Conservatives vs Liberals

[Gummug]

The mission of socialism is, to the contrary of what many claim who have never read a book about socialism, not the distribution of wealth (that in a socialist state would not exist) but to equalize the possibilities of all.

Well, if wealth does not exist in a socialist state, what possibilities would there be for anyone? For anything?

[Frank Merton]

Well, if wealth does not exist in a socialist state, what possibilities would there be for anyone? For anything?

Wealth certainly exists in Vietnam, as also does poverty. The economic difference is I would say one of degree: large enterprises always have at least one competing enterprise that is entirely state-owned and there is usually a degree of state participation in all large enterprises. Small businesses are almost entirely private, and it is quite easy to get a license to open one (the usual tests -- legality, unique name, environmental rules, etc.). I would say the legal restrictions on most small business are much less than those of the States, in many ways.

[spartan max2]

The way I see it, when I was young, in the 1960's the biggest employer was General Motors, who was paying their union employees what would be the equivalent of about 50 bucks an hour today and the economy was fine. Then came the Reagan revolution and supply side economics and NAFTA etc. and the largest US employer today is Wal-Mart, paying their employees 8-15 bucks an hour and everything has went to hell. Do you not see a trend here? I admit I'm no expert on economics but this can't be coincidental can it?

I think the real issue is inflation. We all like to talk about unions and minimum age issues/debates alot but the real issue is inflation, which is from our debt. When we flood the system with paper, by printing more out daily that paper becomes worthless. The higher are debt is the worst our inflation will be. Minimum wage and unions wanting more money for its members would not even be an issue if it was not for the increase of our inflation daily.

At least this is how i see it.

[Frank Merton]

Inflation is harmful when it is erratic or extreme; deflation is even more harmful, even in small doses. Trying to keep prices at a stable level is essentially impossible since even measurement of things like new features is nigh onto impossible, so the best course is to keep a lid on inflation but not try to eliminate it lest you cause deflation.

[Bama13]

The way I see it, when I was young, in the 1960's the biggest employer was General Motors, who was paying their union employees what would be the equivalent of about 50 bucks an hour today and the economy was fine. Then came the Reagan revolution and supply side economics and NAFTA etc. and the largest US employer today is Wal-Mart, paying their employees 8-15 bucks an hour and everything has went to hell. Do you not see a trend here? I admit I'm no expert on economics but this can't be coincidental can it?

What does the Reagan revolution and supply side economics have to do with NAFTA? Oh, I see, the economy was doing well until the Federal Government decided to take a larger roll. I agree.

[Gummug]

Wealth certainly exists in Vietnam, as also does poverty. The economic difference is I would say one of degree: large enterprises always have at least one competing enterprise that is entirely state-owned and there is usually a degree of state participation in all large enterprises. Small businesses are almost entirely private, and it is quite easy to get a license to open one (the usual tests -- legality, unique name, environmental rules, etc.). I would say the legal restrictions on most small business are much less than those of the States, in many ways.

I wouldn't doubt that a bit. Unfortunately, we're having imo too much socialist take-over. (I'm probably straying from the textbook definition of socialist, but I'm referring to bureaucracy upon bureaucracy and regulation upon regulation as being socialist.)

[Frank Merton]

I think of an enterprise as being socialist if the government or some unit of the government (such as a municipality) has legal title to the enterprise, provides the working and initial capital, takes the risks, appoints the managers, determines broad policy, and either plows the profits back into the company or pockets them.

There are also all over the world lots of joint enterprises where government has a position, sometimes controlling although often just to incentivize foreign investment by helping out with capital and tax breaks.

Bureaucracy is common to both government owned and private enterprises and naturally grows as is well known, and is the reason start-ups so often are so much more effective than long-established businesses (that and the accumulation of legacy commitments). This is also known as the dynastic cycle to students of Chinese history. State enterprises seem to have an advantage in being able to tap the taxpayer for more money, but the reality is this is rarely really so, as political opposition can be harder to overcome than finding new private money.

Regulation is another issue; when something bad happens in any society there is a clamor to "do something," and this almost always leads to new rules and new policemen to enforce the new rules, creating in the process more work for more lawyers. I guess that is just a part of human history and sooner or later catastrophe happens and the deck is cleared.

[Guest]

I wouldn't doubt that a bit. Unfortunately, we're having imo too much socialist take-over. (I'm probably straying from the textbook definition of socialist, but I'm referring to bureaucracy upon bureaucracy and regulation upon regulation as being socialist.)

Indeed you are straying from the text book definition of socialism. Regulation can happen in any system - and it tends to proliferate in socially conservative (read Republican) administrations. For all the bluster of deregulation coming from the Conservatives, the burden of regulations have grown under every administration regardless of political colour.

Br Cornelius

[spacecowboy342]

I think the real issue is inflation. We all like to talk about unions and minimum age issues/debates alot but the real issue is inflation, which is from our debt. When we flood the system with paper, by printing more out daily that paper becomes worthless. The higher are debt is the worst our inflation will be. Minimum wage and unions wanting more money for its members would not even be an issue if it was not for the increase of our inflation daily.

At least this is how i see it.

I would have to agree that inflation is the problem that does the most damage. Still wages have not kept pace with inflation so, although it has become fashionable to bash the unions I don't see how it's fair to blame labor for inflation. The banks borrow money from the fed at 0 interest rates just to accrue interest on it. Something of a money farm. This can't be good

[spacecowboy342]

I wouldn't doubt that a bit. Unfortunately, we're having imo too much socialist take-over. (I'm probably straying from the textbook definition of socialist, but I'm referring to bureaucracy upon bureaucracy and regulation upon regulation as being socialist.)

What does the Reagan revolution and supply side economics have to do with NAFTA? Oh, I see, the economy was doing well until the Federal Government decided to take a larger roll. I agree.

NAFTA is just an example of the perils of free trade. Ross Perot was a loon but he was right about one thing. That sucking sound of jobs leaving the country

[Yamato]

I would have to agree that inflation is the problem that does the most damage. Still wages have not kept pace with inflation so, although it has become fashionable to bash the unions I don't see how it's fair to blame labor for inflation. The banks borrow money from the fed at 0 interest rates just to accrue interest on it. Something of a money farm. This can't be good

So you agree that inflation is the problem and yet you don't want to fix the problem. You want to adjust wages according to it. That's nursing the problem. That's the way to keep it around forever.

Incessant, endless, regulated inflation. It's what we're told to believe in. And anyone who owns anything as an investment is much obliged for our belief.

[Frank Merton]

Inflation rewards spenders and debtors and punishes savers and lenders. This however can be handled so long as inflation is low with various legal indexing plans, and I always saw to it that our contracts had such a clause.

Deflation is so much worse as it generates unemployment and puts collateral underwater, thereby punishing everyone.

Both have a tendency to feed on themselves if not checked, but a deflationary spiral (a depression) should at all costs be avoided, even at the cost of a little inflation. It is just not possible to assure stable prices because the economy is so complex and the elements so difficult to measure and the constant time lag in the effect of measures. It is far better in terms of honesty with the public to accept a small but steady inflation than to take the dangerous measures needed to stamp out the last vestiges of inflation.

[Yamato]

Inflation rewards spenders and debtors and punishes savers and lenders.

Inflation rewards consumption and investment, and especially investment spending, as those are the two biggest drivers of economic growth in the US economy. It rewards spending more now because a dollar today is worth more than a dollar tomorrow.

We're even called "consumers". Consumerism is the economic system we really have. It's not free market and it's not socialist either, which are useless and convenient arguments making misplaced attacks.

Prices should rise and fall in accordance with conditions in the marketplace, not stamped down into a +3% sludge. Stable prices mean they don't change, an endless rise a hundred years long is anything but. I'd be more tolerant of this control over our money if prices dropped 3% per year as often as they rise. So some people panic and prices go down. Nobody complains when they're exuberant and prices go up. How Keynesian of us.

[Frank Merton]

The problem I have of allowing prices free range to increase or decrease in accordance with market conditions is that price levels tend to be self-reinforcing sleds that go faster and faster in whatever direction they are already going until there is real pain.

Therefore they must be managed, although I agree that a set publicly announced target is a bit too much, and impossible to do anyway.

[spacecowboy342]

So you agree that inflation is the problem and yet you don't want to fix the problem. You want to adjust wages according to it. That's nursing the problem. That's the way to keep it around forever.

Incessant, endless, regulated inflation. It's what we're told to believe in. And anyone who owns anything as an investment is much obliged for our belief.

No I want wages to go up and inflation to go down. Do you see the problem being fixed? No one will address the problem of runaway military spending. Maybe that is impossible at this point as our economy is based on it now. But regardless people need to make a living. Cutting taxes for the wealthy ain't gonna do it. Again raising wages isn't what's causing the inflation. Taxes have to go up and spending has to come down. And not just spending programs for the poor.

[Frank Merton]

No I want wages to go up and inflation to go down.

You remind me of the little old lady complaining to the bank officer that her interest rate on her mortgage needs to be lowered and the rate the bank pays her on her savings needs to be raised.

[Yamato]

No I want wages to go up and inflation to go down. Do you see the problem being fixed? No one will address the problem of runaway military spending. Maybe that is impossible at this point as our economy is based on it now. But regardless people need to make a living. Cutting taxes for the wealthy ain't gonna do it. Again raising wages isn't what's causing the inflation. Taxes have to go up and spending has to come down. And not just spending programs for the poor.

I'm not arguing that, at all. What I'm saying is, raising wages is a reaction to inflation, not a solution.

Taxes have to go up and spending has to come down.

You can't bring prices down and then keep the wages up. The wages should be commensurate with prices and unfortunately they're not because we have both chronic inflation and the minimum wage, the latter which gets redressed every 10-20 years or so, lagging ridiculously behind cost of living increases. And that's good enough? Another bag of jellybeans from the Candy Man and we're happy again?

[Yamato]

The problem I have of allowing prices free range to increase or decrease in accordance with market conditions is that price levels tend to be self-reinforcing sleds that go faster and faster in whatever direction they are already going until there is real pain.

Therefore they must be managed, although I agree that a set publicly announced target is a bit too much, and impossible to do anyway.

There is real pain anyway, so we shouldn't be too eager to immunize ourselves from it.

[Frank Merton]

There is real pain anyway, so we shouldn't be too eager to immunize ourselves from it.

Some pain is not the same as the economy grinding to a halt and riots in the streets.

[spacecowboy342]

I'm not arguing that, at all. What I'm saying is, raising wages is a reaction to inflation, not a solution.

You can't bring prices down and then keep the wages up. The wages should be commensurate with prices and unfortunately they're not because we have both chronic inflation and the minimum wage, the latter which gets redressed every 10-20 years or so, lagging ridiculously behind cost of living increases. And that's good enough? Another bag of jellybeans from the Candy Man and we're happy again?

Wages or at least the minimum wage should keep pace with inflation. I realize this isn't a permanent solution but it would at least give some relief to those who are trying to survive. We need to go back to pre Reagan tax rates and cut defense drastically. Why must all the pain be endured by the poor?

You remind me of the little old lady complaining to the bank officer that her interest rate on her mortgage needs to be lowered and the rate the bank pays her on her savings needs to be raised.

And it does. Banks are the reason we are in this mess. They borrow money from the fed at 0 interest just to earn interest on it then make faulty loans, and every time their greed blows up in their faces they come begging for bailouts. Banking is nothing but a worldwide Ponzi scheme that is destined to collapse. You can raise wages and freeze prices. Nixon did it. Edited May 2, 2014 by spacecowboy342

[Yamato]

Some pain is not the same as the economy grinding to a halt and riots in the streets.

The economy benefits from lower prices! Even the people who sell stuff have to buy stuff. You're mixing up the economy with Wall St I'm afraid. Yes when Wall St. suffers the underlings surely do as well. But I'm not going to believe that nothing good ever came out of riots in the streets.

[Yamato]

Wages or at least the minimum wage should keep pace with inflation. I realize this isn't a permanent solution but it would at least give some relief to those who are trying to survive. We need to go back to pre Reagan tax rates and cut defense drastically. Why must all the pain be endured by the poor?

Yet instead of squabbling over the relief, let's solve the problem and stop guaranteeing the need for that relief.

[spacecowboy342]

Yet instead of squabbling over the relief, let's solve the problem and stop guaranteeing the need for that relief.

Fine. But it's never going to happen. Nothing's going to change.

[Gummug]

Inflation is harmful when it is erratic or extreme; deflation is even more harmful, even in small doses. Trying to keep prices at a stable level is essentially impossible since even measurement of things like new features is nigh onto impossible, so the best course is to keep a lid on inflation but not try to eliminate it lest you cause deflation.

Deflation is harmful? How? Think, you could put money in a box, bury it, and when you dig it up years later, it will be worth more than when you buried it! (Instead of less, which it would be under inflation)

[Gummug]

It started with Reagan's tax cuts for the rich and 500 ship navy. Supply side economics.

But I thought that under Reagan the national debt was reduced...I may have to research that, I'll admit....