Minimum Wage --Prevents-- Wealth Acquisition!

[danielpalos]

It is Only the Bad management of our current regime of minimum wage that prevents wealth acquisition; Good management of a regime of minimum wage would simply solve simple poverty and capitalism's natural rate of unemployment; on an at-will basis in our at-will employment States.

It merely requires Good management and not Bad management.

 

[Andylusion]

In the 1950s, Cuba had a standard of living closer to the US. From then, till now, the left has been screaming non-stop that the only reason Cuba is poor, the only reason they can't buy a new car, or or give aspirin to the ill, is all because of the embargo.

Shocking concept.

Interesting . Well , you will probably like to know that Cuba has been outperforming Mexico during the whole NAFTA period. Cuban embargo ,and Mexican mass migration and remittances notwithstanding.

gdp per capita ppp mexico | gdp per capita ppp cuba - Wolfram|Alpha

Shocking isn't it ?
Oh, but there's more... It actually outperformed the rate of growth of the USA.
While the per capita ppp income in America went from 24,000 in 1990 to 54,629 in 2014 or a factor of 2.27
Cuba's gdp per capita ppp went from 8,835 to 20,788 which is a factor of 2.35.

And that of course is just the per capita income , becuse household income has been stagnated for two decades.
So please , continue telling me of the benefits of free trade.

Why would that be shocking?

Cuba has moved towards free trade, and moved towards Capitalism.

We would expect that the economy in a severely depressed economy, would drastically improve. And the lower the wages are to begin with, the higher the jump will be.

You realize that in 2004, the average Cuban wage was roughly 14 Pesos a day. 27 Pesos is a US dollar. So most of them work for 50¢ a day in 2004. One international business is allowed to setup and operate in Cuba, paying $1 a day, and the per capita income is going to double for them.

Why anyone would be shocked that Cuba opening up markets would result in a sudden jump in GDP, is beyond me for sure. You should expect that. Everyone should.

Today the average income is 24 Pesos a day. That's a massive jump in average pay, in just 10 years.

And they have more trade, more economic freedom, private business, private land ownership. The liberalizing of the economy is paying huge dividends.

The BBC did a documentary on private business in Cuba just a week or so ago. There's a guy buying cars (illegal before), and buying imported parts (illegal before), repairing the cars and selling them for a profit (illegal before). Yeah..... dude wages and GDP is going to rise in Cuba.... and FAST.

That's Capitalism in action. Capitalism ALWAYS works. Every single time it's tried.

You talk as if central planning and regulations had disapeared from Cuba overnight and the embargo had been lifted 20 years ago. Cuba has embraced capitalism partialy ( as china did ) , but it does not embrace free trade ( how can it be called free trade with an embargo enacted )
Also notice :

"The top individual income tax rate is 50 percent. The top corporate tax rate is 30 percent (35 percent for wholly foreign-owned companies). Other taxes include a tax on property transfers and a sales tax. The overall tax burden is 24.4 percent of GDP. Government spending is around 67 percent of GDP, and public debt is around 35 percent of the domestic economy. Despite reforms, the government continues to play a large role in the economy"

I am sure most Americans would flinch at the perspective of having government in control of 67% of GDP.
There is a clear distinction between capitalism and the different shapes it takes like mercantilism and free trade ( which are opposed ) .

"Free trade is a policy followed by some international markets in which countries' governments do not restrict imports from or exports to other countries. Free trade is exemplified by the European Economic Area and the North American Free Trade Agreement, which have established open markets."

No, you just made that up. I never suggested anything like that.

My statement wasn't that ambiguous. I suggested that fast Cuban economic growth shouldn't be surprising because they are moving towards Capitalism, and away from Socialism. Every time any country does this, the result is ALWAYS fast economic growth.

I then gave a direct example from the BBC, illustrating my point.

Going from Socialism to Capitalism, or the reverse, is not like flipping a light switch off and on. It's more like a dimmer switch, that varies by degrees.

Cuba is moving towards Capitalism, and very fast. Even Communist China, required almost a decade of slowly allowing commune farms, to convert to privately run farms. Cuba has completely opened the door to private ownership, and private business, and profit based economics. Are there still some levels of socialized control? Of course. But like the BBC article showed, nearly everything that business owner did, was entirely illegal just a few years ago.

Yes Americans would flinch at 67% of the GDP being controlled by the government. But that makes my point, more than yours. After all, it was 100% of GDP just a few years ago. The fact that 1/3rd of the economy is now private, when Raul Castro only came to power in 2008 and started those reforms.... that's a massive step towards Capitalism.

The embargo is a non-event. Yes, it prevented US corporations from directly selling and buying from Cuba.... true. But it never stopped international traders from buying and selling in Cuba.

In fact, if you go to the tourist areas in Cuba, you can find name brands. Coke-Cola and beers and so on. How do they get there? Coke sells to Brazil, or some other country, and they sell to Cuba.

The embargo is almost completely irrelevant. The only real purpose the embargo has served, is to give the Cuban government an excuse for why their economic policies have utterly destroyed Cuba.

Cuban imports and exports have been increasing year over year since the 1990s. Top trading partners include Brazil, Mexico, Spain, China, Italy, France, Canada, and Germany.

The embargo was a bad policy designed to get votes, which never worked, and serves no purpose. But it is not an excuse for Cuba's bad economy. That is entirely due to their central planning socialistic policies that have ruined them.

 

[danielpalos]

some on the left now know, that we should merely Use capitalism for all of its worth under any form of Socialism.

 

[CultureCitizen]

After all, it was 100% of GDP just a few years ago. The fact that 1/3rd of the economy is now private, when Raul Castro only came to power in 2008 and started those reforms.... that's a massive step towards Capitalism.

It was never 100% , that's a myth . There were allways hotels owned by foreigners : spanish mostly , as well as investments from Canada and Mexico. I'll do some research to find out the exact number.

 

[Andylusion]

You want to see innovation in America disappear? Just put in place massive protectionism. We can stay in stagnant isolation too. But at least no Hindustan Ambassador workers lost their jobs building a crappy poor handling weakly powered clown car from the 1950s. That's a 'good' thing right?

You are taking my statement out of context.
1) Competition is necesary period. I don't argue that.
2) That said , doing the average joe washington concensus neo liberal free trade agreement does not benefit the less developed economy.

3) As an alternative Asian countries have established a diferent model , allowing "limited competition", protecting certain industries by government intervention or by tariffs.
While this has prooved a great for nations in development , it has prooved the doom for the USA.
It is woefully miopic that 99% of the people I duscuss can't see the difference between 1 and 2.

4) Ultimately China's own excesive investment has created excesive production capacity and production at the cost of a gigantic private debt . That is a bubble which is about to burst ( I give it 1 year max).

5) You make a terrible mistake : you can't distinguish free trade with controlled trade. Nor China, nor Cuba nor SK followed a free trade strategy. In the first two cases the state remained a key element of the production for many years.
In the second infant industry was successfully protected by tariffs, this is also what the US made to avoid direct competition with the British Empire.

It does not benefit less developed economy? Then why is China benefiting? Why is India benefiting?

You are trying to make an argument, that the Chinese themselves are not making.

http://fta.mofcom.gov.cn/english/index.shtml

The Chinese Government deems Free Trade Agreements (FTAs) as a new platform to further opening up to the outside and speeding up domestic reforms, an effective approach to integrate into global economy and strengthen economic cooperation with other economies, as well as particularly an important supplement to the multilateral trading system. Currently, China has 19 FTAs under construction, among which 14 Agreements have been signed and implemented already.​

So clearly they see it as a benefit.

No, the US protections failed miserably. If anything, industries behind protectionist walls, floundered, and remained undeveloped. (because they didn't have to develop).

 

[Andylusion]

After all, it was 100% of GDP just a few years ago. The fact that 1/3rd of the economy is now private, when Raul Castro only came to power in 2008 and started those reforms.... that's a massive step towards Capitalism.

It was never 100% , that's a myth . There were allways hotels owned by foreigners : spanish mostly , as well as investments from Canada and Mexico. I'll do some research to find out the exact number.

That isn't what I have read. Doesn't mean it is not wrong. But what I've read is that prior to the early 90s, there were zero privately owned anything. Cuba was one of the very few countries that successfully banned all private ownership. Granted it didn't last long.

When the Soviets fell, Cuba was in an absolute disaster. In response, they allowed 'joint-venture' businesses. The joint part, was of course with the government. There are no 'private' resorts. There are Joint-Venture resorts that are owned largely by the government, with outside (typically Spanish) company partners.

The only other source of 'private' GDP, was self-employment, which the Cuban government allowed. But you were banned from hiring anyone as an employee. But as late as 1991, less than 5% of Cuba's GDP came from non-public non-government sources.

That's not surprising since being self-employed had limited applications. Can't really be a car mechanic, when you are not allowed to buy the parts, to fix the cars. Short of cutting hair, options for being self-employed were limited.

 

[Andylusion]

Yes, China has State Owned Enterprises. Well there's a shock... since for 50 plus years, private enterprise was nearly banned. The fact that SOEs only employ 20% of the labor force today, and only account for 30% of the economy, and nearly all the growth is from private industry, and nearly all SOEs have private stake holders, and ALL are planned to be privatized in the future.... Not a big factor anymore.

Uh ... some of your posts are so long I sometimes feel like skiping them altogether.

What about taking a look at asset shares ?

"With all these evidences in hand, we can now answer the question raised before: How big are Chinese SOEs? Even though their share in the economy continued to decline in the past decade, SOEs still make up a substantial part of the national economy – roughly controlling 30 percent of the total secondary and tertiary assets, or over 50 percent of total industrial assets. The average size of SOEs is much bigger than their non-SOE peers, with average assets of the former equaling over 13 times of the latter."

50% of industrial assets !! Sory , but I can't consider that "not a big factor anymore".


State-owned enterprises in China: How big are they?

That's irrelevant. Industrial assets doesn't matter. If I had billions, I could buy all the old Steel Mills in Ohio, that are all closed. I would own the vast majority of Industrial assets in Ohio. Doesn't matter. I'm not employing people. I'm not producing steel. I'm not growing the domestic product.

Owning it... doesn't mean it's employing all the workers. Owning it... doesn't mean it's the most significant portion of the GDP. Owning it.... doesn't mean it's growing.

The private companies employee the vast majority of employees. The private companies produce the vast majority of GDP. The private companies are growing more than twice as fast as the big state companies.

The growth in China today isn't SOEs. It's private enterprise.

 

[mudwhistle]

Most liberals don't understand this because they don't really grasp the principles of free market capitalism. They react emotively and without thinking about consequences of what their emotions drive them to do. And when you're dealing with free market capitalism, this can be very costly because you can't put the toothpaste back in the tube. Such is the case with our beloved minimum wage.

Oh sure, it has been considered a wonderful idea through all the years... helped the poor exploited worker be treated at least half-way decently... but it has also produced a society full of idiots who don't comprehend how it has damaged the individual's ability to prosper. It's a big giant ball and chain on our ability to negotiate. In order to understand this, you must understand how the principles of free market capitalism (supply and demand) operate.

As I said, the toothpaste is out already, can't put it back now... So I am not suggesting we should get rid of the minimum wage at this time. Various reasons for that but it all goes back to the toothpaste already being out of the tube... we've already established a free market system around this baseline labor cost, any change now would be somewhat detrimental to a lot of people. The better idea at this point is to leave it alone and focus on making it irrelevant. Raising it is stupid and pointless because all you're ultimately doing is decreasing the value of a dollar.

But now... Let's go back to 1912, when this issue was first being debated. The First Progressive Movement was hell bent on establishing a minimum wage, at that time, for women and children. They tried numerous times to do this and kept running into failure because the Supreme Court continued to rule the minimum wage unconstitutional. This went on for over 20 years in the first part of the 20th century. So when we get to the Great Depression, FDR takes this opportunity to implement a national minimum wage. He says, and I quote:

"No business which depends for existence on paying less than living wages to its workers has any right to continue in this country."

Now...... THAT sounds very familiar, doesn't it? ....Where have I heard THAT recently? Can it not be clearer that this abysmal liberal policy has FAILED? Here we are, 82 years later and the same Progressives are screaming the same thing! The dollar amount is all that is different.

Same argument, same idea, same solution that hasn't worked in 82 years. But it's all about emotion, you see?

Okay, follow me here... think about, what if.... What IF we had not adopted a MW and instead, we promoted individual and collective bargaining? We could have established anti-trust laws where employers had to 'reasonably negotiate' with prospective employees on the specific job available. Of course, we have to understand there were "corporatists" back then who didn't want that to happen. They went along with this "minimum wage" idea because it effectively base-lined labor costs. Think about it for a hot second...

Every wage in America, whether you belong to a union or not, is pretty much determined in relation to the current minimum wage. If that goes up, so do all the wages up the ladder because that is their base line. As long as the minimum wage remains where it is, the motivation for the capitalist is to keep wages the same. so we've stagnated wealth acquisition by base-lining labor cost. You can't negotiate a higher wage because the wage is set according to the minimum you've set. Raising the minimum doesn't help you negotiate, it eliminates the job you're negotiating for. If there were no such thing as a minimum wage, you could negotiate based on market value of labor.

We don't know how free market forces would have worked the past 82 years... Sure, children and women were exploited back in 1912... Sure, people were struggling in 1933... but had we taken a different road, one that encouraged free market capitalism instead of trying to regulate it... we may have experienced a different result. It might be that today, an average worker negotiates $15 hr. for a burger flipper job because no one else wants to flip burgers? It might mean the value of the dollar never declined and $5 hr. buys as much as $15 today? We just don't know because we didn't take that road.

The Minimum-wage is just a tool being used by the left to advance Marxist principles.....and give low-information voters the feeling that Democrats really give a **** about them. At the same time new government regulations increase costs to businesses, and ever increasing excise-taxes raise the price of goods and services.

Raising the MW also raises overhead for businesses, which have to turn around and raise prices......which eventually creates inflation and causes a never ending cycle of government dependence. It's really just smoke an mirrors. Your paycheck never goes up in value because as your pay increases, so does your taxes. At the same time the cost of everything is going up....thus the value of that dollar is steadily shrinking.

 

[EdwardBaiamonte]

Tell that to JD Rock and his standard oil monopoly Bubba, lol

100% stupid as always!! You had to go back 100 years in history to find a "monopoly" that was broken up even back then!!

See why we say stupid??? 100 years???

 

[CultureCitizen]

After all, it was 100% of GDP just a few years ago. The fact that 1/3rd of the economy is now private, when Raul Castro only came to power in 2008 and started those reforms.... that's a massive step towards Capitalism.

It was never 100% , that's a myth . There were allways hotels owned by foreigners : spanish mostly , as well as investments from Canada and Mexico. I'll do some research to find out the exact number.

That isn't what I have read. Doesn't mean it is not wrong. But what I've read is that prior to the early 90s, there were zero privately owned anything. Cuba was one of the very few countries that successfully banned all private ownership. Granted it didn't last long.

When the Soviets fell, Cuba was in an absolute disaster. In response, they allowed 'joint-venture' businesses. The joint part, was of course with the government. There are no 'private' resorts. There are Joint-Venture resorts that are owned largely by the government, with outside (typically Spanish) company partners.

The only other source of 'private' GDP, was self-employment, which the Cuban government allowed. But you were banned from hiring anyone as an employee. But as late as 1991, less than 5% of Cuba's GDP came from non-public non-government sources.

That's not surprising since being self-employed had limited applications. Can't really be a car mechanic, when you are not allowed to buy the parts, to fix the cars. Short of cutting hair, options for being self-employed were limited.

I found the "correct" number... in a blog: 94%... I am allways wary of absolutes: there is no place on earth with 100% free market or 100% government controlled production. Very close to 100% though.

PERIODO REVOLUCIONARIO (1980-1991) | Cultura Cuba

 

[Dad2three]

In the 1950s, Cuba had a standard of living closer to the US. From then, till now, the left has been screaming non-stop that the only reason Cuba is poor, the only reason they can't buy a new car, or or give aspirin to the ill, is all because of the embargo.

Shocking concept.

Interesting . Well , you will probably like to know that Cuba has been outperforming Mexico during the whole NAFTA period. Cuban embargo ,and Mexican mass migration and remittances notwithstanding.

gdp per capita ppp mexico | gdp per capita ppp cuba - Wolfram|Alpha

Shocking isn't it ?
Oh, but there's more... It actually outperformed the rate of growth of the USA.
While the per capita ppp income in America went from 24,000 in 1990 to 54,629 in 2014 or a factor of 2.27
Cuba's gdp per capita ppp went from 8,835 to 20,788 which is a factor of 2.35.

And that of course is just the per capita income , becuse household income has been stagnated for two decades.
So please , continue telling me of the benefits of free trade.

Why would that be shocking?

Cuba has moved towards free trade, and moved towards Capitalism.

We would expect that the economy in a severely depressed economy, would drastically improve. And the lower the wages are to begin with, the higher the jump will be.

You realize that in 2004, the average Cuban wage was roughly 14 Pesos a day. 27 Pesos is a US dollar. So most of them work for 50¢ a day in 2004. One international business is allowed to setup and operate in Cuba, paying $1 a day, and the per capita income is going to double for them.

Why anyone would be shocked that Cuba opening up markets would result in a sudden jump in GDP, is beyond me for sure. You should expect that. Everyone should.

Today the average income is 24 Pesos a day. That's a massive jump in average pay, in just 10 years.

And they have more trade, more economic freedom, private business, private land ownership. The liberalizing of the economy is paying huge dividends.

The BBC did a documentary on private business in Cuba just a week or so ago. There's a guy buying cars (illegal before), and buying imported parts (illegal before), repairing the cars and selling them for a profit (illegal before). Yeah..... dude wages and GDP is going to rise in Cuba.... and FAST.

That's Capitalism in action. Capitalism ALWAYS works. Every single time it's tried.

You talk as if central planning and regulations had disapeared from Cuba overnight and the embargo had been lifted 20 years ago. Cuba has embraced capitalism partialy ( as china did ) , but it does not embrace free trade ( how can it be called free trade with an embargo enacted )
Also notice :

"The top individual income tax rate is 50 percent. The top corporate tax rate is 30 percent (35 percent for wholly foreign-owned companies). Other taxes include a tax on property transfers and a sales tax. The overall tax burden is 24.4 percent of GDP. Government spending is around 67 percent of GDP, and public debt is around 35 percent of the domestic economy. Despite reforms, the government continues to play a large role in the economy"

I am sure most Americans would flinch at the perspective of having government in control of 67% of GDP.
There is a clear distinction between capitalism and the different shapes it takes like mercantilism and free trade ( which are opposed ) .

"Free trade is a policy followed by some international markets in which countries' governments do not restrict imports from or exports to other countries. Free trade is exemplified by the European Economic Area and the North American Free Trade Agreement, which have established open markets."

No, you just made that up. I never suggested anything like that.

My statement wasn't that ambiguous. I suggested that fast Cuban economic growth shouldn't be surprising because they are moving towards Capitalism, and away from Socialism. Every time any country does this, the result is ALWAYS fast economic growth.

I then gave a direct example from the BBC, illustrating my point.

Going from Socialism to Capitalism, or the reverse, is not like flipping a light switch off and on. It's more like a dimmer switch, that varies by degrees.

Cuba is moving towards Capitalism, and very fast. Even Communist China, required almost a decade of slowly allowing commune farms, to convert to privately run farms. Cuba has completely opened the door to private ownership, and private business, and profit based economics. Are there still some levels of socialized control? Of course. But like the BBC article showed, nearly everything that business owner did, was entirely illegal just a few years ago.

Yes Americans would flinch at 67% of the GDP being controlled by the government. But that makes my point, more than yours. After all, it was 100% of GDP just a few years ago. The fact that 1/3rd of the economy is now private, when Raul Castro only came to power in 2008 and started those reforms.... that's a massive step towards Capitalism.

The embargo is a non-event. Yes, it prevented US corporations from directly selling and buying from Cuba.... true. But it never stopped international traders from buying and selling in Cuba.

In fact, if you go to the tourist areas in Cuba, you can find name brands. Coke-Cola and beers and so on. How do they get there? Coke sells to Brazil, or some other country, and they sell to Cuba.

The embargo is almost completely irrelevant. The only real purpose the embargo has served, is to give the Cuban government an excuse for why their economic policies have utterly destroyed Cuba.

Cuban imports and exports have been increasing year over year since the 1990s. Top trading partners include Brazil, Mexico, Spain, China, Italy, France, Canada, and Germany.

The embargo was a bad policy designed to get votes, which never worked, and serves no purpose. But it is not an excuse for Cuba's bad economy. That is entirely due to their central planning socialistic policies that have ruined them.

ONE question, how'd Chile do under Uncle Milties "reforms"?


A Critique of the Chicago School of Economics:

CHILE: THE LABORATORY TEST

Many people have often wondered what it would be like to create a nation based solely on their political and economic beliefs. Imagine: no opposition, no political rivals, no compromise of morals. Only a "benevolent dictator," if you will, setting up society according to your ideals.

The Chicago School of Economics got that chance for 16 years in Chile, under near-laboratory conditions. Between 1973 and 1989, a government team of economists trained at the University of Chicago dismantled or decentralized the Chilean state as far as was humanly possible. Their program included privatizing welfare and social programs, deregulating the market, liberalizing trade, rolling back trade unions, and rewriting its constitution and laws. And they did all this in the absence of the far-right's most hated institution: democracy.

The results were exactly what liberals predicted.


Chile: the laboratory test


LOL

 

[Dad2three]

After all, it was 100% of GDP just a few years ago. The fact that 1/3rd of the economy is now private, when Raul Castro only came to power in 2008 and started those reforms.... that's a massive step towards Capitalism.

It was never 100% , that's a myth . There were allways hotels owned by foreigners : spanish mostly , as well as investments from Canada and Mexico. I'll do some research to find out the exact number.

That isn't what I have read. Doesn't mean it is not wrong. But what I've read is that prior to the early 90s, there were zero privately owned anything. Cuba was one of the very few countries that successfully banned all private ownership. Granted it didn't last long.

When the Soviets fell, Cuba was in an absolute disaster. In response, they allowed 'joint-venture' businesses. The joint part, was of course with the government. There are no 'private' resorts. There are Joint-Venture resorts that are owned largely by the government, with outside (typically Spanish) company partners.

The only other source of 'private' GDP, was self-employment, which the Cuban government allowed. But you were banned from hiring anyone as an employee. But as late as 1991, less than 5% of Cuba's GDP came from non-public non-government sources.

That's not surprising since being self-employed had limited applications. Can't really be a car mechanic, when you are not allowed to buy the parts, to fix the cars. Short of cutting hair, options for being self-employed were limited.

I found the "correct" number... in a blog: 94%... I am allways wary of absolutes: there is no place on earth with 100% free market or 100% government controlled production. Very close to 100% though.

PERIODO REVOLUCIONARIO (1980-1991) | Cultura Cuba

Arguing over Cuba when US policy has GREATLY destroyed their economy for 50+ years?

 

[EdwardBaiamonte]

After all, it was 100% of GDP just a few years ago. The fact that 1/3rd of the economy is now private, when Raul Castro only came to power in 2008 and started those reforms.... that's a massive step towards Capitalism.

It was never 100% , that's a myth . There were allways hotels owned by foreigners : spanish mostly , as well as investments from Canada and Mexico. I'll do some research to find out the exact number.

That isn't what I have read. Doesn't mean it is not wrong. But what I've read is that prior to the early 90s, there were zero privately owned anything. Cuba was one of the very few countries that successfully banned all private ownership. Granted it didn't last long.

When the Soviets fell, Cuba was in an absolute disaster. In response, they allowed 'joint-venture' businesses. The joint part, was of course with the government. There are no 'private' resorts. There are Joint-Venture resorts that are owned largely by the government, with outside (typically Spanish) company partners.

The only other source of 'private' GDP, was self-employment, which the Cuban government allowed. But you were banned from hiring anyone as an employee. But as late as 1991, less than 5% of Cuba's GDP came from non-public non-government sources.

That's not surprising since being self-employed had limited applications. Can't really be a car mechanic, when you are not allowed to buy the parts, to fix the cars. Short of cutting hair, options for being self-employed were limited.

I found the "correct" number... in a blog: 94%... I am allways wary of absolutes: there is no place on earth with 100% free market or 100% government controlled production. Very close to 100% though.

PERIODO REVOLUCIONARIO (1980-1991) | Cultura Cuba

Arguing over Cuba when US policy has GREATLY destroyed their economy for 50+ years?

100 stupid of course!! Communism is their policy not ours. Dumto3 thinks Cuban communism would have worked well just like it worked well for USSR Red China East Germany!!

See why we say stupid?? Is any other conclusion possible??

 

[Dad2three]

After all, it was 100% of GDP just a few years ago. The fact that 1/3rd of the economy is now private, when Raul Castro only came to power in 2008 and started those reforms.... that's a massive step towards Capitalism.

It was never 100% , that's a myth . There were allways hotels owned by foreigners : spanish mostly , as well as investments from Canada and Mexico. I'll do some research to find out the exact number.

That isn't what I have read. Doesn't mean it is not wrong. But what I've read is that prior to the early 90s, there were zero privately owned anything. Cuba was one of the very few countries that successfully banned all private ownership. Granted it didn't last long.

When the Soviets fell, Cuba was in an absolute disaster. In response, they allowed 'joint-venture' businesses. The joint part, was of course with the government. There are no 'private' resorts. There are Joint-Venture resorts that are owned largely by the government, with outside (typically Spanish) company partners.

The only other source of 'private' GDP, was self-employment, which the Cuban government allowed. But you were banned from hiring anyone as an employee. But as late as 1991, less than 5% of Cuba's GDP came from non-public non-government sources.

That's not surprising since being self-employed had limited applications. Can't really be a car mechanic, when you are not allowed to buy the parts, to fix the cars. Short of cutting hair, options for being self-employed were limited.

I found the "correct" number... in a blog: 94%... I am allways wary of absolutes: there is no place on earth with 100% free market or 100% government controlled production. Very close to 100% though.

PERIODO REVOLUCIONARIO (1980-1991) | Cultura Cuba

Arguing over Cuba when US policy has GREATLY destroyed their economy for 50+ years?

100 stupid of course!! Communism is their policy not ours. Dumto3 thinks Cuban communism would have worked well just like it worked well for USSR Red China East Germany!!

See why we say stupid?? Is any other conclusion possible??

Says little yellow bus Special Ed...

 

[Andylusion]

After all, it was 100% of GDP just a few years ago. The fact that 1/3rd of the economy is now private, when Raul Castro only came to power in 2008 and started those reforms.... that's a massive step towards Capitalism.

It was never 100% , that's a myth . There were allways hotels owned by foreigners : spanish mostly , as well as investments from Canada and Mexico. I'll do some research to find out the exact number.

That isn't what I have read. Doesn't mean it is not wrong. But what I've read is that prior to the early 90s, there were zero privately owned anything. Cuba was one of the very few countries that successfully banned all private ownership. Granted it didn't last long.

When the Soviets fell, Cuba was in an absolute disaster. In response, they allowed 'joint-venture' businesses. The joint part, was of course with the government. There are no 'private' resorts. There are Joint-Venture resorts that are owned largely by the government, with outside (typically Spanish) company partners.

The only other source of 'private' GDP, was self-employment, which the Cuban government allowed. But you were banned from hiring anyone as an employee. But as late as 1991, less than 5% of Cuba's GDP came from non-public non-government sources.

That's not surprising since being self-employed had limited applications. Can't really be a car mechanic, when you are not allowed to buy the parts, to fix the cars. Short of cutting hair, options for being self-employed were limited.

I found the "correct" number... in a blog: 94%... I am allways wary of absolutes: there is no place on earth with 100% free market or 100% government controlled production. Very close to 100% though.

PERIODO REVOLUCIONARIO (1980-1991) | Cultura Cuba

Which said black market, selling services and products illegal in the legal system.

Well of course if you include illegal activity, then yes, I agree. There is no 100% socialized system.

 

[Toddsterpatriot]

In the 1950s, Cuba had a standard of living closer to the US. From then, till now, the left has been screaming non-stop that the only reason Cuba is poor, the only reason they can't buy a new car, or or give aspirin to the ill, is all because of the embargo.

Shocking concept.

Interesting . Well , you will probably like to know that Cuba has been outperforming Mexico during the whole NAFTA period. Cuban embargo ,and Mexican mass migration and remittances notwithstanding.

gdp per capita ppp mexico | gdp per capita ppp cuba - Wolfram|Alpha

Shocking isn't it ?
Oh, but there's more... It actually outperformed the rate of growth of the USA.
While the per capita ppp income in America went from 24,000 in 1990 to 54,629 in 2014 or a factor of 2.27
Cuba's gdp per capita ppp went from 8,835 to 20,788 which is a factor of 2.35.

And that of course is just the per capita income , becuse household income has been stagnated for two decades.
So please , continue telling me of the benefits of free trade.

Why would that be shocking?

Cuba has moved towards free trade, and moved towards Capitalism.

We would expect that the economy in a severely depressed economy, would drastically improve. And the lower the wages are to begin with, the higher the jump will be.

You realize that in 2004, the average Cuban wage was roughly 14 Pesos a day. 27 Pesos is a US dollar. So most of them work for 50¢ a day in 2004. One international business is allowed to setup and operate in Cuba, paying $1 a day, and the per capita income is going to double for them.

Why anyone would be shocked that Cuba opening up markets would result in a sudden jump in GDP, is beyond me for sure. You should expect that. Everyone should.

Today the average income is 24 Pesos a day. That's a massive jump in average pay, in just 10 years.

And they have more trade, more economic freedom, private business, private land ownership. The liberalizing of the economy is paying huge dividends.

The BBC did a documentary on private business in Cuba just a week or so ago. There's a guy buying cars (illegal before), and buying imported parts (illegal before), repairing the cars and selling them for a profit (illegal before). Yeah..... dude wages and GDP is going to rise in Cuba.... and FAST.

That's Capitalism in action. Capitalism ALWAYS works. Every single time it's tried.

You talk as if central planning and regulations had disapeared from Cuba overnight and the embargo had been lifted 20 years ago. Cuba has embraced capitalism partialy ( as china did ) , but it does not embrace free trade ( how can it be called free trade with an embargo enacted )
Also notice :

"The top individual income tax rate is 50 percent. The top corporate tax rate is 30 percent (35 percent for wholly foreign-owned companies). Other taxes include a tax on property transfers and a sales tax. The overall tax burden is 24.4 percent of GDP. Government spending is around 67 percent of GDP, and public debt is around 35 percent of the domestic economy. Despite reforms, the government continues to play a large role in the economy"

I am sure most Americans would flinch at the perspective of having government in control of 67% of GDP.
There is a clear distinction between capitalism and the different shapes it takes like mercantilism and free trade ( which are opposed ) .

"Free trade is a policy followed by some international markets in which countries' governments do not restrict imports from or exports to other countries. Free trade is exemplified by the European Economic Area and the North American Free Trade Agreement, which have established open markets."

No, you just made that up. I never suggested anything like that.

My statement wasn't that ambiguous. I suggested that fast Cuban economic growth shouldn't be surprising because they are moving towards Capitalism, and away from Socialism. Every time any country does this, the result is ALWAYS fast economic growth.

I then gave a direct example from the BBC, illustrating my point.

Going from Socialism to Capitalism, or the reverse, is not like flipping a light switch off and on. It's more like a dimmer switch, that varies by degrees.

Cuba is moving towards Capitalism, and very fast. Even Communist China, required almost a decade of slowly allowing commune farms, to convert to privately run farms. Cuba has completely opened the door to private ownership, and private business, and profit based economics. Are there still some levels of socialized control? Of course. But like the BBC article showed, nearly everything that business owner did, was entirely illegal just a few years ago.

Yes Americans would flinch at 67% of the GDP being controlled by the government. But that makes my point, more than yours. After all, it was 100% of GDP just a few years ago. The fact that 1/3rd of the economy is now private, when Raul Castro only came to power in 2008 and started those reforms.... that's a massive step towards Capitalism.

The embargo is a non-event. Yes, it prevented US corporations from directly selling and buying from Cuba.... true. But it never stopped international traders from buying and selling in Cuba.

In fact, if you go to the tourist areas in Cuba, you can find name brands. Coke-Cola and beers and so on. How do they get there? Coke sells to Brazil, or some other country, and they sell to Cuba.

The embargo is almost completely irrelevant. The only real purpose the embargo has served, is to give the Cuban government an excuse for why their economic policies have utterly destroyed Cuba.

Cuban imports and exports have been increasing year over year since the 1990s. Top trading partners include Brazil, Mexico, Spain, China, Italy, France, Canada, and Germany.

The embargo was a bad policy designed to get votes, which never worked, and serves no purpose. But it is not an excuse for Cuba's bad economy. That is entirely due to their central planning socialistic policies that have ruined them.

ONE question, how'd Chile do under Uncle Milties "reforms"?


A Critique of the Chicago School of Economics:

CHILE: THE LABORATORY TEST

Many people have often wondered what it would be like to create a nation based solely on their political and economic beliefs. Imagine: no opposition, no political rivals, no compromise of morals. Only a "benevolent dictator," if you will, setting up society according to your ideals.

The Chicago School of Economics got that chance for 16 years in Chile, under near-laboratory conditions. Between 1973 and 1989, a government team of economists trained at the University of Chicago dismantled or decentralized the Chilean state as far as was humanly possible. Their program included privatizing welfare and social programs, deregulating the market, liberalizing trade, rolling back trade unions, and rewriting its constitution and laws. And they did all this in the absence of the far-right's most hated institution: democracy.

The results were exactly what liberals predicted.


Chile: the laboratory test


LOL

Thanks for the link.

The economy grew an astonishing 14 percent in 1936 — the strongest peacetime year in U.S. history. But does that mean that people were enjoying champagne and caviar during the Great Depression? Of course not. The economy was simply making up lost ground. Likewise, the U.S. recessions of 1980-82 were the worst since the Great Depression, and these were followed by an unusually strong seven-year boom: the so-called "Reagan years."

What's going on here? Two economic concepts are useful to understand this phenomenon. The first is that the economy grows in the long run, as both the population expands and each worker produces more per hour, thanks to improving technology and efficiency. This long-term growth experiences mild swings in the form of recessions and recoveries, of course. But if the economy grows in the long run, then deep recessions are going to be followed by even steeper recoveries.


So why was our recent deep recession not followed by a steep recovery?

 

[danielpalos]

Most liberals don't understand this because they don't really grasp the principles of free market capitalism. They react emotively and without thinking about consequences of what their emotions drive them to do. And when you're dealing with free market capitalism, this can be very costly because you can't put the toothpaste back in the tube. Such is the case with our beloved minimum wage.

Oh sure, it has been considered a wonderful idea through all the years... helped the poor exploited worker be treated at least half-way decently... but it has also produced a society full of idiots who don't comprehend how it has damaged the individual's ability to prosper. It's a big giant ball and chain on our ability to negotiate. In order to understand this, you must understand how the principles of free market capitalism (supply and demand) operate.

As I said, the toothpaste is out already, can't put it back now... So I am not suggesting we should get rid of the minimum wage at this time. Various reasons for that but it all goes back to the toothpaste already being out of the tube... we've already established a free market system around this baseline labor cost, any change now would be somewhat detrimental to a lot of people. The better idea at this point is to leave it alone and focus on making it irrelevant. Raising it is stupid and pointless because all you're ultimately doing is decreasing the value of a dollar.

But now... Let's go back to 1912, when this issue was first being debated. The First Progressive Movement was hell bent on establishing a minimum wage, at that time, for women and children. They tried numerous times to do this and kept running into failure because the Supreme Court continued to rule the minimum wage unconstitutional. This went on for over 20 years in the first part of the 20th century. So when we get to the Great Depression, FDR takes this opportunity to implement a national minimum wage. He says, and I quote:

"No business which depends for existence on paying less than living wages to its workers has any right to continue in this country."

Now...... THAT sounds very familiar, doesn't it? ....Where have I heard THAT recently? Can it not be clearer that this abysmal liberal policy has FAILED? Here we are, 82 years later and the same Progressives are screaming the same thing! The dollar amount is all that is different.

Same argument, same idea, same solution that hasn't worked in 82 years. But it's all about emotion, you see?

Okay, follow me here... think about, what if.... What IF we had not adopted a MW and instead, we promoted individual and collective bargaining? We could have established anti-trust laws where employers had to 'reasonably negotiate' with prospective employees on the specific job available. Of course, we have to understand there were "corporatists" back then who didn't want that to happen. They went along with this "minimum wage" idea because it effectively base-lined labor costs. Think about it for a hot second...

Every wage in America, whether you belong to a union or not, is pretty much determined in relation to the current minimum wage. If that goes up, so do all the wages up the ladder because that is their base line. As long as the minimum wage remains where it is, the motivation for the capitalist is to keep wages the same. so we've stagnated wealth acquisition by base-lining labor cost. You can't negotiate a higher wage because the wage is set according to the minimum you've set. Raising the minimum doesn't help you negotiate, it eliminates the job you're negotiating for. If there were no such thing as a minimum wage, you could negotiate based on market value of labor.

We don't know how free market forces would have worked the past 82 years... Sure, children and women were exploited back in 1912... Sure, people were struggling in 1933... but had we taken a different road, one that encouraged free market capitalism instead of trying to regulate it... we may have experienced a different result. It might be that today, an average worker negotiates $15 hr. for a burger flipper job because no one else wants to flip burgers? It might mean the value of the dollar never declined and $5 hr. buys as much as $15 today? We just don't know because we didn't take that road.

The Minimum-wage is just a tool being used by the left to advance Marxist principles.....and give low-information voters the feeling that Democrats really give a **** about them. At the same time new government regulations increase costs to businesses, and ever increasing excise-taxes raise the price of goods and services.

Raising the MW also raises overhead for businesses, which have to turn around and raise prices......which eventually creates inflation and causes a never ending cycle of government dependence. It's really just smoke an mirrors. Your paycheck never goes up in value because as your pay increases, so does your taxes. At the same time the cost of everything is going up....thus the value of that dollar is steadily shrinking.

No it isn't. It is a tool being used by the right advance capital principles over the more social, general welfare.

Why is there Any unemployment in our republic? If there are any alleged job openings, they must not be paying enough or welfare moochers would simply game that system instead.

 

[CultureCitizen]

You want to see innovation in America disappear? Just put in place massive protectionism. We can stay in stagnant isolation too. But at least no Hindustan Ambassador workers lost their jobs building a crappy poor handling weakly powered clown car from the 1950s. That's a 'good' thing right?

You are taking my statement out of context.
1) Competition is necesary period. I don't argue that.
2) That said , doing the average joe washington concensus neo liberal free trade agreement does not benefit the less developed economy.

3) As an alternative Asian countries have established a diferent model , allowing "limited competition", protecting certain industries by government intervention or by tariffs.
While this has prooved a great for nations in development , it has prooved the doom for the USA.
It is woefully miopic that 99% of the people I duscuss can't see the difference between 1 and 2.

4) Ultimately China's own excesive investment has created excesive production capacity and production at the cost of a gigantic private debt . That is a bubble which is about to burst ( I give it 1 year max).

5) You make a terrible mistake : you can't distinguish free trade with controlled trade. Nor China, nor Cuba nor SK followed a free trade strategy. In the first two cases the state remained a key element of the production for many years.
In the second infant industry was successfully protected by tariffs, this is also what the US made to avoid direct competition with the British Empire.

It does not benefit less developed economy? Then why is China benefiting? Why is India benefiting?

You are trying to make an argument, that the Chinese themselves are not making.

China FTA Network

The Chinese Government deems Free Trade Agreements (FTAs) as a new platform to further opening up to the outside and speeding up domestic reforms, an effective approach to integrate into global economy and strengthen economic cooperation with other economies, as well as particularly an important supplement to the multilateral trading system. Currently, China has 19 FTAs under construction, among which 14 Agreements have been signed and implemented already.​

So clearly they see it as a benefit.

No, the US protections failed miserably. If anything, industries behind protectionist walls, floundered, and remained undeveloped. (because they didn't have to develop).

"The premier said at the opening of the Third Session of the 12th National People's Congress, China will revise its Catalogue for the Guidance of Industries for Foreign Investment, which governs restrictions on investment from abroad, and make the service and manufacturing sectors more accessible"

Notice how investment is opened by steps and not in a rush. Big difference between Washington concensus and Chinese concensus. They've played their cards well.

China to reduce foreign investment restrictions[1]- Chinadaily.com.cn

 

[Toddsterpatriot]

You want to see innovation in America disappear? Just put in place massive protectionism. We can stay in stagnant isolation too. But at least no Hindustan Ambassador workers lost their jobs building a crappy poor handling weakly powered clown car from the 1950s. That's a 'good' thing right?

You are taking my statement out of context.
1) Competition is necesary period. I don't argue that.
2) That said , doing the average joe washington concensus neo liberal free trade agreement does not benefit the less developed economy.

3) As an alternative Asian countries have established a diferent model , allowing "limited competition", protecting certain industries by government intervention or by tariffs.
While this has prooved a great for nations in development , it has prooved the doom for the USA.
It is woefully miopic that 99% of the people I duscuss can't see the difference between 1 and 2.

4) Ultimately China's own excesive investment has created excesive production capacity and production at the cost of a gigantic private debt . That is a bubble which is about to burst ( I give it 1 year max).

5) You make a terrible mistake : you can't distinguish free trade with controlled trade. Nor China, nor Cuba nor SK followed a free trade strategy. In the first two cases the state remained a key element of the production for many years.
In the second infant industry was successfully protected by tariffs, this is also what the US made to avoid direct competition with the British Empire.

It does not benefit less developed economy? Then why is China benefiting? Why is India benefiting?

You are trying to make an argument, that the Chinese themselves are not making.

China FTA Network

The Chinese Government deems Free Trade Agreements (FTAs) as a new platform to further opening up to the outside and speeding up domestic reforms, an effective approach to integrate into global economy and strengthen economic cooperation with other economies, as well as particularly an important supplement to the multilateral trading system. Currently, China has 19 FTAs under construction, among which 14 Agreements have been signed and implemented already.​

So clearly they see it as a benefit.

No, the US protections failed miserably. If anything, industries behind protectionist walls, floundered, and remained undeveloped. (because they didn't have to develop).

"The premier said at the opening of the Third Session of the 12th National People's Congress, China will revise its Catalogue for the Guidance of Industries for Foreign Investment, which governs restrictions on investment from abroad, and make the service and manufacturing sectors more accessible"

Notice how investment is opened by steps and not in a rush. Big difference between Washington concensus and Chinese concensus. They've played their cards well.

China to reduce foreign investment restrictions[1]- Chinadaily.com.cn

Yeah, their house of cards is falling down, they need more foreign suckers to throw money at it. No thanks.

 

[CultureCitizen]

Yeah, their house of cards is falling down, they need more foreign suckers to throw money at it. No thanks

They've got about 3.5 T worth of t-bills to do that...
And they can still start the Yuan printing press if that's not enough.