The rich just get richer!

[daviddsims]

http://www.huffingtonpost.com/2009/01/27/bank-of-america-hosted-an_n_161248.html Boy if it was clear before then America needs to wake up and realize that the rich people could care less about the middle class. I really believe that America will fall apart because of greed and our leaders will do nothing.

[skinsfan_1215]

Well at least they're finally raising the minimum wage again. I think it'll be up to $7.25 this summer. Thank you Nancy Pelosi.

[Koolblue13]

http://www.huffingtonpost.com/2009/01/27/bank-of-america-hosted-an_n_161248.html Boy if it was clear before then America needs to wake up and realize that the rich people could care less about the middle class. I really believe that America will fall apart because of greed and our leaders will do nothing.

People care about themselves, regardless of their class wage.

Do you think the rich get together and laugh at the middle class or do you think they talk about their own investments and securities?

[daviddsims]

But when you have all of the elite wealthy that cant get enough calling the shots and running the goverment then you have a huge problem. There has to be oversight to make sure that everyone has a fair shot at the pie. I seriously doubt Teddy Roosevelt would like this too much.

[SkinsHokieFan]

Woo-hoo we are linking the Huffington Post on ES now!

I simply don't understand why some, notice I said some, of my friends on the left seem to think the economy is a zero sum game

Here is a fact: The rich make the pie that much bigger.

[Smoot Point Really]

Those evil rich people and their desire to earn more money!

[skinsfan_1215]

Woo-hoo we are linking the Huffington Post on ES now!

I simply don't understand why some, notice I said some, of my friends on the left seem to think the economy is a zero sum game

Here is a fact: The rich make the pie that much bigger.

Hey no doubt about it. It is extremely important to have a business environment that allows for growth and the creation of new wealth. My only comment about that is it is ALSO important to not squash the little people in the process. Raising the minimum wage was just one small step in the right direction, but the first of those steps we've seen in quite some time.:2cents:

[PiLfan]

This bill may be one of the worst things I have ever seen in my life," Bernie Marcus said, explaining that he could have been on "a 350-foot boat out in the Mediterranean," but felt it was more important to engage on this fight.

http://colossus.mu.nu/smallest-violin.jpg

[jnhay]

I'd think that raising the minimum wage just raises unemployment. I think it's retarded to say that the government should just stay out of business' way though. If that were the case, America would just be about the super-rich and super-poor.

[skinsfan_1215]

I'd think that raising the minimum wage just raises unemployment. I think it's retarded to say that the government should just stay out of business' way though. If that were the case, America would just be about the super-rich and super-poor.

You are correct that raising the minimum wage would raise unemployment. That is one of the side effects, but I think that businesses will just get used to not being able to exploit workers with piss-poor wages.

[TD_washingtonredskins]

http://colossus.mu.nu/smallest-violin.jpg

He's not complaining...he's demonstrating that he doesn't NEED to be engaging in this fight and could be doing many other more enjoyable things. It's a way to show just how much he disagrees with the bill.

[SnyderShrugged]

I'd think that raising the minimum wage just raises unemployment. I think it's retarded to say that the government should just stay out of business' way though. If that were the case, America would just be about the super-rich and super-poor.



I must be retarded because it's only common sense to keep the government out of the way of free enterprise. You do realize our nation was founded on the idea of limited government dont you?

[jpillian]

Woo-hoo we are linking the Huffington Post on ES now!

I simply don't understand why some, notice I said some, of my friends on the left seem to think the economy is a zero sum game

Here is a fact: The rich make the pie that much bigger.

You bring up an interesting point SHF -- what is the size of the "economic pie" really dependent upon? Is it some sort of function based on the world's population? Production of the world's population? Standard of living and production of the world's population?

I haven't delved into any macroeconomics since college (seems like a very deep rabbit hole to go down), but I imagine there is a ton of different theories on this.

[TD_washingtonredskins]

I must be retarded because it's only common sense to keep the government out of the way of free enterprise. You do realize our nation was founded on the idea of limited government dont you?

Agreed...it's not a God-given right to be wealthy or own a successful business.

[skinsfan_1215]

I must be retarded because it's only common sense to keep the government out of the way of free enterprise. You do realize our nation was founded on the idea of limited government dont you?

In a modern economy (globalized), government involvement is the only thing that keeps our unskilled laborers from making $2 an hour. Without government involvement, you would just have businesses selling out their jobs to the lowest bidder, regardless of nationality or background. And I can guarantee you that a Mexican or an Ethiopian would work for less money than you.

[Popeman38]

http://www.huffingtonpost.com/2009/01/27/bank-of-america-hosted-an_n_161248.html
Boy if it was clear before then America needs to wake up and realize that the rich people could care less about the middle class. I really believe that America will fall apart because of greed and our leaders will do nothing.Ummmm, all this does is grant unions MORE power. Examine GM for how well that works. :doh: If you eliminate the secret ballot (an Obama campaign pledge), the unions know which employees voted against unionizing. This allows them to strongarm opposition, the reason the secret ballot exists.

And again, the middle class is not in trouble. The middle class of today is the rich of yesterday. 5 TVs, 3 cars, a timeshare, 2 vacations. Yeah, the middle class sure is in trouble. :doh::doh::doh::doh:

[Popeman38]

In a modern economy (globalized), government involvement is the only thing that keeps our unskilled laborers from making $2 an hour. Without government involvement, you would just have businesses selling out their jobs to the lowest bidder, regardless of nationality or background. And I can guarantee you that a Mexican or an Ethiopian would work for less money than you.Turn that around, and you see why companies outsource. Too much regulation makes the market stagnant. See France.

[TD_washingtonredskins]

In a modern economy (globalized), government involvement is the only thing that keeps our unskilled laborers from making $2 an hour. Without government involvement, you would just have businesses selling out their jobs to the lowest bidder, regardless of nationality or background. And I can guarantee you that a Mexican or an Ethiopian would work for less money than you.

To play devil's advocate though, wouldn't that push people all over the world to become more educated and skilled so they would possess qualities that make them "must-haves" for these businesses?

I guess you could make the point that it would light a fire under some people to not just expect to roll out of bed, be an American, and get their $7 an hour if someone is willing to work harder for more money...

I'm not sure where I stand on this issue...but I can see both sides of the coin.

[JimboDaMan]

Woo-hoo we are linking the Huffington Post on ES now!

I simply don't understand why some, notice I said some, of my friends on the left seem to think the economy is a zero sum game

Here is a fact: The rich make the pie that much bigger.That is not a fact, that's a partial truth. There are some who become rich while creating wealth that spreads beyond their own bank account. And there are others who become rich by inheriting money, by commanding an enormous salary (sports and entertainment), or essentially because they are very good at transforming other people's money into their own. Do you remember the snot-nosed securities trader a few months back who retired and wrote a sneering letter "thanking" the Ivy Leaguers who's pockets he picked along the way? There are many examples where being rich simply means you gained more of the pie without making it any bigger.

[SkinsHokieFan]

There are many examples where being rich simply means you gained more of the pie without making it any bigger.

Yes, we call them "lawyers"

[skinsfan_1215]

Turn that around, and you see why companies outsource. Too much regulation makes the market stagnant. See France.

Right, they will outsource for cheaper labor. Unless..... For instance, the GOVERNMENT gives them a tax break or some other incentive to stay here.

[PleaseBlitz]

So, people are still siding with union's despite seeing what is happening in Detroit?

The mind reels.

[Popeman38]

Right, they will outsource for cheaper labor. Unless..... For instance, the GOVERNMENT gives them a tax break or some other incentive to stay here.See, that rhetoric sounds good. But if the tax-incentive saves them $1.5M (random number), but outsourcing jobs saves them $2.0M, it is still a net gain to outsource. And these "incentives" the govt is granting, how are they making up the difference? Simple terms, you have to raise taxes on someone. And those making over $150K will not compensate for these "incentives". Hence why all the tax experts said Obama's plan was not feasible.

[skinsfan_1215]

So, people are still siding with union's despite seeing what is happening in Detroit?

The mind reels.


Unions are important up to a point. When they start holding their companies hostage, however, they become a problem. Unions are just one of many problems Detroit has right now, and by no means their biggest.:2cents:

[Popeman38]

So, people are still siding with union's despite seeing what is happening in Detroit?

The mind reels.Exactly! Ohio and Michigan (forced union) are losing jobs too fast to count. Detroit is almost half the size they were 25 years ago. Meanwhile, NC and Texas (right to work) are adding jobs faster than they can build houses.

[jnhay]

I must be retarded because it's only common sense to keep the government out of the way of free enterprise. You do realize our nation was founded on the idea of limited government dont you?
Good for those people, but if they thought that pure capitalism would be beneficial to the society as a whole I'd say they were wrong. What do the founders of America have to do with anything anyway? I hate when they're brought up to support an argument because even they disagreed with one another. I don't think I would even like many of them if they lived today with the same views.

[skinsfan_1215]

See, that rhetoric sounds good. But if the tax-incentive saves them $1.5M (random number), but outsourcing jobs saves them $2.0M, it is still a net gain to outsource. And these "incentives" the govt is granting, how are they making up the difference? Simple terms, you have to raise taxes on someone. And those making over $150K will not compensate for these "incentives". Hence why all the tax experts said Obama's plan was not feasible.

I was just throwing out an example. I'm no tax expert, so I hope you don't want me to rewrite the tax code to fit these policies I was suggesting.:)

[Popeman38]

Unions are important up to a point. When they start holding their companies hostage, however, they become a problem. Unions are just one of many problems Detroit has right now, and by no means their biggest.:2cents:Detroit was built on auto manufacturing. That is their calling card. Hell, the Fords own the Lions! When the auto industry started shuttering, Detroit started fading. When the foundation of your economy starts crumbling, you are doomed.

[Larry]

Here is a fact: The rich make the pie that much bigger.

And then they charge everybody else rent to look at it. :)

[PleaseBlitz]

Unions are important up to a point. When they start holding their companies hostage, however, they become a problem. Unions are just one of many problems Detroit has right now, and by no means their biggest.:2cents:

Well, we disagree to a point. Unions arent their only problem, but definitely the biggest. The fact that almost all Japanese automakers are still making a profit, even in the US during the recession, and they all build cars on US soil, with American workers, just non-union workers, tells you a lot of the story.

But i agree, they have other problems, management was too slow to adapt to a changing market and the cars they build have no imagination.

Either way, as it pertains to this thread, people complaining about pushback against organized labor and labeling it "the rich just get richer" is utterly ridiculous if you've ever taken economics 101.

[Burgold]

I don't know if this is the place for that thought, but for most of the last ten or twelve years the government has gotten more out of the way of big business and done more to make their lives easier. The rich were given nearly every conceiveable break... even being paid extra by the government to export jobs.

Now, how did that work out? Leaving the rich to their own devices without oversight is what lead exactly to this situation. Someone has to mind the cookie jar and someone has to look out for the little guy. Far too much has been done to enabled the spoiled brats in our economy and far too little has gone towards instilling and enforcing reason and discipline. It's been all candy and credit cards.

We've tried the hyper friendly to the rich approach. This is where it takes you.

[PleaseBlitz]

I was just throwing out an example. I'm no tax expert, so I hope you don't want me to rewrite the tax code to fit these policies I was suggesting.:)

I want your final draft of the new US tax code on my desk by the close of business. Today. :)

[Prosperity]

Woo-hoo we are linking the Huffington Post on ES now!

I simply don't understand why some, notice I said some, of my friends on the left seem to think the economy is a zero sum game

Here is a fact: The rich make the pie that much bigger.

I understand that, I also understand that when people espouse the massive wealth creation that comes with deregulation and free trade with unfair trade partners, they leave out the part where the vast majority of the wealth created goes into the pockets of a very small number of people.

[Thiebear]

pssst. stop voting them in then..
[fail voters] i swear.

[Popeman38]

I don't know if this is the place for that thought, but for most of the last ten or twelve years the government has gotten more out of the way of big business and done more to make their lives easier. The rich were given nearly every conceiveable break... even being paid extra by the government to export jobs.

Now, how did that work out? Leaving the rich to their own devices without oversight is what lead exactly to this situation. Someone has to mind the cookie jar and someone has to look out for the little guy. Far too much has been done to enabled the spoiled brats in our economy and far too little has gone towards instilling and enforcing reason and discipline. It's been all candy and credit cards.

We've tried the hyper friendly to the rich approach. This is where it takes you.The problem is that the govt was too involved in telling the financial sector to loan money to people who couldn't normally qualify. Bush's Ownership Society hurt more than anything else of the last 8 years.

[redskins0756]

Well at least they're finally raising the minimum wage again. I think it'll be up to $7.25 this summer. Thank you Nancy Pelosi.

Yeah and along with that jobs will be lost.

[Hubbs]

You've gotta be kidding me.

Executives and unions are like Batman and the Joker, or Microsoft and Macintosh, or the Redskins and the Cowboys. They'll fight each other for all eternity. This is completely normal behavior.

[PleaseBlitz]

pssst. stop voting them in then..
[fail voters] i swear.


The problem is that the govt was too involved in telling the financial sector to loan money to people who couldn't normally qualify. Bush's Ownership Society hurt more than anything else of the last 8 years.

Management vs Labor has been going on for centuries, regardless of political party, or even regardless of political SYSTEM.



Edit: Hubbs beat me to it. :notworthy:

[Hubbs]

I don't know if this is the place for that thought, but for most of the last ten or twelve years the government has gotten more out of the way of big business and done more to make their lives easier. The rich were given nearly every conceiveable break... even being paid extra by the government to export jobs.

Now, how did that work out? Leaving the rich to their own devices without oversight is what lead exactly to this situation. Someone has to mind the cookie jar and someone has to look out for the little guy. Far too much has been done to enabled the spoiled brats in our economy and far too little has gone towards instilling and enforcing reason and discipline. It's been all candy and credit cards.

We've tried the hyper friendly to the rich approach. This is where it takes you.

Total myth.

http://www.meltingpotproject.com/mpp/2009/01/save-us-regulation-man.html

[techboy]

Well at least they're finally raising the minimum wage again. I think it'll be up to $7.25 this summer. Thank you Nancy Pelosi.

The Minimum Wage and the Labor Market (http://www.clevelandfed.org/research/commentary/2007/050107.cfm) is a study from the Cleveland Fed in May of 2007 (so not that long ago).

It does start with this:


New models of employment show that there are some cases in which a minimum wage can have positive effects on employment and social welfare. The effects depend ultimately on the prevailing market wage and the frictions in the market.

But the next sentence is this:


Evidence to date does not support the view that raising the minimum wage will lead to positive employment effects.

and the conclusion is this:


The analysis presented here omits several important elements of actual labor markets. Many empirical studies have sought to quantify the employment effects of a minimum wage. According to David Neumark and William Washer, who surveyed this literature thoroughly, most evidence suggests that a minimum wage leads to greater unemployment. And contrary to popular belief, most evidence suggests that the least-skilled workers are those most likely to be harmed the most.

So, if you like harming the people one is trying to help, then bravo Nancy Pelosi.

If you ask me, though, that is a true example of the wealthy hurting the poor. Nancy Pelosi doesn't have to worry about whether or not the minimum wage hurts, because she'll never have to work a job that earns it.


There are many examples where being rich simply means you gained more of the pie without making it any bigger.

That's impossible. No matter what said "undeserving" rich person does, it helps.

If he keeps it in the bank, the bank benefits, as do the shareholders of the bank, and the bank then loans it out to others, who also benefit.

If he spends it, then he helps create jobs to service that money. Even yachts need yacht makers, and fine wine needs bottlers.

If he buys stocks and bonds, he is supporting our nation's industry.

Even if he just does something really stupid, and buries it in a hole in the ground, that still takes money out of the overall supply, fighting inflation.

No matter what, the pie grows.

[SnyderShrugged]

In a modern economy (globalized), government involvement is the only thing that keeps our unskilled laborers from making $2 an hour. Without government involvement, you would just have businesses selling out their jobs to the lowest bidder, regardless of nationality or background. And I can guarantee you that a Mexican or an Ethiopian would work for less money than you.


no, the unskilled laborers are the only ones who can keep themselves from earning $2 per hr. They could simply do what everyone else has doone and go out and get a job that pays more than that. Not a difficult thing to consider since we all had to work hard to increase our skillsets to be marketable as employees.

If a business can reduce it;s costs of labor, then by all means, they should.

[deejaydana]

Total myth.

http://www.meltingpotproject.com/mpp/2009/01/save-us-regulation-man.html

:applause:

It amazes me still how many people swallow what media sends their way on a daily basis.

[Big Mac Patty Wack]

A poor man never gave anyone a job.

[JimboDaMan]

That's impossible. No matter what said "undeserving" rich person does, it helps.

If he keeps it in the bank, the bank benefits, as do the shareholders of the bank, and the bank then loans it out to others, who also benefit.

If he spends it, then he helps create jobs to service that money. Even yachts need yacht makers, and fine wine needs bottlers.

If he buys stocks and bonds, he is supporting our nation's industry.

Even if he just does something really stupid, and buries it in a hole in the ground, that still takes money out of the overall supply, fighting inflation.

No matter what, the pie grows.You have a point, but I think its mostly not relevant to the topic. I believe his point was that the actions the rich take to get rich generate wealth which increases the pie. In your examples its not the rich who are doing anything, its the money itself. Matters not whether the holder of the money is rich or poor, although since the poor spend virtually all of their income logically we'd be better off in your formulation if the money went to the poor.

BTW, if this were true, then a sound fiscal policy would be to simply print one trillion dollar bills and give them to me. I promise you I will do my level best to boost the yachting and fine wine industries.:silly:

[techboy]

BTW, if this were true, then a sound fiscal policy would be to simply print one trillion dollar bills and give them to me. I promise you I will do my level best to boost the yachting and fine wine industries.:silly:

I will act as your lobbyist, and will do so for a paltry 1% cut. :D

[Hubbs]

You have a point, but I think its mostly not relevant to the topic. I believe his point was that the actions the rich take to get rich generate wealth which increases the pie. In your examples its not the rich who are doing anything, its the money itself. Matters not whether the holder of the money is rich or poor, although since the poor spend virtually all of their income logically we'd be better off in your formulation if the money went to the poor.

BTW, if this were true, then a sound fiscal policy would be to simply print one trillion dollar bills and give them to me. I promise you I will do my level best to boost the yachting and fine wine industries.:silly:

Yeah, there's a bit of a flaw in techboy's thinking, because he's arguing that wealth itself generates more wealth. This isn't always true - and moreover, the wealth that sits in a bank can very often generate much more wealth if harnessed by, say, a risk-taking entrepreneur who has a good read on his/her particular market.

[JimboDaMan]

Total myth.

http://www.meltingpotproject.com/mpp/2009/01/save-us-regulation-man.htmlI follow links like this all the time, trying to learn something, and I always come away thinking I've found yet another agenda-driven web site making broad assertions without supporting evidence.

For instance, the Community Reinvestment Act has been around for over 30 years without the economy collapsing. It was "beefed up" in the Cinton years, what does that mean? "Beefed up" is a rather thin description of an action that aparently resulted in the loss of $10 trillion or so in wealth, you think we can get some specifics there? I'm not talking about the vague "forced them to take high-risk loans", what exactly does that mean?

I don't see the CRA as the culprit here. You do realize the CRA applied only to banks, right? The huge mortagage companies like Countrywide, who went belly up before the banks did, weren't covered by the CRA yet they dived head first into subprime mortagages. Does anybody have a source for what percentage of home mortages were held by commercial banks vs. mortgage companies an other lenders? I've looked but been unable to find much detail.

I think the second point made in this link is more accurate. Lenders weren't dragged into these bad loans, they willingly gobbled up as many as possible. I think there wer two reasons why, and the article touches on one: because lenders felt they could resell the loans and eliminate teir own risk. The article refers to just the quasi-governmental orgs like Fannie and Freddie, but devices like credit swaps were also a huge factor.

So a false elimination of risk was one major factor, the other being simple greed. There were fortunes to be made here and now, next year be hanged. I've been told by a guy in the credit swap industry that they only had the resources to cover about 1/40th of the packages they wrote. Think about it: you have $1000, you sell a guy $1000 worth of insurance on a loan he made and pocket a nice premium for what you figure to be a largely riskless transaction. Now do that 39 more times, and buy yourself that sweet beemer you've had your eyes on. I think that, much more than the CRA, was the cause of this fnancial mess.

[Hubbs]

Jimbo, I don't think anyone is claiming that the CRA is the sole reason for this collapse. But when you combine penalties for banks that don't dole out subprime loans with forcing Fannie and Freddie to buy up truckloads of subprime loans that private companies make, this is the result.

You blame "greed," but banking has been around for hundreds of years. Never in the history of the concept have bankers decided, en masse, that "next year be hanged" in favor of the short-term benefits of loans that can't be repaid. If this were some byproduct of human nature, we would have seen it in the 1700's.

[techboy]

Yeah, there's a bit of a flaw in techboy's thinking, because he's arguing that wealth itself generates more wealth. This isn't always true - and moreover, the wealth that sits in a bank can very often generate much more wealth if harnessed by, say, a risk-taking entrepreneur who has a good read on his/her particular market.

Just where do you think said risk-taking entrepenuer gets the capital to take those risks? Many times, he gets a loan from that very bank.

[Hubbs]

Just where do you think said risk-taking entrepenuer gets the capital to take those risks? Many times, he gets a loan from that very bank.

You're arguing that there's absolutely no difference in economic activity depending upon how wealth is used. This makes no sense. If that were true, then the proper advice for anyone with money would be that there is literally no difference in what they do with it, because it will ultimately make its way make its way back into loans.

[techboy]

You're arguing that there's absolutely no difference in economic activity depending upon how wealth is used. This makes no sense

You're right. That doesn't make any sense. Of course, I never actually argued that. :)

[Destino]

There are two main arguments when it comes to wealth. The first being the zero sum argument. Some believe that as the gap grows larger this results in those on the poor side getting less. Others believe that this is incorrect and that wealth is being "created" and thus there is more to go around. On this issue I tend to side with those that argue that it is NOT a zero sum game and that the more wealth created the more there is to go around.

The second and the one often ignored by idealists who don't understand what an economy is for, is the political side. Wealth when it becomes large enough and generational creates a ruling class. The stronger that class becomes and the longer it last the more influence they gain. The wider the gap between the rich and the rest the more difficult it is to ever reverse the damage. Permanent wealth and status are dangerous to a system of government such as our own.

The worse it gets the more people will notice that in this country we tax WORK far far far far far greater than we tax investment.

[Prosperity]

There are two main arguments when it comes to wealth. The first being the zero sum argument. Some believe that as the gap grows larger this results in those on the poor side getting less. Others believe that this is incorrect and that wealth is being "created" and thus there is more to go around. On this issue I tend to side with those that argue that it is NOT a zero sum game and that the more wealth created the more there is to go around.

The second and the one often ignored by idealists who don't understand what an economy is for, is the political side. Wealth when it becomes large enough and generational creates a ruling class. The stronger that class becomes and the longer it last the more influence they gain. The wider the gap between the rich and the rest the more difficult it is to ever reverse the damage. Permanent wealth and status are dangerous to a system of government such as our own.

The worse it gets the more people will notice that in this country we tax WORK far far far far far greater than we tax investment.

For example:

government bail out of financial institutions and their stockholders

the entire country is paying an exorbitant amount of money to people who gambled and lost

[GibbsFactor]

Of course the rich get richer and the poor get poorer.

The rich are investing, the poor are using.

It's not that hard to figure out.