Senate Income Inequality in the U.S.: Causes, Effects, Solutions

Okay, so you had a problem with my tone or source or whatever, let me ask it simply with as little personal bias as I can muster:

How is it that the "job creators" in our country are making more money than ever before yet are not hiring new people as the GOP economic model is saying they should?

 

I'd lay out four reasons:
1. Obamacare and the uncertainty it is creating about what it will cost to hire new workers as the rules on health insurance change.
2. Uncertainty about taxes - Obama's just called for a $1.5 trillion tax hike.
3. Other regulations that have come down the pike - they have to probably spend money to deal with those, as opposed to hiring new workers. The suit against Boeing by the NLRB is one such case.
4. Some of Obama's actions on domestic energy production have also hurt in this regard. Gas has gone up to $3.56 from about $2.00 when Obama took office. That is another drag on the economy.

There may also be a capital strike going on as well - one that probably began in earnest after the passage of Obamacare and Dodd-Frank, but also due to the fact that Obama has been unable or unwilling to address the above four reasons:

The existence of this huge accumulation of corporate capital in cash and marketable securities over the last three years means that the United States is experiencing a classic "capital strike." A capital strike occurs under a system of democratic capitalism where unacceptable political risk discourages private investment from taking place. The result is economic stagnation and a steady build-up of uninvested capital.

Surprise, surprise - you CAN, between calls for higher taxes and over-regulation, get business to sit on its hands and not hire people or make new investments.

 

That's all b.s. and shows a lack of understanding about how serious businesses make decisions. Small businesses in particular don't sit around wondering about the future effect of policy changes. They either have demand for their products and services, or they don't. If they're trying to guess about an uncertain future, they're trying to guess about whether 6 months down the road anyone will be buying what they're selling. Large businesses factor in the likely impact of future policy changes, and then forge ahead with forecasting and make decisions based on their forecasts. They don't sit around for years on end paralyzed by fear about one factor in their cost structure.

It's all about lack of demand. That's why we need government stimulus and why the Republicans in Congress, and the Tea Party in particular have it exactly backwards. They are as completely wrong about the economy as they could possibly be. Republicans have proved repeatedly their inability to govern.

First, during the economic expansion of 2003-2007 they cut taxes while we were paying for 2 wars and they expanded government spending by creating a brand new entitlement program and refusing to manage the deficit. Now, during a period of economic downturn and stagnation, they are trying to pull the government spending leg out from under the economy. The Republicans have got their priorities completely, 180 degrees ass backwards for two straight business cycles.

And then they are sending letters to the Federal Reserve urging it to abandon its duty to manage monetary policy. If businesses are frightened and uncertain, that's what they're uncertain about. They're terrified of what Republican budget cutting will do to the economy in the immediate and medium terms.

 

How is it that the "job creators" in our country are making more money than ever before yet are not hiring new people as the GOP economic model is saying they should?

If by "GOP model" (although thinkers like David Hume and Adam Smith might take offense to the label)- you mean supply-side economics in general, it's because of uncertainty in foreign markets due to crippling debt load coupled with increased efficiency in production of the remaining resources available. In other words, it's all Greece's fault. Or in other words, other words, no one is buying anything because everyone is scared, and what's left costs more. The Hula Hoop manufacturer isn't going to produce 500,000 Hula Hoops if only 100,000 are going to be sold. But keeping money available for things like increased innovation, capital improvement, and yes, the eventual hiring of workers makes much, much more sense at this point than "taxing the snot of corporations for no other reason than they're rich and that's unfair..." Because once you set those fixed costs, they're just that-they're fixed, and you'll actually stifle all of those things. But all of the above is just the simple answer, because there are all sorts of variables are at play here. For example, going back to those "Koch Brother" from your earlier example. If those brothers invested 34 million dollars back in 2007, just the interest return alone could account for the growth in their personal wealth, and it has nothing to do with the hiring or firing of workers in one of their companies. You didn't take any other alternatives into account with your single focused accusations. But really, it's basic causation vs correlation.

However, if by "job creators and the GOP economic model" you actually mean that "the republicans are bullcrap, who is going to worm out of that?"

I have no idea.

 

But keeping money available for things like increased innovation, capital improvement, and yes, the eventual hiring of workers makes much, much more sense at this point than "taxing the snot of corporations for no other reason than they're rich and that's unfair..."

Really MR? Because anybody in this thread has said that's the reason they think the wealthy should be taxed more? Really?

 

I think capital strikes only exist in Ayn Rand novels.

 

Really MR? Because anybody in this thread has said that's the reason they think the wealthy should be taxed more? Really?

Rachel Maddow did. So blame her and her wacky, wacky beliefs.













legal disclaimer-Rachel Maddow may or may not have actually said the above quote. The above is parody. No celebrities, either living or dead, where harmed in the writing of this post.

 

Meanwhile, welfare dollars are apparently being used at strip clubs, and to buy booze or gamble.

**** this, if that is how they are going to spend money sent to help them, then it's way past time to pull the ****ing plug. I'm sick of being told that we need to do more for the poor when they take the help they are given and blow it on strip clubs, or to buy booze or to gamble. I'm sick of it, and I'm even more sick of being LECTURED by a bunch of self-righteous liberals over this.

Oh yeah, and $600 million in benefits went to dead people. I can't even trust that the government will handle any oversight if there is correction.

It's time to end welfare payments, I no longer believe the system can be mended, and I am THROUGH with subsidizing strip club visits, booze, and bets for a bunch of moochers.

 

I want much stricter oversight, but if that oversight is not enacted soon or proves ineffective, I am willing to go the "bad apple" route.

 

Smuggler, I just looked at that article you posted about the money being withdraw from the ATM machines of strip clubs and liquor stores...and they say that it's around $190,000. I'd love to find out just how much of a percentage that represents. I mean, yeah, any waste sucks, but less than $200,000 might not be such a big deal as it requires giving everyone else the middle finger.

 

If my calculations are correct, Jedismuggler is willing to kill the national social safety net over the misappropriation of .06% of Florida's annual welfare payments. A rounding error in the state's welfare budget. Irrational, but that's how Tea Party Think works.

Edit. Sorry, I misread the article. It's $190k since 2009, so maybe .05% of welfare payments withdrawn in strip clubs and liquor stores, etc. I wonder what the percentage of people making more than $250,000 a year who cheat on their tax returns is?

 

I enjoy who the bold part shows the clear line of thinking here. There's a "they" who is a substantial group that exhibits a patern-behaviour. This "they" turns out to be "the poor" who are ... clearly ... mooching.

Outrage, I say.

Did I mention that my country is experiencing around the largest growth in Western Europe because our lack of a new, full, government means no austerity measures have been put in place. Which in turn means that our "demand" by "poor people" has not been hit nearly as hard (Welfare & pensions are tied to an index which follows inflation, woopie) ... What happened, contrary to those countries where they went with the "arghh, too much state spending, cut - cut - cut" we are now presenting around the best bloody figures in Western Europe. Last quarter, or so I read, it was around 7 times higher than Germany that quarter.

Also, here's Taiwan's favourite Second Life News show, with an informative video about it.

 

Really? Are you serious?

I will never get over people blaming the president, directly, for an increase in gas prices. Said statement also applies to those that blamed Bush. The recent high price comes from an increase in demand; as the economy "recovers" (aka gets less bad) across the globe, economic activity increases and pushes consumption up and, hence, prices. Turmoil in the Middle East also contributed. With uncertainty over how violent the protests and fighting would get, and how disruptive it would mean for supply chains, investors brought up the price of oil. It wasn't because of some domestic energy production policy that you don't like of Obama's and Glenn Beck is toting around this week as if it's the end of the world like the faux Solyndra scandal.

 

I'm not sure how you can say that's the case when schools are reducing the number of people they can take because they're facing budget cuts, while tuition also rises. That said, a point also worth noting is the difference between the costs of tuition and the costs of attending college as they're not the same. I'd like to see the numbers associated with that connection.

 

It would be lovely if it coalesced into an effective progressive counterweight to the Tea Party. Both are a manifestation of the Pitchfork Level.

The first recession and the emergence of the Tea Party brought us to the equivalent of DEFCON 4 on the Pitchfork Level. I'll call it PL 4. If Occupy Wallstreet coalesces into a national political movement, I'd say that takes us marginally into PL 3 territory with two competing anti-establishment political movements, although since the Tea Party has all but taken over the House of Representatives, I'm not sure it still counts as anti-establishment.

If we move into Great Recession Part 2 I'm sure these movements will intensify. Just so the Republicans know this is a bed of their own making, with 30 years of regression on tax policy and the ongoing, deliberate undermining of the middle class.

 

The Occupy Wall Street crowd has Soros and the Tides Foundation. That said, I see Occupy Wall Street as a huge liability for Obama. If he takes the class warfare approach, I see him losing the independents, who will likely go for the GOP candidate (Romney, although that seems to be more by default). Put it this way - rhetoric calling for the beheading of bankers is not going to sit well with most of America.

The big question is who the VP will be. I could see it being Cain, Christie, or Rubio.

If Cain is the nominee, I can see the GOP picking up a larger percentage of the African-American vote, and doing well among moderates and people worried about jobs. Similarly, if it is Rubio, I see them getting a chuck of the Hispanic vote. Christie will help the GOP nominee clean up with moderates.

 

http://www.boston.com/news/nation/articles/2011/10/03/soros_sympathizes_with_wall_st_protesters/

http://www.associatedcontent.com/article/8356611/tides_foundation_connected_to_day_of.html

And other liberal establishment groups as well, including MoveOn.org:
http://dailycaller.com/2011/10/03/moveon-org-moves-in-on-occupy-wall-street-protests/

 

And? Is this any more or less ridiculous than Faux News guzzling down teabagger ****? Oh, I know, 'Soooooorooooos!' but he isn't quite the bogeyman your militia and end times groups make him out to be.

 

When the peasants really do revolt, Soros is just another head rolling into the basket.