Re-distribute the wealth

Discussion in 'Politics' started by Salty, Jul 4, 2013.

  1. Salty

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    Have you heard this story:
    A college professor discussed liberal vs conservative with his class. After the first test, The average grade was a B+. The professor decided to "re-distribute" the grades. Those who got a D- was upgraded to a C- ~ and those who received an A+ were reduced to a B+. He did this for several tests - but what he found was that after a number of weeks the actual average grade dropped from a B+ to a C-.
    The professor explained to his class the same thing happens with finance. The more you take from those who actually produce, the less they will produce ~ thus less to redistribute.

    Have you heard this story ( or variation ) thereof. Do you think this is a good example of redistribution of wealth?
     
  2. FollowTheWay

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    You're a bit late with this question. The wealth has already been redistributed. Over the last 20 years the lower 98% of Americans have seen their net worth remain flat whikle the upper 2% has tripled their wealth.
     
  3. Revmitchell

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    Reaganomics Vs. Obamanomics: Facts And Figures

    In February 2009 I wrote an article for The Wall Street Journal entitled “Reaganomics v Obamanomics,” which argued that the emerging outlines of President Obama’s economic policies were following in close detail exactly the opposite of President Reagan’s economic policies. As a result, I predicted that Obamanomics would have the opposite results of Reaganomics. That prediction seems to be on track.

    When President Reagan entered office in 1981, he faced actually much worse economic problems than President Obama faced in 2009. Three worsening recessions starting in 1969 were about to culminate in the worst of all in 1981-1982, with unemployment soaring into double digits at a peak of 10.8%. At the same time America suffered roaring double-digit inflation, with the CPI registering at 11.3% in 1979 and 13.5% in 1980 (25% in two years). The Washington establishment at the time argued that this inflation was now endemic to the American economy, and could not be stopped, at least not without a calamitous economic collapse.

    All of the above was accompanied by double -igit interest rates, with the prime rate peaking at 21.5% in 1980. The poverty rate started increasing in 1978, eventually climbing by an astounding 33%, from 11.4% to 15.2%. A fall in real median family income that began in 1978 snowballed to a decline of almost 10% by 1982. In addition, from 1968 to 1982, the Dow Jones industrial average lost 70% of its real value, reflecting an overall collapse of stocks.

    President Reagan campaigned on an explicitly articulated, four-point economic program to reverse this slow motion collapse of the American economy:

    1. Cut tax rates to restore incentives for economic growth, which was implemented first with a reduction in the top income tax rate of 70% down to 50%, and then a 25% across-the-board reduction in income tax rates for everyone. The 1986 tax reform then reduced tax rates further, leaving just two rates, 28% and 15%.

    2. Spending reductions, including a $31 billion cut in spending in 1981, close to 5% of the federal budget then, or the equivalent of about $175 billion in spending cuts for the year today. In constant dollars, nondefense discretionary spending declined by 14.4% from 1981 to 1982, and by 16.8% from 1981 to 1983. Moreover, in constant dollars, this nondefense discretionary spending never returned to its 1981 level for the rest of Reagan’s two terms! Even with the Reagan defense buildup, which won the Cold War without firing a shot, total federal spending declined from a high of 23.5% of GDP in 1983 to 21.3% in 1988 and 21.2% in 1989. That’s a real reduction in the size of government relative to the economy of 10%.

    3. Anti-inflation monetary policy restraining money supply growth compared to demand, to maintain a stronger, more stable dollar value.

    4. Deregulation, which saved consumers an estimated $100 billion per year in lower prices. Reagan’s first executive order, in fact, eliminated price controls on oil and natural gas. Production soared, and aided by a strong dollar the price of oil declined by more than 50%.

    These economic policies amounted to the most successful economic experiment in world history. The Reagan recovery started in official records in November 1982, and lasted 92 months without a recession until July 1990, when the tax increases of the 1990 budget deal killed it. This set a new record for the longest peacetime expansion ever, the previous high in peacetime being 58 months.

    http://www.forbes.com/sites/peterferrara/2011/05/05/reaganomics-vs-obamanomics-facts-and-figures/
     
  4. Revmitchell

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    As a result, while the Reagan recovery averaged 7.1% economic growth over the first seven quarters, the Obama recovery has produced less than half that at 2.8%, with the last quarter at a dismal 1.8%. After seven quarters of the Reagan recovery, unemployment had fallen 3.3 percentage points from its peak to 7.5%, with only 18% unemployed long-term for 27 weeks or more. After seven quarters of the Obama recovery, unemployment has fallen only 1.3 percentage points from its peak, with a postwar record 45% long-term unemployed.

    Previously the average recession since World War II lasted 10 months, with the longest at 16 months. Yet today, 40 months after the last recession started, unemployment is still 8.8%, with America suffering the longest period of unemployment that high since the Great Depression. Based on the historic precedents America should be enjoying the second year of a roaring economic recovery by now, especially since, historically, the worse the downturn, the stronger the recovery. Yet while in the Reagan recovery the economy soared past the previous GDP peak after six months, in the Obama recovery that didn’t happen for three years. Last year the Census Bureau reported that the total number of Americans in poverty was the highest in the 51 years that Census has been recording the data.

    http://www.forbes.com/sites/peterferrara/2011/05/05/reaganomics-vs-obamanomics-facts-and-figures/2/
     
  5. Salty

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    The point is that 40-50% of all Americians recieve some kind of welfare - and someone has to pay for it
     
  6. poncho

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    That was before all the jobs were shipped overseas. It's pretty simple. No jobs, no recovery. And it ain't going to get any better because there's a new bond bubble just starting to burst now and it'll make 2008 look like a walk in the park.

    Welcome to the new economic world order.
     
    #6 poncho, Jul 5, 2013
    Last edited by a moderator: Jul 5, 2013
  7. Bro. James

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    "No one can buy or sell without the mark of the beast"

    What is in your wallet? Will it be legal tender when times get tough?

    Even so, come Lord Jesus.

    Bro. James
     
  8. Salty

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    Can we get back on topic - some of the things mentioned are worth talking about - but in a different thread.

    Does it bother you that 50% of Americans are on welfare. (I'm NOT talking about EARNED benefits - which to some extent may be excessive) How long can we keep going with these give-a-way programs -?

    There are situations whereby a govt program does discourage someone from getting a job. So what do we do - in the present - not after the tribulation- not some govt conspiracy, ect - what do we do NOW!
     
  9. poncho

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    We can start looking now for another corporatist candidate to support in 2016.
     
  10. poncho

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  11. FollowTheWay

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    Reagan promised to reduce the size of government and to rduce the debt. The truth is his policies, which were correctly described as "Voodoo Eonomics" byGeorge HW Bush, did exactly the OPPOSITE.

    "The national debt tripled from one to three trillion dollars during the Reagan Years. The President and conservatives in Congress cried for a balanced budget amendment, but neither branch had the discipline to propose or enact a balanced budget. The growth that Americans enjoyed during the 1980s came at a huge price for the generations to follow." See http://www.ushistory.org/us/59b.asp.
     
  12. Salty

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    Two things
    1) what does your post have to do with the OP
    2) Why did you "Quote" the enitre post of Revmitschell?

    I will say this - you bring up an interesting post. I do have a couple of points to make - but will do so only if you start a new thread.

    IF NEED BE - GO TO POST # 1 READ THE OP and then comment.
     
  13. InTheLight

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    I don't think it is a good analogy of wealth distribution.


    1. Did the A students slack off on their studies? Your example doesn't say.

    2. There is no proof that the more you take from producers the less they will produce. If you have proof, let's see it.

    Now, if there were a salary cap, I could believe that people would slack off on production. Or if there was a law that said people would be taxed at 100% once they had earned, say, $1 million per year, then yeah production would be rationed.
     
  14. saturneptune

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    What all do you consider welfare?
     
  15. saturneptune

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    Yes, I think that is a good analogy of wealth redistribution. Overall, the bottom line is that it harms the entire unit, or in our case, the nation. It decreases production, incentive, imagination, thinking skills, and pride. Another way this is done is through the tax laws. For example, while raising the rates on the richest Americans (actually, it goes quite a way down the ladder to 250,000), the government, which produces nothing, is taking earned money away from those who do produce something that others do not have to pay at the same rate. This is one half of the process. Then, on the low end, there is something called earned income credit. This is a receiving something for nothing technique. Those on the lower end of the scale, who basically produce nothing, get tax dollars back that they never paid in through this credit. In reality, they are receiving the money the higher tax rates on the rich lost.

    Why should someone who makes this a better nation through their efforts and work, be required to support a no load who is too lazy to get out of bed and get to work?
     
  16. Salty

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    Any income you did not actually earn.

    On a TV game show, a person may win $10,000. Is that welfare - no - he did something to earn it (maybe not much - but something).

    Our church just gave a pounding to a missionary last week - would that be considered welfare.
    No, he came to our church and presented a ministry.

    A person goes from trash can to trash can looking for bottles to Turn in (@ 5 cents each). Person "B" sees him and gives him a case full of empty bottles. Is that welfare - NO - the individual is "working" and provides a benefit to person "B" by getting rid of something he does not need.

    Welfare -or as I prefer to all it - "give-a-way" programs - is providing something when nothing is done to earn it. A dictionary definition is "
    financial or other assistance to an individual or family "
    Is it right for someone to get food stamps and then buy junk food? Should a single mom be getting food stamps, welfare, WIC,ect and then letting an older child buy a $100 pair of sneakers?
    Churches provide welfare - and they should -
    but when churches do it - there should be strings attached. Stings to provide a hand up - NOT a hand out.
     
  17. FollowTheWay

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    That's because the real rate of unemployment is over 20%. Many of those "on welfarer" as you put it are professionals with college degrees or graduate degrees who have lost their jobs and homes. I don believe that extending unemployment benefits to two years was a mistake because it masked the problem. Without that we'd have shanty towns springing up just like in the 30's. Americans simply don't realize how "living the American drfeam" with high personal debts has destroyed our country now that hard times are here.
     
  18. Salty

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    and that is a key problem in this country.

    And further it is not the responsibility of the govt to take care of people. Let the churches and social agy do it.
     
  19. FollowTheWay

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    I was responding to the following:

    "President Reagan campaigned on an explicitly articulated, four-point economic program to reverse this slow motion collapse of the American economy:

    1. Cut tax rates to restore incentives for economic growth, which was implemented first with a reduction in the top income tax rate of 70% down to 50%, and then a 25% across-the-board reduction in income tax rates for everyone. The 1986 tax reform then reduced tax rates further, leaving just two rates, 28% and 15%.

    2. Spending reductions, including a $31 billion cut in spending in 1981, close to 5% of the federal budget then, or the equivalent of about $175 billion in spending cuts for the year today. In constant dollars, nondefense discretionary spending declined by 14.4% from 1981 to 1982, and by 16.8% from 1981 to 1983. Moreover, in constant dollars, this nondefense discretionary spending never returned to its 1981 level for the rest of Reagan’s two terms! Even with the Reagan defense buildup, which won the Cold War without firing a shot, total federal spending declined from a high of 23.5% of GDP in 1983 to 21.3% in 1988 and 21.2% in 1989. That’s a real reduction in the size of government relative to the economy of 10%.

    3. Anti-inflation monetary policy restraining money supply growth compared to demand, to maintain a stronger, more stable dollar value.

    4. Deregulation, which saved consumers an estimated $100 billion per year in lower prices. Reagan’s first executive order, in fact, eliminated price controls on oil and natural gas. Production soared, and aided by a strong dollar the price of oil declined by more than 50%.

    These economic policies amounted to the most successful economic experiment in world history. The Reagan recovery started in official records in November 1982, and lasted 92 months without a recession until July 1990, when the tax increases of the 1990 budget deal killed it. This set a new record for the longest peacetime expansion ever, the previous high in peacetime being 58 months."

    Reagan did not initiate a recovery. In fact he initiated the beginning of the end.
     
  20. Spear

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    We have 3 kids. We get 350 $ each month from the state, it's called " family policy ". We get another 350 $ for having the baby held by a nanny.

    Not every welfare thing is bad. Novadays, both parents work, and the gov wants us to have children, so it incites us by economical ways. We're in the " granny boom ", and we must support our elders who were many more kids per family than what we are today. The government incites us to replace them, and moreover, to be able to pay for their healthcare, their pensions ....

    What might be seen as a " welfare " thing is more of a strategic thing (and probably one of the rare " really welfare " things that work here).
     

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