FIRE Economy Explosion Fallout -- Part I: Recession ends, depression begins - Eric Janszen

[radon]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins

you still have not explained how, given the unchanging disparity of abilities among the population over generations, nonetheless the income distribution changes over time. more specifically, you have not addressed the fact that recently incomes have become more unequal than at any time since 1929, yet the distribution of abilities - however defined- over the population is no more extremely dispersed. what's changed?

Technology drives this in part. Many jobs in have disappeared because of labor saving devices. The bulk of the jobs that no longer exist did not require any sort of intelligence, ambition, or creativity. These low paying jobs have been marginalized disproportionally because they are the easiest to automate.

As an example I remember an interesting project a few years ago involving warehouse automation. Nobody seemed to concerned with the fate of the forklift drivers.

[dcarrigg]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins

I further feel that any forced wealth redistribution would only be a temporary unnatural state. As such, and with all due respect to EJ, I can't agree with his call for doing a better job of wealth equalization during boom times simply because that wealth will (eventually) find its way right back into the hands of the same wealthier (more capable) people from whence it came.

In summation, it is my opinion that uneven wealth distribution is a natural state that results from a free-market society, and that a free-market society is still the best structure/philosophy for maximizing the size of the pie (strength of an economy), even if it means some inequalities OF RESULT (of wealth) are a natural side affect. The greater pie size will offset the smaller portion of said pie for most citizens in my opinion.

Respectfully, I think that you may be missing a big issue in labeling wealth redistribution an "unnatural state." Every society in the history of humanity, bar none, has redistributed wealth. Always. No matter the economic system. It simply must be done.

The older paternalistic-feudal model let the "more capable" (by birthright) be saddled with the responsibility for overseeing the "less capable" (by birthright).

The advent of the bourgeois revolution allowed the third estate to cancel much of the birthright legacy (although not through forms of inheritance and real estate holdings) and allowed for the competitive model of which you now speak.

Of course, this was before standard wage employment. Since the rise of political equality over the last century has occurred concurrently with the rise of standard wage employment, two interesting results have occurred.

1) Wealth redistribution happens de facto through an owner dictating wage to employees based on how much profit an owner wishes to keep in reserve or for personal purposes (owner can be extrapolated to shareholder).

2) Growing income inequality becomes a political issue due to political equality - through labor movements, unionization, and pressure on elected leaders (Since all of the money in the world - while it may buy lobbyists - still only gets you one vote).

So I think that your characterization of wealth redistribution as an "unnatural state" is incorrect considering the realities of living in a modern liberal democracy.

Further, I find that growing wealth inequality can actually result in shrinking the pie you speak of by causing political instability and thereby threatening property rights.

There is no use owning a mansion or jewelry store when you can't keep it safe - no matter how much more productive you are.

[bart]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

There will always be a fraction of the population that is willing to risk breaking the law for money no matter what the punishment. Many laws currently on the books are simply being selectively enforced. Creating new laws or changing penalties doesn't address this problem.

That's not the problem that I was attempting to address.

What I'm referring to is a quite broad issue. Selective enforcement is a portion of the whole area that also should have much higher penalties.

[jk]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins

Technology drives this in part. Many jobs in have disappeared because of labor saving devices. The bulk of the jobs that no longer exist did not require any sort of intelligence, ambition, or creativity. These low paying jobs have been marginalized disproportionally because they are the easiest to automate.

As an example I remember an interesting project a few years ago involving warehouse automation. Nobody seemed to concerned with the fate of the forklift drivers.

i think technology and, as i said earlier, financialization and the global labor arbitrage are all implicated. but financialization, in particular, has been a political and cultural choice, not just an economic one. look at ej's lists of the 100's of bankers who got million dollar bonuses in spite of making bad decisions. and the mortgage brokers and real estate hustlers and condo flippers who made bundles. my point is that there's more to income disparities than "ability."

[Raz]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

there will be no universal justice and peace (i..e, no utopia), at least not until the "lion lays down with the lamb". There may be periods of great prosperity and peace, but those never last; corrupt human nature cannot be trusted and it cannot be kept down without continual supervision and exercising the wisdom that has been handed down to us from our forebearers. But modernism has chucked that wisdom down into the sewer

history is before us; how much more do we need to see that generation after generation, century after century, millenium after millenium, the same sad and sorry "soap operas" are re-played by man. Murder, treachery, deceit and manipulation ... oppression.

Human nature is with us till the end, my friends. The modern man is no different or superior at his core than the ancient man The fallacy is believing that we are "progressing" toward an inevitable "good end".
Look at the facts of history for goodness sake. Technical advances, and raised standards of living, long life spans, etc. are all good, but they have yet to change who we are at the core (and some might argue, they have served as excuses to cut the ties with the past and reason itself).

Have you been reading my thoughts?

About three days ago I began thinking about the appalling ignorance of the "enlightened" class in the United States. The "white wine, Volvo and cheese" set (I know a lot of these people) who aren't even aware of Ptolemy's Amalgest - the astonomical handbook used in the Middle Ages. He stated that in relation to the nearest star outside our own solar system, the earth is so small as to be only a mathematical point.

Yes the ancients were all a bunch of ignoramuses and we are so "enlightened". :rolleyes:

[bart]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

The Apology is enlightening too, although long.


http://classics.mit.edu/Plato/apology.html

[*T*]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

That's not the problem that I was attempting to address.

What I'm referring to is a quite broad issue. Selective enforcement is a portion of the whole area that also should have much higher penalties.

I don't believe higher penalties in general act as a strong deterrent. I think that the likelihood of getting caught is the determining factor.

[bart]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

I don't believe higher penalties in general act as a strong deterrent. I think that the likelihood of getting caught is the determining factor.

One of many ways to deal with that is having penalties shared by those who knew but did not speak up or do anything. Also note that I modified higher penalties with reliable and consistent.

And before anyone posts the obvious, what I'm talking about is currently quite unrealistic and "blue sky"... but also its not an absolute in all of human history or the social sciences.

[flintlock]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

To my mind, this is the most profound statement of fact that I have ever seen anywhere.

I do not know who you are, but to my way of thinking, you should come out of the shadows and stand up proudly, as one of the great thinkers of our time.

I remember my teacher making us watch this documentary back in the 70s when I was a grade school kid. Kind of lame by today's standards, but even then people saw that life was getting ever more complex at an exponentially increasing rate.

http://en.wikipedia.org/wiki/Future_Shock

[Slimprofits]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

This morning on ABC's This Week, George Stephanopolous asked Geithner about extending benefits for up to 1.5 million people that will see them expire at the end of 2009:

http://blogs.abcnews.com/george/2009...-benefits.html

The New York Times reported this morning that up to 1.5 million people could lose their benefits by year’s end. When I pressed Geithner for a response, he promised the administration would “do enough to bring this economy back” and pledged to take up the issue “as we get closer to the end of this year.”

***

There is not a political chance that the Democrats don't extend the benefits, even if no Republicans go along with it.

[Quincy K]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

This morning on ABC's This Week, George Stephanopolous asked Geithner about extending benefits for up to 1.5 million people that will see them expire at the end of 2009:

http://blogs.abcnews.com/george/2009...-benefits.html

The New York Times reported this morning that up to 1.5 million people could lose their benefits by year’s end. When I pressed Geithner for a response, he promised the administration would “do enough to bring this economy back” and pledged to take up the issue “as we get closer to the end of this year.”

***

There is not a political chance that the Democrats don't extend the benefits, even if no Republicans go along with it.

Why wouldn't they extend the benefits? After all, it's only paper and deficits don't matter.

[metalman]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

ft agrees...

US GDP

Published: July 31 2009 14:56 | Last updated: July 31 2009 19:01

Spot the supposed improvement: 0, -1.9, -3.3, -3.9. That is the progression of year-on-year percentage growth rates for the US economy over the past four quarters. Yes, but the decline is slowing, reply optimists. The sequential fall in output was only 1 per cent, according to Friday’s second-quarter data, compared with -6.4 per cent before.

But of course things feel better. The economy is on massive doses of stimulus spending and cheap money. Government consumption surged 6 per cent quarter on quarter, which took some of the sting out of the overall contraction. Low interest rates cooled the meltdown in business and residential investment. Washington has also helped in other ways. Real incomes rose slightly, thanks to increased benefit payments and lower tax receipts.

[GRG55]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

This morning on ABC's This Week, George Stephanopolous asked Geithner about extending benefits for up to 1.5 million people that will see them expire at the end of 2009:

http://blogs.abcnews.com/george/2009...-benefits.html

The New York Times reported this morning that up to 1.5 million people could lose their benefits by year’s end. When I pressed Geithner for a response, he promised the administration would “do enough to bring this economy back” and pledged to take up the issue “as we get closer to the end of this year.”

***

There is not a political chance that the Democrats don't extend the benefits, even if no Republicans go along with it.

Here's a link to the NYT article referenced with a little graphic included.

If the present trends continue by the time this is over people will be less concerned about affording laptops, movies, and summer camp fees...unfortunately.

Prolonged Aid to Unemployed Is Running Out
By ERIK ECKHOLM
Published: August 1, 2009

Over the coming months, as many as 1.5 million jobless Americans will exhaust their unemployment insurance benefits, ending what for some has been a last bulwark against foreclosures and destitution...

...Unemployment insurance is now a lifeline for nine million Americans, with payments averaging just over $300 per week...

...Calls are rising for Congress to pass yet another extension this fall, possibly adding 13 more weeks of coverage in states with especially high unemployment. As of June, the national unemployment rate was 9.5 percent, reaching 15.2 percent in Michigan. Even if the recession begins to ease, economists say, jobs will remain scarce for some time to come.

“If more help is not on the way, by September a huge wave of workers will start running out of their critical extended benefits, and many will have nothing left to get by on even as work keeps getting harder to find...

[Ann]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

Here's a link to the NYT article referenced with a little graphic included.

If the present trends continue by the time this is over people will be less concerned about affording laptops, movies, and summer camp fees...unfortunately.

Prolonged Aid to Unemployed Is Running Out
By ERIK ECKHOLM
Published: August 1, 2009

Over the coming months, as many as 1.5 million jobless Americans will exhaust their unemployment insurance benefits, ending what for some has been a last bulwark against foreclosures and destitution...

...Unemployment insurance is now a lifeline for nine million Americans, with payments averaging just over $300 per week...

...Calls are rising for Congress to pass yet another extension this fall, possibly adding 13 more weeks of coverage in states with especially high unemployment. As of June, the national unemployment rate was 9.5 percent, reaching 15.2 percent in Michigan. Even if the recession begins to ease, economists say, jobs will remain scarce for some time to come.

“If more help is not on the way, by September a huge wave of workers will start running out of their critical extended benefits, and many will have nothing left to get by on even as work keeps getting harder to find...

The American unemployed shall never again suffer as in the 1930s.

Unemployment insurance shall always be paid.

Today we have: the printing press.

[cjppjc]

Re: FIRE Economy Fallout -- Part I: Recession ends, depression begins - Eric Janszen

Anyone here who is unemployed from a well paying job, like to educate us on how much unemployment insurance they receive?