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Your argument is irrelevant to the point I am making. I am not suggesting that there should be no profits, I'm suggesting that the unfair distribution of profit is exacerbating social problems.
Well... get everyone (which largely consists of middle class working and retired Americans) to agree to reduce their pensions and retirement accounts so that corporations earn less in profits, and employees can be paid more. Think you can pull that off?
No. The bottom has chosen to pay the inflation tax via choosing to remain financially ignorant and/or via a lack of self-discipline that causes anyone from not doing the exact same thing as all those self-made millionaires and billionaires.
Again. You personally can better your personal position. But the shape of the distribution is not a function of personal choice. You can't chose to continue to live here and work at a job that has been moved over seas. They are doing this to cut labor costs. The large scale movement of jobs over seas required the free movement of capital across national borders. That is a manipulation of the system that has in part put the tax from inflation on the bottom end instead of the top. They borrow new money to move the job over seas.
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Originally Posted by InformedConsent
Only 15% of the top 1%'s wealth was inherited. The rest, a full 85% of it, was earned/accumulated via wise life and financial decisions.
Again. You personally can better your personal position. But the shape of the distribution is not a function of personal choice.
Indeed, it is. The shape of the distribution would be different if people could actually control themselves and not live beyond their means. That means making sacrifices and delaying gratification, and a lot of people just won't do that.
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You can't chose to continue to live here and work at a job that has been moved over seas.
Why would anyone limit themselves to only a single set of work skills? That's a perfect example of why I'm saying many of those in the lower quintiles are there by choice.
Perfect example: I have a friend who's a carpenter. He struggles, as carpenters don't make much money per hour and frequently carpentry work is not a priority item for property owners, so available work can be quite sparse for him. In direct contrast, plumbers and electricians command a MUCH higher fee per hour because they're licensed, and when one has a plumbing or electrical issue, that IS a priority and gets addressed rather quickly. All 3 are trades but carpenters are paid much less than the other two and aren't a priority, while it's a very different case for plumbers and electricians. Choosing one's profession in the trades is a matter of choice. My carpenter friend brought on his own hardship and struggles by not choosing to be a plumber or electrician, and choosing to not acquire those skills/licensure.
Well... get everyone (which largely consists of middle class working and retired Americans) to agree to reduce their pensions and retirement accounts so that corporations earn less in profits, and employees can be paid more. Think you can pull that off?
They don't have to reduce them. I'm talking about steady growth rather than bubbles of huge gains followed by massive drops which are created through policy and market manipulation and which only serve to push private debt onto the government.
All the foreclosure debt that was written off, that caused government bailouts-those properties are still owned by some entity, right?
And when the market recovers, they will sell them at a profit, correct?
Will the government or the taxpayers receive any portion of that profit?
These economic bubbles are manipulated to occur in cycles with the same result every time.
I'm giving example after example here simplified so that anyone can understand the ramifications, yet it's like running my head into a brick wall. The brainwashing is so intense that people will deny logic and common sense in favor of the good old party line.
The extra money for increased wages has to come from somewhere. There's only a certain amount of corporate revenue. When employment costs (or ANY cost, including taxes) increase, profits decrease, and that hurts everyone (mostly the middle class) who depends/is depending on a pension or retirement account to fund their living expenses in their old age.
Indeed, it is. The shape of the distribution would be different if people could actually control themselves and not live beyond their means. That means making sacrifices and delaying gratification, and a lot of people just won't do that.
Two people standing in line to get booked into Jail. A heroin addicted and his pusher. The pusher says its your fault I'm here. If you didn't buy the crap I'm selling then I wouldn't be here. It is a matter of choice. But blaming the borrowers and not also the lenders is passing the buck.
The shape of the curve is a function of the way the laws are written. The top has them written so they benefit from inflation and the bottom gets hurt by it.
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Originally Posted by InformedConsent
Why would anyone limit themselves to only a single set of work skills? That's a perfect example of why I'm saying many of those in the lower quintiles are there by choice.
Try this one on. You can't choose not to go to school. There is a segment of our society that has historically gotten an intentionally bad education. There ancestors were forced into that position and getting a fair roll of the dice has been hard for them. It wasn't by choice that their ancestors were born into slavery.
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Originally Posted by InformedConsent
Perfect example: I have a friend who's a carpenter. He struggles, as carpenters don't make much money per hour and frequently carpentry work is not a priority item for property owners, so available work can be quite sparse for him. In direct contrast, plumbers and electricians command a MUCH higher fee per hour because they're licensed, and when one has a plumbing or electrical issue, that IS a priority and gets addressed rather quickly. All 3 are trades but carpenters are paid much less than the other two and aren't a priority, while it's a very different case for plumbers and electricians. Choosing one's profession in the trades is a matter of choice. My carpenter friend brought on his own hardship and struggles by not choosing to be a plumber or electrician, and choosing to not acquire those skills/licensure.
But the lot of carpenters, electricians and plumbers taken together is a function of the macro economic situation. And at that level some people's choices have far more impact than others.
The extra money for increased wages has to come from somewhere.
It comes from the wages that are paid.
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Originally Posted by InformedConsent
There's only a certain amount of corporate revenue. When employment costs (or ANY cost, including taxes) increase, profits decrease, and that hurts everyone (mostly the middle class) who depends/is depending on a pension or retirement account to fund their living expenses in their old age.
You've got the math wrong. The cost of labor is less than 100% of the cost of doing business. So the increase in prices to cover an increase of cost do to higher wages is less than 100% of the % of increase in costs.
The more you increase wage the more money everyone make.
The extra money for increased wages has to come from somewhere. There's only a certain amount of corporate revenue. When employment costs (or ANY cost, including taxes) increase, profits decrease, and that hurts everyone (mostly the middle class) who depends/is depending on a pension or retirement account to fund their living expenses in their old age.
Horse puckey. The money is there if the business is successful. It just needs a higher percentage allocated to the wages of lower level positions versus middle and upper management salaries and perks and excessive advertising spending.
When upper management speaks of running lean and cost control they really mean "let someone else take the cut."
It's an institutionalized policy of "don't give em too much".
This is where the government controls such as a living wage are necessary, since people like you won't do the right thing.
But blaming the borrowers and not also the lenders is passing the buck.
Not when the lenders were dictated how to lend by the GSEs (Fannie and Freddie). I've posted this many times, but the easy money housing bubble and burst and the consequent financial crisis that was induced by the critical mass of toxic mortgages defaulting was caused by the extremely irresponsible Clinton-era HUD mandates forced upon the GSEs and therefore the lenders from which the GSEs bought mortgages.
Clinton-era HUD mandates forced upon the GSEs:
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"Fannie Mae and Freddie Mac, government-sponsored enterprises (GSEs) in the secondary mortgage market, arethe two largest sources of housing finance in the United States. They fund these mortgages by purchasing loans directly from primary market mortgage originators, such as mortgage bankers and depository institutions, and holding these loans in portfolio, or by acting as a conduit and issuing mortgage-backed securities (MBS), which are then sold in the capital markets to a wide variety of investors.
HUD is the mission regulator for Fannie Mae and Freddie Mac, and a major aspect of this regulation involves setting minimum percentage-of-business goals for the GSEs’ mortgage purchases. These housing (or lending) goals deal with the enterprises’ support for low-income lending and lending in underserved geographic areas. Given the dominant role of the GSEs in the mortgage market, the housing goals play an important role in encouraging mortgage originators to undertake more affordable lending. The Department recently updated these goals, significantly increasing them for the years 2001-03.
In March 2000, HUD issued a proposed rule, significantly increasing the GSEs’ affordable housing goals for the post-2000 period, and this rule was finalized in October."
And the GSEs' (Fannie and Freddie) subsequent relaxing of lending standards:
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"...Countrywide tends to follow the most flexible underwriting criteria permitted under GSE and FHA guidelines. Because Fannie Mae and Freddie Mac tend to give their best lenders access to the most flexible underwriting criteria, Countrywide benefits from its status as one of the largest originators of mortgage loans and one of the largest participants in the GSE programs. When necessary—in cases where applicants have no established credit history, for example—Countrywide uses nontraditional credit, a practice accepted by the GSEs."
No established credit history = no FICO score = subprime, high-risk, and as it has turned out... toxic.
No you know why the GSEs (Fannie and Freddie) needed a $188 billion bailout, and why Countrywide's Mozilo never went to jail.
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