CDZ redistribution of wealth

[there4eyeM]

Anyone else know who said this?

It is not needed nor fitting here that a general argument should be made in favor of popular institutions, but there is one point, with its connections, not so hackneyed as most others, to which I ask a brief attention. It is the effort to place capital on an equal footing with, if not above, labor in the structure of government. It is assumed that labor is available only in connection with capital; that nobody labors unless somebody else, owning capital, somehow by the use of it induces him to labor. This assumed, it is next considered whether it is best that capital shall hire laborers, and thus induce them to work by their own consent, or buy them and drive them to it without their consent. Having proceeded so far, it is naturally concluded that all laborers are either hired laborers or what we call slaves. And further, it is assumed that whoever is once a hired laborer is fixed in that condition for life.

Now there is no such relation between capital and labor as assumed, nor is there any such thing as a free man being fixed for life in the condition of a hired laborer. Both these assumptions are false, and all inferences from them are groundless.

Labor is prior to and independent of capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration. Capital has its rights, which are as worthy of protection as any other rights. Nor is it denied that there is, and probably always will be, a relation between labor and capital producing mutual benefits. The error is in assuming that the whole labor of community exists within that relation. A few men own capital, and that few avoid labor themselves, and with their capital hire or buy another few to labor for them. A large majority belong to neither class--neither work for others nor have others working for them. In most of the Southern States a majority of the whole people of all colors are neither slaves nor masters, while in the Northern a large majority are neither hirers nor hired. Men, with their families--wives, sons, and daughters--work for themselves on their farms, in their houses, and in their shops, taking the whole product to themselves, and asking no favors of capital on the one hand nor of hired laborers or slaves on the other. It is not forgotten that a considerable number of persons mingle their own labor with capital; that is, they labor with their own hands and also buy or hire others to labor for them; but this is only a mixed and not a distinct class. No principle stated is disturbed by the existence of this mixed class.

Again, as has already been said, there is not of necessity any such thing as the free hired laborer being fixed to that condition for life. Many independent men everywhere in these States a few years back in their lives were hired laborers. The prudent, penniless beginner in the world labors for wages awhile, saves a surplus with which to buy tools or land for himself, then labors on his own account another while, and at length hires another new beginner to help him. This is the just and generous and prosperous system which opens the way to all, gives hope to all, and consequent energy and progress and improvement of condition to all. No men living are more worthy to be trusted than those who toil up from poverty; none less inclined to take or touch aught which they have not honestly earned. Let them beware of surrendering a political power which they already possess, and which if surrendered will surely be used to close the door of advancement against such as they and to fix new disabilities and burdens upon them till all of liberty shall be lost.

 

[emilynghiem]

Is redistribution of wealth, aided by social institutions, from the top down wrong, but from up from the lower strata to the top OK?

there4eyeM
Only if the participants AGREE to the terms, such as a team of players all AGREEING to share in cleaning up the field after playing; or students and teachers AGREE to work with a school that requires the students to clean up all trash afterwards.

You can have communism, capitalism, socialism whateverism if all the members of that community agree to the rules. If they agree to the representation and agree to the rules of due process for resolving any issues.

Just watch out for the collective authority being abused to oppress individuals,
or you will get the same situation that called for our Bill of Rights to check govt and collective authority against abuses of individuals.

 

[emilynghiem]

Is redistribution of wealth, aided by social institutions, from the top down wrong, but from up from the lower strata to the top OK?

The purpose of an economy is not producing GDP it's increasing the welfare of most citizens.
Joseph Stiglitz

Cooperative Economics and Abundance Mentality
all work by Free Choice in participation for the mutual benefit and investment in growth for all.

Collaboration works when people CHOOSE how to work together.
Nobody I know agrees to a system being forced on them against their will.

 

[emilynghiem]

I don't know about the tiresome "socialism vs. capitalism" standbys, but it seems apparent that production (laborers) have created a vast amount of wealth that is inappropriately confiscated by firms. Wages should increase so that the source of the profits (laborers) are equitably compensated for their success and productivity.

Workers are everything and the source of all capital.

Freemason9
Blood is necessary to flow to all organs of the body.

But if you don't regulate the flow naturally and in healthy balance,
then you have problems if too much blood flows in one area (causing hemorrhaging, bleeding out or clots etc.)
and/or not enough flows where it is needed that causes cells or whole limbs to lose function.

The body cannot function without BOTH the various parts
and the REGULATORY systems that affect
cardiovascular and respiratory circulation, as well as chemicals/hormones and the endrocrine systems, and the mind/body coordination.

Likewise in society we need both the workers and the guidance/supervision and even
training from management positions,
which is also a task in itself like any other job. We need both, and all roles should be
in balance, and they should work together for the good of the whole.

 

[Andylusion]

Is redistribution of wealth, aided by social institutions, from the top down wrong, but from up from the lower strata to the top OK?

The purpose of an economy is not producing GDP it's increasing the welfare of most citizens.
Joseph Stiglitz

I would disagree with that. That's what people in Ivory Towers think. To the common man, the reason a man makes something, and sells it, is to make money.

The reason a man hires someone to work with him, is because he's got work that needs done, and because he believes the cost of hiring will be lower than the value he will bring in profit.

Neither has anything to do with "to increase welfare of most citizens".

Both have to do with "self advancement".

The natural result of "self advancement" is "mutual advancement".

If the worker was not benefiting from having the job, he wouldn't do the job.
If the employer was not benefiting from having the employee, he wouldn't have the employee.

Any time that you try and force people into any situation where the motivation is for the benefit of someone else, you almost by definition, reduce the incentive for them to do it.

If you say you must pay someone X amount, so that the purpose of their employment is for the benefit of the employee instead of the employer.... by definition you reduce the incentive to have an employee.

When you do that, the employer is less likely to have an employee. Thus under a system of "increasing the welfare of most citizens", the result is that fewer citizens have jobs. Which of course decreases the welfare of most citizens.

A perfect example would be health care mandates that caused Staples to reduce employee hours to 25. You pass a law with the goal of "to increase welfare of most citizens", which reduces the incentive to have the employer have people work. Thus they cut back the number of hours. Result is people are less well off than they were before.

 

[Andylusion]

What about the tax situations that transfered the burden from the top to the bottom (as under Reagan)?

I don't really understand this claim at all.

By any reasonable measure, the tax burden on the top 1% increased under Reagan. The rich were more likely to pay the tax, instead of hiding it in tax shelters, because the rate was lower.

How is jacking up the tax rate, so that the Rich hide their wealth, and pay less or no tax, better?

 

[CultureCitizen]

I would disagree with that. That's what people in Ivory Towers think. To the common man, the reason a man makes something, and sells it, is to make money.

The reason a man hires someone to work with him, is because he's got work that needs done, and because he believes the cost of hiring will be lower than the value he will bring in profit.

Neither has anything to do with "to increase welfare of most citizens".

Both have to do with "self advancement".

The natural result of "self advancement" is "mutual advancement".

If the worker was not benefiting from having the job, he wouldn't do the job.
If the employer was not benefiting from having the employee, he wouldn't have the employee.

Any time that you try and force people into any situation where the motivation is for the benefit of someone else, you almost by definition, reduce the incentive for them to do it.

If you say you must pay someone X amount, so that the purpose of their employment is for the benefit of the employee instead of the employer.... by definition you reduce the incentive to have an employee.

When you do that, the employer is less likely to have an employee. Thus under a system of "increasing the welfare of most citizens", the result is that fewer citizens have jobs. Which of course decreases the welfare of most citizens.

A perfect example would be health care mandates that caused Staples to reduce employee hours to 25. You pass a law with the goal of "to increase welfare of most citizens", which reduces the incentive to have the employer have people work. Thus they cut back the number of hours. Result is people are less well off than they were before.

I think you are confusing positive with normative economics.
So , the mechanics you describe are part of the positive economics , the study of what is regarding the economic relationships.
Normative economics describes how it should be.
So, while it is true that producing goods with no pollution controls is mutually beneficial for both the factory and the consumers, because it is posible to have higher wages, lower prices and more production. In the long run the damage produced by pollution will affect everyone who is near the factory.

The government has to deal with both : positive economics ( the actual economic forces ) and normative economics.

Now, if your opinion is that "normative economics" should be completely disregarded, then I disagree.

Normative economics - Wikipedia the free encyclopedia
Positive economics - Wikipedia the free encyclopedia

 

[CultureCitizen]

I don't really understand this claim at all.

By any reasonable measure, the tax burden on the top 1% increased under Reagan. The rich were more likely to pay the tax, instead of hiding it in tax shelters, because the rate was lower.

How is jacking up the tax rate, so that the Rich hide their wealth, and pay less or no tax, better?

QE is a form in which this happens, it is the equivalent of exchanging the purchase order of a company with actual cash.
The company in which I work would really like to be capitalized in such a fashion.

 

[Mac1958]

Workers are everything and the source of all capital.

What type of economic system would you call that?

.

 

[danielpalos]

dudes and Esquires,

Both terms to promote and provide regarding the general Welfare are expressly declared in our supreme law of the land, should there be Any need to quibble in the legal venue of the general government and that body of laws known as the Constitution of our Body politic.

constitution
noun con·sti·tu·tion \ˌkän(t)-stə-ˈtü-shən, -ˈtyü-\
: the system of beliefs and laws by which a country, state, or organization is governed
: a document that describes this system
: the physical health and condition of a person or animal
Source: Constitution - Definition and More from the Free Merriam-Webster Dictionary

 

[Andylusion]

I would disagree with that. That's what people in Ivory Towers think. To the common man, the reason a man makes something, and sells it, is to make money.

The reason a man hires someone to work with him, is because he's got work that needs done, and because he believes the cost of hiring will be lower than the value he will bring in profit.

Neither has anything to do with "to increase welfare of most citizens".

Both have to do with "self advancement".

The natural result of "self advancement" is "mutual advancement".

If the worker was not benefiting from having the job, he wouldn't do the job.
If the employer was not benefiting from having the employee, he wouldn't have the employee.

Any time that you try and force people into any situation where the motivation is for the benefit of someone else, you almost by definition, reduce the incentive for them to do it.

If you say you must pay someone X amount, so that the purpose of their employment is for the benefit of the employee instead of the employer.... by definition you reduce the incentive to have an employee.

When you do that, the employer is less likely to have an employee. Thus under a system of "increasing the welfare of most citizens", the result is that fewer citizens have jobs. Which of course decreases the welfare of most citizens.

A perfect example would be health care mandates that caused Staples to reduce employee hours to 25. You pass a law with the goal of "to increase welfare of most citizens", which reduces the incentive to have the employer have people work. Thus they cut back the number of hours. Result is people are less well off than they were before.

I think you are confusing positive with normative economics.
So , the mechanics you describe are part of the positive economics , the study of what is regarding the economic relationships.
Normative economics describes how it should be.
So, while it is true that producing goods with no pollution controls is mutually beneficial for both the factory and the consumers, because it is posible to have higher wages, lower prices and more production. In the long run the damage produced by pollution will affect everyone who is near the factory.

The government has to deal with both : positive economics ( the actual economic forces ) and normative economics.

Now, if your opinion is that "normative economics" should be completely disregarded, then I disagree.

Normative economics - Wikipedia the free encyclopedia
Positive economics - Wikipedia the free encyclopedia

Basic ecological controls are not a problem. The problem is, people tend to want to apply normative economics to things that it doesn't apply to. Such as health care.

Even with examples such as the pollution of a river, there are better ways to deal with it, than simply having government assign a cookie cutter policy, which usually fails to be economical, or ecological.

An alternative would be in Germany, where rivers were incorporated. Actually make a corporation that owns the river. To use the river, companies must pay a fee for use, relative to their pollution, to the river corporation. Equally the river corporations uses its profits to find innovative ways to keep the river clean.

Of course that involves capitalism, and free-market principals, which means that the generally left-leaning eco-nuts are always against it.

But all of this, is beside my point.

Regardless, at some level every time you force companies to shoulder more burden of "social welfare", whether it is health insurance, or pollution, you still reduce incentive to produce domestically.

You can define it as normative, or positive, or whatever else... the result is still the same. Less employment, less welfare, less production.

Tesla isn't building electric cars because they want to improve the social welfare of the country. They talk a good game, because they are playing a game. The game of making money.

If you change the pollution laws, so that it is no longer profitable to make Tesla Cars here in the US, they will leave. They will go somewhere else, and build them there, and sell them to us from that country. Then you'll be complaining about companies off-shoring jobs.

But the two are connected. You can't beat companies over the head with every regulation you dream up, and then be moronically shocked companies incorporate outside the US, and invest their profits elsewhere. And of course every single regulation has some all important reason behind it. That doesn't change the result.

 

[Andylusion]

I don't really understand this claim at all.

By any reasonable measure, the tax burden on the top 1% increased under Reagan. The rich were more likely to pay the tax, instead of hiding it in tax shelters, because the rate was lower.

How is jacking up the tax rate, so that the Rich hide their wealth, and pay less or no tax, better?

QE is a form in which this happens, it is the equivalent of exchanging the purchase order of a company with actual cash.
The company in which I work would really like to be capitalized in such a fashion.

Your response didn't fit at all with my post.

QE has nothing to do with tax burden. QE doesn't change how much rich people pay in taxes.

QE is just a bad monetary policy pushed by bankers. Unless you want to claim that only bankers are the 1%, which there are thousands of counter examples.... I don't follow the point of your post.

 

[there4eyeM]

What about the tax situations that transfered the burden from the top to the bottom (as under Reagan)?

I don't really understand this claim at all.

By any reasonable measure, the tax burden on the top 1% increased under Reagan. The rich were more likely to pay the tax, instead of hiding it in tax shelters, because the rate was lower.

How is jacking up the tax rate, so that the Rich hide their wealth, and pay less or no tax, better?

excerpt from article found here: Shifting Burdens ndash U.S. Taxes By Income Level Over The Years

...Three years later, Reagan entered office and began turning the tables, finishing in 1988 with his retrograde 28% upper rate. The rich were now on tax vacation, at the expense of the poor and middle class.

 

[danielpalos]

The point and that alternative is, that Policies Public, should promote the general welfare; and not merely serve as relatively secure investment vehicles for the wealthiest, even if at the expense of Individual Liberty for the least wealthy.

I would rather be exposed to the inconveniences attending too much liberty than those attending too small a degree of it.
Thomas Jefferson

If only, we could convince the right to be more cognitively sonant to their alleged Cause of limited government.

 

[Andylusion]

What about the tax situations that transfered the burden from the top to the bottom (as under Reagan)?

I don't really understand this claim at all.

By any reasonable measure, the tax burden on the top 1% increased under Reagan. The rich were more likely to pay the tax, instead of hiding it in tax shelters, because the rate was lower.

How is jacking up the tax rate, so that the Rich hide their wealth, and pay less or no tax, better?

excerpt from article found here: Shifting Burdens ndash U.S. Taxes By Income Level Over The Years

...Three years later, Reagan entered office and began turning the tables, finishing in 1988 with his retrograde 28% upper rate. The rich were now on tax vacation, at the expense of the poor and middle class.

Right, and anyone can write anything on their blog. Further, the graph, although nifty, is either a lie, or irrelevant. I can't tell if he is intentionally misleading people, or just focuses on irrelevant things.

He's looking at tax rates. Tax rates can be anything. What matters is how much money people are actually paying in tax, not what the rate is.

Two perfect examples of this. First, from the graph. In 1977, Carter did reduce the tax rate on those earning less than $1,600 a year. But how many were paying taxes on that $1,600 before this? None. The deductions already in place, excluded that income already.

Equally, it's true that 1877 Reagan, due to simplifying the tax code (reducing 15 marginal rates, down to 5), resulted in the lowest bracket being merged into the 11% bracket. Thus "raising" taxes on those earning the lowest bracket ($1,835 in 1986), to the 11% rate. But again, how many actually paid this rate? Due to already existing deductions, the amount paid was once again, zero. None.

If you don't think that's true, look at the graph, and consider 47% of Americans didn't pay tax in 2009. 43% did not pay any tax in 2013.

If you look at that graph, the bottom half of the income scale should in fact be ZERO. No tax at all. The graph should not even begin until about $43K income and up. Of course that would screw up the claim the rich are paying less, and the poor are paying more, which would fail to meet the bloggers propaganda motive.

The second example, is when you look at EFFECTIVE tax rates, instead of just marginal rates.

EFFECTIVE tax rates, is the actual amount of money that people are paying in taxes, verses their income.

In 1979, the top marginal rate was 70%. How much did the top 1% actually pay in taxes? Only about 22.7%.

In 2009, the top marginal rate was 35%. How much did the top 1% actually pay in taxes? Only about 21%.

A cut of 35% in taxes, only changes at most, about 3% in effective rate. Not all that significant.

So any ignorant blogger can claim that the wealthy have a tax holiday, the facts are they are paying the majority of the taxes, and by a very wide margin.

 

[Andylusion]

The point and that alternative is, that Policies Public, should promote the general welfare; and not merely serve as relatively secure investment vehicles for the wealthiest, even if at the expense of Individual Liberty for the least wealthy.

I would rather be exposed to the inconveniences attending too much liberty than those attending too small a degree of it.
Thomas Jefferson

If only, we could convince the right to be more cognitively sonant to their alleged Cause of limited government.

I would agree with both of those statements above. I want less regulations, both so that we promote the general welfare and not the mega corporations, and because regulations inherently limit freedom, and I'd rather have to deal with the inconvenience of too much freedom, rather than too little.

The problem is, the left is really really good as *SAYING* they support these goals, but in practice, they do everything they can to do the very opposite. They shackle the public with as much overbearing regulation to control every aspect of our lives, and at the same time promote the wealthy, at the expensive of the general population.

 

[CultureCitizen]

Basic ecological controls are not a problem. The problem is, people tend to want to apply normative economics to things that it doesn't apply to. Such as health care.

Even with examples such as the pollution of a river, there are better ways to deal with it, than simply having government assign a cookie cutter policy, which usually fails to be economical, or ecological.

An alternative would be in Germany, where rivers were incorporated. Actually make a corporation that owns the river. To use the river, companies must pay a fee for use, relative to their pollution, to the river corporation. Equally the river corporations uses its profits to find innovative ways to keep the river clean.

Of course that involves capitalism, and free-market principals, which means that the generally left-leaning eco-nuts are always against it.

But all of this, is beside my point.

Regardless, at some level every time you force companies to shoulder more burden of "social welfare", whether it is health insurance, or pollution, you still reduce incentive to produce domestically.

You can define it as normative, or positive, or whatever else... the result is still the same. Less employment, less welfare, less production.

Tesla isn't building electric cars because they want to improve the social welfare of the country. They talk a good game, because they are playing a game. The game of making money.

If you change the pollution laws, so that it is no longer profitable to make Tesla Cars here in the US, they will leave. They will go somewhere else, and build them there, and sell them to us from that country. Then you'll be complaining about companies off-shoring jobs.

But the two are connected. You can't beat companies over the head with every regulation you dream up, and then be moronically shocked companies incorporate outside the US, and invest their profits elsewhere. And of course every single regulation has some all important reason behind it. That doesn't change the result.

I used the ecology example, because it is one in which externalities and the need to regulate are easy to spot.
No serious economist would go around making policies disregarding positive economics.
The problem I find with your post is that you talk as if "positive economics" was the rule of law, even worse, you leave no room for problems which "positive economics" acknowledges and which make necesary applying normative economics.

Normative and positive are not terms I coined, but rather terms which exist long ago and are taught at economics 101.

What most mercantilist fail to see are the social aspects of economy, the what-could-go-wrong which does not depend on the strictly monetary aspects of transactions. These aspects are what make policy making necesary, specially when the policy can achieve nearly pareto efficiency.

 

[Andylusion]

Basic ecological controls are not a problem. The problem is, people tend to want to apply normative economics to things that it doesn't apply to. Such as health care.

Even with examples such as the pollution of a river, there are better ways to deal with it, than simply having government assign a cookie cutter policy, which usually fails to be economical, or ecological.

An alternative would be in Germany, where rivers were incorporated. Actually make a corporation that owns the river. To use the river, companies must pay a fee for use, relative to their pollution, to the river corporation. Equally the river corporations uses its profits to find innovative ways to keep the river clean.

Of course that involves capitalism, and free-market principals, which means that the generally left-leaning eco-nuts are always against it.

But all of this, is beside my point.

Regardless, at some level every time you force companies to shoulder more burden of "social welfare", whether it is health insurance, or pollution, you still reduce incentive to produce domestically.

You can define it as normative, or positive, or whatever else... the result is still the same. Less employment, less welfare, less production.

Tesla isn't building electric cars because they want to improve the social welfare of the country. They talk a good game, because they are playing a game. The game of making money.

If you change the pollution laws, so that it is no longer profitable to make Tesla Cars here in the US, they will leave. They will go somewhere else, and build them there, and sell them to us from that country. Then you'll be complaining about companies off-shoring jobs.

But the two are connected. You can't beat companies over the head with every regulation you dream up, and then be moronically shocked companies incorporate outside the US, and invest their profits elsewhere. And of course every single regulation has some all important reason behind it. That doesn't change the result.

I used the ecology example, because it is one in which externalities and the need to regulate are easy to spot.
No serious economist would go around making policies disregarding positive economics.
The problem I find with your post is that you talk as if "positive economics" was the rule of law, even worse, you leave no room for problems which "positive economics" acknowledges and which make necesary applying normative economics.

Normative and positive are not terms I coined, but rather terms which exist long ago and are taught at economics 101.

What most mercantilist fail to see are the social aspects of economy, the what-could-go-wrong which is does not depend on the strictly monetary aspects of transactions. These aspects are what make policy making necesary, specially when the policy achieve nearly pareto efficiency.

Well you claim no serious economist would ignore positive economics, and yet I see that all the time.

And yes, positive economics is the rule of law.

If I don't make a profit from hiring someone, then I'm not going to hire someone. If there is no benefit to me in creating jobs, then I will not create any jobs. No amount of normative economics, no amount "social justice" or "economic fairness", no amount of "this is the way it ought to be" will ever convince anyone to hire someone that brings in less money than they cost in hiring.

Equally, no consumer intentionally goes to the store with the highest prices, because "workers ought to be paid more".

Any attempt to enforce that alternate system, will result in negative consequences, and ultimately the Soviet Union is gone for a reason.

 

[CultureCitizen]

Your response didn't fit at all with my post.

QE has nothing to do with tax burden. QE doesn't change how much rich people pay in taxes.

QE is just a bad monetary policy pushed by bankers. Unless you want to claim that only bankers are the 1%, which there are thousands of counter examples.... I don't follow the point of your post.

It's a form of welfare for the rich... for the ultra rich I might add, not just bad monetary policy.
I find the cozy arrangemente between insurance companies and healthcare providers another (and very subtle ) form of welfare for both sectors( specially denying insurance on pre-existing conditions).
Another one would be war (specially optional wars), as it brings great beneffits to all military contractors ( blackwater included)

So it is not only taxes, but how the policies affect government and personal spending.

 

[CultureCitizen]

If I don't make a profit from hiring someone, then I'm not going to hire someone. If there is no benefit to me in creating jobs, then I will not create any jobs. No amount of normative economics, no amount "social justice" or "economic fairness", no amount of "this is the way it ought to be" will ever convince anyone to hire someone that brings in less money than they cost in hiring.

There are situations in which this creates a recession spiral and in which I would argue that government intevention is necessary : recession .

Given that the internal market is contracted, a tax cut will not improve the situation of the country, unless the main export destinations are growing fast enough.

To this date I have not found a case in which a country in recession has worked out its way out of recession by cutting taxes ( actually the situation gets worse if the tax cut is coupled with an expenditure cut ) . You need to change policies for this situation as well as others in which a market failure occurs.

Now, if you know of a case in which a county has cutted its way out of recession by cutting taxes ( and probably government expenditure ) , it would be very interesting to know about it.

Equally, no consumer intentionally goes to the store with the highest prices, because "workers ought to be paid more".

No , but they tend to go to the highest prices out of self interest. This was actually the problem with the housing bubble , as well as stock market bubbles ( or any other price bubble).