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yep, cutting taxes on the 1% and corps / trickle-down is a scam by the VRWC buying Congress and well known for 35 years.
Ryan and House Repugs have passed his screw-the-47% and enrich-the-!%+corps budget 3 times. aka, more trickle down scamming.
Read more: http://www.businessinsider.com/rich-...#ixzz2mGlvgc3BAs America struggles with high unemployment and record inequality, everyone is offering competing solutions to the problem.
In this war of words (and classes), one thing has been repeated so often that many people now regard it as fact.
"Rich people create the jobs."
Specifically, by starting and directing America's companies, entrepreneurs and rich investors create the jobs that sustain everyone else.
This statement is usually invoked to justify cutting taxes on entrepreneurs and investors. If only we reduce those taxes and regulations, the story goes, entrepreneurs and investors can be incented to build more companies and create more jobs.
This argument ignores the fact that taxes on entrepreneurs and investors are already historically low, even after this year's modest increases. And it ignores the assertions of many investors and entrepreneurs (like me) that they would work just as hard to build companies even if taxes were higher.
But, more importantly, this argument perpetuates a myth that some well-off Americans use to justify today's record inequality — the idea that rich people create the jobs.
Economic Policy Ins ute
In the last 15 years, almost all of the income gains have gone to the richest Americans.
Entrepreneurs and investors like me actually don't create the jobs -- not sustainable ones, anyway.
Yes, we can create jobs temporarily, by starting companies and funding losses for a while. And, yes, we are a necessary part of the economy's job-creation engine. But to suggest that we alone are responsible for the jobs that sustain the other 300 million Americans is the height of self-importance and delusion.
So, if rich people do not create the jobs, what does?
A healthy economic ecosystem — one in which most participants (especially the middle class) have plenty of money to spend.
Over the last couple of years, a rich investor and entrepreneur named Nick Hanauer has annoyed all manner of other rich investors and entrepreneurs by explaining this in detail. Hanauer was the founder of online advertising company aQuantive, which Microsoft bought for $6.4 billion.
What creates a company's jobs, Hanauer explains, is a healthy economic ecosystem surrounding the company, which starts with the company's customers.
The company's customers buy the company's products. This, in turn, channels money to the company and allows the the company to hire employees to produce, sell, and service those products. If the company's customers and potential customers go broke, the demand for the company's products will collapse. And the company's jobs will disappear, regardless of what the entrepreneurs or investors do.
yep, cutting taxes on the 1% and corps / trickle-down is a scam by the VRWC buying Congress and well known for 35 years.
Ryan and House Repugs have passed his screw-the-47% and enrich-the-!%+corps budget 3 times. aka, more trickle down scamming.
"We live in a kleptocracy. Deficit hysteria is just a convenient con to loot the rubes. The power of the monetary sovereign to create unlimited financial resources is reserved for the use by the rich and elites. The rest of us are forced into the constraints of the gold standard (although the US went off the gold standard 40 years ago) and austerity. We are told for us there is no money.
It is important to note that while the monetary sovereign can create infinite financial resources, it can not create actual resources. Rather it can use its fiscal and monetary powers to effect redistributions of actual resources, and these redistributions of actual resources can result in the creation of new actual resources, accomplish a social good, or as now, destroy both current and future resources."
Heard on NPR that startups don't really create that many jobs because many entrepreneurs don't want to manage a 100 or 200 person company, want to stay at 20 or less.
Yep, rich people don't, people with CAPITAL do.
ignorant , capital is wealth, money beyond the cost of operations. iow, wealthy people have capital, and they invest in the funny money, corrupt financial casino, not in The Real Economy.
So Winehole do you agree with the article...that consumer spending is the real driver of economic growth?
I get tired of these threads that promote whining.
Appeals to intuition; complex systems would seem to need more than top down inputs. Honestly, it's not easy to know the answer to questions like this. Silly to think, I hoped the article might spark a conversation.
a cheap win: you've proven your point by whining.
.
the feedbacks caused by broader patterns of consumption and growth, including such intangibles as "animal spirits" are considerable; in this sense investment is just one facet of a golden egg that lays itself, so to speak. it might be a mistake to explain the outputs of highly complex systems by reference to linear causes.
Consumer spending is an engine that creates need or cause, but not many jobs are created by the 64k/yr set.
As one small example. Steve bought a small print shop. 2 employees. He knows marketing. He expands the clientel and generates demand for his business. He buys 2 new 4 color presses from an American company because supporting the domestic economy is important to him....just like David MacNeil (Google him if you must). He hires 5 more printers at 18.50/hr. to man them. Bam. Job creation
but without demand, no new jobs, no? companies don't expand when people aren't buying.
did the job create the demand, or is it closer to the truth to say the reverse?
In t hat particular example, he created demand through marketing. But as I stated upstream, demand is an engine of cause for sure. Its a combo.
whether we're looking at the aggregate or the particular instance, as you point out, does matter. generalizing from the particular and using macro-level generalizations to explain particularities are both probably as persuasive as they are wrong -- which is to say, very persuasive and very wrong.
Last edited by Winehole23; 12-02-2013 at 02:07 PM.
I think if you are in a position of wealth, you have the ability to harness demand to create jobs. Its a partnership.
when statistics and scientific theories dovetail with what we think we already know, they get roped into pseudo-rationality and the agonism of competing glibnesses. it can be hard to resist.
Last edited by Winehole23; 12-02-2013 at 02:16 PM.
Glibnesses. I gotta write that one down.
As a cut and paste to the OP...callback to Harry Reid's unicorns.
http://www.forbes.com/sites/paulrode...ing-a-whopper/
You can generate demand without wealth. You can't generate wealth without demand, but wealth is required to fulfill demand.
the old-fashioned distinction between rentiers and producers would seem to be lost on Sen. Reid and new-fangled promoters of social resentment.
There is no demand for something before it exists.
What was the demand for Amazon's air delivery system before yesterday? It was 0. today? A lot higher.
It can't exist without capital investment. That isn't the same thing as trading stocks.
And the FED puts that capital into the wrong sectors (like financial markets) through its manipulations.
you can build little, sell a little, build a little more, repeat, repeat, repeat, generating profits to finance the next round of build. and each iteration of build should increase the skill to build it.
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