Real Time discusses income inequality and the Great Depression

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  • #26
vanesch
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That would be the dogma of the mob (or perhaps Robespierre), not a constitutional democracy. C'mon that has a hole a mile wide and centuries of history posting warning signs en-route to the hole. Slavery was once considered a good for the majority. There are certain basic human freedoms that the majority, even in unanimity, does not have the right to infringe. Perhaps the state has the power, granted by the people, to in act very restrictive velvet glove labor laws, but lets not pretend that the state does not simultaneously reduce the liberty of others by doing so.
That is because you have a very specific view on what is "good". As you say, for Robbespierre, "good" was something entirely different. For Marx, also. For Ayatollah Khomeini, again it was something else, and for the Pope, it is still something different. It is because you have already assigned pre-determined values of goodness to certain concepts (freedom for instance) that these induce you to make those value statements.
Total absence of liberty could be seen as something good in a certain doctrine, so anything that would grant liberty to individuals would be something to be suppressed and fought.

Our western democracies seem to have a common set of values, but in the details they differ, and there's no way to say that one view is "better" than the other, simply because they are different weight functions for what "better" means in the first place.
It is as if you wanted to assign probabilities to different probability measures.

And it is in that light that one needs to see the different attitudes towards things like the free market. Proponents of a totally free market claim that it is the "best" because it generates wealth, it is supposed to have some "fairness" in it (you get what you deserve), it respects certain forms of freedom (freedom to undertake) etc...
But the answer to that is that those goals are not necessarily, in a given doctrine, seen as what is "the ultimate good". However, it is true that most doctrines in the West do put some positive value upon those aspects - wealth IS currently valued, fairness IS somehow seen as something that could be valuable, freedom to undertake IS seen as something that might be considered positive. So that's why most of these doctrines do promote some form of free market. But one shouldn't forget that that is just up to a point, an arbitrary choice of the moment, and that those values could be in competition with other values, which are NOT automatically instored by a totally free market, and for which then regulations are applied, to get more or less what one desires (or not, if one does it badly).

For instance, I could be of the opinion that the highest value is scolarly knowledge. That it doesn't matter what people have to eat (as long as it doesn't threaten their basic life functions for a certain part of them), that it doesn't matter what they feel or think. The only thing that matters is that scientific knowledge is advanced and known. Even if that means that 3/4 of the population has to live in terrible circumstances. "Good" = "theoretical science advances and is read and known". Well, the free market is not going to instore that automatically. Replace this with 'biblical knowledge' and we have the doctrine of the European Middle ages.
 
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  • #27
Astronuc
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Socio-economics systems work well when self interest = common interest (or common good).

Interest on credit redistributes wealth as effectively as taxes.
 
  • #28
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Originally Posted by LightbulbSun

Correct me if I'm wrong on this, but it seems like Obama's economic policies are centered around increasing taxes on the rich (the ones who makes $250,000 or more a year) and evenly distributing the wealth. Is this just a quixotic idea or will this actually improve economic growth?
That idea is the very essence of socialism and will undoubtably stifle growth.
But, he isn't proposing any drastic tax increases for those earning above a quarter of a million, right? If I recall correctly, and I'm not exactly sure about the numbers, but he's just calling for a return to the tax rates under Clinton, when the economy wasn't doing all that bad. Combining that with a tax cut for the vast majority (95%, I think) of working Americans, the consumers who will drive the economy, shouldn't be some kind of a revolutionary turn towards a socialist or Marxist economy.
 
  • #29
russ_watters
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:confused: What on earth has freedom/democracy got to do with the subject at hand?? It's not as if we socialist Europeans live in countries whose internet usage is monitored and recorded, whose phone calls are listened into by the gov't and who holds prisoners without charge in secret prisons whilst torturing them; or even in countries where elections are settled in gov't appointed courts rather than through the ballot box. :rolleyes:
I'm confused too. I don't see how anything I said in any way implied that characterization.
You refer to shorter working weeks and longer vacations as if they are a negative in society. Perhaps you should consider the possibility that quality of life is an important consideration for most people which is greatly enhanced by spending more leisure time with friends and family. If longer working weeks and less leisure time is your goal then perhaps a slavocracy would by your ideal society.
That's a choice people are free to make in the US but not free to make in Europe. In the US, though, people tend to choose the longer work weeks because it means they have more money and therefore can buy the "stuff" that Americans love so much. If an American wants more free time and less "stuff" they are entitled (and many choose it). If a European wants more "stuff" and less free time, they are not.
 
  • #30
russ_watters
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I find this socialist-capitalist opposition rather sterile and outdated. I think it is clear that a pure free market is out of the question and a pure state-controlled economy doesn't work ; what most western democracies go for is a regulated market, where the market is essentially left free, but where certain democratically desired features that are not achieved by market forces are put in by regulation - by hard law, or by incentives such as taxes and fees.
You are, of course, right - the main sticking point here is just in where to draw the line.
 
  • #31
russ_watters
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It is the old chicken and egg thing.
No, it really isn't. There is a reason that Microsoft (by that I mean the computer and internet revolutions) was started in the US and not in Europe. The structure of the American economy and political system made it much more likely to happen here than anywhere else.
 
  • #32
russ_watters
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Socio-economics systems work well when self interest = common interest (or common good).
That's a pretty bold claim - could you provide one example of where it has been true on a national level (in modern times)? It sounds to me like something Marx would say and AFAIK, it has never been true. People often dream of a cooperative society, but dreams are not reality and wishing for them doesn't make them happen.
Interest on credit redistributes wealth as effectively as taxes.
That sounds like an odd statement to me - could you explain a little more what you mean? It would seem to me that the profit from interest goes to banks and investors and does not get redistributed. The whole issue of wealth inequality is one of investment income, is it not?
 
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  • #33
Office_Shredder
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I'm confused too. I don't see how anything I said in any way implied that characterization. That's a choice people are free to make in the US but not free to make in Europe. In the US, though, people tend to choose the longer work weeks
Because if they say they want more vacation time someone else gets hired instead
 
  • #34
vanesch
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That's a pretty bold claim - could you provide one example of where it has been true on a national level (in modern times)? It sounds to me like something Marx would say and AFAIK, it has never been true.
I think you misunderstood Astronuc (or otherwise, I did). I think he said about exactly the opposite of what you argue against, namely that if we cannot structure society such that whatever we desire as common interest, will also be driven by selfish self-interest, then it is not going to work. The most obvious violation of that idea is the idealistic communist vision, where we should all work for the common interest, while that is not really promoted when you just selfishly look at your own advantages. It is probably the reason why it didn't work. It is essentially Adam Smith's basic thesis.

And maybe I should shut up and let Astro explain what he said :tongue:
 
  • #35
vanesch
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Because if they say they want more vacation time someone else gets hired instead
That's indeed the reason. You cannot go to your boss and tell him: hey, I'd like to work a bit less, I don't mind a lower salary. I do want an interesting job, and responsibilities. But in moderate amounts. Legally, you could. But it won't work.

You don't get hired for that. It is not the looked-for profile of the desired collaborator. So people who would actually settle for less, and take it a bit cooler, just HAVE to compete with those who want to go hard and earn much. In that case, they'll also earn more, but they don't desire this. They'd prefer to do it slower. The winner takes it all.

So we have two different views:
1) leave the job market totally free, and force high working rates and high salaries upon everybody
OR
2) regulate the job market and force medium or low salaries and leisurely working rates upon everybody

Of course, the economy will do better with 1). But if 2) is what is democratically desired for, then I don't see what is *a priori* wrong with it - on the condition that one understands what it means: higher unemployment, lower wages, smaller growth, less wealth.
 
  • #36
Of course, the economy will do better with 1). But if 2) is what is democratically desired for, then I don't see what is *a priori* wrong with it - on the condition that one understands what it means: higher unemployment, lower wages, smaller growth, less wealth.
Might not choice 2 mean no impact on wealth and growth (in terms of GDP), less unemployment (more people working, but less hours of work and lower pay on average), and a larger population with some sustainable "wealth"... with possible huge benefits on national health (via the fact that vacations are shown to help this... as well as better heath/nutrition for perhaps now employed "lower classes"). Of course national health care would make this more feasible, since benefits (especially those effecting health) are often tied to employment status. Just a thought.
 
  • #37
vanesch
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Might not choice 2 mean no impact on wealth and growth (in terms of GDP), less unemployment (more people working, but less hours of work and lower pay on average), and a larger population with some sustainable "wealth"... with possible huge benefits on national health (via the fact that vacations are shown to help this... as well as better heath/nutrition for perhaps now employed "lower classes"). Of course national health care would make this more feasible, since benefits (especially those effecting health) are often tied to employment status. Just a thought.
Yes, that's more or less the "French left's dream". But what didn't work out well, was the "redistribution of employment". It is that famous "35 hour week" which converted in 50 days off per year which was the French left's idea to diminish unemployment (the reasoning being: given that workers will work less, employers will have to hire more, and hence this will reduce unemployment). With the proposition came the decision to freeze wages for 3 or more years, to compensate. However, studies demonstrated that the effects on unemployment were minimal. What had more effects was the lowering of social taxes, rendering employment conditions more flexible and things like that.

Under Sarkozy, we're getting closer to a bit more free market situations. But even though in France he's seen as a right wing guy, I take him as a social-democrat who ignores himself :smile:
 
  • #38
mheslep
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...(via the fact that vacations are shown to help this... as well as better heath/nutrition for perhaps now employed "lower classes")...
Some vacation time sure, but where does it possibly show that 50 days a year off increases health significantly over, say, 21?
 
  • #39
vanesch
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Some vacation time sure, but where does it possibly show that 50 days a year off increases health significantly over, say, 21?
I don't know. Probably it lowers life expectancy, as people go more on trips ?
Again, the initial drive was not to increase holidays, the initial drive was a political project of "redistribution of working time" to tackle unemployment. Initially, work days would simply be shorter (you'd go home at 4 pm instead of at 5 pm or so). But then workers' unions changed this into extra holidays. So that's how we got about 23 extra days off.

I can say that this is very practical if you have young kids. In fact, most of these extra days I don't use them to go on a holiday, but just to do things at home, look after the kids,... most people actually do. So it became "more time for family stuff" ; not so much more swingers time.

However, it has an undeniable negative effect on the job. It becomes difficult to have whole-department meetings, because there are always a few persons on leave (ok, this can be imposed of course). If you need to work with several collegues, you really have to sit down and plan days off, because otherwise the group is almost never complete.

So, family life got better, job life not necessarily so.
 

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