patrick.net

Reality says

2%? Are you a high school student not in charge of your own finances or someone living outside of the US? The typical property tax bill for the upper middle class family in the US is $5000 to $15,000 a year! After paying that property tax (more than half of which is allegedly spent on the local public school in most towns), the family would be hard pressed to pay for private schooling of their children.

And how much does an upper middle class family in the US earn? $100k? $150K? Assume $7500, half of which is education, gives me somewhere between 2.5% and 3.75%. I'd say that's a lot closer to 2% than 100%. Wouldn't you agree?

Reality says

For that, you have the fiat money system to thank for (43 year and counting). When businesses' success vs. failure is more dependent on manana from the central bank printing press, employees and sound business practice become less important.

Nope--it has very little to do with fiat money.

Reality says

Welfare is income and is taxed as such in many cases

And that's why I said to include it as income and not wealth.

Reality says

You either discard the meaningless definition of "wealth" that keeps out all the crucial factors affecting people's real standards of living, or render your entire thesis irrelevant.

In this case, the definition isn't meaningless so we can keep it. What's meaningless is your attempt to describe potential future income as wealth.

tatupu70 says

And how much does an upper middle class family in the US earn? $100k? $150K? Assume $7500, half of which is education, gives me somewhere between 2.5% and 3.75%. I'd say that's a lot closer to 2% than 100%. Wouldn't you agree?

Nope. The $100k family faces marginal tax rate on income close to 50%: 15% payroll tax, 25% federal income tax, state income tax 5-8%. That's before the aforementioned property tax, which works out to be 5-10% of income if the rate is 1-2% on a house worth 5x annual income. So the overall tax rate before sales tax is already 50-60%! The $5000-15,000 a year represent a very large proportion of the family's disposable income (nearly all of it in some cases), not the 2% number you were bandying about. I'm starting to think you are a high school kid or someone who is so wealthy that you have no idea how the middle class and upper middle class household is run nowadays.

tatupu70 says

For that, you have the fiat money system to thank for (43 year and counting). When businesses' success vs. failure is more dependent on manana from the central bank printing press, employees and sound business practice become less important.

Nope--it has very little to do with fiat money.

You claimed the prroblem has been running for 30-50 years. I pointed out to the obvious culprit. Of course, you are paid to ignore that one. LOL.

tatupu70 says

Reality says

You either discard the meaningless definition of "wealth" that keeps out all the crucial factors affecting people's real standards of living, or render your entire thesis irrelevant.

In this case, the definition isn't meaningless so we can keep it. What's meaningless is your attempt to describe potential future income as wealth.

Wealth fundamentally IS the potential for generating future income without having to work for it. Here is a simple example for you: the capital asset of Kodak was wealth before film was displaced by digital photography; after the transition, Kodak's "wealth" literally disappeared because its dominant market position in film photography became meaningless.

Here is another example for you: a life insurance policy holder with a 50,000 Marks maturity value had enormous wealth in 1913 (comparable to several million dollars today). The same policy holder being paid that 50,000 marks in 1923, just enough to buy a loaf of bread, lost all that wealth.

Reality says

You claimed the prroblem has been running for 30-50 years. I pointed out to the obvious culprit. Of course, you are paid to ignore that one. LOL.

First--that's not what I pointed out. I said compared to 30 years ago or 50 years ago. Fiat money is not the obvious culprit except to Fed cultists.

Reality says

Nope. The $100k family faces marginal tax rate on income close to 50%: 15% payroll tax, 25% federal income tax, state income tax 5-8%. That's before the aforementioned property tax, which works out to be 5-10% of income if the rate is 1-2% on a house worth 5x annual income. So the overall tax rate before sales tax is already 50-60%! The $5000-15,000 a year represent a very large proportion of the family's disposable income (nearly all of it in some cases), not the 2% number you were bandying about. I'm starting to think you are a high school kid or someone who is so wealthy that you have no idea how the middle class and upper middle class household is run nowadays.

No, the 2% is approximately correct. I don't care about the other taxes--we're talking about taxes for education, not the overall tax load. Try to stay on topic--I know it's very difficult for you because then your points are shown to be ridiculous.

Reality says

Wealth fundamentally IS the potential for generating future income without having to work for it

No, it's really not. Like I said--show me one definition that describes wealth as such.

tatupu70 says

Reality says

You claimed the prroblem has been running for 30-50 years. I pointed out to the obvious culprit. Of course, you are paid to ignore that one. LOL.

First--that's not what I pointed out. I said compared to 30 years ago or 50 years ago. Fiat money is not the obvious culprit except to Fed cultists.

You are being willfully blind. The biggest change in the past 30-50 years is the vast expansion of the financial sector, at the peak accounting for nearly half of all SP500 profit. Financialization of the economy is the fundamental reason why manufacturing as well as R&D went overseas.

Reality says

You are being willfully blind. The biggest change in the past 30-50 years is the vast expansion of the financial sector, at the peak accounting for nearly half of all SP500 profit. Financialization of the economy is the fundamental reason why manufacturing as well as R&D went overseas.

OK--my eyes are open. Can you expand on this theory and explain why the expansion of the financial industry caused companies to move manufacturing overseas?

tatupu70 says

No, the 2% is approximately correct. I don't care about the other taxes--we're talking about taxes for education, not the overall tax load. Try to stay on topic--I know it's very difficult for you because then your points are shown to be ridiculous.

LOL. 2% is not anywhere near correct. You are off by a factor of 100% to 3000%! Learn math and try to stay on topic instead of trying to tell others to stay on your non-sensical definition of topic.

tatupu70 says

Reality says

Wealth fundamentally IS the potential for generating future income without having to work for it

No, it's really not. Like I said--show me one definition that describes wealth as such.

That is the essence of every definition of wealth. What the heck would a cart load of Zimbabwe dollars or Weimar marks be good for? Wealth is the power to get things that one wants, and the security to secure such supplies in the future without having to work.

tatupu70 says

Reality says

You are being willfully blind. The biggest change in the past 30-50 years is the vast expansion of the financial sector, at the peak accounting for nearly half of all SP500 profit. Financialization of the economy is the fundamental reason why manufacturing as well as R&D went overseas.

OK--my eyes are open. Can you expand on this theory and explain why the expansion of the financial industry caused companies to move manufacturing overseas?

It literally happened to me: I had a very talented assistant working for me for one of my businesses that involved light manufacturing. Then the person was hired away to do mortgage origination during the peak of the housing bubble. So I sent the light manufacturing aspect of that business overseas.

Government subsidized financial industry (via central banking legal tender law for everyone else but privilege to print for themselves) drive out other industries in the same way urban commercial development and government expansion in NYC and DC drove out farming and garment industries. Living in a place has opportunity cost. As financial industry employees bid up the price of housing, medicine, education and pussies, other people have to either join the highly favored industries or move the heck out.

Rin recognize the issue when he noticed girls pay him a lot more attentions after he switched from engineering to finance. What do you think that do to boys who want pussies and plan their careers accordingly? Or mothers and fathers who have children to feed and raise?

Reality says

LOL. 2% is not anywhere near correct. You are off by a factor of 100% to 3000%! Learn math and try to stay on topic instead of trying to tell others to stay on your non-sensical definition of topic.

The topic was how much an upper middle class family gets taxed for public education. Your example was 100% (robbed of all their money), mine was 2%. Which is closer to the truth?

Reality says

That is the essence of every definition of wealth.

OK great. Please show me the all the sources that define wealth as such.

Reality says

Government subsidized financial industry (via central banking legal tender law for everyone else but privilege to print for themselves) drive out other industries in the same way urban commercial development and government expansion in NYC and DC drove out farming and garment industries.

Yuuuuuuup.

Same thing in the UK, which has always pulled out every stop to keep the Sterling high to benefit the City and therefore the rest of the UK non-competitive.

Reality says

It literally happened to me: I had a very talented assistant working for me for one of my businesses that involved light manufacturing. Then the person was hired away to do mortgage origination during the peak of the housing bubble. So I sent the light manufacturing aspect of that business overseas.

Bwahahahahahahahahaha.

You're trying to tell me that you couldn't find anyone to do light manufacturing???? Please stop.

Reality says

Government subsidized financial industry (via central banking legal tender law for everyone else but privilege to print for themselves) drive out other industries in the same way urban commercial development and government expansion in NYC and DC drove out farming and garment industries. Living in a place has opportunity cost. As financial industry employees bid up the price of housing, medicine, education and pussies, other people have to either join the highly favored industries or move the heck out.

Was there a lot of manufacturing being done in Manhattan previously? Why didn't they just move to other lower cost areas of the US?

Reality says

Rin recognize the issue when he noticed girls pay him a lot more attentions after he switched from engineering to finance. What do you think that do to boys who want pussies and plan their careers accordingly? Or mothers and fathers who have children to feed and raise?

Again--this makes no sense. You're literally saying that the reason there are too many workers with no jobs is because companies moved overseas because they couldn't find any workers. Do you see how ridiculous that is??

Reality says

Rin recognize the issue when he noticed girls pay him a lot more attentions after he switched from engineering to finance. What do you think that do to boys who want pussies and plan their careers accordingly? Or mothers and fathers who have children to feed and raise?

And the industry is basically a parasite, skimming off transactions and earning large salaries from the sales of paper agreements, oftentimes bogus.

tatupu70 says

Reality says

LOL. 2% is not anywhere near correct. You are off by a factor of 100% to 3000%! Learn math and try to stay on topic instead of trying to tell others to stay on your non-sensical definition of topic.

The topic was how much an upper middle class family gets taxed for public education. Your example was 100% (robbed of all their money), mine was 2%. Which is closer to the truth?

LOL. Talk about pointless strawman tactic. My point was that the middle class and upper middle class can no longer afford private education when the money reasonably can be expected from a family to be allocated to education is sucked up by taxes.

Nobody said 100% of all income is sucked up by taxation (you can disprove that thesis just by pointing out the middle class and upper middle class can still buy food without using food stamps. Duh!). "All their money" was referring to all the money that can be reasonably expected to be allocated to the education of their children. A family making $80-100k only face payroll tax and income tax to the tune of about $40k. After another $20-30k for housing, $10k for cars and insurance, $5k for utilities, phone and cable TV, $5-10k for food, $3-5k for clothing, there simply isn't another $5k-15k for private education when the local property tax bill is eating up $5k-15k. The "public" education monopoly for education has already eaten up all the disposable money that can be reasonably allocated to the kids' education.

tatupu70 says

Bwahahahahahahahahaha.

You're trying to tell me that you couldn't find anyone to do light manufacturing???? Please stop.

Nope. I spent over a year to train the person to do the job, then the person was hired away by the FIRE industry. It would be difficult to find the talent as well as costly to train again, with the likelihood of the same kind of problem of being hired away by the FIRE industry at higher pay. I was not interested in going through that cycle again.

tatupu70 says

Again--this makes no sense. You're literally saying that the reason there are too many workers with no jobs is because companies moved overseas because they couldn't find any workers. Do you see how ridiculous that is??

I never said "there are too many workers with no jobs." Only silly people like you would say such a thing. Someone without a job is not a worker in my books.

Companies are reluctant to hire domestic job seekers for a variety of reasons:

1. Many job seekers are not employable or only marginally employable due to poor work ethics;

2. Some "job seekers" are only "seeking" in order to receive unemployment payment;

3. FIRE employees have bid up the cost of living to such a degree that employers in other industries simply can not afford to pay enough to keep the employee living in those areas;

4. Point #3 is worth repeating. It is actually the same reason as high unemployment in major cities at times even as farming as an industry is driven out of the city. The full cycle productivity of a farm worker with basic tools can not make enough to pay for the opportunity cost of living in the city. Likewise, the full cycle productivity of a basic manufacturing job worker can no longer afford the opportunity cost of living in the USA. That's why the farm jobs moved out of NYC despite bouts of high employment; likewise, manufacturing jobs moved out of the US despite bouts of high employment. Once the workers and the landlords have experienced the high pay of commercial jobs, they are no longer interested in the low return farming; likewise, many workers in the US are searching for "get-rich-quick" jobs, not the daily grind manufacturing jobs, nor do the landlords.

Reality says

Government subsidized financial industry (via central banking legal tender law for everyone else but privilege to print for themselves) drive out other industries in the same way urban commercial development and government expansion in NYC and DC drove out farming and garment industries. Living in a place has opportunity cost. As financial industry employees bid up the price of housing, medicine, education and pussies, other people have to either join the highly favored industries or move the heck out.

Yep. that is the main issue and driver of wealth inequality, not tax rates on people making 200K+

Blurtman says

Reality says

Rin recognize the issue when he noticed girls pay him a lot more attentions after he switched from engineering to finance. What do you think that do to boys who want pussies and plan their careers accordingly? Or mothers and fathers who have children to feed and raise?

And the industry is basically a parasite, skimming off transactions and earning large salaries from the sales of paper agreements, oftentimes bogus.

Absolutely. This in turn again is a the main driver for people to want an MBA degree, preferably from a "reputable" university and shell out ludicrous sums for tuition to learn nothing but high school math.

Reality says

Government subsidized financial industry (via central banking legal tender law for everyone else but privilege to print for themselves) drive out other industries in the same way urban commercial development and government expansion in NYC and DC drove out farming and garment industries. Living in a place has opportunity cost. As financial industry employees bid up the price of housing, medicine, education and pussies, other people have to either join the highly favored industries or move the heck out

Absolute utter total bollocks. First off there hasn't been farming in DC or NYC in 100 years. What drove farming out of the surrounding areas was suburban growth. The financial industry didn't drive anyone out of NYC Manufacturing went to cheap non union states in the south. Then overseas. You couldn't give land away in NYC in the 60's. The interstates allowed white flight and manufacturing flight.

By the 70's there were huge sections of NYC that were just abandonded. The entire west side of Manhatten was just collapsed empty warehouses. A big chunk the south part of the island wasn't any better. Artists and basically hippies moved into places like SOHO (south of houston) and Tribeca (triangle below canal) because they could rent huge former manufacturing lofts for next to nothing. Totally illegally since the area wasn't residential. Also pretty dangerous. Crime was really bad. As the city improved in the 80's these area's become more popular. Also many of the blighted areas were torn down and redeveloped. Javets Center (from 12th you could barely fight your way through the hookers to get to the lincoln tunnel in the 70's) and the Intrepid (they didn't call the area hells kitchen for nothing) comes to mind.

You've got the cart way in front of the horse. Manufacturing left, the city collapsed, then finance came around.

Reality says

Nobody said 100% of all income is sucked up by taxation

So, what was this analogy then:

Reality says

Just like even if you were a productive person, if someone mugs you every month right after your payday and take away all your money, you'd still starve.

Reality says

Nope. I spent over a year to train the person to do the job, then the person was hired away by the FIRE industry. It would be difficult to find the talent as well as costly to train again, with the likelihood of the same kind of problem of being hired away by the FIRE industry at higher pay. I was not interested in going through that cycle again.

The bottom line is either you weren't paying the market rate or he maybe he didn't like having you as a boss.

As an aside--What light manufacturing job takes 1 year to train?? Was he running a Nuclear Power plant?

Reality says

Companies are reluctant to hire domestic job seekers for a variety of reasons:

1. Many job seekers are not employable or only marginally employable due to poor work ethics;

2. Some "job seekers" are only "seeking" in order to receive unemployment payment;

3. FIRE employees have bid up the cost of living to such a degree that employers in other industries simply can not afford to pay enough to keep the employee living in those areas;

What a load of BS. Is that what you tell yourself to rationalize moving jobs overseas??

bob2356 says

Government subsidized financial industry (via central banking legal tender law for everyone else but privilege to print for themselves) drive out other industries in the same way urban commercial development and government expansion in NYC and DC drove out farming and garment industries. Living in a place has opportunity cost. As financial industry employees bid up the price of housing, medicine, education and pussies, other people have to either join the highly favored industries or move the heck out

Absolute utter total bollocks. First off there hasn't been farming in DC or NYC in 100 years. What drove farming out of the surrounding areas was suburban growth. The financial industry didn't drive anyone out of NYC Manufacturing went to cheap non union states in the south. Then overseas. You couldn't give land away in NYC in the 60's. The interstates allowed white flight and manufacturing flight.

Reading comprehension problem? What was suburban growth if it is not commercial development creating higher/rising opportunity cost for land?

In the same way, government subsidized financial industry has been creating rising opportunity cost for living and working in the US, the financial capital of the world.

Someone did not study analogy.

mell says

Yep. that is the main issue and driver of wealth inequality, not tax rates on people making 200K+

Again-complete BS.

mell says

Absolutely. This in turn again is a the main driver for people to want an MBA degree, preferably from a "reputable" university and shell out ludicrous sums for tuition to learn nothing but high school math.

This I agree with---the finance industry could virtually disappear and the US economy would be no worse off. IMO--the value of liquidity is vastly overrated.

bob2356 says

By the 70's there were huge sections of NYC that were just abandonded. The entire west side of Manhatten was just collapsed empty warehouses. A big chunk the south part of the island wasn't any better.

Notice, the land did not go back to farming, but was abandoned. Likewise, IMHO, the set back in the heady financial industry is not leading businesses or people back to manufacturing jobs. They are puttering around waiting for the next big thing.

tatupu70 says

The bottom line is either you weren't paying the market rate or he maybe he didn't like having you as a boss.

It was a she. She loved working for me, but there was no way I could pay as much as the commissions on mortgage origination. I ran a sustainable business, whereas the mortgage origination company's business model was huge bonuses while the going was good then file for bankruptcy when it is not. That's what government subsidized financialization has done. What normal legit business expecting to stick around for a long time can compete against that?

As an aside--What light manufacturing job takes 1 year to train?? Was he running a Nuclear Power plant?

It involved design and artistic talent as well as organizational skills. I paid her $30/hr, but couldn't compete against mortgage origination commissions.

tatupu70 says

Reality says

Companies are reluctant to hire domestic job seekers for a variety of reasons:

1. Many job seekers are not employable or only marginally employable due to poor work ethics;

2. Some "job seekers" are only "seeking" in order to receive unemployment payment;

3. FIRE employees have bid up the cost of living to such a degree that employers in other industries simply can not afford to pay enough to keep the employee living in those areas;

What a load of BS. Is that what you tell yourself to rationalize moving jobs overseas??

I don't need to rationalize moving jobs overseas. Employees decided to work for the FIRE industry instead.

tatupu70 says

Absolutely. This in turn again is a the main driver for people to want an MBA degree, preferably from a "reputable" university and shell out ludicrous sums for tuition to learn nothing but high school math.

This I agree with---the finance industry could virtually disappear and the US economy would be no worse off. IMO--the value of liquidity is vastly overrated.

The reason why those jobs exist and are high paying and induce parents and students to shell enormous sums is because these jobs are essentially subsidized by the government. It's just like parents used to tell their daughters to marry doctors because it is a licensed industry, and in some other cultures, the young eagerly pursue government bureaucrat careers because once again those bureaucratic positions are highly subsidized.

Reality says

The reason why those jobs exist and are high paying and induce parents and students to shell enormous sums is because these jobs are essentially subsidized by the government. It's just like parents used to tell their daughters to marry doctors because it is a licensed industry, and in some other cultures, the young eagerly pursue government bureaucrat careers because once again those bureaucratic positions are highly subsidized.

This I do not agree with. The free market is the cause--notice that as regulation is reduced, the finance industry grows and becomes even more destructive.

tatupu70 says

Reality says

The reason why those jobs exist and are high paying and induce parents and students to shell enormous sums is because these jobs are essentially subsidized by the government. It's just like parents used to tell their daughters to marry doctors because it is a licensed industry, and in some other cultures, the young eagerly pursue government bureaucrat careers because once again those bureaucratic positions are highly subsidized.

This I do not agree with. The free market is the cause--notice that as regulation is reduced, the finance industry grows and becomes even more destructive.

The finance industry pays those who create the laws to make sure that their paper agreements are sacrosanct. Just look how Tiimmy and Hanky broke the law to bail out the TBTF's through AIG.

A while ago, the Chinese government told Goldman Sachs to take some horribly underwater swaps derivatives unwisely purchased by a Chinese company and stick them where the sun doesn't shine. The world did not come to an end. But as long as the USG is acting as the law for the TBTF's in these matters, citizens will continue to be sucked dry.

tatupu70 says

Reality says

The reason why those jobs exist and are high paying and induce parents and students to shell enormous sums is because these jobs are essentially subsidized by the government. It's just like parents used to tell their daughters to marry doctors because it is a licensed industry, and in some other cultures, the young eagerly pursue government bureaucrat careers because once again those bureaucratic positions are highly subsidized.

This I do not agree with. The free market is the cause--notice that as regulation is reduced, the finance industry grows and becomes even more destructive.

Fiat money central banking is not a product of free market. It is entirely a product of territorial (i.e. Feudal) privilege. When the lords are given the privilege to rape and pillage the peasants, sometimes "code of chivalry" was introduced to ameliorate the worst of excesses.

When regulations on banks were reduced, the effect of government regulation via fiat money printing privilege was expanded not reduced. It's like the banks were given the right to kill.