# Where does the Left think economic growth comes from? **URL:** \ **Category:** In My Humble Opinion\ **Created:** [November 28, 2017, 8:19pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975 "2017-11-28T20:19:01Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![enipla](https://avatars.discourse-cdn.com/v4/letter/e/54ee81/32.png) [@enipla](https://boards.straightdope.com/u/enipla)\ **Post date:** [December 1, 2017, 10:04pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/61 "2017-12-01T22:04:54Z")
> [@Shodan](#): > > Like I said, a distinction without a difference. The Left thinks the right thing is to spend the money, not invest it. So they want to take the money away from the rich and either spend it, or give it to the middle and lower classes to spend.That’s what I said - Obamacare imposed a legal mandate to spend money on health insurance. Because Obama believed that this was the right way for people to spend their money. > I have not made that claim, so I guess I will decline to do so. > No, of course not. If the bank thinks there will be customers, they will risk their money. If not, they won’t. That’s rather different from saying that businesses never need to borrow to expand, but can just use the money from existing revenue. > > [ol] > [li]This has nothing to do with the topic.[/li][li]See above.[/li][li]See number 3.[/li][/ol]Regards, > Shodan The topic is economic growth. And you don’t thing that 17% of our GDP has anything to do with it. OK. ---
**Author:** ![j666](https://avatars.discourse-cdn.com/v4/letter/j/9de0a6/32.png) [@j666](https://boards.straightdope.com/u/j666)\ **Post date:** [December 1, 2017, 11:04pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/62 "2017-12-01T23:04:47Z")
> [@Shodan](#): > > … Capital investment is driven by the expectation of a return on investment. Investors invest because they believe there are more customers. … That might assume more rational decision making that is common in economic matters. ---
**Author:** ![begbert2](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/begbert2/32/3357_2.png) [@begbert2](https://boards.straightdope.com/u/begbert2)\ **Post date:** [December 2, 2017, 12:29am UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/63 "2017-12-02T00:29:13Z")
The claim that economic growth is constrained if businesses are unable to secure capital to grow is true - but this fact is only relevant if businesses are having a hard time finding capital. By all available measures (like interest rates), this is not currently the case. Therefore any right-winger who likes facts, truth, and reality would readily state that we do not currently need to hand money to companies and to the rich (who turn around and reinvest their surplus money in companies). There is no economic growth to be gained from pumping funds into a saturated system. The claim that economic growth is constrained if consumers are unable to buy any and everything they want is also true - and is only relevant if there are any members of the populace that are not living in absolute luxury. Most metrics conclude that there are at least a handful of people who would buy more things if they had more money. Thus left-wingers can comfortably state that pumping money into the financially parched segments of society would in fact increase effective demand, allowing companies to use their currently available resources to expand their production to meet that demand and thus grow the economy. The right wing position is reasonable in some theoretically possible situations. These situations do not exist in America today. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [December 2, 2017, 1:28am UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/64 "2017-12-02T01:28:58Z")
> [@Shodan](#): > > Like I said, a distinction without a difference. The Left thinks the right thing is to spend the money, not invest it. So they want to take the money away from the rich and either spend it, or give it to the middle and lower classes to spend.That’s what I said - Obamacare imposed a legal mandate to spend money on health insurance. Because Obama believed that this was the right way for people to spend their money. > I have not made that claim, so I guess I will decline to do so. The Left says that when there is a consumption shortfall, money should be directed to those who consume. The Right seems to say that directing money to those who invest is always good. If there is ample investment capital already - which you doen’t deny – then adding to the investment capital is not good. It drives up stock prices, for instance, and might cause investors to invest in nonproductive investments, like we saw during the Bubble. Government spending on infrastructure and research is an investment also. It, unlike private investment, is woefully underfunded. So I trust you are in favor of this. When you say > [@](#): > > The Left thinks the middle class spends money on the right things, and that the rich don’t spend money on the right things, or in the right way. Therefore the Left wants to transfer income from the rich to the middle class, and the poor. I think there is a clear implication that the Left micromanages middle class spending, or wants to. Here is your first post > [@](#): > > The Left thinks economic growth comes from money being spent on the right things, and in the right way. “On the right things” definitely implies that the Left cares what people spend their money on. Now, if you can’t tell the difference between spending on items which reduce inventories and therefore require more production from spending on stock which does none of this, that is your problem, not ours. You, like so many on the right, pretend that the left is really aching for a demand economy, which is bullshit. Economic growth coming from increased consumption - which drives increased production - should hardly be a controversial position. Yet it does not increase inequality enough, and so the right hates it. This policy does make the rich richer also - like during the bubble - but clearly not fast enough for the likes of some. ---
**Author:** ![Ravenman](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ravenman/32/2929_2.png) [@Ravenman](https://boards.straightdope.com/u/Ravenman)\ **Post date:** [December 2, 2017, 2:28am UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/65 "2017-12-02T02:28:08Z")
> [@Shodan](#): > > I don’t think this is correct either. “Consumption is better than investment” is a value judgment, just a different one. I’m really not trying to pick a fight or nitpick your statement, but your original statement was flippant. It could be interpreted several ways, and my immediate interpretation was “liberals hate it when rich people buy yachts.” If that isn’t what you mean, then you seem to be saying that investment is more stimulative than consumption, or that the two are equally stimulative; since you are expressing opposition to the “liberal” idea that consumption is more stimulative than investment. ---
**Author:** ![j666](https://avatars.discourse-cdn.com/v4/letter/j/9de0a6/32.png) [@j666](https://boards.straightdope.com/u/j666)\ **Post date:** [December 2, 2017, 2:27pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/66 "2017-12-02T14:27:15Z")
Repeatedly saying, “I disagree” does not make an argument wrong. Healthy economies are driven by consumption of goods and services. ---
**Author:** ![RTFirefly](https://avatars.discourse-cdn.com/v4/letter/r/c77e96/32.png) [@RTFirefly](https://boards.straightdope.com/u/RTFirefly)\ **Post date:** [December 2, 2017, 11:05pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/67 "2017-12-02T23:05:57Z")
> [@Shodan](#): > > Like I said, a distinction without a difference. The Left thinks the right thing is to spend the money, not invest it. These are two sides to the same coin, in a healthy economy. What’s the point of investing, if nobody’s going to spend the money on whatever your investment produces for sale? Now suppose people are already spending as much as they can afford to spend (except for the rich who, if they’re rich enough, just plain run out of toys worth buying), but there’s still this enormous pile of investment capital lying around unused. Sure, lefty though I am, I’d like to see it invested. But under those circumstances, _why would anyone in their right mind invest??_ That’s where we are today. (And we’ll be even further up that creek once the tax bill becomes law.) That’s why left and right should agree that _the bottom 80% or so should have more money_, at the cost of part of that pile of investment capital, so that the demand for goods and services would increase, resulting in decent investment opportunities for the _rest_ of that pile. (How do we get more money to the bottom 80%? Lots of possible ways. Raise the minimum wage, require paid vacation and sick leave, require that the bottom 80% or so get overtime after 40 hours, etc. Lots of ways to do this that reward work better, rather than simply handing out money - though that’s an option too, I suppose.) ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [December 3, 2017, 1:39pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/68 "2017-12-03T13:39:19Z")
> [@RTFirefly](#): > > Now suppose people are already spending as much as they can afford to spend (except for the rich who, if they’re rich enough, just plain run out of toys worth buying), but there’s still this enormous pile of investment capital lying around unused. > > Sure, lefty though I am, I’d like to see it invested. But under those circumstances, _why would anyone in their right mind invest??_ > > That’s where we are today. (And we’ll be even further up that creek once the tax bill becomes law.) Yet we continue to produce more goods and services, to the point where it’s hard to find enough people to produce them. That doesn’t sound like “people are already spending as much as they can afford to spend” is where we are. ---
**Author:** ![Robot\_Arm](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/robot_arm/32/18280_2.png) [@Robot\_Arm](https://boards.straightdope.com/u/Robot_Arm)\ **Post date:** [December 3, 2017, 1:49pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/69 "2017-12-03T13:49:05Z")
> [@Ruken](#): > > Yet we continue to produce more goods and services, to the point where it’s hard to find enough people to produce them. That doesn’t sound like “people are already spending as much as they can afford to spend” is where we are. Well, cars, televisions, refrigerators, etc. don’t last forever. Old ones will wear out and have to be replaced. And there will be more demand for those things as more people rise to an economic level where they can afford them plus all the old, worn-out ones being replaced. ---
**Author:** ![RTFirefly](https://avatars.discourse-cdn.com/v4/letter/r/c77e96/32.png) [@RTFirefly](https://boards.straightdope.com/u/RTFirefly)\ **Post date:** [December 3, 2017, 6:55pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/70 "2017-12-03T18:55:31Z")
> [@Ruken](#): > > Yet we continue to produce more goods and services, to the point where it’s hard to find enough people to produce them. Yeah, you see those articles in the news about how hard it is to find workers. “We’ve tried everything,” they say, and list all sorts of things they’ve done to beat the bushes. Usually absent from those articles is any mention of paying more money. So the definition of ‘hard’ they’re using is kinda, well, _soft._ > [@](#): > > That doesn’t sound like “people are already spending as much as they can afford to spend” is where we are. Business Insider: [Consumer-debt levels are now well above those seen before the Great Recession.](http://www.businessinsider.com/americans-are-more-indebted-than-ever-raising-economic-risks-2017-10) IOW, sounds like it to me. ---
**Author:** ![enipla](https://avatars.discourse-cdn.com/v4/letter/e/54ee81/32.png) [@enipla](https://boards.straightdope.com/u/enipla)\ **Post date:** [December 3, 2017, 9:16pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/71 "2017-12-03T21:16:14Z")
> [@Ruken](#): > > Yet we continue to produce more goods and services, to the point where it’s hard to find enough people to produce them. That doesn’t sound like “people are already spending as much as they can afford to spend” is where we are. What company is making more goods and services that they can sell and is having a hard time finding people to produce said goods and services. :smack::dubious::smack: ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [December 3, 2017, 9:58pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/72 "2017-12-03T21:58:19Z")
> [@enipla](#): > > What company is making more goods and services that they can sell and is having a hard time finding people to produce said goods and services. :smack::dubious::smack: Companies complain about this all the time. As mentioned, one reason is that they are not paying enough (capitalism is great unless it involves paying scarce workers more.) Another in the IT game is that companies want to hire people with special skills, now in demand, but don’t want to do any training. So they complain that schools aren’t turning out grads with the particular skills they need right now. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [December 3, 2017, 9:59pm UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/73 "2017-12-03T21:59:26Z")
> [@Ruken](#): > > Yet we continue to produce more goods and services, to the point where it’s hard to find enough people to produce them. That doesn’t sound like “people are already spending as much as they can afford to spend” is where we are. We are obviously not producing enough goods and services to raise the GDP as much as we want to, and as much as it has risen in the past. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [December 4, 2017, 1:01am UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/74 "2017-12-04T01:01:14Z")
> [@RTFirefly](#): > > Business Insider: [Consumer-debt levels are now well above those seen before the Great Recession.](http://www.businessinsider.com/americans-are-more-indebted-than-ever-raising-economic-risks-2017-10) IOW, sounds like it to me. Maybe\* they are spent out. The point is that the hypothesis that the bottom 80% having money to spend is what gives us growth is not consistent with having people spent out _and_ having growth, which was at 3.1% (seasonally adjusted annual) last quarter. So either people aren’t spent out or it’s something else\*\* that’s driving growth. \*Except that article is consistent with consumers simply feeling confident enough to take advantage of the cheap credit available. I know I’m finally feeling ok with the half-million dollar mortgage that I’d need to buy a house around here. And I’m not the only one feeling good, given the high Consumer Confidence Index. Of course people felt pretty good in early 2007 too.:smack: \*\*And you may already onto that something else. I can finance growth activities pretty darn cheaply these days with money I hope to have later. > [@RTFirefly](#): > > Yeah, you see those articles in the news about how hard it is to find workers. “We’ve tried everything,” they say, and list all sorts of things they’ve done to beat the bushes. > > Usually absent from those articles is any mention of paying more money. So the definition of ‘hard’ they’re using is kinda, well, _soft._ > [@enipla](#): > > What company is making more goods and services that they can sell and is having a hard time finding people to produce said goods and services. :smack::dubious::smack: > [@Voyager](#): > > Companies complain about this all the time. As mentioned, one reason is that they are not paying enough (capitalism is great unless it involves paying scarce workers more.) Another in the IT game is that companies want to hire people with special skills, now in demand, but don’t want to do any training. So they complain that schools aren’t turning out grads with the particular skills they need right now. All measures of unemployment are [down](https://www.bls.gov/news.release/empsit.t15.htm). The seasonally-adjusted total nonfarm job openings rate is the the highest it’s ever been since BLS started measuring it ([4.0%](https://fred.stlouisfed.org/series/JTSJOR#0)). And companies _are_ paying most people [more](https://www.frbsf.org/our-district/about/sf-fed-blog/wage-growth-good-news/), even if it’s masked by demographic changes, i.e. entrants and exits to and from the labor force. (Very simply, grandpa retiring and junior getting his first job masks anyone else getting a raise.) > [@Voyager](#): > > We are obviously not producing enough goods and services to raise the GDP as much as we want to, and as much as it has risen in the past. Which “we” 🙂 Our dear leader wants something like 4% growth. I don’t have much opinion on whether that’s desirable. But you need people and/or productivity for growth. I don’t see him doiing much to increase productivity. And without immigration the country has pretty darn low population growth. So good luck with that one, DJT. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [December 4, 2017, 1:46am UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/75 "2017-12-04T01:46:01Z")
[quote=“Ruken, post:74, topic:802975”] \*Except that article is consistent with consumers simply feeling confident enough to take advantage of the cheap credit available. I know I’m finally feeling ok with the half-million dollar mortgage that I’d need to buy a house around here. And I’m not the only one feeling good, given the high Consumer Confidence Index. Of course people felt pretty good in early 2007 too.:smack: $500K? You’re lucky you live in a cheap housing market. > [@](#): > > All measures of unemployment are [down](https://www.bls.gov/news.release/empsit.t15.htm). The seasonally-adjusted total nonfarm job openings rate is the the highest it’s ever been since BLS started measuring it ([4.0%](https://fred.stlouisfed.org/series/JTSJOR#0)). And companies _are_ paying most people [more](https://www.frbsf.org/our-district/about/sf-fed-blog/wage-growth-good-news/), even if it’s masked by demographic changes, i.e. entrants and exits to and from the labor force. (Very simply, grandpa retiring and junior getting his first job masks anyone else getting a raise.) Low unemployment is not contradictory to the statement that businesses claim they can’t find qualified workers. In fact if unemployment down and a company’s offers still assume that applicants will take anything because jobs are scarce, that company will have trouble hiring. And of course blame the workers, not themselves. Wages have finally started going up, but are pretty sticky still. > [@](#): > > Which “we” 🙂 Our dear leader wants something like 4% growth. I don’t have much opinion on whether that’s desirable. But you need people and/or productivity for growth. I don’t see him doing much to increase productivity. And without immigration the country has pretty darn low population growth. So good luck with that one, DJT. Well, that’s why “we” need this tax cut for the rich, isn’t it? Amazing how the economy suddenly improved last January. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [December 4, 2017, 2:27am UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/76 "2017-12-04T02:27:53Z")
Wages are not “finally” going up. They have been and are still going up. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [December 4, 2017, 2:48am UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/77 "2017-12-04T02:48:56Z")
> [@Voyager](#): > > $500K? You’re lucky you live in a cheap housing market. The only one stopping you from checking actual housing prices before posting is you. ---
**Author:** ![jkirkman](https://avatars.discourse-cdn.com/v4/letter/j/ac8455/32.png) [@jkirkman](https://boards.straightdope.com/u/jkirkman)\ **Post date:** [December 4, 2017, 5:44am UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/78 "2017-12-04T05:44:34Z")
I can’t afford health care insurance next year at all. So, no meds, at all. Not being completely insane, instead of going kill-crazy, I will choose to curl up in a corner and die. This is my life. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [December 4, 2017, 7:28am UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/79 "2017-12-04T07:28:53Z")
> [@Ruken](#): > > The only one stopping you from checking actual housing prices before posting is you. Whoosh. I live in the Bay Area. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [December 4, 2017, 11:58am UTC](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975/80 "2017-12-04T11:58:28Z")
> [@Voyager](#): > > Whoosh. I live in the Bay Area. Which has housing that can be purchased with 20% down and a $500k mortgage. [Previous page](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975.md?page=3) [Next page](https://boards.straightdope.com/t/where-does-the-left-think-economic-growth-comes-from/802975.md?page=5)