Potential Solution to the Economy Problems

[KMAN]

Give anyone who bought a house $10,000 and lower the corporate tax rate to 10% for a year....

Can someone tell me why this wouldn't work?

 

[KMAN]

Anyone????

The 2 biggest problems we are facing is unemployment and the housing mess right?

So why are we trying to spend all of this money in this stimulus that doesn't relate to these 2 issues?

 

[Munin]

Anyone????

The 2 biggest problems we are facing is unemployment and the housing mess right?

So why are we trying to spend all of this money in this stimulus that doesn't relate to these 2 issues?

Wrong, unemployment is a symptom. When someone has got the fever and he gets high temperature then you don't throw a bucket of water over him to cool him down, do you?

The problem is the whole banking system (loaning money, ...) doesn't work properly anymore and the fact that nobody spends money anymore. The only thing that gets people spending again, is security over their jobs. This is only achieved when people buy things, for the moment we are into a negative circle: no people buying, less jobs needed -> more unemployed people, less employed people who spend and more employed people who don't want to spend because they re not sure they can have a job in the future -> ...

That is why if the government spends a lot of people will have stability (people are sure they will keep having their job because they are sure that the spending of the government will employ them indirectly), this will then again result in stability for other people (by the first people who begin buying like they would normally do when they have job stability): a positive circle that can break the negative one that we re in now if this positive one is strong enough (that is why the stimulus bill has to be so "big").


Making things cheaper is not the main solution, the main issue is people and their jobs (& the banking crisis): income stability, being able to rely on your income for the next couple of years. You won't buy something "expensive" (even with a reduction) if you could lose your job next week and if you know you probably won't get a new job so easy after that.

 

[driveby]

Give anyone who bought a house $10,000 and lower the corporate tax rate to 10% for a year....

Can someone tell me why this wouldn't work?

Not bad ideas imo, couple those with a cut in capital gains tax and i think things would get moving....

 

[Truthmatters]

It would still not be enough for many to keep their homes.

People would pocket it out of fear and not much would get back into the economy for a long time.

We need Stimulus people.

That is why the best use of the money is foodstamps.

It will keep people from getting into desperate situations and it returns 1.76 in stimulus for every dollar spent.

 

[KMAN]

Anyone????

The 2 biggest problems we are facing is unemployment and the housing mess right?

So why are we trying to spend all of this money in this stimulus that doesn't relate to these 2 issues?

Wrong, unemployment is a symptom. When someone has got the fever and he gets high temperature then you don't throw a bucket of water over him to cool him down, do you?

The problem is the whole banking system (loaning money, ...) doesn't work properly anymore and the fact that nobody spends money anymore. The only thing that gets people spending again, is security over their jobs. This is only achieved when people buy things, for the moment we are into a negative circle: no people buying, less jobs needed -> more unemployed people, less employed people who spend and more employed people who don't want to spend because they re not sure they can have a job in the future -> ...

That is why if the government spends a lot of people will have stability (people are sure they will keep having their job because they are sure that the spending of the government will employ them indirectly), this will then again result in stability for other people (by the first people who begin buying like they would normally do when they have job stability): a positive circle that can break the negative one that we re in now if this positive one is strong enough (that is why the stimulus bill has to be so "big").


Making things cheaper is not the main solution, the main issue is people and their jobs (& the banking crisis): income stability, being able to rely on your income for the next couple of years. You won't buy something "expensive" (even with a reduction) if you could lose your job next week and if you know you probably won't get a new job so easy after that.

I think we are saying the same thing regarding jobs... So why don't we give companies more of their own money back so they can hire more people?

 

[Truthmatters]

Because instead they give their CEOs huge parting bonusues

 

[KMAN]

It would still not be enough for many to keep their homes.

People would pocket it out of fear and not much would get back into the economy for a long time.

We need Stimulus people.

That is why the best use of the money is foodstamps.

It will keep people from getting into desperate situations and it returns 1.76 in stimulus for every dollar spent.

So, what you are saying is that even though the country is in debt we should spend more and create more debt???? So if I lose my job, I should hire someone to remodel my kitchen????? That doesn't make sense to me, but fine we'll increase foodstamps as well.... So why in the hell do we need a 400 page stimulus bill?

Regarding the housiong suggestion, I don't care how they spend their $10,000. I am trying to create some incentive for people to buy some of these foreclosed houses and take some pressure off the banks. If the banks get more money coming in they can loan more (but this time loan to responsible borrowers)

 

[editec]

I think we are saying the same thing regarding jobs... So why don't we give companies more of their own money back so they can hire more people?

Because that is not what the investment class had done with the enormous tax cuts they have gotten already.

What they did with it was not hire more people but invest it offshore or into government bonds.

The problem is not that the SUPPLE SIDE has too little money, (they've had too much for decades!) but that the rest of us (the demand side) have too little.

 

[KMAN]

Because instead they give their CEOs huge parting bonusues

If the workers of that company don't mind then that's their business. But if my company started doing things I didn't like I would find another job.

 

[Truthmatters]

What the fuck do the workers have to say about it?

They move to where?

All the companies on top were doing it.

 

[Munin]

Anyone????

The 2 biggest problems we are facing is unemployment and the housing mess right?

So why are we trying to spend all of this money in this stimulus that doesn't relate to these 2 issues?

Wrong, unemployment is a symptom. When someone has got the fever and he gets high temperature then you don't throw a bucket of water over him to cool him down, do you?

The problem is the whole banking system (loaning money, ...) doesn't work properly anymore and the fact that nobody spends money anymore. The only thing that gets people spending again, is security over their jobs. This is only achieved when people buy things, for the moment we are into a negative circle: no people buying, less jobs needed -> more unemployed people, less employed people who spend and more employed people who don't want to spend because they re not sure they can have a job in the future -> ...

That is why if the government spends a lot of people will have stability (people are sure they will keep having their job because they are sure that the spending of the government will employ them indirectly), this will then again result in stability for other people (by the first people who begin buying like they would normally do when they have job stability): a positive circle that can break the negative one that we re in now if this positive one is strong enough (that is why the stimulus bill has to be so "big").


Making things cheaper is not the main solution, the main issue is people and their jobs (& the banking crisis): income stability, being able to rely on your income for the next couple of years. You won't buy something "expensive" (even with a reduction) if you could lose your job next week and if you know you probably won't get a new job so easy after that.

I think we are saying the same thing regarding jobs... So why don't we give companies more of their own money back so they can hire more people?

Because companies won't hire more people if they get tax cuts because they can't sell their products. Companies are not investing because they can sell their products. If the government buys (spends), then companies have a reason to hire more people and to not fire people (because they cost too much if the company doesn't have any work: that is why factories are being shut down). And the people employed at those companies that have work will spend money on products because they have job stability, this way they can "stimulate" other companies which will then again lead them to hire more people.

 

[KMAN]

What the fuck do the workers have to say about it?

They move to where?

All the companies on top were doing it.

You don't understand that if one company is doing wrong things with their money that you need to switch companies???? I'm not sure how else to explain it...

Better yet, if you don't like the way a company spends their money stop using this companies services... If the company doesn't sell it's product it goes out of business...It's really quite simple...

 

[KMAN]

Wrong, unemployment is a symptom. When someone has got the fever and he gets high temperature then you don't throw a bucket of water over him to cool him down, do you?

The problem is the whole banking system (loaning money, ...) doesn't work properly anymore and the fact that nobody spends money anymore. The only thing that gets people spending again, is security over their jobs. This is only achieved when people buy things, for the moment we are into a negative circle: no people buying, less jobs needed -> more unemployed people, less employed people who spend and more employed people who don't want to spend because they re not sure they can have a job in the future -> ...

That is why if the government spends a lot of people will have stability (people are sure they will keep having their job because they are sure that the spending of the government will employ them indirectly), this will then again result in stability for other people (by the first people who begin buying like they would normally do when they have job stability): a positive circle that can break the negative one that we re in now if this positive one is strong enough (that is why the stimulus bill has to be so "big").


Making things cheaper is not the main solution, the main issue is people and their jobs (& the banking crisis): income stability, being able to rely on your income for the next couple of years. You won't buy something "expensive" (even with a reduction) if you could lose your job next week and if you know you probably won't get a new job so easy after that.

I think we are saying the same thing regarding jobs... So why don't we give companies more of their own money back so they can hire more people?

Because companies won't hire more people if they get tax cuts because they can't sell their products. Companies are not investing because they can sell their products. If the government buys (spends), then companies have a reason to hire more people and to not fire people (because they cost too much if the company doesn't have any work: that is why factories are being shut down). And the people employed at those companies that have work will spend money on products because they have job stability, this way they can "stimulate" other companies which will then again lead them to hire more people.

Maybe I am not understanding but it sounds like you are saying that is it good for the economy for the government to forcibily take more money from the people as a way to force them to spend instead of letting the people decide what to spend things on????

 

[Munin]

I think we are saying the same thing regarding jobs... So why don't we give companies more of their own money back so they can hire more people?

Because companies won't hire more people if they get tax cuts because they can't sell their products. Companies are not investing because they can sell their products. If the government buys (spends), then companies have a reason to hire more people and to not fire people (because they cost too much if the company doesn't have any work: that is why factories are being shut down). And the people employed at those companies that have work will spend money on products because they have job stability, this way they can "stimulate" other companies which will then again lead them to hire more people.

Maybe I am not understanding but it sounds like you are saying that is it good for the economy for the government to forcibily take more money from the people as a way to force them to spend instead of letting the people decide what to spend things on????

In this specific case: yes. But this doesn't mean you have to raise taxes, you just pay it with taxes the government will receive over the next years (because a good economic situation also means more income, the investment the government does now will be rewarded by more tax-income when the economic situation improves: more employed people, businesses making more profits = more tax-income). The government needs to do spending (because nobody in the private sector is spending) that will inject money into the private businesses that are employed by it, they on their turn can use the money for investments and the workers can use it to stimulate other businesses.

But normally I d say this is not good to let the government spend money instead of taxpayers (except for some specific cases: schools, police, military, infrastructure, ... where you need the government), I too support the principle of free market but only in cases where it is possible and not morally wrong (like in the case of the military: f.e. blackwater ).

Why do you think major investors like Warren Buffet would vote for Obama? Do you think it is because he likes big government or something? No, it is because he has enough economic intelligence to see that the working people are the engine of the economic system.

That is why other things that help the working people also help the economy: healthcare which in the first instance doesn't look like it has something to do with economy actually is very important to the economy. Healthy people can work better, are more efficient so an economy with more healthy people will in the long run always be better then one with an unhealthy population.

 

[auditor0007]

Give anyone who bought a house $10,000 and lower the corporate tax rate to 10% for a year....

Can someone tell me why this wouldn't work?

Lowering the corporate tax rate will not create more jobs. Until people have money in their pockets to spend, producing more goods is out of the question. This is the reason companies are laying people off; because they aren't selling anything. Cutting their tax rate will not increase spending by consumers.

As for giving anyone who bought a house $10,000, why not just give everyone $10,000? The answer is the same as why we shouldn't be supporting this unstimulus bill. It ain't free; we're eventually going to have to pay for it. So, if we don't get something tangible in return, it's just wasting our own money.

Now, if all the money was put into infrastructure, we would actually get something tangible in return, so you could argue that it was money well spent. Anything outside of that is a farce.

 

[KMAN]

Because companies won't hire more people if they get tax cuts because they can't sell their products. Companies are not investing because they can sell their products. If the government buys (spends), then companies have a reason to hire more people and to not fire people (because they cost too much if the company doesn't have any work: that is why factories are being shut down). And the people employed at those companies that have work will spend money on products because they have job stability, this way they can "stimulate" other companies which will then again lead them to hire more people.

Maybe I am not understanding but it sounds like you are saying that is it good for the economy for the government to forcibily take more money from the people as a way to force them to spend instead of letting the people decide what to spend things on????

In this specific case: yes. But this doesn't mean you have to raise taxes, you just pay it with taxes the government will receive over the next years (because a good economic situation also means more income, the investment the government does now will be rewarded by more tax-income when the economic situation improves: more employed people, businesses making more profits = more tax-income). The government needs to do spending (because nobody in the private sector is spending) that will inject money into the private businesses that are employed by it, they on their turn can use the money for investments and the workers can use it to stimulate other businesses.

But normally I d say this is not good to let the government spend money instead of taxpayers (except for some specific cases: schools, police, military, infrastructure, ... where you need the government), I too support the principle of free market but only in cases where it is possible and not morally wrong (like in the case of the military: f.e. blackwater ).

Why do you think major investors like Warren Buffet would vote for Obama? Do you think it is because he likes big government or something? No, it is because he has enough economic intelligence to see that the working people are the engine of the economic system.

That is why other things that help the working people also help the economy: healthcare which in the first instance doesn't look like it has something to do with economy actually is very important to the economy. Healthy people can work better, are more efficient so an economy with more healthy people will in the long run always be better then one with an unhealthy population.

I hear what you are saying, I just don't agree that other people should pay for me to get a job. Remember the government doesn't make money... they take from others and pass it out as they seem fit.

 

[Munin]

Maybe I am not understanding but it sounds like you are saying that is it good for the economy for the government to forcibily take more money from the people as a way to force them to spend instead of letting the people decide what to spend things on????

In this specific case: yes. But this doesn't mean you have to raise taxes, you just pay it with taxes the government will receive over the next years (because a good economic situation also means more income, the investment the government does now will be rewarded by more tax-income when the economic situation improves: more employed people, businesses making more profits = more tax-income). The government needs to do spending (because nobody in the private sector is spending) that will inject money into the private businesses that are employed by it, they on their turn can use the money for investments and the workers can use it to stimulate other businesses.

But normally I d say this is not good to let the government spend money instead of taxpayers (except for some specific cases: schools, police, military, infrastructure, ... where you need the government), I too support the principle of free market but only in cases where it is possible and not morally wrong (like in the case of the military: f.e. blackwater ).

Why do you think major investors like Warren Buffet would vote for Obama? Do you think it is because he likes big government or something? No, it is because he has enough economic intelligence to see that the working people are the engine of the economic system.

That is why other things that help the working people also help the economy: healthcare which in the first instance doesn't look like it has something to do with economy actually is very important to the economy. Healthy people can work better, are more efficient so an economy with more healthy people will in the long run always be better then one with an unhealthy population.

I hear what you are saying, I just don't agree that other people should pay for me to get a job. Remember the government doesn't make money... they take from others and pass it out as they seem fit.

The government creates the situation in which people are able to make money, so in essence they are the reason for the creation of money: they are responsible for the creation of the road between the factory were goods are produced and the marketplace (also created by the government) were the goods are bought & sold.

You seem to think that a company makes money out of nothing, while you forget the electricity-network, water-network, road-network, internet-network, ... that are part of the reason why this company exists and why it operates so good.

People were making money before there were even companies, you seem to forget that. The government always created the situation were it was possible to make money, the first most prosperous economies were created by the government ( f.e. the Roman empire: creation of roads, new cities, new mines, ... ).

A good economy is always run by a government because the economy exists out of independent players (companies, consumers) that need to be connected to each other and need to be controlled by laws, ... in order to work as efficient as possible. Of course not all laws are efficient.