Occasi-Cortez Channeling the Rent's too damn high guy

[Chef Jim]

51 minutes ago, ExiledInIllinois said:

Yes, they should be paying more... A lot more.

 

And here’s my favorite response to these types of statements. Why? 

 

I heard a great line on the radio this morning. “When did wanting to make and keep as much money as possible become greedy and demanding a big piece of that wealth become not greedy?” 

Edited January 17, 2019 by Chef Jim

[Kevbeau]

5 minutes ago, ExiledInIllinois said:

Yeah.  Gaming the system. 

How is that gaming the system. Are you advocating forced labor and limitations on where you can live? Think about that before you answer.

[ExiledInIllinois]

5 minutes ago, Chef Jim said:

 

And here’s my favorite response to these types of statements. Why? 

Because there is more disposable income and wealth.  Takes a bigger % income at the lower economic rungs to sustain life.  Basic life sustaining food and shelter is pretty much equal.  The rest is luxury.  Easier to fund with excess, luxuries.

2 minutes ago, Kevbeau said:

How is that gaming the system. Are you advocating forced labor and limitations on where you can live? Think about that before you answer.

Do they ever come back to the states with his/her income... Use services, infrastructure?

Edited January 17, 2019 by ExiledInIllinois

[Chef Jim]

Just now, ExiledInIllinois said:

Because there is more disposable income and wealth.  Takes a bigger % income at the economic rungs to sustain life.  Basic life sustaing food and shelter is pretty much equal.  The rest is luxury.  Easier to fund with excess, luxuries.

 

So now luxuries are bad?  Someone who has worked their ass off to obtain these luxuries shouldn’t be allowed to have them. 

 

Why?

 

Oh and BTW basic necessities are far from equal. 

[ExiledInIllinois]

1 minute ago, Chef Jim said:

 

So now luxuries are bad?  Someone who has worked their ass off to obtain these luxuries shouldn’t be allowed to have them. 

 

Why?

 

Oh and BTW basic necessities are far from equal. 

Uh... Because they are reaping the rewards of a safe, modern society.

 

Don't get me wrong.  I worked swing shift for 30 years, damaged my body, etc... It's now a luxury I have a Federal job.

 

I don't really disagree with you.  But, it's called being grateful too.  Their is luxury and then there is opulant.  All varying levels.  We all give back in ways.

 

Yet... In the end, it really boils down to it's easier.  Less people who are pissed off an are apt to get violent because they can't provide basic need.

 

It's a more stable society.

[Kevbeau]

11 minutes ago, ExiledInIllinois said:

Because there is more disposable income and wealth.  Takes a bigger % income at the lower economic rungs to sustain life.  Basic life sustaining food and shelter is pretty much equal.  The rest is luxury.  Easier to fund with excess, luxuries.

Do they ever come back to the states with his/her income... Use services, infrastructure?

To visit family yes. So he uses transportation infrastructure, but so do others of millions of visitors. 

 

And isnt a big part of the “wall” arguement to prevent people from “gaming the system” and taking advantage of our services and infrastructure?

Edited January 17, 2019 by Kevbeau

[ExiledInIllinois]

7 minutes ago, Kevbeau said:

To visit family yes. So he uses transportation infrastructure, but so do others of millions of visitors. 

 

And isnt a big part of the “wall” arguement tonprevent people from “gaming the system” and taking advantage of our services and infrastructure?

No.  It's because the GOP is losing the demographics game.  The minority in power is losing it's grip.  Bring migrants in to be productive working citizens... That's the "Browning of America" that threatens the Republican voting base, power.  You think the GOP wants America to be Brown and vote Dem?

 

Build a wall to keep from changing, losing power, influence.  This is the very definition of being conservative.  Conservative = afraid to change, take risks...

 

Lead, follow, or get out of the way.  Adapt and overcome.  That's why walls are built... Fear of change. Fear of unknown.  Being paranoid.  Everything else is a smokescreen.

Edited January 17, 2019 by ExiledInIllinois

[TPS]

40 minutes ago, GG said:

 

This has also been debated as naseam.  When you reach a situation where half the population doesn't pay any income tax, that's when the populist danger zone hits.  You cannot have a sound fiscal policy when half the nation doesn't participate and expects government services to increase.  The rich have the most disposable incomes, but they also have the most discretionary and mobile incomes.   It's insane to base a tax policy on incomes that may disappear or fluctuate wildly.

 

You may be right, indirectly. It is inequality that causes the rise in populism (just as it did over 100 years ago, just as it's doing in France), and rising inequality means more people at the bottom who don't pay taxes while those at the top pay a greater share of income taxes. However, the bottom tends to pay "their fair share" in the form of other taxes--when ALL forms of taxation are considered, the tax rate differential is not too significant.

 

As I've said in the past, Taxes are mainly a redistributive mechanism, which is why inequality remained relatively stable from post WWII to 1980--high marginal tax rates help reduce the "natural" increase in the concentration of wealth that occurs via compounding. And, Concentrated wealth tends to destroy democracy as wealth means power which buys the legislation it wants--just as the "Robber Barons" influenced government so have many of today's billionaires.

 

As Kevin Phillips detailed in his book Wealth and Democracy, something like 50% of accumulated wealth in the US could be attributed to spending on wars (this was pre-1990s and the technology wealth boom).  Yes, government does not produce wealth, but its spending increases private sector wealth. Taxes redistribute income from payers to payees, and spending beyond taxes creates new "wealth" for the payees--the federal government's annual deficit creates an annual surplus for the private sector.  The $21 trillion debt is the private sector's asset (including foreigners).  The way government "financing" works is that it borrowers what it has already spent. The spending in excess of taxes creates the funds available to purchase the debt it's required to sell.

 

This is what the emergence of MMT is bringing to light, and AOC understands this.  It's also the reason Trump can raise spending while simultaneously reducing taxes, which was the underlying cause of faster growth in 2018.

 

So, if a government creates wealth via deficit spending, then is it "confiscating" that wealth when it taxes it? 

 

Have at it....

 

[ExiledInIllinois]

 

 

Oh... And your Dev is still an American Citizen.  They can run home when the poo hits the fan.  Who's trying to police the world, keep things stable... Coasta Rica gets those benny's or they wouldn't be there... That's a lot of military $$$$ as an ex-pat.

[GG]

4 minutes ago, TPS said:

You may be right, indirectly. It is inequality that causes the rise in populism (just as it did over 100 years ago, just as it's doing in France), and rising inequality means more people at the bottom who don't pay taxes while those at the top pay a greater share of income taxes. However, the bottom tends to pay "their fair share" in the form of other taxes--when ALL forms of taxation are considered, the tax rate differential is not too significant.

 

As I've said in the past, Taxes are mainly a redistributive mechanism, which is why inequality remained relatively stable from post WWII to 1980--high marginal tax rates help reduce the "natural" increase in the concentration of wealth that occurs via compounding. And, Concentrated wealth tends to destroy democracy as wealth means power which buys the legislation it wants--just as the "Robber Barons" influenced government so have many of today's billionaires.

 

As Kevin Phillips detailed in his book Wealth and Democracy, something like 50% of accumulated wealth in the US could be attributed to spending on wars (this was pre-1990s and the technology wealth boom).  Yes, government does not produce wealth, but its spending increases private sector wealth. Taxes redistribute income from payers to payees, and spending beyond taxes creates new "wealth" for the payees--the federal government's annual deficit creates an annual surplus for the private sector.  The $21 trillion debt is the private sector's asset (including foreigners).  The way government "financing" works is that it borrowers what it has already spent. The spending in excess of taxes creates the funds available to purchase the debt it's required to sell.

 

This is what the emergence of MMT is bringing to light, and AOC understands this.  It's also the reason Trump can raise spending while simultaneously reducing taxes, which was the underlying cause of faster growth in 2018.

 

So, if a government creates wealth via deficit spending, then is it "confiscating" that wealth when it taxes it? 

 

Have at it....

 

 

For heavens sake, will you please stop the government "creates wealth" ruse.  The government does not create wealth.  It allows private individuals to keep more of their wealth, which allows for capitalism to do its magic through innovation and creative destruction to create new wealth.

 

PS, I doubt AOC understands complex economic questions beyond her stock soundbites that the rich aren't paying their fair share.

Edited January 17, 2019 by GG

[Kevbeau]

19 minutes ago, ExiledInIllinois said:

 

 

Oh... And your Dev is still an American Citizen.  They can run home when the poo hits the fan.  Who's trying to police the world, keep things stable... Coasta Rica gets those benny's or they wouldn't be there... That's a lot of military $$$$ as an ex-pat.

You do know ex-pats are subject to federal income taxes, right? This goes back to my point on the risk dynamic. If it’s a reasonable tax, people are more likely to pay it. If it becomes unreasonable, then one will start to weigh the cost/benefit of creative accounting or outright not paying it.

 

edit: I don’t personally know what he does with his taxes but the feds have never contacted us so I will assume he’s on the up and up with them

Edited January 17, 2019 by Kevbeau

[TakeYouToTasker]

10 hours ago, SoCoBills said:

Put it this way - our parents used to be able to support their families comfortably by having only 1 parent work 1 full time job. The mothers/wives were typically expected and able to upkeep the home and care for the children. Nowadays though we can't afford to do that. Now both parents must work full time jobs to live paycheck to paycheck while our kids are raised at daycares. It all boils down to a rigged economy due to money in politics resulting in legislation that favors those who lobby - the rich. Call it Socialism because that's the GOP scare tactic but it's a mixed economy. 

 

GG and others are doing a fine job of dismantling the rest of your argument, so I'll just take issue with this part, which as of yet has gone unattended.

 

The reason we have become reliant on two income families is due to feminism and women's rights.  Full stop.

 

Understand, I'm not arguing against women's equality, but everything is directly tied to economics.

 

When women entered the work force, en mass, it doubled the supply of labor, but had little effect on the demand for goods and services, so wages declined as workers lost their bargaining power provided by labor scarcity.  Over time, this has led to a situation where two incomes are required, where one used to suffice.

Edited January 17, 2019 by TakeYouToTasker

[Foxx]

Visions of a 70% Tax Rate

 

... When the Tax Foundation authors considered the effect on behavior and incentives—why bother with that extra investment if most of the money will go to government?—they found that a 70% top rate on all income would lose the government $63.5 billion over 10 years.

 

Ms. Ocasio-Cortez won’t admit it, but she and her socialist friends will eventually have to go where the real money is: The middle class. That means higher tax rates on even modest wage earners; taxes on retirement savings like 401(k)s or college savings accounts.

 

Remember this the next time a Democrat or columnist who claims to be conservative says he’ll finance a program by hitting the 1% of earners who already pay more than a third of America’s income taxes. Sooner or later they’re coming after you.

Edited January 17, 2019 by Foxx

[Chef Jim]

48 minutes ago, ExiledInIllinois said:

Uh... Because they are reaping the rewards of a safe, modern society.

 

Don't get me wrong.  I worked swing shift for 30 years, damaged my body, etc... It's now a luxury I have a Federal job.

 

I don't really disagree with you.  But, it's called being grateful too.  Their is luxury and then there is opulant.  All varying levels.  We all give back in ways.

 

Yet... In the end, it really boils down to it's easier.  Less people who are pissed off an are apt to get violent because they can't provide basic need.

 

It's a more stable society.

 

I look at it this way. The safe modern society has benefited from the hard work, current tax burden and contribution to the economy by the wealthy. 

 

And whose responsibility to provide for their basic needs?   It's not my job to placate them because they "ain't got theirs."  It's my job to squash their violent jealousy or better yet to motivate and educate them on how to get theirs on their own.  

[ExiledInIllinois]

50 minutes ago, TakeYouToTasker said:

 

GG and others are doing a fine job of dismantling the rest of your argument, so I'll just take issue with this part, which as of yet has gone unattended.

 

The reason we have become reliant on two income families is due to feminism and women's rights.  Full stop.

 

Understand, I'm not arguing against women's equality, but everything is directly tied to economics.

 

When women entered the work force, en mass, it doubled the supply of labor, but had little effect on the demand for goods and services, so wages declined as workers lost their bargaining power provided by labor scarcity.  Over time, this has led to a situation where two incomes are required, where one used to suffice.

Oh boy... Here we go again.

 

Father knows best syndrome.

[Kevbeau]

1 hour ago, ExiledInIllinois said:

No.  It's because the GOP is losing the demographics game.  The minority in power is losing it's grip.  Bring migrants in to be productive working citizens... That's the "Browning of America" that threatens the Republican voting base, power.  You think the GOP wants America to be Brown and vote Dem?

 

Build a wall to keep from changing, losing power, influence.  This is the very definition of being conservative.  Conservative = afraid to change, take risks...

 

Lead, follow, or get out of the way.  Adapt and overcome.  That's why walls are built... Fear of change. Fear of unknown.  Being paranoid.  Everything else is a smokescreen.

Maybe...but the demo shift is going to happen with or without a wall. Even if they were afraid of change and the wall was entirely about the voting balance , the GOP needs to convince “Brown America” that they have the better vision. Therefore my belief that the wall isn’t about controlling the voting populous.

 

 

Edited January 17, 2019 by Kevbeau

[Tiberius]

59 minutes ago, TakeYouToTasker said:

 

 

When women entered the work force, en mass, it doubled the supply of labor, but had little effect on the demand for goods and services, so wages declined as workers lost their bargaining power provided by labor scarcity.  Over time, this has led to a situation where two incomes are required, where one used to suffice.

This is wrong on so many levels that it is my pleasure to crap all over this psydo-economic interpretation. First off, to boil this question down to a single cause and blame women for it is both simplistic and purposely selective. The work force, economy and society have all radically changed since and while women entered the work force. Whole new areas of employment have opened up while others have closed down. To simplistically compare the economy of 1960 with today's and say women working is THE factor why there is a "need" for two income families is sophomoric. The population has increased by 1/3 since 1970 alone (more workers) , people are living in bigger houses, have more cars per family, travel more and have more debt. Spending more requires more income, to state the obvious.  Labor unions are fading out, and along with them the ability of workers to demand higher wages, even though this is off set in many ways by lower costs of goods and services. The need to get a college education, the need for day care and the less reliance on public transportation all factor in. 

[TPS]

1 hour ago, GG said:

 

For heavens sake, will you please stop the government "creates wealth" ruse.  The government does not create wealth.  It allows private individuals to keep more of their wealth, which allows for capitalism to do its magic through innovation and creative destruction to create new wealth.

 

PS, I doubt AOC understands complex economic questions beyond her stock soundbites that the rich aren't paying their fair share.

It's not a ruse, it's a fact.  By spending in excess of taxes the government increases spending/demand in the private sector which builds private sector wealth. The government can do this because it is the issuer of its own currency.  You can bluster all you want, but that is how the actual mechanics of fiscal policy works. Apparently AOC knows more than you do on this...?

[TakeYouToTasker]

5 minutes ago, TPS said:

It's not a ruse, it's a fact.  By spending in excess of taxes the government increases spending/demand in the private sector which builds private sector wealth. The government can do this because it is the issuer of its own currency.  You can bluster all you want, but that is how the actual mechanics of fiscal policy works. Apparently AOC knows more than you do on this...?

 

No, it doesn't.

 

That's like arguing that babies come some the Simmons mattress factory because they made the bed you ***** in. 

[sherpa]

2 hours ago, ExiledInIllinois said:

No.  It's because the GOP is losing the demographics game.  The minority in power is losing it's grip.  Bring migrants in to be productive working citizens... That's the "Browning of America" that threatens the Republican voting base, power.  You think the GOP wants America to be Brown and vote Dem?

 

Build a wall to keep from changing, losing power, influence.  This is the very definition of being conservative.  Conservative = afraid to change, take risks...

 

Lead, follow, or get out of the way.  Adapt and overcome.  That's why walls are built... Fear of change. Fear of unknown.  Being paranoid.  Everything else is a smokescreen.

 

This is a post that demonstrates that its author has absolutely no idea of this issue.

Absolutely no idea. 

[GG]

12 minutes ago, TPS said:

It's not a ruse, it's a fact.  By spending in excess of taxes the government increases spending/demand in the private sector which builds private sector wealth. The government can do this because it is the issuer of its own currency.  You can bluster all you want, but that is how the actual mechanics of fiscal policy works. Apparently AOC knows more than you do on this...?

 

That doesn't create wealth.  It only redistributes it.

 

And to clarify it - it distributes it in the form of passive or active income, and it's the individuals who decide what to do with the additional income, whether to spend or save.  If your and AOC's theories were correct, the socialist economies would have won the argument many times over by now.

Edited January 17, 2019 by GG

[ExiledInIllinois]

38 minutes ago, Kevbeau said:

Maybe...but the demo shift is going to happen with or without a wall. Even if they were afraid of change and the wall was entirely about the voting balance , the GOP needs to convince “Brown America” that they have the better vision. Therefore my belief that the wall isn’t about controlling the voting populous.

 

 

 

You gotta be kidding.

 

"Trump's Vision" is really doing that! /sarcasm Yeah, right... His GOP ball washers, appeasers are silent, watching him scare people to the Democrats.

 

Totally unsustainable. Great Vision.  Only thing brown is coming out his mouth!

 

 

 

You're doing one hell of a job Orangie trying to portray a vision!

[TPS]

3 minutes ago, TakeYouToTasker said:

 

No, it doesn't.

 

That's like arguing that babies come some the Simmons mattress factory because they made the bed you ***** in. 

I will gladly entertain attempts to prove that proposition wrong. 

Just now, GG said:

 

That doesn't create wealth.  It only redistributes it

No, only the portion that's taxed is a redistribution.  As I said, deficit spending injects new money/spending into the economy.  The government is required by law to sell bonds equivalent to the difference, but the "money" available to buy those bonds was created when the government FIRST spent out of its account held by the Fed.  Government spends and the FED credits the DD account of the payee as well as the reserve position of the bank. The bank now has additional reserves to buy government bonds.

[GG]

5 minutes ago, TPS said:

I will gladly entertain attempts to prove that proposition wrong. 

No, only the portion that's taxed is a redistribution.  As I said, deficit spending injects new money/spending into the economy.  The government is required by law to sell bonds equivalent to the difference, but the "money" available to buy those bonds was created when the government FIRST spent out of its account held by the Fed.  Government spends and the FED credits the DD account of the payee as well as the reserve position of the bank. The bank now has additional reserves to buy government bonds.

 

Here you go again.  There are two ways to increase the deficit and they're in no way equivalent.  One way is for the government to simply spend more than it takes in, while still soaking the private sector.  The other way is to maintain the same spending levels, but let the private sector keep more of its earnings.   Which one do you think is more conducive to creating real wealth?    Which one do you and AOC don't understand?

[TakeYouToTasker]

16 minutes ago, TPS said:

I will gladly entertain attempts to prove that proposition wrong. 

 

I feel like I've had this discussion with you before.

 

The government issues currency, but currency, even fiat currency which is used as the global marker for trade, is not the same thing as wealth.  It is a marker for wealth used to grease the skids of exchange by making it easier and more convenient.  That is all.

 

Even the dollar is backed by something tangible.  "The full faith and credit of the United States", which is nothing more than a fancy way of saying "the promise of future units of labor produced by Americans".

 

Debt incurred by the government represents labor which must be undertaken at some point in the future.  A cheeseburger today, with the promise to pay tomorrow.

 

So, no, the government does not "create wealth".  But rather, as GG says, it redistributes it both in a linear way, and across time from the future.

 

Wealth is created exclusively by combining capital with labor.

[Foxx]

the US dollar is a debt marker. all fiat is for that matter.

Edited January 17, 2019 by Foxx

[TPS]

4 minutes ago, GG said:

 

Here you go again.  There are two ways to increase the deficit and they're in no way equivalent.  One way is for the government to simply spend more than it takes in, while still soaking the private sector.  The other way is to maintain the same spending levels, but let the private sector keep more of its earnings.   Which one do you think is more conducive to creating real wealth?    Which one do you and AOC don't understand?

You should be more clear.  Starting from G=T, there are three ways: 1) Increase G; T constant; 2) G constant, decrease T; 3) change both, as Trump did. In cases 1 and 2, if G and T are changed by an equal amount, the impact on the deficit in year one is about he same.  In both cases, the deficits increase demand in the economy stimulating growth.  You believe the supply side argument the lower taxes will create an incentive for businesses to expand independent of the expansionary impact of deficits. The evidence I as I recall shows that effect is insignificant.

[GG]

Just now, TPS said:

You should be more clear.  Starting from G=T, there are three ways: 1) Increase G; T constant; 2) G constant, decrease T; 3) change both, as Trump did. In cases 1 and 2, if G and T are changed by an equal amount, the impact on the deficit in year one is about he same.  In both cases, the deficits increase demand in the economy stimulating growth.  You believe the supply side argument the lower taxes will create an incentive for businesses to expand independent of the expansionary impact of deficits. The evidence I as I recall shows that effect is insignificant.

 

Economics models are always backwards looking and always try to tie in how government creates private sector demand, when there's zero causal relationship.  Ever.

[TPS]

3 minutes ago, TakeYouToTasker said:

 

I feel like I've had this discussion with you before.

 

The government issues currency, but currency, even fiat currency which is used as the global marker for trade, is not the same thing as wealth.  It is a marker for wealth used to grease the skids of exchange by making it easier and more convenient.  That is all.

 

Even the dollar is backed by something tangible.  "The full faith and credit of the United States", which is nothing more than a fancy way of saying "the promise of future units of labor produced by Americans".

 

Debt incurred by the government represents labor which must be undertaken at some point in the future.  A cheeseburger today, with the promise to pay tomorrow.

 

So, no, the government does not "create wealth".  But rather, as GG says, it redistributes it both in a linear way, and across time from the future.

 

Wealth is created exclusively by combining capital with labor.

We agree on the first and last points. The dollar is simply the unit of account which is "good for all debts public and private."  Physical dollars or Demand Deposits expressed in $s are wealth in that they can purchase physical things, but all financial assets have that same quality--they are pieces of paper that can be converted to a means of payment which can then be used to buy things.   If financial assets are wealth, then so are physical $s and deposits.  But this isn't what we really disagree on.  The question is how does new money get injected into the economy?   There are two sources:

1. If the private sector wants to spend more than it receives in income, then it borrows from the private banking system.  Expanding businesses require lines of credit to fund production; or a family can buy a new house by obtaining a mortgage.  In each case, Deposits go up on the banks liability side and loans go up on the asset side.  In the aggregate, the money supply goes up when net loan creation is positive.  Physical $s depend on the public's desire to hold cash or DD.  The more we desire to hold cash, the more in circulation.

2. What I've described. Here's a micro example. When government spends, the Fed credits the DD of (say) Halliburton and simultaneously credits the reserve account of (say) B

of A. If the spending occurred without increasing taxes, then government has to sell a bond as the law requires. BofA uses the additional reserves to purchase the bond, so it now has a t-bond instead of reserves (its reserve account at the Fed reduced by same).  The end result: Halliburton's revenue is higher by the value of its DD, and BofA has a new interest earning treasury bond. This is how it works.  The government's deficit has created an asset for BofA and higher revenue for Halli.

 

As for the debt, the government never has to pay it off.  It has to make the interest payments and then it rolls over maturing debt as it always has.  Another example for you. Suppose we balance the budget for the next 25 years and keep rolling over the debt.  If GDP grows at its historical norm of 3%, the in will double over this period.  The Debt-GDP ratio will be halved, from 100% to 50%.  Now, go another 25 years....

 

Absolutely wealth is created by capital labor, but money puts both of them to work. Unfortunately, too much has been directed at creating wealth in the form of factories that produce means of destruction not production....

 

 

[unbillievable]

10 minutes ago, TPS said:

You should be more clear.  Starting from G=T, there are three ways: 1) Increase G; T constant; 2) G constant, decrease T; 3) change both, as Trump did. In cases 1 and 2, if G and T are changed by an equal amount, the impact on the deficit in year one is about he same.  In both cases, the deficits increase demand in the economy stimulating growth.  You believe the supply side argument the lower taxes will create an incentive for businesses to expand independent of the expansionary impact of deficits. The evidence I as I recall shows that effect is insignificant.

 

You're confusing demand with wealth creation.

 

Deficit spending manipulates the equilibrium point by producing large areas of waste. While it may seem to increase production in the short term, the market has to account for the waste by devaluing the product, currency or both to bring it back to where it was before. However, because of the inherent inefficiency of government, wealth is destroyed in the process.

 

While government spending can be a useful to tool to regulate the economy, the temporary economic high it brings ALWAYS creates an equally low swing to maintain balance. What you're arguing isn't actually creating wealth, but advocating for more volatile swings in the economic pendulum, with a naive belief that someone "smart" can figure out how to keep it under control.

 

So while you're trying to convince us that deficit spending will bring with it improved infrastructure, social programs, and jobs for everyone (Venezuela) We're telling you that we're afraid of the eventual swing to starvation, homelessness, and riots (also Venezuela).

 

Your understanding of wealth seems to be inflation, where bread that used to cost $2 is now worth $4.

[TPS]

31 minutes ago, GG said:

 

Economics models are always backwards looking and always try to tie in how government creates private sector demand, when there's zero causal relationship.  Ever.

From 1940 to 1945 real GDP grew by 75% or 12% annually.  Did the private sector cause  that growth? if so, how?

[TPS]

5 minutes ago, unbillievable said:

 

You're confusing demand with wealth creation.

 

Deficit spending manipulates the equilibrium point by producing large areas of waste. While it may seem to increase production in the short term, the market has to account for the waste by devaluing the product, currency or both to bring it back to where it was before. However, because of the inherent inefficiency of government, wealth is destroyed in the process.

 

While government spending can be a useful to tool to regulate the economy, the temporary economic high it brings ALWAYS creates an equally low swing to maintain balance. What you're arguing isn't actually creating wealth, but advocating for more volatile swings in the economic pendulum, with a naive belief that someone "smart" can figure out how to keep it under control.

 

So while you're trying to convince us that deficit spending will bring with it improved infrastructure, social programs, and jobs for everyone (Venezuela) We're telling you that we're afraid of the eventual swing to starvation, homelessness, and riots (also Venezuela).

 

Your understanding of wealth seems to be inflation, where bread that used to cost $2 is now worth $4.

Obama increased the deficit by $7.3 trillion from 2009 to 2016. Do you know what the average rate of inflation was over this period?

[Foxx]

NIRP, coming soon to an economy near you.

[Chef Jim]

21 minutes ago, TPS said:

From 1940 to 1945 real GDP grew by 75% or 12% annually.  Did the private sector cause  that growth? if so, how?

 

So you're going to pull THAT 5 years of our history to argue that the public sector drives economic growth?? 

[TPS]

8 minutes ago, Chef Jim said:

 

So you're going to pull THAT 5 years of our history to argue that the public sector drives economic growth?? 

The other way around.  For those who say government doesn't create growth/wealth, then what was the cause of the rapid expansion of output during this 5-year period?  

Where did the funding come from?

 

I would never say the public sector drives economic growth; it can stimulate growth just as Trump has done with increased spending and cutting taxes.  It does so by injecting additional demand into the economy, NOT by redistributing income. 

 

[Foxx]

37 minutes ago, Chef Jim said:

 

So you're going to pull THAT 5 years of our history to argue that the public sector drives economic growth?? 

it was war driven, nothing more. i guess it could be said that the .gov drove it....

[Chef Jim]

Just now, Foxx said:

it was war driven, nothing more. i guess it could be said that the .gov drove it....

 

Well it was also we had a long way up to go after the beat down of the depression.  Add those two together, the likes of which we will hopefully never see again, of course your see incredible growth.  

[GG]

21 minutes ago, TPS said:

The other way around.  For those who say government doesn't create growth/wealth, then what was the cause of the rapid expansion of output during this 5-year period?  

Where did the funding come from?

 

I would never say the public sector drives economic growth; it can stimulate growth just as Trump has done with increased spending and cutting taxes.  It does so by injecting additional demand into the economy, NOT by redistributing income. 

 

If your theory is correct why didn't you pull the growth figures from the decade prior to the 5 years you selected?

 

Please remind me if that was another period of government stimulating the demand.  

[TPS]

1 minute ago, Chef Jim said:

 

Well it was also we had a long way up to go after the beat down of the depression.  Add those two together, the likes of which we will hopefully never see again, of course your see incredible growth.  

The issue is that Tasker and GG think that government can only redistribute income, which has no impact on growth/wealth.  In the case of a balanced budget that is true. With deficit spending, that's not the case.  Government stimulates demand via deficits which causes the private sector to produce more output--wealth. 

 

23 minutes ago, GG said:

If your theory is correct why didn't you pull the growth figures from the decade prior to the 5 years you selected?

 

Please remind me if that was another period of government stimulating the demand.  

From 1935 to 1940, RGDP grew by about 6% annually vs 12 % during the war.  The average deficit in the first period was just under 3%/year; the average deficit in the second period was 17%/year.

 

The impact of deficits of course depends on what's happening in the other sectors.  Usually they go up when the private sector (C+I) is contracting, so higher deficits are associated with lower growth (as in Obama's first term).  However, if the economy is growing and you juice it with deficits, it will juice the economy, just as we saw last year.  

 

It's really straight-forward.  Unfortunately it's usually ideology that prevents using deficits to stimulate the economy more than if left alone, though republicans certainly realize "deficits don't matter."  For conservatives, it seems deficit spending is fine as long as it for a wall or a war.....

 

The only thing that limits us from producing more wealth is labor and capital as Tasker stated.  Government deficit spending is a mechanism that puts more labor and capital to use.  It's up to us to influence our politicians on how we want those resources used.

[GG]

1 minute ago, TPS said:

The issue is that Tasker and GG think that government can only redistribute income, which has no impact on growth/wealth.  In the case of a balanced budget that is true. With deficit spending, that's not the case.  Government stimulates demand via deficits which causes the private sector to produce more output--wealth. 

 

From 1935 to 1940, RGDP grew by about 6% annually vs 12 % during the war.  The average deficit in the first period was just under 3%/year; the average deficit in the second period was 17%/year.

 

The impact of deficits of course depends on what's happening in the other sectors.  Usually they go up when the private sector (C+I) is contracting, so higher deficits are associated with lower growth (as in Obama's first term).  However, if the economy is growing and you juice it with deficits, it will juice the economy, just as we saw last year.  

 

It's really straight-forward.  Unfortunately it's usually ideology that prevents using deficits to stimulate the economy more than if left alone, though republicans certainly realize "deficits don't matter."  For conservatives, it seems deficit spending is fine as long as it for a wall or a war.....

 

The only thing that limits us from producing more wealth is labor and capital as Tasker stated.  Government deficit spending is a mechanism that puts more labor and capital to use.  It's up to us to influence our politicians on how we want those resources used.

 

You just can't get your head out of the class.  You are talking about the results of what happens in the private sector when the government allows people to keep more of their earnings and assets.  You are approaching it from the leftist perspective that the property belongs to the government and it's up to the Treasury's whims when to release it and how it gets deployed, therefore, the more that the government releases, the faster the growth.   If that were the case, Zimbabwe would be the envy of the free world, because with the government giving money away would not only drive supersized growth but would invite outside investment to partake in that government stimulous.

 

Our position is that the property belongs to the individual, and government's decision to allow the individuals to keep more of their property and have the people decide what to do with that property is really what makes the economy grow faster.   

 

This shouldn't even be up for a debate.

 

Government cannot create wealth.  Period.  It can only take it away or redistribute it