# Sam Stone believes Trump's tweets **URL:** \ **Category:** The BBQ Pit\ **Created:** [October 10, 2020, 1:47pm UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633 "2020-10-10T13:47:45Z")\ **Posts on this page:** 20\ **Page:** 51
**Author:** ![crowmanyclouds](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/crowmanyclouds/32/19884_2.png) [@crowmanyclouds](https://boards.straightdope.com/u/crowmanyclouds)\ **Post date:** [August 16, 2021, 4:37pm UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1004 "2021-08-16T16:37:20Z")
Antifa… I mean, my dog ate my cite. ---
**Author:** ![Kropotkin](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kropotkin/32/18045_2.png) [@Kropotkin](https://boards.straightdope.com/u/Kropotkin)\ **Post date:** [August 22, 2021, 12:48am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1005 "2021-08-22T00:48:09Z")
Sam has also indicated he is a Milton Friedman monetarist, which is, ah, let’s say, remarkable, in this day and age. ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [August 22, 2021, 1:49am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1006 "2021-08-22T01:49:49Z")
Shocker: I also believe in free markets. The horror. And I refuse to take economic criticism from an ‘anarcho-Communist’. Only idiots and idealogues believe that crap. It’s like taking advice on astronomy from an astrologer. ---
**Author:** ![running\_coach](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/running_coach/32/15836_2.png) [@running\_coach](https://boards.straightdope.com/u/running_coach)\ **Post date:** [August 22, 2021, 1:55am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1007 "2021-08-22T01:55:44Z")
> [@Sam\_Stone](#): > > Shocker: I also believe in free markets. The horror. > > And I refuse to take economic criticism from an ‘anarcho-Communist’. Only idiots and idealogues believe that crap. It’s like taking advice on astronomy from an astrologer. - Much like the idiots who believe “supply side” and “trickle down” economics. ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [August 22, 2021, 2:13am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1008 "2021-08-22T02:13:53Z")
Oooh… Buzzwords. Do you actually know what they mean? I’d love to hear your description of trickle-down economics and supply side economics, and why they don’t work. Be specifiic. ---
**Author:** ![running\_coach](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/running_coach/32/15836_2.png) [@running\_coach](https://boards.straightdope.com/u/running_coach)\ **Post date:** [August 22, 2021, 2:23am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1009 "2021-08-22T02:23:20Z")
> [@Sam\_Stone](#): > > Oooh… Buzzwords. Do you actually know what they mean? I’d love to hear your description of trickle-down economics and supply side economics, and why they don’t work. Be specifiic. - Supply side is where business is given tax breaks, reduced regulations and other incentives to increase production while leaving the consumer base without the extra money to buy the products. Trickle down is thinking that by further enriching the highest income levels, they’ll throw a few crumbs to the working class. You know what else trickles down? Urine. ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [August 22, 2021, 2:52am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1010 "2021-08-22T02:52:29Z")
Yeah, that’s pretty much what I thought you’d say. ‘Supply side’ isn’t about ‘the rich’. It’s about removing barriers to wealth creation through business, and it applies equally to your neighbor the landscaper and your local corner restaurant as it does Jeff Bezos. In fact, giant corporations love regulations and taxes, as they are large enough to handle the legal load and they have lobbyists to twist them to their benefit. They simply push the taxes down to their customers. Supply side mostly helps small businesses and entrepreneurs who cannot afford lawyers and accountants for regulations and who are chronically short on capital for expansion. Job creation suffers, snce small businesses create the majority of new jobs. So high tax, high regulation economies depress the middle class and slow down entrepreneurship and small business formation, but they have plenty of oligarchs and giant corporations. They become less dynamic and lower growth, but the rich do fine. For example, Europe is full of old money wealthy people. America’s billionaires are mostly self-made. And there are more billionaires in Europe than America, despite their high taxes and regulations. Or because of them. Ever wonder why the fortune 500 votes for Democrats, while the Chamber of Commerce types vote Republican? As for trickle-down, those ‘scraps’ include cell phones, air bags, electric cars, cheap airplane travel, abs brakes, yada yada. All things developed for the rich, which trickled down to everyone. But trickle down is more than that - it’s also about retaining dapital in the private economy so that investment and development take place. Capitalism takes capital, and capitalism works. It works far better than anything else we ever tried. And capitalism IS trickle-down. ---
**Author:** ![crowmanyclouds](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/crowmanyclouds/32/19884_2.png) [@crowmanyclouds](https://boards.straightdope.com/u/crowmanyclouds)\ **Post date:** [August 22, 2021, 3:01am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1011 "2021-08-22T03:01:55Z")
I woulda gone with, ‘They’re the greatest economic ideas humans have ever had and humanity owes a great debt to the man who thought them up, Ronald Reagan PBUH!’ ---
**Author:** ![JohnT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnt/32/15048_2.png) [@JohnT](https://boards.straightdope.com/u/JohnT)\ **Post date:** [August 22, 2021, 3:46am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1012 "2021-08-22T03:46:40Z")
You know Sam, I literally have a degree in economics, have written extensively on this Board, and my Substack is dedicated to the moral and economic failure which is modern conservative economics, and I have done all this… without a single word in response from you, so let’s talk. The definition of ‘trickle down’ is when a plutocrat pisses on you. Cite: [![Imgur](https://live.staticflickr.com/65535/51336808401_4d7c1b8ff9_z.jpg "Income Growth 1949-2012") ](https://www.flickr.com/photos/68782016@N08/51336808401/) [![Imgur](https://live.staticflickr.com/65535/51029262662_644eeec107_b.jpg "2021-03-12\_08-56-07") ](https://www.flickr.com/photos/68782016@N08/51029262662/) [![Imgur](https://live.staticflickr.com/65535/50993141016_fdf56ffba2_b.jpg "1609611178222") ](https://www.flickr.com/photos/68782016@N08/50993141016/) [![Imgur](https://live.staticflickr.com/65535/50993256307_864126d2c2_b.jpg "1609610894560") ](https://www.flickr.com/photos/68782016@N08/50993256307/) I live in a state which is a conservatives wet dream and we can’t keep the power on during the cold or the heat. [![Imgur](https://live.staticflickr.com/65535/50950441801_9cfa147924_b.jpg "20210216\_073818") ](https://www.flickr.com/photos/68782016@N08/50950441801/) [![Imgur](https://live.staticflickr.com/65535/50950537067_bd70dd3917_b.jpg "20210216\_082238") ](https://www.flickr.com/photos/68782016@N08/50950537067/) The theories themselves are crap, mere justification for the enrichment of plutocrats, 40+ years of conservative policy implementation has brought horrible results, and the entire rotten, morally broken edifice of ‘supply side economics’ needs to be cast aside for this country to survive. Which is not your concern, of course, not living in the United States. So stop telling us that we need more shit. Because that’s what Reaganomics is. [![Imgur](https://live.staticflickr.com/65535/50993258012_2c6943d079_b.jpg "1609642568399") ](https://www.flickr.com/photos/68782016@N08/50993258012/) [![Imgur](https://live.staticflickr.com/65535/50992443383_0fbcb69767_b.jpg "1609611029411") ](https://www.flickr.com/photos/68782016@N08/50992443383/) But, yeah. Let’s talk. What do you wish to discuss? ---
**Author:** ![JohnT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnt/32/15048_2.png) [@JohnT](https://boards.straightdope.com/u/JohnT)\ **Post date:** [August 22, 2021, 4:10am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1013 "2021-08-22T04:10:14Z")
Laffer Curve. Drawn on a napkin in a DC restaurant in 1974, the Laffer curve… a simple supply/demand curve applied to tax rates… has become gospel and, by itself, represents of of the towering intellectual underpinnings of the modern conservative movement. The general idea, as perverted by conservative politicians and their ill-informed lackeys, is ‘to raise tax revenues and release the power of innovation, one needs to cut marginal tax rates on the wealthy’, which has been even more simplified as ‘cutting taxes spurs economic growth’, all accepted as Truth without even bothering to see if it is correct. Hint: it is not. This Cato study, in 1981, explains how it can fail: [![Imgur](https://live.staticflickr.com/65535/51394071973_8005e66307_b.jpg "Cato supply side Laffer Reaganomics") ](https://www.flickr.com/photos/68782016@N08/51394071973/) Effectively, the author concedes: if government revenues do not rise, and the government does not cut spending, a situation will arise where the government must issue debt. This invalidates the benefit received from the Laffer curve as in order to pay back the debt, the government will require a tax increase in the future, resulting… the author notes… in no net benefit. But, wait! He saves the Laffer curve literally _with an emotional and ideological appeal which has nothing to do with economics and should not be in an academic paper_. I mean, this is embarrassing babble: ‘There are many other good reasons for cutting taxes. Taxation takes from us what is ours and denies our freedom to use our income in any peaceful way we see fit. It denies our civil liberties’2 and reduces our material well-being’ Which is why I call this, Sam, ‘faith based economics’. Because the data doesn’t support it, but y’all take it as an article of faith that your unproven statements are fundamental axioms and you use appeals to emotions like the above even in academic studies. 🙄 ---
**Author:** ![JohnT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnt/32/15048_2.png) [@JohnT](https://boards.straightdope.com/u/JohnT)\ **Post date:** [August 22, 2021, 4:57am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1014 "2021-08-22T04:57:29Z")
> [@Sam\_Stone](#): > > As for trickle-down, those ‘scraps’ include cell phones, air bags, electric cars, cheap airplane travel, abs brakes, yada yada. All things developed for the rich, which trickled down to everyone. But trickle down is more than that - it’s also about retaining dapital in the private economy so that investment and development take place. This is so wrong I’m worried you don’t have a grasp of the subject. Trickle down refers to flows of capital, not innovations. It is _presumed_ that the increased flows will result in investments and innovation/inventions, and this presumption is used to sell this horse hockey, but the next innovation one can definitively prove was a result of pissed-on economics will be the first. Look at the incoherence of this Investopedia explanation: [![Imgur](https://live.staticflickr.com/65535/51393119912_73e6eddd54_b.jpg "Trickle down inconsistencies highlighted") ](https://www.flickr.com/photos/68782016@N08/51393119912/) 🤪 So does having extra money cause one to spend or save? 🤪 Note, Sam, this incoherence is conservative thought and practice defined: … to incentivize the _wealthy_, one must give them money … to incentivize all others, money should be taken away [https://www.investopedia.com/terms/t/trickledowntheory.asp](https://www.investopedia.com/terms/t/trickledowntheory.asp) ---
**Author:** ![JohnT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnt/32/15048_2.png) [@JohnT](https://boards.straightdope.com/u/JohnT)\ **Post date:** [August 22, 2021, 5:05am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1015 "2021-08-22T05:05:30Z")
Another problem with the Laffer curve in practice, is that it only measures the impact it has on government revenue. If you are a plutocrat getting more money every time taxes are cut regardless of where you are on the curve, and you believe in a malignant philosophy which states ‘the worst thing you can hear is “I’m from the government and I’m here to help”’, what do you care about the impact your lobbied-for tax cuts have on government revenue? ---
**Author:** ![JohnT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnt/32/15048_2.png) [@JohnT](https://boards.straightdope.com/u/JohnT)\ **Post date:** [August 22, 2021, 6:51am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1016 "2021-08-22T06:51:14Z")
What is the individual cost of this madness? Sam mentions some gadgets which somehow resulted because of trickle-down economics (TDE), but he hasn’t really explained that TDE was necessary for any of these things, especially given Western civilization’s rather impressive track record on creating technical shit, especially from 1455-onward. In fact, we can safely say that a non TDE world gets us to 1980s levels of civilization, which isn’t bad. Hell, we had dial-up back then. But I digress. What has TDE cost _us_, the individual? See, this is the one thing you don’t have to worry about, Sam, because you don’t live in a country dumb enough to enact these ideas across the entire societal spectrum. Tragically, however, I do. Let’s look at this graphic again: [![Imgur](https://live.staticflickr.com/65535/50993141016_fdf56ffba2_b.jpg "1609611178222") ](https://www.flickr.com/photos/68782016@N08/50993141016/) I posted it upthread, but want to reintroduce it to this discussion. This graph shows the disconnect between productivity growth and wage growth of production workers which started in 1975 and accelerated in 1981. And before I get accused of posting Lefty cites, here is the Heritage Foundation with a similar graph showing the same relationship: [![Imgur](https://live.staticflickr.com/65535/51393227007_89c9ce654f_z.jpg "Heritage Income") ](https://www.flickr.com/photos/68782016@N08/51393227007/) (We’ll go into “Total Compensation” and what an anti-worker crock that concept is later.) OK, so there is a disconnect between productivity growth and wage growth, one which didn’t exist before Nixon and was greatly boosted by Reagan. Much of this is due to the financialization of America, the process beginning in the mid 1970s of turning ownership into streams of revenue. Using junk bonds is an example of the financialization of America. The inability to buy a DVD, requiring us to stream movies we once could own is another. Student loans, an especially pernicious form of the concept. Derivatives. RMBS’s. Microsoft going from Office CD’s to Office 365. The list goes on. But why does this matter? The Rand Corporation looked at the above gap and decided to commission a study, released in August 2020, which did nothing but measure the economic impact of this change. on the various class levels here in America. They did not spend time exploring why this had happened, they just wanted to know the financial impact. This 69 page report (found below) breaks down the impact by income percentile, race, gender, state, and more. There are well over 100 different tables, and I chose the most comprehensive for this post: [![Imgur](https://live.staticflickr.com/65535/51394269043_925a5af977.jpg "Rand") ](https://www.flickr.com/photos/68782016@N08/51394269043/) Here’s how to read this chart, looking at line 2 (MEDIAN): _In 1975, the median individual (he/him) earned the equivalent of $42,000 in 2018 dollars. In 1979, the same. In 1989 his income increased $1k to $43k (but I thought the 80s were unprecedented prosperity? But I digress again…). By 2000, $47k, a dip during the Bush years, and in 2018, this person made $50,000…. $8,000 more than they were making in 1975._ _Had his income increased the same as it did ala 1945-1974 (“Counterfactual”), his income would be $92,000._ _Therefore, the median individual income grew only 16.0% as it would have under 1945-1974 growth rates._ Now let’s look at the 99% (last line): _In 1975, the average 1%er (TOP 1% MEAN) took home $289k equivalent. $292k in 1979, $467k by the first year of the Bush1 admin, more than doubling in the 1990s to $1.1M/yr, ending up at $1.384m in 2018._ _Had their income increased the same as 1945-1974, they would be earning $630,000_ _Therefore, the average 1%er grew their income at a rate 3.211x more than they would have had we kept to 1945-1974 rates._ Time Magazine has an excellent write-up on the financial catastrophe your economic ideas have had on America. Some quotes: > [@](#): > > the RAND report brings the inequality price tag directly home by denominating it in dollars—not just the aggregate $50 trillion figure, but in granular demographic detail. For example, are you a typical Black man earning $35,000 a year? You are being paid at least $26,000 a year _less_ than you would have had income distributions held constant. Are you a college-educated, prime-aged, full-time worker earning $72,000? Depending on the inflation index used (PCE or CPI, respectively), rising inequality is costing you between $48,000 and $63,000 a year. But whatever your race, gender, educational attainment, urbanicity, or income, the data show, if you earn below the 90th percentile, the relentlessly upward redistribution of income since 1975 is coming out of your pocket. > > Price and Edwards look at real taxable income from 1975 to 2018. They then compare actual income distributions in 2018 to a counterfactual that assumes incomes had continued to keep pace with growth in per capita Gross Domestic Product (GDP)—a 118% increase over the 1975 income numbers. Whether measuring inflation using the more conservative Personal Consumption Expenditures Price Index (PCE) or the more commonly cited Consumer Price Index for all Urban Consumers (CPI-U-RS), the results are striking. > > On average, extreme inequality is costing the median income full-time worker about $42,000 a year. Adjusted for inflation using the CPI, the numbers are even worse: half of all full-time workers (those at or below the median income of $50,000 a year) now earn _less than half_ what they would have had incomes across the distribution continued to keep pace with economic growth. And that’s per worker, not per household. At both the 25th and 50th percentiles, households comprised of a married couple with one full-time worker earned thousands of dollars less in 2018 dollars than a comparable household in 1975—and $50,000 and $66,000 less respectively than if inequality had held constant—a predicament compounded by the rising costs of maintaining a dignified middle-class life. According to Oren Cass, executive director of the conservative think tank [American Compass](https://americancompass.org/), the median male worker needed 30 weeks of income in 1985 to pay for housing, healthcare, transportation, and education for his family. By 2018, that “[Cost of Thriving Index](https://americanaffairsjournal.org/2020/02/the-cost-of-thriving/)” had increased to 53 weeks (more weeks than in an actual year). But the counterfactual reveals an even starker picture: In 2018, the combined income of married households with _two_ full-time workers was barely more than what the income of a single-earner household would have earned had inequality held constant. It’s now 2021 and it’s worse. Federal Reserve policy since Jimmy Carter has done nothing but exaggerate this problem, one which wasn’t slowed by the Democratic administrations of Clinton or Obama (so don’t give them a pass on this either) who themselves accepted the ideological framework of modern conservative economics, all driven by that laughably simple Laffer curve. Sam, this “trickle down” you love has represented a $50,000,000,000, $50 _trillion_, transfer of wealth from the middle class and lower to the top 10% since 1975. From me. From all the other Americans on this Board. But not from you, let us never, ever forget this _fact_, Sam, as you pitch for bad ideas which you never have to suffer under. To be quite frank, I am perfectly willing to give up Itunes and ABS brakes for $40k more a year. In fact, I’m pretty damned confident that these things would exist even if it weren’t for that fucker, Reagan. > **[The Top 1% of Americans Have Taken $50 Trillion From the Bottom 90%—And...](https://time.com/5888024/50-trillion-income-inequality-america/)** > > A report shows that a $50 trillion redistribution of income to benefit the richest has made America less healthy, resilient, and secure [https://www.rand.org/pubs/working\_papers/WRA516-1.html](https://www.rand.org/pubs/working_papers/WRA516-1.html) ---
**Author:** ![IvoryTowerDenizen](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ivorytowerdenizen/32/17937_2.png) [@IvoryTowerDenizen](https://boards.straightdope.com/u/IvoryTowerDenizen)\ **Post date:** [August 22, 2021, 11:38am UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1017 "2021-08-22T11:38:15Z")
@JohnT, that was a thing of beauty. Can we do an analysis of the changes Reagan made to federal financial aid and how it impacted opportunities for low income students to access higher ed and the crushing student debt problem, and it’s impact on personal wealth? ---
**Author:** ![RitterSport](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/rittersport/32/6326_2.png) [@RitterSport](https://boards.straightdope.com/u/RitterSport)\ **Post date:** [August 22, 2021, 12:11pm UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1018 "2021-08-22T12:11:51Z")
First, @JohnT, wow! Nicely done. > [@running\_coach](#): > > Supply side is where business is given tax breaks, reduced regulations and other incentives to increase production while leaving the consumer base without the extra money to buy the products. > [@Sam\_Stone](#): > > ‘Supply side’ isn’t about ‘the rich’. It’s about removing barriers to wealth creation through business, and it applies equally to your neighbor the landscaper and your local corner restaurant as it does Jeff Bezos. @Sam_Stone, man, your reading comprehension blows. @running_coach said nothing about Supply Side Economics being about the rich. He referenced the rich in the Trickle-Down part of his post. ---
**Author:** ![running\_coach](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/running_coach/32/15836_2.png) [@running\_coach](https://boards.straightdope.com/u/running_coach)\ **Post date:** [August 22, 2021, 12:13pm UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1019 "2021-08-22T12:13:17Z")
> [@IvoryTowerDenizen](#): > > @JohnT, that was a thing of beauty. - Second that. ---
**Author:** ![Cervaise](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cervaise/32/16693_2.png) [@Cervaise](https://boards.straightdope.com/u/Cervaise)\ **Post date:** [August 22, 2021, 12:46pm UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1020 "2021-08-22T12:46:42Z")
Third. I look forward to Sam tying himself into knots trying to ignore it without looking like he’s ignoring it. ---
**Author:** ![JohnT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnt/32/15048_2.png) [@JohnT](https://boards.straightdope.com/u/JohnT)\ **Post date:** [August 22, 2021, 1:20pm UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1021 "2021-08-22T13:20:56Z")
> [@JohnT](#): > > (We’ll go into “Total Compensation” and what an anti-worker crock that concept is later.) Shit, quickly: One of the conservative arguments to the productivity/wage graph is, they claim, that it only captures hourly compensation and doesn’t account for the rich diversity of benefits offered by our munificent employers. The Heritage Foundation calculated this and built the handy graphic below (also shown above): [![Imgur](https://live.staticflickr.com/65535/51393227007_89c9ce654f_z.jpg "Heritage Income") ](https://www.flickr.com/photos/68782016@N08/51393227007/) Let’s talk about how silly that argument is: 1. The gap is 107%. Even with 30% benefits added on, we are still down 77%. AS SHOWN ON THEIR OWN DECEPTIVE\* GRAPHIC! 🤦‍♂️ 2. The “growth” in benefits argument is a crock, the increase in benefits seen above entirely supported by the increase in the cost of health insurance. In fact, the _increase_ in health care “benefits” masks the _decreasing_ per employee contributions companies are making to retirement plans via the 401(k). And here’s how _that_ little con works. _You work at BigCorp for $60k/year. BigCorp pays 75% of your $500/month health insurance policy, or $375/month. You pay the $125 remaining. All things being equal, your after-insurance cash income is $58,500 ($60k - ($125x12) and your benefits income is $4,500 ($375x12), for a post out-of-pocket insurance cost of “Total Compensation” of $63,000._ _InsureCo meets with BigCorp execs, says “We have to raise the price of insurance by $200/month.” Your insurance is now $700. BigCorp says “Hey, don’t worry, we’ll still cover 75%!”_ Amount BigCorp pays: $525, up $150/mth from $375. Amount you pay: $175/mth, up $50/mth from $125. _Your cash income drops to $57,900, because you now pay $50/mth more in insurance costs. However, your “benefit income” increases by $1,800 to $6,300/year ($525x12), meaning your “Total Compensation” post-out-of-pocket-insurance is $64,200._ _You take home $600 less. Your “Total Compensation”, however, increases by $1,200 solely because of a rise in insurance rates which caused you and BigCorp to spend more on InsureCo’s insurance._ See what happens when you use a Total Compensation calculation like the Heritage guys above? Companies can literally charge you and your employers more for benefits, you get less take home pay, and yet that can be considered a “raise”. Bullshit. Here’s some Econ 101, Sam: Cash is King. This is why Total Compensation is a complete fuckery, mean to confuse those who don’t want to do the (slightly) detailed math. Or read the chart, like the one above which is presented as a _defense_ of this concept while still showing a 77% gap. They literally, Sam, expect you to hear what you want to hear and not see what’s directly in front of your own eyes. This guys whole argument still has a 77% gap, but he still tries to convince us that what we’re seeing IN HIS CHART is not what we’re seeing. C’mon. You’re better than this blatant intellectual dishonesty. You’re better than Reaganomics. Cite: > **[Productivity and Compensation: Growing Together](https://www.heritage.org/jobs-and-labor/report/productivity-and-compensation-growing-together)** > > President John F. Kennedy believed that “a rising tide lifts all boats,” but many question if that remains true today. They point to data showing that productivity has risen sharply since the 1970s while wages have stagnated. They conclude that... \*How the graph is dishonest, let me count the ways: 1. You see no baseline prior to 1974. This wouldn’t matter, except for the addition of the “benefits” variable. How did those behave in 1945-1974 is kept hidden from us. 2. Note that they literally placed the top value at 100% and showed incomes declining 7%. They could have just as easily adjusted for 2012=100, and have the top value be 107%. This is a bit deceiving because most people skimming this chart will think “oh, productivity doubled” when, in fact, compared to wages it rose 107% not 100%. I would also like to note that the “Goods Produced vs Goods Consumed” argument suffers from a fatal flaw when it states: “To discern whether compensation has kept pace with worker productivity, economists use the prices of the goods or services that employees produce.” The assumption here is that all revenues and profits are generated from operating activities. Since 1975, this is increasingly false for almost all Fortune 500 businesses, which see growing, significant revenues via the income statement lines “gain (loss) due to financial activities”, “extraordinary items”, and the like. ---
**Author:** ![JohnT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnt/32/15048_2.png) [@JohnT](https://boards.straightdope.com/u/JohnT)\ **Post date:** [August 22, 2021, 1:47pm UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1022 "2021-08-22T13:47:04Z")
Oh, and thank you all for the kind words. ---
**Author:** ![JohnT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnt/32/15048_2.png) [@JohnT](https://boards.straightdope.com/u/JohnT)\ **Post date:** [August 22, 2021, 2:08pm UTC](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633/1023 "2021-08-22T14:08:07Z")
> [@IvoryTowerDenizen](#): > > Can we do an analysis of the changes Reagan made to federal financial aid and how it impacted opportunities for low income students to access higher ed and the crushing student debt problem, and it’s impact on personal wealth? Not really my topic, but from what I see, it’s either GHWB or Clinton who initiated the policy change which made student loans _very_ attractive to private lenders in 1992, 1993: [![Imgur](https://live.staticflickr.com/65535/51393926312_bf6c1b3942_z.jpg "Student Debt Growth 1963-2010") ](https://www.flickr.com/photos/68782016@N08/51393926312/) To be fair, there’s a whole host of bad-faith actors involved in this, from US News and World Report to colleges pushing their branding via increasing their tuition cost (makes them appear more valuable - “surely they wouldn’t be charging $65k/year if they weren’t worth it… right?”, to private equity firms willing to put trillions of debt on the back of 19 year-olds who are being trained to work in the Reaganomics-dominated income environment described above, to every Presidential administration since Johnson who allowed this problem to fester and metastasize into yet another capitalist cancer on OUR lives. Cite for chart: [https://www.thirdway.org/report/student-loans-and-graduation-from-american-universities](https://www.thirdway.org/report/student-loans-and-graduation-from-american-universities) [Previous page](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633.md?page=50) [Next page](https://boards.straightdope.com/t/sam-stone-believes-trumps-tweets/922633.md?page=52)