Chilling Economic Report Getting Passed Around By CEOs

[P@triot]

We may never get a "pure" version of capitalism, but that system is by far the best and should remain as free as possible from intervention by central planners. Praxeology is not meant, like economics, to be perfect. Humans aren't perfect. But if we can understand this and protect the rights of everyone under a uniformed and equal standard of the law, we find the best possible economic system known to man.

What we have now is none of that. We have central planners constantly fucking with our money supplies, we have a government corrupt that picks favorites in almost every sector of the economy, and they are all above the law. That's why this corporatism has to implode.

So we can hopefully reclaim our human actions as free, while establishing a rule of law that protects the rights of all.

John Smith explained quite clearly why unfettered, unregulated capitalism ALWAYS collapses. He stated that capitalism only works in a carefully regulated environment--lest labor be relegated entirely to commodity status.

But I see your point in general. I would personally much prefer a system that rewards productivity well, and rewards ONLY productivity. The American economy is extremely far from that ideal, though. Too many Americans are rewarded only because they have the ability and means to demand it.

All evidence to the contrary. Steve Jobs was given up at birth and was adopted by an average, middle-class family. No wealth. No privilege. And Jobs did not even go to college (he attended a semester here and there over a period of a few years at different institutions). Yet, out of his own garage, he built an iconic empire which is now the most valuable company in U.S. history.

 

[TakeAStepBack]

It's the typical fallacy I tend to see. That capitalism is driven by greed. Because humans are greedy and generally will do whatever to get over on others. Then at the same time, humans need to regulate praxeology (or at least the omnipotent selected few central planners) because true free market laissez faire will collapse on iteself due to greedy, exploitative capitalists.

it's a really perplexing argument.

 

[Dont Taz Me Bro]

Of course it requires infinite sustained growth. That is what defines capitalism. Without economic growth, there is no profitability in investments. That's all that drives capitalism.

Capitalism

an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market

Growth is commanded by many variables. Capitalism can survive just fine in relatively flat growth curves. Profitability can be extremely limited, and does not require inifinite sustained growth to remain in existence.

The fact is, capitalism itself creates growth (as one variable). Because it incites innovation, ingenuity, invention, etc...all which lead to better ways of production and living standard which in turn, leads to growth.

I gues i really don't understand what you're arguing here.

I don't think he does either.

 

[TakeAStepBack]

I presumed the poster was arguing against the current US system, but viewed it as capitalism. That's why I kept trying to correct. i think a better grasp has been attained (i hope).

 

[arKangel]

That "plan" is what is happening in Greece right now.

Oh and you CAN forgive debt, it's called "Debt Jubilee". Look that up.

You CAN commit mureder. You CAN commit rape. Doesn't mean either are a good idea. Just because you CAN do something, doesn't mean you SHOULD do something.

Why would anyone give the U.S. credit ever again if they operate under the assumption they can just not pay it back if they don't feel like it? That's stupid on a level that is incomprehensible.

OK,
The problem is that the U.S. has "borrowed" so much that they can't pay back...
But you are worried that if it isn't payed back, then the U.S. won't be able to "borrow" it's way back into the same predicament?

TASB:

I'm only pointing out that:

(1) The nature of capitalism encourages anything that produces ROI--including Ponzi schemes though federal fiscal policy. (In the end, who do you think ended up with that $16 trillion that the federal government "overspent?" Nobody seems to consider that.)

(2) Another aspect of the ONLY motivation behind capitalism--profit--is that labor will be underpaid so that more money can end up in the hands of capitalists; ergo, the increase in wealth concentration in the hands of a few since Reagan. Do you think this economic system is sustainable without artificial "stimulus?"

Capitalists have ONE god to answer to--PROFIT. They will do ANYTHING to satisfy their hunger for more profit--because money means control.

Arguing about "communism vs. capitalism" is a red herring.

This is about usury.
Don't feed the parasites.

Real Solutions:
End the FED
End the wars for the international banksters.

 

[4Horsemen]

Workers are already following companies out of the country. It can't happen fast enough. The US needs to wallow.

It took Obama, Pelosi, and Reid only 2 years to completely devastate the world's premier superpower.

NOt exactly. think of Obama's Regime as the last hunks of loose wet drippy shit being piled up into a broken toilet(US Government), and it's now beginning to flow over the sides of the broken toilet and onto the floor, totally stinking up the restroom to the point where nobody can stand it, not even the decades of shitters that knew the toilet was broken decades ago. So now in 2012, America's apathy for a strong country is an afterthought,, since the masses are literally worn out with all the decades of bullshit these political criminals have been forcing onto them.

America is like Apollo Creed vs. Ivan Drago now. "If he dies he dies..."

[ame=http://www.youtube.com/watch?v=7SEhIkMhNQU]Rocky IV[1985]death of apollo creed vs Ivan Drago - YouTube[/ame]

[ame=http://www.youtube.com/watch?v=BDgcc5Sif3k]If he dies, he dies - YouTube[/ame]

 

[neoliberal]

Hello. I'm new here but I would like to throw my $.02 in if I may. Many in the past 30-40 years have began to subscribe to what is know as the Austrian economic model. Whether it derives from Friedman, Greenspan or from the psuedo science fiction writer Ayn Rand or perhaps a mixture, i do not know. However, these ideas are co-opted by another political movement know as Libertarians. This being a uniquiely western phenomenon as most the rest of the world associate the term Libertarian with it's more traditional definition Social Libertarian or Anarchism.
While I will admit I have not went into great detail studying what I consider to be a dead-end model of political achievement, from what i have learned from my research into the subject led me to this conclusion.
The Austrian School of Economics is a tiny group of libertarians at war with mainstream economics. They reject even the scientific method that mainstream economists use, preferring to use instead a pre-scientific approach that shuns real-world data and is based purely on logical assumptions. But this is the very method that thousands of religions use when they argue their opposing beliefs, and the fact that the world has thousands of religions proves the fallibility of this approach. Academia has generally ignored the Austrian School, and the only reason it continues to exist is because it is financed by wealthy business donors on the far right. The movement does not exist on its own scholarly merits.

A rather simplified example, but I believe you will find it to be quite accurate: Austrians economists would have you believe that demand for goods and services is infinite. That if we merely encourage the “creators” of wealth then they will hire more people and “create” more jobs and more wealth. Nothing could be further from the truth. Here’s a little story to tell why.

Let’s suppose that I am one of the right’s “job creators.” I have a factory that produces widgets. Widgets are necessary in everyday life, but they have a limited lifespan. Ideally, they would be replaced every two months, but in a pinch they can last up to a year. During the Clinton Administration, my factory was fully utilized and I was producing 250,000 widgets a month and selling all of them. There were three other widget factories in the country as well, but mine was the biggest and the most productive. During the Shrub’s first term, I noticed a slight drop off in my sales and my warehouse had a small surplus of widgets. Not enough to be a problem, in fact I saw it as a good thing because now my customers were not unhappy about my missing the occasional delivery date. Oh, and I was still making good money.

When the Shrub was elected for a second term, I noticed a problem immediately. My warehouse was filling up. I laid off my third shift. Two of my competitors closed their doors and the third one outsourced to China. My widgets still outsold those from China because they work better and last longer, and I’ve cut my prices to match the imports. For a while things looked up and my warehouse started to empty out, but it didn’t last. When my inventory started to increase again I laid off my second shift. Then came September of 2008 and the demand for my widgets dropped through the floor. The Chinese widgets were primarily selling in Europe but they cut their production so much that they were no longer a factor. I cut my remaining staff by half and was extremely happy I owned my facilities outright. Because of that, I’m still making money.

Now Romney wants to lower my taxes and give me more money: great! It won’t cause me to build more widgets. My warehouse still has a three-month buffer and that is where I’m keeping it with a ¾ staffed single shift. If I hire more people and build more widgets, I won’t be able to sell them and they’ll just gather dust in my warehouse. That is the fallacy of the economic plan.
Now you may say, but if we had PURE capitalism this would now be the case. Unfortunately we live in the real world. If one desires a real world example of the failure of Austrian economics, look at the period in American history they like to hold up as a shining example, the 1870s. While a boom time for Industialists and their ilk it was hardly anything utopian for the great masses who suffered. High rates of unemployment, unregulated business interests led to teriibly destructive monopolies, atricious working conditions, hours, pay, child labor, ect.ect. while this could be taken as a great benefit for the few, today's working persons would not desire to return to such a time.

 

[Rozman]

We can fix it all by taking away all the wealth from the rich people.

 

[FA_Q2]

Hello. I'm new here but I would like to throw my $.02 in if I may. Many in the past 30-40 years have began to subscribe to what is know as the Austrian economic model. Whether it derives from Friedman, Greenspan or from the psuedo science fiction writer Ayn Rand or perhaps a mixture, i do not know. However, these ideas are co-opted by another political movement know as Libertarians. This being a uniquiely western phenomenon as most the rest of the world associate the term Libertarian with it's more traditional definition Social Libertarian or Anarchism.
While I will admit I have not went into great detail studying what I consider to be a dead-end model of political achievement, from what i have learned from my research into the subject led me to this conclusion.
The Austrian School of Economics is a tiny group of libertarians at war with mainstream economics. They reject even the scientific method that mainstream economists use, preferring to use instead a pre-scientific approach that shuns real-world data and is based purely on logical assumptions. But this is the very method that thousands of religions use when they argue their opposing beliefs, and the fact that the world has thousands of religions proves the fallibility of this approach. Academia has generally ignored the Austrian School, and the only reason it continues to exist is because it is financed by wealthy business donors on the far right. The movement does not exist on its own scholarly merits.

A rather simplified example, but I believe you will find it to be quite accurate: Austrians economists would have you believe that demand for goods and services is infinite. That if we merely encourage the “creators” of wealth then they will hire more people and “create” more jobs and more wealth. Nothing could be further from the truth. Here’s a little story to tell why.

Let’s suppose that I am one of the right’s “job creators.” I have a factory that produces widgets. Widgets are necessary in everyday life, but they have a limited lifespan. Ideally, they would be replaced every two months, but in a pinch they can last up to a year. During the Clinton Administration, my factory was fully utilized and I was producing 250,000 widgets a month and selling all of them. There were three other widget factories in the country as well, but mine was the biggest and the most productive. During the Shrub’s first term, I noticed a slight drop off in my sales and my warehouse had a small surplus of widgets. Not enough to be a problem, in fact I saw it as a good thing because now my customers were not unhappy about my missing the occasional delivery date. Oh, and I was still making good money.

When the Shrub was elected for a second term, I noticed a problem immediately. My warehouse was filling up. I laid off my third shift. Two of my competitors closed their doors and the third one outsourced to China. My widgets still outsold those from China because they work better and last longer, and I’ve cut my prices to match the imports. For a while things looked up and my warehouse started to empty out, but it didn’t last. When my inventory started to increase again I laid off my second shift. Then came September of 2008 and the demand for my widgets dropped through the floor. The Chinese widgets were primarily selling in Europe but they cut their production so much that they were no longer a factor. I cut my remaining staff by half and was extremely happy I owned my facilities outright. Because of that, I’m still making money.

Now Romney wants to lower my taxes and give me more money: great! It won’t cause me to build more widgets. My warehouse still has a three-month buffer and that is where I’m keeping it with a ¾ staffed single shift. If I hire more people and build more widgets, I won’t be able to sell them and they’ll just gather dust in my warehouse. That is the fallacy of the economic plan.
Now you may say, but if we had PURE capitalism this would now be the case. Unfortunately we live in the real world. If one desires a real world example of the failure of Austrian economics, look at the period in American history they like to hold up as a shining example, the 1870s. While a boom time for Industialists and their ilk it was hardly anything utopian for the great masses who suffered. High rates of unemployment, unregulated business interests led to teriibly destructive monopolies, atricious working conditions, hours, pay, child labor, ect.ect. while this could be taken as a great benefit for the few, today's working persons would not desire to return to such a time.

This is an extremely 2 dimensional look at the situation though and you are simplifying it to the point that it no longer applies to the situation at hand. A few glaring holes that pop out immediately are the fact that your widgets do not exist in a vacuum and that profits are not merely a reflection of volume sold but include the profit per unit as well.

What I mean by this is that returning money to the job 'creator' as you called it does not assume that he will either stuff it in his mattress or he will invest it into producing more widgets. That is not the only options available to him at the time. He could open another factory that produces an entirely different product for example. No matter where the money ends up going, it is going SOMEWHERE. The contention is that the government can come in, take that money away and put in a better place. I find that rather laughable as I have seen the way the government spends money. The idea that the government is going to invest this cash in a better place that produces MORE wealth (essentially products) is misplaced at best. The government does create some things like roads but for the most part government functions are no better than draining wealth out of society. Some of that drain is required in order for society to function. We would not be very successful if there were no firemen to ensure that our production did not burn down but that does not mean increasing firemen's ranks creates more wealth when you already have a sufficient fire protection available.

Further, profits are not realized solely on numbers sold. If demand is going to drop and fewer widgets are sold then it is likely that prices of those widgets themselves are going to increase. By taking more of the end profits of widgets, those prices are going to increase, demand is going to drop, labor (as you cited) is going to get laid off and, at the end of the day, that rich guy is still rich. The problem is while we all thought HE was paying more it ends up coming out of our pockets when we go buy the widget. It is this fundamental flaw in most people's way of thinking that I could never understand. It is similar to the way we pull SS taxes. Instead of taxing the employee because that would make the voting populous angry, we made the employer match the tax paid. That way, the employer was paying that tax not the employee. Never mind that, at the end of the day, this actually means employee wages are going to either decrease OR the price of the product is going to increase. In the end, it was not the job 'creator' that was taxed that really ends up paying the lion's share of the price anyway.

Really, we are not talking about whether or not the job 'creators' money is going to ensure more widget factory workers are hired this year or not. What the heart of the issue is whether or not that money is going to be invested better by the individuals themselves or the government. Clearly, some portion of that is BETTER invested by the government because the government needs to supply certain services in order for a country to be prosperous. Most of us on the 'right' simply feel that we crossed that mark a LONG time ago and there is ample evidence to support this. Further, redistribution schemes are utter failures as they do not invest in anything at all. Those schemes rely on the idea that people who have not produced are somehow better at investing that money than those that have. DO NOT confuse this with social safety nets. That is another beast altogether and one of those necessities that deservers a thread of its own. I believe in basic safety nets but the government is no longer looking for those. Instead, it believes that it can FORCE income distribution by taking from the haves and giving to the have nots. Unfortunately, this type of action only INCREASES that which the rich have as they are quite adept at working within the system and decreases the standard of living for the recipients of such giveaways.

Lastly, I would like to touch on the idea that the left or anyone at all here is advocating for a Keynesian system. I hear people consistently demanding that such ideas are proven and what we need is more stimulus BUT that is NOT Keynesian. The centerpiece of such thought relies on the idea of government spending in a recession and recovering during the booms. That is NOT what we have been doing. Instead, we have been spurring economic growth through government spending during the bad times AND the good times. How many years has it been since the debt DECREASED? Decades. Even Keynesian economics is not so daft as to buy into the idea that this works long term. Such deficit spending is not supposed to be indefinite yet here we are and not a SINGLE politician is advocating for anything resembling paying off the deficit. The problem we now face is NOT that we should not be spending to spur growth but that we have ALREADY spent to spur said growth. We cannot indefinitely live in a fantasy economy. It will realign and the longer we wait to get there the worse the fall is going to be.

 

[4Horsemen]

We can fix it all by taking away all the wealth from the rich people.

And give it to who? a buncha ignorant negroes to buy up all the chicken? gtfoh!

 

[P@triot]

That "plan" is what is happening in Greece right now.

Oh and you CAN forgive debt, it's called "Debt Jubilee". Look that up.

You CAN commit mureder. You CAN commit rape. Doesn't mean either are a good idea. Just because you CAN do something, doesn't mean you SHOULD do something.

Why would anyone give the U.S. credit ever again if they operate under the assumption they can just not pay it back if they don't feel like it? That's stupid on a level that is incomprehensible.

OK,
The problem is that the U.S. has "borrowed" so much that they can't pay back...
But you are worried that if it isn't payed back, then the U.S. won't be able to "borrow" it's way back into the same predicament?

First of all, are you seriously telling me you don't think the United States would ever need credit again? Really?

Second, why exactly does it have to be "back into the same predicament"? You're telling me we can't pay off our debt like big boys and girls and then use credit responsibly and wisely in the future? I guarantee you if Congress were stacked with just Tea Party candidates it could and would be done.

 

[PaulS1950]

How do you pay back $16,400,000,000,000?
If you paid a billion dollars a year it would not pay the interest. For each percent of interest you would pay 164 billion dollars each year. If the US has really good credit and gets a very low rate we might pay only 246 billion dollars each year in INTEREST (1.5%). If you paid 10 billion on top of that in principal payments then it would only take a bit over 1500 years to pay it off.
That is not taking into account the cost of US inflation that is above or below the world inflation number. We are not going to pay it off - we will default and a lot sooner than most people understand.

 

[SayMyName]

And war. Let's not forget war, which many of those same CEO's and the other party long supported, and even instigated, over the last 100 years and more. The latest war and its cost of 1 trillion dollars began the current slide from which we are still trying to recover.

Both sides, and those in the banking sectors, as well as the CEO's of corporations, have only themselves to blame. Then again, I don't think they could care less about the rest of us, if they ever did at all.

Still, chin up. One day at a time. We will survive. Well, some of us will.

 

[ReallyMeow]

How do you pay back $16,400,000,000,000?
If you paid a billion dollars a year it would not pay the interest. For each percent of interest you would pay 164 billion dollars each year. If the US has really good credit and gets a very low rate we might pay only 246 billion dollars each year in INTEREST (1.5%). If you paid 10 billion on top of that in principal payments then it would only take a bit over 1500 years to pay it off.
That is not taking into account the cost of US inflation that is above or below the world inflation number. We are not going to pay it off - we will default and a lot sooner than most people understand.

Yeah, interest is about that much, but thats still only 6% of our budget. The concept of deficit spending comes from the idea that if we borrow money instead of taking it from the rich now, we can take it later, plus interest and all be better off for the exercise. Thing is, it hasnt panned out, the lower the tax rate goes, the worse the economy gets, so after 30 years of failure its time to call in our debts.