I believe this is the ultimate goal of most corporations. It sure would make us competetive with China and India.
well, that and sacrificing one or two states for them to dump all the chemicals and other crap that will kill everyone into
Unless corporations are going to put a maximum wage in place, it won't happen due to the magic of the free market. There's a reason why minimum wage jobs pay minimum wage - it's because they're almost completely fungible.
Christine Lagarde, the IMF's managing director, last week caused consternation among governments that have embarked on controversial spending cuts by arguing that the impact on economic growth may be greater than previously thought. The independent Office for Budget Responsibility implicitly used a "fiscal multiplier" of 0.5 to estimate the impact of the coalition's tax rises and spending cuts on the economy. That meant each pound of cuts was expected to reduce economic output by 50p. However, after examining the records of many countries that have embraced austerity since the financial crisis, the IMF reckons the true multiplier is 0.9-1.7. A 'revision' from 0.5 to an average of 1.3, (Max 1.7)... sounds a bit more than a revision. As the article points out... Former monetary policy committee member Danny Blanchflower said: "In a way, the surprise is that it's taken everybody so long to work it out: Keynes knew it in the 1930s. This is the 'long, dragging conditions of semi-slump', and the multipliers are likely to be larger when you've got banks that aren't lending and you're coming out of the longest recession in 100 years." Many people, (including you and I now I think about it), thought the austerity nonsense was NEVER going to work and was counterproductive so I'm not sure why you're adopting this position, tbh
Er.. don't think so... http://www.paycheck.in/main/salary/minimumwages/himachal-pradesh Looks like they pay $3-6 dollars per DAY in many areas.
I'm not sure what's so confusing here - the IMF has been arguing for a while that austerity is not conducive to growth. They've re-run their numbers (which is what you do in economics) and have come to a conclusion that it's even worse than they've previously thought. How is that a "volte-face"? The point isn't that I disagree with the conclusion, the point is that it's just an updating of the figures not a change in position by the IMF. Here's Blanchard on this subject almost two years ago (http://blog-imfdirect.imf.org/2011/12/21/2011-in-review-four-hard-truths/): "• Third, financial investors are schizophrenic about fiscal consolidation and growth. They react positively to news of fiscal consolidation, but then react negatively later, when consolidation leads to lower growth—which it often does. Some preliminary estimates that the IMF is working on suggest that it does not take large multipliers for the joint effects of fiscal consolidation and the implied lower growth to lead in the end to an increase, not a decrease, in risk spreads on government bonds. To the extent that governments feel they have to respond to markets, they may be induced to consolidate too fast, even from the narrow point of view of debt sustainability. I should be clear here. Substantial fiscal consolidation is needed, and debt levels must decrease. But it should be, in the words of Angela Merkel, a marathon rather than a sprint. It will take more than two decades to return to prudent levels of debt. There is a proverb that actually applies here too: “slow and steady wins the race." That's just a fancy way of saying that "austerity is self defeating and too much of it now is a bad idea." So while I agree with Blanchflower, bear in mind that it's hardly settled in the economics community - your government has taken the completely opposite view.
I think most people found their position rather muddled a couple of years back. Although they've been changing of late, as you say. Worse? A multiplier of 0.5 means that, if the private sector can recover reasonably quickly output won't be too adversely affected. 1.7 means it becomes virtually impossible for the private sector in most developed countries to take up the slack. Well, that's about 10 months ago rather than 2 years but, fair enough. My impression over the past few years is that they backed people like Merkel and Osborne and then went quiet when it became increasingly obvious that it was all going tits up. It's only very recently that they've changed their position to THIS extent. From September 2010, i.e.. about 2 years ago... http://www.guardian.co.uk/business/2010/sep/27/george-osborne-imf-backs-cuts Osborne announced £6bn of spending cuts within a week of becoming chancellor, raised taxes in an emergency budget in June and is preparing the toughest round of cuts since the war in next month's comprehensive spending review. The IMF study said plans to cut public spending and raise VAT to 20% in January were unlikely to slow growth, but it believes the Bank of England should stand ready to pump more money into the economy through quantitative easing should the economy slow more than expected. "The government's strong and credible multi-year fiscal deficit reduction plan is essential to ensure debt sustainability," the IMF said. It advocated the end of universal state benefits and cuts in public sector pay and pension entitlements to bring down record peacetime borrowing, which rose to more than £160bn last year. Of course, we both know that some of that is Osborne blowing smoke up our arses but their statements at the time were undoubtedly in support of his policies. I think the plain truth is that they were papering over their backsides with many of their statements then which were simply contradictory with LeGarde saying one thing and others saying something else.. That's partly why it's so irritating NOW for them to come down on the side many people, (including you, IIRC), SAID was the right side. You don't need to remind me mate
Thanks, I look forward to that. I need to find me a good excuse to go to New York. You make a very good point about the US right now. I agree that the pendulum is swinging too far in the opposite direction, between Bush Jr and now the Tea Party. But having said that I agree with them to the extent that I just don't think we can continue arguing for increasing the role of government in terms of promising the citizens more benefits. I say this because I think it would be foolish to count on the US economy to expand again as it did in the 50s and 60s, and also in the 90s through the turn of the century. That kind of economic expansion was due to specific circumstances and I don't think it's wise to count on it all the time as a matter of course. On the other hand, I do disagree with them in that I realize (for that same reason) that even to keep up with the present role of government there has to be an adjustment in taxation, and I think it has to be a comprehensive adjustment that includes raising taxes for high achievers, and unfortunately also for the middle class, because I think it's important for a healthy economy to pay down the deficit and balance the budget, and it will take more than "the rich" to do it. Now I'm going to be accused of being a liberal myself, but while I don't like taxes, like George Bush Senior did, I think raising taxes at some point is inevitable under the circumstances, and right now I think they are low enough that we have some room to raise them. What I don't like is the way some people are appealing to class hatred in an attempt to use it for political purposes. I also have a problem with people championing the European model as a success that can be replicated here. My belief is that we need to look at economics in the context of history. Europe destroyed itself in the 20th century and then rose from the ashes, so there was unprecedented growth that enabled some nations to do certain things during our generation that I believe in the long term are unsustainable, other than maybe in a few small rich enclaves like Scandinavia. So I think that to try to emulate their model would be foolish.
Well no the model for the PIGS, but some Northern European variation would be better (not Sweden but more like Germany). I do see the USA going more in the way of Germany in terms of government size, tax rates ect. I also see Germany cutting back some to be more like the USA, eventually maybe we will find a balance that works, but that will surely include higher taxes on us all and at least a reduction on the growth of our spending. Infrastructure spending, High speed rail construction, Electrical grid upgrade and invasion of Canada are stimulus government spending I can get behind for sure.
http://www.economist.com/node/21564414 Another similar article from the economist. From the article you posted
Ironic isnt it? The American Right Wing decry embracing the German Governmental model today yet the same strata of society eagerly wanted to do just that in the 1930s.
As someone with an admittedly limited knowledge of financial issues, I found this Op-Ed illuminating if somewhat simplistic. But apparently there's been a small kerfuffle about recent comments from pro golfer Phil Mickelson and his tax rates. This piece lays out a nice contrast between taxing those who earn money -- like Mickelson -- and those who have wealth -- like Mitt Romney. This also relates to recent news items around the massive tax breaks given to money managers who work with capital gains, etc. Mickelson Has a Point on Taxes "....The Mitt-Lefty paradox has a simple explanation: In America, we tax work. And highly. We do not tax capital or wealth much at all. Indeed, if you have wealth already, taxes are essentially optional under what I call tax Planning 101, the simple advice to buy/borrow/die. In step one, you buy assets that rise in value without producing cash, such as growth stocks or real estate. In step two, you borrow to finance your lifestyle. In step three, you die, and your heirs get your assets, tax free, and with a "stepped up" basis that eliminates all capital gains. That's it. Romney, with a personal fortune estimated at $250 million (his five kids have another $100 million) has figured this out. When he pays taxes, at all, he does so at the low capital gains rate. Not so with Lefty. He is a wage-earner, albeit a very highly paid one, and he's going to pay over one-half of his income in taxes if he stays in California. We may not be shedding any tears for Lefty any more than we feel for Gerard Depardieu, who recently left France for Russia to escape taxes, or for the Rolling Stones, who many moons ago left England and recorded Exile on Main Street from France. Yet one fact not making news is that it is still the case that the highest marginal tax rates in America do not fall on the highest incomes, like Lefty, but on certain of the working poor, many of them single parents, who are being taxed at rates approaching 90% as they lose benefits attempting to better themselves. It's a "poverty trap" that works just like the severe marriage penalties for the lower-income classes. But the working poor do not have the options of going to Canada, Russia or France. Lefty has a point -- high tax rates create disincentives. If the rates are high enough, people react by moving. This should not surprise us: American companies have been fleeing our shores for years, in droves. Ask Mitt...."
The only people who can appreciate how much the tax code rewards old, rich slackers who don't do a lick of work are those who are old, rich, and slackers. I'm getting to that point of my life. It's wonderful in a way. I will pay an equal or lower tax rate for doing jackcrap in 2012 than I did at ages 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, and 35. And I made more money pretax in 2012 than all those early years combined. It's horrifying in another way. The system is so rigged for those who already have money. The people who shriek "class warfare" are kicking your ass through class warfare. Take it from me, I'm there. Sorry for the cynicism. I went to a GOP site and realized this is all for the good. I am a "job creator."
Agreed, It pisses me off because I am actually a job creator - and we get no help at all. I pay high tax personally. And then every person I hire - I (my company) pays their tax as well.
I will read you a paradox, my friend. A job creator who is not rich is not a job creator, even though he or she creates jobs. A non-job creator who is rich is a job creator, even though he or she does not create jobs.
Bobby Jindal - Brave talk. So Jitty, you're trying to create jobs. How would the GOP's tax proposals promote you? How is the GOP taking care of you where the Democrats are not?
Ok with you so far. Well you do produce cash to buy the assets right? I guess you can take out a loan to buy the assets, so ok I guess we can say borrow/borrow/die. Borrow to finance your life style? I am not sure what that means can you expand on this point? Maybe you mean borrow money against that appreciating asset. Now while I agree that the inheritance tax is way to low, it should be 50% IMO, I am not sure where he gets the free from? Plus anyone receiving the inheritance would have to pay taxes on the stepped up basis. So I do not think I follow this, if his point is that the family will pay low taxes on the assets they receive, yes I agree, but they must have some very good accountants to get it tax free. (I bet those accountants and lawyers are not cheap). Yes, totally agree, same withWarren Buffet that is why he says he pays less taxes than his secretary (rate wise in total obviously Romney and Buffet pay lots of taxes). And they are free to do so if they want, I mean is not like countries are going to take away the passports of people and hold then under country arrest. Lets see what happens when Russia gets pissed at the guy and trows him in jail for his "free speech". BTW who goes from England to France to avoid high taxes? That sounds like a dumb move. WOW WOW WOW "working poor" being taxed at "90%" rates, who the ******** pays 90% in taxes, I call bullshit in this number and I would stop reading after this. But I will go on. Working poor could go to Mexico. Maybe outsourcing our poor to Central America could work. Giving each poor person in the USA 12K per year would not get them out of poverty. Give the same poor 12K and move them to Guatemala, boom they are upper middle class/almost rich.
Not only that, you bastard (not personal to you ) will take out 3 to 4 times more out of social security that you ever put in, and you will go around screaming that you "deserve" that money, total bullshit!
Are you saying Obama did not create any jobs (Presidents do not I know) before the Bush-Obama taxes expired this January? I remember Clinton talking about 4.5 Million new jobs under Obama (after the economy hit the low point), weren't those jobs under the old lower tax rates. As a matter of fact, most tax rates are still lower today than they were under Clinton, are you saying no new jobs will be created unless we get rid of the full Bush-Obama tax cuts?
You have it pretty much right. I decided at some point in the Reagan-Bush years (it's all a blur) that if everything was going to be tilted in favor of the rich, I should try to be rich, too. Not quite there yet, but not doing too badly. Can't say that I've created any jobs, either.
A similar Op-Ed in the WSJ commented on a number of pro athletes who have moved to Florida from California to avoid paying the Golden State's ridiculous income taxes. Based on their analysis, Mickelson will pay approx $7M more in taxes (based on his most recent annual income) if he stays in California rather than move to a no-income-tax state like Texas or Florida. Tiger Woods left California for Florida when he turned pro and since then has saved somewhere on the order of $100M in taxes. The latest California income tax hikes had a lot to do with my own personal decision to not return there. While Lefty and Tiger will do just fine if they pay California taxes, it makes a significant difference for someone like me.