Backstage - OOC Forums
General Discussion => The Speakeasy: OOG/Off-topic Discussion => Topic started by: orange on 01 Mar 2011, 21:30
-
So, I am going to throw this out there, but what does the unemployment office's 5 slots provide?
I realize it is "help," but is there actually something to the help?
Does the "help" actually work towards finding a new job?
And to think, it's only going to get worse. We're not creating more jobs as a society, we're trying to get the most work done with the least amount of people in the name of efficiency.
Where is this?
Governments are inherently inefficient, while businesses try to be as efficient as possible.
Western governments have tools at their disposal to shape business efficiencies, but avoid utilizing those tools to keep trade open. A tariff on Chinese made goods that compensated for their labor pricing would have an interesting effect on efficiency. Part of the problem is that while Western-style businesses/governments (specifically the US) operate reasonably capitalist systems, they interact with countries that do not operate such systems internally as if they do.
Add to this what I call the "WalMart Cycle."
The "WalMart Cycle" is when a business outsources its labor to make its goods cheaper to increase sales and supply those with less income with a higher standard of living, but by outsourcing its labor it reduces the average income and thus the number of customers who might have preferred domestic goods and now can not afford anything but the outsourced goods.
The number of jobs worldwide has likely increased in the past 2 years, but different jobs are appearing in different places. We are not seeing as many manufacturing jobs in the West is because they are being outsourced to places that pay their employees. The lowering of trade barriers enables this action by companies.
-
The number of jobs worldwide has likely increased in the past 2 years, but different jobs are appearing in different places. We are not seeing as many manufacturing jobs in the West is because they are being outsourced to places that pay their employees. The lowering of trade barriers enables this action by companies.
If you don't lower trade barriers, then your population ends up paying much higher prices for goods produced less efficiently at home, and they end up even worse off. Protectionism is bad, mmm'kay?
The real problem is that minimum wage laws reduce the ability of the American worker to compete with workers overseas, and thus, fewer Americans are able to work. Personally, I'd rather have a job for 6 dollars an hour than no job at all.
-
The problem is capitalism. Corps are the problem. Killing Corp CEO's when they decide to move the jobs overseas because its cheaper labour would fix the issue. Watch how many jobs move when the workers start killing the the head boss for taking the bread and butter from their lives.
-
The number of jobs worldwide has likely increased in the past 2 years, but different jobs are appearing in different places. We are not seeing as many manufacturing jobs in the West is because they are being outsourced to places that pay their employees. The lowering of trade barriers enables this action by companies.
If you don't lower trade barriers, then your population ends up paying much higher prices for goods produced less efficiently at home, and they end up even worse off. Protectionism is bad, mmm'kay?
The real problem is that minimum wage laws reduce the ability of the American worker to compete with workers overseas, and thus, fewer Americans are able to work. Personally, I'd rather have a job for 6 dollars an hour than no job at all.
Protectionism in a purely capitalist system is bad, agreed. In an ideal world, I support less government involvement in everything.
We do not live in an ideal world.
The issue is that neither the US (or West in general) nor the developing countries operate capitalistic economic systems, governments are involved to varying to degrees and have different goals.
While the goal of country A may be to expand their available raw manufacturing capability, country B may be more interested in protecting its natural resources from over exploitation. If these two countries trade, they have different rules sets under which their companies (nationalized, private, or otherwise) must operate. This creates an imbalance when trade between the two countries is open. Open trade is excellent when both countries operate under the same general set of rules.
-
The problem is capitalism. Corps are the problem. Killing Corp CEO's when they decide to move the jobs overseas because its cheaper labour would fix the issue. Watch how many jobs move when the workers start killing the the head boss for taking the bread and butter from their lives.
No one has a right to a job. To say that you have a "right" to employment is to claim that you have the right to take money from another, whether or not that person believes your services to be worth the money you demand. In short, it is robbery - the allocation of the resources of another to yourself via force.
The reason jobs are moved overseas is because those with political power have made it unfeasible to keep many of those jobs here. Let's say that you are a television company - you make televisions. If company X in Taiwan or India can make televisions of equivalent quality and price for less labor cost than you can, you either have to lower your own labor cost or go out of business. It's not a matter of morality, it's a matter of mathematics, and when governments legislate minimum wage laws, it exacerbates the problem - now hiring people for less in your own country is a crime.
No matter how many people you shoot, the rules of mathematics and economics do not change, as every communist and socialist has discovered.(and don't go talking to me about Norway or Finland being socialist, please - they spend about as much or perhaps less per person than the U.S.) Capitalism allocates jobs according to those who will do the most work for the least pay, and although that may seem cruel, any other system would be insane. Indeed, every other system has been insane. The twentieth centuries' experiments with socialist/fascist and marxist systems resulted in the greatest bloodbaths the world has ever seen. I am hard pressed to consider an advocate of any of those systems as anything less than hostis humani generis.
In addition, to seek to deny jobs to those in developing worlds seems not only regressive in the sense of denying others the right to jobs so that your own might be protected, but racist as well - after all, most areas these jobs are moved to are occupied by peoples that were often denied equal treatment under the law by European colonial powers, as well as their own. Are we truly willing to continue this legacy? Who are we to say that the Indian, the Chinese, or the African does not have as much a right to work as we do?
-
The problem is capitalism. Corps are the problem. Killing Corp CEO's when they decide to move the jobs overseas because its cheaper labour would fix the issue. Watch how many jobs move when the workers start killing the the head boss for taking the bread and butter from their lives.
No one has a right to a job. To say that you have a "right" to employment is to claim that you have the right to take money from another, whether or not that person believes your services to be worth the money you demand. In short, it is robbery - the allocation of the resources of another to yourself via force.
The reason jobs are moved overseas is because those with political power have made it unfeasible to keep many of those jobs here. Let's say that you are a television company - you make televisions. If company X in Taiwan or India can make televisions of equivalent quality and price for less labor cost than you can, you either have to lower your own labor cost or go out of business. It's not a matter of morality, it's a matter of mathematics, and when governments legislate minimum wage laws, it exacerbates the problem - now hiring people for less in your own country is a crime.
No matter how many people you shoot, the rules of mathematics and economics do not change, as every communist and socialist has discovered.(and don't go talking to me about Norway or Finland being socialist, please - they spend about as much or perhaps less per person than the U.S.) Capitalism allocates jobs according to those who will do the most work for the least pay, and although that may seem cruel, any other system would be insane. Indeed, every other system has been insane. The twentieth centuries' experiments with socialist/fascist and marxist systems resulted in the greatest bloodbaths the world has ever seen. I am hard pressed to consider an advocate of any of those systems as anything less than hostis humani generis.
In addition, to seek to deny jobs to those in developing worlds seems not only regressive in the sense of denying others the right to jobs so that your own might be protected, but racist as well - after all, most areas these jobs are moved to are occupied by peoples that were often denied equal treatment under the law by European colonial powers, as well as their own. Are we truly willing to continue this legacy? Who are we to say that the Indian, the Chinese, or the African does not have as much a right to work as we do?
So what your suggesting is all of us in the west should sit and watch our work be sent to overseas so the cock bites in the top office can save money on near slave labour in countries like India, China or the Philippines. Yeah your right, its cruel, and not fair. Its even worse that people in those countries are getting the work and are still poor and lower class.
You seeing a problem with this picture?
-
Which is why fair trade is necessary to ensure competition pays for an Indian child's education. But ANYWAY....
-
This topic really could use a split, but I'd like to point out that A) industrializing nations, while still not well-off by our standards, have much higher standards of living than they did 50 years ago, in part due to increased employment opportunities from multinational firms, and B) while bureaucracies are fun and easy to complain about, the alternative is much worse.
-
The problem is capitalism. Corps are the problem. Killing Corp CEO's when they decide to move the jobs overseas because its cheaper labour would fix the issue. Watch how many jobs move when the workers start killing the the head boss for taking the bread and butter from their lives.
No one has a right to a job. To say that you have a "right" to employment is to claim that you have the right to take money from another, whether or not that person believes your services to be worth the money you demand. In short, it is robbery - the allocation of the resources of another to yourself via force.
The reason jobs are moved overseas is because those with political power have made it unfeasible to keep many of those jobs here. Let's say that you are a television company - you make televisions. If company X in Taiwan or India can make televisions of equivalent quality and price for less labor cost than you can, you either have to lower your own labor cost or go out of business. It's not a matter of morality, it's a matter of mathematics, and when governments legislate minimum wage laws, it exacerbates the problem - now hiring people for less in your own country is a crime.
No matter how many people you shoot, the rules of mathematics and economics do not change, as every communist and socialist has discovered.(and don't go talking to me about Norway or Finland being socialist, please - they spend about as much or perhaps less per person than the U.S.) Capitalism allocates jobs according to those who will do the most work for the least pay, and although that may seem cruel, any other system would be insane. Indeed, every other system has been insane. The twentieth centuries' experiments with socialist/fascist and marxist systems resulted in the greatest bloodbaths the world has ever seen. I am hard pressed to consider an advocate of any of those systems as anything less than hostis humani generis.
In addition, to seek to deny jobs to those in developing worlds seems not only regressive in the sense of denying others the right to jobs so that your own might be protected, but racist as well - after all, most areas these jobs are moved to are occupied by peoples that were often denied equal treatment under the law by European colonial powers, as well as their own. Are we truly willing to continue this legacy? Who are we to say that the Indian, the Chinese, or the African does not have as much a right to work as we do?
So what your suggesting is all of us in the west should sit and watch our work be sent to overseas so the cock bites in the top office can save money on near slave labour in countries like India, China or the Philippines. Yeah your right, its cruel, and not fair. Its even worse that people in those countries are getting the work and are still poor and lower class.
You seeing a problem with this picture?
I suggest nothing. These are facts. We do not have the luxury of charging whatever we wish for our labor, no matter how many price controls or "job-saving" measures we attempt to dictate. We can either choose to have lower wages, but more jobs, or legislate higher wages via minimum wage laws, but have fewer jobs.
The only alternative to that is to outlaw importation of goods, and attempt to subsist merely on the proceeds within a nation's borders. Japan conducted this experiment for centuries, with the result being a drastically lower standard of living and nearly total technological stagnation.
Nor are bad wages the fault of "the rich". Oh, certainly there are those who are greedy or abuse the system, but the fact is, anyone posting on this board is "rich", compared to someone in Somalia. I doubt that anyone here is willing to accept responsibility in any serious way for the plight of those in Somalia. In any case, the riches of any one person in the world have no real bearing on how much is left for everyone else. Wealth is not a pie. If it were a pie, with set portions for all and impossible to create, then wealth would never have existed - we'd still be eating grass and leaves, because Eden or evolution, that's what we started with.
As free trade has increased and capitalism has become the dominant economic doctrine, the living conditions of those in third world countries have become better. This is an empirical fact. China, fifty years ago under centralized economic planning, had massive famines. Today, it is the third most powerful economy. India stagnated for decades until it began free-market reforms, whereupon the wealth of the country and its citizens has grown by leaps and bounds.
This is not to say that capitalism is perfect. Capitalism is imperfect - we have crashes and crises, bubbles and disasters. But nothing on earth is perfect. There is no better economic system to replace capitalism with. This is not a perfect world. There are no solutions to most problems, merely trade-offs. There are no guarantees, no promises. No one is born with a car, house, and clothes. The most we can offer people is the freedom to try with equality before the law. To attempt more than that often ends in disaster. To offer less than that results in nearly incomprehensible levels of misery.
Personally, this can be difficult, especially when one loses one's job. But the good of the many must come before the good of any one person, and capitalism is, on the whole, best for all.
-
"sending jobs overseas" is as much, or possibly more, the "fault" of retailers and outlets, not the companies themselves.
E.g. kitchen appliances. UK used to have a lot of their own manufacturers. Now they don't. Now, kitchen appliances are not a thing any end user buys from the manufacturer straight off, they barely buy from wholesalers. They're things that people buy from retailers. And that's where it starts.
Kitchen appliances are durable products, and people generally only buy them on a few occasions, such as moving out of parents house, getting married, getting divorced, and when the device is no longer serviceable. (We have a blender that is older than I am, for example. It still runs fine.)
As a result, they make ideal gifts. And gifts get purchased at Christmastime. And that means Christmas sales, and big, big discounts! Seriously, it is something like 90+% of kitchen appliances are sold in Dec/Jan in the UK.
This puts pressure on the retailer to obtain quality appliances at low costs, so they can compete with the other retailers. So, they talk to the appliance manufacturers, looking for a good deal.
And, because appliances are not something you just wander up to a factory and purchase one of, retailers have a stronger bargaining position. Manufacturers have to sell to them.
This then puts pressure on the manufacturer to lower costs. But there's a limit as to how low it can go.
And that limit is when Transport Cost of Import < Difference in Labour Costs. There's a point when imports become cheaper than locally made products.
And because of competition between retailers, they'll go for the imports. They have to, or go bust.
Manufacturers then either go overseas, or go bust.
the various campaigns by governments to "buy British" are ineffectual, because people just do not want to pay more for their products, even though it means less jobs for UK people.
And there's not a lot you can do about that.
There are comparitively few jobs that cannot go overseas. Construction (even then that can be done by migrant workers), logistics (moving products from ports to warehouses to end users) and maintenance (of infrastructure, of buildings, of products, healthcare can be included). Everything else, is importable.
-
One thing about minimum wage.
It rises constantly because a person should not work 120 hour weeks to pay their rent and feed their children, the buying power of currency constantly goes down, hence minimum wage is there to keep 'economic prison' forming, in which it fails constantly because the cost of living constantly rises faster than the minimum wage.
Of course one of the problems that was pointed to here was that anyone posting here on these forums live in a better situation than most people in Somalia, a quite current problem that people are facing is being in debt, mainly they are in debt because they have culture/society fed average lifestyle that they try to upkeep by going in debt.
An immigrant that comes from another culture/society has the expectations for a lifestyle being much lower than of someone raised into the native culture of a society.
Hence the low wages would give them more in terms of wealth because their expectations are lower.
On the other hand we have people on the dole expecting to live like middle-class citizen by government handouts.
Its a big fucking mess, to sort it out would take the whole world going self-sufficient for a few years and people figuring out a new paradigm on how to do things, instead of this reactionary paradigm that we have been living under for the past 2000 years.
-
One thing about minimum wage.
It rises constantly because a person should not work 120 hour weeks to pay their rent and feed their children, the buying power of currency constantly goes down, hence minimum wage is there to keep 'economic prison' forming, in which it fails constantly because the cost of living constantly rises faster than the minimum wage.
But the problem is also cyclical.
Lets take the basics: food, shelter, & clothing. It will take a lot of work on someone's part to convince me that there is a scarcity of any of these products/goods in the West. Its quality varies with price, but that is not the point.
The lack of scarcity indicates to me the price is inflated by some means. I can think of two inflationary drivers for the basics: energy & labor. (Materials come into play for hi-tech goods). Worldwide, most economies are fossil fuel driven and is largely controlled by a cartel of states hostile to the West (enough said). Labor varies from state to state and thus the cost of making a basic good vary.
So, as a minimum wage is raised, the cost of products goes up, requiring a rise in the minimum wage to maintain a particular standard of living, requiring the cost of products to go up.
-
People being in debt is the unfortunate result of certain economists falling to the Keynesian theory that consumption is what drives an economy. Thus, governments have sought to emphasize consumption over saving or investing. Combine this with the quite natural desire of companies to sell their products, and we have a society that does not view debt as a bad thing.
Unfortunately, the Keynesian economic models have not proved more successful at preventing boom and bust cycles than the Neo-Classical economic models did, and, in fact, are often held responsible for the stagflation of the seventies, amongst other ills. Keynesian economics predicted that stagflation was impossible, and we probably should have abandoned that model right there. Instead we rehabilitated it.
And, let's be honest - being in debt isn't always bad. The question is whether what you went into debt for will provide you with value over whatever else you could have used the capital and interest for. It's hard to work without a car where I live, so I bought a car. It's more than repaid my investment, because I make more than the car costs with the job I have.
Houses, on the other hand, aren't the greatest investment. A house contributes nothing to your income. Now, its value may go up, but that's speculation, and should be considered to be such, not the surefire investment it was portrayed as. Certainly you need a place to live, but one should consider all the options.
These are merely a couple of examples. But my point is that people being in debt is a cultural phenomenon more than an economic necessity. We have had periods of spectacular economic growth when people were behaving like misers, and we have had busts when people were spending like mad (the latest recession comes to mind). Indeed, it's better for an economy for the average person to have some savings, because they provide a cushion for economic hard times.
The fallacy that minimum wage is necessary to keep economic prisons from forming is demonstrated by the fact that people who contract their services - i.e., many construction workers, some consultants and IT professionals, etc. - are not protected by minimum wage, but can still make a decent living. The reality is that a minimum wage may protect a very few, but for the most part serves more as a barrier to employers hiring those less qualified at all.
It is education and diligence that most protect against poverty. And, in regards to these matters, our government and culture has badly failed. We have a culture of entitlement and willful ignorance, especially in regards to economic education.
-
And I mis-copied in the effort to move it over. Oh well, to sum up:
Stagflation was OPEC's fault.
Houses do increase income through imputed rent.
Minimum wage is a tradeoff between (slightly (http://www.krueger.princeton.edu/90051397.pdf)) reduced employment and increased wages among those who are employed. What we as a nation wish to trade in this respect is determined through the political process.
I'd personally be willing to trade the minimum wage for increases in worker bargaining power and other protections. But that's just me.
-
I'd personally be willing to trade the minimum wage for increases in worker bargaining power and other protections.
I see collective worker bargaining (ie unions) really as subcontracting the workforce. My real issue is when there is no competition in the marketplace, including the labor marketplace.
Who does the employee work for? The company or the union?
-
Germany is the 2nd largest exporter of goods, came out of the recession quickly, and is slowly becoming the definitive European country in terms of economic power.
They did this by having companies boost employee wages, promise no cuts to the workforce until 2015, and support union efforts to help with benefits. The productivity was extremely high afterwards.
It cannot be assumed that a competitive society involves an extremely laissez-faire free market, without regulation or fair practices and standards of any sort. And by that, I mean government, not private standards.
-
Germany is the 2nd largest exporter of goods, came out of the recession quickly, and is slowly becoming the definitive European country in terms of economic power.
They did this by having companies boost employee wages, promise no cuts to the workforce until 2015, and support union efforts to help with benefits. The productivity was extremely high afterwards.
It cannot be assumed that a competitive society involves an extremely laissez-faire free market, without regulation or fair practices and standards of any sort. And by that, I mean government, not private standards.
You misrepresent what Germany did, exactly. What Germany did was work with businesses to allow them to cut back worker hours without out-and-out firings. They also have the benefit of having an aging workforce to keep unemployment low.
http://www.weeklystandard.com/blogs/why-germanys-unemployment-rate-lower (http://www.weeklystandard.com/blogs/why-germanys-unemployment-rate-lower)
But even more interesting is what you fail to disclose: that Germany approved deep and drastic cuts in government spending.
http://www.independent.ie/business/european/german-cabinet-approves-euro816bn-spending-cutbacks-2250382.html (http://www.independent.ie/business/european/german-cabinet-approves-euro816bn-spending-cutbacks-2250382.html)
What Germany did is the exact opposite of what Keynesian economics recommends - reducing spending and cutting welfare. That they worked out employment programs is irrelevant to this larger fact. So are unions, since unions exist mostly (only?) within free markets as opposed to socialist ones. I have no quibble with unions so long as membership is voluntary.
And of course there is a place for regulation. But governments have no incentive to make regulation feasible for a business to follow, or to ensure that businesses can follow regulations and still remain profitable. Indeed, since many bureaucracies are funded by fines for violations, governments have an incentive to ensure that regulations are impossible to follow. Many regulations, in fact, are. For example, in California, a painting company finishing a normal one-story home might charge $6000. However, if that house was constructed prior to 1979, the regulations it will be required to follow in regards to lead paint might well raise that price to $20,000 or even up to $40,000, depending on the conditions. What will happen? The homeowner will either hire someone without a license to do the work, or will do the work themselves. This is merely one example - I could give you many more. The EPA has no incentive to make the regulations feasible to follow, only an incentive to ensure that they can't be sued.
My boss went to the class, looked at the regulations, and upon consultation with his foreman (me), we decided never to paint another house that could possibly have lead paint in it again. We know how to deal with lead paint, and we know the common sense procedures for working on older houses, but we will not risk our livelihoods and lose money by doing the work. I imagine that most other contractors will feel the same. The end result is that more people are going to be poisoned by lead paint because they don't know how to remove it or paint over it safely.
What worries me these days is that when I point out situations like this to many people, especially the young, there is no recognition of there being any problem or fault with the regulation or the government. Instead, the anger is often directed at me or whoever is affected by the regulation, in that we don't just shoulder the burden ourselves, as if we have some duty to go bankrupt in service of and to our fellow man. There is no recognition that we live in a world where businesses and employers have finite wealth and time, that we don't exist solely to employ and provide for others.
I look askance at "regulation" because it almost invariably means destruction of my ability to create wealth - stealing my time and energy to comply with rules that often counter in effect their specified purposes. I look askance at "fair practices" because it usually means laws favoring specific groups or individuals, almost always at my expense. I despise the imposition of government "standards", because they are the standards of the most useless people in society, those who create nothing: the politicians and bureaucrats. All I want is a clear field where I can buy and sell freely, and where agreements are enforced. I make no special pleading, and I despise those who do.
-
People being in debt is the unfortunate result of certain economists falling to the Keynesian theory that consumption is what drives an economy. Thus, governments have sought to emphasize consumption over saving or investing. Combine this with the quite natural desire of companies to sell their products, and we have a society that does not view debt as a bad thing.
Unfortunately, the Keynesian economic models have not proved more successful at preventing boom and bust cycles than the Neo-Classical economic models did, and, in fact, are often held responsible for the stagflation of the seventies, amongst other ills. Keynesian economics predicted that stagflation was impossible, and we probably should have abandoned that model right there. Instead we rehabilitated it.
And, let's be honest - being in debt isn't always bad. The question is whether what you went into debt for will provide you with value over whatever else you could have used the capital and interest for. It's hard to work without a car where I live, so I bought a car. It's more than repaid my investment, because I make more than the car costs with the job I have.
Houses, on the other hand, aren't the greatest investment. A house contributes nothing to your income. Now, its value may go up, but that's speculation, and should be considered to be such, not the surefire investment it was portrayed as. Certainly you need a place to live, but one should consider all the options.
These are merely a couple of examples. But my point is that people being in debt is a cultural phenomenon more than an economic necessity. We have had periods of spectacular economic growth when people were behaving like misers, and we have had busts when people were spending like mad (the latest recession comes to mind). Indeed, it's better for an economy for the average person to have some savings, because they provide a cushion for economic hard times.
The fallacy that minimum wage is necessary to keep economic prisons from forming is demonstrated by the fact that people who contract their services - i.e., many construction workers, some consultants and IT professionals, etc. - are not protected by minimum wage, but can still make a decent living. The reality is that a minimum wage may protect a very few, but for the most part serves more as a barrier to employers hiring those less qualified at all.
It is education and diligence that most protect against poverty. And, in regards to these matters, our government and culture has badly failed. We have a culture of entitlement and willful ignorance, especially in regards to economic education.
Hard to tell that to people earning roughly say 1000$ per month, then having to pay half of it for their house, another quarter for taxes, and the little bits that are still there for food and supplies. And I am speaking of people earning the minimum salary.
Those are not the products of Keynesianism and consumerism. Some are getting in debt because they are caught by the "consume moar" capitalist doctrine, but some are crippled by debts because they do not have any other choice (which adds even more things to pay each month).
Remember the subprime lendings that fucked up a part of the international economy : typically that kind of crap that can happen when you have not enough regulations.
-
Those are not the products of Keynesianism and consumerism. Some are getting in debt because they are caught by the "consume moar" capitalist doctrine, but some are crippled by debts because they do not have any other choice (which adds even more things to pay each month).
Remember the subprime lendings that fucked up a part of the international economy : typically that kind of crap that can happen when you have not enough regulations.
"Consume moar" is not a capitalist doctrine. Consumerism and capitalism are not co-dependent and consumerism can be bad for capitalism. Consumerism pushes product quality down (it will be thrown away anyway); capitalism works fine in a conservationist culture where people save and focus on purchasing quality (over quantity) goods. The spiral goes both ways and is driven by the habits of those taking part in the economy. Consumerism is easy and requires little thought on the parts of the participates, while conservation requires participates to think through the choices they make and make sound purchasing decisions.
Also, people forget that the sub-prime lending in the US was encouraged by the government in the political pursuit of increased home ownership. A business bank does not want to loan money to those it does not think will be able to pay back the loans, that is bad business. Markets do regulate themselves contrary to what many think. Government involvement leads to things like leaving perfectly arable land fallow and banks having to provide unaffordable loans to people living outside their means.
-
Hard to tell that to people earning roughly say 1000$ per month, then having to pay half of it for their house, another quarter for taxes, and the little bits that are still there for food and supplies. And I am speaking of people earning the minimum salary.
A far better method of helping these people is through positive action, such as a negative income tax, rather than through the negative action of setting an arbitrary standard at which people must be paid. It's all very well and good to say that everyone deserves a "living wage", but what if what a person does just isn't worth $7.25 an hour? The law requires then that either the employer hire the employee at a loss (not going to happen), or that the employer simply not hire the employee at all (happens quite a bit). Furthermore, since prices (according to a study in the U.K.) rise faster in areas with a minimum wage, one must question exactly what good it does to have more money if everything costs more as well.
What the poor need is money, but instead of giving them money and letting them decide how to spend it, we have instituted programs with vast administration costs and sketchy effectiveness. A negative income tax or other straight payment to those who work would be far simpler to plan and execute, as well as far more effective in alleviating poverty, rather than simply making it bearable. But I do not think that those who administer welfare programs are interested in alleviating poverty - if they did alleviate it, they would be out of a job.
Those are not the products of Keynesianism and consumerism. Some are getting in debt because they are caught by the "consume moar" capitalist doctrine, but some are crippled by debts because they do not have any other choice (which adds even more things to pay each month).
I've seen very few people crippled by debts they didn't choose to have. There are some, certainly, but are we to make the purpose of society insuring the unlucky? Most people who I've seen living in poverty made choices to spend money or assume responsibilities (children, pets, a house, etc.) that they had no reasonable business assuming. If you choose, for example, to have kids when you do not have the means to support them, why should someone else be penalized for your actions? And if we are looking to the benefit of the children in such cases, very well, but let us remove them from their parents who cannot support them.
Remember the subprime lendings that fucked up a part of the international economy : typically that kind of crap that can happen when you have not enough regulations.
Whether or not that kind of crap can happen when you do not have regulation is irrelevant to the last crisis. The last crisis has plenty of villains in both government and the private sector, but it's a matter of documented fact that many in the regulatory agencies simply chose not to apply regulations that would have prevented many of the excesses.
I would have to argue, however, that the greatest fault lies in the private rating agencies such as Moodys, who told the investment houses and banks that the CDOs, synthetic and otherwise, were sound. Here are some articles detailing some of the fallout:
http://www.globalresearch.ca/index.php?context=va&aid=12731 (http://www.globalresearch.ca/index.php?context=va&aid=12731)
http://www.cbsnews.com/stories/2010/06/02/business/main6540637.shtml (http://www.cbsnews.com/stories/2010/06/02/business/main6540637.shtml)
http://www.bloomberg.com/news/2011-01-26/moody-s-assumed-4-annual-rise-in-home-prices-in-model-for-credit-ratings.html (http://www.bloomberg.com/news/2011-01-26/moody-s-assumed-4-annual-rise-in-home-prices-in-model-for-credit-ratings.html)
But who made the rating agencies the arbiters of what was sound and what was not? Ah, yes, our government: http://voices.washingtonpost.com/ezra-klein/2009/09/how_the_government_helped_mood.html (http://voices.washingtonpost.com/ezra-klein/2009/09/how_the_government_helped_mood.html)
Of course, as Orange notes, you also had massive government encouragements and incentives to buy bad loans. I can go into deeper detail on that at some other time. For now, I have to get to work...but one last thing...
I love business, but not businesses who cheat their customers, who engage in corruption, or who work with the government to establish effective monopolies - which is how almost all monopolies are established. It may be true that there are areas where there is not enough regulation, but it's rarely that simple. In almost all cases, there is either too much regulation, and/or regulations are badly and incompetently designed. In the worst cases, of which there are distressingly many, regulations are designed to be impossible to follow, so that everyone engaged in a certain field of endeavor will be constantly under the power of the regulating agency.
-
You type a lot Vikarion.
-
I basically agree with you Vikarion on the fact that income taxings are much better than arbitrary standards, though minimum arbitrary standards such as minimum wages are needed to be sure people are not exploited. On any basis though, income taxes are another form a state regulation.
I do not know well enough the american system so I won't be able to speak very well about the precise effects of the US administration concerning employment. Its works in France, even if it is not perfect, so I am probably more inclined to think without minimum wages people would just get exploited, because until we get in a reverse situation where workers are in shortage, now we still have often too few jobs. That way companies dictate the terms, and not employees. We see that everyday with people being employed illegaly (mostly immigrants) for a misery. They have no choice indeed : better to be paid almost nothing than nothing. But those illegal jobs indicate quite clearly to me that employers will mostly always do what they can to stay competitive with lower costs, especially if they are NoH like.
I've seen very few people crippled by debts they didn't choose to have. There are some, certainly, but are we to make the purpose of society insuring the unlucky? Most people who I've seen living in poverty made choices to spend money or assume responsibilities (children, pets, a house, etc.) that they had no reasonable business assuming. If you choose, for example, to have kids when you do not have the means to support them, why should someone else be penalized for your actions? And if we are looking to the benefit of the children in such cases, very well, but let us remove them from their parents who cannot support them.
Heh, always the problem between helping the helpless while opening a way for the rest to exploit the system, or let the helpless starve to avoid such exploits.
Honestly the example I took where people have to loan to survive is real (but marginal as you said), but the main problem is that most of the people that barely survive do not loan. And sometimes it is not for choices like children, dogs, investments, etc. That can be divorced women (pretty frequent), that do what they can to survive with their children. Ah yes, you might argue that they chosed to have children and marry with someone that let them down eventually, and that people should not be asked to pay for their "mistake". Well, I call that solidarity. That can also be retired people that are not earning enough money from the government to survive (not sure how it is in other countries, but it is starting to get really worrying here). We might argue they have chosen a job that was not paying them well and did not saved enough to live the end of their life. Easy to say.
I love business, but not businesses who cheat their customers, who engage in corruption, or who work with the government to establish effective monopolies - which is how almost all monopolies are established. It may be true that there are areas where there is not enough regulation, but it's rarely that simple. In almost all cases, there is either too much regulation, and/or regulations are badly and incompetently designed. In the worst cases, of which there are distressingly many, regulations are designed to be impossible to follow, so that everyone engaged in a certain field of endeavor will be constantly under the power of the regulating agency.
I mostly agree I suppose.
"Consume moar" is not a capitalist doctrine. Consumerism and capitalism are not co-dependent and consumerism can be bad for capitalism. Consumerism pushes product quality down (it will be thrown away anyway); capitalism works fine in a conservationist culture where people save and focus on purchasing quality (over quantity) goods. The spiral goes both ways and is driven by the habits of those taking part in the economy. Consumerism is easy and requires little thought on the parts of the participates, while conservation requires participates to think through the choices they make and make sound purchasing decisions.
Also, people forget that the sub-prime lending in the US was encouraged by the government in the political pursuit of increased home ownership. A business bank does not want to loan money to those it does not think will be able to pay back the loans, that is bad business. Markets do regulate themselves contrary to what many think. Government involvement leads to things like leaving perfectly arable land fallow and banks having to provide unaffordable loans to people living outside their means.
I agree on the fact consumerism is not a capitalist doctrine, but it comes from it, wanted or unwanted, that is what I meant.
Concerning banks and loans, yes, indeed, bad business to loan to people unable to pay back. Still, they do it quite often for the only reason that bank employees often overstep their bonds just to make more contracts (this is one of many causes), and overdebts have been increasing at an alarmist rate in some countries. This is still not a whole plague, but it is here.