Apparently, the poverty level is increasing, and the trend started well before the recession. My take on this is that it's bad for business when people don't spend money and reinvest in the system. Just as an example, Ford paid his employees enough to buy his cars because it was GOOD FOR BUSINESSES. Currently, a lot of companies are cutting staff just to stay afloat, and it may get worse, so it may not even be possible to hold to that idea. While I've been accused of being everything from liberal communist to libertarian asshole, I'm more interested in simply seeing the country do as well as it can.....and lately, we're really not.
We all know the standard GOP v DEM arguments, but what actual structural changes would fix this. What will reverse the trend? Is this just a cyclical thing?
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....to be taken with a grain of salt.My perception is that in addition to severe mismanagement compliments of the Washington crowd, we're still adjusting to maintaining a middle class in the face of competition from labor pools that existed at a subsistence level only a generation ago. As they catch up to our standards of living, the jobs will start to come back......does anyone want to build on / add to this?
I think the world has a sustainable carrying capacity of maybe 4-5 Billion people, so that has been exceeded.
The good news is that the US is the largest exporter of staple grains in the world. What we can do at the federal level is slap a $1-2/bushel export tax on wheat. 95% of that is going to get passed on to the foreign consumer, and that's going to raise the floor on labor costs abroad and help speed the process of US workers recovering.
Devote the proceeds of the export tax to providing better educations in rural parts of the country and maybe a little research on nuclear fusion at land-grant state schools and you have a balanced plan to help the US leverage its resources better.
If China or India (food importers) don't like the policy of charging more for food, they can stop selling us cheap trinkets and thereby balance the trade deficit. Or try to invade, but geography and 250 years of history demonstrate that that's going to be very difficult whether they're going up against the world's most powerful military or a bunch of civilians with rifles.
So the rest of the world can go starve as long as middle-America can keep buying its SUVs, smartphones and keep having very low fuel prices? Pretty inward looking view, especially as those Indians and Chinese will be your children's employers!
No country can exists with NOBODY being poor. There has to be relative poverty or else you're basically advocating communism. Face it, even the poor in America are still pretty well off compared to a lot of the world. They should work harder / re-educate themselves or go live in REAL poverty, then complain about only being able to afford 3 Big Macs a week or filling up the gas-guzzler being too expensive.
I haven't really thought of the idea of setting up export taxes, but I like the general idea. Instead, I've thought about it the other way, where the trinkets and such get tariffed to be brought into the US. It would make the the imports more expensive for the US consumers if the costs end up being passed to us, but this could possibly be balanced out by aggressive tax incentives for manufacturing here in the US so we could instead be making more here. I understand there would be a huge lag before demand actually increases enough for manufacturing to pick up.
We have an underutilized manufacturing base and it's killing us right now.
The "our workers aren't qualified to make stuff" comment mentioned above is just a sorry excuse. With the right environment to make money, people will get qualified. The other argument I've seen is that our population is just "too old." That idea too should be thrown out, and if it is in fact valid (haven't studied it at all), a controlled and sensible immigration policy could help. There are plenty from south of the border that would love to do the work we won't do and they could do it legally and contribute to the tax base, etc.
Step 1: Tariff imports quite heavily. Global pain will ensue as we are unable to buy as many goods, and growth rates in emerging markets that are making all of our stuff will be thrown off considerably.
Step 2: Make defined long term commitments to reduce taxes on manufacturing companies of all sizes. The tax breaks should include anything and everything we can use ourselves or ship elsewhere. As prices of imports go up for the American consumer due to Step 1, it will drive up demand from our own goods here stateside.
Step 3: Let the exporting flow tax free so our goods are as cheap as possible for everyone else to buy. The dollar is still pretty strong compared to most currencies so pricing ourselves out when people are starving elsewhere and we still have underutilized capacity and a high unemployment rate doesn't seem smart but I could be wrong.
Final Result: Give it a decade or two and our export\import balance might look more pretty and hopefully we can get a handle on unemployment and the deficit in the process by PRODUCING for the rest of the world, anchoring with the basics like food. I understand this is very simplified and doesn't take into account many factors, especially the big one- the trend towards global interdependence that probably has little chance of reversing.
Feel free to tear that idea apart, it's just a discussion point.
Wow IP, you always take these convuluted ways to success instead of the highway. We could creat millions of jobs, especially for youth if we ended the minimum wage. The problem is less visible in major cities like NYC and the suburbs, but is very obvious when you go to cities like Newark, Buffalo and CIncinatti. If we get kids working 15-20 hours a week when they are in high school, we could easily kill a lot of the listlessness and crime that happens.
Also, ending the drug war and getting rid of a lot of the silly regulations would help.
This is economics 101. Reducing regulations might reduce unemployment but it won't increase wages. To do that, we need to reduce China's ability to subsidize its supply of cheap labor.
This is the real issue.
The Earth can't sustain economic growth forever, that is part of the reason why I do not believe people like Buffet when they say things like "our grandchildren will live better then we do, and then their children will live better then they did, etc... At some point in the future that is not going to be true
>So the rest of the world can go starve as long as middle-America can keep buying its SUVs, smartphones and keep having very low fuel prices?
Yup. OPEC did it to us in the '70s and China is being mercantilist today. It's time for the US to start looking out for #1 again rather than for other countries. Our parents told us that there were starving kids in China because they didn't want us to go hungry- not because they wanted to wrap up our food, send it to China, and let their kids starve.
>Pretty inward looking view, especially as those Indians and Chinese will be your children's employers!
Actually, my children will be well-fed and there will probably be fewer Indians and Chinese in 30 years than there are today- and we'll be feeding all of them. It's not the US's problem that China and India were irresponsible and exceeded their population carrying capacities. This is something China and India have primary responsibility to figure out since it is a problem largely of their own making that largely affects them.
>No country can exists with NOBODY being poor. There has to be relative poverty or else you're basically advocating communism.
Sure, but the US controls most of the world's food exports, so we can take steps to help minimize poverty in our country. We were a rich country in the '50s and '60s, and we can be rich again.
> Face it, even the poor in America are still pretty well off compared to a lot of the world. They should work harder / re-educate themselves or go live in REAL poverty, then complain about only being able to afford 3 Big Macs a week or filling up the gas-guzzler being too expensive.
In a country with abundant natural resources and relatively low population, they shouldn't have to. If the US reduces grain exports, we can get back in the business of manufacturing and paying folks comfortable wages.
LOL, my folksy demeanor and worldview is annoying to some people? That is so disheartening. Oh well, back to more cow-tipping.
The best way to increase prices is to put more obstacles in the way of supply. This goes for everything from oil to labor. Want manufacturing jobs to start paying more? Leverage our agricultural productivity to make it harder for China to hold wages down.
But what sane politician would finger-point at the populace?
I've given tariffs a lot of thought, but China has managed to completely rig GAAT and the WTO such that they can offer huge subsidies and then cry foul when we impose a tariff and get into a trade war. The resources issue gets around all of that. Outside of oil- and we have a lot of allies like Saudi Arabia, Iraq, Canada, and now Libya in that area- the US is largely self-sufficient in terms of resources.
Basically we need to hit mercantilist China in a way that it can't come up with an effective response on: export taxes on food. China can retaliate with their own export taxes on trinkets- doing our job for us- if they want, or they can eat the cost (pardon the pun). Either way, the cost of manufacturing in China goes up while staying low in the US.
I don't think the US can get away with production mercantilism, but given that we control 30% of the world's agricultural productivity and 25% of the world's coal and natural gas, we can get away with RESOURCE mercantilism. Don't like paying a 25% export tax on food? FINE. Good luck growing corn in the Gobi Desert. Ruhroh, the price of our corn exports just jumped another 10% over this huge argument.
In the mercantilist endgame, national per-capita wealth approaches (resources)/(population). In Continental Europe, this would generally end in a war, but England has never been invaded and the US has greater military and geographical advantages than the UK.
I'm not opposed to a tax increase on exported food. China is all about low wages = cheap goods = high exports. If we can force/coerce them into floating the yuan or increasing wages I'm all for it. I do think that removing some things like the minimum wage, subsidies, drug wars, lots of regulations are good.
The tariff thing though, IMHO is retarded. There is an easy way to counter that and we don't export enough to be able to handle a tariff on our goods. We would probably be fine in food, medical devices, and weapons, but other places would suffer. (since a tariff could be exclusive to other goods
I think IP is spot on with his analysis. As for manufacturing never coming back to the US, that is absolutely false. China is cheaper than the US, but that is slowly eroding with their higher wages and higher shipping prices. China really didn't take US jobs, it took Mexican jobs lol. With Mexico being a shithole and slowly becoming a Somalia Jr. I think you will see manufacturing come back to the states and set up shop down south.
What killed US manufacturing was many things, but in part the unionized north. If you want to jerk off in high school and be lazy, cool, but don't expect the union to milk 30 bucks an hour from a factory and have them stay in the US. Now that we have realized the damage over zealous unions can do I think you will see manufacturing slowly dribble back.
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