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Thread: Communism and Capitalism: True Opposites?

  1. Top | #71
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    Now we are getting into the moral philosohy aspects.

    The part myth part reality belief in our modern free market system is that you get in proportion to how hard you work and risks you take. The obvious is the playing field is never even. Being born to money gets you a top education and never having to earn anything, like Trump.

    The earnings disparity is a serious problem. There is another aspect to it. When you accumulate money it can not just sit. It looses value. It gets invested in the economy funding busness for one thing through investment.

    It is complex but in ways not obvious to the average observed,. We do benift in some ways from accumulation of wealth. It drives investment and innovation.

    What is simplistic is making arguments based on the simple top bottom disparity ignoring everything else. Who does not have a wireless device that can communicate globally 24/7? You have to weigh the positives and negatives and that is not trivial. The forum exiasts technologucaly couresy of the free market competition system. Competing ideas and technolgy leading to the current technology. Nothing came out of Russia and China.

    Conservatives argue capitalism is more in line with human nature. Soviet communism with its enforced ideological eaquality was a dull, lifeless, dreary society. There was no room for personal initiative, risk, and reward. The result a stagnant society. Maoism failed catastrophically with large scale famine. In the post Cultural Revolution era farmers were allowed to grow and sell excess above the state quotas.Agricultural production began to grow. China evolved to a mixed economy. The overall economy is centrally controlled while there is room for initiative and accumulation of wealth from enterprise.

    It seems like us humans seem to need to have a degree of independence.

    Capitalism like communism has shades of meaning to different people. Here in the USA it means free enterprise. The media focuses on the giants like MS and Apple. In reality the majority of business is small to medium scale sartted by average people.

    I worked for a guy who started a company. He built a business building custom audio and video systems for private high end aircraft owners. He started in his garage. He mortgaged his house and lived at his company for several years doing everything that needed to be done. He employed at the time a handful of engibneers and manufacturing workers. IMO he deserve the profit he made.

    Both Apple and the original HP sted in a garge with a couple of guys.

    In our large scaly society should someone out of high school with no skills and experince be ‘owed’ anything?

    I like the Denmark model. Room for enterprise with a sufficient bottom to live.

  2. Top | #72
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    Quote Originally Posted by steve_bank View Post
    The part myth part reality belief in our modern free market system is that you get in proportion to how hard you work and risks you take. The obvious is the playing field is never even. Being born to money gets you a top education and never having to earn anything, like Trump.

    The earnings disparity is a serious problem. There is another aspect to it. When you accumulate money it can not just sit. It looses value. It gets invested in the economy funding busness for one thing through investment.
    Is the earnings disparity a serious problem?

    I don't want to look like I'm not for improving people's quality of life. But I do wonder about this talking point, and how we're supposed to do away with wealth inequality when there is such an obvious disparity in the value of people's natural ability and talent. Genetics would call this phenotypic variation, and this inequality doesn't only predate the modern period, but humans themselves. Even in other primates there is disparity in access to resources / mates because of individual attributes.

    Sure, some people are born into large amounts of money, but the overwhelming amount of people in the upper classes are not egregiously rich, they're just people well equipped to make money within the community they live. Their kids have advantages, but these kids are forced to succeed in school / find work just like everybody else. The truth is that people aren't built equally, and this will always be true.

    I always point people to the example of my dad's family. Five children, all with the same opportunities, but a different personality. The life outcomes of the five and their children vary wildly. My brother and I are both successful white-collar professionals in the upper-middle class, some of my cousins are unsuccessful by most normal standards and close to poverty level.

    The reality is that if parents don't believe they can provide their kids with an acceptable quality of life they can choose to not have kids, but people don't work that way. People reproduce without moral considerations, and the result is the result. We probably should try to support those people, but that support has obvious limits.. and should probably be set pretty close to where it already is now.

    Right now the problem isn't wealth inequality, it's overpopulation. People aren't making money because their skills are redundant.

  3. Top | #73
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    Yes it is a problem. Who wants to work hard if there is no level of comfort. Back in the 50s a guy working in a grocery store or a shoe store could afford a small house and family on a single income.

    Capitalism requires population growth to increase consumption and providing a return on investment,. Capitalism today is based on a mythical assumption of infinite growth. That is the post war paradigm. People are living longer so more youg pwople are needed to support them. Sooner or later there will be a system failure.

    Over here housing and medical costs are outpacing wage growth. We have a term 'working poor'. People who have jobs but can not afford housing.

    A good example is Amazon. Obscene profit's but a percentage of their employees are on some form of govt assistance.

    The Dallas Cowboys owner built a new stadium for around 1 billion dollars. While our infrastructure decays and we can not pay teachers, police, and fire decent wages.

    Eventually the inequities will lead to unrest as it grows. The post war economics is a great experiment that can easily fail if it gets too lopsided.

    The system needs to be tweaked so that a percentage excess wealth can be put to use for the common good.

    China has gotten good atr executing 5 year infrastrucr-ture plans. Our govr is usweless and our systems allows decay while some make a lot of money.

    It is a moral and philosophical issue. If you make a lot of money using roads, infrastructure, and educated people from the system do you owe the country anything? Steve Jobs of Apple said no. All that matters is profit, manufacturing in China and never the USA.

  4. Top | #74
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    Quote Originally Posted by steve_bank View Post
    Yes it is a problem. Who wants to work hard if there is no level of comfort. Back in the 50s a guy working in a grocery store or a shoe store could afford a small house and family on a single income.
    But then in the 50s there were almost no taxes for the average family or businesses compared to today. Today the average family pays out of their income something like 30% as federal income tax, somewhere between 5% to 15% state income tax, state sales tax depending on the state (my state is 7%), some cities and/or counties also levy income tax, then businesses taxes have increased which ends up as rising price of goods they sell to cover their business taxes so it is the final consumer actually pays the business taxes. Where the average family in the 50s paid on the order of 5% to 10% of their income in total taxes, today total tax bite can easily be greater than 50%. And then property taxes have steadily increased to where, in some locations, a family home is now a liability. Today with better than half the family's income going to taxes, the second income is needed to survive for many.

  5. Top | #75
    Sapere aude Politesse's Avatar
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    Quote Originally Posted by skepticalbip View Post
    Quote Originally Posted by steve_bank View Post
    Yes it is a problem. Who wants to work hard if there is no level of comfort. Back in the 50s a guy working in a grocery store or a shoe store could afford a small house and family on a single income.
    But then in the 50s there were almost no taxes for the average family or businesses compared to today. Today the average family pays out of their income something like 30% as federal income tax, somewhere between 5% to 15% state income tax, state sales tax depending on the state (my state is 7%), some cities and/or counties also levy income tax, then businesses taxes have increased which ends up as rising price of goods they sell to cover their business taxes so it is the final consumer actually pays the business taxes. Where the average family in the 50s paid on the order of 5% to 10% of their income in total taxes, today total tax bite can easily be greater than 50%. And then property taxes have steadily increased to where, in some locations, a family home is now a liability. Today with better than half the family's income going to taxes, the second income is needed to survive for many.
    Where are you getting those numbers??

  6. Top | #76
    Veteran Member skepticalbip's Avatar
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    Quote Originally Posted by Politesse View Post
    Quote Originally Posted by skepticalbip View Post
    Quote Originally Posted by steve_bank View Post
    Yes it is a problem. Who wants to work hard if there is no level of comfort. Back in the 50s a guy working in a grocery store or a shoe store could afford a small house and family on a single income.
    But then in the 50s there were almost no taxes for the average family or businesses compared to today. Today the average family pays out of their income something like 30% as federal income tax, somewhere between 5% to 15% state income tax, state sales tax depending on the state (my state is 7%), some cities and/or counties also levy income tax, then businesses taxes have increased which ends up as rising price of goods they sell to cover their business taxes so it is the final consumer actually pays the business taxes. Where the average family in the 50s paid on the order of 5% to 10% of their income in total taxes, today total tax bite can easily be greater than 50%. And then property taxes have steadily increased to where, in some locations, a family home is now a liability. Today with better than half the family's income going to taxes, the second income is needed to survive for many.
    Where are you getting those numbers??
    I lived those numbers. I am an old fart and have been paying taxes for a hell of a long time. (well actually, I didn't start filling out my federal and state tax returns until the 60s but still do)... so I got those numbers from my tax return forms, property tax payments, and knowing how much sales tax I am paying.

    But then in that post I forgot about FICA... that is another about 15% tax, half directly deducted and the other half payed by the employer (who figures that cost in as total cost of hiring you when determining how much to pay so decreases the amount of salary offered by that amount.)

    Oops, also forgot about social security tax... a total of another 12.4% and again, like the FICA, half directly deducted and the other half paid by the employer who uses the same calculation to determine how much salary to offer.
    Just checked for the 1950s - in 1950 social security tax was 1.5% by 1959 it had risen to 2.5%
    Last edited by skepticalbip; 09-20-2019 at 07:11 AM.

  7. Top | #77
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    Quote Originally Posted by skepticalbip View Post
    Quote Originally Posted by Politesse View Post

    Where are you getting those numbers??
    I lived those numbers. I am an old fart and have been paying taxes for a hell of a long time.
    So, more a subjective appraisal perhaps.

  8. Top | #78
    Veteran Member skepticalbip's Avatar
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    Quote Originally Posted by Politesse View Post
    Quote Originally Posted by skepticalbip View Post
    Quote Originally Posted by Politesse View Post

    Where are you getting those numbers??
    I lived those numbers. I am an old fart and have been paying taxes for a hell of a long time.
    So, more a subjective appraisal perhaps.
    I wouldn't really call the numbers on tax returns subjective.

    ETA:
    By the way, have you ever examined exactly how much total tax you are paying - not just federal income tax but all taxes?

  9. Top | #79
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    Quote Originally Posted by steve_bank View Post
    Yes it is a problem. Who wants to work hard if there is no level of comfort. Back in the 50s a guy working in a grocery store or a shoe store could afford a small house and family on a single income.
    Where I'm getting lost is how this is related to capitalism, and not a natural malthusian cycle. In the 50s and 60s there was a post-war boom where people were highly in demand, and could make a decent wage doing work that wasn't overly skilled.

    Today that isn't the case because there is an overwhelming amount of people on the planet willing to do unskilled work. It's not something inherent to capitalism, it's basic supply and demand. As soon as our population declines to a level where people are in demand again, wages will go up.

    Now I know I'm starting to sound like a conservative, but I really do care about people's well-being. I just don't know that the answer to improve people's well-being is necessarily to give them more money. Because if suddenly an entire population has a completely comfortable wage, they produce more babies, and the supply / demand problem gets worse - we have even more people and fewer jobs and we enter an infinite loop where somehow we need to keep supplying the well-being of more and more people.

    Now maybe there is room for some improvement, but at some point we have to face the fact that there are real environmental limitations to our quality of life, and keep at least some of the responsibility on full grown adults to make good decisions about their offspring.

  10. Top | #80
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    Quote Originally Posted by skepticalbip View Post
    Quote Originally Posted by Politesse View Post

    So, more a subjective appraisal perhaps.
    I wouldn't really call the numbers on tax returns subjective.

    ETA:
    By the way, have you ever examined exactly how much total tax you are paying - not just federal income tax but all taxes?
    Well, it's just that your numbers don't resemble the actual tax rate. A family of median income pays about 17% in total federal taxes, that's a matter not just of statistics but of law. Very wealthy people are expected to pay closer to 30%. But most people with the kinds of jobs you describe aren't especially wealthy.

    It is true that taxes on average family were much lower in the 1950s, because they were being counterbalanced by very high taxes on the wealthiest of citizens. But I don't think we're going back to that area any time soon, whatever the Progressives may promise their voters in primary season. If we tried to slap a 90% tax on the top bracket now, their idiot employees would riot on their behalf.

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