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Job Creators
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mrplunkey
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That certainly not TED-talk worthy. He's using a tired old argument over job creation via investment vs. consumerism.
If consumerism worked, I could get this economy started by just running up and down the street with a baseball bat breaking things.
The only thing that actually makes people richer is productivity gains. How do you achieve those productivity gains?
1) Either innovate (invent another Internet, computer, cell phone, movable type press, automobile)
2) Work people harder (which unfortunately is the go-to method during times like these)
3) Invest (buy higher capacity equipment, modernize facilities, automate)
But Hanaur made one good point: Rich people don't consume 100's or 1,000's of times more than their lower-income counterparts. Instead, they take the excess and invest it. He thought he was making a point about consumers having more to spend, but he was really bolstering the point that high-wealth people invest their excess -- otherwise what would they do with it? Depositing it in a bank is an investment (interest income). Buying stocks or bonds is an investment as well.
If consumerism worked, I could get this economy started by just running up and down the street with a baseball bat breaking things.
The only thing that actually makes people richer is productivity gains. How do you achieve those productivity gains?
1) Either innovate (invent another Internet, computer, cell phone, movable type press, automobile)
2) Work people harder (which unfortunately is the go-to method during times like these)
3) Invest (buy higher capacity equipment, modernize facilities, automate)
But Hanaur made one good point: Rich people don't consume 100's or 1,000's of times more than their lower-income counterparts. Instead, they take the excess and invest it. He thought he was making a point about consumers having more to spend, but he was really bolstering the point that high-wealth people invest their excess -- otherwise what would they do with it? Depositing it in a bank is an investment (interest income). Buying stocks or bonds is an investment as well.
gjohnson5
New member
Rich people don't create the most jobs. This is a well documented fact. The number one job creator is startup businesses. Plain and simple. People who found starts are NOT THE TOP 1%$
*edit*
SO I agree with the video that we are cutting taxes for people who are cutting jobs not creating them
*edit*
*edit*
SO I agree with the video that we are cutting taxes for people who are cutting jobs not creating them
*edit*
mrplunkey
New member
Rich people don't create the most jobs. This is a well documented fact. The number one job creator is startup businesses. Plain and simple. People who found starts are NOT THE TOP 1%$
Rich people provide the capital (either directly or indirectly) for the entrepreneurs to convert their ideas into job-creating businesses. There are plenty of great ideas out there and plenty of passionate inventors ready to chase them. What's needed is wisely-deployed capital.
Hanaur got that part right. Rich people don't consume proportionally with their lower-income counterparts. So unless the rich guy sets his money on fire or stuffs a mattress with it, it's going to get invested.
gjohnson5
New member
How about the customers of those businesses.....? They are the one who are funding the startup's operations. We have already learned from the economic collapse around 2000 that venture capital cannot fund businesses....
mrplunkey
New member
Cutting jobs yet providing the same goods or services increases productivity. It lowers the unit cost of production which either makes consumers richer (via lower prices), investors richer (via higher returns) or other employees richer (via higher wages). Where else could the wealth go? And assuming the government isn't waging a war on jobs (like it is now), that employee can then go off and do something even more meaningful with a business that actually needs their efforts.
If a business could perform at the same level with fewer employees, why wouldn't it? Should McDonalds employ greeters at their doors just to create jobs? A business operating at less than peak productivity just makes everyone less rich.
mrplunkey
New member
Consumer's don't fund startups. Consumers buy stuff.
If I broke every window in my neighbors house tonight, I'll create jobs in glass manufacturing. But did I make anyone richer? You could create a computer manufacturing job by smashing the computer you're posting on right now. Does that mean you made someone richer?
Could we fix this economy by just breaking everything within reach?
gjohnson5
New member
Which is called profit :-(
No you wouldn't because those would end up as insurance claims. Some of those probably wouldn't pay for the total amount of damage done. Most likely it would end up as a net loss for the home owners
The insurance company is the only group who would win in that
Yes the 1% would win again
Unfortunately this makes no sense at all so no it wouldn't
mrplunkey
New member
Really? I thought when people bought stuff it was an expense to them and revenue to the business from which they purchased it.
mrplunkey
New member
So let's get this straight: If I break a window and create a glass manufacturing job, the economy didn't benefit because the homeowner would take an offsetting loss.
But somehow if I tax that same amount from a rich person and give it to a poor person to consume with, we've somehow grown the economy?
Makes no sense whatsoever.
Headholio
New member
So you think that rich people putting their money in the bank and into stocks is sufficient justification to reduce top tax rates?
For HIS benefit.
mrplunkey
New member
They buy bonds too.
But to answer your question, we should provide globally competitive tax rates to the upper brackets only if we want that capital available to job creators. Otherwise we can just stay in our steady downward spiral of the middle class as the wealthy continue to globalize.
The other thing I don't like is the false choice between lowering rates on either the rich or the poor. We're somehow led to believe that one much be high and the other low so we can fund our bloated, irresponsible government. Here's a big idea: The rates should be low on both and the government should learn to live with less. It's like asking if we should be lenient on murders or rapists. Why not put them both in jail instead?
Headholio
New member
Right. Breaking windows in the neighborhood benefits the few (the window repair business), at the expense of the many. A strong economy is built on a strong middle class. Business doesn't thrive without customers. Overall, if everyone has to buy new windows, it would be an overall drain on the economy, but some people would benefit.
Its easy to show that money used to fund public works projects, or provide loans for business or education, or even to buy food stamps, has a more positive stimulus effect on the economy than giving tax breaks to rich people. That's econ 101.
mrplunkey
New member
Well my goodness, we can't have that -- can we?
He might do something irresponsible, like:
1) Put it in a bank so some entrepreneur could borrow it.
2) Buy a bond, so some business could expand.
3) Buy factory equipment, so more goods or services could be produced.
4) Upgrade or retrain his workforce, leading to higher quality and better-paying jobs
5) Innovate a new technology and give us the next Internet or telephone
We couldn't have anything like that, because it would be for HIS benefit.
Name one legal thing that could be done with that money that's worse than it being sent to Washington so as to be metered back out to special interests all in the name of getting politicians re-elected.
mrplunkey
New member
Really? So if the US had nothing but middle class jobs and every business (large and small) were 100% foreign-owned with profits being funneled back to their home country, we'd be just fine?
A strong economy is built on a strong capital/investment/entrepreneurial class AND a strong middle class.
This notion that Joe lunchpail is going to buy enough iPhones and flat screen TVs to get us out of our current Obama mess is just nonsense.
mrplunkey
New member
Yeah, that education bubble we're building with cheap federal college money is going to work-out just great for us. There's nothing the global economy needs more than some sociology, political science and women's studies majors.
And our other investments are doing swimmingly well too. I recharge my Fisker car every night with genuine Solyndra solar panels.
And just the other night I was wondering how fast a shrimp could go on a scaled down treadmill and I'll be darned if the government didn't help me with that too!
I guess all that's left to do is raise our glasses and toast the US government. Well done guys. Well done!
Headholio
New member
Consider first that 400 people at the top have more wealth than 150 million people at the bottom.
I don't know how many flat screens and cell phones those 400 people need, but if I was selling cell phones or flat screen's, I'd bet my success on Joe lunchpail.
Obama mess?
mrplunkey
New member
Obama mess?
Oh, so the economy is doing well?
I'm happy with it. If you are as well, I guess we've found some common ground.
That's all I can think of, unless you're about to blame Obama's second-term failures on Bush again. Or does Barry still not own it, despite being on year five?
Yeah that's the damn truth. What is even worse that the 99% doesn't get is that the 1% hire the best accountants and attorneys so they don't pay the same % in taxes. Lol
The rich keep theirs because their rich.
Lets not be ignorant and not let that money return to the US so that it can be invested in businesses. The foreign countries are using our offshore tax haven dollars to kick our ass.
gjohnson5
New member
You're the one who makes no sense.
Those broken windows would not create enough demand for creating glass manufacturing jobs. The people who currently work would be asked to work longer and faster. No hiring would result
However the loss for the home owners would hurt their cash reserves. They would soon not be able to afford more windows
mrplunkey
New member
You're missing the entire concept.
Ponder this overnight, then rethink that post:
Is all consumption of equal value?
And here's a hint:
Person one gets $1M and buys a house and some bling.
Person two gets $1M and invents a machine that does the work of 20 people with a single person. The machine will last for 20+ years.
Both consumed things, but in which scenario was wealth created?
gjohnson5
New member
No , it makes the manufacturer richer because he IS NOT going to decrease his prices just because his business became more efficient. This will increase the manufacturer's bottom line
agreed.
Most Private sector salaries haven't increased appreciably in 30 years.... Infact in many cases they have declined
You might want to start by researching a little bit. 2 of the 3 options you used above were wrong
mrplunkey
New member
No , it makes the manufacturer richer because he IS NOT going to decrease his prices just because his business became more efficient. This will increase the manufacturer's bottom line
agreed.
Most Private sector salaries haven't increased appreciably in 30 years.... Infact in many cases they have declined
You might want to start by researching a little bit. 2 of the 3 options you used above were wrong
So is it your position that a manufacturer has never lowered their price as a result of achieving a lower unit cost of production?
PICK3
New member
want to know my position?
gjohnson5
New member
In some cases that may be true. IMHO more often then not the increased efficiency (especially a public ally traded company) would mean a higher bottom line and better investor returns ... just as you stated.
mrplunkey
New member
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