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Economist Article On the Rich
Posted: 27 January 2011 11:08 AM   [ Ignore ]
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This is the first article of an special report dealing with the wealthy:

http://www.economist.com/node/17929075?story_id=17929075

One criticism I have is that the report bottom cutoff for the “rich” is a Million Dollars.  IMO this is much too low.  Back in the 60s or early 70s this may have been correct but I think, based on the fact that in 1965 when I started working I was making slightly over 5,000.00/ year, but now due to inflation, to maintain the same lifestyle it takes between 60,000.00 and 70,000.00, the cut off now should probably be approx. 10-15 million to be among the rich and to among the truly internationally influential rich you are probably looking at 100 million plus.

Here are some of the other articles:

http://www.economist.com/node/17929047?story_id=17929047

http://www.economist.com/node/17929013?story_id=17929013

http://www.economist.com/node/17928993?story_id=17928993

And the Economists defense of the rich:

http://www.economist.com/node/17929027?story_id=17929027

[ Edited: 27 January 2011 11:13 AM by garythehuman ]
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Posted: 27 January 2011 12:35 PM   [ Ignore ]   [ # 1 ]
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While I believe it is in the best interests of business to promote the prosperity of the working class I’m not sure that government regulation and government redistribution of wealth actually will achieve this.

The potential to accomplish this is there, there is no guarantee either through business or government, capitalism or socialism some form of economic equality can be achieved. Many of the rich donate time money and skills to help others. There are likely as many who hoard wealth and live to excess at the expense of their fellow man.

However politicians can as well redirect tax money to live in excess at the expense of their fellow man. Government and Business should work together towards economic equalization and the nation as a whole will benefit.

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Posted: 28 January 2011 02:08 PM   [ Ignore ]   [ # 2 ]
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Gnost:

While I believe it is in the best interests of business to promote the prosperity of the working class I’m not sure that government regulation and government redistribution of wealth actually will achieve this.

It is in the intrest of my business to have other businesses to promote the “prosperity of the working class” to increase the size of the market, while my business keeps wages low so that it has more it can convert more profit into capital to invest.  This is the basic contradiction of capitalism.

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Posted: 28 January 2011 03:28 PM   [ Ignore ]   [ # 3 ]
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garythehuman - 28 January 2011 02:08 PM

It is in the intrest of my business to have other businesses to promote the “prosperity of the working class” to increase the size of the market, while my business keeps wages low so that it has more it can convert more profit into capital to invest.  This is the basic contradiction of capitalism.

What’s to prevent your workers from demanding higher wages or seeking work elsewhere at a higher pay rate?

Capitalism allows for private ownership and private negotiations of value. Value is set buy agreement between seller and buyer. If you take the control to set value out of the hands of of the buyer and seller and place it, I assume in the hands of government, what is to prevent government corrupting the set value to it’s own benefit?

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Posted: 29 January 2011 09:03 AM   [ Ignore ]   [ # 4 ]
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Gnostikosis - 28 January 2011 03:28 PM
garythehuman - 28 January 2011 02:08 PM

It is in the intrest of my business to have other businesses to promote the “prosperity of the working class” to increase the size of the market, while my business keeps wages low so that it has more it can convert more profit into capital to invest.  This is the basic contradiction of capitalism.

What’s to prevent your workers from demanding higher wages or seeking work elsewhere at a higher pay rate?

Capitalism allows for private ownership and private negotiations of value. Value is set buy agreement between seller and buyer. If you take the control to set value out of the hands of of the buyer and seller and place it, I assume in the hands of government, what is to prevent government corrupting the set value to it’s own benefit?

Lack of jobs at higher payrates

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Posted: 30 January 2011 01:43 AM   [ Ignore ]   [ # 5 ]
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garythehuman - 28 January 2011 02:08 PM

Gnost:

While I believe it is in the best interests of business to promote the prosperity of the working class I’m not sure that government regulation and government redistribution of wealth actually will achieve this.

It is in the intrest of my business to have other businesses to promote the “prosperity of the working class” to increase the size of the market, while my business keeps wages low so that it has more it can convert more profit into capital to invest.  This is the basic contradiction of capitalism.

It is within the capacity of the government to increase wages, control housing costs and provide affordable housing, provide medical care, provide education, and provide adequate funds to those in need. The idea that wealth distribution is more complicated than controlling how much those at the top make at the expense of their workers is fallacy. Those tasks, as far as I am concerned, should be the main goals and purpose of government.

In Germany, any business with more than five employees has a workers council, that not only represents the employees with the employer, but they are held accountable for the success of the business. Surely such a plan is feasible for the US? And Canada?

A few years ago, I wrote a research paper on how much welfare money, in BC, was paid into the local economy through rental payments over a seven year period. The figure I came out with was low in to what would actually be paid. I only included employable people, and only calculated the actual amount welfare gives for rent, when people actually pay more. For instance, welfare in BC pays a single mother with one child $525 a month for rent. The average cost for a batchelor suite in Vancouver is $750 http://vancouver.ca/commsvcs/housing/pdf/2008cmhcdata.pdf. http://www.cbc.ca/consumer/story/2010/01/26/consumer-home-affordability.html My research did not take into account the small percentage of those on welfare in subsidised housing, the permanently disabled, or seniors getting housing assistance. Just in BC, which has a low population, the amount over seven years was $7 billion.

$7 billion in welfare money that went directly back into the economy. I didn’t try to figure out the amount that goes to utilities, to grocery stores, etc.

My point, in telling you that, is that increasing welfare payments, while controlling the other costs, is a major way to promote the prosperity of the working class. Because that money goes directly back into the economy. People can’t live in their welfare cheques. They can’t eat it. They can’t run a toaster off it. We never discuss welfare as the subsidy to everyone that it is. Welfare is not just for the people collecting it. Welfare is an excellent distraction, but the govt knows it can never scrap it, because it’s a huge subsidy. If they took it away, the whole system would crash, and not just those on the bottom rung. But as long as we see it as cash outflow instead of the boon that it is, and as long as those collecting it are demonised, and not the rest of us, then the government has an excellent cover for the fact that capitalism is an absolute failure.

And for those who hate welfare recipients, you get the money back. Understand?

I have more to say about the rich guys charity thing, but I have ranted enough for one night tongue rolleye . (Sorry, I do get on a roll sometimes.)


I completely agree, by the way, that $1 million is hardly wealthy any more. Well, in savings. One million in yearly salary would likely be.

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Posted: 08 February 2011 04:15 PM   [ Ignore ]   [ # 6 ]
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Oh, those poor rich people, they just have to fend for themselves with Obama in power trying to distribute the wealth.

Fact is that taxation is at its lowest since 1956 !!!!!!!

But where are the jobs which are supposed to be created by tax cuts for the rich. Seems all that money ended up in the bank account of those “job creators”, in China.

[ Edited: 08 February 2011 04:19 PM by Write4U ]
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Posted: 08 February 2011 04:16 PM   [ Ignore ]   [ # 7 ]
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Write4U - 08 February 2011 04:15 PM

Oh, those poor rich people, they just have to fend for themselves with Obama in power trying to distribute the wealth.

Fact is that taxation is at its lowest since 1956 !!!!!!!

..not to mention, I believe our tax rate is the lowest of all industrialized nations.

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Posted: 09 February 2011 10:26 AM   [ Ignore ]   [ # 8 ]
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asanta - 08 February 2011 04:16 PM
Write4U - 08 February 2011 04:15 PM

Oh, those poor rich people, they just have to fend for themselves with Obama in power trying to distribute the wealth.

Fact is that taxation is at its lowest since 1956 !!!!!!!

..not to mention, I believe our tax rate is the lowest of all industrialized nations.

And working class wages have not gone up in real terms since the “Regan Revolution,” while the share of income going to the top 1% of income earners has increased substantially.

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Posted: 09 February 2011 02:57 PM   [ Ignore ]   [ # 9 ]
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asanta - 08 February 2011 04:16 PM
Write4U - 08 February 2011 04:15 PM

Oh, those poor rich people, they just have to fend for themselves with Obama in power trying to distribute the wealth.

Fact is that taxation is at its lowest since 1956 !!!!!!!

..not to mention, I believe our tax rate is the lowest of all industrialized nations.

I haven’t vetted this but my co-worker was telling me about something he read that claimed the most robust point in our economy was when the wealthiest were taxed the highest. Rather than give their money to the government they would invest it into businesses to obtain tax breaks.

Seems logical. (Again, I’m only repeating something I heard.)

BTW: Why do “we” have a such a hatred of taxes? While there will always be disagreement over some things which tax money is used for, I think there are many things most people don’t really mind. I want the police to help me if I need them. I want the firefighters to put out fires. I like having nice parks. I like driving on roads. And many other things.

What I find completely illogical are the people who seem to like all those things as well, but do not want to have to pay for them. <shrug> (Or perhaps it’s more of “they” want someone else to pay for them.)

Take care,

Derek

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Posted: 11 February 2011 11:52 AM   [ Ignore ]   [ # 10 ]
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harry;

What I find completely illogical are the people who seem to like all those things as well, but do not want to have to pay for them. <shrug> (Or perhaps it’s more of “they” want someone else to pay for them.)

I think that these people (the basis for the tea party) goes back, at least partially, to the fact that working class wages and standard of living have not increased since the 70s.  When these people (including myself) are hit with increased taxes it comes with a direct hit on their budgets, reducing their standard of living.  If you are among the wealthy whose real income levels have been rising, the tax increase doesn’t reduce your standard of living but only slows the increase.

The Tea partier’s may be wrong in their solutions, but I think they are reacting to a very serious problem in the US.

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Posted: 11 February 2011 02:32 PM   [ Ignore ]   [ # 11 ]
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harry canyon - 09 February 2011 02:57 PM

BTW: Why do “we” have a such a hatred of taxes? While there will always be disagreement over some things which tax money is used for, I think there are many things most people don’t really mind. I want the police to help me if I need them. I want the firefighters to put out fires. I like having nice parks. I like driving on roads. And many other things.

What I find completely illogical are the people who seem to like all those things as well, but do not want to have to pay for them. <shrug> (Or perhaps it’s more of “they” want someone else to pay for them.)

Take care,

Derek

In California we have many stories of politicians living the good life on our tax dollar. Our freeways are congested. Police say they are too busy to go after criminals. One third? of our tax dollar goes to education, more then 1/3 of the kids in California won’t graduate. much of the rest goes to Government union workers health care and retirement pension at 55.

The more tax money our state government gets, the more they seem to waste. California is already one of the highest taxed states in the nation and we get no benefits for it.

Why would I want to pay more taxes to help some politicians live the good life or support some government cubical workers retirement?

I don’t mind taxes as long as government makes responsible use of that money. That doesn’t seemed to be the case as far as California goes.

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Posted: 11 February 2011 03:13 PM   [ Ignore ]   [ # 12 ]
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Bees Mom - 30 January 2011 01:43 AM

It is within the capacity of the government to increase wages, control housing costs and provide affordable housing, provide medical care, provide education, and provide adequate funds to those in need. The idea that wealth distribution is more complicated than controlling how much those at the top make at the expense of their workers is fallacy. Those tasks, as far as I am concerned, should be the main goals and purpose of government.

Sure it is. I lived in Australia for a while. Health and education is taken care of by the government. In the US we’re screwed. People have found ways to make themselves rich off the tax dollar. If the US government used the tax dollar responsibly it’d be a different story. Taxes are fairly high in Australia but no one complains because they understand the benefits they receive. 

In Germany, any business with more than five employees has a workers council, that not only represents the employees with the employer, but they are held accountable for the success of the business. Surely such a plan is feasible for the US? And Canada?

IDK, Politicians and Financial Business institutes got greedy in the US. However we have an abundance of cheap junk, cheap food and cheap entertainment. It keeps the masses quiet.

A few years ago, I wrote a research paper on how much welfare money, in BC, was paid into the local economy through rental payments over a seven year period. The figure I came out with was low in to what would actually be paid. I only included employable people, and only calculated the actual amount welfare gives for rent, when people actually pay more. For instance, welfare in BC pays a single mother with one child $525 a month for rent. The average cost for a batchelor suite in Vancouver is $750 http://vancouver.ca/commsvcs/housing/pdf/2008cmhcdata.pdf. http://www.cbc.ca/consumer/story/2010/01/26/consumer-home-affordability.html My research did not take into account the small percentage of those on welfare in subsidised housing, the permanently disabled, or seniors getting housing assistance. Just in BC, which has a low population, the amount over seven years was $7 billion.

$7 billion in welfare money that went directly back into the economy. I didn’t try to figure out the amount that goes to utilities, to grocery stores, etc.

My point, in telling you that, is that increasing welfare payments, while controlling the other costs, is a major way to promote the prosperity of the working class. Because that money goes directly back into the economy. People can’t live in their welfare cheques. They can’t eat it. They can’t run a toaster off it. We never discuss welfare as the subsidy to everyone that it is. Welfare is not just for the people collecting it. Welfare is an excellent distraction, but the govt knows it can never scrap it, because it’s a huge subsidy. If they took it away, the whole system would crash, and not just those on the bottom rung. But as long as we see it as cash outflow instead of the boon that it is, and as long as those collecting it are demonised, and not the rest of us, then the government has an excellent cover for the fact that capitalism is an absolute failure.

And for those who hate welfare recipients, you get the money back. Understand?

Yes, no. maybe. It’s not the welfare recipient that is the problem. I think maybe that idea is use to deflect from the real problem of government/business waste and greed. Though some probably buy that as the real problem. Even the administration of welfare cost little. However “If you complain about taxes it because you don’t care about the needy”. That’s how it’s presented to make those who question the governments need for more money feel guilty.

I have more to say about the rich guys charity thing, but I have ranted enough for one night tongue rolleye . (Sorry, I do get on a roll sometimes.)


I completely agree, by the way, that $1 million is hardly wealthy any more. Well, in savings. One million in yearly salary would likely be.

People fear the cost of socialism. We are already paying the cost and getting almost nothing for it. In the US higher taxes means the rich get richer. The redistribution is from the private citizen into the politician’s pocket. And we get our fast food, flashy movies and debt.

The US is losing to the rest of the world in education and health of it’s citizens. Giving more money to the government isn’t going to fix that while the government itself is the cause of the problem.

Same thing happened to Rome. It became a place of excessive food and entertainment. The people got greedy and lazy and failed to support the basic needs of a civilized society. We done this to ourselves and I don’t know if it can be fixed.

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Posted: 11 February 2011 03:23 PM   [ Ignore ]   [ # 13 ]
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Gnostikosis - 11 February 2011 03:13 PM

Yes, no. maybe. It’s not the welfare recipient that is the problem. I think maybe that idea is use to deflect from the real problem of government/business waste and greed. Though some probably buy that as the real problem. Even the administration of welfare cost little. However “If you complain about taxes it because you don’t care about the needy”. That’s how it’s presented to make those who question the governments need for more money feel guilty.

Yes, it’s unfortunate that most don’t understand who’s in what position at the trough.

Gnostikosis - 11 February 2011 03:13 PM

People fear the cost of socialism. We are already paying the cost and getting almost nothing for it. In the US higher taxes means the rich get richer. The redistribution is from the private citizen into the politician’s pocket. And we get our fast food, flashy movies and debt.

The US is losing to the rest of the world in education and health of it’s citizens. Giving more money to the government isn’t going to fix that while the government itself is the cause of the problem.

Same thing happened to Rome. It became a place of excessive food and entertainment. The people got greedy and lazy and failed to support the basic needs of a civilized society. We done this to ourselves and I don’t know if it can be fixed.

I would like to see govts become larger employers, but I agree that the as the system is now, extra money won’t help. I think not having a centralised govt would. People are too removed from actively participating in govt when the central federal govt is thousands of miles away from them.

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Posted: 11 February 2011 05:57 PM   [ Ignore ]   [ # 14 ]
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Gnost:

People fear the cost of socialism. We are already paying the cost and getting almost nothing for it. In the US higher taxes means the rich get richer. The redistribution is from the private citizen into the politician’s pocket. And we get our fast food, flashy movies and debt.

I think that is to limited.  Sure many of the politicians get rich, particularly when they retire to become consultants and/or write biographies.  But the real wealth flows through to that group that is in the top 0.1% economically, which is why they buy the politicians to start with.

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Posted: 14 February 2011 03:25 PM   [ Ignore ]   [ # 15 ]
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Gnostikosis - 11 February 2011 02:32 PM
harry canyon - 09 February 2011 02:57 PM

BTW: Why do “we” have a such a hatred of taxes? While there will always be disagreement over some things which tax money is used for, I think there are many things most people don’t really mind. I want the police to help me if I need them. I want the firefighters to put out fires. I like having nice parks. I like driving on roads. And many other things.

What I find completely illogical are the people who seem to like all those things as well, but do not want to have to pay for them. <shrug> (Or perhaps it’s more of “they” want someone else to pay for them.)

Take care,

Derek

In California we have many stories of politicians living the good life on our tax dollar. Our freeways are congested. Police say they are too busy to go after criminals. One third? of our tax dollar goes to education, more then 1/3 of the kids in California won’t graduate. much of the rest goes to Government union workers health care and retirement pension at 55.

The more tax money our state government gets, the more they seem to waste. California is already one of the highest taxed states in the nation and we get no benefits for it.

Why would I want to pay more taxes to help some politicians live the good life or support some government cubical workers retirement?

I don’t mind taxes as long as government makes responsible use of that money. That doesn’t seemed to be the case as far as California goes.

I’m in California as well. smile

Just to be clear I’m not advocating paying more taxes per se, only that some taxes and what they pay for aren’t bad and benefit a large segment of the population.

You seem to be saying it’s not the taxes in and of themselves, just the irresponsible way in which some (most? smile) politicians squander some of that money? If my understanding is correct, I agree completely. I certainly don’t want to pay taxes for the “sake of paying taxes”.

Simple (and certainly not original on my part) but equitability of tax responsibility is always an issue, for example: Prop 13. Merely by virtue of when someone bought their house determines their property tax liability. We pay about $2500 a year in property taxes. Our neighbor whose house (is on a slightly smaller lot) with an identical layout and square footage pays about $400 a year. Simply because the house has been in the family since before 1978 (or thereabouts, I don’t remember the exact date). Both houses have pretty close to equal market value, yet we pay so much more in property tax.

I also recall that Prop 13 was a response to politicians abusing the collection of property taxes by continually raising them to increase revenue. I don’t think politicians should just have the ability to get more from their constituents willy-nilly, but something as lop-sided as Prop 13 hardly seems like the answer.

Edit: I’ve certainly heard the term “working class”, but I’m honestly not exactly sure what type of jobs that refers to… Is this mostly traditional “blue collar” jobs? “White collar” is more management or work with less tangible results. Could any of the “white collar” jobs be “working class”? Thanks for any information.

Edit2: So dictionary.com has this definition:

1. those persons working for wages, especially in manual labor.
2. the social or economic class composed of these workers.

So being a software tester, I’m not working class, correct? However, I’m certainly not in any way wealthy, at least financially (to be a bit philosophical grin).

Take care,

Derek

[ Edited: 14 February 2011 03:43 PM by harry canyon ]
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