The General Economics Thread

It also points out that if people work harder thanks to having lower taxes, they'll also earn more wage income, so there won't be more left over for the rest of us.

Although they will presumably spend it, depending on their income bracket. Money in the pockets of lower class conumers is better for the rest of us than in the stock portfolios of the rich.

The race to be home to Amazon's second HQ is on...but it may not be a good thing. Key points excerpted:

Based on this other article, and my own knowledge, I'd say the two big contenders are Boston and Atlanta (or somewhere fairly close to them). Whether it's them or a dark horse candidate, this is going to be a very big decision that will have long lasting effects, for better or for worse.

edited 3rd Oct '17 12:10:17 PM by TotemicHero

.. And this is why the USA really, really should copy the EU state aid rules. Because that would require local governments to tell corporations that go begging in this manner to fuck of.

Heck, implementing the portfolio of the commissioner for competition in its entirety would solve so many of the problems that plague the US economy. But that would require US politicians to act in the interest of the market, rather than in the interest of rich people...

Still, if the EU can manage it...

edited 3rd Oct '17 12:17:03 PM by Izeinsummer

Perchance, have you a source on the state aid rules or that portfolio. Those sound interesting.

http://ec.europa.eu/competition/state_aid/overview/index_en.html

That is the overview from the commissions own web page. That also has the legislation, and the rest of the portfolio. Note, that while the rules permit exceptions, a case like the amazon one where they are simply shopping for tax breaks would get laughed at.

Yeah, you would think that gov offering tax breaks to one company would be seen as interfering in the marketplace.

Sears Canada going out of business.

Crossed from US Politics. This is something I read recently as part of my personal interest in the guy I have for my avatar.

The Correspondent: The bizarre tale of President Nixon and his basic income bill

Basically, the current American conservative hysteria about "lazy poor people mooching off of the welfare system" has its roots in the opposition campaign against Nixon's 1969 Family Assistance Plan, which was the cumulative product of numerous studies and experiments during The '60s that purported that basic income would actually be a viable instrument for alleviating poverty.

Said studies and experiment did reveal that those with basic incomes worked less than those without, but this was actually because having a basic income enabled people to spend less time at a workplace and more time trying to develop their education and skills by taking college classes or searching for new jobs, which ultimately would enable them to find employment at better paying jobs in the long run.

However, all the conservatives needed to hear was the simple fact that "basic income makes people work less and become lazy!"

As part of their efforts to discredit the FAP (yeah, what an acronym), the bill's critics cited a British government investigation into a similar attempt at basic income during a severe grain shortage and famine in the 19th century known as Speenhamland system. Said investigation subsequently concluded that the radical policies had miserably failed due to mainly removing the motivating factors for food and shelter that invigorate people to work, and that continuing the policies would only aggravate the famine since people - now without having to busy themselves providing for themselves - would use their newfound leisure time to marry and procreate among each together and increase the number of mouths that needed to be fed.

From there, the Speenhamland report would be accepted as the definite case study of an attempted "welfare state" until The '60s, wherein the aforementioned tests and experiments conducted as part of the Johnson Administration's War on Poverty revealed that the Speenhamland policies actually were effective and that the entire report had been composed using bogus research methods so that British free-market advocates could avoid being thoroughly discredited by what were clearly socialist concepts.

Regardless of the fact that the Speedhamland report had already been discredited by academics, opponents of the FAP aggressively stirred up opposition based upon the "common sense" espoused in the former. The original British report was in fact so obscure that even Nixon himself had never heard of it until an adviser opposing the FAP showed it to him. Aware of how the notion of basic income was suddenly under fierce attack by conservatives in the days before the bill would be submitted to Congress, Nixon attempted to rephrase and amend the FAP as a "workfare" bill that would only allow those currently employed to be eligible for the basic income in hopes of reaching a compromise with anti-FAP congressmen. Unfortunately, his efforts proved to inadvertently sew even more discord between congressmen who felt that the bill was now being handicapped and those who believed it to already be going too far to begin with.

The Family Assistance Plan would be submitted twice to Congress. Once in 1969 and the other in 1971. Both instances saw the bill decisively passing the House of Representatives before being bogged down and failing in the Senate.

Following Watergate, the notion of government-provided welfare would become discredited at the same time as Nixon. Future presidents would sharply veer away from "workfare" and embrace "personal responsibility' as economic buzzwords, especially during the Reagan and HW Bush administrations. But it was the Democratic president Bill Clinton who in 1996 pledged an end to “the welfare state as we know it” as part of his campaign and sealed the deal for good.

edited 9th Nov '17 10:24:09 PM by FluffyMcChicken

Damn. Just damn.

Thanks a lot conservatives.

There was a study done in Manitoba back about 50 years ago into the basic income under a Liberal government. It did pretty much the same. People focused more on spending time with family, getting higher education, a few people looked more into art, and it practically ruined one guy who’s store was really exploitative because no one had to work there anymore.

And then a Conservative government came in and then buried the results as much as possible.

Because it turns out that humans get bored pretty quickly and start looking into other things to do. Because we very clearly aren’t designed to throw everything into work we hate and we aren’t designed to sit around doing nothing. Yes, there are people who will do nothing but sit around and watch TV if given the opportunity. I can guarantee you though that those people aren’t actually very happy. One possible result of a UBI is a huge boom in the arts because people suddenly have the time and inclinations to do that.

Because it’s not lazy to not want to have to spend every waking hour to do the minimum required for survival. It’s not lazy to want to spend time with your family, or to have fun.

No doubt the Conservative government bigshots saw themselves and their donors in that one guy.

Honestly, UBI will become a necessity in the future.

We're slowly working towards a post-work future, where the need for actual human labor will be greatly reduced and most tasks will be taken over by automation.

Aside some fields of work, that are practically impossible to automate, the sheer majority of the productive sectors will be automated. Right now it is hard to keep the able bodied population employed with good conditions.

Granted that without the need to actually work in unpleasant jobs people would certainly quit on awful employers. Either the business actually become labor friendly or they vanish. It would also give more incentives to lower work ours or better working conditions, even if the wages are low, people would still work just to have that extra income to spend in things they want instead of things they need.

Dumb question: when I see statistics on average wages, is it normally nominal or real wages?

I think when current wages or a lack of wage increases are mentioned, it's nominal—the problem is not keeping pace with inflation. Not sure how often real wages are correctly used in most publications to make comparisons, but it's probably a case of "are we being nostalgic or trying to insinuate modern workers have it great and should shut up".

Was chatting to someone about politics not too long ago, and they said they supported a certain party because "they're for business, and if business does well, the country (or 'everyone' in other words) does well".

From that short statement, would it be fair to conclude that this person holds a neoliberal economic stance?

edited 28th Nov '17 9:35:15 AM by GoldenKaos

It'd be fair to assume the person is an idiot with an overly simplistic worldview.

Whether or not that equals neoliberal...

No, not really. "Neoliberal" is a largely meaningless term, anyway, at least in America. I haven't heard the term used unironically by anyone who isn't using it to bash centrist Democrats. Supposedly, it's someone who supports social liberalism while being in favor of free markets and free trade, but it's such a broad brush that it has almost no value except for rhetorically branding people whose views you don't like.

"When business does well, we all do well" is the kind of trite observation that may mark someone as belonging to a right-leaning economic doctrine, but it's by no means a definitive sign. You'd need to dig further.

edited 28th Nov '17 9:39:01 AM by Fighteer

It’s possible, but it’s equally possible that that regurgitated sound bite is the extent of his thoughts on economics in which case it probably wouldn’t be fair to call him that.

I’ve generally found that the term referred mostly to a person’s economic views, which is why it is often referred to as “Free Market Fundamentalism” in order to emphasize that fact.

Though indeed it has been misused plenty of times to defame liberals who people don’t find to be sufficiently left leaning.

edited 28th Nov '17 10:07:56 AM by Mio

Yeah, that guy's ignorant, pure and simple.

What? Unless the meaning totally changed in the US, neoliberalism is still a clearly economic term: Hayek, Friedman, Pinochet... free market to the extreme.

These days Neoliberalism is just a buzzword used by stupid elements of the left to try and deface anyone they don't see as sufficiently extreme.

No, no, that's '"'liberatrianism''".

No, neoliberal is pretty much used as an insult of the same vein of socialist or communist, mostly because of the negative baggage attached to the term.

@Raineh: That's the problem. The term has no clear definition. Sure, it can mean "free market uber alles" types, but that same doctrine can also be included under several other labels, such as Austrian, Free-Market Libertarian, Objectivist, Neoclassical, etc.

Some people will call you a "neoliberal" if you aren't for killing all free trade agreements and banning corporations.

edited 28th Nov '17 1:49:00 PM by Fighteer