U.S. Economy Is Increasingly Tied to the Rich

[Jhhnn]

well doh!

A democratic economy is like a game of monopoly, if you play long enough the majority of the moolah winds up in just a few hands. If you don't have some mechanism of redistribution like progressive tax rates and reasonable estate taxes then the economy will eventually work its way towards serfdom until reset by revolution.

qft.

 

[rudder]

How much do you think the rich give to their servants, the Republican party to keep the rest of the people in a constant state of agitation against the Democratic party where the only possible hope for them lies? I know, I know, they own them too. And whose fault is that?

The fault lies with people like you who have so much blind faith in the democrats. 8 out of the top 10 richest congressman are democrats. A majority of the top 50 richest congressmen are democrats.

Do you honestly believe they give a crap about your well being? You are nothing more than a vote for them.

The top one of the list even goes out of his way to avoid paying taxes on his yacht by berthing it in another state. Will he ever invite you to his yacht? Maybe if somehow you controlled 100,000 votes he may let you stand on the dock and drink some tea while you admire that yacht.

Do the rich really own the democrats? They seem to be doing fine by their own right.

 

[khon]

Well doh!

A democratic economy is like a game of monopoly, if you play long enough the majority of the moolah winds up in just a few hands. If you don't have some mechanism of redistribution like progressive tax rates and reasonable estate taxes then the economy will eventually work its way towards serfdom until reset by revolution.

I think you mean capitalist rather than democratic, other than that you're correct though.

The fundemental problem with trickle down economics was always that its based on either a misunderstanding or a deception. Money flows from poor to rich, not the other way around. So to start out giving the money to the rich makes no sense, as it will simply stay there and provide little benefit to anyone else.

 

[spidey07]

I think you mean capitalist rather than democratic, other than that you're correct though.

The fundemental problem with trickle down economics was always that its based on either a misunderstanding or a deception. Money flows from poor to rich, not the other way around. So to start out giving the money to the rich makes no sense, as it will simply stay there and provide little benefit to anyone else.

What the hell? What do you mean "giving money to the rich"?

They EARNED that money. Any money does flow from the rich to the poor - who signs your paycheck?

 

[Cogman]

I think you mean capitalist rather than democratic, other than that you're correct though.

The fundemental problem with trickle down economics was always that its based on either a misunderstanding or a deception. Money flows from poor to rich, not the other way around. So to start out giving the money to the rich makes no sense, as it will simply stay there and provide little benefit to anyone else.

Really? That's news to me. And here I always thought my employer earned more money than me. Heck, I guess I must earn more money then the company as well, because it makes sense now when you put it in that light.

Given the combination of the article, and the fact that rich people employ poor people, your argument is insane. If anything this article says "Rich people pay the bills for most of everything." They drive the economy, not poor people.

 

[HendrixFan]

Mark my words, you kill the spending of that top 5 percent and we are going to tank even worse. Then again that's what Obama wants, he's doing this on purpose. I don't think people realize just how much money we're talking about here in terms of tax increases. It's not just the federal tax increase, it's all the rest piled on top of it. HENRYs are in that area and are set to get killed.

You must be too young to remember the 90s. Taxes became more progressive, income distribution became more evened out, yet everyone prospered. It may run counter to your ideology, but giving 80 percent of the population more money to spend moves around money faster than constraining it to the top 5 percent. Moving money around faster helps the entire economy grow, giving the top 5 percent more than enough to offset their "losses".

Look over some economic data from the 90s.

 

[xj0hnx]

The fundemental problem with trickle down economics was always that its based on either a misunderstanding or a deception.

Money flows from poor to rich, not the other way around.

I just couldn't help but laugh at this. Really? Where do the poor get all this money they are giving to the rich? Is it from the businesses they run?

 

[HendrixFan]

What the hell? What do you mean "giving money to the rich"?

They EARNED that money. Any money does flow from the rich to the poor - who signs your paycheck?

And who pays those who sign paychecks? Even running your own business you have to answer to someone, the customer.

Where does Walmart get their money?

 

[Cogman]

And who pays those who sign paychecks? Even running your own business you have to answer to someone, the customer.

Where does Walmart get their money?

If you read the article from the OP, the answer is overwhelmingly "the rich".

According to new research from Moody's Analytics, the top 5% of Americans by income account for 37% of all consumer outlays.

That means that the rich buy the most stuff.

 

[spidey07]

And who pays those who sign paychecks? Even running your own business you have to answer to someone, the customer.

Where does Walmart get their money?

From every class of person there is. This article is nothing more than the class warfare bullshit being thrown around in here. It's all an attempt to rabble the idiots of "yeah! tax those evil rich, look at how much they spend!"

And you marxists are all too happy to lap it up. Spread it around you say, redistribute it you say. This is AMERICA! We The People don't want that shit in our country.

 

[BassBomb]

wait so you are saying, people with money to spend have been spending money thus driving the economy?

/boggle

 

[spidey07]

wait so you are saying, people with money to spend have been spending money thus driving the economy?

/boggle

But it's not fair! Why do they get to spend that money? I want that money!

 

[HendrixFan]

If you read the article from the OP, the answer is overwhelmingly "the rich".

The problem is that increasingly the money is rotating around the top 5 percent. The article from the OP wasn't what my response was meant for, it was the comment about money originating at the top and being graciously handed down to the proles.

To relate it to the OP, money is more likely to be spent on a yacht and the proceeds going to the elite; than that same amount of money being spent at Walmart, paying tons of lower wage employees before getting what is left(think 8% profit for most grocery stores). The yacht purchase does little to nothing to circulate money around to the other income groups. This is where consolidation of wealth and poor income distribution come to affect the economy at large. If pure capitalism doesn't work, then government intervention is needed to help a healthier distribution. Going back to the OP's post, economic stability is tied to income distribution.

 

[Cogman]

But it's not fair! Why do they get to spend that money? I want that money!

We should all just have the same amount of money, that way we can all spend the same amount of money! That is clearly the only solution.

 

[Cogman]

The problem is that increasingly the money is rotating around the top 5 percent. The article from the OP wasn't what my response was meant for, it was the comment about money originating at the top and being graciously handed down to the proles.

To relate it to the OP, money is more likely to be spent on a yacht and the proceeds going to the elite; than that same amount of money being spent at Walmart, paying tons of lower wage employees before getting what is left(think 8% profit for most grocery stores). The yacht purchase does little to nothing to circulate money around to the other income groups. This is where consolidation of wealth and poor income distribution come to affect the economy at large. If pure capitalism doesn't work, then government intervention is needed to help a healthier distribution. Going back to the OP's post, economic stability is tied to income distribution.

In other words. "Blah blah blah... I want to complain about how much the rich spend and simultaneously complain that they don't do any good for the economy."

Yachts don't just appear out of thin air. And everyone involved in the building of a yacht isn't a millionaire. I know this is astounding to think about, but just about every product out there is produced by someone with a low to mid range pay scale. If a rich guy buys a $300,000 car, that car wasn't produced exclusively by another rich guy.

 

[HendrixFan]

From every class of person there is. This article is nothing more than the class warfare bullshit being thrown around in here. It's all an attempt to rabble the idiots of "yeah! tax those evil rich, look at how much they spend!"

And you marxists are all too happy to lap it up. Spread it around you say, redistribute it you say. This is AMERICA! We The People don't want that shit in our country.

You are ignoring my post about the 90s and the economic data from it. You aren't even responding to the substance of my post, which was that money flows from rich to poor in the form of spending. Instead you are falling back to attacks.

Going back to the OP's post, a healthy economy has something resembling a normal income distribution. Due to the sheer size of corporations we are well past anything resembling a reasonable capitalist society in which consumers have equal power as a seller. The classic buyer/seller curve doesn't exist. The sellers are too powerful and can dictate things to the buyers. Don't pretend you are trying to defend capitalism here, against attacks of marxists. I want something resembling capitalism, in which any "wrong" move can have someone replaced.

 

[BoberFett]

I think you mean capitalist rather than democratic, other than that you're correct though.

The fundemental problem with trickle down economics was always that its based on either a misunderstanding or a deception. Money flows from poor to rich, not the other way around. So to start out giving the money to the rich makes no sense, as it will simply stay there and provide little benefit to anyone else.

It never ceases to amuse me that those who detest Reagan's trickle down are such staunch advocates for the biggest form of trickle down ever invented: Send trillions of dollars to the federal government, and then hope some of it comes back to you.

 

[HendrixFan]

In other words. "Blah blah blah... I want to complain about how much the rich spend and simultaneously complain that they don't do any good for the economy."

Yachts don't just appear out of thin air. And everyone involved in the building of a yacht isn't a millionaire. I know this is astounding to think about, but just about every product out there is produced by someone with a low to mid range pay scale. If a rich guy buys a $300,000 car, that car wasn't produced exclusively by another rich guy.

I understand that and even articulated that in my post. Additionally, the build cost and markup (profit margin) is much higher than commodity goods sold at Walmart. It has to be in order for yacht or luxury car builders to survive. Walmart couldn't sustain 40% profit margins and exist.

I don't care if the rich buy yachts, it is their money to spend. On a large scale, as outlined in the OP, and the entire point the article was making if it has to be clarified for you; on a large scale the income distribution being consolidated at the top is bad for the economy. If our economy is built entirely on rich people buying yachts, it is unhealthy and unsustainable. If we don't work to correct it now, it will correct itself eventually, and in a much more jolting manner. Also, if the natural course is correction, how can it be "bad" to correct it?

 

[HendrixFan]

It never ceases to amuse me that those who detest Reagan's trickle down are such staunch advocates for the biggest form of trickle down ever invented: Send trillions of dollars to the federal government, and then hope some of it comes back to you.

There is another solution that can satisfy both of you. Lower spending considerably, cut taxes considerably, and work on real regulation to keep things going smoothly.

It doesn't have to jump from one bad extreme to another. There is a gray between black and white.

 

[xj0hnx]

money is more likely to be spent on a yacht and the proceeds going to the elite; than that same amount of money being spent at Walmart, paying tons of lower wage employees before getting what is left(think 8% profit for most grocery stores). The yacht purchase does little to nothing to circulate money around to the other income groups.

What a load of bullshit. So are the uber rich building the yachts? Supplying the materials to build the yachts? People had to be paid for the materials, people had to be paid to build it, ship it, yadda, yadda. I guess all the "Made in China™" products in Walmart are really boosting our economy. Can all the employees of a Walmart build a yacht?

 

[Cogman]

I understand that and even articulated that in my post. Additionally, the build cost and markup (profit margin) is much higher than commodity goods sold at Walmart. It has to be in order for yacht or luxury car builders to survive. Walmart couldn't sustain 40% profit margins and exist.

I don't care if the rich buy yachts, it is their money to spend. On a large scale, as outlined in the OP, and the entire point the article was making if it has to be clarified for you; on a large scale the income distribution being consolidated at the top is bad for the economy. If our economy is built entirely on rich people buying yachts, it is unhealthy and unsustainable. If we don't work to correct it now, it will correct itself eventually, and in a much more jolting manner. Also, if the natural course is correction, how can it be "bad" to correct it?

Your point, initially, was that trickle down economics doesn't work because the poor fund the rich. After pointing out that is BS, now your argument is "We need more government regulation to avoid a 'Shock'". I would say that as well is BS. I might agree with you if the government was in a position to correct anything (IE not running trillion dollar deficits) however, that isn't the case. A government bailout/funding to the poor would just delay the inevitable collapse, but instead of being a small jolt, it creates a large one as the failure won't just be a business or two, but rather the entire federal government.

Increasing taxes on the rich just isn't going to cut it. Nor is saving the poor. The government needs to be putting out less stimulus and (in my opinion) raising taxes. We should run it in a surplus until the national debt is payed off, or close to payed of. Only then should the government think about intervening and saving the poor from the evil rich.

However, that is a bit off topic.

 

[khon]

I just couldn't help but laugh at this. Really? Where do the poor get all this money they are giving to the rich? Is it from the businesses they run?

If money actually flowed from the rich to the poor there would cease to be a wealth disparity between the two groups.

If on the other hand money flows from the poor to the rich as I'm claiming, the wealth disparity between the two groups would increase, which is exactly what has been happening over the past 30 years.

 

[HendrixFan]

What a load of bullshit. So are the uber rich building the yachts? Supplying the materials to build the yachts? People had to be paid for the materials, people had to be paid to build it, ship it, yadda, yadda. I guess all the "Made in China™" products in Walmart are really boosting our economy. Can all the employees of a Walmart build a yacht?

Something with an 8% profit margin has 92% costs built into it. Something with a 40% profit margin has 60% costs built into it. Given comparable sales dollars, one leaves more money to a single party (owner) than the other.

Again, it isn't that yachts don't have a place in our economy. Yachts (and the like) being the majority of our economy are a problem.

 

[IGBT]

a PBF (poor broke fusk) never gave any of you's guys a job. If it wasn't for the rich, most of you guys would be PBF's.

 

[khon]

It never ceases to amuse me that those who detest Reagan's trickle down are such staunch advocates for the biggest form of trickle down ever invented: Send trillions of dollars to the federal government, and then hope some of it comes back to you.

Who said I was talking about welfare ?

The problem is mainly wages. Lets say you do a job that creates 1$ in value, how large a portion of that 1$ do you get paid ? The answer is your portion has been decreasing since Reagan.