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While there are several types of Inflation, the basic definition is a sustained increase in price level. When there are more dollars (or any currency) competing for a given product it decreases the buying power of said currency and increases the price. Look to any point in history where Hyperinflation has occurred for examples.
The "inflation" you're describing is your $1 is buying less goods.
Inflation is EVERYONE's $1 buying less goods.
Your "inflation" is the product of the market, but the market also constrains it via competition.
Real inflation is from devaluing currency and competition can't do anything to constrain it.
Here is an idea: Everyone who works for an organization who makes more than one million dollars in income, stock options, and bonuses would agree to give up one half of their income to the staff who make under $50K a year. What impact would that have?
This is not a discussion of the merits of fairness or inequity. This is not a discussion of the merits of a higher minimum wage or how much people should make. INSTEAD, it is a simple question of mathematics.
IF the rich in all kinds of organizations gave half of the money they made in all forms of compensation to the poor or lower middle class how much more money would the poor and lower-middle-class workers at their organization make? For example, if everyone who worked as executives at Walmart gave up half of their compensation and put it in a pot to distribute to the rank and files retail and clerical workers at that company, how much extra money would it be for the regular employees? Would it solve the problem?
Highly paid jocks and movie stars would also participate too! Your thoughts.
What impact would it have?
The poor would be poor again in a very short amount of time because they would plow through that money,fast, spending it on all kinds of crap and services they don't actually need.
The wealthy, who created the products and services, would once again be wealthy and the poor would still be poor.
The problem isn't necessarily someone that makes a lot of money. The problem is the expectation of ever increasing government welfare programs to continue to inflate the markets. That is what has to stop.
Go ahead and do the math on their actual income. Let's use the CEO of WalMart as an extreme example.
CEO compensation total = $22.8 million.
Average Walmart salary for 2.2 million workers = $19,177.
Let's say 70% of that 2.2 million employee base make less than $50k. That's 1.54 million workers.
Now take half of the WalMart CEO's total compensation and spread that among the "poor" of just WalMart employees who make less than $50k annually:
$11,400,000/1,540,000 employees = $7.40 per employee ANNUALLY.
Broken down by the standard 2080 hour work year, that is a lofty 1/3rd of a cent per hour pay raise.
So what impact would it have on "the poor" to skin every millionaire and billionaire in America for half their "income?" Not much, assuming the WalMart case is an extreme example of salary ratio disparity.
Here's a mathematical fact about big numbers - if divided by other big numbers, the results are small numbers.
Example - seize half the combined wealth (not just income but every last penny they "own") of every billionaire in the country and spread it around to the people in America with less than the median household income. Forbes list the combined net worth of all America's billionaires at just under $3 trillion. And there are 127 million households in the US. Since we will distribute half to half, we can just use the whole numbers to calculate the ratio:
$3,000,000,000,000 / 127,000,000 = $23k per household under the median household income.
A nice chunk of change to most people, but not life changing by any means. Here's the thing - you can do that once. Not only is the next pool of money you rob going to be smaller because you already stole half of it, you also encouraged anyone dumb enough to amass a fortune to hide it, redirect it or get rid of it.
So when all those under-performing households get through their $23k windfall, then what? Oh, and understand that since a ton of these people's wealth is in the market, and your theft required a huge liquidation sale, the entire market will tank...hard, meaning the remaining wealth of "the rich" will end up being worth about 9-12 cents on the dollar next year when you need to give money to all those outstretched hands that now feel entitled to that same windfall every year.
The CEO's salary of Wal Mart is based largely upon the stock price. If we hadn't stolen from those who saved to inflate the markets, the middle class person that saved their entire lives are doing better and the CEO not so much.
2/3 of the economy is consumer consumption. The poor and middle class spend nearly 100% of their after tax income. The rich, however, save and invest much more. Therefore, the immediate impact would be akin to an economic stimulus to the economy and total GDP, which likely, in turn, will increase production to supply more goods and services, which in turn, will increase employment opportunities.
It's basic econ 101. Put the money in the hands of people who will spend it to get the most economic stimulus. The problem, however, in our current economy is that much of what we buy is produced in other countries....so any economic stimulus will go to create revenue and opportunity in other countries. If we were producing nearly all of what we consume, as a nation, the economic stimulus would create the ripple impact of increased production and demand for labor.
Econ 101? More like Socialism 101. It would both disincentivize the millionaires and billionaires to work and the low wage workers. It would dampen economic growth because there is no reward for it. You need to take one or six econ classes.
Try it and see how it works for yourself. Then report back here. Give up half of your income to a "charity" case and see what kind of long-term success it leads to.
Econ 101? More like Socialism 101. It would both disincentivize the millionaires and billionaires to work and the low wage workers. It would dampen economic growth because there is no reward for it. You need to take one or six econ classes.
BS!!! Corporate CEO's and the like are like professional athletes. It's not all about the money.....its about the love for the game. True, now that you pay them such.....if you try to take that away they will walk out because you have made them feel entitled to those sums of money....but keep in mind that people played the game when they were making 15 times less than today athletes. The same is true for CEO's. They are in it for the game, the power , the title and the control. There was a time when they too were making a lot less relative to the average workers. That did not demotivate people.
Last edited by Indentured Servant; 04-17-2019 at 04:52 PM..
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