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And you most certainly always required at least some capital upfront before you would start a job. When you weren't busy you might make some furniture or something to stay busy and possibly bring in some income. No one in housing during a slow time just sits on their behind, they try to drum up business or build things on the side to see if they can sell them.
I think you're being disingenuous by claiming the only time you did anything was when someone wanted something.
Not at all, I have no reason to BS anyone. If you're asking about down time, you shape tools, repair power cords and bid new jobs. When not doing that I worked on my own home. I lived in and flipped 8 homes before building this one. I worked for myself building sweat equity and haven't had a mortgage since 1991 at 38.
Not at all, I have no reason to BS anyone. If you're asking about down time, you shape tools, repair power cords and bid new jobs. When not doing that I worked on my own home. I lived in and flipped 8 homes before building this one. I worked for myself building sweat equity and haven't had a mortgage since 1991 at 38.
Flipping homes is the perfect example of supply side. The same with spec homes. Both of which I'm sure you know about...
Not in the industry he is maiming to be in. It's pretty standard to require 50% or so up front for jobs depending on their size. If required, the other money the GC and/or contractor will put forward.
Just like how capital came from investors for R&D for something like the supercomputer.
Surely you don't think a manufacturing line with something like million dollar Fuji machines for PCBs comes from the customer before they ever get a product?
That capital to purchase those came from somewhere. If you won't watch the video, at least read the transcript.
Quote:
It is astounding how significantly one idea can shape a society and its policies. Consider this one.
If taxes on the rich go up, job creation will go down.
This idea is an article of faith for republicans and seldom challenged by democrats and has shaped much of today's economic landscape.
But sometimes the ideas that we know to be true are dead wrong. For thousands of years people were sure that earth was at the center of the universe. It's not, and an astronomer who still believed that it was, would do some lousy astronomy.
In the same way, a policy maker who believed that the rich and businesses are "job creators" and therefore should not be taxed, would make equally bad policy.
I have started or helped start, dozens of businesses and initially hired lots of people. But if no one could have afforded to buy what we had to sell, my businesses would all have failed and all those jobs would have evaporated.
That's why I can say with confidence that rich people don't create jobs, nor do businesses, large or small. What does lead to more employment is a "circle of life" like feedback loop between customers and businesses. And only consumers can set in motion this virtuous cycle of increasing demand and hiring. In this sense, an ordinary middle-class consumer is far more of a job creator than a capitalist like me.
So when businesspeople take credit for creating jobs, it's a little like squirrels taking credit for creating evolution. In fact, it's the other way around.
Anyone who's ever run a business knows that hiring more people is a capitalists course of last resort, something we do only when increasing customer demand requires it. In this sense, calling ourselves job creators isn't just inaccurate, it's disingenuous.
That's why our current policies are so upside down. When you have a tax system in which most of the exemptions and the lowest rates benefit the richest, all in the name of job creation, all that happens is that the rich get richer.
Since 1980 the share of income for the richest Americans has more than tripled while effective tax rates have declined by close to 50%.
If it were true that lower tax rates and more wealth for the wealthy would lead to more job creation, then today we would be drowning in jobs. And yet unemployment and under-employment is at record highs.
Another reason this idea is so wrong-headed is that there can never be enough superrich Americans to power a great economy. The annual earnings of people like me are hundreds, if not thousands, of times greater than those of the median American, but we don't buy hundreds or thousands of times more stuff. My family owns three cars, not 3,000. I buy a few pairs of pants and a few shirts a year, just like most American men. Like everyone else, we go out to eat with friends and family only occasionally.
I can't buy enough of anything to make up for the fact that millions of unemployed and underemployed Americans can't buy any new clothes or cars or enjoy any meals out. Or to make up for the decreasing consumption of the vast majority of American families that are barely squeaking by, buried by spiraling costs and trapped by stagnant or declining wages. Here's an incredible fact. If the typical American family still got today the same share of income they earned in 1980, they would earn about 25% more and have an astounding $13,000 more a year. Where would the economy be if that were the case?
Significant privileges have come to capitalists like me for being perceived as "job creators" at the center of the economic universe, and the language and metaphors we use to defend the fairness of the current social and economic arrangements is telling. For instance, it is a small step from "job creator" to "The Creator". We did not accidentally choose this language. It is only honest to admit that calling oneself a "job creator" is both an assertion about how economics works and the a claim on status and privileges.
The extraordinary differential between a 15% tax rate on capital gains, dividends, and carried interest for capitalists, and the 35% top marginal rate on work for ordinary Americans is a privilege that is hard to justify without just a touch of deification
We've had it backward for the last 30 years. Rich businesspeople like me don't create jobs. Rather they are a consequence of an eco-systemic feedback loop animated by middle-class consumers, and when they thrive, businesses grow and hire, and owners profit. That's why taxing the rich to pay for investments that benefit all is a great deal for both the middle class and the rich.
So here's an idea worth spreading.
In a capitalist economy, the true job creators are consumers, the middle class. And taxing the rich to make investments that grow the middle class, is the single smartest thing we can do for the middle class, the poor and the rich.
How many hires does a business person make when they have zero sales over a long period of time? It takes customers walking thru the door to create new jobs.
Buit its simle to see consumers avilable in many countries where no investor steps foprward to fund the making of the products. of course all business is based o supllying consumer witht heir wants ;but their must be the investors to buidl the suply before the prodc=cut gets to market and take the risk if it does workout. I don't know of mnay things order except in cutom circumstances where the prodcut is piad for before productio is started.In fac mnay arge orders for equipment can take a year or more and often the money is pre investment or its borrowed.I saw a show on Catewrpillar takig a order from European that would be a year and they took out insurance that assured that the exchange rate wouldn't cause a loss even tho they funded the order for a year until sold.
That might almost be true if money was finite, it's not. Money is created in banks and a banks reserves only need to be 10% of what's loaned out. That means 90% of money loaned out is created from thin air meaning it didn't exist whether population growth increases or decreases matters not.
Flipping homes is the perfect example of supply side. The same with spec homes. Both of which I'm sure you know about...
IF I was flipping homes under my business name. I was flipping the home I lived in at the moment. From light paint job to getting the whole thing we'd live in the mess. In less than 15 years I built $450k in sweat equity
Most businesses are small, tiny, independent sole proprietors. Three quarters of all U.S. business firms have no payroll. Most are self-employed persons operating a small business they started themselves. 21 million sole proprietors in this country with ZERO employees. Another 3.6 million with less than 5 employees.
How many hires does a business person make when they have zero sales over a long period of time? It takes customers walking thru the door to create new jobs.
Customers do provide the money for businessmen to do business with but not a damned one of them hires, fires, or pays any of the people hired by the business.
Is this crap from you people something that is being taught in economics these days or what?
Customers do provide the money for businessmen to do business with but not a damned one of them hires, fires, or pays any of the people hired by the business.
Is this crap from you people something that is being taught in economics these days or what?
Most people call that "seeing the big picture," Roy.
SO you started a business with no inventory and no product
I did that a number of years ago but I had to buy all the equipment I needed to be self-employed and found no customers who were willing to pay for other necessary equipment, my social security taxes, or any other costs of doing business. I have to admit that as the only employee of the company I had to depend on customers to keep going but none of them paid me wages or anything else. Surely that must be what these people are talking about. I hired a bookkeeper but not one of those customers paid her because few of them ever paid me enough to keep her going. I think what they are trying to talk about is that kind of business and not one that depends on sales to keep going. For instance, I am going to a Sherwin-Williams franchise store tomorrow to buy paint and painting supplies. They won't make enough on the transaction to pay for replacement goods so they need quite a bit more money to re-supply. I don't see how one customer does a lot for those 4 people who work for the owner of the business but then they are not a service business. So many of our businesses of today are that kind but what about all the franchise businesses, like that paint store, a fast food chain franchise, automobile dealers, farm equipment dealers who provide mechanics to repair breakdowns. I want to see buzzards buy 4 or 5 $250K field sprayers and sit on them while customers come in. People so often do not pay cash for many things but certainly do pay in installments and their customers do not directly pay the employees.
A short example of what I just said would be my son who is the best mechanic the company employes and is often demanded as to who farmers want to do the repair work for them. He drives a service truck and although he makes between $60 and $70 k per year not one customer pays him one penny of that. The company demands that the employees not moonlight and he is one of the reasons they do that. This whole thing makes me wonder how some of these people think.
Of course, we must look at the fact that I was involved in a service business, not a sales business.
Last edited by roysoldboy; 05-21-2012 at 07:57 PM..
Most people call that "seeing the big picture," Roy.
My son who many farmers demand be their mechanic because he is so good at it wants very badly to go into his own business but he would have to have people to supply him parts, have a place to work in, pay ridiculous insurance fees because machines are very expensive but have to be paid for if you screw up. He was surely going to go into the necessary debt to do that at one time but has seen the big picture, as he calls it, and decided to stay at what he is doing now a few more years.
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