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If you had to choose just one, do you think the US government should (right now):  
Invest to stimulate employment 88% 7  88% 
Reduce spending to reduce the deficit 13% 1  13% 
Total votes : 8

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iNow
Post  Post subject: US Politics: King for a Day - What would you do?  |  Posted: Sun Aug 28, 2011 7:24 pm
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What do you think is the better approach right now if you had to choose just one :?:

Should the US government invest to create jobs or should they reduce spending to decrease the deficit?
Why did you choose the option you did?

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GiantEvil
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Sun Aug 28, 2011 9:50 pm
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Invest. There is a clear relationship between investment and return. < investment = < return. > investment = > return. 0 investment = 0 return. Duh.

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Falconer360
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 6:15 pm
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Investment. Take the problem and scale it down in scope to that of a small town. If everyone shops at the local stores their money goes into keeping the people there employed and possibly opening new positions. However if the people of said town get tight with their cash and stop spending in the town as much, soon enough the stores have to start laying people off, no new jobs are created and people start spending even less (because they don't have jobs or are trying to squirrel away their money). I know this is an oversimplified view but it does fairly accurately describe the situation.

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paleoichneum
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 6:23 pm
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invest. reduction of spending does not actually put more funds into the system and thus there is no increase in funds circulating and stimulating growth of the economy, which will then generate revenue for paying off the deficit.

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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 6:58 pm
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iNow wrote:
What do you think is the better approach right now if you had to choose just one :?:

Should the US government invest to create jobs or should they reduce spending to decrease the deficit?
Why did you choose the option you did?


Your choice of words is deceptive and leading.

The U.S. Government has never "invested" in anything, nor created jobs that actually create wealth. Private sector jobs do that.

The government needs to act in a way that permits the private sector to create new jobs and wealth in the process. In general that means getting out of the way and not inhibiting the process. Part of getting out of the way is actually enforcing those few regulations that are required and beneficial, eliminating useless red tape, and limiting competition by the government for resources, including money. Reduction of wasteful spending does just that. Excess government spending devalues the currency and does the opposite.

In short a reduction in deficit spending is necessary along with tax reduction, reduction in silly regulations and improved enforcement of reasonable and necessary regulations. It was government mandates that created the previous banking crisis and more bone headed government action is not the answer to a weak economy.

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paleoichneum
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 7:25 pm
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so what would you classify the ccc and other projects of the thirties?

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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 8:35 pm
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paleoichneum wrote:
so what would you classify the ccc and other projects of the thirties?



welfare

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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 8:37 pm
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DrRocket wrote:
paleoichneum wrote:
so what would you classify the ccc and other projects of the thirties?



welfare

Exacerbated by complete failure to apply reasonable regulation of the stock market and poor fiscal policy.

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paleoichneum
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 8:48 pm
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Really, so if they had been applied at other times, would you have called them infrastructure development?

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GiantEvil
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 9:45 pm
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DrRocket wrote:
The U.S. Government has never "invested" in anything, nor created jobs that actually create wealth.

Highway infrastructure doesn't employ people in it's construction or do anything to generate wealth?
Education doesn't employ people or generate wealth?

Capital as a commons is a benefit to many citizens, capital as a personal possession is some assholes private jet. Some asshole who never received my consent to the authority of greater resource control.

It all boils down to 'tool's in hand's'.
Now there's this myth that a person won't take a tool to their hand without some external reward involved, I will take a tool to my hand for the love of it. I have no reason to believe that I am uniquely exceptional in this.
The sweat of the brow is an irreducible condition of existence. I find it preferable that such sweat, after it has provided my sustenance, become a public park and not some assholes private jet.

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15uliane
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 10:40 pm
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I would cut spending, but i'd raise taxes too, especially for rich people. The Bush era tax cuts would be gone, and the government would get an extra trillion dollars. The deficit is a cloud over the US' head always raining on everyones parade. I would probably overhaul the tax code while I'm at it and, after that, I might as well just tighten up the executive departments. I don't quite know if or how the government invests, so I can't take that choice.


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iNow
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 10:57 pm
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GiantEvil wrote:
Highway infrastructure doesn't employ people in it's construction or do anything to generate wealth?
Education doesn't employ people or generate wealth?

Capital as a commons is a benefit to many citizens, capital as a personal possession is some assholes private jet. Some asshole who never received my consent to the authority of greater resource control.

It all boils down to 'tool's in hand's'.

Those construction workers and teachers and all of those others who are "holding tools" as a result of government spending also buy things with their income, purchasing goods and items at stores, paying rent, taking kids to the doctor, etc... and all of those people working where the construction workers and teachers and tool holders shopped now also have more income and they then go out and do the same... They go to the store, they pay their bills, take their kids to get a toy... then those merchants spend that money... then those merchants spend that money... then those merchants spend that money... lather, rinse, repeat.

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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 11:21 pm
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GiantEvil wrote:
Highway infrastructure doesn't employ people in it's construction or do anything to generate wealth?
Education doesn't employ people or generate wealth?


Highway construction as with maintenance of the military is a necessary expense, but not an investment nor a direct generator of wealth -- you cannot sell a road (in most cases). The construction of highwaqys using federal money is an astonishingly wasteful process that takes tax money from individuals and then filters it through the federal government back through state and local governments before a single foot of pavement is laid.

Similarly education is a necessary expense. It does not generate wealth unless and until it is actually used to create wealth. Again the involvement of the federal has resulted in high cost and poor performance. The very best academic primary and secondary school that I have ever encountered is the University School in Jackson, Tennessee. It is a private school with tuition far below the average national per pupil expenditure in public schools. Despite that they routinely win academic competitions and place students in the top universities.



GiantEvil wrote:
Capital as a commons is a benefit to many citizens, capital as a personal possession is some assholes private jet. Some asshole who never received my consent to the authority of greater resource control.


Fortunately that asshole does not need your consent. It is called private property rights.

Bill Gates has done far more than you to create wealth for everyone. His jet is his property, and well earned at that. Bill is no asshole. The asshole is the person who lives off the work of others, collecting unearned money confiscated under threat of force and re-distributed by the government

GiantEvil wrote:
It all boils down to 'tool's in hand's'.
Now there's this myth that a person won't take a tool to their hand without some external reward involved, I will take a tool to my hand for the love of it. I have no reason to believe that I am uniquely exceptional in this.
The sweat of the brow is an irreducible condition of existence. I find it preferable that such sweat, after it has provided my sustenance, become a public park and not some assholes private jet.


Then spend your money as you see fit. But when you try to tell someone else how to spend theirs you play the role of a thief, effectively taking their property.

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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 11:28 pm
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iNow wrote:
Those construction workers and teachers and all of those others who are "holding tools" as a result of government spending also buy things with their income, purchasing goods and items at stores, paying rent, taking kids to the doctor, etc... and all of those people working where the construction workers and teachers and tool holders shopped now also have more income and they then go out and do the same... They go to the store, they pay their bills, take their kids to get a toy... then those merchants spend that money... then those merchants spend that money... then those merchants spend that money... lather, rinse, repeat.


None of which requires that it originate with government spending. And everything that you name would be demanded by consumers in the marketplace.

Welcome to free market economics.

Note that you have omitted the initial step whereby the money is first taken from the very people that you mention, as well as others. The government produces nothing. The government merely redistributes wealth, very inefficiently and very ineffectively.

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paleoichneum
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 11:29 pm
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DrRocket wrote:
GiantEvil wrote:
Highway infrastructure doesn't employ people in it's construction or do anything to generate wealth?
Education doesn't employ people or generate wealth?


Highway construction as with maintenance of the military is a necessary expense, but not an investment nor a direct generator of wealth -- you cannot sell a road (in most cases). The construction of highwaqys using federal money is an astonishingly wasteful process that takes tax money from individuals and then filters it through the federal government back through state and local governments before a single foot of pavement is laid.



Do you have a citation for this?? The money is coming from the state or federal government funds that are set aside specifically for infrastructure.

The money that goes to the people building/maintaining the infrastructure is direct infusion of wealth into the economy.

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15uliane
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Aug 29, 2011 11:31 pm
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DrRocket wrote:
The government produces nothing. The government merely redistributes wealth, very inefficiently and very ineffectively.

Yet it is necessary.


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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Tue Aug 30, 2011 12:42 am
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15uliane wrote:
DrRocket wrote:
The government produces nothing. The government merely redistributes wealth, very inefficiently and very ineffectively.

Yet it is necessary.


And in its proper role it is a good thing. But it is counterproductive when there is too much reliance on central power and central planning. That was illustrated with the failure of the USSR.

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iNow
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Tue Aug 30, 2011 1:59 am
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DrRocket wrote:
iNow wrote:
Those construction workers and teachers and all of those others who are "holding tools" as a result of government spending also buy things with their income, purchasing goods and items at stores, paying rent, taking kids to the doctor, etc... and all of those people working where the construction workers and teachers and tool holders shopped now also have more income and they then go out and do the same... They go to the store, they pay their bills, take their kids to get a toy... then those merchants spend that money... then those merchants spend that money... then those merchants spend that money... lather, rinse, repeat.


None of which requires that it originate with government spending. And everything that you name would be demanded by consumers in the marketplace.

I agree, that in normal times, none of this is required to originate with government spending. However, right now we are in a situation where interest rates are very low and yet businesses are not expanding. This is primarily because demand is so low, and demand is so low primarily because so many people are out of work or lacking in savings. There are other factors at work, and concern about regulation and the future of the global economy, but the primary issue right now is consumers not consuming, and hence producers not producing.

Since the market is not currently able to self-correct (it is, in fact, feeding on itself and stuck in self-reinforcing negative feedback loops), the government serves as a last resort to get things moving again. These are not normal times. Demand is quite low, interest rates are near zero, and the markets don't see growth so are falling. Government spending puts people to work, and those people spend that money, so growth would occur, and the markets would settle and gather momentum until arriving at a point where the system can self-sustain.

I've grossly oversimplified, but the central point I'm making is valid. The market is failing us right now, and history has shown that (while often inefficient) the government can make significant improvements rather quickly in the lives of millions.

The issue of taxation is a bit removed from the thread since it's been with us since our founding and it's reason for existence elucidated quite poignantly in the Federalist papers.


DrRocket wrote:
Welcome to free market economics

Except, we're not a free market. We exist in a hybrid economy, and for good reason.

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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Tue Aug 30, 2011 2:31 am
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iNow wrote:
DrRocket wrote:
iNow wrote:
Those construction workers and teachers and all of those others who are "holding tools" as a result of government spending also buy things with their income, purchasing goods and items at stores, paying rent, taking kids to the doctor, etc... and all of those people working where the construction workers and teachers and tool holders shopped now also have more income and they then go out and do the same... They go to the store, they pay their bills, take their kids to get a toy... then those merchants spend that money... then those merchants spend that money... then those merchants spend that money... lather, rinse, repeat.


None of which requires that it originate with government spending. And everything that you name would be demanded by consumers in the marketplace.

I agree, that in normal times, none of this is required to originate with government spending. However, right now we are in a situation where interest rates are very low and yet businesses are not expanding. This is primarily because demand is so low, and demand is so low primarily because so many people are out of work or lacking in savings. There are other factors at work, and concern about regulation and the future of the global economy, but the primary issue right now is consumers not consuming, and hence producers not producing.

Since the market is not currently able to self-correct (it is, in fact, feeding on itself and stuck in self-reinforcing negative feedback loops), the government serves as a last resort to get things moving again. These are not normal times. Demand is quite low, interest rates are near zero, and the markets don't see growth so are falling. Government spending puts people to work, and those people spend that money, so growth would occur, and the markets would settle and gather momentum until arriving at a point where the system can self-sustain.



Markets are not failing. What has failed is government attempts (2 of them) at "stimulus" and the failure is due in part to the uncertainty among business leaders as to the future impact of government regulations. Similarly, demand by consumers and small business is inhibited by uncertainties.

The stock market, which is a leading indicator is rather volatile but seems to point toward future growth, assuming that idiotic government actions don't screw it up. The Dow was up over 250 pts today.

We have in fact an overabundance of government spending and an acceleration in government deficit spending is not needed. This was central to the recent debacle over the debt ceiling -- in which both sides came across as unreasonable. But the central point that a balanced budget is needed was made quite forcefully.

Note that I did NOT say that a balanced budget amendment is needed. There are times when deficit spending is desirable. But those times should be rare exceptions rather than the exagerated norm that they have come to be.

Government excesses (both major parties) created this mess. Government excesses are not the solution. The free market can be the solution. Corprate balance sheets are filled with cash waiting for sufficient clarity to justify large investments. If and when the government gets out of the way that investment will dwarf the impact of any government "stimulus".

BTW the only "stimulus" that I have personally seen is an attempt to dramatically increase my taxes (and no I am not in the over $250K club) and a bunch of road construction projects in places where it is not needed while needed maintenance goes unperformed. The roads were just fine, but I can barely leave my subdivision due to unnecessary construction while the interstate is full of potholes in areas that were resurfaced last year. Government inefficiency personified.

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iNow
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Tue Aug 30, 2011 3:28 am
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DrRocket wrote:
What has failed is government attempts (2 of them) at "stimulus" and the failure is due in part to the uncertainty among business leaders as to the future impact of government regulations.

The challenge with this argument is that "stimulus" in the amounts needed was not technically tried. The government spending we saw went mostly to social safety net programs like unemployment insurance and food stamps. Another hefty portion went to save jobs of fire fighters, cops, and teachers, and another large chunk went to cutting taxes on the middle class (40% of all stimulus funds went to tax cuts). When all of this is said and done, only a relatively small percentage actually went toward "stimulus," and the failure you cite is not in the fact that we tried and failed, but in the fact that we never actually tried.

Now, we can discuss whether or not our current government is capable or incapable of doing a stimulus properly, but my argument is a bit removed from that. I'm saying they can stimulate and should given the circumstances in which we currently find ourselves. I'm not arguing that our government wouldn't fuck it up because they're a bunch of paste eaters who can't agree on anything. I'm arguing that they need to find a way to do it right, and all evidence suggests they should be doing this if they could.

And, TARP wasn't stimulus. It was to avoid collapse of the system, in much the same way that defribulation is not a lifestyle choice, but a way to save lives.


DrRocket wrote:
Similarly, demand by consumers and small business is inhibited by uncertainties.
<...>
Corprate balance sheets are filled with cash waiting for sufficient clarity to justify large investments.

I agree with you that uncertainty in the economy is a problem right now, but I disagree with where you suggest the uncertainty resides. You appear to suggest that businesses are uncertain with what government will do, what taxes will be, etc. That may be true for a small percentage of businesses, but when you survey actual business leaders and executives from major corporations, the majority appear to define their uncertainty as being due to the governments non-action... their uncertainty arises from the fact that they don't see growth coming any time soon... their uncertainty (at least according to their comments) is with the fact that the economy will likely remain stalled until the government steps in to do something, and so they don't know when demand for their products will pick up again, and hence they refuse to invest, and there is no incentive to do so. They don't need to make investments in either people or capital equipment as their current workforce and tools are more than capable of meeting the low demand.

Yes, there is uncertainty, but the component of it rooted in lack of clarity on regulations or taxes is relatively minor. That type of uncertainty is also of a small enough order of magnitude that it can't really account for the slowness we're right now experiencing. It's a drop in the bucket. People are uncertain when the economy will pick back up, less so about what regulations will be. I know this is counter to the narrative we so often hear, but that narrative is wrong.


EDIT: CNNMoney: http://finance.fortune.cnn.com/2011/08/ ... e-comment/

Quote:
So long as we elect new federal representatives every two years, there will never be any certainty over future tax policy, regulatory policy, healthcare policy, etc. Let alone macro-economic conditions that always are on the move. Any company waiting for "certainty" before hiring might as well shut down its recruitment department.


Financial Times, 8 hours ago: http://www.ft.com/cms/s/0/ace0a38a-c9ac ... z1WTvPq5yr
Nasdaq, 10 hours ago: http://www.nasdaq.com/aspx/stock-market ... x-business



DrRocket wrote:
BTW the only "stimulus" that I have personally seen is an attempt to dramatically increase my taxes (and no I am not in the over $250K club)

Interesting. My taxes have gone down, as have the taxes of 95% of Americans.

http://articles.boston.com/2011-02-08/n ... -deduction
http://www.cbsnews.com/8301-503544_162- ... 03544.html

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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Tue Aug 30, 2011 6:04 am
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iNow wrote:
DrRocket wrote:
What has failed is government attempts (2 of them) at "stimulus" and the failure is due in part to the uncertainty among business leaders as to the future impact of government regulations.

The challenge with this argument is that "stimulus" in the amounts needed was not technically tried. The government spending we saw went mostly to social safety net programs like unemployment insurance and food stamps. Another hefty portion went to save jobs of fire fighters, cops, and teachers, and another large chunk went to cutting taxes on the middle class (40% of all stimulus funds went to tax cuts). When all of this is said and done, only a relatively small percentage actually went toward "stimulus," and the failure you cite is not in the fact that we tried and failed, but in the fact that we never actually tried.

Now, we can discuss whether or not our current government is capable or incapable of doing a stimulus properly, but my argument is a bit removed from that. I'm saying they can stimulate and should given the circumstances in which we currently find ourselves. I'm not arguing that our government wouldn't fuck it up because they're a bunch of paste eaters who can't agree on anything. I'm arguing that they need to find a way to do it right, and all evidence suggests they should be doing this if they could.

And, TARP wasn't stimulus. It was to avoid collapse of the system, in much the same way that defribulation is not a lifestyle choice, but a way to save lives.


DrRocket wrote:
Similarly, demand by consumers and small business is inhibited by uncertainties.
<...>
Corprate balance sheets are filled with cash waiting for sufficient clarity to justify large investments.

I agree with you that uncertainty in the economy is a problem right now, but I disagree with where you suggest the uncertainty resides. You appear to suggest that businesses are uncertain with what government will do, what taxes will be, etc. That may be true for a small percentage of businesses, but when you survey actual business leaders and executives from major corporations, the majority appear to define their uncertainty as being due to the governments non-action... their uncertainty arises from the fact that they don't see growth coming any time soon... their uncertainty (at least according to their comments) is with the fact that the economy will likely remain stalled until the government steps in to do something, and so they don't know when demand for their products will pick up again, and hence they refuse to invest, and there is no incentive to do so. They don't need to make investments in either people or capital equipment as their current workforce and tools are more than capable of meeting the low demand.

Yes, there is uncertainty, but the component of it rooted in lack of clarity on regulations or taxes is relatively minor. That type of uncertainty is also of a small enough order of magnitude that it can't really account for the slowness we're right now experiencing. It's a drop in the bucket. People are uncertain when the economy will pick back up, less so about what regulations will be. I know this is counter to the narrative we so often hear, but that narrative is wrong.


EDIT: CNNMoney: http://finance.fortune.cnn.com/2011/08/ ... e-comment/

Quote:
So long as we elect new federal representatives every two years, there will never be any certainty over future tax policy, regulatory policy, healthcare policy, etc. Let alone macro-economic conditions that always are on the move. Any company waiting for "certainty" before hiring might as well shut down its recruitment department.


Financial Times, 8 hours ago: http://www.ft.com/cms/s/0/ace0a38a-c9ac ... z1WTvPq5yr
Nasdaq, 10 hours ago: http://www.nasdaq.com/aspx/stock-market ... x-business



DrRocket wrote:
BTW the only "stimulus" that I have personally seen is an attempt to dramatically increase my taxes (and no I am not in the over $250K club)

Interesting. My taxes have gone down, as have the taxes of 95% of Americans.

http://articles.boston.com/2011-02-08/n ... -deduction
http://www.cbsnews.com/8301-503544_162- ... 03544.html


Cherry picking arguments from liberal commentators does not change the facts.

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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Tue Aug 30, 2011 7:08 am
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iNow wrote:
Interesting. My taxes have gone down, as have the taxes of 95% of Americans.



Interesting indeed.

I know what happened to my taxes and what will happen if Obama gets his way in the future. Like most retirees who have saved my taxes will go up. A lot.

The last data that I saw showed that half of all Americans don't pay any income tax, so to reduce their taxes you would have to give them some of my money, and that is probably just what happened.

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iNow
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Tue Aug 30, 2011 4:08 pm
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DrRocket wrote:
Cherry picking arguments from liberal commentators does not change the facts.

Can you please elaborate about which facts these might be, and note also that I didn't cherry-pick. A more accurate and fair way to describe what I did was to use evidence in support of my points that the nature and focus of the uncertainty is different from what you proposed.

(I must also note how fascinating I find it that you are suggesting that Nasdaq.com and the Financial Times are liberal commentators, and are choosing to cast them aside and dismiss them for that reason).


DrRocket wrote:
I know what happened to my taxes and what will happen if Obama gets his way in the future. Like most retirees who have saved my taxes will go up. A lot.

This is counter to the facts I've shared, and it appears you're making this argument because you "just know it's true." Can you please offer some evidence of this position?


DrRocket wrote:
The last data that I saw showed that half of all Americans don't pay any income tax, so to reduce their taxes you would have to give them some of my money, and that is probably just what happened.

Sorry, I should have been more clear and said this more explicitly. From the article, they are referring to working families, small businesses, first-time homebuyers, people paying for college or medical care for children, etc... and how 95% of them have seen their taxes decrease under Obama.


Quote:
Quote:
"Now, let me repeat: We cut taxes," he said. "We cut taxes for 95 percent of working families. We cut taxes for small businesses. We cut taxes for first-time homebuyers. We cut taxes for parents trying to care for their children. We cut taxes for 8 million Americans paying for college."


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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Tue Aug 30, 2011 9:41 pm
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iNow wrote:
(I must also note how fascinating I find it that you are suggesting that Nasdaq.com and the Financial Times are liberal commentators, and are choosing to cast them aside and dismiss them for that reason).


You can find commentators in any of the financial media to support any position that you want to support. Nasdaq.com, Financial Times, CNBC it doesn't matter, they present the full spectrum. The exception is the New York Times which you can usually count on to supply only the most liberal viewpoint.



iNow wrote:
DrRocket wrote:
I know what happened to my taxes and what will happen if Obama gets his way in the future. Like most retirees who have saved my taxes will go up. A lot.

This is counter to the facts I've shared, and it appears you're making this argument because you "just know it's true." Can you please offer some evidence of this position?


You're damn right I "just know" what happens with my personal taxes.

You have not shared "facts", only opinions of commentators on a politically charged issue.

And no, I will not give you specifics regarding my taxes or my income.




iNow wrote:
DrRocket wrote:
The last data that I saw showed that half of all Americans don't pay any income tax, so to reduce their taxes you would have to give them some of my money, and that is probably just what happened.

Sorry, I should have been more clear and said this more explicitly. From the article, they are referring to working families, small businesses, first-time homebuyers, people paying for college or medical care for children, etc... and how 95% of them have seen their taxes decrease under Obama.


Quote:
Quote:
"Now, let me repeat: We cut taxes," he said. "We cut taxes for 95 percent of working families. We cut taxes for small businesses. We cut taxes for first-time homebuyers. We cut taxes for parents trying to care for their children. We cut taxes for 8 million Americans paying for college."




Quoting Obama, or any politician, in support of his own policies is just about as far from truthful and objective as you can possibly get.

And when a politician says "let me repeat' you can be sure that whatever he is saying is not the whole truth and is likely just another damn lie.

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iNow
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Wed Aug 31, 2011 12:51 am
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DrRocket wrote:
You can find commentators in any of the financial media to support any position that you want to support. Nasdaq.com, Financial Times, CNBC it doesn't matter, they present the full spectrum.

I tend to agree with you here, but my concern with your approach resides in the fact that you have not addressed any of the content shared. You appear to think that calling them liberal and ignoring the points made is a valid approach to refuting them and a justifiable reason for casting them aside. It's not.

Pulling away the labels, and trying to focus on the core content, you said uncertainty is the reason the economy is weak, and you implied that the primary issue with markets is uncertainty in future regulations and taxes. I countered this point by stating that most business leaders and corporate executives are referring to a completely different thing when they mention the concept of uncertainty.

As supported by my handful of sources, and by many others which have been put forth during the past several months, the uncertainty that business leaders are most commonly discussing pertains directly to their questions about when and where growth will come from. As a general rule, they are expressing their concern that the slump will continue and demand will remain weak since the government is not investing and is showing no sign that they will, while at the same time the private sector for the last several years has seemed unable to pick up the slack without such governmental help. These business leaders may be peripherally uncertain about future regulations and taxes, but that is not their core concern (at least, not based on their direct quotes and comments).

Further, the type of uncertainty to which you're referring happens every few years (since taxes and regulations tend to change with different elected officials), and yet businesses have found ways to be successful despite this "uncertainty." All evidence points to the fact that demand is low due to high unemployment, and that putting people back to work will help resolve that.

Without resorting to saying "that's just hogwash from a liberal commentator," perhaps you can elaborate on why you hold a different perspective, and what information informs that perspective? I'm genuinely curious to understand your position, as I spend a lot of time reading and thinking about these issues and am rather confident in the accuracy of my points. If it's possible that I'm wrong, I want to know where and why so I can make corrections.

DrRocket wrote:
iNow wrote:
DrRocket wrote:
I know what happened to my taxes and what will happen if Obama gets his way in the future. Like most retirees who have saved my taxes will go up. A lot.

This is counter to the facts I've shared, and it appears you're making this argument because you "just know it's true." Can you please offer some evidence of this position?


You're damn right I "just know" what happens with my personal taxes.

You have not shared "facts", only opinions of commentators on a politically charged issue.

And no, I will not give you specifics regarding my taxes or my income.

I did not ask you to share anything specific about your personal taxes or income. I was pointing out that your comments were put forth in contradiction to the information and evidence I'd shared, and I noted that you were making these claims without putting forth any evidence to support them. I merely asked if you had evidence to support your points so I could learn more about the prospect of "our taxes going up... a lot... if Obama gets his way," and I reminded you how your personal feeling of "it's that way because I just know it is" tends to be a very poor way to communicate or support ones position.

When I asked you for evidence, I was curious to better understand your position, and hoped you might have some quotes or legislation or SOMETHING which supported your contention that your "taxes will go up... a lot... if Obama gets his way in the future." If that's the case, then it should be easy to support, and I'd genuinely like to know. Can you share any evidence or information that this is a valid concern, and what informs it? I'd genuinely like to better understand your position, and need your help to do so.


DrRocket wrote:
Quoting Obama, or any politician, in support of his own policies is just about as far from truthful and objective as you can possibly get.

Which is why I shared another source which detailed the specific tax policies enacted under Obama. I, too, know better than to rely merely on quotes from politicians when making an argument. Here is that source again, for reference: http://articles.boston.com/2011-02-08/n ... -deduction

And here's another for any interested readers: http://www.usatoday.com/money/perfi/tax ... axes_N.htm


As well as this: http://www.capitalgainsandgames.com/blo ... arty-crowd
Quote:
Quote:
According to calculations by the Joint Committee on Taxation, a congressional committee, tax filers with adjusted gross incomes between $40,000 and $50,000 have an average federal income tax burden of just 1.7%. Those with adjusted gross incomes between $50,000 and $75,000 have an average burden of 4.2%.

Even though the tea partiers were specifically asked about federal income taxes, it's possible that they were thinking about other federal taxes as well, such as payroll and excise taxes. According to the JCT, when all federal taxes are included, those earning between $40,000 and $50,000 have an average tax rate of 12.3%, and those earning between $50,000 and $75,000 pay a rate of 14.5%.

In short, no matter how one slices the data, the tea party crowd appear to believe that federal taxes are very considerably higher than they actually are, whether referring to total taxes as a share of GDP or in terms of the taxes paid by a typical family.

Tea party goers also seem to have a very distorted view of the direction of federal taxes. They were asked whether they are higher, lower or the same as when Barack Obama was inaugurated last year. More than two-thirds thought that taxes are higher today and only 4% thought they were lower; the rest said they are the same.

As noted earlier, federal taxes are very considerably lower by every measure since Obama became president. And given the economic circumstances, it's hard to imagine that a tax increase would have been enacted last year. In fact, 40% of Obama's stimulus package involved tax cuts. These include the Making Work Pay Credit, which reduces federal taxes for all taxpayers with incomes below $75,000 by between $400 and $800.

According to the JCT, last year's $787 billion stimulus bill, enacted with no Republican support, reduced federal taxes by almost $100 billion in 2009 and another $222 billion this year. The Tax Policy Center, a private research group, estimates that close to 90% of all taxpayers got a tax cut last year and almost 100% of those in the $50,000 income range. For those making between $40,000 and $50,000, the average tax cut was $472; for those making between $50,000 and $75,000, the tax cut averaged $522. No taxpayer anywhere in the country had his or her taxes increased as a consequence of Obama's policies.

It's hard to explain this divergence between perception and reality.





DrRocket wrote:
And when a politician says "let me repeat' you can be sure that whatever he is saying is not the whole truth and is likely just another damn lie.

Fair enough, but my central point (that taxes for 95% of Americans are lower under Obama) remains valid regardless of what quotes I did or did not share and by whom they were spoken.

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padren
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Fri Sep 02, 2011 1:04 am

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DrRocket wrote:
None of which requires that it originate with government spending. And everything that you name would be demanded by consumers in the marketplace.

Last time I checked, consumers can "demand" whatever they want - market response is elastic at best. When the markets lack confidence it's even worse, since no one wants to take any risks because the first company to take a risk will likely end up in a slightly weakened position to the ones that don't. It's not always a problem but when the competition literally is trying to end you so they don't have to compete with you it's the sort of risk companies just don't take.

DrRocket wrote:
Note that you have omitted the initial step whereby the money is first taken from the very people that you mention, as well as others. The government produces nothing. The government merely redistributes wealth, very inefficiently and very ineffectively.


Do you really believe this? The entire purpose of government involvement is to manage risk, which inherently costs more than doing the exact same things without risk-management overhead. Do you want "a fair price for the bridge" you drive over or do you want a somewhat more expensive bridge that won't fall into the ocean? I'm all in favor of letting the Great Invisible Hand reclaim companies that cut corners and ultimately fail - I'm just not a fan on what happens to the people when the company provides a life-and-death critical service.

There is nothing "mere" about what federal spending does at all: the police departments, fire departments, military, EPA, FDA, highways, waterways (just to name a few) all have far too much inherent risk for the free market to handle by itself, and they all provide benefits you just can't invoice for.

Even if we ignore the risk issue, and assume the free market will eventually meet whatever consumers demand - what about the meantime? Maybe the free market would have gotten us to the moon eventually without Apollo - how long would that have taken and what would the cost of starting so much later have been?


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kojax
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Fri Sep 02, 2011 9:11 am
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Falconer360 wrote:
Investment. Take the problem and scale it down in scope to that of a small town. If everyone shops at the local stores their money goes into keeping the people there employed and possibly opening new positions. However if the people of said town get tight with their cash and stop spending in the town as much, soon enough the stores have to start laying people off, no new jobs are created and people start spending even less (because they don't have jobs or are trying to squirrel away their money). I know this is an oversimplified view but it does fairly accurately describe the situation.



Suppose there are two cities both engaged in free trade one with another. City #1 takes measures to put money it its citizens hands by bolstering wages (perhaps instituting a minimum wage) and lowering taxes (so their citizens keep more of their paycheck). City #2 eliminates its unions so its stores can pay their workers less and sell products at a cheaper price, ignoring the effect on their wages.

Wouldn't all the townsfolk from City #1 head over to City #2 to spend their paychecks, leaving the storefronts in City #1 empty? How long do you think that system would last before the businesses in City #1 were forced to stop paying those higher wages?

In the last 6 years, our trade deficit with China has grown by 49% (as of 2010), in spite of a currency shift that should have increased the effective price of their goods by 29%. It's like we've been turning on the heater in our house on a cold Winter day, but left the windows open, so all the heat just flowed right out the window. It's all wasted effort if you don't insulate.

I'm not saying we should drop our wages to match theirs. That's the opposite of my thinking. It's just that when we stimulate our economy we can't let theirs become the recipients of that revenue. Otherwise we're not the recipients. We should put up some tariffs. Kill 2 birds with 1 stone. We get tax revenue out of it on the one hand, and ensure the stimulus money goes where it is intended to on the other. If China doesn't feel like paying its workers what their labor is worth, then they can pay us what their workers' labor is worth (as a tax for failing to match our policies).


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Falconer360
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Fri Sep 02, 2011 9:00 pm
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kojax wrote:
Falconer360 wrote:
Investment. Take the problem and scale it down in scope to that of a small town. If everyone shops at the local stores their money goes into keeping the people there employed and possibly opening new positions. However if the people of said town get tight with their cash and stop spending in the town as much, soon enough the stores have to start laying people off, no new jobs are created and people start spending even less (because they don't have jobs or are trying to squirrel away their money). I know this is an oversimplified view but it does fairly accurately describe the situation.



Suppose there are two cities both engaged in free trade one with another. City #1 takes measures to put money it its citizens hands by bolstering wages (perhaps instituting a minimum wage) and lowering taxes (so their citizens keep more of their paycheck). City #2 eliminates its unions so its stores can pay their workers less and sell products at a cheaper price, ignoring the effect on their wages.

Wouldn't all the townsfolk from City #1 head over to City #2 to spend their paychecks, leaving the storefronts in City #1 empty? How long do you think that system would last before the businesses in City #1 were forced to stop paying those higher wages?

In the last 6 years, our trade deficit with China has grown by 49% (as of 2010), in spite of a currency shift that should have increased the effective price of their goods by 29%. It's like we've been turning on the heater in our house on a cold Winter day, but left the windows open, so all the heat just flowed right out the window. It's all wasted effort if you don't insulate.

I'm not saying we should drop our wages to match theirs. That's the opposite of my thinking. It's just that when we stimulate our economy we can't let theirs become the recipients of that revenue. Otherwise we're not the recipients. We should put up some tariffs. Kill 2 birds with 1 stone. We get tax revenue out of it on the one hand, and ensure the stimulus money goes where it is intended to on the other. If China doesn't feel like paying its workers what their labor is worth, then they can pay us what their workers' labor is worth (as a tax for failing to match our policies).


This reminds me of the town I live in actually. The local grocery store charges more than places like walmart, and as such the people from my town drive the 50 miles to the nearest walmart or the 100 to the nearest costco and spend most of their money there. Which only damages the local store, making them raise their prices more.

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GiantEvil
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Sun Sep 04, 2011 8:50 pm
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DrRocket wrote:
GiantEvil wrote:
Highway infrastructure doesn't employ people in it's construction or do anything to generate wealth?
Education doesn't employ people or generate wealth?


Highway construction as with maintenance of the military is a necessary expense, but not an investment nor a direct generator of wealth -- you cannot sell a road (in most cases). The construction of highwaqys using federal money is an astonishingly wasteful process that takes tax money from individuals and then filters it through the federal government back through state and local governments before a single foot of pavement is laid.

Similarly education is a necessary expense. It does not generate wealth unless and until it is actually used to create wealth. Again the involvement of the federal has resulted in high cost and poor performance. The very best academic primary and secondary school that I have ever encountered is the University School in Jackson, Tennessee. It is a private school with tuition far below the average national per pupil expenditure in public schools. Despite that they routinely win academic competitions and place students in the top universities.



GiantEvil wrote:
Capital as a commons is a benefit to many citizens, capital as a personal possession is some assholes private jet. Some asshole who never received my consent to the authority of greater resource control.


Fortunately that asshole does not need your consent. It is called private property rights.

Bill Gates has done far more than you to create wealth for everyone. His jet is his property, and well earned at that. Bill is no asshole. The asshole is the person who lives off the work of others, collecting unearned money confiscated under threat of force and re-distributed by the government

GiantEvil wrote:
It all boils down to 'tool's in hand's'.
Now there's this myth that a person won't take a tool to their hand without some external reward involved, I will take a tool to my hand for the love of it. I have no reason to believe that I am uniquely exceptional in this.
The sweat of the brow is an irreducible condition of existence. I find it preferable that such sweat, after it has provided my sustenance, become a public park and not some assholes private jet.


Then spend your money as you see fit. But when you try to tell someone else how to spend theirs you play the role of a thief, effectively taking their property.

Well, fair enough. Let me modify my last sentence.
I find it preferable that such sweat, after it has provided my sustenance and some assholes private jet, become a public park and not some assholes second private jet.
Is that better?

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kojax
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Sep 05, 2011 12:16 am
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I don't see why public works can't move in a solar/wind direction now. Even if we gave the infrastructure we had produced to some private power company after it was produced (or just leased it to them), just so long as it reduces dependency on oil. According to this article someone showed me on another forum, some German guys have found a way to convert excess solar/wind energy from off peak production into methane at 60% efficiency.

http://www.sciencedaily.com/releases/20 ... 113227.htm

Quote:
"The new concept is a game changer and a new significant element for the integration of renewable energies into a sustainable energy system," adds Sterner. The efficiency of converting power to gas equals more than 60 percent. "In our opinion, this is definitely better than a total loss,"


Public works allows the building of things that aren't profitable for a private industry to do, but which have indirect benefit to the larger whole, (as well as just plain putting people to work). Certainly dependency on OPEC countries is more than just an economic plague to us. It's also a national security risk. It deserves the same kind of funding the military receives.


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iNow
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Sep 05, 2011 1:16 am
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Unfortunately, methane is 30 times more effective in trapping heat in the atmosphere than carbon dioxide.

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kojax
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Sep 05, 2011 6:20 am
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iNow wrote:
Unfortunately, methane is 30 times more effective in trapping heat in the atmosphere than carbon dioxide.


Well there is the other option: Methanol. But I don't know what the efficiency of conversion is for that. Clearly solar and wind will not be very attractive options until some kind of bulk storage medium emerges to net all that lost energy that happens when people aren't turning on their lights.

I just don't understand why we wouldn't be using public works to crank them out right now, while there's all this untapped labor laying around waiting to be used, and we need the economic stimulus anyway. Even if the tech isn't exactly optimal right now, its better than building additional highways nobody is going to drive on.


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iNow
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Sep 05, 2011 2:50 pm
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kojax wrote:
I just don't understand why we wouldn't be using public works to crank them out right now, while there's all this untapped labor laying around waiting to be used, and we need the economic stimulus anyway.

Politics, ignorance, and short-sightedness would be my guess, especially given how interest rates are at historic lows right now and we could effectively borrow for free. How perfect a fit it would be right now to do a Roosevelt-esque massive works program where we quintuple solar across the nation in the next 5 years, sextuple wind power, and subsidize high-density long storage battery manufacturing. In parallel, get crews to upgrade schools and work on long overdue maintenance issues, and get homes and buildings more energy efficient with new windows, heating/cooling systems, insulation, and efficient appliances. It would create jobs, address the environmental issues, make us less reliant on unstable countries who provide us with dirty fuels... all while helping the economy and improving our long-term outlooks.

But nope... Politics, ignorance, and short-sightedness says we must contract our fiscal policy immediately and extend the unnecessary suffering of millions.

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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Sep 05, 2011 8:49 pm
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kojax wrote:
Public works allows the building of things that aren't profitable for a private industry to do, but which have indirect benefit to the larger whole, (as well as just plain putting people to work).


Yes. This is called "pork". It is what brought you the bridge to nowhere and the ethanol debacle. It is why too many industries focus on lobbying for an artificial advantsge, when in fact the government should focus on keeping markets competitive.

If things "aren't profitable" there is likely a good reason for that. If a technology is really promising and potentially profitable in the foreseeable future, venture capital will be found to develop it. "Public works" in the form of new technologoies tends to be code for tax dollars funneled to cronies for a bad idea.

Any dollars that the government applies to such projects are ultimately dollars taken from elsewhere, usually the private sector, that could have gone to an idea that would have been more economically attractive and would have been either developed and brought to market or objectively found wanting and dropped. Public projects tend to be money sinks with no clear market strategy and no exit criteria. There are damn few engineers in congress.

If you really think your ideas have merit, then start a company to develop them. Waiting for the government is a cop out.

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kojax
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Tue Sep 06, 2011 5:29 am
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If the USA were all one giant corporation, that corporation would see a benefit in breaking its dependency on OPEC any which way it can, but there's no way to effectively divide that benefit into individual portions based on individual decisions that create individual profits. It's a pooled result that comes from a pooled effort, and capitalism is not good at rewarding that, at least not without a few ad hoc adjustments.

The problem is, like you described, once we are in the realm of ad hoc adjustments, things just go hog wild in the USA (or pork barrel wild). Companies start investing in better senators instead of better production processes.

I wouldn't knock subsidies overall though. They work pretty well in our agriculture markets.


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padren
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Tue Sep 06, 2011 8:01 pm

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DrRocket wrote:

Yes. This is called "pork". It is what brought you the bridge to nowhere and the ethanol debacle. It is why too many industries focus on lobbying for an artificial advantsge, when in fact the government should focus on keeping markets competitive.

If things "aren't profitable" there is likely a good reason for that. If a technology is really promising and potentially profitable in the foreseeable future, venture capital will be found to develop it. "Public works" in the form of new technologoies tends to be code for tax dollars funneled to cronies for a bad idea.

I think you oversimplify how venture capital works. You could say that eventually the private market would have made the Apollo program viable, but how long would that take? How long would we have sat behind the Soviets waiting for some small individual group of private investors to assume all the risk?

I think it's more than fair to describe the time lag between the moment a venture is a viable investment and when actual investors begin investing in it as a cost of free-market solutions.

What would that cost have been to find a pure-private solution for achieving the Apollo program's results?
DrRocket wrote:
Any dollars that the government applies to such projects are ultimately dollars taken from elsewhere, usually the private sector, that could have gone to an idea that would have been more economically attractive and would have been either developed and brought to market or objectively found wanting and dropped. Public projects tend to be money sinks with no clear market strategy and no exit criteria. There are damn few engineers in congress.

I agree with you there in general but you make it sound like all government subsidies are inherently pork-based and are inherently worse than private options.

Sometimes it's in the national interest of a society to take on risks together - sometimes the profit motive is either insufficient (the profit model doesn't not fit all services all that well) or the venture-risk is too high because too many benefits can "bleed off" without coming back as profit to the investors financially. Even if they benefit along with the rest of the nation in ways that invariably make the investment worth-while.
DrRocket wrote:
If you really think your ideas have merit, then start a company to develop them. Waiting for the government is a cop out.

I don't think anyone is talking about waiting for the government - just about what the government can do better than the free market can alone.


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kojax
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Thu Sep 08, 2011 10:43 am
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We know that, if alternatives take off, OPEC will be forced to lower its gas prices, and we'll all benefit from that every time we go to fill up our cars. However, if one company were to bear the entire cost of accomplishing that all on its own shoulders, then how would it go about billing the rest of us for enjoying our share of those cheap gas prices? It's the same problem an author faces when they are unable to enforce a copyright. A global benefit has been achieved at great personal cost, and the author is out that cost.

Economics, just like physics, requires one to solve the occasional math equation. If you're bearing 100% of the cost, but only able to reap a tiny sliver of a percentage of the reward, then how would that ever be profitable? The total benefit would have to be one very amazing, pie in the sky, benefit.


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DrRocket
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Sat Sep 10, 2011 1:42 am
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padren wrote:
I think you oversimplify how venture capital works. You could say that eventually the private market would have made the Apollo program viable, but how long would that take? How long would we have sat behind the Soviets waiting for some small individual group of private investors to assume all the risk?

I think it's more than fair to describe the time lag between the moment a venture is a viable investment and when actual investors begin investing in it as a cost of free-market solutions.

What would that cost have been to find a pure-private solution for achieving the Apollo program's results?


The Apollo program, and indeed the entire space program had and has nothing to do with venture capital, or government subsidies.

The space program is not tied to any commercial goals. It is a pure government initiative and research/exploration program. There is nothing inherently wrong with thsat so long as you recognize it for what itn is.

The single biggest reason for the lack of private money in space exploration is that there is no commercial incentive. Where there has been commercial incentive, for communication and ground surveillance, private industry has made the necessary investments -- I spent rather a long btime involved in some of those efforts.



DrRocket wrote:
Any dollars that the government applies to such projects are ultimately dollars taken from elsewhere, usually the private sector, that could have gone to an idea that would have been more economically attractive and would have been either developed and brought to market or objectively found wanting and dropped. Public projects tend to be money sinks with no clear market strategy and no exit criteria. There are damn few engineers in congress.


padren wrote:
I agree with you there in general but you make it sound like all government subsidies are inherently pork-based and are inherently worse than private options.

Sometimes it's in the national interest of a society to take on risks together - sometimes the profit motive is either insufficient (the profit model doesn't not fit all services all that well) or the venture-risk is too high because too many benefits can "bleed off" without coming back as profit to the investors financially. Even if they benefit along with the rest of the nation in ways that invariably make the investment worth-while.


Government subasidies are almost always a waste (I can't think of any exceptions). But there are some projects that are appropriate for the government to fund. Basic reserch is one, and universities do an excellent job. If you think we should explore space, then that is another. I have no problem with appropriated, targeted government projects. They can be justifiable EXPENSES.

But to confuse a government project with an investment is to just fool yourself. And the word "investment" when used by a politician is code for "pork".

DrRocket wrote:
If you really think your ideas have merit, then start a company to develop them. Waiting for the government is a cop out.

I don't think anyone is talking about waiting for the government - just about what the government can do better than the free market can alone.[/quote]

And that is actually damn little in the context of things that produce an economic return in the near or mid-term. What government can do and does with regularity is distort the market, complicate business, and screw upriorities. Ethanol emphasis is a prime example.

You can take Social Security as another example. I will never recover what I have contributed. But had I had that money to invest in what was my 401K it would have easily provided an additional $1million towards my (current) retirement.

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kojax
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Sun Sep 11, 2011 10:35 pm
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DrRocket wrote:
Quote:
Quote:
Any dollars that the government applies to such projects are ultimately dollars taken from elsewhere, usually the private sector, that could have gone to an idea that would have been more economically attractive and would have been either developed and brought to market or objectively found wanting and dropped. Public projects tend to be money sinks with no clear market strategy and no exit criteria. There are damn few engineers in congress.


padren wrote:
I agree with you there in general but you make it sound like all government subsidies are inherently pork-based and are inherently worse than private options.

Sometimes it's in the national interest of a society to take on risks together - sometimes the profit motive is either insufficient (the profit model doesn't not fit all services all that well) or the venture-risk is too high because too many benefits can "bleed off" without coming back as profit to the investors financially. Even if they benefit along with the rest of the nation in ways that invariably make the investment worth-while.


Government subasidies are almost always a waste (I can't think of any exceptions). But there are some projects that are appropriate for the government to fund. Basic reserch is one, and universities do an excellent job. If you think we should explore space, then that is another. I have no problem with appropriated, targeted government projects. They can be justifiable EXPENSES.

But to confuse a government project with an investment is to just fool yourself. And the word "investment" when used by a politician is code for "pork".


That is a good limiting condition. Research is a fine example of something that has a local cost but potentially a global benefit. If patents are granted, then the benefit would remain local, but not all research leads to outcomes that would enjoy sufficient protection that way, and keeping it secret is kind of a waste.

Private industry will never be good at achieving those things, not without a lot of cooperation, and cooperation can lead to collusion....

DrRocket wrote:
Quote:
Quote:
If you really think your ideas have merit, then start a company to develop them. Waiting for the government is a cop out.

I don't think anyone is talking about waiting for the government - just about what the government can do better than the free market can alone.


And that is actually damn little in the context of things that produce an economic return in the near or mid-term. What government can do and does with regularity is distort the market, complicate business, and screw upriorities. Ethanol emphasis is a prime example.


China's command economy distorts the market by artificially keeping its yuan/renminbi low. The governments that make up OPEC distort the market by colluding to keep oil prices high. If either of these things goes unchecked, our market driven system won't fare very well. But there's no "obeying market economics" way to counter a "disobeying market economics" tactic by someone else.

At some point we just have to accept that we can't have our ideals.


Quote:
You can take Social Security as another example. I will never recover what I have contributed. But had I had that money to invest in what was my 401K it would have easily provided an additional $1million towards my (current) retirement.


In theory, Social Security has zero risk. That's meant to make up for the lack of high returns. If the economy had performed even more poorly than it has, like if the Commies had won the Cold War or something like that, then maybe you'd be worse off than you are. Hindsight is 20/20, so of course it's easy to say it was a bad idea after you've seen all the outcomes.

Hearing people talk about discontinuing it makes me sad, because it takes the "zero risk" part out of the investment....... at which point it really does become a bad idea to keep it.


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iNow
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Thu Sep 29, 2011 3:55 pm
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DrRocket wrote:
What has failed is government attempts (2 of them) at "stimulus" and the failure is due in part to the uncertainty among business leaders as to the future impact of government regulations. Similarly, demand by consumers and small business is inhibited by uncertainties.


In addition to my original response, there is this:


http://www.epi.org/publication/regulato ... planation/
Quote:
What the heavily politicized trade associations in Washington (like the Chamber) are saying does not correspond to the real challenges facing both large and small businesses, even as they themselves perceive them.

<...>

It is worth mentioning that this “regulatory uncertainty” argument requires its proponents to have a particularly peculiar form of amnesia, given that the worldwide economic collapse we are now experiencing is due to a failure to sufficiently regulate financial markets.

<...>

Instead of uncertainty about regulations, there is strong evidence that the absence of job creation reflects the continued unwinding of the financial collapse and the corresponding lack of demand. Firm investments and hiring are lower because they have ample capacity to produce the goods and services they are selling to a shrunken market, while firms are deleveraging at the same time.

<...>

A simple review of investment and employment trends—what businesses are actually doing— reveals that employers are not behaving according to the narrative described in the uncertainty story: employment and investment trends are what one would expect (or better) given the trends in the overall growth of the economy (i.e., the actual growth or shrinkage of GDP).

Let us start by comparing investment, specifically investment in equipment and software, in the first two years (which is where we are now) of each of the last four recoveries.

<...>

Another set of data also calls into question the “regulatory uncertainty” argument. If firms were nervous about hiring new employees but had immediate profitable sales opportunities (say, before new regulations are established), then they could readily increase the weekly work hours of current employees to produce more goods and services.

<...>

If you look at what employers are doing rather than what the trade associations and their allies on Capitol Hill are saying, then recent employment and investment behavior is easy to explain—investment and employment/unemployment are what we would expect in a severe downturn followed by a slow growing economy in the recovery. There is no shift from historic patterns, and there does not seem to be any evidence that fears of future regulation are shaping the slow growth and weak employment gains we have seen.

<...>

  • The vast majority (80 percent) of those surveyed believe the current regulatory environment is good for American businesses and the overall economy.
  • The large majority of business economists believe concerns about economic uncertainty are a proxy for generalized concerns about the bad economy. (That is, the concerns do not reflect business worries about regulation.) Few believe economic uncertainty is a major concern that is holding back economic progress.

In conclusion, when looking at both what employers are doing in terms of hiring and investing and what they (and their economists) are saying in private surveys, it’s nearly impossible to make the argument that uncertainty about regulations is holding back the economy.
<read more>

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iNow
Post  Post subject: Re: US Politics: King for a Day - What would you do?  |  Posted: Mon Oct 10, 2011 7:25 pm
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MOD NOTE: The 9/11 re-investigation discussion has been split into its own thread. Please direct any further comments on that topic here: topic245.html

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