I just hope you didn’t vote for Nader in 2000 . . . So, what party are you involved in now, if any?
I specifically said that it is not always the case. We’re talking now, not in general.
I think auto companies are doing well, but for the most part China is still resistant, India is protectionist, and Europe is a mess. Overseas markets are as likely to hurt as help at the moment.
I haven’t seen a lot of financial reports that say profits are due to rising prices, except some commodities. Too little demand in most cases. While inflation is low, it is non-zero, and a raise at the inflation rate is a good one these days. And of course high unemployment depresses wages. Offshoring does keep prices low, but has probably got as low as it is going to get due to health and safety concerns.
All misdirection. Improved productivity builds long term wealth. Productivity has been improving, and so have profits. Now, if the rich got richer and the poor got richer, like in the '90s, there would be a lot fewer people complaining. But productivity gains have been going primarily into the pockets of the “richer” - top 10% or so, I’d say. Talking about Bill Gates is immaterial. Notice how he gave out stock options to more than just the top execs in the early days of the company, and thus built wealth across a broad range of employees. If that were the norm we’d not be having this conversation.
What the government can do is another matter. If we take the money from the richest and feed it back into the economy in the form of infrastructure and jobs we might be able to improve consumption and reduce unemployment. Clearly the states, which did the opposite, did not help the recovery at all. Minimum wage increases will help some. If everyone must funnel some of their profits into higher wages we might improve consumption.
Improved profits through new products and better sales can go on a long time. Improved profits through screwing workers is limited. Pretty soon it will stall out, and then we will see another crash. So paying enough to spur consumption is in everyone’s long term interest, though not in their short term interest. So I expect they will hit the wall and wonder why.
I don’t know what you mean by misdirection. You jumped into the middle of a discussion I was having with septimus and essentially changed the topic of that discussion. I am simply objecting to his insistence that the rich are getting richer and that must mean the poor are getting poorer. Nothing else. I honestly don’t understand what your point is.
Cite? For septimus’s alleged insistence? Here are the only relevant early quotes from septimus that I find:
[QUOTE=septimus]
Rising inequality in U.S.A. is clearly a problem
…
the major source of rising U.S. inequality is not high salaries, but high unearned income, e.g. gains to stockholders. Corporate profit margins have been soaring even as taxes on dividends and gains have been cut.
[/QUOTE]
Does this translate to an “insistence that the rich are getting richer and that must mean the poor are getting poorer.”?
Please address this. I’m sure we’d both agree that imputing viewpoints to another falsely does detract from a debate.
The quote you were replying to specified the possibility of increased productivity with no salary increase. Is a person who is more productive, but not better compensated, relatively worse off than he was before? What if the extra productivity comes from working longer hours or taking less vacation? In one sense, he’s no poorer than he was, but stagnant wages and low inflation aren’t the whole story.
More likely, the increased productivity is due to technology. Sure, sometimes it’s workers being more efficient without the help of technology, but just look at how we live our lives now.
How many bank tellers does a bank need now that ATMs do most of the work? Cashiers? You can have self-checkout. When I first started driving, no one pumped his own gas. Who doesn’t do that now? Airline check in agents? It is to laugh-- get thee to the kiosk!
True, but the technology doesn’t run itself. An airline check-in agent these days needs to know everything her predecessor did (for those times when the kiosks are down) and how to manage the kiosks. It takes a lot of people to implement things like that; I don’t see a good reason why the ensuing gains should go only to a few.
Still looking, but I’m looking hardest at the Georgia Green party, mostly because they seem better organized than a lot of other progressive outfits (not saying much) and because their views on Obama and the Democrats align very well with mine. And no, I didn’t vote for Nader, in fact, I voted for Obama in 2012 and I feel like a damn fool for having done so.
Greens? Pfft. Too rigidly weirdeological. Their “Key Value” of decentralization is more an obstacle to a progressive agenda than anything else. Check out the Working Families Party.
So you admit that money in a savings account has not been taken out of the economy. We are making progress
What you are missing in the farmer analogy is that both farmers are helping out the economy by spending. Farmer A is stimulating the hooker and cheap wine industries, and Farmer B is benefiting the fertilizer industry. Thus everything you said about Farmer A applies to Farmer B.
The most important part of the analogy is that in the long run you can not consume more than you produce. If everyone in the economy were like Farmer A then the economy would not grow, even though every dollar earned is spent. However since no new production is occuring then no new consumption can happen.
Since Farmer B is producing more, then more can be consumed. Farmer B will consume the equivalent of 20 bushels of corn more than Farmer A. If everyone in the economy acted like Farmer B then the economy will grow and everyone will be rich.
What you miss about taxes on investments are they are taxed twice. If I earn 100 dollars, I am taxed on that. If I spend all the money that is all the government gets. If I invest the after tax money and make money on that, then I am taxed again.
The productivity improvement of the '90s was in large part due to technology, as the promise of the computer, long delayed, finally paid off. But what significant productivity increases through technology have their been recently? What we have seen are companies producing roughly the same amount of output with reduced staffing. That reduced staff, working harder, has not been getting salary increases.
Robot Arm’s comment on the need for higher skills (which explains in part the big differential in unemployment based on education ) is correct also, but I’m not sure it is the major factor at the moment.
In my experience, salary increase seem to go with hiring, not with increased productivity through layoffs. This could be because companies who hire have more money and desire to improve the workforce, or it could be because hiring means that employees have more of a chance to leave and thus need to be paid better.
Not on the money you invested - only on the new money you earned.
Isn’t one common liberal argument that middle/lower class wages have been stagnant for (I believe the most commonly quoted statistic is) thirty years now? If true, that could arguably mean that the poor are getting poorer (they’re not earning any less, but what they earn is buying less with time).
(Sorry if I missed a discussion that mentioned this; I couldn’t find any such reference.)
I agree with this but I think it’s taken out of context. We shouldn’t be putting a cap on how much somebody can earn or holding it against them. Actually, I think we should be doing the opposite and encouraging growth.
The real problem is poverty. 50 million americans are living in poverty while the richest 1-10% horde enough wealth to either fix that problem or put a big dent in it.
If we had enough social programs in place to prevent poverty and protect the most vulnerable among us, income inequality wouldn’t even be an issue. Furthermore, it would be better for all of us as it would lead to a more educated, safe, and peaceful society.
Of course, that would mean raising taxes. It’s nice to think about these things. Kind of like “what would I do if I won the lottery?”
John Mace didn’t answer, so I appeal to other Dopers.
Is John’s characterization
a valid inference from my remarks:
[QUOTE=septimus]
Rising inequality in U.S.A. is clearly a problem
…
the major source of rising U.S. inequality is not high salaries, but high unearned income, e.g. gains to stockholders. Corporate profit margins have been soaring even as taxes on dividends and gains have been cut.
[/QUOTE]
If Dopers say yes, I apologize to all and will review my posts more carefully in future.
If Dopers say no, I still apologize for being unnecessarily irritable, but offer the weak defense that mischaracterization can be irritating. 
I suppose not; you say that it’s a problem, but don’t elaborate why, or for whom it is a problem. Assuming that it’s a problem for the non-rich, and that the problem is a worsening of their material circumstances isn’t a huge reach, but it is a reach.
That said, you didn’t really correct the misunderstanding, when your next post, #58, started with:
That can easily be taken as you validating his assumption.
The funny/sad thing is that both John and I apparently agreed with the following all along:
Some enrichments represent new wealth, and hence don’t cost others.
Some enrichments do not “add value” and effectively reduce others’ wealth.
Each of us thought, or pretended to think, that the other was holding a black-white position. One can point to comments by both John and myself where adding even a single adjective (e.g. “some” or “often”) could have broken the miscommunication.
All in all, a masochistic sub-debate. I’m not sure whether John or I was more to blame, but I will try to write a bit more carefully in future.
Most of the time I have heard the argument, they are talking about constant dollars.
Regards,
Shodan
A couple of points:
- Confusing wealth with income makes for bad policy. One of our fundamental difficulties is that it is easy to be wealthy and have an artificially low income. It is equally easy to have a high income and pay an extraordinary percentage of that income in various taxes. One of the most fundamental issues we have is wealth disparity, and this is much more complex than income disparity because it’s almost impossible to tax wealth.
- The US is relatively unique for being as heterogeneous as it is, as welcoming to legal and illegal immigrants as it is, and being as wealthy in toto as it is.
What drives low wages is a surplus of workers for any given job all along the spectrum of available positions. If you just want to make a start raising income levels at the low end, get rid of the ten million plus illegal immigrants competing for those jobs (a number roughly equal to the number of unemployed). The guys who mow my lawn, clean my hotel room and wash my restaurant dishes are not typically documented, but they are willing to work their ass off for almost any wage. This is admirable, but from an economic standpoint, creates a surplus of cheap labor that makes it far more difficult for ordinary economics to drive better wages. If the rich have two people competing with one another for the same job to take out the trash, it’s much easier to pay a low wage. A plethora of low wage workers at the lowest end drives down wages all the way up the wage spectrum, each category pulling in increasingly overqualified workers competing for lower-yield jobs; competition for jobs lowers wages when there is a surplus of qualified workers competing for that job.
We have long since passed the tipping point where such an action (deporting illegal immigrants) is possible, and as a generous and wealthy nation few of us want to refuse admission to our club when we ourselves have benefited so tremendously as historic immigrants, bullying our way in before legal immigration was invented. Economic reality nevertheless always wins, and the plain facts are that we have a surplus of labor for diminishing opportunities in the sorts of jobs that have historically been available to the majority of the population. That we have even been able to retain the income levels we have for the vast majority in such a heterogeneous group is a surprise for me.
Actually it would result in less income inequality if the horde had the wealth, as opposed to the rich hoarding it.