# Long slow collapse??



## Tirediron

If the economy goes into a long slow collapse instad of a sudden fall off of a cliff. How many prepper will use up all of their prepps before things get really bad.?? and what if china's currency values up to the point that chinese junk is no longer cheap??


----------



## jsriley5

Been thinking of that myself I"m not real sure that we haven't already started the long slow decline I think there will be a series of steep little falls rather than the big ending I had originally thought would happen. Thats why I"m getting more in shape for growing and preserving my own food so that rather than get into my preps and use them up I can be self sufficient and even add to my supplies in the event that somthing happens that makes it impossible to grow my own for a season or two. Self sufficiency is my goal get to where we are only payng bills and luxuries and high durability items I can't manufacture on my own like solar panels and batteries and wind generation equiptment. ONce you dont HAVE to go to the grocery store there is little else to concern you beyond security and comfort. At that point it won't matter whether it gets better, slowly declines, or drops like a rock we will be covered. And just maybe more healthy for it too!! Can't wait to get started with my own med herbs and tincutes and teas and see how many of the pharmceuticals I can wean myself off of without keeling over.


----------



## techrun

I rotate everything out on a 12 month / 24 month rotation. For example, I have 20-25 tubes of toothpaste, I will buy another 20 or so tubes when the rotation schedule comes up. 

I'll slowly use the previous 20 tubes while the new 20 is put back for 12 months. 

Canned food is on a 24 month rotation. 

I hear what you're saying though. For me, that would be a lot easier to handle than a sudden collapse. 

There are a ton of ways I could mitigate the affects of a slow collapse.


----------



## hiwall

No one knows what is coming down the road. All we can do is prep to the best of our abilities. For what its worth, I think it will be fast instead of slow.


----------



## techrun

hiwall said:


> No one knows what is coming down the road. All we can do is prep to the best of our abilities. For what its worth, I think it will be fast instead of slow.


Words to live by for sure.


----------



## preponomics

Tirediron said:


> If the economy goes into a long slow collapse instad of a sudden fall off of a cliff. How many prepper will use up all of their prepps before things get really bad.?? and what if china's currency values up to the point that chinese junk is no longer cheap??


If china cannot provide cheap junk then someone else will. Its in demand, but if this happens during the turmolt of collapse, then there has to be economic stability before it can, which would take at least a year to be established locally again (just my predictive opinion, as no one can define specific variables amidst chaos). Just depends on how much intervention will be allowed to "save us". If we save ourselves, much faster.  I would think maybe three years before you would see the cheap benefits of goods again at a minimum, even with no intervention. A process of supply and demand will need to proliferate many local markets to price compete a lower price.

Since intervention in the great depression lasted for 12 years, it earned the infamous title "The GREAT depression" that lasted 14 years. I just hope that our next fallout which could be serious, that we dont prop it up for ten years.

If subsidies, corporatism, and trade intervention were to go away we would have a lot of those cheap things provided here almost overnight because we don't have the shipping costs. However technology of some cheap things are superior in other places, but if we had free trade, then our local small business would have the competitive advantage. Then its just a race of innovation from that point with local cost advantages and no punishing restrictions to do business internationally/ or locally.

as for preps - it could be the long haul the way its going - years of socialism, corporatism, and plunder.


----------



## k0xxx

hiwall said:


> No one knows what is coming down the road. All we can do is prep to the best of our abilities. For what its worth, I think it will be fast instead of slow.


Well said. Personally, I feel that it will be like a whirlpool. Slow to start, but gradually increasing in speed until there is a very sharp drop. I get the feeling that we have been going in circles for a while...


----------



## preponomics

jsriley5 said:


> Been thinking of that myself I"m not real sure that we haven't already started the long slow decline I think there will be a series of steep little falls rather than the big ending I had originally thought would happen. Thats why I"m getting more in shape for growing and preserving my own food so that rather than get into my preps and use them up I can be self sufficient and even add to my supplies in the event that somthing happens that makes it impossible to grow my own for a season or two. Self sufficiency is my goal get to where we are only payng bills and luxuries and high durability items I can't manufacture on my own like solar panels and batteries and wind generation equiptment. ONce you dont HAVE to go to the grocery store there is little else to concern you beyond security and comfort. At that point it won't matter whether it gets better, slowly declines, or drops like a rock we will be covered. And just maybe more healthy for it too!! Can't wait to get started with my own med herbs and tincutes and teas and see how many of the pharmceuticals I can wean myself off of without keeling over.


I think your approach is very balanced


----------



## preponomics

k0xxx said:


> Well said. Personally, I feel that it will be like a whirlpool. Slow to start, but gradually increasing in speed until there is a very sharp drop. I get the feeling that we have been going in circles for a while...


I agree - I think our economy is built upon a thousand vertical markets and even-though one can affect another 20 markets upon hitting bottom, the overall market keeps trying to succeed. This would be indicative to your scenario. Waves that lead to a sharp drop as each market deteriorates with propped up and destructive intervention.


----------



## FrankW

I think RT has a great point.

And the long slow collapse has already started.
Basically we are living at the tail end of afossil fuel and technology fueld golden age and no golden age lasts forever.

As oil beocmes more expensive , EVERYTHING becomes more scarce.

So far we been doing a great job of pushing the dark ages a few more decades off.
But the slide is inexorable


----------



## Bobbb

This is the new normal. We're never going to see the 90s again unless there is some miraculous productivity boosting innovation which gets introduced (the internet) and is widely adopted in the economy.

The reasons why this is the new normal are simple to understand. Just like everything seemed normal for Republicans during the last election while the demographic time-bomb was slowly growing in size until it exploded in this election, the trends underlying this new normal have long been visible but people haven't wanted to acknowledge them.

Trend #1: Importing poor and dumb people for low wage jobs rather than eliminating those jobs or assigning machinery to perform that task results in adding more people who require taxpayer subsidy to society. This puts stress on government spending, borrowing and taxing.

Trend #2: Feminism results in the women, and couples, who are best situated to provide all of the environmental advantages which children need to become productive adults being the group which has the fewest children and so population growth comes mainly from importing poor and dumb people and from women, and couples, who are not optimally situated to provide the environmental advantages that tend to produce the most economically productive adults. This results in the nation's aggregate IQ falling. We're becoming poorer and dumber. 

Trend #3: As energy costs rise, more and more of society's innovation is directed towards finding ways of offsetting those increased costs whereas before this was necessary the innovation developed within society would be directed towards enhancing productivity and wealth. Past generations got richer, our generation is treading water or sinking, and future generations will have it worse.

Trend #4: The politically easy route is to give people what they want rather than asking them to sacrifice. This works only so long as someone else is lending the government money. When the money stops then the slow decline will advance its pace significantly.

Trends #1 and #2 are the most significant. We're being cooked in our own mediocrity. Poorer and Dumber is not a way to "Win the Future." The trend that leads to prosperity is to have each successive generation be a bit smarter and a bit richer than the present generation and what we have is each successive generation becoming a bit dumber and a bit poorer and the population ratios favor the wrong dynamics. This is the internal decay which is slowly eating out society and all will look normal until the decay becomes so bad that no policies can keep the edifice upright. 

When the US falls, the ripple effects will be felt all over the world. When Rome fell there wasn't a successor state standing in the wings ready to carry the baton forward to a glorious future.

Life isn't always onward and upward.


----------



## FrankW

Bobb: Post of the week!


----------



## Bobbb

preponomics said:


> If china cannot provide cheap junk then someone else will.


An economy which requires a continual progression towards the lowest common denominator of low wages is akin to playing musical chairs and at some point the music will stop and the economy, which depends on the progression being never ending, will falter and it might crash.

The world has only so many places where we can find people willing to work for a few dollars per day. Once China is tapped out the only remaining place is Africa and the problems in Africa, and with its people, preclude them rising as a replacement for China.

This means that the price of goods is going to increase while our incomes stagnate or fall. A double whammy like this means a lot of misery for people.


----------



## BillS

I don't see a long slow decline. Europe already has socialized medicine and more government spending than we have. We're going to decline economically until a new equilibrium is reached unless something drastic intervenes.

That drastic thing could be a US banking collapse started by a European banking collapse. Or it could be the collapse of the dollar followed by hyperinflation. Expect the economy to continue to slow down. Then expect the collapse to be sudden.


----------



## preponomics

Bobbb said:


> Trend #1: Importing poor and dumb people for low wage jobs rather than eliminating those jobs or assigning machinery to perform that task results in adding more people who require taxpayer subsidy to society. This puts stress on government spending, borrowing and taxing.


Respectfully, by this first trend you insinuate that imported dumb people is causing our economic woes. I disagree, how about "Economic Interventionism", which will also invoke those subsidies, borrowing, and taxation that you mentioned?


----------



## Bobbb

preponomics said:


> Respectfully, by this first trend you insinuate that imported dumb people is causing our economic woes. I disagree, how about "Economic Interventionism", which will also invoke those subsidies, borrowing, and taxation that you mentioned?


It's fine that you disagree. Here, let me try that. I disagree with the statement that water is wet. A statement that you disagree doesn't tell me anything about WHY you disagree. You must have a reason why you disagree, right? Why don't you make your case for why you disagree. This isn't a democracy of ideas where everyone's statement is given equal weight - your statement of disagreement doesn't carry the same weight as my statement of factors. My statement that water is dry is not equal in significance to a statement that water is wet, which is backed up by evidence. I've gone a step further than you, I've put some meat on the bones, and this gives people something to chew on. Why not do the same and tell me why I'm wrong.

As for your counter claim, if you put a coined phrase into quotations, then you should explain exactly what you mean by it rather than leaving it up to people to attach their own interpretations to your coined phrase.

Let me add one further troubling trend. Of the following 3 factors only 2 can be operational at the same time while all 3 being operational leads to instability. Choose 2 from Democratic Voting, Free Markets and Multiculturalism.

In a multicultural society where free markets exist, some groups will outperform other groups and a stratification will result through a fair and non-discriminatory system. This pisses off the losers. The losers try to use the power of their votes to equalize outcomes by enabling government to threaten with force and to expropriate wealth from the winners and redistribute it to the losers. When the loser class is smaller than the winner class their efforts don't succeed all that well or the burden imposed on the winners is manageable. When the loser class becomes larger than the winner class then all hell breaks loose as the power of the loser class grows and so too do their demands. When the demands becomes overwhelming either in terms of scale or in terms of injustice, then revolution occurs and one of the 3 starting conditions is taken out of the pot. Either dictatorship emerges which allows a fair system to continue and strips people of their ability to use government to steal on their behalf. Alternatively, the economy becomes managed and equality is produced by dictate and all of the wealth that free markets produce is sacrificed. Alternatively, the society fractures on racial lines and thus eliminates the tension produced by unequal outcomes produced in a fair system and the ability to use government to settle scores.

As should be obvious to us all, we live in a system characterized by all 3 factors and this is a system which cannot be sustained.


----------



## preponomics

Bobbb said:


> An economy which requires a continual progression towards the lowest common denominator of low wages is akin to playing musical chairs and at some point the music will stop and the economy, which depends on the progression being never ending, will falter and it might crash.
> 
> The world has only so many places where we can find people willing to work for a few dollars per day. Once China is tapped out the only remaining place is Africa and the problems in Africa, and with its people, preclude them rising as a replacement for China.
> 
> This means that the price of goods is going to increase while our incomes stagnate or fall. A double whammy like this means a lot of misery for people.


Repectfully, I differ bobbb - I think economics operates on set of rules, and if left alone it will thrive. I agree with you that "with" intervention it will be a massive game of musical chairs. Keynesian economics is based on this progression you mention, but Austrian economics is not. Thus, I argue for a different economic premise. Keynesian economics is about modifying demand, using a manipulated lawful device to secure peoples money upfront in order to create that demand. Austrian economics is as simple, as natural supply and demand being left alone. Upon societal transitions, the natural movements of supply and demand follow it reactivity but "closely". Trending up, and down, self correcting itself naturally, as people wish to hold, spend or invest their money.

Technology will cause natural bubbles but "left alone" economics rapidly will adjust to it, but as an opposite, our Keynesian system props crap up forever until all businesses suffer stagnation due to interventionism. Keynesian economics punishes the individual and the business owner. There is never a true bottom on what markets are worth, and how much people actually own. Thus Keynesian economics is a perversion of the market place giving us the "new normal".

As for the underpaid, they benefit their own life much more than they hurt ours, as intervention, is the source of the problem routing lawful advantage to corporatists willing to immorally distort the job market in the midst of corporate wellfare. Hurting small business and routing taxpayer money. I am a HUGE supporter of capitalism but corporatism is pure economic calamity and a killer of economies for thousands of years.


----------



## Magus

Tirediron said:


> If the economy goes into a long slow collapse instad of a sudden fall off of a cliff. How many prepper will use up all of their prepps before things get really bad.?? and what if china's currency values up to the point that chinese junk is no longer cheap??


Faster than you think.got silver?got AMMO?


----------



## Bobbb

preponomics said:


> Repectfully, I differ bobbb


You can disagree with me until the cows come home and I won't take your disagreement as a sign of disrespect. Don't worry about my feelings. If you disagree with something I write, attack it and let's see how my argument sustains your attack. I don't want to hold weak arguments so if you can knock them down then you're doing me a favor.



> I think economics operates on set of rules, and if left alone it will thrive.


Ceterus paribus, that is, all things being equal, your position might have some merit, but that mostly works in a theoretical vacuum. We live in a social welfare state and people have the power to vote. You can launch your Austrian economic revolution and if the results don't please the majority of people, then your experiment will be shelved, no matter what the efficiency of outcomes produced compared to a Keynesian approach.



> Austrian economics is as simple, as natural supply and demand being left alone.


And a byproduct of a fair and efficient system is a sorting between winners, also rans, people who do OK, and people who are losers. There are social consequences which arise from these outcomes, hence the welfare state and it's ability to mollify the losers but in so doing it corrupts the pureness of what you advocate.



> As for the underpaid, they benefit their own life much more than they hurt ours


In a completely free market without any welfare state, yes, a person who makes a low income is definitely better off than would the case if they earned an even lower income or none at all. What these people earned would be of no consequence to anyone else. That's not the world we live in. We're not pure and rational economic actors, we're humans and with that comes all the baggage of envy and jealousy which liberals use as the foundation of their political philosophy.


----------



## preponomics

Bobbb said:


> As for your counter claim, if you put a coined phrase into quotations, then you should explain exactly what you mean by it rather than leaving it up to people to attach their own interpretations to your coined phrase.
> .


No problem that is a fair request 

I will write you a case for "economic interventionism" versus your trend factors listed in your OP.


----------



## preponomics

Bobbb said:


> You can disagree with me until the cows come home and I won't take your disagreement as a sign of disrespect. Don't worry about my feelings. If you disagree with something I write, attack it and let's see how my argument sustains your attack. I don't want to hold weak arguments so if you can knock them down then you're doing me a favor.


no problem I will try to be more frank



Bobbb said:


> Ceterus paribus, that is, all things being equal, your position might have some merit, but that mostly works in a theoretical vacuum. We live in a social welfare state and people have the power to vote.


I do live in a vacuum where, i hope one day people live by a set of standards that protect the principles of individual liberty and laissez faire economics.

I agree that we live in a social welfare state



Bobbb said:


> You can launch your Austrian economic revolution and if the results don't please the majority of people, then your experiment will be shelved, no matter what the efficiency of outcomes produced compared to a Keynesian approach.


I also agree that most americans in my country have no clue what Austrian economics is and it will probably be shelved for quite a while since keynesian economics routes so much free money to the despotic.



Bobbb said:


> And a byproduct of a fair and efficient system is a sorting between winners, also rans, people who do OK, and people who are losers. There are social consequences which arise from these outcomes, hence the welfare state and it's ability to mollify the losers but in so doing it corrupts the pureness of what you advocate.


Austrian economics is not fair, not perfect, it is efficient, it protects the individual and not the State, and with it the poor are radically reduced. I also see the social problem of the poor as being addressed by private rescue not public.



Bobbb said:


> In a completely free market without any welfare state, yes, a person who makes a low income is definitely better off than would the case if they earned an even lower income or none at all. What these people earned would be of no consequence to anyone else. That's not the world we live in. We're not pure and rational economic actors, we're humans and with that comes all the baggage of envy and jealousy which liberals use as the foundation of their political philosophy.


I agree its not the world we live in but I believe the world can change through education and with more understanding regarding the principles of individual liberty. A thousand years ago totalitarian despotic oppression was a standard, and today although State sovereign powers have destroyed human life unto uncountable numbers, we can still say that we have evolved to an era of social contracts that are starting to protect basic human rights and define some leanings of individual liberty within developed nations as a norm on some levels. A long way to go but an improvement based on lawful standards. I believe the day will come where upon an early age its possible for a younger generation to bond through prudence, with the principles of individual liberty and principles of individual economic independence.


----------



## Padre

*Slow decline is the worst case scenario*



Tirediron said:


> If the economy goes into a long slow collapse instad of a sudden fall off of a cliff. How many prepper will use up all of their prepps before things get really bad.?? and what if china's currency values up to the point that chinese junk is no longer cheap??


I have always said that a slow decline is a worst case scenario. A sudden collapse involves all the pain of that sudden collapse, which granted can kill you, but a slow decline runs the real risk of a normalcy bias predicated on a bad baseline for normal. Normalcy bias is dangerous, because it can get you killed when the SHTF, but part of that bias is an unwillingness to give up the "good old days," which is actually a good thing because once the BIAS is gone there is just a desire to restore what was lost. In contrast, if your normal is piss poor then you might loose the hope for a better day that is key to survival. We don't want to settle for the gulag because that is the new normal because the alternative is worse....

A drawn out collapse places real stress on your preps, particularly as more and more people begin to see the decline and begin prepping causing prices to rise and perhaps the government to step in to control "hoarding" (or at least monitor it in preparation for confiscation). All you need to do is think about the cost of ammo--while I am sure the wars have increased the cost of ammo as has the price of metals--I believe a big part of that increase is increased demand from people like us, and its going to get worse so long as people (20% a present) are truly concerned about a collapse. Also, speaking of government intervention, there is a real risk of confiscation, not just rationing or bans, as a result of a drawn out collapse.

BTW, our current normal is pretty bad off already, our country has been in a moral and political decline for almost 100 years. I mean we used to trust citizens with automatic weapons and unpasteurized milk....


----------



## Bobbb

preponomics said:


> Austrian economics is not fair, not perfect, it is efficient, it protects the individual and not the State, and with it *the poor are radically reduced.*


I believe that you either fundamentally misunderstand the causes of poverty or you overestimate the effects created by an economic system and how they affect the poor.

Economic systems in themselves don't create wealth, individuals do. The economic systems come into play at higher levels. It is at this foundational level though that the roots of poverty are found. Let me explain by way of example. If I have a clogged pipe in my home's plumbing I can fix that pipe myself or I can hire a plumber. If the solution is simple then I can do the work myself and I don't have to call on any expertise. However, if the work is complex then I am stumped. Now, I can persevere through the work, stop and search on the internet, drive to Home Depot and ask the salesman for his recommendation and so on and waste 10 hours of my time until I find a solution and there is a cost to this approach. Alternatively I can hire a plumber who can achieve the same result in 30 minutes. What we see here is the plumber creating wealth. He applies his expertise and in 30 minutes he achieves what would take me a whole day. If I take that day and go earn money at a job, then from those proceeds I take SOME money and pay the plumber and I have money left over. We are both better off via this trade.

The problem which causes poverty is that poor people have trouble producing wealth - they have few skills that they can sell which can't be replicated by others. One poor person can mow your lawn just as easily as another poor person or just as easily as someone's teenager.

The key to wealth or poverty is human capital - how much wealth can a person create via trading where both parties come out better off after the trade than by neglecting to trade. Poor people have little that they can trade in order to produce wealth. On the flip side, a money manager with a good track record can produce billions of dollars of wealth for himself and for those who trust him to manage their money. If we compare two such people, each managing a portfolio of $1 billion dollars, and one manager delivers an added 1% rate of return, then he's created an additional $10,000,000 of wealth for his clients. In terms of his compensation if the clients are happy to freely give this man $2,000,000 of the $10,000,000 of wealth he's created for them, they're still better off with the remaining $8,000,000 he created than by not paying him anything and forgoing the $10,000,000 he could create.

So, long before we look at economic systems we have to get right down to the very fundamental issue of how each of us create wealth in our daily lives. Some people create wealth by wrapping McDonald's hamburgers into paper wrappers. They create wealth via this work but the wealth they create is not worth that much and so, without any other skills demanded by the marketplace, these people get classed as poor. Your economic revolution is not going to change the process of how wealth is created. And this brings me back full circle to Trend #1 - importing and growing our own poor people is a problem. As a society we should be trying to reduce the number of poor people. We can all agree on that. The debate focuses on how to achieve that goal. Liberals believe that socialism and the forced redistribution of wealth will achieve that goal and they're probably right but the cost of doing that is to make everyone equally poor and to rape people of their liberties. My solution is to reduce the number of poor people in our society and let other nations develop their own solutions. With a reduction in the number of poor people comes a lessened intensity for wealth redistribution and a lessened demand to rape people of their liberties.



> I agree its not the world we live in but I believe the world can change through education and with more understanding regarding the principles of individual liberty.


Education is not the magic bullet here. Sure, via education a person can develop some skills which they can market to create wealth, but we when isolate both education and IQ and compare to income that is earned we find that education adds almost nothing once the effect of IQ is accounted for, the exception being education which imparts marketable skills, just as medicine, engineering, martial arts, and so on but even here it is IQ which is enabling the acquisition of these skills - a poor person who is dumb is not going to be equipped to study engineering no matter how many resources society targets to that goal.

As for people developing a greater respect for principles of individual liberty have you seen the outcome of this last election? People want free stuff, not individual liberty. This is the humanity that we're working with so it's no use pretending that humanity is something that it's not.


----------



## FrankW

Some absolutely fantastic posts from Bobbb as usual!

Sir, your ability to explain these things within a couple of paragraphs is uncanny.
I would need a page or two ( which no one would read)

Also Bobbb is one of the few members of this board to use langugue in a precise manner.
By that, I dont mean avoiding my nemesis ,typos, but that his writing expresses exactly what he means.
No more no less.
No fuzziness in writing, that leaves a lot to subjective interpretation.

Every argument follows both logic and Occams razor too.

One of the gems on this site!!


----------



## ComputerGuy

Agreed Bobbb does a fantastic job on his posts. He does a great job given the fact that in the liberal rules when engaging an enemy is to diminish their ideas and if you cannot win doing that... diminish them to the best of your ability!


----------



## Padre

Bobbb said:


> Trend #1: Importing poor and dumb people for low wage jobs rather than eliminating those jobs or assigning machinery to perform that task results in adding more people who require taxpayer subsidy to society. This puts stress on government spending, borrowing and taxing.


Again, I am not a big fan of throwing around the R word, but I think this is BS. As the son of an immigrant no one, including me, works harder than my mom. She would never take hand outs and she taught me not to... All my spoiled American peers took everything for granted and got all the "stuff" that my mom would NEVER give me. If I wanted SH$T I had to work and pay for it myself. She worked and saved and when we needed a loan we went to the bank of Mom, rather than someone who lends at Usury. As the son of an immigrant I grew up with immigrants and didn't know ANY of them who fit your generalization. Now are there some Mexicans who come to this country and take handouts? Sure, but is that their fault or the fault of the a STUPID government that pushes handouts like a drug dealer offering free samples.

And it is racist to blame immigrants (Hispanics I would suppose) for being on the dole while ignoring the black and white natural born Americans (who in basically equal numbers) are on the dole.



Bobbb said:


> Trend #2: Feminism results in the women, and couples, who are best situated to provide all of the environmental advantages which children need to become productive adults being the group which has the fewest children and so population growth comes mainly from importing poor and dumb people and from women, and couples, who are not optimally situated to provide the environmental advantages that tend to produce the most economically productive adults. This results in the nation's aggregate IQ falling. We're becoming poorer and dumber.


I pretty much agree, but you really gotta question the so called intelligence of people who reject the BIOLOGICAL natural law: "be fruitful and multiply." Many poor immigrants, who BTW also value the stable families that you suggest only come with being rich and natural born, are pretty smart when it comes to reproducing.

*As arrows are in the hand of a mighty man; so are children of the youth. 
Happy is the man that has his quiver full of them: they shall not be ashamed, 
but they shall speak with the enemies in the gate~Ps 127
*​


Bobbb said:


> Trend #3: As energy costs rise, more and more of society's innovation is directed towards finding ways of offsetting those increased costs whereas before this was necessary the innovation developed within society would be directed towards enhancing productivity and wealth. Past generations got richer, our generation is treading water or sinking, and future generations will have it worse.


A lot of this is over regulation, which causes American innovations to be manufactured elsewhere, thus depriving America of the jobs and wealth that comes from many innovations that do originate in this country. However, you are correct that our economy is built on (really $1) cheap gas, and WILL decline in exponentially in relationship to the increased cost of fossil fuels, particularly oil, unless systemic changes are made to our economy or new/different fuel sources are found. Our fuel problems are also related to government interventions as MARKET forces are all about dealing with REALITY!



Bobbb said:


> Trend #4: The politically easy route is to give people what they want rather than asking them to sacrifice. This works only so long as someone else is lending the government money. When the money stops then the slow decline will advance its pace significantly.


Yep, what the masses want, or really, to be honest, have been taught to want, is a really big rock constantly threatening our society, sadly they push society always closer to the hard place of REALITY!



Bobbb said:


> Life isn't always onward and upward.


Nope, but while it might not always be easier it definitely can be more human if we make a choice to be more human.


----------



## Bobbb

BlueZ said:


> Some absolutely fantastic posts from Bobbb as usual!


Thanks for the kind words. Blush.

It's not so hard to see the world as it is if you are prepared to throw off the propaganda that liberals have used to cover our eyes and muddy our brains.

Most of us are on this site because we clearly see the fundamental aspects which hold up society are eroding, so where we see clearly some aspects we can, with determination, also extend that same process to other aspects.

One person who doesn't share our collective ability is this writer from the New York Times. Let me illustrate:

So time and again, we see the decline of public services accompanied by the rise of private workarounds for the wealthy.

Is crime a problem? Well, rather than pay for better policing, move to a gated community with private security guards!

Are public schools failing? Well, superb private schools have spaces for a mere $40,000 per child per year.

Public libraries closing branches and cutting hours? Well, buy your own books and magazines!

Are public parks - even our awesome national parks, dubbed "America's best idea" and the quintessential "public good" - suffering from budget cuts? Don't whine. Just buy a weekend home in the country!

Public playgrounds and tennis courts decrepit? Never mind - just join a private tennis club!

I'm used to seeing this mind-set in developing countries like Chad or Pakistan, where the feudal rich make do behind high walls topped with shards of glass; increasingly, I see it in our country. The disregard for public goods was epitomized by Mitt Romney's call to end financing of public broadcasting.

A wealthy friend of mine notes that we all pay for poverty in the end. The upfront way is to finance early childhood education for at-risk kids. The back-end way is to pay for prisons and private security guards.​
His hammer is class envy and hatred of the wealthy. All the problems in society are merely nails for his hammer. This approach is nonsensical in that it doesn't even hold together internally never mind being an accurate reflection of reality. He lives in a magical world created by liberals where reality doesn't intrude in terms of cause and effect but where he believes that magical liberal solutions are all that is needed. So, point by point, let's see where he goes astray and where he leads astray people who listen to him.

What causes crime? Is it criminals or weakness of police? If a criminal breaks into your house with intent to murder you, does the fact that a well funded police force patrols your town stop this murder from occurring? Alternatively, if there are no criminals living in your town, what effect does a weak or strong police presence have on the crime rate? What he sees is a problem of not enough police whereas I see the problem as too many criminals.

Failing public schools. He sees the problem as not enough money being spent on education. I see the problem as too many students coming from cultures which don't value education and for groups with lower IQs. He sees all people as basically blank slates and I don't. Does he have evidence in support of his view? No, nothing that I can't completely eviscerate.

Public libraries closing. What does this have to do with the wealthy? Remember, that's his hammer. This is a budget issue for towns where these libraries are funded by property taxes. If Democrats have apportioned more of the town's budget to paying high civil service salaries, benefits and pensions, then the money has to come from some other budget category.

National Parks suffering from budget cuts. Same as with libraries. If entitlement spending increases then cuts have to be found elsewhere in the federal budget. This has nothing to do with the wealthy and is a direct consequence of growing socialism in government.

The threat of defunding PBS. If the market wants PBS programming then the market will pay for it, so why is government in the business of picking favorites in terms of TV networks? This should not be a function of government.

Early childhood education. This is not an upfront way to avoid bad outcomes in adulthood. We've had tens of thousands of years of parents raising good children into good adults without the benefit of liberal-inspired early childhood education programs. Secondly, studies show that the effects created by these programs evaporate after only a few years as the child's individuality overrides the learned behavior that was forced onto them.

The reality, as we all know, is clearly before our eyes but this tool prefers to see the world through the eyes of a liberal and wishes the world was as he imagines it to be and so his analysis of every problem is wrong and his solutions, which are based on faulty analysis, will be just as wrong.

The problem for society is that too many tools like this tool are in positions of power.

We see the problems and they don't. We don't have the power to change things, they do. We want to change things, they don't. We prefer to see the world as it is, they prefer to see the world as they want it to be.

In short, we're screwed. Double down on prepping.


----------



## Bobbb

Padre said:


> As the son of an immigrant I grew up with immigrants and didn't know ANY of them who fit your generalization. Now are there some Mexicans who come to this country and take handouts? Sure, but is that their fault or the fault of the a STUPID government that pushes handouts like a drug dealer offering free samples.


The government is not some entity which stands apart from society, it is the reflection of society. These handouts arise because people want them and they vote for parties and politicians who respond to these desires. Is the government forcing people to apply for Food Stamps?



> And it is racist to blame immigrants (Hispanics I would suppose) for being on the dole while ignoring the black and white natural born Americans (who in basically equal numbers) are on the dole.


I don't ignore anyone. First, immigrations effect on poverty:

In 2010, *23 percent* of immigrants and their U.S.-born children (under 18) lived in poverty, compared to *13.5 percent* of natives and their children.* Immigrants and their children accounted for one-fourth of all persons in poverty.*

The children of immigrants account for *one-third of all children in poverty*.

Among the top sending countries, poverty is highest for immigrants and their young children from Mexico (35 percent), Honduras (34 percent), and Guatemala (31 percent); and lowest for those from Germany (7 percent), India (6 percent), and the Philippines (6 percent).

Welfare Use

In 2010, *36 percent* of immigrant-headed households used at least one major welfare program (primarily food assistance and Medicaid) compared to *23 percent* of native households.

Among the top sending countries, welfare use is highest for households headed by immigrants from Mexico (57 percent), Guatemala (55 percent), and the Dominican Republic (54 percent); and lowest for those from Canada (13 percent), Germany (10 percent), and the United Kingdom (6 percent).

Health Insurance Coverage

In 2010,* 29 percent* of immigrants and their U.S.-born children (under 18) lacked health insurance, compared to *13.8 percent* of natives and their children.

New immigrants and their U.S.-born children account for* two-thirds of the increase in the uninsured since 2000.*​
If the goal is to reduce poverty in the US then adding more poor people to society isn't the way of going about it. Think of it this way. If you're making tomato sauce and you want to intensify the tomato flavor the best way of achieving that goal is to keep the pot of tomato sauce simmering on the stove top and to reduce the volume by letting the water evaporate. You will work against your purpose if you keep adding water to the mix every 30 minutes. You will never achieve your goal. If the goal is to reduce poverty, and the poverty rate is X%, then adding more people to the population from a group where the poverty rate is X% + 10%, actually increases the poverty rate rather than reducing the poverty rate.

The problems in the black community in the US are well known. As a society, it was easier for a 7/8 white society to offer support to the 1/8th of the population who was black than it is for a 1/2 versus 1/2 society. During the long interwar period of immigration restriction blacks saw massive gains in personal income. This preceded the Civil Rights era. These gains for blacks, heck for white poor, white working class and even white middle class, occurred because of labor market scarcity. For blacks these gains occurred in an environment of racial bigotry where employers really didn't want to hire black workers but were forced to because of labor shortages.

What do we have now?

A new study of black male employment trends has come up with the following extremely depressing finding: *"By 2002, one of every four black men in the U.S. was idle all year long. *This idleness rate was twice as high as that of white and Hispanic males."

It's possible the rate of idleness is even higher, said the lead author of the study, Andrew Sum, who is director of the Center for Labor Market Studies at Northeastern University in Boston.

"That was a conservative count," he said. The study did not consider homeless men or those in jail or prison. It is believed that up to 10 percent of the black male population under age 40 is incarcerated.

While some of the men not working undoubtedly were ill or disabled, the 25 percent figure is still staggeringly high. And for some segments of the black male population, the situation is even worse.

*Among black male dropouts, for example, 44 percent were idle year-round, as were nearly 42 of every 100 black men aged 55 to 64.*​
There is direct cause and effect at work here. Employers prefer to hire illegal Hispanics because they are hard workers and cause less problems on the job than do black employees, even matched for education levels.

These immigrants are not replacing America's black underclass, they're displacing them. We have a great many black citizens who depend on direct and indirect welfare and so what do we do, we bring in more poor people when we already have a surplus of poor people. The displacement effect isn't as strong in the white demographic but the stronger effect there is seen in wage depression. Being a worker in a slaughterhouse used to pay pretty good money but now it's a very low wage job. Anyways, in a welfare state this results in more people falling out of the labor market and depending on some form of welfare. Simultaneously, the importation of poor people results in welfare being expended on their behalf as well. This is completely crazy and irrational. From an economic perspective immigrants should be invited into the fold when they ADD value to the lives, and pocketbooks, of the citizens, rather than when they cause problems and expenses for the citizens.

We have a white underclass that needs our attention and we have a black underclass that needs our attention. The way to help them is not to import more low skill labor market participants for them to compete against in a depressed labor market.

As much as I defend the rich, this tactic is a morally repugnant way to enhance the welfare of the rich - gains to capital increase when there is labor market surplus and our immigration policy, flooding the labor market with legal and illegal immigrants when so many of our citizens are out of work, simply works to depress wages and increase the returns to capital. Making more money at the cost of destroying society is a pretty short-sighted way of advancing one's interests for that wealth will disappear when society goes down the crapper. The only way to preserve that wealth is to preserve society and society is preserved when most everyone has a vested interest in keeping it functioning and has moral buy-in to how society is structured.



> I pretty much agree, but you really gotta question the so called intelligence of people who reject the BIOLOGICAL natural law: "be fruitful and multiply." Many poor immigrants, who BTW also value the stable families that you suggest only come with being rich and natural born,* are pretty smart when it comes to reproducing.*


It does society no good for dependence to increase, especially when society is characterized by some degree of wealth redistribution.

What we as a society should be aiming for is to increase the number of net tax producers and to reduce the number of net tax recipients. Look at how fractions work - 1/2 is greater than 1/4 which is greater than 1/8 and so on. When we keep the numerator (tax producers) constant and increase the denominator (tax recipients) then the pie gets cut into smaller and smaller pieces. Our focus via immigration is to keep expanding the denominator when we should be working to reduce the number of poor people and expanding the number of middle class and upper class people. This would result in the burden of welfare being reduced for those who have to fund it, and if we're generous enough, we could actually expand the benefits to those who need it and still carry the load easily.

Importing poor and dumb people is not a practice which strengthens society.

That poor immigrant who is good at having children is putting a huge burden on the rest of us, whereas the high income lawyer and doctor couple who have only one child, are placing no burden on society and, in fact, they are best equipped to use their wealth to prepare their children to become net tax producers and so they should be having more children while the poor are having less. If the poor had less children then the resources of that poor family could be concentrated on their one child and give him the best leg up towards climbing the income and social mobility ladders. Instead, the poor family with multiple children has to ration out their modest resources and thereby lessen the social and economic mobility of their children while simultaneously shifting a number of expenses onto society at large.

All of these policies based on emotion and which run counter to reason are playing a large part in our long slow collapse. They're hollowing out the pillars of society - all looks normal until the rot collapses the pillars and brings the house shooting match down.


----------



## preponomics

Bobbb said:


> I believe that you either fundamentally misunderstand the causes of poverty or you overestimate the effects created by an economic system and how they affect the poor.
> Economic systems in themselves don't create wealth, individuals do.
> 
> The economic systems come into play at higher levels. It is at this foundational level though that the roots of poverty are found. Let me explain by way of example. If I have a clogged pipe in my home's plumbing I can fix that pipe myself or I can hire a plumber. If the solution is simple then I can do the work myself and I don't have to call on any expertise. However, if the work is complex then I am stumped. Now, I can persevere through the work, stop and search on the internet, drive to Home Depot and ask the salesman for his recommendation and so on and waste 10 hours of my time until I find a solution and there is a cost to this approach. Alternatively I can hire a plumber who can achieve the same result in 30 minutes. What we see here is the plumber creating wealth. He applies his expertise and in 30 minutes he achieves what would take me a whole day. If I take that day and go earn money at a job, then from those proceeds I take SOME money and pay the plumber and I have money left over. We are both better off via this trade.


I agree COMPLETELY that individuals create wealth, but, Austrian economics provide the best premise for individual prosperity. Keynesian economics is pure transfer of wealth and plunder of the individual, unless your the despot that receives the stolen wealth.



Bobbb said:


> The problem which causes poverty is that poor people have trouble producing wealth - they have few skills that they can sell which can't be replicated by others. One poor person can mow your lawn just as easily as another poor person or just as easily as someone's teenager.


I agree with this statement, that poor people have trouble in producing wealth BUT not because they are dumb, but because they are in a system of economic redistribution that prohibits economic freedom. Economic intervention empowers a socialized system of stagnation, and corporatism that uses advantage instead of competition. The poor will never be able to compete in a system where a few are lawfully advantaged. The honest capitalist will also die in a system of redistribution not matter the wealth or poverty level.



Bobbb said:


> The key to wealth or poverty is human capital - how much wealth can a person create via trading where both parties come out better off after the trade than by neglecting to trade. Poor people have little that they can trade in order to produce wealth. On the flip side, a money manager with a good track record can produce billions of dollars of wealth for himself and for those who trust him to manage their money. If we compare two such people, each managing a portfolio of $1 billion dollars, and one manager delivers an added 1% rate of return, then he's created an additional $10,000,000 of wealth for his clients. In terms of his compensation if the clients are happy to freely give this man $2,000,000 of the $10,000,000 of wealth he's created for them, they're still better off with the remaining $8,000,000 he created than by not paying him anything and forgoing the $10,000,000 he could create.


Its just a reality that people with business knowledge, and a lot of capital have an extreme competitive advantage over the poor that have fewer skills and no money. However, Austrian economics provides a level playing field for the poor to compete without the Keynesian system disallowing them a chance to complete. Free markets or real free markets does not care if your poor, middle class or rich. Also Austrian economics rewards hard work in many ways because a hard worker "keeps" what they make. Another reason why poor people do better in a true free market place, as they will work harder to survive in many cases.



Bobbb said:


> So, long before we look at economic systems we have to get right down to the very fundamental issue of how each of us create wealth in our daily lives. Some people create wealth by wrapping McDonald's hamburgers into paper wrappers. They create wealth via this work but the wealth they create is not worth that much and so, without any other skills demanded by the marketplace, these people get classed as poor.


I agree they get "classed poor", BUT with a Keynesian system of economics they will be forced to STAY poor. With a system where there is no economic intervention, many of the poor will use hard work and innovation to compete at high levels. It may start out with wrappers but it will end up as a franchise that can create thousands of jobs just like so many of our immigrants in the past have done.



Bobbb said:


> Your economic revolution is not going to change the process of how wealth is created.


I hope your wrong because I want individuals instead of government to define prosperity. I don't like the "new normal" which is Keynesian intervention that subtracts from the principles of individual economic independence.



Bobbb said:


> And this brings me back full circle to Trend #1 - importing and growing our own poor people is a problem. As a society we should be trying to reduce the number of poor people. We can all agree on that.


I dont agree that dumb poor people are the problem. I don't even believe that poor people are dumb.



Bobbb said:


> Liberals believe that socialism and the forced redistribution of wealth will achieve that goal and they're probably right but the cost of doing that is to make everyone equally poor and to rape people of their liberties.


I agree that redistribution of wealth and socialism, which is "economic intervention" will do the damage you just cited.

There is a huge difference between a modern big government liberal who believes in redistribution, and a classical liberal that believe is zero economic intervention. Many of our founding fathers were classical liberals. They were Lockean disciples in the classical liberal tradition.



Bobbb said:


> My solution is to reduce the number of poor people in our society and let other nations develop their own solutions. With a reduction in the number of poor people comes a lessened intensity for wealth redistribution and a lessened demand to rape people of their liberties.


To "reduce" the poor people will again be another form of economic and oppressive lawful intervention from government, and to me is immoral. To define an immigration policy that restricts further entry is not necessarily immoral but to me a bad decision. 
As legal immigration policy's with the right economics will cause prosperity on many levels. Especially people that are already grounded economically that are already here like it has in many times in our greatest years of U.S. capitalistic prosperity. If we had been wise enough to prevent economic intervention as well, it would have been even better and corporatism would not be a stain on our excellence capitalistic history that has made us the greatest economic success story in world history.



Bobbb said:


> Education is not the magic bullet here. Sure, via education a person can develop some skills which they can market to create wealth, but we when isolate both education and IQ and compare to income that is earned we find that education adds almost nothing once the effect of IQ is accounted for, the exception being education which imparts marketable skills, just as medicine, engineering, martial arts, and so on but even here it is IQ which is enabling the acquisition of these skills - a poor person who is dumb is not going to be equipped to study engineering no matter how many resources society targets to that goal.


I totally disagree that wealth levels, define intelligence. I also think that education empowers the individual to understand that intervention in various forms, has stolen their wealth for thousands of years.



Bobbb said:


> As for people developing a greater respect for principles of individual liberty have you seen the outcome of this last election? People want free stuff, not individual liberty. This is the humanity that we're working with so it's no use pretending that humanity is something that it's not.


I disagree, there were actually a lot less votes for the democrats who would be the voters for social programs and free stuff. The reason they won is because the percentage of libertarians, classical liberals, and liberty leaning republicans, moderate Dems, see that the right is just as corrupt due to massive economic intervention.
I think both parties are feeding the same system of Keynesian plunder.


----------



## Bobbb

preponomics said:


> Also Austrian economics rewards hard work in many ways because *a hard worker "keeps" what they make.* Another reason why poor people do better in a true free market place, as they will work harder to survive in many cases.


Yeah, it's great that your system allows people to keep what they earn. The problem is that there will always be people who earn more than others and the envious will use their political power to send government goons to take some of what has been earned and redistribute it to the envious. Your system doesn't provide a solution to this. In fact, your system likely makes it worse by increasing the disparity. We see this in public education. The public education system's Motto #1 USED TO BE "Allow each student to strive for the stars." Now the primary mission is "Close the Achievement Gap." If a school allowed each student to strive to the stars then it's quite likely that this would WIDEN the Achievement Gap. Even though each and every student would perform better under this "striving for excellence" system, the growing disparity would cause a huge backlash. How do I know this? Because it's already happened. High achieving students are steered into peer-teaching, standards have been lowered so that more can cross over the proficiency threshold, honor rolls are being abandoned in many schools because administrators don't like the results, class pacing is slowed down so bright student, and even those in the middle of the pack, are bored with the pacing.



> I agree they get "classed poor", BUT with a Keynesian system of economics they will be forced to STAY poor. *With a system where there is no economic intervention, many of the poor will use hard work and innovation to compete at high levels.*


Stop and think about this for a moment. For economic redistribution to take place, what needs to happen first? Wealth has to first be created before it can be distributed. Keynesian policies kick in after the individual creates the wealth. Your system does NOTHING towards helping a poor person negotiate a higher wage or fee for their services.



> It may start out with wrappers but it will end up as a franchise that can create thousands of jobs just like so many of our immigrants in the past have done.


When we all consider economic and public policy we shouldn't be using heroic accounts or fantastic tales or inspirational visions as the basis for our policy advocacy. Rather, we should be using the typical experience or the worst case experience and determining how the policy will play out in such scenarios.

Many immigrants and many poor people do rise above their poverty but there are two significant caveats in play. The first is that it is not the typical outcome for a minimum wage McDonald's employee to rise to become owner of a McDonald's franchise, so basing a policy on this expectation is going to lead to a lot of grief and heartache. Secondly, it's a mistake to look at historical immigrant experiences and extrapolate from the those past experiences to the present for two factors have changed, the first was the economic conditions of the past are different than the economic landscape of today and the second is that the origins, culture, and educational levels of past immigrants are not matched by the immigrants of today. Same with poor, non-immigrants. An immigrant or a poor person in 1930s America existed in an America in which assortative mating and meritocracy where rarely seen, meaning that a ditch digger's son could have more raw talent than the banker's son but in those days the lazy and stupid banker's son would have an easier rise than the smart and ambitious ditch digger's son. Since those days the pathways for talent have been opened up to the point where most employers go out of their way to avoid hiring incompetent children of rich people in order to make way for the competent son of a poor man so long as that young man an earn them money.

Further complicating matters is assortative mating and we see a lot of this now. In 1930's America and earlier, the banker might marry the waitress or the doctor might marry his nurse but these days we see more doctor-doctor marriages, cook-waitress marriages, cop-nurse marriages, and to the extent that there is heritability of traits tied to success, we will see stratification. This means that the past had a lot more instances of people being poor for one generation and their children rising above poverty due to the fact that the poverty was caused by circumstance and not by personal characteristics of the poor. That's no longer holding true. Now we're seeing a lot more intergenerational poverty, meaning that people who are poor are not poor because society is closing doors to them.

So you argument that a change in the rules of how we govern our economy is going to unleash all sorts of positive wonders doesn't, from where I'm sitting, look to be anchored in the world that we inhabit. In fact, it bears a lot of, sorry to insult you this way, resemblance to liberal pie-in-the-sky schemes where we have to cross our fingers and hope for the best as we step off the cliff of Good Hopes and Wishes.



> I dont agree that dumb poor people are the problem. I don't even believe that poor people are dumb.


OK, you don't agree. WHY don't you agree. Telling me why will help me understand your position. Telling me that you disagree and keeping unstated why you disagree doesn't help me at all.

Look, don't misunderstand me. I'm not talking in absolutes here. Not every poor person is dumb, not every dumb person is poor, some smart people are poor and so on. There are however pretty impressive correlations between income/wealth and education/IQ and IQ/behavior and behavior/income, so for instance if you're poor you have a higher chance of having lower levels of education, lower levels of future time orientation, lower levels of education and these all have significant impacts on life.



> To "reduce" the poor people will again be another form of economic and oppressive lawful intervention from government, and to me is immoral.


Sorry to be a broken record here, but simply stating positions that you hold doesn't inform me, or anyone else who is reading, about the merit of your positions. WHY is there immorality involved?



> To define an immigration policy that restricts further entry is not necessarily immoral but to me a bad decision.


WHY is it a bad decision?



> As legal immigration policy's with the right economics will cause prosperity on many levels.


HOW will it cause prosperity?

While you're thinking about that, here's something to ponder.










Do you see what that immigration policy produced? Here's a description of the Great Migration:

The outbreak of World War I created a larger demand for employment in the North, helping to promote further migration. This was followed by the passage of the Immigration Act of 1924, which essentially halted the majority of immigration from Europe,* further stimulating demand for workers.*​
You like economics, so tell us, what happens to wages when labor supply is restricted? What happens to the returns to capital and labor when there is a scarcity of labor compared to when there is a surplus of labor?

We have millions of unemployed, millions who've left the workforce, millions of underemployed, so why exactly are we importing more workers to add to the mix?


----------



## Magus

I nominate Bobb for the postal hall of fame!


----------



## JoKing

I may be out of place here being that I am offering feedback after only skimming the wealth of opinions in this thread, but what if the government initiated a policy for import tariffs to be implemented based on foreign labor and environmental impact? It seems too simple to me, but if you could get a $10 "Made in the USA" widget from China for a dollar, why not impose an import tax to level the playing field?


----------



## preponomics

Bobbb said:


> Yeah, it's great that your system allows people to keep what they earn.


Yes it is, its sweet



Bobbb said:


> The problem is that there will always be people who earn more than others and the envious will use their political power to send government goons to take some of what has been earned and redistribute it to the envious.


That's why I don't support socialism or economic intervention, because this is how the Keynesian model works. It intervenes with redistribution. 


Bobbb said:


> In fact, your system likely makes it worse by increasing the disparity.


Negative - Free markets create wealth for the poor, middle class and the rich. It's just tainted with economic intervention, socialism and corporatism. 


Bobbb said:


> We see this in public education. The public education system's Motto #1 USED TO BE "Allow each student to strive for the stars." Now the primary mission is "Close the Achievement Gap." If a school allowed each student to strive to the stars then it's quite likely that this would WIDEN the Achievement Gap. Even though each and every student would perform better under this "striving for excellence" system, the growing disparity would cause a huge backlash. How do I know this? Because it's already happened. High achieving students are steered into peer-teaching, standards have been lowered so that more can cross over the proficiency threshold, honor rolls are being abandoned in many schools because administrators don't like the results, class pacing is slowed down so bright student, and even those in the middle of the pack, are bored with the pacing.


I agree, this is why I don't support a public school system, and instead believe in local society managing their own "independent" school districts. I believe that parents and a local school boards should run their own schools and no intervention from the top should be in play with goal setting, causing yet more, "intervention that leads to socialism".



Bobbb said:


> Stop and think about this for a moment. For economic redistribution to take place, what needs to happen first?


Well I don't want it but in order for redistribution to take place, the law must be obtained by the few to empower themselves over the many economically, and then remove the principles individual liberty. They do this by controlling the money, which again is "economic intervention". They disallow people to "keep" their money and then pass a plethora of laws to make everything fair. Upon economic fairness thousands of laws can be passed every year. With each one individual liberty is destroyed and the economy is routed.



Bobbb said:


> Wealth has to first be created before it can be distributed. Keynesian policies kick in after the individual creates the wealth.


Well said, Keynesian transfer goes after the money and doesn't know where it is until a "person" prospers. Then when the system spots it, new laws get born to route it.



Bobbb said:


> Your system does NOTHING towards helping a poor person negotiate a higher wage or fee for their services.


True - as Austrian economics defends the individual and not government. In a true Austrian economy government does not have the authority to negotiate anyone's wealth level, thus redistribution doesn't exist.


Bobbb said:


> When we all consider economic and public policy we shouldn't be using heroic accounts or fantastic tales or inspirational visions as the basis for our policy advocacy. Rather, we should be using the typical experience or the worst case experience and determining how the policy will play out in such scenarios.


I agree



Bobbb said:


> Many immigrants and many poor people do rise above their poverty but there are two significant caveats in play. The first is that it is not the typical outcome for a minimum wage McDonald's employee to rise to become owner of a McDonald's franchise, so basing a policy on this expectation is going to lead to a lot of grief and heartache.


With Austrian economics, it does not "decide" the workers fate or the fate of the business they work for, thus it does not intervene. Therefore it will be up the worker on how much prosperity will be achieved. In a true free market that is not manipulated by redistribution, the worker can have realistic goals for their own prosperity.



Bobbb said:


> Secondly, it's a mistake to look at historical immigrant experiences and extrapolate from the those past experiences to the present for two factors have changed, the first was the economic conditions of the past are different than the economic landscape of today and the second is that the origins, culture, and educational levels of past immigrants are not matched by the immigrants of today.


Though technology has evolved our societies, the very simple basic rules of supply and demand still exist and if left alone they would function very well. Trading is a simply concept. People still make things you need and things you want.



Bobbb said:


> Same with poor, non-immigrants. An immigrant or a poor person in 1930s America existed in an America in which assortative mating and meritocracy where rarely seen, meaning that a ditch digger's son could have more raw talent than the banker's son but in those days the lazy and stupid banker's son would have an easier rise than the smart and ambitious ditch digger's son.


I will agree that the rich in many cases were advantaged over the poor, but corporatism is a bitter stain on the honest ethics of capitalism. Capitalism made us great economically but corporatism was an undercurrent that intervened with prosperity for many people.



Bobbb said:


> Since those days the pathways for talent have been opened up to the point where most employers go out of their way to avoid hiring incompetent children of rich people in order to make way for the competent son of a poor man so long as that young man an earn them money.


I agree that business owners are more open-minded to talent today more than ever. They want to maximize value by hiring the right people regardless of their wealth levels. Humble beginnings many times, works for a person instead of against a person in recent history.



Bobbb said:


> Further complicating matters is assortative mating and we see a lot of this now. In 1930's America and earlier, the banker might marry the waitress or the doctor might marry his nurse but these days we see more doctor-doctor marriages, cook-waitress marriages, cop-nurse marriages, and to the extent that there is heritability of traits tied to success, we will see stratification. This means that the past had a lot more instances of people being poor for one generation and their children rising above poverty due to the fact that the poverty was caused by circumstance and not by personal characteristics of the poor. That's no longer holding true. Now we're seeing a lot more intergenerational poverty, meaning that people who are poor are not poor because society is closing doors to them.


I disagree; internationally we have more socialism and wealth redistribution right now more than any other time in history, thus explaining the uncountable failing markets. If a nation overall is poor due to socialism then, the people there will also be poor. Socialism and Corporatism cause poverty and both use "economic intervention" to do it. If free markets "were left alone" they would prosper economically as the individual would solidify that prosperity.



Bobbb said:


> So you argument that a change in the rules of how we govern our economy is going to unleash all sorts of positive wonders doesn't, from where I'm sitting, look to be anchored in the world that we inhabit.


Your right it's not anchored in the world today that's why I am advocating that we stop using a system of transfer and use Austrian economics. Many of our founding fathers understood the dangers of central banking and economic intervention as well.



Bobbb said:


> In fact, it bears a lot of, sorry to insult you this way, resemblance to liberal pie-in-the-sky schemes where we have to cross our fingers and hope for the best as we step off the cliff of Good Hopes and Wishes.


No insult Bobbb - I understand your just trying to make a point and prefer to be frank about it - My good hopes are that people will see the dangers of Keynesian economics that are transferring their wealth



preponomics said:


> I dont agree that dumb poor people are the problem. I don't even believe that poor people are dumb.





Bobbb said:


> OK, you don't agree. WHY don't you agree. Telling me why will help me understand your position. Telling me that you disagree and keeping unstated why you disagree doesn't help me at all.


I am connected to a ministry that engages in private rescue initiatives and in my experience I have realized that many poor people are highly intelligent people. Will agree that education is absent many times, but that is because economic intervention has disallowed economic freedom in their country in various degrees. They are individuals that make decisions to improve their skills and knowledge that is afforded to them, no differently than the middle class or the rich. They work with what they have.



Bobbb said:


> Look, don't misunderstand me. I'm not talking in absolutes here. Not every poor person is dumb, not every dumb person is poor, some smart people are poor and so on.


I totally agree


Bobbb said:


> There are however pretty impressive correlations between income/wealth and education/IQ and IQ/behavior and behavior/income, so for instance if you're poor you have a higher chance of having lower levels of education, lower levels of future time orientation, lower levels of education and these all have significant impacts on life.


I agree with this to some degree. Knowledge and education is critical, not only for business success but also for understanding the principles of individual economic independence. If a people cannot protect themselves from economic intervention then they have no foundation to operate from and then with that foundation your point rings clear, that wealth brings momentum to success.



preponomics said:


> To "reduce" the poor people will again be another form of economic and oppressive lawful intervention from government, and to me is immoral.





Bobbb said:


> Sorry to be a broken record here, but simply stating positions that you hold doesn't inform me, or anyone else who is reading, about the merit of your positions. WHY is there immorality involved?


To lawfully remove a person from a country, "if" they have not broken the law means that, lawful intervention must step on the bill of rights to do it. Thus its immoral.



preponomics said:


> To define an immigration policy that restricts further entry is not necessarily immoral but to me a bad decision.





Bobbb said:


> WHY is it a bad decision?


Immigration is not a detraction of the economy except when the numbers are excessive and sudden. Even then the market will quickly and naturally adjust to it if "left alone", creating even more prosperity. However when immigration or especially illegal immigration is mixed with socialized healthcare, socialized economic fairness, and Keynesian economics, then massive redistribution will be the result. A system that will now transfer the wealth of a nation, and all people will suffer the redistributive poverty it brings, because people will not be allowed to compete in an honest capitalistic system. Due to economic intervention they are punished to compete and people already in the country will be punished even more, removing their competitive advantage over lawfully advantaged corporatism.



preponomics said:


> As legal immigration policy's with the right economics will cause prosperity on many levels.





Bobbb said:


> HOW will it cause prosperity?


If an economy is left alone, and people are allowed to trade, purchase and exchange without being punished financially for doing it, then more people bring more GDP to the table. No longer are you dividing the pie unto fairness but are creating more pies. Immigration, "legal immigration" will only work if Austrian economics is the foundation. If lawful economic and Keynesian intervention is prevalent, then the market place is distorted, propped up and routed to things that detract from the individual's ability to prosper. 
Immigration is a good thing "when" the economics is strait. If economics has been perverted then nothing makes sense. As you said, with prudence - it becomes musical chairs.



Bobbb said:


> While you're thinking about that, here's something to ponder.
> 
> 
> 
> 
> 
> 
> 
> 
> Do you see what that immigration policy produced? Here's a description of the Great Migration:
> The outbreak of World War I created a larger demand for employment in the North, helping to promote further migration. This was followed by the passage of the Immigration Act of 1924, which essentially halted the majority of immigration from Europe,* further stimulating demand for workers.*​You like economics, so tell us, what happens to wages when labor supply is restricted? What happens to the returns to capital and labor when there is a scarcity of labor compared to when there is a surplus of labor?


I agree that every single one of your charted example proves an outcome for your argument "when Keynesian Economics" is in play. But an Austrian economic foundation does not respond to immigration the same way, thus the data would be different. With Keynesian economics of socialism, the worker and the immigrant are "managed" through interventionist policies. Also a socialized system must respond with "free" things to all of these people. With Austrian economics all of this data would be different due to raw personal responsibility and private rescue.
I don't disagree with many of your arguments in this post, just your premise of economics that you stand your arguments upon. Austrian economics supports a capitalistic model that rewards the individual, Keynesian economics supports socialism, and rewards the elites in control of the economy.



Bobbb said:


> We have millions of unemployed, millions who've left the workforce, millions of underemployed, so why exactly are we importing more workers to add to the mix?


Economic intervention and corporatism is my answer. We punish the small business and reward the corporatist with lawful intervention. If the honest rules of capitalism were in play with real free markets then these immigrants would come over to work for the capitalist that would "not" be out of work but instead be prospering on every level. GDP would go up not down, and jobs would increase not decrease.


----------



## preponomics

JoKing said:


> I may be out of place here being that I am offering feedback after only skimming the wealth of opinions in this thread, but what if the government initiated a policy for import tariffs to be implemented based on foreign labor and environmental impact? It seems too simple to me, but if you could get a $10 "Made in the USA" widget from China for a dollar, why not impose an import tax to level the playing field?


JoKing -Your not out of place - please join in

If you are familiar with some of my posts, I will address feedback from a non-interventionist standpoint using the honest ethics of capitalism and Austrian economics, when dealing with economics.

Tariffs is probably responsible for 30% to 40% of the blame for the Great Depression ( http://en.wikipedia.org/wiki/Smoot-Hawley ). This was just one of many blows that caused the depression but if was a major factor.

Tariffs cripples our business markets here, not the countries we are trading with, as they will just prosper with another country. There are hundreds of thousands of small businesses in every vertical niche of the market place that depend on international trade. If you create an egregious tariff, it acts like a direct tax on our businesses here that operate with the honest rules of capitalism, due to higher amounts of money they will have to shell out. Then upon interventionist policy they will route the purchase behavior with regulation. This is an old ploy that is very effective in routing money to the few in corporatism. In the end, it just ends in business decline.

It seems that it would "protect" our jobs, but instead it causes our business owners here to suffer greatly causing layoffs and less profitability. The key is to have "less regulation" and "free trade", so that our business infrastructure here can complete in the international market place. The reason we are losing our manufacturing base, is because economic intervention "punishes them" to do business here. Tariff's is just another punishment that routes more money to corporate welfare. No different than subsidies, or crippling regulation.

As for environmental motivations, I believe that local society is best suited to manage it efficiently, as corporations and governments are the largest violators of destructive initiatives. Also "Tragedy of the Commons" concepts is a major contribution to massive environmental waste.


----------



## Bobbb

preponomics said:


> I agree, this is why I don't support a public school system, and instead believe in local society managing their own "independent" school districts. I believe that parents and a local school boards should run their own schools and no intervention from the top should be in play with goal setting, causing yet more, "intervention that leads to socialism".


Closing the Achievement Gap is not entirely some top-down directive. There are millions of teachers who enter teaching precisely to achieve that goal, so having complete, rather than partial, localized control of schools doesn't do anything about this issue. You're simply dodging the issue and filtering everything through your ideology.

The dynamic in play here is simple to understand - efficiency and equality are on different ends of one axis. The more efficient we become the less equality will result. The more schools allow each student to reach their maximum potential the more inequality will result. The more the economic system enables each of us to reach our economic potential the more inequality will result. The inequality results because we're not all identical in talents. If you open your eyes you see that there are plenty of liberals in society who have envy meters which top out at 1,000,000 compared to normal people with envy meters topping out at 100. When inequality arises, even if everyone is doing better than before, this gets liberals foaming at the mouth and that's when trouble starts. Until you devise a way to neuter liberals your fancy theories are unworkable.



> Well I don't want it but in order for redistribution to take place, the law must be obtained *by the few* to empower themselves over the many economically, and then remove the principles individual liberty.


Have you not been following the news in the United States after the elections? It wasn't the few that voted for redistribution, it was the many.



> Well said, Keynesian transfer goes after the money and doesn't know where it is until a "person" prospers. Then when the system spots it, new laws get born to route it.


Talk about missing the point. Please save yourself the effort of spouting Austrian dogma instead of responding to questions, I'm immune to dogma.

Again, here's the point - wealth has to be created and that creation occurs at the individual level when two people trade. Your Austrian principles do NOTHING to enhance the wealth that a low skilled person can create in the labor market, so your Austrian principles do nothing to enhance that person's prospects for greater income. In fact, absent redistribution that person's income falls. In a Democracy where that person's vote counts as equal to yours, they'd be voting against their self-interest if they sided with implementing an Austrian economic system. Your slogans about how Austrian principles are going to make them rich and unlock their wealth creating powers are as vapid as liberal slogans about diversity and tolerance.



> Though technology has evolved our societies, the very simple basic rules of supply and demand still exist and if left alone they would function very well. Trading is a simply concept. People still make things you need and things you want.


What happens to immigrant economic and social mobility when they enter the US labor force at a time when the rest of the world's economies have been devastated by World War? Add to the this condition the fact that between 1924 and 1965 the US had an immigration moratorium. I'll tell you what happened, immigrants and poor people did very well and they climbed the income and social mobility ladders. To look back on the experience of immigrants to the US from a century ago and then project that present-day immigrants are going to duplicate that same climb up the economic and social mobility ladders is asinine for today we live in a world where the US competes with many other nations and we live in a society where any gains to labor quickly evaporate by allowing more immigrants into the labor market, thus flooding supply and depressing the bargaining power of labor with respect to capital. The upshot here is that immigrants today WILL NOT replicate the patterns of earlier immigrants.

Your supply and demand remedial tutorials are as divorced from the real world as liberals pontifications about how homosexual marriages are identical to heterosexual marriages. You're both in la-la land with beautiful theories that crumble to dust when they touch reality.



> I disagree; internationally we have more socialism and wealth redistribution right now more than any other time in history, thus explaining the uncountable failing markets. If a nation overall is poor due to socialism then, the people there will also be poor. Socialism and Corporatism cause poverty and both use "economic intervention" to do it. If free markets "were left alone" they would prosper economically as the individual would solidify that prosperity.


What does that have to do with what I wrote? I'm referring to stratification in our own society and with respect to assortative mating we're now looking at lock-in from either environmental factors in family and/or genetic factors that intersect with sociologically important processes. The child of two mathematicians has a greater likelihood of having a higher IQ than the child of two bakers. In the past, when meritocracy wasn't as prevalent, IQ and other factors which lead to economic success in our present system where more evenly distributed amongst the population and throughout the class structure. The King's son could be an idiot and the stable boy could be a genius. Not so much anymore. This matters with respect to understanding why the poor tend to be poor. This is why we're seeing more intergenerational poverty. Your Austrian solution does NOTHING here despite your fanciful preaching. Address that. Oh never mind, I've already got your number. You're a fanboy who doesn't want to test his beautiful theory against the messiness of reality. The world has suffered so much from liberals shoving their beautiful theories, all untested, on societies and we're always cleaning up their messes. Looking at liberals and how they do things is not really a recommended path to emulate.


----------



## FrankW

Maybe we should sticky this thread.

The level of intellectual sparring going on is phenominal and not just from Bobbb, kudos also to preponomics as ,made thought provoking posts as well.

Keep it up fellas this proves to outsider we ar enot just a bunch of cave dwelllers!

Cheers,

: )


----------



## preponomics

Bobbb said:


> Closing the Achievement Gap is not entirely some top-down directive. There are millions of teachers who enter teaching precisely to achieve that goal, so having complete, rather than partial, localized control of schools doesn't do anything about this issue. You're simply dodging the issue and filtering everything through your ideology.


I am supporting the premise that individual local schools should be managed by parents and the school board, instead of a government socialized strategy handing it down. Your arguing message, I am arguing that intervention of the message is bad.



Bobbb said:


> The dynamic in play here is simple to understand - efficiency and equality are on different ends of one axis. The more efficient we become the less equality will result. The more schools allow each student to reach their maximum potential the more inequality will result.


Its not an absolute, and even if it were its not relevant in an a system where people charge their own efficiency, instead of government managing economic fairness. I don't measure equality based on what someone gets in a classroom or in the market place. I measure it based on natural rights, liberty and individual economic independence unaffected by socialism and managed intervention.



Bobbb said:


> The more the economic system enables each of us to reach our economic potential the more inequality will result. The inequality results because we're not all identical in talents. If you open your eyes you see that there are plenty of liberals in society who have envy meters which top out at 1,000,000 compared to normal people with envy meters topping out at 100. When inequality arises, even if everyone is doing better than before, this gets liberals foaming at the mouth and that's when trouble starts.


Once again this is based on what people "get" and that is a ploy of "fairness" which orchestrates poverty. In a free market system and with true independent schools managed by the parents, this will be "their" concern. Upon students maturing in society their prosperity will depend on their ability to compete. If they cant compete due to tragedy, physical calamity, or health etc... then I believe that private rescue is the best solution. Not government making it fair.



Bobbb said:


> Until you devise a way to neuter liberals your fancy theories are unworkable.


I have no desire to do anything to anyone with aggression, but I do want the modern liberal who embraces redistribution to realize that socialism leads to poverty for an entire nation.



Bobbb said:


> Have you not been following the news in the United States after the elections? It wasn't the few that voted for redistribution, it was the many.


I agree that socialism has become widely accepted but its not the fastest growing ideology in society, in fact liberty is. However in the ranks of government and corporatism it is heavily fortified, and financed.



Bobbb said:


> Talk about missing the point. Please save yourself the effort of spouting Austrian dogma instead of responding to questions, I'm immune to dogma.
> 
> Again, here's the point - wealth has to be created and that creation occurs at the individual level when two people trade. Your Austrian principles do NOTHING to enhance the wealth that a low skilled person can create in the labor market, so your Austrian principles do nothing to enhance that person's prospects for greater income.


I totally disagree - The poor does better with Austrian economics because they become fellow contributors of the GDP instead of subtracting from it with socialism, and Keynesian economics



Bobbb said:


> In fact, absent redistribution that person's income falls. In a Democracy where that person's vote counts as equal to yours, they'd be voting against their self-interest if they sided with implementing an Austrian economic system.


I agree, thus socialism is unfortunately born. That is socialism's greatest pitch - we will give you something to make it fair. Then with no educated understanding of what will happen to a socialized economy of interventionism, they vote away more wealth than they obtain. Yet those who control the economy, who route money through intervention use this very effective pitch on every side. The society that does not see economic intervention at work will fall for it often, as it promises ambiguous fairness that it can never deliver. Thus its critical to spread the word that Keynesian economics will throw your children into a pit of poverty after socialism matures. Austrian economics on the other hand will defend the individual by allowing them to KEEP their money.



Bobbb said:


> Your slogans about how Austrian principles are going to make them rich and unlock their wealth creating powers are as vapid as liberal slogans about diversity and tolerance.


Well, after all - we are very passionate about sound money, and individual economic independence 



Bobbb said:


> What happens to immigrant economic and social mobility when they enter the US labor force at a time when the rest of the world's economies have been devastated by World War?


I think it depends on how successful the invading army is. An Austrian does not support foreign economic interventionism as well as domestic. If the invader was highly successful crossing our borders then it would be dependent upon how much destruction they would cause. If successful then it would be brutal but upon survival, free markets recover rapidly,"if left alone".
However with a non-interventionist strategy in place and with a strong defense, I believe a stable nation using prudent Austrian economics would fair extremely well in-spite of smaller attacks, or natural catastrophe. It would take a short time before the free market would adjust, "if it is left alone". War is chaos and has extremely devastating results, as despotism is often times relentless.



Bobbb said:


> Add to the this condition the fact that between 1924 and 1965 the US had an immigration moratorium. I'll tell you what happened, immigrants and poor people did very well and they climbed the income and social mobility ladders.
> To look back on the experience of immigrants to the US from a century ago and then project that present-day immigrants are going to duplicate that same climb up the economic and social mobility ladders is asinine for today we live in a world where the US competes with many other nations and we live in a society where any gains to labor quickly evaporate by allowing more immigrants into the labor market, thus flooding supply and depressing the bargaining power of labor with respect to capital. The upshot here is that immigrants today WILL NOT replicate the patterns of earlier immigrants.


Again, socialism and fairness leads to poverty - Its never going to be relevant to me, as I believe in the individual having their own negotiating power over their own lives. I dont believe in an intervening government having the power to negotiate what people get. If the the free market was "left alone" there would be no need for government to offer to negotiate, as prosperity would be prevalent.



Bobbb said:


> Your supply and demand remedial tutorials are as divorced from the real world as liberals pontifications about how homosexual marriages are identical to heterosexual marriages. You're both in la-la land with beautiful theories that crumble to dust when they touch reality.


Supply and demand principles are a foundational focus with any good economist or economic strategy.



Bobbb said:


> What does that have to do with what I wrote? I'm referring to stratification in our own society and with respect to assortative mating we're now looking at lock-in from either environmental factors in family and/or genetic factors that intersect with sociologically important processes. The child of two mathematicians has a greater likelihood of having a higher IQ than the child of two bakers. In the past, when meritocracy wasn't as prevalent, IQ and other factors which lead to economic success in our present system where more evenly distributed amongst the population and throughout the class structure. The King's son could be an idiot and the stable boy could be a genius. Not so much anymore. This matters with respect to understanding why the poor tend to be poor. This is why we're seeing more intergenerational poverty. Your Austrian solution does NOTHING here despite your fanciful preaching. Address that. Oh never mind, I've already got your number. You're a fanboy who doesn't want to test his beautiful theory against the messiness of reality. The world has suffered so much from liberals shoving their beautiful theories, all untested, on societies and we're always cleaning up their messes. Looking at liberals and how they do things is not really a recommended path to emulate.


Yes I am a fanboy of Austrian economics, sound money, non-interventionism, free markets, individual liberty and individual economic independence 

"I also agree that the world has suffered so much" but because of interventionism using socialism, corporatism and Keynesian economics.


----------



## preponomics

BlueZ said:


> Maybe we should sticky this thread.
> 
> The level of intellectual sparring going on is phenominal and not just from Bobbb, kudos also to preponomics as ,made thought provoking posts as well.
> 
> Keep it up fellas this proves to outsider we ar enot just a bunch of cave dwelllers!
> 
> Cheers,
> 
> : )


Thanks BlueZ - Bobbb is smart 

I predict we will agree to disagree


----------



## Marcus

There's a couple of things that haven't been mentioned that also greatly affect the future prospects of immigrants beyond simply education.

The first, automation, has greatly reduced the amount of manual labor necessary to complete unskilled or semi-skilled tasks. Thus, there are fewer entry level positions available and more competition among the unskilled for those jobs. Companies seeking to control rising fixed costs (especially employee related healthcare) use automation to reduce headcount and thus achieve higher productivity which in turn allows those companies to compete better internationally and increase profits. These unskilled jobs are usually the first jobs uneducated persons entering the labor force get.

The second thing is assimilation. In the past waves of immigration, immigrants tried to fit in with the prevailing culture in order to achieve success. The degree to which this occurs today is diminished most probably due to an effort to promote multiculturalism.

Additionally, computer literacy, which is required for most higher paying positions, greatly depends on the immigrants country of origin and even more specifically, the locale of their original home. It's hard to expect someone with no electricity in their home to be able to understand how to operate a computer efficiently.

I have personally found that most immigrants are hard working folks. It's just that they start so far behind US natives in valued skillsets that they can rarely catch up without a huge effort. Truly anyone physically fit can operate a shovel digging a trench, but writing computer code requires a quite a bit of education. And even in the case of writing computer code, companies have found it more efficient to employ lower cost employees from places like India than to use Americans.


----------



## Bobbb

preponomics said:


> In a free market system and with true independent schools managed by the parents, this will be "their" concern.


All you've done is moved control down to the local level. This is good, but it still leaves the students and parents who disagree with their school policy having to comply with the policy, just as they would if the control was imposed from Washington. The dynamic - greater efficiency produces greater inequality is left untouched. All that you've touched is the ability of a local group to fiddle with where to find the balance. On the other hand, when the discussion is focused on the economy, you want to go full bore in terms of efficiency and not allow those who are lasered in on inequality to have a say and you want to impose this on the entire economy. How do you reconcile your two contradictory positions?



> I have no desire to do anything to anyone with aggression, but *I do want *the modern liberal who embraces redistribution to realize that socialism leads to poverty for an entire nation.


Try to reason with a liberal and then try to reason with a mule. You'll have better luck getting the mule to understand your reasoning than a liberal, so you wanting something simply isn't good enough, you should be laying out a plan for how you're going to achieve that which you want. Tell me, because I'm curious, how are you going to convince emotional liberals to go along with you?



> I agree that socialism has become widely accepted *but its not the fastest growing ideology in society, in fact liberty is.*


Oh yeah? Prove it.



> I totally disagree - *The poor does better with Austrian economics *because they become fellow contributors of the GDP instead of subtracting from it with socialism, and Keynesian economics.


Oh yeah? Prove it.



> Thus its critical to spread the word that Keynesian economics will throw your children into a pit of poverty after socialism matures. Austrian economics on the other hand will defend the individual *by allowing them to KEEP their money*.


Again, please anchor your theories in the real world. Why do the "takers" vote for the Democrats? They do so because they get the booty taken from the "Makers." So the question now becomes Who, whom? Who will steal from whom for whose benefit? The poor already get to keep the money they earn so your plan has nothing to offer them. With Obama sending goons out to steal money from the more productive, that stolen money gets directed towards Obama's supporters, so they actually like it more than what you're proposing.



> I think it depends on how successful the invading army is.


I wasn't posing a hypothetical, I was describing the state of the international economy after WWI, the interwar period, during WWII and after WWII. With much of the world's manufacturing base destroyed by those two wars and America's industrial base intact, things were golden for American labor during that period. The immigrant experience in America which saw a tremendous uplift for immigrants is not repeatable in the present day.



> Again, socialism and fairness leads to poverty - *Its never going to be relevant to me*, as I believe in the individual having their own negotiating power over their own lives. I dont believe in an intervening government having the power to negotiate what people get.


Oh yeah? Well, good luck with that. I hope prison life treats you well because trying to go your own way when liberals are controlling government is going to make you run afoul of the IRS pretty quickly.



> Yes I am a fanboy of Austrian economics, sound money, non-interventionism, free markets, individual liberty and individual economic independence


Blind faith in an ideology without knowing why you believe it and without being able to explain or defend your positions puts you in a boat similar to what liberals are rowing. I repeatedly asked you to explain and defend your propositions but all you give me is dogmatic slogans and wishful thinking. There are obviously people who are reading along in this thread and I doubt that you're making a convincing case to them, but maybe you are. Look, many of your positions are verifiably true, but those have little to do with Austrian economics, and so your bundling them into Austrian economic principles is muddying the water. Secondly, many here understand and sympathize with the merits of a free market system but your arguments amount to tautological statements and that's the source of my frustration with the line you're taking. You just keep repeating the same slogans and dogma and that isn't how argument works. What you really need to do is face-off against some liberals who reject your entire position and who, instead of asking you to defend your statements as I'm doing, instead work to refute your entire position. Fight them and convince them and sharpen your game.

I've engaged with you in an attempt to pull your theories into the real world, to get you to explain to us all how your vision would translate into real life and how it would affect the nation, the poor, what effect immigrants would have, how people would react to having the social welfare state removed from their lives, and you you respond with is the Hosanna of "It will be wonderful." That's faith, my friend, and that leaves me stone cold. I'm inclined to bow out at this point because it's no longer interesting to me to watch you argue theory and resist bringing that theory into the real world. I'm more interested in reading the nitty gritty of how to throw over socialism and rid it from our lives, not how beautiful and wonderful your theoretical, never implemented in the world, vision of Austrian Economics is. Hopefully someone else can jump in and provide your theoretical world view with the validation you desire for it.

I may come across as harsh, but no hard feelings from my side are intended. Peace.


----------



## FrankW

preponomics said:


> Thanks BlueZ - Bobbb is smart
> 
> I predict we will agree to disagree


Despie my earlier ringing endorsement of Bobb, its important to note that you also made many great points that deserve attention and reflection by all of us.

It is not often that one can feel one learned something by reading an internet thread of the 2 folks sparring but this just might be the exception.

I hope despite its lenght it will get the attention it deserves since both of you obviously put huge amounts of time into crafting coherent arguements.:congrat:


----------



## PrepN4Good

BlueZ said:


> The level of intellectual sparring going on is phenominal and not just from Bobbb, kudos also to preponomics as ,made thought provoking posts as well.
> 
> Keep it up fellas this proves to outsider we ar enot just a bunch of cave dwelllers!


It's like "The Geo-Political Shootout at the Fiscal Corral".


----------



## PrepN4Good

Padre said:


> *A drawn out collapse places real stress on your preps, particularly as more and more people begin to see the decline and begin prepping causing prices to rise *and perhaps the government to step in to control "hoarding" (or at least monitor it in preparation for confiscation). All you need to do is think about the cost of ammo--while I am sure the wars have increased the cost of ammo as has the price of metals--I believe a big part of that increase is increased demand from people like us, and its going to get worse so long as people (20% a present) are truly concerned about a collapse.


Coincidently, I went to Walley World this morning to pick up a few things, & took a walk thru the camping area to get a couple more 1 lb bottles of propane. There were NONE, nada, zip, zilch, bupkiss. Just a big fat empty space on the shelf where they usually have a several dozen. 

When I mentioned this to DH, he said, "Well, what did you expect? They discussed 'Doomsday Preppers' on 'The Five' on Friday; now everyone is going to be stocking up!"


----------



## JoKing

preponomics said:


> JoKing -Your not out of place - please join in
> 
> If you are familiar with some of my posts, I will address feedback from a non-interventionist standpoint using the honest ethics of capitalism and Austrian economics, when dealing with economics.
> 
> Tariffs is probably responsible for 30% to 40% of the blame for the Great Depression ( http://en.wikipedia.org/wiki/Smoot-Hawley ). This was just one of many blows that caused the depression but if was a major factor.
> 
> Tariffs cripples our business markets here, not the countries we are trading with, as they will just prosper with another country. There are hundreds of thousands of small businesses in every vertical niche of the market place that depend on international trade. If you create an egregious tariff, it acts like a direct tax on our businesses here that operate with the honest rules of capitalism, due to higher amounts of money they will have to shell out. Then upon interventionist policy they will route the purchase behavior with regulation. This is an old ploy that is very effective in routing money to the few in corporatism. In the end, it just ends in business decline.
> 
> It seems that it would "protect" our jobs, but instead it causes our business owners here to suffer greatly causing layoffs and less profitability. The key is to have "less regulation" and "free trade", so that our business infrastructure here can complete in the international market place. The reason we are losing our manufacturing base, is because economic intervention "punishes them" to do business here. Tariff's is just another punishment that routes more money to corporate welfare. No different than subsidies, or crippling regulation.
> 
> As for environmental motivations, I believe that local society is best suited to manage it efficiently, as corporations and governments are the largest violators of destructive initiatives. Also "Tragedy of the Commons" concepts is a major contribution to massive environmental waste.


I understand that their would be negative ramifications, but their is NO WAY that our economy will recover without turmoil being part of the process. There is no way that a foreign company could shift 80%+- of their exports without the demand.

I know that it's going to be painful too a lot of people to turn this thing around. The only other option I can think of(that's not saying much) is to lower the minimum wage to $10 a day.


----------



## Dakine

JoKing said:


> I understand that their would be negative ramifications, but their is NO WAY that our economy will recover without turmoil being part of the process. There is no way that a foreign company could shift 80%+- of their exports without the demand.
> 
> I know that it's going to be painful too a lot of people to turn this thing around. The only other option I can think of(that's not saying much) is to lower the minimum wage to $10 a day.


We're not at the collapse yet, but without a complete reset, $10 a day is a relative number. the minimum wage could be $10,000,000 a day if they just add enough zero's on the end.

the masses just spoke a couple weeks ago... the minimum wage is NOT going down. Not now, not ever. That only leaves one path to go down... inflation, hyper-inflation, recession, depression and then collapse.

Our debt ratios are actually WORSE than Greece, and WE fund GREEK bailouts because we provide 30% of the money in the IMF...

using a slow rolling model on collapse because "that's not how it happened over there" neglects to acknowledge that's not how it has to happen here.

I think we'll see a continued down slide and then like lemmings we'll jump off a cliff :wave:


----------



## preponomics

Marcus said:


> There's a couple of things that haven't been mentioned that also greatly affect the future prospects of immigrants beyond simply education.


I think your points are very impactful economically - here are my takes on it


Marcus said:


> The first, automation, has greatly reduced the amount of manual labor necessary to complete unskilled or semi-skilled tasks. Thus, there are fewer entry level positions available and more competition among the unskilled for those jobs. Companies seeking to control rising fixed costs (especially employee related healthcare) use automation to reduce headcount and thus achieve higher productivity which in turn allows those companies to compete better internationally and increase profits. These unskilled jobs are usually the first jobs uneducated persons entering the labor force get.


I think automation contributes to market prosperity in a similar way that division of labor did in industrial history. It prospers the company that achieves a lower cost to doing business, who then expands its investment, which requires more labor. Sometimes the new labor that is required will need different kinds of existing skills, new skills, or advanced skills. Overall the jobs are going to increase nationally. 
There have been many fears throughout world and US history in our modern age about automation eliminating the work force, in fact so much in the 1950's that is was an unfulfilled doomsday message. It has always historically done the opposite for overall job growth when the economy is healthy. There are however, a few isolated examples where a local economy that depended on a large plant or a few like production style factories, that had serious job loss for several years. Locally, it can be an impact, but overall the jobs increase, if no one is perverting the free market. Even locally if the market is left alone it will adapt quickly, but when fall out happens locally it usually gets propped up with socialized rescue in one form or another that detracts from the markets ability to function properly. 


Marcus said:


> The second thing is assimilation. In the past waves of immigration, immigrants tried to fit in with the prevailing culture in order to achieve success. The degree to which this occurs today is diminished most probably due to an effort to promote multiculturalism.


I think that cultural diversity within a prevailing culture has been around for a long time in almost every nation. The problem to me is that, if a specific group feels it necessary to have a different set of policies, or laws, unique to their cultural group, then the premise of law will be perverted. If the law orchestrates fairness for a special "group" instead of defending liberty for the individual, then it just ends up in a large entanglement of fairness, and orchestrated social programs. This also detracts from the overall prosperity of a country, and more importantly for the culture trying to get fairness from government, it hurts them too.

In the classical liberal tradition as adhered to by our founding fathers in the U.S., the law should defend individual liberty, and not a group of people of any kind. When the law defends "groups" instead of individuals, then this is how class systems are created and can even lead to the most diabolical forms of despotism in history.
The moment any social program is created to "give" a special group something, it detracts from a countries wealth. I think without the "fairness" immigrants and existing citizens both would prosper greatly. IF markets are left alone


Marcus said:


> Additionally, computer literacy, which is required for most higher paying positions, greatly depends on the immigrants country of origin and even more specifically, the locale of their original home. It's hard to expect someone with no electricity in their home to be able to understand how to operate a computer efficiently.


I agree, it typically starts out with very remedial type jobs, and in time upon opportunity they graduate into higher paying jobs. However if the economic premise allows for free markets, there will be a huge demand for jobs at every level. 


Marcus said:


> I have personally found that most immigrants are hard working folks. It's just that they start so far behind US natives in valued skillsets that they can rarely catch up without a huge effort. Truly anyone physically fit can operate a shovel digging a trench, but writing computer code requires a quite a bit of education. And even in the case of writing computer code, companies have found it more efficient to employ lower cost employees from places like India than to use Americans.


I agree. Typically immigrants come from a socialized or third world country where they can never see an opportunity to prosper. So when the chance finally presents itself, they kick in to work extremely hard. However if our country keeps electing corporatists, socialists and interventionist at every level, it wont be here that that opportunity presents itself.
I am a believer in free trade and not creating any laws that prohibit the honest capitalist from using outsourcing or products, whether domestic or foreign. We operate in an international economy, and if a foreign set of workers offer a benefit for a company here, then it will prosper that company to "grow" which causes more business to happen here (I am not referring to corporatism that leverage foreign labor with lawful advantage, but instead am referring to the honest free-market capitalist). As our GDP goes up, "jobs" go up and we remain competitive in the international market place. To use protectionism trying to keep out the outsourced worker simply cripples our own GDP by punishing our honest business owner here. If tariffs are further implemented and policies continue to cripple businesses here, then companies all over the world will continue to have the edge over hundreds of thousands of businesses here who no longer can compete. This is has been ongoing for some time. If they can complete, they will grow, and more jobs is the result, and even "better" ones will multiply.

If we were to have an Austrian Free Market - then
The immigrant that comes here and if they offer value, they will increase jobs, technology and prosperity for themselves, and every American overall. If they don't, then they will obviously do poorly at first, but will be forced to "improve", because there will be no social system to incentivize them to "get" something for free. Businesses will "keep" their money, instead of it getting taken and redistributed. Right now in our Keynesian economic, and socialist system, there is a safety net for them to fall back on, which changes the incentive, and "subtracts from our GDP instead of increasing it". 
The socialist will argue with the Austrian and say, "what about those who can't compete" how do you address that. The answer is simple, Private efficient rescue. It's not perfect, but it's much better than anything socialism has to offer. Society can never be utopia but it can have solid principles of liberty that protect free markets and the individual.

Anyway thats my views on it Marcus


----------



## preponomics

JoKing said:


> I understand that their would be negative ramifications, but their is NO WAY that our economy will recover without turmoil being part of the process. There is no way that a foreign company could shift 80%+- of their exports without the demand.
> 
> I know that it's going to be painful too a lot of people to turn this thing around. The only other option I can think of(that's not saying much) is to lower the minimum wage to $10 a day.


I agree - to turn it around is going to be "very" painful. One thing I haven't said is that Austrian economics and Free Trade are not a magical quick-fix, its a deep set of standards that are difficult to implement, once socialism has dug in its claws of decline. Only if the majority of Americans support it with several years at their back can it even work. I am with you this thing is could get bad. One reason why I am a prepper


----------



## Padre

Bobbb said:


> In 2010, *23 percent* of immigrants and their U.S.-born children (under 18) lived in poverty, compared to *13.5 percent* of natives and their children.* Immigrants and their children accounted for one-fourth of all persons in poverty.*
> 
> The children of immigrants account for *one-third of all children in poverty*.
> 
> Among the top sending countries, poverty is highest for immigrants and their young children from Mexico (35 percent), Honduras (34 percent), and Guatemala (31 percent); and lowest for those from Germany (7 percent), India (6 percent), and the Philippines (6 percent).
> 
> Welfare Use
> 
> In 2010, *36 percent* of immigrant-headed households used at least one major welfare program (primarily food assistance and Medicaid) compared to *23 percent* of native households.
> 
> Among the top sending countries, welfare use is highest for households headed by immigrants from Mexico (57 percent), Guatemala (55 percent), and the Dominican Republic (54 percent); and lowest for those from Canada (13 percent), Germany (10 percent), and the United Kingdom (6 percent).
> 
> Health Insurance Coverage
> 
> In 2010,* 29 percent* of immigrants and their U.S.-born children (under 18) lacked health insurance, compared to *13.8 percent* of natives and their children.
> 
> New immigrants and their U.S.-born children account for* two-thirds of the increase in the uninsured since 2000.*​


That immigrants are poorer is not a point of contention, its not immoral to be poor. When my mother came to this country she was allowed to take $10 by the Soviets. She was poor, now she is not, she never was on the dole.

That they use social welfare services, again, services offered by STUPID (mostly white) LIBERAL American citizens (not immigrants) in greater amounts since the 70s, is a function of their greater rates of poverty. Shame on you, though, you are doing what the liberals do playing with numbers.

AS A PERCENT perhaps they use social welfare at greater levels than citizens (who BTW are not Natives), but since there are more citizens the numbers using are very similar. Also note that your own numbers, IF YOU CAN READ STATISTICS, betray your argument.



> In 2010, 23 percent of immigrants and their U.S.-born children (under 18) lived in poverty, compared to 13.5 percent of natives and their children. Immigrants and their children accounted for one-fourth of all persons in poverty.


That's a 23:13.5 ratio, which is almost 2:1.



> In 2010, 36 percent of immigrant-headed households used at least one major welfare program (primarily food assistance and Medicaid) compared to 23 percent of native households.


That's a 36:23, which is 3:2.

That means that there are almost 100% more immigrants in poverty as a share of their population, but only 50% more immigrants on welfare. Given the fact that immigrants make up a far smaller share of the population these two facts undermine your argument. Not that I expect most people to be able to follow the statistical argument, that is why politicians use stats to make political points.

Your VERY impressive charts that attempts to suggest causation between immigration patterns and the breakdown of wealth, again, prove nothing, as a first year student in statistic knows that correlation does not prove causation. Is it chicken or egg that comes first? Does society relax their position on immigration when they are wealthier, or when they are poorer do they get wealthier BECAUSE they reduced immigration?

Sounds like a good old fashioned, well Old Testament at least, scapegoating to me.


----------



## Bobbb

Padre said:


> That immigrants are poorer is not a point of contention, its not immoral to be poor. When my mother came to this country she was allowed to take $10 by the Soviets. She was poor, now she is not, she never was on the dole.


I'm very comfortable with statistical analysis so please don't hold back if you have any criticisms on that front with respect to what I post.

Let me offer you a tip - when you analyze public policy you need to move beyond your own immediate exposure to the issue and look at both the large scale phenomenon in play and the extreme cases on the margin. Looking at your mother's experience doesn't tell us anything about the general phenomenon.



> That they use social welfare services, again, services offered by STUPID (mostly white) LIBERAL American citizens (not immigrants) in greater amounts since the 70s, is a function of their greater rates of poverty.


Well, greater rates of poverty is the issue here. It's not that poverty is the function which causes higher levels of welfare use that has the most policy significance, it's WHY those poverty levels increase which then in turn lead to increased utilization of welfare services.

When we import poor and, mostly, uneducated people into our nation and dump them into an already saturated low skilled labor market, what do you imagine results from this increase in labor supply? It pushes more people into poverty and it keeps many of those who've just arrived in poverty and unable to climb out because every time they take a step up the income ladder in come more immigrants to undercut them in the labor market.



> That's a 23:13.5 ratio, which is almost 2:1.
> 
> That's a 36:23, which is 3:2.


Exactly. The goal of immigration should be to improve the situation for America and for America's citizens. The goal of improving the life of the immigrant shouldn't come at the expense of the welfare of Americans. So what happens when you want your kettle of water to reach boiling temperature and you repeatedly add cold water to the kettle? What happens if you want to reduce poverty in the US and you keep adding immigrants who are twice as likely as citizens to be stuck in poverty? How exactly do you reduce the poverty rate when you keep adding people to the poverty rolls?



> That means that there are almost 100% more immigrants in poverty as a share of their population, but only 50% more immigrants on welfare.


Are you trying to push an argument similar to this: "We lose a dollar on every widget we sell but we'll make it up with volume."



> Your VERY impressive charts that attempts to suggest causation between immigration patterns and the breakdown of wealth, again, prove nothing, as a first year student in statistic knows that correlation does not prove causation.


Thanks for the remedial tip. Too bad it's not applicable in that I didn't rest my case on the correlation, I used those charts to illustrate the causative argument I had already laid out. To recap, when labor supply is restricted from growing via immigration, as it was for 40 years in the mid 20th Century, then labor supply will grow scarce and wages will increase. The consequence of this dynamic process is that the portion of value created through the combination of labor + capital that is directed towards labor will also grow, hence income inequality will diminish. That is a cause and effect argument. The charts demonstrate the effects which are predicted.

Point blank: In August of 2002 the labor force participation rate for men was 74.1% and in August of 2012 the rate had fallen to 70.4%, with an August drop-out of 348,000 people. At a time when we have HUGE numbers of people who are officially categorized as unemployed and an even LARGER number who are discouraged workers who've dropped out of the labor force, why EXACTLY are you proposing that we add another 1,000,000 legal immigrants, most of whom are poor and poorly educated, to the labor force and to the welfare rolls? Yeah, I get that this is a good deal for immigrants like your mother, but what exactly is the benefit to American citizens?


----------



## machinist

*Awesome Thread!*

So much intensive thought in the posts here, and good reasoning without the flames and strawman attacks I see on so many forums. KUDOS! :congrat:

I'd like to add that I believe the impact of more expensive energy (already mentioned) will be profound. Our productivity gains for several generations have been based on increasing the exploitation of cheap energy resources. As those energy "slaves" get more expensive, it puts a cap on how much productivity we can gain in that manner. As soon as our economy begins to improve a little, we will bump our heads on more expensive energy.

I spent most of my life as an engineer doing automation for the auto industry. Only in the relatively recent past has any attention been given to energy efficiency in industry, since it was cheaper to ignore it. That is changing, albeit slowly. For a while now, it has been cheaper to export manufacturing to a third world country to exploit cheap labor. Part of that savings is due to little or no regulation, nor employee safety constraints, nor environmental controls, and getting a much more favorable tax situation. It is a no-brainer why the US cannot compete head-to-head with those places, US automation efforts, notwithstanding.

I have a machine shop, so a few years back, I bought a granite surface plate, 18" x 24", imported from China. It was quarried there, ground, polished and lapped to less than .0002" flatness, shipped across the ocean, and shipped from the seaport to Chicago whence I ordered it. I paid $49.95 for it, from Enco. Enco made money on it, so it cost less than 50 bucks at that point. It cost me $53+ to get it shipped from Elkhart, Indiana to Salem, Indiana!!!!! 

I could have bought a surface plate made by Starrett, (in VT, IIRC), for about $300, plus freight from New England to Indiana. Same tolerances. My Chinese plate was thicker.

How much can you automate the process of making a surface plate? Not a lot, in my experience. It is a labor intensive, skill intensive process. The US is not competing here. Starrett is, IMHO, living off their reputation for quality at this time, and the US manufacturing industries that have supported them is being exported to other countries. I think it is a matter of time before they go the way of the shoe industry, textiles, cameras, electronics, Winchester Repeating Arms, cars, foundries, steel plants, and so many others, including Anheuser Busch, IIRC, to foreign ownership, if not the whole operation being exported, lock, stock, and barrel.

Bobbb said: "This means that the price of goods is going to increase while our incomes stagnate or fall."

Yep. Third world here we come. The US will have to make some dramatic adjustments as this plays out. I believe that the faster we as individuals can make those adjustments in our own lives, the better off we will be, long term.

The energy thing will make the cost of imported goods go even higher, even as the US dollar being devalued to deal with our debts also makes imports cost more. And the devaluation of the dollar will make the imported energy cost more, etc.. This is a no-win situation for the US.

Yes, we need to address all the salient issues that Bobbb laid out so well, and we also need to live within our means as a nation and personally. That means reverting to Austrian economics, I think, but before we can do THAT, we will have to kick the central bankers off their pedestals and take control of our currency once more to make it possible.

Good luck with that. It has been tried before without any lasting success.

I think that living within our means is a very broad topic that includes our food supply, energy supply, and depleting natural resources. It is too broad a topic to deal with here.

I believe the US (and a lot of the world, for that matter) is too sick to heal. Looks to me like we are going to have to let it all crash and burn before we can rebuild anything better. My thinking there is based on what we have presently for "leadership".

A lot of what I said is my own subjective opinions, but I think I can support them, if someone thinks it is necessary.


----------



## Bobbb

machinist said:


> So much intensive thought in the posts here, and good reasoning without the flames and strawman attacks I see on so mnay forums. KUDOS! :congrat:
> 
> I'd like to add that I believe the impact of more epensive energy (already mentioned) will be profound. Our productivity gains for several generations have been based on increasing the exploitation of heap energy resources. As those energy "slaves" get more expensive, it puts a cap on how much productivity we can gain in that manner.
> 
> I spent most of my life as an engineer doing automation for the auto industry. Only in the relatively recent past has any attention been given to energy efficiency in industry, since it was cheaper to ignore it. That is changing, albeit slowly. For a while now, it has been cheaper to export manufacturing to a third world country to exploit cheap labor. Part of that savings is due to little or no regulation, nor emplyee safety constraints, nor environmental controls. It is a no-brainer why the US cannot compete head-to-head with those places.
> 
> I bought a granite surface plate, 18" x 24", imported from China. It was quarried there, ground, polished and lapped to less than .0002" flatness, shipped across the ocean, and shipped from the seaport to Chicago whence I ordered it. I paid $49.95 for it, from Enco. Enco made money on it, so it cost less than 50 bucks at that point. It cost me $53+ to get it shipped from Elkhart, Indiana to Salem, Indiana!!!!!
> 
> I could have bought a surface plate made by Starrett, (in VT, IIRC), for about $300, plus freight from New England to Indiana. Same tolerances. My Chinese plate was thicker.
> 
> How much can you automate the process of making a surface plate? Not a lot, in my experience. It is a labor intensive, skill intensive process. The US is not competing here. Starrett is, IMHO, living off their reputation for quality at this time, and the US manufacturing industries that have supported them is being exported to other countries. I think it is a matter of time before they go the way of the shoe industry, textiles, cameras, electronics, Winchester Repeating Arms, cars, foundries, steel plants, and so many others, including Anhauser Busch, IIRC.


Excellent points. What I believe should be done is to substitute cheap American labor with machinery which has to be designed by expensive American labor and maintained by skilled and expensive American labor. The goal here is to continually refine the machining process so that the same job with machinery can be done at less cost than Chinese labor.

What sucks is the elimination of low skilled labor, especially for those in that labor market niche. The choice though is not between eliminating jobs which are then replaced with machinery and keeping those jobs, it's between keeping the business here in the US or losing it, and all jobs, altogether. So, it's better to create more technician and design and engineering jobs than do simply rely on importing low skilled labor which can't compete in terms of low wages with Chinese low skilled labor.

This brings me back to my point about immigration. We have enough of a challenge before us in finding economically useful work for our own high school drop-outs and others who are in our low skilled labor market segments without adding even more people to that market segment. We can't compete with China in terms of low wages. So, when we do compete let's do it in a way that cuts their advantage out from under them - eliminate their low wage advantage by working towards the goal of having machinery fabricate the item at less cost that a squad of low paid Chinese workers can fabricate the item.


----------



## Bobbb

machinist said:


> SThe energy thing will make the cost of imported goods go even higher, even as the US dollar is devalued to deal with our debts also makes imports cost more.


There is a tiny sliver of sunshine in this trend. It takes energy to transport goods long distance, not much in the case of sea travel, but it's still there and that cost is just going to increase. So for high mass items like granite, the calculation focuses on labor savings from Chinese laborers versus increased shipping costs for transporting granite half way around the world. Local firms with lower shipping costs, in bulk of course, can save money compared to Chinese competitors and afford to direct those saving to labor and still come out equal. Of course the cost of energy would have to go up much higher for present dynamics to equalize but every little bit can help.

To my point above - we're a richer country than China and we should be using that fact to our advantage just like China uses low wage labor to their advantage. Their cost for machinery is the same as ours, so if we cut out their advantage of low wage labor then their cost structure (ignoring government for the moment) becomes identical to ours.


----------



## Padre

Bobbb said:


> Let me offer you a tip - when you analyze public policy you need to move beyond your own immediate exposure to the issue and look at both the large scale phenomenon in play and the extreme cases on the margin. Looking at your mother's experience doesn't tell us anything about the general phenomenon.


I used my mother and my experience with REAL LIVE IMMIGRANTS as an anecdote and just that, not as a proof. But my anecdote suggests the truism though that most people who immigrate here do so to escape corruption, tyranny, and oppression, and that it tends to be difficult to escape these things and to take your wealth with you as you do.



> Well, greater rates of poverty is the issue here. It's not that poverty is the function which causes higher levels of welfare use that has the most policy significance, it's WHY those poverty levels increase which then in turn lead to increased utilization of welfare services.
> 
> When we import poor and, mostly, uneducated people into our nation and dump them into an already saturated low skilled labor market, what do you imagine results from this increase in labor supply? It pushes more people into poverty and it keeps many of those who've just arrived in poverty and unable to climb out because every time they take a step up the income ladder in come more immigrants to undercut them in the labor market.


Again, causation or correlation? Chicken or egg? Is the market saturated with low income workers because of immigration, or is it saturated because of liberal policies which promote a more lax work ethic and discourage Americans to transcend low income jobs. *Are you saying that we WANT Americans to have low income jobs? * And, all things being equal, if there is a glut of labor why don't employers simply hire "Americans"? I mean are you saying that Americans LIKE having workers who often can't speak English? Are they all anti-American monsters? Again, stupid liberal policies regarding minimum wages and benefits along with an Education (propaganda) system that discourages hard work, may be a better place to look for fault than immigration.



> Exactly. The goal of immigration should be to improve the situation for America and for America's citizens. The goal of improving the life of the immigrant shouldn't come at the expense of the welfare of Americans. So what happens when you want your kettle of water to reach boiling temperature and you repeatedly add cold water to the kettle? What happens if you want to reduce poverty in the US and you keep adding immigrants who are twice as likely as citizens to be stuck in poverty? How exactly do you reduce the poverty rate when you keep adding people to the poverty rolls?


Ok, so you still haven't proven that immigration doesn't. The folks who get good, decent, hardworking laborers at a price that makes it possible for them to stay in business (along with all those who benefit form this economic benefit) might disagree with your OPINION. If STUPID liberal policies make it impractical to hire Americans, or the poor american work ethic makes it unattractive, what do you think happens if an employer can't find affordable labor? Hostess anyone.

Your argument looses any possibility of of credibility because of the reality of free trade.



> Thanks for the remedial tip. Too bad it's not applicable in that I didn't rest my case on the correlation, I used those charts to illustrate the causative argument I had already laid out. To recap, when labor supply is restricted from growing via immigration, as it was for 40 years in the mid 20th Century, then labor supply will grow scarce and wages will increase.


You calling it CAUSATIVE does not make it or your arguments statistical evidence for anything.


----------



## preponomics

Bobbb said:


> All you've done is moved control down to the local level. This is good, but it still leaves the students and parents who disagree with their school policy having to comply with the policy, just as they would if the control was imposed from Washington. The dynamic - greater efficiency produces greater inequality is left untouched. All that you've touched is the ability of a local group to fiddle with where to find the balance. On the other hand, when the discussion is focused on the economy, you want to go full bore in terms of efficiency and not allow those who are lasered in on inequality to have a say and you want to impose this on the entire economy. How do you reconcile your two contradictory positions?


I think your right, in the old days parents use to fight it out at the local level for what was the curriculum, teachers etc&#8230;. As far as efficiency goes, to me that should be up to the parents and should not be the burden of the state to make it fair. I don't believe in social justice of fairness - but instead believe in "equal justice" or "constitutional equality" - meaning that the proper law of protecting life, liberty and property applies to all people the same, or "equally".



Bobbb said:


> Try to reason with a liberal and then try to reason with a mule. You'll have better luck getting the mule to understand your reasoning than a liberal, so you wanting something simply isn't good enough, you should be laying out a plan for how you're going to achieve that which you want. Tell me, because I'm curious, how are you going to convince emotional liberals to go along with you?


Well this is the challenge that many Austrian economists, and proponents of liberty have been discussing for a while. There are many strategies afoot but I think one-to-one sharing of the principles of liberty are the most effective, as winning a family member or a friend is very effective. Some claim you must get media and propaganda machines rolling to marginalize everyone you disagree with but to me it's more critical to simply spread the principles which stand on their own using common sense.



Bobbb said:


> Oh yeah? Prove it.


I will prove it if you will prove to the Christian that objectivist principles leveraging scientific deduction is the proper method for arriving at a philosophical truth? Or if you can prove to an Atheist that faith is superior to reason? Ideology is the matter of the heart and mind, that drives manifested behavior upon diverse outcomes.



Bobbb said:


> Oh yeah? Prove it.


http://www.heritage.org/index/ranking
The BOTTOM 100 countries with the LEAST economic freedom match up very well with the TOP 100 countries for the most poverty
http://www.aneki.com/countries2.php...ts=*--$&decimals=*--*&file=poorest&number=100
GDP will vary to offset some listings but free markets have "long" been understood by all economist to be synonymous with wealth and prosperity. Can you find poor people in every nation? Yes, but the poverty level in the US has televisions, and cell phones, thanks to free markets.
if you turn it around the top 100 countries with the MOST economic freedom also aligns well with your richest countries.



Bobbb said:


> Again, please anchor your theories in the real world. Why do the "takers" vote for the Democrats? They do so because they get the booty taken from the "Makers." So the question now becomes Who, whom? Who will steal from whom for whose benefit? The poor already get to keep the money they earn so your plan has nothing to offer them. With Obama sending goons out to steal money from the more productive, that stolen money gets directed towards Obama's supporters, so they actually like it more than what you're proposing.


Lenin, Stalin, Hitler&#8230;.? - Socialism/Keynesian economics, and Lenin style oligarchies/monarchies are responsible for over 200 million despotic deaths of innocent people just in the last 100 years.

The poor will do better when social policies are initially unveiled in the early years but it really doesn't take long for socialism to bottom out unto poverty. When it matures like with some socialist counties mentioned, it becomes despotically devastating



Bobbb said:


> I wasn't posing a hypothetical, I was describing the state of the international economy after WWI, the interwar period, during WWII and after WWII. With much of the world's manufacturing base destroyed by those two wars and America's industrial base intact, things were golden for American labor during that period. The immigrant experience in America which saw a tremendous uplift for immigrants is not repeatable in the present day.


I agree that war harmed the world economy. I also agree that we had the best leverage to manufacture as we faired well in War War II, but I also contend that it was our free markets and free trade that enabled our industrial complex to prosper like it did in spite of the social policies that kept us in the 14 year great depression. I do agree that world trade is now in a more competitive place and the "free'er" our businesses can be the better. Interventionist policies, that are punishing us is killing us competitively with international competitors.
Immigration is not an impact though if our economics becomes sound again and social programs cease. But with social programs I agree with you that its going to be bad.



Bobbb said:


> Oh yeah? Well, good luck with that. I hope prison life treats you well because trying to go your own way when liberals are controlling government is going to make you run afoul of the IRS pretty quickly.


I obey the law and advocate to anyone that they do the same. I do feel we live in turbulent times and if socialism continues to grow, the individual will end up being disallowed to own property without the States permission, as this is State sovereignties legacy for thousands of years.. This is why it's critical for Americans to vote back into place candidates that believe in "real" individual constitutional liberty.



Bobbb said:


> Blind faith in an ideology without knowing why you believe it and without being able to explain or defend your positions puts you in a boat similar to what liberals are rowing. I repeatedly asked you to explain and defend your propositions but all you give me is dogmatic slogans and wishful thinking. There are obviously people who are reading along in this thread and I doubt that you're making a convincing case to them, but maybe you are. Look, many of your positions are verifiably true, but those have little to do with Austrian economics, and so your bundling them into Austrian economic principles is muddying the water.


I disagree - Socialism, Keynesian economics, corporatism, and interventionism muddies the water. Austrian economics is simply - sound money with no government taking it from you with force.
Thank you for giving me some credit - I also think you bring some good points


Bobbb said:


> Secondly, many here understand and sympathize with the merits of a free market system but your arguments amount to tautological statements and that's the source of my frustration with the line you're taking. You just keep repeating the same slogans and dogma and that isn't how argument works. What you really need to do is face-off against some liberals who reject your entire position and who, instead of asking you to defend your statements as I'm doing, instead work to refute your entire position. Fight them and convince them and sharpen your game.


I disagree, and keep in mind, I am simply at this stage, still contesting your presented case. I will present my case why I believe Austrian economics defends the individual, and Keynesian economics egregiously steals a nation's wealth.



Bobbb said:


> I've engaged with you in an attempt to pull your theories into the real world, to get you to explain to us all how your vision would translate into real life and how it would affect the nation, the poor, what effect immigrants would have, how people would react to having the social welfare state removed from their lives, and you you respond with is the Hosanna of "It will be wonderful." That's faith, my friend, and that leaves me stone cold.


I will not pretend for a moment that Austrian economics brings utopia. In fact it will still be the real world where despotism will exist and calamity will still occur. However if these principles are integrated then people will be "free". No socialized government will "control" peoples outcome economically. It will however be much better than the slow death of transfer that Keynesian economics brings by perverting sound money and socialism perverting the law with fairness.



Bobbb said:


> I'm inclined to bow out at this point because it's no longer interesting to me to watch you argue theory and resist bringing that theory into the real world. I'm more interested in reading the nitty gritty of how to throw over socialism and rid it from our lives, not how beautiful and wonderful your theoretical, never implemented in the world, vision of Austrian Economics is. Hopefully someone else can jump in and provide your theoretical world view with the validation you desire for it.


The good news is, we are both on the same side in a major way, as we both see socialism as a serious problem in our economy. I think your concerns are very founded and respect very much that you are a deep thinker that will not accept things just because they sound rosy. It's my hope you will not bow out because I do want to offer my case properly and with your perception would appreciate your objectivity


Bobbb said:


> I may come across as harsh, but no hard feelings from my side are intended. Peace.


No worries, I understand completely - sometimes when debating like this being frank does get to the point more quickly


----------



## preponomics

machinist said:


> Yes, we need to address all the salient issues that Bobbb laid out so well, and we also need to live within our means as a nation and personally. That means reverting to Austrian economics, I think, but before we can do THAT, we will have to kick the central bankers off their pedestals and take control of our currency once more to make it possible.
> 
> Good luck with that. It has been tried before without any lasting success.


We have removed central banking twice in our history so far but you are right it didnt last. It is my hope that our nation will return to the principles of individual liberty once again. This time with better education to not make the same mistake that we made in 1913 creating the Fed.


----------



## machinist

Quote from Bobbb,
"To my point above - we're a richer country than China and we should be using that fact to our advantage just like China uses low wage labor to their advantage. Their cost for machinery is the same as ours, so if we cut out their advantage of low wage labor then their cost structure (ignoring government for the moment) becomes identical to ours."

Yes, we SHOULD be paying what jobs are actually worth here, but it isn't working that way, although it seems things are trending in that direction as labor unions lose some power. That levelling effect will continue, until things reach a balance. 

On the cost of machinery, most of the dedicated automation and much of heavy equipment, as in steel mills, and much more, are custom made nearby. Only very recently has any significant amount of those things been imported at the same cost as the Chinese would pay for it. So, much of the special equipment costs much more in the US than in China. I spent a lot of years buying this stuff, and overseeing the building of it. What you said is true on a lot of construction machinery, and other "frangible" items, but not so much on special factory equipment. And installation and debugging remains a local effort, at local rates. 

I also doubt that higher energy cost will favor the US all that much due to shipping costs. There are too many other variables, like shipping volumes, mode of transport, US domestic freight costs vs Chinese domestic freight costs, etc. I do agree that things like granite plates will work as you said to more favor the US. 

For much of what the US needs in the future, domestic production should be favored due to dollar devaluation, primarily. An anecdote in that direction comes from Brazil in the mid-1980's, when inflation was rampant there. An engineer I worked with was sent to our plant in Brazil on a technology exchange and entertained as their guest. His dinner cost a fistful of Brazilian currency, although it was all locally produced food. Imported food would have been impossibly expensive. But when the exchange rate was factored in, his lavish dinner cost under $20 US. 

Currency wars, now ongoing, can have a major impact on our future, making it impossible to tell just how some things are going to work out. At one point I could buy #10-32 threading taps for about $4 a dozen, and with 3 dozen they threw in a really good micrometer, all made in Poland and excellent quality. Poland has some excellent toolmakers. If I'd bought US made stuff, the pile would have cost over $100 then, compared to about $15 including shipping. But at the time, Poland was emerging from Communism and the Zlotny was worth practically nothing. Today, the price of the same fine Polish made tooling is far higher. 

No way to factor those things in ahead of time, that I can tell.


----------



## Marcus

preponomics said:


> I think automation contributes to market prosperity in a similar way that division of labor did in industrial history. It prospers the company that achieves a lower cost to doing business, who then expands its investment, which requires more labor. Sometimes the new labor that is required will need different kinds of existing skills, new skills, or advanced skills. Overall the jobs are going to increase nationally.
> There have been many fears throughout world and US history in our modern age about automation eliminating the work force, in fact so much in the 1950's that is was an unfulfilled doomsday message. It has always historically done the opposite for overall job growth when the economy is healthy. There are however, a few isolated examples where a local economy that depended on a large plant or a few like production style factories, that had serious job loss for several years. Locally, it can be an impact, but overall the jobs increase, if no one is perverting the free market. Even locally if the market is left alone it will adapt quickly, but when fall out happens locally it usually gets propped up with socialized rescue in one form or another that detracts from the markets ability to function properly.


In some cases, I can agree with your reasoning. But I can also point out other examples where automation severely reduced low end jobs permanently. In agriculture, the motorized cotton picker eliminated the need for traveling crews to pick the bolls. Since the 1930s, the number of people employed as farmers has been greatly reduced primarily due to efficiencies of scale caused by motorized farming.

In the automotive industry, a considerable amount of welding is now done by robots. The old welders *may* have been retrained to another job or they may have left to weld in another industry. In the first case, they probably earned lower wages while in the second case, they depressed the job market for welders.

Automation leads to greater prosperity * for the owners* of the automation. Whether the owners choose to re-invest the additional profits back into the business is a decision based on economic and political factors. The farmer could expand his acreage to take advantage of his increased efficiency, but at some point, the law of diminishing returns and his available work hours limit the expansion.

Similarly, a car plant could increase production but only to a point. Why would a plant produce much more cars than the market demands unless they are the most cost efficient producer in the industry? And even then, they'd only produce enough to cause problems for their competitors.

Other examples are CAD/CAM and especially 3D printers. When 3D printers become a viable industrial possibility, there will be massive employment dislocations. 3D scanners will be used to generate a computer model of a part which will then be manufactured perfectly *every time.* The expertise will be programmed into the scanners and printers negating the need for highly skilled machinists. Combined with robots assembling the parts, there will be no need for much human interaction or very many employees in the factory of the future.


----------



## machinist

Qute from Bobbb,
"...it's better to create more technician and design and engineering jobs than do simply rely on importing low skilled labor which can't compete in terms of low wages with Chinese low skilled labor."

Agreed. The problem I see with this is the exporting of entire industries, leaving nothing at all here. We have a lot of good machinists and toolmakers in the US that are working at menial jobs, for lack of an industry to employ them. I personally know a bunch of them. I think it is too late in the process for the US to do the bootstrap effort to come back. 

As time goes by, those skilled people are not being replaced as they age. Soon we won't have the the skills to apply to restarting US industry. The support industries die along with the major ones. Recently, my son in law's tiny 2 person fabrication shop got a request for quote from Ford Motor Company to build some pallet racks for their warehouse. It seems that during the automotive downturn over the past few years, the two makers of those modular pallet racks both went bankrupt. 

He declined the quote. He was closing the shop because he can't afford to comply with Obamacare next year. He got a job as a Tig welder that makes less money, but pays his insurance. His new job is making aerospace parts, so that is good as long as the military budget holds up.

Marcus, 

I agree on the automation thing. The whole purpose of automation is to reduce labor content in the product. Like you said, there is a limit to how much extra product can be sold, so that limits the total employment in the business. Result is fewer jobs in the factories and more people looking to work at Wal Mart. I saw this happen relentlessly over 35+ years as a direct result of what I did for a living. 

But, I doubt VERY seriously that the vision of the "no-people factory" will ever be realized anywhere. I had too many years working to keep all that marvellous stuff running. That 3D printer technology is pretty over-hyped, IMHO. Like CNC and Cad-Cam, it has very limited application, and requires an horrendous support system, all with very limited production rates. That's why high production manufacturing uses "hard" automation (specially designed for the purpose), because the exotic stuff is far too slow. Been there, done that, got the greasy tee shirt. 

I closed our machine and welding shop. I'm investing some money in basic food production stuff. Beats the heck out of central bank interest rates ATM. If I need more money, I'll go back to fixing farm equipment. I'm not one of those engineers that is afraid to get dirty.


----------



## Marcus

preponomics said:


> Lenin, Stalin, Hitler&#8230;.? - Socialism/Keynesian economics, and Lenin style oligarchies/monarchies are responsible for over 200 million despotic deaths of innocent people just in the last 100 years.


Not to nitpick, but the Congressional Record has the number at 135 million in the 20th century who were killed by their own governments. This is more people than all the people killed in all the wars throughout history up to 1900.


----------



## Bobbb

Padre said:


> Is the market saturated with low income workers because of immigration, or is it saturated because of liberal policies which promote a more lax work ethic and discourage Americans to transcend low income jobs.


Low skill is low skill is low skill regardless of what welfare programs are in place. The mean IQ of the American population has now slipped to 98. The simple fact is that half of the population has an IQ of 98 or less. This is a perfectly fine level for success in America but keep in mind that as we move down that IQ ladder things get tougher for people.

We're drawing most of our immigrants from the bottom half of this scale, thus lowering our national mean IQ score as well. Other countries screen applicants for graduate degrees, for bringing wealth with them, for income earning ability, for language proficiency and so on, immigrants who will enhance the quality of life for existing citizens. We base our immigration policy on lottery, on illegals crossing the border, on farm-worker visas, on low wage tech workers, check this video and on family reunification. Most of our categories either help the immigrant or help a specific industry, and so most immigrants are not chosen to provide for a better America, rather America has to bend to accommodate them.

Ok, that was veering a bit off track, so back to your point. Here's what we know - illegal Hispanic immigrants have made tremendous inroads into the low wage sector and done two things. The first is that they seriously displaced blacks from that sector. Employers prefer the work attitudes of these Hispanic immigrants. Good for the immigrants and good for the bosses. Is everyone happy? No, not quite. Those blacks who were displaced didn't climb the income mobility ladder, they fell off the ladder and into the taxpayer's lap. Not so good for them and for taxpayers. Further, there is a load of welfare spending that America directs to low income citizens via indirect spending, for instance, a low income person can rarely pay enough in taxes to pay the tab to educate one kid, never mind many kids, in public school when the cost of education is $11,000 per year. This isn't seen as welfare, but it certainly is redistributive. So when an immigrant displaces an American, they also create new opportunities for more indirect welfare spending in addition to creating the direct welfare spending which results from workers being displaced. The second aspect is the wage depression, which I'll address below with evidence drawn from meat packing.

It's all well and good to complain about the work habits and attitudes of America's unemployed but that doesn't solve the problem and importing replacement workers for them also doesn't solve the problem, it adds to the problem.

So to answer your question, the market is saturated and it doesn't matter why it's saturated. If it's saturated because Americans are lazy, the solution isn't to bring in more welfare dependent immigrants to add to our burden.



> And, all things being equal, if there is a glut of labor why don't employers simply hire "Americans"?


Watch the video. It's in an employer's interest to pay less in wages so that they can keep more in profits. That's understandable. The problem here is that government shouldn't be advocating the same policy so that it disadvantages labor and directs advantage to capital.

The usual debate follows this form:

Employer: I can't find any Americans willing to do this job so we need to bring in more immigrants.

Employee: I'm willing to do the job but I want more money per hour than you are offering.

Immigration shouldn't be used as a means of "strike breaking" here. When immigrants flood the labor pool, they depress wages and they drive Americans out of the labor force into unproductive idleness, into activities which don't produce economic growth, like being a stay-at-home mom (which produces positive value but doesn't produce income) or onto social welfare programs. Many of these people would like to be in the labor force but not at the low wages that are being offered. So this dynamic increases our costs of welfare and we add to that cost by bringing in new workers who require welfare supports.

These jobs can be filled by Americans if the employers simply raise the wages that they are offering. This was clearly demonstrated in the meat packing industry after some local INS raids looking for illegals. Or this - Look at this lawsuit:

The lawsuit claimed that one of the plaintiffs applied for a job at the Howard Industries electrical transformer plant in Laurel, Miss., every three to six months beginning in 2002, but wasn't offered a position until after the 2008 raid. The other plaintiffs made similar allegations.

Immigration agents detained nearly 600 illegal immigrants during the raid at the sprawling plant. Most of them were deported, though a handful faced identity theft charges. The company was fined $2.5 million in February 2011 after pleading guilty to conspiracy to violate immigration laws.

The lawsuit claimed Howard Industries not only knew it was hiring illegal immigrants, but instructed some on how to get false identities and concealed the fact that hundreds of employees were illegal immigrants. Federal authorities made similar allegations against the company.​
Or this, and note the reporting on wage levels at the end:


This time, federal agents were armed with criminal charges, accusing some workers of identification theft and forgery, and disrupted not just one work site but an entire company. Arrested were 1,282 Swift workers, about 9 percent of the work force at six plants . . . .

. . . the Marshalltown plant raised its starting wage from $9.55 to $11.50 in an attempt to fill the vacancies, said Jim Olesen, the union's local president.​
I think in your rush to respond you missed this direct question that I wanted you to address, so I'll just repeat it:

Point blank: In August of 2002 the labor force participation rate for men was 74.1% and in August of 2012 the rate had fallen to 70.4%, with an August drop-out of 348,000 people. *At a time when we have HUGE numbers of people who are officially categorized as unemployed and an even LARGER number who are discouraged workers who've dropped out of the labor force, why EXACTLY are you proposing that we add another 1,000,000 legal immigrants, most of whom are poor and poorly educated, to the labor force and to the welfare rolls?* Yeah, I get that this is a good deal for immigrants like your mother, but what exactly is the benefit to American citizens?​
Eagerly awaiting your reply.


----------



## machinist

US wages are headed DOWN. That probably means most people won't be able to afford a Mcmansion and 3 new cars. It will be more like subletting that McMansion into 4 or more apartments with multiple residents in each unit. Spoiled US citizens will be dragged there, kicking and screaming, maybe, but they will get there, just the same. This is reality today in my daughter's "gated community" in San Diego, where the homeowners' association rules disallowed subletting. But today, the HA is broke and gone after numerous foreclosures, and the rules no longer apply. So, there are investment groups who bought many of those big homes dirt cheap and turned them into multiplex apartment houses. 

A combination of a failed currency, failed economic policies, failing oil wells, failing business models, and failed work attitudes will be augmented by rampant socialism to speed us on our way.


----------



## Bobbb

machinist said:


> Agreed. The problem I see with this is the exporting of entire industries, leaving nothing at all here. We have a lot of good machinists and toolmakers in the US that are working at menial jobs, for lack of an industry to employ them. I personally know a bunch of them. I think it is too late in the process for the US to do the bootstrap effort to come back.


This hollowing out of America's manufacturing infrastructure didn't happen over night and it won't be fixed over night, so it really is a matter of tough luck for the victims. However, that shouldn't mean that we are facing structural impediments which preclude a rebuilding of a different type of manufacturing infrastructure. When China started it's climb it didn't have an interlinked network of suppliers and infrastructure in place from the get go. They built their system piecemeal just like we dismantled ours in a piecemeal fashion. We can rebuild, we have the technology to build the world's first bionic man. OOps, sorry strike everything after rebuild.



> As time goes by, those skilled people are not being replaced as they age. Soon we won't have the the skills to apply to restarting US industry.


We don't have the skills easily available, just like China didn't have a whole bunch of idle specialists twittling their thumbs. They developed that skill base from nothing. We can rebuild.



> Result is fewer jobs in the factories and more people looking to work at Wal Mart. I saw this happen relentlessly over 35+ years as a direct result of what I did for a living.


We will always have citizens who are not capable of working beyond being a Walmart greeter. Not everyone can be an engineer, lawyer, doctor, scientist, and so on, nor can everyone be a welder, machinist, CAD operator, and so on. That's fine. The goal though should be to minimize the number of citizens who fall into the low skill category and to uplift as many as we can to higher rungs on the income and skill ladders. Industries which are dependent for their survival on having ready access to low wage labor are cancer for the US. We need to stop feeding those industries with imported low wage labor.

From my calculations, we follow a more productive road by hiring 2 engineers and 10 technicians to run a factory than by hiring 2,000 minimum wage workers to do the work instead of machinery.



> But, I doubt VERY seriously that the vision of the "no-people factory" will ever be realized anywhere. I had too many years working to keep all that marvellous stuff running.


It's fine to have a goal to work towards but I don't believe it has to be an all or nothing proposition and I don't believe that that is your position either. It really comes down to efficiency. You working all those years to keep automated equipment functioning creates value for your employer. The question is whether the cost of your services plus the cost of the machinery and the financing cost of that machinery was more or less than the cost of the more labor intensive alternative.

I'd prefer an outcome of more expensive and highly qualified labor being used in small groups than the alternative of vast armies of low waged workers trying to do what machinery can do.

A robot doesn't have kids who need education, it doesn't commit crimes so we don't need as many police, courts, jails, it doesn't require social services to investigate the robot for whatever those people think is wrong, and so on. You get the point. Machinery reduces the cost of externalities that low wage workers produce for society. We need to be pushing up income levels so that indirect subsidies are reduced and to push up income levels we need to have workers who can produce more economic value per hour of time. This is where high skilled workers have the edge.


----------



## Bobbb

machinist said:


> US wages are headed DOWN.


Yes and No. Some, or even most, wages are heading down but some wages are going to go up. This is what drives liberals batty - the inequality gap.

Those jobs which face international labor competition are going to see wage declines, job losses and offshoring. Wages, like water, will find a new level.

Those jobs which are either immune to international competition, are plugged into government imposed job protection schemes (rentseeking, to be technical) and those jobs where a lot of value is produced by the worker will do ok. The classic example of the latter phenomenon is movie production. In the old studio days, most of the value went to the studio and stars got salaries, even generous salaries. Now a big movie star, say Tom Cruise, can capture a lot more of the value that his presence brings to a movie production and the studio gets less. This same principle applies to writers, inventors, financial folks, athletes, and so on. If you can produce a lot of value for someone else, especially in a larger globalized market compared to operating in a smaller national market, then you can expect to see your income rise. That however doesn't capture most of the people in the US.

So the trick here is to close the gap in order to buy social peace. The liberal way of taxing and redistributing is offensive to dignity as well as fairness, never mind the serious harm it does to efficiency. Labor market supply restrictions in conjunction with efforts to move people up the job skill ladder and to reduce the reliance on cheap labor industries will have cost-lowering ripple effects throughout society as well as rebalancing how profit is allocated between capital and labor.

The goal here should be to try to reduce as much as possible the wage depression effects that arise from globalization and to maximize the wages which result from higher paying professions and work. It's a labor force rebalancing that we need rather than a wage rebalancing. The types of work that we do needs to climb up the sophistication ladder and this means fewer jobs for low skilled workers.


----------



## machinist

Bobbb,

I like your goals, and I do think they are achievable, but not with things as they are in re TPTB. Yes, we can grow a new skilled workforce. It just takes time. I don't think we disagree at all, except maybe in perception of how long that may require. 

I spent a couple years at a new factory training housewives to do precision work and inspection. These ladies were the beneficiaries of a govt. training program and had never worked in the public arena before. Their jobs were contingent upon them learning how to measure in ten-thousandths of an inch, and operate high tech equipment--really a semi-skilled set of tasks. Took a couple years, and we had all the resources you could ask for to train them. Now, suppose there was noone to train them? I believe that is where we are at the present time. 

I am not proposing that everyone be highly skilled, nor even close to that. I am simply saying that with virtually no semi-skilled labor available, we may be in the position like our company found in northern India when it attempted to open a plant there. The low wages were really tempting, but the people first had to be taught to wear steel toed shoes. They had never worn shoes before. All they owned was a rice bowl, a white pajama-like garment, and a small piece of cloth for a sunscreen to sleep under. When told to press the green button, they asked, "What is green?" When a huge punch press thumped down the first time, they ran out of the factory in terror. 

I kid you not. Our engineering team returned after a year at the plant and spent a week being debriefed by management. The result was, our company dumped the operation at a loss. 

In recent years, a few operations have returned to the US for the same reasons, and because of inability to work within the differing cultures involved. One plant in Mexico was successful only after they learned to pay their workers DAILY, instead of weekly. If paid weekly, they stayed drunk until their money ran out. 

It is not a simple situation, and I don't think foreign vs domestic businesses can ever be characterized simply, except in very general terms. 

I am not a generalist thinker, and have plenty of trouble attempting to do so. I do believe that from what I have seen of the details of manufacturing from an engineering perspective, that rebuilding the US is going to be really long, slow process fraught with a plethora of unforeseen problems. At age 66, I don't plan to be part of that process, but to run my own small thing instead. I've had all the production headaches I want for one lifetime.


----------



## Tirediron

Fixing the lack of skills is not as easy as the scholars would have you believe, skills require aptitude, which are hard if not impossible to teach.


----------



## preponomics

Marcus said:


> Not to nitpick, but the Congressional Record has the number at 135 million in the 20th century who were killed by their own governments. This is more people than all the people killed in all the wars throughout history up to 1900.


I did quote the number based on all despotism, I agree with you on governments to domestic deaths 

Regardless the number is crazy high and I blame it all on various types of intervention foreign or domestic.


----------



## BillS

preponomics said:


> Respectfully, by this first trend you insinuate that imported dumb people is causing our economic woes. I disagree, how about "Economic Interventionism", which will also invoke those subsidies, borrowing, and taxation that you mentioned?


There's no way around the fact that importing Mexicans is bad economic policy for the government. That's nothing against them as people. It's the idea that uneducated people in low wage jobs who have big families take in more money in government help than they produce in taxes. The best economic deal for the US is to allow in Asian immigrants who have a lot of education and high incomes.

http://online.wsj.com/article/SB10001424052702303379204577474743811707050.html

Asians are the fastest-growing, most educated and highest-earning population in the U.S., according to a new report that paints the majority-immigrant group as a boon to an economy that has come to rely increasingly on skilled workers.

The number of Asians in the U.S. quadrupled between 1980 and 2010 to about 18 million, or 6% of the total population, according to "The Rise of Asian Americans," a study released Tuesday by the nonpartisan Pew Research Center. The bulk of Asians in the U.S. trace their roots to six countries: China, India, Japan, Korea, the Philippines and Vietnam.

As a group, Asians place more value than Americans overall on marriage, parenting, hard work and careers, according to the report. Irrespective of their country of origin, Asians overall believe that American parents are too soft on their children.

"They are the highly skilled workforce of the 21st century, but they also bring traditional values," said Paul Taylor, executive vice president of Pew and editor of the 215-page report, which combines a survey of 3,511 Asians in 50 states with analysis of economic and demographic data from the U.S. census.

Half of Asians have a college degree, compared with 30% for all Americans, and their median annual household income is $66,000, versus $49,000 for Americans as a whole.

Asians are more likely than the overall U.S. population to be married, or to live in a multigenerational household, and their children are more likely to be raised in a two-parent home, the report says.

"Asians exceed Americans on educational credentials and socioeconomic markers of success despite being predominantly first-generation immigrants," Mr. Taylor said. He added this sets Asians, three quarters of whom are foreign-born, apart from previous waves of immigrants"


----------



## techrun

So the American citizens with money, regardless of how they got it, who clothes their kids in Under Amour clothes will be paying for the lazy-ass American's and uneducated { dumb } American's kid's Under Amour shirts as well. 


Is that what I'm reading in this thread?:cheers:


----------



## preponomics

BillS said:


> There's no way around the fact that importing Mexicans is bad economic policy for the government. That's nothing against them as people. It's the idea that uneducated people in low wage jobs who have big families take in more money in government help than they produce in taxes. The best economic deal for the US is to allow in Asian immigrants who have a lot of education and high incomes.
> 
> http://online.wsj.com/article/SB10001424052702303379204577474743811707050.html
> 
> Asians are the fastest-growing, most educated and highest-earning population in the U.S., according to a new report that paints the majority-immigrant group as a boon to an economy that has come to rely increasingly on skilled workers.
> 
> The number of Asians in the U.S. quadrupled between 1980 and 2010 to about 18 million, or 6% of the total population, according to "The Rise of Asian Americans," a study released Tuesday by the nonpartisan Pew Research Center. The bulk of Asians in the U.S. trace their roots to six countries: China, India, Japan, Korea, the Philippines and Vietnam.
> 
> As a group, Asians place more value than Americans overall on marriage, parenting, hard work and careers, according to the report. Irrespective of their country of origin, Asians overall believe that American parents are too soft on their children.
> 
> "They are the highly skilled workforce of the 21st century, but they also bring traditional values," said Paul Taylor, executive vice president of Pew and editor of the 215-page report, which combines a survey of 3,511 Asians in 50 states with analysis of economic and demographic data from the U.S. census.
> 
> Half of Asians have a college degree, compared with 30% for all Americans, and their median annual household income is $66,000, versus $49,000 for Americans as a whole.
> 
> Asians are more likely than the overall U.S. population to be married, or to live in a multigenerational household, and their children are more likely to be raised in a two-parent home, the report says.
> 
> "Asians exceed Americans on educational credentials and socioeconomic markers of success despite being predominantly first-generation immigrants," Mr. Taylor said. He added this sets Asians, three quarters of whom are foreign-born, apart from previous waves of immigrants"


I understand your argument but keep in mind that you are basing facts upon a Keynesian and social welfare premise. Providing that socialism, social programs, and market interventionism is the norm, I completely understand your view and the quotation but that would be with our current economy and distorted lawful premise of fairness.

I am basing my statement that "if" we had a "non-interventionist" market place it would not matter where an immigrant comes from, because the market would demand performance for survival. There would be "no" social safety net, no health care, no unemployment, no free education, no individual free anything and because its a sink or swim "true free market" it will be based on performance. Upon no performance it hurts the individual. Upon much performance it helps the individual. The incentives and burden belong to the individual and that incentive is what made American great before we had this plethora of social welfare programs.

Corporatism, socialism and market interventionism use to be minimal but now we are no different that than the many nations that bottom out on interventionist policies.

Private rescue should be the "only" method for rescue in my opinion as socialism has never worked because it perverts the market. Then when its perverted, immigration becomes everyone's burden, what people eat becomes everyone problem, peoples health becomes everybody's problem, and what people need becomes everyone's problem, and it becomes a "subtraction" to our GDP, instead of immigration "adding" to our GDP.


----------



## Bobbb

preponomics said:


> I understand your argument but keep in mind that you are basing facts upon a Keynesian and social welfare premise. Providing that socialism, social programs, and market interventionism is the norm, I completely understand your view and the quotation but that would be with our current economy and distorted lawful premise of fairness.
> 
> I am basing my statement that "if" we had a "non-interventionist" market place it would not matter where an immigrant comes from, because the market would demand performance for survival.


First off, shouldn't your policy advice be designed to be resilient under many different circumstances rather than being able to work ONLY under your preferred Austrian program?

Does it harm your Austrian program to advocate a policy of NO Mexican immigration? No, it doesn't, now does it? So why not do that then when it would also not harm, and would in fact improve, the economy even under a Keynesian system? You do want was is best in terms of economic outputs, right? So here we have a Keynesian best and an Austrian neutral in terms of outcomes, so why fight against it?



> Then when its perverted, immigration becomes everyone's burden, what people eat becomes everyone problem, peoples health becomes everybody's problem, and what people need becomes everyone's problem, and it becomes a "subtraction" to our GDP, instead of immigration "adding" to our GDP.


As much as I want a free market system, I'd probably shoot myself in the head if I had to live under your Austrian system. I live in a culture, not an economy. If we adopted your system and then opened the borders, the economy would expand, there would be no social welfare, free voting would be abolished, and America would become a hell-hole as Somalians, Yemenis, and people from all over flocked in and completely ruined American culture. Screw that noise. Everything is not about the economy, the economy is anchored on a foundation of culture and that is what makes a nation.


----------



## preponomics

Tirediron said:


> Fixing the lack of skills is not as easy as the scholars would have you believe, skills require aptitude, which are hard if not impossible to teach.


In a top down environment I agree, but with free markets its the opposite effect

Free markets are the cure, as its a business doing the training directly

top down though I think your right, imposssible


----------



## machinist

I'm with Tirediron. There is a difference between the successful forces of the free market and *APTITUDE*. You can find interested candidates, motivated, even, but without individual aptitude, you ain't goin' anywere with skills.

Fer instance, I can't dance or shoot pool worth a hoot, because of a lack of coordination, but I can hold my own at many other things. I can't solve crossword puzzles, either, but I can draw anything in 3D from any viewpoint, and have exceptional spatial relationship thinking. Don't confuse motivation with physical abilities, nor with the proper thought patterns.

There are very basic differences in people that make utter fools of managers who think that all warm bodies are interchangeable. Try that on a basketball team, or a Mensa test. Oddly enough, and although it is politically incorrect these days, all men are NOT created equal. Anybody who thinks so didn't look around in the boys locker room.

Sound money and free markets are requirements of an enduring functional economy. They are NOT the end-all, be-all of everything.


----------



## preponomics

machinist said:


> I'm with Tirediron. There is a difference between the successful forces of the free market and *APTITUDE*. You can find interested candidates, motivated, even, but without individual aptitude, you ain't goin' anywere with skills.
> 
> Fer instance, I can't dance or shoot pool worth a hoot, because of a lack of coordination, but I can hold my own at many other things. I can't solve crossword puzzles, either, but I can draw anything in 3D from any viewpoint, and have exceptional spatial relationship thinking. Don't confuse motivation with physical abilities, nor with the proper thought patterns.
> 
> There are very basic differences in people that make utter fools of managers who think that all warm bodies are interchangeable. Try that on a basketball team, or a Mensa test. Oddly enough, and although it is politically incorrect these days, all men are NOT created equal. Anybody who thinks so didn't look around in the boys locker room.


I think you make a good point and will agree with you both, that possessed skills for one person is not necessarily possessed skills for another, just because the motivation is in place. I also agree with you that a free market doesn't give people skills, or even change individuals aptitude.

What what I do support is that instead of having 100 people having incentive to fail, due to social programs, you instead have 100 people having incentive to prosper, which inspires the individual to dig in their heels and focus on learning skills efficiently. This will of course bring fruition from potential and thus increase their aptitude. This is ten times more effective than the handed down socialized method. Thus the effect with true free markets, is that it will charge the 100 to have the right motivation to not be a detraction to the economy, but instead to do what it takes to be productive. This process enriches the established citizen the most, but will also bring wealth to the immigrant.

I also believe that skill, aptitude, and natural inclinations to succeed are diverse, and its not tied to a wealth class. Not that you or Tirediron have said that.



machinist said:


> Sound money and free markets are requirements of an enduring functional economy. They are NOT the end-all, be-all of everything.


Incredible statement that cant be said any better


----------



## machinist

We must have very different definitions of what aptitude means. For myself, it means an inborn ability to learn a given thing, and without that, all the training in the world has no effect whatsoever.

Yes, you can motivate people with opportunity. Yes, you can increase the number of interested people doing so, and thereby increase your odds of finding apt individuals. But for a given single individual, what they are is what they are. I will never be Magic Johnson. For one thing, I lack the height. I have trouble running without kicking my ankles bloody. I will never be an Albert Einstein, for gross lack of intelligence, although I have an interest in theoretical physics. I have learned to lay bricks, but I am abysmally slow at it because I lack coordination. Like, 12 bricks a DAY, instead of 1,200 for a pro.

Laying bricks is a SKILL that requires some certain basic APTITUDES before the SKILL can be developed. Some of the aptitudes for bricklaying are mental and some are physical. I have the mental aptitudes, but lack the physical ones.

My wife is face blind. That is, she cannot recognize faces. We have been married for 46 years and she STILL cannot pick me out of a crowd if I have changed clothing! You can believe that or you don't have to, but it is a hard cold fact, and no amount of motivation can change that. It is a brain dysfunction, now finally recongized by the medical establishment. You can try and train her to pick somebody out of a lineup, but it will never happen, because she lacks the APTITUDE for it. Ref: http://en.wikipedia.org/wiki/Prosopagnosia

Thankfully, we have a diverse enough population that we can find people with the necessary aptitudes for the various skills we need. But training will never make a me a Magic Johnson, no matter how motivated I may be by a free market and sound money.

Back on topic, I can see the US economic mess dragging on for as long as our inept (not APT) leaders can kick the can down the road. That will work right up until it doesn't. Then, we fall on our collective backsides. I think that then we will have a rather fast, hard crash when our money is no longer the accepted world trade currency. That has been creeping up on us for some time now, as other countries are distancing themselves from the dollar and trading among themselves in their own currencies.

Quote:
"An aptitude is a component of a competency to do a certain kind of work at a certain level, which can also be considered "talent". Aptitudes may be physical or mental. Aptitude is not knowledge, understanding, learned or acquired abilities (skills) or attitude. The innate nature of aptitude is in contrast to achievement, which represents knowledge or ability that is gained."

From: http://en.wikipedia.org/wiki/Aptitude


----------



## machinist

If the oil exporting countries decide to move away from the dollar, that would sink it, since that need for dollars to buy oil is mostly what props it up, as I understand it. Many think that is the real reason for the Gulf Wars, since Soddam Insane was offering to sell oil for other currencies and would not relent on the idea. 

I think we would go to war again on that issue, which is what REALLY worries me. Without defending the petrodollar, we would have a VERY fast crash, IMHO. So, it depends, as a good lawyer would say. But without the oil issue, we are getting there anyway, devaluing the dollar. Any other straw on this camel's back could easily break it. Like Yogi Berra said, it is hard to make predictions, especially about the future....


----------



## preponomics

machinist said:


> We must have very different definitions of what aptitude means. For myself, it means an inborn ability to learn a given thing, and without that, all the training in the world has no effect whatsoever.
> 
> Yes, you can motivate people with opportunity. Yes, you can increase the number of interested people doing so, and thereby increase your odds of finding apt individuals. But for a given single individual, what they are is what they are. I will never be Magic Johnson. For one thing, I lack the height. I have trouble running without kicking my ankles bloody. I will never be an Albert Einstein, for gross lack of intelligence, although I have an interest in theoretical physics. I have learned to lay bricks, but I am abysmally slow at it because I lack coordination. Like, 12 bricks a DAY, instead of 1,200 for a pro.
> 
> Laying bricks is a SKILL that requires some certain basic APTITUDES before the SKILL can be developed. Some of the aptitudes for bricklaying are mental and some are physical. I have the mental aptitudes, but lack the physical ones.
> 
> My wife is face blind. That is, she cannot recognize faces. We have been married for 46 years and she STILL cannot pick me out of a crowd if I have changed clothing! You can believe that or you don't have to, but it is a hard cold fact, and no amount of motivation can change that. It is a brain dysfunction, now finally recongized by the medical establishment. You can try and train her to pick somebody out of a lineup, but it will never happen, because she lacks the APTITUDE for it. Ref: http://en.wikipedia.org/wiki/Prosopagnosia
> 
> Thankfully, we have a diverse enough population that we can find people with the necessary aptitudes for the various skills we need. But training will never make a me a Magic Johnson, no matter how motivated I may be by a free market and sound money.


I can appreciate the study of aptitude being taken to a science, I am simply going just by the definition

Aptitude - Definition - NOUN 
1. - potential to acquire skill: a natural tendency to do something well, especially one that can be further developed

I think we will end up with the same resolve at the end. I agree that natural abilities, we are born with and are not necessarily taught successfully. Like you said, there are some things people can never be "trained" to do because its not in them to learn it, but they usually will have another skill that they do better than most at. As you pointed out we have diversity in our population to address the various skills we need. I contend that immigration also brings diversity and upon free market opportunity, the will learn quickly in diverse ways.

My point is simple - if you scoop up 100 Americans you will get a broad rage of diversity regarding aptitude, as you would in any other country. Although there are major cultural impacts and economic impacts that will stifle or flourish abilities. Aptitude exists in other counties too with their own broad rage of aptitudes that will simply flourish in a free market system due the broad rage of opportunity that a free market system offers.



machinist said:


> Back on topic, I can see the US economic mess dragging on for as long as our inept (not APT) leaders can kick the can down the road. That will work right up until it doesn't. Then, we fall on our collective backsides. I think that then we will have a rather fast, hard crash when our money is no longer the accepted world trade currency. That has been creeping up on us for some time now, as other countries are distancing themselves from the dollar and trading among themselves in their own currencies.


I think your right - its just a matter of time unless Americans wake up and elect people in office that will no longer support interventionism on the left or the right. I wish most people in our country was as aware of the economic calamity that awaits us as the people here in this forum.



machinist said:


> Quote:
> "An aptitude is a component of a competency to do a certain kind of work at a certain level, which can also be considered "talent". Aptitudes may be physical or mental. Aptitude is not knowledge, understanding, learned or acquired abilities (skills) or attitude. The innate nature of aptitude is in contrast to achievement, which represents knowledge or ability that is gained."
> 
> From: http://en.wikipedia.org/wiki/Aptitude


----------



## jsriley5

Just everyone keep in mind when we resett and start over we will have the opportunity to screw it all up again if we don't TEACH OUR CHILDREN and really hammer in this kind of stuff so that they will pass it down and we never forget the mistakes made THIS time. Of course I"m sure every new begginning starts that way but as a species we have the species equivalent of ADHD and soon move on to other new shiny and forget to drive history home. YOu hear it all the time about how much kids students of every age "I hated History, who cares what happened 300 years ago it over" perhaps that is why civilizations rise and fall about like clock work.


----------



## invision

jsriley5 said:


> Just everyone keep in mind when we resett and start over we will have the opportunity to screw it all up again if we don't TEACH OUR CHILDREN and really hammer in this kind of stuff so that they will pass it down and we never forget the mistakes made THIS time. Of course I"m sure every new begginning starts that way but as a species we have the species equivalent of ADHD and soon move on to other new shiny and forget to drive history home. YOu hear it all the time about how much kids students of every age "I hated History, who cares what happened 300 years ago it over" perhaps that is why civilizations rise and fall about like clock work.


It is absolutely a parents job to raise their own kid correctly... What is hard in today's society is that kids are exposed to so much at an early age. Two quick examples: my 8th grade 13 year old daughter has an ex boyfriend from this year, parents are EXTREMELY well off, he started smoking pot a month ago... Dropped out of sports, grades going down the drain, complete switch in attitude. She is torn up about it even though they are no longer "dating". Second, she has a mutual friend through her best friend who is a year older and in 9th grade... Guess what she thinks she might be? Yep, gave her virginity away 4 weeks ago to her boyfriend... Now as a parent these are very fortunate event in my eyes, cause 1 my step daughter opens up to me about this stuff, but 2 we can discuss consequences of her friends actions... She is smart, and I would love to shield her from all of this, but that is today's reality... Don't get me wrong, I hope the boy stops, and the girl isn't, but it is advantageous of me to calmly converse with her about how decisions made at such a young age can be both positive and negative. Yeah, the boy might think he is cool, but what is happening to him?


----------



## jsriley5

invision said:


> It is absolutely a parents job to raise their own kid correctly... What is hard in today's society is that kids are exposed to so much at an early age. Two quick examples: my 8th grade 13 year old daughter has an ex boyfriend from this year, parents are EXTREMELY well off, he started smoking pot a month ago... Dropped out of sports, grades going down the drain, complete switch in attitude. She is torn up about it even though they are no longer "dating". Second, she has a mutual friend through her best friend who is a year older and in 9th grade... Guess what she thinks she might be? Yep, gave her virginity away 4 weeks ago to her boyfriend... Now as a parent these are very fortunate event in my eyes, cause 1 my step daughter opens up to me about this stuff, but 2 we can discuss consequences of her friends actions... She is smart, and I would love to shield her from all of this, but that is today's reality... Don't get me wrong, I hope the boy stops, and the girl isn't, but it is advantageous of me to calmly converse with her about how decisions made at such a young age can be both positive and negative. Yeah, the boy might think he is cool, but what is happening to him?


I know now a days everyone wants to just mind their own business but have you considered telling the parents of those kids what is going on? I know it's their job to keep up with their kids but as part of a community we realy shouldn't help the kids keep secrects like these from their parents if indeed they are secrets at all. Just an opinion I would but then I used to be a cop and still have alot of butinski in me.


----------



## Bobbb

Parents overestimate the amount of influence they have on tween and teen children. By a lot.

How quickly many of us forget our time as kids. The way we acted around our parents was different in some fashion with how we acted in school which in turn was different from how we acted when alone amongst our friends and so on. To the extent that there are parental values playing a part here is has more to do with the peer networks that the parents ALLOW their children to form than it does with the values that the parents are teaching.

The same applies with jsriley5's points about values after a collapse - the kids may listen with one ear as their parents explain things but those values will set like concrete if they play out in their own teen peer networks. If all of the kids now have to go to work and learn to appreciate the value of a dollar and they talk about this amongst themselves and they experience the sacrifices, then the lessons will stick but when it's parents just talking about the need to be smart with tax money and the evils of redistribution then the lessons don't really stick. Look at how the older generations managed the country and look at their own experiences as young people. The freedom, the coddling, the validation, the feelings of specialness, back then were nothing compared to what kids today experience. If you get a pretty easy ride in your teen years, along all of your friends, then you come to expect that easy ride when you're an adult and if you're not getting it then you expect government to provide it to you.


----------



## invision

jsriley5 said:


> I know now a days everyone wants to just mind their own business but have you considered telling the parents of those kids what is going on? I know it's their job to keep up with their kids but as part of a community we realy shouldn't help the kids keep secrects like these from their parents if indeed they are secrets at all. Just an opinion I would but then I used to be a cop and still have alot of butinski in me.


If I had proof and not hearsay then yes I would... But not without proof...


----------



## oldasrocks

techrun said:


> So the American citizens with money, regardless of how they got it, who clothes their kids in Under Amour clothes will be paying for the lazy-ass American's and uneducated { dumb } American's kid's Under Amour shirts as well.
> 
> Is that what I'm reading in this thread?:cheers:


What do you mean "will be"? We're already doing that big time. $800,000,000. spent on social programs this yr alone. I bet that figure doesn't even include the overpaid Federal and state workers doling it out.


----------



## Immolatus

*Faith.*

I wasnt going to get involved in this thread but read most of it. I was reading this article on ZH and this comment sums up an answer to the OP.

There is nothing more certain that the absolute certainty of ones beliefs. That is not to say that the world's socioeconomic systems are not fragile and decomposing. But what exactly do you suppose is keeping them supported and in place, at least for the moment? 
If you said it was the Fed or the banksters or the various dependent-upon-unlimited-fiat-injections world governments I would argue that the ultimate strength of any complex system is the faith and belief the dependent participants have in that very same system. That faith comes from you and I and the guy down the street, not from the Fed, the governments nor the banksters. They do not create our faith and belief, but rather that are the recipients and abusers of our faith and belief.
So when we measure the fragility of any socioeconomic system we must actually measure the strength of those who support it. After several generations of conditioning and increasing dependence upon the very system you are now claiming will collapse quickly and completely, may I suggest that faith and belief, and ultimately the false hope that it engenders, will die a long and hard death. 
So while I will not argue that the death spasms with be sudden, violent and most certainly unpredictable, the faithful, facing the black abyss of self sufficiency and self reliance, will beg to be saved from themselves, thus supporting a doomed system long past it's perceived expiration date.
Long live denial.


----------



## Paltik

Bobbb said:


> And this brings me back full circle to Trend #1 - importing and growing our own poor people is a problem. As a society we should be trying to reduce the number of poor people. We can all agree on that. The debate focuses on how to achieve that goal. Liberals believe that socialism and the forced redistribution of wealth will achieve that goal and they're probably right but the cost of doing that is to make everyone equally poor and to rape people of their liberties. My solution is to reduce the number of poor people in our society and let other nations develop their own solutions. With a reduction in the number of poor people comes a lessened intensity for wealth redistribution and a lessened demand to rape people of their liberties.


It sounds to me like you're arguing for more abortion (keeping people out of liberty in the first place) in order to reduce rape (taking from people once they're in).

You talk of hiring illegal immigrations rather than paying higher wages to a citizen as "strike breaking." I call that creative definition. It just seems to be common sense to hire someone living 20 miles south of me (in Mexico) who will work harder for less than to hire someone living 20 miles north of me (in Orange County) or 1,000 miles away (some other US state) for more. By creating the concepts of "citizen" and "illegal immigrant," someone is playing some other meta game and the citizen, the illegal immigrant, and the business owner are all paying the price. The more the citizen and business owner can be made to buy into the re-defining of a neighbor as "illegal immigrant who shouldn't be hired," the easier it is for the elite to keep their power. The "citizen" is easy to convince, being a direct beneficiary (But at what indirect cost? Certainly his higher wages and those of his neighbors drive up the price of the goods they consume), the business owner, unless he is John Galt, will try to understand the rules to score as much as possible, and the illegal immigrant goes takes his chances for either the job, a share of the Take, or being sent back to Go.

You attribute unemployment of citizens and low wages to immigration rather than to laws regulating minimum wages, hours worked, benefits given, etc. I say once a company decides to evade the law (removing itself from 100% participation in the official economy to some hybrid level of participation), then in addition to paying people lower wages to work long hours without insurance, vacation pay, or retirement benefits, why not hire a non-citizen if he'll work harder?



Bobbb said:


> The goal of immigration should be to improve the situation for America and for America's citizens. The goal of improving the life of the immigrant shouldn't come at the expense of the welfare of Americans.


Having scolded preponomics for not anchoring his theories in the real world, what's this? For public officials, why isn't the goal of immigration to gain more political power? For the immigrant, why isn't the goal of immigration to gain wealth? For the business owner, why isn't the goal of immigration to keep costs down? If you want to plead "should be" for the goal of immigration, why can't preponomics plead "should be" for a free market?

My prediction is that Americans will increasingly ignore those who are shilling their version of how things should be, and instead will do what they want. We see this in the high percentage of eligible voters who just don't vote. We see this in the large number of people who use recreational drugs or who make a (tax-free) living in the drug industry. We see this in corporations who work to rig the game in their favor while spreading their assets around multiple jurisdictions so no law in one nation can destroy their wealth in others. We see this in people who enter our country illegally looking for work.

In fact, the rising popularity of "prepper" or "homesteading" sites reflects a recognition that the system is unsustainable. As formerly "productive members of society" drop out and start living self-sustainable lifestyles, their tax footprint diminishes and the end accelerates. So we have those living off welfare, those living off crime, those living off-grid, undocumented workers, multinationals taking things offshore, and people having fewer kids...all these things undermine the power of the State in nonviolent, counter-economic ways. America already has one of the world's highest incarceration rates; as the productive base continues to shrink, it will become more and more unsustainable to jail drug lords, tax evaders, smugglers, illegal immigrants, black marketers, etc.

Regarding your view that the elites are getting smarter while the masses are getting dumber--a lot of those involved in counter-economics can be pretty smart. Consider all the fading skills that a homesteader must learn, for example. Or consider how sharp a drug lord must be just to survive, let alone manage and grow his kingdom. Maybe the "masses" are dumbing down, but it's the counter-economy, not just the elites, who are breeding for the future.

Our nation is built on so many principles that are both noble and that clash. Majority rule, as in a democracy, has real problems when the rights of individuals (or minority groups) are subject to the permission of that majority. We rightly identified this conflict at one point and abolished slavery (regardless of how paying wages to former slaves might disrupt the economy), but the S really HTF when that happened and many thousands were killed. So we might have been slowly drifting to collapse now, but I think when it comes there will be much stuff hitting the fan.


----------



## Paltik

Marcus said:


> But I can also point out other examples where automation severely reduced low end jobs permanently. In agriculture, the motorized cotton picker eliminated the need for traveling crews to pick the bolls. Since the 1930s, the number of people employed as farmers has been greatly reduced primarily due to efficiencies of scale caused by motorized farming.
> 
> In the automotive industry, a considerable amount of welding is now done by robots. The old welders *may* have been retrained to another job or they may have left to weld in another industry. In the first case, they probably earned lower wages while in the second case, they depressed the job market for welders.


Surely you're not arguing that people in factories that produce tractors, harvesters, irrigation piping, etc. should be turned back into the fields to farm?

Certainly automation will disrupt economies, but it does not follow that the end sum is worse than before. People that left farms went into other kinds of work. Perhaps wages overall went down as the workforce absorbed the extra labor--but then, the efficiencies in farming meant food prices went down as well. If we can grasp the idea of a cost-of-living adjustment where one earns more because of inflation, why not one where people earn less because of deflation?

This sort of argument would also apply to buggy whips. With automated transportation, people stopped relying on horses so much and the buggy whip industry collapsed (along with buggy builders, hay farmers, horse breeders, horse trainers, groomsmen, stable boys, etc.) However, entire new industries arose--automobile manufacturers, cement mixers, drive-in restaurants, car washes, air compressors, oil drillers, etc.



> Automation leads to greater prosperity * for the owners* of the automation. Whether the owners choose to re-invest the additional profits back into the business is a decision based on economic and political factors.


What else will they do with their profits? Spend it on yachts? Then you'll have a bigger demand for yachts, so more work in shipyards, sail makers, marinas, ship crew, etc. Put it in the bank? Then the banks will have more money to loan to other industries, in effect transferring the re-investment of profits from the original industry to some other industry--not really taking those profits out of the economy at all. Unless the owners literally store the money or destroy it, in which case they really don't gain anything, efficiencies in one aspect of the market will have an impact much broader than any labor that is displaced.

Anyway, this gets to the root question--who owns the means of production (e.g. a factory)--the one who paid for it to be built? The ones who go there to work for wages? Those who loaned the money to the founder? It's all very well to tell business owners what they should do--but who end the end gets the final say about what is done?


----------



## Bobbb

Paltik said:


> It sounds to me like you're arguing for more abortion (keeping people out of liberty in the first place) in order to reduce rape (taking from people once they're in).


If you want to advance this argument then you're going to have to flesh it out in more detail because what might be clear in your own mind doesn't make much sense to me as you've written it.



> You talk of hiring illegal immigrations rather than paying higher wages to a citizen as "strike breaking." I call that creative definition. It just seems to be common sense to hire someone living 20 miles south of me (in Mexico) who will work harder for less than to hire someone living 20 miles north of me (in Orange County) or 1,000 miles away (some other US state) for more.


Not when you live in a social welfare state. That is utter madness. Importing that Mexican from just south of you now imposes all sorts of costs onto me. You benefit, the illegal benefits and I and others get stuck with the offloaded social costs that this illegal imposes on society.

When someone breaks into your house in San Diego, do you call the Tijuana police? The point of my question is to highlight that communities and rules exist and if you're in America then you should be playing within the sandbox of America and all of it's rules. You're pissing into the sand that we all play in when you take advantage of lower wage Mexican illegal employees and you offload their costs onto your fellow citizens. Don't piss in the sandbox.



> By creating the concepts of "citizen" and "illegal immigrant," someone is playing some other meta game and the citizen, the illegal immigrant, and the business owner are all paying the price. The more the citizen and business owner can be made to buy into the re-defining of a neighbor as "illegal immigrant who shouldn't be hired," the easier it is for the elite to keep their power.


Do you actually believe this tripe? This is Bizarro world logic. The elites are CLEARLY NOT in favor of immigration enforcement and deportations of illegal invaders. It is to the advantage of elites to have illegals in the country because it lowers their costs of doing business. Elite power is threatened when illegals are kept out of the nation because this strengthens the hand of the citizenry by creating labor scarcity and driving up wages and incomes at the expense of returns to capital.

You writing that black is white doesn't turn black into white.



> You attribute unemployment of citizens and low wages to immigration rather than to laws regulating minimum wages, hours worked, benefits given, etc. I say once a company decides to evade the law (removing itself from 100% participation in the official economy to some hybrid level of participation), then in addition to paying people lower wages to work long hours without insurance, vacation pay, or retirement benefits, why not hire a non-citizen if he'll work harder?


Because that company is anchored in a society. They use roads provided by government, they use a water system paid for by government or ratepayers, they use schools provided for by taxpayers, they use a secure society provided for by national defense, they use a stable business environment provided for by taxpayer funded police and courts, and so on. The freeloading business and the businessman who decides to go the freeloading route quite likely makes the nation poorer through his activities while simultaneously making himself richer at everyone's expense. The nation would be better off not subsidizing this leech and shutting him down and deporting the social welfare subsidized illegals that this businessman has hired.



> Having scolded preponomics for not anchoring his theories in the real world, what's this? For public officials, why isn't the goal of immigration to gain more political power? For the immigrant, why isn't the goal of immigration to gain wealth? For the business owner, why isn't the goal of immigration to keep costs down? If you want to plead "should be" for the goal of immigration, why can't preponomics plead "should be" for a free market?


If cost minimization was the goal sought by a businessman then why not set up shop in lawless Somalia? The problem is that the businessman likes to free ride - he likes the benefits that arise from American society but he doesn't want to play within the rules, carry his own weight and contribute to society, rather he wants to rip off society. This is an anchoring of a position in the real world. You conveniently omit any reference to the social welfare state within which we live. That illegal that you hire has kids and those kids go to American schools paid for by taxpayers. In your area that cost of educating one child in public school per year (2012 budget of $2 billion / 135,000 students) is over $14,000 per year. When you import that illegal worker are you paying for his kids to be educated? No, the rest of society is paying so that you can save a bit on the wages that you pay him.

So, in no way am I pleading "should be," what I'm doing is arguing "What is."


----------



## machinist

Automation will bring about a higher standard of living for all, but only if there is enough economic growth to expand consumption. 

That is a really important caveat, because I believe that we are facing a no-growth future due to the contstraints of resources. If that is true, then automation won't buy us anything, but will in fact cost more than it is worth in some cases, especially with innately low-volume items. 

Everything about our monetary system, personal overconsumption, and our political tendency to borrow to the max and let the grandkids pay for it, is based on perpetual growth. Perpetual anything does not exist, according to my physics profs. 

It is time to be thinking about how we can live on our income. :eyebulge: That'll put a crimp in the retail sales and political establishments. And, the longer we put off the day of reckoning about this, the better the chances of a really fast, hard crash. For example, like what is going on at present concerning the "fiscal cliff" (so-called). Congress fiddles while the economy burns. That's why my bet is on a long drift down to a final fast, hard crash. 500 MPH into a brick wall.


----------



## Padre

Bobbb said:


> Not when you live in a social welfare state. That is utter madness. Importing that Mexican from just south of you now imposes all sorts of costs onto me. You benefit, the illegal benefits and I and others get stuck with the offloaded social costs that this illegal imposes on society.


Why? Because we have stupid laws. As I have said before don't blame the stupid laws that our Representatives have passed on immigrants. There is no necessary relationship between immigrants and increased costs.



> When someone breaks into your house in San Diego, do you call the Tijuana police? The point of my question is to highlight that communities and rules exist and if you're in America then you should be playing within the sandbox of America and all of it's rules. You're pissing into the sand that we all play in when you take advantage of lower wage Mexican illegal employees and you offload their costs onto your fellow citizens. Don't piss in the sandbox.


No you call the local police which are, in most places, paid for by property taxes. So, in reality anyone who is not a property owner is actually not paying the bill, American and immigrant alike. If the locality funds itself off of sales taxes then even the immigrants pay.

The rules that our society has set up are KILLING our economy. So perhaps the problem is not the immigrants but the RULES. As an employer I can testify that stupid rules keep me from paying my people better. In MA, if you hire someone for more than 20hrs you must provide healthcare for them, and so I have several low skill workers, who are HARD WORKERS, who we hired after they lost their jobs. They need more money, but I can't give them the hours, or the money, because the cost of healthcare makes their hourly wage spike when they go full time. So the Government's RULES are encouraging me not to employee people full time. The same is true with immigrants, if I can afford to pay $X and the government requires me to pay $Y+lots of benefits, even if Y=X the immigrant get's hired. Every action has an equal and opposite reaction... and that includes stupid laws.



> Do you actually believe this tripe? This is Bizarro world logic. The elites are CLEARLY NOT in favor of immigration enforcement and deportations of illegal invaders. It is to the advantage of elites to have illegals in the country because it lowers their costs of doing business. Elite power is threatened when illegals are kept out of the nation because this strengthens the hand of the citizenry by creating labor scarcity and driving up wages and incomes at the expense of returns to capital.


No, the elites are CLEARLY NOT in favor of immigration enforcement and deportations because that would force us to confront the REALITY that all of our obscene pro-labor laws are killing the economy.



> Because that company is anchored in a society. They use roads provided by government, they use a water system paid for by government or ratepayers, they use schools provided for by taxpayers, they use a secure society provided for by national defense, they use a stable business environment provided for by taxpayer funded police and courts,


So your real argument is "you didn't build that"? :dunno:

Fact is the wealthiest pay the MOST taxes, and so in fact they did build that! Now if we had a big problem with the poor, WHO DON'T PAY TAXES, hiring illegals I would agree with you.... but as the top 1% pays 60% in taxes with the top 5% paying close to 80% I think they have earned the right to hire affordable workers so they can continue to pay for all those services that you are worried about them using.


----------



## Padre

Bobbb said:


> They use roads provided by government, they use a water system paid for by government or ratepayers, they use schools provided for by taxpayers, they use a secure society provided for by national defense, they use a stable business environment provided for by taxpayer funded police and courts, and so on. The freeloading business and the businessman who decides to go the freeloading route quite likely makes the nation poorer through his activities while simultaneously making himself richer at everyone's expense. The nation would be better off not subsidizing this leech and shutting him down and deporting the social welfare subsidized illegals that this businessman has hired.


So your real argument is "you didn't build that"?

Fact is the wealthiest pay the MOST taxes, and so in fact they did build that! Now if we had a big problem with the poor, WHO DON'T PAY TAXES, hiring illegals I would agree with you.... but as the top 1% pays 60% in taxes with the top 5% paying close to 80% I think they have earned the right to hire affordable workers so they can continue to pay for all those services that you are worried about them using.


----------



## Bobbb

Padre said:


> Why? Because we have stupid laws. As I have said before don't blame the stupid laws that our Representatives have passed on immigrants. There is no necessary relationship between immigrants and increased costs.


Yeah, so what? Paltik was mistakenly criticizing me for making a "should be" argument just like Preponomics was doing when in fact I was making a "What is" argument. Now you come along and chastise me for making a "What is" argument and you point to your own "Should be" rationale. Is there no escape for me from this endless loop?

We live in a social welfare state. Period. Full stop. I haven't engaged in other arguments with respect to immigrants because I don't need to, the economic argument is more than sufficient.

I also notice that you're still avoiding the direct question I asked of you, so please answer that rather than rudely ignoring it.

Point blank: In August of 2002 the labor force participation rate for men was 74.1% and in August of 2012 the rate had fallen to 70.4%, with an August drop-out of 348,000 people. *At a time when we have HUGE numbers of people who are officially categorized as unemployed and an even LARGER number who are discouraged workers who've dropped out of the labor force, why EXACTLY are you proposing that we add another 1,000,000 legal immigrants, most of whom are poor and poorly educated, to the labor force and to the welfare rolls?* Yeah, I get that this is a good deal for immigrants like your mother, but what exactly is the benefit to American citizens?​


> So your real argument is "you didn't build that"? :dunno:


No, the argument is that America is for Americans and the benefits should be directed primarily to Americans and that when America considers inviting someone from outside America into the fold the consideration should be what is good for America and not what is good for the immigrant, especially when what is good for the immigrant is bad for America.



> but as the top 1% pays 60% in taxes with the top 5% paying close to 80% I think they have earned the right to hire affordable workers so they can continue to pay for all those services that you are worried about them using.


Should the wealthy also be able to import their own Army and import their own foreign police and set up fiefdoms for themselves? If they can import workers and thus harm American society, then why not import their own police to do battle against American police if doing so favors their interests?


----------



## Marcus

Paltik said:


> Surely you're not arguing that people in factories that produce tractors, harvesters, irrigation piping, etc. should be turned back into the fields to farm?


Since you're choosing to make a straw man argument by failing to include the quoted material I was responding to and postulating a ridiculous POV I have never advocated, I wonder what is your point.


----------



## Padre

Bobbb said:


> Point blank: In August of 2002 the labor force participation rate for men was 74.1% and in August of 2012 the rate had fallen to 70.4%, with an August drop-out of 348,000 people. *At a time when we have HUGE numbers of people who are officially categorized as unemployed and an even LARGER number who are discouraged workers who've dropped out of the labor force, why EXACTLY are you proposing that we add another 1,000,000 legal immigrants, most of whom are poor and poorly educated, to the labor force and to the welfare rolls?* Yeah, I get that this is a good deal for immigrants like your mother, but what exactly is the benefit to American citizens?


No, one is arguing that, least of all ME, so I don't need to answer the question!

All I am saying is that the problem is not the immigrants but bad policies. I am not for illegal immigration because I think it is imprudent not to control the flow of people into your country, but I am very pro-immigration in general, because you and I wouldn't be here without immigration; or is it chief SittingBobb? 



> No, the argument is that America is for Americans and the benefits should be directed primarily to Americans and that when America considers inviting someone from outside America into the fold the consideration should be what is good for America and not what is good for the immigrant, especially when what is good for the immigrant is bad for America.


You still haven't proved that immigrants are bad for America, BTW, not sure who gets to decide what's good for America. Clearly they are good for some American businesses, and I would think the businesses, and the revenues they generate are "good for America."


----------



## Padre

Bobbb said:


> Yeah, so what? Paltik was mistakenly criticizing me for making a "should be" argument just like Preponomics was doing when in fact I was making a "What is" argument. Now you come along and chastise me for making a "What is" argument and you point to your own "Should be" rationale. Is there no escape for me from this endless loop?


Wait a minute, WHAT IS, is that we have STUPID LAWS and a black market in LABOR. If you are ok with WHAT IS, then GREAT. Leave it alone and lets end the argument.

You are attempting to place blame for our current predicament on WHAT IS and WHAT IS BLAMEWORTHY is BAD LAWS and not IMMIGRANTS. I am not making a "should be" argument except that what we SHOULD do is OBVIOUS if you recognize the correct problems.


----------



## Bobbb

Padre said:


> No, one is arguing that, least of all ME, so I don't need to answer the question!


*OK then, another point blank question: Do you favor an immediate cessation of all immigration until such time as the labor force participation rate reaches some pre-defined target?*



> I would note that you have changed your tune to specify ILLEGAL immigrants whereas at first you were talking about immigrants in general.


I haven't changed my tune. Follow the conversation. Paltik made specific references to importing people from Mexico, 20 miles south of him, so my response was tailored to his particular scenario.

You haven't caught me in any logical slip. My argument still applies to legal immigrants.



> because you and I wouldn't be here without immigration; or is it chief SittingBobb?


Let me try that argument on for size. None of us would be here if our far distant ancestors didn't engage in rape, therefore because rape was common in the dawn of civilization, it is fine and dandy today too.

Don't like that one? How about public duels over insults? Our ancestors were quick to murder when insulted.

Don't like that one? How about men having the unrestricted right to beat the living tar out of their wives whenever they felt the need.

Don't like that one? How about it being fine and dandy to get raging drunk and then drive home in your car.

Look, society isn't a suicide pact, where just because something was done in the past doesn't obligates America to grow to 7 billion in size and to let everyone in the world come over here. That's the implication of your position - if our ancestors immigrated, including Native Americans, then there can be no justification to ever stop immigration.



> Clearly they are good for some American businesses, and I would think the businesses, and the revenues they generate are "good for America."


Do you have children? If you do, do they earn any money from part-time work? If they contribute that money to your family are they now equal to the parents in terms of providing for the needs of your family? Don't sidestep the issue by invoking the children's roles in the family and them being equal members, just focus on the economic aspect of their contribution.

There is loads of research which demonstrates that low skill immigrants are a net cost to American society. We have enough trouble with our own, domestically grown, high school drop-outs being a burden on society, so why in Heaven's Name are we importing millions of poor and uneducated people from around the world, most of whom don't even speak English, unlike our HS drop-outs?


----------



## Meerkat

One Trick is rarring to go but now that the gates are open its too late.The Trojab Horse is now inside and the empire is lost.


----------



## Paltik

Bobbb said:


> If you want to advance this argument then you're going to have to flesh it out in more detail because what might be clear in your own mind doesn't make much sense to me as you've written it.


You said that the cost of socialism and forced redistribution of wealth is to make everyone equally poor and "rape" people of their liberties. Your solution was to enforce political boundaries, thereby reducing the increase in poor people in America, and presumably resulting in everyone being equally not as poor and perhaps only having their liberties molested. My point is that people are people, human rights are for humans, and so depriving some people of liberty by enforcing political boundaries is a kind of "abortion" in that they may not have access in the first place to liberties to be raped of them.

Whether it is good for a business to hire an immigrant or not, in my view, is up to that business. If the business chooses wisely, it will prosper; if he guesses wrong, it will suffer. You say "as a society" we should be trying to reduce the number of poor people; I find that artificial and contrived. Why "as a society" and not "as a business" or "as a family" or "as an individual" or "as humans?" If what we do "as a society" destroys my wealth as an individual, then why should I support my society? Patriotism?



> That is utter madness. Importing that Mexican from just south of you now imposes all sorts of costs onto me. You benefit, the illegal benefits and I and others get stuck with the offloaded social costs that this illegal imposes on society.


Why is it OK for society to impose costs on me, but not for me to impose costs on society? Why is it OK for other individuals ("society") to impose costs on me--telling me whom I may hire, how much I must pay them, what I may require of them, how much of my profits I may keep and how much I must give them, under what conditions I can sell my product, etc.--costs that may in fact drive me out of business--but I can't hire one illegal immigrant because it will impose a cost measured in a fraction of the costs I am paying on everyone else?



> When someone breaks into your house in San Diego, do you call the Tijuana police? The point of my question is to highlight that communities and rules exist and if you're in America then you should be playing within the sandbox of America and all of it's rules. You're pissing into the sand that we all play in when you take advantage of lower wage Mexican illegal employees and you offload their costs onto your fellow citizens. Don't piss in the sandbox.


You've already agreed the sandbox has been defiled. That's reality. Perhaps it "should" be pristine, but you and I are living in the real world, am I right?

If someone breaks into my house, I might shoot them, I might yell at them, I might call my neighbor (a Marine), or I might call my local police. Want to guess which of these choices is likely to be least helpful to me personally?



> Do you actually believe this tripe? This is Bizarro world logic. The elites are CLEARLY NOT in favor of immigration enforcement and deportations of illegal invaders. It is to the advantage of elites to have illegals in the country because it lowers their costs of doing business. Elite power is threatened when illegals are kept out of the nation because this strengthens the hand of the citizenry by creating labor scarcity and driving up wages and incomes at the expense of returns to capital.


Yes, I believe that re-defining a neighbor as "illegal immigrant who shouldn't be hired" makes it easier for politicians to keep their power. If I buy that narrative, I will give of my time and energies in support of leaders to "fight illegal immigration," I will legitimize the raping of employers of their liberty to choose their employees, and I will hire union workers whose dues will go to further support the elites.



> You writing that black is white doesn't turn black into white.


Okay...So back to the issue, let's establish what's black and what's white.



> Because that company is anchored in a society. They use roads provided by government, they use a water system paid for by government or ratepayers, they use schools provided for by taxpayers, they use a secure society provided for by national defense, they use a stable business environment provided for by taxpayer funded police and courts, and so on. The freeloading business and the businessman who decides to go the freeloading route quite likely makes the nation poorer through his activities while simultaneously making himself richer at everyone's expense. The nation would be better off not subsidizing this leech and shutting him down and deporting the social welfare subsidized illegals that this businessman has hired.


The reality is, our government subsidizes all kinds of people, right? If businesses "should" be responsible for paying fair wages, hiring only Americans, etc. in gratitude for all that society has done for them, what was wrong with saying illegal immigrants "should" be responsible for their own education and health costs in gratitude for all society does for them?

Of course, this isn't the direction either one of us is trying to go.

It seems to me you're saying "Government provides roads, water, schools, national defense, courts, etc. to people and so people do their business at the pleasure of the government that makes their lives possible." I see it just the opposite--People produce wealth and create governments to serve their common interests. But forming governments are not suicide pacts to destroy the people's interests!



> If cost minimization was the goal sought by a businessman then why not set up shop in lawless Somalia? The problem is that the businessman likes to free ride - he likes the benefits that arise from American society but he doesn't want to play within the rules, carry his own weight and contribute to society, rather he wants to rip off society. This is an anchoring of a position in the real world. You conveniently omit any reference to the social welfare state within which we live. That illegal that you hire has kids and those kids go to American schools paid for by taxpayers. In your area that cost of educating one child in public school per year (2012 budget of $2 billion / 135,000 students) is over $14,000 per year. When you import that illegal worker are you paying for his kids to be educated? No, the rest of society is paying so that you can save a bit on the wages that you pay him.
> 
> So, in no way am I pleading "should be," what I'm doing is arguing "What is."


Businessmen like to free ride. Illegal immigrants like to free ride. Christians like to free ride. Union bosses like to free ride. Politicians like to free ride. Yep, I agree that we're all people--and people tend to be greedy. Sellers want to charge more and buyers want to pay less. Your solution is to reduce the number of new free-riders entering the country, thus raising the standard of living of those who are already in, no? So tell me, IS it the case that there are no illegal immigrants, or SHOULD there just be no illegal immigrants?

It seems to me you want to say there SHOULD NOT be illegal immigration, while scoffing at those who say there SHOULD be free markets. I see special pleading.


----------



## Paltik

Marcus said:


> Since you're choosing to make a straw man argument by failing to include the quoted material I was responding to and postulating a ridiculous POV I have never advocated, I wonder what is your point.


You said there are cases where automation has permanently reduced low end jobs. You cited the motorized cotton picker, and said there are fewer farmers than in 1930 because of motorized farming. My point was that one should also consider the low-end jobs created in manufacturing, distributing, powering, maintaining, selling, and operating farm machinery, and also the benefit to other low-end job holders who could now buy cheaper food.


----------



## Bobbb

Paltik said:


> My point is that people are people, human rights are for humans, and so depriving some people of liberty by enforcing political boundaries is a kind of "abortion" in that they may not have access in the first place to liberties to be raped of them.


Are you seriously suggesting what it appears that you're suggesting, which is that there is a human right for a Mexican to come and set up a home in the US and bypass "political boundaries" which attempt to prohibit his transit across a border?



> Whether it is good for a business to hire an immigrant or not, in my view, is up to that business.


Not when we live in a social welfare state and there are externalities associated with the immigrant which get shoved onto the rest of society. Do street bums get a right to decide which bedroom in your home they are going to commandeer and then decide which hooker they're going to invite over? Hey, if you're not paying for the hooker, then what business do you have telling the street bum who invaded your home that he can't invite hookers to do their business in the same building which houses your family?



> Why is it OK for society to impose costs on me, but not for me to impose costs on society?


Society isn't preventing you from packing up and going to unregulated Somalia. Go. Please go.

You're a willing member of society and you agree to be bound by the collective decision making which arises from the political process, just like all of us. Your decisions to impose costs on society hasn't been developed by the same process, it's a unilateral imposition of costs, just like it would be a unilateral imposition on you if I showed up with a handgun and imposed my will on you and took your money.



> If someone breaks into my house, I might shoot them, I might yell at them, I might call my neighbor (a Marine), or I might call my local police. Want to guess which of these choices is likely to be least helpful to me personally?


What's with this "my house" crapola? I thought you were arguing that everyone has human rights to everyone else's property? America is the property of Americans.



> I will legitimize the raping of employers of their liberty to choose their employees


You can have all the liberty to hire illegal aliens by moving to Mexico, which the last I heard, is filled with Mexicans, or moving to Somalia, which last I head is filled with Somalians and pretty lawless too, and in both cases your exercise of freedom doesn't impose any costs on me or on other Americans. Go for it, dude.



> The reality is, our government subsidizes all kinds of people, right? If businesses "should" be responsible for paying fair wages, hiring only Americans, etc. in gratitude for all that society has done for them, what was wrong with saying illegal immigrants "should" be responsible for their own education and health costs in gratitude for all society does for them?


First off, illegal aliens are invaders, they are uninvited to this nation, and should immediately be arrested, jailed and/or deported. However, we don't do this, and so we have to deal with the toxicity that liberals and parasitic business owners thrust upon us and one of those toxic after effects is that society must pay for the schooling costs of illegal invader's children, as well as health care costs:

On the flip side, Parkland is also home to the second busiest maternity ward in the country with almost 16,000 new babies arriving each year. (That's almost 44 per day-every day)!

A recent patient survey indicated that *70 percent of the women who gave birth at Parkland in the first three months of 2006 were illegal immigrants. *That's 11,200 anchor babies born every year just in Dallas !!!

According to the article, the hospital spent $70.7 million delivering 15,938 babies in 2004 but managed to end up with almost $8 million dollars in surplus funding. Medicaid kicked in $34.5 million, Dallas County taxpayers kicked in $31.3 million and the feds tossed in another $9.5 million.

The average patient in Parkland in maternity wards is 25 years old, married and giving birth to her second child. She is also an illegal immigrant. By law, pregnant women cannot be denied medical care based on their immigration status or ability to pay. . . .

The Dallas Morning News article followed a Hispanic woman who was a patient at one of the clinics and pregnant with her third child-her previous two were also born at Parkland .* Her first two deliveries were free and the Mexican native was grateful because it would have cost $200 to have them in Mexico.* This time, the hospital wants her to pay $10 per visit and $100 for the delivery but she was unsure if she could come up with the money. Not that it matters, the hospital won't turn her away. (I wonder why they even bother asking at this point.)​


> But forming governments are not suicide pacts to destroy the people's interests!


But no one is destroying your interests. Somalia beckons. They don't have government at all. Look, all of your arguments presuppose that a welfare state doesn't exist. News for you - it does. There are millions of unemployed Americans who you can hire for your business in America. If you want to hire a Mexican, then go set up shop in Mexico and when you do so the externalities that you create don't fall on me and others who have to pay to subsidize yet another person who can't pull their own weight in the world's most expensive cost of living country.



> It seems to me you want to say there SHOULD NOT be illegal immigration, while scoffing at those who say there SHOULD be free markets. I see special pleading.


There are immigration laws and illegal invaders are violating those laws. There are no laws mandating a free market.

I can bypass the "should be" angle you trot on illegal invaders, very clever gambit btw, by simply pointing to the already existing laws and declaring that they be enforced and this rids us of the people who've invaded our collective property, just like you, as a homeowner, could call for the law to come and arrest the criminal gang who've invaded your home. Are you going to try to argue that home invasion gangs exist and therefore simply because of their existence they shouldn't be dealt with or eradicated?


----------



## BillS

preponomics said:


> I* understand your argument but keep in mind that you are basing facts upon a Keynesian and social welfare premise.* P
> I


Totally untrue. Given how you were distorting what I said beyond recognition I see no basis for a rational discussion. I stopped reading after the first few sentences. I can only imagine the relationship difficulties you must have in real life.


----------



## BillS

jsriley5 said:


> Just everyone keep in mind when we resett and start over we will have the opportunity to screw it all up again if we don't TEACH OUR CHILDREN and really hammer in this kind of stuff so that they will pass it down and we never forget the mistakes made THIS time. Of course I"m sure every new begginning starts that way but as a species we have the species equivalent of ADHD and soon move on to other new shiny and forget to drive history home. YOu hear it all the time about how much kids students of every age "I hated History, who cares what happened 300 years ago it over" perhaps that is why civilizations rise and fall about like clock work.


The problem is that the schools and colleges have been successfully indoctrinating our children. That's the advantage liberals have.


----------



## Marcus

Paltik said:


> You said there are cases where automation has permanently reduced low end jobs.


That is correct.



> You cited the motorized cotton picker, and said there are fewer farmers than in 1930 because of motorized farming.


That is also correct.



> My point was that one should also consider the low-end jobs created in manufacturing, distributing, powering, maintaining, selling, and operating farm machinery, and also the benefit to other low-end job holders who could now buy cheaper food.


There are very few low end jobs in manufacturing farm equipment. A factory worker makes $40-50K/ year not including overtime. That's not a low end job. A low end job is minimum wage or there abouts.

Additionally, operating farm equipment is very similar to operating construction equipment in that it requires a skillful touch. Sure, you can hire someone real cheap, but who wants to pay a combine operator next to nothing after you've invested several hundred thousand in the equipment? Especially when inattention can easily tear up a cutter bar and idle your investment. So you either pay for a skilled operator or you pay for your foolishness through lower productivity of your equipment.

The point you're missing is that there are fewer and fewer workers throughout agribusiness. And most of those losses have been at the low end as automation has mutiplied worker efficiencies. The remaining jobs require more education and/or skillsets and thus are not low end jobs.


----------



## preponomics

BillS said:


> Totally untrue. Given how you were distorting what I said beyond recognition I see no basis for a rational discussion. I stopped reading after the first few sentences.


Its true - In 1913 we a passed the federal reserve act that empowered a central bank and a Keynesian premise to manipulate the money supply and pervert interest rates that leads to price fixing and devaluing the individuals assets in business. It props up advantaged corporatists and puts the honest over regulated capitalist at a disadvantage.

Convolution and economic chaos contributed by John Maynard Keynes (a socialist) establishes an economic premise that governments love, because its a masterful way to transfer money from the individual. Nixon was then successful with his administration to break us off gold completely from our money. Now the perversion can be unlimited and thus predictable to unsustainable economic calamity. This is becoming a repeated road to economic destruction all over the world.

Only if Americans demand a free market and individual liberty again and vote for "real" proponents of capitalism (not corporatism or fairness) will our economic future have a chance


----------



## preponomics

Marcus said:


> The point you're missing is that there are fewer and fewer workers throughout agribusiness. And most of those losses have been at the low end as automation has mutiplied worker efficiencies. The remaining jobs require more education and/or skillsets and thus are not low end jobs.


Your basing an example on the unseen premise of interventionism that is failed to be mentioned. I can agree with your assessment that with a pulverized market place from interventionists, that automation can effect jobs just like immigration can, as its the goal of interventionists to penalize companies unto fairness. During the Great depression the perversions of price fixing and crop destruction also affected jobs. So from a stand point of working from a perverted premise the market place will not act as it should if powers are manipulating it, thus your point can make sense. However if the market place is left alone automation will do nothing but breed more prosperity unto more success as Paltik mentioned in terms of purchasing strategically in a business.

Business prosperity with honest capitalism creates more jobs, not fewer, but with a controlled market, jobs will suffer on almost every side.


----------



## machinist

Don't confuse "Market controls", (which are a very different animal) with market saturation. The US consumer is so overloaded with "consumer goods" and the debt those purchases created that there is a much smaller market now. Housing is a fine example, being overbuilt on speculation to the point that we have a bunch of 'em sitting empty. A chart on debt saturation here: http://www.zerohedge.com/news/scariest-chart-ever

A market requires both a desire to purchase and the ABILITY to do so. The US consumer is typically broke and in debt. It doesn't matter how much they might WANT to buy something, they have used up their credit limit, just like the government. (The Federal Reserve banks are now purchasing most of the new govt debt. I can find a link for that on Zerohedge if anyone is interested.) Found it: http://www.zerohedge.com/news/2012-12-03/time-bernanke-reevaluate-his-sworn-testimony-congress

So, our present malaise is far more due to a credit saturated consumer with no inability to buy, than it ever was to any sort of "interventionism", or any other "ism".

I don't like market controls either. Like economic "stimulus", they distort the whole picture. Supply and demand are sufficient to make the marketplace function.

But, I know better than to believe your assertion that automation only breeds prosperity. IF, and that is a BIG "IF", you have a market external to your country, such as China's exporting model, then you can automate and find a place to sell your goods. For a while. It will work, right up until it doesn't, because even an external market will get saturated. There is a limit to how many orange plastic Halloween Punkins the "market" will buy, no matter who produced them, how cheap they are, nor whether the sale thereof is regulated, nor if the market has been "intervened".

All marketers know that. This is the reason for shoddy quality goods. By making things of low durability, they will get thrown away and the demand is back for more.

I have spent about 40 years involved in automation in various industries, and can say with assurance that there is one and ONLY ONE purpose for it. That is to *reduce cost by reducing labor content *in the product. The expenditure of capital for automating MUST be justified to the stockholders by reduced labor costs in the future. That means fewer jobs. Period. There simply is no arguing with that simple fact.

Quote: "The term automation, inspired by the earlier word automatic (coming from automaton), was not widely used before 1947, when General Motors established the automation department. At that time automation technologies were electrical, mechanical, hydraulic and pneumatic. Between 1957 and 1964 factory output nearly doubled while the number of blue collar workers started to decline."
From: http://en.wikipedia.org/wiki/Automation

I am personally well acquainted with the GM automation program, having worked in it for 13+ years, and thus, how they justify expenditure of capital, like all other manufacturing companies.

And from the same article, quote: 
"Based on a formula by Gilles Saint-Paul, an economist at Toulouse 1 University, the demand for unskilled human capital declines at a slower rate than the demand for skilled human capital increases.[17] In the long run and for society as a whole it has led to cheaper products, lower average work hours, and new industries forming (I.e, robotics industries, computer industries, design industries). These new industries provide many high salary skill based jobs to the economy."

If those higher skilled/higher paid jobs did not equal fewer TOTAL jobs and less TOTAL labor expense, then business management would be utter and complete fools to spend money on automation.

Marcus was right.

Any quest to deal with interventionism needs to begin in the financial industry.


----------



## machinist

*Current Limits on Prosperity*

A lot of economic ideas that were true in the past won't work in the future.

We are hitting the limits of natural resources, cost and availablitiity of exploitable fossil energy, and food production capacity. As energy becomes more dear, so will food production capability decline. As resources become more scarce and expensive, the cost of manufactured goods will soar, and we all become poorer.

Most economic models of the past ignore those limitations and thus will not be relevant in the future.

Fiat money is probably the prime example of being predicated on infinite growth, which is utterly impossible in a finite world.

We need to be turning our attention on how to live in a world constrained by limits, not trying to increase our consumption of resources. Our attention will have to be aimed at improved efficiencies in order to even maintain our present day standard of living, let alone increasing "prosperity".

That concept makes most current economic discussions irrelevant to the real problems, and will dictate our level of "prosperity", whether we recognize that fact, or not.


----------



## preponomics

machinist said:


> Don't confuse "Market controls", (which are a very different animal) with market saturation.


I think to differentiate market controls from market saturation is definitely worthy of distinction and will agree with you that they are indeed two different things. However when allocating cause for the saturation; the controls are that cause most of the time in a managed economy. I believe in a left alone economy.

Natural saturation in the market place is normal throughout economic history, but a free market will counter respond to it with production behaviors that will sure-up what is actually in demand. If there is no demand then there will be no production drawn to the saturation, as it will not make money. The new demand will naturally guide the new production though competition and that production in a free market will shift to new prosperity greater than before, if left alone.



machinist said:


> The US consumer is so overloaded with "consumer goods" and the debt those purchases created that there is a much smaller market now. Housing is a fine example, being overbuilt on speculation to the point that we have a bunch of 'em sitting empty. A chart on debt saturation here: http://www.zerohedge.com/news/scariest-chart-ever


I am with you, as here in the US, we are a consumption country riddled with consumer and business debt. I also think our gov debt to GDP is starting to spiral out of control. But to make my point the housing bubble (sub prime) that you pointed out happened because of interventionism, which created a distortion in the market place. Unlimited cheap easy credit for junk mortgage backed securities mixed with unlimited backing of fred/fan, caused an unnatural supply of houses to consumers with no risk to the lender and too easy for the purchaser. To make it worse the fed has consistently frozen interest rates near zero for mid level banks. This is not a free market left to honest banking and natural forces of supply and demand. It was perverted, thus we have a lot of empty houses.



machinist said:


> A market requires both a desire to purchase and the ABILITY to do so. The US consumer is typically broke and in debt. It doesn't matter how much they might WANT to buy something, they have used up their credit limit, just like the government. (The Federal Reserve banks are now purchasing most of the new govt debt. I can find a link for that on Zerohedge if anyone is interested.) Found it: http://www.zerohedge.com/news/2012-12-03/time-bernanke-reevaluate-his-sworn-testimony-congress


I so agree with this as our country is so broke its pathetic and the fed is an unlimited credit card.



machinist said:


> So, our present malaise is far more due to a credit saturated consumer with no inability to buy, than it ever was to any sort of "interventionism", or any other "ism".


I provide a cheezy example here for the purpose of a point, not to attempt to educate you about the sub-prime crises, as I can tell by your contributions that you are astute (in a good way) 

Hypothetically if a person comes up to me and says, "Can I borrow a thousand dollars?", it would be prudent of me to ensure they could pay it back with interest and it would also be prudent for me to secure it with collateral, or I might lose my investment. However if a second source says to me, loan the money to that person without collateral and trust them completely, as I will insure you with Americas money in the contract. Now my loan has no risk whatsoever and am now able to secure my loan investment risk free at someone else expense.

In fact I will try to loan out as much of this "insured money" as I can as its a guaranteed home-run every time. Hey no job, that's ok. No collateral, that's OK too. No down payment, that's fine as well. Oh and if you don't pay a thing someone else will. I would be inclined to make very poor choices due to an intervening authority that has no right to insure my loans at Americas expense.

This is what happened on a massive scale. The only problem is that the guarantor, which is the American people, are broke. The solution? print it! Upon the deflation of assets, bailouts upon bailouts! Thus your link confirms the financial fiasco we are in. This is the some of the most paramount interventionism in world economic history!

IF the market had been "left alone" then banks, sellers and buyers would have acted normally and the supply would have reflected the natural demand. But with our Keynesian premise at the helm, the "supply" distorted the demand with cheap easy credit and then bailed them out with a broke countries printed money.



machinist said:


> I don't like market controls either. Like economic "stimulus", they distort the whole picture. Supply and demand are sufficient to make the marketplace function.


we so agree here for sure



machinist said:


> But, I know better than to believe your assertion that automation only breeds prosperity. IF, and that is a BIG "IF", you have a market external to your country, such as China's exporting model, then you can automate and find a place to sell your goods. For a while. It will work, right up until it doesn't, because even an external market will get saturated. There is a limit to how many orange plastic Halloween Punkins the "market" will buy, no matter who produced them, how cheap they are, nor whether the sale thereof is regulated, nor if the market has been "intervened".
> 
> All marketers know that. This is the reason for shoddy quality goods. By making things of low durability, they will get thrown away and the demand is back for more.


I agree that manufacturing is strategic for creating future demand, but if the market place is left alone, then each manufacturer will simply succeed or fail based on the tangible demand. Business must then competitively change or financially die. In a propped up market there will be "too many" orange plastic pumpkins or "too few" based on where interventionism decides to rout purchase behavior.

Automation typically increases productivity and if left alone will prosper at the macro-economic level more often than not, but will agree that locally jobs can be effected dramatically.



machinist said:


> I have spent about 40 years involved in automation in various industries, and can say with assurance that there is one and ONLY ONE purpose for it. That is to *reduce cost by reducing labor content *in the product. The expenditure of capital for automating MUST be justified to the stockholders by reduced labor costs in the future. That means fewer jobs. Period. There simply is no arguing with that simple fact.
> 
> Quote: "The term automation, inspired by the earlier word automatic (coming from automaton), was not widely used before 1947, when General Motors established the automation department. At that time automation technologies were electrical, mechanical, hydraulic and pneumatic. Between 1957 and 1964 factory output nearly doubled while the number of blue collar workers started to decline."
> From: http://en.wikipedia.org/wiki/Automation


On the micro-economic level I agree with you but not on the macro-economic level if you have real free markets. Over all the GDP will rise if the brass and holders make good strategic decisions going forward. Typically a successful transition with a strong company will also not let go of good resources and will/should train horizontally or vertically going forward. However if they are cutting costs then there is a possibility that they are no longer competitive or they are being punished with intervention.



machinist said:


> I am personally well acquainted with the GM automation program, having worked in it for 13+ years, and thus, how they justify expenditure of capital, like all other manufacturing companies.


I know we are debating here but I do deeply respect your experience with this industry and believe I can resonate with your perspective although we have differences. I also appreciate your strategic points of debate



machinist said:


> And from the same article, quote:
> "Based on a formula by Gilles Saint-Paul, an economist at Toulouse 1 University, the demand for unskilled human capital declines at a slower rate than the demand for skilled human capital increases.[17] In the long run and for society as a whole it has led to cheaper products, lower average work hours, and new industries forming (I.e, robotics industries, computer industries, design industries). These new industries provide many high salary skill based jobs to the economy."
> 
> If those higher skilled/higher paid jobs did not equal fewer TOTAL jobs and less TOTAL labor expense, then business management would be utter and complete fools to spend money on automation.


Gilles Saint-Paul was an economic Paternalist and believed in government intervention on many levels (nanny state). His premise was also written during a time where many intervention-styled economist projected the end of the labor force almost altogether within a few years, but the opposite happened. Again on the micro-economic level there is a case for companies to decrease the work force but overall the GDP typically goes up when capitalism is left alone in a free market economy. Companies succeed better and the jobs increase, not decrease. The intervention upon companies is what causes the decline in the labor force most of the time.



machinist said:


> Any quest to deal with interventionism needs to begin in the financial industry.


To me interventionism is a form of economic perversion that should be disallowed by a vigilant society, as each individual will see them coming a mile away, who will vote in politicians at the "little s" state level, who will use nullification and the constitution to remove them peacefully, and lawfully from our economy at the federal level. 
I know good luck with that


----------



## machinist

Your ideas, at least what I am able to fathom, sound a lot like what I heard from some GM managers back in the day. I left there and started my own business, which I retired from recently. GM, as we know, only exists at the behest of the govt., having gone bankrupt. 


I rest my case on whose ideas work in the real world.


----------



## preponomics

machinist said:


> Your ideas, at least what I am able to fathom, sound a lot like what I heard from some GM managers back in the day. I left there and started my own business, which I retired from recently. GM, as we know, only exists at the behest of the govt., having gone bankrupt.
> 
> I rest my case on whose ideas work in the real world.


Machinist, just want to convey, I respect your position, though we see this point differently.

I am definitely not a corporate manager of any kind as I detest advantaged corporatism. I love honest capitalism though and will vote for it every chance I get.

Unfortunately the Austrian school has never been adopted completely by any country in its fullness. A set of principles exercised partially in some economic historical accounts where market forces could naturally be observed without interventionist trying to distort it.

In my opinion our country (US) in the latter half of the 1800s actually did exercise some of the Austrian principles of non-interventionism and free markets in a large way. There was no income tax, no central bank, and our money was backed in gold/silver. This led to the greatest economic result in world history, in spite of some advantaged corporatism and major transgressions concerning slavery.

I am only trying to share these very sound ideas which have not been used in our country in over a hundred years on a fairly pure level.


----------



## machinist

preponomics,

Said, Quote: "I agree that manufacturing is strategic for creating future demand..."

I did not say that. In fact, I said the opposite. Manufacturing can only come about when demand already exists, be it rational demand for necessities, or demand created by clever marketers and easy credit. Note that easy credit IS interventionism, but clever marketing is NOT interventionism. 

"Build it and they will come" is a poor investment strategy, as China found out before they had a clue what "demand" was all about, being used to their central government dictating everything. 

I am reminded of an article referring to the early 1970's, IIRC, when an American businessman type was invited to a prospective import deal and proudly told by a Chinese economic minister that, "We can make 5 million wrenches!" The American asked what was their market demand? The Chinese guy repeated, "We can make 5 million wrenches!" Unimpressed, he asked to see some of them. They were of poor quality cast iron, not forged like a good tool, and besides, they were Metric, which was not popular in the US back then. He told them that and went home. Some months later, this economic minister and an assistant came to the US guy's office and asked, "What is this market demand, and how is it to be found?" The Chinese went back somewhat wiser and did their homework, finally penetrating the US markets with grand success. They had learned that "Make it and they will buy" is BS. 

I see a lot of things the way you do. I agree that Austrian economics is the best answer we know of today, and also that it has not been truly implemented anywhere. TPTB get their fingers in the pie too often to meddle, trying to further their own ends. Austrian economics AND a free market would be a very good thing, but it is not a panacea. 

I do not see that interventionism is the reason for all bad things economic. I do agree that interventionism is a major fault in current affairs, but it is not the ONLY fault, which you seem to deny. That is the root of our disagreement, as I see it. There are many things wrong out there now. The world is not simple. One pill will not cure everything.


----------



## machinist

Quote:
"I would be inclined to make very poor choices due to an intervening authority that has no right to insure my loans at Americas expense."

Cart before the horse here. The mortgage loan guarantees were not made ahead of the loans being made, but in fact were made AFTERWARD to keep the system from crashing. In fact, the loans were made simply on a FRAUDULENT basis by entities that knew they could sell off those hot potatoes before THEY got burned by them. There were ZERO guarantees at that point. Only when the loans went sour did TPTB step in and threaten Congress to give the banksters a bailout lest the whole country fall on it's butt. 

So, interventionism did not CAUSE this problem. Intervention was a REACTION to the problem.
____________

Would you care to elaborate on what you mean by advantaged corporatism? If you mean something on the order of monopolistic tendencies, or other unfair advantages, I would tend to agree with you. That is, short of something that borders on Socialism or centrally controlled economic systems. I don't like those who hammer the marketplace with unfair advantages, but I do endorse companies who profit because they have a better mousetrap, no matter if they are a corporation, a parnership, or any other style organization. BP, for example, I think has too much clout, along with oil conglomerates and probably Microsoft. But I like to see someone succeed based on merit and good management.
_____________

Quote:
"Gilles Saint-Paul was an economic Paternalist and believed in government intervention on many levels (nanny state). His premise was also written during a time where many intervention-styled economist projected the end of the labor force almost altogether within a few years, but the opposite happened. Again on the micro-economic level there is a case for companies to decrease the work force but overall the GDP typically goes up when capitalism is left alone in a free market economy. Companies succeed better and the jobs increase, not decrease. The intervention upon companies is what causes the decline in the labor force most of the time."

Yeah, jobs increased all right, mostly minmum wage jobs in fast food. The manufacturing jobs that paid well have gone to where the labor is even cheaper than in a highly automated US factory. Jobs in the automated industries declined on a PER UNIT of PRODUCTION basis. Which is what I said to start with. The displaced factory workers got lower paying jobs flipping burgers or such, if they got one at all. 

What Gilles Saint-Paul believed or espoused is not important to the debate, even if it is an interesting sidelight. What counts is what happened to the US economy, and the fact is we now have a lot less jobs in the best categories. And the remaining jobs pay a lot less in real terms than factory jobs of yore. Yeah, I know that is a broad brush and that you can pick at the details of it, but the overall picture is that the US is headed for resembling the society in Mexico, with a broad wage disparity beween haves and have-nots, and a gutted middle class. Again, that is due to a whole host of reasons and concurrent events, but I find it ironic that Gilles' philosophy fell directly on it's butt, even while prediciting what became the ultimate demise of it.

For me, the bottom line is the ultimate result of our complex economic system being in its' present state of decline. A few in the US have gotten very rich, while the vast majority have gotten a lot poorer. So, would a lack of interventionism have prevented this? No. Fiat money will eventually reach its' intrinsic value, that of the paper it is printed on, per some obscure Frenchman I can't recall at the moment. Fiat currency is the best tool I know of to separate the masses from their wealth, and the most isidious.

If you said that fractional reserve banking and fiat currency were at the root of most of our problems I would agree. But that is still not all that is wrong.

And all the things that ARE wrong are sending us down a slippery slope toward that final cliff, and it is not the Fiscal Cliff in the news today, but the final repudiation of the US dollar by other countries.


----------



## PackerBacker

Machinist,

Not being critical here just wondering. Do you know how to use the "quote" button?

I'm interested in what you have to say but it's extremely difficult to follow your posts in your format.


----------



## machinist

No. I'll work on it. All I've ever gotten with the quote button was a whole post, which is a bigger problem when I want to refer to a given statement. It takes all my attention to get the reasoning right in what I'm trying to say. Until I can get more proficient with forum tools, it's a problem for me.

My apologies for being hard to read.


----------



## Bobbb

Machinist, to use the quote function in a series of sliced up quotes all you need do is enclose the word QUOTE with SQUARE BRACKETS and then copy in your text and close the text with a BACKSLASH followed by the word QUOTE and bracket this with an open and closed SQUARE BRACKET.


----------



## PackerBacker

machinist said:


> No. I'll work on it. All I've ever gotten with the quote button was a whole post, which is a bigger problem when I want to refer to a given statement. It takes all my attention to get the reasoning right in what I'm trying to say. Until I can get more proficient with forum tools, it's a problem for me.
> 
> My apologies for being hard to read.


No apologies needed.

I find it easiest to hit the quote button then delete the unwanted portion.

Otherwise if copy and paste works better for you you can paste it, highlight it again, then hit the little quote button just above this box (4th one from the right) then it turns out like this:



> No. I'll work on it


----------



## preponomics

machinist said:


> preponomics,
> Said, Quote: "I agree that manufacturing is strategic for creating future demand..."
> 
> I did not say that. In fact, I said the opposite. Manufacturing can only come about when demand already exists, be it rational demand for necessities, or demand created by clever marketers and easy credit. Note that easy credit IS interventionism, but clever marketing is NOT interventionism.
> 
> "Build it and they will come" is a poor investment strategy, as China found out before they had a clue what "demand" was all about, being used to their central government dictating everything.


My apologies machinest, I did not articulate this point very well. Previously you mentioned this sentence.


machinist said:


> All marketers know that. This is the reason for shoddy quality goods. By making things of low durability, they will get thrown away and the demand is back for more.


I was simply agreeing with you that things can be strategically made cheap in order for them to wear out so that a "future demand" can be obtained. A repeated disposable demand. It was not really a central point to my argument but rather my agreement with you that this was true from your statement about cheap crap.



machinist said:


> I am reminded of an article referring to the early 1970's, IIRC, when an American businessman type was invited to a prospective import deal and proudly told by a Chinese economic minister that, "We can make 5 million wrenches!" The American asked what was their market demand? The Chinese guy repeated, "We can make 5 million wrenches!" Unimpressed, he asked to see some of them. They were of poor quality cast iron, not forged like a good tool, and besides, they were Metric, which was not popular in the US back then. He told them that and went home. Some months later, this economic minister and an assistant came to the US guy's office and asked, "What is this market demand, and how is it to be found?" The Chinese went back somewhat wiser and did their homework, finally penetrating the US markets with grand success. They had learned that "Make it and they will buy" is BS.


Your point is eloquently made and I agree with it



machinist said:


> I see a lot of things the way you do. I agree that Austrian economics is the best answer we know of today, and also that it has not been truly implemented anywhere. TPTB get their fingers in the pie too often to meddle, trying to further their own ends. Austrian economics AND a free market would be a very good thing, but it is not a panacea.


I think your right that free markets are not a panacea, Its a good point as the free market is very flawed and imperfect but in spite of these imperfections its the proper premise for sound money and exchange. With it you have individual scrupulous activity as a minor part of the economy, without it you have scrupulous activity from despots that can run a nation into poverty, oppression and tyranny.

I argue it so passionately because its the proper foundation for individual exchange. Individual economic independence is one of the cornerstones for individual liberty. That said, much illegal and tainted activity can happen within in it, but healthy economy will overcome it, if its left alone, unaffected by fairness from the interventionist.



machinist said:


> I do not see that interventionism is the reason for all bad things economic. I do agree that interventionism is a major fault in current affairs, but it is not the ONLY fault, which you seem to deny. That is the root of our disagreement, as I see it. There are many things wrong out there now. The world is not simple. One pill will not cure everything.


I see several things as an antagonist to a prospering free country that has freedom regarding life, liberty and property. However he who controls the money, controls the nation, and if the interventionist controls supply and demand then that is a serious blow to liberty. I will also agree its not the only thing at fault.


----------



## preponomics

machinist said:


> Quote:
> "I would be inclined to make very poor choices due to an intervening authority that has no right to insure my loans at Americas expense."
> 
> Cart before the horse here. The mortgage loan guarantees were not made ahead of the loans being made, but in fact were made AFTERWARD to keep the system from crashing. In fact, the loans were made simply on a FRAUDULENT basis by entities that knew they could sell off those hot potatoes before THEY got burned by them. There were ZERO guarantees at that point. Only when the loans went sour did TPTB step in and threaten Congress to give the banksters a bailout lest the whole country fall on it's butt.


Let me first say that I am not a conspiratorial assessor in my views of the subprime, believing it was a masterful plan. I instead believe that there were many direct and indirect players that understood a no-risk investment at our expenses and capitalized on it. Poor decisions mixed with greed, liquidity became scarce and the dominoes began to fall. Insolvency became realistic before they knew what hit them, however the whole operation was an interventionist heist. 
Freddie/Fannie had virtually unlimited backing with Americans money to back up any worthless loan (by the way they do now again). No money, no capital, no credit for even people who had bankruptcy on their credit report and you and me are going to make good on it. Thus they started lending "sub prime" loans in every direction. 
To make it worse the interest rates were so low that people were able to buy twice the house they could years earlier, unwary that adjustable rates were waiting in the wings to deliver knock out blows. To make matters worse they packaged all these loans in to little bundles and sold them all over the planet as reputable securities.

This is ten miles from honest private banking, loaning money upon their own risk in a free market economy. Thus its an intervenionary premise



machinist said:


> So, interventionism did not CAUSE this problem. Intervention was a REACTION to the problem.


To me it is both. In a true Laissez Faire style economy the individual and private sector business make up the rules for exchange. Though I do believe in local controls by propositional vote, contractual interstate commerce, and contractual foreign trade, I don't believe in economic intervention from lawful position (I believe separation of economics and state). I do however honer our laws, and even hope that we can move back to US constitutionality where the laws are less invasive on the individual.



machinist said:


> Would you care to elaborate on what you mean by advantaged corporatism? If you mean something on the order of monopolistic tendencies, or other unfair advantages, I would tend to agree with you. That is, short of something that borders on Socialism or centrally controlled economic systems. I don't like those who hammer the marketplace with unfair advantages, but I do endorse companies who profit because they have a better mousetrap, no matter if they are a corporation, a parnership, or any other style organization. BP, for example, I think has too much clout, along with oil conglomerates and probably Microsoft. But I like to see someone succeed based on merit and good management.


Monopolies
Here is my take on monopolies. Natural monopolies rarely happen and when they do the market will correct if no laws form to protect it. Most monopolies happen when a lawful advantage occurs. I just watched a series on tv about the men who built America and though I think they were fair about the good and bad impacts of these very large corporations, the single most important things they left out was how many times competitors were lawfully prevented to compete. Don't get me wrong I admire Rockefeller's genius for innovation but some innovation was done with politicians. I think Rockefellers company would have been half its size if monopoly patents and tariffs did not play a role in Standard Oils success. This led to distortions in the market place and poor working conditions with no other place for workers to go. If competition would have been allowed to thrive they would go across the street with another company. I believe in the beginning Standard Oil had over a hundred competitors but lawful advantage enabled him to eat them up.

Economic Intervention
A lawful advantage that would consist of disadvantaging regulations for competitors, unlevel taxation, penalties of fairness, subsidies to empower rescue or fairness, or lawful decisions of fairness. Also Central Banking uses a Keynesian premise to transfer wealth from an economy. Fixed artificial interest rates, increasing the money supply, and fractional reserve banking on a promise. All of this is lawful economic intervention

Corporations
In a true free market there is no need for a "corporation" but because of the kind of market we have there are many corporations that operate without an advantage and use the honest rules of capitalism. However there is a plethora of examples of corporatism also known as Crony Capitalism, or advantaged capitalism.



machinist said:


> Quote:
> "Gilles Saint-Paul was an economic Paternalist and believed in government intervention on many levels (nanny state). His premise was also written during a time where many intervention-styled economist projected the end of the labor force almost altogether within a few years, but the opposite happened. Again on the micro-economic level there is a case for companies to decrease the work force but overall the GDP typically goes up when capitalism is left alone in a free market economy. Companies succeed better and the jobs increase, not decrease. The intervention upon companies is what causes the decline in the labor force most of the time."
> 
> Yeah, jobs increased all right, mostly minmum wage jobs in fast food. The manufacturing jobs that paid well have gone to where the labor is even cheaper than in a highly automated US factory. Jobs in the automated industries declined on a PER UNIT of PRODUCTION basis. Which is what I said to start with. The displaced factory workers got lower paying jobs flipping burgers or such, if they got one at all.


Micro-economic level I agree but not on a Marco-economic level "IF" a free market economy existed. GDP goes up - more wealth overall, for more people - poor - middle class - rich



machinist said:


> What Gilles Saint-Paul believed or espoused is not important to the debate, even if it is an interesting sidelight. What counts is what happened to the US economy, and the fact is we now have a lot less jobs in the best categories. And the remaining jobs pay a lot less in real terms than factory jobs of yore. Yeah, I know that is a broad brush and that you can pick at the details of it, but the overall picture is that the US is headed for resembling the society in Mexico, with a broad wage disparity beween haves and have-nots, and a gutted middle class. Again, that is due to a whole host of reasons and concurrent events, but I find it ironic that Gilles' philosophy fell directly on it's butt, even while prediciting what became the ultimate demise of it.


You said "what counts is what happened to the US economy" - yes I can agree with that based on what happened but not in a "free market economy where the interventionist is not able to distort the market place".

I also agree that we are adopting the qualities of a third world country due the the socialistic intervention of despots who sit on pile of stolen money.

Ok I will admit Giles could predict in a market of intervention 



machinist said:


> For me, the bottom line is the ultimate result of our complex economic system being in its' present state of decline. A few in the US have gotten very rich, while the vast majority have gotten a lot poorer. So, would a lack of interventionism have prevented this? No.


We will have to disagree here - intervention is the primary cause mixed with lawful plunder. However It may be starting to be clearer to me that we are interpreting intervention differently.



machinist said:


> Fiat money will eventually reach its' intrinsic value, that of the paper it is printed on, per some obscure Frenchman I can't recall at the moment. Fiat currency is the best tool I know of to separate the masses from their wealth, and the most isidious.
> 
> If you said that fractional reserve banking and fiat currency were at the root of most of our problems I would agree. But that is still not all that is wrong.


I am with you on this, I do agree - as central banking and fiat currency strategies are pure plunder and intervention - an assault on the middle class first, then the small capitalist, and finally the rich capitalist until only the advantaged corporatist is standing among the poor. Then even they may get consumed by a sovereign power of pure despotism.



machinist said:


> And all the things that ARE wrong are sending us down a slippery slope toward that final cliff, and it is not the Fiscal Cliff in the news today, but the final repudiation of the US dollar by other countries.


Agree with this totally - I think it may be that we are seeing "intervention" in a different light


----------



## Paltik

machinist said:


> I have spent about 40 years involved in automation in various industries, and can say with assurance that there is one and ONLY ONE purpose for it. That is to *reduce cost by reducing labor content *in the product. The expenditure of capital for automating MUST be justified to the stockholders by reduced labor costs in the future. That means fewer jobs. Period. There simply is no arguing with that simple fact.


I must argue with that "fact" or at the very least qualify it.

Assuming a fixed market share (which could only happen if there is intervention--if someone forces people to buy in fixed ratios regardless of how suppliers may develop in terms of quality or price), then in your scenario a prudent industry could indeed reduce labor--fewer jobs.

However, what if the manufacturer leverages a lower cost-per-item into a cheaper product, undercutting competitors and growing in market share? The first alternative to fewer jobs is increased production with the same number of jobs. A manufacturer could profit from volume (e.g. $1 profit per item times 100 items sold = $100 profit, vs. $2 profit per item times 48 items = $96 profit), and also from economies of scale: the same truck that used to go half-empty to deliver goods can now, with a higher volume of sales, go out at the same cost and deliver more goods.

If it costs less per item to produce something, a number of things can happen. The fat cat capitalists can pocket a higher profit margin, or they can pass the savings on to consumers in the form of lower prices, or they can pay their labor more, or they can even do all three. My point here is that whoever ends up with a little extra cash now represents higher demand. That extra cash almost always contributes to the economy; if it's saved, it gets loaned to someone with an opportunity to use it to produce something that's wanted; if it's spent, a portion of it is used to pay wages and generate profits. In your scenario where automation leads only to fewer jobs, then the fewer jobs are only for the one manufacturer in the scenario. Outside that box, the extra spending power will be absorbed by the market and will help create jobs in other manufacturers or service providers.

The obvious, but by no means only, example of this, based on your scenario, is the provider of the automation that replaced labor; as manufacturers reduce labor through automation, providers of automation will have to increase labor to meet the rising demand. However, one could just as easily focus on the dairy industry ("fat cat owners can eat more ice cream") or the security industry ("fat cat owners will need more security guards to watch over their vaults") or cable tv ("consumers will pay for more premium channels with the money they save").

There are all kinds of unintended consequences to any economic transaction. I am very skeptical of arguments that rely on bracketing out this ripple of consequences. While it is true that such consequences can ultimately add up to a more favorable or less favorable economy, it isn't helpful to point to some unfavorable component of the economy and claim (without argument) that component is thereby unfavorable.


----------



## Paltik

machinist said:


> Quote: "I would be inclined to make very poor choices due to an intervening authority that has no right to insure my loans at Americas expense."
> 
> Cart before the horse here. The mortgage loan guarantees were not made ahead of the loans being made, but in fact were made AFTERWARD to keep the system from crashing. In fact, the loans were made simply on a FRAUDULENT basis by entities that knew they could sell off those hot potatoes before THEY got burned by them. There were ZERO guarantees at that point. Only when the loans went sour did TPTB step in and threaten Congress to give the banksters a bailout lest the whole country fall on it's butt.
> 
> So, interventionism did not CAUSE this problem. Intervention was a REACTION to the problem.


I think you two are talking about different points of intervention by the authorities. Programs such as VHA, Fannie Mae, and Freddie Mac are interventions; they increased demand for housing (by making financing easier), thus increasing the profits of those selling houses, at the expense of those wanting to buy houses who were unqualified for such programs. "Low-income" or "affordable housing" programs are interventions; again, the authorities use pressure on the market to generate a higher supply of mortgage loans than would otherwise exist. In fact, there were all kinds of government home loan guarantees on the books before 2000, on all levels (municipal, county, state, and federal), for groups such as native Americans, veterans, farmers, low-income earners, etc.

Then, when the housing bubble collapsed, there was another massive intervention with various bailouts.

So you're both right--some interventions came before, others came after.


----------



## machinist

Paltik,

I agree with much of what you said. My point about automation always reducing the number of jobs should have been qualified (I think I said this somewhere) by "fewer jobs per unit of production". IF, and that is a BIG IF, the company can increase sales, then there may be no layoffs from automating, but no increase in jobs, either for the increased production. The rest follows, more or less as you said. 

I would take exception to fat cats consuming more, since one can only consume a given amount of many things, like food, or toilet paper. Yes, they can BUY more and waste it, if that is what you meant, and many of the rich do that. More importantly, consumption patterns of the rich are far different than those of lesser means, and rich people tend to spend less as a % of income than they "invest", simply because of the excess money they have. Even so, they do consume a lot, no question about that. I doubt, however, that the rich can soak up enough of the products of mass production to make much difference. 

What happens to market share is very often, but not entirely, due to the intervention we have been bandying about. 

The proceeds of automation in big corporations go to all the usual suspects, with a hefty amount to the fat cats at the top. How much labor gets is more a matter of how much power they have. During a UAW strike in the early 1970's, I overheard division managers shout at their negotiators to "give the union whatever they want, but DON'T SHUT THE (production) LINES DOWN! (Don't allow a strike) WE ARE MAKING TOO MUCH MONEY TO LET THAT HAPPEN!" That allowed girls who operated a power screwdriver to make more per hour than I did as an engineer. Engineers were salaried, non-union, and had a lot less power. 

Later on, I saw the opposite happen at a different company. The company actually PROVOKED a strike, hired "scab" workers, and used an obscure law that allowed hiring "permanent replacement workers" =non-union, to achieve a majority of NON-union workers. Then, a vote for de-certification was called and the union was no more. This happened at a UAW plant less than 20 years after my contrary example above. The economic climate had changed, and labor had less power by then. And labor got less money. 

The biggest, most powerful rats always get the cheese, whether they turn out to be labor, or corporates. 

If the owners can find a way to reinvest and increase profits they commonly do so, whether it is going after market share, or increasing automation. The net result as the process goes on, is less money in the hands of labor, and more in the hands of the wealthy. That trend to greater income disparity has been inexorable for a long time now. I don't see how that disparity can make a case for consumption by the rich using up increased production through automation. It makes a better case for the opposite.

In the present economic climate with demand down, we have excess manufacturing capacity and excess labor, reducing the bargaining power of labor. This, I believe is the objective of the very powerful, although that is hard to prove. Average real labor wages go down while the take of the very rich is increasing. Historically, increasing income disparity goes on until it reaches some breaking point, and we have problems. Looks like we are getting closer to that point.


----------



## preponomics

machinist said:


> Paltik,
> 
> I agree with much of what you said. My point about automation always reducing the number of jobs should have been qualified (I think I said this somewhere) by "fewer jobs per unit of production". IF, and that is a BIG IF, the company can increase sales, then there may be no layoffs from automating, but no increase in jobs, either for the increased production. The rest follows, more or less as you said.
> 
> I would take exception to fat cats consuming more, since one can only consume a given amount of many things, like food, or toilet paper. Yes, they can BUY more and waste it, if that is what you meant, and many of the rich do that. More importantly, consumption patterns of the rich are far different than those of lesser means, and rich people tend to spend less as a % of income than they "invest", simply because of the excess money they have. Even so, they do consume a lot, no question about that. I doubt, however, that the rich can soak up enough of the products of mass production to make much difference.
> 
> What happens to market share is very often, but not entirely, due to the intervention we have been bandying about.
> 
> The proceeds of automation in big corporations go to all the usual suspects, with a hefty amount to the fat cats at the top. How much labor gets is more a matter of how much power they have. During a UAW strike in the early 1970's, I overheard division managers shout at their negotiators to "give the union whatever they want, but DON'T SHUT THE (production) LINES DOWN! (Don't allow a strike) WE ARE MAKING TOO MUCH MONEY TO LET THAT HAPPEN!" That allowed girls who operated a power screwdriver to make more per hour than I did as an engineer. Engineers were salaried, non-union, and had a lot less power.
> 
> Later on, I saw the opposite happen at a different company. The company actually PROVOKED a strike, hired "scab" workers, and used an obscure law that allowed hiring "permanent replacement workers" =non-union, to achieve a majority of NON-union workers. Then, a vote for de-certification was called and the union was no more. This happened at a UAW plant less than 20 years after my contrary example above. The economic climate had changed, and labor had less power by then. And labor got less money.
> 
> The biggest, most powerful rats always get the cheese, whether they turn out to be labor, or corporates.
> 
> If the owners can find a way to reinvest and increase profits they commonly do so, whether it is going after market share, or increasing automation. The net result as the process goes on, is less money in the hands of labor, and more in the hands of the wealthy. That trend to greater income disparity has been inexorable for a long time now. I don't see how that disparity can make a case for consumption by the rich using up increased production through automation. It makes a better case for the opposite.
> 
> In the present economic climate with demand down, we have excess manufacturing capacity and excess labor, reducing the bargaining power of labor. This, I believe is the objective of the very powerful, although that is hard to prove. Average real labor wages go down while the take of the very rich is increasing. Historically, increasing income disparity goes on until it reaches some breaking point, and we have problems. Looks like we are getting closer to that point.


Machinist
I think you point out here a repeated tragedy that consistently reoccurs in over two thousand years of economic history in varying degrees. Though with unique market differentiating circumstances, with or without automation, economic intervention has always matured unto economic disparity that favors the wealthy. Those with the power and those who control lawful intervention win. Automation is not the antagonist, intervention is. Intervention distorts the economy.

I could even argue that automation could lead to economic disparity if intervention is invasive enough. Maybe on some levels intervention is becoming that bad? But in a healthy free market economy automation is nothing but a resolve to efficiency, and over all prosperity for the country that business is established in. More jobs not less.

This is precisely why I contend that "all" economic intervention is a poor and cancerous part of an economy. The problem is that most everyone in society defines what kind of intervention is good and what intervention is bad. I think you just made my case and yours (above) at the same time, that in our current economy, disparity is becoming the result. I think this will only get worse as intervention increases. 2011 we had 40 thousand new laws, most with economic impacts.

I contend, that IF the economy is free and mean "free from intervention" then the outcome will be favorable. More prosperity, more economic freedom, and a higher GDP with more jobs not less jobs.


----------



## preponomics

Paltik said:


> I think you two are talking about different points of intervention by the authorities. Programs such as VHA, Fannie Mae, and Freddie Mac are interventions; they increased demand for housing (by making financing easier), thus increasing the profits of those selling houses, at the expense of those wanting to buy houses who were unqualified for such programs. "Low-income" or "affordable housing" programs are interventions; again, the authorities use pressure on the market to generate a higher supply of mortgage loans than would otherwise exist. In fact, there were all kinds of government home loan guarantees on the books before 2000, on all levels (municipal, county, state, and federal), for groups such as native Americans, veterans, farmers, low-income earners, etc.
> 
> Then, when the housing bubble collapsed, there was another massive intervention with various bailouts.
> 
> So you're both right--some interventions came before, others came after.


I do agree that intervention has been around for a long time.

I think the progressive era in the late 1800's is when economic intervention started to get traction (on the right and the left side). Then in the early 1900's it started to congeal unto strategic agencies and political groups being financed by lawful banking strategies. Then in the great depression it was given steroids to grow all things bigger. Then unto the 1970's the planks and risers were fabricated for a lovely giant spiral staircase. Since the 1970's till now the staircase is being constructed, and with each decade the staircase takes a turn to the left and then to the right, spiraling us out of control into the heavens of unsustainable debt, and eventual poverty. A heavily abode for the despot who will trample the innocent beyond recognition as he sits upon a golden spoil of stolen wealth.

As a Christian I will simply yield to legal plunder and render unto Caesars what is Caesars (however it is a paradox as to "who" is Caesar here?). I will obey the law, and with harmless motivation warn as many as possible of the coming storm. I find people here on this forum the prepared or as prepared as can be for the interventionist trample.

Forgive my poetics


----------



## machinist

preponomics,

Got any good ideas for preserving wealth through a currency devaluation? I worry about problems with all the usual strategies.

-Govt. bonds go sour as the dollar dissolves into vapor.
-Stocks, about the same, although some may eventually have salvage value. 
-Gold and silver were subject to "buyback" (theft) by govt. in the 1930's, and could be grabbed again to back a "new dollar". 
-Land is subject to property tax, so it has to be productive to pay that. 
-Food and personal goods deteriorate too fast. 
-Firearms and ammunition are a class of their own when it comes to being a problematic investment, being more vulnerable all the time to legislation. 
-Livestock wants to be fed.
-Jewelry and collectibles are luxury items that may not have a market in bad times.

All of the above suffer from being illiquid to varying degrees.

If TPTB have their way, we will have _a slow, drawn out crash until the system cannot hold together, then fall precipitously. _ That gives them the maximum opportunity to suck wealth from the poorer groups, and to move that wealth out of harm's way.

That means we need a means of getting through a comparatively long siege of currency troubles, sorta like Argentina, maybe. My only answers for that scenario are to first, be able to provide a lot of our own needs, and second, to participate in the economy to whatever degree I can as a small business.

Anyone have any better ideas? I'm not inclined to just lay around and let it happen to me without whatever forethought I can muster.


----------



## Paltik

I can't predict the future, and can imagine scenarios where any given investment gets crushed.

But what about investing in foreign stocks? Energy stocks? Mining? Foreign currencies? Commodities other than precious metals (think copper or sugar). Of course, when investing foreign, steer clear from economies/sectors directly linked to the US economy.

Practically speaking, I think a lot of people would do well to have some good way of generating an income, via skills (invest now in education), a small business, or productive land.


----------



## Padre

machinist said:


> Got any good ideas for preserving wealth through a currency devaluation? I worry about problems with all the usual strategies.
> 
> -Gold and silver were subject to "buyback" (theft) by govt. in the 1930's, and could be grabbed again to back a "new dollar".
> -Land is subject to property tax, so it has to be productive to pay that.
> -Food and personal goods deteriorate too fast.
> -Firearms and ammunition are a class of their own when it comes to being a problematic investment, being more vulnerable all the time to legislation.
> -Livestock wants to be fed.
> -Jewelry and collectibles are luxury items that may not have a market in bad times.


My family survived the Imperial Russians, the Nazis, and the Communist Russians and managed to preserve some real wealth with a mix of these strategies. Ultimately, remembering the Gospel, it is always possible that tomorrow we die leaving our wealth to no one. So trust in God is one of the ultimate forms in wealth preservation because it preserves your sanity.

No single one of these categories is immune to the whims of statists, but if you are willing to break the law here and there these things can keep you afloat. Land, for instance, can be taxed or confiscated, but if they tax it so much you can't afford to live on it or confiscate it and don't have anyone to work that land it reaps them no benefit. The trick with land is having land out of the way, where the state won't want it. Land that is not too valuable having no strategic value. Land, food, and cattle, all offer the benefit of allowing you to eat even when your income approaches zero, which means that you won't need to try to divest something like gold or jewelry when food is much more valuable than precious metals or stones. What good is it to preserve wealth and die of starvation. True they are perishable, but they preserve real wealth by keeping you out of a tough spot. Ultimately my family found (out of the way) property and gold/jewelry were the best long term wealth preservers. Gold particularly is nice because in its physical form it is easily hidden.


----------



## preponomics

machinist said:


> preponomics,
> 
> Got any good ideas for preserving wealth through a currency devaluation? I worry about problems with all the usual strategies.
> 
> -Govt. bonds go sour as the dollar dissolves into vapor.
> -Stocks, about the same, although some may eventually have salvage value.
> -Gold and silver were subject to "buyback" (theft) by govt. in the 1930's, and could be grabbed again to back a "new dollar".
> -Land is subject to property tax, so it has to be productive to pay that.
> -Food and personal goods deteriorate too fast.
> -Firearms and ammunition are a class of their own when it comes to being a problematic investment, being more vulnerable all the time to legislation.
> -Livestock wants to be fed.
> -Jewelry and collectibles are luxury items that may not have a market in bad times.
> 
> All of the above suffer from being illiquid to varying degrees.
> 
> If TPTB have their way, we will have _a slow, drawn out crash until the system cannot hold together, then fall precipitously. _ That gives them the maximum opportunity to suck wealth from the poorer groups, and to move that wealth out of harm's way.
> 
> That means we need a means of getting through a comparatively long siege of currency troubles, sorta like Argentina, maybe. My only answers for that scenario are to first, be able to provide a lot of our own needs, and second, to participate in the economy to whatever degree I can as a small business.
> 
> Anyone have any better ideas? I'm not inclined to just lay around and let it happen to me without whatever forethought I can muster.


My friend your list articulates the challenge very well indeed. Is there anything safe from a thousand foot leviathan when you're locked in its cave? Let's hope that the American people are wise enough to keep the doors open, I think they will, or at least I hope so.

_I shall ponder the perhaps-able and things which may or may not occur and then let my vivid imagination wander upon the possible._

I believe like you it will probably build up slowly to an unsustainable collapse where inflationary strategies will transfer a nations wealth unto plundering poverty. With it manifest, there could be turmoil, job loss, home loss, hoover-villes accross the country (tent cities), pocket riots and of course the collapse of the dollar. Maybe a quarter of our nation could be displaced in a matter of months, but there will surely be a reset of some kind (probably another manipulated fiat currency). 
I believe most likely (just a wild capricious prediction) that the economic collapse that could be coming (provided that our monetary policy stays the same) will not induce a mad-max style apocalyptic end, but rather it would be more like a Greece style collapse but on a larger scale mixed with some of the impacts we had with our great depression. However let's pray we are not saved by Marshall law or an Argentina reality could contagiously by chance position the TPTB for a terrible end to individual liberty.

_I shall now attempt to ponder the motives of our past leaders hearts in order to predict a praxiological outcome for lawful intervention, yet I contend that I do not know their intentions intimately._

To me if the dollar fails, then I don't think the TPTB will try to take our gold out-right but instead they will try to pass laws to make it hard for us to use our gold and silver for money (barter) in a currency debacle. They will say its "immoral to have a gold/silver advantage" (disadvantaging the individual), or they will pass laws fixing its value like they did in the depression. After all it's already illegal now on many levels to trade without federal notes, and to exchange freely will land one in jail (it is wise to obey the law even unto plunder lest we be eaten, thus I pay homage submissively to avoid its force). I suspect they could simply marginalize the use of gold even further with more laws. However, I think people are so informed about gold at this point that our nation would not permit a pure confiscation law, which intern would cause them to opt for a plethora of ambiguous laws beyond simple comprehension to manifest arduous exchange. If you can't take the kids lunch, then at least make sure he can't eat it.

I should consider that FDR did not confiscate, he instead required you to turn it in if you had too much of it, and then forced a new lawful method of exchange upon Americans on how money was to be paid, meaning that "debts" could not be repaid in gold, you instead had to pay debts with FED notes. It was an interventionist scheme to remove gold out of the economy and empower Keynesian and interventionist monetary policy. I would imagine that this also would be the goal in a new collapse and to punish any economic leverage or freedom unto more control. They must save us at all costs! However the benevolent rescue from above is the curse of poverty, as you probably know.

If our country were to find the lost principles of individual liberty given to us in the classical liberal tradition by our founding fathers, that would protect us from ambiguous law, then we could simply vote in representatives that will bring us back to economic sobriety, but who knows if that will happen anytime soon.

For me I buy and invest intrinsically (metal, commodities and preps), and am starting to focus on emerging markets which are unfortunately better than our own.


----------



## preponomics

Paltik said:


> I can't predict the future, and can imagine scenarios where any given investment gets crushed.
> 
> But what about investing in foreign stocks? Energy stocks? Mining? Foreign currencies? Commodities other than precious metals (think copper or sugar). Of course, when investing foreign, steer clear from economies/sectors directly linked to the US economy.
> 
> Practically speaking, I think a lot of people would do well to have some good way of generating an income, via skills (invest now in education), a small business, or productive land.


Paltik - do you have mining stocks? if so how did they perform since 2006? I have had several people advise me to invest in them. I just cant see the performance gains in them but I have looked at them very little.


----------



## preponomics

Padre said:


> My family survived the Imperial Russians, the Nazis, and the Communist Russians and managed to preserve some real wealth with a mix of these strategies. Ultimately, remembering the Gospel, it is always possible that tomorrow we die leaving our wealth to no one. So trust in God is one of the ultimate forms in wealth preservation because it preserves your sanity.


I can only imagine your families struggle and am encouraged when I hear this kind of testimony of survival. It causes me to believe that America has hope to reclaim our heritage of constitutional freedom and this time with more wisdom that shuns economic intervention, corporatism and the hideous trespass of slavery.

Although I do believe it will get far worse - I also believe that the "worse" will only happen before its gets far better with a more informed and educated America regarding, individual liberty, individual sovereignty over ambiguous law, despotism and economic intervention.


----------



## machinist

FDR "bought" all the gold he could get his hands on, THEN immediately devalued the "dollars" he had paid with, to something like 2/3 of what it was worth the day before. THAT is thievery, at its' most blatant. He effectively stole 1/3 of the nation's privately held wealth in one lick.

The really crappy part of that is, very few people even realized what had happened. It is still going on today, with very few people the wiser.


----------



## Paltik

preponomics said:


> Paltik - do you have mining stocks? if so how did they perform since 2006? I have had several people advise me to invest in them. I just cant see the performance gains in them but I have looked at them very little.


I have not invested in mines, but as a hedge against hyperinflation they make sense. Mines that are shut down are not as attractive investments as going concerns, but as the price of metals inflates, the return on labor and capital makes it more attractive to operate the mine.


----------



## preponomics

machinist said:


> FDR "bought" all the gold he could get his hands on, THEN immediately devalued the "dollars" he had paid with, to something like 2/3 of what it was worth the day before. THAT is thievery, at its' most blatant. He effectively stole 1/3 of the nation's privately held wealth in one lick.
> 
> The really crappy part of that is, very few people even realized what had happened. It is still going on today, with very few people the wiser.


Hey, i will not defend FDR on any level 

except maybe his love for Stalin just after Stalin starved ten million people to death


----------



## preponomics

Paltik said:


> I have not invested in mines, but as a hedge against hyperinflation they make sense. Mines that are shut down are not as attractive investments as going concerns, but as the price of metals inflates, the return on labor and capital makes it more attractive to operate the mine.


It makes sense to me too, even though I dont know them well. Its seems logical that hyper-inflation would cause them to become hyper -profitable overnight


----------

