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The Economy Got Off to a Historically Bad Start in 2014

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Re: The Economy Got Off to a Historically Bad Start in 2014

#71

Post by kaonashi »

nostromo wrote: post #7
jacobolus wrote: post #3

Earlier quoted context omitted.

Just sending checks to all citizens is politically difficult, because it starts conversations about “class warfare” and “socialism”, and implies that the federal government should have a policy of explicit wealth redistribution, rather than the current hodge-podge of means tested welfare programs and monetary policy tools. But to answer your question: yes, we’d increase liquidity, reduce unemployment and dramatically…

Let's put aside the Federal Government (and taxes and spending) for a moment and focus on the Federal Reserve. The Federal Reserve printed a large amount of money in response to the crisis. (That was a silent tax on anyone holding cash.) To inject this money into the economy, they bought a bunch of securities. My question is simply: why use asset buying as a vehicle for injecting money into the economy and not cash t…

> (That was a silent tax on anyone holding cash.)

Not really, because...

> To inject this money into the economy, they bought a bunch of securities.

Trading one financial asset for another is not the same thing as handing out cash for nothing.

Unless you want to make the case that a torrent of spending was being frustrated by being stuck in illiquid assets (and has subsequently materialized but has not been reflected in official statistics).

Re: The Economy Got Off to a Historically Bad Start in 2014

#72

Post by arg01 »

jqm wrote: post #64
mikeyouse wrote: post #51

Earlier quoted context omitted.

Payroll taxes are nothing like slavery. You do yourself no favors with such ridiculous comparisons.

I didn't say "payroll taxes are LIKE slavery" (which would be a comparison). I said "payroll taxes are a FORM" of slavery. (along with being a form of theft). Just because we have been doing it and you are used to it doesn't negate this. If one WERE to compare payroll taxes and slavery, I would say the common element is involuntary appropriation of the fruits of labor. So they are not "nothing" alike. They do share a…

I'd point out that your definition of slavery is just as applicable to any work were the person being employed needs to work to get the basics of survival (with corresponding parallels between changing jobs and changing countries, choosing not to eat and choosing not to work for income above the tax free limit, etc).

The only reason I point this out is because while there are plenty of rational arguments for different forms of tax (including whether or not income scales to labour and whether this means a tax on income (especially a tiered one) is actually comparable to a tax on labour) however comparing it to slavery is not productive as it re-frames the conversation to an area of extremes where quite reasonable tax systemss become either no slavery or everyone's a slave. Much like calling the other person either a libertarian if you believe "any type of free market is ok" or a communist if you believe "any taxation is ok" would not be productive.

Re: The Economy Got Off to a Historically Bad Start in 2014

#73

Post by ChuckMcM »

mikeyouse wrote: post #45
ChuckMcM wrote: post #37

Earlier quoted context omitted.

Apropos of nothing, and since you mentioned it, a surprising number of things are at least twice as expensive now as they were in 2004. Nearly all produce products, gas, houses, rents, cars, and clothes. Beer, wine, and soda seem a bit less impacted. If you want you can play this game yourself by looking at archived newspapers in Google's newspaper archive ( http://news.google.com/newspapers ) from 2004 and them comp…

Houses / rents are twice as expensive from 2009? Maybe in the Bay Area, but the rest of the country strongly disagrees; The 20-City Case Shiller is up 4.5% total since June 2004 ( http://research.stlouisfed.org/fred2/graph/fredgraph.png?g=E... ). Clothing is up 5% total since June 2004 ( http://research.stlouisfed.org/fred2/graph/fredgraph.png?g=E... ). We don't need Google's newspapers since this stuff is meticulous…

That would be a much more interesting set of graphs if the Fed would let you in on how they compute the index.

That is why looking at newspaper advertisements are actually pretty cool. They don't use, Detroit for example, when computing the cost of suburban housing.

Here is an example, I don't know if will work for you. Marysville Washington, a quiet little town, the paper has a 2004 edition online [1] and on page 21 of 26 are the rental listings. 2 Bedroom, 1.5 bath apartments are about $500. If you look at 'forrent'[2] a rental search service for Marysville, two bedroom 1.5 bath apartments today are closer to $1,000 a month. It may not be exactly 100% and its hard to pin it to an exact unit (would be interesting if you found the same unit in a newspaper and online) but not taking the Fed's word for it, and actually looking at papers that were published back then which is key in my opinion, shows a much higher increase in costs than the Fed reports as having occurred. That is why I wonder how they compute their indexes (but the last time I dug into it they claimed secrecy so that people wouldn't try to 'game' them.)

Not trying to argue, just getting a different result when I go to the primary sources.

[1] http://news.google.com/newspapers?nid=ovGv7akYl-cC&dat=20040...

[2] http://www.forrent.com/results.php?page_type_id=refine&searc...

Re: The Economy Got Off to a Historically Bad Start in 2014

#74

Post by arg01 »

iammyIP wrote: post #32
oldmanjay wrote: post #11

Earlier quoted context omitted.

What I like about wealth redistribution scenarios is how they're so much easier to sell when you ignore the potential negative effects.

What potential negative effects would that be?

Depends on the type of redistribution. It's not hard to imagine inflation as an effect for a lot of them (though the inflation could have a net positive effect depending on the redistribution scheme). At the very least people may quit horrible jobs for low pay if they can feed themselves without doing them (you can at least nominally call that bad from one point of view).

Re: The Economy Got Off to a Historically Bad Start in 2014

#75

Post by mikeyouse »

ChuckMcM wrote: post #73
mikeyouse wrote: post #45

Earlier quoted context omitted.

Houses / rents are twice as expensive from 2009? Maybe in the Bay Area, but the rest of the country strongly disagrees; The 20-City Case Shiller is up 4.5% total since June 2004 ( http://research.stlouisfed.org/fred2/graph/fredgraph.png?g=E... ). Clothing is up 5% total since June 2004 ( http://research.stlouisfed.org/fred2/graph/fredgraph.png?g=E... ). We don't need Google's newspapers since this stuff is meticulous…

That would be a much more interesting set of graphs if the Fed would let you in on how they compute the index. That is why looking at newspaper advertisements are actually pretty cool. They don't use, Detroit for example, when computing the cost of suburban housing. Here is an example, I don't know if will work for you. Marysville Washington, a quiet little town, the paper has a 2004 edition online [1] and on page 21…

You're essentially arguing that anecdotal data is more useful than aggregate data. I don't share that belief.

> That would be a much more interesting set of graphs if the Fed would let you in on how they compute the index.

The Fed doesn't collect either of the data series I linked either, FRED is just a useful tool for displaying various different indices.

Here's a 40-page PDF detailing the Case-Shiller Methodology:

http://us.spindices.com/documents/methodologies/methodology-...

Here's a 110-page PDF detailing the BLS's full CPI methodology:

http://stats.bls.gov/opub/hom/pdf/homch17.pdf

With a 20-page PDF addendum specifically detailing the Hedonic adjustment methodology for apparel:

http://www.unece.org/fileadmin/DAM/stats/documents/ces/ac.49...

Re: The Economy Got Off to a Historically Bad Start in 2014

#76

Post by jqm »

arg01 wrote: post #72
jqm wrote: post #64

Earlier quoted context omitted.

I didn't say "payroll taxes are LIKE slavery" (which would be a comparison). I said "payroll taxes are a FORM" of slavery. (along with being a form of theft). Just because we have been doing it and you are used to it doesn't negate this. If one WERE to compare payroll taxes and slavery, I would say the common element is involuntary appropriation of the fruits of labor. So they are not "nothing" alike. They do share a…

I'd point out that your definition of slavery is just as applicable to any work were the person being employed needs to work to get the basics of survival (with corresponding parallels between changing jobs and changing countries, choosing not to eat and choosing not to work for income above the tax free limit, etc). The only reason I point this out is because while there are plenty of rational arguments for differen…

Very simply, involuntarily appropriated the results of someone's labor is a form of slavery. In this case, one is being caused to labor for the benefit of the state.

Pointing out the essence of the practice isn't extreme. And just because it is customary doesn't change the essence.

I don't think this is a productive nor a just, way to fund society. The government doesn't (or shouldn't) own us. So I disagree very strongly that this is a "reasonable" basis for taxation just as I disagree keeping some people as property is "reasonable" because it is maybe customary.

These "reasonable" and "extremist" type arguments are simply support of custom and status quo and could have just as easily been leveled at abolitionists 200 years ago (and almost certainly were).

But thanks for your feedback. I appreciate it. This topic is actually very important to me and I feel quite strongly about it and intend to write more in detail about it, so hearing people's perception helps. And for the record I am not opposed to taxation. I am opposed to taxation specifically on labor and innovation. I don't think the government (or society) has any moral claim on those. I think they have a very strong moral claim on resources and these should be the basis for taxation.

Re: The Economy Got Off to a Historically Bad Start in 2014

#77

Post by TheCoelacanth »

mikeyouse wrote: post #51
jqm wrote: post #44

Earlier quoted context omitted.

"The idea of taxing the socially beneficial act of working and hiring workers is pretty repugnant anyway." HEAR! HEAR! Payroll taxes are essentially a form of slavery. Every week you work X number of hours for the government. Almost like you were hauling pyramind blocks under a whip. And, on this point, conservatives (who are often wrong) are exactly right. Taxing innovation and labor are hardly incentives to provide…

Payroll taxes are nothing like slavery. You do yourself no favors with such ridiculous comparisons.

I agree. Cut out that line and it's a much more persuasive comment.

Re: The Economy Got Off to a Historically Bad Start in 2014

#78

Post by todd8 »

mikeyouse wrote: post #61
Paul_Dessert wrote: post #30

The chart in the articles below paints the picture. I've never really been overly involved in economics up until last year. When I started reading and exploring I was shocked at what I found. I kept struggling, because I knew something wasn't right, I just couldn't put my finger on it. I still can't. All indicators that I can find show the economy slipping into another recession (or simply continuing the previously i…

I sincerely hope Zerohedge isn't your source for economics information, they are desperately alarmist and wrong nearly constantly. The source of your unease might just be your source of news. The world isn't falling apart, there is no 'great lie', poor homebuyers in Topeka aren't to blame for the GFC, and you shouldn't be stockpiling bullets and gold. The world entered a debt-driven recession and we're still climbing…

Those numbers do brighten my outlook, but while our economy has added 9 million more workers our population has grown by almost 12 million.

Isn't it appropriate to be looking at the employment-population ratios instead of the number of workers? This chart (of the employment-population ratio) doesn't paint such a rosy picture:

http://data.bls.gov/timeseries/LNS12300000

Re: The Economy Got Off to a Historically Bad Start in 2014

#79

Post by mikeyouse »

todd8 wrote: post #78
mikeyouse wrote: post #61

Earlier quoted context omitted.

I sincerely hope Zerohedge isn't your source for economics information, they are desperately alarmist and wrong nearly constantly. The source of your unease might just be your source of news. The world isn't falling apart, there is no 'great lie', poor homebuyers in Topeka aren't to blame for the GFC, and you shouldn't be stockpiling bullets and gold. The world entered a debt-driven recession and we're still climbing…

Those numbers do brighten my outlook, but while our economy has added 9 million more workers our population has grown by almost 12 million. Isn't it appropriate to be looking at the employment-population ratios instead of the number of workers? This chart (of the employment-population ratio) doesn't paint such a rosy picture: http://data.bls.gov/timeseries/LNS12300000

Of course population matters, but as more people are attending college (https://www.nacs.org/research/industrystatistics/higheredfac...) and as the baby boomers retire (http://www.ssa.gov/oact/progdata/icpGraph.html), the employment ratio would naturally decrease.

I like U4 as a good measure of unemployment since it also includes discouraged workers who gave up looking for jobs:

http://research.stlouisfed.org/fred2/graph/?g=Ehe

Obviously not a completely healthy economy, but a rate that's dropped 40% from the peak of the recession, and is back to levels comparable to 2003/2004 is a good start.

Re: The Economy Got Off to a Historically Bad Start in 2014

#80

Post by mikeyouse »

jqm wrote: post #76
arg01 wrote: post #72

Earlier quoted context omitted.

I'd point out that your definition of slavery is just as applicable to any work were the person being employed needs to work to get the basics of survival (with corresponding parallels between changing jobs and changing countries, choosing not to eat and choosing not to work for income above the tax free limit, etc). The only reason I point this out is because while there are plenty of rational arguments for differen…

Very simply, involuntarily appropriated the results of someone's labor is a form of slavery. In this case, one is being caused to labor for the benefit of the state. Pointing out the essence of the practice isn't extreme. And just because it is customary doesn't change the essence. I don't think this is a productive nor a just, way to fund society. The government doesn't (or shouldn't) own us. So I disagree very stro…

> But thanks for your feedback. I appreciate it. This topic is actually very important to me and I feel quite strongly about it and intend to write more in detail about it, so hearing people's perception helps

I can add some more color.

I find it interesting because I largely agree with your stance on taxation, but could not disagree more strongly about the comparison to slavery.

My first reaction is entirely visceral, "This is an obscene and offensive comparison."

After some less reactionary thought, it still sounds ridiculous. You can't choose to stop being a slave. At any point, you can choose to stop paying taxes (either illegally or by ceasing to earn income). If you had adequate resources, you could live off of the land entirely on your own and keep all of the fruits of your labor.

At many lower incomes, there is no income tax bill due whatsoever. So you're saying the government is enslaving the wealthy to a greater extent than the poor? And you honestly think that? The government represents the will of the people, via democratic action, we set our own tax rates. So the 'people' are enslaving themselves? I don't think that makes any logical sense whatsoever.

Call income tax 'theft' if you must (a comparison I still disagree with) but slavery doesn't hold up and distracts the conversation.

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