The General Economics Thread

10 basic premises of why our current form of capitalism is a problem and how Pope Francis would like to fix it.

In some ways this is a very boiled down list, but I think most of the basic premises of why our current form of capitalism is unsustainable and by default immoral, are at least on the right track.

Austrian: "But but but, the free market will fix everything! It works so great in Kansas!"

I saw a mises.org article by a Catholic saying that the pope was dead wrong about his beliefs regarding capitalism. But that was back when I was still following my brother's wishes to read mises.org and learn about the joys of Austrian economics. Yeah, I came to disagree with that silly site the more I read it.

Hasbro to possibly buy out DreamWorks Animation.

Could be a good way to get a proper FIM motion picture made, none of this Equestria Girls malarkey.

On British Supermarkets:

I've noted some parts in bold.

• Sainsbury's mothballs shop plans and reports fall in sales

And today, Asda sees sales fall as 'shockwave' hits supermarkets

Houston-based energy companies Halliburton and Baker-Hughes considering merger.

Millenials are spending roughly the same amount of money their parents did at the same age, despite accusations Millenials are more incompetent with saving money.

The UNC Coup and the Second Limit of Economic Liberalism: Mike Konczal argues that Liberals are basically being limited because of an obvious desire to appeal to the middle class and leave things to the free market.

He also argues that the explosion in wealth via the financial sector has created greedy rent seeking due to a drop in progressive taxation, a focus on Wall Street has made the economy more about money than innovation, and monopoloization of various industries with a lack of anti-trustism is a huge blind spot for the liberal end of American politics.

Also there's an argument that a fair amount of the in-fighting between the middle and working classes is because so many industries, such as College, put the burden on the induvidual, and not the group. Basically the exploding student debt is in itself encouraging "Fuck You, Got Mine".

http://www.ft.com/intl/cms/s/0/e257ed96-6b2c-11e4-be68-00144feabdc0.html?siteedition=intl#axzz3JGsreTLG The Whacky Economics of Germany's Parallel Universe:

Surfing, Drowning, Diving: A Brief History of Inventing New Media

Marc Andreessen, a major venture captialist, argues that a lot of the crazy and wild ideas in the 1990s for the internet were completely on the nose, they were just 20 or so years ahead of their time. "Right idea, not enough breakthrough in technology".

Amazon and Hachette Resolve Dispute

The BBC: Robert Peston: Is the global economy headed for the rocks?

The dogged commitment to austerity is the problem. Japan's consumption tax hike is a particular Wall Banger (i just wrote my term paper for Macroeconomics on the fiscal and monetary policy arms of Abenomics, and any macro 101 student looking at the IS-LM model could've told them that hiking taxes undercuts fiscal and monetary stimulus, especially as regressive as a VAT)

What if evryone was supported by a base income, which is sorta like a social security? Everyone would regularly get enough cash or credit to support themselves . They could then supplement this money with a paycheck earned at a job. It would potentially eliminate poverty and increase consumer power

It's a good idea for a lot of reasons, but it is plain revolting to the average person on moral grounds regardless of its merits. The idea that a person would be able to choose not to work if they didn't want to, and would be supported by tax money, is inherently unpopular; for example, my family members universally hate the fact that I choose to receive welfare benefits rather than work.

edited 18th Nov '14 3:43:21 AM by Ramidel

What if people can't find work? Especially with a lot of jobs being replaced by machines

In a system where some people inherit tremendous sums of wealth without first engaging in a proportional amount of labor in order to earn it, a minimum guaranteed income is on morally firm ground.

It's going to have to happen in the 21st century. Even setting aside the concern of machines making large swathes of the population unemployable, the current welfare structure is set up under a 20th century mentality where A) Full employment is assumed as is B) Long term employment (jobs held for decades rather than years or less). The more fluid nature of the current labor market means that people need to be confident that they can lose jobs, a lot of jobs, and not be destroyed.

Either way, the basic minimum income would replace a lot of welfare, not supplement it.

What do you see as the result if a minimum income is not implemented?

We can muddle along in the near term, perhaps as far as the next quarter century. In the long term? Dystopia and/or revolution. Too many people will become unemployable, and policies to force people to work will seem senseless when capital is so productive that the productivity from machines will allow many of us to comfortably remain idle.

Is it finally time for the Glorious Worker's Revolution?

It's just time for welfare reform to match a more fluid workforce and more ephemeral labor market. The reforms will come before the bayonets do.

Dunno, I still think the latter will come first. Especially since most economic reforms nowadays are either: A) hurtful or B) half-assed.

edited 18th Nov '14 7:56:51 AM by Quag15

Hard to have a Workers' Revolution without workers (Less humorously, part of the basis for a workers' revolution requires workers to first down tools. I've previously pointed out that a general strike is unlikely to do anything if most of the population's jobs have been automated out.)

And I don't think a minimum basic income is a necessary policy, just a good idea that's unfortunately hamstrung by a pre-21st-century mentality. An increased focus on Keynesianism (including structural expansion of government jobs) would be economically equivalent, but more palatable to most and provide opportunities for pork and investment instead of just mailing everyone checks. We can have full employment if we're willing to subsidize said employment (sit down, Wal-Mart, you do not count as "employment").

edited 18th Nov '14 7:59:09 AM by Ramidel

We can have full employment today if we subsidize employment, and likely for the next couple decades. We cannot have full employment for too much longer. Hell, walmart will lose most of their jobs to automated registers and robots for stocking shelves and cleaning.

Honestly, if the government would just hire to the agencies to the level that of being functional, state and federal, that would save a shit ton of problems and give a lot of people work.

But thanks to screaming bloody, budget cuts all to hell, that won't happen.

It's all about the demand, stupid. Demand creates employment. We can drive demand in a large number of ways: we can directly employ people (via government jobs and contracting), we can boost incomes through various forms of wealth transfers, we can set minimum wages, we can even create money from thin air and airdrop it on people ("helicopter cash").

This is the fundamental lesson of Keynes. A post-scarcity society in which work is not necessary for survival can only function if we provide for that survival in other ways. If not, all we're doing is stratifying society further into haves and have-nots.

edited 18th Nov '14 8:41:40 AM by Fighteer

Instead, we seem to heading for an era of increasing wealth disparity, an ever larger proportion of the economy tied to financial speculation, unsustainable economic policies, environmental degradation, and widespread personal debt. We're heading for another economic crisis, and then the protests will spread.