No Mr. Romney, Rich People Do Not Create Jobs

Originally posted by bigfatfurrytexan
My god, i made it through only 2 pages before I decided my pain threshold for poor understanding and loose logic was reached.

Rich people create jobs. If you dispute this, you are doing it by just making stuff up. I know 4 rich people right now who are opening 4 separate hotels that have been mothballed for 20+ years each. They do this by leveraging their net worth for loans that allow them to create the cash flow needed to open a business (each costing in the 30mil + range).

Added in are a bunch of tax credits, etc. An example are the historic tax credits that can be recieved if you follow historic guidelines while restoring. THIS is a "good" tax break for the rich. It creates an ability to create cash flow (by selling the credits on the open market, like you would carbon credits) that allows a recapitalization in the business, or a tax break once opened that allows you to operate more functionally in the first year.

"Bad" tax breaks are income tax deviations. For the life of me i cannot understand two things: why we still have the electoral college, and why we have not instituted a flat tax or a consumption tax.

The four rich people that you "know" would not be buying up and leveraging their net worth for loans on 20-year-old-mothballed hotels unless the area around them was doing better, or the base economy that they sit in was doing ... better!

They would not be everaging their net worth if they did not think they could pay off those loans. The people paying to fill those rooms gives them incentive to invest in those hotels.

I'm sorry bigfatfurrytexan, but your logic fails.

People with money only invest when they believe there is money to be made.

So, apparently the economy is improving enough around these 20+ year old mothballed hotels to necessitate bank-financed investments?

reply to post by MystikMushroom


Exactly! The rich business owners have for far too long been short changing the workers, so the customers, and are now running out of customers, as the workers cant afford their products, so they cut jobs, which makes even less customers, which creates another round of pay and job cuts, which once again, further erodes the customer base.............and so it goes on and on until it all hits rock bottom.

Under the system I mentioned, this would be easily avoidable, as the workers would always be in the loop on the pay side, so businesses would always have a customer base( provided they were selling products the customers wanted of course) and would cancel out the above mention self destructive cycle.

Since the workers, thus the customers, would always get a proportional cut of the businesses profits. I believe this really would fix the economy, almost over night.

The real change we need is not found in furthering this parasitic business model, but in a more symbiotic model, where both working together can accomplish more, instead of the parasitic model we use now where, those that already have money continue to take as much as they can and give back as little as possible. Which results in the employee doing the same, so productivity is low, quality is low, and worker/customer gets the shaft.

I cant believe someone smart enough to get so far ahead cant see the self defeating business model they are using now, there cant be demand, if there arent any customers, there cant be any customers if workers dont make enough to buy goods, if you cant sell your goods, there is no point in having a business to begin with.

reply to post by randomname


Isn't it funny how your post just proved that the concept "consumers create jobs" is a fallacy? I think it very funny. Consumers do NOT create jobs. They create demand. Demand does not begat supply without SOMEONE having the means to create the supply. The jobs are the supply side. Demand INFLUENCES what will be supplied, but demand can never create supply without resources from someone willing to create the supply. Those "resources" required to create the supply are the jobs.

We can all demand until the cows come home but if we're all piss-poor because we all had to give everything we've got to a 308,000,000 hand pot....we'll just all be sitting around demanding.

BUT....nobody will be crying "it's not fair" anymore, right?

The OP tried hard, but just basically presented a contorted view of the world in order to try to back his own wishes.

reply to post by MystikMushroom


Wait, did you move the target on me?


I thought we were talking about wealthy people creating jobs. Not about how the local economies drive the macro economy.

Stay on target, man.

And you are right to put "know" in parenthesis. I am not wealthy by any stretch of the imagination. And do not like socializing with wealthy people, as I think they have a poisoned worldview for the most part.

Explanation: S&F!

Only within civilized society can legal business take place or its out in the wild and carried out by outlaws.

Only the People can allow business to occur. It has to be legislated for or its outside the law.

The entire federal/local states assets include what you assume is yours ... including yourself.

The state can simply order you persona non grata, taking what they want and its game over for you and even if they break they law that doesn't help you when your carcass [aka dead].

Why is this so ... because the state PRECEEDS US ALL and will SUCCEED US ALL ... even if its broken gameplan.

Is that money ours ... nope! IT DOESN'T HAVE OUR NAMES ON IT!

The pen is mightier than the sword ... since although the sword can take aways someones life, it can never sign over power of attorney.

YOU SIGNATURE IS THE MOST POWERFUL THING [aside from your own brain] THAT YOU CAN WEILD without devolving into being wild.

And everybody has one!

The devil doesn't deal in Dollar$ ok.

Words define and contracts BIND!

Personal Disclosure: Politicians come and go .. POLICY IS FOREVER!

What will you sign up for today?

Rich people don't create jobs, poor people do. And they do it without any money, and without any training or experience, but they just do it because they're poor and not rich. Without credit or collateral they can just go into any bank, get turned down for business loans and then even after that, they can still create jobs.

If you believe that, keep drinking the cool aid.

Those who have wealth, invest it in order to create products for sale, services to supply, and industries to manufacture. Those who get such investment turn profits, and hire even more people who buy and or sell even more, which means that industrial production goes up, jobs by the millions are created and tax revenue coming in to the government increases across the board. For their part, tax cuts mean even more capital investment further fueling the robust economy and creating even more jobs causing even more tax revenue to come in to the government which means no extra borrowing and a freeze on the deficit.

If you believe this, this was the Ronald Reagan era economy, and this was what he did allowing those with wealth to invest it into the economy.

The economy under Obama says place punitive taxes on those who have wealth. In turn they will keep what they have left. Without investment, the economy falters, sputters, and recedes into negative growth. Businesses across the nation lay off workers and millions of jobs are lost, some for ever. Businesses then begin to look for better pastures oversees and move there. Revenue coming into the government falls short and we borrow from China to keep it going. Many more people end up on government assistance and trillion dollar deficits are needed to compensate. Stimulus money is injected by the government but the banks refuse to loan in a bad economy. We go into a deep recession for four hard years.

Now I ask, what do you want ? Four more years of tax, borrow, and spend ? Or a job, money in your pocket, and independence ? The choice is yours.

reply to post by MystikMushroom


I can speak to the DoD budget. I can tell you America can reduce the spending there and still maintain a good fighting force. Why? A large portion of that spending is wasted. Too many contractors making a killing doing very little, too many companies "supporting" DoD installations that charge insane fees for what they provide, to many items purchased are priced beyond the moon, etc.

Matter of fact, you could actually increase our troop strength (they do not cost a lot in comparison) and reduce the budget. Too many politicians link cut budgets with less defense capability. Not true.

Like anything, the money needs to be spent wiser.

Milking the government has become a business in itself. Except a lot of these 'businesses' do not produce anything and reap profits far in excess what the market would normally produce. Part of the cost of doing that business is manipulating the purse strings (Congress) to allow it to happen.

reply to post by Valhall


Would you disagree then in order for the 'free market' to operate, you need both supply and demand? You need both demanders and suppliers? You need an environment where that balance is allowed to happen free from bigger more powerful things humans are capable of?

reply to post by ABNARTY


I think this is not a closed issue.

For this "system" to work, it appears a symbiosis has to occur between the elite and the working class.

Originally posted by ABNARTY
reply to post by MystikMushroom

 

I can speak to the DoD budget. I can tell you America can reduce the spending there and still maintain a good fighting force. Why? A large portion of that spending is wasted. Too many contractors making a killing doing very little, too many companies "supporting" DoD installations that charge insane fees for what they provide, to many items purchased are priced beyond the moon, etc.

Matter of fact, you could actually increase our troop strength (they do not cost a lot in comparison) and reduce the budget. Too many politicians link cut budgets with less defense capability. Not true.

Like anything, the money needs to be spent wiser.

Milking the government has become a business in itself. Except a lot of these 'businesses' do not produce anything and reap profits far in excess what the market would normally produce. Part of the cost of doing that business is manipulating the purse strings (Congress) to allow it to happen.

edit on 20-10-2012 by ABNARTY because: grammer

Do you have any specific ideas where the DOD could shave costs? I think we could do things smarter, leaner, and more efficient myself.

I know that DARPA has some very exciting technologies in development.

reply to post by MystikMushroom
Thoughts?

They never really belived in Reaganomics.
But the alternative just hurts too much. They just love their money so much even taking down USA isn't to higher price to pay. Or after 60 years of anti socialist propaganda they can't turn away from the myths they've created for themselves.
Some might think Milton Friedman told the truth but most just took when the opportunity presented itself.
This is soooo old MystikMushroom. The owners are always outnumbered and therefore think themselves forced to fight dirty to protect their gold and social privileges.
Trickle-down economics is a tool for social control.

reply to post by Fromabove
That is such a one dimensional outlook.

What you describe does not happen or at least is now not the norm. Multinationals do not create jobs or products. The buy out successful businesses or out compete them. They then cut jobs, wages and watch the money role in.

The only businesses that are hit by punitive taxes are the small local businesses that do supply real jobs and do pay a fair wage to its workers.

The one thing that multinationals do not do is pay taxes and no there is no excuse for them not to do so. As it is now they are just huge bloodsucking leeches and the chosen hosts are running out of blood to feed them.

Milking the government has become a business in itself.

reply to post by ABNARTY

Very true. How many people remember the $900.00 screwdrivers that the government paid for back in the 1970's.?
OF course, that is small potatoes compared to the billions on expenditures for "studies" which are nothing more than justification for something that they want. Anyone with half a brain knows that those that perform the studies are TOLD what there conclusion will be in advance. A perfect example is the Condon Report on UFOs. The government "commissioned" the University of Colorado and Dr, Edward Condon to conduct a study on UFO's. For those that don't already know, and I suspect most ATS members do, here is what Condon said BEFORE the study:

In late January 1967, Condon said in a lecture that he thought the government should not study UFOs because the subject was nonsense, adding, "but I'm not supposed to reach that conclusion for another year."[2] One NICAP member resigned from NICAP in protest and Saunders confronted Condon to express his concern that NICAP's withdrawal would eliminate a valuable source of case files and produce damaging publicity.

en.wikipedia.org...
There are thousands of examples like this, but this is one where Condon, supposedly an "intelligent" person, ACTUALLY admitted that the study was rigged BEFORE he finished it.

reply to post by MystikMushroom


The way the rich play games with the poor and middle class people, there's no such thing as trickle down anyway. It's called trickle in, and this phrase I may have just created for the sole purpose (although I won't swear to it maybe other people have used to jeer at the current economic system, I don't know) of this argument I'll believe, the phrase means this come money trickle into my wallet.

Originally posted by 1loserel2
reply to post by MystikMushroom

 

The way the rich play games with the poor and middle class people, there's no such thing as trickle down anyway.

It's called trickle in, and this phrase I may have just created for the sole purpose (although I won't swear to it maybe other people have used to jeer at the current economic system, I don't know) of this argument I'll believe, the phrase means this come money trickle into my wallet.

Well, and this is what happens.

Consider that a large portion of business investment in America has been outside dollars. Indian hotel owners and doctors, for example. And a HUGE amount of that money is shipped "back home" to help their family realize the American dream, too. Even though they aren't in America.

The US exports two things: debt and cash. Think about that. Think about all the foreign business people in the US making large amounts of money and exporting it back home. Extracting value from our economy, injecting it into theirs. How much of that trickles down here in the US? I see it trickling down in India and China, where the standard of living is exploding. That is your US dollars value being sucked into those economies.

Trickle down was a GREAT theory, back before the globalized economy. It won't work anymore. And it only takes a little common sense to see it.

reply to post by bigfatfurrytexan


I think you've brought up an important issue: globalization.

I don't think we could have ever prevented globalization from happening, and I don't think enough people fully understand just what globalization has done to the USA.

Most of the voting block has a very basic understanding of economics. Work a job, get paid, spend money, repeat.

I can still remember the Seattle protests/riots over Globalization several years ago. Back then, I really didn't a clue as to why these people with black bandanas were busting up stores. I didn't understand the issue.

Having said that, we do now live in a global economy. The internet comes to mind as one of the vehicles that allowed it to happen.

Change is inevitable, but it's in our hands to make sure that change is forward progress.

To Prof Em:
Good example. The sad part is most tax payers have little idea this goes on. Or perhaps they do but it is so foggy or abstract there is no traction on it.

BFT:
We do export debt and cash. I guess if we wanted to be exact, the cash is debt so it would be hard to do one without the other.

MysticM: Examples of how to trim the DoD budget? Good Lord, you wanna get me fired?

Straight up, there are things you need to defend your country. It will cost money. Quite a bit of it. However, there is a lot of stuff we could probably do without or perhaps keep but have adult supervision involved in the procurement/budgeting/utilization of.

The undisclosed government facility I work at needs routine maintenance. Nothing amazing there. However, some of that maintenance is so routine, it can be accomplished by the military members who work there everyday. Matter of fact, pre-9/11, they did do these things. Take out the trash, sweep the sidewalk, shovel the occasional snow, etc. Now, there are contractors who do this. To some degree, this is understandable as the last ten+ years have been hard on uniformed members. They are rarely around and stuff still needs to get done, right? But the price these contractors charge is astonishing. To shovel the occasional snow in front of the entrance way (about 20' by 40') costs the tax payer $500 a pop. Wanna empty the trash cans in the building? $2000 a pop. Wanna try to make something happen in theater? A latrine with running water? Be prepared to fork over $100,000. I could go on but it nauseates me. You get the picture and nothing secret squirrel has been disclosed

Good News Everybody!

I have some new material to share to kickstart this discussion thread!

The top income tax rates have changed considerably since the end of World War II. Throughout
the late-1940s and 1950s, the top marginal tax rate was typically above 90%; today it is 35%. Additionally, the top capital gains tax rate was 25% in the 1950s and 1960s, 35% in the 1970s; today it is 15%. The average tax rate faced by the top 0.01% of taxpayers was above 40% until the mid-1980s; today it is below 25%. Tax rates affecting taxpayers at the top of the income distribution are currently at their lowest levels since the end of the second World War. The results of the analysis suggest that changes over the past 65 years in the top marginal tax rate and the top capital gains tax rate do not appear correlated with economic growth. The reduction in the top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie.

This conclusion is not from a blog, or a news website.

This information is directly from an official Congressional Research Service study. The entire .pdf can be found here:
Taxes and the Economy: An Economic Analaysis of the Top Tax Rates Since 1945

reply to post by MystikMushroom


You couldn't have prevented globalization. But you can make trade policies that benefit everyone not just the top guy. You want to open up the third world, that is all well and good but we aren't just going to let you undercut the working class here. You have to set policy that doesn't allow the exploitation of the working class in those countries. Either you pay comparable wages or we raise tariffs to offset those savings. We don't have these trade issues with modern first world countries, because those workers have a comparable standard of living. Global trade policy is supposed to work in a reciprocal fashion. We build some factories there to service that market, they build some here to service our market. Our trade policy makes it advantageous to just manufacture there, without this country getting any benefit.

This is why Romney is pushing to open more free trade with South America. The Chinese and Indian workers are starting to demand better wages and working conditions. So now we need more bad trade policy with new developing countries with labor we can exploit. This is another reason the Mexican border is a war zone. NAFTA created a boom on the border, things were prospering there and then we allowed China in the WTO creating a bust on the border leaving once prospering people to resort to crime to get ahead.

reply to post by ABNARTY

No way.

It's not just about how hard you work. That doesn't make people equal. It's about whether your choices are smart or not too. Two people can work equally hard (equal number of hours worked and effort invested) and yet one makes much more money. That's because that person made choices that'll earn more money. Luck rarely has anything to do with it unless you're meaning the lottery. That person also might be said to have more value to society. Society values smarts and always will. Better choices and more money means that person is probably doing something more valuable.

It's not just about using your time to do something, it's about HOW you use it. Breaking a sweat isn't good enough. Working 70 hours/week ain't either. To really cut it, you have to be smart.

You know as well as I do there're many people in this world working 12-16 hour days for 5+ days per week and they're making pennies compared to everyday american workers.

I don't know whether this is true or not, but it can't be far from the truth. I know there're people working long hours for low wages and this is nothing new:
www.ilounge.com - Low wages, long hours for iPod factory workers...
And this:
articles.sun-sentinel.com -
Cruise Liners No Luxury For Crew As Long Hours, Low Wages Prevail...

For that matter, people at the local cannery in my area will work 12-14 hour days for a couple months with no days off except when they get delayed (which happens periodically). Of course, they get paid minimum wage. And the work is hard, very hard. Cold, wet, long, hard on the body. I know because I've worked at a couple. We even sat around for several hours waiting for a boat to come in. Compared to other work I've had, it's twice as hard at least on the mind/body to keep up with it. And this is in a blue state. Red states generally have less regulations in-place to better compete. But honestly, if there's any difference it's probably not significant. 12-14 hours/day is -always- brutal.

Here:
www.ehow.com - Facts About Nike Sweatshops...

.........
While these were perceived as positive efforts on Nike's part, the human rights campaign against the company have not ended. According to the Educating for Justice group, between 50 and 100 percent of Nike factories require more working hours than those permitted by the Code of Conduct. In 25 to 50 percent of factories, workers are required to work 7 days a week, and in the same percentage of factories, workers are still paid less than the local minimum wage.

Point is, hard work alone earns you money, but it won't make you rich or necessarily important.