Two Economies

Two Economies: Government Workers Optimistic, Private Sector Not

Monday, December 28, 2009

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Government employees are much more bullish about the economy than those who work in the private sector. That's a big change from the beginning of the year when those on the public payroll were a bit more pessimistic than private sector workers.

Data from the Rasmussen Consumer Index
from the past seven days shows that a plurality of government workers think the economy is getting better while those who work in the private sector tend to have the opposite view. Those in the government sector are also more upbeat about the current state of the economy and their own personal finances.

Today, 46% of government employees say the economy is getting better while just 31% say it's getting worse. Among those who work in the private sector, the numbers are reversed: 32% say better and 49% worse.

Twenty-four percent (24%) of government employees rate the economy as good or excellent while just nine percent (9%) of those in the private sector are so upbeat.

Fifty-five percent (55%) in the private sector rate the economy as poor, a pessimism shared by 38% of those on the public payroll.

Forty-four percent (44%) of government employees rate their own personal finances as good or excellent while 33% of private sector workers do the same.

Among those on the government payroll, 31% say their finances are getting better, and 40% say they're getting worse. The comparable private sector numbers are 23% better and 47% worse.

These figures reflect a dramatic change from January 2009, with a growing optimism among government workers. During the course of this year, there has been a significant increase in government spending and a government takeover of General Motors.

The Obama administration estimates that federal spending will reach 28% of GDP in 2009, up from 19% a decade ago. It's the largest share of the economy consumed by the federal government since the fighting stopped in World War II.

In the private sector, such growth would be considered boom times for any industry, and government employees have undergone a remarkable change in attitude over the course of the year. In January, just 22% of government workers thought the economy was getting better, a figure that has jumped to 46% today. The number of government workers who think the economy has gotten worse has fallen in an equally dramatic manner, from 61% in January to 31% today.

Among those who work in the private sector, however, the change has been far less significant. In fact, the number of private sector workers who think things are getting better has improved just six points, from 26% up to 32%.

Most Americans (51%) believe that government employees are paid too much.
Not surprisingly, those who work for the government disagree. Fifty-nine percent (59%) of all Americans say the average government worker earns more annually than the average taxpayer.

Fifty-five percent (55%) of government workers expect to have the same employer in five years. Only 27% of those who work for someone else expect such job longevity.

Sixty-six percent (66%) of voters nationwide expect government spending to go up during the Obama years, but 59% believe that an increase in government spending will hurt the economy.

Most voters say tax cuts are a better way to create jobs and fight unemployment

Joe Wilson Speaks For Me... Too.

From the transcript posted online by CBS, these were the words spoken by the President just prior to Joe Wilson's exclamation, "Lie ! You Lie!". I was listening on the radio and heard every word. Pure demogoguery that made the hair on the back of my neck stand on end... literally. It was not the particular statement on illegals which prompted Rep Wilson's response, it was these statements in total.

"Some of people's concerns have grown out of bogus claims spread by those whose only agenda is to kill reform at any cost. The best example is the claim made not just by radio and cable talk show hosts, but by prominent politicians, that we plan to set up panels of bureaucrats with the power to kill off senior citizens. Now, such a charge would be laughable if it weren't so cynical and irresponsible. It is a lie, plain and simple. There are also those who claim that our reform efforts would insure illegal immigrants. This, too, is false. The reforms -- the reforms I'm proposing would not apply to those who are here illegally."

 Many independent organizations have confirmed that bureaucratic panels will be set up to determine life's solemnity, that illegals will not be excluded from participating in the program, and that abortions, addressing the President's comments which directly followed the retort from Rep Wilson, will be federally funded under the current version of legislation to which the President refers.

Who believes that Republican politicians and conservative talk show hosts want to "kill reform at any cost"? Is reiterating concerns being raised and cases being documented by British and Canadian citizens who live with Socilized healthcare cynical and irresponosible? Is it "lying, plain and simple"?

 

You can argue that the decorum of the chamber was disrupted, but Bob Lonsberry provides a great rebuttal.

http://snipurl.com/rr76z   [www_lonsberry_com]

Liberal Sciolism

I have been asked to post these liberal arguments in their entirety so that they can me dissected:

 

Argument I

 

It is good to hear from, just to get things clarified I am not an Obama
> > "maniac" like many of my peers. I just tend to agree with his policies which
> > is generally directed towards the common "man"; he is still a politician
> > nonetheless. Also to be noted I am doing a research paper on this topic, and
> > when I get my results I can give you more information(My paper is what
> > promotes economic stability). Anyways...
> > I see your concern with Obama, like many other conservative Americans.
> > The stimulus is a scary thought because it's creating more debt and
> > inflation, but inflation is not always bad. If our currency is valued lower
> > then another country's, it will promote exports from our country(because are
> > products will be a lot more affordable on the
> > market) which we do need badly.
> > One of our reasons for the collapse of our economy was the trade deficit. We
> > as a country were buying much more then selling. A good example of this was
> > with GM, many Americans because of cost resorted to buying foreign cars.
> > Also to add on to stimulus argument, I am a big believer in Keynesian
> > economics. John Maynard Keyes believed that investment by government injects
> > income, which results in more spending in the general economy, which in turn
> > stimulates more production and investment involving more income and spending
> > and so forth. The initial stimulation starts a cascade of events, whose
> > total increase in economic activity is a multiple of the original
> > investment.
> >
> > I hope this helps explain why I am a supporter of Obama, but I only tackled
> > the economic aspect of his policies since I figured this is of most worry to
> > you. If you have any other concerns feel free to let me know? I love
> > debating politics and hope to hear from you soon.
> >
> > Thanks-

 > >
> > Also, it may seem like the stimulus is like a dead fish, but just give it
> > time.

 

Argument II

 

First off I wasn't given you advice about Obama's policy. As I recall you asked me verbatim "maybe you know something I don't. Why do you think he won't?" I merely answered your question. Second to say you know more about Obama's policies then me is not a good way to start off an argument. I will however, acknowledge you may have the upper hand in Economics, since my area of study is comparative relations.
>
> Now to answer your question on the "common man", from your description you are the common man. The worker, proletariat,the third estate, etc that is you. The policies of free market and/or Laissez-faire policies benefit the few. Obama's policy is directed towards individuals like yourself, with a somewhat wealth distribution. In the United States we have the highest income disparity (a ratio of 45%) out of any developed country. You need to tell me how this is OK? There are extreme amounts of poverty in the United States, (in 2007, 37.3 million Americans lived in poverty) this can be attributed to one of the reasons the United States is one of the most dangerous developed countries in the world! Obama's policy is to lower the gap to promote a more equal SES and to give the middle class a helping hand. This philosophy or agenda favors the middle class, like yourself, however, you just don't agree with it. Also to be noted, centering a countries economy exclusively on a back of businesses is unhealthy. Granted free market does promote tremendous growth, and this is where you and I differ. I am a believer in slow progress and stability, rather then high growth but the foundation is shaky.
>
> After the great depression our government moved towards a more regulated economy, until Reagan came to office and promoted "Reagan Economics." His philosophy was based on 4 pillars. 1. Reduce the growth of government spending. 2 Reduce marginal tax on income from labor and capital. 3 Reduce government regulation of the economy. 4 Control the money supply to reduce inflation. Reagan's policies pushed both the international transactions current account and the federal budget into deficit and led to a significant increase in public debt. Debt exploded from 900 billion dollars before Reagan's tenure to 2.8 trillion dollars after his tenure; an increase of over 200%. This overspending would be continued in later presidents, with the result that debt 20 years later would jump to over 10 trillion.
>
> Now back to the current crisis and what caused it. It started in 1992, when Congress and the Clinton administration weakened regulation of Fannie Mae and Freddie Mac with the goal of making available more money for the issuance of home loans, which I believe to be the big reason for this recent collapse. In 1999 (by this time the Republicans had the majority), Congress passed the Gramm-Leach-Bliley Act, which repealed part of the Glass-Steagall Act of 1933 (By the way the repeal of the Glass-Steagall act was led by two Republicans, Phil Gramm of Texas and Representative Jim Leach of Iowa). This repeal has contributed to the proliferation of the complex and smeared financial instruments which are at the heart of the crisis. Another probable cause of the crisis was the widespread miscalculation by banks and investors of the level of risk inherent in the unregulated collateralized debt obligation and Credit Default Swap markets. Under this theory, banks and investors systematized the risk by taking advantage of low interest rates to borrow tremendous sums of money that they could only pay back if the housing market continued to increase in value.
>
> Furthermore the housing bubble grew up alongside the stock bubble of the mid-1990s. People who had increased their wealth substantially with the extraordinary run-up of stock prices were spending based on this increased wealth. This led to the consumption boom of the late 1990s, with the savings rate out of disposable income falling from five percent in the mid-90s to two percent by 2000. The stock-wealth induced consumption boom led people to buy bigger and/or better homes, since they sought to spend some of their new stock wealth on housing. The bubble began to burst in 2007, as the building boom led to so much over-supply that prices could no longer be supported. Prices nationwide began to head downward, with this process accelerating through the fall of 2007 and into 2008. As prices decline, more homeowners faced foreclosure.
>
>
> Now for the argument of stimulus, it is necessary because we can't let business fall. I know many believers like yourself believe that the markets will work themselves out. This is true, but only to a certain clarification of "work themselves out". By letting business fall it will create less income for a country and less jobs. GM for example is a perfect example. If we let GM fall(along with Ford and Chrysler) there will be less jobs created and less revenue for our country. The new car manufactures would be foreign owned and made, and would not produce any jobs in the states. Now Granted, Toyota has a plant in the Unites States but the revenue would not go to our country. Also by promoting tax breaks, it takes for an axiom that people will spend more money on the economy. When the economy is struggling people are very hesitant to spend. One could give tax breaks, but what if very few people spend and invest it on the economy? A stimulus accounts for this variable, and gives money directly to business and government to invest. Government can use the money for infrastructure of a state, and by doing so create jobs.
>
> It seems that I have said a little to much. I hope to hear soon your arguments. To sum up what I am trying to get after. I believe that stability is more important then quick growth. The whole of citizens should grow together, instead of a few. Obama is hoping to bring more equal SES, then we have had before and I just agree with it.
> Hear from you soon-

 

Argument III

 

Good to hear from you again. I agree with you on staying more centered on our original topic. However, I must respond to some of the things you said. First and I want to get this clear. You probably think I have professors at the U telling me what to believe regarding politics. This simply is not true, my beliefs are my own because I have agreed with the philosophy of a collective whole growing together. I agree with less poor even if it means sacrificing in some ways. You claim that Europe is doing bad. Yet their poverty rate is nowhere near the rate of America. When I meant extreme poverty, I did not mean compared to African or other developing countries. I meant that the poor in America is more extremely prevalent then other developed countries, and the poor in America is a lot worse then in Europe.

 

Now for my correlation of poverty and crime rate. The more poverty a state has, the more crime will occur. Out of 8 countries the United States had the highest crime homicide rate of 5.5, while Germany and other European countries was around 0.9. Now you may say that is coincidence or whatever. However, if only one country had a low rate, I can see your argument, but 12 of the EU countries have a lower rate and are more socialist geared. When I mentioned dangerous I meant in terms of crime rate. This means something. Furthermore the United States is only 4% of the world's population, but contains one-quarter of the worlds entire prison population! The U.S. averages 685 prisoners per 100,00 people, compared to 87 in EU countries.

 

 In 2004, the wealthiest 25% of US households owned 87% ($43.6 trillion) of the country’s wealth, while the bottom quartile held no net wealth at all. The middle 50% of the country held 13% or $6.5 trillion of the total household net wealth. [The previous data are taken from analysis of the Survey of Consumer Finances (SCF) which over samples wealthy households. This over sampling more accurately represents the true wealth distribution (since most of the wealth is concentrated at the top)]. This data shows that the top 25% of American society holds on average a net wealth of $1,556,801 which is 33 times more than those of the lower middle class, or the 25th-50th percentile. In addition to unequal wealth distribution, it is also difficult for individuals in the lower income distributions to gain economic mobility which inhibits their ability to accumulate wealth. In 2006, children in the lowest 20% of the income distribution only had a 17% chance of making it to the upper 40% of the income distribution. In 2004, children in the lowest 20% of the wealth distribution had only a 7% chance to make it to the top wealth distribution. In other words, wealthy parents tend to produce wealthy children, and poor parents tend to produce poor children. The Panel Study of Income Dynamics shows how stratification is becoming worse and worse since 1984. The lowest percentile has become worse, and the highest percentile has become wealthier. The fifth percentile has dropped further into negative net worth, while the 90th percentile has gained over four hundred points within the last twenty-one years. This doesn't sound like a subjected class with no mobility? The word proletariat is still relevant.

 

You said "The Constitution guarantees equality of opportunity, not equality of income."

 

There is no more equal opportunity.  One tries to have a thriving self-owned store, and Walmart comes along and buys them out ( or any other corporate business), is  that equal opportunity? America is ruled buy the business elites; the corporate cultures. There is no chance nowadays to achieve the American dream and have that opportunity. Business is too strong and should be regulated more. Another example is with Thatcher Pharm. How is there equal opportunity? There is hardly anyway of getting a product out there, because the bigger businesses have more money and means of making sure there is no competition in their way. Is this the American Dream? You may tend to think that capitalism promotes the best products , however, it can also promote lethargy. Microsoft for example, their software remained the same year after year, because their was no competition till Apple. Sometimes the business with the better product will not be able to get their name out, because of the big corporate giants. There could be a better product, but if one does not have the money how can they get it out there? So instead we are stuck with the same old product with no innovation. 

 

You said "You pay no taxes and yet are comfortable advocating that others, hard working mothers and fathers, pay an undue burden in the name of fairness"

 

Now to answer this question. The hard working mothers and fathers have less tax to pay. It is the wealthy who will be taxed. The hard working mothers and fathers cannot even send their kids to college, while the kids of the wealthy have no idea what hard work is about, because they fell entitled; didn't work for anything. Kids in the 12 EU countries have their school paid for, even up to college. That might explain why an average European is more literate and more fluent in math and science then the average American. Wow, capitalism worked their. Yes, granted the growth would be tremendous of the few, but the majority of citizens would suffer from lack of knowledge and their best hope after high school is not going to be a college degree. It will be working a 9-5 job with barely any money to get by. The American Dream is lost, 1/3 of Americans do not believe in the dream anymore. The rich live in gated communities, while large sections of the population are left with decaying public infrastructure, declining incomes, and increased unemployment. Another note to say, is that people belong in a poverty situation because of choice is wrong and inconsiderate. Some put themselves in those situations granted, however, for others that is all they have known (gangs, single mother/father, born into a poverty circumstance, etc). Also not to mention inner-city schools, which don't help much to educate a youths mind. Someone in a poverty situation as a much harder time then someone who as attended a private school and has the means. You are a product of your environment and that  has been psychologically proven.

 

Also you say that with more government regulation, companies will move their business else where. I must say this is not true. Sixty-one of the 140 biggest companies on the Global Fortune 500 rankings are European, while only 50 are U.S.. Companies will move their business to where the economy is the most stable. Also the EU eclipsed the U.S. GDP, before the market meltdown, at 19.5 trillion, this made it one of the worlds largest economy. That sure is a decaying culture for you. Also the EU would still be growing if it wasn't for the debt the European banks bought from the United States, which turned out to lose value, which hurt their economy. The matter of fact is Europe will(when they get out of their economic situation)  be a huge contender in term of economic powers, not a decaying culture. You also claim that with a more government driven economy innovation would go down. However, Germany, which has more socialized agendas then the United States,  is recognized as a scientific and technological leader in several fields. German cars are top worldwide. They are the world's market leader in eighteen of thirty-eight technical branches of machinery and plant manufacturing. Also The EU has more ethical driven policies when it come to scientific research, so their quickness is lacking, which is not necessarily a bad thing. EU citizens prefer to have science delayed for the protection of animal rights and so on.

 

You said "I am happy for the filthy rich. They invent, innovate, and employ. They raise my standard of living and the standard of living of my brothers and sisters worldwide."

 

I am glad you like to think your standard of living (and by this I am assuming you mean quality of life) is so high while Europeans are so low. Here are some quick facts. In the EU there are approx. 322 physicians per 100,00 people, where in the United States it is only 279. Furthermore, the United States ranks 26th among the industrial nations in infant mortality. This is well below the EU average. The average life span in the developed countries of the EU is now 78.01 compared to 76.9 in the U.S. Europe is the future. Further more, a measure done by the Human Development Index ranks America only 15th in terms of standard of living. Some countries ranked above America are France,Denmark, The Netherlands, and Ireland; all EU countries. Also to note, the countries listed are still growing, while the U.S. has remained neutral. The poor Americans wish they could have the benefits that "socialist" Europe has. What luxuries do the poor in America have, it doesn't make sense; explain this logic? See I thought the poor in America work minimal wage jobs,  live in violent crime ridden neighborhoods, have little or no access to health insurance, live on 5,000 a year, poor education opportunities( as mentioned several times), and so on.  Also European life is more clustered in cities. They don't have the space that we Americans enjoy, because there simply is not the room. Anyone living in a big city will pay rent and not have the same access to the things suburban Americas have, with less space cost raises. You are generalizing to much between Europeans and Americans. To compare in a better way is to observe Americans living in big cities with Europeans, this will be a better measure. 

 

Americans are so engrossed in autonomy as being true freedom, whereas European find it in embodiment . Europeans value more for the community then themselves. For Americans wealth comes exclusivity. One is self-reliant and like unto an island, all to oneself. Europeans value belonging, not belongings. So they don't have five cars and two plasma screen TVs. Yet, they are able to have enough money for food, give their child a proper education, have financial security, and so forth.  European culture is a life of simplicity that Americans can't understand, because of entrapment in material objects to give true happiness. Also European life is more clustered in cities. They don't have the space that we Americans enjoy, because there simply is not the room. Anyone living in a big city will pay rent and not have the same access to the things suburban Americans have; with less space cost raises. You are generalizing to much between Europeans and Americans. To compare in a better way is to observe Americans living in cities with Europeans, this will be a better measure. 

 

Last matter of clarification. When I talked about tax breaks being an axiom. I went on to explain why it was invalid thinking. "When the economy is struggling people are very hesitant to spend. One could give tax breaks, but what if very few people spend and invest it on the economy? A stimulus accounts for this variable, and gives money directly to business and government to invest. Government can use the money for infrastructure of a state, and by doing so create jobs." When I mentioned "what if very few people spend it on the economy" I was showing why this thinking is wrong logic. In another-words disproving the axiom. Twisting my words around is not going to help, I know what I said.

 

Now for the stimulus and why it is better. You mention above that Barack Obama as increased debt just like Reagan. Yes, this is true, however, Reagan was not in a dire economic situation like Obama is. Obama is raising the debt to get us out of our poor economic situation. How else can you stimulate growth? You can give tax breaks, but this gives no power to the government, who should have power. When one gives tax-breaks we are solely relying on businesses to get us out. As I recall the banks over lending (which are businesses) put us in this problem. Also by creating inflation, which Obama is essentially doing, will lower currency value, which in turn will promote more growth through exporting. Where do you think China is getting its revenue? It's called trade and lots of it. They are exporting huge amounts of products, which in turn is creating growth. Why do you think China is resistant to raising their currency value? Its because their exports will not be has cheap. Essentially, Obama by creating inflation is doing the opposite. Lower the value of currency to promote exports, which in turn will bring in revenue, which in turn will feed back into the economy, which in turn will stimulate growth. The EU is also doing the same, but in a little different ways. The main point is both the U.S. and EU are promoting stimulus concepts, because they work. In addition, the stimulus helped save the U of U from talking massive budget cuts, and yes massive. If there was no stimulus, the U would be lowing admittance, cutting classes, and jobs. I don't want to take three hour classes which I have no interest in, who would? The stimulus also prevented tuition rates from going up a colossal  amount. Tuition will still be raised by 9%, but not as much as it would if there was no stimulus helping, which would have been 42%! With your idea of no stimulus, students of the U would be paying outrageous sums of money, and classes would be cut more then they are now, in the name of accountability... 

 

With clarification on GM, if their product is in such high demand. Then how come they needed a bailout? GM was not selling anything because their trucks and gas guzzling cars were not bought. They were outsold buy other car companies. Also what about competition? We need to be competitive with other businesses, more competition the lower the price. What about jobs, if we let GM and other businesses fall, where goes the job? Thousands will be unemployed, can we afford that? Many dealers will be put out of business if GM falls, because their hunk of metal will be collecting rust in the lot. A consumer would not in the right mind buy a car, whose company is bankrupt; there is no consumer confidence. We need to keep all businesses afloat, so they can produce more jobs and be competitive, including the car dealerships who create many jobs. This is especially true with AIG. If we would let AIG fall, it will cause of ripple effect across the entire nation and even the world. AIG insures 180,000 entities which employs around 106 million people in the U.S. alone. It would be unbearable for the economy if it failed or any other major corporate businesses. Everything is connected in the business world. Do you see where I am going with this? It would be a domino effect that would hurt and destroy businesses and jobs. Were is economic growth with no jobs, how can there be? The fact of globalization and interconnectedness is the reasons for no accountability. You can let them fall, but it will hurt everyone; not just them. 

 

 Regarding the Great Depression argument, FDR refused to run up the deficits that ending the depression required. Only when the federal government imposed rationing, recruited 6 million defense workers, drafted 6 million soldiers, and ran massive deficits to fight World War II did the Great Depression finally end. "Massive deficits to fight WW2 did the Great Depression finally end." Massive deficits brought us out of the G.D. FDR prolonged the G.D. by not willing to raise debt. 

 

Touching on the topic of Reagan, I disagree with Reagan because he raised debt when there was no need to. During Reagan's term we were not facing a recession like we are today. He raised debt when there was no need to. Obama is raising debt, because that is the way out of an economic downturn. Just like mentioned above, debt is what got us out of the Great Depression. Every developed country is having their own version of a stimulus, because it works. Tax breaks in truth is only a theory and has not been implemented into an economic downturn successfully. I can't see in reality how it works. Most people are scarred to spend money while the economy when it is tanking. Give them tax breaks and will they truly spend it. With this philosophy, you concentrate growth in the middle class and above. This will in turn alienate the poor population, who are struggling and have no money. You give money to governments to invest and create jobs. Also you save business from falling, so they can create jobs and revenue.

 

Just for your own comfort, America will never become socialized like Europe. Americans mentality is different from that of Europeans. Like you have stated in your last email, the U.S. constitution will never allow extreme amounts of government. America will always be a capitalist economy, maybe more regulated and more driven by the lower classes, but still on the essence capitalist. It seems, from reading your last email, that you are worried that a socialized agenda will be the new norm for America, but it won't. Obama's plan for healthcare is not going to be government run;  it will still be privatized. His plan is to have many insurance companies compete for health care plans, by doing this. It will create more competition and the price will be more reasonable. I wanted to clarify this, because I could sense you thought we were heading the direction of Europe ( and sorry for the extended talks on Europe listed above). Regarding the stimulus, this is only temporary, until we are out of the recession. There will nonetheless, be more regulation of business, but not in the socialism sense. Privatized agendas will remain and even though there will be little changes (which in all honesty are needed) including increased taxes on the wealthy and more concentration on the poor; free market will still exist. This is not say however, that I am in complete support of this economic philosophy(capitalism). Hence, why I only prefer Obama over the other guy(McCain). I like the set up of Europe, a more harmonious and collective system. I like the fact of low counts of poverty and more equalized distribution of wealth. I like the fact that attaining a valuable education is more of a reality instead of an illusion, and leisure time is more easy to come by(albeit lack of material possessions). In my opinion the economic and political setup of Europe is very progressive and I agree with it.

 

Thanks-James

NOTE: Forgive the jumpiness of my response. Finals are coming soon, so I have not had the time to give you a fluid response. 

 

My Final Argument Interspersed (Remember, the liberal argument comes from the U student)

 

Good to hear from you again. I agree with you on staying more centered on our original topic. However, I must respond to some of the things you said. First and I want to get this clear. You probably think I have professors at the U telling me what to believe regarding politics.  

 

-Not exactly, I just think you aren't reading very widely and from what I know of the public school system, haven't been for most of your young life.

 

 This simply is not true, my beliefs are my own because I have agreed with the philosophy of a collective whole growing together.  

 

- I don't dispute that they are your beliefs. You are the one professing them. I'm just pretty confident that you haven't been exposed to the alternative universe of conservatism which is more rational.... and sane. Remember, I was once your age. It took a lot of discovery to find the true message. Believe me, your university, and the culture around you, is insulation from what is right and true.

 

 I agree with less poor even if it means sacrificing in some ways.  

 

-sacrifice away. No one is stopping you. what I fail to understand is the mindset that you have. forcing people like me to be charitable. Governments are instituted to protect my rights against forcible seizure of private property, but you prefer to use it coercively. Read The Law, Frederic Bastiat

 

 You claim that Europe is doing bad. Yet their poverty rate is nowhere near the rate of America. When I meant extreme poverty, I did not mean compared to African or other developing countries . 

 

-Then don't use the word extreme. Words have value. Extreme means extreme. It does not change meaning with context.

 

I meant that the poor in America is more extremely prevalent then other developed countries, and the poor in America is a lot worse then in Europe. 

 

-This simply is not true. The poor in America enjoy a far more comfortable lifestyle than the poor in Europe. The middle class is the same way. Per capita GDP in the US, applying Purchasing Power Parity, is around $45,000 per year. The EU on the other hand, if you exclude Luxembourg which absolutely skews the stat, has a per capita GDP (PPP) of $22,000 per year. You simply cannot make this case. Middleclass Euros don't even own property. Their living quarters on average are a percentage of that of Americans. They are relegated to public transportation.... etc.. No freedom.

 

Now for my correlation of poverty and crime rate. The more poverty a state has, the more crime will occur.  

 

-Correlation does not prove causation. That poverty causes crime is a myth. The high crime rate can be attributed to fatherless households and lack of character. Statistically, to avoid poverty, all one has to do is graduate highschool, marry before having children, and produce any children after the age of twenty. 

 

Out of 8 countries the United States had the highest crime homicide rate of 5.5, while Germany and other European countries was around 0.9. Now you may say that is coincidence or whatever. However, if only one country had a low rate, I can see your argument, but 12 of the EU countries have a lower rate and are more socialist geared. When I mentioned dangerous I meant in terms of crime rate. This means something. Furthermore the United States is only 4% of the world's population, but contains one-quarter of the worlds entire prison population! The U.S. averages 685 prisoners per 100,00 people, compared to 87 in EU countries. 

 

-The Bureau of Justice Statistics paints a complete picture. Homicide rates are high because of black on black crime. Like I said, poverty doesn't cause it, family disorganization and a failure of the culture to meet critical Judeo-Christian expectations does. Much of this stems from the liberal policies of the 1960's and 1970's, no fault divorce and irresponsible welfare policies which made the father of the black family obsolete. Read any number of books on the subject. Slouching toward Gomorrah and The Dream and the Nightmare are the two best I've read so far. Incarceration is high because we take crime seriously. Read the report.)

 

 In 2004, the wealthiest 25% of US households owned 87% ($43.6 trillion) of the country’s wealth, while the bottom quartile held no net wealth at all. The middle 50% of the country held 13% or $6.5 trillion of the total household net wealth. [The previous data are taken from analysis of the Survey of Consumer Finances (SCF) which over samples wealthy households. This over sampling more accurately represents the true wealth distribution (since most of the wealth is concentrated at the top)]. This data shows that the top 25% of American society holds on average a net wealth of $1,556,801 which is 33 times more than those of the lower middle class, or the 25th-50th percentile. In addition to unequal wealth distribution, it is also difficult for individuals in the lower income distributions to gain economic mobility which inhibits their ability to accumulate wealth. In 2006, children in the lowest 20% of the income distribution only had a 17% chance of making it to the upper 40% of the income distribution. In 2004, children in the lowest 20% of the wealth distribution had only a 7% chance to make it to the top wealth distribution. In other words, wealthy parents tend to produce wealthy children, and poor parents tend to produce poor children. The Panel Study of Income Dynamics shows how stratification is becoming worse and worse since 1984. The lowest percentile has become worse, and the highest percentile has become wealthier. The fifth percentile has dropped further into negative net worth, while the 90th percentile has gained over four hundred points within the last twenty-one years.  

 

-You copied all of this from Wikipedia without citing it or even putting quotes around it. Some would think you came up with all of this on your own. Is that ethical? The Panel Study of Income Dynamics's neutrality, as Wikipedia notes, is disputed. In a separate entry summary titled "Changes in Wealth, 1989-2001" it states that much of the disparity in income results from the large population of Boomers who are at their prime earnings age. It also states that the wealth and economic health of the entire country has increased. "When observing the changes in the wealth among American households, one can note an increase in wealthier individuals and a decrease in the number of poor households... Overall the percentage of households with a negative net worth (more debt than assets) declined from 9.5% in 1989 to 4.1% in 2001." "...more and more households have achieved comfortable levels of wealth.^[1] Zhu Xiao Di (2004) notes that household wealth usually peaks around families headed by people in their 50s, and as a result, the baby boomer generation reached this age range at the time of the analysis." These are positive trends. Long term, where will the wealth go when the baby boomers are gone? In a capitalist society, we should see a boom in growth of the free market. Business expansion, jobs, new technology, new industries. In a quasi socialist economy, more bureaucracy, corruption, and a stagnant economy.

 

This doesn't sound like a subjected class with no mobility? The word proletariat is still relevant. You said “The Constitution guarantees equality of opportunity, not equality of income.”

 

There is no more equal opportunity.  One tries to have a thriving self-owned store, and Walmart comes along and buys them out ( or any other corporate business), is  that equal opportunity?  

 

-Yeah... look up 'opportunity'. Of all of the responsibilities you could assign to government, protecting lazy Joe's trash hauling business from competitors is not one of them. 

 

America is ruled buy the business elites; the corporate cultures. There is no chance nowadays to achieve the American dream and have that opportunity.  

 

-"Ruled by business elites"? America is a free society. Business elites operate in a free enterprise system. What part of that don't you understand? You would rather the country be 'ruled' by Political Elites? At least the business men create jobs and are responsible for the products and services they offer. Their capital fuels growth and innovation. What do political elites create but more law, more restrictions on private enterprise, and corrupt syndicates. Long live PRIVATE ENTERPRISE. 

 

Business is too strong and should be regulated more. Another example is with Thatcher Pharm. How is there equal opportunity? There is hardly anyway of getting a product out there, because the bigger businesses have more money and means of making sure there is no competition in their way.  

 

-I don't think you fully understand 'business'. What you do on a daily basis is what? Your business. Yeah, that's right. You want your neighbor in your business? James, honestly, this is a ridiculous statement. What do the other companies do to keep Thatcher down? There are, ultimately,  only two things that can prevent a company in a free market from growing; the executive philosophy and government regulation.  

 

Is this the American Dream? You may tend to think that capitalism promotes the best products 

 

-Capitalism doesn't promote anything. Capitalism supports innovation and efficient resource allocation. Are you saying that a government bureaucracy will do a better job of identifying needed technology and promoting the most successful products in an economy? Government can't even successfully run a postal service or a division of motor vehicles. Your form of government failed to feed the proletariat after its revolution.  They failed to maintain industrial centers and to develop needed technology. The USSR was a failure and that seems to me to be your ideal model? 

 

however, it can also promote lethargy. Microsoft for example, their software remained the same year after year, because their was no competition till Apple. Sometimes the business with the better product will not be able to get their name out, because of the big corporate giants.  

 

-You should study the history of the development of Apple and Microsoft. Steven Jobs had a workable OS before Gates, but didn't have the vision to get it to market. Or maybe it was lethargy, you tell me. What would your solution be, take profits from Microsoft to fund Apple's effort? That would be both unethical and slow the progress of both.

 

There could be a better product, but if one does not have the money how can they get it out there?  

 

-It is your opinion that Apple is a better  product. Because of the vision of Gates, the PC revolutionized the last four decades. Should we have waited longer for Jobs to get his crap together? This is basic econ. Eighth grade stuff. You borrow the money in the financial marketplace. That is capitalism. You work with others with capital who have an interest in your product's success. You form partnerships and relationships. Free and voluntary relationships for the purpose of offering goods and services.

 

So instead we are stuck with the same old product with no innovation.  

 

-There has never in history been more tech innovation than in the last 40 years. How will you explain your philosophy that the government is more creative and innovative than private industry? Marx laid the groundwork. Where has it worked?

 

You said “You pay no taxes and yet are comfortable advocating that others, hard working mothers and fathers, pay an undue burden in the name of fairness” Now to answer this question. The hard working mothers and fathers have less tax to pay. It is the wealthy who will be taxed.  

 

-Obama's policies will tax everyone. If you'd like we can focus on this topic specifically. I'd like that. 

 

The hard working mothers and fathers cannot even send their kids to college 

 

-You assume that the 'wealthy' do not work hard? I would say often, they work harder than most.

 

while the kids of the wealthy have no idea what hard work is about, because they fell entitled; didn't work for anything.  Kids in the 12 EU countries have their school paid for, even up to college.

 

-The US taxpayer pays for the education for all US kids up to college. Just like the "Kids in the 12 EU countries". 

 

That might explain why an average European is more literate and more fluent in math and science then the average American.  

 

-(Cite your source on please. I'm not buying it. And don't say, "My poli-sci professor." LOL)

 

Wow, capitalism worked their.  

 

-I agree that the US education system is failing. That is not a reflection on capitalism, however, but on poor management by the government. A capitalist system encourages competition. The success of the private sector in education is reflected in the ability of private and charter schools, and voucher programs to significantly outperform their public counterparts. 

 

Yes, granted the growth would be tremendous of the few, but the majority of citizens would suffer from lack of knowledge and their best hope after high school is not going to be a college degree.  

 

-Once again, I will refer you to college enrollment statistics. Post secondary institutions are growing and their tuitions keep climbing. You can blame government for the lack of affordability in higher education. 

 

It will be working a 9-5 job with barely any money to get by. The American Dream is lost, 1/3 of Americans do not believe in the dream anymore.

 

-That third have never believed in it. They are the entitlement third. They are they who think it is everyone elses (government's) obligation to provide them a living.

 

The rich live in gated communities, while large sections of the population are left with decaying public infrastructure, declining incomes, and increased unemployment.  Another note to say, is that people belong in a poverty situation because of choice is wrong and inconsiderate.  

 

-I assure you, I have considered the situation intently. I would assert that you are inconsiderate. I would assert that you have spent little time reading on the theories which outline poverty's true causes and affects.  

 

Some put themselves in those situations granted, however, for others that is all they have known (gangs, single mother/father, born into a poverty circumstance, etc).  Also not to mention inner-city schools, which don't help much to educate a youths mind. Someone in a poverty situation as a much harder time then someone who as attended a private school and has the means.  

 

-At the core of poverty is the disregard for a cohesive family, education, and elemental Judeo-Christian morals and ethic. 

 

You are a product of your environment and that  has been psychologically proven. 

 

-Your notion of the American dream is skewed. The American dream is above all, the ability to live free of government intrusion and oppression. The correct interpretation includes the idea of equal justice, free speech, free enterprise, and free association. It includes an objective and constructionist view of the Constitution which was intended to put restrictions on socialist thinkers like you who advocate the usurpation of my private property and the private property of free people. You don't even see the inconsistency in your argument. You talk about providing some with the American dream by taking it from others. That is completely incongruent. Conservatives are mean aren't they? They just hate the poor don't they? James, I agree that people are a product of their environment and that children born into poverty are likely to be impoverished. But it is by their values. They've rejected the value of marriage and family, hard work, clean and virtuous living. These will lift anyone out of poverty. We need to reinforce these as the key. Bill Cosby knows it. All black conservative scholars know it. You should look up John McWhorter and Thomas Sowell. You will find their arguments very persuasive.

 

Also you say that with more government regulation, companies will move their business else where. I must say this is not true. 

 

-Let me rephrase that. In a free economy, one where the government doesn't provide protection against competition, a business that is overly burdened by taxation will relocate to maximize their profit taking. In an economy which is highly regulated by the government, large concerns often benefit from the regulation, presiding over favorable monopolies.  

 

Sixty-one of the 140 biggest companies on the Global Fortune 500 rankings are European, while only 50 are U.S..

 

-So you are cherry picking from the report? It is the Fortune 500, not 140. What about the top ten? Top 25? Top 50? Out of all 500 how do we fair? I would say better than the EU. Regardless, the Fortune 500 EU companies do well because, like I said, there are very strong restrictions to competition. A better statistic that will reflect the strength of a society's business climate might be to show how many small cap companies exist in each of the two compared, and how successful they are. Do that for me will ya?  

 

are USCompanies will move their business to where the economy is the most stable. 

 

-You mean where the government protects them from competition? Like in France or Germany where government regulation is so stringent it is virtually impossible to start your own business.

 

Also the EU eclipsed the U.S. GDP, before the market meltdown, at 19.5 trillion, this made it one of the worlds largest economy. That sure is a decaying culture for you.

 

-Culture and economy are two different things. The fact that there are successful elite monopolies acting globally from an EU position does not reflect on the health of the culture. Europeans are not actively persuing policies whereby their population is sustained. Only through immigration, particularly muslim 3rd world labor, is their workforce and economy sustaining their government pension and entitlement programs. The growing muslim populations in Europe will soon become majorities there. Will there a beloved Italy, France, England, Spain in 20 to 30 years? With that, what happens to the legacy of western philosophy and thought?

 

The GDP is not a measurement of the culture.  Also the EU would still be growing if it wasn't for the debt the European banks bought from the United States, which turned out to lose value, which hurt their economy. The matter of fact is Europe will(when they get out of their economic situation)  be a huge contender in term of economic powers, not a decaying culture. You also claim that with a more government driven economy innovation would go down. However, Germany, which has more socialized agendas then the United States,  is recognized as a scientific and technological leader in several fields. German cars are top worldwide. 

 

-Top what? How does BMW's or Mercedes's sales compare to GM and Ford globally? How many people do they employ compared to GM, Ford? These are elite market vehicles. Careful James, while you're decrying the poor you may not want to reveal your true identity as an elitist ideologue.

 

They are the world's market leader in eighteen of thirty-eight technical branches of machinery and plant manufacturing. 

 

-Cite your study please so I can review it. 

 

Also The EU has more ethical driven policies when it come to scientific research, so their quickness is lacking, which is not necessarily a bad thing. 

 

-Unless someone in your family is dying of cancer. What is ethical about putting flowers and snails before people?

 

EU citizens prefer to have science delayed for the protection of animal rights and so on. 

 

-Yeah, they've gone so far away from God and the love of human life that they would rather gramps take a dirt nap than have to submit Chuck the hamster to any clinical testing. (See above where I talk about them destroying their culture.

 

You said “I am happy for the filthy rich. They invent, innovate, and employ. They raise my standard of living and the standard of living of my brothers and sisters worldwide.” I am glad you like to think your standard of living (and by this I am assuming you mean quality of life) is so high while Europeans are so low. Here are some quick facts. In the EU there are approx. 322 physicians per 100,00 people, where in the United States it is only 279. Furthermore, the United States ranks 26th among the industrial nations in infant mortality. This is well below the EU average. The average life span in the developed countries of the EU is now 78.01 compared to 76.9 in the U.S. 

 

-So we eat a bunch of crap and sit around a little more. We own cars and don't have to walk everywhere. Is it a bad thing? Maybe so. Do you want the government telling you what to eat? When and where you can drive? hmm. .

 

Europe is the future. Further more, a measure done by the Human Development Index ranks America only 15th in terms of standard of living. Some countries ranked above America are France,Denmark, The Netherlands, and Ireland; all EU countries. 

 

-Since the UN seeks to level the world economy with American tax dollars, I'm not fully confident in this study. However, giving it the benefit of the doubt, you can see that the most successful countries on this list are radically homogenized. That means they don't entertain the diversity of races, cultures, and ethnicities which the US "enjoy's". This has an overwhelming influence on life expectancy, literacy, and income. Remember though that by applying the PPP (Purchasing Power Parity) to the per capita GDP, the US kicks Europe's hiney. (US $44k per capita income vs. EU (excluding Luxembourg's, which is unusually high at $70k), comes in at a measily $22k.) That's how I mark standard of living.

 

Also to note, the countries listed are still growing, while the U.S. has remained neutral. 

 

-US GDP growth was consistent between 3 and 5% since 1980. The EU 2% is a good year in the EU.

 

The poor Americans wish they could have the benefits that "socialist" Europe has. 

 

-You mean like free education, Medicaid and Medicare, welfare payments, food stamps?

 

What luxuries do the poor in America have, it doesn't make sense; explain this logic? See I thought the poor in America work minimal wage jobs,  live in violent crime ridden neighborhoods, have little or no access to health insurance,  live on 5,000 a year, poor education opportunities( as mentioned several times), and so on.  

 

-I just don't know what to say to you. People who can only make $5,000 per year need to be institutionalized not subsidized to continue their poor habits. Don't you see that?

 

Also European life is more clustered in cities. They don't have the space that we Americans enjoy, because there simply is not the room. Anyone living in a big city will pay rent and not have the same access to the things suburban Americas have, with less space cost raises. You are generalizing to much between Europeans and Americans. 

 

-Wait a minute, you just wrote 3 paragraphs comparing US and EU through nebulous UN issued statistical groupings and obscure rankings without considering the factors which lead to the results... and I'm generalizing too much?

 

To compare in a better way is to observe Americans living in big cities with Europeans, this will be a better measure. 

 

-I don't care about land area, population demographics, whatever. If Europe is so great, why do fewer Europeans have ownership of particular things which even the lowest classes in the US have ownership of? Homes, or condos if you will, multiple cars per family, quality living space, affordable utilities and gasoline, affordable and accessible products and services?

 

Americans are so engrossed in autonomy as being true freedom, 

 

-From Oxford dictionary (as EU as I could get): autonomy - freedom of action. How about that, 'freedom' is actually in the definition.  

 

whereas European find it in embodiment.  Europeans value more for the community then themselves. 

 

-Does this explain why Europeans are so charitable? LOL. Is that why their immigrant populations riot daily? I like how you have such expertise into the psyche of the European. Perhaps you can recommend one of your books on the subject?

 

For Americans wealth comes exclusivity. One is self-reliant and like unto an island, all to oneself. 

 

-Yeah, except for the daily exchange of ideas and the flow of money for goods and services, investments, capitalizations, etc.

 

Europeans value belonging, not belongings. 

 

-All well and good until you need some nukes to deter rogue nations, or want to take a quick trip down to Sam's Club to buy your kids a trampoline. 

 

So they don't have five cars and two plasma screen TVs. Yet, they are able to have enough money for food, give their child a proper education, have financial security, and so forth.  European culture is a life of simplicity that Americans can't understand, because of entrapment in material objects to give true happiness. 

 

-I assure you, most Americans understand the 'simple life' you embrace so heartily. Americans just chose to do better and if given the choice, many Europeans would also. Its so romantic to be untethered from modern convenience, until your government leaves you no choice but to be. You really ought to be careful when speaking for others. All this aside, American culture leaves it up to the individual to decide what is most desirous. If someone likes five cars and the 'entrapment of material objects', why is it any of your business to tell them that those arent' appropriate things to desire? Socialist thought runs contrary to liberty, freedom and autonomy.(This will be a recurring theme of mine, I can tell  

 

Also European life is more clustered in cities. They don't have the space that we Americans enjoy, because there simply is not the room. Anyone living in a big city will pay rent and not have the same access to the things suburban Americans have; with less space cost raises. You are generalizing to much between Europeans and Americans. To compare in a better way is to observe Americans living in cities with Europeans, this will be a better measure. Last matter of clarification. When I talked about tax breaks being an axiom. I went on to explain why it was invalid thinking. "When the economy is struggling people are very hesitant to spend. One could give tax breaks, but what if very few people spend and invest it on the economy? A stimulus accounts for this variable, and gives money directly to business and government to invest. Government can use the money for infrastructure of a state, and by doing so create jobs." When I mentioned "what if very few people spend it on the economy" I was showing why this thinking is wrong logic. In another-words disproving the axiom. Twisting my words around is not going to help, I know what I said.

 

-Sorry, wasn't intentional. Just misread what you were saying. Wasn't that clear. Anyway, what would people do with the extra money they got in their paycheck every week, if not spend it? Save it? What does savings do? Reinforce bank liquidity? Lower interest rates? Sounds like a positive trend to me? Identify for me potential fraud and corruption situations in this model? I can identify scores in yours:

 

Government can use the money for infrastructure of a state, and by doing so create jobs.

 

-You want to give states who, irresponsibly year after year, pile on huge deficits... you feel good giving them more money that you've created out of thin air... money that will come from someone who, right now, is not even old enough to vote on whether or not they think it is a good idea to do. I call that slavery. You have taxed an American civilian without their approval. That is taxation without representation. And yet you Dems could do it all day long.

 

Now for the stimulus and why it is better. You mention above that Barack Obama as increased debt just like Reagan. Yes, this is true, however, Reagan was not in a dire economic situation like Obama is. Obama is raising the debt to get us out of our poor economic situation. How else can you stimulate growth? You can give tax breaks, but this gives no power to the government, who should have power. When one gives tax-breaks we are solely relying on businesses to get us out. As I recall the banks over lending (which are businesses) put us in this problem. Also by creating inflation, which Obama is essentially doing, will lower currency value, which in turn will promote more growth through exporting. Where do you think China is getting its revenue? It's called trade and lots of it. They are exporting huge amounts of products, which in turn is creating growth. Why do you think China is resistant to raising their currency value? Its because their exports will not be has cheap. Essentially, Obama by creating inflation is doing the opposite. Lower the value of currency to promote exports, which in turn will bring in revenue, which in turn will feed back into the economy, which in turn will stimulate growth. The EU is also doing the same, but in a little different ways. The main point is both the U.S. and EU are promoting stimulus concepts, because they work. In addition, the stimulus helped save the U of U from talking massive budget cuts, and yes massive. If there was no stimulus, the U would be lowing admittance, cutting classes, and jobs. I don't want to take three hour classes which I have no interest in, who would? The stimulus also prevented tuition rates from going up a colossal  amount. Tuition will still be raised by 9%, but not as much as it would if there was no stimulus helping, which would have been 42%! With your idea of no stimulus, students of the U would be paying outrageous sums of money, and classes would be cut more then they are now, in the name of accountability... 

 

-I am not arguing that a stimulus might not have been necessary. What I am arguing is that Obamas stimulus is not good for the country... or rather, you are supposed to convince me that it is. So far you've only spoken in generalities, "… investment by government injects income, which results in more spending in the general economy,...". However, you've failed to underline specifically why his stimulus is a good idea. A stimulus should stimulate, not be an omnibus of spending on liberal programs that realise no potential until after 3 to 5 years or more. That is not stimulus. Stimulating exports through a week dollar needs to be measured with the rising prices of consumer goods here in this country. $1,000 actually worth $1,000 is better than $1,000 that is worth $650. Hurting the strength of the currency, hurts purchasing power and limits choices. Liberty, freedom and democracy are about expanding choices. I feel for you. I'm sure it would be like the end of the world for you to take classes which you have no interest in taking. I'm humbled that the U has accepted my hard earned money so that you have all the choice in education you could ever want. I'm glad the students at the U don't have to pay for their school and can rely on my kids to pay for their school for them. I can only hope that they are able to save enough for their own educations.

 

With clarification on GM, if their product is in such high demand. Then how come they needed a bailout? 

 

-They don't need a bailout. They need to get rid of the unions which are bleeding them dry. They aren't a car company, they are a pension fund. They are paying 3 people who no longer work for them for every current employee. Union organization is killing the auto industry.

 

GM was not selling anything because their trucks and gas guzzling cars were not bought. They were outsold buy other car companies. 

 

-Only Toyota my friend, whose own full size truck is selling quite well by the way. Must be a market for trucks somewhere.

 

Also what about competition? We need to be competitive with other businesses, more competition the lower the price. 

 

-Now your a proponent of competition? So you want Barack to "poof" make GM more competitive at the same time he is mandating higher fuel standards, asking no concessions from the unions, and defining which cars to make (compact hybrids) when the market doesn't support it? Now that is a formula for success !!

 

What about jobs, if we let GM and other businesses fall, where goes the job? Thousands will be unemployed, can we afford that? Many dealers will be put out of business if GM falls, because their hunk of metal will be collecting rust in the lot. A consumer would not in the right mind buy a car, whose company is bankrupt; there is no consumer confidence. We need to keep all businesses afloat, so they can produce more jobs and be competitive, including the car dealerships who create many jobs. This is especially true with AIG. If we would let AIG fall, it will cause of ripple effect across the entire nation and even the world. AIG insures 180,000 entities which employs around 106 million people in the U.S. alone. It would be unbearable for the economy if it failed or any other major corporate businesses. Everything is connected in the business world. Do you see where I am going with this? It would be a domino effect that would hurt and destroy businesses and jobs. Were is economic growth with no jobs, how can there be? The fact of globalization and interconnectedness is the reasons for no accountability. You can let them fall, but it will hurt everyone; not just them. 

 

-No pain no gain. Better that we adults take responsibility for our poor management than pawn it off on our kids who had nothing to do with it.

 

 Regarding the Great Depression argument, FDR refused to run up the deficits that ending the depression required. Only when the federal government imposed rationing, recruited 6 million defense workers, drafted 6 million soldiers, and ran massive deficits to fight World War II did the Great Depression finally end. "Massive deficits to fight WW2 did the Great Depression finally end." Massive deficits brought us out of the G.D. FDR prolonged the G.D. by not willing to raise debt. 

 

-I agree with a lot of this, although it was FDR's inconsistency which stalled the recovery. Making firm policy decisions and defining the new rules in the financial markets would have brought confidence back and hastened the recovery. It should not have taken as long as it did. I want you to know that I am not opposed to a stimulus plan. I fully understand the dangers of allowing influential companies to fail. My initial question to you was how will Barack's stimulus help the economy? Especially when their is so much pork in it? There is so much in it that would not be considered stimulus. It is, for all intents and purposes, a Democratic wish list of programs which belong in the budget proposal. He is using fear to further the democratic agenda under false pretense and is not being honest. I want an honest President.

 

Touching on the topic of Reagan, I disagree with Reagan because he raised debt when there was no need to. During Reagan's term we were not facing a recession like we are today. He raised debt when there was no need to. Obama is raising debt, because that is the way out of an economic downturn. Just like mentioned above, debt is what got us out of the Great Depression. 

 

-Oh, I see, you're not quite up to the 70's and 80's in your American history class yet. The economy that Reagan inherited was the worse since the Great Depression. It was worse than what Obama inherited, but may not be worse by the time Obama is done. I don't feel like I need to give you a history of Reagan's first years in office. Look it up for yourself.

 

Every developed country is having their own version of a stimulus, because it works. Tax breaks in truth is only a theory and has not been implemented into an economic downturn successfully. 

 

-This is the most outrageous statement you've made so far. Both Reagan and Bush II implemented successful tax break strategies. Bush cut taxes on the wealthy so much that they went from paying 65% of the total US tax burden to over 70%.

 

I can't see in reality how it works. 

 

-A quick glance at the Laffer Curve will help you out.

 

Most people are scarred to spend money while the economy when it is tanking. Give them tax breaks and will they truly spend it. 

 

-What would happen to it otherwise? Their gonna put it under their mattresses? Even if they save it, they will be increasing bank deposits which lowers interest rates naturally and encourages lending. The theory behind Obamas stimulus is to restore confidence in lending. Instead of speculating that it won't work, give me a scenario?

 

With this philosophy, you concentrate growth in the middle class and above. This will in turn alienate the poor population, who are struggling and have no money. 

 

-A tax break for the rich will actually help the poor before the rich, because the rich will spend the extra on business expansion, including primarily, job creation. Ofcourse, if you are unwilling to work, you should be in an institution.

 

You give money to governments to invest and create jobs. Also you save business from falling, so they can create jobs and revenue. Just for your own comfort, America will never become socialized like Europe. Americans mentality is different from that of Europeans. Like you have stated in your last email, the U.S. constitution will never allow extreme amounts of government. America will always be a capitalist economy, maybe more regulated and more driven by the lower classes, but still on the essence capitalist. It seems, from reading your last email, that you are worried that a socialized agenda will be the new norm for America, but it won't. Obama's plan for healthcare is not going to be government run;  it will still be privatized. His plan is to have many insurance companies compete for health care plans, by doing this. It will create more competition and the price will be more reasonable. 

 

-I see... No, wait, I don't see. You are saying that Obama wants to use his federal power to force health insurance companies to compete in what is already a free and competitive market. So he'll implement rules that will favor particular companies? ... He'll say, "you must compete at the most competitive level?",...He'll set prices which will force many insurers to leave the industry thus creating a monopoly... one insurer providing for the whole country... Like medicaid? One of the worst run programs in the federal government.  

 

I wanted to clarify this, because I could sense you thought we were heading the direction of Europe 

 

-I am so relieved. Boy, thanks James. In reality, socialism moves in steps. It just so happens this is the largest step this country has taken since the Lyndon Johnson. With every step, it erodes the Constitution's promise of equality before the law. You say that the "constitution will never allow extreme amounts of government", but I would say, the Constitution can't prevent the march of socialism. The constitution is only a piece of paper. It is the idea behind the Constitution only, that can protect the country from this form of immoral government. The explanation of that idea is being denied in public schools, the media, and at the University. I would hope you would take some time to read some other things besides what your school is providing.

 

( and sorry for the extended talks on Europe listed above). Regarding the stimulus, this is only temporary, until we are out of the recession. There will nonetheless, be more regulation of business, but not in the socialism sense. Privatized agendas will remain and even though there will be little changes (which in all honesty are needed) including increased taxes on the wealthy and more concentration on the poor; free market will still exist. This is not say however, that I am in complete support of this economic philosophy(capitalism). Hence, why I only prefer Obama over the other guy(McCain). I like the set up of Europe, a more harmonious and collective system. I like the fact of low counts of poverty and more equalized distribution of wealth. I like the fact that attaining a valuable education is more of a reality instead of an illusion, and leisure time is more easy to come by(albeit lack of material possessions). In my opinion the economic and political setup of Europe is very progressive and I agree with it.

 

-I am glad to finally get this off to you. Please forgive the sarcasm in places, I mean no harm. I can be harsh sometimes, but understand that I am passionate. I would really like to move the discussion at this point to ethics and your justification for your opinions and ideas. For instance, it is my contention that governments by the people are instituted to protect citizens from the intrusions of their neighbors. They are instituted to protect freedoms, liberties and properties. How do you justify using the government in a coercive way? How do you rebut these words from the great economic thinker F.A. Hayek that say true individualism "... can see no reason for trying to make people equal as distinct from treating them equally. While individualism is profoundly opposed to all proscriptive privilege, to all protection, by law or force, of any rights not based on rules equally applicable to all persons, it also denies the government the right to limit what the able or fortunate may achieve. It is equally opposed to any rigid limitation of the position individuals may achieve, whether this power is used to perpetuate inequality or to create equality. Its main principle is that no man or group of men should have power to decide what another man's status ought to be, and it regards this as a condition of freedom so essential that it must not be sacrificed to the gratification of our sense of justice or of our envy."