Wealth Creators.

[elmarko]

Yes, but that wouldn't ever happen. There will always be a sizeable population with money to spend. There is no point talking about impossible hypothetical situations.

I've known plenty of rich people who buy loads of stuff, and rich people who buy nothing.
I've known plenty of poor people who buy loads of stuff, and poor people who buy nothing.

I'm sorry, but you don't know any poor people who buy "loads of stuff" (unless you are counting poor people who are amassing debt).

Unless "loads of stuff" is something which anybody in the UK can afford to buy - in that cause it would be "stuff" - as it would lack a comparative point to be "loads".

 

[estebanrey]

Yes, the gap has grown I'm not denying that. However, we're not going to ever get to a point where 99% can't afford to buy stuff. And, if that does somehow happen then there'll be a market reset. It isn't the governments role to somehow ensure economic equality. Communism is bad, y0.

But the point of the presentation is the government (at least US) ARE doing stuff to ensure the richest in society are paying less tax than the rest of us on the basis that they are 'job creators', that was the whole point of the presentation.

Secondly, it is just silly to suggest or imply that unless you support unregulated, unfettered capitalism you are advocating communism, it's not black and white.

Even Boris Johnson (A Tory) admits his Boris Bikes is a 'communist scheme' that works very well.

 

[UK-AL05]

Should not the markets account for this anyway. The 1% may have a lot of money, but they only consume so much. Obviously the rich should pay the same tax.

The prices in the market will reach equilibrium where the supply can be depleted, which means price of goods has to be in the range of the average consumer, if there's enough supply.

 

[estebanrey]

People have not become any poorer during the last 10 years, 20 years or 30 years.

See here:
http://en.wikipedia.org/wiki/Income_inequality_in_the_United_States#Wage_inequality

under the race and gender section,

and also here: http://acivilamericandebate.wordpress.com/2011/04/10/the-30-year-growth-of-income-inequality/

Wealth ultimately is nothing more than how the finite amount of resources on Earth can be shared out. It is impossible for 'everyone to become richer' in real terms unless the population goes down (which clearly isn't happening) or more resources are discovered somewhere we didn't know about before.

Inflation may make everyone richer numerically, but not in any real sense. I earn a higher number of pounds than I did 10 years ago but I have less spending power.

In the last few years inflation has been rising faster than wage increases which mean people are getting poorer.

Through credit, as you rightly guessed. no one is advocating it but it's a fact. A lot of people were extended, and took it, too much credit. At the first downturn they went under water and they will stay there for a long time. You can't blame one side for this as everyone is responsible.

However, credit is not a bad thing necessarily, it can be very useful if used properly and wisely.

I didn't use the example to blame or make a comment on responsibility for the global recession. I'm simply pointing out that justifying the top 1%'s wages rising at a much higher rate than those at the bottom because poor people can always get credit to maintain the cyclic economic flow is a flawed idea.

All credit has to be paid back eventually so when you give someone credit you've not made them richer overall, you've just made them poorer in the future for the short term increase in funds. Meaning in the future they then have to get more credit to carry on sustaining the economy and eventually they'll reach a point where they simply won't earn enough in there liftetime to ever pay it back.

 

[realBabelfish]

I wouldn't argue it's left or right wing.

His argument wasn't based around "wanting social equality", but more a recognition of the reality that having an impoverished consumer base is bad for any business.


Thanks!, was just a 3 day one .

have you been fascist baiting again?

 

[elmarko]

Secondly, it is just silly to suggest or imply that unless you support unregulated, unfettered capitalism you are advocating communism, it's not black and white.

Indeed, is seems the second somebody has the temerity to suggest a slight rebalance of economic wealth (to enshrine the working classes with a slightly more generous disposable income) - it's akin to them suggesting the government should send a gaggle of men to smash down their door wearing the uniform of the red army, all wielding Stalin moustaches who then begin redistributing their wife to the comrades after raping the family dog.

 

[Basher]

I fully agree, a great presentation. Demand creates jobs not CEOs and as he said it's in a business' interest to keep staff overheads down by as much as possible.

When a robot can replace a human, business will be quick to fire the employee and replace them with tech so when these billionaire business men describe themselves as 'job creators' it is disingenuous. They will only hire more people if the net result is an overall gain for themselves, they don't do it out of the kindness of their hearts.

Who creates the demand? Does a CEO establishing a product in a niche market not help fulfil a demand that perhaps hadn't existed before their company?

Believe it or not, many CEO's actually care about their employees. Many lose sleep over how their decisions will impact the 1,000's that work beneath them.

 

[estebanrey]

Indeed, is seems the second somebody has the temerity to suggest a slight rebalance of economic wealth (to enshrine the working classes with a slightly more generous disposable income) - it's akin to them suggesting the government should send a gaggle of men to smash down their door wearing the uniform of the red army, all wielding Stalin moustaches who then begin redistributing their wife to the comrades after raping the family dog.

 

[realBabelfish]

Indeed, is seems the second somebody has the temerity to suggest a slight rebalance of economic wealth (to enshrine the working classes with a slightly more generous disposable income) - it's akin to them suggesting the government should send a gaggle of men to smash down their door wearing the uniform of the red army, all wielding Stalin moustaches who then begin redistributing their wife to the comrades after raping the family dog.

the thing is. if 99% of people are better off then they have more money to spend and we would all be better off!

 

[estebanrey]

Who creates the demand? Does a CEO establishing a product in a niche market not help fulfil a demand that perhaps hadn't existed before their company?

Society creates the demand, the CEO creates the supply to meet it.

Apple are probably one of the only companies that can claim to 'create' demand by convincing us we need stuff we've never thought we needed before but the vast majority of products are invented to fulfil a need or want that already exists but no one is catering for.

Believe it or not, many CEO's actually care about their employees. Many lose sleep over how their decisions will impact the 1,000's that work beneath them.

I'm sure some do and I'm sure they feel bad when they have to make people redundant but they don't put it off either. The nature of competitive business simply doesn't allow a CEO keep people on out of kindness if it means a lower overall profit at the end of the day.

And I'd wager far more people at the top describe their workers in cost terms rather than human terms (as an 'overhead' for example).

 

[mmj_uk]

I still believe that the current economic crisis has been manufactured to bring about a Proletarian revolution, you see signs everyday that the working class are being made to wake up to the exploitation by the Bourgeoisie, or as we know it the "1%".

Lets face it the current economic system is unsustainable in the long term and people are not going to accept Communism at gun point.

 

[elmarko]

Who creates the demand? Does a CEO establishing a product in a niche market not help fulfil a demand that perhaps hadn't existed before their company?

Believe it or not, many CEO's actually care about their employees. Many lose sleep over how their decisions will impact the 1,000's that work beneath them.

Fulfilling an existing demand isn't the same as creating it.

You can have demand without the business (unfulfilled demand), but you can't have demand without the customers.

CEO's will not employ people if they don't need to.

But it is worth making a distinction between a business which is owned by shareholders & one owned by a singular entity - the latter at least has the possibility of having a benevolent dictator.

 

[Basher]

Fulfilling an existing demand isn't the same as creating it.

You can have demand without the business (unfulfilled demand), but you can't have demand without the customers.

CEO's will not employ people if they don't need to.

But it is worth making a distinction between a business which is owned by shareholders & one owned by a singular entity - the latter at least has the possibility of having a benevolent dictator.

No, but plenty of businesses create demand.

Both have the possibility of benevolent leaders. I've worked with CEO's run by PE organisations who worry greatly abut the employment of their staff.

Whilst I appreciate that staff (CEO's included) are only there to make the shareholders money, it's somewhat short sighted for the leadership team to not care about how they are treated.

 

[elmarko]

the thing is. if 99% of people are better off then they have more money to spend and we would all be better off!

More importantly also, the evidence also suggests our society would be a far more pleasant place to live.

With reductions in crime, increased life-span, reduced health problems (physical & mental), greater social cohesion - the list is endless.

Another key benefit would be a sharp reduction in unemployment - as assuming the disposable income increased for a good percentage of the population would certainly yield a significant increase in demand for goods & services.

I can't think of an industry which would be worse off as a result of the population having a greater disposable income (apart from loan sharks & predatory businesses which take advantage of the economically unstable).

It's hardly an idea right out of the Grundrisse, just a few sensible & moderate alterations to our existing system.

 

[elmarko]

No, but plenty of businesses create demand.

Both have the possibility of benevolent leaders. I've worked with CEO's run by PE organisations who worry greatly abut the employment of their staff.

Whilst I appreciate that staff (CEO's included) are only there to make the shareholders money, it's somewhat short sighted for the leadership team to not care about how they are treated.

The statistics regarding the disparity between the increases in pay for CEO's & increases for the lowest earners in said organisations imply's otherwise.

Feeling bad about sacking staff to reduce overheads (but dong it anyway) doesn't make them philanthropists.

Besides, finding one example against the average/trend isn't evidence against the trend - just that exceptions exist.

But the data suggests it's just that - exceptions.

 

[realBabelfish]

More importantly also, the evidence also suggests our society would be a far more pleasant place to live.

With reductions in crime, increased life-span, reduced health problems (physical & mental), greater social cohesion - the list is endless.

Another key benefit would be a sharp reduction in unemployment - as assuming the disposable income increased for a good percentage of the population would certainly yield a significant increase in demand for goods & services.

I can't think of an industry which would be worse off as a result of the population having a greater disposable income (apart from loan sharks & predatory businesses which take advantage of the economically unstable).

It's hardly an idea right out of the Grundrisse, just a few sensible & moderate alterations to our existing system.

oddly you would probably see the rich still doing well as more cash = more money to spend and therefore bigger profits. the problem is the super rich are often super selfish too.

elmarko1234 - you are a bright guy. cant you buy an island and let us have a go at a small utopia? hehe

 

[ntg]

Wealth ultimately is nothing more than how the finite amount of resources on Earth can be shared out. It is impossible for 'everyone to become richer' in real terms unless the population goes down (which clearly isn't happening) or more resources are discovered somewhere we didn't know about before.

That definition is completely arbitrary and has no economic basis. By that idea we have been getting poorer since the dawn of time when there only a handful of humans walking the earth.

Earth has more resources than we've managed to use in millions and years and will have more for millions to come.There are enough resources to cater for plenty more people on this earth. More resources are being discovered (or financially affordable to extract) all the time. Just look at the shale gas boom and the implications of it.

It is most definitely possible for everyone to become richer due to economies of scale at a national level. When GDP is growing then the average Joe is becoming richer indeed. For illustrative purposes, just look at the western world for starters, or look at Russia and compare it to where it was a few decades ago, or Europe during and post-WW2.

There are many people today doing worse jobs than their fathers, yet they are able to offer their offsprings a much higher quality of life. That goes against your theory on the world getting continuously poorer.
[/quote]

Inflation may make everyone richer numerically, but not in any real sense. I earn a higher number of pounds than I did 10 years ago but I have less spending power.

I believe the figures in the charts are net of inflation, hence everybody has got richer in real terms, not in absolute terms.

In the last few years inflation has been rising faster than wage increases which mean people are getting poorer.

Are you certain about that? I have a different view, I'll try to find some sources.

 

[bam0]

I still believe that the current economic crisis has been manufactured to bring about a Proletarian revolution, you see signs everyday that the working class are being made to wake up to the exploitation by the Bourgeoisie, or as we know it the "1%".

Lets face it the current economic system is unsustainable in the long term and people are not going to accept Communism at gun point.

Interesting idea, but if it's being manufactured, who is doing it and for what purpose? In our current system you need power to effect something like this, and that power would largely come about through wealth. So there are some fantastically wealthy, powerful but altruistic people out there pulling strings to engineer a communist revolution that it liable to remove their power and wealth? Turkeys voting for xmas?

 

[elmarko]

I don't believe it's being manufactured, it's just one of the flaws of capitalism.

The people who benefit from the current system are unable to reign in short-term greed, regardless of the long term consequences.

Mainly because the effect of these consequences won't be felt until they are dead & they are also able to pass on enough wealth to their off-spring to ensure they are protected from any of the negative side-effects.

People only tend to care about consequences which will certainly happen during their life, or ones which they are unable to protect their children from.

As somebody earlier mentioned, governments are just as guilty of this kind of short term thinking - the entire concept of voting in leaders ensures that only problems which can be fixed within one term will get any significant attention, not to mention the tendency for whoever comes into power next to scrap any ideas which are meant to benefit in the long term.

 

[estebanrey]

That definition is completely arbitrary and has no economic basis. By that idea we have been getting poorer since the dawn of time when there only a handful of humans walking the earth.

Earth has more resources than we've managed to use in millions and years and will have more for millions to come.There are enough resources to cater for plenty more people on this earth. More resources are being discovered (or financially affordable to extract) all the time. Just look at the shale gas boom and the implications of it.

It is most definitely possible for everyone to become richer due to economies of scale at a national level. When GDP is growing then the average Joe is becoming richer indeed. For illustrative purposes, just look at the western world for starters, or look at Russia and compare it to where it was a few decades ago, or Europe during and post-WW2.

There are many people today doing worse jobs than their fathers, yet they are able to offer their offsprings a much higher quality of life. That goes against your theory on the world getting continuously poorer.

Right, so you believe the only reason there is starvation in some parts of Africa and Asia is solely down to economics/money and not because there aren't enough resources on Earth to go round?

I urge you to watch David Attenbrough's 'How Many People Can Live on Planet Earth?' programme. Here is the first part of 6....

He estimates that for everyone to live to the same standard of living as an Average American, the Earth could only sustain 1 billion people. Likewise if we (the 7 billion alive today) were to all share the resources equally (global communism) the standard of living in Western countries would have to drop dramatically.

Money is a man man concept and is nothing more than a temporary IOU to take a portion of the Earth resources and everything is relative. When people in the UK become 'richer' it has to mean that an equal amount of 'wealth' is lost elsewhere in the world (by wealth I mean the ability to obtain the Earth's resources).

We have nice lives in the West at the expense of the poorer countries, don't tell yourself it's just an economic thing and they could catch up with us without out standard of living dropping here at the same time.

Yes, some resources are sustainable but many aren't. There is only so much land on Earth suitable to grow crops or farm animals, oil is an obvious finite resource as well. If the whole world became 'first world' over night how much quicker do you think we'd get through the reserves for example?