Zero-sum Exchanges versus the Creation of Wealth

[PLAYER57832]

The point is that you don't create wealth by simply transferring wealth from one group of people to another.

EXCEPT, that argument is only used for the bottom, who just don't have another alternative. Fact is, that it IS better to give people money to buy food, housing.. and that it DOES "trickle up" to the local economy by supporting grocers, landlords, etc, etc. This is particularly true when the economy is down.

The argument is quite a real reason to NOT give big businesses and wealthy individuals more tax breaks, force the rest of us to pay down debt caused to a large extent by bailing out the big guys, paying for wars to benefit the big guys... etc. The debt was NOT caused by AFDC or even current healthcare (it would be a big part if things kept on as they were... will stil be a big part if not altered).

ALSO, claiming that Social Security and Medicare are "taking to give to others" is not really true. AT least, not if the program hadn't been used as a big piggy bank from which to borrow. Even then, its more in the lines of paying now for benefits YOU will recieve in the future. Or, you could say you are paying back for the educational supports you recieved (even if you went to fully private schools) when you were younger.

Models for the multiplier effect state otherwise. If you experience windfalls in labor productivity, you can justify the increase in people's wages. Simply depositing money from their account through involuntary exchanges or from essentially printing the money doesn't result in the creation of wealth, and the means for doing so simply lead to further distortions in the price mechanism, thus the economy--but of course, Keynesian models fail to see this because their models simply don't consider it.

Yeah, let's just pretend that the impacts of starvation, poor health, etc, etc don't matter. Becuase that is what is really at stake.. a few more dollars at the top, versus the basic well being of millions who happen to be at the bottom.

And again.. funny how all that seems to go out the wayside when it comes to the upper escheolon. THEY are the ones really getting benefit for no work or work not at all comminserate with their gain.

Take the multiplier effect to its logical conclusion. If the government spent $4 trillion on tricycles, the economy's GDP would increase by over $4 trillion.

If you don't wish to make your stance look absurd, then consider what the monetary and fiscal policy of the past 4-5 years has been. According to their models, we should be booming right now, but we're not. Gee, "we didn't do enough; yeah, that must be the only possibility." Of course, without any standard of comparison, they'll never know, so they can continue engaging in the same irrational behavior of doing practically the same thing while expecting different results.

LOL

The past 4-5 years? REALLY? You want to consider the past 4 years as if that is some great economic trend??? Well, if you insist.... During Bush's last year, we saw a near banking collapse.. which by-the-way contributed significantly to the losses in Europe (far more than the social programs you wish to attack). In the past few years, the real income of average Americans has gone down, while the incomes of those at the top, including the very bankers who caused this big mess.. have gone way, way up.

The Stimulus? Well, most economists do agree it helped. While it has not instantly turned around the rolling train, it at least did avert a major train wreck. Instead, we have a bit of a bump... and now have to work to reverse things.

If you dump money into people's hands, then hey! that should get the economy going. Stimulate aggregate demand and investment would increase, and people would have more money to spend and... oh wait, that shit hardly happened.

Hmmm... well, now you are talking politics, not economics.

Michael Grunwald, senior correspondent for Time magazine, has written a new book detailing how that $800 billion package came to be. It's called "The New New Deal: The Hidden Story of Change in the Obama Era."

Grunwald says the stimulus plan did stimulate the economy: "Certainly all the objective economists who have looked at it, there is overwhelming consensus that it certainly did create jobs and it certainly did promote growth after a terrifying freefall."

And though he says that many of the stimulus programs are actually popular with the public, the idea of government spending continues to be a tough sell.

"It turn out that most of the actual things in the stimulus -- the tax cuts, infrastructure projects and the clean energy -- people actually like them, they just don't like the stimulus," says Grunwald. "There's a reason that even President Obama won't say the word any more and it really has become toxic. "

http://www.marketplace.org/topics/econo ... s-stimulus

Why do you think the Federal Reserve is so opaque about its actual reports that inform the head guys on what to do? Because they would be a laughing stock if people could see how far off their predictions were. And there's been a pleasant mountain of $1.6 trillion of excess reserves sitting at the fed's bank accounts while people are shifting to investments in riskier financial assets. Yes, but please go on about the marginal propensity to consume and the multiplier effect! The economy has been booming from the insights of that school of economics.

The fed has promoted lowering interest rates. THAT part has failed. The stimulus.. not so much.

[BigBallinStalin]

BBS, you just don't understand the REAL issues. If we don't ensure that we have clean water, none of this zero-sum exchange stuff is going to mean anything.

Actually, that is very true. Too bad you consider it sarcasm.

She's right. If we had a GDP per capita of $100, surely, we could have water as clean as the water of a country with a per-capita GDP of $50,000. We would also experience the same life expectancies, standards in health, education, etc.

Nice big miss.
Ignoring the cost associated with NOT having clean, cheap, water is a far bigger part of the problem (both symptom and cause) than government subsidies ever were.

No, you're right, player. Zero-sum exchange stuff doesn't mean anything. Who cares about productivity!

If the "productivity" is actually causing a deficit.. either becuase the "production" is not real or because the damages caused are ignored, then yes.. and that is pretty well what that article did.

Despite the title, it was just another reworking of old disproven ideas.

Oh, wow, productivity is causing the deficit? That's simply amazing! I guess if we cut off everyone's left arm then I'd expect our deficit to decrease by about 12%.

[patches70]

What is Austrian Economics?

The thinking that using models and statistical tools are a poor way of predicting behavior. The boom-bust cycle is not a natural phenomenon but is caused by manipulations in the money supply. That inflation is a monetary problem, that is the supply of money is greater than the demand.

What is the Austrian Business Cycle Theory?

Massive credit creation (from artificially low interest rates) create the bubbles that eventually explode into a significant economic downturn. Such credit fueled bubbles encourage malinvestment which becomes a cancerous tumor on the body of the economic.

What are Hayek's main contributions to economics?

How changing prices influence future decisions. For instance, The Fed's ZIRP policy is falsely sending the message to spend today by sucking future money to the present. For the short term this may seem like a good idea, but in the future, when that money could have been used for greater benefit and wiser use, will not be there.

And what are Mises' main contributions to economics?

Human action has a specific goal, is purposeful. Each individual will make different choices even if faced with the same conditions. Thus, things like models and such are not a good thing trying to determine what humans will or will not spend money on. That a central authority cannot efficiently coordinate behavior.

For example, The Fed's policies which on paper told them that would lead to economic recovery is not working because they are going by statistical models which say if they do "X" then "Y" will happen. Except people have their own goals and no amount of manipulation by The Fed can significantly affect those goals, or the pursuit thereof.

Human action cannot be summarized by a simple model. The variables are too vast, individuals all with different goals and we cannot be boxed into such models and expect the models to work.


All stuff that the Keynsians have a very hard time understanding and accepting. That's why the Keynsian monetary policies always fail after a certain amount of time. Such thinking only focuses on the short term at the expense of the long term. But as we know, tomorrow becomes today, eventually....

[PLAYER57832]

No, you're right, player. Zero-sum exchange stuff doesn't mean anything. Who cares about productivity!

If the "productivity" is actually causing a deficit.. either becuase the "production" is not real or because the damages caused are ignored, then yes.. and that is pretty well what that article did.

Despite the title, it was just another reworking of old disproven ideas.

Oh, wow, productivity is causing the deficit? That's simply amazing! I guess if we cut off everyone's left arm then I'd expect our deficit to decrease by about 12%.

Pretending that the above IS productivity, yes.

I showed you how the fundamental assertion made above is wrong, but apparently you need more detail. See, giving people money for food actually DOES increase production because they go out and buy things. That stimulates the economy. Similarly, paying people just a bit more so they can either buy a bit nicer food or spend money on things not absolute, dire necessities increases purchases, increases the demands in an economy and very much does cause wealth to flow.

The article attempts to claim, essentially, that all you have to do is remove subsidies and suddenly everyone will go out and find gainful work that will help stimulate the economy. THAT doesn't work. It doesn't work because there just is not enough work around, it doesn't work because people who lack work lack the skills they need. What you actually do is create a '"race to the bottom" for what jobs are available. People begin to be willing to take employment that doesn't really support them, but might give them at least something to eat and maybe a not-so safe place to stay. A bit better than a box or vent on the street, but not much. People at work are more willing to put up with very poor conditions. Safety programs don't matter. No safety equipment? People won't complain because they know there are 10 people waiting for their jobs. Does that mean the conditions are good? No, it means more abestos or black lung type lawsuits 20-30 years down the road... meaningless lawsuits because the companies and people who made real money will be long gone by then, just like the old coal owners, mills, etc are long gone. WE, the taxpayers are left with that damage.

Further down, things get even worse. Take away money for food, clothes and food and, with very few exceptions, you don't suddenly create more incentive for them to work.. you cause them to be homeless, go hungry or become criminals.

Meanwhile, since everyone except those at the very top are making less money, we face cuts to education, transportation and healthcare. WE ALL lose becuase a few greedy jerks have been able to convince a bunch of people that too many people are "taking"... Its true. They just forget to mention its THEY who are taking from US.. not the reverse!

[BigBallinStalin]

No, you're right, player. Zero-sum exchange stuff doesn't mean anything. Who cares about productivity!

If the "productivity" is actually causing a deficit.. either becuase the "production" is not real or because the damages caused are ignored, then yes.. and that is pretty well what that article did.

Despite the title, it was just another reworking of old disproven ideas.

Oh, wow, productivity is causing the deficit? That's simply amazing! I guess if we cut off everyone's left arm then I'd expect our deficit to decrease by about 12%.

Pretending that the above IS productivity, yes.

I showed you how the fundamental assertion made above is wrong, but apparently you need more detail. See, giving people money for food actually DOES increase production because they go out and buy things. That stimulates the economy. Similarly, paying people just a bit more so they can either buy a bit nicer food or spend money on things not absolute, dire necessities increases purchases, increases the demands in an economy and very much does cause wealth to flow.

The article attempts to claim, essentially, that all you have to do is remove subsidies and suddenly everyone will go out and find gainful work that will help stimulate the economy. THAT doesn't work. It doesn't work because there just is not enough work around, it doesn't work because people who lack work lack the skills they need. What you actually do is create a '"race to the bottom" for what jobs are available. People begin to be willing to take employment that doesn't really support them, but might give them at least something to eat and maybe a not-so safe place to stay. A bit better than a box or vent on the street, but not much. People at work are more willing to put up with very poor conditions. Safety programs don't matter. No safety equipment? People won't complain because they know there are 10 people waiting for their jobs. Does that mean the conditions are good? No, it means more abestos or black lung type lawsuits 20-30 years down the road... meaningless lawsuits because the companies and people who made real money will be long gone by then, just like the old coal owners, mills, etc are long gone. WE, the taxpayers are left with that damage.

Further down, things get even worse. Take away money for food, clothes and food and, with very few exceptions, you don't suddenly create more incentive for them to work.. you cause them to be homeless, go hungry or become criminals.

Meanwhile, since everyone except those at the very top are making less money, we face cuts to education, transportation and healthcare. WE ALL lose becuase a few greedy jerks have been able to convince a bunch of people that too many people are "taking"... Its true. They just forget to mention its THEY who are taking from US.. not the reverse!

Your ability to presume knowledge of areas beyond your expertise is amazing.

[Timminz]

[tzor]

See, giving people money for food actually DOES increase production because they go out and buy things. That stimulates the economy. Similarly, paying people just a bit more so they can either buy a bit nicer food or spend money on things not absolute, dire necessities increases purchases, increases the demands in an economy and very much does cause wealth to flow.

What a pile of horse manure. It's clever horse manure because it is almost half right, but it's still more than half wrong. So let's see why.

First of all it is correct to say that giving people money will have a spending effect on the economy. We can call this effect SE(X) where X is the amount of money spent.

But where did this money come from? Well it came from people ... duh. It could come out of people's income (taxes) or it coud come out of their allocation of bond purchases (debt) but in either case it comes out of people. For a moment let's call the amount of money taken out X'. Now we know that there is a "cost" associated with the process of collecting taxes; let's call that Y. Since it exists, we know that because X = X' - Y that therefore X < X'. Now it becomes intitutively obvious to a casual observer that SE(x) < SE(X') or that when the two are added together (the spending caused by X and the now lack of spending caused by X') that there is a net decrease to the system.

But wait, what about the waste? Breaucurats spend money too! Fair enough I suppose, the actual calculation should be SE(X)+SE(Y)-SE(X') = THE NET EFFECT. Now we have to look at the function SE. How we define the function will determine how the NET EFFECT FALLS. You also have to consider the time effect on the equations because the time at which the money is taken to give to the waste and eventually the peple it is intended to give to does not happen at the same point in time T.

But while this is nice, it's wrong. You don't want to "stimulate" the economy, you want to grow the economy. I can buy a fish today, tomorrow I will be hungry. I can buy a fishing pole today, I can get a fish today, tomorrow, and so forth.

So the type of speding is important. Simply giving people money will not have a Growth Effect on the economy. But it will be taken from money that is being used to create a growth effect. Politicians spend money on their own reeelection so they have no growth effect. Thus you get the equation ... GE(X) << GE(X') or that the net growth effect on the economy is negative. The more the economy's growth is negative the more people are forced to depend on the government, who gives them money to spend, not moneyto grow. The result is an economic death spiral.

[PLAYER57832]

[ So the type of speding is important. Simply giving people money will not have a Growth Effect on the economy. But it will be taken from money that is being used to create a growth effect. Politicians spend money on their own reeelection so they have no growth effect. Thus you get the equation ... GE(X) << GE(X') or that the net growth effect on the economy is negative. The more the economy's growth is negative the more people are forced to depend on the government, who gives them money to spend, not moneyto grow. The result is an economic death spiral.

Giving people money for food and clothing does create jobs. The rest you put forward is theory NOT born out by our current economic reality.

Our economy is no longer built on production, it is built upon the idea that growth comes from increases in stock prices. But, ultimately, you have to have production. People buying food equals production. Investing to get 1/2% greater gain often does just the opposite.

OR, do you think the top 1% who has done so very, very well is suddenly going to shift gear and throw all kinds of money down to the rest of us? Hmm... seems like you do think just that.

[Ray Rider]

[ So the type of speding is important. Simply giving people money will not have a Growth Effect on the economy. But it will be taken from money that is being used to create a growth effect. Politicians spend money on their own reeelection so they have no growth effect. Thus you get the equation ... GE(X) << GE(X') or that the net growth effect on the economy is negative. The more the economy's growth is negative the more people are forced to depend on the government, who gives them money to spend, not moneyto grow. The result is an economic death spiral.

Giving people money for food and clothing does create jobs. The rest you put forward is theory NOT born out by our current economic reality.

Our economy is no longer built on production, it is built upon the idea that growth comes from increases in stock prices. But, ultimately, you have to have production. People buying food equals production. Investing to get 1/2% greater gain often does just the opposite.

OR, do you think the top 1% who has done so very, very well is suddenly going to shift gear and throw all kinds of money down to the rest of us? Hmm... seems like you do think just that.

Sometimes I wish the world were as simple as people like Player make it out to be, with the ability to just "give people money" out of thin air, and in a vacuum with no negative effect on the rest of the economy; or "eat the rich," with the "rich" being anyone who makes an arbitrary amount of money more than I do (again, without consideration of the ramifications caused by implementation of such policies). If only all the world's problems were as simple as naive people perceive them to be...

[tzor]

Giving people money for food and clothing does create jobs. The rest you put forward is theory NOT born out by our current economic reality.

I'm reminded of the old line in "It's a wonderful life" ... "Look, I'm making angels!" CA CHING, CA CHING.

Contrary to popular opinion, we are currently spending a ton of money "for food and clothing." SOURCE and yet this does not result in the lowest rate of unemployment. The money is being spent; the cash register bell is ringing non stop but the jobs, like the angels just don't appear.

''Is this the real life? Or is it fantasy, caught in a landslide." Who has the theory that is not born out by our current economic reality.

[PLAYER57832]

Giving people money for food and clothing does create jobs. The rest you put forward is theory NOT born out by our current economic reality.

I'm reminded of the old line in "It's a wonderful life" ... "Look, I'm making angels!" CA CHING, CA CHING.

Contrary to popular opinion, we are currently spending a ton of money "for food and clothing." SOURCE and yet this does not result in the lowest rate of unemployment. The money is being spent; the cash register bell is ringing non stop but the jobs, like the angels just don't appear.

Well, who gets to define "ton of money".

And nice to see how you go from "not impeding production" (BBS article asserted it essentialy did), the claim I refuted to not "resulting in the lowest rate of unemployment"..something I never claimed at all.

Giving food and clothing doesn't significantly IMPROVE employment, true. It can cause a small rise, but the big thing it does is to maintain employment and keeps the slide from going even further down.

Per the money doesn't grow on trees... exactly why we need to tax more heavily those who are making money from indirect sources like stocks and other investments, instead of pretending that plopping money down to generate a profit is some great largess for society. The largess is the millions of work-a-day folks who, despite working 40 hours or more (often at more than one job) cannot pay for rent, food and clothing without assistance... largess to the companies that hire them.. and then try to claim huge tax benefits because they are "generating jobs".

[Night Strike]

Giving people money for food and clothing does create jobs.

We have more people living off food stamps and other governmental welfare than ever before. If your (and Pelosi's) theory is correct, why aren't jobs being created in massive amounts all over the country?

[tzor]

It's time to be BOLD.

Giving people money for food and clothing does create jobs. The rest you put forward is theory NOT born out by our current economic reality.

Contrary to popular opinion, we are currently spending a ton of money "for food and clothing." SOURCE and yet this does not result in the lowest rate of unemployment. The money is being spent; the cash register bell is ringing non stop but the jobs, like the angels just don't appear.

And nice to see how you go from "not impeding production" (BBS article asserted it essentialy did), the claim I refuted to not "resulting in the lowest rate of unemployment"..something I never claimed at all.

I bolded your claim. you claim X creates jobs. We have lots of X but unemployment is high. Unemployment is the result of the net creation or destruction of jobs. Therefore it X creates jobs and we have lots of X then the impact of all that job creation should be to reduce unemployment; but instead it continues to ride. Since unemployment is the sum of all job destruction minus job creation we have to assume, by the power of math and all those lessons I took in differential equations that job creation IS NEGATIVE in spite of all that X. Therefore, you are full of goose manure. It might be light, fluffy and green but it's manure.

Now there is the simple question of why. Elementary, my dear Player. In order to get the money to give people for food and clothing you have to take from someone and that someone was previously busy creating jobs. His job creation was greater than your job creation and as a result the effect is a NET LOSS.

[tzor]

Well, who gets to define "ton of money".

It's a figure of speech. But if you really want to know, the size and weight of a $1 bill is determined by the U.S. Treasury. SOURCE: "It would take 907,184.74 U.S one-dollar bills to make a ton."

Source(s):
http://www.ustreas.gov/education/faq/cu ... n.shtml#q2
http://en.wikipedia.org/wiki/Ton

So I was off by a factor of a thousand; "thousands of tons" doesn't have the same flair.

[PLAYER57832]

Giving people money for food and clothing does create jobs.

We have more people living off food stamps and other governmental welfare than ever before. If your (and Pelosi's) theory is correct, why aren't jobs being created in massive amounts all over the country?

Because "my theory" as you call it never said that giving people food would create all kinds of jobs.

My theory is that giving the big guys even more tax breaks, continuing those we have won't create jobs.. and it seems like that is correct.

[tzor]

Giving people money for food and clothing does create jobs.

Because "my theory" as you call it never said that giving people food would create all kinds of jobs.

So giving people money for food CREATES jobs; giving them food does SQUAT.

Fascinating.

[Timminz]

Giving people money for food and clothing does create jobs.

Because "my theory" as you call it never said that giving people food would create all kinds of jobs.

So giving people money for food CREATES jobs; giving them food does SQUAT.

Fascinating.

What's the difference between those two things? Is there an extra exchange somewhere in one of the options?

[PLAYER57832]

Giving people money for food and clothing does create jobs.

Because "my theory" as you call it never said that giving people food would create all kinds of jobs.

So giving people money for food CREATES jobs; giving them food does SQUAT.

Fascinating.

What's the difference between those two things? Is there an extra exchange somewhere in one of the options?

Yes.

[PLAYER57832]

It's time to be BOLD.

Giving people money for food and clothing does create jobs. The rest you put forward is theory NOT born out by our current economic reality.

Contrary to popular opinion, we are currently spending a ton of money "for food and clothing." SOURCE and yet this does not result in the lowest rate of unemployment. The money is being spent; the cash register bell is ringing non stop but the jobs, like the angels just don't appear.

And nice to see how you go from "not impeding production" (BBS article asserted it essentialy did), the claim I refuted to not "resulting in the lowest rate of unemployment"..something I never claimed at all.

I bolded your claim. you claim X creates jobs. We have lots of X but unemployment is high. Unemployment is the result of the net creation or destruction of jobs. Therefore it X creates jobs and we have lots of X then the impact of all that job creation should be to reduce unemployment; but instead it continues to ride. Since unemployment is the sum of all job destruction minus job creation we have to assume, by the power of math and all those lessons I took in differential equations that job creation IS NEGATIVE in spite of all that X. Therefore, you are full of goose manure. It might be light, fluffy and green but it's manure.

Now there is the simple question of why. Elementary, my dear Player. In order to get the money to give people for food and clothing you have to take from someone and that someone was previously busy creating jobs. His job creation was greater than your job creation and as a result the effect is a NET LOSS.

Ah, well, apparently English is giving you some difficulty.. or just are too set on your ideas to consider what is actually happening..

Giving folks money for food, alone is not enough, of course. And, given the huge mess the big bankers and other investment tycoons have created, it will take a good deal to reverse what we have. Money for food and clothing did help maintain and even create a few jobs, just not enough to offset the huge mess the big guys made. But then, that is not its intent. Its intent is to keep people from starving, heading for crime out of desperation.. or just plain having to take jobs that are way too dangerous, way too underpaid --- except, oops, our minimum wage is so low that people at the lowest levels ARE underpaid.. or at least paid so little that they cannot support themselves (whether that is underpaid or not is a matter of opinion, of course).

But, let's see if your proposals work... hmm... we have given huge tax breaks to the big guys, reduced regulations on the banks, etc and what did we get? The collapse! The wealthiest in this country being the ONLY group that is faring well economically.

The fact is that wealthy they accumulate comes from somewhere. That "somewhere" is the labor of all the "peons" they disdain for "not paying enough taxes". They pay "taxes" all right, its just that the big guys call it "profit"!

[tzor]

But, let's see if your proposals work... hmm... we have given huge tax breaks to the big guys, reduced regulations on the banks, etc and what did we get? The collapse! The wealthiest in this country being the ONLY group that is faring well economically.

"My" proposals. Please don't put proposals in my mouth, I don't know where they have been!

We can argue (I would prefer to discuss rationally but that's never going to happen here) all day as to the cause of the collapse. Yes some regulations were reduced; but some (like the forcing of banks to lend money to high risk people because they were deemed minority status) were incrased. But that is not the point; not evertying that comes from the mouth of a Republican is either conservative or good and I point out that Republicans supported Ethanol subsidies which clearly have been a non-good impact on the economy and the environment.

I'm not sure where this "huge tax breaks to the big guys" comes from. The Bush tax cuts gave a massive middle class tax break; it's one of the reasons why a large number no longer pay net federal income taxes.

Liberals also have no notion that corporate gains is not the same as regular income. So going back to comparing apples with apples and income with income, tell me how Tiger Woods is gaming the system.

Generally speaking, liberals often talk about the rich as earning over $200K; upper middle class in Manhattan (I think they pay school janitors that wage, but that's another strange thing in NYC).

It's also ironic that the company who paid NO CORPORATE TAX, GE, thanks to financial tricks that include shifting profits to failing banking sectors, is a big fan of the current administration.

Did someone say "huge tax breaks to the big guys?"

I'd rather not "steal" money from Tiger Woods and reduce regulations on SMALL BUSINESS. Why do you think the Obama couldn't find any shovel ready jobs? He was hampered by his own regulatory red tape. And if the president of the United States can't create jobs because of red tape, how can small business?

[thegreekdog]

Giving people money for food and clothing does create jobs.

Because "my theory" as you call it never said that giving people food would create all kinds of jobs.

So giving people money for food CREATES jobs; giving them food does SQUAT.

Fascinating.

What's the difference between those two things? Is there an extra exchange somewhere in one of the options?

Yes.

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.

[Night Strike]

Giving people money for food and clothing does create jobs.

We have more people living off food stamps and other governmental welfare than ever before. If your (and Pelosi's) theory is correct, why aren't jobs being created in massive amounts all over the country?

Because "my theory" as you call it never said that giving people food would create all kinds of jobs.

My theory is that giving the big guys even more tax breaks, continuing those we have won't create jobs.. and it seems like that is correct.

Amazing how many times you speak against yourself.

[PLAYER57832]

Giving people money for food and clothing does create jobs.

Because "my theory" as you call it never said that giving people food would create all kinds of jobs.

So giving people money for food CREATES jobs; giving them food does SQUAT.

Fascinating.

What's the difference between those two things? Is there an extra exchange somewhere in one of the options?

Yes.

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.

In fact, if we want to find a place where that dynamic DOES happen, it is much further up the chain.. some middle managers, folks who's sole income is working with investments and such. Many of those actually very much do inhibit production, because they gain money in ways that not only have little to do with production, they actually gain from reducing real production and real employment of others.

This is not to say that all investment is bad, but our current system masks a LOT of waste and encourages the kind of investment that benefits the owners and does not in any way ensure that the owners actually employ people, generate worthwhile products or create anything at all beyond money in their pockets. Its become politically expedient to blame the poor for basically being poor, not having decent jobs.. and to claim that the answer to full employment is to pour more money into the wealthy investors. In truth, that model has never worked in history. The idea of temporarily propping up folks with food and housing, even sem-permanently finding ways to minimally support the very bottom folks (including the elderly, disabled, and yes.. some derelicts), in contrast HAS, historically worked well.

[PLAYER57832]

Giving people money for food and clothing does create jobs.

We have more people living off food stamps and other governmental welfare than ever before. If your (and Pelosi's) theory is correct, why aren't jobs being created in massive amounts all over the country?

Because "my theory" as you call it never said that giving people food would create all kinds of jobs.

My theory is that giving the big guys even more tax breaks, continuing those we have won't create jobs.. and it seems like that is correct.

Amazing how many times you speak against yourself.

Yeah, well the real problem is that that you seem unable to comprehend anything but extremes. Anyone moderate is therefore "refuting" what they said or being hypocritical.

[BigBallinStalin]

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?