Quote :

"But hey, I guess they shoulda had a better job, right? "

They should work whever they want to. It isnt up to you or I to determine what a better job is, that is a personal decision. Some people LOVE their jobs and make little money but are much happier than a higher earner who hates theirs. They both have made their own decisions and can change their priorities at anytime.

There is nothing wrong with someone who chooses recreation over money. If they want to work parttime, have enough cash to get by, and spend the rest of their time fishing or playing in a band. Whatever makes them happy. Just as someone who values money over recreation. They work 7 days a week. Never take a vacation in order to earn more money. Great, another personal choice based on their values. The problem is when govt now wants to take from the worker to give to the part time worker against his will. That violates his liberty and is wrong. They have made their choices each has their own benefits and sacrifices, let them both live with those.

5/21/2011 9:37:35 AM

Quote :

"Actually studies show that the lower income earners are better savers on average. Correlation between income and wealth With doctors having a high propensity to be a UAW as evidence, there is an indirect relationship between the level of income an individual earns and the net wealth that one accumulates. Doctors have a reasonably high level of income; therefore, it is more likely that doctors have relatively low amounts of net worth. The same holds true for those that have lower levels of income. They are more likely to accumulate more in relation to their level of income."

Too bad absolute dollars pays the rent and puts food on the table. Percentage of income does not.

Quote :

"They have made their choices each has their own benefits and sacrifices, let them both live with those."

You seem to believe that anyone in an adverse situation is there solely by their own choice; externalities have no influence on one's existence. Let me guess: you're one of those bootstrap type of guys. Hard jaw line, cleft chin, silver eyes, etc. I hope you realize that some work 7 days a week and never take vacations not in order to make more money, but rather to make enough money.

Do you receive any benefit from those who work for low wages?

[Edited on May 21, 2011 at 10:13 AM. Reason : ]

5/21/2011 10:12:44 AM

Quote :

"Actually studies show that the lower income earners are better savers on average."

It is perhaps marginally possible that might be true between doctors and teachers, and it probably has to do with the distinction between marginal propensity to consume temporary versus permanent income, however the statement you made is NOT EVEN CLOSE to true.
It is directly contradictory to everything we know about induced consumption. The fact is that as people make more money, they spend a smaller percentage of it.

"consumers tend to spend a smaller percentage of their disposable income as it rises, creating a curved effect at higher income levels"
http://www.investopedia.com/terms/c/consumptionfunction.asp

Now I'm sure you'll have some unsubstantiated disagreement with this, but I have yet to hear a good argument against the fundamental psychological law as defined in the "General Theory".

5/21/2011 10:27:08 AM

Quote :

"the fundamental psychological law as defined in the "General Theory"."

5/21/2011 11:05:23 AM

You always act like you read Keynes and know all this stuff about economics.

http://en.wikipedia.org/wiki/Fundamental_psychological_law
http://en.wikipedia.org/wiki/The_General_Theory_of_Employment,_Interest_and_Money

5/21/2011 11:26:51 AM

I don't think I act like I've read Keynes. It just isn't high enough up on my interest list. I have read people that have read Keynes though and I guess if his prescriptions for economies actually worked then I'd probably be a little more interested to read him directly. Well, that and if I thought that humans could actually control such a chaotic system to a range of reasonable outcomes (hint - we can't) then I'd study him more.

5/21/2011 11:35:33 AM

Quote :

"I guess if his prescriptions for economies actually worked then I'd probably be a little more interested to read him directly"

How would you know what they are? The fundamental psychological law and marginal propensity to consume are not "prescriptions for economies", they are pretty well accepted economic concepts that few economists would argue against. For example, while I disagree with Hayek about many things, I would certainly not argue against the concept of price signals.

Quote :

"Well, that and if I thought that humans could actually control such a chaotic system to a range of reasonable outcomes (hint - we can't) then I'd study him more"

Again, your lack of study has been filled in false preconceived notions. I have never read Keynes suggest such a thing.

I have always assumed you had read Keynes by the way you so matter of factly write him off, I always assumed that only a fool would blindly assume something he hadn't heard to be false, and I gave you more credit than that.

[Edited on May 21, 2011 at 11:47 AM. Reason : ]

5/21/2011 11:44:52 AM

Quote :

"How would you know what they are?"

Because other (armchair or otherwise) economists and virtually anyone that discusses economics on a macro/policy level talks about it.

Quote :

"Again, your lack of study has been filled in false preconceived notions. "

These aren't "notions". These are observations.

Quote :

"I have never read Keynes suggest such a thing."

How hasn't he given his prescription for unprecedented government intervention in an economy.

Quote :

"I have always assumed you had read Keynes by the way you so matter of factly write him off"

Based on my own observations if I had to one line summarize my ideology it would be Hayeks comment

Quote :

"The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design."

5/21/2011 11:58:38 AM

Quote :

"Because other (armchair or otherwise) economists and virtually anyone that discusses economics on a macro/policy level talks about it."

They generally talk about the more contentious issues, marginal propensity to consume is not one of them. Things I have read like that have mentioned it in passing, but it's generally assumed that one would already understand the concept.

Quote :

"These aren't "notions". These are observations."

'

What did you observe? The things you have said have CLEARLY been made up.

Quote :

"How hasn't he given his prescription for unprecedented government intervention in an economy."

He really argues for more of a balance between the two, for government to be more of a "bridgemaker" rather than a driver. You seem to be confusing him with Marx, but even he didn't really focus on that aspect of it. It doesn't really surprise me that you think of Keynes this way, I imagine if all one knew of Keynes was what they read in Reason Magazine, they would probably think of him as the same boogeyman as you.

But all of these are irrelevant. Both concepts that I referenced are not contentious or hotly debated issues, they would better be described as "accepted as fact". I took special care in my earlier post not to mention Keynes by name to avoid having this very debate.

Quote :

"Based on my own observations if I had to one line summarize my ideology it would be Hayeks comment"

What does your ideology or your misunderstanding of Keynes have to do with what I was talking about? You have throughly derailed the thread with your ignorance, I do not mean to be rude by saying that, but it is true.

[Edited on May 21, 2011 at 12:32 PM. Reason : ]

5/21/2011 12:25:57 PM

Quote :

"He really argues for more of a balance between the two"

A balance with more government intervention than we even have today (hard to imagine but true), making the statement "unprecedented government intervention" true.

5/21/2011 12:56:04 PM

Quote :

"A balance with more government intervention than we even have today"

In the US? Additionally I believe it's tough for you to speak for a dead man's opinion of today's political and economic systems.

5/21/2011 1:17:08 PM

Quote :

" It is perhaps marginally possible that might be true between doctors and teachers, and it probably has to do with the distinction between marginal propensity to consume temporary versus permanent income, however the statement you made is NOT EVEN CLOSE to true. It is directly contradictory to everything we know about induced consumption. The fact is that as people make more money, they spend a smaller percentage of it"

You two are using two different definitions of saving and spending.

As its usually defined by the government and economists, savings is different from investment and investment spending is not necessarily the same as consumption. So lower income workers can both save and consume more than higher income workers without it being a contradiction. Example, if that doctor goes and buys a second house to use as rental property its not what the government would measure as savings even though it makes life after a layoff significantly easier.

5/21/2011 3:36:30 PM