees the votes in that and lobbies the government to give the funds to said company. This company was not the best most efficient company to do the job, and the state wasn't the best site for it, but the company was the most connected. Now suddenly you've got an inefficient wind farm (compared to what you could have had) which is only even economically feasible because the government is forcing it to be so. Now you've got electricity overhead that costs more than it used to, and a company that focuses on political connections rather than engineering and manufacturing.

Now, that example had nothing to do with minimum wage except that it is a clear demonstration of why you don't want the government tinkering with percentages in any respect. The wind farm example is a real one too. Government tinkering always introduces inefficiency and malinvestment.

How can minimum wage cause crony capitalism? Well if your company has a lot of automation and your competitors rely on cheap labor, you lobby for a raised minimum wage so that their business model suffers.

 

[Enemem]

In an economic sense, every time the government tinkers with %'s here and there, they cause inefficiency in their economy. By tinkering, they distort market signals and cause malinvestment and ultimately crony capitalism.

1) How do you know that a tinker causes inefficiency, especially if it oils the mechanism.
2) If the tinkering has been done by an idiot tinker, would some tinkering by a skilled tinker result in a worse economy.
3) Are you suggesting that we don't need economists?

I'd also like to respond to something a little earlier when the question of X amount of money being distributed to the poor over the rich, would not make a difference to the economy. I really don't see, how someone who is more likely to spend money, is worse for the economy than someone who is more likely to invest or save the money.........(and as I typed the word invest, I had a thought..... investing and spending are the same from an outward POV, the only difference being the organisations that benefit from the money. Inwardly the poor get food, the rich get more money for more food, though I'll be honest I'm still not sure where that extra money comes from).

Now suddenly you've got an inefficient wind farm (compared to what you could have had) which is only even economically feasible because the government is forcing it to be so. Now you've got electricity overhead that costs more than it used to, and a company that focuses on political connections rather than engineering and manufacturing.

Economically feasible!!!!!!!!!

Doesn't matter if it costs more, if the benefits outweigh the disadvantages, then the extra money is worth it, hopefully whilst 20,000 people might die falling off windmills, that's outweighed by the 8,000,000,000 who don't get their planet ruined for them, by smog or radiation.

 

[niky]

How does having maintenance-intensive windfarms that provide only a modest amount of electricity for the investment and maintenance cost, farms that end up either abandoned or which require subsidy for the rest of their lives, help people in general and not just isolated populations?

We have abandoned windfarms here, too.

Hydroelectric, geothermal, those work, and are cost-effective. Solar, becoming marginally so. Wind? Still not there yet.

 

[Danoff]

1) How do you know that a tinker causes inefficiency, especially if it oils the mechanism.

It is inherent. It's like asking how I know friction leads to entropy. You roll a ball along a frictionless plane, the energy at the final state will be greater than if you roll the ball along a plane with friction. In economics, government is friction.

2) If the tinkering has been done by an idiot tinker, would some tinkering by a skilled tinker result in a worse economy.

It's less friction, but still friction.

3) Are you suggesting that we don't need economists?

Businesses will still need to do economic analysis to forecast and strategize their position in the market. Do we need government economists? No. Why should the government need economists?

I'd also like to respond to something a little earlier when the question of X amount of money being distributed to the poor over the rich, would not make a difference to the economy.

Friction. Also disincentive and malinvestment.

Getting the government involved in stealing money from one group and giving it to another hurts everyone involved. The people the money is stolen from will change their behavior, lobbyists will attempt to take advantage of the money stealing scheme, and the people the money is being given to change their behavior - often in the direction of working (producing) less.

Doesn't matter if it costs more, if the benefits outweigh the disadvantages, then the extra money is worth it, hopefully whilst 20,000 people might die falling off windmills, that's outweighed by the 8,000,000,000 who don't get their planet ruined for them, by smog or radiation.

There is no way to know whether the "extra money" is worth it. In the meantime you have invited crony capitalism. One way to limit that is to create rules that are in line with government's proper role rather than immorally expand the role of government into the private marketplace by trying to have the government pick winners and losers in a particular market. Rather than subsidizing, simply create rules about pollution, make it easier to prosecute polluters, make it easier to quantify pollution damages in court - there are real ways to do this that would result in polluters having to face much more direct incentives and find the most efficient process through which to reduce pollution. Best of all, it costs taxpayers almost nothing to do it right as opposed to a fortune doing it wrong.

 

[FoolKiller]

I know I am jumping in pretty late here, but:

Low-wage employment means that even those who work full-time, fail to make ends meet, and economy slows because too few families have enough money remaining in their salary to contribute to the economy. A high enough minimum wage would turn poor people into consumers, something they're not at the moment. How do you contribute to the economy with no money spare.

If this were true we would have ended poverty in the US years ago. The minimum wage was created in 1938, for the purpose of giving the poor workers a livable wage so they could be consumers who can contribute to the economy with money they previously didn't have to spare. And it has been raised 23 times since, because those poor workers needed to make a livable wage. Every time the same argument of making them new consumers was used.

Fact is, the market moves with the minimum wage. Take right now for example. They want to go from. $7.25 to $10.xx. For simplicity sake I will say they want it to be $10 even. This new, proposed number is based on the current poverty rate. The goal to be to get them out of poverty. People just talk about minimum wage workers being changed, but they forget that every pay in between has to be raised too. That is a lot more raised wages, increase to budgets, and increased payroll taxes (the real reason?) than they claim.

But that creates a new conundrum. The guy who made $9.50, either by having a higher paying position or getting raises after starting at $7.25, is now worth no more than the lowest level employees in the nation. Heck, the guy making $10 an hour now will suddenly be the in the poorest range of workers. Is that fair to those guys? Of course not. So, they should get more, right? So does the guy making $9.50 now make $12.25 and the guy making $10 makes $12.75. But what about the guys make between $10 and $12.75? Suddenly their value is lower. Keep going down this road for a few years and suddenly the federal poverty level is nearly $13 an hour and the minimum wage workers are still the poorest people in the world with no more buying power than they had.

The way out of poverty is not just being handed more money at the lowest level possible, but by working your way out of that level. That is why the minimum wage keeps needing to be raised. What this ultimately does is cause more money to be printed and released into the world. If the economy goes from $20 billion to $50 billion with no productivity there is less value for a dollar amount. True economic growth occurs due to an increase in productivity, not just larger numbers of cheap, paper bills being passed around.

 

[Danoff]

What this ultimately does is cause more money to be printed and released into the world. If the economy goes from $20 billion to $50 billion with no productivity there is less value for a dollar amount. True economic growth occurs due to an increase in productivity, not just larger numbers of cheap, paper bills being passed around.

I'm right there with you until you get to this part. The federal government doesn't print money to offset minimum wage, they print it to pay for government debts. It costs the government nothing to order employers to raise their wages at gunpoint, and the money supply does not need to be expanded to do it. However, the expanding money supply does create inflation that helps combat the effects below that I'm about to go into and help nullify the minimum wage penalty. So what happens if the money supply is not expanded and minimum wage is raised? Where does the money come from?

Optimally the money comes from the workers themselves. They produce more by taking on increased responsibility to offset their increased wages. So, for example, if someone is making enough money for the company to be worth $8/hr now, and the minimum wage is raised to $10/hr, then again optimally, that employee increases his productivity by 25% to earn his new pay. As a result, the economy grows, and the employee's raise is coming entirely from the employee's productivity. How do you raise your productivity 25%? The most straightforward way if you're working 40 hrs/week would be to work 50 hrs/week instead.

What is more likely, is that with the increased overhead companies will have to either raise prices or lay off workers.

Raising prices is not a problem if all of your competitors have their overhead increased as well. If the entire market for a certain product raises prices simultaneously, and especially if that market isn't easily gone without by consumers, then the pay raise comes from the customers - directly offsetting something else they would have purchased. If, for example, the price of groceries goes up, then people will cut back on luxuries, and you see a shift in the economy where people in luxury industries get laid off as grocery workers make more money. When this happens, the consumers' standard of living goes down (luxuries traded in for necessities), the luxury industry workers' standard of living goes down (job traded for no job), and the grocery workers standard of living stays the same (wages go up, cost of necessities goes up). So the minimum wage made everyone a little poorer and actually shrank the economy.

Laying off workers is a great option if your labor force is easy to outsource. If you can make all of your products in india or china and ship them over here for less than people cost here, you'll do that. As the cost of local labor rises (because the government raised it), outsourcing becomes more and more economical. People wonder why US industries outsource... well... minimum wage, social security, healthcare, these all make outsourcing very appealing. Outsourcing is the option of choice for most industries when faced with rising minimum wage.

In total, inflation actually helps offset minimum wage. 100 years from now when $10 doesn't buy a loaf of bread, a minimum wage of $10 would affect almost no one. But to make sure that it continued to have a negative effect on the economy, it would have been raised 20 times over that 100 years and be at $100/hr.

 

[FoolKiller]

I'm right there with you until you get to this part. The federal government doesn't print money to offset minimum wage, they print it to pay for government debts. It costs the government nothing to order employers to raise their wages at gunpoint, and the money supply does not need to be expanded to do it. However, the expanding money supply does create inflation that helps combat the effects below that I'm about to go into and help nullify the minimum wage penalty. So what happens if the money supply is not expanded and minimum wage is raised? Where does the money come from?

I wasn't actually thinking about more printed bills used to cover minimum wage, but I see how that came across like that.

I was referring to the fact that just because the minimum wage worker gets more mandated money to be a consumer with doesn't mean they have more real value.

Laying off workers is a great option if your labor force is easy to outsource. If you can make all of your products in india or china and ship them over here for less than people cost here, you'll do that. As the cost of local labor rises (because the government raised it), outsourcing becomes more and more economical. People wonder why US industries outsource... well... minimum wage, social security, healthcare, these all make outsourcing very appealing. Outsourcing is the option of choice for most industries when faced with rising minimum wage.

The reality is that most stereotype minimum wage jobs (flipping burgers, janitorial, cashier, etc) can't be outsourced. That usually goes toward labor intense, higher paying jobs. Now, a janitor might find himself replaced by an immigrant.

I keep waiting for the technology from Back to the Future 2, where robotic monitors wait on me in a restaurant. The moment that happens these minimum wage guys are going to be happy to have any job.

 

[Danoff]

The reality is that most stereotype minimum wage jobs (flipping burgers, janitorial, cashier, etc) can't be outsourced. That usually goes toward labor intense, higher paying jobs. Now, a janitor might find himself replaced by an immigrant.

It's true that a lot of outsourcing is really past tense. The unskilled labor jobs that involved making clothing, electronics, or assembling plastic bits have been shipped to china a long long time ago. But the reasons I cited are still valid.

 

[Enemem]

In the meantime you have invited crony capitalism. One way to limit that is to create rules that are in line with government's proper role rather than immorally expand the role of government into the private marketplace by trying to have the government pick winners and losers in a particular market. Rather than subsidizing, simply create rules about pollution, make it easier to prosecute polluters, make it easier to quantify pollution damages in court - there are real ways to do this that would result in polluters having to face much more direct incentives and find the most efficient process through which to reduce pollution. Best of all, it costs taxpayers almost nothing to do it right as opposed to a fortune doing it wrong.

That's tinkering - and I'm in favour of it. It makes sense to me. Because it takes peoples safety, as a priority, rather than money. Trouble is, the foxes are looking after chicken coop.

I appreciate philosophy is different to economics!!

 

[Danoff]

That's tinkering - and I'm in favour of it. It makes sense to me. Because it takes peoples safety, as a priority, rather than money. Trouble is, the foxes are looking after chicken coop.

I appreciate philosophy is different to economics!!

It's not economic tinkering so much as it is streamlining the judicial process in favor of human rights. The way I see it, pollution is potentially a violation of rights. When someone dumps something harmful onto your land, into your water, or into your air, they are directly harming you - which is a violation of your rights. If the judicial process is not well oiled for handling those sorts of things (which ours is not) then it needs "tinkering" to make it more consistent with its charter, the protection of rights.

 

[GTracer98]

What I find annoying is that the US hates socialism. But if you look at the statistics, the countries with the lowest rate of poverty and best living conditions are those which practise some of the socialistic ideas. Not all, I'm not saying communism is the way to go, we've all seen it isn't, but outright capitalism isn't good either.

 

[Famine]

Not all, I'm not saying communism is the way to go, we've all seen it isn't, but outright capitalism isn't good either.

It's never been tried, so that's an odd conclusion.

 

[GTracer98]

It's never been tried, so that's an odd conclusion.

It hasn't been tried because it's impossible, the Soviet Union was an example.

 

[Famine]

It hasn't been tried because it's impossible, the Soviet Union was an example.

Uhh... that's communism. Communism has been tried many, many times and always failed.

Free market capitalism has never been tried. No-one's even attempted anything like it.

 

[GTracer98]

Uhh... that's communism. Communism has been tried many, many times and always failed.

Free market capitalism has never been tried. No-one's even attempted anything like it.

Oh, I thought you meant the other way around.

Communism has been tried but has never worked out because it's impossible. So actual communism as written in the Communist Manifesto hasn't been achieved.

Free-market capitalism, yes, it hasn't been tried. And it would be interesting to see it in action. But if trade would be completely free from government regulations, wouldn't that lead to problems? Like, health care which wouldn't be free?

We need a system that would make all people equally wealthy. Or one that gives a chance to everyone. In that video about Ayrton Senna, they said that Senna felt bad for being the one with the money and possibility to become a racer. he felt it was incorrect that only some people have the chance to do what they want. That is called a money controlled society.

"The physical order of nature is a harmonious and self-regulating system." - isn't that a bit of anarchy?

 

[niky]

If people all have equal economic output, then they will all be equally wealthy, and you won't need a capitalist system. Every person will be able to grow, cook, formulate, fabricate or build anything and everything they need.

But not everyone is equal. Not by a longshot. Which is why we have economic activity. And why we have inequality.

You can reset it. Set everyone to zero, and have them rebuild from the ground up. Within less than a generation, you will have an income gap, as there will be those who specialize in certain products and who will excel at making them.

If you rely on those who excel at providing these services being completely altruistic, then they will not be able to develop their businesses beyond a small customer base, and will eventually be outproduced by those with business savvy who expand production and achieve lower costs and higher sales.

Within two or three generations, you will have those who are born to rich parents and those who are born to poor parents. Within less than a hundred years, you will have the same issues of inequality you had in the first place... unless you disincentivize excess productivity and creativity. Which means disincentivizing progress.

You can make the system fairer by preventing copyright extensions from extending so far into the future (as Disney has lobbied for) or by removing unfair subsidies and selective laws which are tailor made to favor certain industries over others. But in the end, unless you strip away all rights to property and prosperity, you can't keep everyone equal forever.

 

[GTracer98]

If people all have equal economic output, then they will all be equally wealthy, and you won't need a capitalist system. Every person will be able to grow, cook, formulate, fabricate or build anything and everything they need.

But not everyone is equal. Not by a longshot. Which is why we have economic activity. And why we have inequality.

You can reset it. Set everyone to zero, and have them rebuild from the ground up. Within less than a generation, you will have an income gap, as there will be those who specialize in certain products and who will excel at making them. Within two or three generations, you will have those who are born to rich parents and those who are born to poor parents. Within less than a hundred years, you will have the same issues of inequality you had in the first place... unless you disincentivize excess productivity and creativity. Which means disincentivizing progress.

You can make the system fairer by preventing copyright extensions from extending so far into the future (as Disney has lobbied for) or by removing unfair subsidies and selective laws which are tailor made to favor certain industries over others. But in the end, unless you strip away all rights to property and prosperity, you can't keep everyone equal forever.

If not equal, then at least above the poverty zone. At least in such a way that everyone has a shelter and food.

 

[Zenith]

What I find annoying is that the US hates socialism. But if you look at the statistics, the countries with the lowest rate of poverty and best living conditions are those which practise some of the socialistic ideas. Not all, I'm not saying communism is the way to go, we've all seen it isn't, but outright capitalism isn't good either.

They also tend to be ones who have nowhere near the same amount of population, diversity, and industry as the less socialist countries.

It's almost as if the people who generate wealth and industry would rather avoid places where they'd have to carry the burden of other people's livelihoods.

 

[niky]

Providing shelter and food to everyone is certainly possible. If countries didn't exist and there were no political, cultural or logistical barriers to moving all those people to temperate regions with fewer disasters.

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Providing food, shelter and adequate health care (vaccination, access to emergency services / surgery / diagnostics), that's a much bigger problem. And then there's the need to generate enough excess wealth and food/medicine/building supplies/etcetera to see those people through disasters that will come anyway (crop failures, freak weather, etcetera).

Also, it would be nice if we could set aside a few trillion dollars a year towards researching interplanetary travel and terraforming. Because we're going to have to bug out within the next few million years anyway...