Wild Speculation - ff on Teh Economy

[Jerome]

Where is the young couple that just bought their first home going to come up with an additional $250/month to pay the extra tax?

[chunksmediocrites]

Originally Posted by Jerome

It will be even worse when the middle-class has their mortgage interest and retirement savings taxed away.

Just like government, encourage a behavior and pull the rug out from under the worker once they are locked into a long term deal.

Source your claims please, as the context is vague at best.

[Jerome]

$200,000 mortgage with the median two-income household.

[chunksmediocrites]

You are claiming the middle class will have their mortgage interest and retirement savings taxed away- what are the tax changes, if any, you are referring to; and what is your source for this information?

...to pay the extra tax?

What extra tax are you referring to?

[SR71]

just for giggles

Housing Happiness - YouTube

&feature=player_embedded

[SR71]

Long article. I enjoyed it. "The tail is wagging the dog".

Over-financialisation – the Casino Metaphor | Feasta
My favorite paragraph -

The challenge for interstitial initiatives is the sheer pervasiveness of the FE. There are few spaces left where the effects of the FE can be ignored. They may not be well understood, but whenever we pursue dreams, they pop up in front of us, usually as obstacles. Developments that are most heavily attacked by the FE establishment perhaps merit the most attention – community scale renewable energy, crypto currencies, co-ops, the sharing economy, and so on. The more these alternative directions are attacked as utopian or uneconomic the more we can be sure they offer promising interstitial opportunities.

Here FE is Financialized Economy. The Mortgage Backed Securities fiasco would be an example of where the FE went wrong. The article talks about how the RE (Real Economy) is like the outside world to the FE and the FE is a casino. My take away lesson from that parable is that the RE could get along okay without the FE, but not the reverse.

[Hermit]

Originally Posted by SR71

Automation. You lose.

Yeah. Right. Let's smash those broadlooms and threshing machines. While they exist, massive unemployment will be permanent and universal. - Ned Ludd, 1779

[SR71]

Originally Posted by Seraph

Yeah. Right. Let's smash those broadlooms and threshing machines. While they exist, massive unemployment will be permanent and universal. - Ned Ludd, 1779

There has to be an upper limit, some saturation point, at which automation simply renders workers extraneous. I judge that we have arrived at that point, or at least at its threshold. Unemployment is a persistent problem in the OECD nations and less developed nations alike.

[ceptimus]

Unemployment shouldn't be a problem. The economy just needs to be reorganised so that goods and services (maybe via money or maybe by some other route) are distributed to people whether they're working or not.

[Hermit]

Originally Posted by SR71

There has to be an upper limit, some saturation point, at which automation simply renders workers extraneous. I judge that we have arrived at that point, or at least at its threshold. Unemployment is a persistent problem in the OECD nations and less developed nations alike.

Automation per se is not the problem. Thousands of scribbling monks - basically 90%+ of the literate, educated strata of society at the time - were put out of work by the Gutenberg press. The problem is capitalism, or more specifically, the profit motive.

[SR71]

Originally Posted by ceptimus

Unemployment shouldn't be a problem. The economy just needs to be reorganised so that goods and services (maybe via money or maybe by some other route) are distributed to people whether they're working or not.

I understand your point! In an increasingly automated world, workers become of less and less marginal utility, in the standard economic sense, and yet they continue to exist. If we accept that there is some level of general automation at which hiring workers becomes increasingly inefficient and costly in terms of producing goods and services when compared to the same output via automation, at some point we have a segment of the population that retains their needs but loses their capacity to earn wages and consume goods and services in the currently expected manner. What now becomes of them?

The decision is whether to leave them to their own devices and manage by hook or by crook, or possibly simply to fail to meet their own needs, or, provide for their needs in some way that does not involve them earning their own wages to pay for their own needs.

IOW, as much as the phrase makes me cringe, a paradigm shift. Who or what would assume responsibility to see that the needs of superfluous workers are met, especially as growing portions of population fall into the long term superfluous category?

[SR71]

Originally Posted by Seraph

Automation per se is not the problem. Thousands of scribbling monks - basically 90%+ of the literate, educated strata of society at the time - were put out of work by the Gutenberg press. The problem is capitalism, or more specifically, the profit motive.

Yes, I agree, but I don't anticipate a smooth transition to a more equitable system of determining whose needs are met and whose are not, at least in the US. I'm not even sure any such transition will occur at all.

I'm not sure the comparison to the press or developments from a century ago are quite analogous to the current conditions. I truly believe we are arriving at a fundamentally new event horizon that we have been approaching for several centuries.

[SR71]

Here's a Rolling Stone article addressed to millennials that seems to pertain to the present discussion. It's downright socialist in parts! Do any millennials read Rolling Stone?

Five Economic Reforms Millennials Should Be Fighting For | Politics News | Rolling Stone

4. Make Everything Owned by Everybody

Hoarders blow. Take, for instance, the infamous one percent, whose ownership of the capital stock of this country leads to such horrific inequality. "Capital stock" refers to two things here: the buildings and equipment that workers use to produce goods and services, and the stocks and bonds that represent ownership over the former. The top 10 percent's ownership of the means of production is represented by the fact that they control 80 percent of all financial assets.

This detachment means that there's a way easier way to collectivize wealth ownership than having to stage uprisings that seize the actual airplanes and warehouses and whatnot: Just buy up their stocks and bonds. When the government does that, it's called a sovereign wealth fund. Think of it like a big investment fund that buys up assets from the private sector and pays dividends to all permanent U.S. residents in the form of a universal basic income. Alaska actually already has a fund like this in place. If it's good enough for Levi Johnston, it's good enough for you.

[lisarea]

That piece spawned a pretty impressive troll from the Washington Post, too:

The depressing psychological theory that explains Washington

[Angakuk]

Originally Posted by SR71

I understand your point! In an increasingly automated world, workers become of less and less marginal utility, in the standard economic sense, and yet they continue to exist. If we accept that there is some level of general automation at which hiring workers becomes increasingly inefficient and costly in terms of producing goods and services when compared to the same output via automation, at some point we have a segment of the population that retains their needs but loses their capacity to earn wages and consume goods and services in the currently expected manner. What now becomes of them?

The decision is whether to leave them to their own devices and manage by hook or by crook, or possibly simply to fail to meet their own needs, or, provide for their needs in some way that does not involve them earning their own wages to pay for their own needs.

IOW, as much as the phrase makes me cringe, a paradigm shift. Who or what would assume responsibility to see that the needs of superfluous workers are met, especially as growing portions of population fall into the long term superfluous category?

The obvious solution is to cull the herd.

[SR71]

Long ass depressing article. SR's bold prediction - Governance will be forced to abandon fealty to the FIRE segment and rely instead on a pragmatic technocracy.

A Forecast of Our Energy Future; Why Common Solutions Don’t Work | Our Finite World

[SR71]

I think I had an original thought while driving today, but probably not. After all people having been thinking so much for so long they must have thought of everything by now.

So here is the thought. It's an analogy about comparing a car to a mixed economy. I think it probably stems from Obama's analogy about how the Republicans drove the economy into the ditch under Bush, and so Obama was left to get the carconomy out if the ditch. Probably just an expansion on that.

In very rough form, unbridled capitalism is the engine, government is the steering and socialist functions are the brakes. The braking part is the hardest to make into a coherent analogous description. It would involve social and public works programs to help during recessions, and regulation to help keep from getting into great recession type problems during periods of bubbleocity.

I don't know, maybe too unwieldy, but if one could make a convincing analogy, it might be a good PR tool to help people understand why some degree of socialism is a necessary component of a stable, mixed economy.

[JoeP]

And on another axis, libertarianism is no speed limits, pot holes, and road rage. I'm the only important person on the road and everyone should give way to ME!

Regulations are traffic lights, stop signs, lanes, speed limits and cops. Recognising that there are other people and that killing them is not the only option.