Capitalism Hits the Fan (Lecture)

[test123]

"you don't understand", something a religious vegan freak would say. Make a point. Oh noes you can't because I'm right. Now go suck a bag of dicks.

[SwampdonkeyPLD]

Why would I bother? You've shown time and time again that you will simply ignore contradictions between your beliefs and reality.

I don't think the purpose of a political debate is to convince the other side you're right.

Although, that seems like a cop out.

[aurik]

This isn't a political debate.

[aurik]

"you don't understand", something a religious vegan freak would say. Make a point. Oh noes you can't because I'm right. Now go suck a bag of dicks.

I can, but you obviously don't understand what money is, and I'm really not into teaching random people on the internet. If you want, you can search for the recent thread where I went into more detail about the true nature of money.

By the way, gold and silver aren't money, they're goods.

[test123]

you can use gold and silver as money, same as you can use sigarettes as money in prison. Money can take many forms, contracts (IOU's), physical coins (gold). But it is the destruction of the value of paper money (IOU's) that facilitates big government. Which in a way is forging the "contract" which is in a form of a IOU note.

When you promise a friend you will help him/her move his furniture the Gov should'nt be allowed to go and "copy" that favor.

[Olo401]

Capitalism is not at fault, corporatism is.

<snip>

Big govt. leads to the latter, not capitalism.

<sniP.>

Uhhh, feel free to correct me.

Okay.. "big govt" doesn't lead to corporatism.

[Kuya]

Man, today's capitalism ideologues are quite the virus.

[SwampdonkeyPLD]

Apparently reading is more difficult today than others. Insert random insult (here).

[Kuya]

Anyway, ignoring swamp and that test guy, what was this thread about?

[Drex]

Anyway, ignoring swamp and that test guy, what was this thread about?

guy trying really hard for 50 minutes not to get a boner for marxism and then caving in the last 5

[aurik]

you can use gold and silver as money, same as you can use sigarettes as money in prison. Money can take many forms, contracts (IOU's), physical coins (gold). But it is the destruction of the value of paper money (IOU's) that facilitates big government. Which in a way is forging the "contract" which is in a form of a IOU note.

When you promise a friend you will help him/her move his furniture the Gov should'nt be allowed to go and "copy" that favor.

Gold and silver are goods, cigarettes are goods. Coined precious metals are...precious metals (and thus, goods).

Money is not a good, it's a represention of as-of-yet-uncompensated effort, backed by the government. It is a way to represent a promise in such a way that if the person who made you that promise in the first place gets run over by a bus, you can get someone else to live up to his promise instead. A convenient fiction to facilitate the otherwise difficult task of trading hard-to-compare goods and services.

When someone mugs you and takes your money, they aren't actually committing robbery in that they are depriving you of a good. We still call it theft, but language is flexible like that--after all, we call copyright infringement "piracy" when in reality it has very little to do with forcefully boarding ships on the high seas. Rather they are depriving you of the right to determine how you wish to be compensated for your past effort. After all, money is a promise, and you can't own promises.

And of course, government is specifically empowered in the Constitution with the ability to tax in order to promote the General Welfare of the state.

(By the way, you are supposed to report barter income as income on your taxes. So providing / paying for services with apples / blowjobs doesn't get you out of paying taxes)

(And I'll mention again that the federal government is not restrained by the constitution to only create monetary instruments of gold and silver)

[Drex]

And of course, government is specifically empowered in the Constitution with the ability to tax in order to promote the General Welfare of the state.

(By the way, you are supposed to report barter income as income on your taxes. So providing / paying for services with apples / blowjobs doesn't get you out of paying taxes)

because it just didn't feel right to have one of these threads without taxes coming up

[shukudai]

I swear I didn't start this thread to see y'all argue (though I find Aurik's thing on money pretty amusing [not disagreeing, I agree, just amusing]), it isn't as simple as in the video?

The amount profits have gone up since the 1970s, while wages have stayed the same, and as I understand it, the owner's deciding to put this money in banks, which in turn end up lending this money back to the poor employee who's wages haven't gone up, but have to pay it back with interest... That's hilarious, I guess. Sort of evil.

When I think about what he mentions about women's movement meaning women want more jobs... cheaper to make stuff in other countries because of less oppressive taxes/laws... computers/modern techniques coming around meaning we need less workers to produce more, and end of WW2 way back when = more men looking for jobs, it sounds like the perfect mix for disaster, everyone wanting money, and no one able to get it... Yet we're still around.

[Ferion]

The amount profits have gone up since the 1970s, while wages have stayed the same, and as I understand it, the owner's deciding to put this money in banks, which in turn end up lending this money back to the poor employee who's wages haven't gone up, but have to pay it back with interest... That's hilarious, I guess. Sort of evil.

Except real wages have gone up in in the past 30-40 years. Not as much as productivity depending on if you use the CPI or GDP deflator to convert nominal wages to real wages, but there definitely has been an increase.

[Acturus]

Except real wages have gone up in in the past 30-40 years. Not as much as productivity depending on if you use the CPI or GDP deflator to convert nominal wages to real wages, but there definitely has been an increase.

But is the foundation of the argument simply that "wages haven't gone up" or more effectively "wages are being outpaced by productivity, and they shouldn't be".

Does the fact that real wages have gone up, regardless of what perspective those wages are measured against invalidate the argument?

[Ferion]

You can't not take into account what perspective the wages are measured by or else it won't be a measurement in real terms, rather it will be the nominal value which is pretty meaningless when looking at purchasing power. Also, the perspective can be used to skew statistics so that you have data that does not actually reflect the true growth of wages compared to productivity. If you look at the graph I posted in the beginning of the thread, if we're talking about real wages vs. productivity, then with the GDP deflator it seems as if productivity barely out paces the real wages on average. So if this measure is the true indicator of inflation, then yes this would completely invalidate the entire argument. However, if you look at real wages when using the CPI index, it is much lower. At first I was kind of concerned by such a large gap between CPI vs. GDP in terms of inflation since they are usually pretty close. But if you think of what real wages vs. productivity actually means you'll realize that in order to compare the two you can not compute real wages using a price deflator for consumption, which is exactly what the CPI is. If you do this then you're going to see a large fall in real wages relative to productivity, which is what you see in the graph.


Edit: Here's the graph again. http://worthwhile.typepad.com/.share...p_rw_81_06.png

Double edit: It would probably help if I wasn't talking about a graph for Canada since pretty sure he was talking about the U.S. in the video haha. Still doesn't change my point though.

[Drex]

fffuuuu had a long response going that got eaten. I'll try again....

I don't know what wage data he's using for that chart he made, but according to the St. Louis Federal Reserve Bank's research branch, real compensation per hour has steadily risen from 1950 until today, where it's almost triple what it used to be. Maybe he's ignoring benefits, like 401ks? Those take a chunk out of your take home pay. He also mentions efficiency lowering wages, but ignores the effect on cost of goods. Food expenditures as a percentage of individual income have declined from 23% to 9.6% since the fifties. When you add in clothing and housing, the percentage has fallen from 80% to 50% of the average consumer's salary according to the U.S. Bureau of Labor Statistics. Real Median Income per Household Member has gone up from $12k to $19k+ since the '70s according to the census bureau, though that may just be because more household members are working.

There are a lot of factors that have led us where we are, and some of them weren't preventable. But anyone who gets it knows that a lot of them were.

I think the real issue is that very few people really understand credit or interest very well. People hear interest rates like 4% on a mortgage and think "oh that's not a lot", and then realize too late that the house costs 50% more than they thought it would because they used someone else's money to buy it. Or they feel obligated to a new phone every year or less, buy a new car as soon as they pay off the previous one, buy a new T.V. that's 2 inches bigger than the old one, etc., and then wonder where all their money went when it's time to buy dinner for the evening. That may just be me acting cynical. Sure, there are plenty of people who are in dire straits through no real fault of their own (got laid off despite working hard, had serious medical expenses and got screwed by their insurance, and so on), but for every 5 of those, there are 100 who bought a house they couldn't afford ("because I deserve it!"), filled it with fancy furniture they bought on credit, and then got the bill a couple months later and realized how in over their heads they were.

I know everyone hates looking at youtube comments, but let's face it folks: that's America right now. A lot of those people are maxing out their credit cards and blaming their bosses for it. People keep spending money they don't have and wondering why they don't have any money, then calling out the government for doing the same. The notion that you can just blame the rich or the government or the creditors for the financial crises we face is impossible to defend. It also doesn't fix the situation. The real solution WOULD have been prevention via education, but the info has been readily available since the internet went public and no one bothers.

It's so much more fun to learn by experience for a lot of them, I guess. And that's why these crises keep emerging over the decades.

Anyway, his idea at the end about the employees running the business was good for a laugh. I know it looks sexier now that the current economy's flaws are so prominent, and with the ebul CEO's cutting themselves checks, but come on now. You can't honestly tell me that the average person, who doesn't even understand how credit and debt work, should have a significant stake in major businesses or their decisions. Imagine your typical American Idol viewer running Google. Please, no.

You really can't "dumb down" the financial crisis and explain it effectively. It's too convoluted. Too many fuck-ups involved. The fact that the guy who made this video is charging money for the full version just makes it more cringe-inducing. C'mon man.

[Ferion]

I don't know what wage data he's using for that chart he made, but according to the St. Louis Federal Reserve Bank's research branch, real compensation per hour has steadily risen from 1950 until today, where it's almost triple what it used to be. Maybe he's ignoring benefits, like 401ks? Those take a chunk out of your take home pay. He also mentions efficiency lowering wages, but ignores the effect on cost of goods sold. Food expenditures as a percentage of individual income have declined from 23% to 9.6% since the fifties. When you add in clothing and housing, the percentage has fallen from 80% to 50% of the average consumer's salary according to the U.S. Bureau of Labor Statistics. Real Median Income per Household Member has gone up from $12k to $19k+ since the '70s according to the census bureau, though that may just be because more household members are working.

Exactly, it's so easy to skew statistics to favor a point of view that I really would not be surprised by this at all. Did he say how exactly he discounted inflation to obtain real wages? I only kind of skimmed through the video.

[aurik]

Has that data been treated to break it into top10% / bottom90%? I'd be interested to see that info. I know the chart that archi posts regularly shows that real income for the bottom 90% hasn't really changed in 40 years.

[Drex]

Most up-to-date I can find is '07

http://upload.wikimedia.org/wikipedi...7-2007.svg.png

Looks like, from the 70s, only the bottom 20% flat-lined. Eyeballing, but:
40% was up from 40k to 50k (25%)
60% was up from 55k to 75k (36%)
80% was up from 75k to 115k (35%)
95% was up from 120k to 200k (67%)

That's what the census bureau has to say anyway