Interesting. I'll take a look into it.Originally Posted by Sanford
Actually, kid, this may surprise you, but I heard that MORE people protested against Pap Bush's war then are protesting now.
Just be sure you don't believe everything you hear from...
Authoritarian Opportunists Who Cozy Up To Genocidal Dictators - for Peace
nice condescension, btw. but that's not the way i remember it at all. in fact, in minneapolis, where i was living at the time, anti-gulf war protests were actually taken over by pro-gulf war counterprotesters, who had far greater numbers.
i'm not sure if this happened elsewhere, but in my corner of the world, it was quite a popular war.
TK
Very interesting, Sanford. Since the site you link to in your next post indicates that:Interesting. I'll take a look into it.Actually, kid, this may surprise you, but I heard that MORE people protested against Pap Bush's war then are protesting now.
{emphasis mine}For these reasons, as well as Workers World's poor track record of relations with other groups, some people refuse to attend A.N.S.W.E.R. events, including the January 18 anti-war protest
Hmmm... The protests on the 18th were pretty sizeable (100K in DC, 20K in Portland, etc) and a nontrivial number of antiwar folks refused to attend, solely out of disdain for the package-deal of the organizers. . .
Hmm...
"Qu'est-ce que c'est que cela, la loi ? On peut donc être dehors. Je ne comprends pas. Quant à moi, suis-je dans la loi ? suis-je hors la loi ? Je n'en sais rien. Mourir de faim, est-ce être dans la loi ?" -- Tellmarch
"Человек не может снять с себя ответственности за свои поступки." - L. Tolstoy
"[it] is no doubt obvious, the cult of the experts is both self-serving, for those who propound it, and fraudulent." - Noam Chomsky
Yellow ribbons everwhere.
I remember attending a State School Board Convention a day before the Congressional vote on the Gulf War. The entertainment for the convention was all military, and you felt very uncomfortable if you voiced any doubt.
The keynote speaker was a representaive of the Bush I Administration. He gave a patriotic talk about the impending war. He said nothing about Education, the reason why we were all there.
Of course this was Utah, and many of our citizens belong to the National Guard. But this time around, discussion, debate, and dissent, are being tolerated.
"To announce that there must be no criticism of the president, or that we are to stand by the president right or wrong, is not only unpatriotic and servile, but is morally treasonable to the American public." -- Theodore Roosevelt
Remembering '91
This was also true in my corner of the world. '91 was a very popular war. People here seemed disappointed that Bush the 1st did not finish the war.
There were no organized protests, although the guy my kids call "the naked hippie" did faithfully show up with a sign outside the Truman gate of KAFB while the military people and the Sandia Lab civilians were going to work every day. There were a few very small candlelight vigils. I was in grad school at the time and I do recall a few people showing up in black to class the day the war started.
I recall more protest over the sanctions later than over the war itself. The protests over the sanctions were pretty small though, it was a matter of 20 -30 of the same people showing up over and over. (Hey--you're here again!).
Elisheva Levin
"It is not up to us to complete the task,
but neither are we free to desist from it."
--Pirkei Avot
Few protested Clinton's bombing of Iraq and of Serbia because the public was not interested in public events, and were totally content to leave it up to the government.Hmmm, I guess the key is for Bush to get the American people to not "trust the government in Washington to do what is right," then they will be "totally content to leave it up to the government" to bomb Iraq.
Makes sense to me. :wink:
Suz X:
Sorry for the delay; I didn't notice this post when you first entered it.
While that is true, it cannot be our only consideration. Property rights are indeed properly curtailed to protect rights of person or other people's rights of property. But they may also be curtailed in order to protect the commons and ensure proper husbandry of resources. Environmental regulations are all about that.Society is a collection of individuals, each of whom possess inherent rights of person and property.
We can, I suppose, think of this in terms of protecting the rights of person and property of future generations, but that's a bit cumbersome.
Not at all. Inflation is finite; it has a measurable quantity. Regarding wages, or prices or any other economic measure of value, the only effect of inflation is to require a percentage adjustment between one time and another.Higher wages become meaningless in an inflationary economy.
Quite proper to put that "amen" at the end, because what you have presented here amounts to a religious belief. There is a logical flaw in it.?Wealth at the top? translates economically as cash reserves, which functions as investment capital, which drives innovation, which creates employment, which fuels productivity, forever and ever amen.
Cash reserves do not necessarily function as investment capital. That's only true at the discretion of those who own them. Whether the owners invest their cash reserves in productive, job-creating business, or in such non-productive, non-job-creating things as gold, furs, art, vacation homes, antiques, etc., depends not on how much cash is reserved but on how much demand exists for the goods and services produced by job-creating businesses.
How much demand exists for those goods and services depends, in turn, on how much cash people have in their pockets. It depends more, therefore, on how much money is available in the middle and lower ranks of the economy, than how much is available at the top.
"Unregulated" in my sentence was a modifier only for capitalism, not socialism. Unregulated capitalism is one extreme, and socialism is another.Just for fun, try defining ?unregulated socialism.?
************************************************** **************
What Brian Rush described could be called "trickle up." I believe this was the situation during the last High, which was an economic boom period.
Brian Rush:
Thank you so much for your time and consideration. I didn't notice a delay as I don't browse here 24/7, so no need to apologize.
Cumbersome? Perhaps, but I think you're on to something. The notion of protecting future propery rights is, IMHO, ethically and morally valid.
You really are just a loveable little fuzzball, aren't you? :wink:
Are you aware of any torts or precidents on the books that support that argument in law?
Mr. Rush, that argument smacks of class envy. But more to the point, all of the "non-productive, non-job-creating things" you mention are, in fact, productive and job-creating. Somebody has to produce and/or distribute all of the items you mention. People are hired and paid to do so, hence jobs are "created." It is also worth noting that the very rich are usually not so unwise as to bury their capital in the backyard in the form of currency. Any wealth over and above what they can actually spend on lifestyle is invested at some level in the economy. Even the funds in a simple savings account at the local bank are used as investment capital each time that bank sells a small business or mortgage loan. That transaction in turn creates more jobs.
Which leads us right back to how much capital is available, in the form of loans at the local bank, and how the rate of interest the bank must charge for those loans affects the borrower's ability to afford it. Inflation typically drives interest rates up, thus making capital less affordable to the middle and lower ranks of the economy. So inflation does very much matter, IMO. Simply increasing wages would make no difference at all to the economy as a whole. Prices would just increase.
Suppose you could take, say, 50% of all cash reserves from the wealthy and distribute it to the poor. You would create a very short-term economic stimulus in the form of a retail spending spree. That capital would still very soon find it's way back into the portfolios of the rich. And if you did that repeatedly, how long would it be before nobody bothered to be productive enough to become wealthy in the first place?
I'm quite sure you and Paul Hawkin have a solution to this conundrum. The problem, though, is that socialist economic solutions have, thus far anyway, never managed to override the intractable nature of life:
competitive advantage is hardwired into this universe, whether it meets with our moral approval or not.
I'd love to know if you are aware of any specific legal precidents supporting the property rights of future generations. That's a can of worms I've never seen opened, even by my former Libertarian bretheren. (and, yes, Libertarianism is more religious cult than political party. That's why I reduced my L to l.) 8)
--Suz X
On the contrary, I recall them quite well.
Actually, at that time you were right. Had a serious threat of regime change arisen in, say, 1982, it's highly likely the bombs would have been used. Exactly who the target would have been would have depended on the details of the circumstances.
The idea being floated to sell the Iraq War is that Saddam is a great threat to the US should he get WMD. Twenty years ago, this same idea was advanced about the Russkies, who ALREADY had WMDs, lots of them, pointing at us. The Russkies were an evil empire, far worse than the axis of evil in terms of the threat they posed. It was universally believed by conservatives (and some liberals such as myslef) that the Commies in Russia would use their WMDs if threathened with regime change. I believed this myself. Well we were wrong, the Commies went down w/o firing a shot.
The reason the Commies went down quietly was because the collapse came from within the lower ranks of the Communist Party, as well as from the general public. Communism, the organizing pseudo-religion of the USSR, had lost whatever hold it had ever had on the public mind. In fact, it had done some some time before, but Gorbachev, by trying to 'loosen' the grip, revealed that the regime was vulnerable. After that, it was only a matter of time.
Depends on what you mean. I knew then that they feared our firepower, it's what prevented them from attacking us. And yes, if they could have conquered the West, they would have. Let us have no illusions about that.
Now that the Cold War is over, it has been revealed what we covertly knew about the Russkies. We knew they were as afraid of us as we were of them and that both of us were mightily deterred from that final dance. But that is not how it was sold to the American people then. It was not what I believed (I tend to be conservative in foreign policy matters). I based my views on the publicly-available data, which didn't tell a complete story.
The leaders of the USSR were ruthless, and in their earlier phases ideologically driven. The later ones tended toward a ruthless pragmatism, and might have been content with simply rending the West helpless (again, if they could have done it).
Did they fear an attack from the U.S.? I don't doubt it, Russia had been attacked by the West on previous occasions. That doesn't conflict with the fact that Soviet Communism was itself an aggressive ideology. For that matter, the possibility of preemptive attack was always maintained by the United States to be a theoretical option throughout the Cold War, if it was perceived as necessary to cut off an attack from the USSR. 'Preemption', as a doctrine, is nothing new.
No, it's not obvious at all. Nor is it obvious that he was closer to possessing nuclear weapons in 1990 than now. It might be true, but it's far from a certainty.
The same situation hold true of Iraq today. The idea of WMDs falling into Saddam's hands is being employed as the reason for this war. I don't buy it at all. First of all, he has been trying to get them for 25 years and was closer to it in 1990 than today (since he had a free rein to act then). If WMDs and Saddam were a real threat we would have taken out Saddam in 1991. This is obvious.
Again, that doesn't necessarily prove much. N. Korea is not near the major oil production regions, it doesn't border Israel, it doesn't border Saudi Arabia, and much of Europe is not (yet) within its strike range. I suspect that if N. Korea continues on its current course, the apparent unconcern with also alter. Note the location where there is talk of deployment of missile defenses. (Whether they'll work is a separate question from where they are being suggested for deployment).
And the general issue of WMDs in the hands of evil dictators is shown by our tepid reaction to North Korea, who probably has several bombs and the means to deliver them. Washington isn't particularly concerned.
There wasn't actually all that much 'coalition' to the coalition. Gulf War I was mostly America and Britain. Much of the coalition was for show. No question Bush I screwed up, badly, especially with regard to the insurrections they stirred up and then ignored. A major mark against them.
No, the real problem is terrorism. The solution the Bush adminstration has come up with is the WOT. This is not a shooting war (although military means are employed at times), but rather a "moral equivalent of war" like the War on Drugs. (A lot of the insider details for the Bush adminstration here I got from the recent book Bush at War--its fascinating--I highly recommend it). The analysis is my own.
Saddam is not (mainly) a threat to us because he might supply terrorists with WMD. He is a threat to us because of the embargo. Bascially the first Bush adminstration screwed the pooch. They left Saddam in power, but then boxed him in so tightly that he couldn't directly threaten anyone. The idea was that he would be so humiliated that he would lose support and be overthrown. Well it didn't work. Eleven years later he was still there, and still boxed in so we can't get another coalition to take him out like we did in 1990 (this was the situation before 911).
It's very hard for me to work out any near future scenario that lets us withdraw all our troops from the Middle East, Saddam or not. I don't like that, but I can't see one. As for terrorism, any plausilble WOT has to involve the state sponsors. The question is the exact ties to which states.
As a result we have troops in Saudi Arabia, and tens of thousands of innocent Iraqi's have died as a result of the embargo. These facts serve as a focusing point for Arab resentments (lots of these--read about the post-WW I Middle East and you will see the origin of much of it). We need to get out troops out of Saudi Arabia and end the goddam embargo. But we can't do either as long as Saddam is still there. So he's gotta go. These issue were brought to VERY clear focus by 911. My first thought was "we are at war" when I heard about the attack. So was the President's. I then went on to think about other things. The President did not, he's can't, its his job to keep thinking about it.
Incidentally, Stonewall is at least partly right about the PR activities of Bush II being somewhat disingenuous. Bush said in his campaign during E2K that he favored regime change in Iraq, I suspect that even without 911, there's a chance we'd be mixing it up on some level with Iraq now. But 911 certainly intensified everything.
I don't doubt that.
Right after 911, the adminstration brought up the issue of let's hang 911 on both Saddam and UBL and go after Iraq now. This was what I thought we should do, and Rumsfeld favored this approach. But Cheney (the #1 hawk) wouldn't support him. Powell was opposed and so was Tenet, so it went down in the vote and Bush took it off the agenda for now. Thus the immediate military response was solely against Afghanistan.
But there was a major CIA offensive worldwide. There are many regimes who bad mouth the US publicly, but who closely co-operate with our government behind the scenes. It is no accident that there have been no further terrorist attacks. They have been decimated by the covert WOT.
Actually, I suspect you're not too far off the mark here. But keep in mind that there is a time limit. Once the forces are in place, they can't be kept there, in combat readiness, indefinitely. One way or another, the clock is ticking down.
Most of this is secret, but the Afghanistan operations has been partially revealed. The CIA was in there almost right away, with an extremely potent weapon--suitcases full of cash. The first Taliban losses were the loss of 1400 troops through defection effected by a CIA bribe, before the bombs had even started to fall.
Once the bombs started it got even more intense. One warlord was offered $50,000 to turn sides. he said he wanted to sleep on it. So the Air Force dropped a bomb right next to his HQ to help "focus his mind". The next day he settled for $40,000.
In all some $70 million of CIA cash was spread arround, where, with the additional "persuasion" of US smart munitions, the Taliban lines were perforated and then collapsed, and the Northern Alliance poured through. At the time the Taliban fell there were only some 300-400 US troops in Afghanistan. Today they are some 7000.
Last spring the CIA went into Iraq with more suitcases.
A successful "war" in Iraq would see Saddam resign and go into exile. The suitcases are there. Now some "mind-focusing" persuasion is needed. Bush must reprise his wild-ass cowboy unilateralist role to "help focus Saddam's mind". And if he refuses to budge then he is going to have to go in there, not just with targetted munitions, but "boots on the ground". (My understanding is there are already some 300,000 boots in the region). There may be no other way to dislodge the sonofabitch.
Suz X:
I'm afraid not. As the law stands, future generations have no rights, as they are not existing persons.Are you aware of any torts or precidents on the books that support that argument in law?
As my own household income is well into the six-figure range, I hardly think so.Mr. Rush, that argument smacks of class envy.
Yes, but here the investor is behaving, with respect to job creation, as a consumer rather than an investor. Funding a startup, investing in new plant, or even buying stocks in an expanding company, all create far more jobs than buying gold or artwork. All investments are not equal for purposes of sharing wealth or enhancing a society's real wealth, any more than all investments are equal in terms of return.But more to the point, all of the "non-productive, non-job-creating things" you mention are, in fact, productive and job-creating.
No, and the present economic doldrums, conjoined with the lowest interest rates in decades, illustrate that fallacy. There is no shortage of capital to invest at this time. It is not being invested solely because potential investors don't see prospects of good returns. Too many people are out of work, consumers are too uneasy and unwilling to spend, and on a global scale the imbalance between productivity and wages is attrocious, so that the workers who produce the world's manufactured goods are mostly unable to buy them. Businesses created under these conditions will likely fail.leads us right back to how much capital is available, in the form of loans at the local bank, and how the rate of interest the bank must charge for those loans affects the borrower's ability to afford it.
That is why Bush's tax cuts, targeted at the top of the scale, will not work as an economic stimulus. They will increase the availability of capital when capital is already available in surplus, and when what needs to be stimulated is consumer resources not producer resources.
The U.S. economy demonstrated otherwise in its golden age, during this saeculum's First Turning and about halfway through its Second Turning. (I.e., the late 1940s until the early 1970s.) The structural changes made to the economy, including the new dominance of organized labor and a more labor-friendly government, increased wages, and although prices did rise they did not rise nearly enough to wipe out the gains. This period also saw the fastest economic growth and the healthiest economy in U.S. history.Simply increasing wages would make no difference at all to the economy as a whole. Prices would just increase.
Since then, partly due to political shifts but mostly because of globalization, the process has reversed. American real wages have trended downward, while the manufacturing labor used by U.S. companies has plummetted in compensation as those jobs have been exported to developing countries with governments that impose harsh labor conditions worse, if anything, than industrial-revolution-era Britain or America. And economic performance has not been nearly as good.
Well, that's not really the way to go about it. What we need instead are systematic structural changes in the way the global economy is organized, so that the price of labor rises; also we need to revamp our tax structure so that it burdens the wealthy more and the middle class less.Suppose you could take, say, 50% of all cash reserves from the wealthy and distribute it to the poor.
A lot of the problem lies overseas. Because there isn't a level playing field in terms of labor and environmental rules, our investors can ship their money to countries where the government actively cracks down on union organizing and otherwise suppresses the rights of labor. Naturally they tend to do this by preference where other factors such as language and available infrastructure don't outweigh the benefits of employing virtual slaves. As this drains investment capital away from the U.S., it also drives down American wages, although not as dramatically.
But the shift in tax balance begun in the Reagan years also plays a part. By cutting the progressive income tax while raising the regressive payroll tax, Congress during those years (and following Reagan's directive) raised the net taxes paid by middle-income taxpayers, thus cutting the consumer purchasing power that keeps the economy afloat.
We're paying for all of these maldistributive structural errors. If they were corrected, then the working of supply and demand would restore the prosperity of the 1950s and 1960s (always assuming we could deal with the concurrent resource and environmental problems), without need to resort to such clumsy direct transfer payments as you postulate. Because it was exactly such a restructuring, arising from the previous Crisis, that caused the prosperity of those years.
As I said earlier, unregulated capitalism and [no adjective] socialism are extremes. We have other options. Managed-market capitalism has proven itself far superior to either free-market capitalism or Soviet-style socialism. Why, then, would we want to undertake either of those extreme options?problem, though, is that socialist economic solutions have, thus far anyway, never managed to override the intractable nature of life
This is a example of the classical "supply-side" or traditional economic view versus the "demand side" or Keynesian view.Cash reserves do not necessarily function as investment capital. That's only true at the discretion of those who own them. Whether the owners invest their cash reserves in productive, job-creating business, or in such non-productive, non-job-creating things as gold, furs, art, vacation homes, antiques, etc., depends not on how much cash is reserved but on how much demand exists for the goods and services produced by job-creating businesses.
How much demand exists for those goods and services depends, in turn, on how much cash people have in their pockets. It depends more, therefore, on how much money is available in the middle and lower ranks of the economy, than how much is available at the top.
Both are wrong, and right, in their own ways.
The key error in the first is the idea that "investment capital drives innovation". It does not in general. Investment capital is needed for innovation, but unless it is limiting, its availability does not control the rate of innovation. Supply-siders tend to assume that the pool of potential innovations is infinite, and that all that is needed to produce enhanced innovation and growth is investment. Thus, efforts to increase the pool of investment funds will increase innovation and long-term growth.
The experience of the last 20 years shows that freeing up enormous quantities of capital has not resulted in a surfeit of new innovation and growth opportunities. Rather what has happened was a massive quantity of investment funds have bid up the price of the few innovations available to astronomical levels (i.e. the tech bubble).
In actuality the rate of innovation-driven growth is usually limited by the rate of innovation, not the availability of investment capital.
The key error in the second argument is that the rate of formation of new investment opportunities depends on how much demand exists for the goods and services produced by job-creating businesses. This argument is true enough in itself when applied to "normal investment", that is investment applied to already-existing sectors of the economy.
And there is no doubt about this issue today amongst economic authorities, right or left. There is adequate demand in our economy today, funded in part by massive infusions of cash from mortgage refi. This in turn has helped keep employment up and wages growing, which provides a second support for demand. The principal sickness in our economy today is anemic "new innovation" investment in the face of a huge surfeit of investible funds.
Long-term growth requires investment in enterprises associated with the creation of new economic sectors (what I call innovation and what has been popularly called "the new economy"). Keynesian analysis ignores this component. Suz X does address it in her statement, but makes the incorrect assertion that it is limited by availability of investment funds.
How best to encourage formation of new economic sectors is a key issue of this crisis, IMO, which so far has been completely under the radar. Interestingly, this process appears to follow the saeculum.
Creativity and the Economy
Jacques Barzun has commented that we have been living off the ideas of the era 1870-1920, and have not done much that is demonstrably independent of that time. Even computers and the Internet are simply combinations of that technology.
To stimulate the economy we need imaginations that either find new combinations of this previous technology, or create new technologies that go beyond them.
The quantum computer, nanotechnology, biotechnology, etc. are all here, or just about here, but how many people are employed, can be employed, in such areas? And how many ancillary positions on lower levels can be created?
An enhanced space program with an independent U.S. space station at 22,000 miles in geosynchronous orbit, leading to bases on the Moon and exploration of Mars and the moons of Jupiter, would also fire up the imaginations of our young people. This would no doubt lead to advancements and new products in many areas just like the Apollo Project did. The optimism would also counterbalance the pessimism in the atmosphere right now.
And yet what about imagination for creating non-technological employment? Our solution for employing the lower classes has been to send them to Burger School or Drain-Cleaning School or just to write them a welfare check. Not very imaginative! Not every average or below-average American can be employed in technology, or wants to be. What will they be doing in 10, 20 years?
There would seem to be a good number of possibilities in environmental clean-up, recycling, etc. for such people. "Mining" old dumps for usable materials, attacking chemical dumps, reforestation projects, etc. would be labor intensive, would not necessarily need a college degree, and would promote personal satisfaction and the general health of the population. Many people presently losing their jobs to robots or Chinese slave labor could be employed in this manner.
Evidence of the 4T, I largely agree with Brian Rush's economic analysis above. I might tend to try to level the playing field on labor and environmental regulation (and not be so quick to drive companies out of the country), rather than restricting the flow of capital, but I also look forward to a big time boycott of China as necessary to a world economic restructuring. So that is not very free trade of me is it. On the other hand, I don't know how anyone in the midwest can have watched jobs flow to China without having doubts about free trade and the conditions that the Chinese work under.
Bullcrap. Someone is employed to mine the gold, process the gold, manage the functioning of a gold business; in addition, gold mining and processing (not to mention delivery of the stuff itself) requires a constant supply of capital equipment -- all of which must be built and maintained by people with jobs. At the same time, artwork (let's say a painting, for the sake of argument) employs the painter, the paint makers and canvas makers, the brush makers, and those who build and maintain the machinery involved in fabricating these implements.
Eventually, this money spent on gold or art makes its way to the hands of those who value a marginal direct capital investment more than the marginal liquidity or consumption they forego by investing. The capital created somewhere upstream of the guy who buys a painting or antique or whatever most certainly does end up increasing the general stock of humanity's capital -- and thus leading to generally improved prosperity and employment. The big picture is not simply important; it is fundamental.
"Qu'est-ce que c'est que cela, la loi ? On peut donc être dehors. Je ne comprends pas. Quant à moi, suis-je dans la loi ? suis-je hors la loi ? Je n'en sais rien. Mourir de faim, est-ce être dans la loi ?" -- Tellmarch
"Человек не может снять с себя ответственности за свои поступки." - L. Tolstoy
"[it] is no doubt obvious, the cult of the experts is both self-serving, for those who propound it, and fraudulent." - Noam Chomsky
"but I also look forward to a big time boycott of China as necessary to a world economic restructuring. So that is not very free trade of me is it."
Nope. And a salary of two pennies a week is also fairly relative (aren't liberals supposed to "moral relativists"?). Guilt can be a heavy taskmaster and while you may get a thrill smashing your "Made in China" mug into the fireplace, along with it (and into the fire) goes those two pennies. And now what's the Chinese worker got? Nuttin', zip, zero nadda!
Feeling "the pain" of other, as Clinton proved, often makes one feel good. Until, that is, the pain becomes real. Is there anything wrong with letting the Chinese decide when to feel their own pain? Hmmm?
Actually, the Chinese worker already has the two pennies (or whatever meagre fraction his masters allow him to keep). All you've done is wreck a perfectly good mug. Now you have to go buy another. The time you spent earning the money you spent on the mug is gone forever, with naught but shards to show for it. :cry:
One more thought on this silly arrogance toward the poor Chinese workers: Try to imagine how stupid it would've been to have had the French start a "big time boycott" of the English colonies because of the way they were being treated by the British. What a joke, huh? :wink:Actually, the Chinese worker already has the two pennies (or whatever meagre fraction his masters allow him to keep). All you've done is wreck a perfectly good mug. Now you have to go buy another. The time you spent earning the money you spent on the mug is gone forever, with naught but shards to show for it. :cry:
Mike Alexander said:
I disagree both that this is the principal sickness in our economy (though undeniably it is one serious problem), and that this investment is not demand-driven. It is true that demand for new and innovative products and services is speculative rather than established. But it is also true that the level of demand in general, for existing products, is crucial to determining the mood of investors and thus how much venture capital will be made available to innovators.There is adequate demand in our economy today, funded in part by massive infusions of cash from mortgage refi. This in turn has helped keep employment up and wages growing, which provides a second support for demand. The principal sickness in our economy today is anemic "new innovation" investment in the face of a huge surfeit of investible funds.
Put simply, people will try innovative products to the extent they have ready cash available and feel secure enough to spend it. If anything, this market is even more driven by such factors than are the more mature sectors of the economy.
I also have a problem seeing how "massive infusions of cash from mortgage refi" have kept "employment up and wages growing," in view of the fact that employment is down and real wages shrinking. Surely there's no need to seek the cause of a nonexistent effect.
Justin said:
Et cetera. Numbers, Justin. Numbers matter. Buying gold doesn't produce anything like the level of employment or collective wealth that investment in industry does. Yes, it produces a nonzero amount, but a relatively trivial one by comparison. Especially since gold is not a usable product, except for jewelry purposes.Bullcrap. Someone is employed to mine the gold
Monoghan:
While I agree with the overall idea of leveling the playing field, rather than lower ourselves to the level of barbarians why don't we try to encourage the barbarians to become civilized, by conditioning favorable trade relations on civilized behavior? It really isn't improving matters to make America another Indonesia.I might tend to try to level the playing field on labor and environmental regulation (and not be so quick to drive companies out of the country), rather than restricting the flow of capital, but I also look forward to a big time boycott of China as necessary to a world economic restructuring.
Regarding the idea of a Chinese boycott, I note that the response you received presents a fairly common fallacy. It keeps the wrong variable constant. The question to ask is not what the Chinese worker would be making if that slave-rate industrial job were unavailable to him, but rather what would be paid for manufacturing work if the plant were located in America, Canada, Japan, Australia, or Europe rather than in China. Keep the job constant rather than the person doing it. If more were paid, there would be more consumer demand, which would drive more investment, and the whole global economy would be bigger. Eventually this would benefit China as well. But by allowing China to brutalize its workforce like the autocratic capitalist empire it is, and encouraging foreign investment in this travesty, we are weakening the overall economic health of the world by far more than we benefit the Chinese.
I am all for tying trade agreements to other behavior. I liked the Jackson-Vanik Amendment to the 76 trade agreement that gave the USSR MFN only if they continued to allow Russian Jews to emigrate. On the other hand, I prefer trade to direct foreign aid which usually ends up in some dictator's Swiss account (next to Clinton's?).
I understand the policy toward China. Hook them on the biggest narcotic of all...the US dollar...and then we have a lever to condition their behavior. Who would be hurt more by a boycott...US or China? At some point, the Chinese are so hooked that the country destabilizes if we cut them off. And I think that this was a conscious (if unpublicized) rationale for the MFN status granted to China. And I am not at all opposed to using that tool (letting the Chinese workers starve to temper an aggressive Chinese military).
I did mention elsewhere that there is a moral component to purchasing the products of slave labor. Certainly not enough to justify these cross generation reparations lawsuits. But at some point, does this cease to be an honest form of aid and become exploitative? And if it works for China, why not for Mexico and solve the immigration issue at the same time?
This is buggy-whip economics. "Keep the job constant..."??? "If more were paid..."??? Who determines how to "Keep the job constant...?" Who decides "If more were paid...?" And who is "allowing China to brutalize its workforce"???
The world according to Brian Rush has all sorts of these strangers out there: Either theses strange power are ruining the whole thing (capitalists) or they stand ready to fix it all up (social engineers) and get the show humming just right! Yes, folks, it just the same old same old same old...
The world according to Marc Lamb says that markets determine how to and to what level to "Keep the job constant," and who gets "paid" when how and where. And finally, like the great American patriots of 1776, the people of China themselves can decide for themselves to allow "China to brutalize its workforce," or not!
The world, run according to Brian Rush, are still be making buggy whips. Thank God, America ain't run like that.
You clipped out the salient point of my post, which was that the capital represented by any money spent on any order of good ends up being shifted from marginal user to marginal user (of course, eroded by taxation at each step down the line; but that's a different issue) until it reaches the party who values it more for its investment in industrial growth more than the marginal liquidity or the consumables they forego in so investing. You imply that money not invested is wasted from an economy-wide standpoint. This is not the case, as no individual becomes an end-holder of monetary capital (once they have fulfilled their own personal liquidity needs). It continues to be exchanged for higher (subjective) marginal values; at some point, it is either dispersed as general liquidity or invested (perhaps poorly, in which case some part of the accumulated capital is lost; perhaps wisely, in which case humanity gets to enjoy the effects of generally higher capital stocks).
To simplify, buying gold, paintings, antiques, what have you -- provided it is done via exchange of real capital is the same thing as investing in industry; the money gets to whoever values it the highest one way or another.
"Qu'est-ce que c'est que cela, la loi ? On peut donc être dehors. Je ne comprends pas. Quant à moi, suis-je dans la loi ? suis-je hors la loi ? Je n'en sais rien. Mourir de faim, est-ce être dans la loi ?" -- Tellmarch
"Человек не может снять с себя ответственности за свои поступки." - L. Tolstoy
"[it] is no doubt obvious, the cult of the experts is both self-serving, for those who propound it, and fraudulent." - Noam Chomsky
Justin, the flaw in your analysis is that it considers the ultimate fate of all money in circulation, when what should be considered is the amount being invested in productive enterprises at any given time. It does us no good this year if money being invested nonproductively will be reinvested in something productive eventually.
Also, the key variable about investment capital is not whether someone "values it more for its investment in industrial growth more than the marginal liquidity or the consumables they forego in so investing." None of these investments has anything to do with marginal liquidity or consumption; they are all ways to make money. What matters is whether the holder of capital expects a return from investment in productive industry. Assuming the investor knows what he's doing, that depends on objective economic factors more than his own psychology.
