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Oh I forgot. Yes Virginia, there is a confidence fairy.
Machinery, bldg's, equipment, office supplies, etc all run out and wear out.
When confidence is high that the economy will improve, as for example a good republican gets elected, then business will purchase, repair and replace.
When confidence is low, as for example another democrat gets elected, then business will make do, substitute and get along.
Homeowners do the same thing.
...
And that's confirmation of the confidence fairy? News flash: everyone has to eat every day too.
The fact that investment hasn't fallen to zero doesn't mean it hasn't fallen sharply. In a recession, people may put off buying a new car, that doesn't mean they won't replace worn-out tires.
Under capacity businesses will still replace vital equipment to meet their demand. That doesn't mean they're running to the bank to expand their capacity.
The same thing with homes. During the boom, everyone was fixing everything. NOw that home prices have fallen, investment in home repairs is down -- that doesn't mean homeowners won't fix a broken toilet.
Location: Democratic Peoples Republic of Redneckistan
11,078 posts, read 15,080,865 times
Reputation: 3937
Quote:
Originally Posted by Tall_Rep
This country has always had a disparity of wealth and we've never beena third world nation. In a capitalist society that doesn't happen. Most wealth is based on the consumer. Most wealth in this country has come from owning and developing businesses that employ people.
Certainly there are 'idle rich'...but that is their prerogative in a free society. There are plenty of other investors trying to GAIN wealth who actually do something that employs people and thereby drives the economy. That is the way it has always been here.
And this country COULD BE wealthy....but the government is driving us into the crapper with the enormous debt they continue to pile on. We need responsible leaders who balance budgets...keep government small....drop the regulations that are frivilious and useless...and who stop playing politics with our money.
We need to attract MANUFACTURING jobs and keep them here. And piling on regulations that make it impossible for companies to turn an acceptable profit is dooming this country to the economic pits of hell that we see before us now.
Damn TR...This is the very first post you have made that I pretty much agree with everything you say.
The problem is,those manufacturing jobs are gone for good.
Every POTUS from Reagan on out has pushed for and got the ok to give those jobs away to feed the rich investors and big business.
As far as deregulation is concerned I partly agree with you...it depends on which regulations you mean.
For example,Reagan deregulated the trucking industry and the results have been disasterous to the working drivers/owner operators.
That opened the door to companies like J.B. Hunt et al to become wealthy and pay less and less to the workers in the field,but to concentrate the bulk of the wealth among a few(prime example of the total failure of Reagan and of his damage to the working class)...THAT kind of deregulation I'm not interested in.
Bush I and Clinton (Clinton signed it) gave us NAFTA which only helped big business and was the death knell for the America as our fathers knew it...It's over.
Desperate times call for desperate measures and the ONLY way it will change is if we buck up as a country,tell the foreign countries to go to hell and start penalizing all business that is American owned but manufactures outside our country,tariff them equal to what it would cost to make it here and tariff any goods imported to an equal value of manufacture within the States...sounds stupid to some,but that's the only way your kids will ever see a decent job that is not service related.
The govt subsidizes farmers,why not tariff out of country manufacturers and use that to subsidize American businesses who have remained loyal to this country?
This country has always had a disparity of wealth and we've never been a third world nation. In a capitalist society that doesn't happen. Most wealth is based on the consumer. Most wealth in this country has come from owning and developing businesses that employ people.
I appreciate that you have that opinion; too bad it's not so. Most of the wealthy in recent years have been involved in finance, not manufacturing or consumers. Hedge fund managers have made billions and they don't put two sticks together.
The fact is that we have a society in which money is increasingly concentrated in the hands of a few people, and in which that concentration of income and wealth threatens to make us a democracy in name only.
There is something wrong when the top 0.1% of taxpayers earn as much as the bottom 150 million taxpayers.
Who’s in that top 0.1 percent? Are they heroic entrepreneurs creating jobs? No, for the most part, they’re corporate executives. Recent research shows that around 60 percent of the top 0.1 percent either are executives in nonfinancial companies or make their money in finance, i.e., Wall Street broadly defined. Add in lawyers and people in real estate, and we’re talking about more than 70 percent of the lucky one-thousandth.
But why does this growing concentration of income and wealth in a few hands matter? Part of the answer is that rising inequality has meant a nation in which most families don’t share fully in economic growth. Another part of the answer is that once you realize just how much richer the rich have become, the argument that higher taxes on high incomes should be part of any long-run budget deal becomes a lot more compelling.
The larger answer, however, is that extreme concentration of income is incompatible with real democracy. Can anyone seriously deny that our political system is being warped by the influence of big money, and that the warping is getting worse as the wealth of a few grows ever larger?
Damn TR...This is the very first post you have made that I pretty much agree with everything you say.
The problem is,those manufacturing jobs are gone for good.
Every POTUS from Reagan on out has pushed for and got the ok to give those jobs away to feed the rich investors and big business.
As far as deregulation is concerned I partly agree with you...it depends on which regulations you mean.
For example,Reagan deregulated the trucking industry and the results have been disasterous to the working drivers/owner operators.
That opened the door to companies like J.B. Hunt et al to become wealthy and pay less and less to the workers in the field,but to concentrate the bulk of the wealth among a few(prime example of the total failure of Reagan and of his damage to the working class)...THAT kind of deregulation I'm not interested in.
Bush I and Clinton (Clinton signed it) gave us NAFTA which only helped big business and was the death knell for the America as our fathers knew it...It's over.
Desperate times call for desperate measures and the ONLY way it will change is if we buck up as a country,tell the foreign countries to go to hell and start penalizing all business that is American owned but manufactures outside our country,tariff them equal to what it would cost to make it here and tariff any goods imported to an equal value of manufacture within the States...sounds stupid to some,but that's the only way your kids will ever see a decent job that is not service related.
The govt subsidizes farmers,why not tariff out of country manufacturers and use that to subsidize American businesses who have remained loyal to this country?
The problems will not resolve by simply taxing companies who produce overseas. They will transfer that tax to the consumers by raising price. Worst, they move overseas completely and then more jobs will be lost.
The 1st thing need to be done is lower tax. When tax is low, their profit of margin increase. Money is one of the reason why they move the production overseas
The 2nd thing need to be done is reduce regulations. We have too much and they are open to interpret by mindless bureaucrats. Just ask yourself this, if you are running a business, are you going to bother to go to Communist China and deal with their government just to make a few $ when the home government has free enterprise? No. Companies do it because Communist China has a freer enterprise than the USA.
Location: Democratic Peoples Republic of Redneckistan
11,078 posts, read 15,080,865 times
Reputation: 3937
Quote:
Originally Posted by cw30000
snip>The 1st thing need to be done is lower tax. When tax is low, their profit of margin increase. Money is one of the reason why they move the production overseas<
.
I do not agree with that at all...reread my original post as I gave my thoughts on it there and they have not changed in the last hour.
The problems will not resolve by simply taxing companies who produce overseas. They will transfer that tax to the consumers by raising price. Worst, they move overseas completely and then more jobs will be lost.
The 1st thing need to be done is lower tax. When tax is low, their profit of margin increase. Money is one of the reason why they move the production overseas
The 2nd thing need to be done is reduce regulations. We have too much and they are open to interpret by mindless bureaucrats. Just ask yourself this, if you are running a business, are you going to bother to go to Communist China and deal with their government just to make a few $ when the home government has free enterprise? No. Companies do it because Communist China has a freer enterprise than the USA.
I'd like to see your evidence that companies "will transfer that tax to the consumers by raising price." The effective corporate tax used to be much higher than now. If your theory is correct, surely there is evidence that when taxes were lowered prices fell. I see no evidence of that.
Moreover, in theory, your theory may be correct -- but only if there is inelastic supply. The reality is that corporations face intense competition from both domestic and international competitors and are unable to raise prices unless absolutely necessary.
The fact is that corporations already pay low taxes -- far lower than in other times in history. In fact, according to Barry Ritholtz, 'The GAO reported in 2008 that “two out of every three United States corporations paid no federal income taxes from 1998 through 2005.”' It's kind of hard to blame taxes when 2/3 of corporations pay no tax.
From the above link:
Quote:
Corporate Taxes as a Percentage of Federal Revenue
1955 . . . 27.3%
2010 . . . 8.9%
Corporate Taxes as a Percentage of GDP
1955 . . . 4.3%
2010 . . . 1.3%
Individual Income/Payrolls as a Percentage of Federal Revenue
1955 . . . 58.0%
2010 . . . 81.5%
Oh, the "study" done is from a joint effort by two left-wing think tanks. Discredited right there, as the Gingrich campaign has said.
Note that they dismiss the findings because they don't like the source. The reality is that they can't dispute the findings. If they could, they would. Instead, they have to dismiss the messenger.
The fact is that there is no empirical evidence that lowering tax-rates has ever resulted in more government revenue, when one accounts for both inflation and population growth. Yet, Mr. Gingrich is trying to sell the same snake oil that was sold in the 1980s and 2000's with negative effects. NG's plan increases the yearly deficit by $1.3 trillion.
Note that they dismiss the findings because they don't like the source. The reality is that they can't dispute the findings. If they could, they would. Instead, they have to dismiss the messenger.
The fact is that there is no empirical evidence that lowering tax-rates has ever resulted in more government revenue, when one accounts for both inflation and population growth. Yet, Mr. Gingrich is trying to sell the same snake oil that was sold in the 1980s and 2000's with negative effects. NG's plan increases the yearly deficit by $1.3 trillion.
What would you expect from the Urban Institute and the Brookings Institute, AKA Tax Policy Institute, both left-wing think tanks?
Tax rates lowered in 2003 and as you can SEE, the deficit decreased dramatically from 2004-2008.
Now, WHAT in the world would cause the deficit to DECREASE? Increase of revenues to the Treasury and in this case, that comes from a direct result of the Bush tax cuts.
You been shown this before, you've ignored it before, I expect you'll continue to ignore it.
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