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George.
02-18-2010, 06:52 AM
Here is an interesting insight into the true power structures in America, and by extension, the world:


Feb. 18 (Bloomberg) -- The 400 highest-earning U.S. households reported an average of $345 million in income in 2007, up 31 percent from a year earlier, IRS statistics show.
...

The top 400 earners received a total $138 billion in 2007, up from $105.3 billion a year earlier.

Just to put it in context: 138 billion is more than the GDP of 140 of the world's 190 countries. Those 400 individuals make more money than the entire population (including the filthy rich) of countries like Peru, New Zealand, Vietnam, or Bulgaria.

Make no mistake: political power has a similar distribution.

George.
02-18-2010, 07:46 AM
Poor things! No capital gains since 2007! They must be starving...

In fact, Donn, the people who made money from capital gains in 2007 made out like bandits. If they had capital gains that year it's because they sold - with the Dow at its peak. And I assure you that a good bit of them bought back in around March of last year, and just made another killing.

Popeye
02-18-2010, 08:05 AM
what are you suggesting george , a fixed horse race , the old boys network , insider information ...

balderdash man

now cut it out

George.
02-18-2010, 08:06 AM
It's an expression, Donn.

TomF
02-18-2010, 10:16 AM
Remind me again how Marx was wrong in observing radically different interests between the classes, and an effect of capitalism being the ongoing accumulation of wealth and power at the top, with people formerly in the middle being slowly squeezed down to join the working class.

Marx's solutions were faulty, no doubt. Aspects of his analysis were pretty accurate.

George.
02-18-2010, 10:20 AM
Another way to consider the arithmetic: average per capita income in the US is about USD 46,000. That means each of those 400 is worth 75,000 ordinary citizens. Together, they outweigh 30 million average Americans. Their political power is probably even more disproportional.

oznabrag
02-18-2010, 10:22 AM
Another way to consider the arithmetic: average per capita income in the US is about USD 46,000. That means each of those 400 is worth 75,000 ordinary citizens. Together, they outweigh 30 million average Americans. Their political power is probably even more disproportional.

And they're unelected.

Kaa
02-18-2010, 10:43 AM
Remind me again how Marx was wrong in observing radically different interests between the classes, and an effect of capitalism being the ongoing accumulation of wealth and power at the top, with people formerly in the middle being slowly squeezed down to join the working class.

Since you've asked, I'm reminding you :-)

Marx wrote in the second half of the XIX century. How did the middle class in capitalist countries have fared since then?

Kaa

TomF
02-18-2010, 10:48 AM
Since you've asked, I'm reminding you :-)

Marx wrote in the second half of the XIX century. How did the middle class in capitalist countries have fared since then?

KaaDepends on how you choose a yardstick.

Done very well financially in absolute terms ... especially in comparison with historical antecedents. Done abysmally poorly, if the appropriate comparator is their wealth as a proportion of the wealth of the elites. Rarely if ever have we seen such a disparity between the rich, and the rest of us - whether "poor" or "middle class."

Kaa
02-18-2010, 10:57 AM
Depends on how you choose a yardstick.

No, it doesn't. The question is not how well the middle class did -- the question is whether it was "squeezed down" so that it became a part of working class. That clearly did not happen -- Marx was wrong. In fact, the opposite happened -- parts of working class became middle class.


Rarely if ever have we seen such a disparity between the rich, and the rest of us - whether "poor" or "middle class."

:eek: Really? If you look at the numbers, sure. But if you look at the power of the rich, by historical standards it's very very modest.

Kaa

hokiefan
02-18-2010, 11:07 AM
Depends on how you choose a yardstick.

Done very well financially in absolute terms ... especially in comparison with historical antecedents. Done abysmally poorly, if the appropriate comparator is their wealth as a proportion of the wealth of the elites. Rarely if ever have we seen such a disparity between the rich, and the rest of us - whether "poor" or "middle class."

But this is the wrong yardstick. If I have the things I need, and a few of the ones I want, I'm a lucky man. Does it really affect my situation if the guy down the road has a radically bigger pile? Only if I let it affect me. So if I get a few more of the things I want I'm better off. Doesn't matter if the rich bugger gets even more.

My $0.02 for what its worth.

Bobby

TomF
02-18-2010, 11:12 AM
Kaa, by any objective standard, the middle class is no longer "middle" in comparison with the wealthy. This stratification is increasing, not decreasing ... and arguably, will only increase further with the continued off-loading of manufacturing and service jobs to low-wage areas of the world.

That is, Marx was right. The stratification of wealth has continued to accelerate at an unprecedented pace. What is different is that while religion was used to keep the working class docile in the 19th Century, a proportionately very modest re-investment in working class incomes has done the same in the late 20th and early 21st Centuries.

As to the power of the rich, I think you might take that up with George.

TimH
02-18-2010, 11:14 AM
Anything that concentrates that much money and power into the hands of a select few needs to be re-evaluated.

pefjr
02-18-2010, 11:16 AM
That's how things work. Yes. And when it's not like that, things are not working. So get to work.

Kaa
02-18-2010, 11:19 AM
Kaa, by any objective standard, the middle class is no longer "middle" in comparison with the wealthy. This stratification is increasing, not decreasing ...

Since the late XIX century..?

Tom, you need a big reality check.


...and arguably, will only increase further with the continued off-loading of manufacturing and service jobs to low-wage areas of the world.

Sigh. Service jobs are not being offshored much. And manufacturing jobs are the jobs of the working class, not middle class.

In return, you get strong growth of middle class in these "low-wage areas of the world".


That is, Marx was right. The stratification of wealth has continued to accelerate at an unprecedented pace.


Looks like we live in different universes. And Marx was talking not about stratification (which always happens), but about polarization. He envisaged a small bunch of very very rich people and a large bunch of very very poor people -- with nothing in between. He was wrong.

Kaa

hokiefan
02-18-2010, 11:23 AM
Kaa, by any objective standard, the middle class is no longer "middle" in comparison with the wealthy. This stratification is increasing, not decreasing ... and arguably, will only increase further with the continued off-loading of manufacturing and service jobs to low-wage areas of the world.

That is, Marx was right. The stratification of wealth has continued to accelerate at an unprecedented pace. What is different is that while religion was used to keep the working class docile in the 19th Century, a proportionately very modest re-investment in working class incomes has done the same in the late 20th and early 21st Centuries.

As to the power of the rich, I think you might take that up with George.

But remember that the various classes, poor, working, middle, upper, are defined by percentiles not by their earnings on the scale. Upper class are the top 10% of the people (20% in some definitions I've seen). The average of the uppers will be way higher than the average of the upper middle or middle.

Bobby

TimH
02-18-2010, 11:24 AM
Since the late XIX century..?

Tom, you need a big reality check.



Sigh. Service jobs are not being offshored much. And manufacturing jobs are the jobs of the working class, not middle class.

In return, you get strong growth of middle class in these "low-wage areas of the world".



Looks like we live in different universes. And Marx was talking not about stratification (which always happens), but about polarization. He envisaged a small bunch of very very rich people and a large bunch of very very poor people -- with nothing in between. He was wrong.

Kaa

The stratification IS increasing. YOU need a reality check Kaa.
You are the one living in a different universe.

Ans manufacturing is what made this country strong. Not service jobs. You are soo out of it. :rolleyes:

TimH
02-18-2010, 11:25 AM
The people that defend this are the people that are dilusional enough to see themselves as one of the elite one day.

Keep on dreaming.

pefjr
02-18-2010, 11:26 AM
You probably have a average 1/3 of your assets in property. When Real Estate values turned over and fell you probably lost about $200,000. Some of you walked away from your Real Estate, defaulted on your loan and lost nothing. But these unlucky 400 lost on average about 120,000,000. Some of them had heart attacks over losing that much paper.

TomF
02-18-2010, 11:28 AM
We do live in different universes, Kaa. In mine,
Feb. 18 (Bloomberg) -- The 400 highest-earning U.S. households reported an average of $345 million in income in 2007, up 31 percent from a year earlier, IRS statistics show.
...

The top 400 earners received a total $138 billion in 2007, up from $105.3 billion a year earlier. This is indeed unprecedented stratification, which has grown extraordinarily since the end of the 19th Century. Why, even fact-checking organizations like PolitiFact, when dared to verify Joe Biden's claims (http://www.politifact.com/truth-o-meter/statements/2009/mar/06/joe-biden/biden-points-out-disparities-between-ceo-and-avera/), agree that the stratification is astonishing, and growing at a surrealistic pace. For instance, they report
The gap between CEO compensation and a typical worker's pay has widened exponentially over the last few decades.

According to the Economic Policy Institute report, in 1965, U.S. CEOs in major companies earned 24 times more than a typical worker; by 2007, they made 275 times more. U.S. CEOs also make far more than CEOs in other advanced countries, the report said.
"The major CEOs pay is otherworldly," said Larry Mishel, one of the authors of the Economic Policy Institute report. If someone earns 275 times more than one of their "average" employees, is there any meaningful way to describe that employee as being in the "middle class"?

George.
02-18-2010, 11:29 AM
... Marx was talking not about stratification (which always happens), but about polarization. He envisaged a small bunch of very very rich people and a large bunch of very very poor people -- with nothing in between. He was wrong.


He was wrong about the "nothing in between" - you can't ever cut out the middlemen. He got the rest pretty much spot on so far.

pefjr
02-18-2010, 11:33 AM
The people that defend this are the people that are dilusional enough to see themselves as one of the elite one day.

Keep on dreaming.Do you want to pass some laws to make it a crime to make money?

TomF
02-18-2010, 11:35 AM
Do you want to pass some laws to make it a crime to make money?Personally, I'd suggest the guy earning 275 times more than his average employee could probably afford to forego a tax break.

Kaa
02-18-2010, 11:35 AM
If someone earns 275 times more than one of their "average" employees, is there any meaningful way to describe that employee as being in the "middle class"?

Of course. Why not?

As an aside, what do you think the income distribution looked like in, say, XVIII-century France or England?

Kaa

George.
02-18-2010, 11:40 AM
You know, the reason they have the money is that the rest of the people gave it to them. Most of them probably got rich legally. It's a democracy of sorts.

seanz
02-18-2010, 11:40 AM
Since

Sigh. Service jobs are not being offshored much. And manufacturing jobs are the jobs of the working class, not middle class.

In return, you get strong growth of middle class in these "low-wage areas of the world".



And.....a poor outlook for the middle class in countries that outsource their manufacturing? That's not what you meant?
It's not just worker drones that go through those wrought iron gates, you know.
;)

Kaa
02-18-2010, 11:42 AM
And.....a poor outlook for the middle class in countries that outsource their manufacturing?

Don't see one. Hear a lot of screaming by Nervous Nellies and Chicken Littles, though... :D

Kaa

TomF
02-18-2010, 11:46 AM
Of course. Why not?Because "middle" typically means, er, "middle." It's a relative descriptor, not an absolute one. The meaning derives from context ... for instance, a black dot in the middle of a piece of paper is defined by its relative position between the paper's edges. It cannot be "in the middle" if it's way over at the edge of the sheet ... no matter how black the dot is.

Perhaps you might share how you define "middle" in the context of the term "middle class"?
As an aside, what do you think the income distribution looked like in, say, XVIII-century France or England?

KaaPerhaps skewed enough to provoke a Revolution or two, no?

pefjr
02-18-2010, 11:47 AM
Personally, I'd suggest the guy earning 275 times more than his average employee could probably afford to forego a tax break.Then you are fining him for making too much money. Most of the money he made was based on the profit of the Corp. During the time that the CEO pay was increased so much the PE ratio doubled(some tripled) for the stock holder. Fine the stock holder too. You soon will destroy free enterprise.

TomF
02-18-2010, 11:48 AM
Then you are fining him for making too much money. Most of the money he made was based on the profit of the Corp. During the time that the CEO pay was increased so much the PE ratio doubled(some tripled) for the stock holder. Fine the stock holder too. You soon will destroy free enterprise.Define "free."

hokiefan
02-18-2010, 11:51 AM
Don't forget, these 400 people are not CEO's. These are the people who own CEO's. They think of the CEO as the hired help.

And they only constitute 0.00013% of the US population. They are not the norm, even for the upper, upper class.

Bobby

pefjr
02-18-2010, 11:54 AM
Define "free.":confused: com on now Tom

Kaa
02-18-2010, 11:54 AM
Because "middle" typically means, er, "middle." It's a relative descriptor, not an absolute one. The meaning derives from context ... for instance, a black dot in the middle of a piece of paper is defined by its relative position between the paper's edges. It cannot be "in the middle" if it's way over at the edge of the sheet ... no matter how black the dot is.

I think you're successfully undermining your own position :-) Keep going...


Perhaps you might share how you define "middle" in the context of the term "middle class"?

Sure. Hold on, lemme get my extra-wide brush :-)

In the socioeconomic framework (Marx, etc.) the lower classes are those who own little to no property and must rely on selling their labor to survive. The middle classes are those who own some property but still must work or limit themselves to modest means. The upper classes are those who own a lot of property and do not need to either work or limit themselves to modest means.

How would you define yourself, Tom? Do you belong to the working class or the rich? What about your neighbours? What about most people on this board? Are we all proles with a few exceptions of rich bastards?

Kaa

seanz
02-18-2010, 11:56 AM
Don't see one. Hear a lot of screaming by Nervous Nellies and Chicken Littles, though... :D

Kaa

The same sort of people that repeatedly get taught the difference between investment and speculation but fail to learn the lesson?

cookie
02-18-2010, 11:58 AM
Don't forget, these 400 people are not CEO's. These are the people who own CEO's. They think of the CEO as the hired help.

And they only constitute 0.00013% of the US population. They are not the norm, even for the upper, upper class.

Bobby

If you earn more then more than the GDP of 140 of the world's 190 countries, you are THE norm, if you ask me :)

Even Warren Buffet thinks it is weird that his secretary and most other employees pay a much higher % income tax than him....


Quote:
Originally Posted by pefjr http://www.woodenboat.com/forum/images/buttons/viewpost.gif (http://www.woodenboat.com/forum/showthread.php?p=2495501#post2495501)
Do you want to pass some laws to make it a crime to make money?


Personally, I'd suggest the guy earning 275 times more than his average employee could probably afford to forego a tax break.

oznabrag
02-18-2010, 12:00 PM
Then you are fining him for making too much money. Most of the money he made was based on the profit of the Corp. During the time that the CEO pay was increased so much the PE ratio doubled(some tripled) for the stock holder. Fine the stock holder too. You soon will destroy free enterprise.

Well lah-ti-dah Mr. ^#@(*&!

Maybe you can explain why you think it's OK to 'fine' everybody else for making too little?

In the '50s, the top, marginal tax rate was in the 90% range, and free enterprise thrived. Thrived, I'm tellin' you!

What you are is greedy, Pefster.

TomF
02-18-2010, 12:00 PM
Don't forget, these 400 people are not CEO's. These are the people who own CEO's. They think of the CEO as the hired help.

And they only constitute 0.00013% of the US population. They are not the norm, even for the upper, upper class.

BobbySure. But to be more democratic about it, let's look at another study (http://www.eurekalert.org/pub_releases/2006-12/unu-pss120106.php) that takes away a few of those zeros behind the decimal point.
The most comprehensive study of personal wealth ever undertaken also reports that the richest 1% of adults alone owned 40% of global assets in the year 2000, and that the richest 10% of adults accounted for 85% of the world total. In contrast, the bottom half of the world adult population owned barely 1% of global wealth.So again, where's the "middle" in arguments about the existence of the "middle class"? How has this degree of stratification not made normal usage of the term meaningless, however much "middle class incomes" have risen in absolute (though not relative) terms?

TomF
02-18-2010, 12:06 PM
In the socioeconomic framework (Marx, etc.) the lower classes are those who own little to no property and must rely on selling their labor to survive. The middle classes are those who own some property but still must work or limit themselves to modest means. The upper classes are those who own a lot of property and do not need to either work or limit themselves to modest means.

How would you define yourself, Tom? Do you belong to the working class or the rich? What about your neighbours? What about most people on this board? Are we all proles with a few exceptions of rich bastards?

KaaMe? It all depends on what context I situate myself in. Compared with the folks in Belize that my daughter will be meeting in a couple of weeks, I'm a very rich bastard. Compared with my neighbours, I'm lower middle - we're the only folks on the street with only one full-time professional income.

But Marx is correct - compared with those who actually own the means of production, I'm a prole. I have far more in common with the destitute than with the people in that top 10%, let alone the top 1%.

Kaa
02-18-2010, 12:06 PM
The same sort of people that repeatedly get taught the difference between investment and speculation but fail to learn the lesson?

LOL. Do tell. I'm one of those who can't see the difference. Explain it to me, please..?

Kaa

seanz
02-18-2010, 12:15 PM
Investment is where if the SHTF you don't lose all your money.

Or you put it another way......if you invest in property the worst you should do is end up with a roof over your head. Speculate on property and you might end up without even a roof.

Hope his has helped.
:D

pefjr
02-18-2010, 12:30 PM
If my grandparents were alive to read this thread. I can hear them talking. "Would you listen to these young'uns a whining and a moanin about not having enough. Why, we don't have an inside bathroom, flowing water, phone, what's a computer ?, remote control TV, toaster, microwave, vcr, king size bed, 3 car garage with an automatic opener, Air Conditioning, and Heat, etc, etc, well bless their selfish little hearts. They are living like Kings but want more. Even want to take their neighbors money. What's this world coming to".

Kaa
02-18-2010, 12:30 PM
But Marx is correct - compared with those who actually own the means of production, I'm a prole.

Heh. Do you think if we were to show you to Marx, Marx would agree? :D


I have far more in common with the destitute than with the people in that top 10%, let alone the top 1%.

Data for Canada (http://www.oecd.org/document/42/0,3343,en_2649_37419_43692394_1_1_1_1,00.html)

Median income for the bottom 10% -- $8,000
Median overall income -- $25,300
Median income for the top 10% -- $70,700

Oh these horrible, horrible richest 10% :D Barely human, I tell you...

Kaa

Kaa
02-18-2010, 12:32 PM
Investment is where if the SHTF you don't lose all your money.

Hope his has helped.
:D

Um, no it didn't, at all.

Can you give me some examples?

Kaa

TimH
02-18-2010, 12:35 PM
Do you want to pass some laws to make it a crime to make money?

There needs to be a limit.

The psychology that drives these people to strive for money and power at the expense of all else applies whether they can potentially become very rich or disgustingly rich. The aberration is still there.

TimH
02-18-2010, 12:40 PM
Don't see one. Hear a lot of screaming by Nervous Nellies and Chicken Littles, though... :D

Kaa

So trading in manufacturing jobs where one can earn a livable wage for Walmart type service jobs making $7hr with no health insurance is a sustainable path for the future?

hokiefan
02-18-2010, 12:40 PM
There needs to be a limit.

The psychology that drives these people to strive for money and power at the expense of all else applies whether they can potentially become very rich or disgustingly rich. The aberration is still there.

See, it doesn't really affect me if someone else has a lot more. It just really doesn't. I want them to pay their fair share of the taxes and I don't believe thats happening now, but thats a completely different conversation. If the tax laws were changed to what I would like, they would still have a big huge pile. And you know what, it still doesn't affect how I view my situation. I have the things I need and some of what I want. Therefore I'm a lucky man. Doesn't bother me in the least that some of them have more.

Cheers,

Bobby

Popeye
02-18-2010, 12:41 PM
did you know ,wealthy people , when they pass away, are typically laid to rest face down

there are two reasons for this unusual practice , here's why :

1 . so the rest of the world can kiss their arse

and

2. so they can see where they're going

TimH
02-18-2010, 12:41 PM
Kaa,

How much time have you spent exposed to service jobs and how much time have you spent exposed to manufacturing jobs?

I have worked at both. There is no comparison.

TimH
02-18-2010, 12:45 PM
See, it doesn't really affect me if someone else has a lot more.

Thats the whole problem. Most people see themsleves as somehow removed from the trends of society. Until it smacks them in the face one day and they find themselves losing their house and on the street because Someone high up made a decision that they can profit-take much better in the short term by sending your job offshore.

Money = power and power corrupts.

Contrary to the Gordon Ghecko mentality, Greed is not good. Not good for the population as a whole.

pefjr
02-18-2010, 12:52 PM
There needs to be a limit.

The psychology that drives these people to strive for money and power at the expense of all else applies whether they can potentially become very rich or disgustingly rich. The aberration is still there.What's the limit?

I know it's hard to get rich, but I'm guessing it's not so hard to go from rich to what you call disgustingly rich. I think it's a lot easier to make money from money. I also don't believe the very rich get it at the "expense of all else". In Fact, their are others making money in the process of the very rich making more. Limiting this will effect the whole economy. And why do you and some others call it"disgustingly rich". Is that jealousy? I have never had the time to sit and worry about how much money someone else has. I spent all my time trying to make enough for myself and family. Now, if I was starving, maybe I'd look over and see how much you have and take some of it, but that's a different story.

I always thought it boils down to "How much is enough for me?" When I reached that amount I was happy. So, how much is enough for you? and what does it have to do with Joe the disgusting rich guy?

seanz
02-18-2010, 12:53 PM
Um, no it didn't, at all.

Can you give me some examples?

Kaa

Bit pressed for time this morning.......I'm sure there are examples out there somewhere, some are probably quite recent......can you tell me which part is causing the confusion? That might help me better illustrate the difference.

Often it's a volume thing......a property investor might say quietly "Portfolio didn't do that well this year, could only afford 2 weeks in the islands"
While a speculator might scream "I've got ***grand in that dump, if it doesn't sell next week I'll lose my house!"

You haven't heard this sort of thing before?

You must have, you breath the same air as the rest of us, I've seen pictures (allegedly) of your boat.
;):D

Popeye
02-18-2010, 12:55 PM
Bit pressed for time this morning......

fear not , readers digest now has a financial section

seanz
02-18-2010, 12:58 PM
fear not , readers digest now has a financial section


I thought there was something familiar about your style.....

pefjr
02-18-2010, 01:00 PM
Bit pressed for time this morning.......I'm sure there are examples out there somewhere, some are probably quite recent......can you tell me which part is causing the confusion? That might help me better illustrate the difference.

Often it's a volume thing......a property investor might say quietly "Portfolio didn't do that well this year, could only afford 2 weeks in the islands"
While a speculator might scream "I've got ***grand in that dump, if it doesn't sell next week I'll lose my house!"

You haven't heard this sort of thing before?

You must have, you breath the same air as the rest of us, I've seen pictures (allegedly) of your boat.
;):Dit's just the degree of risk involved in the investment, that makes it speculative.

TimH
02-18-2010, 01:05 PM
I have never had the time to sit and worry about how much money someone else has. I spent all my time trying to make enough for myself and family. Now, if I was starving, maybe I'd look over and see how much you have and take some of it, but that's a different story.



Worry about yourself then. But dont argue with people that look at the big picture.

As millions of American have learned in the last couple of years, it can become YOUR problem real fast.

Popeye
02-18-2010, 01:05 PM
I thought there was something familiar about your style.....

.. and who would make a finer judge ?... :rolleyes::D

TimH
02-18-2010, 01:07 PM
What kind of boat does Kaa have? I have never seen it - or even seen him talk about a boat.

Popeye
02-18-2010, 01:09 PM
i got kaa placed neatly inside a thong bikini actually

pefjr
02-18-2010, 01:17 PM
Worry about yourself then. But dont argue with people that look at the big picture.

As millions of American have learned in the last couple of years, it can become YOUR problem real fast.If people that think like you have any influence in f%^$@(g up the big picture it effects me. So, you are right, I don't worry. :D

Kaa
02-18-2010, 01:17 PM
Bit pressed for time this morning.......I'm sure there are examples out there somewhere, some are probably quite recent......can you tell me which part is causing the confusion? That might help me better illustrate the difference.

A guy, $100m net worth, buys $100K of short-term out-of-the-money options on oil price. Speculation or investment?

A guy, pretty much zero net worth, buys a house. Speculation or investment?

A guy, $500K net worth, puts half of his retirement money into GM stock in 2007. Speculation or investment?

A guy buys some gold coins because he thinks gold price is going to go up in the near future. Speculation or investment?

The twin brother of the previous guy also buys exactly the same amount of gold coins, but the reason is he distrusts paper currencies and thinks gold is more solid. Speculation or investment?

A guy buys some stock of company X because he likes the long-term prospects of the company. Speculation or investment? Next day he changes his mind and sells his position. Now, was it speculation or investment?


You haven't heard this sort of thing before?

Oh, I have, it's just that this sort of thing has been profoundly unsatisfying... :-)

Kaa

Kaa
02-18-2010, 01:18 PM
i got kaa placed neatly inside a thong bikini actually

/me helpfully offers Popeye a rusty spork :D

Kaa

Popeye
02-18-2010, 01:23 PM
a guy who just got out of jail likes to collect handguns and grow his own marijuana in his clothes closet

republican or democrat ?

TomF
02-18-2010, 01:29 PM
/me helpfully offers Popeye a rusty spork :D

KaaI'm with Kaa on this one, Pops. The percentage of the population that could be "placed neatly inside a thong bikini" is rather like the percentage of the global population that owns 40% of the world's wealth.:D

hokiefan
02-18-2010, 01:33 PM
I'm with Kaa on this one, Pops. The percentage of the population that could be "placed neatly inside a thong bikini" is rather like the percentage of the global population that owns 40% of the world's wealth.:D

But a much more enjoyable fraction of the population to watch.:)

Popeye
02-18-2010, 01:33 PM
we only got a few scant hours in this wilderness

i'm going after whats good

TomF
02-18-2010, 01:38 PM
But a much more enjoyable fraction of the population to watch.:)There's a disproprotionate number of the one sort hanging about with the other. :D

TimH
02-18-2010, 01:41 PM
So correct me if I am wrong, but there appear to be two types of people that see no problem with the majority of the wealth rapidly condensing in one tiny segment of the population:

1) Those that fancy themselves as one or soon to be one of the uber-wealthy.
2) Those that have the attitude that "My plan is going fine. I dont care if everyone else is living in the streets, dont upset the boat".

oznabrag
02-18-2010, 01:41 PM
...

A guy, pretty much zero net worth, buys a house. Speculation or investment?

...
Kaa

Neither.

Housing is a necessity.

Popeye
02-18-2010, 01:43 PM
cash in your wallet is speculation on the money market kaa

get over yourself

Kaa
02-18-2010, 01:53 PM
Neither.

Housing is a necessity.

Even if he buys it at the top of the bubble in order to flip it..? :D

Besides, housing is a necessity, but owning a house is not. Lots of people rent.

Kaa

oznabrag
02-18-2010, 01:56 PM
There needs to be a limit.

The psychology that drives these people to strive for money and power at the expense of all else applies whether they can potentially become very rich or disgustingly rich. The aberration is still there.

I don't know about a numerical 'cap' or such, but I do see this behavior as some flavor of psychosis. Definitely sociopathic behavior, at any rate, and it smells an awful lot like addictive behavior, as well. Some of us will drink until there's no more alcohol, and there are laws to limit the behavior that results.

The 1% of people who own half the wealth also control the next 9% who own the other half. The rest of us are profoundly powerless in the face of that much money.

hokiefan
02-18-2010, 01:57 PM
There's a disproprotionate number of the one sort hanging about with the other. :D

Yeah, funny how that happens. Guess $$$ can make any man sexy. Go figure.

Cheers,

Bobby

oznabrag
02-18-2010, 02:02 PM
Even if he buys it at the top of the bubble in order to flip it..? :D

Doesn't fit with your original assertion. You specced zero net worth, if I recall.


Besides, housing is a necessity, but owning a house is not. Lots of people rent.

Kaa

Yes. Lots of people rent, and for that equation to work out for the landlord, they are, by definition, paying more per month than they would if they had a mortgage on the place.

Kaa
02-18-2010, 02:06 PM
Doesn't fit with your original assertion. You specced zero net worth, if I recall.

Why doesn't it fit? You don't need any net worth to buy a house with a zero-down ridiculous-ARM mortgage and flip it the next week.


Yes. Lots of people rent, and for that equation to work out for the landlord, they are, by definition, paying more per month than they would if they had a mortgage on the place.

Not necessarily, there are LOTS of complicating factors. But this is irrelevant to my original point that *owning* a house is not a necessity.

Kaa

Kaa
02-18-2010, 02:07 PM
Yeah, funny how that happens. Guess $$$ can make any man sexy. Go figure.

Women like alpha males.

I rather doubt you can change that :-)

Kaa

Popeye
02-18-2010, 02:08 PM
still trying to be the smartest gal in the room

*sigh*

TimH
02-18-2010, 02:09 PM
I do see this behavior as some flavor of psychosis. Definitely sociopathic behavior, at any rate, and it smells an awful lot like addictive behavior, as well. Some of us will drink until there's no more alcohol, and there are laws to limit the behavior that results.



Interesting how there is little debate that drug and alcohol addictions needs to be dealt with by society, but unbridled greed is acceptable. Somehow there is a disconnect in that people seem to think it has no effect on them even AFTER this housing meltdown.

pefjr
02-18-2010, 02:29 PM
A person that works hard and smart (workaholic) now needs to be dealt with by society? yep, there is a disconnect there. Wonder if these worryoholics can find it.

TimH
02-18-2010, 02:32 PM
Working for the sake of working is one thing. But greed is another. The housing bubble affected everyone. This was the direct result of a bunch of greedy bastages attempting a slight of hand to line their pockets at everyone elses expense. Whether or not they are workaholics is beside the point.

pefjr
02-18-2010, 02:59 PM
Working for the sake of working is one thing. But greed is another. The housing bubble affected everyone. This was the direct result of a bunch of greedy bastages attempting a slight of hand to line their pockets at everyone elses expense. Whether or not they are workaholics is beside the point.Do you think responsible buyers turning and walking away from mortgages helped any. Lot of guilty people that should be held accountable. As far as I know, no person has been held responsible for walking away from the responsibility of a mortgage. Do you know any? The Gov't bailed all out and set a precedent for the future buyers. I know teachers and professionals that walked away free and clear. The ones that made money were the smart sellers. Should they be penalized?

TimH
02-18-2010, 03:21 PM
I know nobody that walked away from their mortgage. And any who did will face the consequences on their credit report. Same as anyone that files chapter 11 or 13.

B_B
02-18-2010, 03:23 PM
Another way to consider the arithmetic: average per capita income in the US is about USD 46,000. That means each of those 400 is worth 75,000 ordinary citizens. Together, they outweigh 30 million average Americans. Their political power is probably even more disproportional.
yet another way to look at the issue of income disparity would be to remove the 400 folks, and $345million income, from the 'average' list - that way you'll get a better idea of what the average earner earned - it isn't anywhere near the $46,000 average income.

Keith Wilson
02-18-2010, 03:35 PM
Most "average" income stats are actually medians, precisely to reduce the effect of a few people with very high incomes.

George.
02-19-2010, 07:28 AM
So correct me if I am wrong, but there appear to be two types of people that see no problem with the majority of the wealth rapidly condensing in one tiny segment of the population:

1) Those that fancy themselves as one or soon to be one of the uber-wealthy.
2) Those that have the attitude that "My plan is going fine. I dont care if everyone else is living in the streets, dont upset the boat".

There is also: 3) Those who understand that that is just the way things work, and is no more amenable to change than the fact that 10% of the women get 90% of male attention.

Humans are naturally acquisitive, and have a strong hoarding instinct. They naturally admire and envy those who have the most. Most people will do just about anything for money, or for the stuff that money buys. That is why the rich are powerful - because deep down, most people agree that what they have is the most important thing there is.

John Smith
02-19-2010, 07:43 AM
But this is the wrong yardstick. If I have the things I need, and a few of the ones I want, I'm a lucky man. Does it really affect my situation if the guy down the road has a radically bigger pile? Only if I let it affect me. So if I get a few more of the things I want I'm better off. Doesn't matter if the rich bugger gets even more.

My $0.02 for what its worth.

Bobby
Speaking just for myself, I begrudge no one making lots of money, as long as he doesn't make it by polluting the water, the air, or the ground, if you get my drift.

I don't mind a successfull CEO making large bonuses. I do have a problem with the CEO making large bonuses when he has failed at his job and cost many people their jobs and their retirement packages.

The "average Joe", I think, is satisfied just to get an even break. From his standpoint, he's not getting that fair shot. He loses his job, he loses his health insurance. Even with his job and health insurance, if he's got a serious illness in his family, he's got a major problem.

He sees huge bonuses to failed CEO's and he can't even get a cost of living increase.

He's got credit cards and paid them on time for years. One statement doesn't come or he loses it, and misses that payment. Suddenly his interest rate jumps retroactively on his cards.

He's the sucker who never gets that even break.

John Smith
02-19-2010, 07:48 AM
You probably have a average 1/3 of your assets in property. When Real Estate values turned over and fell you probably lost about $200,000. Some of you walked away from your Real Estate, defaulted on your loan and lost nothing. But these unlucky 400 lost on average about 120,000,000. Some of them had heart attacks over losing that much paper.

What did they have left?

You probably argued that Bill Gates couldn't have made any money under Clinton's tax rates.

These are the people who made the decisions that led to the collapse. It cause many of the lower classes to lose their jobs, their homes, their helath insurance. And you think we should feel sorry for those who had to give up one of several homes? They kept their jobs, or left with huge retirement packages.

Kind of hard to feel all that sorry for them.

John Smith
02-19-2010, 08:23 AM
Kaa,

How much time have you spent exposed to service jobs and how much time have you spent exposed to manufacturing jobs?

I have worked at both. There is no comparison.

It's just my gut speaking, but money ends up in the country of manufacture. Much has been made in recent years that we export $700 billion a year for oil. Little has been made of exporting a similar amount for manufactured goods, but I'd submit this is as much of a problem.

I don't know how much money is enough money, but I do believe most of the wealthy people get wealthy because the "middle" class consumes their goods or services, and the money spent by the middle class trickles up to those at the top.

The people at the top would have, I'd think, a vested interest in the ability of the people down the ladder to consume goods and services.

People need not only be employeed, but they need to be GAINFULLY employed. When a factory leaves this country and people lose $20 an hour jobs with health insurance, and manage to get a $12 an hour job without health insurance, their consumption goes down. Less trickles up.

I'd like to see top compensation connected in some way to the number of Americans employed and how those employees are compensated. Perhaps some multiple. Perhaps something else.

Generous compensation should be tied to success.

TimH
02-19-2010, 11:21 AM
Once again John Smith is the only voice of reason.
Oh well. Nothing we can do about it as you say. My goal is to enjoy my life and do the things I have long wanted to do.
I know people whos only interest and goal is to amass a pile of cash at all costs. May they die rich, but you cant take it with you.

How many people on their death bed say their regret was that they didnt make more money?

oznabrag
02-19-2010, 11:32 AM
It's just my gut speaking, but money ends up in the country of manufacture. Much has been made in recent years that we export $700 billion a year for oil. Little has been made of exporting a similar amount for manufactured goods, but I'd submit this is as much of a problem.

I don't know how much money is enough money, but I do believe most of the wealthy people get wealthy because the "middle" class consumes their goods or services, and the money spent by the middle class trickles up to those at the top.

The people at the top would have, I'd think, a vested interest in the ability of the people down the ladder to consume goods and services.

People need not only be employeed, but they need to be GAINFULLY employed. When a factory leaves this country and people lose $20 an hour jobs with health insurance, and manage to get a $12 an hour job without health insurance, their consumption goes down. Less trickles up.

I'd like to see top compensation connected in some way to the number of Americans employed and how those employees are compensated. Perhaps some multiple. Perhaps something else.

Generous compensation should be tied to success.

The quote in bold, above, is where you argument falls apart.

The don't need any more money.

As noted in this thread, the top 10% ALREADY CONTROL about 95% of the wealth on the planet. Any further contributions we peons can make to their pile is essentially trivial. Further, they really have no need for any of the niceties of civilization like 'health-care reform', or 'police' or 'fire protection'. Screw the other 90%, the 10% have got theirs.

The trouble is they've got ours too!

oznabrag
02-19-2010, 11:40 AM
Here's a scary little essay:http://www.echeat.com/essay.php?t=30676

It contains this little gem: "Calonne, French Financial Minister, was faced with a deficit of nearly a quarter of the nations incomes, declared the state bankrupt and called for drastic measures to overcome it. He believed it wasn’t extravagance that was the problem and he believed the debts could be paid quite quickly if the privileged class paid their share in tax. His theory was that people should pay tax according to how much land they owned. Obviously, this didn’t go down well with people in the first and second estates. They were not used to paying taxes and were not about to start."

John Smith
02-19-2010, 02:15 PM
The quote in bold, above, is where you argument falls apart.

The don't need any more money.

As noted in this thread, the top 10% ALREADY CONTROL about 95% of the wealth on the planet. Any further contributions we peons can make to their pile is essentially trivial. Further, they really have no need for any of the niceties of civilization like 'health-care reform', or 'police' or 'fire protection'. Screw the other 90%, the 10% have got theirs.

The trouble is they've got ours too!
I think everything is like a link in a chain. Let's suppose you own a small eatery. Most of your lunch business is employees of local places of business. The economy dips and they lay off or close, and your business suffers, and maybe closes.

If we can keep your business and those other local businesses open, everyone is better off, including those at the upper end. Maybe you cafe makes a special sandwich that the rich guy loved. You close up, he can't get one.

To this end, money must circulate up, and then come back down via the top folks investing, banking it, or tax code.

Otherwise, it eventually all ends up with one guy.

Keith Wilson
02-19-2010, 04:10 PM
As noted in this thread, the top 10% ALREADY CONTROL about 95% of the wealth on the planet.Actually, just because you live in the US, you're probably part of the top 10%; certainly the top 20%.

John Smith's quite right. Those who consider things beyond the immediate decision to be made, or beyond the next quarter, realize this, but all too often, short-term greed trumps long-term self-interest.

George.
02-20-2010, 08:39 AM
We are not programmed to act in our long-term self-interest. We are programmed to seek power, status, and resources in order to reproduce successfully.

Look at lions. 80% die young without ever establishing a pride. The other 20% make out like kings, get all the hunting grounds and all the girls.

Humans have the same ecology. Genghis Khan and the Germanic nobles left thousands of times more descendants than the average person. The only difference between now and the Neolithic is that the majority who lose out are worth keeping alive as labor. In the days of the Tupinambá they simply bashed their heads in and ate them.

John Smith
02-20-2010, 09:45 AM
Actually, just because you live in the US, you're probably part of the top 10%; certainly the top 20%.

John Smith's quite right. Those who consider things beyond the immediate decision to be made, or beyond the next quarter, realize this, but all too often, short-term greed trumps long-term self-interest.
I don't think people, in general, connect all the dots. We have a new governor. Made lots of promises he won't be able to keep.

There needs to be a structure and a working plan of some kind for a society to work properly. When there is massive unemployment like we've been experiencing, the governore, who is legally bount to balance the books, faces revenue short falls. How does he balance his budget without cutting spending and/or raising revenue? How does he do either without pissing someone off?

If the wealthy many wishes to build himself a new home, it is to his advantage that there are lower class people working in all those areas that go into building a home. Not just the construction crew on the job, but the people who make ligh fixtures, furniture, building materials of all sorts, etc.

There's not enough wealthy customers to keep these industries working, so it's necessary that those who are not so wealthy can consume these materials to keep the market, to keep the suppliers.

It is, IMO, essential that the "middle class" be able to consume products. It's also essential, I believe, in order to keep the middle class in such a position, to make those products here.

Most seem to look directly at the banking industry as the culprit for our current problems. No doubt they were a major factor. I'd suggest the $4 a gallon gas squeezed the hell out of the middle class and contributed. How many were using credit cards to buy gas to get to work? How many missed a payment and had their interest rates retroactively jacked up to 30%. What impact did this have on their ability to pay their mortgage?

How many jobs have been lost over the last 3 decades by the factory moving offshore?

We've been in this downward spiral for some time. It's going to take some time to first stop the downward direction, and then start an upward trend.

I don't begrdge the wealthy making money, as long as they make it honestly, and aren't ripping the rest of us off. That said, this country has been very good to the very wealthy, and, as a society, we need them to, one way or another, send some of that money back to the lower rungs of the ladder so it can climb back up.

Keith Wilson
02-20-2010, 09:50 AM
We are not programmed to act in our long-term self-interest. We are programmed to seek power, status, and resources in order to reproduce successfully.Oh I dunno - some people (men, actually) try that route, particularly in very disordered times. Most fail miserably; some end up like Genghis Khan. Most human beings (and almost all women) generally favor the K-strategy as long as the environment is reasonably stable.

George.
02-20-2010, 10:16 AM
K-strategy involves hoarding... survival of the fattest. :D

Nicholas Carey
02-20-2010, 02:56 PM
Sure. But to be more democratic about it, let's look at another study (http://www.eurekalert.org/pub_releases/2006-12/unu-pss120106.php) that takes away a few of those zeros behind the decimal point. So again, where's the "middle" in arguments about the existence of the "middle class"? How has this degree of stratification not made normal usage of the term meaningless, however much "middle class incomes" have risen in absolute (though not relative) terms?

See this video: http://www.youtube.com/watch?v=woIkIph5xcU

The underlying web site site -- http://www.lcurve.org/ -- does a decent job of showing the stratification -- or as the stats propellor-heads would say, "the income distribution curve has a high positive skewness". The image below shows household income distributed among the population, along the length of a football field. The height of the red line at any point is the income, represented as the height of a stack of $100 dollar bills totalling up to that amount. The 50 yard line, natch, is the median (where exactly 50 percent of the population is below it and 50 percent is above it). With a distribution this skewed, the average (mean) is fairly...uh...meaningless :p since it is majorly affected by outliers (in Washington state, for instance, average (mean) pay for software developers is reported as being something like $300,000. That's because Bill Gates and a few Microsoft guys are included and their salaries jack up the average (discounting the anomolies by excluding those data points lying more than 3 standard deviations from the mean, and recomputing, you'll wind up with a far more accurate average of something like $90,000 for software developers in Washington State).

Anyway, here's our footbal field, with Mr. and Mrs. Median Household standing at the 50 yard line.

http://www.lcurve.org/ZoomShots/Zoom5.gif

If you zoom in at the median (by 2 orders of magnitude), meet Mr. and Mrs. Median Household. Their income is ~ $40k (that underlying data is a bit old, but serves to illustrate the point). Their stack of $100 bills is 4cm tall.

http://www.lcurve.org/ZoomShots/Zoom1.gif

If you zoom out from our original view, by a factor of 10, the frame is now 1km square. You can still see our metric footbal field. The tree is a giant sequoia, for scale. This country has about 400 billionaires. Their stack of $100 bills extends to the top of the frame.

http://www.lcurve.org/ZoomShots/Zoom7.gif

If we zoom out another two orders of magnitude, the frame is now 100km (62miles). The red line here represents Bill Gates' largest one-year increase in net worth ($50 billion, a stack of $100 bills 50km/30 miles high). The mountain? That's Mount Everest.

http://www.lcurve.org/ZoomShots/Zoom11.gif

If you're not outraged, you obviously fail to comprehend the numbers.

Surf over to http://www.lcurve.org -- it's a nicely interactive site.

Kaa
02-20-2010, 03:01 PM
If you're not outraged, you obviously fail to comprehend the numbers.


I am not outraged.

I like to think I comprehend the numbers.

Kaa

George.
02-21-2010, 07:55 AM
Millions of people play football. Only a few are good enough to be stars, and these make more than all the rest combined.

Millions of kids play music in their rooms or garages. Only a few are good enough to make the Top 40, and these make more and get more chicks than all the rest combined.

Millions of people dabble in politics, from school boards to neighborhood associations. Only a few get elected to national offices, and these have more power - and end up making more money ;) - than all the rest combined.

Millions of people write novels. Only a few make the NY Times bestsellers list...

You can see where this leads. This type of skewed distribution of rewards is typical of certain systems. It doesn't matter if we like it or not. It is mathematically inevitable.

That said, it does tend to get worse when the masses don't think for themselves.

seafox
02-21-2010, 08:28 AM
so the answer ( and is it morally correct) to steal all the money made by people over a certin amount?

FDR wanted to have a 100% tax rate on ( in todays value of money) any income over 1 or 2 million. he did get a top tax rate of 92 percent. ( though I do not know at what level it kicked in. )

please note that scale was not what Bill Gates earned it was what is " net worth increased" if the value of a piece of property I own goes up all it means is I get to pay more taxes on it unless I sell it. further while I do not agree with what Gates does with his money, funding a lit of liberal groups, its his money and if it had all been taxed away what ever good the groups he wishes to suport would not be done.

sounds like freedom, at least limitled freedom to me.

TomF
02-21-2010, 08:40 AM
I am not outraged.

I like to think I comprehend the numbers.

KaaIMO it is outrageous that you are not outraged. Money certainly does not buy happiness, but the lack of it buys a lot of suffering. I would have less trouble with the upper end extreme if the rest of the global population had basic needs securely met.

Keith Wilson
02-21-2010, 10:06 AM
FDR wanted to have a 100% tax rate on ( in todays value of money) any income over 1 or 2 million.That wasn't FDR, that was Huey Long. Very, very different. Huey Long is the sort of fellow I was talking about when I say that FDR saved US capitalism.

The high top bracket continued through 1960, and seemed to work OK. People got very clever about shifting income to make it non-taxable.

US top marginal income tax rate:
http://upload.wikimedia.org/wikipedia/commons/thumb/e/e5/MarginalIncomeTax.svg/500px-MarginalIncomeTax.svg.png
This type of skewed distribution of rewards is typical of certain systems. It doesn't matter if we like it or not. It is mathematically inevitable. It is. However, we choose how to structure the systems; they are a human invention, not a fact of nature.

pefjr
02-21-2010, 10:47 AM
[QUOTE=Nicholas Carey;2497878]



If you're not outraged, you obviously fail to comprehend the numbers.

QUOTE]What's your point? This should outrage someone not at the top right? Why? Are you suggesting the successful should have to give up their success, forfeit their earnings, maybe serve some time in prison for being such a successful business man. The lottery winner should not get to enjoy winning the lottery and should hide his head in shame. Would it satisfy you to see this 1% give it all away. You do not understand human nature, and the motivations of mankind. I am irritated(enough to write this but not outraged) that there are a large numbers of have nots that are jealous of the haves to the point of being outraged by success and want to change things around so that the unproductive receive enough handouts to remain unproductive. Maybe these "numbers of have nots" should spend their time innovating to become a "have" and then give it all away. Do you see that happening? Why? Human nature.

We now need to bow our heads and thank Bill Gates and others for having the incentive to produce the elements of our current communication, otherwise you would not be outraged and I would not be irritated.:D And don't ever try to tell me what to do with my money!

I can visualize you and John Smith as kids playing Monopoly. After losing, the two of you attacking and beating up the kid that won the game simply because he was more successful.:D

John Smith
02-21-2010, 10:55 AM
Millions of people play football. Only a few are good enough to be stars, and these make more than all the rest combined.

Millions of kids play music in their rooms or garages. Only a few are good enough to make the Top 40, and these make more and get more chicks than all the rest combined.

Millions of people dabble in politics, from school boards to neighborhood associations. Only a few get elected to national offices, and these have more power - and end up making more money ;) - than all the rest combined.

Millions of people write novels. Only a few make the NY Times bestsellers list...

You can see where this leads. This type of skewed distribution of rewards is typical of certain systems. It doesn't matter if we like it or not. It is mathematically inevitable.

That said, it does tend to get worse when the masses don't think for themselves.
Whle you are correct, the problem as I expressed it was that kids that play football really well get their college paid for whether they have an academic propensity or not. That's because there's a lot of money in football.

My view is that there's more than enough money in football to have a few academic scholarships that pay for four years of college for those that show brilliance in math, science, etc. but don't don't have any great athletic ability.

For every 5 athletic scholarships, let's have 1 academic sholarship of similar value.

Which student of today is more likely to create more efficient cars of tomorrow?

John Smith
02-21-2010, 11:03 AM
so the answer ( and is it morally correct) to steal all the money made by people over a certin amount?

FDR wanted to have a 100% tax rate on ( in todays value of money) any income over 1 or 2 million. he did get a top tax rate of 92 percent. ( though I do not know at what level it kicked in. )

please note that scale was not what Bill Gates earned it was what is " net worth increased" if the value of a piece of property I own goes up all it means is I get to pay more taxes on it unless I sell it. further while I do not agree with what Gates does with his money, funding a lit of liberal groups, its his money and if it had all been taxed away what ever good the groups he wishes to suport would not be done.

sounds like freedom, at least limitled freedom to me.
Nonsense. When Bush's tax cuts were being argued, I had many a poster on the forums I was on back then arguing that Bill Gates couldn't make any money under Clinton's tax rates.

I' also tired of the old adage that when taxes are cut revenues go up. If this were true, let's elimate all taxes and the government would be swimming in money.

The fact is Bill Gates wouldn't have made any money if all those millions and millions of "middle class" folks couldn't afford to buy computers.

$4 a gallon gas didn't hurt Gates, directly. You can bet, however, that it cut into sales of new computers. You can also bet it made it more difficult to people to make their mortgage payments.

This nation has designed itself into a mode where it's prosperity depends on a prosperous middle class. The middle class doesn't need a hell of a lot to be prosperous: they need health care, a decent secure job, better, more affordable educational opportunities, and a fair shot at the American dream.

If the middle class dies, so does America.

John Smith
02-21-2010, 11:05 AM
That wasn't FDR, that was Huey Long. Very, very different. Huey Long is the sort of fellow I was talking about when I say that FDR saved US capitalism.

The high top bracket continued through 1960, and seemed to work OK. People got very clever about shifting income to make it non-taxable.

US top marginal income tax rate:
http://upload.wikimedia.org/wikipedia/commons/thumb/e/e5/MarginalIncomeTax.svg/500px-MarginalIncomeTax.svg.pngIt is. However, we choose how to structure the systems; they are a human invention, not a fact of nature.
Donald Trump made an interesting comment on tax rates. If his tax rates are high, he finds ways to lower them, and most of those ways create jobs. When the tax rates drop, he just pays the taxes.

John Smith
02-21-2010, 11:07 AM
[QUOTE=Nicholas Carey;2497878]



If you're not outraged, you obviously fail to comprehend the numbers.

QUOTE]What's your point? This should outrage someone not at the top right? Why? Are you suggesting the successful should have to give up their success, forfeit their earnings, maybe serve some time in prison for being such a successful business man. The lottery winner should not get to enjoy winning the lottery and should hide his head in shame. Would it satisfy you to see this 1% give it all away. You do not understand human nature, and the motivations of mankind. I am irritated(enough to write this but not outraged) that there are a large numbers of have nots that are jealous of the haves to the point of being outraged by success and want to change things around so that the unproductive receive enough handouts to remain unproductive. Maybe these "numbers of have nots" should spend their time innovating to become a "have" and then give it all away. Do you see that happening? Why? Human nature.

We now need to bow our heads and thank Bill Gates and others for having the incentive to produce the elements of our current communication, otherwise you would not be outraged and I would not be irritated.:D And don't ever try to tell me what to do with my money!

I can visualize you and John Smith as kids playing Monopoly. After losing, the two of you attacking and beating up the kid that won the game simply because he was more successful.:D
I rarely lost Monopoly.

TomF
02-21-2010, 11:09 AM
...You do not understand human nature, and the motivations of mankind. I am irritated(enough to write this but not outraged) that there are a large numbers of have nots that are jealous of the haves to the point of being outraged by success and want to change things around so that the unproductive receive enough handouts to remain unproductive. Maybe these "numbers of have nots" should spend their time innovating to become a "have" and then give it all away. Do you see that happening? Why? Human nature...
Pefjr,

There are about 15 countries in the world where the average gross income per capita is less than $1000. When my son can babysit for an evening and come home with more than a week's income for a head of household in such a place, there's more at play here than simply laziness and lack of innovation or initiative. Don't slough it off to different wage rates and prices either; that $30 won't purchase what you or I would call a reasonable lifestyle for a week in Congo, Lesotho, or Zambia.

When people stop dying from a combination of poverty and overwork, we can talk about how much the rich ought to be allowed to keep from their incomes.

oznabrag
02-21-2010, 11:19 AM
What's your point? This should outrage someone not at the top right? Why? Are you suggesting the successful should have to give up their success, forfeit their earnings, maybe serve some time in prison for being such a successful business man. The lottery winner should not get to enjoy winning the lottery and should hide his head in shame. Would it satisfy you to see this 1% give it all away. You do not understand human nature, and the motivations of mankind. I am irritated(enough to write this but not outraged) that there are a large numbers of have nots that are jealous of the haves to the point of being outraged by success and want to change things around so that the unproductive receive enough handouts to remain unproductive. Maybe these "numbers of have nots" should spend their time innovating to become a "have" and then give it all away. Do you see that happening? Why? Human nature.

We now need to bow our heads and thank Bill Gates and others for having the incentive to produce the elements of our current communication, otherwise you would not be outraged and I would not be irritated.:D And don't ever try to tell me what to do with my money!

I can visualize you and John Smith as kids playing Monopoly. After losing, the two of you attacking and beating up the kid that won the game simply because he was more successful.:D

The 92% marginal tax rate worked very well BECAUSE, to the people who were making that much money, money is essentially meaningless.

After you've gotten all your basic needs met, AND a vacation home AND a nice yacht AND etc., etc., etc., Money is just a meaningless number. Unless of course you're Dr. No, or some such, and want to take over the world.

A 92% marginal rate keeps the people who earn so much from becoming a threat to global political stability.

It is clear that you are willfully ignorant, Pefster. Over and over and over. What you are overlooking in your typical, obtuse way is that We The People ENABLE the accumulation of such wealth; of such 'success', and it is only right and just and fair that those who have accumulated outrageous fortune be required to re-circulate that money. It is wrong and unjust and unfair that those who earn the least should also pay the most for keeping the system in place that allows the accumulation of outrageous fortune.

Once again, you've demonstrated that your moral compass is gummed up with greed, and your willful ignorance of anything other than your ideology of greed prevents your actually thinking about the issue.

You are one pitiful specimen, Peffy.

Get over yourself.

pefjr
02-21-2010, 11:25 AM
Pefjr,

There are about 15 countries in the world where the average gross income per capita is less than $1000. When my son can babysit for an evening and come home with more than a week's income for a head of household in such a place, there's more at play here than simply laziness and lack of innovation or initiative. Don't slough it off to different wage rates and prices either; that $30 won't purchase what you or I would call a reasonable lifestyle for a week in Congo, Lesotho, or Zambia.

When people stop dying from a combination of poverty and overwork, we can talk about how much the rich ought to be allowed to keep from their incomes.Tom, I would like for you to feel free and unencumbered to send all of your excess money and assets not needed for your family to survive to prop up whatever unproductive you care to. I'll pm you with my sad story and address, thank you in advance.:D

TomF
02-21-2010, 12:08 PM
I truly don't get it. They're people, no different from you or me, your parents/kids or mine. And they're no more to blame for being born without advantages/opportunities than we are to be credited for being born with them.

Whatever, man; your funeral.

Nicholas Carey
02-21-2010, 02:56 PM
The problem, perfjr, kaa, et al, is that we live in a representive democracy that is built in every person having an equal voice in what happens. The courts have held that money is somehow equal to speech.

We have a distribution of wealth so highly skews as to be laughable -- 90% of the wealth is controlled by 10% of the population. And the distribution is exponential. If you look at the wealth controlled by the top 10% of the population, 90% of that is controlled by the top 10%. Repeat. A very few people control some 95% of this country's wealth. Consider the area under the L-curve (the total amount of wealth), 99% of the area under the curve lies somewhere to the right of the 99th percentile.

Given the courts holdings that money is somehow equivalent to speech, the skewedness of the wealth distribution giving so few such a large voice endangers democracy itself.

John Smith
02-21-2010, 03:45 PM
The problem, perfjr, kaa, et al, is that we live in a representive democracy that is built in every person having an equal voice in what happens. The courts have held that money is somehow equal to speech.

We have a distribution of wealth so highly skews as to be laughable -- 90% of the wealth is controlled by 10% of the population. And the distribution is exponential. If you look at the wealth controlled by the top 10% of the population, 90% of that is controlled by the top 10%. Repeat. A very few people control some 95% of this country's wealth. Consider the area under the L-curve (the total amount of wealth), 99% of the area under the curve lies somewhere to the right of the 99th percentile.

Given the courts holdings that money is somehow equivalent to speech, the skewedness of the wealth distribution giving so few such a large voice endangers democracy itself.

It always seems to me that the people who own 90% of the wealth should pay 90% of the taxes. That seems fair. consider the people who own 10% of the wealth paying 50% of the taxes and explain how that's fair.

Further, not to pick on Gates, but if there was not the government provided infrastructure that got the computers with his program in them to the consumers, he'd not sell much.

This infrastrucure includes the wireless/satellite programs orders are made via, the dredged harbors and channel markings that allow ships carrying his product into various countries. It includes the roads trucks drive over to get those computers to the stores, or UPS et al drive over to bring to the customer's homes. Also the airports that carry some of the freight.

The malls where we shop use running water provided by government developed resevoirs systems, and electricity provided through government provide systems.

The old adage that a rising tide lifts all boats is true.

paladin
02-21-2010, 04:30 PM
Tom F....you're comparing apples and oranges.....how many of those "poor" countries have you lived in? I've lived for a minimum of a year (usually 18 months at a time) in many countries....My salary was 32K to 165K per annum.
In countries where my salary was relatively low, most of it went to savings in the U.S. or HKSB. If you try to live American style in some of those countries you're wasting your money.
General wages for a "poor" citizen was about $20 U.S. a month while I was there.But....a young lady that I was living with's father made about 20-25 dollars a month at a sari sari store, a kind of small general store that sold general wares. He managed to buy a small piece of land, build a house, and support a half dozen kids in the process. Similar in Thailand....The lady that took care of my house and shopping was paid $7 a month...she paid for a house and raised two kids without a husband (she threw him out for drinking and gambling her earnings). That money paid for her utilities, food, etc....she managed to save a few baht.......the difference in those countries is there is no income tax etc...there may be sales tax on luxury items and other government programs funded through duties etc. I lived like a local. Iused the local hospital, I ate pretty much local food. I did own a luxery item. First I owned a 90 cc Honda bike, then in Thailand I bought a Mazda pickup and used it at the boatyard. In the Philippines I bought a few airplanes....some were for fun, some for business, but ON THE ECONOMY, when I went home at night, I lived like a local.

TimH
02-21-2010, 05:41 PM
Microsoft has been considered to be a stifle of innovation. Their business practices have generally been questionable.

pefjr
02-21-2010, 06:21 PM
Microsoft has been considered to be a stifle of innovation. Their business practices have generally been questionable.Don't argue with success.

Kaa
02-21-2010, 07:32 PM
IMO it is outrageous that you are not outraged.

LOL. So go ahead and be outraged at my lack of outrage. I'll watch and snicker.


Money certainly does not buy happiness, but the lack of it buys a lot of suffering.

Funny things happen to societies that take all or most of the money from the rich and redistribute it to the poor...

Kaa

Kaa
02-21-2010, 07:35 PM
However, we choose how to structure the systems; they are a human invention, not a fact of nature.

Not so fast. Humans can attempt to structure the systems as they think is best -- but the result is not guaranteed to match the vision.

For all the attempts to produce a truly egalitarian society, in hundreds and hundreds of years, nobody managed to do it.

There are LOTS of limits on how humans' social structures can work.

Kaa

Kaa
02-21-2010, 07:36 PM
When people stop dying from a combination of poverty and overwork, we can talk about how much the rich ought to be allowed to keep from their incomes.

Africa is an excellent example of the observation that throwing money at poor societies does not make them less poor.

Kaa

oznabrag
02-21-2010, 07:38 PM
LOL. So go ahead and be outraged at my lack of outrage. I'll watch and snicker.



Funny things happen to societies that take all or most of the money from the rich and redistribute it to the poor...

Kaa

Nobody's talking about confiscating all of the money. I would like to see a return to a 92% marginal tax rate.

The funny thing that happened to our society was that it became a prosperous manufacturing powerhouse the likes of which have not been known since. Are you simply against America? Why do you hate Americans?

TomF
02-21-2010, 07:43 PM
Chuck? I've just lived in Canada. But my parents spent 7 years in favellas in northeastern Brazil, and my aunt about 30 years in parts of Central America and Africa. Sister-in-law just got back from Kenya, where she'd lived with a middle-class local. Brother spent time with the poor in Manila back in the last year of Marcos' administration.

True, one can live on much less - but one lives very differently, living as a local on locals' wages. It is not typically the type of lifestyle most North Americans would settle for, much less aspire to. And the poor there, live quite an order of magnitude of a different life than the poor here.

Kaa
02-21-2010, 07:55 PM
I would like to see a return to a 92% marginal tax rate.

That's fine -- go vote for a candidate who promises that.

Kaa

pefjr
02-21-2010, 08:08 PM
Given the courts holdings that money is somehow equivalent to speech, the skewedness of the wealth distribution giving so few such a large voice endangers democracy itself.[QUOTE]

Some how?

[QUOTE]The problem, perfjr, kaa, et al, is that we live in a representive democracy that is built in every person having an equal voice in what happens

That's a problem?

[QUOTE]The courts have held that money is somehow equal to speech.[QUOTE]

Courts don't rule on somehow's. If you are referring to the recent USSC ruling, They ruled on the constitutionality of the law. Congress can write a new law anytime they want. You guys have the power, use it. In fact Obama promised a "forceful response" I assume he means a law written that is constitutional. He is a lawyer, right? "Forceful" is not a word I would have chosen. And I would not argue with the Supreme Court, as they are part of our Gov't and deserve the same respect he would like.

B_B
02-21-2010, 08:25 PM
Tom F....you're comparing apples and oranges.....how many of those "poor" countries have you lived in? I've lived for a minimum of a year (usually 18 months at a time) in many countries....My salary was 32K to 165K per annum.
In countries where my salary was relatively low, most of it went to savings in the U.S. or HKSB. If you try to live American style in some of those countries you're wasting your money.
General wages for a "poor" citizen was about $20 U.S. a month while I was there.But....a young lady that I was living with's father made about 20-25 dollars a month at a sari sari store, a kind of small general store that sold general wares. He managed to buy a small piece of land, build a house, and support a half dozen kids in the process. Similar in Thailand....The lady that took care of my house and shopping was paid $7 a month...she paid for a house and raised two kids without a husband (she threw him out for drinking and gambling her earnings). That money paid for her utilities, food, etc....she managed to save a few baht.......the difference in those countries is there is no income tax etc...there may be sales tax on luxury items and other government programs funded through duties etc. I lived like a local. Iused the local hospital, I ate pretty much local food. I did own a luxery item. First I owned a 90 cc Honda bike, then in Thailand I bought a Mazda pickup and used it at the boatyard. In the Philippines I bought a few airplanes....some were for fun, some for business, but ON THE ECONOMY, when I went home at night, I lived like a local.
In the 1980's there were about 60,000 Philippinos living in Winnipeg Manitoba - out of a city population of about 600,000. i.e. 10% of the population of some crummy town in the middle of nowhere, Canada, were from the Philippines. At one point Winnipeg had more Philippinos than any place on the planet outside the Philippine archipelago.

They certainly weren't there because life in the Philippines was wonderful. Almost every single immigrant from the Philippines to Winnipeg, in the 60's and 70's came from middle class/upper middle class backgrounds - there is a reason they decided leaving the Philippines, leaving their families, leaving their lives their homes, their history and in many cases family land and businesses, and putting up with Winnipeg, was a better choice for them.

The poverty problem is chronic underemployment - absolutely one can, if one has steady employment, make do with $2 a day. But I highly doubt you'd choose that way of life right now?

EDIT: when I was born in Malawi (often called the poorest country in the world) the days wage for a labourer was 4cents - the cost of a loaf of bread was 5cents. When I went back there three years ago the numbers had changed but the reality was the same - work a whole day (no 8 hr, lunch hr, 2 coffee break days) and you still couldn't buy a loaf of bread. The economic realities are different (one can grow food there, I can't here, I can't buy a house for less than $70,000 here, $70,000 there buys me a lifetime of very modest living) but I sure wouldn't want to earn their 'minimum wage' for very long...

pefjr
02-21-2010, 09:34 PM
In the 1980's there were about 60,000 Philippinos living in Winnipeg Manitoba - out of a city population of about 600,000. i.e. 10% of the population of some crummy town in the middle of nowhere, Canada, were from the Philippines. At one point Winnipeg had more Philippinos than any place on the planet outside the Philippine archipelago.

They certainly weren't there because life in the Philippines was wonderful. Almost every single immigrant from the Philippines to Winnipeg, in the 60's and 70's came from middle class/upper middle class backgrounds - there is a reason they decided leaving the Philippines, leaving their families, leaving their lives their homes, their history and in many cases family land and businesses, and putting up with Winnipeg, was a better choice for them.

The poverty problem is chronic underemployment - absolutely one can, if one has steady employment, make do with $2 a day. But I highly doubt you'd choose that way of life right now?

EDIT: when I was born in Malawi (often called the poorest country in the world) the days wage for a labourer was 4cents - the cost of a loaf of bread was 5cents. When I went back there three years ago the numbers had changed but the reality was the same - work a whole day (no 8 hr, lunch hr, 2 coffee break days) and you still couldn't buy a loaf of bread. The economic realities are different (one can grow food there, I can't here, I can't buy a house for less than $70,000 here, $70,000 there buys me a lifetime of very modest living) but I sure wouldn't want to earn their 'minimum wage' for very long...There is a large # of Filipinos living in Las Vegas, not sure on the number. The happiest group of people I have ever know. They go back to the Islands every so often, sometimes for a yr. or two, but most always come back. Their children are well behaved too.

seanz
02-22-2010, 06:08 AM
A guy, $100m net worth, buys $100K of short-term out-of-the-money options on oil price. Speculation or investment?

A guy, pretty much zero net worth, buys a house. Speculation or investment?

A guy, $500K net worth, puts half of his retirement money into GM stock in 2007. Speculation or investment?

A guy buys some gold coins because he thinks gold price is going to go up in the near future. Speculation or investment?

The twin brother of the previous guy also buys exactly the same amount of gold coins, but the reason is he distrusts paper currencies and thinks gold is more solid. Speculation or investment?

A guy buys some stock of company X because he likes the long-term prospects of the company. Speculation or investment? Next day he changes his mind and sells his position. Now, was it speculation or investment?



Oh, I have, it's just that this sort of thing has been profoundly unsatisfying... :-)

Kaa

Shortly after you try to explain the difference between investment and speculation to someone that should already know the difference but refuses to acknowledge it, you are asked a number of seemingly random questions.
Should you answer them?
Where is the profit in that?

You know, you could have offered some sort of rebuttal...........:rolleyes:

You have some expertise in the field, perhaps?

George.
02-22-2010, 07:56 AM
T... we choose how to structure the systems; they are a human invention, not a fact of nature.

But they are still constrained by human nature. You can structure it so it is not quite as skewed, but it will always be inherently skewed.

John Smith
02-22-2010, 09:04 AM
I don't think many here look at the bigger picture. Humans are human, and try as we may, we will not eliminate crime, greed, jealously, anger, hate, and a number of other things.

However, for a society to function, even a capitalist society, it needs some socialism.

Private companies can ship goods more efficiently because the government dredges the harbors and puts in place and maintains the channel markings. Airlines can function because the government provides airports.

Trucks can deliver their goods to consumers over government made highways.

How many Pizza Huts, McDonald's, etc. would there be if the government hadn't provided the infrastucture that gets both the products and the customers to the restaurants?

What some call re-distribution of wealth, I call the circulation of money necessary to keep the society going. If the middle class is squeezed to hard, fewer will eat at those Pizza Huts, and their profits will fall.

If the middle class is unable to consume, stocks go down. Wealthy lose money.

Everyone in this system benefits from a healthy and prosperous middle class. That's the heart of this nation's economy. When they cannot consume, it hurts everyone, including the federal treasury.

The wealthy, if they want to stay wealthy, have a vested interest in the middle class doing well.

TomF
02-22-2010, 09:31 AM
But they are still constrained by human nature. You can structure it so it is not quite as skewed, but it will always be inherently skewed.Precisely; it will be skewed. Some skewing is both to be expected in the natural course of things, and quite frankly, good.

Extreme skewing is, IMO, neither.

George.
02-22-2010, 10:02 AM
Too much skewing is what's bad. The middle class must outweigh the rich and the poor put together, in power and earnings, or there will be no stability.

hokiefan
02-22-2010, 10:06 AM
Whle you are correct, the problem as I expressed it was that kids that play football really well get their college paid for whether they have an academic propensity or not. That's because there's a lot of money in football.

My view is that there's more than enough money in football to have a few academic scholarships that pay for four years of college for those that show brilliance in math, science, etc. but don't don't have any great athletic ability.

For every 5 athletic scholarships, let's have 1 academic sholarship of similar value.

Which student of today is more likely to create more efficient cars of tomorrow?

John, there is a lot of academic scholarship money out there. A lot. But you need to graduate in the top of your class in high school and go looking for it. Anecdotally, its as easy to get as athletic scholarship money.

Cheers,

Bobby

TimH
02-22-2010, 10:35 AM
It seems like they should know this. To me it looks like they are just grabbing what they can before the collapse of the middle class.
There is a mad scramble going on to cut the American middle class out of the picture. Like you say - we are in this together. China and India arent consumer enough to replace the American middle class. Very short sighted thinking going on right now.



I don't think many here look at the bigger picture. Humans are human, and try as we may, we will not eliminate crime, greed, jealously, anger, hate, and a number of other things.

However, for a society to function, even a capitalist society, it needs some socialism.

Private companies can ship goods more efficiently because the government dredges the harbors and puts in place and maintains the channel markings. Airlines can function because the government provides airports.

Trucks can deliver their goods to consumers over government made highways.

How many Pizza Huts, McDonald's, etc. would there be if the government hadn't provided the infrastucture that gets both the products and the customers to the restaurants?

What some call re-distribution of wealth, I call the circulation of money necessary to keep the society going. If the middle class is squeezed to hard, fewer will eat at those Pizza Huts, and their profits will fall.

If the middle class is unable to consume, stocks go down. Wealthy lose money.

Everyone in this system benefits from a healthy and prosperous middle class. That's the heart of this nation's economy. When they cannot consume, it hurts everyone, including the federal treasury.

The wealthy, if they want to stay wealthy, have a vested interest in the middle class doing well.

Kaa
02-22-2010, 11:34 AM
Shortly after you try to explain the difference between investment and speculation to someone that should already know the difference but refuses to acknowledge it, you are asked a number of seemingly random questions.
Should you answer them?
Where is the profit in that?

No profit :-)

Perhaps I should be more explicit. I don't think there's much difference between investment and speculation with the notable exception of the attitude flavour: investment is "good" and speculation is "bad".

The usual criteria offered to distinguish the two are either length (investment is long-term, speculation is short-term), or perceived risk (investment is less risky, speculation is more risky), or even the asset class (buying stocks is investment, buying options is speculation). I don't think any of these criteria works well and it seems to me, again, that people just call something "investment" when they approve, and call something "speculation" when they don't approve.

Kaa

Popeye
02-22-2010, 01:31 PM
no need to be confused sean-zee,
here is what the mass of conflicting impulses is saying ..



investment is less risky
speculation is more risky

investment is "good"
speculation is "bad"

I don't think there's much difference between investment and speculation
that is what she said ..

George.
02-23-2010, 07:55 AM
China and India arent consumer enough to replace the American middle class.

Yes they are. They have just started to buy stuff Americans already have, there are many more of them, and they haven't even started going into debt.

The global economy could function quite well with a few super-rich in the rich countries, along with whatever service jobs they require and can't outsource over the internet, and a mass of cheap labor and emerging junk consumers in the developing world. The rest are superfluous, and will get by on whatever dole they can get.