renner@uiucdcs.UUCP (renner ) (04/04/84)
#R:mit-eddi:-152700:uiucdcs:29200118:000:1389 uiucdcs!renner Apr 3 18:19:00 1984 /**** uiucdcs:net.politics / mit-eddi!lkk / 10:24 pm Apr 2, 1984 ****/ > All of you people who are so upset that you have to pay taxes on what > you have earned to support others are being both shortsighted and > ignorant. The real reason for paying for college educations is not > because its "a nice thing to to". Rather, it is a socially necessary > requirement of our society to have a large force of well trained > workers. If people are unable or unwilling to go to school, our entire > country will suffer. The same is true for all social programs. > Welfare, for instance, stimulates the economy by allowing people to > consume more. If all those people on welfare were starving to death > instead, demand in the economy would be lower and we would be in an even > worse recession. Welfare does not "stimulate the economy." Welfare simply transfers consumer goods to those who produce nothing. The demand for consumer goods does increase, but there is no particular economic virtue in this. Any resources used are then not available for productive uses; the net result is a drain on the economy. Most authors in the student support discussion are not opposed to paying taxes to support education. They are irritated that some students think they are *entitled* to their free education. There is a difference. Scott Renner {ihnp4,pur-ee}!uiucdcs!renner
tac@teldata.UUCP (Tom Condon) (04/06/84)
, (sop to the blank line eaters--consider it a religious sacrifice) /**** uiucdcs:net.politics / mit-eddi!lkk / 10:24 pm Apr 2, 1984 ****/ > All of you people who are so upset that you have to pay taxes on what > you have earned to support others are being both shortsighted and > ignorant. The real reason for paying for college educations is not > because its "a nice thing to to". Rather, it is a socially necessary > requirement of our society to have a large force of well trained > workers. If people are unable or unwilling to go to school, our entire > country will suffer. The same is true for all social programs. > Welfare, for instance, stimulates the economy by allowing people to > consume more. If all those people on welfare were starving to death > instead, demand in the economy would be lower and we would be in an even > worse recession. Not only does welfare not stimulate the economy as several respondents to this have commented, but it also removes many people from the role of potentially productive workers into the ranks of the overhead bureaucracy which provides the welfare, and whose salaries must come out of the moneys collected for the purpose of providing that welfare. It turns out to be counter-productive in several ways. I will furnish upon request some statistics about how inefficient it is. From the Soapbox of Tom Condon {...!uw-beaver!teltone!teldata!tac} A Radical A Day Keeps The Government At Bay.
nrh@inmet.UUCP (04/06/84)
#R:mit-eddie:-152700:inmet:7800078:000:3781 inmet!nrh Apr 6 01:14:00 1984 >***** inmet:net.politics / mit-eddie!lkk / 5:39 pm Apr 4, 1984 >All of you people who are so upset taht you have to pay taxes on what >you have earned to support others are being both shortsighted and >ignorant. The real reason for paying for college educations is not >because its "a nice thing to to". Rather, it is a socially necessary >requirement of our society to have a large force of well trained >workers. If people are unable or unwilling to go to school, our entire >country will suffer. If indeed it is "necessary", it means that it will be profitable for people to train new workers. You may have heard of apprenticeship programs. Many of these are now impractical because of minimum wage requirements. You think people will suffer? Tell a black teenager (48% unemployment in 1982, 50% unemployment in June of 1983, according to the World Almanac). If indeed it is "socially necessary", it seems to me that we can arrange for a lot of on-the-job training -- just repeal the minimum wage. >The same is true for all social programs. Oh? Does that include the "Comprehensive Employee Training Act (CETA)"?, The Chrysler bailout? Paying farmers NOT to grow wheat? Paying farmers extra to grow tobacco and then requiring warnings against cigarette smoking? >Welfare, for instance, stimulates the economy by allowing people to >consume more. If all those people on welfare were starving to death >instead, demand in the economy would be lower and we would be in an even >worse recession. The "trickle-up" theory! I don't argue that people on welfare do not participate in our economy. Such people, though, are more the pawns of our government than participants in a free society. By making their welfare payments contingent on arbitrary rules we put terrific stress on their families (remember Aid to Families with Dependent Children (AFDC)?), limit what sort of work would be profitable to them (who will work for less than they make on welfare?) and in general put them at the mercy of beaurocrats. If indeed, the alternative to backing "all social programs" was the "all those people on welfare" were to starve, there'd be a real dilemma. Happily, that is NOT the only alternative. Repeal the minimum wage! Those people would be productive in ECONOMIC ways, and demand in the economy would be HIGHER! (To say nothing of higher employment). >For those of you who say, "I worked for it, its mine." Tell me if you >could have earned what you did without the existence of a society which >provides the frame work for your employment. I doubt I could -- BUT! That our society HAPPENS to be the framework in which we made THAT particular salary doesn't mean that its government is therefore entitled to keep any particualar percentage of that salary -- after all, I could as easily complain that our society, by not being sufficiently free, RESTRICTED my salary, and owes me lots more money! Remember -- the alternative to the current mess is not necessarily continual rioting and war -- there are MANY alternatives. >No producetion in a modern >industrial society exists in a vacuum. We are all interedependent and >to claim that you alone are responsible for the value created by your >work is missing the lareger picture. Certainly if I write a program, I share the credit for the final product with the people who wrote the OS, who built the computer, who decided to pay me to write the program, and so on. Nonetheless, the particular value created by MY work (which is only a portion of the final product) is indeed my property. I'm a programmer: my employer pays me a salary to write programs -- my employer (to put it another way) has agreed to pay me a regular salary in exchange for the sporadic value created by my work.
notes@iuvax.UUCP (04/09/84)
#R:mit-eddi:-152700:iuvax:2000020:000:666 iuvax!unix68 Apr 8 17:25:00 1984 [] Your argument that government does not stimulate the economy by giving money to people (Financial Aid, Unemployment Insurance, etc.) is incorrect. By taking idle money from the wealthy (money invested in some form of savings) which creates no aggregate demand and giving it to people who will (because of lack of money) need to spend it on goods and services, you will increase aggregate demand and the money will be cycled back to the public in the form of goods payed for. This line of reasoning is another virtue of taxing the wealthy more heavily: to put idle money to use. -- James Conley Indiana University at Bloomington ...iuvax!jec
renner@uiucdcs.UUCP (04/11/84)
#R:mit-eddi:-152700:uiucdcs:29200125:000:1386 uiucdcs!renner Apr 10 19:25:00 1984 /**** uiucdcs:net.politics / iuvax!notes / 6:42 pm Apr 9, 1984 ****/ > Your argument that government does not stimulate the economy > by giving money to people (Financial Aid, Unemployment Insurance, etc.) > is incorrect. By taking idle money from the wealthy (money invested in > some form of savings) which creates no aggregate demand and giving it > to people who will (because of lack of money) need to spend it on goods > and services, you will increase aggregate demand and the money will > be cycled back to the public in the form of goods payed for. This line > of reasoning is another virtue of taxing the wealthy more heavily: to > put idle money to use. Don't they teach basic macroeconomics to undergraduates any more? If they do, then where does the myth that increased consumer demand is beneficial to the economy come from? It is capital investment -- what Mr. Conley sees as "idle money" -- that strengthens the economy, by increasing the capacity to produce goods. Government income transfer programs take money from those who produce and give it to those who do not, thereby increasing demand without increasing production. Welfare may be a fine humanitarian thing -- though if it is so fine, why the need to force people to contribute? -- but as an economic policy it is basically counterproductive. Scott Renner {ihnp4,pur-ee}!uiucdcs!renner
tac@teldata.UUCP (Tom Condon) (04/12/84)
, (sop to the blank line eaters--consider it a religious sacrifice) >> Subject: Re: YOU EARNED IT??? - (nf) >> Message-ID: <302@iuvax.UUCP> >> Date: Mon, 9-Apr-84 22:06:04 PST >> Sender: notes@iuvax.UUCP >> Organization: Indiana University >> >> [] >> Your argument that government does not stimulate the economy >> by giving money to people (Financial Aid, Unemployment Insurance, etc.) >> is incorrect. By taking idle money from the wealthy (money invested in >> some form of savings) which creates no aggregate demand and giving it >> to people who will (because of lack of money) need to spend it on goods >> and services, you will increase aggregate demand and the money will >> be cycled back to the public in the form of goods payed for. This line >> of reasoning is another virtue of taxing the wealthy more heavily: to >> put idle money to use. >> >> James Conley >> Indiana University at Bloomington >> ...iuvax!jec Now admittedly I am not one of the wealthy (financialy), but I feel that you do not get to be rich by having idle money. That "idle" money is working every second of the time. Sometimes it is doing two or three things as once. The "wealthy" *INVEST* that money; either in banks--which then have money to lend--or in corporations (either through purchase or stocks and bonds)-- which then have growth capital (creating new job positions). They *VERY SELDOM* leave their money just lying around. Before you fly off of the handle let me say that I feel the wealthy do not pay their share of the taxes, but the main reason is that they have invested it in the tax shelter loopholes so wisely left in by the congress for just that purpose. Now if they (congress) are going to leave those loopholes in (and is there any doubt about that?) then any taxation increase to "stimulate the economy" is going to bear directly on the middle and upper-middle classes. I would like to see your definition of "aggregate demand". The demand for the goods was always there (the people have to eat, whether they have money or not), the only difference is the VALUE of the demand--the previous demand was for the product at a lower price. Under true free enterprise the supply and demand would adjust the price down to the available purchase price. This system has been modified by artificial shortages (pay a farmer not to plant) and artificial limits (price limits both top and bottom, and wage limits) as well as a plethora of other "regulated" values which serve to screw up the economy. Standing on my Soapbox and waiting to hear from you, Tom Condon {...!uw-beaver!teltone!teldata!tac} A Radical A Day Keeps The Government At Bay.
lkk@mit-eddie.UUCP (Larry Kolodney) (04/13/84)
From renner: >Don't they teach basic macroeconomics to undergraduates any more? If they >do, then where does the myth that increased consumer demand is beneficial to >the economy come from? --- Well, I happen to be taking a course in Macroeconomics this term, and the first thing they teach us is that an increase in demand has the following effect on GNP: (DELTA)Y=(ALPHA)*(DELTA)(ABAR), where (DELTA)Y= change in GNP, (DELTA)ABAR is change in autonomous spending (in this case due to govt. spending) and (ALPHA) is a constant called the multiplier. Of course the complete model is much more complex and takes such things as rising interest rates and investment into acct. But these only ask whether govt. spending is the most efficient way to increase gnp. The relationship does still exist. -- Larry Kolodney (The Devil's Advocate) (USE) ..decvax!genrad!mit-eddie!lkk (ARPA) lkk@mit-mc
notes@iuvax.UUCP (04/15/84)
#R:mit-eddi:-152700:iuvax:2000030:000:498 iuvax!unix68 Apr 14 17:03:00 1984 I also suspect that renner's argument is assuming that industry is running at full potential. The capital investment that is needed to move the economy forward is indeed necessary to maintain GNP since capital depreciates. However, I don't think the U.S. is marginally close to full production. I also don't think firms want to invest currently because of lack of demand rather than lack of funds to invest. -- James Conley Indiana University at Bloomington ...iuvax!jec
tac@teldata.UUCP (04/17/84)
, (sop to the blank line eaters--consider it a religious sacrifice) >> From: lkk@mit-eddie.UUCP (Larry Kolodney) >> >> >From renner: >> >Don't they teach basic macroeconomics to undergraduates any more? If they >> >do, then where does the myth that increased consumer demand is beneficial to >> >the economy come from? >> --- >> Well, I happen to be taking a course in Macroeconomics this term, and >> the first thing they teach us is that an increase in demand has the >> following effect on GNP: >> >> (DELTA)Y=(ALPHA)*(DELTA)(ABAR), >> >> where (DELTA)Y= change in GNP, (DELTA)ABAR is change in autonomous >> spending (in this case due to govt. spending) and (ALPHA) is a constant >> called the multiplier. Of course the complete model is much more >> complex and takes such things as rising interest rates and investment >> into acct. But these only ask whether govt. spending is the most >> efficient way to increase gnp. The relationship does still exist. >> -- >> Larry Kolodney >> (The Devil's Advocate) >> The problem Larry is that (DELTA)ABAR can only be positive if the government pumps money in from nowhere. If they take $10000000000000000000. in and hand out all but $.01 there is loss in the system and (DELTA)ABAR has been decreased. Now if you would like some statistics on just how efficient they really are.... From the Soapbox of Tom Condon {...!uw-beaver!teltone!teldata!tac} A Radical A Day Keeps The Government At Bay.