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Some thoughts on improving our economic system and currency

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posted on Jan, 14 2014 @ 09:23 PM
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Our economic system right now suffers from one main problem. Productivity is so high that a segment of the population less than the total is all that's needed to work in order to provide for everyone. Currently here in the US that's a 24% real unemployment rate meaning only 76% of the population is having to work to provide for the total. This number falls further once you start taking subsistence wage jobs which are supplemented by safety nets from the total.

Another thing we've seen is that the same good sold in the US can be sold MUCH cheaper in a foreign country where people have less money. The price of goods scales far more than is expected just due to the differences in labor costs.

Last, we're currently witnessing the failure of capitalism. In the recent past we've seen communism fail because while it works perfect if everyone works for the collective, we know that people work instead for self interest. The advantages of communism don't outweigh this fundamental flaw. Next we're seeing the rise of socialism, which also has a flaw. It is trying to create broad social safety nets that provide everyone with security, however these nets are ever expanding in cost, which requires an ever expanding increase in taxes. Eventually these taxes stifle the economy, and create a downward spiral where the spending can no longer be maintained. At the same time however as I said we're also witnessing the failure of capitalism. Capitalism seeks to generate an ever increasing profit, the best way to create this profit is to create repeated rather than one time purchases. As an example in the year 1900 a light bulb could last years or decades, there are even lightbulbs in use today that were plugged in, in 1900 and have worked faithfully for over a century. This is bad for continued profits so capitalism creates inferior goods. In pursuit of those profits however we have ever decreasing wages. In the 1950's, the golden age of America a minimum wage job such as a burger flipper at McDonalds provided enough income if one worked full time to eat well, own a house, and goto college without public assistance. Today minimum wage with no assistance doesn't even cover rent in a slum and basic food.

Given these constraints I have an idea to reform traditional labor and avoid the pitfalls of all three systems while incorporating their advantages.

First of all we need to reduce the work week. The work week was last reduced in the early 40's from 44 hours to 40 hours. Since then productivity has increased considerably. I would propose reducing it to 25 hours/week (this would require a slight change to Obamacare), with overtime laws being 1.5x pay from 26-32 hours, and 2.5x pay past 32 hours.

Business hours would remain the same to meet customers needs while the work week for an individual would shrink, this would create a HUGE need for more employees where anyone who wants a job could find one in any field they are qualified for. This would end unemployment overnight.

Another effect of this however is that incomes would drop by 37.5% because people are working 37.5% fewer hours. This can be addressed through simultaneous currency reforms which I'll get to in a moment, so don't forget this point. The currency reforms are very important to this and are in the first reply.

Next comes taxes. On a federal level we could eliminate sales, income, and corporate taxes. Instead tax revenue would be raised through a 1% tax on all wall street transactions and for US residents a 1% tax on any foreign stock exchange as well. This would generate about 16 trillion annually with no drop offs in investment rate. This is enough money that we could quadruple areas like NASA, give free college to everyone, real health care reform, increase our defense budget by 50%, meet all obligations, and still have an 8 trillion annual surplus.

Naturally, a tax on Wall Street will lead to a drop off on money, if that's what we're reliant on for our income we need a way to prevent this. So here's what we do.

First, we eliminate tariffs on foreign goods, this encourages companies to import goods to the US. However we create a requirement that says if a corporation wishes to sell in American markets atleast x% (33%?) of their goods sold here or their monetary equivalent must be produced in the US domestically. With our 0% corporate tax this should be quite appealing to them. This creates even more jobs. Next we pass a law that says a US corporation, may only be traded on a US exchange. In the case of multinationals that do a large amount of business in the US we again require them to be on a US exchange if they want to sell their products here. These factors combine to keep US corporations in the US, which keeps our exchange attractive to the rest of the world despite the tax, provided our companies can produce.

So now we get back to that tax surplus, what do we do with it? I'm sure many here will say we should pay down the debt. International finance doesn't work that way however (I can go into this more if required), what we need to do with the debt is grow it at a slow, steady, manageable pace that's in line with inflation. Instead what we do with this surplus is give it to the American people as an economic boost. With 8 trillion in surplus (in reality it will be less because we'll see some drop off from the stock exchanges) we can give everyone a pretty large paycheck every month. This money will be spent in the economy creating a huge stimulus, furthering the sales/expansion of our corporations, which in turn helps their stock prices and makes them more attractive to investors.




posted on Jan, 14 2014 @ 09:24 PM
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Now we get to the currency reforms:
Rather than have one currency that purchases all goods, my proposal is to use a combination of two currencies. The first would be dollars just like now, comes from working, functions as the medium of exchange, and is used to pay taxes but the second currency would be something new. I'm quite bad at naming things so lets just call them credits. The point of these credits would be that the government provides them to people at an equal rate, as an example we could say everyone is given 500c each at the beginning, and then everyone is given Xc per month based on how many are spent to prevent inflation. This would ensure that at the first of each month there is always a set number in the economy.

These credits would also be required in order to purchase non perishable physical goods from a store. For example, a dinner at Applebees, a drink at a bar, watching a movie in a theater, or getting a haircut, or paying rent (in most cases) wouldn't cost credits but a new car, a video card, a trading card, or a screwdriver would. While the dollar cost of a product would remain entirely up to the market, the government would determine the credit cost of an item. The reason for this is it allows for a free market that can take advantage of having a mixed economy. If you want to see an example of this in action look at China during recent decades, this is the same trick they're using to overtake the world (though they do it with 1 currency).

Banks would be required to offer accounts for credits for the purposes of things like direct deposit and debit cards to easily spend credits, however they would be forbidden from investing these credits and they would not be allowed to apply fractional reserve banking to them. There would be no credit credit market (credit was probably a poor name choice by me). However, banks would be allowed to offer credits in cash form against the value in a persons account so that electronic only transactions aren't required.

In addition to this there would be an online government exchange where people could buy and sell their credits at whatever rate the market dictates. The exchange would offer escrow and insurance, and be provided at a 1% transaction fee (to be used for the upkeep of the program). Individuals could also build their own independent exchanges at whatever terms and with whatever benefits they wish. The government exchange would simply serve as a minimum quality standard and guarantee of there being a market. Exchanges would also allow for transactions to a specific party rather than just the highest bidder.

Credit prices would only be strictly regulated when buying a new product, if buying something used (such as a used TV) the price could be left entirely up to individuals however a law (though probably unenforceable) would exist saying a second hand good couldn't sell for more than 33% of it's value when new.

Credits spent on new goods would be destroyed, they would not be recycled into the system, only individuals not corporations could own credits.

The outcome of this system is that there would be a premium on reusing and repairing goods as it would become far more cost effective. This means that manufacturers would have an incentive to create products that last for 30 years or even a lifetime like used to be the case. This means American products would quickly gain an international reputation as being very high quality and lasting forever. This gives our corporations another massive competitive advantage, which would be reflected in investor interest.

This has another effect too that it would cost us less to have stuff. Rather than have to rebuy an appliance every 1.5 years for example they would last for several decades. This means we spend less money on lifestyle upkeep which greatly offsets the reduced income from a reduced work week. Essentially, this puts an end to the concept of planned obsolence which is doing great harm from all angles. It makes our products more expensive, it creates oceans worth of waste, it reduces the quality of goods, and it stifles innovation since long term planning isn't rewarded.

With the ability to sell credits for dollars, concepts like homelessness would virtually disappear because everyone would have a worthwhile commodity to sell in order to meet basic needs, and it could be done without expanding welfare.

Taking everything combined we could see a massive improvement in the quality of goods produced, given proper pricing we could even set up situations where it becomes more profitable for a pharmaceutical company to cure a disease rather than treat the symptoms. Just imagine that type of world.



posted on Jan, 14 2014 @ 09:29 PM
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I really like some of idea your ideas and i like where your heads at.

Heres my one stop shop for solutions to ALL of the worlds problems and it really boils down to one thing....

EGO!!!!!

If we can destroy this horrible disease then we the world and the universe will be ok.



posted on Jan, 14 2014 @ 09:49 PM
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Read the first post, so far I like it.

Haven't read the second, so I won't comment yet.



posted on Jan, 14 2014 @ 10:25 PM
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reply to post by Aazadan
 


To me this would be more confusing and make for easier manipulation than our current system.

Decreasing the work week would have stimulus benefits as long as the value of 25 hours paid the same as 40 hours currently pays in value. The only way I see this is possible is if upper management would lessen income to a closer ratio of the base workers income. Dividends on stock and company growth would also take a hit. More company wealth distributed to employees would end many companies that are barely surviving for sure.

Once you open credit to cash exchanges based on market value you basically have the same thing as cash. How do you plan on lowering the supply of credits? If you keep handing them out 500 every month eventually your 500 credit subsidy will be worthless in a couple years. Why not just hand out the subsidy in cash? You also have to consider since the supply of commodities varies the commodities to cash to credits trade will impact the value of credits.

How do you distribute the cash money? Is it debt backed money distributed by bank loans? If so than eventually the cash system will hyperinflate to collapse like our current system will.

If you give enough credits to cover basic needs than a sizable percentage of people wouldn't work. Then you have the scenario where a small percentage of people are working to make enough goods for everybody.

The idea has good intentions but it would fail in the real world.



posted on Jan, 14 2014 @ 10:34 PM
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Investors.. They are a SCOURGE and the MAIN problem.

They are sucking the economy DRY>

when the Rich can use their current wealth as BULLIES and pick our pockets every time we buy something, that is the MAIN problem.

There isn't enough money left to pay those actually doing the WORK..

When the rich invest.. they are taking more out through profits than they put in through capital..

If you didn't 'build that' you get NONE of the spoils. Why should the people that actually do the job having to share THEIR earnings with someone (sometimes a foreigner) who did NONE of the work.

The people with money use it to STRIP the earnings of the working class..

If you already have money, you should NOT be allowed to use that money to control what the workers make!



posted on Jan, 14 2014 @ 10:58 PM
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SouthernForkway26
reply to post by Aazadan
 


To me this would be more confusing and make for easier manipulation than our current system.

Decreasing the work week would have stimulus benefits as long as the value of 25 hours paid the same as 40 hours currently pays in value. The only way I see this is possible is if upper management would lessen income to a closer ratio of the base workers income. Dividends on stock and company growth would also take a hit. More company wealth distributed to employees would end many companies that are barely surviving for sure.


Take home pay would lessen, that's why you need the currency reforms to make durable long lasting goods have value again. You can't simply increase everyones take home pay because that just doesn't work. Instead you can lower the cost of goods domestically so that a similar quality of life can be maintained at a lower income (ending repeat purchases and instead just purchasing something once) while also creating a large international demand for products which would be superior to make up the difference.


Once you open credit to cash exchanges based on market value you basically have the same thing as cash. How do you plan on lowering the supply of credits? If you keep handing them out 500 every month eventually your 500 credit subsidy will be worthless in a couple years. Why not just hand out the subsidy in cash? You also have to consider since the supply of commodities varies the commodities to cash to credits trade will impact the value of credits.


It's not the same thing as cash because you would need a fixed number to buy something. You could pay cash to buy more credits from someone that's willing to sell theirs (such as someone who earns a low wage and wants to pay rent... this would now be directly supported by a desire of the rich to own a new yacht), but there's still a distinction. There would be no inflation because the amount created each month would equal the amount sold. With 310,000,000 people that's 1.5 trillion in credits in the market, if during the month 930 billion credits were spent (this is pretty easy to track), then each person would end up with an additional 300c in the followig month.

If you hand out cash (dollars I assume), you inflate the prices of goods very quickly and crash your economy. Not so with a currency that always exists in a fixed amount and has other protections such as no fractional reserve banking. This allows you the advantages of a planned economy while still having a free market.


How do you distribute the cash money? Is it debt backed money distributed by bank loans? If so than eventually the cash system will hyperinflate to collapse like our current system will.


Why would credits be debt backed? I guess I need an analogy here, or maybe I should go into money in a future post. You could think of these as an improved version of greenbacks if you want. The dual currency idea isn't anything new, during the civil war we had both Greenbacks and Dollars.


If you give enough credits to cover basic needs than a sizable percentage of people wouldn't work. Then you have the scenario where a small percentage of people are working to make enough goods for everybody.


If people aren't working, then the value on the exchange would decline, and they would have to work. Additionally, if people have enough money to meet their basic needs, human nature says they would like to buy luxuries to improve their life, these frequently take the form of physical goods like air conditioners, cars, tv's, computers, tablets, and so on. All things which cost credits, as a result they would save theirs to buy these goods, which means they wouldn't be putting those credits on the exchange to make their rent which still provides an incentive to work.


HanzHenry
Investors.. They are a SCOURGE and the MAIN problem.


Investing has some legitimate value, where you usually run into a problem is when someone shorts a market. These are activities a 1% tax actively prevents (lots of rapid low yield transactions that create a pump and dump effect of a stock), while it still allows for people to grow their money and provide for retirement or have some assets.
edit on 14-1-2014 by Aazadan because: (no reason given)



posted on Jan, 14 2014 @ 11:25 PM
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I would prefer to see a major change in taxes. I would eliminate the income tax and instead tax only accumulated wealth. Tax would not start until the $1 million mark. It would start low(1%) and raise proportionally at different levels of wealth, with billionaires paying somewhere from 5-7% of their wealth on an annual basis. We are currently in a situation where almost every dollar our government prints get sucked into that black hole of wealth. Once it enters it never escapes. This makes these dollars unattainable and creates huge problems in the world's economies. Once wealth becomes a negative factor on the economies it needs to be curtailed. Part of the responsibility of government is to protect us and this is one way they could. Of course they would need full cooperation of the international financial community to make it work. Even with such a tax, most people subject to it would still see their wealth rise very year, just not so much. how much more do you need when you already have more than you can ever spend?

With freedom from income tax we could start working and afford to start fixing social security and healthcare. First set up social security so it becomes fully funded on an actuarial basis. This would probably require an additional 1 or 2% tax. Then set up a socialized healthcare program. Initiate a healthcare tax of 5% which everyone pays. That would entitle one to limited services. If you wanted a more traditional plan you would need to pay an additional premium. No one would be forced to pay this additional premium and if they desired they could have a portion their 5% tax applied towards a private healthcare plan instead.

With the tax base now covered we could fully reform the financial system. Eliminate the central bank and fractional reserve banking and then watch as the money flows to main street.

Employment? We need a one time reset raising wages to sustenance levels with a 30 hour work week. That probably would entail about a 50% jump in the real working wage. A one time reset of prices of 20% would likely cover that, thus still producing the targeted living standard increases. Might have to eliminate certain forms of automation to reach full employment as well. Everyone would be guaranteed this living wage, but you must be willing to work at suitable employment.



posted on Jan, 14 2014 @ 11:33 PM
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reply to post by Aazadan
 


I had to stop reading when I saw you say "we're witnessing the failure of capitalism". We are very obviously witnessing is the result of the total death of capitalism in the U.S. and the golden age of European-style socialism, which is better described as fascism. Hitler won, and you did too since you seem to support a mixed economy.

There were 80,000 pages of business regulations passed in the past year by various government czars with little input from congress. I don't know how many pages there are total but I imagine you laughably call 2 million pages of business regulations "capitalism". Oh wow I really did laugh out loud there. If you think 2 million pages of business regulations are capitalism then what would a mixed economy be? 20 million pages under your dream mixed economy? And then communism I guess would be 100 million pages. Of course ignorance of the law is no excuse so you'd better know all of them.

I'm sorry but the FCC auctioning off bandwidth to the highest bidder for a minimum bid of $1.6 billion is not "capitalism". Its the worst system you can have... a bizarre twist on communism where the the government controls the means of production by giving all their money to the wealthy elite. Not remotely close to capitalism even a little bit.

Capitalism is simply a private person owning the means of production. That is something that does not happen today in the United States. The United States claims ownership over 100% of all the land. If you are not sure about that then ask someone at random if their house is on U.S. territory. So the U.S. government owns 100% of the key means of production... the land. You rent from your overlords each year when you pay your property tax, and if you stop paying you get evicted from their land that they own.

The only two places in the world remotely close to capitalism are Hong Kong and Singapore. The United States has spent the past ten years sliding into the opposite of capitalism. Wouldn't it make more sense to say something like: "gee, over the past 10 years while capitalism has been decreasing, the economy has been going to hell... is that a coincidence?"

What happens under capitalism is that small business reigns supreme. Big business only happens under big government. This is a proven fact, as you can see by looking at a chart of government size and comparing that with the chart of business size. I won't bother actually pulling the data because I'm that confident that I'm right and I'm sure you won't bother looking at it because you don't really care if you're right. You have your holy war to wage against captialism, and I understand that. The truth hurts, so bury you're head in the sand with the 90%.



posted on Jan, 15 2014 @ 12:53 AM
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fractal2
reply to post by Aazadan
 


I had to stop reading when I saw you say "we're witnessing the failure of capitalism". We are very obviously witnessing is the result of the total death of capitalism in the U.S. and the golden age of European-style socialism, which is better described as fascism. Hitler won, and you did too since you seem to support a mixed economy.

... more, cut for space


Before you can improve on the current system you have to look at it's failings, you also have to embrace where each system has had a positive impact. I believe I did that in my post though I didn't expressly point each one out, I suppose I should have since I knew posts like this were going to happen.

In capitalism there is private ownership over the lines of production, this is both its strength and its weakness. What you get is a system driven by self interest which rewards innovation and finding new ways to do things. However in order to maximize ones self benefit you quickly reach a point where you realize that the type of capitalism Henry Ford practiced (highest quality good, highest wage, at the lowest cost) isn't the optimal way to do things. Instead it's better to create products of a short-moderate lifespan so that they have to be purchased over and over, this results in the highest profit. This is the inherent flaw in capitalism, it leads to lower quality goods. You can contrast this with communism which created the highest quality goods out of necessity, the communist supply lines were so poor due to no incentive to work hard that they had to prioritize reuse and design efficiency. This is why they created things like refrigerators that could last for 50 years compared to the 10 year average in the west.

Business regulations are not an aspect of capitalism, but rather an aspect of free markets. There are three types of economies, a market economy, a planned economy, and a mixed economy. In the interest of space I'm going to just give you the summaries from wikipedia:
Market economy: A market economy is an economy in which decisions regarding investment, production and distribution are based on supply and demand, and prices of goods and services are determined in a free price system. The major defining characteristic of a market economy is that decisions on investment and the allocation of producer goods are mainly made through markets

Planned economy: A planned economy is an economic system in which decisions regarding production and investment are embodied in a plan formulated by a central authority, usually by a public body such as a government agency. Although a planned economy may be based on either centralized or decentralized forms of economic planning, it usually refers to a centrally planned economy. Central planning aims to improve productivity and coordination by enabling planners to take advantage of better information achieved through the consolidation of economic resources when making decisions regarding investment and the allocation of economic inputs.

Mixed economy: Mixed economy is an economic system in which both the private sector and state direct the economy, reflecting characteristics of both market economies and planned economies. Most mixed economies can be described as market economies with strong regulatory oversight, and many mixed economies feature a variety of government-run enterprises and governmental provision of public goods.

We probably both agree right now that due to business regulations we are not in a market economy, you seem to hold this as the ideal, although I'm not entirely sure why. Lets figure out what type of economy we're actually in. In a planned economy production and investment is directed by a central authority. If you start going into conspiracy you can make an argument that this is what we're secretly in due to things like the Bilderbergs and CFR, but overtly this isn't what we're doing. So then we get to a mixed economy, we have a private sector reacting to the markets while the government is able to boost or hinder certain sectors through subsidies and taxes, and has regulatory oversight. That sounds a lot like what we're currently in.

Our economy does have some aspects of capitalism but it's not pure capitalism because as you said, in pure capitalism you have a lot of competition and most business is small business. What we have is much closer to a feudal capitalist system where we are the serfs that the corporation we work for is the lord and the government that regulates them being the king.

In the proposed system one can take advantage of a mixed economy much better than we can now, while actually returning the means of production back to the people.

As for the idea of the economy getting worse for the past 10 years, it has been on a steady decline since about 1980. We had a couple of booms in there which make things look good, but once you start comparing purchasing power you quickly notice that things have not been nearly as good as claimed.


sligtlyskeptical
I would prefer to see a major change in taxes. I would eliminate the income tax and instead tax only accumulated wealth. Tax would not start until the $1 million mark. It would start low(1%) and raise proportionally at different levels of wealth, with billionaires paying somewhere from 5-7% of their wealth on an annual basis. We are currently in a situation where almost every dollar our government prints get sucked into that black hole of wealth. Once it enters it never escapes. This makes these dollars unattainable and creates huge problems in the world's economies. Once wealth becomes a negative factor on the economies it needs to be curtailed. Part of the responsibility of government is to protect us and this is one way they could. Of course they would need full cooperation of the international financial community to make it work. Even with such a tax, most people subject to it would still see their wealth rise very year, just not so much. how much more do you need when you already have more than you can ever spend?

...


A tax change alone won't change anything (btw you would need much higher taxes than what you proposed). Part of what my system does, is it creates a large expense for someone who wants to spend their wealth on always having the latest and greatest things as the idea behind trickle down claims is the case. In order to acquire things quickly, it becomes more expensive which requires some of the hoarded money to reenter circulation by buying credits from people. Furthermore, that money goes to people who need dollars the most (presumably, since they're selling credits), which means that money is much more likely to be spent on goods such as food and rent, causing multiplier effects throughout the economy.

Health care, education, and so on are covered in my tax solution. Infact it's probably too high of a tax at the proposed rate since it results in far too much money. The reason this works is because the tax base becomes broadened. We're not just taxing our citizens but rather anyone in the world who seeks to profit off of the US. Unlike typical plans to broaden the tax base which usually go after the bottom 50% who don't collectively have the money to impact revenues regardless of the rate they're paying, this goes after those who do have the revenue, and who do use US markets in order to amass wealth.



posted on Jan, 15 2014 @ 02:20 AM
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If you haven't noticed by now, the "elite" or "tptb" don't like to share. That's why they give "the people" Just Over Broke!



posted on Jan, 16 2014 @ 09:06 PM
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reply to post by Aazadan
 


I don't think our economic problem is so much our ability to produce, but inequitable distribution of goods and services.

A big part of this is manipulation of foreign currency. Throw in trade treaties that work completely in favor of International corporations, and immigration policies that undermine the rights of first world citizens.

I agree, we should lower the work week to somewhere below 30 hours a week. I think prices will adjust to changes in income.

I agree, we are seeing the failure of capitalism.

The thing is, I don't see capitalism, and market economics, as one and the same. Capitalism is a form of market economics, with components that mimic both communism and socialism. If anything, efforts to create a free market has resulted in a capitalistic system that is closer to communism (in its true form) than market economics.

A market economy is based on the exchange of goods and services, where price is set by the law of supply and demand. The idea is that the law of supply and demand established competition, which creates economic efficiency.

The key factor that the proponents of "free market' ideology ignore, is that a competitive market system can not exist without a governing body to prevent criminal enterprise from controlling the exchange of goods and services, and preventing true competition that is critical to the success of the system. Without an evenly enforced fair set of rules, a market economy can not function.

Capitalism doesn't care about the law of supply and demand. It only concerns itself with private ownership of the means of production and control of the markets. In a pure capitalistic system, private ownership controls everything, it is both fascism and communism at the same time.

If we eliminated most public debt, which was mainly created through fraudulent means, prices would drop proportionally. This would be the easiest way to reset the economy. The working class would survive this economic correction easily, because in this day and age, few own any debt instruments/assets. A lot of retirees would suddenly be hurting, but most of them have considerable other assets to fall back on.

I think we need to create international consumer, labor, and environmental protection rights and standards. The reason for not enforcing standards around the planet was to give third world economies a chance to build, but what we have seen is abuses that have not only kept third world countries from building solid economies, but have dragged down first world economies. We set these international standards, then we can eliminate tariffs.


edit on 16-1-2014 by poet1b because: change a word.



posted on Jan, 16 2014 @ 09:19 PM
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reply to post by Aazadan
 


I think we need to separate the Fed res currency, and create a true US currency.

Let the international corporations support their own currency. Goods and services in the U.S., would be purchased only by a true U.S. Currency. Purchase of imports would be through a currency exchange.

U.S. property could only be owned by US citizens, not by international corporations or investment funds. This would drive the price of property in the US back to where it should be.


edit on 16-1-2014 by poet1b because: correct first sentence.



posted on Jan, 19 2014 @ 05:50 PM
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poet1b
reply to post by Aazadan
 


I don't think our economic problem is so much our ability to produce, but inequitable distribution of goods and services.

A big part of this is manipulation of foreign currency. Throw in trade treaties that work completely in favor of International corporations, and immigration policies that undermine the rights of first world citizens.


Trade imbalance isn't really a factor because we get something out of it. With an imbalance we send more dollars to a country than they send back to us, however they then turn around and use that profit to buy things like fighter jets, ships, and so on from the US for several billion dollars. In the end it feeds the money right back into our military-industrial machine, and in exchange we get political leverage in order to keep the arms deals flowing. We then use that leverage in order to get favorable deals for our corporations. The so called loss actually works out to be a net gain. This is why we maintain a trade deficit despite having the far stronger negotiating position.


The thing is, I don't see capitalism, and market economics, as one and the same. Capitalism is a form of market economics, with components that mimic both communism and socialism. If anything, efforts to create a free market has resulted in a capitalistic system that is closer to communism (in its true form) than market economics.


Capitalism and the free market aren't the same. Capitalism seeks to generate individual profit while a free market seeks to use supply and demand to balance everything.

A free market is unsustainable because as some firms win the various competition battles, other firms lose and disappear. Over time you have fewer and fewer firms eventually culminating in monopolies, first of certain sectors and then of everything. There must be a regulatory body in order to keep markets mostly free.

Capitalism is unsustainable in a different sense. Just like in communism human psychology works against the system but it does so in a different way. In capitalism the best way to profit eventually becomes many frequent small to medium sized purchases for the same good rather than a 1 time large purchase. The end result is that goods eventually become more expensive as you have to pump a lot of money into their upkeep. For example I've bought a few blenders in stores over the past few years, each works for 6-9 months and then I have to get a new one. One good blender prior to this system would have cost about $75 in todays dollars however the option now is a bunch of $20 ones. After two years I've paid more, and after several years I've paid way more. Under capitalism goods are not built to last. I don't want to get too far into the environmental side of things but this is very bad for our environment. It burns through a ridiculous number of resources and this waste has to go somewhere. Additionally, we end up with less stuff as the repeat purchases are just a sneaky way of increasing prices. This also leads to more work hours being needed to supply everyone with their goods.

The problem is, under both a free or mostly free economy and capitalism, there's no economic incentive in building products to last. Most buys are short term, some being impulse buys. Consumers don't purchase an item thinking of the cost 5-10 years from now and as such we can't make rational choices when buying items. The only way to fix this is an economic system that creates a tangible incentive in buying quality products which is what my proposed system does.


If we eliminated most public debt, which was mainly created through fraudulent means, prices would drop proportionally. This would be the easiest way to reset the economy. The working class would survive this economic correction easily, because in this day and age, few own any debt instruments/assets. A lot of retirees would suddenly be hurting, but most of them have considerable other assets to fall back on.


Public debt has little to no impact on anything with regards to prices. Debt exists on two levels, on a national level debt is a reflection of faith in the country/currency. Because we've turned debt into an asset, a foreign entity holding a large portion of our debt reflects their faith in our currency. They then use that debt to back their own currency. This does two things, first it allows for an expansion of the M2 money supply through credit. Second it creates a system of economic interdependence that prevents wars. MAD worked when there were just two nations but now theres several nations in the nuclear club all with different agendas. MAD still exists as a failsafe to prevent the largest possible wars, but debt is actually used to prevent the smaller ones. It's a system that works very well.


I think we need to create international consumer, labor, and environmental protection rights and standards. The reason for not enforcing standards around the planet was to give third world economies a chance to build, but what we have seen is abuses that have not only kept third world countries from building solid economies, but have dragged down first world economies. We set these international standards, then we can eliminate tariffs.


International anything is very complicated and largely toothless unless it's a treaty between certain countries. Just look at the jokes known as the world court and international law if you don't believe me. Even including regulations in trade treaties is very difficult because it puts nations at a major disadvantage. This is China's main argument with carbon regulations. They say it's not fair that the west was able to use dirty polluting technologies to advance, but now we're saying China must use cleaner expensive technologies that they can't afford. They see it as an attempt to keep them from developing, and whether there's any truth to that or not they're right that it's not fair. They have the right to improve the lives of their people even if it's through millions of coal plants. It's a stage every other developed nation has gone through.

The only way to really make lasting reforms here is to either find better ways to do things, and give that technology to everyone for free (something which goes against any economic system), or to completely overturn the flawed concept of sovereignty which I can promise would only happen through world domination.


poet1b
reply to post by Aazadan
 


I think we need to separate the Fed res currency, and create a true US currency.

Let the international corporations support their own currency. Goods and services in the U.S., would be purchased only by a true U.S. Currency. Purchase of imports would be through a currency exchange.

U.S. property could only be owned by US citizens, not by international corporations or investment funds. This would drive the price of property in the US back to where it should be.


edit on 16-1-2014 by poet1b because: correct first sentence.


My system actually does this to an extent. There would be the federal reserve currency and official currency which would be controlled by a central bank. However there would then be a secondary currency free from the influence of banks. It's the best of both worlds actually because you get the positives of banking (of which there are a few) while also significantly limiting the negatives.



posted on Jan, 19 2014 @ 05:56 PM
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reply to post by Aazadan
 


S&F

For sheer effort.



posted on Feb, 16 2015 @ 05:43 AM
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originally posted by: sligtlyskeptical
We are currently in a situation where almost every dollar our government prints get sucked into that black hole of wealth. Once it enters it never escapes. This makes these dollars unattainable and creates huge problems in the world's economies.


Well, there's another factor when it does come out of the black hole and it is called charity... charity is tax deductible, so when someone gives several million to build a library or hospital wing for self aggrandized publicity... I'm unimpressed, because if they write that charity off, they basically just forced tax payers to build the library or new hospital wing they are slapping their name on and taking credit for.




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