Rexanglorum's Economic Manifesto

[rexanglorum]

Warning this is a very long read (by the standards of message board) but I did put in much shorter version at the bottom. If you are interestedin public policy and economics, please read the entire post, you will not regret it. Also, while I do not give homework help this could bailout some of youguys when you have major paper due in the fall semester, if you copy and paste it now. You can thank me six month from now.

Part 1 Introduction

I have found in discussing economic ideas and economic policy with a great many of you that even the smartest and most educated among you guys as well as thepeople, with whom I have spoken in most settings, have little or no nuance, sophistication or desire to be precise when discussing economic policy,particularly the role of government in economic life.

Many people see things in a binary way, either the government should be completely uninvolved and that markets forces should be completely unconstrained andthat there should be little or no forms of government services and redistribution of wealth or income. There is the other side that want government to car forus from cradle to grave and that government should run most enterprises because it will not only be more just but will be more efficient because the market isseen as stupid and unresponsive compared to government planners. There are a great many who are more moderate in there outlook and who wants some welfare andbenevolence programs and some public ownership.

What is key is that people tend to bundle the many types of government intervention in the economy. What is important to realize is that government control orintervention in the economy is not one homogeneous lump that can or should be adjusted to an appropriate level. There are a few major forms of governmentintervention.


Harmful
-It can use classical socialism, which involves government control and/or ownership of the means of production (which also include communications,entertainments, the news media and the financial system) this is also known as central planning.. There is also its more limited cousins subsidies that favorcertain firms or unions as well as quotas and tariffs on imported goods. These two items as well central planning all add up to industrial policy.
-government authorities having ease when it comes to the seizure of private property
-there can be price controls (which includes maximum or minimum rates of interest, wages or rent).
-aggressive monetary policy which will generally disregard stable currency in favor of full employment or keeping the currency friendly to exports

Can Be Helpful Or Harmful
-regulation on what business legally can and cannot do.
-provisioning public goods, which can range from neighborhood parks to providing national defense

Helpful
-various forms of insurance (usually mandatory like social security) or benevolence (programs that aim to move wealth from those with more to those with less)or fluid income supplementing programs which would be either a minimum income or better yet a negative income tax that is on sliding scale instead of beingbased on brackets.
-Providing law and order and an impartial judicial system which defends property rights and allows for redress in the cases of force, fraud or other harms likenegligence or bad externalities (like noise and pollution) being inflicted on another person.

Part 2 "Capitalism" and "Socialism"

When most people argue for or against a form of government intervention, the arguments tends to become arguments about the idea of and the legitimacy or thepros and cons of all government intervention as a whole. In these discussions the pro and anti government side has good points to make and strong examples tocite. It seems odd that certain countries that are "socialist" can have such different standards of living, how is that people in Scandinavia andCanada and Germany have lives that are as good as our own, almost as good and by some measures, better than our own but North Korea is a hell on Earth and theSoviet Union did not produce a much better standard of living nor has Cuba. The same is true of "capitalist" countries, Countries like the US andAustralia have very high standards of living but many countries in Latin America claim to be capitalist but have standard of living that is about the same asthe desperately poor island nation of Cuba.

The reason for the disparity about the "capitalist" and "socialist" nations how weakly applied or more fundamentally, how the blanket terms"Capitalism" and "Socialism" simply are not able to specific the half dozen or so forms of government control of an economy. The list oftypes of government intervention in the economy is arranged so that the most damaging policies are at the top and as the list descends, the policy is lessdamaging and after the first break, the two items that are listed can be helpful and can be harmful and after the second break, I have the list of the twothings government can do that makes life better for its citizens and the final item, of law and order and a dependable system of courts is a must for a countryto have a good standard of living.

Part 3 What Government Does That Works

The countries with a good standard of living almost always provide the law and order and respect for property right that accompany it. This final and mostimportant item on the list is a common trait in all countries with what would be called G7 or First World levels of wealth and productivity. The second to lastitem is seen throughout every First World Country with many of the European nations that are called socialist redistribute wealth and provide a stronger socialsafety net than does the US.

Despite what many conservatives and libertarians say, government forms of insurance (especially with unemployment insurance) and benevolence/redistribution hashad many success stories when judged from a stand point of increasing the level of utility, happiness, among the population. It can cause some distortedincentives and reduce productivity (which is serious matter because productivity closely correlates with standards of living) but because so many people areboth risk averse and unwilling to save enough voluntarily, well run insurance and redistribution and benevolence reduce stress and bring about peace of mindwhich increases happiness.

The only legitimate critiques are that these schemes centers on their process and execution. Programs such as social security end up taking wealth from lowerearners and serving as welfare for the middle class and upper middle class. All welfare programs can be abused and can be costly to police and finally, certainprograms, especially pension programs, are too costly and unsustainable. The key is to execute and build these programs properly and to structure them properlyand unlike central planning, doing so has proven to be quite feasible.

Part 4 What Sometimes Works

The items on the middle of the list have the potential to improve consumer welfare but have also reduced standards of living in a country. Regulations can makelife better for consumers. The best forms of regulation are not the ones that severely limit choices but the regulations that require clear and fulldisclosure. It is very good, on balance, to give consumers a chance to avoid fraud before it happens and to not be swindled by sellers who will take advantageof fine print. Certain minimum safety regulations can be in order because workers may be unaware of difficult to observe workplace risks and consumers, whogenerally should be allowed to buy whatever they want and deny repeat business to the makers of bad products, could get killed or maimed so there would be noway for the normal market mechanism to work in the case of firms making very dangerous products.

Regulations can also be abused and are frequently corrupted to basically block the entry of competition and benefit the producers of a good but increase thecost for consumers. The same dichotomy exists in public goods. Things like public parks, a police force, fire fighters, public infrastructure and a militaryall do useful and sometimes indispensible things but in all cases they tend to be quite costly to provide because of institutional inefficiencies.

Part 5 What Usually Fails

The block of bad items are things that have either never worked or have almost never worked. Monetary policy that seeks to ensure full employment was tried inalmost every industrialized nation after World War II and starting in the 1970's, up through the 1990's those policies were cast a aside in favor ofinflation targeting, monetarism and greatly increased central bank independence, which makes apolitical monetary policy possible (other countries such as NewZealand have other institutional devices such as a statute that will fire everyone who chairs the New Zealand Central Bank if inflation is allowed to riseabove 2% annually). The results have generally been much sounder currency, more stability and less inflation. What is bitterly ironic is that European andother industrialized regions of the world modeled their new, independent central banks on our own Fed and now have central banks that are more much detachedfrom politics, more disciplined, more willing to control inflation and our Fed, whose independence is not nearly as great as many believe, is being pressuredby politicians to inflate, with potentially catastrophic results over the horizon.)

Price controls have always failed to achieve their goal, rent control makes apartments less available and usually less affordable, minimum wage does not helpthe poor, interest rate caps shut down payday lenders and pushes the poor over to loan sharks, who charge even higher interest rates and break legs ascollateral. Government sponsored price floors on agricultural goods make life more costly for all Americas, especially poorer Americans for whom food is abigger part of their budget then it is for others. Price controls on gasoline were tried and it created long line, gas stations that were sold out, verylimited hours at the stations and quasi black market tactics (like over paying for an oil change and getting a "complimentary" tank of gas) or outright bribery and black market selling of gasoline. It is sad to see people making less money than would allow them to live with any comfort or dignity andthat and other social problems that can arise in a free market is to take a tactic from the "good portion of the list and use negative income taxes andother forms of assistance to this person whose skills and level of productivity currently do not allow him enough money to be able to not be homeless and/orsuffer very real and severe material deprivations.

The final item on the list is the triumvirate of public ownership and/or control of the means of production, subsidies and trade restrictions which make up thethree horsemen of poverty, failure and usually tyranny and serfdom. Public ownership of the entire economy or significant parts of it have never failed to makethe people of nations who try worse off every time. It can sometimes kill people, as was the case with famines in the 20th century in the countries wheregovernment took control of the farming. It can turn the nation's leading industry into a drain on the public treasury as was and is the case with petroleumin Mexico, sugar in Cuba, rice in North Korea and coal in Britain. Public ownership, central planning and it inevitable companions of subsidies and severetrade restrictions were practiced nearly everywhere on Earth after the Second World War.

The former colonies in Africa and Asia and Latin America all hoped to catch up with the West by using central economic planning, which claimed to efficientlyuse the nation's resources and supposedly not just create a fairer system but a more productive and wealth enhancing system. The conventional wisdom wasthat markets were too clumsy and short sighted to make investments and improve standards of living over time. Virtually the same perverse logic was used in thecommunist nations, who confidently predicted that it would surpass the US and the West with a decade or so. The West for the most part, also adopted publicownership and central planning as well.

The idea of wanting to create a just society was noble one but centralized government planning failed on that count The notion that central planning couldbetter allocate resources than the price mechanism, was really very foolish. In a world where a simple pencil is made by the price coordinated actions ofmillions of strangers in all corners of the globe, it is simply hubris to believe that one man or a small committee of people, even people with degrees fromMIT or the LSE cannot replicate the level of coordination on the part of those millions of far flung strangers. Central planning and industrial policy is toeconomics what intelligent design is to biology.

Part 6 What This All Means

Our current foray into picking winners and loser, using the treasury to prop up firms and then micro managing them and becoming hostile to the fact thatcapitalism works best when inefficient firms disappear and leaner firms get a bigger market share and/or completely new firms come in to employ the idle laborand capital left behind by the poorly run company. Zombie Banks and Government Motors are a drain on our Treasury and on the resources that could be flowinginto the more productive and leaner firms that would be predominating or emerging right now, if the government let the market work and do what it does best,allocate and use resource very efficiently.

Given the many tools in the government's kit, It seems prudent to use those tools properly and judiciously and to see that some are almost always worthless(except in extreme situations, such as a full scale war where price controls, intense minting of new currency and government directing the means of productionheavily into the war effort), other can be very useful but need to be use every carefully and other that are often times under utilized and will only causeharm if they are clearly mishandled. With this in mind, with the experience of centuries and from scores of nations it is clear that government intervention inthe economy should be done to varying degrees based on its type.

The best system that we can have, to maximize happiness and wealth is to be laissez-faire in some areas have moderate government control in some areas and tohave government be active in other capacities. We need a laissez-faire policy with regards o business decision making, it should be largely free fromgovernment control and certainly should not be operated by government, let the best ideas emerge and thrive and let bad ones disappear, let resources beconstantly moving so they can be with there highest valued user. Do not use price controls, prices reflect under lying realities of supply and demand at thetime and changing prices by decree not only fail to solve the problem but make it worse by causing shortages or overproduction and wasted resources. Finally,Central banks should either be forced to commit to low inflation, price stability or they should have to compete with privately issued currency.

Government should have regulations for consumers and workplace safety; for preventing, ex ante, very serve accidents or externalities and most otherregulations should not control what producers or consumers do but rather what producers/sellers have to disclose and how they have to disclose it to consumersor business partners. This moderate approach should be applied to public service and public goods but they should be over used because they can be very costly.

Part 7 Conclusion

Finally, government should do more of what it does or can do well. It should have a fairly robust negative income tax as well as a decent guarantee minimumincome, if we did not have bailouts and corporate and farm subsidies and a social security system that gives lots of money to well off seniors, we couldsupplement wages of low income earners and provide welfare those who are disabled. Not only can we be a more compassionate society but we can substitutegovernment programs of redistribution for many current and counter productive forms of government economic intervention.

Price controls that are meant to help the poor, can be substituted with more generous food stamps and vouchers for gasoline as the market price increases.Generous unemployment benefits can substitute for the disastrous policy of trying to ensure full employment through inflating the currency and debt spendingover the long term. Those benefits also reduce the pain and uncertainty and anxiety caused by a dynamic economy that does create and destroy jobs at a fasterpace than centrally planned one. Helping people pay for insurance and healthcare and out right paying for it for poor or very sick people is a way of notkilling the high quality of our healthcare, that our somewhat market driven system delivers, but it also allows for access for those who currently cannotafford much of it right now.

A very good social safety net can be compliment to capitalism. Capitalism needs to be largely unbridled and when it is set free it produces far more wealth,especially over time where the cumulative gains add up year after year. The freer the market the more efficiently resources are allocated and every fraction ofpercentage point of growth compounds with every time period and when ever we can substitute policies that cause inefficiency with good, well executedredistribution programs we allow capitalism to work at it optimum levels while protecting ourselves from the short run difficulties that it can create, when itis allowed to function at it optimum levels.

My own economic philosophy, as you can see, is to be socialist in some areas, moderate in others and laissez-faire in others. To those who are interested, whatdo you think of my analysis?



Shorter Version: There are many different types of government intervention in the economy but those distinctions are not often times made. People bundlewhat should be separate discussions, for instance, it is assumed that if you opposed the bailouts, you opposed unemployment benefits for those who get laid offif GM or Chrysler liquidated. I proposed a Social-Market system, one that lets markets work in a fairly unencumbered fashion, and one that produces lots ofwealth should be combined with a government that is active in helping individuals who are poor or who have fallen on hard times. By operating this way, we canuse various forms of welfare or government insurance programs to be a much more effective and cost effective substitute for disastrous policies such as minimumwage, price caps on gasoline, government bailouts and inflationary monetary policy which are meant to avoid unemployment at a far greater cost that providingsignificantly more generous unemployment benefits. This pattern of substituting welfare and insurance for other types of government intervention is much morehumane and effective solution to our current economic woes.

 

[littlepetewrigley]

Dropping knowledge as usual. This will def. help in the fall. I'll try to come back later and discuss. Good looks, Rex.

 

[dopestop]

wow
cliffnotes

 

[run dlc]

*bookmarked.

 

[rexanglorum]

I broke it up into parts so it does not feel like one endless scroll and to make it easier to read in parts if one opts to read it that way.

 

[kix4kix]

I am shocked to find how socialist this manifesto is. Pleasantly might I add.

 

[fede dpt]

Tough time agreeing.


There are only 2 ways of coordinating the economic activities of millions.

1. Central direction involving the use of coercion i.e. Totalitarian State
2. Voluntary cooperation of individuals. The problem with this is that there are too many people in this country who aren't educated enough to understandthis.


The Free Market and Capitalism are easy to understand. Enterprises are private, reason being ultimate contracting parties are individuals and individuals arefree to enter or not to enter in any exchange, which makes every transaction voluntary. What makes the Free Market so great is that it gives people what theywant instead of what a particular group THINKS they should have.


In my opinion, the Gov't is only essential in "determining the rules of the game", the biggest threat to freedom is power to coerce whether it isa dictator, an oligarchy, or a momentary majority.


Economic power HAS to be separate from political power, so it can serve like a check to counter political power. Why do you think when Gov't gets involvedthe economy sucks? Every act of Gov't intervention limits the area of individual freedom DIRECTLY and ultimately threatens the preservation of freedomINDIRECTLY.

Freedom is only a tenable objective for responsible people.

Government should have regulations for consumers and workplace safety; for preventing, ex ante, very serve accidents or externalities and most other regulations should not control what producers or consumers do but rather what producers/sellers have to disclose and how they have to disclose it to consumers or business partners. This moderate approach should be applied to public service and public goods but they should be over used because they can be very costly.


I don't agree with this, but I don't have time to explain right now. Later on I'll get into this.

 

[kix4kix]

Originally Posted by Fede DPT

Good analysis.


There are only 2 ways of coordinating the economic activities of millions.

1. Central direction involving the use of coercion i.e. Totalitarian State
2. Voluntary cooperation of individuals. The problem with this is that there are too many people in this country who aren't educated enough to understand this.


The Free Market and Capitalism are easy to understand. Enterprises are private, reason being ultimate contracting parties are individuals and individuals are free to enter or not to enter in any exchange, which makes every transaction voluntary. What makes the Free Market so great is that it gives people what they want instead of what a particular group THINKS they should have.


In my opinion, the Gov't is only essential in "determining the rules of the game", the biggest threat to freedom is power to coerce whether it is a dictator, an oligarchy, or a momentary majority.


Economic power HAS to be separate from political power, so it can serve like a check to counter political power. Why do you think when Gov't gets involved the economy sucks? Every act of Gov't intervention limits the area of individual freedom DIRECTLY and ultimately threatens the preservation of freedom INDIRECTLY.

Freedom is only a tenable objective for responsible people.

I agree with 99 % of what you said. Interesting insight.

 

[smedroc]

Warning this is a very long read (by the standards of message board)...
i stopped here...oh the irony.

gonna have to read it now to get rid of this feeling of guilt

 

[hueyp in louiev]

Western European Mixed Economies FTW.

I agree on everything except the portion on price controls and social safety nets as well as some of the bailout criticism. Uninhibited Laissez-faire incertain sectors like housing rentals and payday loans have proven to be worse than the criminal alternative many times and may serve to prop up a seedy blackmarket under the shadow of their greed.

As for the bailouts...When economic necessity meets political reality, disaster strikes more often than not. While there are serious ineffiencies inherit inthe recovery act, extenuating circumstances factored... I dont think the gov't did that bad of a job. Imo, our economy could not handle the tremendousbloodletting truly necessary to completely purge all of the toxicity and mismanagement out of our financial markets...not to mention the political backlash andupfront pain that type of economic tough love would dictate. There is also a serious culture of corporate efficiency and streamling re-emerging and tricklingthroughout the economy as a result of the ''just less than what you asked for'' bailouts. Thrift and innovation are filling in the gap of lostrevenue and investment. Absent those subsidies decisions would have been propelled by paranoia and anxiety.

Posting from my phone, so I cant be as clear as I would like but hopefully this is around later. Good thread.

 

[hueyp in louiev]

Fede with the over simplified Fox news view of the world as usual.

It doesnt always have to be this or that bro. There is a lot of middleground as far as economic systems are concerned.

 

[rexanglorum]

Originally Posted by Fede DPT

Tough time agreeing.


There are only 2 ways of coordinating the economic activities of millions.

1. Central direction involving the use of coercion i.e. Totalitarian State
2. Voluntary cooperation of individuals. The problem with this is that there are too many people in this country who aren't educated enough to understand this.


The Free Market and Capitalism are easy to understand. Enterprises are private, reason being ultimate contracting parties are individuals and individuals are free to enter or not to enter in any exchange, which makes every transaction voluntary. What makes the Free Market so great is that it gives people what they want instead of what a particular group THINKS they should have.


In my opinion, the Gov't is only essential in "determining the rules of the game", the biggest threat to freedom is power to coerce whether it is a dictator, an oligarchy, or a momentary majority.


Economic power HAS to be separate from political power, so it can serve like a check to counter political power. Why do you think when Gov't gets involved the economy sucks? Every act of Gov't intervention limits the area of individual freedom DIRECTLY and ultimately threatens the preservation of freedom INDIRECTLY.

Freedom is only a tenable objective for responsible people.

Why do you have a tough time agreeing, I said what you said about govrnment controling an economy. It is dangerous and is a road to poverty. The market needsto be allowed to work and let winners emerge and losers fade away and their claim on the labor and capital and liquidy needed for production flowing to thosewho can produce more effcicently and be more responsive to what consumers want.

My policy ideas would very likely allow the process of a more wide open and dynamic and private property driven market to flourish and cause even more realwealth to be created than has be created before in history. By spendi nga fraction of what is spent to prop up unproductive firms, money can go diretly topeopel and that money can be used to elivate the discomfort and sometiems pain that is caused by market forces at work. More substantial unemployment insurancein concert with not saving companies that should be out of business would cost the same or less and in the long run the market is allowed to actually work anddirect resources more efficiently. The same would be true for substituting a minimum wage for a negative income tax, it achieves what advocates of minimum wantbut it would be more effective and it would also reduce unemployment and get lower skilled workers started in gaining human capital.

Basically, when we have a problem, a social situation that is result of the fact that the market will leave a some people behind, it is more efficient to solveit with somethin gfrom the "helpful" category and thus avoid, something from the "harmful" category. Society gets the same ends (andprobably more so than somethin gsuch as government ownership or price controls), with means that generally will be less costly (usually to the public treasuryand alwasy in terms of economic efficiency) and it also reduces the likelihood of tyranny forming because it makes it very difficult for government to justifyseizing property or taking over formerly private firms in the name of the poor or the public interest.

 

[Betonblck]

The one part I very much disagree with is your stance on minimum wage. Without minimum wage, in places where there is a significantly large supply of labor,you get wages that are well below the poverty level. This isn't the old days where I can go out and hunt for my food so a person should be paid an amountthat should ensure that they can at least live on. Otherwise, we have the equivalent of modern day slavery/indentured servitude.

There are increased social costs when wages are below the poverty level such as increased criminal activity.

 

[rexanglorum]

cguy610 wrote:

---

The one part I very much disagree with is your stance on minimum wage. Without minimum wage, in places where there is a significantly large supply of labor, you get wages that are well below the poverty level. This isn't the old days where I can go out and hunt for my food so a person should be paid an amount that should ensure that they can at least live on. Otherwise, we have the equivalent of modern day slavery/indentured servitude.

There are increased social costs when wages are below the poverty level such as increased criminal activity.
That is what a negative income tax would be do, actually ensure a living wage, how ever that is may be defined. Minimum wage laws, like all pricecontrols, have failed to do what their advocates said that they would do. Minimum wage reduces employment among those who are the least skilled, that is whypeople without a high school diploma are unemployed at over four times the rate of those with at least a bachelors degree.

Giving lower skilled/poor people some money is more effective at achieving the ends that you want, making sure that people are at least above the poverty line.

 

[n o r e a g a]

...braindead.

This will def. be copied and saved though. Never know when it'll come in handy!

 

[Betonblck]

Originally Posted by Rexanglorum

cguy610 wrote:

---

The one part I very much disagree with is your stance on minimum wage. Without minimum wage, in places where there is a significantly large supply of labor, you get wages that are well below the poverty level. This isn't the old days where I can go out and hunt for my food so a person should be paid an amount that should ensure that they can at least live on. Otherwise, we have the equivalent of modern day slavery/indentured servitude.

There are increased social costs when wages are below the poverty level such as increased criminal activity.

That is what a negative income tax would be do, actually ensure a living wage, how ever that is may be defined. Minimum wage laws, like all price controls, have failed to do what their advocates said that they would do. Minimum wage reduces employment among those who are the least skilled, that is why people without a high school diploma are unemployed at over four times the rate of those with at least a bachelors degree.

Giving lower skilled/poor people some money is more effective at achieving the ends that you want, making sure that people are at least above the poverty line.







First let me say, I think you are probably one of the brightest most sensible forum members here when it comes to ecnomics. Now onto the discussion.


I disagree here. You advocate that government subsidize wages that are below the poverty line? Where would the additional tax revenue come from to subsidizesthese wages? I hope in the form of higher corporate income taxes.

This essentially would allow businesses to fatten their bottom lines at the expense of tax payers. Minimum wage is a better solution. Also, on unemployment,I think most economists/central planners structure policy to encourage unemployment because many hold the belief that full employment leads to inflation. Sotherefore, their goal is to have some unemployment to put downward pressure on wages.

Price controls are necessary for essential goods and services which have inelastic demand. There should be controls that prevent dramatic price movements ingoods and services that are essential to national security. I think the current price controls that we have in many utilities should extend into gas prices. This also helps with economic stability.

For example, after Hurricane Katrina, we saw a large spike in energy prices that nearly put us into a recession. Although there was no actual disruption insupply to cause such a large spike. A price control that set a maximum increase on the short time price increases in energy would have very much helped us.

A price control is even more necessary when we allow companies to merge and become so large that they make up nearly an entire industry. If we allow formonopolies and oligopolies, we should have some sort of control to at least ensure us from dramatic short term price increases in goods and services that areessential to survival.

 

[josebronx]

Originally Posted by Run DLC

*bookmarked.

 

[theconditioner]

Quickly, I'd say it leaves out a lot of crucial information.

I'd distinguish between the conventional definition of socialism and the technical definition (and the thousands of other possible definitions).

Also, I'm not so sure about your views on price controls. For example, price controls being removed in African markets during structural adjustmentstarved Africans. To quote Jeffery Sachs, "...history has shown you need to help people get above the survival threshold before the markets can startfunctioning." This is a pretty huge point, considering that a large proportion of the world lives in poverty.

Other things people must consider:

-distinguish between capitalism and free markets
-mechanisms that increase income and wealth disparity
-dynamics between property rights and innovation ( ex: intellectual property rights can promote innovation, yet hinder it at the same time)
-economic growth and education
-monopoly and oligopoly power

 

[jdb1523]

Rexanglorum: will read in a bit as it's long, but your posts are always appreciated

Also, here's a good blog for everyone who likes to keep up with Econ/Finance...I've just checked it out today and it seems legit, heard about it on apodcast. If it's far left or right...forgive me

:

http://optionarmageddon.ml-implode.com/

 

[curiousgeorg3]

i think an economy without a minimum wage would encourage people to seek higher paying jobs and go to school. companies would be able to run more efficientlyand people would be better off in the long run. maybe the gov. should subsidize education more instead.

and price controls are horrible for the economy, we all saw what happened during the oil shortage of the 70s/80s

 

[fede dpt]

Originally Posted by HueyP in LouieV

Fede with the over simplified Fox news view of the world as usual.

It doesnt always have to be this or that bro. There is a lot of middleground as far as economic systems are concerned.

You're pathetic, bro. You, Essential, and SunDOOBIE cant say anything else? There is no middle ground, you cant have regulation and a Freee Market, if youdo, then it is not a Free Market.

Basically, when we have a problem, a social situation that is result of the fact that the market will leave a some people behind, it is more efficient to solve it with somethin gfrom the "helpful" category and thus avoid, something from the "harmful" category. Society gets the same ends (and probably more so than somethin gsuch as government ownership or price controls), with means that generally will be less costly (usually to the public treasury and alwasy in terms of economic efficiency) and it also reduces the likelihood of tyranny forming because it makes it very difficult for government to justify seizing property or taking over formerly private firms in the name of the poor or the public interest.


The thing is that I dont care about the Masses, I'm worried about the individual. I'm not even a economy major or anything, I'm a in the medicalfield (I'm actually between patients now), but Economics and Policy are my hobbies. I treated a patient a few weeks ago during my rotations and he isactually a friend of the late Milton Friedman and he say "Do you know what the biggest minority in the world is?" me "No.", he said the"Individual." and he's 100% right.

Ok now, price controls. This is the problem, whether it is legal or voluntary would be destructive to the Free market system and be replaced with a centrallycontrolled system and WOULD NOT be effective in preventing inflation. Gov'ts always ask for the self-restraint by business because they can't evenmanage their own affairs, in which includes the control of the monetary system, just look what is happening now. The Gov't wants "caps" on CEOwages because of the too much regulation in fall of the housing market where banks were coerced to give out loans.

Government should have regulations for consumers and workplace safety; for preventing, ex ante, very serve accidents or externalities and most other regulations should not control what producers or consumers do but rather what producers/sellers have to disclose and how they have to disclose it to consumers or business partners. This moderate approach should be applied to public service and public goods but they should be over used because they can be very costly.


I've been dying to talk about this. An example I will use is OSHA, it is essentially worthless, OSHA costly interferes and reduces productivity. OSHAattempts to set standards and practices and equiptment especially here in the medical field, these standards DO NOT minimize the hazard or death in the medicalfield, they cant protect someone pricking themselves with a needle, regulation does not prevent it. Also, OSHA can and has violate the 4th amendment by cominginto people's businesses and unwarrantly check people businesses. I will get back later on Medicare and SS.

 

[Betonblck]

Originally Posted by CuriousGeorg3

i think an economy without a minimum wage would encourage people to seek higher paying jobs and go to school. companies would be able to run more efficiently and people would be better off in the long run. maybe the gov. should subsidize education more instead.

and price controls are horrible for the economy, we all saw what happened during the oil shortage of the 70s/80s

Have price controls had a horrible effect on China's economy? Would price controls have minimized the economic impact of Hurricane Katrina?

 

[kobefan23]

Programs such as social security end up taking wealth from lower earners and serving as welfare for the middle class and upper middle class.

Can you explain this Rex?

 

[essential1]

Fede DPT wrote:

---

Originally Posted by HueyP in LouieV

Fede with the over simplified Fox news view of the world as usual.

It doesnt always have to be this or that bro. There is a lot of middleground as far as economic systems are concerned.

You're pathetic, bro. You, Essential, and SunDOOBIE cant say anything else? There is no middle ground, you cant have regulation and a Freee Market, if you do, then it is not a Free Market.

Basically, when we have a problem, a social situation that is result of the fact that the market will leave a some people behind, it is more efficient to solve it with somethin gfrom the "helpful" category and thus avoid, something from the "harmful" category. Society gets the same ends (and probably more so than somethin gsuch as government ownership or price controls), with means that generally will be less costly (usually to the public treasury and alwasy in terms of economic efficiency) and it also reduces the likelihood of tyranny forming because it makes it very difficult for government to justify seizing property or taking over formerly private firms in the name of the poor or the public interest.


The thing is that I dont care about the Masses, I'm worried about the individual. I'm not even a economy major or anything, I'm a in the medical field (I'm actually between patients now), but Economics and Policy are my hobbies. I treated a patient a few weeks ago during my rotations and he is actually a friend of the late Milton Friedman and he say "Do you know what the biggest minority in the world is?" me "No.", he said the "Individual." and he's 100% right.

Ok now, price controls. This is the problem, whether it is legal or voluntary would be destructive to the Free market system and be replaced with a centrally controlled system and WOULD NOT be effective in preventing inflation. Gov'ts always ask for the self-restraint by business because they can't even manage their own affairs, in which includes the control of the monetary system, just look what is happening now. The Gov't wants "caps" on CEO wages because of the too much regulation in fall of the housing market where banks were coerced to give out loans.

Government should have regulations for consumers and workplace safety; for preventing, ex ante, very serve accidents or externalities and most other regulations should not control what producers or consumers do but rather what producers/sellers have to disclose and how they have to disclose it to consumers or business partners. This moderate approach should be applied to public service and public goods but they should be over used because they can be very costly.


I've been dying to talk about this. An example I will use is OSHA, it is essentially worthless, OSHA costly interferes and reduces productivity. OSHA attempts to set standards and practices and equiptment especially here in the medical field, these standards DO NOT minimize the hazard or death in the medical field, they cant protect someone pricking themselves with a needle, regulation does not prevent it. Also, OSHA can and has violate the 4th amendment by coming into people's businesses and unwarrantly check people businesses. I will get back later on Medicare and SS.




Don't come at me with the I use stop the Fox News propaganda all the time as a matter of fact I rarely use it, unless it is something word forword from fox news (I do catch Fox News from time to time)... I just make you look like a total idiot and irrational on many topics.

Also NO Regulation on things is BAD.. That is why we are a mixed economy and when we allowed the Financial Sector to go more and more towards the no regulationside the whole world financial balance stumbled.

Rex I'll make sure I read this at some point... When I do I might PM my thoughts instead of having people jump in.

 

[solemunchies]

Thanks for posting, OP. I definitely appreciate one of the few brains on NT!