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You have a fundamental misunderstanding of economics.
Look at it this way. How much does a loaf of bread cost? Who sets the cost of a loaf of bread?
A loaf of bread is sold at a price which incorporates all of its costs plus profits. Its costs are going to include taxes.
If hypothetically the costs of making bread is $.90, and the expected profits are $.10($1 a loaf of bread).. And then you raised taxes for the producer, and now the costs of making bread is suddenly $1.00 a loaf. Are they going to just take no profits at all?
No, they are going to raise the price of a loaf of bread from $1 to $1.10. And the people who will actually be paying for the increased tax on bread, is the consumer, not the producer.
There are only a few ways to deal with the "rich/poor" dynamic.
1) You can promote more competition. More competition means that profit margins will most likely be very small.
2) You can have the government set the price of goods and/or profit margins. Thus in the bread scenario before, the government could prevent the price of bread from rising from $1 to $1.10, and maybe instead peg prices at $1.05, to cut the profits of producers in half.
Of course, I would rather a policy that promotes competition. I think any attempt to regulate the market does more harm than good.
Unfortunately, the way this system works is they raise the cost of bread regardless of a tax increase. That is what has happened with this system. The problem, people went in and new they could make an increased profit paying no taxes and increasing the price. A little at a time.
I agree that competition from a business not caught up in the monopoly would work but unfortunately again they have learned to buy out those businesses to keep a monopoly going for the few larger companies. It was bound to happen left un checked for so long. Now we have a few fat cows that don't allow growth or competition. It's not a level playing field. That's what lack of regulation has gotten us. A playground full of bullies with either no teacher on duty or one bought out with apples.
Along with a few worms that have worked their way into the peoples government. It's a tough spot to be in for America. Being a puppet country for large business won't work. Everything from the fed. reserve to elections is tied up with corporate worms. It's a mess and I don't think a solution is on the horizon.
No I don't have a fundamentsl midunderstsnding at all. What I have is a clear vision of vast numbers of underpaid working people in the USA producing huge profits for the owners. My fundamental observation is that many sectors of the American economy are still nothing much better than exploitation machines. Squeezing the most out of workers and returning the least possible.
You know, the owner class cries the blues about any improvment in their workers lives. They truely are like a bunch of freakin Scrooges. They are also mostly full of BS when they make any comments at all on reforms in employment standards. A few years ago in Alberta there wee so many decent jobs available that the local MacDonalds had to pay $20 an hour for burger flippers. How many MacDonalds do you suppose went out of business? NONE did, the owners just had to make do with a little less profit.
All trickle down economics really is, is an attempt at keeping the most money possible at the top using a whole variety of ways and means to acchieve that goal. Labour law, taxation, trade barriers and what ever else they can rig to unbalance the playing field in their favour.
Let me explain a few things.
1) There is no such thing as a business in a fundamental sense. There are people who organize the production of goods and services.
2) Businesses exist to make money. People work to make money. If we didn't make money, we wouldn't work.
3) The problem with business profits aren't that they make a profit, they need to turn some kind of profit to exist. The problem people have with businesses are their profit margins.
4) How do you keep profit margins low? Do higher taxes keep profit margins low? Under Clinton the average CEO made 411 times his average employee. Compared to only 209 times today.
5) Does the minimum wage lower profit margins? There is no evidence that the minimum wage reduces profits. The vast majority of fortune 500 companies have basically zero employees who work for minimum wage. Only about 4% of all employees work for minimum wage now. When that wage goes up, what prevents companies from just raising prices? Nothing, and thats exactly what happens.
6) The owner class? Really? The whole concept of the owner class is basically ridiculous. The owner of what? McDonalds? Wal-mart? The people who own those companies are people, just like me and you. There is nothing stopping you from going into business tomorrow, except the fact that most likely no one would want to buy your product, and thus you would go out of business, and fall out of the "owner class".
7) The only way the "owner class" can exist, is either by two means. A) They can produce something people want to buy, and sell it to them. or B) They can manipulate the market to give them a competitive advantage.
8) You need to make a distinction between what appears on the surface to be force, and what is real force. No one is forced to go to McDonalds, neither for a burger or a job. No one is forced to shop at Wal-mart. You could grow yourself a backyard garden, and live in a shack on some small piece of land in the country. But who wants to do that?
I read an article yesterday about how San Francisco is going to start building 220 sqft apartments. Expected to rent for $1500 a month. Do you think thats a good deal? Would you pay $1500 a month for an apartment like that? Is someone forcing these people to live in 220 sqft apartments? Or are they choosing to live in tiny apartments?
The reality is not that there is a "owner class" in a general sense. A more accurate picture is that there are people who have created goods and services for sale for a price that people are willing to pay. And the people who work for those businesses, are doing it because it improves their own conditions higher than the alternatives.
I mean, you could live like a hippie, without electricity, plumbing, internet, in a tiny house burning wood to stay warm, with no car, growing your own food. But who wants to do that? Especially when you can work part-time at minimum wage and live a better life.
9) Why does civilization exist? Civilization exists for the purpose of trade. And trade only exists because of something called "the division of labor". If everyone could produce the same goods for the same price as everyone else, no one would trade goods, what would be the point? Trade exists because some people can produce some things more cheaply, and others can produce other things more cheaply. You eat at McDonald's for instance, because you feel like they can produce goods for less than yourself(if you calculate in the value of your time). You hire a mechanic because either you cannot work on your car, the quality of your work might be poor, or its just not worth your time. And mechanics only work as mechanics, because it is more profitable for themselves than the alternatives. In the end, if both parties didn't benefit, then there would be no trade.
Thus, trade exists only for the purpose of profit. And without trade, there wouldn't be civilization. And thus, the purpose of civilization is to facilitate a mechanism of profit, through the division of labor. If you want to destroy profit, you destroy civilization, and the myriad of advancements that have improved the human condition.
10) Since I assume at this point, that you understand that profit is important. The question is, how much profit is reasonable? And how can you minimize profits, while also maximizing trade/productivity, and the advancement of technology?
The solution is as simple as one word, "competition". This word is an amazing word, for within the word lies the potential of humanity. Within the word lies the improvement of the human condition. Competition ultimately makes everything better for the vast majority of people.
My first real taste of capitalism came from playing a video game. Called World of Warcraft. Within the game they had an auction house, where people would sell their goods. One of the items for sale was called a "glyph", which improved your character by "buffing" your skills. And so everyone needed these glyphs to make their in-game characters as strong as they could make them.
I remember, I went to buy a glyph and the one I wanted was selling for 50 gold. I thought that was a lot, so I spent a little time learning about the cost of materials to produce that glyph. The material cost to make the glyph, was about 5 gold each. So the people selling the glyphs were selling them at a massive profit.
Well, since I'm so cheap, I decided I wasn't going to pay the gold for the outrageously overpriced glyph, and decided I would just make my own. Well, making your own required learning the skills to produce that glyph, which took quite some time, and took an investment of gold to get all the skills you needed to produce the glyphs. But I learned all the glyphs, and decided to start selling the glyphs. At first I was trying to make a large profit. I was selling them for 20 gold a piece, less than half the original price.
After I started posting my glyphs, a lot of people would message me in game, complaining about how I was ruining the glyph market. But they would undercut me anyway. So I undercut them. And they undercut me. And I undercut them. Eventually I dropped the price of my glyphs down to just 7 gold a piece. From 50 gold all the way down to 7 gold. At that point the fury from other glyph sellers was insane. They would spam message me all day complaining about how much of an idiot I was, because I could make so much higher of a profit if I would just sell them for more.
But the reality was, I was still making a profit at 7 gold. I could have made a profit at 6 gold, or less.
After that experience, I started to understand how capitalism works. And it isn't such an evil institution if you really think about it. And it is quite fun for me to sit and ponder where other opportunities could come in. All it takes is some kind of inspiration. That inspiration almost always comes in the form of me being cheap.
For instance, I wanted to make an electric bicycle not long ago. But electric bicycles are so ridiculously expensive. And even conversion kits are too expensive in my opinion. So, what if you could make your own kit? Could you make a cheap electric bicycle? If you made a cheaper electric bicycle. Not only could you turn a profit, but you could provide people with something they want.
I was recently looking up having my home insulated. There are basically four types of primary insulation. Cellulose, fiberglass, styrofoam/isocyanate solid boards, and polyurethane expanding foam. The best stuff is polyurethane, but it is also the most expensive.
This was my estimation of costs of different types of insulation...
blow-in cellulose is $10.28, $11.10 after tax.. you get 150sqft per bag at r-13.. $.074 per sqft at r13
32' roll R-13 insulation $10.40.. $11.23 after tax.. you get about 40 sqft of insulation at r-13, so = $.28 per sqft at r13
4x8x3/4" iso board is $15, $16.20 after tax.. you get about 12.8 sqft of insulation at r-13, so $1.26 per sqft at r13
pour in polyurethane US composites is $330.. you get about 250sqft of insulation at r-13.. $1.32 per sqft at r13
Blow-in polyurethane is ~$650 for 600 board feet... you get 300 sqft at r-13.. $2.16 per sqft at r13
Point is, there is a significant gap between each insulation type. Is it worth it to buy blow-in polyurethane at $2.16 per sqft compared to 19 cents a sqft for fiberglass batting? Probably not.
But then, I was looking for maybe buying the blow-in polyurethane in bulk. If you order from China, it says the price per kilogram of polyurethane foam insulation varies from $1.5 to $4.5.
To compare, one pound of polyurethane is about three sqft of insulation 2" thick(r13). So at $650 for 300 sqft, thats about 100 pounds of insulation at $6.50 a pound. From China its listed at $1.50 to $4.50 a kilogram, with 2.2 kilograms per pound. That means, if those prices are correct, it would cost between $.68 and $2 per pound plus shipping for polyurethane from China. Which with shipping, could be as low as 1/9th the price. So instead of paying $2.16 per square foot for polyurethane foam insulation, it could be as little as $.24, cheaper than fiberglass batting from Lowes.
The typical cost of icynene is about $1.50 per sqft at 1" thick, so about $4.50-$5.00 for a 2x4 wall cavity per square foot. The cost of the polyurethane foam in materials to fill a 2x4 cavity, would be about $.40-$1.20 per square foot. If a house was 1,000 square feet with 8 foot walls, the outside walls are ~31.6 long each and 8 feet high. So roughly 1,000 square feet of outside walls. Which should cost about $400 to $1,200 in materials.
If you could spray the walls all by yourself in a full day. And you expected to make $300 on top of materials cost, to pay for tools, transportation, and advertising/customer service costs. Your bill for the job might be between $700 and $1,500.
For the icynene for the same job, the contractors would generally charge about $4,500-$5,000.
I was also looking at roofing. Roofing costs are usually broken down into a "square", which is 100 sqft. If your house is 1,000 sqft, your roof is most likely 1,200 to 1,500 sqft or 12-15 square.
To hire someone to tear off old shingles, haul them away, and replace with new shingles. It would most likely run you about $220-$250 per square in labor, plus the cost of shingles(about $70-$100 a square). About $1.20-$1.40 of that would be just for the labor for shingles themselves, about $.90-$1.00 of that is tearing off old shingles and taking them to the dump. So the total cost of removing old shingles and replacing them on a 1,000 sqft house would typically cost between $3500 and $5000. And a 2,000 sqft house would be between $7,000 and $10,000. Is that a good deal?
A good roofer can do as much as 10 squares a day(1,000 sqft). Which if you consider the $1.20 to $1.40 most roofing companies charge for labor. That one good roofer would do between $1,200 and $1,400 worth of work in a day. But that roofer might only get $200 of the value of his labor... Where does the rest go?
The truth is, you could start a roofing company tomorrow, and underbid all the jobs out there, and never have a shortage of work. Offer your roofers a commission on their work of $20-$25 a square for shingles, and $5-$10 for tear off. That would be $25-$35 a square labor in costs, plus $70-$100 in shingles. The costs for a 1,000 square foot house(12-15 square) would cost $1140 and $2025 in costs to you. Throw in another 10% in flashing, waste, and misc materials, thats $1254 to $2227 in costs. If you took a $300 cut off the top, you would be charging $1550-$2550 for the same job someone else was charging $3500-$5000 for. Do you have any idea how much work you could be doing at those rates? Do you know how many companies you would be putting out of business if you started undercutting like that? Is that a bad thing or a good thing?
The truth is, there is no "owning class". There are people who are entrepreneurial, and those who aren't. The people who aren't entrepreneurial, can't understand why they aren't being paid well enough, and demand more. But don't understand how capitalism works, and competition. Wal-mart exists because it out-competes everyone else. They provide a product for the price people are willing to pay. And people are willing to work at Wal-mart because it is better than the alternative. The gap between rich and poor has a direct relation to the availability of competition, not because of any exploitative means.
Milton Friedman always called it "setting a thief to catch a thief". If you want to prevent companies from overcharging their customers. Competition is the most effective way to prevent it. It is impossible for the government to catch a thief, because its impossible for the government to know what the appropriate prices should be. When the government tries to impose price controls, all they are doing is manipulating markets, and destroying real competition.
The truth is, the only failure in regards to capitalism, the free market, and competition. Comes where there is a lack of competition. Primarily, those areas where the government givers certain players special-privileges. Any form of subsidy is a special-privilege which distorts the market. And kind of tax break/incentive is a form of special-privilege and distorts the market. The federal reserve is one of the most corrupt institutions in this country, and is nothing but a web of special-privilege to bankers. Which destroys the potential for individuals to store value.
If you want more ideas on how to be an entrepreneur, just ask.
The truth is, if you look at it in a childish way, as many on the left do, it's not as cut and dry as someone having more money to invest in their business.
While that is part of it, look at it in these terms.
Picture a small community with one manufacturing plant. The owner hires people at an agreed upon wage and they start making widgets. The owner makes a product that is desired, needed or useful. People buy their products. A bakery, a restaurant, a car dealership and many other businesses grow around this plant.
Property and sales taxes pay for education, police, fire and utility infrastructure.
In the mean time, the employees spend their money at the local businesses, with the owner spending much more annually than the employee. Not to mention the fact that the business owner pays much more in taxes than your average citizen.
If left alone, without excessive regulation, unionization and other interruptions, the business will thrive, adding more jobs and higher wages.
As soon as too many second handers start to pressure the business owner, without any actual ownership in his business, profits dwindle. Soon, the pressures of not only running a business, but abiding by labor laws, and over regulation takes their toll. The business owner will soon discover that it's just not worth it.
Atlas will Shrug.
The reason there are labor laws is that when given free reign business owners treated workers unfairly and put them in positions that jeopardized their health and safety.
The reason there are environmental laws is that when given free reign business owners polluted and then tried to cover up the fact they were polluting, endangering the health of the communities they were in and leaving government to pick up the tab for cleaning up their messes.
Businesses have only themselves to blame for the regulatory environment they find themselves in if they weren't so damn, greedy, callous, and uncaring about the health, and safety of their workers or the environment there would be no need to regulate them.
The financial crisis of 2008 is yet another example of businesses, in this case, the financial services industry being so damn greedy they were willing to risk the health of the entire global financial system by securitizing high risk mortgage and handing them off to unsuspecting investors as sound investments.
The historical record is clear, when left to their own devices most business don't give a damn about treating their workers fairly, protecting the environment, or even being responsible members of society in terms of acting is socially responsible way.
Can someone cite a relatively recent (meaning relevant) example
of large-scale trickle down economics working for an entire country?
Quote:
Originally Posted by antredd
Good question.
Not recent... but the US at about 1960 was pretty close.
It required unions and a shortage of labor so that wages (and their buying power) were high enough...
and a high corporate tax structure such that Co's would rather pay those high wages...
than taxes on the income if they kept it.
Today... we have a way high surplus of labor, almost none of the common jobs unionized,
and a tax structure that (for those dumb enough to not offshore their income) doesn't hurt all that much.
The economy is broken -- what we're facing is trickle down debt and deficits -- and soon EVERYONE is going to have to do some belt tightening and not just the fewer and fewer taxpayers.
Having been a technician in the Navy (crypto repair, and radio receivers), I spent many years in electronics as a bench tech. I also tried photography for a time, as I had an interest in that, but I chose not to make a career of it, and instead stayed with the electronics.
The electronics led me to become a Field Service Tech at an oceanographic instruments company. We built underwater TV systems for the offshore drilling and commercial diving industry, as well as cameras used to inspect nuclear reactors at nuclear power plants (and I have visited 3 such plants as a field service tech, one at the recently in the news Con Ed plant at Indian Point in New York).
From a field service tech, I was advanced to the Marketing Department, where I supervised a group responsible for writing Sales Orders for spare parts (cameras, winches, cables, lights, etc) and seeing to it that they shipped on time. In my capacity, I was required to interface with those in assembly, finished goods, inventory control, machinists, and engineering.
At one point in my working life, I spent about 18 months helping my brothers-in-law build houses in Southern California (San Diego). I did everything from framing to finish carpentry. So, I know what it means to swing a 16oz framing hammer and correctly use a worm drive Skill saw. I enjoyed it immensely.
I also know how to hang and finish drywall.
When we moved to Ohio in 1993, I started my own tile business. I did ceramic tile installations. Floors, walls, custom showers, etc. There is hardly any place we can go that we don't drive past two or three tile jobs we have done.
I am now retired. For my retirement career, I am doing Web designing.
So, I have done manual labor, mental labor (which is primarily what a tech does ... solving electronic problems), and sat behind a desk in a supervisory roll.
I know how a corporation works, and believe me, those at the "top" work harder and have more responsibility than the assembly line workers (none of whom were unionized in the companies I worked for) But we all knew everybody else, and we all got along very well with those in shipping, receiving, assembly, etc. We were always like family. We always respected each other. And by the way, we did not have a turnover of employees. Most of those in assembly had been with the company a very long time, and I saw many promoted.
No I don't have a fundamentsl midunderstsnding at all. What I have is a clear vision of vast numbers of underpaid working people in the USA producing huge profits for the owners. My fundamental observation is that many sectors of the American economy are still nothing much better than exploitation machines. Squeezing the most out of workers and returning the least possible.
You know, the owner class cries the blues about any improvment in their workers lives. They truely are like a bunch of freakin Scrooges. They are also mostly full of BS when they make any comments at all on reforms in employment standards. A few years ago in Alberta there wee so many decent jobs available that the local MacDonalds had to pay $20 an hour for burger flippers. How many MacDonalds do you suppose went out of business? NONE did, the owners just had to make do with a little less profit.
All trickle down economics really is, is an attempt at keeping the most money possible at the top using a whole variety of ways and means to acchieve that goal. Labour law, taxation, trade barriers and what ever else they can rig to unbalance the playing field in their favour.
1) There is no such thing as a business in a fundamental sense. There are people who organize the production of goods and services.
2) Businesses exist to make money. People work to make money. If we didn't make money, we wouldn't work.
3) The problem with business profits aren't that they make a profit, they need to turn some kind of profit to exist. The problem people have with businesses are their profit margins.
4) How do you keep profit margins low? Do higher taxes keep profit margins low? Under Clinton the average CEO made 411 times his average employee. Compared to only 209 times today.
5) Does the minimum wage lower profit margins? There is no evidence that the minimum wage reduces profits. The vast majority of fortune 500 companies have basically zero employees who work for minimum wage. Only about 4% of all employees work for minimum wage now. When that wage goes up, what prevents companies from just raising prices? Nothing, and thats exactly what happens.
6) The owner class? Really? The whole concept of the owner class is basically ridiculous. The owner of what? McDonalds? Wal-mart? The people who own those companies are people, just like me and you. There is nothing stopping you from going into business tomorrow, except the fact that most likely no one would want to buy your product, and thus you would go out of business, and fall out of the "owner class".
7) The only way the "owner class" can exist, is either by two means. A) They can produce something people want to buy, and sell it to them. or B) They can manipulate the market to give them a competitive advantage.
8) You need to make a distinction between what appears on the surface to be force, and what is real force. No one is forced to go to McDonalds, neither for a burger or a job. No one is forced to shop at Wal-mart. You could grow yourself a backyard garden, and live in a shack on some small piece of land in the country. But who wants to do that?
I read an article yesterday about how San Francisco is going to start building 220 sqft apartments. Expected to rent for $1500 a month. Do you think thats a good deal? Would you pay $1500 a month for an apartment like that? Is someone forcing these people to live in 220 sqft apartments? Or are they choosing to live in tiny apartments?
The reality is not that there is a "owner class" in a general sense. A more accurate picture is that there are people who have created goods and services for sale for a price that people are willing to pay. And the people who work for those businesses, are doing it because it improves their own conditions higher than the alternatives.
I mean, you could live like a hippie, without electricity, plumbing, internet, in a tiny house burning wood to stay warm, with no car, growing your own food. But who wants to do that? Especially when you can work part-time at minimum wage and live a better life.
9) Why does civilization exist? Civilization exists for the purpose of trade. And trade only exists because of something called "the division of labor". If everyone could produce the same goods for the same price as everyone else, no one would trade goods, what would be the point? Trade exists because some people can produce some things more cheaply, and others can produce other things more cheaply. You eat at McDonald's for instance, because you feel like they can produce goods for less than yourself(if you calculate in the value of your time). You hire a mechanic because either you cannot work on your car, the quality of your work might be poor, or its just not worth your time. And mechanics only work as mechanics, because it is more profitable for themselves than the alternatives. In the end, if both parties didn't benefit, then there would be no trade.
Thus, trade exists only for the purpose of profit. And without trade, there wouldn't be civilization. And thus, the purpose of civilization is to facilitate a mechanism of profit, through the division of labor. If you want to destroy profit, you destroy civilization, and the myriad of advancements that have improved the human condition.
10) Since I assume at this point, that you understand that profit is important. The question is, how much profit is reasonable? And how can you minimize profits, while also maximizing trade/productivity, and the advancement of technology?
The solution is as simple as one word, "competition". This word is an amazing word, for within the word lies the potential of humanity. Within the word lies the improvement of the human condition. Competition ultimately makes everything better for the vast majority of people.
My first real taste of capitalism came from playing a video game. Called World of Warcraft. Within the game they had an auction house, where people would sell their goods. One of the items for sale was called a "glyph", which improved your character by "buffing" your skills. And so everyone needed these glyphs to make their in-game characters as strong as they could make them.
I remember, I went to buy a glyph and the one I wanted was selling for 50 gold. I thought that was a lot, so I spent a little time learning about the cost of materials to produce that glyph. The material cost to make the glyph, was about 5 gold each. So the people selling the glyphs were selling them at a massive profit.
Well, since I'm so cheap, I decided I wasn't going to pay the gold for the outrageously overpriced glyph, and decided I would just make my own. Well, making your own required learning the skills to produce that glyph, which took quite some time, and took an investment of gold to get all the skills you needed to produce the glyphs. But I learned all the glyphs, and decided to start selling the glyphs. At first I was trying to make a large profit. I was selling them for 20 gold a piece, less than half the original price.
After I started posting my glyphs, a lot of people would message me in game, complaining about how I was ruining the glyph market. But they would undercut me anyway. So I undercut them. And they undercut me. And I undercut them. Eventually I dropped the price of my glyphs down to just 7 gold a piece. From 50 gold all the way down to 7 gold. At that point the fury from other glyph sellers was insane. They would spam message me all day complaining about how much of an idiot I was, because I could make so much higher of a profit if I would just sell them for more.
But the reality was, I was still making a profit at 7 gold. I could have made a profit at 6 gold, or less.
After that experience, I started to understand how capitalism works. And it isn't such an evil institution if you really think about it. And it is quite fun for me to sit and ponder where other opportunities could come in. All it takes is some kind of inspiration. That inspiration almost always comes in the form of me being cheap.
For instance, I wanted to make an electric bicycle not long ago. But electric bicycles are so ridiculously expensive. And even conversion kits are too expensive in my opinion. So, what if you could make your own kit? Could you make a cheap electric bicycle? If you made a cheaper electric bicycle. Not only could you turn a profit, but you could provide people with something they want.
I was recently looking up having my home insulated. There are basically four types of primary insulation. Cellulose, fiberglass, styrofoam/isocyanate solid boards, and polyurethane expanding foam. The best stuff is polyurethane, but it is also the most expensive.
This was my estimation of costs of different types of insulation...
blow-in cellulose is $10.28, $11.10 after tax.. you get 150sqft per bag at r-13.. $.074 per sqft at r13
32' roll R-13 insulation $10.40.. $11.23 after tax.. you get about 40 sqft of insulation at r-13, so = $.28 per sqft at r13
4x8x3/4" iso board is $15, $16.20 after tax.. you get about 12.8 sqft of insulation at r-13, so $1.26 per sqft at r13
pour in polyurethane US composites is $330.. you get about 250sqft of insulation at r-13.. $1.32 per sqft at r13
Blow-in polyurethane is ~$650 for 600 board feet... you get 300 sqft at r-13.. $2.16 per sqft at r13
Point is, there is a significant gap between each insulation type. Is it worth it to buy blow-in polyurethane at $2.16 per sqft compared to 19 cents a sqft for fiberglass batting? Probably not.
But then, I was looking for maybe buying the blow-in polyurethane in bulk. If you order from China, it says the price per kilogram of polyurethane foam insulation varies from $1.5 to $4.5.
To compare, one pound of polyurethane is about three sqft of insulation 2" thick(r13). So at $650 for 300 sqft, thats about 100 pounds of insulation at $6.50 a pound. From China its listed at $1.50 to $4.50 a kilogram, with 2.2 kilograms per pound. That means, if those prices are correct, it would cost between $.68 and $2 per pound plus shipping for polyurethane from China. Which with shipping, could be as low as 1/9th the price. So instead of paying $2.16 per square foot for polyurethane foam insulation, it could be as little as $.24, cheaper than fiberglass batting from Lowes.
The typical cost of icynene is about $1.50 per sqft at 1" thick, so about $4.50-$5.00 for a 2x4 wall cavity per square foot. The cost of the polyurethane foam in materials to fill a 2x4 cavity, would be about $.40-$1.20 per square foot. If a house was 1,000 square feet with 8 foot walls, the outside walls are ~31.6 long each and 8 feet high. So roughly 1,000 square feet of outside walls. Which should cost about $400 to $1,200 in materials.
If you could spray the walls all by yourself in a full day. And you expected to make $300 on top of materials cost, to pay for tools, transportation, and advertising/customer service costs. Your bill for the job might be between $700 and $1,500.
For the icynene for the same job, the contractors would generally charge about $4,500-$5,000.
I was also looking at roofing. Roofing costs are usually broken down into a "square", which is 100 sqft. If your house is 1,000 sqft, your roof is most likely 1,200 to 1,500 sqft or 12-15 square.
To hire someone to tear off old shingles, haul them away, and replace with new shingles. It would most likely run you about $220-$250 per square in labor, plus the cost of shingles(about $70-$100 a square). About $1.20-$1.40 of that would be just for the labor for shingles themselves, about $.90-$1.00 of that is tearing off old shingles and taking them to the dump. So the total cost of removing old shingles and replacing them on a 1,000 sqft house would typically cost between $3500 and $5000. And a 2,000 sqft house would be between $7,000 and $10,000. Is that a good deal?
A good roofer can do as much as 10 squares a day(1,000 sqft). Which if you consider the $1.20 to $1.40 most roofing companies charge for labor. That one good roofer would do between $1,200 and $1,400 worth of work in a day. But that roofer might only get $200 of the value of his labor... Where does the rest go?
The truth is, you could start a roofing company tomorrow, and underbid all the jobs out there, and never have a shortage of work. Offer your roofers a commission on their work of $20-$25 a square for shingles, and $5-$10 for tear off. That would be $25-$35 a square labor in costs, plus $70-$100 in shingles. The costs for a 1,000 square foot house(12-15 square) would cost $1140 and $2025 in costs to you. Throw in another 10% in flashing, waste, and misc materials, thats $1254 to $2227 in costs. If you took a $300 cut off the top, you would be charging $1550-$2550 for the same job someone else was charging $3500-$5000 for. Do you have any idea how much work you could be doing at those rates? Do you know how many companies you would be putting out of business if you started undercutting like that? Is that a bad thing or a good thing?
The truth is, there is no "owning class". There are people who are entrepreneurial, and those who aren't. The people who aren't entrepreneurial, can't understand why they aren't being paid well enough, and demand more. But don't understand how capitalism works, and competition. Wal-mart exists because it out-competes everyone else. They provide a product for the price people are willing to pay. And people are willing to work at Wal-mart because it is better than the alternative. The gap between rich and poor has a direct relation to the availability of competition, not because of any exploitative means.
Milton Friedman always called it "setting a thief to catch a thief". If you want to prevent companies from overcharging their customers. Competition is the most effective way to prevent it. It is impossible for the government to catch a thief, because its impossible for the government to know what the appropriate prices should be. When the government tries to impose price controls, all they are doing is manipulating markets, and destroying real competition.
The truth is, the only failure in regards to capitalism, the free market, and competition. Comes where there is a lack of competition. Primarily, those areas where the government givers certain players special-privileges. Any form of subsidy is a special-privilege which distorts the market. And kind of tax break/incentive is a form of special-privilege and distorts the market. The federal reserve is one of the most corrupt institutions in this country, and is nothing but a web of special-privilege to bankers. Which destroys the potential for individuals to store value.
If you want more ideas on how to be an entrepreneur, just ask.
Not this^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ you left out subsidies to farmers (owner class), large corporations, oil industries, and a few others.
Glad you brougt up Walmart too. Walmart exists because they buy from companies where their goods are mfd. in China, 1. americans cannot compete with cheap chinese labor. 2. when Walmart buys, it is done so in a leveraging manner, e.g. a vendor goes to sell a product at WM, tells WM the price is $1.00, WM says, we'll pay 15 cents and no more, take it or leave it. WM is ruthless. 3. when WM want's to build a new store, communities kiss their a**es to get the store built by giving them tax breaks to build, while WM cuts the working person's throat by offering low pay and low hours, but all the while making it look like they're giving jobs to the commuity. 4. the propaganda just kills me, BP goes on national television and tells everyone how they've cleaned up the gulf after their oil gusher, and how good and clean the waters in the gulf are. If this were the case, why are dead dolphins and fish washing up onto shores? All the while BP is getting tax breaks. Big business and trickle down does not work, lucknow's post is spot on.
Here is an excerpt of a MSM rag
Quote:
At the same time, BP was reaping sizable tax benefits from leasing the rig. According to a letter sent in June to the Senate Finance Committee, the company used a tax break for the oil industry to write off 70 percent of the rent for Deepwater Horizon — a deduction of more than $225,000 a day since the lease began.
If you are smart you will ignore all the partisans and the "I hate any business" types.
Another example of "trickle down" is this:
When ANY body has disposable income they buy extras.The more money you have, the more you buy.
Start with the better off. They might buy that new car, or that new TV, or remodel their existing home even buy that summer home.
We are a consumer nation, the more that is consumed the more jobs are needed.
Think of all the construction trade people are required to re model the house or build a new one.
Think of all the products needed for the re model or the new house. from the lumber to the rugs to the appliances.
Think of the other jobs invoked with any of the examples.
When all these people, from the lower middle class all the way up to the "rich" have money they buy which creates a demand for produces and services which in turn creates jobs.
All that money spent trickles down to everyone else.
When people have disposable income they go out to dinner more, go to the movies more, go to other entertainment venues more which in turn creates demand for products and services. Business either expand to meet the demand or new business open.
Someone else asked when it worked recently. All you have to do is look at the statistics during the Bush years before the housing bubble burst.
People with money don't sit on it. Whether they are rich or lower middle class. The more they spend, it "trickles down to the every one else.
Conversely when people DON'T spend business dry up and people lose jobs.
But Big Business likes to feign patriotism and loyalty when it has useful idiots like the poor working class to go fight in war's, claiming it is for the nations interests, when it has nothing to do with defense but everything to protect their foreign business interests.
Quote:
Originally Posted by EinsteinsGhost
Business friendly can mean looking for a labor pool that is desperate, will work for pittance, won't complain about living and working conditions. A nation that doesn't care about its people having access to clean water and air.
But as far as business' preferences... the idea is NEVER public welfare or loyalty to a nation.
Saw that post before. That is what the union bosses tell you. It's a lie. But just look at how rich the union bosses are, and the union organizations. The unions have billions of dollars, and they got it from you.
What does the union do for you?
The day you start thinking for yourself is the day you begin to experience real freedom.
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