"Five-point plan for fixing all the economic problems in America"
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Author Topic: "Five-point plan for fixing all the economic problems in America"  (Read 1931 times)
greenforest32
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« on: October 24, 2013, 12:28:54 AM »

http://www.slate.com/blogs/moneybox/2013/10/23/how_to_fix_everything.html

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Author expands on the steps in the article.
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RI
realisticidealist
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« Reply #1 on: October 24, 2013, 12:40:54 AM »
« Edited: October 24, 2013, 12:47:21 AM by realisticidealist »

I was actually just about to post this. I think they're some interesting ideas in there. I'm moving onto the upzoning bandwagon, and I like his attitude on immigration, population growth, and copyrights. I need to look into land value taxes more, but they sound good in principle. I also need to look more into NGDP targeting, though it also sounds good at first blush.
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TNF
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« Reply #2 on: October 24, 2013, 06:06:00 AM »

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek
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opebo
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« Reply #3 on: October 24, 2013, 07:06:47 AM »

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek

Beautiful!
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DC Al Fine
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« Reply #4 on: October 24, 2013, 07:19:38 AM »

What's upzoning?
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RI
realisticidealist
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« Reply #5 on: October 24, 2013, 09:12:05 AM »
« Edited: October 24, 2013, 09:14:59 AM by realisticidealist »


Allowing for more dense structures to be built in previously less dense areas. Specifically, it's referring to taking areas in cities and suburbs that were zoned only for single family residences and allowing for taller apartments and multi-family residences to be built in the area as well. The idea is that this would lower costs of living in an urban area by providing more affordable housing for middle class individuals and families who might not be able to affordable a house in a big, high priced city.

For example, Seattle is zoned overwhelmingly for single family residences, meaning that if you want to live and work in the city, you have to either buy a house or choose from a small pool of expensive apartments. If you upzone, there should be more housing available, increasing supply and lowering costs of living.
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RI
realisticidealist
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« Reply #6 on: October 24, 2013, 09:21:26 AM »

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek

So wait, you think you can stimulate demand and reduce unemployment while increasing taxes, increasing business costs, and lowering hours available to work? That's outright laughable.
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opebo
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« Reply #7 on: October 24, 2013, 09:56:10 AM »

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek

So wait, you think you can stimulate demand and reduce unemployment while increasing taxes, increasing business costs, and lowering hours available to work? That's outright laughable.

Taxes on the wealthy have no effect on demand, nor do business costs,
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RI
realisticidealist
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« Reply #8 on: October 24, 2013, 11:05:50 AM »

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek

So wait, you think you can stimulate demand and reduce unemployment while increasing taxes, increasing business costs, and lowering hours available to work? That's outright laughable.

Taxes on the wealthy have no effect on demand, nor do business costs,

Do the wealthy not spend money on consumption? Do the wealthy not employ people? Even if they spend marginally less on consumption under a higher tax, that's still a drag on demand. I understand wanting higher taxes on the wealthy, but you can't have it both ways.

Business costs don't directly affect demand, but higher business costs either mean higher prices or lower employment, both of which lower real income and thus indirectly demand.
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traininthedistance
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« Reply #9 on: October 24, 2013, 11:34:15 AM »
« Edited: October 24, 2013, 11:36:41 AM by traininthedistance »

I tend to agree with Yglesias on most policy issues. His headline exaggerates (obviously he's aware of this), but this is a good summary of some of his best ideas.

Yeah, same here.  Shocking innit?
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opebo
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« Reply #10 on: October 24, 2013, 12:33:12 PM »

Do the wealthy not spend money on consumption?

Inconsequential percentages of their vast incomes, obviously - thus unaffected by taxation.


No, the State employs people by creating demand.  The rich are just a wasteful middleman in the process.

Even if they spend marginally less on consumption under a higher tax, that's still a drag on demand. I understand wanting higher taxes on the wealthy, but you can't have it both ways.

Dude you tax away the money they would hoard, and redistribute it to the poor, who spend all of it.  The net effect on demand is a huge increase.
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20RP12
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« Reply #11 on: October 24, 2013, 03:09:07 PM »

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek

I shed a tear. This is beautiful.
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DC Al Fine
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« Reply #12 on: October 24, 2013, 03:26:32 PM »


Allowing for more dense structures to be built in previously less dense areas. Specifically, it's referring to taking areas in cities and suburbs that were zoned only for single family residences and allowing for taller apartments and multi-family residences to be built in the area as well. The idea is that this would lower costs of living in an urban area by providing more affordable housing for middle class individuals and families who might not be able to affordable a house in a big, high priced city.

For example, Seattle is zoned overwhelmingly for single family residences, meaning that if you want to live and work in the city, you have to either buy a house or choose from a small pool of expensive apartments. If you upzone, there should be more housing available, increasing supply and lowering costs of living.

Excellent idea. Rowhouses are the happy medium for space and affordability. This sort of building would be welcome in places where decent homes with reasonable commutes are unaffordable for the lower middle class. (Ex: SF & NYC)
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barfbag
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« Reply #13 on: October 24, 2013, 04:33:59 PM »

The only way to fix the economy is to let the economy fix itself. Having said that, modifying tax brackets, cutting spending, allowing for free trade, and eliminating the corporate tax in order to bring back jobs from overseas helps, but supply and demand is the only way any economy has ever worked. Lower wages could actually lead to lower prices which inflates the value of the dollar. For now I'd say leave the minimum wage alone or maybe raise it closer to $8.00/hour though. We need a lockbox on social security and Medicare in order to preserve retirement. Medicaid should be expanded to compensate those with pre-existing conditions while not allowing them to be denied for coverage. Things like the Obama Stimulus from 2009 and Cash for Clunkers aren't bad ideas either and helped more than I expected along with the auto bailouts. Radical plans lead to very bad results though. Moderation and centrist economic agendas are the theories which best support supply and demand.
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Comrade Funk
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« Reply #14 on: October 24, 2013, 06:36:09 PM »

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek
More than doubling the minimum wage? Talk about a way to completely ruin the middle class.
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barfbag
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« Reply #15 on: October 24, 2013, 07:39:27 PM »

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek
More than doubling the minimum wage? Talk about a way to completely ruin the middle class.

Doubling the minimum wage doubles prices too. Thinks about that!
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RI
realisticidealist
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« Reply #16 on: October 24, 2013, 08:51:42 PM »

Radical plans lead to very bad results though. Moderation and centrist economic agendas are the theories which best support supply and demand.

I'm not sure what you're going for here. "Supporting" supply and demand doesn't really mean anything, and even if it did, it wouldn't be a goal. The goal(s) of economic policy is not a set thing. There is no one measure to target; we can choose from maximizing welfare, maximizing efficiency, maximizing efficacy, targeting some numerical measure, or some combination thereof, but we can't choose "support[ing] supply and demand." Supply and demand are mechanistic models of how economic forces interplay with each other. They provide a framework for tackling economic questions. Furthermore, a small or a large change in policy both have impacts that can be looked at from the perspective of supply and demand; a large change in policy is no more or less "harmful" to supply and demand than a small change because you can't "harm" them. You can "harm" output, rates, prices, etc. from a normative perspective, but you can't harm a mathematical relationship.

Second, you make out supply and demand to be the end-all-be-all of economics, but it is a well-accepted fact that private supply and demand are anything but. Systemic market failures exist and are well documented, and it is also well-accepted that intervention can increase welfare, efficiency, etc. to correct these failures. Leaving the market alone is not a neutral action; rather, it is a purposive action that often does not create an optimal outcome.

Third, "moderate" action which you seemed to have defined as a standard "conservative" platform, is simply not the best course of action simply because it has minimal impacts. That's ridiculous. What is the best course of action (relative to a desired outcome) in a specific situation and its consequences can be empirically shown through economics; in fact, economics has whole branches specific for such things. Cutting spending, for example, is not an objectively "good" thing that will fix the economy, and neither is removing the government from it; rather, economics can determine through rational, mathematical, and scientific processes what preferable actions are, and they rarely align with one particular ideology.

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek
More than doubling the minimum wage? Talk about a way to completely ruin the middle class.

Doubling the minimum wage doubles prices too. Thinks about that!

Empirically, the relationship is a bit more complicated than that, though prices do increase.
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snowguy716
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« Reply #17 on: October 24, 2013, 09:09:56 PM »

1.  Guaranteed minimum income for all adults.  This is a largely redistributive policy that would drag the poor out of poverty and allow them to live with dignity, whether they work or not.  This is not to be taken as rewarding laziness or idleness.  because

The B side of this policy would be to lower the minimum wage to a minimal level.  This combo would push up wages for manual, crappy jobs and would thus encourage technological advancement and automation in these fields.  Meanwhile, low paying/high non-monetary reward things like the arts would be open to everyone since they have a guaranteed minimal income (not a luxurious one.. but one that affords basic housing, food, personal products).  The "market" would allow the truly talented people to succeed financially while those who might love art, but just suck at it, to give it a go without risking abject poverty.

2.  Get rid of "right to work" laws.  If a business enters into a contract with a union demanding that workplace not to hire non-union members or non-dues paying employees, then the government should help enforce such a contract. 

3.  Make taxes progressive in a way that still encourages creativity, talent, and skill by financially rewarding those things... but also strongly discourages the hapless banking of wealth.  This means a higher estate tax (not punitive, but higher than it is now).  It would also mean heavily taxing business profits not invested back into the business (Companies could escape this by paying a dividend to shareholders, investing in capital improvements in the business, or paying the profits out to employees).  If they wanna cheat by just paying their execs massive sums... well, that'll be captured by a higher, more progressive income tax that includes all forms of income regardless of source.

4.  Fund large scale infrastructure improvements.  This is not an issue of "can we afford it".. it's an issue of "we can't afford not to".  Major upgrades to our electricity infrastructure are necessary.. along with a massive replacement program for our aging sewers and water pipes.  Gas taxes would probably treble and taxes on diesel would go up as well.  Trucking companies would be forced to pay a significant chunk of road upgrades to make freight railroads even more competitive.. so we can rely on a system of air or rail for any movements of freight more than 100 miles with trucking becoming a pick up point/dispersal method of delivery at the end of logistics lines.

High speed rail would be aggressively developed in the Northeast, Southeast, Midwest, and west coast with at least one state of the art long distance line running from coast to coast that could get you from New York to LA in less than about 9 or 10 hours (basically they'd be overnighters).

5.  Like TNF suggested... reduce the full time work week.  I'd say first to 35 hours and then eventually to 30 with hours up to 40 being paid at time and a half, with anything over 40 being double time. 
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snowguy716
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« Reply #18 on: October 24, 2013, 09:13:18 PM »

Also:  You'd be surprised at how productive the impoverished can be even if they don't hold a job.  Doing things like making fashionable purses out of plastic bags and knitting and sewing... things they can make a little money doing on the side even as they raise their children.

Imagine if the mom and kids had enough high quality food, decent housing, and good schools for the kids with after school enrichment programs... and mom could save up to buy the kids bikes or save up to send them on the annual trip to the amusement park by selling handicrafts that she made in her spare time?

You're talking about giving people dignity even if you feel they don't deserve it.  You'd be surprised at the positives that could come from that.
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barfbag
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« Reply #19 on: October 25, 2013, 03:10:53 AM »

Radical plans lead to very bad results though. Moderation and centrist economic agendas are the theories which best support supply and demand.

I'm not sure what you're going for here. "Supporting" supply and demand doesn't really mean anything, and even if it did, it wouldn't be a goal. The goal(s) of economic policy is not a set thing. There is no one measure to target; we can choose from maximizing welfare, maximizing efficiency, maximizing efficacy, targeting some numerical measure, or some combination thereof, but we can't choose "support[ing] supply and demand." Supply and demand are mechanistic models of how economic forces interplay with each other. They provide a framework for tackling economic questions. Furthermore, a small or a large change in policy both have impacts that can be looked at from the perspective of supply and demand; a large change in policy is no more or less "harmful" to supply and demand than a small change because you can't "harm" them. You can "harm" output, rates, prices, etc. from a normative perspective, but you can't harm a mathematical relationship.

Second, you make out supply and demand to be the end-all-be-all of economics, but it is a well-accepted fact that private supply and demand are anything but. Systemic market failures exist and are well documented, and it is also well-accepted that intervention can increase welfare, efficiency, etc. to correct these failures. Leaving the market alone is not a neutral action; rather, it is a purposive action that often does not create an optimal outcome.

Third, "moderate" action which you seemed to have defined as a standard "conservative" platform, is simply not the best course of action simply because it has minimal impacts. That's ridiculous. What is the best course of action (relative to a desired outcome) in a specific situation and its consequences can be empirically shown through economics; in fact, economics has whole branches specific for such things. Cutting spending, for example, is not an objectively "good" thing that will fix the economy, and neither is removing the government from it; rather, economics can determine through rational, mathematical, and scientific processes what preferable actions are, and they rarely align with one particular ideology.

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek
More than doubling the minimum wage? Talk about a way to completely ruin the middle class.

Doubling the minimum wage doubles prices too. Thinks about that!

Empirically, the relationship is a bit more complicated than that, though prices do increase.

I'm not that conservative on economics. I'm center-right like I am on most things because it works best. There shouldn't be a set goal for example; "our goal is to create x amount of jobs or this tax cut will increase federal revenue by x." There is no way to predict such a thing. The cold hard truth is that in the private sector, not everyone makes it and for them we have safety nets such as WIC, food stamps, Medicaid, and welfare. Low taxes, free trade, minimal tariffs, and the right to work are what's best for the economy. We don't want a complete laissez-faire where there's environmental hazards or child labor either. The truth is somewhere in the middle.
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LastVoter
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« Reply #20 on: October 25, 2013, 03:59:23 AM »

1. Raise the minimum wage to $15 an hour
2. Aggressively promote unionization and protect union workers
3. Implement confiscatory taxation rates at the upper end of the spectrum
4. Push unemployment as close to 0% as possible with a $1 trillion stimulus package
5. Move to a 30 hour workweek

So wait, you think you can stimulate demand and reduce unemployment while increasing taxes, increasing business costs, and lowering hours available to work? That's outright laughable.

Taxes on the wealthy have no effect on demand, nor do business costs,

Do the wealthy not spend money on consumption? Do the wealthy not employ people? Even if they spend marginally less on consumption under a higher tax, that's still a drag on demand. I understand wanting higher taxes on the wealthy, but you can't have it both ways.

Business costs don't directly affect demand, but higher business costs either mean higher prices or lower employment, both of which lower real income and thus indirectly demand.
The money taxed will be spent by the state...
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barfbag
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« Reply #21 on: October 25, 2013, 01:22:39 PM »

The money taxed will be spent by the state...
[/quote]

It should be more spent by the private sector because we the people earn the money.
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President Tyrion
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« Reply #22 on: October 25, 2013, 01:32:43 PM »

For the record, upzoning is almost certainly impractical for the amount of opposition it will cause. It would have already been done if not for community groups (NIMBY) essentially preventing their property values from decreasing. It doesn't necessarily matter that society would benefit from such a program. This is a good example of an implicit cost borne by society due to property rights, which is not something people generally talk about. I'm not saying it's necessarily a good thing or a bad thing, before people accuse me of being some sort of Marxist, but it is quite clearly a thing.
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tik 🪀✨
ComradeCarter
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« Reply #23 on: October 29, 2013, 06:41:25 AM »

The money taxed will be spent by the state...

It should be more spent by the private sector because we the people earn the money.
[/quote]

Money spent by the government ends up back in the private sector, barfbag. It ends up in the pockets of "We the People" who are employed or contracted by the government. That is, it goes to private citizens and businesses. It doesn't evaporate. An economy is a machine - whether the private or public sector is or should be mainly producing the electricity to keep it in motion is a matter of debate, but both end up feeding into each other regardless.
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Cassius
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« Reply #24 on: October 29, 2013, 07:54:04 AM »

Five point plans to 'fix' the economy usually end in failure.
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