Are we ignoring Nobel Prize winners at our own peril?

[jld]

I read recently that Stiglitz and Krugman have warned that if governments do not continue stimulating their economies, we will be heading into a depression, and the long-term unemployed may become a permanent underclass. Anyone concerned about this?

[Rosie_0801]

I don't understand how everyone's economies can grow forever, and I think there might be a permanent underclass already. I don't know how big, but I've heard about third generation dole families. It's easy to tell them to get off their lazy butts and get a job, but the sort of mentality that must create would be really hard to work against. Unemployment trashes your self esteem so much that it's hard to try when you really do want a job even if you've only been out of work a month! I can't even imagine what it would do in three generations. How would you keep a positive attitude under such circumstances?

 

Rosie

[Guest Virginia Dawn]

I don't understand how everyone's economies can grow forever, and I think there might be a permanent underclass already.

 

:iagree:

 

My personal opinion is that everything the government could and may do to "stimulate the economy" will only make things worse in the long run. I think a deflation/depression is inevitable. Nothing can expand forever.

 

Our monetary system is credit based. That base is shrinking. The government has not been able to stop it. Maybe they have slowed it down, but it is only temporary. There are still very many insolvent banks and bad loans that have purposely not been allowed to go into default in order to create a sense that things are getting better.

 

The world is changing. Some people want to hide that, some want to slow it down, and some would prefer to get the pain over quickly. We'll have to wait and see what happens. I don't think the common person has much say in it.

[Alenee]

I read recently that Stiglitz and Krugman have warned that if governments do not continue stimulating their economies, we will be heading into a depression, and the long-term unemployed may become a permanent underclass. Anyone concerned about this?

 

In what ways do they suggest stimulation? Printing money? "Creating jobs"?

 

IMO, this is no place for government. As a new business owner I am more aware now than ever what government interference can do to the economy. We have a ton of laws we have to follow that are generally pointless...not all, but most. This inhibits our growth as a company which keeps us from being able to expand and hire more people. Not to mention the fact that we are seriously gouged on taxes. Cities/counties/states have needs for certain laws and taxes but not only do they go too far, the feds make it far worse.

 

I know this isn't a popular opinion to some here but it's my firsthand experience. We are not able to live off of what dh makes through his business because of some of the laws. If they were lifted, we could automatically grow. Until we can change our situation some, dh has to work a second job. If the Feds would stop trying to control every step we citizens take, our economy would be booming.

[Rosie_0801]

What sort of laws, Carli? And what are those laws for? I assume they don't exist just to make life difficult for people!

 

I really wish I could understand politics and economics more, but I just don't think my brain can absorb it. If I keep trying, maybe the lightbulb moment will happen one day.

 

:)

Rosie

[Lara in Colo]

As a business owner I can tell you that some of the laws and taxes make having a business so difficult that you can n ot grow, are afraid to hire people and realize that the govt really only want to support big business which is what is causing most of the economic problems right now.

 

Lara

[Guest Virginia Dawn]

I have an example from my brother. He works for a car manufacturer. He says the inventory tax law has had a great deal to do with manufacturing moving out of the US.

 

Inventory used to be stored in large warehouses here in the US. As I understand it, the law now says that any any inventory sitting for more than a certain (relatively short) period of time is taxed exhorbitantly by the government. Companies could not afford to pay these taxes so they began to warehouse their stuff in Mexico and other places. They also found it cheaper to keep the stuff moving in large tractor trailors. My brother knows of instances when a big rig would only have one box in it, just because that box of stuff had been sitting in one place for too long and if it was not moved the company could face a "tax" many hundreds of times the value of the stuff in the box. Now they were factoring the cost of the trucks, the gas and maintenance, and the man power that they had to put out all because they were not allowed to let anything sit in a warehouse.

 

The ironic thing is that law is one of the many things keeping manufacturing out of the US, but not many people realize that and they are blaming the companies themselves. This is just one example of how government can get involved in business, yet cause it harm.

[Rosie_0801]

Wow, that one doesn't seem to help anyone. It hurts businesses, the government doesn't even get the tax dollars because people have to avoid the problem, and it encourages carbon emissions which the government is supposed to be cutting.

 

You've got to wonder, don't you.

 

:confused:

Rosie

[NoPlaceLikeHome]

I read recently that Stiglitz and Krugman have warned that if governments do not continue stimulating their economies, we will be heading into a depression, and the long-term unemployed may become a permanent underclass. Anyone concerned about this?

 

I have to agree with them based on US history which shows that stimulation did help and lack of stimulation did hurt with the Great Depression from what I understand.

[NoPlaceLikeHome]

I have an example from my brother. He works for a car manufacturer. He says the inventory tax law has had a great deal to do with manufacturing moving out of the US.

 

Inventory used to be stored in large warehouses here in the US. As I understand it, the law now says that any any inventory sitting for more than a certain (relatively short) period of time is taxed exhorbitantly by the government. Companies could not afford to pay these taxes so they began to warehouse their stuff in Mexico and other places. They also found it cheaper to keep the stuff moving in large tractor trailors. My brother knows of instances when a big rig would only have one box in it, just because that box of stuff had been sitting in one place for too long and if it was not moved the company could face a "tax" many hundreds of times the value of the stuff in the box. Now they were factoring the cost of the trucks, the gas and maintenance, and the man power that they had to put out all because they were not allowed to let anything sit in a warehouse.

 

The ironic thing is that law is one of the many things keeping manufacturing out of the US, but not many people realize that and they are blaming the companies themselves. This is just one example of how government can get involved in business, yet cause it harm.

 

Do you have a source to support this so that I may try to learn more from it? I am always still learning, but IMHO I suspect that greed is more of a factor when it comes to outsourcing our jobs. Taxes are substantially lower now for businesses and for people compared to the 1960's and 1970's from what I have read in numerous articles. For example, the highest tax brackets used to have a 70% to 90% tax rate. I had a family member who used to be in that bracket and who did quite well and had a business and over 200 employees. His tax bracket did not prevent him from earning a lot of money or starting businesses or hiring people.

 

I think greed is more of a factor since today CEO's average about 400 to 700 times the average worker compared to the 1960's when they only made 42 times the average worker:001_huh:. Then there is the top layer of executives who also make enormous sums of money when compared to the 1960's and adjusted for inflation. How can the average American compete against people who make slave wages in China and elsewhere? The sad part is that I truly believe that more jobs could be kept here without increasing prices substantially if there was less greed at the top IMHO.

 

My 2 cents:)

Edited June 29, 2010 by priscilla

[Guest Virginia Dawn]

Do you have a source to support this so that I may try to learn more from it? I am always still learning, but IMHO I suspect that greed is more of a factor when it comes to outsourcing our jobs. Taxes are substantially lower now for businesses and for people compared to the 1960's and 1970's from what I have read in numerous articles. For example, the highest tax brackets used to have a 70% to 90% tax rate. I had a family member who used to be in that bracket and who did quite well and had a business and over 200 employees. His tax bracket did not prevent him from earning a lot of money or starting businesses or hiring people.

 

I think greed is more of a factor since today CEO's average about 400 to 700 times the average worker compared to the 1960's when they only made 42 times the average worker:001_huh:. Then there is the top layer of executives who also make enormous sums of money when compared to the 1960's and adjusted for inflation. How can the average American compete against people who make slave wages in China and elsewhere? The sad part is that I truly believe that more jobs could be kept here without increasing prices substantially if there was less greed at the top IMHO.

 

My 2 cents:)

 

This was heresay, but I tried to look into it. It seems that many states have phased out the inventory tax. The latest thing I could find was in 2009 and it said there were still 6 states with inventory taxes, Georgia and Mississippi were two. Since my brother is in South Carolina, I'm assuming it is there too.

It seems like this hurt smaller organizations and very large ones could somehow get exemptions. That was all I could glean from about 10 minutes of "googling." I think by now, many of those small companies have gone out of business or have been swallowed up by the larger ones. There, I would have to agree that greed is a major factor, but I think the greed cuts more than one way, considering how many politicians have big business in their pockets.

[Peela]

I have to agree with them based on US history which shows that stimulation did help and lack of stimulation did hurt with the Great Depression from what I understand.

 

I have just been studying the Great Depression in Australia (with my kids) and we were in great debt to Britain, because after WW1 we borrowed money to stimulate our own economies and build infrastructure, roads, a new capital city etc. It did stimulate the economy, but when the World Economic Collapse came, and no one wanted to buy our wool and wheat (which was how we made money to pay back the loans), we were stuffed. There was a lot of conflict in government because some leaders had radical proposals. A British economist came out and gave the Australian government advice- conservative advice to cut back public spending radically ( so as to repay the loans). What happened was inevitable- massive unemployment. Eventually they resumed public spending against British advice.

I think probably either way is simplistic. It is quite complex, it seems to me.

Here in Australia, they dig minerals out of the ground at a phenomenal rate and sell them off to the Chinese. That's why we arent feeling the impact very much. But to me...it is short sighted. One day teh minerals will run out and meanwhile, where in our society has that money been spent wisely for future generations?

 

I don't presume to know much at all. I just wish people in power would think long term, as in many future generation- rather than short term fixes. I suspect that "stimulating the economy" is a short term fix, but I dont really know. The whole foundation of our capitalistic system seems corrupted and anything we do is just rearranging deckchairs on the Titanic. People with deep integrity and deep vision need to be in charge, but our system doesnt allow for that to happen either.

 

I am not optimistic for our present way of life. I am optimistic that we can change and our children and their children may have better ideas than our outdated and short sighted leaders, though. I think change will be forced on us one way or another, and we had better be prepared for it.

[Guest Virginia Dawn]

I think it might be a good thing if materialism has reached its apex. I wonder what new "ism" will replace it though.

[Rosie_0801]

Here in Australia, they dig minerals out of the ground at a phenomenal rate and sell them off to the Chinese. That's why we arent feeling the impact very much. But to me...it is short sighted. One day teh minerals will run out and meanwhile, where in our society has that money been spent wisely for future generations?

 

 

I don't know why we aren't doing our best to lead the world in solar power innovations. We've got a large patch of continent with a heck of a lot of sun. Then we could be selling the knowledge and technology instead of raw minerals. I guess there is some reason we don't, but I don't know what it is.

 

Rosie

[joannqn]

IMO, this is no place for government. As a new business owner I am more aware now than ever what government interference can do to the economy. We have a ton of laws we have to follow that are generally pointless...not all, but most. This inhibits our growth as a company which keeps us from being able to expand and hire more people. Not to mention the fact that we are seriously gouged on taxes. Cities/counties/states have needs for certain laws and taxes but not only do they go too far, the feds make it far worse.

 

I know this isn't a popular opinion to some here but it's my firsthand experience. We are not able to live off of what dh makes through his business because of some of the laws. If they were lifted, we could automatically grow. Until we can change our situation some, dh has to work a second job. If the Feds would stop trying to control every step we citizens take, our economy would be booming.

 

:iagree: I think these laws affect small businesses the most; big businesses can find ways to work around it.

 

We are in the same boat with DH's business. He could be making more but laws affect the decisions he makes for his business. For example, he works in IT. Because of the way sales taxes are handled, he refuses to get into the hardware side of the business. Rather than buying the hardware his clients need and selling it at profit, he tells them what to buy. When they buy and receive it, he goes in and sets it up for them. The hassle of collecting sales tax for the state...figuring it out, collecting it, keeping records, paying it to the state, etc...isn't worth it for him at this point.

 

He was also telling me recently, that to follow the letter of the law he is suppose to obtain a business license in every city in which he physically does work. So, while he works out of our home in Tacoma, if he has a client who's office is in Federal Way, he's suppose to have a business license in both Tacoma and Federal Way. Now consider that he could easily have clients in a dozen cities because our cities are all close together and the business licenses run close to $100 a piece. That's a lot of money for a small, just starting business.

[Karenciavo]

I read recently that Stiglitz and Krugman have warned that if governments do not continue stimulating their economies, we will be heading into a depression, and the long-term unemployed may become a permanent underclass. Anyone concerned about this?

 

If by stimulate the economy they mean spending money we don't have, then yes, I'm concerned.

[creekland]

We need to let the economy "fall" to straighten itself out. The best analogy I heard was related to a family. If you give a family a million dollar credit card, of course the economy around them will improve. They will buy steak, hire a maid, take exotic vacations, buy a new car, etc, etc, etc. All those businesses will improve (esp if you then consider other families have their credit cards too).

 

BUT, the bill will come due. Suddenly the extra help will be fired, they'll be eating beans, that car will last for years and many people will be out of jobs.

 

BUT, if they get another credit card, life will be back till normal.

 

TILL that bill also comes due.

 

Many countries are running through credit cards under the guise of stimulating the economy. Yes, it works in the short run, but... when will the bill come due? When will the credit (investors - now mostly from China - stop)? IF they had bit the bullet and lived within their means in the first place life would have been far better.

 

To those that believe the Great Depression of the 30s was helped by FDR, the history channel had a great show on it... If I recall correctly, we are still paying for that debt. Morale was helped by FDR, but not numbers. WWII ended the depression (but not the debt). Many historians believe the US would have been better off keeping a hands off policy. We'll never know since we can't go back and try it, but at this point, we are several credit cards further down the line and I, for one, don't want to see ANY more taken out.

 

And yes, we have more than three generations that live off some form of welfare. My guess is it's been going on for ages (church groups prior to official welfare). I have kids in school where I work that openly tell me they plan to live off "paychecks" from unemployment to welfare. I'm all for cutting it off (for generational "followers"). Welfare reform definitely helped some, but not all. Their mentality is, "why work when others will work for you?"

 

This is one born and raised democrat that has since switched to financial conservative due to what I've seen in real life, both in school (where I work) and with hubby owning his own business.

 

Yes, gov't has to quit spending. Yes, it will hurt, but in the end, as a country, we will be better off for it - very similar to those on Dave Ramsey's course. It would have been better to have done it long ago, but we Americans like our perks and freebies too much.

[dragons in the flower bed]

What sort of laws, Carli? And what are those laws for? I assume they don't exist just to make life difficult for people!

 

Yeah, they do. Big business in bed with the government = lots of laws designed to be a PITA for new and little businesses. You could say they exist to make life easier for some people, I guess.

[creekland]

One law that has passed in PA now requires everyone in certain jobs to have a high school diploma or GED. I was talking with a lady yesterday who was telling me the waiting list to get into GED classes is 6 months to a year long (anyone can take the test, but not all are prepared to take it - hence, the classes).

 

For a specific case, a lady that has worked in a nursing home for 30 YEARS had to be laid off because she doesn't have her high school diploma. Her place of employment likes her so much they are holding her job for her, but tell me WHY any law had to be made that didn't grandfather in those with multiple years of experience??? Is she supposed to be better at her job after she can memorize details learned in high school? What about places that can't or won't hold jobs for people?

 

Granted, I found out about all of this via hearsay, but the hearsay came from people at school (where I work) and I've no reason to think it isn't truthful. They are the ones signing up people for GED classes.

[Lara in Colo]

Its not just laws against small business (which I own and am VERY aware of the negative ramifications of govt in my life) but look at laws passed for "public safety" There is a new law passed that says any house built before 1976 cannot replace their own windows (because of the possibility of lead) There has to be "special" company (expensive) to replace the windows. This is all houses before 1976--lead or no lead. This means that I will never be able to afford to replace my windows and the house is either cold or I spend a fortune to heat it (wasting energy) A friend of our says this has slowed the building industry even more. This seems counterproductive. Why not test the house for lead THEN make a decision? This takes power away from people.

There was this GREAT article from a lady in Austia about how they let the Natzi's in. They weren't taken over, they voted them in to help with the economy. Everything was great for a while, then the govt slowly took all their rights away until there was nothing left. She warns that she sees this happening here.

 

Lara

[creekland]

There is a new law passed that says any house built before 1976 cannot replace their own windows (because of the possibility of lead) There has to be "special" company (expensive) to replace the windows. This is all houses before 1976--lead or no lead. This means that I will never be able to afford to replace my windows and the house is either cold or I spend a fortune to heat it (wasting energy) A friend of our says this has slowed the building industry even more. This seems counterproductive. Why not test the house for lead THEN make a decision?

 

Lara

 

This isn't just windows. We know several people who do minor or major house renovations who have had to decide whether to take expensive classes and buy expensive equipment just to work on the pre '80 houses or not (since it doesn't really matter if lead is there). Most have decided they can no longer work on those houses. It's simply too expensive.

 

Of course, the larger companies can and have paid for their workers to take the classes... They are probably quite pleased at the lack of competition now - and they can charge more too.

 

I'm glad we had our windows done a couple of years ago. I'll need to find out if this crazy law applies to getting new carpets or not and our bathroom will be redone on the sly by ourselves (when we can afford it). I'm Libertarian and stupid rules don't necessarily have to be followed as far as I'm concerned. I have no ethical problem with it at all. Granted, I wouldn't do someone else's house like the folks that do it for a living, but if I want to fix problems in my house, we will. We just won't mention the age of the house to anyone or might have a slip of tongue if asked.

[Barry Goldwater]

I read the Krugman column...it's moot, since we're already out of money.

 

But for the sake of argument, I say he's 100 percent wrong.

 

Nobel prize does not equal practical brains. There's a ton of theoretical economists out there that could not run a lemonade stand for 45 minutes on July 4th in Miami Beach. Some of them got my tuition money:confused:

 

It's worth noting that wealth cannot be created by government. It is only created by the private sector when they mine, grow, or manufacture "something." The government can only spend what they tax from the productive classes, or what they will tax from our productive children (and now grandchildren).

 

Policemen, firemen, regulators are not productive classes...they are parasitic classes. We NEED them, they do critical work for our society, but they are not productive. I don't mean parasitic as a value statement, only that it requires a productive class to create wealth to be able to pay them.

 

Stimulus spending is an abysmal failure. More of it is a continuing waste of money. We need to cut taxes dramatically, generate real cuts in the size of government, and roll back needless or outdated regulation to liberate the productive classes that create sustained jobs.

 

There is also monetary policy, trade tariffs, and corruption, but that's another thread...and I don't want to get banned for getting too political :tongue_smilie:

 

Also, Krugman is a bit dishonest...we already ARE in a depression, at least here in the US. The govt. is gaming the statistics to avoid the distinction, but it's falling apart. The truth usually comes out to those that are paying attention.

 

That's all the cheery news I have for you today!

[jenL]

The world is changing. Some people want to hide that, some want to slow it down, and some would prefer to get the pain over quickly. We'll have to wait and see what happens. I don't think the common person has much say in it.

 

:iagree: and it frightens me, but I believe it has all spiraled so far out of control that there's nothing that can be done to stop its downward spiral. I think denial is our worst enemy right now, and I believe many governments, especially ours, are having extreme cases of denial. It's sad & scary at the same time.

[ahousefullofjs]

We need to let the economy "fall" to straighten itself out. The best analogy I heard was related to a family. If you give a family a million dollar credit card, of course the economy around them will improve. They will buy steak, hire a maid, take exotic vacations, buy a new car, etc, etc, etc. All those businesses will improve (esp if you then consider other families have their credit cards too).

 

BUT, the bill will come due. Suddenly the extra help will be fired, they'll be eating beans, that car will last for years and many people will be out of jobs.

 

BUT, if they get another credit card, life will be back till normal.

 

TILL that bill also comes due.

 

Many countries are running through credit cards under the guise of stimulating the economy. Yes, it works in the short run, but... when will the bill come due? When will the credit (investors - now mostly from China - stop)? IF they had bit the bullet and lived within their means in the first place life would have been far better.

 

To those that believe the Great Depression of the 30s was helped by FDR, the history channel had a great show on it... If I recall correctly, we are still paying for that debt. Morale was helped by FDR, but not numbers. WWII ended the depression (but not the debt). Many historians believe the US would have been better off keeping a hands off policy. We'll never know since we can't go back and try it, but at this point, we are several credit cards further down the line and I, for one, don't want to see ANY more taken out.

 

And yes, we have more than three generations that live off some form of welfare. My guess is it's been going on for ages (church groups prior to official welfare). I have kids in school where I work that openly tell me they plan to live off "paychecks" from unemployment to welfare. I'm all for cutting it off (for generational "followers"). Welfare reform definitely helped some, but not all. Their mentality is, "why work when others will work for you?"

 

This is one born and raised democrat that has since switched to financial conservative due to what I've seen in real life, both in school (where I work) and with hubby owning his own business.

 

Yes, gov't has to quit spending. Yes, it will hurt, but in the end, as a country, we will be better off for it - very similar to those on Dave Ramsey's course. It would have been better to have done it long ago, but we Americans like our perks and freebies too much.

 

:iagree:Very well put. I agree completely.

[lovemyboys]

In what ways do they suggest stimulation? Printing money? "Creating jobs"?

 

IMO, this is no place for government. As a new business owner I am more aware now than ever what government interference can do to the economy. We have a ton of laws we have to follow that are generally pointless...not all, but most. This inhibits our growth as a company which keeps us from being able to expand and hire more people. Not to mention the fact that we are seriously gouged on taxes. Cities/counties/states have needs for certain laws and taxes but not only do they go too far, the feds make it far worse.

 

I know this isn't a popular opinion to some here but it's my firsthand experience. We are not able to live off of what dh makes through his business because of some of the laws. If they were lifted, we could automatically grow. Until we can change our situation some, dh has to work a second job. If the Feds would stop trying to control every step we citizens take, our economy would be booming.

 

Thanks for this key perspective....how the economy and regulations really do effect businesses that could and would be hiring more.

 

 

In general -- I too would be reluctant to follow much of Krugman's ideas -- he supports additional (borrowed) stimulus and seems to be against deficit reduction proposals. Among other things in recent years, he sees a couple of peripheral people as the being singly responsible for the sub-prime mortgage crisis which helped to deepen the current economic recession. He completely ignores many of the key players who are Democrats. That's just intellectually dishonest. I think I'd want to read what they wrote or said rather than relying on the NP label.

[lovemyboys]

Do you have a source to support this so that I may try to learn more from it? I am always still learning, but IMHO I suspect that greed is more of a factor when it comes to outsourcing our jobs. Taxes are substantially lower now for businesses and for people compared to the 1960's and 1970's from what I have read in numerous articles. For example, the highest tax brackets used to have a 70% to 90% tax rate. I had a family member who used to be in that bracket and who did quite well and had a business and over 200 employees. His tax bracket did not prevent him from earning a lot of money or starting businesses or hiring people.

 

I think greed is more of a factor since today CEO's average about 400 to 700 times the average worker compared to the 1960's when they only made 42 times the average worker:001_huh:. Then there is the top layer of executives who also make enormous sums of money when compared to the 1960's and adjusted for inflation. How can the average American compete against people who make slave wages in China and elsewhere? The sad part is that I truly believe that more jobs could be kept here without increasing prices substantially if there was less greed at the top IMHO.

 

My 2 cents:)

 

 

This may be true for a small percentage of the biggest companies just as it's true that a small percentage of actors make huge salaries (although many of the professional athletes make great salaries).

 

But most companies are smaller and the owners and managers don't make huge salaries. They also work extremely long hours, especially in the early years getting the business off the ground. Another way to look at it is the risk involved too.

 

Like the current financial regulations for banking -- the new laws that are being proposed supposedly result from recent abuses by the large institutions. But in fact, these regulations will harm small, local banks by adding fees and regulations and eliminate loans for small businesses, farms, etc. This will impact all of us. And it's really unnecessary.

[mcconnellboys]

Ummmm, continued "stimulation" of the economy through continuing to print more money? Continuing to increase our debt load to China? Continuing to send jobs offshore? Continuing to rob one account (i.e., Social Security, Medicare, Medicaid) to pay for something else? Continuing to increase things such as "earned income credit", whereby those who don't even pay into the system get rebates from it?

 

I think the G20 demonstrates well enough that countries further along down this road are beginning to rethink spending without end.....

 

I'm afraid that I will have to agree with the likes of Ayn Rand on this one. And this is something I've been saying for several years now, since well before the current administration was in place, so please don't think I'm jumping on the bandwagon of those who are just now beginning to tout such ideas.

 

Everything, everything that we have in the world has to be produced by someone. We cannot survive as a society of takers/users/consumers when we have no one on the producing end of the spectrum. We cannot continue to give and give and give to those with their hands out.

 

Where are we going to get the things we give? Who is going to produce those things? Communism hasn't worked out in the world all that well for a reason. When individuals have no incentive to give and give and give -when all the work you put out for a lifetime gets you nothing more than the next person who does nothing, after a while the prudent person stops producing. When there are no producers left, then what? Enslavement? Forced labor? It's happened before.....

 

You didn't provide a link of what they're suggesting this "stimulation" should be. I would love to see us stimulate our economy by declaring austerity measures, pulling back our industry to our own shores and putting people back to work here. I would love to see us stop giving handouts to those who don't pull their own weight and haven't for generations. I would love to see us become more self-sufficient as a country, rather than a vassal state of China. I don't think that's going to happen, but I would love to see it.

[mcconnellboys]

I have worked with people who have never known anything other than living on the government dole. When they are educated about the possibilities for them to have a different sort of life, many of them are eager to break out of the vicious cycle they are in. However, if no one ever gives them that vision of another way, most just don't have any idea that they CAN do anything else.

 

That's one reason that some of us who were on the boards after Katrina, and who had lived and/or worked in the areas in and around New Orleans, said that it was really better if the projects there were not rebuilt and those who had vacated them were not encouraged to come back to that.

 

Getting out of that cycle gave those people a new vision of a life they could have that they had never imagined before. I haven't checked lately, but I don't think that most of those folks came back to that.

 

Now, that's not to say that any large majority of them did break out of that cycle of life. I don't know that any studies have been done on this. But I still feel that it did give many of them a chance at something they had never imagined.

 

I know that other cities where large numbers of those folks migrated (like Houston) did have some increased crime for a time, but I haven't heard that this has continued over time.

[mcconnellboys]

With the latest jobs report that came out, it seems that most of the jobs "created" were government census jobs which were/are temporary. And the typical monkey business of laying folks off and then rehiring them, to increase counts, is going on, too. Numbers are no longer to be believed. Reports are tinkered with to make them say what those in power want them to say.....

 

The way that unemployment is calculated has been changed so much since the time of Clinton (by both parties) that it in no way resembles the actual unemployment rate in this country....

[mcconnellboys]

Well, we know that corn is stockpiled so high that it sits and rots on the side of the tracks in Iowa, etc. So I guess that when we face a crisis in this country and are all starving because we have no stockpiles of foodstuffs or goods we need anywhere in the country, we can at least all trek to Iowa and eat corn, LOL......

[mcconnellboys]

They exist to insure that manufacturing stays offshore and we continue to buy almost everything from China.

 

We've been looking at purchasing new furniture and all we can find in the stores here is "made in China" mystery wood, covered in veneer. Seriously, many of the brands don't even say what type of wood is used..... Even when the salespeople try to look it up, it's not listed anywhere. And we're told (by those who deal in real wood products) that this is all they have to choose from when they go to market to buy furniture for their stores.

 

We just trekked 12 hours across southern Indiana last week to find Amish woodcrafters.... Yes, real wood furniture is still available in America. You just have to look for it. And you have to look for everything else made in America, too, if you really want to break out of the cycle of being a vassal of China....

[mcconnellboys]

But..... we're in a whole 'nother world than we were in at that time period in history. Nothing is the same. I don't think we can compare this to that at all.....

[Margaret in GA]

:iagree:

As a business owner I can tell you that some of the laws and taxes make having a business so difficult that you can n ot grow, are afraid to hire people and realize that the govt really only want to support big business which is what is causing most of the economic problems right now.

 

Lara

 

 

We are business owners here, too. The deck is stacked against any business in this country without a strong lobby or the money it takes to buy favor. In Georgia we do have an inventory tax (depends on your county) and it's just plain foolish. They have so many sneaky little fees (and please, do not get me started on "gotcha" penalties for paperwork not properly filed), we end up getting 'taxed' over and over.

 

I read that Krugman article with a sigh of relief because finally some "important" people are admitting the truth. We are stuck in a very long recession that is likely to be labeled a depression by the end. I don't think more government spending (at least the way we are doing it now) is the way to go. I do think we need to get out of these wars that are killing our deficit. Not to mention our soldiers.

 

Just read Deep Economy by Bill McKibben. I am entirely convinced that in order to survive and come back strong, we have got to get back to our local economies: local food, local manufacturing, local communities. Because you think it's bad now? Wait until oil is over $100 again. How about $200? It will happen again in the next decade, you can bet on it. We never do the hard things in this country until we are forced to do it. :(

[lovemyboys]

We need to let the economy "fall" to straighten itself out. The best analogy I heard was related to a family. If you give a family a million dollar credit card, of course the economy around them will improve. They will buy steak, hire a maid, take exotic vacations, buy a new car, etc, etc, etc. All those businesses will improve (esp if you then consider other families have their credit cards too).

 

BUT, the bill will come due. Suddenly the extra help will be fired, they'll be eating beans, that car will last for years and many people will be out of jobs.

 

BUT, if they get another credit card, life will be back till normal.

 

TILL that bill also comes due.

 

Many countries are running through credit cards under the guise of stimulating the economy. Yes, it works in the short run, but... when will the bill come due? When will the credit (investors - now mostly from China - stop)? IF they had bit the bullet and lived within their means in the first place life would have been far better.

 

To those that believe the Great Depression of the 30s was helped by FDR, the history channel had a great show on it... If I recall correctly, we are still paying for that debt. Morale was helped by FDR, but not numbers. WWII ended the depression (but not the debt). Many historians believe the US would have been better off keeping a hands off policy. We'll never know since we can't go back and try it, but at this point, we are several credit cards further down the line and I, for one, don't want to see ANY more taken out.

 

And yes, we have more than three generations that live off some form of welfare. My guess is it's been going on for ages (church groups prior to official welfare). I have kids in school where I work that openly tell me they plan to live off "paychecks" from unemployment to welfare. I'm all for cutting it off (for generational "followers"). Welfare reform definitely helped some, but not all. Their mentality is, "why work when others will work for you?"

 

This is one born and raised democrat that has since switched to financial conservative due to what I've seen in real life, both in school (where I work) and with hubby owning his own business.

 

Yes, gov't has to quit spending. Yes, it will hurt, but in the end, as a country, we will be better off for it - very similar to those on Dave Ramsey's course. It would have been better to have done it long ago, but we Americans like our perks and freebies too much.

 

GREAT post! Thanks.

[lilbean05]

They exist to insure that manufacturing stays offshore and we continue to buy almost everything from China.

 

We've been looking at purchasing new furniture and all we can find in the stores here is "made in China" mystery wood, covered in veneer. Seriously, many of the brands don't even say what type of wood is used..... Even when the salespeople try to look it up, it's not listed anywhere. And we're told (by those who deal in real wood products) that this is all they have to choose from when they go to market to buy furniture for their stores.

 

We just trekked 12 hours across southern Indiana last week to find Amish woodcrafters.... Yes, real wood furniture is still available in America. You just have to look for it. And you have to look for everything else made in America, too, if you really want to break out of the cycle of being a vassal of China....

 

This totally reminds me of the other day in our home. We got to talking about ethnicity with my daughter, specifically Mulan's. We told her that Mulan was Chinese and was from China. Her face lite up as though she had solved all of life's mysteries. She said "ALL of my princesses are from China!" and she ran over to her small plastic Disney princess set, flipped them upside and said "See, it says China on the bottom! They are ALL from China!"

[Pippen]

This totally reminds me of the other day in our home. We got to talking about ethnicity with my daughter, specifically Mulan's. We told her that Mulan was Chinese and was from China. Her face lite up as though she had solved all of life's mysteries. She said "ALL of my princesses are from China!" and she ran over to her small plastic Disney princess set, flipped them upside and said "See, it says China on the bottom! They are ALL from China!"

 

Out of the mouths of babes!

Some years ago we had a friend who was studying in China and we searched for small, inexpensive gifts from our region to send for him to leave with friends there. We had a hard time finding stuff that wasn't from China.

 

Here's an interesting take on Krugman's article:

http://www.realclearmarkets.com/articles/2010/06/29/paul_krugmans_depression_98545.html