Socialism - Should we be worried

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Maddy
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Re: Socialism - Should we be worried

Post by Maddy » Fri Mar 10, 2023 7:13 am

When my mother was first getting started, it was common for single people to live in a boarding house. A room with a shared bath and hotplate (if allowed) was the norm. Apparently boarding houses are making a comeback as a commonsense solution to the so-called housing crisis. However, by the looks of things it will take some major shifts in thinking before young people--many still intent upon that $400,000 "starter home"--will have anything to do with them.

https://www.technocracy.news/boarding-h ... zed-again/
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Re: Socialism - Should we be worried

Post by vnatale » Fri Mar 10, 2023 8:15 am

glennds wrote:
Thu Mar 09, 2023 2:07 pm

vnatale wrote:
Thu Mar 09, 2023 1:09 pm

glennds wrote:
Thu Mar 09, 2023 12:10 pm

vnatale wrote:
Thu Mar 09, 2023 11:59 am



But the same goes for the median income? [In 2020, Franklin County, MA had a population of 70.5k people with a median age of 47 and a median household income of $61,198.]

Therefore isn't the issue you have been discussing ratio of [House / Income]?


Where you live might be a good place for a young person to get a start. If job and career opportunities are good there and housing is affordable in relation to wages, then it supports what a point I think Maddy makes above.


However, even this area has seen the same wild price increases in house values.

As recently as January 2022 Zillow had my house valued at $131,500. Just 7 months later in August 2022 it hit an all-time high of $209,600. About a 60% increase, which is what seemed to have happened everywhere else in this county. Therefore, the only salvation for many low earners in this county is for the prime rate to continue to climb which will correspondingly drive down the prices of houses.

Think about that. It took 40 years to appreciate $100,500. And then another $78,100 of appreciation in seven months. Talk about a hockey stick!

By the way, have you done a return calculation? I think the August 2022 number might be an aberration, so going by the January number of $131,500 and a 1982 acquisition price of $31,000, it would be about a 3.7% return minus aggregate interest (unless you paid all cash), property taxes, major repairs, renovations, and when you sell it, selling costs.
So housing may be more affordable in your county, but as a path to wealth creation it may not be that lucrative. This is the paradox where housing is more expensive in a place like say, Austin, but in the rear view mirror, places like Austin, Phoenix, Nashville have been seen much more appreciation than "affordable" locations out in the country.

BTW, not trying to criticize your house purchase or make you feel bad about the return Vinny. I'm in same boat or worse in more than one instance.


Never did a return calculation as I never looked at my house as an investment but a place to live. And, in line with my super frugral lifestyle, a place that would be inexpensive to live in. I've known that over the long run the return on house prices were not anywhere close to what people perceived them to be. I was always far more interested in financial investments as opposed to a "house" investment.

I did pay cash for the house. I had saved $15,000 and my father gave me $15,000. So while there was no interest paid there was an opportunity cost for investing that money in the house and not investing it elsewhere.

On the other hand at the same time I was looking at my house I was also looking at another house a few miles from my house. It's selling price was $52,000 but had a VA assumable mortgage with it that really made the house selling price about $45,000 (taking into account the difference in current mortgage rates and that assumable mortgage rate). I think that house is now worth about $450,000? Just another example of when making investments in real things it is the more expensive one that is most likely to have greater appreciation.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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Re: Socialism - Should we be worried

Post by glennds » Fri Mar 10, 2023 3:15 pm

Xan wrote:
Thu Mar 09, 2023 11:37 am



Would you rather the poor be poorer, so long as the rich are worse off?
https://www.youtube.com/watch?v=pdR7WW3XR9c
This was actually pretty thought provoking. I watched the video twice and then thought about it more during an evening walk (I know, get a life).
If I am understanding what Maggie said, the differential gap between the poor and rich is essentially fixed. If you make one lower, by default the other is proportionately lower and vice versa if higher. I get a picture in my mind of a statistical distribution that is fixed. The number scale may go higher or lower, but the distribution never changes. I think she demonstrated it herself by moving her hands up and down, keeping the gap fixed.

Thus for the poor to do better the rich HAVE to do better and likewise if the rich do worse, then the poor will HAVE to do worse. The gap cannot narrow (or widen I suppose). And so she reaches the conclusion that the poor will be poorer if the rich are worse off.
Is that what she's saying?
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Re: Socialism - Should we be worried

Post by Xan » Fri Mar 10, 2023 3:36 pm

glennds wrote:
Fri Mar 10, 2023 3:15 pm
Xan wrote:
Thu Mar 09, 2023 11:37 am



Would you rather the poor be poorer, so long as the rich are worse off?
https://www.youtube.com/watch?v=pdR7WW3XR9c
This was actually pretty thought provoking. I watched the video twice and then thought about it more during an evening walk (I know, get a life).
If I am understanding what Maggie said, the differential gap between the poor and rich is essentially fixed. If you make one lower, by default the other is proportionately lower and vice versa if higher. I get a picture in my mind of a statistical distribution that is fixed. The number scale may go higher or lower, but the distribution never changes. I think she demonstrated it herself by moving her hands up and down, keeping the gap fixed.

Thus for the poor to do better the rich HAVE to do better and likewise if the rich do worse, then the poor will HAVE to do worse. The gap cannot narrow (or widen I suppose). And so she reaches the conclusion that the poor will be poorer if the rich are worse off.
Is that what she's saying?

I don't think she's concluding that the poor will by necessity be poorer if the rich are worse off. She's saying that it's disingenuous to complain about a gap at a time when poor people are being made wealthier. To look at a poor person doing better than he was before and then complain about the situation is to wish that poor person were worse off, as long as somebody else is MORE worse off.
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Re: Socialism - Should we be worried

Post by vnatale » Fri Mar 10, 2023 3:38 pm

glennds wrote:
Fri Mar 10, 2023 3:15 pm

Xan wrote:
Thu Mar 09, 2023 11:37 am




Would you rather the poor be poorer, so long as the rich are worse off?
https://www.youtube.com/watch?v=pdR7WW3XR9c


This was actually pretty thought provoking. I watched the video twice and then thought about it more during an evening walk (I know, get a life).
If I am understanding what Maggie said, the differential gap between the poor and rich is essentially fixed. If you make one lower, by default the other is proportionately lower and vice versa if higher. I get a picture in my mind of a statistical distribution that is fixed. The number scale may go higher or lower, but the distribution never changes. I think she demonstrated it herself by moving her hands up and down, keeping the gap fixed.

Thus for the poor to do better the rich HAVE to do better and likewise if the rich do worse, then the poor will HAVE to do worse. The gap cannot narrow (or widen I suppose). And so she reaches the conclusion that the poor will be poorer if the rich are worse off.
Is that what she's saying?


If you got what you she is saying .... do you agree with that?

Seems like in different societies the size of the gap with be different and that the size of the gap will change over time within each of those societies? Which would then be counter to what she appeared to be saying?
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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Re: Socialism - Should we be worried

Post by glennds » Fri Mar 10, 2023 5:00 pm

Xan wrote:
Fri Mar 10, 2023 3:36 pm
glennds wrote:
Fri Mar 10, 2023 3:15 pm
Xan wrote:
Thu Mar 09, 2023 11:37 am



Would you rather the poor be poorer, so long as the rich are worse off?
https://www.youtube.com/watch?v=pdR7WW3XR9c
This was actually pretty thought provoking. I watched the video twice and then thought about it more during an evening walk (I know, get a life).
If I am understanding what Maggie said, the differential gap between the poor and rich is essentially fixed. If you make one lower, by default the other is proportionately lower and vice versa if higher. I get a picture in my mind of a statistical distribution that is fixed. The number scale may go higher or lower, but the distribution never changes. I think she demonstrated it herself by moving her hands up and down, keeping the gap fixed.

Thus for the poor to do better the rich HAVE to do better and likewise if the rich do worse, then the poor will HAVE to do worse. The gap cannot narrow (or widen I suppose). And so she reaches the conclusion that the poor will be poorer if the rich are worse off.
Is that what she's saying?

I don't think she's concluding that the poor will by necessity be poorer if the rich are worse off. She's saying that it's disingenuous to complain about a gap at a time when poor people are being made wealthier. To look at a poor person doing better than he was before and then complain about the situation is to wish that poor person were worse off, as long as somebody else is MORE worse off.
Thank you, I see the distinction now. And I agree, to a point. The 1980s was a grand experiment in trickle down economics, and while the idea hasn't been totally discredited, I think there are differing opinions on whether enough trickled down such that society as a whole was lifted.

I'm kind of glad the claim wasn't that the gap is a static variable because over time in the United States the trend toward widening is material. The upper left quadrant of the chart below demonstrates it. If the Maggie argument is that the bottom 50% is getting a smaller percentage of a larger pie and still better off than they would have been when they had a larger slice, I get the logic, but don't know if it is unprovably self serving or genuinely true.
I would not agree with anyone who thinks disparity is a non-issue (as I initially thought Maggie was saying). At some point it seems like it would be unhealthy if the result is winners and losers as opposed to what you are saying i.e. winners and smaller winners.
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Xan
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Re: Socialism - Should we be worried

Post by Xan » Fri Mar 10, 2023 6:28 pm

glennds wrote:
Fri Mar 10, 2023 5:00 pm
Thank you, I see the distinction now. And I agree, to a point. The 1980s was a grand experiment in trickle down economics, and while the idea hasn't been totally discredited, I think there are differing opinions on whether enough trickled down such that society as a whole was lifted.

I'm kind of glad the claim wasn't that the gap is a static variable because over time in the United States the trend toward widening is material. The upper left quadrant of the chart below demonstrates it. If the Maggie argument is that the bottom 50% is getting a smaller percentage of a larger pie and still better off than they would have been when they had a larger slice, I get the logic, but don't know if it is unprovably self serving or genuinely true.
I would not agree with anyone who thinks disparity is a non-issue (as I initially thought Maggie was saying). At some point it seems like it would be unhealthy if the result is winners and losers as opposed to what you are saying i.e. winners and smaller winners.

I believe she was in fact saying it's a non-issue, or rather, that everyone is better off than with the alternative.

The way this discussion is trending reminds me of a really interesting video by Ray Dalio which must have been posted here some other time:
Principles for Dealing with the Charging World Order
https://www.youtube.com/watch?v=xguam0TKMw8

It's fairly long, but in part it describes how a wealth gap is inevitable in a successful society, and isn't a problem as long as standards of living are increasing for everyone. But as soon as something goes wrong and the less-well-off see their standard of living drop, even a little, the by-then-enormous wealth gap causes internal strife.

The overall point of the video seems to be that the US is on the verge of losing its status in favor of China. I'm not sure how much I buy it but it has some interesting history of how other countries were top dog and then lost it.
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Re: Socialism - Should we be worried

Post by jalanlong » Sat Mar 11, 2023 10:29 am

Xan wrote:
Fri Mar 10, 2023 6:28 pm
glennds wrote:
Fri Mar 10, 2023 5:00 pm
Thank you, I see the distinction now. And I agree, to a point. The 1980s was a grand experiment in trickle down economics, and while the idea hasn't been totally discredited, I think there are differing opinions on whether enough trickled down such that society as a whole was lifted.

I'm kind of glad the claim wasn't that the gap is a static variable because over time in the United States the trend toward widening is material. The upper left quadrant of the chart below demonstrates it. If the Maggie argument is that the bottom 50% is getting a smaller percentage of a larger pie and still better off than they would have been when they had a larger slice, I get the logic, but don't know if it is unprovably self serving or genuinely true.
I would not agree with anyone who thinks disparity is a non-issue (as I initially thought Maggie was saying). At some point it seems like it would be unhealthy if the result is winners and losers as opposed to what you are saying i.e. winners and smaller winners.

I believe she was in fact saying it's a non-issue, or rather, that everyone is better off than with the alternative.

The way this discussion is trending reminds me of a really interesting video by Ray Dalio which must have been posted here some other time:
Principles for Dealing with the Charging World Order
https://www.youtube.com/watch?v=xguam0TKMw8

It's fairly long, but in part it describes how a wealth gap is inevitable in a successful society, and isn't a problem as long as standards of living are increasing for everyone. But as soon as something goes wrong and the less-well-off see their standard of living drop, even a little, the by-then-enormous wealth gap causes internal strife.

The overall point of the video seems to be that the US is on the verge of losing its status in favor of China. I'm not sure how much I buy it but it has some interesting history of how other countries were top dog and then lost it.

https://www.lynalden.com/qe-and-inequality/

Lyn Alden has a very long article that essentially blames quite a few actors for the growing inequality. If you want to get to the meat of it then start towards the bottom headline that says "The Reality --- It's Complicated"

"Wealth pendulums historically have multi-decade swings until they reach unsustainable levels of cronyism. Back in the 1970s, wealth concentration was low and organized labor had a lot of power to the point of corruption and cronyism, but that started to be broken up in the 1980s.

On the fiscal side, tax changes from then on increasingly began favoring corporations and the wealthy, and the US in particular outsourced large swaths of its industrial base and financial assets to other countries, by members of both political parties, to maintain its reserve currency status in favor of the corporate and political elite, which put additional downward pressure on blue collar jobs and wages. Higher education became more necessary and more expensive, while the US reached the highest per-capita healthcare costs in the world, which the public and their employers have to finance. Trillions of dollars were spent on foreign wars without clear victories, other than benefiting the military industrial complex (again favoring the corporate and political elite rather than the middle class) that President Eisenhower warned us about in the 1950s. Overall, across sectors, the pendulum has now swung far in favor of corporate cronyism.

That sort of summary is too complicated, and it implicates both major political parties as well as the Fed and corporations with a bunch of moving parts and individual decisions over decades until it became locked in. Instead, people typically prefer simple narratives and someone clear to blame."
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Re: Socialism - Should we be worried

Post by Maddy » Sat Mar 11, 2023 10:39 am

It's an unfortunate aspect of human nature that compels people to keep up with the Joneses. Before the internet and television gone wild, the biggest concern of most social climbers was their next door neighbor's new sports car. Now they have to keep up with imaginary people who do not work and yet somehow manage to live glamor-filled lifestyles. Most reasonable people are able to blow these images off as an irrelevant fiction, but it appears that they stir a great deal of anger and envy in others.
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Re: Socialism - Should we be worried

Post by vnatale » Sat Mar 11, 2023 11:41 am

jalanlong wrote:
Sat Mar 11, 2023 10:29 am



On the fiscal side, tax changes from then on increasingly began favoring corporations and the wealthy, and the US in particular outsourced large swaths of its industrial base and financial assets to other countries, by members of both political parties, to maintain its reserve currency status in favor of the corporate and political elite, which put additional downward pressure on blue collar jobs and wages. Higher education became more necessary and more expensive, while the US reached the highest per-capita healthcare costs in the world, which the public and their employers have to finance. Trillions of dollars were spent on foreign wars without clear victories, other than benefiting the military industrial complex (again favoring the corporate and political elite rather than the middle class) that President Eisenhower warned us about in the 1950s. Overall, across sectors, the pendulum has now swung far in favor of corporate cronyism.




Excellent paragraph!
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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Re: Socialism - Should we be worried

Post by vnatale » Sat Mar 11, 2023 11:46 am

Maddy wrote:
Sat Mar 11, 2023 10:39 am

It's an unfortunate aspect of human nature that compels people to keep up with the Joneses. Before the internet and television gone wild, the biggest concern of most social climbers was their next door neighbor's new sports car. Now they have to keep up with imaginary people who do not work and yet somehow manage to live glamor-filled lifestyles. Most reasonable people are able to blow these images off as an irrelevant fiction, but it appears that they stir a great deal of anger and envy in others.


I remember in the late 90s trying to counsel two recent high school graduates who I'd spent a fair amount of time with playing sports and taking them to sports games.

Neither of them had fathers so I was trying to give them some adult advice by telling them they did not have to buy fancy cars and get car loans. That a cheap car is all they really needed. I was shocked when they responded that they did need a car that had to look good and they were fine with taking out car loans. I could not believe that they'd already been inculcated into "The American Way", this aspect of it being obtaining debt.

Early on I decided I never wanted to pay interest for anything as I always viewed that as a way of enjoying something now but then you end up still paying for it while you are no longer enjoying that item.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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Re: Socialism - Should we be worried

Post by boglerdude » Sat Mar 11, 2023 7:08 pm

Social media has made it easier to stay home all day. Less boredom.

Jobs are more technical. Most people either cant code or would rather not.

Dating is getting stranger. Grandpa "wouldnt take no for an answer" isnt as cool. Single men have less incentive to earn 6 figures.

Jobs sent overseas, millions of legal and illegal immigrants. "covid" work from home will send more jobs overseas.

A lot could be solved by removing minimum wage, but that wont happen. It'll get lowered through inflation.

Lastly, people need a fight. The social justice kids will never stop. Nightstick therapy from drones will keep em in line tho. Outside the times they're needed to influence elections.
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Re: Socialism - Should we be worried

Post by jalanlong » Wed Mar 15, 2023 5:05 pm

seajay wrote:
Wed Mar 08, 2023 10:55 am
... but aren't many youth (<30 years) more inclined to socialism, that transition to being capitalist (>30 years old) ... once they've accumulated some of their own wealth.
I heard an adage years ago that a Republican was just a Democrat that had not been robbed yet.
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Re: Socialism - Should we be worried

Post by seajay » Fri Mar 24, 2023 2:46 pm

jalanlong wrote:
Wed Mar 15, 2023 5:05 pm
seajay wrote:
Wed Mar 08, 2023 10:55 am
... but aren't many youth (<30 years) more inclined to socialism, that transition to being capitalist (>30 years old) ... once they've accumulated some of their own wealth.
I heard an adage years ago that a Republican was just a Democrat that had not been robbed yet.
:)
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Re: Socialism - Should we be worried

Post by ochotona » Sat Mar 25, 2023 11:30 am

We have socialism in the USA, it's for the rich.

You privatize the gains, and socialize the risk and losses.

Bail-outs, bail-ins, employers not paying a living wage and then their full-time workers needing public assistance, businesses committing billions in COVID relief fraud, railroads being deregulated to "free them up to succeed" then a massive catastrophe in Ohio, billions not really paying hardly any of their annual comp in taxes, drugs like the COVID vaxes developed with Federal grants being privatized and sold for more than $100 per dose now,...

Should we be worried? I was worried about the moral hazard in 2008. QE was the biggest socialism for the rich program in human history.
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Re: Socialism - Should we be worried

Post by D1984 » Sat Mar 25, 2023 11:19 pm

Xan wrote:
Thu Mar 09, 2023 10:42 am
glennds wrote:
Thu Mar 09, 2023 10:06 am
Maddy wrote:
Thu Mar 09, 2023 7:55 am
I think the writing is on the wall that the wealthy (including the traditional middle-class) are going to increasingly vilified and made to do penance for whatever inequality happens to be the focus of concern.
I definitely agree it's not justified or helpful to villianize the wealthy. But I wonder how large a percentage of the traditional middle-class are now "wealthy"? The issue I see is the disappearance of the middle class and the widening polarization between haves and have nots. For every person that used to be middle class that is now wealthy, I would bet there are two that went the other way.

That's the kind of thing that we don't have to bet on: we can just go look at data.
https://www.wsj.com/articles/upward-mob ... _permalink
If there is ever a massive open online masterclass in lying with statistics, cherry-picking starting points in order to move the needle in your direction and hide the actual truth, acting as a complete hypocrite by treating one of the very reasons inequality hasn't increased as much as it would otherwise (government transfers and taxes) as "proof" that things aren't so bad for the poor or middle class when you yourself and your whole political party are against the very existence of said transfers and would remove them entirely if they could, and distorting categories by counting something as income when it isn't actually spendable income....well, Phil Gramm should certainly teach it.

See https://newrepublic.com/article/167811/ ... ality-myth

And also see these:

Cost of house vs median income in the US: https://www.longtermtrends.net/home-pri ... ome-ratio/

Real value of minimum wage (which is lower today in real terms than it was even in the early 1950s despite decades of productivity growth since then): https://www.statista.com/statistics/106 ... m-wage-us/

Real median usual weekly real earnings of full-time wage and salary workers in the US (note that it has grown by barely over 0.19% a year--less than one fifth of one percent per year--despite productivity growth being much higher than that): https://fred.stlouisfed.org/series/LES1252881600Q .

As to where the fruits of economic growth went instead? https://time.com/5888024/50-trillion-in ... y-america/ (and that was in 2018 dollars....it's probably at least $53 trillion in today's dollars)

Oh, and here's the real value (the blue line in the graph) of average hourly earnings of production and nonsupervisory workers: https://fred.stlouisfed.org/graph/?graph_id=206232 . Lower than it was 50 years ago despite decades of economic growth in the meantime.

Finally, look around and ask yourself why one breadwinner could own a house, raise a family, send the kids to college, and have a decent secure retirement 40 or 50 years ago (despite the fact that we were actually much poorer as a nation in terms of GDP per capita back then) but it now takes two full time (or at least one full time and one part time) workers to even approach doing the same; see https://americancompass.org/2023-cost-o ... ing-index/

I guess it comes down to this...who are you going to believe, Phil Gramm or your own lying eyes?

I would also ask everyone to ponder on what eventually tends to happen to societies that don't let the average citizen share in the fruits of growth and/or shift risk and misery to said citizens when the elites are perceived to be doing just fine....it isn't pretty and it typically results in said wealthy and powerful elites losing their wealth if they are lucky and/or their lives if they aren't. You can only stretch a rubber band so far before it snaps.....
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