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Dear 22 Year Old: Concerning your economic Future

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Re: Dear 22 Year Old: Concerning your economic Future

#31

Post by ataggart »

jballanc wrote: post #17

There is a word for this sort of viewpoint: Luddite fallacy ( http://en.wikipedia.org/wiki/Luddite_fallacy ) It amazes me how people fail to see their own Luddite-ism. Look, here's the deal: The Luddites protested the mechanization of the textile industry during the industrial revolution. Their reasoning was that if one person maintaining one machine could do the same work as 100 individual laborers, then that would…

"This sort of viewpoint" is fundamentally different from the luddite fallacy. The crux of the fallacy is misapprehending the results of productive increase, thus mistaking a Good Thing for a Bad Thing. That's not what's going on in the article (unless you have a very different perspective on intergenerational debt).

Now it is certainly true that we'll be in less trouble if the economy grows faster than the hole being dug, but a hole is still being dug. If things improve it would be in spite of, not because of, the indebtedness being incurred. Again, the luddite fallacy is not applicable.

It is also certainly true (and proven over the centuries) that investment of capital accumulated through deferred consumption can, when applied toward improvements in technology, yield productivity gains, thereby improving the balance sheet of the inventor and the living standards of the common man. Such gains will emerge from the market, revealing what works and what doesn't, and in not working will free that capital to be put to more productive ends. It's not at all clear to me that a debt-funded, politically-allocated system will yield better outcomes.

Re: Dear 22 Year Old: Concerning your economic Future

#32

Post by stretchwithme »

jballanc wrote: post #17

There is a word for this sort of viewpoint: Luddite fallacy ( http://en.wikipedia.org/wiki/Luddite_fallacy ) It amazes me how people fail to see their own Luddite-ism. Look, here's the deal: The Luddites protested the mechanization of the textile industry during the industrial revolution. Their reasoning was that if one person maintaining one machine could do the same work as 100 individual laborers, then that would…

I don't think public spending on research is the ultimate determinant of a nation's technological edge.

After all, it was not government research that gave us the ability to manufacture Germany into submission. That came from people like Henry Ford. Even the airplane came from a private endeavor, while a government effort failed to get off the ground.

And if you look to the decline of the last great empire, Great Britain, in came in the wake of an expansion of the public sector. New technologies developed by government funding did not save the day.

Re: Dear 22 Year Old: Concerning your economic Future

#33

Post by thomas11 »

jballanc wrote: post #17

There is a word for this sort of viewpoint: Luddite fallacy ( http://en.wikipedia.org/wiki/Luddite_fallacy ) It amazes me how people fail to see their own Luddite-ism. Look, here's the deal: The Luddites protested the mechanization of the textile industry during the industrial revolution. Their reasoning was that if one person maintaining one machine could do the same work as 100 individual laborers, then that would…

But how does digging up dinosaur bones in China contribute to technological advancement or productivity increases? Mind you, I'm all for science, but there are certain kinds of science that could be put on the back burner for a while in a financially tight situation.

Re: Dear 22 Year Old: Concerning your economic Future

#34

Post by rflrob »

jsz0 wrote: post #26
ianisborn wrote: post #4

Being a 22 year old myself, I'm grateful that nothing in here is surprising to me and that my parents made me start a savings account when I was young (like 10 or something). To be honest, I don't think I've met anyone from my generation who expects to see money from social security when they retire.

Social Security is good till 2040 at minimum. Some modest adjustments can extend it even further and more radical changes gets it to the 22nd century. All of this is possible without even touching the ~50% of the budget that goes towards military spending or raising payroll taxes significantly. My personal opinion is we shouldn't even consider cutting a single social safety net until military spending has been slashe…

From your tone, it sounds like youre critical of the original article, but Social Security collapsing in 2040 means, for anyone in their 20s, that they wont see a payout. What was proposed in the article was, to my twenty something view, "modest adjustments".

Re: Dear 22 Year Old: Concerning your economic Future

#35

Post by anigbrowl »

Most prognostications about social security seem to be predicated on a closed demographic system, and take no account of immigration's impact on the ratio of taxpaying workers to retirees. Now would be a sensible time to come to grips with this question, but of course in a time of high unemployment and electoral angst, it's politically radioactive.

This is the best analysis of the issue that I've come across, and well worth the reading time: http://www.ssab.gov/documents/IMMIG_Issue_Brief_Final_Versio...

Re: Dear 22 Year Old: Concerning your economic Future

#36

Post by rflrob »

thomas11 wrote: post #33
jballanc wrote: post #17

There is a word for this sort of viewpoint: Luddite fallacy ( http://en.wikipedia.org/wiki/Luddite_fallacy ) It amazes me how people fail to see their own Luddite-ism. Look, here's the deal: The Luddites protested the mechanization of the textile industry during the industrial revolution. Their reasoning was that if one person maintaining one machine could do the same work as 100 individual laborers, then that would…

But how does digging up dinosaur bones in China contribute to technological advancement or productivity increases? Mind you, I'm all for science, but there are certain kinds of science that could be put on the back burner for a while in a financially tight situation.

Nobody knows whether it will or not---the most revolutionary discoveries tend to come from unexpected places. As far as I'm concerned, an atmosphere where science has to justify itself as practical is just asking for all the really revolutionary discoveries to be made elsewhere.

Conflict of interest statement: I am a pure science graduate student, so take my opinions on science funding with an aliquot of NaCl.

Re: Dear 22 Year Old: Concerning your economic Future

#37

Post by copper »

thomas11 wrote: post #33
jballanc wrote: post #17

There is a word for this sort of viewpoint: Luddite fallacy ( http://en.wikipedia.org/wiki/Luddite_fallacy ) It amazes me how people fail to see their own Luddite-ism. Look, here's the deal: The Luddites protested the mechanization of the textile industry during the industrial revolution. Their reasoning was that if one person maintaining one machine could do the same work as 100 individual laborers, then that would…

But how does digging up dinosaur bones in China contribute to technological advancement or productivity increases? Mind you, I'm all for science, but there are certain kinds of science that could be put on the back burner for a while in a financially tight situation.

In general, you wouldn't know what a new discovery would contribute to technological advancement or productivity increases :) If you did, it's arguably because the research you're doing is an incremental improvement over something already existing, rather than something entirely new (not that there's anything bad with doing either of those things.)

Putting these kinds of things on the back burner may be a good thing only if you're sure that the money being spent on it will be used for something more necessary/efficient/whatever.

Re: Dear 22 Year Old: Concerning your economic Future

#38

Post by ataggart »

jojopotato wrote: post #14
runT1ME wrote: post #5

Earlier quoted context omitted.

A government mandated Ponzi scheme. Brilliant. :(

I don't quite get why people keep calling Social Security a ponzi scheme. A ponzi scheme is defrauding investors by saying that there has been growth in the assets and it's paying out dividends, SS doesn't make any claim like that. The real problem people are complaining about is the burden that was shared by many (by having lots of kids) is going to be shared by fewer and fewer people.

You're being overly narrow in your definition of a ponzi scheme. It's simply a scheme whereby, for an individual, the amount of money they receive will exceed the money they spend only so long as the ratio of new members to old members exceeds one. It's not a real investment as there is no productivity increase occurring; it's just an accounting game.

And that's precisely how Social Security operates, and precisely why it will run into problems.

Re: Dear 22 Year Old: Concerning your economic Future

#39

Post by lsc »

SlyShy wrote: post #3

As an 18 year old reading this sort of writing makes me want to leave the country. Except that I'd be taxed for ten years after expatriating, and there isn't any country that I know of as being similarly entrepreneurial. If anyone has suggestions, though, I would love to hear them.

If you can, do so. see what it's like. But don't burn your bridges.

If you do find some place better, that's good for you. If you don't? then you'll have a much better appreciation for your birth country.

Re: Dear 22 Year Old: Concerning your economic Future

#40

Post by stretchwithme »

anonymous245 wrote: post #20
SlyShy wrote: post #3

As an 18 year old reading this sort of writing makes me want to leave the country. Except that I'd be taxed for ten years after expatriating, and there isn't any country that I know of as being similarly entrepreneurial. If anyone has suggestions, though, I would love to hear them.

Interesting. Are you sure taxation ends after 10 years?

yeah, after you forfeit your citizenship, the US expects you to keep paying income tax for ten years.
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