Economics

[Northstar]

Netherlands=tax haven

So what is your country doing to help ensure U.S. (and other countries) keep their taxable income in their countries?

 

[PocketZeven]

So what is your country doing to help ensure U.S. (and other countries) keep their taxable income in their countries?

The dutch tax loophole is something that you as a US citizen has little influence on. That is not our governments responsibility. The US itself should have policies to keep their taxable income. Dont blame the netherlands.

I am curious why do you think you think that less tax on the wealthy would help the economy?

 

[Rallywagon]

Why do you think you think that less tax on the wealthy would help the economy?

Weren't you just harping on someone about deflecting?

 

[PocketZeven]

Weren't you just harping on someone about deflecting?

I was busy writing and accidently posted. See above the complete post.

 

[GranTurNismo]

So, I was looking for a thread that I could use to further a discussion about socialism, communism, universal basic income, wealth redistribution, and all that jazz. The only thing I could find that made sense was socialism vs. communism thread that was 16 years out of use.
So, I am starting this thread as a place to discuss different economic theories. I am going to start off by continuing this discussion with @GranTurNismo.
If there is already a better thread, please move this post there. Thank you.

UBI is a really bad idea. On its own, it immediately requires a raise in tax. I think a better idea would be to reduce taxes and free up more of a worker's income for themselves. The problem as I see it with UBI is that it funds freeloaders. I am fine with forms of welfare that help those that have run into temporary misfortune, and those that are incapable of helping themselves. I'm certainly not as standoffish to taxation as Danoff. I do think the whole system needs to be reconsidered though.
Regardless. With UBI, you are literally having the government taking from those that earn and create, and redistributing it to everyone. That is just about the very definition of communism. Again, forgetting the fact that in order to pay everyone 1000 dollars or whatever arbitrary amount, everyone will have to pay 1000 dollars in, and no, corporations are not going g to pay it, as, with all things, costs incurred to a business are always reflected in their prices. Better instead would be to fix taxes so that I pay 1000 dollars, or whatever percentage, as that's more workable, less per paycheck, or whatever equivalent on 1099, etc. Taking from individuals what they have themselves earned and created, and redistributing it to the masses is a great way to reward malingering and punish hard work.

I agree that Andrew Yang's vision of a UBI (the freedom dividend) that gives every US family, regardless of income, $1,000 a month is not a good idea mainly because there are many families that simply don't need the assistance. But, I think the idea of a basic income is sustainable in principle. My vision for a UBI program technically wouldn't be "universal", since only households below the poverty line (both the employed and unemployed) would receive a monthly check. Also, the amount of money given would depend on the cost of living in a given area. For example, a San Francisco poor household would get much more per month from UBI than a household in West Virginia.

And yes, UBI would result in a slight tax increase for the middle class and rich, but is this really a bad thing? We need to drop the mindset that an increase in taxes is automatically wrong. Ultimately, we need to find a way for people to live comfortably while also paying higher taxes as well. This is already existent in Scandinavia, for example. The reason why lowering income taxes, as opposed to raising taxes while also raising the number of government services, is flawed, is because essential services become defunded. When taxes are lowered, the gov't takes in less money, and as such, must operate their services (whether it be infrastructure, military, education, welfare, etc) on a lower budget, resulting in the quality of the services to decrease, and/or people losing their jobs.

UBI would allow those in poverty more money per month, and as such, they could live more comfortably. Furthermore, they could also spend the money given to them through UBI back into the economy, which helps to "cancel out" any tax increase on corporations.

What is your definition of a "free-loader"? Is this just another name for the unemployed?

And you say that a UBI program is "penalizing those who work hard and contribute" because it helps those who supposedly "don't contribute". This is very wrong. First of all, the majority of poor people actually do have jobs and in fact, work longer hours than the average middle class or wealthy person per week. And their jobs do "contribute"; working in a factory, ringing up groceries, driving the bus, cleaning windows, caring for the elderly, etc, may not be as valued as being an engineer or doctor or lawyer, but these people still do jobs that impact our daily lives, they just don't get paid very much for it. Also, the majority of poor people who don't work are unemployed because they simply cannot work, not because they are lazy bums or "freeloaders". For example, many people with disabilities cannot work, and as such, are poor. A poor single mother might not work because caring for children without any support is tremendously hard, and childcare is very expensive. This is what people need to understand.

 

[Rallywagon]

I agree that Andrew Yang's vision of a UBI (the freedom dividend) that gives every US family, regardless of income, $1,000 a month is not a good idea mainly because there are many families that simply don't need the assistance. But, I think the idea of a basic income is sustainable in principle. My vision for a UBI program technically wouldn't be "universal", since only households below the poverty line (both the employed and unemployed) would receive a monthly check. Also, the amount of money given would depend on the cost of living in a given area. For example, a San Francisco poor household would get much more per month from UBI than a household in West Virginia.

And yes, UBI would result in a slight tax increase for the middle class and rich, but is this really a bad thing? We need to drop the mindset that an increase in taxes is automatically wrong. Ultimately, we need to find a way for people to live comfortably while also paying higher taxes as well. This is already existent in Scandinavia, for example. The reason why lowering income taxes, as opposed to raising taxes while also raising the number of government services, is flawed, is because essential services become defunded. When taxes are lowered, the gov't takes in less money, and as such, must operate their services (whether it be infrastructure, military, education, welfare, etc) on a lower budget, resulting in the quality of the services to decrease, and/or people losing their jobs.

UBI would allow those in poverty more money per month, and as such, they could live more comfortably. Furthermore, they could also spend the money given to them through UBI back into the economy, which helps to "cancel out" any tax increase on corporations.

What is your definition of a "free-loader"? Is this just another name for the unemployed?

And you say that a UBI program is "penalizing those who work hard and contribute" because it helps those who supposedly "don't contribute". This is very wrong. First of all, the majority of poor people actually do have jobs and in fact, work longer hours than the average middle class or wealthy person per week. And their jobs do "contribute"; working in a factory, ringing up groceries, driving the bus, cleaning windows, caring for the elderly, etc, may not be as valued as being an engineer or doctor or lawyer, but these people still do jobs that impact our daily lives, they just don't get paid very much for it. Also, the majority of poor people who don't work are unemployed because they simply cannot work, not because they are lazy bums or "freeloaders". For example, many people with disabilities cannot work, and as such, are poor. A poor single mother might not work because caring for children without any support is tremendously hard, and childcare is very expensive. This is what people need to understand.

If these people want to stay with entry level jobs their whole career, why is it my duty to support that? Why should I pay extra taxes for them to be happy settling and not looking to expand on their careers? Further more, if they want to stay at whatever entry level they are at, but want to make more, then dont look for a freaking hand out from the governement. Do it right way. Create unions, stage walk outs. There are a so many better, more adult options than standing there with your hand out saying "gimme"

 

[Northstar]

The dutch tax loophole is something that you as a US citizen has little influence on. That is not our governments responsibility.

Than whose is it?

The US itself should have policies to keep their taxable income. Dont blame the netherlands.

I agree, but a part of that is other countries helping create a level playing field.

I am curious why do you think you think that less tax on the wealthy would help the economy?

Just because I think taxing them more will hurt the economy, doesn't mean I think lowering them will help.

 

[GranTurNismo]

If these people want to stay with entry level jobs their whole career, why is it my duty to support that? Why should I pay extra taxes for them to be happy settling and not looking to expand on their careers? Further more, if they want to stay at whatever entry level they are at, but want to make more, then dont look for a freaking hand out from the governement. Do it right way. Create unions, stage walk outs. There are a so many better, more adult options than standing there with your hand out saying "gimme"

You use the word "want" as if those people have their low paying jobs simply because they just chose that job and can leave it for a better paying one if they just "want" to. It's nearly impossible for someone without a high-school diploma or someone who was raised in a poor neighborhood or someone who's a single mother to break the cycle of poverty. They choose these jobs because these are the only jobs they can get, not because they're "lazy" or whatnot. While I agree that mininum-wage jobs generally weren't designed to be full-time careers, unfortunately, they are full-time careers for most people who work those jobs, and that's not something that can just magically change. These people still deserve a better quality of life and basic services just like 9-5 suburban middle-class people do.

"Hand outs", lol, seems like the right-wing media's rhetoric has gotten to you. Are public schools also considered "hand outs" by that logic?

We should help the poor people because America is a like-minded community, not a nation of scattered-out individuals. Everyone deserves a fair chance at a high quality of life. If those who are poor are not assisted in some way, then how can they, and the generations to follow, break the cycle of poverty?

For example, my grandparents pay a large sum of taxes to public education, but you don't hear them complaining about it. Because they know the money goes to services that people need. Should public schools be defunded because of many of the people who pay taxes for them don't actually use them? Absolutely not, and the same applies to the richer people and corporations paying taxes for services that the poor could use.

You come across as if starting a union or walk-out is just a piece of cake. Open your eyes. These are the types of things that get workers fired, even if it's technically illegal to fire them because of it.

What are some of those options? And simply lowering taxes doesn't count.

 

[Exorcet]

No I do not hate people who earn more money. I just think that when a domestic economy rewards smart people and hard work and you are priveleged to have extreme wealth, you are in a position to contribute more to the whole society.

The bar for being able to contribute "more" is very low. Does UBI need to be funded by taxes? Why not have an optional contribution (and option to turn down receiving the funds). It seems to me that there is enough support for idea that UBI could be funded without being compulsory.

 

[Rallywagon]

You use the word "want" as if those people have their low paying jobs simply because they just chose that job and can leave it for a better paying one if they just "want" to. It's nearly impossible for someone without a high-school diploma or someone who was raised in a poor neighborhood or someone who's a single mother to break the cycle of poverty. They choose these jobs because these are the only jobs they can get, not because they're "lazy" or whatnot. While I agree that mininum-wage jobs generally weren't designed to be full-time careers, unfortunately, they are full-time careers for most people who work those jobs, and that's not something that can just magically change. These people still deserve a better quality of life and basic services just like 9-5 suburban middle-class people do.

Let me once again add this to the conversation so some of my ideologies dont continue to get misrepresented.

I am fine with forms of welfare that help those that have run into temporary misfortune, and those that are incapable of helping themselves. I'm certainly not standoffish to taxation.

I also stated that things like community colleges should have free tuition. As it is, there are generally things like the Pell grant for those that cant afford college. If you are able minded and able bodied, you absolutely can and should strive to better your situation, not rely on assistance from other. Impoverished, single parents, reformed addicts. Lots and lots of examples of them all making something better for themselves. At the end of the day, you either take responsibility and use the opportunities that are there, or you choose to be the victim.

"Hand outs", lol, seems like the right-wing media's rhetoric has gotten to you. Are public schools also considered "hand outs" by that logic?

We should help the poor people because America is a like-minded community, not a nation of scattered-out individuals. Everyone deserves a fair chance at a high quality of life. If those who are poor are not assisted in some way, then how can they, and the generations to follow, break the cycle of poverty?

I agree! I think you do that in a number of ways. Proper healthcare, better education, temporary assistance when needed. Not wealth redistribution though.

For example, my grandparents pay a large sum of taxes to public education, but you don't hear them complaining about it. Because they know the money goes to services that people need. Should public schools be defunded because of many of the people who pay taxes for them don't actually use them? Absolutely not, and the same applies to the richer people and corporations paying taxes for services that the poor could use.

that is quite the touching anecdote. Good on them.

You come across as if starting a union or walk-out is just a piece of cake. Open your eyes. These are the types of things that get workers fired, even if it's technically illegal to fire them because of it.

Yeah, fair enough. A lot of dumbasses voted in politicans that created these "right to work bills". Really shot themselves in the foot there.

What are some of those options? And simply lowering taxes doesn't count.

Lower taxes!!!!
Seriously though. We start by trimming the government fat. Reduce military spending by reducing militaries global foot print and reigning in the Pentagon. That alone is likely worth over 1 trillion a year in tax revenue. Reduce the overall size of the federal government and give more autonomy to states. Have a flat tax rate on whatever monetary variable that makes sense to people who understand that sort of thing. Close up all tax loop holes. Idk man. These complete answer to that question is definitely beyond my knowledge.

 

[Imari]

However, it should not be the governements, nor the rest of societies responsibility to take care of able bodied and minded individuals.

That's kind of the basis of a community or society, that there's some sort of interdependence. Otherwise you're just a bunch of individuals, otherwise known as anarchy.

I'm not sure if you've ever lost your job or been through a rough patch in your life, but yeah, sometimes entirely able bodied and minded people need support too. Simply being a functional human does not stop bad stuff happening, unfortunately. The world would be a better place if it did.

Specifically it's the idea of wealth redistribution and UBI that I am against. Wealth redistribution is exactly, full stop, communism.

You seem automatically against anything that could be described as communism. Certainly, communist regimes in the past have not necessarily worked particularly well overall, but one could say the same about some democratic regimes. Depending on what the goals of your society are, I think that there are some things that can be taken from communist type systems and implemented intelligently.

If one accepts that a society is a group of humans, and that groups of humans can choose to make certain concessions that are to the benefit of the group as a whole but that may disadvantage some individuals, then there's an interesting discussion. What is the opportunity cost of depriving a billionaire of his tenth billion dollars compared to providing basic shelter and food security to people who for whatever reason don't have it, for example.

Answer me this, if something like the Freedom Dividend is initiated and every citizen in the US gets $1000 a month, who's paying for it. Not at the talking point level. Follow the money trail all the way to its conclusion and tell me, everyone gets 1000 a month, where does that come from?

Tax. What's your point? The utility of a million dollars to someone like Bezos is basically zero, he won't even notice that it's gone. The utility of that million to the thousand low income people receiving UBI that month is potentially huge. It's not that Bezos won't be having his "hard earned" money taken from him unfairly, it's that it's about the same scale of unfairness of you being forced to share a handful of your 5kg bag of gummi bears with your little brother. You won't notice the difference and and it makes a massive difference to the recipient. And in the case of UBI, there's a whole bunch of potential flow on factors that mean that such a system is potentially a good investment in societal wellbeing.

Now, for some people overall happiness, wellbeing and productivity of a society is not a goal that they wish to see over individual "fairness", and that's a valid choice. But it's not some objective truism, it's a choice you make about how your society treats individual versus group welfare.

If these people want to stay with entry level jobs their whole career, why is it my duty to support that? Why should I pay extra taxes for them to be happy settling and not looking to expand on their careers?

I'm not sure how many people want to stay at entry level. For some people that's legitimately their skill ceiling, regardless of education, and that's fine. But mostly what I see in my workplace is that there's plenty of competent people who could perform above their pay grade, but those roles are already filled. If you're a factory worker, there's only so much need for team leaders, operators, shift managers, etc.

I mean, if everyone was suddenly incredibly intelligent and highly educated, and even if you actually automate as much stuff as possible, you still have some need for basic menial tasks that needs to be met. How do you make sure that those jobs keep getting done when everyone is an astrophysicist expecting $100k a year? The job market in anything like it's current state needs a certain amount of people who work basically their whole career at minimum to low income jobs.

There are a so many better, more adult options than standing there with your hand out saying "gimme"

Can we start with losing the emotional language and assuming that the majority of people who would benefit from financial aid are not greedy beggars just looking for a free meal? In any system there are going to be people trying to game it for their own advantage, but my experience of humans is that the vast majority prefer to be self-sufficient. Having a job is meaningful to people, and most aren't looking to avoid working entirely. But it can be hard sometimes to watch banks and CEOs getting bailed out while you're working your butt off trying to find and hold legitimate work but are told that there's no systems to support you specifically so you get to choose whether you eat or have a roof over your head that week.

People who are wealthy have an incredible resilience to things going wrong in their lives; someone steals your car, you get a rental for a week while you buy a new one. If you're poor; you've lost your transport to work, you lose your job, you can't pay rent and you're out on the street. And from there, it's legitimately hard to build your way back up to "normal" again.

The court system in the US (and most countries) requires that a lawyer be provided for people if necessary because it's understood that this is needed in order to have anything like a fair judicial system. Otherwise poor people who can't afford lawyers simply get bullied out of justice by those who can. There's a similar idea with the economy; insulating the poor from simply being bullied out of participation in the economy through either bad luck or wealthy adversaries can actually have an overall positive effect. It's hard to sell lower-middle class lifestyle items to people who are counting pennies to afford more instant noodles.

 

[baldgye]

Ok, so, first off, this is thread is for economics across the board, not specifically UBI. It just so happened that UBI is what was started on. That includes billionaires, tax havens, corporate taxes, etc. The whole lot.
Now, why are tax havens an issue (Switzerland was listed as a tax haven until just this year BTW), because corporations and extremely wealthy in the US can stash their money into banks in a tax sheltered account in one of these countries, where tax regulations are far more favorable. If the money was kept in accounts in the US, it would have been that much more tax money in the US coffers. Which would provide more for things like education and healthcare, things that would better serve communities than taking money from everyone and giving it back to everyone.
Answer me this, if something like the Freedom Dividend is initiated and every citizen in the US gets $1000 a month, who's paying for it. Not at the talking point level. Follow the money trail all the way to its conclusion and tell me, everyone gets 1000 a month, where does that come from?

...more taxes going into education and health service... wealth redistribution... sounds like communism to me

How and why have you drawn this line that state education and healthcare is ok, but the state enforcing liveable wages isn’t? And how do you address any of these issues with less tax?

At the end of the day, you either take responsibility and use the opportunities that are there, or you choose to be the victim.

This feels less like an economic debate and more like a political and emotional one.

If everyone became college educated, then you'd loose a massive chunk of the work force and manual labour jobs would struggle. You're just raising the bar and the requirements for work rather than actually helping the workforce across the board.

 

[Rallywagon]

That's kind of the basis of a community or society, that there's some sort of interdependence. Otherwise you're just a bunch of individuals, otherwise known as anarchy.

I'm not sure if you've ever lost your job or been through a rough patch in your life, but yeah, sometimes entirely able bodied and minded people need support too. Simply being a functional human does not stop bad stuff happening, unfortunately. The world would be a better place if it did.



You seem automatically against anything that could be described as communism. Certainly, communist regimes in the past have not necessarily worked particularly well overall, but one could say the same about some democratic regimes. Depending on what the goals of your society are, I think that there are some things that can be taken from communist type systems and implemented intelligently.

If one accepts that a society is a group of humans, and that groups of humans can choose to make certain concessions that are to the benefit of the group as a whole but that may disadvantage some individuals, then there's an interesting discussion. What is the opportunity cost of depriving a billionaire of his tenth billion dollars compared to providing basic shelter and food security to people who for whatever reason don't have it, for example.



Tax. What's your point? The utility of a million dollars to someone like Bezos is basically zero, he won't even notice that it's gone. The utility of that million to the thousand low income people receiving UBI that month is potentially huge. It's not that Bezos won't be having his "hard earned" money taken from him unfairly, it's that it's about the same scale of unfairness of you being forced to share a handful of your 5kg bag of gummi bears with your little brother. You won't notice the difference and and it makes a massive difference to the recipient. And in the case of UBI, there's a whole bunch of potential flow on factors that mean that such a system is potentially a good investment in societal wellbeing.

Now, for some people overall happiness, wellbeing and productivity of a society is not a goal that they wish to see over individual "fairness", and that's a valid choice. But it's not some objective truism, it's a choice you make about how your society treats individual versus group welfare.



I'm not sure how many people want to stay at entry level. For some people that's legitimately their skill ceiling, regardless of education, and that's fine. But mostly what I see in my workplace is that there's plenty of competent people who could perform above their pay grade, but those roles are already filled. If you're a factory worker, there's only so much need for team leaders, operators, shift managers, etc.

I mean, if everyone was suddenly incredibly intelligent and highly educated, and even if you actually automate as much stuff as possible, you still have some need for basic menial tasks that needs to be met. How do you make sure that those jobs keep getting done when everyone is an astrophysicist expecting $100k a year? The job market in anything like it's current state needs a certain amount of people who work basically their whole career at minimum to low income jobs.



Can we start with losing the emotional language and assuming that the majority of people who would benefit from financial aid are not greedy beggars just looking for a free meal? In any system there are going to be people trying to game it for their own advantage, but my experience of humans is that the vast majority prefer to be self-sufficient. Having a job is meaningful to people, and most aren't looking to avoid working entirely. But it can be hard sometimes to watch banks and CEOs getting bailed out while you're working your butt off trying to find and hold legitimate work but are told that there's no systems to support you specifically so you get to choose whether you eat or have a roof over your head that week.

People who are wealthy have an incredible resilience to things going wrong in their lives; someone steals your car, you get a rental for a week while you buy a new one. If you're poor; you've lost your transport to work, you lose your job, you can't pay rent and you're out on the street. And from there, it's legitimately hard to build your way back up to "normal" again.

The court system in the US (and most countries) requires that a lawyer be provided for people if necessary because it's understood that this is needed in order to have anything like a fair judicial system. Otherwise poor people who can't afford lawyers simply get bullied out of justice by those who can. There's a similar idea with the economy; insulating the poor from simply being bullied out of participation in the economy through either bad luck or wealthy adversaries can actually have an overall positive effect. It's hard to sell lower-middle class lifestyle items to people who are counting pennies to afford more instant noodles.

...more taxes going into education and health service... wealth redistribution... sounds like communism to me

How and why have you drawn this line that state education and healthcare is ok, but the state enforcing liveable wages isn’t? And how do you address any of these issues with less tax?



This feels less like an economic debate and more like a political and emotional one.

If everyone became college educated, then you'd loose a massive chunk of the work force and manual labour jobs would struggle. You're just raising the bar and the requirements for work rather than actually helping the workforce across the board.

You guys are arguing points I never made. In fact, you are arguing points I'm mostly in agreement with. Enough so that I wonder if you're not arguing for the sake of the argument. As such, I was arguing solely against UBI. My view is that there are better options than UBI and that, regardless of its intent, it is absolutely a communist scheme by its literal definition.
Sand for the record. No, I dont see using tax money to fund schools and healthcare the same as UBI. The former are both examples of things that help a society and an individual better itself. UBI just takes money from a bunch of people, and gives it to a different group of people. Its giving people a fish, but not teaching them how to fish for themselves. I dont think it's as good for a successful society as you all do. At best, it's a bandaid for a different issue that needs solving. And that doesnt make me some sort of "righty" (ffs, what a stupid attempt at an insult, lord forbid someone think outside of prediscribed boxes) any more than someone opposing Trump is a leftist.

 

[baldgye]

My view is that there are better options than UBI and that, regardless of its intent, it is absolutely a communist scheme by its literal definition.

I mean it isn't.

Communism (from Latin communis, "common, universal") is a philosophical, social, political, and economic ideology and movement whose ultimate goal is the establishment of a communist society, which is a socioeconomic order structured upon the ideas of common ownership of the means of production and the absence of social classes, money, and the state.

UBI doesn't take possession of things or give common onwership of anything either (at least anymore than general taxation and social improvement schemes do). So my opening reply to you is based mostly on how you've defined communism. And, given that this is an thread on economics, why would this be a bad 'communist' policy?

And yes, I'm arguing for the sake of argument, or more so, discussing it for the sake of discussion because this is a forum (thats the point) and because I find economics a really interesting subject. I stated in an early reply to one of your posts you missed that I'm not really that invested in UBI as a general concept due to a lack of empirical knowledge (or at least I've not read up on much if there is any), but I do find it interesting. my quote is below;

I’m not really for or against UBI, I don’t really know the economics of it and how it would play out. But you seem to be advocating for more of the system to rely on a ‘capitalism’ solving solutions it’s already failing to address...

I'm also still not sure I understand the scheme of reducing taxes and how that would help anyone in poverty. One would imagine that Trumps recent tax breaks on the wealthy would have had an immediate effect on the living standards of the poor in the US, but that seems to not be the case? In fact, globally the wealthy are only getting more wealthy and are owning more and more of the worlds wealthy. CEO's are earning 300x(?) the average income of their employees. So it seems like the current system, or systems with lower taxation, isn't working.

Its giving people a fish, but not teaching them how to fish for themselves. I dont think it's as good for a successful society as you all do. At best, it's a bandaid for a different issue that needs solving. And that doesnt make me some sort of "righty" (ffs, what a stupid attempt at an insult, lord forbid someone think outside of prediscribed boxes) any more than someone opposing Trump is a leftist.

I'm not sure if this is aimed at myself, but I didn't call you anything... and while I can agree in principle with you I don't think the analogy is correct, or fair. What if that person is already fishing and can't move to more plentiful waters? Wouldn't a way to help that person eat to be to share one of you fish (of which you catch hundreds or thousands of) while you work to address the fish supply issue? The distribution of wealth is a massively complex issue that, to address fully and properly could take generations. So, why not in the mean time provide a solution to those living in poverty or in poor means now?

 

[Joey D]

Trickle down economics has little succes. That is also my problem with libertarianism.

I don't believe that's strictly a libertarian ideal. I don't believe trickle-down economics work in the way that if you let business owners have more money than it's somehow going to allow employees to have more money. However, I do believe it works in reverse. If you tax business owners more or make them shell out more money, they're going to pass it down the line to the consumer.

===

With regard to something like a UBI, I don't agree with it. I believe a rough estimate of US citizens over the age of 18 is 210 million, which means in payments alone that would result in $210 billion a month if everyone got $1,000. Multiply that by 12 and you end up with $2.5 trillion a year. Add in things like actually running the program, mailings, etc. and you're probably going to add another chunk of money on that as well. That's a huge amount and even if there were more specific criteria, you're still probably looking at over $1 trillion a year. The government already spends way too much money as it is, adding in something else that rivals the already massive military budget and it'll cause issues.

Also, if everyone suddenly ended up with $12,000 extra per year, it would ultimately contribute to inflation. More money equals more buying power, which leads to an increased demand for goods. Employing the law of supply and demand, prices would go up.

This is all assuming, of course, that the government wouldn't botch up a UBI. Pretty much every government program is run horribly with a ton of overhead and way too much fat. I have no doubt that a UBI program would be run in a similarly awful fashion. I also think there would be rampant abuse of the program. Pretty much all social programs in the US have abuse and it's hard to stop it. I know more than one person who gets "food stamps" and ends up selling them for cash so they can buy useless stuff. It happened frequently in college with students applying and getting food stamps, who would then turn around and sell them so they could spend it on things college kids like...such as hitting up the bar. Nevermind these students had meal programs through the university where they could eat in the dining hall.

Honestly, I'd rather taxes be cut so people who are getting a paycheck can keep more of the money they're working for. Something like one-third of my paycheck goes to federal, state, and city taxes. If taxes were lower and only a quarter or an eighth was taken out, it would be a significant change in the way I can live. Lower taxes and more money in a paycheck would also incentivize people to work because they're taking home more of what they're due. Of course, this could also lead to inflation as well, but I believe it would be less of an issue then if everyone suddenly ended up with a monthly income.

As for making a livable wage, I totally agree it's easier for some than others. However, it's not impossible to move up and make more money, you just need to put forth the effort and for some that effort will be far greater. Nine years ago I was working for $15 an hour in a job with wildly unpredictable hours. Some weeks I'd get 8-16 hours while others I'd get 50 hours. I never knew what one week would give me and I was pretty light on funds. I was ultimately laid off and when I went to collect unemployment, I was first granted it, then denied it after it paid out for a couple of months simply because I was going to school to learn a new skill. When I attempted to fight it, I ended up with a state appointment lawyer and judge that point-blank made it clear that I didn't need the unemployment because I was white (welcome to Detroit, the world's most racist city...no matter what the race). I ended up having to pay back, with interest mind you, the money that was paid to me. I didn't have a job, no income, and now I owed the state several thousand dollars. I managed, but only just.

Flash forward to today and I've worked my way up from making a little less than $50k a year to making more than double that in about eight years. It wasn't easy by any means and I applied for hundreds of jobs and went on more interviews than I remember. I ended up moving across Michigan for one job, then across the country for another. Was it ideal to leave behind my friends and family? No, but if I wanted a better life I needed too.

My point is, it can be done, however, it's not always under ideal circumstances nor easy. It takes heartache and a ton of effort. While I agree that not everyone's story would follow what happened to me, you could pull yourself out of a dead-end job as a McDonald's cashier making $8 an hour. I'm not saying you'll end up a CEO making millions, but by putting forth the effort, you could end up a manager of a McDonald's making a liveable wage.

 

[baldgye]

Honestly, I'd rather taxes be cut so people who are getting a paycheck can keep more of the money they're working for.

How does cutting taxes help people struggling on welfare? Cutting taxes only helps those already able to live within their own means. US Taxes are already pretty low (compared to the rest of the developed world)... you'd want to make them even lower? That'd just take more support from welfare programs and make poorer people, poorer.

As for making a livable wage, I totally agree it's easier for some than others. However, it's not impossible to move up and make more money, you just need to put forth the effort and for some that effort will be far greater.

My point is, it can be done, however, it's not always under ideal circumstances nor easy. It takes heartache and a ton of effort. While I agree that not everyone's story would follow what happened to me, you could pull yourself out of a dead-end job as a McDonald's cashier making $8 an hour. I'm not saying you'll end up a CEO making millions, but by putting forth the effort, you could end up a manager of a McDonald's making a liveable wage.

So people are only poor, because they're lazy? How is 'just work harder' a valid economic policy/concept?

 

[Joey D]

How does cutting taxes help people struggling on welfare? Cutting taxes only helps those already able to live within their own means. US Taxes are already pretty low (compared to the rest of the developed world)... you'd want to make them even lower? That'd just take more support from welfare programs and make poorer people, poorer.

I mean it doesn't, but I think you need to address why those people are struggling? I don't know the data. Honestly, if instead of just handouts in terms of welfare, I'd rather the government create jobs so people can work for the money. Something as simple as fixing infrastructure would be a good place to start. Many of our highways, water, sewer, and electrical systems are woefully out of date. It seems like instead of just giving out welfare, the government could hire these people to work on these projects. It's not ideal in my opinion, but having people working, fixing things that are broken, and developing skills would be more beneficial than just giving someone money. I mean it worked to help get the US out of the Great Depression, so I'm not sure why it wouldn't work now.

And yes, I want to make taxes lower. This could simply be done by reducing military spending by something like 75% because it's simply not needed to have that much expense in defense.

So people are only poor, because they're lazy? How is 'just work harder' a valid economic policy/concept?

I think you took it the wrong way. It's not that people are poor because they're lazy (although there are some people who are poor because they're lazy), but it's more of a lack of a drive to better themselves. Yes, I understand there are barriers that exist for some and not others, but as we all know, life isn't fair. I mean I have a buddy who grew up in poverty with a horrible home situation. He worked his ass off and eventually got a job installing tires at a national tire chain. It wasn't a pleasant job and he made peanuts. However, he continued busting his ass and is now a manager of his own store making a very livable wage with good benefits. It's anecdotal, but it's an example that if you want to better yourself, you'll overcome whatever barriers are in your way even if it takes some time.

 

[baldgye]

Honestly, if instead of just handouts in terms of welfare, I'd rather the government create jobs so people can work for the money. Something as simple as fixing infrastructure would be a good place to start. Many of our highways, water, sewer, and electrical systems are woefully out of date. It seems like instead of just giving out welfare, the government could hire these people to work on these projects. It's not ideal in my opinion, but having people working, fixing things that are broken, and developing skills would be more beneficial than just giving someone money. I mean it worked to help get the US out of the Great Depression, so I'm not sure why it wouldn't work now.

Not everyone on welfare is able to work though, so do those people just starve?
Also I'm not sure how it would work in the US, but in the UK to work on any building site, you need the correct qualifications to operate the tools and machinery needed and certification... which goes back to just telling these people they need to go back to school and re-train... building rules and regulations in 2020 aren't the same as they where in 1930's.

I think you took it the wrong way. It's not that people are poor because they're lazy (although there are some people who are poor because they're lazy), but it's more of a lack of a drive to better themselves. Yes, I understand there are barriers that exist for some and not others, but as we all know, life isn't fair. I mean I have a buddy who grew up in poverty with a horrible home situation. He worked his ass off and eventually got a job installing tires at a national tire chain. It wasn't a pleasant job and he made peanuts. However, he continued busting his ass and is now a manager of his own store making a very livable wage with good benefits. It's anecdotal, but it's an example that if you want to better yourself, you'll overcome whatever barriers are in your way even if it takes some time.

That's just a second anecdote in a thread about economics.

Yes, I understand there are barriers that exist for some and not others, but as we all know, life isn't fair.

With this line, are you suggesting that (economically), the best way to improve growth and prosperity is basically make it so you either desperately try to better yourself at the cost of everything else, or you don't survive? All that sounds like it would do is create an underclass of people that are simply more disconnected from those earning well. Which sounds like a bad concept for an economic plan...



Edit: to elaborate on the UBI, I'm not certain of what version of it means everyone gets 1k a month, that seems rather silly. Though rather, how about a system that makes it so everyone working earning under a threshold, gets a boost so that they can afford to live/eat and work? It'd be difficult to put a number on it because we're from all over the world.

 

[Danoff]

Trickle down economics has little succes. That is also my problem with libertarianism.

"Trickle down" is basically tautological in economics. I've heard you say this type of thing before, and pointed out your error before, but you keep repeating it. I get it, you reject the idea that rich people participate in the market. You're wrong. End of story.

@Joey D it definitely works both ways that corporate taxes getting lowered and corporate taxes getting raised get passed to the consumer. Competition ensures that employers can't just pocket the difference, at least not for long. Raise taxes on a business that is in strict competition and you get raised prices. Lower taxes and that same competition will force lower prices.

edit:
My own view is that extreme wealth should either be taxed or invested into new business or assets that benefit economic growth. Extreme wealthy people buying yachts, expensive wines, cars and other expensive items do not benefit enough people to "trickle down".

That's just simply a falsehood. Buying cars, wine, yachts, etc. employs people.

How does cutting taxes help people struggling on welfare?

It doesn't help them directly. They already pay no taxes. It helps them by making it easier to employ them. It also makes it easier to donate charitably to them.

Cutting taxes only helps those already able to live within their own means.

That's too simplistic a view of economics. Cutting taxes makes it easier to spend, hire, and produce.

US Taxes are already pretty low (compared to the rest of the developed world)... you'd want to make them even lower? That'd just take more support from welfare programs and make poorer people, poorer.

The goal for taxes should be $0. That would be optimal. It's an unachievable goal, but it should be the goal none-the-less.

So people are only poor, because they're lazy? How is 'just work harder' a valid economic policy/concept?

Certainly not.

People are poor for tons of reasons (and for now, I'm just going to talk about people who are here legally and are not fugitives). And for those that are capable of getting out of poverty, they wouldn't all do it in the same way. Some poor people are lazy (I know a few). But lots and lots of poor people are just misguided about how to spend their time. Some of them have terrible business ideas that they stake their entire lives on (and some of this is necessary for a thriving economy). Some of them have unrealistic expectations about the prospects of advancement in their current career, and should instead find a way out. Some of them work very hard, but have no skills, and do not attempt to develop their skills. Some of them waste their money, expecting that hard times will never come, and then are ruined by hard times.

And then there is another group of people who are poor (some of them desperately so, even in the US) and they're poor because something is fundamentally wrong with them. Usually that's not a physical disability - we have programs for lots of physical disabilities to help people. Usually it's a mental disability of some kind. Sometimes it's an untreated disease or undiagnosed disease. Some of those people, either intentionally or unintentionally, harm people and end up in prison. But for the mentally disabled who do not harm people (and I think drug abuse can fall in here), some of them end up dumpster diving on the street and screaming to themselves. There are programs for those people too, and they're not together enough to use them. That's because the government is doing a bad job of reaching them. To be clear, there is a non-criminal group that should also be institutionalized for the same reason that criminals are institutionalized. Because they are incapable of functioning in society in a manner consistent with rights.

So let me try to break this down in a bulleted list (and I'm 100% confident that there are groups not represented here). Also these are not exclusive, you can pick multiple for the same person:

Reasons for being poor in the US
- Lazy
- Bad with money
- Lacking skills
- Unwilling to change jobs
- Mental problems
- Poor healthcare

Several of these issues are not curable with money. The population of people who are poor because they could just get on their feet if someone would hand them $20,000 is not large. Mostly the problem is much deeper, and possibly is unsolvable. "Lazy" is one which is very difficult to cure. "Bad with money" is also quite difficult to cure. I've tried, it's difficult to convince people to change their ways. "Lacking skills" is pretty straightforward to help. I contribute annually to a charity which helps people who are lacking in skills. "Unwilling to change jobs" is a tough one. I guess some kind of educational campaign saying "there's more beyond the reef" might be helpful. Poor healthcare is its own debate.

Mental problems... that's an area where state assistance or even permanent control might be required. Insane asylums get a bad rap, rightfully so, but some implementation of that may be a required function in society. My wife has a fun notion that prison should be voluntarily achievable. You shouldn't have to commit a crime to check yourself in to prison, they shouldn't turn people away who want to be locked up. You should be allowed to sign yourself in for a period of time. If you think about it, it's almost inescapably true.

"I don't think I should be free, and I don't want to have to commit a crime to get in"

uh...

"Welcome"

 

[baldgye]

People are poor for tons of reasons

I'm aware of that, which is why I posed the question to Joey.

As for the rest of your post, I again disagree fundamentally with nearly everything you've said. Especially the concept of taxes should be '$0'. But I can't imagine there would be much value in going down this road as this seems far more politically motivated stance than one based on economics.

 

[Danoff]

As for the rest of your post, I again disagree fundamentally with nearly everything you've said. Especially the concept of taxes should be '$0'. But I can't imagine there would be much value in going down this road as this seems far more politically motivated stance than one based on economics.

Ok I'll bite. What should be the goal for the best tax rate and why?

 

[baldgye]

Ok I'll bite. What should be the goal for the best tax rate and why?

One that supports the countries economy the best?
For example, making sure the population is healthy, educated and safe seem like reasonable things that capitalist systems don't support or provide for everyone... so you'd need a government to make sure those are provided for the population... which would mean taxes...

If you had no taxes, how would you pay for a government? Would corporations rule nations/states?

 

[Joey D]

Not everyone on welfare is able to work though, so do those people just starve?
Also I'm not sure how it would work in the US, but in the UK to work on any building site, you need the correct qualifications to operate the tools and machinery needed and certification... which goes back to just telling these people they need to go back to school and re-train... building rules and regulations in 2020 aren't the same as they where in 1930's.

Virtually anyone can operate a shovel. And I worked road construction for two summers with no formal training. Basically you dig a hole, although since I have a degree in archaeology, I suppose you could argue I do have training. Still, when it comes to updating infrastructure, there's more to it then just manual labor. People in poverty have all sorts of skills. I'm sure there are some that can do things like accounting, planing, or ever ordering supplies.

With this line, are you suggesting that (economically), the best way to improve growth and prosperity is basically make it so you either desperately try to better yourself at the cost of everything else, or you don't survive? All that sounds like it would do is create an underclass of people that are simply more disconnected from those earning well. Which sounds like a bad concept for an economic plan

This comes back to one of my points, life isn't fair. Some people are going to have to try at the cost of everything if they want to make it. Others won't.

There are systems in place to move forward, but it takes effort. If one chooses to ignore those systems and simply sit back and go "woe is me" then, and this is going to sound really crass, I don't really care. Nearly everyone is capable of doing something for money and nearly every one of those people are capable of bettering themselves in some way. I think many people feel a job is beneath them in some way, like sure it's not glamours but something like a janitor is a profession. Sometimes you just need to accept the circumstances suck and you're going to be in a bad place.

As for the best economic system, it is one that benefits most people and most people aren't in poverty (at least in the US). That means letting people who work and get a paycheck to keep more money that they work for.

 

[baldgye]

Virtually anyone can operate a shovel. And I worked road construction for two summers with no formal training. Basically you dig a hole, although since I have a degree in archaeology, I suppose you could argue I do have training. Still, when it comes to updating infrastructure, there's more to it then just manual labor. People in poverty have all sorts of skills. I'm sure there are some that can do things like accounting, planing, or ever ordering supplies.



This comes back to one of my points, life isn't fair. Some people are going to have to try at the cost of everything if they want to make it. Others won't.

There are systems in place to move forward, but it takes effort. If one chooses to ignore those systems and simply sit back and go "woe is me" then, and this is going to sound really crass, I don't really care. Nearly everyone is capable of doing something for money and nearly every one of those people are capable of bettering themselves in some way. I think many people feel a job is beneath them in some way, like sure it's not glamours but something like a janitor is a profession. Sometimes you just need to accept the circumstances suck and you're going to be in a bad place.

As for the best economic system, it is one that benefits most people and most people aren't in poverty (at least in the US). That means letting people who work and get a paycheck to keep more money that they work for.

Would you say that the US has the best economic model?

Which I guess, is the most capitalist nation that operates at the moment, compared to similar models run in Europe?

 

[Joey D]

Would you say that the US has the best economic model?

Which I guess, is the most capitalist nation that operates at the moment, compared to similar models run in Europe?

No, the US doesn't, it needs some serious work. Many of the downfalls are directly related to government interference and regulations holding things back.

And I believe the most capitalist countries are Hong Kong and Singapore.

 

[baldgye]

No, the US doesn't, it needs some serious work. Many of the downfalls are directly related to government interference and regulations holding things back.

So you think the best way to improve the economy would be less government regulation? How does the government hold the US economy back?
In relation to Arms, the fact the US government spends so much on Arms (contributes) to the fact that US weapons companies are some of the biggest in the world. Wouldn't a cut in taxes and military spending reduce this sector and have a pretty sizeable impact in the economy?

It's not overly surprising to hear an American feel this way, this seems to be an innately American stance that the government has too much control and is bad. Yet US companies get far more restrictions in Europe with the goal of helping those economies and promote fair economic practices. How do you feel about this interaction between markets?
Do you feel, for example that the UK should lower its food standards in order to be able to take on US food Or should US standards match the UK's/EU's?

And I believe the most capitalist countries are Hong Kong and Singapore.

Fair enough I'll take your word for it

 

[Danoff]

One that supports the countries economy the best?
For example, making sure the population is healthy, educated and safe seem like reasonable things that capitalist systems don't support or provide for everyone... so you'd need a government to make sure those are provided for the population... which would mean taxes...

If you had no taxes, how would you pay for a government? Would corporations rule nations/states?

So wouldn't the optimal rate be zero? Meaning, the population is healthy, educated, and safe without taxes? I mean, I specifically said that I did not think it was achievable, but that it should be the goal anyway.

Other sources of government revenue include usage fees, endowment, charity, and monetary policy (inflation). I've mentioned it here before that the US Patent and Trademark Office is run entirely on fees, even kicks back a little into the general fund to offset taxes.

Capitalism is not a system of government, it's a description of economic behavior under certain conditions.

Corporations (or any citizens) cannot be allowed the use of force over others, or you end up with a dictatorship.

 

[Joey D]

So you think the best way to improve the economy would be less government regulation? How does the government hold the US economy back?

Sorry for the late reply, but I wanted to be able to give your question a proper answer.

One of the biggest regulations that's the easiest to explain without getting into a massive rabbit hole of things is how the FDA regulates drugs. Essentially it takes an obscene amount of time to bring a drug from the experimental phase to actually being prescribed and sold. This grossly inflates the cost of a drug, which means fewer people can actually afford it, and it also stifles drug companies from innovating new drugs. Pharmaceuticals is a huge business in the US and without the need to innovate, you're not seeing growth in that sector like you would if the regulations were scaled back.

Another is autonomous technology in cars. It's illegal for anything over Level 3 autonomy to exist in the US (so pretty much what Tesla offers now). This is a sector that is poised to explode in the next 10-15 years, but because of regulations, there's no real need to keep pushing the technology forward. Think about if suddenly fully autonomous cars could exist. There would be jobs building these cars, their components, and all the infrastructure to support them.

Finally, agencies like the Environmental Protection Agency do hold back the economy. It's not for a bad reason because I'd rather not live in a toxic wasteland, but it still holds the economy back.

There are countless more as well. Without droning on, here's a good summary of some regulations that not only hurt the economy but also the poor. The sugar one is particularly interesting because it's part of a larger agricultural regulation that more or less price fixes the market. This makes raw crops more expensive than they'd otherwise be if the market was just free. You can see some more bad regulations here, including things like rent control which hurts just about everyone.

In relation to Arms, the fact the US government spends so much on Arms (contributes) to the fact that US weapons companies are some of the biggest in the world. Wouldn't a cut in taxes and military spending reduce this sector and have a pretty sizeable impact in the economy?

Yes, the US spends a ton on defense and reducing the budget would impact these companies. However, many of these companies make things other than just defense items. Companies like Boeing make commercial planes, most firearm companies make civilian guns and ammo, and companies that build missiles also build rockets for space travel.

It's not overly surprising to hear an American feel this way, this seems to be an innately American stance that the government has too much control and is bad. Yet US companies get far more restrictions in Europe with the goal of helping those economies and promote fair economic practices. How do you feel about this interaction between markets?
Do you feel, for example that the UK should lower its food standards in order to be able to take on US food Or should US standards match the UK's/EU's?

I think markets should be free, which is why I have such a problem with Trump's tariffs. That helps no one in a global economy. If a British company wants to export its products and sell them in the US, it should be able to do so.

As for what the UK should do about something like its food standard, I think that's probably up to the UK and its citizens. Plus I don't know enough about European regulations to make an intelligent comment on it.

 

[mustafur]

So what happens when drugs that are not safe get passed through, less regulations seems like a simplistic way to look at it.

 

[baldgye]

I appreciate it @Joey D

Essentially it takes an obscene amount of time to bring a drug from the experimental phase to actually being prescribed and sold. This grossly inflates the cost of a drug, which means fewer people can actually afford it, and it also stifles drug companies from innovating new drugs. Pharmaceuticals is a huge business in the US and without the need to innovate, you're not seeing growth in that sector like you would if the regulations were scaled back.

If you had a public health system, that would also bring down the cost of medication and medical expenses. The US pays far more for both of these than European nations do because it’s based on free market concepts, rather than providing a service.

Do agree that there are market failures? How would a reduction in general regulation help prevent these from occurring?

Looking at those links (I’ve never heard of before); Fee.org isn't that great, because it seems present an agenda, for example, it's first issue is with renewables. Yet it acknowledges that mechanisms within the economy, benefit from it, then lists impacts of basically ageing market forces. So I'm not really fully on-board with it's comments and conclusions
aier.org also seems to have somewhat of a political agenda. It seems right leaning, at least the article you linked. Credit cards and people taking on debt they can't realistically pay back (due to poor credit), seems to me to be a mechanism of market failure rather than a benefit. I think it's better for those with a credit rating so low they cannot borrow, to instead live within their means, rather than taking on debt. I'm not sure that is an economic benefit. The rest seem to be net negatives to the US. Increase in plastic waste, having teenagers vaping (despite serious health concerns), attacking minimum wage.
I would be worried about reducing regulations on drugs and the sale of them to the market. The cost of drugs in the US is obscene, but it seems to be a function of private health care, rather than longer RnD time.

These two sites seem to push for more market freedom by reducing the controls on companies. Yet in doing so they are pushing for companies to provide potentially dangerous and environmentally harmful substances into the economy. While these would net companies short-term gains, long term impacts would hurt the economy.
Again, these feel more like a political stance, rather than an economic stance. But I don't know if the two are possible to 'unlink'

---

My point about US vs UK(EU) food standards is that, to many people in this country, US food standards are shockingly bad. This seems to be, due to how much power the market is able to apply to the government and regulations. There are many debates and issues surrounding US and U.K. trade deals post brexit. The US is pushing for the U.K. to adopt private healthcare and abandon the NHS. This is so that American drug and medical companies can sell to the U.K. too (a huge potential market). Something that would come at a huge cost to people who rely on the NHS and to an economy not designed to accommodate a exclusively private health system. Again this comes at the cost to the poor and would damage the UK as medical costs increased and it's population became less healthy.


For myself I agree in a mostly free market, but the government has to exist in order to regulate and maintain it. A free market can not regulate itself (as has been shown), on top of that, advanced free markets do not create fair environments for competition (think of a how much power Coke has over new drinks companies/start-ups, or Intel and it's anti-competition antics).