No biggie at all. Actually I think we are pretty darn close on everything else though. At least a lot closer than we appeared to be a few pages back Which is great, now I don't feel like I am completely off my rocker.
You're not crazy at all. For awhile, I thought either you were or I was and I was too crazy to see I was the crazy one. The old "Do crazy people know they are crazy?" type of thing. Haha.
Definitely a big improvement. As the older generations die off where the habit was much more acceptable and ingrained into the culture I would expect there to be a massive decline. I would love to think that the same "bad-habit-breaking" over time would work with people when it came to their own finances but I'm fairly skeptical.
There was a good read a few weeks ago about the decline in teenage smoking. I looked for it but couldn't find it. Suffice it to say that smoking will continue to drop quickly.
As to smarter financial decisions, I don't know either. I do think educating people would help. Not sure how much, but it couldn't hurt.
I feel the same way and am much more in favor of "sunset" regulations that have to be renewed at set intervals. Regulation that is required right now to get the economy back on track may not be needed or may need to be altered in the near future. The economy is ever-changing so should the regulation that keeps it balanced.
The downside for me is that I tend to see the US as a borderline corporate oligarchy so that would mean that the corporations would have to basically pass regulation against themselves which seems very doubtful. At the very least the measures wouldn't be passed without extreme concessions that could likely result in trading one problem for another. It is going to take a fairly radical change from both the electorate (something that more education can definitely improve) and the politicians.
I've thought about this quite a bit more and I admit some sort of regulations are necessary. If banks were fully allowed to fail, the "smarter" banks would buy up the other banks when they made dumb decisions and eventually we'd wind up with one or two massive banks, and could easily fall into the "too big to fail" situation again. Needless to say that wouldn't be good. Just not sure how many or what type of regulations would be necessary. Having a certain percentage of liquid capital versus amount loaned out would be mandatory of course (already in place now I believe, maybe a bigger percentage is needed...), but beyond that, I'm not sure.
Absolutely not, that would lead to complete stagnation of the economy. Making profits is the only way to grow the economy. It all comes back around to the bailouts that we both agree were a necessary evil and the need to prevent that type of situation from playing out again. If banks were making a normal profit that were growing the economy, if they were providing people with value then we very likely wouldn't be having this conversation. The banks would not have made a profit from the service or value they provided to the economy without the bailouts, they would have been bankrupt and out of business.
I guess I view it as people buying more, and more companies breaking even instead of losing money. I read somewhere that it costs $2 for a DVD movie. Disk, packaging, salaries, etc. Could buy a bunch of DVD movies for what 1 currently costs. Spread that around and all of the companies are in no financial harm. You're right that they couldn't grow or expand, but no one would be laying off workers or going bankrupt. Overall though, yeah, it would stagnate.
I wouldn't read too much into the government yelling for more lending right now. I would mark that up as politicians being politicians and pandering to voters with the "well we have tried, its not our fault". So many businesses (banks included) are over-leveraged right now there is a much lower demand for loans. People and businesses are trying to pay down debt right now, not take on more debt. Lower consumer spending, lower product demand, low confidence in the economy, a bubble that is still settling, and all the other fun stuff that goes with a recession all add up to fewer loans.
That is possible. Elections are coming up, so maybe that's all it is. I don't have a lot of faith in the government, I've read way too much where they are totally out of the loop when it comes to the people. So I generally think the worst when I read stuff like what I wrote. Maybe you're right and it's just sound bytes for the election though.
Skin Blues wrote:I'd rather pay 50% tax on $120K and at the same time get great health care and education than pay 10% tax on $75K and have to pay for my health care and education on top of that out of pocket (and I'm the lucky one that can actually afford it). So how crazy are those people, really? And it's not 50% up here in Canadia anyway, but still, even if it was would it be worse? Look at quality of life, not just dollar signs. The US is full of miserable, fat, lazy, people but at least they don't pay a lot of taxes. Hooray!
So what about us that pay 10% (closer to 20% actually) tax and have great health care and good schools? I'm just plain old middle class, but my entire family has always received fantastic health care (will admit it has been rarely needed) and my kid is in a school system that has a surplus of funds (not rich, but they are doing well). Now I do pay for health insurance out of pocket, and it isn't cheap, but it isn't enough to jump me to 50% in taxes either (puts me to about 25%). As to quality of life, with that extra 25% that I get to keep, that certainly helps with quality of life. Better neighborhood, better food, more vacations, nicer items (like electronics), etc.
On the personal level, it's about what the government deserves. Right now, they deserve maybe 5% of what I make. When I start seeing better decisions out of government, I'll feel like taxes are fair. And no matter what they do, they'll never be worth 50% of what I make. I'll move long before I ever pay anything like that.
Oh, and all the commotion about "outsourcing"? If the tax rate here ever got anywhere near 50%, I can't imagine many jobs being left. Wages would have to rise by so much that I couldn't imagine very many companies would still have businesses in America. They'd ship them all out of the country because they wouldn't be cost effective at all.
The Artful Dodger wrote:
Yes, such are the effects of the meritocracy: there will be high performers, many who fall in the middle, and those who don't do as well. The bigger problem is, when people are born into a situation where opportunity is limited, and a meritocracy, which is good, becomes one that's determined by social inequality, which is bad. Furthermore, the system doesn't have to be one which produces the unintentional result of "winners and losers". If the average segment of a class can still churn out exceptional students (only dwarfed by those who are superb to the next level), then the educational system is doing its job.
Somewhat related to this, here's a good read on Finland's successful educational system
, a few things America could take a page from although it would take quite an overhaul to achieve (i.e. selectivity in hiring teachers with Master's degrees, less significance on standardized testing). Also, the article does bring up much of the things we've been discussing, namely poverty having a significant effect on educational outcomes.
Everyone can't be winners though, because at that point everyone is just normal, not exceptional. It's a yin/yang thing.
Good read. I could discuss tons of stuff, but let's see how much I do. From the article:
"Teachers and principals repeatedly told me that the secret of Finnish success is trust. Parents trust teachers because they are professionals."
2 things. Being a "professional" doesn't mean a thing here anymore. Too easy of a title to get, so quite a few people who have no idea what they are doing in their particular field are considered "professionals", even though they shouldn't be. So the title doesn't mean anything anymore. On the trust side of the coin, it isn't there because the teachers have proved to be inept at their jobs. Look no further than the sports figures on television doing interviews. They have college credits, yet can't speak anything remotely close to how they should. What isn't televised is that it isn't just athletes that skate by, there are tons of regular kids that the teachers just don't want to be "bothered" with, so they pass them on to the next grade, even though they shouldn't. We were discussing the idiots that couldn't do a budget earlier, remember? So needless to say the teachers have no trust because they have proven to not be trustworthy. We need standardized testing to prove the teachers are at least teaching the basics (which they are failing to do). Needless to say we can't trust a teacher's opinion as to if a student has learned enough or not.
I wonder why you came to that conclusion. I don't see anything wrong with businesses settling for breakeven and proverbial small potatoes, for success and failure are subjective outcomes for each business owner. When most people think of success, they think of businesses with six and seven figure revenues, and for some that's the goal. There are many who pursue that goal, and the number of failures tend to be more of the norm than the success stories.
Glad to see I just misread the tone. Easy enough to do in written communication and why I asked if I was misreading it.
If someone paying their way with their own business is considered successful (which is the definition I use), I would argue there are more successes than there are failures. If we're talking about success as making millions, then absolutely, failure is the norm and dwarfs the successful. All just a matter of definition or viewpoint of "success" is all.
Yes, there are progressive tax brackets in those social democracies as well.
Actually, I have to clarify that many of the developed European countries pay 40-50% of income. Denmark, Sweden, Germany, and Belgium pay close to 50%, depending of course how much they make (the average citizen is taxed at around mid-40's-ish). The French government has been ruled by the right for almost a decade now, but still, the average French citizen pays roughly 40%. Only Switzerland is as tax-friendly as the US among Western European countries.
As excessive as the tax rate is in those countries, look at the things your taxpayer money would go towards: world-class universal healthcare, subsidized education at every academic level, generous family/sick leave, high salaries that keep up with cost of living, and more employee-friendly conditions. Some of the things people worry about in America, they wouldn't have to worry about in those places. In some way, the social services paid for is cheaper compared to the same exact quality goods spent in America. It seems counterintuitive from an American perspective, but FWIW, said countries do rank highly on global happiness and standard of living indexes.
I don't know, I just can't imagine giving 40% of what I make to the government. The thought of growing my business to a point of having to pay 40% in taxes makes me not want to bother growing it to that point. Maybe that's because I'm thinking of our crappy government though. Maybe I should "vacation" for a year elsewhere and see how they do things firsthand.
I want to play a game. The rules are simple. All you have to do is sit here and talk to me. Listen to me. We haven't been properly introduced. My name is John.
Live or die. Make your choice.