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biccat wrote:

Polonius wrote:...it would also devalue labor.

I think a lot of American labor is overvalued. Which is why there's external pressure to compete for "American jobs" like service, construction, and farming. When an employer can choose between paying a minimum wage to an American and below minimum wage to a Mexican, you get a better view of the value of that labor.

Polonius wrote:Getting rid of minimum wage laws would open up some jobs, but I think it would limit long term growth, because minimum wage jobs, much less jobs that pay less than that, keep a person stuck in poverty. You grow an economy by increasing consumer demand, not by cutting wages at the bottom.

Demand is only one part of growth, production is another. Someone who is paid $5/hour is providing a benefit to the economy. If he is paid $5/hour by the government, the money is coming from the taxpayer (eventually) and therefore must be taken out of the economy elsewhere.

Simply put, it's cheaper to pay someone $500/mo in welfare than it is to pay them $1000/mo in unemployment.

Well, that's actually one of the problems we face in this country: not enough for people to do. Production simply isn't a problem: we have all the goods and services we could want available, we just can't all afford them all.

Thats' why demand is important. Supply Side economics works a little bit (increased supply always lowers prices), but you still need a demand. if supply side economics were fully correct, than unemployment couldn't exist, as there would be a massive, cheap supply of labor. Instead, you need a demand for any good, service, or labor.

That's why taxing the rich works: it takes money that is not being used for consumption, and uses it.


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The becomes a philisophical policy discussion over whether the economy should serve only the richest/most talented, or if it should benefit all workers broadly.

Melissia wrote:

ZOMBIE CAT wrote:2. fewer restrictions on buisneses

Yeah, THAT has worked SO well for us in the last ten years.

Considering Bush passed 50K new regulations you're right it absolutely has gotten us into this mess. Don't believe the propaganda coming out of the donkey's agitprop anymore than the one coming out of the elephants.

How to encourage producers to invest in American business and create jobs.

1. Scrap the income tax, replace with a consumption tax like the fair tax.
2. Scrap the income tax, replace with a consumption tax like the fair tax.
3. Scrap the income tax, replace with a consumption tax like the fair tax.
4. Reenact Glass-Steagall
5. Repeal Sarbanes-Oxley.

Dice Monkey wrote:1. Scrap the income tax, replace with a consumption tax like the fair tax.
2. Scrap the income tax, replace with a consumption tax like the fair tax.
3. Scrap the income tax, replace with a consumption tax like the fair tax.

Consumption tax would only further devalue the economy as it is effectively a regressive tax, sot he average consumer would be essentially paying more as a percentage of their income in tax than those at the top, pushing the burden on them and thus reducing their buying power.

Polonius wrote:Well, that's actually one of the problems we face in this country: not enough for people to do. Production simply isn't a problem: we have all the goods and services we could want available, we just can't all afford them all.

No we don't have "all the goods and services we could want." I still don't have a sushi restaurant within walking distance of my house. Nor is there a good pre-civilization sci-fi plastic wargame available (I would call it Cavemen vs. Aliens).

There are lots of goods and services people will want (3 years ago nobody wanted an iPad, 10 years ago nobody wanted an iPhone, 20 years ago people were happy with beepers, 30 years ago nobody needed cell phones...) that haven't been developed or produced yet.

Polonius wrote:Thats' why demand is important. Supply Side economics works a little bit (increased supply always lowers prices), but you still need a demand. if supply side economics were fully correct, than unemployment couldn't exist, as there would be a massive, cheap supply of labor. Instead, you need a demand for any good, service, or labor.

Well, unemployment could exist because there's a lower limit to unemployment based on shifts in worker demographics, and some people who aren't willing to work for what the market says they should be paid. But when you add a minimum wage, you increase the level of unemployment because some employees won't provide enough value to pay them that wage.

Polonius wrote:That's why taxing the rich works: it takes money that is not being used for consumption, and uses it.

I disagree. Capital is a necessary component to business. The economy can't survive on consumption alone.

Frazzled wrote:When you have an open border minimum wage is almost meaningless to anything outside of government positions.

Not true. Union wages are often built on minimum wage laws.

Of course, given the severe drop in private-sector Unions, your point might be an accurate prediction.

Not true. Union wages are often built on minimum wage laws.

Of course, given the severe drop in private-sector Unions, your point might be an accurate prediction.

Exactly.

Vaguely on topic, if someone hires illegals to do a service job does that still count as outsourcing?

There might not be every concievable good or service, but the only reason you don't have a sushi restaurant near you is that there isn't demand for not, not because (demand aside), it's economically unfeasible.

What I mean by adequete production is that we have enough food, shelter, clothing, entertainment, health care, education, and luxury goods to provide every American with lots of all of those. We are no longer limited by the speed of production.

There are future products, to be sure. But even so... outside of the very short term, nobody is worried that we can't make mass produce smart phones at a price that average people can afford.

And yes, capital is essential to business. Which is why the difficutly in accessing credit is such a current stumbling block for entrepeneurs.

But there's a huge different between raising taxes, and taking all of the capital from the wealthy.

You might be excited about the prospect of a dystopia where the wealthy and uber talented live well, while everybody else is mired in poverty (which is what the free market will do, by the way)... but most people aren't.

By taxing the wealthy, sure, you disincentivize their labor. But... you free up capital and money that enables more people to become at least a little wealthy.



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On the other hand, I do love the way people can frame an issue. The hiriing of immigrants isn't "illegal hiring by a firm," it's the result of "open borders."

What about drug use? Is that not the fault of drug dealers and user, but rather lax enforcement at the border?

The flood of illegal immigrants has far mor to do with massive conspriacy by businesses and individuals to evade wage and hour laws, not to mention payroll taxes, than any government action or inaction.

Polonius wrote:the only reason you don't have a sushi restaurant near you is that there isn't demand for not, not because (demand aside), it's economically unfeasible.

There is demand for it. I would likely visit that restaurant at least 1-2 times a week and spend upwards of $10 each time. That means that there is an unfulfilled demand that is not being met by the current system. It's economically unfeasable because there isn't sufficient demand to make such a venture profitable.

Polonius wrote:What I mean by adequete production is that we have enough food, shelter, clothing, entertainment, health care, education, and luxury goods to provide every American with lots of all of those. We are no longer limited by the speed of production.

Yes, we could easily provide everyone with enough food, shelter etc. But to what end? If we could produce enough necessities with 50% of the population working, is it fair to them that they should work while the remainder enjoy the fruits of their labor? Ultimately, that's the question. In my opinion, those who contribute to society in the greatest amount should enjoy the greatest reward. Those who don't contribute don't deserve to starve, but they are living at the expense of the producers.

Polonius wrote:But there's a huge different between raising taxes, and taking all of the capital from the wealthy.

You said that the money should be taken from non-consumption to provide for consumption. If capital is necessary, by taking it from those who have it you're reducing the market for capital.

Polonius wrote:You might be excited about the prospect of a dystopia where the wealthy and uber talented live well, while everybody else is mired in poverty (which is what the free market will do, by the way)... but most people aren't.

You're taking a false assertion (the free market will create sharp class divisions between the rich and the poor) and using it to prop up a straw man. I don't think that a free market economy would create a dystopia, rather it would create a world where luxury products are widely available and inexpensive. Like they are in the United States where even someone living at the poverty line can have disposable income, savings and even some 'luxury' goods (like a flat screen TV or a cell phone).

Polonius wrote:By taxing the wealthy, sure, you disincentivize their labor. But... you free up capital and money that enables more people to become at least a little wealthy.

When you tax the wealthy it doesn't "free up" money, it simply moves it from one person to another. It doesn't increase the net amount of wealth. It also takes that wealth from a higher utility to a lower utility.


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Polonius wrote:The flood of illegal immigrants has far mor to do with massive conspriacy by businesses and individuals to evade wage and hour laws, not to mention payroll taxes, than any government action or inaction.

Yes-ish. But the government, by not strictly enforcing the immigration and wage and hour laws has allowed this environment to survive.

I agree that State and the Federal governments need to crack down not solely on illegal immigrants but on employers who refuse to abide by employment laws.

Melissia wrote:

Dice Monkey wrote:1. Scrap the income tax, replace with a consumption tax like the fair tax.
2. Scrap the income tax, replace with a consumption tax like the fair tax.
3. Scrap the income tax, replace with a consumption tax like the fair tax.

Consumption tax would only further devalue the economy as it is effectively a regressive tax, sot he average consumer would be essentially paying more as a percentage of their income in tax than those at the top, pushing the burden on them and thus reducing their buying power.

They already pay that percentage in higher cost that businesses pass on to the consumer. This is on top of the federal taxes they are already charged. You have to realize that businesses will never pay taxes, they will simply mark that as an additional cost and hand that to the poor people you claim to be concerned about. If you removed the income tax you would basically smash away the shackles that have businesses fleeing to places like the Caribbean and Singapore. On the obverse you would have expansion in all sectors except accounting and Tax law (which makes up a good percentage of lobbying in the country).

You would also remove a wedge issue from both sides, no one would dare raise taxes when everyone would be able to feel them.

And yes, capital is essential to business. Which is why the difficutly in accessing credit is such a current stumbling block for entrepeneurs.

Accessing cheap easy credit is the problem that got us into the mess in the first place. My making it accessible you create a false demand and cause a bubble which will eventually burst. If you want real growth don't interfere by trying to create a new bubble. Entrepreneurs like myself are much more weighed down by taxes, regulations and trying to comply with all of those things than finding credit.

By taxing the wealthy, sure, you disincentivize their labor. But... you free up capital and money that enables more people to become at least a little wealthy.

The wealthy are the ones who start business and invest their capital which fuels the economy, what you are advocating is the same thing that has failed since it's inception in the 20th century. There is a reason why the 1920 depression lasted a year despite being more severe than the 1929 and 1932 downturns. Care to venture what that is?

1. Invade Canada, Greenland, and Antarctica (in that order). We now own the poles baby! If you see anything alienlike in a block of ice, leave it the &*%^% alone.

Better send Kurt Russel along, just in case.

RatBot wrote:

1. Invade Canada, Greenland, and Antarctica (in that order). We now own the poles baby! If you see anything alienlike in a block of ice, leave it the &*%^% alone.

Better send Kurt Russel along, just in case.

And a flame thrower. Belay that. Lots of flame throwers.

biccat wrote:

Polonius wrote:the only reason you don't have a sushi restaurant near you is that there isn't demand for not, not because (demand aside), it's economically unfeasible.

There is demand for it. I would likely visit that restaurant at least 1-2 times a week and spend upwards of $10 each time. That means that there is an unfulfilled demand that is not being met by the current system. It's economically unfeasable because there isn't sufficient demand to make such a venture profitable.

right, but it's not because there isn't enough rice, fish, or well trained sushi chefs. That's all my point was.

Yes, we could easily provide everyone with enough food, shelter etc. But to what end? If we could produce enough necessities with 50% of the population working, is it fair to them that they should work while the remainder enjoy the fruits of their labor? Ultimately, that's the question. In my opinion, those who contribute to society in the greatest amount should enjoy the greatest reward. Those who don't contribute don't deserve to starve, but they are living at the expense of the producers.

I could care less what other people do. I want to work, and so do a lot of people. Most people enjoy having a job.

The flip side to this question is: why make people that don't want to work, do so? I'm not advocating total social welfare (the population issue gets rough), I'm just saying that the mindset that everybody needs to work or they are morally inferior, when there isn't enough work to go around, is questionable.

You said that the money should be taken from non-consumption to provide for consumption. If capital is necessary, by taking it from those who have it you're reducing the market for capital.

I dont' really understand this, but I'm not actually an economist.

You're taking a false assertion (the free market will create sharp class divisions between the rich and the poor) and using it to prop up a straw man. I don't think that a free market economy would create a dystopia, rather it would create a world where luxury products are widely available and inexpensive. Like they are in the United States where even someone living at the poverty line can have disposable income, savings and even some 'luxury' goods (like a flat screen TV or a cell phone).

I'm not sure it's a straw man. The working poor in the US have things like disposable income and savings almost exclusively because of regulation of the market. Food subsidies keep prices low. Investment in infrastructure makes transportation cheaper. Minimum wage laws set a floor to salaries.

As Dogma once said, "most people are average, and average ain't that good." It's hard to imagine a truly free market that doesn't end with the unskilled (or wrongly skilled) being inable to provide their own sustinence. Also... free markets don't stay free. Monopolies and trusts are a nearly inevitable result of free markets.

When you tax the wealthy it doesn't "free up" money, it simply moves it from one person to another. It doesn't increase the net amount of wealth. It also takes that wealth from a higher utility to a lower utility.

Well... that's a tricky one. The law of diminishing returns would disagree. $1000 is useful to me, but it's far more useful to a person that can't afford this month's rent, and far less useful to a person that earns four times my salary.

Yes-ish. But the government, by not strictly enforcing the immigration and wage and hour laws has allowed this environment to survive.

I agree that State and the Federal governments need to crack down not solely on illegal immigrants but on employers who refuse to abide by employment laws.

Well, this is where I point out that arguing over who is bending America over more, business or government, is missing the fact that they're really pretty much the same.

Simple, Here are some :

-Population control officer.
-Body harvest technician.
-Human tissue/fat render technician.
-Sewerage/crematoria mineral reclamator technician.
-Loboto-gladiator.
-Living Kinetic battery
-Opiate-HTC-Alcoloid-Amphetamine (OHAA) pharmacy assistant.
-'Neighbourhood Patriot' (Brought in with the revised patriot act of 2013)
-Troll Gladiator, 'Flame wars' takes fox's primetime saturday slot by June 2014.

Polonius wrote:right, but it's not because there isn't enough rice, fish, or well trained sushi chefs. That's all my point was.

I see. Although I think there is a shortage of sushi chefs. It's a fairly demanding set of skills.

Polonius wrote:I could care less what other people do. I want to work, and so do a lot of people. Most people enjoy having a job.

But would you work the same hours and put in the same effort if you didn't have to? I'd certainly spend at least a few hours gaming or painting rather than at work, which would reduce what I contribute. Plus, I think you would have a hard time finding people who really enjoy sweeping up vomit in elementary schools if working were voluntary.

Polonius wrote:The flip side to this question is: why make people that don't want to work, do so? I'm not advocating total social welfare (the population issue gets rough), I'm just saying that the mindset that everybody needs to work or they are morally inferior, when there isn't enough work to go around, is questionable.

Because I disagree with the idea that there isn't enough work to go around. There are a lot more productive things people can do than sit around consuming what others produce (watch TV, buy stuff).

Legalize Prostitution.

Tax the hell out of it.

Drugs are far more lucrative taxable.

Perhaps with an algorithimic 'desirability/verility index' one could establish the barter value of sex for goods and services. Would be more efficient, also it could be tax deducable depending on the percentage it made up of the individual's yearly income.

Dice Monkey wrote:If you removed the income tax you would basically smash away the shackles that have businesses fleeing to places like the Caribbean and Singapore.

Yeah, I'm not convinced that's a statement that's actually based on reality. The assumption that companies would lower prices because of a switch from payroll to consumption tax rings false to me. Certainly, big business isn't hiring despite all of the politicians practically lining up to spit-shine the arses of their pants.


At least my statements have mathematical reasons behind them.

Say a five percent consumption tax, and two persons. Person A makes 10 grand a year, person B makes 50 grand a year, person C makes 100 grand a year.

Person A has to live off of buying in bulk, and preparing their own meals from mass produced cheap meals, and pays on average 5 dollars a day on food. On special occasions over a year they pay an additional 180 dollars for food, for an even 2000. This is pretty marginal, and you'll probably not be able to afford too much more than fast food for "eating out". They pay 100 USD in taxes, or 1% of their income, on this food. After food and taxes, they have 7,900 for paying bills of various kinds, gas, and so on. That one hundred dollars is actually a pretty big hit to them, all things considered. Especially with the tax adding to the price of their purchases, they really can't afford at all to save.

Person B can afford slightly higher quality food, but mostly produces their own meals or the cheaper of pre-prepared meals, and pays on average 15 dollars a day on food. On special occasions over a year, they pay an additional 540 dollars for food, for an even 6000. That's quite a bit more spending money on food, especially for eating out-- luxury foods. They pay 300 USD in taxes, or .6% of their income, on this food. So despite having three times as much money to spend on food, including luxury items, they pay less taxes as a percentage of their income on it, and have more for other pursuits. After food and taxes, they have 43,700 for paying bills, gas, entertainment, and so on. While they certainly feel that 300 in taxes, it doesn't have as big of an effect on them as it did person A. They can still also afford to save some despite the tax, unlike person A.

Person C likes luxury foods, and pays on average 40 dollars a day (!) on food. They have close to 2 and a half grand (2,440) set aside for special occasions, as they like to eat at very nice restaurants. This leads to a total of 16,000 spent on food, and a total of 800 USD in taxes... or 0.8% of their income. So despite having food that's the creme of the culinary crop, they're paying less in taxes for it as a proportion of their income than the person who's barely scraping by-- and they're far less effected by the tax, which is a flat rate for every person. And they still have 83,200 left for bills, entertainment, and so on. They practically don't even notice the tax, they might even pay their waiters more on average than they pay taxes to the government. And if they don't want to pay more taxes? They can just choose to put a portion of their money in a bank have that money earn money for them with no extra work from themselves. It ain't consumption, so it ain't taxed.


This is the same reason that a flat income tax is also a bad idea.

Melissia wrote:[Yeah, I'm not convinced that's a statement that's actually based on reality. The assumption that companies would lower prices because of a switch from payroll to consumption tax rings false to me. Certainly, big business isn't hiring despite all of the politicians practically lining up to spit-shine the arses of their pants.

Well, theoretically prices are set to maximize revenue. Since the fair tax would necessarily increase the effective cost at time of sale for all goods, failing to adjust prices in concert would likely have a negative impact on demand; all else being equal.

That said, I'm skeptical as to how much of a positive economic impact that a revenue neutral fair tax would have, given that it would presumably (maybe not, I've not read the proposed legislation) affect corporate purchases as well. It would, however, reduce their administrative costs, which is something.

I will simply invoke one of my personal rules:

"anything a special interest group proposes that has the word "fair" in the title is almost assuredly not."

Applies to all sides of the spectrum!

Polonius wrote:I will simply invoke one of my personal rules:

"anything a special interest group proposes that has the word "fair" in the title is almost assuredly not."

Applies to all sides of the spectrum!

This is a definite maxim of Life (TM).

Im not familiar with USA's economic plans, but is it something like this...?

Side A: American cant offer jobs because the condition to create job within USA are inefficient, conclusion = probably set factories and work in asian 2nd world countries for more profits due to cheaper labor.

Side B: We'll need to jump start consumer's purchase in order to jump start companies which then creates further work opportunities. We'll do this by taxing the ones creating jobs
while the ones with less income gets more benefits. ( a tiny bit of Communism? )

Of course im probably way off, but if someone can explain.

Thats not far off...

Lots of anti-globalists ITT. Troubling.

The primary bottleneck presently is the demand side. The consumer needs to buy more. If we're going to relax restrictions on anyone, it's regular people who buy crap. You can't call a small business owner a "job creator" if nobody is coming through the door. If someone is willing to hire more employees just because they got a tax break, that person is stupid. Hiring is coupled with how much business you are ACTUALLY GETTING, not how much less you pay in taxes. If you have a small business right now, and there is some expansion you'd like to do and that expansion is profitable, then you would already have borrowed to do it. The fact that you haven't expanded yet says that expansion is a bad idea right now.

If you've got the customers to need to expand, then you can afford to expand WITHOUT a tax break. If you can't afford to expand without a tax break, then you SHOULDN'T BE EXPANDING ANYWAY. This is like business 101.

TLR, any business which is not already hiring is not in a position to hire even if they HAD the money free. Demand is the bottleneck, not supply.

Hmm, so then...

If people wants lower price and cheaper item, USA company will have no choice other than hiring cheap none US labor.

Yet if they want to create jobs within USA, the consumers better be prepared to pay for way higher prices.

This is why its going back and forth isn't it?

LunaHound wrote:Hmm, so then...

If people wants lower price and cheaper item, USA company will have no choice other than hiring cheap none US labor.

Yet if they want to create jobs within USA, the consumers better be prepared to pay for way higher prices.

This is why its going back and forth isn't it?

There's nothing wrong with NON-us labor. If an american company can save tons of money by getting the labor overseas, then that represents a larger profit margin with which they can expand what business they HAVE over here. (assuming americans are buying their products, see my last post)

You need to lose the idea that hiring here is automatically better than hiring somewhere else. The economy is global, the money flows back and forth across oceans constantly. The countries we outsource to are buying just as much of our stuff right back. You can't talk about leaving business alone, then also want to force them to use expensive labor for no functional reason. When we use cheap labor, we are creating value for less investment.

Rented Tritium wrote:You need to lose the idea that hiring here is automatically better than hiring somewhere else. The economy is global, the money flows back and forth across oceans constantly. The countries we outsource to are buying just as much of our stuff right back.

No they are not actually, not by a long shot.

Frazzled wrote:

Rented Tritium wrote:You need to lose the idea that hiring here is automatically better than hiring somewhere else. The economy is global, the money flows back and forth across oceans constantly. The countries we outsource to are buying just as much of our stuff right back.

No they are not actually, not by a long shot.

I agree, especially china.

They take away LOTS of potential American jobs,
And im sure the majority of the workers cannot afford to buy back what they made ( a TV may very well be their yearly salary )

Take away tax cuts for the rich. (This won't create jobs, but the fact that the people with more money have to give the government less money is ridiculous.

Also, don't listen to the bs Frazzled is saying about how Obama is to blame for this current economic climate. He'll listen to anything the Republicans tell him, like the good little Republican foot soldier he is.

Karon wrote:Take away tax cuts for the rich. (This won't create jobs, but the fact that the people with more money have to give the government less money is ridiculous.

Also, don't listen to the bs Frazzled is saying about how Obama is to blame for this current economic climate. He'll listen to anything the Republicans tell him, like the good little Republican foot soldier he is.

Thats stormtrooper to you boyo! Once we've blamed the burning of the Capital on you commies its off to the re-education facility for you!!!

I don't get how you can be super free market and want to restrict these guys as little as possible, but then at the same time tell them what country to do business in. Why SHOULDN'T a company use the cheapest labor available. Cheap labor means cheap products means more money in my pocket means buying more products. Oh, we can make those products cheaper with outsourcing as well? Awesome!

It's called capitalism guys. I'm really surprised an invisible hand guy like you isn't better at understanding it. Forget about those "jobs" that are invisibly flying over the ocean or whatever you think is happening. A company is maximizing the bottom line and creating more value for less input. This is how economies function. You want the government to tell someone where they're allowed to manufacture their products, what are you, a socialist?