I am sure Chile, Cuba, &c. really have a higher living standard than America, and they have one good welfare state.
Even if the answer is no, what does it matter? It is not a matter of having the resources for it. If you have industry, you have the necessary conditions.
Really? Do you seriously contend that people pop in and out of the top 0.1% all the time? I don’t think anyone would contest the assertion that the rich have gotten richer and the poor poorer in this country over the last 30 years. Now, there’s nothing necessarily wrong with this. But I don’t think I’m making a very big leap when I infer from these statistics that these develpoments have probably not contributed significantly to class mobility. Why would they? In fact, I think that to dispute the claim that our society has a real problem with inequality is dishonest.
[quote]A large delta between upper income and lower income tells me that there is opportunity for advancement and increased income. What sounds better to a recent college grad:
If you work hard young Ryan, some day you can make a bit more than your starting salary.
…or
If you work hard young Ryan, some day you can make 10 times your starting salary.
[/quote]
A large gap upper and lower income levels is not a problem and is not what I am criticizing. But when the total wealth owned by the richest subset of the population reaches such (oftentimes literally) criminal levels, it endangers the economy, as aggregate demand becomes insufficient to maintain accumulation, and thus production (witness all the forms of credit available today–this is an artificial way to sustain accumulation). This is simply a fact. The whole point of production, eventually, is consumption, but when the general population’s income is held down so low that they are not able to purchase what they have produced, production crashes. Obviously, this is bad on a society-wide level, but it is in every individual firm’s interest to seek this holding-down of wages. This is one of the central contradictions in capitalism that makes it unstable, and it is the reason why redistributive programs are effective stabilizers.
Second, the scenario you present is hopelessly fantastical. The average citizen can never hope of anything approaching the augmentation in income that you suggest. This is another popular capitalist myth: hard work is rewarded. Sometimes, but not reliably and almost never in proportion to the work done. Wages have been sideways for 30 years, except for the top income brackets.
Without trying to be insulting, I’m not sure why capitalists can’t seem to move past the “fairness” argument. Is it because, deep down, they know capitalism is unfair, and so they’re defensive about it? It doesn’t seem to compute for them that someone could offer a non-morality-based criticism of capitalism.
At any rate, nowhere in my post did I say anything about fairness, and it has nothing whatever to do with my argument. The point is not to find a “fair” gap, it is to find a gap that doesn’t threaten the economy.
You’re conflating things. There is no danger in the mere fact of not being compensated in proportion to increased levels of stress or harsh working conditions. If it is a danger, it is only so insofar as it is perceived to be unfair by those who do the work, and only dangerous to the extent that it influences any actions they take which could prove to be detrimental.
History says we need them. I’m sorry, the picture you paint is simply flat-out fabricated, a point I have made many times. The history of capitalism in this country has been extensively whitewashed. Yes, there was a time when the economy was much less regulated, and it was also a period in which we had a recession or depression approximately every 7 years (pre-Fed, by the way), people made the modern equivalent of roughly $25 a week for ~60 hours worked (probably less if you were a woman), and people routinely died working on the railroads, mines, and canals. I find it staggering that this is what Libertarians want to return to.
Read How the Other Half Lives.
My claims are based on much more than correlation.
[quote]Brother Chris wrote:
I am sure Chile, Cuba, &c. really have a higher living standard than America, and they have one good welfare state.[/quote]
I thought Chile was an “economic miracle,” an example of laisse-faire success?
As far Cuba goes, they do have quite a good standard of living. They have virtually no poverty, the entire population lives in sanitary conditions, they have free universal health care. One out of every 4 doctors in the Caribbean is Cuban. They have not been a dynamo of growth, but this is to be expected. Imagine if we were Cuba, a tiny island, and Al Qaeda was the United States. That’s basically the situation. Considering our stranglehold on their economy, their successes are quite impressive. Think about it. Why the travel ban? As William Blum pointed out, if Cuba were half as bad as we make it out to be, the government would pay you to go there and see it.
[quote]Ryan P. McCarter wrote:
Even if the answer is no, what does it matter? It is not a matter of having the resources for it. If you have industry, you have the necessary conditions.
[/quote]
Small countries with valuable natural resources can be less enterprising and still have a very high standard of living. Comparing different countries is difficult in general, but this matters quite a bit.
I do. I also contend that many in the bottom 5-10% don’t stay there for very long. I remember reading a couple of sources I got out of a Thomas Sowell book, but don’t know that I could easily dig them up. If you are really interested, do a little digging or read some Thomas Sowell. I believe the source was from his Economic Fact and Fallacy (or something like that) book.
The poor have not gotten poorer in absolute terms. The poor have what would have been considered luxuries by the middle class not to long ago. As long as the standard of living is increasing for everyone, why do we care if the increases have been larger for some? Who says they didn’t work a little harder or longer for it? Who says they didn’t take more risk?
Again, you are wrong. Large %s of people in the lower income levels make it into the upper levels. There is tremendous opportunity in the country. How many people in the upper income classes started out at a very low wage?
I worked for minimum wage and slightly above for many years. I was dead broke during college and for more than a few after. I am far from broke now. This all came from sacrifice and effort including very long hours, lots of travel and time away from family, high stress, and high risk with start-up companies. It didnâ??t pay out for many years. I changed positions and companies many times, all of which carried risk and lots of stress.
My career could have taken a different turn at any point, with the outcome being much different. I certainly wouldnâ??t have blamed capitalism. Every thing I have done has been by my own free will, and any sacrifices that I make carry the risk of not paying out.
Why shouldn’t I be in much higher income bracket than someone that chose not to take the same path and make the same sacrifices? I would not have done this for twice my starting salary. I did/do it for hopes of 10x my starting salary. I will not remain in this income bracket for long. The hours, the stress, and the time away from family are not worth it. This is why may do not stay in the higher income bracket forever.
With out the incentive of making many multiples of a normal salary, many people like me would not put in the extra effort and sacrifice. Plain and simple Ryan.
Why do you care about total wealth or income for any particular person if the standard of living and material wealth is increasing for the people as a whole? If you can not, in a practicle manner, distinguish wealth created by extra work and sacrifice and wealth created by luck, happenstance, or criminal activity, then why even bother using those stats? Gov’t should protect us from coercion and fraud.
Beyond that they are terribly inefficient at deciding who deserves what. That’s what the market is for. We all decide what we buy and at what price. We all decide where and how much we work, and what that is worth to us. This is the market.
Ryan. Where to start? You really should read some basic economics. I’ve recommended a few to you in the past. If you like books on CD, I would even borrow you some. I’ll even pay the postage if you pay to send them back. Just a couple of points.
First, you focus on income when all we really should be discussing is wealth or standard of living. Again, the “poor” have luxuries only the “rich” could afford just a few generations ago. Gov’t did not create these luxuries. They did not create the wealth that pays for these luxuries. If anything they have held us back and “poor” could be much better off if the market were allowed to operate more efficiently.
Secondly, firms can wish to hold down wages all they want. This does not insure low wages. There is equal pressure to raise wages far beyond what the market would bare. In general, the wage that is settled on is the wage the market will bare for that work. Unless you belong to the UAW or some other protected class.
Not true. I am a living example of this and I would consider myself quite average. Others in my family with the same upbringing, intellect, and education have not had the same outcome.
They chose to be employed doing some t they like, spend more time with family, see their kids during the week, participate in regular social activities, leave all work concerns at work when they punch out at 5pm, etc. This is all just fine and I envy them, but it does not mean they will receive the same compensation as I do.
I’ll spend a few years at the top of the income bracket so that I can do what they do and not worry about retirement and other monetary concerns. For some reason, this is problem for you.
The wages you speak of are wages for a particular job done a person at a particular skill level. I would not expect to be making as much had my title and responsibilities changed.
Wages donâ??t need to go up for quality of life and material wealth to increase.
You don’t have to worry about being insulting. I could really give a shit about fairness other than offering protection from fraud and coercion. Fairness is too arbitrary to concern myself with, other than basic legal protection.
Until you spend some time actually studying economics, you will not be able to offer anything other than regurgitated criticisms. You will not be able to dissect the criticisms you regurgitate. Capitalism is far from perfect but it offers the most efficient way to increase the overall standard of living for a large group of people.
You will never find this, much less find a way to regulate or enforce it effectively. The gap is not an input to a successful economy. It is an output. In other words it is a symptom not a cause, and not necessarily of something bad.
I think we’ve covered this above, but I will restate. The higher the potential reward, the more people will be willing to sacrifice in the way of time, stess, and risk. I would not do what I do if I could only make 2x an average salary. This would be lost productivity and wealth to economy as a whole. This is very, very simple Ryan.
No one wants to return to this, nor would we with less regulation. To argue the fact would be silly.
Why were people willing to work for $25 a week at this specific period in time? Could it be that this was a better option than they had previously? If it wasn’t an improvement in quality of life, they would have stayed on the farm or continued to do what ever else they were doing. If the risk of dying on the railroad was not worth the pay to people actually doing the work, they wouldn’t have done it.
I trust the free will of people who chose this line of work for the pay they did. If they were forced or coerced into this line of work, then they should have been prosecuted. Maybe our federal govâ??t should put more resources into the legal system, rather than trying to regulate and manipulate every part of the economy? Maybe this would better ensure a just working environment?
Libertarians (If I can speak for them all) want to return to a time where employee and employer agree to a fair wage. If one party doesn’t agree to the terms, they walk away. Libertarians want to return to a time where the consumer decides who is qualified to sell them food, provide medical care, represent them in court, etc. Libertarians realize how inefficient central planning and regulation can be, and how much better off all Americans would be if we were more efficient.
If itâ??s available on CD, I’ll pick it up. I am running out of books to listen to while spending endless hours in the car. Hours most in lower income brackets are probably spending with friends and family, or on hobbies.
Chickens come home to roost
Such as Cuba, which maintains their social services with little more than sugarcane? No, it is not a simple matter of “being able to afford it.” To put it in these terms implies that it is a simple expense, a payout. In actuality, it is more along the lines of an investment, and the programs themselves help foster a strong internal market and a stable economy, which pays for the programs.
You realize the top 0.1% make over $1.5 million per year, correct? How exactly does it happen that someone makes it one year and falls out the next? Not many people are capable of making a salary like that for a couple of years, and then are unable to make the same salary. Few are able to make those kinds of gains in the stock market once, and then not again. Please do explain this to me.
As far as Thomas Sowell goes, I have a little more free time now, and so maybe I will look at the book you mention, but you would do well to be highly suspicious of Sowell. He is notoriously unreliable, and usually cherry-picks information to make his case.
It matters because, as I have said, the increase is built on an enormous debt bubble; it is artificial, and unsustainable. Here is a pretty good graph illustrating this:
http://dollardaze.org/blog/posts/2007/July/17/1/DebtUSTotal.gif
The financial crisis represented “the return of the repressed.” In other words, the recession is reality, the essential nature of our predicament, not a temporary deviation from it.
I’m sorry, there is simply no way that income for upper classes can grow so quickly to the detriment of the lower classes, and for class mobility to increase at the same time, especially when economic growth rates have been decreasing. You’re telling me 2 + 2 = 5. Here is an excellent graph based on CBO data for the period most relevant to the discussion, 1979-2004:
[quote]I worked for minimum wage and slightly above for many years. I was dead broke during college and for more than a few after. I am far from broke now. This all came from sacrifice and effort including very long hours, lots of travel and time away from family, high stress, and high risk with start-up companies. It didn�??�??�?�¢??t pay out for many years. I changed positions and companies many times, all of which carried risk and lots of stress.
My career could have taken a different turn at any point, with the outcome being much different. I certainly wouldn�??�??�?�¢??t have blamed capitalism. Every thing I have done has been by my own free will, and any sacrifices that I make carry the risk of not paying out.
Why shouldn’t I be in much higher income bracket than someone that chose not to take the same path and make the same sacrifices? I would not have done this for twice my starting salary. I did/do it for hopes of 10x my starting salary. I will not remain in this income bracket for long. The hours, the stress, and the time away from family are not worth it. This is why may do not stay in the higher income bracket forever.[/quote]
Two things here: first of all, congratulations. I do not begrudge you one cent you have earned, nor do I believe that you ought not to be in the position you are. But again, you’re addressing the wrong argument. I never said you “shouldn’t” in a moralistic sense, I only said that if incomes are too skewed towards the upper brackets, the economy suffers, which is a fact. Come to any normative conclusion you wish, I am simply pointing out that there is a very valid functional purpose to redistribution.
Second, you misunderstand. Even to the extent that I have a problem with very high incomes, it is not really the income itself which is the source of the problem, and this is the reason why I don’t see any problem with your high income. The source of your income, I take it, is your work. You are likely paid a salary. Now, I’m sure you have some assets in stocks or bonds, etc., but if you were to stop working, you likely could not maintain your current standard of living, correct? This is the qualitative difference between the bourgeoisie and the rest of the population in the Marxist analysis, a very commonly misunderstood aspect of his system. It is not a specific income level that is the problem, it is the different sources of income. The bourgeois does not derive the majority of their income from work, but from the property they own. They need not work to maintain the standard of living, and this is the source of the tensions between them and the rest of society.
Please don’t insult my intelligence by making a wrong argument. It’s doubly irritating.
I again ask you to address the points I make, not imagined ones. It is because the purpose of the production of goods or the rendering of services is for them to be consumed. It is only this consumption that can afford a profit to the seller. Now, when one considers the entire product of society in a given period of time, if the population has insufficient income to purchase this entire quantity, production in the aggregate will decrease, since someone in the economy is not making enough revenue to maintain production at its current level. If it drops low enough that this happens to a significant number of people, unemployment will result, which further decreases the total purchasing power of the population, leading to further falls in production and increases in unemployment. This is otherwise known as a recession, and it is for this reason that the population must have the resources to purchase the entire quantity of goods they produce.
The market has decided the upper classes deserve the whole surplus, which is destructive to the economy. I’m sorry, but if stability is something you desire and social tumult something you wish to avoid, then some amount of government action is necessary.
I will ask you again to please not insult my intelligence. I do a fairly good bit of economic reading, and the fact that I disagree with you is not evidence to the contrary. Someone like Joseph Stiglitz disagrees with you, too. Would you tell him to “read some basic economics?”
It is you who is mistaken here, as you continually focus on irrelevancies. I can understand why you wish to focus on standard of living, but it is not sufficient for these purposes, because it is not the standard of living that purchases goods. Rather, it is the inverse, the result of the types and quantites of goods produced. As I have already pointed out to you, and to which you have yet to respond, irrespective of any moral or ethical concerns, from a technical point of view, people must be able to buy a certain amount of “stuff” to maintain production (and thus employment) at its current level. Thus, we see that there is a minimum level of consumption which is necessary to maintain the market and to set the stage for future growth. This is contrasted with the needs of the capitalist class, which has a comparatively miniscule set of consumptive needs, and instead requires consumption in general be held down as low as possible, so that the maximum amount of resources can be diverted to investment, and (hopefully) further profits. Yet by their collective actions, advantageous to the individual capitalist, they cut away the ground from beneath their feet.
It is this which necessitates an examination of income, and not simply living standards, which are inapplicable here.
Actually, in many cases, they did. In addition to providing the foundational infrastructure, services, and conditions necessary for the market to function (which the market is incapable of doing by itself), the government has in fact created many things which the private sector now operates to its own benefit. Just as an exmaple, governments had central roles in the development of the computer and the Internet.
Then how do you explain wages that have been stagnant for thirty years?
Oh please. What is it about Libertarians that makes them have no problem with the management and owners of large banks, manufactories, wealthy investors, etc. yet the few remaining strong unions in the US draw constant ire? What makes it OK for suits to make millions, and sometimes billions of dollars per year for moving money around, while workers who actually produce useful goods, are the target of derision for their $20 and $30 an hour? Get real, there is a protected class in the US, but it’s not unionized workers.
Well, regardless of what you consider yourself, the fact is it is not average. The fact that it rarely happens doesn’t mean that everybody but you is lazy. I realize everyone always likes to think that luck had nothing to do with their success, but it frequently does. Now, I am not saying that luck is responsible for your success, but if you claim that “anyone can make $100,000 a year,” or some other nonsense, then you’re out of your mind, and the statistics show this. Ignoring a problem doesn’t make it go away.
Yeah, I’m sure all the people out there working two jobs and still barely getting by are having a GREAT time “participating in regular social activities,” and “spending time with their families.”
This objection is also due to your aforementioned misunderstanding, which I hope I have cleared up.
[quote]The wages you speak of are wages for a particular job done a person at a particular skill level. I would not expect to be making as much had my title and responsibilities changed.
Wages don�??�??�?�¢??t need to go up for quality of life and material wealth to increase.[/quote]
I’m not sure how you claim to be such an astute observer of the economy while ignoring such broad swaths of it. On the average, wages have not increased in 30 years, except for the upper classes.
You accuse me of offering up “regurgitated criticisms,” yet it is you who simply repeats the standard pro-capitalist refrains. So much so, that you don’t even address the points I make, as if you spend so little time reading my posts, that you simply dash off a memorized line without checking to make sure it is relevant, the very definition of dogmatism. You say that capitalism is the most efficient way to increase standards of living, but you ignore the many instances throughout history of partly or entirely government managed economies trouncing market economies. The fact is, you are simply in error here. Sorry.
You miss the mark again. Simple income supplementation strategies like food stamps, social security, etc. are an effective way to reduce the gap. Offering subsidized social services to lower-income groups is another. Who needs to “find” a way to do it? Many nations are doing it now and have done it for over 50 years.
It is very simple, but you display a not-very nuanced approach, here. Again, you’re simply missing the point. You’re so anxious to get back to the standardized rebuttals that you fail to understand the argument. I was talking about disproportions in the compensation rates for these things, which are not a danger. You are still conflating the disproportion itself with the actions of people who are dissatisfied with the inequity. You do so in order to get back to the comfort of your “regurgitated criticisms,” but in doing so, you begin to argue against a position no one is taking.
[quote]No one wants to return to this, nor would we with less regulation. To argue the fact would be silly.
Why were people willing to work for $25 a week at this specific period in time? Could it be that this was a better option than they had previously? If it wasn’t an improvement in quality of life, they would have stayed on the farm or continued to do what ever else they were doing.[/quote]
No, it was frequently because the company, or the government on behalf of the company, took their farm away from them. It is material compulsion that necessitated their submission to these conditions, another fact that capitalist apologists would rather you forget.
Again, you ignore the many factors at play in those cases which your idealist assumptions ignore. The fact is, most people had no choice. They had to work for somebody, and in general in those times, there were so many unemployed that if they had not done it, they would have been replaced. A man has to eat.
You again misunderstand the nature of the state. It is merely the collective tool of the capitalist class. Why would they undertake to harm themselves?
And do what? Starve? The average worker has little savings to survive on for any length of time, and so this gives the employer a large advantage from the start. This is basic economics. Yet, in your Libertarian world, you propose to give the employer another advantage yet, by eliminating the social programs that provide some buffer against the forces of the market. Liberty for employers seems to be your only concern.
But government is oftentimes more efficient than the market. I think it was the Baltimore Sun that had an article where a large study showed this. Focusing on the inefficiencies of planning (which are exaggerated when they are not fabricated), while ignoring the inefficiencies of markets illustrates the ideological nature of Libertarianism, as opposed to any desire for efficiency.
It’s more effective if you actually read it. Better yet, you don’t even have to read it. Just look at the pictures. You’ll see some of those starving children.
[quote]Ryan P. McCarter wrote:
[quote]Brother Chris wrote:
I am sure Chile, Cuba, &c. really have a higher living standard than America, and they have one good welfare state.[/quote]
I thought Chile was an “economic miracle,” an example of laisse-faire success?
As far Cuba goes, they do have quite a good standard of living. They have virtually no poverty, the entire population lives in sanitary conditions, they have free universal health care. One out of every 4 doctors in the Caribbean is Cuban. They have not been a dynamo of growth, but this is to be expected. Imagine if we were Cuba, a tiny island, and Al Qaeda was the United States. That’s basically the situation. Considering our stranglehold on their economy, their successes are quite impressive. Think about it. Why the travel ban? As William Blum pointed out, if Cuba were half as bad as we make it out to be, the government would pay you to go there and see it.[/quote]
Have you ever been to Cuba? If they have such “good standard of living” why are they basically trying to get to Florida in little more that a canoe, and taking a risk of dying in the crossing? You really need to visit a 3rd world country before you state they are better than us.
[quote]dmaddox wrote:
[quote]Ryan P. McCarter wrote:
[quote]Brother Chris wrote:
I am sure Chile, Cuba, &c. really have a higher living standard than America, and they have one good welfare state.[/quote]
I thought Chile was an “economic miracle,” an example of laisse-faire success?
As far Cuba goes, they do have quite a good standard of living. They have virtually no poverty, the entire population lives in sanitary conditions, they have free universal health care. One out of every 4 doctors in the Caribbean is Cuban. They have not been a dynamo of growth, but this is to be expected. Imagine if we were Cuba, a tiny island, and Al Qaeda was the United States. That’s basically the situation. Considering our stranglehold on their economy, their successes are quite impressive. Think about it. Why the travel ban? As William Blum pointed out, if Cuba were half as bad as we make it out to be, the government would pay you to go there and see it.[/quote]
Have you ever been to Cuba? If they have such “good standard of living” why are they basically trying to get to Florida in little more that a canoe, and taking a risk of dying in the crossing? You really need to visit a 3rd world country before you state they are better than us.[/quote]
I have been to both, both are wonderful countries and have a culture that is warm and welcoming. Chile is in a military dictatorship and Cuba as well, both have livable standards of living, but are no where luxurious as even most rough neighborhoods of America, unless you go to the leaders of those countries. Even one of the most famous writers in Chile who owns four houses (three there and one in France) lives in what seems would be considered a slum by outside appearances and besides the size of the place (about 1500 sq ft) is not much better on the inside compared to others.
This is where I come to the conclusion that the Mick doesn’t know what he is talking about when it comes to communism, because he cannot recognize it when he is staring it in its face.
Maybe you missed my previous post where I explained Cuba’s predicament. Perhaps you’re not aware, but our trade embargo is much more than simply not buying Cuban sugar. It prohibits US businesses from doing business with Cuba in general, and also prevents them from doing business with many foreign firms who do business with Cuba (which means that many European and other firms are pressured into not dealing with Cuba, either), and significantly constrains their access credit, making them pay cash for many things.
So considering the extent to which we hamper their economy, yes, they actually do quite well.