More economics questions

[Kepor]

Actually, concerning the profitability of manufacturing. It's known as the smiley curve, and plots profitability on the y-axis and stage of production on the x-axis.

The first stage is initial concept, and high in profitability. The next stage is design, a bit further along the x-axis, and a bit down in profitability. In the middle is resources and manufacturing, the least profitable stage in the process. Finally, at the end, is marketing and distribution, also high profitability. It's why China wants to shift from having products "made in China" to "designed, made, and sold in China."

[Odjn]

Originally Posted by Jagos

Hate to say, that's a horrible analogy. I don't think anyone necessarily wants business to have unfettered freedom to charge willy nilly (besides, most people won't afford the prices a business wants until it hits equilibrium) but that's part of the political process.

You know what, you're right. A better metaphor would be we would give him the keys BECAUSE he loves them so very, very much he knows exactly what they need. Next up, rapists in charge of women's shelters!

[Eldezar]

When you raise the minimum wage, two things happen to varying degrees: companies raise prices to offset the loss of wages, and companies lay off their least productive workers and hire fewer workers from groups they tend to discriminate against (whether it be teenagers, the elderly, minorities, women, what have you). True, the cost of their own production workers is only a portion of their budget, but the cost of purchasing things produced by other businesses' workers, which will go up in price with an increase in minimum wage, stacks on top of that cost and drives prices up further.

Like it was said before, this only happens in the short run. First example I have is a business in my area called Youngs Jersey Dairy, a dairy farm with homemade ice cream, mini-golf, corn maze and other farm-themed attractions. Mr. Young gave hell when minimum wage was going to go from $5.35 to $6.85, claiming he would go out of business, have to lay people off, etc. all the things you think will happen with increased wages.

2 1/2 years later, Ohio now has a minimum wage of $7.30. I drove by the place two weeks ago and the place was packed with cars and school buses. I will also be in the area this weekend, so I'll be sure to stop by and report on what I am sure is a full staff of employees next week.

Next example, I used to work at Wendy's. Shortly after minimum wage went up to 6.85, most items on their menu went up by .20 cents. We still had a lot of employees, most of them getting full time. I myself even managed to get 20 hours overtime for quite a few weeks in a row. This was all right after minimum wage went up. Again, 2 1/2 years later, minimum wage is $7.30, and most of the prices are back down to what they used to be, and if not back to the orignal price, they still dropped to only .05 to .10 cents more than the original.

The disparity is greater because the rich have more, not because the poor have less. You argue about this disparity as though it's a bad thing, as though all people should have an equal share of everything; why? Each person is different. Each person contributes a different amount to his or her fellow human beings, and what they receive back should be proportional to what they give. I agree that many of the rich today are there not because they are capable managers or because they contributed a good invention or discovery to humanity, but because they are able to manipulate our political system for their own gain, but I'm at least as strongly opposed to corporatism as you are. There should be disparity in society, so long as that disparity is based upon the contributions people have made to society. Also, just because the rich are getting richer much faster than the poor does not mean the poor are not getting richer (or weren't until recently); I know plenty of people who live in the ghetto and would be considered lower class who own cell phones with internet connections, big screen tvs, and have multiple cars per household. Are they poor relative to todays rich? Sure. Are they as poor as the poor of 50 years ago? Fuck no.

Disregarding the contradictions within this comment, how do you think the rich got richer? They steal, lie and cheat in order to take from the poor. (i.e. the recent bailouts.)

There is only so much money in the system. Therefore, in order for the rich to get richer, some group has to become poorer. Why not the poor, they already have so little? Since they can't do anything with what little they already have, let's give it to those who already have more than they need.

The bold statement can still be true, but not in the context that you think. That is by putting more money into the system. If we create money, and all of that new money goes to the rich, then the richer get richer because they have more, but the poor have no more or less than they already did. HOWEVER, creating more money means that the money that is out there becomes less valuable, meaning the poor still become poorer even though they still have the same amount they had before.

God, capitalism was one of the forces that helped spread democracy by creating a middle class that fought for the rights of the non-aristocratic. It's also helped develop countries, first to industrial age levels and then to modern technological levels. What a horrible system of economics! Who wants voting rights and modern technology when we could all live off the land under a monarch?

You know how well Capitalism has 'helped' developed countries? The World Bank, which is actually a private business where there has never been a non-American executive and highly unlikely to have a non-American employee aside from janitors, helps developing countries by giving them loans. These loans help the country. They get some businesses started up, decent infrastructure, a few schools, everything is nice. Then, they call in the interest, which just so happens to be just enough to put the newly developed nation back into the developing stage. Rinse and repeat.

I fail to see how capitalism being a driving force behind democracy is a bad thing, but I do see how the current corporatist investment in our democratic republic is harmful, but removing the influence of big business from government is another discussion altogether.

That actually ties in with this conversation extremely well, because it is the big businesses that 'contribute' to both the left and the right so that they can persuade them to come to a middle-grounds which best benefits the businesses. McCain was originally anti-oil, but in just one night, he had a closed door meeting with some oil executives. The next day, he was pro-oil and had a nice fat check from the oil companies donated to his campaign. This kind of thing can be found throughout history and even today with most Senators and Representatives, red and blue.

So, if businesses are able to influence politicians, don't you think they would influence them in a way that best supports their business? Therefore, lower taxes, lower minimum wage, anything for less regulation.

[ZAKtheGeek]

Originally Posted by AnonCastillo

The disparity is greater because the rich have more, not because the poor have less. You argue about this disparity as though it's a bad thing, as though all people should have an equal share of everything; why? Each person is different. Each person contributes a different amount to his or her fellow human beings, and what they receive back should be proportional to what they give. I agree that many of the rich today are there not because they are capable managers or because they contributed a good invention or discovery to humanity, but because they are able to manipulate our political system for their own gain, but I'm at least as strongly opposed to corporatism as you are. There should be disparity in society, so long as that disparity is based upon the contributions people have made to society. Also, just because the rich are getting richer much faster than the poor does not mean the poor are not getting richer (or weren't until recently); I know plenty of people who live in the ghetto and would be considered lower class who own cell phones with internet connections, big screen tvs, and have multiple cars per household. Are they poor relative to todays rich? Sure. Are they as poor as the poor of 50 years ago? Fuck no.

A big disparity is considered to be a bad thing because it implies a system where those with money are able to exploit those without; that they can accumulate wealth off of their labor without actually paying them much. A growing gap illustrates a counterexample to the common claim that "what's good for business is good for everyone;" supposedly, businesses having more money means new products, more jobs, more spending, more money cycling around, etc, resulting in cheaper and better products and services for everyone; yet what we see is that money seems to just go to the top and stay there.

[Jagos]

These loans help the country. They get some businesses started up, decent infrastructure, a few schools, everything is nice. Then, they call in the interest, which just so happens to be just enough to put the newly developed nation back into the developing stage. Rinse and repeat.

So places like Somalia, with few natural resources or Haiti with plenty of people but nothing to really develop are only third world countries because the US screwed them over?

A growing gap illustrates a counterexample to the common claim that "what's good for business is good for everyone;" supposedly, businesses having more money means new products, more jobs, more spending, more money cycling around, etc, resulting in cheaper and better products and services for everyone; yet what we see is that money seems to just go to the top and stay there.

Actually more businesses mean more jobs and spending and all that. Monopolies (Microsoft) only come up when they can control a niche market. You want the new products, and better services, have businesses fight each other. That usually does a LOT to drive down prices on things. Kinda like a $300 GB hard drive used to be ~$1500 3 or four years ago when only a few manufacturers made it.

A better metaphor would be we would give him the keys BECAUSE he loves them so very, very much he knows exactly what they need. Next up, rapists in charge of women's shelters!

Tell them don't forget the KY.

[Fifthfiend]

Disregarding the contradictions within this comment, how do you think the rich got richer? They steal, lie and cheat in order to take from the poor. (i.e. the recent bailouts.)

There is only so much money in the system. Therefore, in order for the rich to get richer, some group has to become poorer. Why not the poor, they already have so little? Since they can't do anything with what little they already have, let's give it to those who already have more than they need.

The bold statement can still be true, but not in the context that you think. That is by putting more money into the system. If we create money, and all of that new money goes to the rich, then the richer get richer because they have more, but the poor have no more or less than they already did. HOWEVER, creating more money means that the money that is out there becomes less valuable, meaning the poor still become poorer even though they still have the same amount they had before.

TBF what he mainly means - and which is true - society does create new wealth over time in terms of creating like, new life-saving technologies and consumer goods and more efficient this and better that. And his argument is more that poor people aren't so much getting more poor over time as that rich people are just taking ALL the fucking benefit of EVERYTHING NEW that anybody comes up with. And the poor are even better off because eventually the rich chew up and digest some of that wealth and shit a little of it back out onto the shit-classes!

Which is only a problem if you 1. maybe think society should share more its benefits with more than a tiny handful of people, and 2. think that having a cell phone or some shitty thirdhand-used rustbucket isn't necessarily a complete replacement for things like shittier access to medical care or needing that shitty rustbucket out of economic necessity because public transit in this country is a sick joke. Which aren't at all things that Castle is worried about, so it's all good I guess.

[Eldezar]

Originally Posted by Jagos

So places like Somalia, with few natural resources or Haiti with plenty of people but nothing to really develop are only third world countries because the US screwed them over?

No, that would be a stupid thing to say. I am saying that the U.S. (along with most other developed nations) is exploiting the weak economies of these nations. Because of this, they are hindering and negating any progress that could be made otherwise. Sure, if these nations were left alone, they would still be unlikely to develop on their own, but they still aren't receiving any substantial help.

Originally Posted by Fifthfiend

TBF what he mainly means - and which is true - society does create new wealth over time in terms of creating like, new life-saving technologies and consumer goods and more efficient this and better that. And his argument is more that poor people aren't so much getting more poor over time as that rich people are just taking ALL the fucking benefit of EVERYTHING NEW that anybody comes up with. And the poor are even better off because eventually the rich chew up and digest some of that wealth and shit a little of it back out onto the shit-classes!

Which is only a problem if you 1. maybe think society should share more its benefits with more than a tiny handful of people, and 2. think that having a cell phone or some shitty thirdhand-used rustbucket isn't necessarily a complete replacement for things like shittier access to medical care or needing that shitty rustbucket out of economic necessity because public transit in this country is a sick joke. Which aren't at all things that Castle is worried about, so it's all good I guess.

I agree with the first paragraph, could you make the second less confusing, though? It might be because it is bedtime, but just in case it still doesn't make sense tomorrow.

[Professor Smarmiarty]

[QUOTE=Jagos]


Funny, because when recessions come up, it's the USD that most investors in other countries fall back on. That, and gold.[ /QUOTE]
How is that even related to my point? The reason people go back to the US dollar is because pretty a lot of other countries economies are backed against the US dollar. So if everyone is falling, the balance of profit lies with the US dollar. It has nothing to do with taxes and regulation.

It's not really related but in addition the US economy is a gigantic tax haven if you are a large business.

Source?

Every large corporation ever.

Or volunteer for the military, do your 20 years and focus on an end objective of a house, children and being well traveled. That's what a lot of guys and girls do to get out of the ghettos of LA or wherever they are. Doesn't work for everyone but honestly, how many people can be kings or high society under a monarchy?

...... I really don't even know what to say to this. This is one of the most ridiculous arguments I've ever heard.

Originally Posted by Jagos

So places like Somalia, with few natural resources or Haiti with plenty of people but nothing to really develop are only third world countries because the US screwed them over?

Mostly the US but others had a hand too. But yes this is pretty much exactly the reason they are poor.
It was called mercantilism and through the 19th century exploitation of these countries to fund the mainlands pretty much stripped every country that wasn't in Europe or America to the bone.

Actually more businesses mean more jobs and spending and all that. Monopolies (Microsoft) only come up when they can control a niche market. You want the new products, and better services, have businesses fight each other. That usually does a LOT to drive down prices on things. Kinda like a $300 GB hard drive used to be ~$1500 3 or four years ago when only a few manufacturers made it.

And if we didn't have a monopoly, combined with the inefficient seperation of production and management, they would cost a few dollars to buy. What exactly is your point?
Also those things are much cheaper back home in one of the most isolated countries in the world with higher shipping costs. That is totally a monopoly right there.

[Bob The Mercenary]

Originally Posted by Eldezar

Disregarding the contradictions within this comment, how do you think the rich got richer? They steal, lie and cheat in order to take from the poor. (i.e. the recent bailouts.)

All of them? One of my mottos is "generalizing will kill us all". Not sure why I've been defending big business, it just seems like a rather large blanket statement you're making.

[Jagos]

Or volunteer for the military, do your 20 years and focus on an end objective of a house, children and being well traveled. That's what a lot of guys and girls do to get out of the ghettos of LA or wherever they are. Doesn't work for everyone but honestly, how many people can be kings or high society under a monarchy?

Honestly, you got PTSD, gangsta Marines, and trigger happy kids with SAWs watching your back. Where can you not find comedy?

...... I really don't even know what to say to this. This is one of the most ridiculous arguments I've ever heard.

If more people actually did that, it wouldn't be funny. *Thumbs up*

It's not really related but in addition the US economy is a gigantic tax haven if you are a large business.

Somehow, I'm not quite getting the "US is tax haven" thing when the article is saying that even Microsoft may move out of the US if Obama decides to tax them heavier. Especially when Europe is 10 points lower in corporate taxes.

What exactly is your point?
Also those things are much cheaper back home in one of the most isolated countries in the world with higher shipping costs. That is totally a monopoly right there.

Point was more competition, not less. That's what gives an incentive to create newer products. Some areas can't be regulated so the government has to step in (To my Knowledge, insulin for example).