BigBallinStalin wrote: PLAYER57832 wrote:BigBallinStalin wrote:PLAYER57832 wrote:thegreekdog wrote:I just want to make sure I get this "economic wheel" correct.
(1) Individual receives money from the government.
(2) Individual purchases food from Retailer with government money.
(3) Retailer purchases food from Farmer.
(4) Retailer and Farmer pay tax to the government.
(5) Government takes tax money, pays its own employees and step (1) is repeated.
Add in:
government employees pay taxes on their salaries, and yes, that is about right for that small segment.
No one, least of all I, have claimed that subsidies are all that should happen. MY claim was that these subsidies do not, as BBS asserted inhibit production of real goods, and do not stifle the economy just because they exist.
Of course, it goes without saying that no economy can be built solely upon government subsidies, unless we want to go Communist..a nd I would argue even "communist" countries don't really do that.
And why is that so?
Technically, it could be true.. if we wanted to all be communists. But, while that can work reasonably well on a small scale, on a large scale you have too much diversity amongst people. Its not that it "cannot" work, its that making it work would take away too much individuality, which is what the west, Americans particularly, treasure.
Well, when that experiment was scaled-up, it failed miserably---and it even had the prices from market economies abroad to somewhat rationally plan. So, technically, it's not true for governments and economies of larger scales (i.e. bigger than communes, the kibbutz, a family, etc.). Scaled-up communism didn't work, but we digress.
yeah, pretty much what I said.. I just added in why it did not work.
Anyway, back to your economic wheel of government subsidies:
BigBallinStalin wrote:Of course, it goes without saying that no economy can be built solely upon government subsidies
And why is that so--for economies larger than a commune?
You mention "too much diversity" and "too much [taken from] individuality." Was that the answer? If so, what do you mean? (expand on that please).
Yes, because people don't want to be equal, don't all want the same things. That IS why it won't work. No esoteric explanations needed.
Similarly, the idea that feeding people, clothing people doesn't keep most people from working is pretty basic. It keeps them from turning to crime, other nefarious results.
Per the stimulus? On a temporary basis, when the banks screw up so badly that there is almost no money flowing not just in the US, but in major portions of the world, when industry's idea of "investment" is to ship money off to China or Mexico because they can make a couple more cents profit.. yes. And economists in this country, as a whole (though of course not all individually) agree on that.
BUT.. to get back to the root, one point of the article was correct. We generate wealth through production. Its just that so much of what is passed off as "production" is really just interest on debts or profits from selling off assets that then no longer produce. Also, we have to have a better way of assessing wealth generation from removal of limited resources.. be it copper, natural gas or water. As long as those things are without value in the ground, or worse, have negative value (many minerals and such are taxed as if they were being withdrawn, even when they are not), there will be no true accounting.
Similarly, to consider a job a "benefit" when the people working those jobs are not making enough to even support themselves without government assistance.. then its not the people who are the "takers", its the company hiring them.
Similarly, as long as there is no true assessment of damage caused, then companies can continue to claim profit while actually causing the rest of us real harm and loss of income.
