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PostPosted: Fri Aug 31, 2012 12:23 pm
 


Brenda Brenda:
Well, I heard Romney promise that there would be jobs for everyone who wants to work when he gets into office. He said "12 million jobs" (last time I checked, unemployment was higher than that, but hey, what do I know), so I take it that he means that everyone who DOESn't work by the time he gets out of office, does not WANT to work.

I don't recall him say "full time jobs" or "jobs that give you enough hours/wage to feed your family a decent meal from" tho.

I guess being able to work 4 hours a week is "a job" too.


Any politician promising jobs is just blowing smoke up your ass. :lol: We see that all the time here as well.


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PostPosted: Fri Aug 31, 2012 12:44 pm
 


2Cdo 2Cdo:
Brenda Brenda:
Well, I heard Romney promise that there would be jobs for everyone who wants to work when he gets into office. He said "12 million jobs" (last time I checked, unemployment was higher than that, but hey, what do I know), so I take it that he means that everyone who DOESn't work by the time he gets out of office, does not WANT to work.

I don't recall him say "full time jobs" or "jobs that give you enough hours/wage to feed your family a decent meal from" tho.

I guess being able to work 4 hours a week is "a job" too.


Any politician promising jobs is just blowing smoke up your ass. :lol: We see that all the time here as well.

:lol:
I know, right? I just find it very funny that he is promising it while in the same sentence, he bashes Obama over job creation :P


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PostPosted: Fri Aug 31, 2012 2:59 pm
 


I like how Republicans r talkin about Jobs again, just like before the Mid-term elections. Last time they made gains, then did SFA about "Jobs" afterwards.


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PostPosted: Fri Aug 31, 2012 5:38 pm
 


CanadianJeff CanadianJeff:
Or it may very well be that's partly what happens with trickle down economics when you keep giving tax breaks to the rich while spending more and raise taxes on the poor by making sure the tax code allows more breaks for certain types of people.

If you going to call something a fallacy be ready to present what you view as the faulty reasoning. I think that kind of thinking is a direct result of bloated government with a bloated tax code.


Here's a list of how the rich got rich and if you note it doesn't mention off the backs of the middle and low income tax contributors as one of the main reasons.

Top 10 Industries Producing U.S. Billionaires

1. Investments: 100 billionaires
2. Technology: 51 billionaires
3. Media: 37
4. Energy: 35
5. Food and Beverage*: 31
5. Service*: 31
7. Fashion and Retail: 28
8. Real Estate: 27
9. Manufacturing: 18
10. Sports: 15

http://www.forbes.com/sites/erincarlyle ... -get-rich/

This whole fallacy about people with money are making it off the backs of the poor goes back to the era of the Robber Barons which is an inaccurate portrayal that persists to today.

$1:
It is a staple of history books to attach this derogatory phrase to such figures as John D. Rockefeller, Cornelius Vanderbilt, and the great nineteenth-century railroad operators — Grenville Dodge, Leland Stanford, Henry Villard, James J. Hill, and others. To most historians writing on this period, these entrepreneurs committed thinly veiled acts of larceny to enrich themselves at the expense of their customers. Once again we see the image of the greedy, exploitative capitalist, but in many cases this is a distortion of the truth.


http://mises.org/daily/2317/

I guess it'll always be easier to call someone a criminal because of his station in life rather than getting off your own ass and working for the things he has.


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PostPosted: Sat Sep 01, 2012 4:34 am
 


Well I'm up early this morning so why not play ball before coffee :P

First of all your trying to paint those who disagree with you as somehow hating the rich and just being some form of bitter and enraged person with no job and little wealth. This is purely and totally false. It's poisoning the well and if you don't think the majority can't see through the bullshit your kidding yourself. If you don't know why someone disagrees with your position it may be better to ask then try to paint someone as something they are not.


1. If you seriously can't see the problem with investors making billions off companies who employ people at 10 or 12 dollars and hour then I don't even know if I should be wasting my time. There is nothing wrong with an investor making a great return on an investment at all. It's why they make the investment in the first place but there is far too large a gap between the workers who get the business running and maintained and those who sit around in a boardroom and review numbers to decide where to place the next small risk.

2. Again it's the same damn issue as above but often with overseas factories. If you have been following the news at all lately this has been coming up a lot. Apple likely being the most infamous at the moment.

3. This one is hit or miss really. I think most newscasters do their best to stay neutral and provide the best factual information they can. Unless of course your Fox or msnbc.

4. Do I even need to say anything about how corrupt the energy industry is? Seriously? Quite possibly the only industry I've seen where if your competitor raises his prices you raise yours to match.

5. Yay billions off the backs of teenagers working a soul crushing job getting paid minimum wage. I can't help but feel really bad when I see adults working behind the counter.

6. See 1 and 5.

7. Again retail workers make billions for a select few while getting paid shit.

8. An honest industry in most circumstances. Problem is you need money to make money for this one. This is likely more millionaires becoming billionaires then anything else.

9. Have you ever worked on an assembly line? Go try it sometime and get back to me on how it felt.

10. Well we have one on the list that pays fairly for the product. Seriously most of the players go through hell to get picked up by a team. They earned the millions if people want to pay it.

You know just as well as I do I'm sure that ruthless win at all costs behavior is rewarded in the business world. Also don't pretend that you don't need money to make money in today's world.

I have no problem with people who work hard getting ahead. I'm glad I worked as hard as I did in my early 20s to get to this point in my life. However this is about those who don't come from backgrounds stable or wealthy enough to get that honest opportunity. People who will make only a few million over the course of their lives while their bosses earn billions.

Maybe some of us think it's ok if those people only earn a few hundred million if we can ensure instead that anyone can go to school and maybe start a small business of their own off the taxes of a box store billionaire.

I'm sure he would survive on 500 million instead of 1 billion.


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PostPosted: Sat Sep 01, 2012 7:06 am
 


Wrote this in the morning on little sleep. If it offends anyone, it really wasn't my intention.

$1:
I should have worded my response better, my bad. I was referring to the oringinal article. It states that the bottom 50% of earners paid only 3% of income tax revenues.So we are are talking about earners here, not children or dependents. Half of the people earning a living in the States are paying 3% of the income taxes. 47% of the people who are working in the U.S. are paying no federal income taxes. That is no way that is going to work.


If 50% of your workers own 3% of all wealth, then that 3% of tax revenues sounds remarkably fair. The unfortunate bit about using these statistics is that they often need a great amount of context to be used most effectively, imo.

The actual values as of 2009 were 2.25% of tax revenue coming from people making about 32,000 dollars or less. This tax is being placed on a group that holds 1% of the wealth, according to the congressional research service. The fact that 50% of the population holds so little of the wealth should be important for two reasons -- it readily identifies why the bottom half contributes so little, and it also identifies why people are so bugged by an absolute refusal to raise taxes even a bit on the rich. The assumption that there is not already mass swaths of capital available to the highest class of American citizens fails on the most basic level as a result -- tens, if not hundreds of billions of dollars are sitting there, while American is waiting for this investment or buying of goods that is supposed to stimulate an economy. For decades.

Income for the lowest group is 13% of the total amount. That means, out of the economy of the United States, 50% of people get 13% of the income to work with. This is the group persistently targeted by the right wing in America for not paying enough of their dues, when they have to pay out of a due that is far less than the top 1% of Americans get (17% of all income). Hence, the question for many, is why we don't raise taxes a wee bit on 17% rather than on the 13% amount?

(note: income is a stream of money coming in, wealth is a stock of all income attained and held, in case anyone is confused)

Let's assume, for a moment, that no one on the bottom half has dependents, that none of them have medical issues, that healthy food is readily affordable, rent can be met with ease, they are not paying off student loans, they are not students, and they are not teenagers. Let's also remove all ongoing payments for insurance and basic utilities. Gas in any form is free. So are cars. Finally, let's assume they can derive satisfaction purely from living some place and do not require new clothes or entertainment frequently.

Taking those assumptions, we can now tax them, say, 10% more than normal. Sounds like a nice flat tax rate. The amount of money you feel the country needs committed to it for it to survive is 1.3% of all income. We could have gained the same amount of money from the rich using a smaller increase. An increase that works without any of the above assumptions, that does not impinge someones ability to live, and cuts into money that isn't circulating, rather than cutting into the basic necessities of people who would have spent money anyways.

There is a simplified version of an economic ideal widely known as the velocity theory of money. This theory when simplified is as followed -- the economy's strength is proportional to the amount of time money changes hands. It's a supporting principle of the need for consumption of goods and services to drive an economy. A single dollar, changing hands numerous times, to create goods, pay wages, buy textiles and so forth, will do more for an economy than 40 or 50 dollars sitting around doing nothing. The bottom 50% already pay the majority of what they get back into the system, to get everything from a roof over their head to a bus pass. Giving them more money will almost certainly be used to buy something, or to get education, improve their way of life, and so forth.

The rich have a higher propensity to save because they have, in part, a higher ability to save. The proportion of their income necessary to live and derive satisfaction of life is far lower than those in the bottom 50%. To be in the top 1%, incidentally, your income alone has to be 10 times that of the richest at the bottom of the 50%, and a great many people are far more wealthy than that. This pushes the concept of 1% well above most doctors, vets, and so forth. Reducing and replacing tax revenue from other levels and garnering it from here, where the money is less likely to be moved around or function in society, simply seems better from this point of view.

Keep in mind that money from taxes can be used to improve things like what is covered in health care, education spending, or subsidies for small businesses, all which improve the welfare of low income people while improving their chances at economic change, which will improve the overall health of the economy as a whole. Use of tax dollars to direct and improve the economy from the base up can only improve economic (and therefore societal) and individual wellbeing on the whole, imo. The utility of the money is hence far higher than it would have been, either sitting around gaining interest or used for minor pleasures of one individual.

The people in this income bracket have an extraordinary amount of power. The 1% drives the PACs, the investment, the politics and the ideals of the country. They make use of public property and rely on society as a whole to consume what goods and services they are providing. They also hold a massive amount of saved wealth in a time where social mobility has never been lower (as I will post later). It makes sense to me that they have a greater burden to pay because they take, use, and control a larger portion of the economy. The difference in 5% of tax for them is not the difference between eating bread and not.

It is very perverse in my view to equivocate eating breakfast every morning with being able to buy a brownstone in the Hamptons (assuming they buy anything at all). Especially if it's 50 people reducing their food intake to each 1 person buying the house, pre-made, from 1%-er to another 1%-er. I don't view that as fair.

$1:
I'm sorry but I have zero respect for the Gini index. It represents income redistribution. The last time I seen that list, it was headed by workers paradises like Cuba. I would never want my country to be at the top of such a list. No one ever got shot jumping over the wall into East Belin. I have never heard of the Cuban coast gaurd turning away a boatload of immigrants from America.


It represents income (in)equality. Unless you want to qualify Afghanistan's low number as "explosive redistribution of wealth" it doesn't represent that at all. Take Ethiopia's ranking out of context as a nation that is dirt poor during the worst drought in Africa in 60 years. These figures must be taken within proper context.

Indeed, Cuba, for example, is not ranked all that well -- most of the time, it's not on the top of the list at all, as the Gini index doesn't shine brightly on a regime where most of the people are poor and a small handful are rich. Estimates in 2000 had it at .38, and rising (http://www.reuters.com/article/2008/04/ ... nequality-
idUSN1033501920080410), 30 places behind Canada's current listing were it there. Given that most "worker's paradises" tend to be pseudo-"communist" dictatorships where the wealth is horded by a small elite, most such places tend to rank poorly. The top of the list is almost always exclusively the playground of places with a middle class, the drivers of economies -- ie, the "first world."

I doubt you will see a boatload from any of the top 10, or even top 30 nations on one of those lists (save the aforementioned Ethiopia/Afghanistan examples, the only two such nations before Canada on the list I'm reading), because the gini index tends to be representative of which nations have a strong middle class, and hence high economic growth and potential. It's also been tied heavily to everything from health of people through educational success, and even economic integrity or political polarization. Portugal and Italy (ranked last on more than one OECD-centric list), for example, don't rank well, before OR after tax figures. :P

The gini index does not require respect. All it is is a statistic. Having no respect for it is the same as having no respect for unemployment figures or your bank account balance. You might not respect how some use it but the figure is there to be used in proper context, and proper context shows that it is not encouraging us all to go communist.

As for equality... is it important?

Generational Endowments

First off, we must keep in mind that having money by no means avails you the title of Financial Master. There are many examples of people who inherit money through their parents, or grandparents, and no doubt some famous families in most of America's larger cities have played a role in this. How much of the holdings of the 1% are generational?

The problem is that this impacts the reward system, skewing where money goes, which supports perverse incentives and shifts prestigious position and money in favour of those with ready made support they have rather than earned (Hopkins and Kornienko, 2010). This has demonstrated negative impacts on the middle and low income classes, as they are forced into greater effort for reduced reward/compensation (Hopkins and Kornienko, 2010). Keep in mind that there are demonstrated issues with opportunity between groups as well, as those born with less have less with which to build their lives with (Abatemarco, 2010). The initial endowments are doing the poor no big favour either, even though the middle class benefits by some people gaining large initial endowments according to Hopkins and Kornienko -- probably because it allows them to move further money between families as well, if only to a lesser extent, in my own opinion (2010).

Where is the money?

I have to wonder if this money is being reinvested, or if it is just sitting there -- if money is doing nothing, then by the Velocity Theory of Money, it is not contributing to economic output at all.

The question in my mind is whether or not this money is being invested, how it is being invested, and where is it being invested. I don't know about you guys, but my family is maybe half invested in Canada and half invested elsewhere -- just because someone has money, does not mean they are keeping it within the nation or are even planning on using it here. To me, developing nations look to be delivering higher returns on my investment, and that is where my money is going.

Economic Expansion

The good of all depend on economic expansion, and I think by the ideals of the pie, people would agree. Hence, we should focus on maximizing our output to ensure the maximum amount of welfare out of the system, I should think, no?

The problem is that historical evidence and continued recent trends show that economic inequality is linked directly to lowered economic growth (Galbraith 2010... or one of the others). Recent samples show this trend continues (Vu and Mukhopadhaya, 2011). While this trend is more common in developing countries, the importance of the gini index in developed nations is still relevant as it also impacts us here. Hence, should we see increasing economic disparity, we will see decreased economic growth, which negatively impacts all involved, rich, middle class and poor.

Role in the Financial Crisis:

The rise in inequality in the last two decades has affected most developed economies. The systemic nature of this inequality is the focus of this paper. A combination of product market internationalization, financial globalization and technological changes favoring large organizations created asymmetric pressure on the two ends of the distribution of market incomes, resulting in greatly increased inequality. A widespread credo of political liberalism prevented governments from using taxes and transfers to check this rise in income inequality. Changes in relative prices and borrowing facilities brought some support to the standards of living of low-income groups but also contributed to increased instability of these economies. The global financial crisis was one of the possible crisis scenarios that rising inequality was bound to produce. The paper assesses the cumulative factors behind the rise in inequality. These factors reduce the capacity of industrial economies to face the challenges of ever-changing environments.

- Written by Petit (2010), Abstract of Paper "The Systemic Nature of the Rise in Inequality in Developed Economies"

Societal Implications:

Inequality has been linked to economic instability (Petit, 2010). An increase in inequality has also been shown to impact health negatively and increases the chances of family to be subject to environmental hazards (Currie, 2011). Note that health inequality does have robust evidence linking it to a lack of economic growth as well in developing countries (Grimm 2011). I would not be surprised to see this evidence mirrored, if not somewhat weaker, in developing countries. Inequality has been linked to polarization and conflict (Nunez and Tartakowsky, 2010). Also, it is significantly impacted by global monetary policy and commodity pricing (Galbraith 2010). I have to admit curiosity as to whether or not this makes economies more unstable since they are open to greater impacts from abroad.

Evidence also shows that there are poverty traps present with a constant feedback loop maintaining parts of the American populace in poor living conditions (Apergis et al., 2011). Apergis et al. discuss a bidirectional impact poverty and inequality have on each other within American society (2010). Hence, these results demonstrate that with inequality in the States comes some degree of poverty. Cities also show similar patterns to the national level, with high amounts of crime present in more unequal cities, as well as reduced economic growth and reduced population expansion (Glaeser et al., 2009).

Conclusions:

I would like to begin by stating that I am not condemning opposing positions entirely with this Devil's Advocate post, since perfect equality (whether or not such a thing is possible aside) does introduce a perverse incentive whether we are discussing incentives in financial or social terms. I would also like to state I recognize there are those who got rich for good reasons, and there are those who are wealthy who use their money not only responsibly, but in a fashion which is inspiring and beneficial to humanity.

However, I do feel there is significant enough evidence to conclude that increased inequality does cause economic harm in general, societal harm to many and even continued harm across generations to some. While I cannot provide a specific example, I am sure stories could be created which match what modern evidence in economic inequality suggest. Given this is a long running discussion as well, it is not as if this discussion is being driven purely based on the discussions going on today -- some of these papers discuss issues going back decades, and I also drew from old material from a Developing Econ course I took -- those materials are in the double digits of age today.

References:

Abatemarco, A 2010, 'Measuring Inequality of Opportunity through Between-Group Inequality Components', Journal Of Economic Inequality, 8, 4, pp. 475-490, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Currie, J 2011, 'Inequality at Birth: Some Causes and Consequences', American Economic Review, 101, 3, pp. 1-22, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Galbraith, JK 2011, 'Inequality and Economic and Political Change: A Comparative Perspective', Cambridge Journal Of Regions, Economy And Society, 4, 1, pp. 13-27, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Glaeser, E, Resseger, M, & Tobio, K 2009, 'Inequality in Cities', Journal Of Regional Science, 49, 4, pp. 617-646, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Grimm, M 2011, 'Does Inequality in Health Impede Economic Growth?', Oxford Economic Papers, 63, 3, pp. 448-474, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Hopkins, E, & Kornienko, T 2010, 'Which Inequality? The Inequality of Endowments versus the Inequality of Rewards', American Economic Journal: Microeconomics, 2, 3, pp. 106-137, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Nunez, J, & Tartakowsky, A 2011, 'The Relationship between Income Inequality and Inequality of Opportunities in a High-Inequality Country: The Case of Chile', Applied Economics Letters, 18, 4-6, pp. 359-369, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Petit, P 2010, 'The Systemic Nature of the Rise in Inequality in Developed Economies', International Review Of Applied Economics, 24, 3, pp. 251-267, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Vu, H, & Mukhopadhaya, P 2011, 'Reassessing the Relationship between Economic Growth and Inequality', Economic Papers, 30, 2, pp. 265-272, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

$1:
Okay, fine, Then the rich people don't buy a new house and the construction workers who would've built it lose their jobs. Or as we're seeing in Italy, the workers at Ferrari are losing their jobs as the wealthy can't afford such cars anymore. And the yacht builders are on the unemployment line. And the private jet builders and operators are going out of business, too. And who gets hurt the worst? Hint: It's not the wealthy.


The rich people do the most good for the country from one place -- behind a desk. This discussion isn't about the efficacy of corporate taxes, and hence doesn't enter into the area where they do the mass majority of the work they do in the economy. The richest of the rich are behind massive corporations where the corporation themselves drive their own investment and so forth, and don't depend on the private bank accounts of the CEOs. Hence, the largest amount of the efficacy of the rich is already irrelevant in this discussion.

I'd like to point out that you've made an excellent example for the defenders of tax raises on the rich, and that is where the money goes. The assumption that leaving money to the rich will improve the American economy is based on a number of assumptions which seem unrealistic to me.

The first is that they are going to buy American, and not on the Ferraris, or foreign-designed Yachts, or so forth. Most rich Americans own multiple homes, but also live in multiple countries. Why get away to pensioner land when you can wander off to Malta for a few weeks? Why buy that new high end ford when I can drive an Audi R8 or McLaren MPC4-12C to get extreme performance, driving them on more speed tolerant European roads? Why invest in American companies when I can invest in better performing ones elsewhere (I know I have!). It seems to me that money left to people who have the will and way to send money out the country won't be as efficacious. Especially when you are always on these people's cases when it comes to box stores like Wal-Mart or "sending jobs elsewhere."

The second is that those people in the Lamborghini factories are going to be paid more than people at Ford. The irony of it is that one Lamborghini might have double or triple the labour put into creating it, but one of those also costs ten times what a Ford does. Simply put, the idea that they are doing more for the economy by buying luxury goods than having a greater amount of money buying ordinary goods doesn't seem to balance right. You can pay the same guys to install high end Italian marble in your house, or those same guys could get ten times the work installing a low-end granite in a bunch of middle class homes. With luxury goods, you aren't so much paying for the end result of labour and raw goods into the economy as much as you are paying a "bandwagon" tax, a cost for wanting exclusivity in the market. You pay tons more for land on the beach because most people don't have beaches. You pay more to develop a mansion per square foot than a normal house because most people don't have one. Your Audi R8 costs so much more because it's exclusive and has performance most vehicles don't have. Comparatively, you aren't providing as much to the economy as you might be otherwise for the same amount of money.

The third is that capital flight isn't already happening. I think that if taxes are something that people want to avoid, a marginal increase on the rich rather than the poor won't change much. If people are going to avoid paying their taxes, they have the same incentive to do so at 20% as they do at 21% or 25%. It also makes the assumption that the rich are a drop of a hat away from leaving the services, companies, and lifestyle behind, as well as basically stating that being American doesn't mean anything to them. If keeping them around requires us to beg them to stay, they likely already are keeping and spending most of their money abroad. Have we truly seen an increase in tax revenues by reducing taxes on the rich? Did they actually let themselves be taxed when the tax cuts happened? This all presumes the rich are spending, and a famous saying among Scots is that the rich didn't get rich by spending.

Any marginal loss to capital flight that accompanies an increase of tax revenues and the potential benefits to people they bringing is acceptable, in my books. It's only when that flight is so significant that we can't garner more or the economy actually DOES falter that we have a problem, and I'm willing to bet most of the birdies people worry about flew south to the Canaries or East to the Swiss a long time ago.

If tax is reduced on the poor (including credit when it goes negative) then there well-being will improve, from health on through. Stating that the only way money can help these people is through the work the rich give them ignores a number of other alternative routes. The most obvious one being government spending, programs that help feed children who are in poverty across the united states or give grants to the gifted so they can go to a school. Seems to me like money from taxes can help the poor just as much.

And given the amount of money they are pulling in, they will likely buy the same things they would have otherwise. Keep in mind that the right keep a large amount of money in savings. An extra million dollars might not be used until a grandson inheritor decides he wants to spend it. Keep in mind, too, that the rich don't buy everything new, nor does the money go down at all times.

With taxes, 100% of the money is used and can be effected. It's also directed where it's needed, not by the hopes that it will get where it needs to go and at the right time depending on the willingness to spend on a certain good from a massively overprivledged minority of the population.

$1:
Second, the conservatives right now are not proposing more tax cuts, they're simply opposed to new tax increases.


Well, the platform put forth by the GOP has been "reduce rates and simplify." Evidence. They hope to make up the shortfall by cutting loopholes. Douglas Holtz-Eakin, a GOP policy-driver at Tampa, has actually stated that regaining economic confidence requires "across-the-board tax cuts." Romney stated that business taxes are going to be reduced. These plans also include cutting marginal rates by 20 percent, repealing the estate tax and the Alternative Minimum Tax, and eliminating taxes on investment income for low- and moderate-income households. It really sounds like tax cuts to me?

One could also argue that pushing for the Bush Tax Cuts to continue was also a sign of supporting tax cuts, but that could also be considered semantic.


Last edited by Khar on Sat Sep 01, 2012 7:40 am, edited 3 times in total.

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R=UP +5


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Good stuff from Khar. One quibble: before the crash things were booming in the US since Clinton, yet inequality rose. A rising tide raised some boats way more than others, it wasn't a level tide.

As to inequality, both of you are against higher minimum wages. What, let's have greater income equality for middle class and up, but not the poorest workers? If, a la Khar, you want to have an income redistribution scheme for these lowest paid workers, where the govt just gives them money taken from the better off, that's fine, but really sounds like a business subsidy to me. Either way, you can't moan about income inequality on the one hand and say fuck you to the most unequal on the other.

Yes, the 1% have the most wealth and should pay higher taxes. But the amount of taxes needed means that everybody from the middle class up should pay more, just that highest marginal tax rate increases should of course be for the highest earners. We've all been paying too little tax for the services we want from the govt. I guess Shep will squeal how he's not rich with his 98k and all, but he's at twice the median wage. Certainly anybody at the median wage or up should pay more tax. Raising taxes a bit for people over 200k, Obama wants to do is going to bring in diddly squat for the deficit.


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Khar Khar:
Wrote this in the morning on little sleep. If it offends anyone, it really wasn't my intention.

$1:
I should have worded my response better, my bad. I was referring to the oringinal article. It states that the bottom 50% of earners paid only 3% of income tax revenues.So we are are talking about earners here, not children or dependents. Half of the people earning a living in the States are paying 3% of the income taxes. 47% of the people who are working in the U.S. are paying no federal income taxes. That is no way that is going to work.


If 50% of your workers own 3% of all wealth, then that 3% of tax revenues sounds remarkably fair. The unfortunate bit about using these statistics is that they often need a great amount of context to be used most effectively, imo.

The actual values as of 2009 were 2.25% of tax revenue coming from people making about 32,000 dollars or less. This tax is being placed on a group that holds 1% of the wealth, according to the congressional research service. The fact that 50% of the population holds so little of the wealth should be important for two reasons -- it readily identifies why the bottom half contributes so little, and it also identifies why people are so bugged by an absolute refusal to raise taxes even a bit on the rich. The assumption that there is not already mass swaths of capital available to the highest class of American citizens fails on the most basic level as a result -- tens, if not hundreds of billions of dollars are sitting there, while American is waiting for this investment or buying of goods that is supposed to stimulate an economy. For decades.

Income for the lowest group is 13% of the total amount. That means, out of the economy of the United States, 50% of people get 13% of the income to work with. This is the group persistently targeted by the right wing in America for not paying enough of their dues, when they have to pay out of a due that is far less than the top 1% of Americans get (17% of all income). Hence, the question for many, is why we don't raise taxes a wee bit on 17% rather than on the 13% amount?

(note: income is a stream of money coming in, wealth is a stock of all income attained and held, in case anyone is confused)

Let's assume, for a moment, that no one on the bottom half has dependents, that none of them have medical issues, that healthy food is readily affordable, rent can be met with ease, they are not paying off student loans, they are not students, and they are not teenagers. Let's also remove all ongoing payments for insurance and basic utilities. Gas in any form is free. So are cars. Finally, let's assume they can derive satisfaction purely from living some place and do not require new clothes or entertainment frequently.

Taking those assumptions, we can now tax them, say, 10% more than normal. Sounds like a nice flat tax rate. The amount of money you feel the country needs committed to it for it to survive is 1.3% of all income. We could have gained the same amount of money from the rich using a smaller increase. An increase that works without any of the above assumptions, that does not impinge someones ability to live, and cuts into money that isn't circulating, rather than cutting into the basic necessities of people who would have spent money anyways.

There is a simplified version of an economic ideal widely known as the velocity theory of money. This theory when simplified is as followed -- the economy's strength is proportional to the amount of time money changes hands. It's a supporting principle of the need for consumption of goods and services to drive an economy. A single dollar, changing hands numerous times, to create goods, pay wages, buy textiles and so forth, will do more for an economy than 40 or 50 dollars sitting around doing nothing. The bottom 50% already pay the majority of what they get back into the system, to get everything from a roof over their head to a bus pass. Giving them more money will almost certainly be used to buy something, or to get education, improve their way of life, and so forth.

The rich have a higher propensity to save because they have, in part, a higher ability to save. The proportion of their income necessary to live and derive satisfaction of life is far lower than those in the bottom 50%. To be in the top 1%, incidentally, your income alone has to be 10 times that of the richest at the bottom of the 50%, and a great many people are far more wealthy than that. This pushes the concept of 1% well above most doctors, vets, and so forth. Reducing and replacing tax revenue from other levels and garnering it from here, where the money is less likely to be moved around or function in society, simply seems better from this point of view.

Keep in mind that money from taxes can be used to improve things like what is covered in health care, education spending, or subsidies for small businesses, all which improve the welfare of low income people while improving their chances at economic change, which will improve the overall health of the economy as a whole. Use of tax dollars to direct and improve the economy from the base up can only improve economic (and therefore societal) and individual wellbeing on the whole, imo. The utility of the money is hence far higher than it would have been, either sitting around gaining interest or used for minor pleasures of one individual.

The people in this income bracket have an extraordinary amount of power. The 1% drives the PACs, the investment, the politics and the ideals of the country. They make use of public property and rely on society as a whole to consume what goods and services they are providing. They also hold a massive amount of saved wealth in a time where social mobility has never been lower (as I will post later). It makes sense to me that they have a greater burden to pay because they take, use, and control a larger portion of the economy. The difference in 5% of tax for them is not the difference between eating bread and not.

It is very perverse in my view to equivocate eating breakfast every morning with being able to buy a brownstone in the Hamptons (assuming they buy anything at all). Especially if it's 50 people reducing their food intake to each 1 person buying the house, pre-made, from 1%-er to another 1%-er. I don't view that as fair.

$1:
I'm sorry but I have zero respect for the Gini index. It represents income redistribution. The last time I seen that list, it was headed by workers paradises like Cuba. I would never want my country to be at the top of such a list. No one ever got shot jumping over the wall into East Belin. I have never heard of the Cuban coast gaurd turning away a boatload of immigrants from America.


It represents income (in)equality. Unless you want to qualify Afghanistan's low number as "explosive redistribution of wealth" it doesn't represent that at all. Take Ethiopia's ranking out of context as a nation that is dirt poor during the worst drought in Africa in 60 years. These figures must be taken within proper context.

Indeed, Cuba, for example, is not ranked all that well -- most of the time, it's not on the top of the list at all, as the Gini index doesn't shine brightly on a regime where most of the people are poor and a small handful are rich. Estimates in 2000 had it at .38, and rising (http://www.reuters.com/article/2008/04/ ... nequality-
idUSN1033501920080410), 30 places behind Canada's current listing were it there. Given that most "worker's paradises" tend to be pseudo-"communist" dictatorships where the wealth is horded by a small elite, most such places tend to rank poorly. The top of the list is almost always exclusively the playground of places with a middle class, the drivers of economies -- ie, the "first world."

I doubt you will see a boatload from any of the top 10, or even top 30 nations on one of those lists (save the aforementioned Ethiopia/Afghanistan examples, the only two such nations before Canada on the list I'm reading), because the gini index tends to be representative of which nations have a strong middle class, and hence high economic growth and potential. It's also been tied heavily to everything from health of people through educational success, and even economic integrity or political polarization. Portugal and Italy (ranked last on more than one OECD-centric list), for example, don't rank well, before OR after tax figures. :P

The gini index does not require respect. All it is is a statistic. Having no respect for it is the same as having no respect for unemployment figures or your bank account balance. You might not respect how some use it but the figure is there to be used in proper context, and proper context shows that it is not encouraging us all to go communist.

As for equality... is it important?

Generational Endowments

First off, we must keep in mind that having money by no means avails you the title of Financial Master. There are many examples of people who inherit money through their parents, or grandparents, and no doubt some famous families in most of America's larger cities have played a role in this. How much of the holdings of the 1% are generational?

The problem is that this impacts the reward system, skewing where money goes, which supports perverse incentives and shifts prestigious position and money in favour of those with ready made support they have rather than earned (Hopkins and Kornienko, 2010). This has demonstrated negative impacts on the middle and low income classes, as they are forced into greater effort for reduced reward/compensation (Hopkins and Kornienko, 2010). Keep in mind that there are demonstrated issues with opportunity between groups as well, as those born with less have less with which to build their lives with (Abatemarco, 2010). The initial endowments are doing the poor no big favour either, even though the middle class benefits by some people gaining large initial endowments according to Hopkins and Kornienko -- probably because it allows them to move further money between families as well, if only to a lesser extent, in my own opinion (2010).

Where is the money?

I have to wonder if this money is being reinvested, or if it is just sitting there -- if money is doing nothing, then by the Velocity Theory of Money, it is not contributing to economic output at all.

The question in my mind is whether or not this money is being invested, how it is being invested, and where is it being invested. I don't know about you guys, but my family is maybe half invested in Canada and half invested elsewhere -- just because someone has money, does not mean they are keeping it within the nation or are even planning on using it here. To me, developing nations look to be delivering higher returns on my investment, and that is where my money is going.

Economic Expansion

The good of all depend on economic expansion, and I think by the ideals of the pie, people would agree. Hence, we should focus on maximizing our output to ensure the maximum amount of welfare out of the system, I should think, no?

The problem is that historical evidence and continued recent trends show that economic inequality is linked directly to lowered economic growth (Galbraith 2010... or one of the others). Recent samples show this trend continues (Vu and Mukhopadhaya, 2011). While this trend is more common in developing countries, the importance of the gini index in developed nations is still relevant as it also impacts us here. Hence, should we see increasing economic disparity, we will see decreased economic growth, which negatively impacts all involved, rich, middle class and poor.

Role in the Financial Crisis:

The rise in inequality in the last two decades has affected most developed economies. The systemic nature of this inequality is the focus of this paper. A combination of product market internationalization, financial globalization and technological changes favoring large organizations created asymmetric pressure on the two ends of the distribution of market incomes, resulting in greatly increased inequality. A widespread credo of political liberalism prevented governments from using taxes and transfers to check this rise in income inequality. Changes in relative prices and borrowing facilities brought some support to the standards of living of low-income groups but also contributed to increased instability of these economies. The global financial crisis was one of the possible crisis scenarios that rising inequality was bound to produce. The paper assesses the cumulative factors behind the rise in inequality. These factors reduce the capacity of industrial economies to face the challenges of ever-changing environments.

- Written by Petit (2010), Abstract of Paper "The Systemic Nature of the Rise in Inequality in Developed Economies"

Societal Implications:

Inequality has been linked to economic instability (Petit, 2010). An increase in inequality has also been shown to impact health negatively and increases the chances of family to be subject to environmental hazards (Currie, 2011). Note that health inequality does have robust evidence linking it to a lack of economic growth as well in developing countries (Grimm 2011). I would not be surprised to see this evidence mirrored, if not somewhat weaker, in developing countries. Inequality has been linked to polarization and conflict (Nunez and Tartakowsky, 2010). Also, it is significantly impacted by global monetary policy and commodity pricing (Galbraith 2010). I have to admit curiosity as to whether or not this makes economies more unstable since they are open to greater impacts from abroad.

Evidence also shows that there are poverty traps present with a constant feedback loop maintaining parts of the American populace in poor living conditions (Apergis et al., 2011). Apergis et al. discuss a bidirectional impact poverty and inequality have on each other within American society (2010). Hence, these results demonstrate that with inequality in the States comes some degree of poverty. Cities also show similar patterns to the national level, with high amounts of crime present in more unequal cities, as well as reduced economic growth and reduced population expansion (Glaeser et al., 2009).

Conclusions:

I would like to begin by stating that I am not condemning opposing positions entirely with this Devil's Advocate post, since perfect equality (whether or not such a thing is possible aside) does introduce a perverse incentive whether we are discussing incentives in financial or social terms. I would also like to state I recognize there are those who got rich for good reasons, and there are those who are wealthy who use their money not only responsibly, but in a fashion which is inspiring and beneficial to humanity.

However, I do feel there is significant enough evidence to conclude that increased inequality does cause economic harm in general, societal harm to many and even continued harm across generations to some. While I cannot provide a specific example, I am sure stories could be created which match what modern evidence in economic inequality suggest. Given this is a long running discussion as well, it is not as if this discussion is being driven purely based on the discussions going on today -- some of these papers discuss issues going back decades, and I also drew from old material from a Developing Econ course I took -- those materials are in the double digits of age today.

References:

Abatemarco, A 2010, 'Measuring Inequality of Opportunity through Between-Group Inequality Components', Journal Of Economic Inequality, 8, 4, pp. 475-490, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Currie, J 2011, 'Inequality at Birth: Some Causes and Consequences', American Economic Review, 101, 3, pp. 1-22, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Galbraith, JK 2011, 'Inequality and Economic and Political Change: A Comparative Perspective', Cambridge Journal Of Regions, Economy And Society, 4, 1, pp. 13-27, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Glaeser, E, Resseger, M, & Tobio, K 2009, 'Inequality in Cities', Journal Of Regional Science, 49, 4, pp. 617-646, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Grimm, M 2011, 'Does Inequality in Health Impede Economic Growth?', Oxford Economic Papers, 63, 3, pp. 448-474, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Hopkins, E, & Kornienko, T 2010, 'Which Inequality? The Inequality of Endowments versus the Inequality of Rewards', American Economic Journal: Microeconomics, 2, 3, pp. 106-137, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Nunez, J, & Tartakowsky, A 2011, 'The Relationship between Income Inequality and Inequality of Opportunities in a High-Inequality Country: The Case of Chile', Applied Economics Letters, 18, 4-6, pp. 359-369, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Petit, P 2010, 'The Systemic Nature of the Rise in Inequality in Developed Economies', International Review Of Applied Economics, 24, 3, pp. 251-267, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

Vu, H, & Mukhopadhaya, P 2011, 'Reassessing the Relationship between Economic Growth and Inequality', Economic Papers, 30, 2, pp. 265-272, EconLit with Full Text, EBSCOhost, viewed 8 November 2011.

$1:
Okay, fine, Then the rich people don't buy a new house and the construction workers who would've built it lose their jobs. Or as we're seeing in Italy, the workers at Ferrari are losing their jobs as the wealthy can't afford such cars anymore. And the yacht builders are on the unemployment line. And the private jet builders and operators are going out of business, too. And who gets hurt the worst? Hint: It's not the wealthy.


The rich people do the most good for the country from one place -- behind a desk. This discussion isn't about the efficacy of corporate taxes, and hence doesn't enter into the area where they do the mass majority of the work they do in the economy. The richest of the rich are behind massive corporations where the corporation themselves drive their own investment and so forth, and don't depend on the private bank accounts of the CEOs. Hence, the largest amount of the efficacy of the rich is already irrelevant in this discussion.

I'd like to point out that you've made an excellent example for the defenders of tax raises on the rich, and that is where the money goes. The assumption that leaving money to the rich will improve the American economy is based on a number of assumptions which seem unrealistic to me.

The first is that they are going to buy American, and not on the Ferraris, or foreign-designed Yachts, or so forth. Most rich Americans own multiple homes, but also live in multiple countries. Why get away to pensioner land when you can wander off to Malta for a few weeks? Why buy that new high end ford when I can drive an Audi R8 or McLaren MPC4-12C to get extreme performance, driving them on more speed tolerant European roads? Why invest in American companies when I can invest in better performing ones elsewhere (I know I have!). It seems to me that money left to people who have the will and way to send money out the country won't be as efficacious. Especially when you are always on these people's cases when it comes to box stores like Wal-Mart or "sending jobs elsewhere."

The second is that those people in the Lamborghini factories are going to be paid more than people at Ford. The irony of it is that one Lamborghini might have double or triple the labour put into creating it, but one of those also costs ten times what a Ford does. Simply put, the idea that they are doing more for the economy by buying luxury goods than having a greater amount of money buying ordinary goods doesn't seem to balance right. You can pay the same guys to install high end Italian marble in your house, or those same guys could get ten times the work installing a low-end granite in a bunch of middle class homes. With luxury goods, you aren't so much paying for the end result of labour and raw goods into the economy as much as you are paying a "bandwagon" tax, a cost for wanting exclusivity in the market. You pay tons more for land on the beach because most people don't have beaches. You pay more to develop a mansion per square foot than a normal house because most people don't have one. Your Audi R8 costs so much more because it's exclusive and has performance most vehicles don't have. Comparatively, you aren't providing as much to the economy as you might be otherwise for the same amount of money.

The third is that capital flight isn't already happening. I think that if taxes are something that people want to avoid, a marginal increase on the rich rather than the poor won't change much. If people are going to avoid paying their taxes, they have the same incentive to do so at 20% as they do at 21% or 25%. It also makes the assumption that the rich are a drop of a hat away from leaving the services, companies, and lifestyle behind, as well as basically stating that being American doesn't mean anything to them. If keeping them around requires us to beg them to stay, they likely already are keeping and spending most of their money abroad. Have we truly seen an increase in tax revenues by reducing taxes on the rich? Did they actually let themselves be taxed when the tax cuts happened? This all presumes the rich are spending, and a famous saying among Scots is that the rich didn't get rich by spending.

Any marginal loss to capital flight that accompanies an increase of tax revenues and the potential benefits to people they bringing is acceptable, in my books. It's only when that flight is so significant that we can't garner more or the economy actually DOES falter that we have a problem, and I'm willing to bet most of the birdies people worry about flew south to the Canaries or East to the Swiss a long time ago.

If tax is reduced on the poor (including credit when it goes negative) then there well-being will improve, from health on through. Stating that the only way money can help these people is through the work the rich give them ignores a number of other alternative routes. The most obvious one being government spending, programs that help feed children who are in poverty across the united states or give grants to the gifted so they can go to a school. Seems to me like money from taxes can help the poor just as much.

And given the amount of money they are pulling in, they will likely buy the same things they would have otherwise. Keep in mind that the right keep a large amount of money in savings. An extra million dollars might not be used until a grandson inheritor decides he wants to spend it. Keep in mind, too, that the rich don't buy everything new, nor does the money go down at all times.

With taxes, 100% of the money is used and can be effected. It's also directed where it's needed, not by the hopes that it will get where it needs to go and at the right time depending on the willingness to spend on a certain good from a massively overprivledged minority of the population.

$1:
Second, the conservatives right now are not proposing more tax cuts, they're simply opposed to new tax increases.


Well, the platform put forth by the GOP has been "reduce rates and simplify." Evidence. They hope to make up the shortfall by cutting loopholes. Douglas Holtz-Eakin, a GOP policy-driver at Tampa, has actually stated that regaining economic confidence requires "across-the-board tax cuts." Romney stated that business taxes are going to be reduced. These plans also include cutting marginal rates by 20 percent, repealing the estate tax and the Alternative Minimum Tax, and eliminating taxes on investment income for low- and moderate-income households. It really sounds like tax cuts to me?

One could also argue that pushing for the Bush Tax Cuts to continue was also a sign of supporting tax cuts, but that could also be considered semantic.

First off, I don't think you should ever have to appologize for offending anyone with your ideas. I know you are just being polite, but these forums are all about the free exchange of ideas. Whether I agree or disagree with someone's veiwpoint, I will always defend their right to voice their opinion on a subject. I have always admired your work. Of all the forums that I visit, I find your work to be in the top 5%. You always provide well thought out posts, even if I don't always agree with your ideas. Just like I have read every book by Al Frankin, I always enjoy your work. I consider it an honor to spar with you. I just wish you had caught me on a better day. You responded to multiple posters in your post. I will only respond to the parts that refer to me. I posses neither your eloquence, or wit. So get ready for a rough read on your part. You state that 50% of my country's workers own 3% of our wealth. That is not what I said. I was talking about federal income tax. I could own millions of acres of land. If I am not making a profit on those lands, I have no federal income tax on that property. Smart people own many homes, or apartment complexes. As long as the tenets are mearly paying the mortgage and upkeep, there is no profit. Thus, no federal income tax. I could invest in certain tax advantagable things like oil exploration, make a great income and pay no taxes whatsoever.Many master limited parternerships are paying upwards of 8%, with no federal income tax. What someone owns, and what they owe as federal taxable income are two very different things. I am stating that 47% of people who have earned income, pay no federal income tax. Think about that number for a moment. Almost half the people in the U.S who have income, pay no income tax. What if it were the top 50% that was not paying? What would the reaction be? They could put all their money in MLP'S, municipal bonds, oil exploration,etc. They could buy up all the real estate, and wait to cash out 30 years later.

You state that 2.25% of our tax revenue comes from people making $32,000 or less. That just tells me that the rich are paying most of the taxes. What would that rate be in Canada? I would bet that the rate of revenue for people making $32,000 is higher in Canada. I could be wrong. Prove me wrong. I make about $60,000 in income from wages at my job. My income from the stock market is all over the map. Win some,lose some. I can't remember the last time I was below the 25% tax bracket. What about two single people living together, making $35,000 a piece. Are they paying any taxes? Supposedly they are in the 15% tax bracket. They are doing 10% better than me right off the bat by being single. A few tweaks here and there, and they pay nothing. They might get the earned income tax credit. They might get food stamps, rent control apartments,etc. etc. I am just considered some rich asshole not paying my fair share at 25%. If I were living in Canada making $35,ooo a year, would I get a free ride? Remember that the States does not have a GST. The majority of the money going to the federal government in the States is through federal income taxes. If Canada did not have a GST, and people making 35,000 a year did not have to pay federal income taxes..... there would be no Canada today. There is no way in hell you could maintain Health Canada with no GST,and people making $35,000 paying no federal taxes. You expect a lot more of your countrymen at the bottom of the ladder than we do. More of your countrymen pull the wagon than ride in it. I find it ironic that your country took steps to turn around your federal cluster fuck of a government in the 90's by slashing federal spending, and cutting corporate income taxes. Your country is in better shape than mine today by practising right wing policies.Less federal spending. Lower corporate tax rates to attract business. Its working for Canada. The proof is in the pudding. Yet untold lefties come on these forums and tell me and my fellow countrymen that we need to turn left to solve our problems. Go figure! :?

We are going to have to disagree about the Gini index. The last time I debated it, I could have sworn it was a year ago with Andy. I was sure that Cuba was ahead of the States, and that was the matter of debate. I tend to drink to much and forget a lot.I am too tired and lazy to look up the old thread at this point. I will say this about income (in)equality: (there is no nice way to say this) I would not have it any other way. There is is a reason that people are willing to risk their lives to come to America.There is a reason that people will suffer weeks of travel cramped in a cargo container, or risk the unforgivable desert,or treacherous atlantic in a raft to come here. They do not come here looking to be equal to their fellow man. Many had that where they came from. They were equal in Cuba. They do not wish to be equal. They wish to excell.My country is not about rewarding the also-rans. We reward the exceptional. Thats who makes it in America. If you can throw a fast ball faster than anyone on the planet, we want you! Are you the baddest mother fucker on the planet in the ring..... ala Lennox Lewis, Georges St. Pierre? You are welcome to come. We reward the best of the best,and we punish failure. Thats how we live,thats how we roll.Are you the best defenseman to play the game? The most prolific scorer? Welcome to America! Americans will pay dearly to see you do what you do. Do you have an idea that will change the world? You are welcome! Do you want to be rich? Are you driven to succeed? Heres your green card! We want the best of the best. If you were born and raised here, and are being left in the dust by a newcommer, too fucking bad! Lead,follow, or get out of the way. Equality is the last thing we want!

I thought I wrote a good post about Malden Mills earlier in this thread. No one responded to it. I was disappointed. My point was that the CEO of Malden Mills was a rich guy. He did everything right.He paid the salaries of his workers while his mill was being rebuilt from an industrial fire. He did not have to do it. He could have said: "screw you, you are on your own". He would have been whithin his leagal rights to do so. A rich guy did his best for his company. His country did not stand by him. They allowed cheap textile imports to put him out of business. Today the U.S. federal government loves to bitch about the rich. They do not pay their fair share. Yet your own statistics prove that the rich are paying for almost everything. The government likes to claim that the rich are not doing enough. Where was the federal government when Malden Mills needed them? One rich guy put it all on the line, and lost it all,thanks to his government. Talking about the rich and taxes is bread and circuses. The guy who just lost his job due to a plant closure, does not care how much some rich guy pays in taxes. He wants his job back.The rich guy paying more taxes will not save his home,car, or credit rating. Raising taxes on the rich will not solve the major problems facing America today. Jobs,or the lack therof. I am not seeing any positive results from the current administration on jobs. Taxing the rich is just class warfare. Lets stop the corporations from moving offshore. Lets help the corporations that are doing business today,not get steamrolled by cheap imports from the thirld world.


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andyt andyt:
Good stuff from Khar. One quibble: before the crash things were booming in the US since Clinton, yet inequality rose. A rising tide raised some boats way more than others, it wasn't a level tide.

As to inequality, both of you are against higher minimum wages. What, let's have greater income equality for middle class and up, but not the poorest workers? If, a la Khar, you want to have an income redistribution scheme for these lowest paid workers, where the govt just gives them money taken from the better off, that's fine, but really sounds like a business subsidy to me. Either way, you can't moan about income inequality on the one hand and say fuck you to the most unequal on the other.

Yes, the 1% have the most wealth and should pay higher taxes. But the amount of taxes needed means that everybody from the middle class up should pay more, just that highest marginal tax rate increases should of course be for the highest earners. We've all been paying too little tax for the services we want from the govt. I guess Shep will squeal how he's not rich with his 98k and all, but he's at twice the median wage. Certainly anybody at the median wage or up should pay more tax. Raising taxes a bit for people over 200k, Obama wants to do is going to bring in diddly squat for the deficit.


The reason I'm against higher minimum wages is that it solves nothing - it's basically like being on a giant hamster wheel. You get a raise, and everything goes up a little bit, leaving you with essentially the same pay cheque at the end of the day. I know, I lived on minimum wage (or near minimum wage) for years.

Minimum wage in Alberta just increased to $9.75 an hour (Sept. 1), but I guarantee that in the next six-twelve months, prices at places will creep up a little bit - five cents here and ten cents there. Individually, each increase is next to nothing, but cumulatively, they will almost totally erase the wage increase in a year or so. In the meantime, people working at minimum wage jobs will get an extra $50 a pay cheque or something. That's hardly enough to improve their lot in life.

My opinion is that if you want to improve people's lives, you need to give them job/skills training to get out of the minimum wage rut. Letting people spend their lives toiling at The Gap or Tim Horton's is not a viable long term solution. You need to teach them to be plumbers or electricians or hair stylists or receptionists or something that earns more than minimum wage.

The key is to get people out of JOBS and into CAREERS. That, in the long term, will reduce poverty and help low income folks.


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bootlegga bootlegga:

The key is to get people out of JOBS and into CAREERS. That, in the long term, will reduce poverty and help low income folks.


Take a look around. The biggest growth in jobs is for low paid work. Mcjobs. OTOH there aren't that many career jobs going. People are losing their careers in many cases and being pushed into these Mcjobs. There will always be jobs at the bottom of the ladder, and those jobs actually need doing. The question is how poorly we pay people doing those jobs. countries with better gini indeces than ours seem to have figured it out, we need to as well. If a mincome is the answer, as Khar would have it, I have no problem with that. Or if we provide subsidized housing, free transportation etc. I'm open to that too. Even in the US, a min wage worker can get food stamps. To me they just seem like schemes to subsidize business tho.


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andyt andyt:
bootlegga bootlegga:

The key is to get people out of JOBS and into CAREERS. That, in the long term, will reduce poverty and help low income folks.


Take a look around. The biggest growth in jobs is for low paid work. Mcjobs. OTOH there aren't that many career jobs going. People are losing their careers in many cases and being pushed into these Mcjobs. There will always be jobs at the bottom of the ladder, and those jobs actually need doing. The question is how poorly we pay people doing those jobs. countries with better gini indeces than ours seem to have figured it out, we need to as well. If a mincome is the answer, as Khar would have it, I have no problem with that. Or if we provide subsidized housing, free transportation etc. I'm open to that too. Even in the US, a min wage worker can get food stamps. To me they just seem like schemes to subsidize business tho.


Wrong.

$1:
The respect shown to the art of a tradesperson's work should be equal to that of any other profession. However, Holmes warns of a pending shortfall of skilled labour in the trades. He predicts that by 2020, if things don't change, we could be short by a million skilled tradespeople.


http://homes.winnipegfreepress.com/winn ... 0/id-2762/

And you know what, unlike white collar jobs, you can't outsource trades to other countries because they physically have to be here to do the work. Same goes for health care (another booming sector with aging baby boomers) and a number of other fields.

McJobs are geared towards students, youth and the elderly/semi-retired. Students and youth do it to gain work experience and the elderly/semi-retired do it to supplement their income and/or stave off boredom. The vast majority of people working minimum income wage jobs are there temporarily - for a a few years to perhaps a decade - then they move onto something else.


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Take a look at who does McJobs, and it's not just the groups you descr4ibe. Show me the youth and elderly that are being janitors, say. The ones I see are adults. Same with Wal Mart or other retail. Same with all the other low-skilled jobs out there - they're being done by adults. Only McDonalds itself seems to employ mostly young people.

I'm all for expanding training opportunities for people. But there are lots of jobs we need doing that don't require much training, but should still get paid a living wage. If you reduce income inequality but tell these people at the bottom to go fuck themselves, you'll just increase inequality for them. But i guess that's a typical comfortable middle class thing to do - bitch about people who earn more than you but give the finger to the people who earn less.


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PostPosted: Tue Sep 04, 2012 10:00 am
 


andyt andyt:
But i guess that's a typical comfortable middle class thing to do - bitch about people who earn more than you but give the finger to the people who earn less.


As opposed to the typical whiny under-achiever who just expects to be GIVEN everything. :roll:

Stereotypes are fun! :lol: Especially applied to andy and his inability to master the ever troublesome double double! :lol:


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PostPosted: Tue Sep 04, 2012 10:37 am
 


andyt andyt:
Take a look at who does McJobs, and it's not just the groups you descr4ibe. Show me the youth and elderly that are being janitors, say. The ones I see are adults. Same with Wal Mart or other retail. Same with all the other low-skilled jobs out there - they're being done by adults. Only McDonalds itself seems to employ mostly young people.

I'm all for expanding training opportunities for people. But there are lots of jobs we need doing that don't require much training, but should still get paid a living wage. If you reduce income inequality but tell these people at the bottom to go fuck themselves, you'll just increase inequality for them. But i guess that's a typical comfortable middle class thing to do - bitch about people who earn more than you but give the finger to the people who earn less.


Yeah, like the average Canadian kid out of high school becomes a janitor these days. Sorry, but most people want a desk job from 8-4 or 9-5 with benefits and all the rest.

I'm not telling anyone to go fuck themselves - I'm telling them work at that job until they can finish training for something better. And if that doesn't happen, then work two unskilled jobs at a time like I used to.

When my dad retired from the RCAF, he worked off and on as an aircraft mechanic until arthritis stopped him, but spent most of his working hours as a janitor. Instead of griping about minimum wage, he started his own janitorial company a year later and with it earned enough to house and feed a family of eight for the next two decades.

After he sold that business, he went into driving a taxi - yet another unskilled job.

I don't know how it works in Vancouver, but here it works like this (or used to when he drove) - you rent the car from the cab company for X. It comes with a full tank of gas and you drive for up to 12 hours. Whatever you earn is yours to keep and you bring it back with a full tank.

Now, he could have worked for the company and made a piss-poor living, but instead he bought a cab from them and drove much more than most company employees. He also 'rented' out his car when he wasn't driving, and because of that, he made far more than any company employee ever did (close to $2000 per week before expenses).

If people aren't willing to show some sort of gumption like my dad did, then pumping up minimum wage every year isn't going to help them either.

I'm all for giving a helping hand, but I'm not about to give them everything for doing nothing. People have to put in some effort to get ahead in life, not just expect it handed to them for showing up. Life isn't elementary school where you gets a gold star for attendance - you get out of it exactly what you put in. It may sound corny, but if you put in nothing, then expect nothing, while if you work hard, doors will open for you and you'll get somewhere in life.

Either way Andy, our conversations usually boil down to this;

Bootlegga: Watashi wa Bootlegga desu.

Andy: ?

Bootlegga: I said my name is Bootlegga in Japanese.

Andy: Oh, I don't understand Japanese.

Bootlegga: I know, just like you understand get that people should have to work for things either! :lol:

'Nuff said...


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