American Budget Cuts

Are you saying you can't tell the difference between an investment and "spending"?Whats the difference between the income produced by manual labor and the income produced by the return on financial investments? Why are you equating an increase in GDP with investment in American workers? Is that truly the only way you understand that GDP can increase? Thats still false. I'm not just going to go along with your mistake because you insist others have made the same mistake.Furthermore you haven't actually outlined how this "theft" is taking place. How exactly are the wealthy stealing all this money?

Yes. Capital gains are the result of selling for more than you purchased for. The growth or decline in the value of a stock may have many causes, one of which is increased earnings. But an earning company can still lose stock value if people believe it may earn less in the future, or if many people try to sell all at once, or even for no reason at all like what happened in last May when a computer programming bug resulted in the single largest single-day losses in the entire history of the Dow Jones stock exchange. Well, "animal spirits", technically: Blue. How long do most people hold stocks in your parallel universe? As I mentioned, it's about eleven seconds in mine. Unlike others in this thread I've made no particular claims of expertise, except for knowing how to read. And I know the difference between the economics that is actually a real picture of how wealth is allocated and distributed in an economy, and the "economics" that is nothing more than bullshit meant to reinforce someones ideological preferences about the distribution and redistribution of wealth.

The source of the income. One is payment for labor, and the other is repayment of what is basically a loan. I'm not. You're the one saying that the GDP increase was primarily captured by the rich because it was the return on an investment they made. The source of the GDP increase was increased productivity by the American workforce, as you've already agreed. We're just at a disagreement about who should reap the benefits of the increase. I believe that a person is entitled to the sweat of their brow, I believe that people who earn money should get money, and I believe that the redistribution of wealth is anti-American. You're some kind of socialist who believes that the rich are entitled to wealth they didn't earn simply by virtue of being alive.Well, you don't say that, of course. What you said is that the rich are entitled to the increase because it's the return on an investment they made. Since the money came from the American worker you're implictly saying that the investment was in the American worker. (I can't collect money from Apple for money I invested in Microsoft, right?) I'm challenging that they actually made such an investment.Since you're the one saying they did, I'm the one asking you for evidence. No, not at all. But we've already agreed that in this case, the increase in GDP was the result of widespread productivity gains in nearly every aspect of the American workforce.That's settled. You agreed on it, and it happens to be true. Ask any economist. None of them will tell you that the increase in GDP was the result of American workers remaining exactly equally productive, but the top 1% income earners becoming almost a million times more productive, apiece. That's so patently stupid that nobody would suggest it.So, what we're talking about is the top 1% of Americans collecting the rewards for a 220% increase in productivity by just about everybody. My claim is that that's a form of theft, because people who increase their own productivity should be rewarded for it. Your claim is that all those gains were the result of an investment in the American worker made by those top 1%, and that the transfer is simply the payment on that investment.Well, ok. Let's examine your claim! When was the investment made, and what were it's terms? If you dig into somebody's wallet and take the money, and then when you get caught you claim that you're simply taking what's owed you, based on an investment you once made in the owner of the wallet, you'd better be prepared to show that the investment was actually made and that this repayment was a term of the deal. No, it's true. We've established it; that's why the rich are getting richer and the middle class is shrinking. Nobody disputes that there's been an enormous wealth transfer from the middle class to the rich. Certainly not you - your contention is that the rich have gotten so much richer on the basis of an enormous return on investment, not that they've not gotten any richer at all. That's not really in the scope of the discussion.

How so? Increases in GDP do not solely come from increases in the productivity of the American worker. Why? Lets look at the Real GDP and population growth from 1970 to 2009.Relative to the value of the dollar in 2005, in 1970 the average worker's share of the GDP was $20,819.74. In 2009 it was $41,890.45. Are you suggesting that the average American worker somehow managed to increase the yield of "the sweat of their brow" by a little more than double simply through working harder?What do you think the figures were for the previous 40 years? Just under 3 times greater; exactly how little do you think people worked back then? Oh I see how it is."They are stealing from us!"
"Oh really, how?"
"Well... I have less money than I think I should have! Everything else is kinda fuzzy..."

That's right. A sole owner cannot be convicted of embezzlement against himself. If the business is not a sole proprietorship, then he is stealing from the rest of the ownership and that is embezzlement. BS. You really are that stupid.I'm done.

Earlier you said: If I have understood what you are saying then isn't it inevitable that wealth gets ever and ever more concentrated?If money itself is equivalent to "effort" then the richest will expend the most "effort" and produce the most and make the most money. Then they will be even richer. So they can put in even more "effort" and produce even more and make even more money. And so on and so forth.Don't we just end up in a self-re-enforcing spiral whereby wealth is inevitably concentrated almost exclusively amongst a tiny minority?And if this wealth is then passed down the generations within a family you end up with a situation where the tiny minority of people who own practically everything have never actually put in any real effort into anything.Or have I misunderstood what you are saying?

What?? How about suggesting that $20,000 in 1970 is not equivalent to HALF of $40,000 in 2009 dollars!No wonder you can't quite understand how squeezing the middle class leads to a poorer economy.

Not necessarily. Its always possible for someone to be an idiot and lose their fortune. In the slightly longer term fortunes can be broken up among offspring. If you allow people to keep the fruits of their labor then yes. Those people are in essence standing on the backs of their ancestors. This in no way hinders the ability of others to get ahead and to make their fortunes, and in fact it makes it easier due to the vast amounts of investment capital available.But I suspect you are going to whine about how its terrible you can't have their money. That those of our current generation who work really hard are somehow entitled to the wealth of the previous generation no matter who they were. Or that such a distribution of wealth must have terrible results for our form of government.What it comes down to is that if you let people invest in their children, their children will be better off. Either you get rid of the idea of inheritance or you will just have to deal with that fact.

I really have little intellectual respect for anyone who believes that simply letting capitalism run free will insure the best society and the greatest interests for its people, produce the best goods, and create fairness for all. It encourages nothing of the kind.What free rein capitalism encourages is short term inflation of stock prices by any means necessary, the lowest workers salary possible, and the least amount of employed people possible.If a company like McDonald's can make the most unhealthy food they are capable of producing, as long as they can produce it cheaply and people will buy it this is what they will do. If the CEO of GE can lay off 50,000 people and cause and increase of 3 % in their stock value over the next 3 years, this is what they will do. If the CEO of a decent company that makes a steady 10% profit of their business year in and year out, and can employ a large workforce in the community, can suddenly find a way to close down one of its factories to cause a sudden bump in their share price, and then retire and get out, this is what he will do, even if it destroys their annual 10% profit.There is not incentive in the capitalist system to make the best product, there is incentive to make the cheapest or most profitable. That people in a capitalist system make quality products is not the result of capitalism, it is the result of people who want to make a good product. This can occur in any system.All of those who are so in favor of privatizing any sector possible, and think that private companies can do the best job of keeping things the most secure, of producing the healthiest food, of making the safest medicines, of maintaining the safest transportation systems, or most affordable health care, or or conducting the best medical research are simply lying to themselves and the public. It is in fact anti-thematic for these companies to do so, because in the free market world NONE of these would be their goal. Their goal would be to provide the most profitable security force possible, not the safest. Their goal would be to provide the most profitable food possible, not the healthiest. Their goal would be to produce the most profitable medicine possible, not the most effective.A system such as this doesn't lead to greatness, it leads to cost cutting crap (sound familiar America? How long did it take you to destroy the made in America label?). A great society REQUIRES a government to insure that instead of the most profitable medicine, they produce the most effective medicine. A great society requires that instead of providing the most cost effective security measures, they provide the most secure ones. A great society requires that it citizens are feed healthy food, not food that makes them fat lazy and stupid.A great society is what America USED to be when the government still effectively intervened to insure quality, safety, integrity and an affordable life for as many of its citizens as possible. A great society is what America USED to be when government still provided for its people, before the Republicans slowly tore the government to shreds, and turned it into Lehman Brothers, Koch Industries, Bechtel, Haliburton and Kentucky Fucking Fried Chicken.Congratulations, you have gotten what you wished for free market, anti-regulation, corporate cheerleaders. How do you like it so far? Hope you keep your doors locked at night.

Oh come on, you even quoted it: "Relative to the value of the dollar in 2005..." All of those figures were relative to that value. The figures are about "real GDP" converted to a common standard and adjusted for population so it was actually a useful statistic.If you aren't going to bother to read there isn't much help I can offer on a text-based forum.

The point you were missing was that those figures have no meaning whatsoever in regards to modern life. They are akin to every other form of meaningless spun numbers that can be found on any daily Fox News broadcast and have absolutely zero value for drawing conclusions about anything. They are adjusted to fit whatever one wants them to fit. Are they from the Heritage Foundation?

So we are relying on idiocy (or the failure of the rich to invest in financial safeguards) to stop the runaway wealth concentration I described? Short of such idiocy the richest 1% will rightfully just get ever more wealthy as far as you are concerned? Even if the human population remained static (and it seems generally accepted to be exploding) that would hardly reverse the trend of wealth resource being ever more concentrated in the hands of a miniscule minority that your description thus far seems to all-but inevitably result in. Would it?

Who are you to say what people should eat? If they want to eat cheap, unhealthy food then that is their choice of how to allocate their resources. Its not like healthy food isn't available to them, its just that apparently you have a problem with what you would consider a suboptimal choice even being available.Well thats freedom, get over it. I won't be lectured by a wannabe autocrat. This is actually a legitimate fear, and is one of the problems in compensation that companies and their investors take great pains to mitigate. It isn't as you suggest something to be expected or welcomed in a capitalist society. Actually there is an incentive to fill every niche. The first company will balance quality and cost to find the right balance between number of customers and price for greatest profit. The second will have to compete in some way; one will probably end up being the lowest cost producer and the other will differentiate themselves in some way, usually through quality.Look at the computer industry: Apple has a comparatively tiny amount of the market share yet they have been enormously profitable. Thats because they have grabbed a large portion of the high-end computer sales market through differentiation as the leader in quality. Quality sells. And what do people want to buy? Probably the safest security force, although to be specific they probably don't want the safest money can buy. Guarding their store with an APC and a horde of hardened former SWAT members is probably overkill.People get what they want, not some idealized extreme that makes you cream your pants when you imagine it. So people get the food they want, not the food thats theoretically best for them. Yes, they don't have Bolder-dash the autocrat lording over them deciding what they can and cannot eat. I'm having trouble imagining under what circumstances exactly people are going to of their free will purchase less effective medicines given the option.

So whats your plan, that just because your ancestors built up an infrastructure to aid you that it should be harder for you to make a profit? Or even impossible for you to just break even? Maybe not. But I notice you still haven't tackled the question of what business it is of yours that other people have wealth. Looking at everything that exists and seeing others producing more with their greater resources, and being jealous, isn't a reasonable basis for wealth redistribution.

Right, now you start to deny the economic reality. Well Bolder-dash, how about a taste of your own medicine?Your figures about GDP growth and the concentration of wealth in the hands of a minority have no meaning whatsoever in regards to modern life. You still have the same ability to increase your fortune and profit from your labor as you ever did, or as anyone does.Your spun numbers about how the wealthy are mysteriously filching from the poor, in ways you refuse to address, have absolutely zero value for drawing conclusions about anything. Actually, the particular calculator I used was developed by a pair of Economics professors from the University of Illinois at Chicago. Lawrence H. Officer and Samuel H. Williamson if you want to look them up. As for their data, its hardly a secret what with the US collecting and publishing GDP numbers and inflation rates.