After seeing two writers disagree with a recent “Letter” I wrote the first week of March, I figured it was time to remind these forgetful conservatives of the simple principles of “Economics 101”
Reagan’s “trickle down” only trickled up...in a big way, because making rich folks richer does not put much money into the economy. They mostly sit on their excess wealth or stash it overseas to avoid taxes. And they’ve shown they are just as willing to invest in China or India as here in America.
None of those choices creates many jobs here at home! But what worked in the past can work again!
Trickle up economics, as demonstrated successfully between 1945 and 1975 by Presidents from both parties works! The government jump started the economy by creating jobs, and that increases demand, creating even more jobs!
Consumers are the ultimate creators of a robust economy as any economist will tell you! If the ‘90%’ have good incomes, they spend 85-100 percent of it, month after month, and this increases “demand” which in turn creates a need for an increased “supply.”
How do you increase the supply to meet a larger demand? You hire more workers, buy more raw product, build new factories and equipment and hire more trucks and trains to haul the supply to the demand!
Taking money from the pockets of the underpaid working class, as the Ryan “House Budget Plan” has to do to make the numbers add up, is the worst thing Congress could do right now!
The very worst!
Rod Livdahl
Mesa
VofReason posted at 1:03 pm on Tue, Mar 26, 2013.
I think Bluepoet misses the point. The artificial markets were caused by the Government also. Was it not through Government tinkering that people who never should have been able to afford purchasing a house actually got on the hook for one. Then surprise surpirse time went by and they could not afford it which cascaded into foreclosures, losses and a trail of lost jobs connected to the artificail demand for housing? Make taxes flat so that Politicians cannot pick winners and losers of tax advantage. You will be surprised to know how many current millionaires are from non wealthy families. You do understand that small businesses employ the majority of people- right?
Slabside posted at 10:36 am on Sat, Mar 23, 2013.
Abstract01, Rod is trying his best to divert attention from his God Obama's miserable failed presidencies by cherry picking items long gone by. Pay no attention to the man behind the curtain!
Abstract01 posted at 9:14 pm on Fri, Mar 22, 2013.
Rod,
When are you going to give up on the issues of 20+ years ago, and return to the 21st century?
Abstract01 posted at 9:12 pm on Fri, Mar 22, 2013.
BluePoet,
I agree with you about the "playbook". As soon as the election was determined, businesses and investors knew what the next four years would bring.
That is why you have seen an upswing in housing starts since November.
Above all, that reinforces to me the idea that big business is not liberal or conservative; corporations are not pro-Democrat or pro-Republican. They are completely AMORAL. They exist to sell goods at a profit, and whatever government policy or action gives them leverage--that is what they favor.
I, for one, don't care for the idea of offering corporations a "stimulus" package ON MY DIME, with no ROI (return on investment) for the taxpayer (not the federal government).
Rich posted at 9:09 pm on Fri, Mar 22, 2013.
You miss so much. Supply and Demand are tools or anachronisms, and we can't decide which. Since 1915 the world has had the physical capacity to supply everyone with everything. In 1929 overproduction sunk everything. Again in 2008. There are no answers, as yet, only questions. The 'middle class' is now defined as people needing jobs to contribute, when the Bourgeoisie is the entrepreneur, creator, the true middle class, and the one we look to, the middle class between the aristocrats and workers. When laws are passed to soak the rich, they choke the true middle class to death. Any man who ever ran a successful store would do a better job than Obama. But you continue your 'middle class' myth.If you meed a job to work, you aren't middle class yet. Work t it.
Mike McClellan posted at 4:59 pm on Fri, Mar 22, 2013.
Leon, notice unemployment in AZ? While it is down to 7.6 nationally, it's risen to 8 percent in AZ
Bluepoet posted at 3:50 pm on Fri, Mar 22, 2013.
VofR, I thought, at first, that you were being logical, in your assessment. However, we diverged when you equated artificial supply and artificial demand with government stimulus. That stimulus, however temporary, was in response to the artificial markets, that invested in speculation, well beyond any "real" supply and demand. The artificiality threatened to put us all in Depression. They also make for great bonuses for these rich corporations you so admire...
Regressives often talk of the market "righting itself", if left to it's own, unhindered process. This would be true, if the market was actually a free market. However, this is not the case...it's a manipulated game of chance, no more regulated than an offshore casino...
The business that starts out on day one, with dollar one, is not a problem, because they will make a small profit, or die. The problem is the big businesses that have grown to the point of power far beyond merely business, where "product" has become influence, and "service" has become chumming for the shark. And, yes, a new royalty, mostly anonymous, controls this, precisely because they control the markets (and the government).
Free market enterprise is just as much as pipe dream as the communist utopian society, and the ideal of democracy.
Millionaires? Relatively small potatoes, but even if they weren't born as millionaires, most were born to position and power. The rare ones who were not, had an invention or some technology to offer (or sport/entertainment value). Eventually, they sell to the really wealthy, with very few exceptions...
Welcome to the dystopia you haven't awakened yet to find!
VofReason posted at 1:39 pm on Fri, Mar 22, 2013.
Strange, I thought Economics 101 was supply and demand. Not artificial supply and artificail demand. If the economy is hinged on when the Government infuses loads of money into it (ala stimulus) or intiates the job growth, it is in an unsustainable state. Only when the market works by itself under true supply and demand is their stability. One thing that I never understand is why progressives talk about business as if they begin on day one as large corporations, run by some anonimous group of wealthy people who were born that way. The fact is that most millionaires today were not born as such. Further, most corporations start as small business, that make profits, grow, and provide jobs. Right?
chatmandu002 posted at 12:04 pm on Fri, Mar 22, 2013.
Rod,
Investment is well determined by profit vs expense. When the cost of doing business is to high and the return is to low the investment doesn't happen.
If investing in America was such a good deal then why aren't companies expanding and doing more business in America. Could it be the taxes are to high? The labor is to expensive? That government rules and regulations are oppressive? Would you invest in America with all this uncertainty and confusion? When the government isn't friendly to business then the business investor isn't going to invest.
Leon Ceniceros posted at 12:44 am on Fri, Mar 22, 2013.
Folks,
Every single day since our great "REPUBLICAN" Governor, Jan Brewer, took office and instituted a ....."BUSINESS FRIENDLY", job creating corporate environment for our Great State of Arizona.........WE HAVE SEEN CORPORATIONS AND BUSINESSES....BOTH LARGE AND SMALL..........."FLOCKING"....TO ARIZONA.
Cheap housing, school choice (no Chicago Teacher's Union "Strikes" here in Arizona), "right to work" pro-employer, anti-union rules, 356+ days of Sunshine, great freeway system (if the Phoenix transportation unions strike = who cares), great sports venues that are still reasonably cheap and plentiful.
WHAT MORE COULD ANY CORPORATION CEO OR BUSINESS OWNER WANT ????
SOMEONE PLEASE INFORM THE LETTER WRITER THAT YOU CAN'T HAVE CONSUMERS UNLESS YOU HAVE EMPLOYEES FIRST. HE SHOULD BE THANKING OUR...."REPUBLICAN" ....POLITICAL LEADERS ON HIS HANDS AND KNEES FOR MAKING ........ARIZONA....THE BUSINESS........"GO TO" ....STATE.
Bluepoet posted at 3:32 pm on Thu, Mar 21, 2013.
At this point in the economic cycle, I'd say the business sector just needs to know which way the government is going to go, with policy, so they can plan accordingly. If I were a business owner, I would find that more of a hindrance on hiring, or expanding my interests, than taxation, or any of the temporary fixes/approaches that have been implemented, in recent years. In other words, tell me what the playbook is, and I will work with it. Otherwise, I am forced to be even more conservative than I'd like to be, just to keep in business...
I do agree that trickle down is not a viable approach to ending or reversing a recessionary period. The stimulus was the correct approach, but it was either too little, or too slow, and probably both. Of concern, also, is that the markets are soaring again, and yet interest rates have remained low thoughout. Something has to give, in this scenario.
As to timelines and lessons of the past...I should think we've learned, by now, that we can't fund wars, without taxing for them, if nothing else. However, it seems that we are bent on repeating history, instead...
truth posted at 2:21 pm on Thu, Mar 21, 2013.
Student debt is now the second-largest category of household debt, behind mortgages, having “essentially tripled “to $966 billion in the last eight years. As many as 6.7 million people, or 17% of all student loans borrowers, are more than 90 days behind on their payments and considered “seriously delinquent.” TheStreet.com
downtownresident posted at 1:54 pm on Thu, Mar 21, 2013.
I agree.
The sad fact is that our politicians all pander to big $$ business, and could care less about the people who elected them.
Case in point, the almost quarterly artifical fiscal cliff and spending legislation.
Both of these issues are cash cows for our "leaders" and will never be solved until campaign contribution limits are imposed, and enforced. That'll never happen either.
Thete are VERY FEW ethical potiticians left anywhere.
Remember, the people in Congress are all millionaires, so they are greedy, not objective.