The Next Big Crash - Are You Prepared?

(10-10-2013, 03:55 PM)freedom Wrote: I recognize that wealth transfer is necessary. At least the disabled ones receive wealth from someone else.

Today, problem in US is not about minimum necessary, but how much more should the riches be taxed to transfer to the poor?

As for there isn't enough opportunities for business investment in US, I don't believe it. Is US so advanced that it does not require any further improvement in anything? As for job opportunities, there are plenty, too. There are still lots of Mexicans coming to US for jobs. So how could we say there isn't job for Americans?

Well, i do think there should be higher taxes on the rich, but not to distribute more to the poor. The US is now deeply divided and i do think that there needs to be a sense of shared sacrifice to bring the fiscal house in order. But to cut entitlements now would be a death sentence to many who depend on it and would probably derail the US economic recovery. In the end, i think entitlement cuts are necessary, given the stupid execution of their social security system in the past, but it has to be done together with higher taxes.

What the US needs is the government to do, is to come up with sound governance policies and not just permanent campaign style politics. The democrats need to stop advocating for more and more and more welfare while the republicans need to stop their "starve the beast" strategy.

(10-10-2013, 02:47 PM)freedom Wrote: I realize that often our discussion derails to somewhere I believe non-essential.

In most of my discussion, I ignore those disabled ones. The disabled ones are really the minority in the society, less than 1%, I guess. They are well taken care and do not consume most of the government spending. I am not including the elder/retired ones, they are supposed to be mostly funded by themselves when they were young and able. The less able ones I refer to are those unemployed adults or those adults who "give up" their seek of employment.

Another question from me is that how more consumption on basic need and food benefits the society more than the business investment made by the riches? I heard the argument too many times, but I haven't seen a convincing argument yet. My simple understanding is that the human/society progress centers on technology and investment, which are not basic consumption or food.

Ultimately, if we trace the owners of the tax revenue, mostly are still from the riches. The riches do business investment, which creates jobs and income for the general population, which enables them to pay payroll tax and other taxes and consume other products and services. Of course, I am not saying that the riches provides 100% of the tax revenue. But the origin of the tax revenue often traces back to the riches partly. Or think from another perspective. If we remove the business investment from the riches, the economy provided by the government is much smaller, so is the tax revenue.

So I assume we are agreeable on Medishield and Obamacare?

Those able adults and unemployed adults should have opportunities to find work. When the society failed to do that like Greece now, you would have a massive brain drain. Of course everything has its price, including willingness to work. If we pay them $100k for doing nothing, a lot of people will not work. Tricky part is how much to provide them such that they have sufficient income to survive and "pursue their happyness". That's why US is always talking about job creation. What policy makers should be wary of are those pampered ones that refuse to work which are not non-existant but very minority.

If these people cannot have their basic needs fulfilled, how are they able to unleash potentials for greater value add work like technology and services? (think Maslow's hierarchy of needs) Firstly satisfy the basic needs, then create opportunities for greater heights. The society benefits.

Of course the rich pays the most taxes. But if it is that bad, why don't the Londoners leave the City after they hike taxes? Because there are other incentives for them to stay and they benefit when the society as a whole improves. Taxes are one driver, but to simplify it as the main driver for people's decision making is barking up the wrong tree.

Transfer of "wealth" if done properly helps the standard of living in aggregate and improves on mobility and innovation opportunities. And investments may not be in just production... investments in education and healthcare which has a much longer gestational period raises aggregate productivity markedly as well. But these are inititatives that profit seeking business enterprises will not do, and the state has to do it for the greater good and long term prospects. We can see it in recent history through corporate investment into middle east or Africa. Until the people take control of the state, corporates will not benefit the populace.

So sound investments create real wealth (not asset inflation) but sound investments does not just look at short term profits or wealth, but also longer term benefits. That is why the state need to exist to look after the aggregate needs.

---

(10-10-2013, 03:55 PM)freedom Wrote: As for job opportunities, there are plenty, too. There are still lots of Mexicans coming to US for jobs. So how could we say there isn't job for Americans?

The mexicans don't consume primarily in US. The locals are stuck in the high cost of living and hence needed higher paid and hence higher value add jobs.

That's the same issue with Singapore. We also need to level the playing ground on this.

The Aussies "solve" the labour mismatch with higher labour cost. What will be our solution?

(10-10-2013, 04:04 PM)Clement Wrote:

(10-10-2013, 03:55 PM)freedom Wrote: I recognize that wealth transfer is necessary. At least the disabled ones receive wealth from someone else.

Today, problem in US is not about minimum necessary, but how much more should the riches be taxed to transfer to the poor?

As for there isn't enough opportunities for business investment in US, I don't believe it. Is US so advanced that it does not require any further improvement in anything? As for job opportunities, there are plenty, too. There are still lots of Mexicans coming to US for jobs. So how could we say there isn't job for Americans?

Well, i do think there should be higher taxes on the rich, but not to distribute more to the poor. The US is now deeply divided and i do think that there needs to be a sense of shared sacrifice to bring the fiscal house in order. But to cut entitlements now would be a death sentence to many who depend on it and would probably derail the US economic recovery. In the end, i think entitlement cuts are necessary, given the stupid execution of their social security system in the past, but it has to be done together with higher taxes.

Entitlement cut is always painful. Ask Spaniards and Greeks. The solution is not more and continued entitlement, but to join the workforce.

There was a time when everyone hates entitlement so much that they preferred working multiple jobs.

What the government really should do to help the poor is to reduce minimum wage and subsidising the business owners to employ Americans. At least it's much better than to simply distribute the money and letting the Mexicans take the jobs.

As for tax raise now, I am always against it. The tax is high enough for the riches and middle class. They should cut it, and encourage business investment.

(10-10-2013, 04:29 PM)freedom Wrote:

(10-10-2013, 04:04 PM)Clement Wrote:

(10-10-2013, 03:55 PM)freedom Wrote: I recognize that wealth transfer is necessary. At least the disabled ones receive wealth from someone else.

Today, problem in US is not about minimum necessary, but how much more should the riches be taxed to transfer to the poor?

As for there isn't enough opportunities for business investment in US, I don't believe it. Is US so advanced that it does not require any further improvement in anything? As for job opportunities, there are plenty, too. There are still lots of Mexicans coming to US for jobs. So how could we say there isn't job for Americans?

Well, i do think there should be higher taxes on the rich, but not to distribute more to the poor. The US is now deeply divided and i do think that there needs to be a sense of shared sacrifice to bring the fiscal house in order. But to cut entitlements now would be a death sentence to many who depend on it and would probably derail the US economic recovery. In the end, i think entitlement cuts are necessary, given the stupid execution of their social security system in the past, but it has to be done together with higher taxes.

Entitlement cut is always painful. Ask Spaniards and Greeks. The solution is not more and continued entitlement, but to join the workforce.

There was a time when everyone hates entitlement so much that they preferred working multiple jobs.

What the government really should do to help the poor is to reduce minimum wage and subsidising the business owners to employ Americans. At least it's much better than to simply distribute the money and letting the Mexicans take the jobs.

As for tax raise now, I am always against it. The tax is high enough for the riches and middle class. They should cut it, and encourage business investment.

You see? That's where we differ. You are of the mind that economic growth is the most important factor the the government has to watch. I am of the mind that there needs to be a sense of shared sacrifice. Trickle down economics has been tried and this is the result.

In the end, i don't believe that the rich should be able to use threats to close down or pack up and move to get the government to pursue policies that they would not be able to get the votes for in the political sphere. The US is a democracy after all.

"economic growth is the most important factor the the government has to watch"

That is the mindset of the Singapore government on their 7m population white paper. I'm pretty sure most Singaporeans disagree.

(10-10-2013, 04:15 PM)specuvestor Wrote:

(10-10-2013, 02:47 PM)freedom Wrote: I realize that often our discussion derails to somewhere I believe non-essential.

In most of my discussion, I ignore those disabled ones. The disabled ones are really the minority in the society, less than 1%, I guess. They are well taken care and do not consume most of the government spending. I am not including the elder/retired ones, they are supposed to be mostly funded by themselves when they were young and able. The less able ones I refer to are those unemployed adults or those adults who "give up" their seek of employment.

Another question from me is that how more consumption on basic need and food benefits the society more than the business investment made by the riches? I heard the argument too many times, but I haven't seen a convincing argument yet. My simple understanding is that the human/society progress centers on technology and investment, which are not basic consumption or food.

Ultimately, if we trace the owners of the tax revenue, mostly are still from the riches. The riches do business investment, which creates jobs and income for the general population, which enables them to pay payroll tax and other taxes and consume other products and services. Of course, I am not saying that the riches provides 100% of the tax revenue. But the origin of the tax revenue often traces back to the riches partly. Or think from another perspective. If we remove the business investment from the riches, the economy provided by the government is much smaller, so is the tax revenue.

So I assume we are agreeable on Medishield and Obamacare?

Those able adults and unemployed adults should have opportunities to find work. When the society failed to do that like Greece now, you would have a massive brain drain. Of course everything has its price, including willingness to work. If we pay them $100k for doing nothing, a lot of people will not work. Tricky part is how much to provide them such that they have sufficient income to survive and "pursue their happyness". That's why US is always talking about job creation. What policy makers should be wary of are those pampered ones that refuse to work which are not non-existant but very minority.

If these people cannot have their basic needs fulfilled, how are they able to unleash potentials for greater value add work like technology and services? (think Maslow's hierarchy of needs) Firstly satisfy the basic needs, then create opportunities for greater heights. The society benefits.

Of course the rich pays the most taxes. But if it is that bad, why don't the Londoners leave the City after they hike taxes? Because there are other incentives for them to stay and they benefit when the society as a whole improves. Taxes are one driver, but to simplify it as the main driver for people's decision making is barking up the wrong tree.

Transfer of "wealth" if done properly helps the standard of living in aggregate and improves on mobility and innovation opportunities. And investments may not be in just production... investments in education and healthcare which has a much longer gestational period raises aggregate productivity markedly as well. But these are inititatives that profit seeking business enterprises will not do, and the state has to do it for the greater good and long term prospects. We can see it in recent history through corporate investment into middle east or Africa. Until the people take control of the state, corporates will not benefit the populace.

So sound investments create real wealth (not asset inflation) but sound investments does not just look at short term profits or wealth, but also longer term benefits. That is why the state need to exist to look after the aggregate needs.

Actually, I still did not know your standing on MediShield or ObamaCare.

As I mentioned earlier, the concept is one thing, the execution is another. The republicans and the democrats differs on the funding of ObamaCare, not the concept of ObamaCare.

If ObamaCare is funded like CPF MediShield, there would not be problems for the Republicans. Sadly, that's not happening in US. The democrats want the business and the government pay more for ObamaCare and the individual being insured pays less. How is it going to work in the long term?

Quote:Transfer of "wealth" if done properly helps the standard of living in aggregate and improves on mobility and innovation opportunities.

Please elaborate more on this. Thanks. And how does US government do it properly? If not done properly, should it be the fault of the riches and the middle class so that they should be taxed more?

Investment is always for production barred stupid investment, either in the long term or short term. I never say that government spending on infrastructure or education or defense is less capitalism, but socialism. But waste money on infrastructure or education or defense is not capitalism.

---

(10-10-2013, 04:36 PM)Clement Wrote:

(10-10-2013, 04:29 PM)freedom Wrote: Entitlement cut is always painful. Ask Spaniards and Greeks. The solution is not more and continued entitlement, but to join the workforce.

There was a time when everyone hates entitlement so much that they preferred working multiple jobs.

What the government really should do to help the poor is to reduce minimum wage and subsidising the business owners to employ Americans. At least it's much better than to simply distribute the money and letting the Mexicans take the jobs.

As for tax raise now, I am always against it. The tax is high enough for the riches and middle class. They should cut it, and encourage business investment.

You see? That's where we differ. You are of the mind that economic growth is the most important factor the the government has to watch. I am of the mind that there needs to be a sense of shared sacrifice. Trickle down economics has been tried and this is the result.

In the end, i don't believe that the rich should be able to use threats to close down or pack up and move to get the government to pursue policies that they would not be able to get the votes for in the political sphere. The US is a democracy after all.

What shared sacrifice are we talking about? So far, I see most of sacrifice are from the riches and the middle class. I ain't see much sacrifice from the poor. They are poor for a reason, but not because other people are rich. So the shared sacrifice is to let the rich and the middle class sacrifice even more?

So the poor can complain and complain. But the riches can't even voice their disappointment? What a wonderful world we live in.

The rich are guilty of their richness?

(10-10-2013, 04:44 PM)freedom Wrote:

(10-10-2013, 04:15 PM)specuvestor Wrote:

(10-10-2013, 02:47 PM)freedom Wrote: I realize that often our discussion derails to somewhere I believe non-essential.

In most of my discussion, I ignore those disabled ones. The disabled ones are really the minority in the society, less than 1%, I guess. They are well taken care and do not consume most of the government spending. I am not including the elder/retired ones, they are supposed to be mostly funded by themselves when they were young and able. The less able ones I refer to are those unemployed adults or those adults who "give up" their seek of employment.

Another question from me is that how more consumption on basic need and food benefits the society more than the business investment made by the riches? I heard the argument too many times, but I haven't seen a convincing argument yet. My simple understanding is that the human/society progress centers on technology and investment, which are not basic consumption or food.

Ultimately, if we trace the owners of the tax revenue, mostly are still from the riches. The riches do business investment, which creates jobs and income for the general population, which enables them to pay payroll tax and other taxes and consume other products and services. Of course, I am not saying that the riches provides 100% of the tax revenue. But the origin of the tax revenue often traces back to the riches partly. Or think from another perspective. If we remove the business investment from the riches, the economy provided by the government is much smaller, so is the tax revenue.

So I assume we are agreeable on Medishield and Obamacare?

Those able adults and unemployed adults should have opportunities to find work. When the society failed to do that like Greece now, you would have a massive brain drain. Of course everything has its price, including willingness to work. If we pay them $100k for doing nothing, a lot of people will not work. Tricky part is how much to provide them such that they have sufficient income to survive and "pursue their happyness". That's why US is always talking about job creation. What policy makers should be wary of are those pampered ones that refuse to work which are not non-existant but very minority.

If these people cannot have their basic needs fulfilled, how are they able to unleash potentials for greater value add work like technology and services? (think Maslow's hierarchy of needs) Firstly satisfy the basic needs, then create opportunities for greater heights. The society benefits.

Of course the rich pays the most taxes. But if it is that bad, why don't the Londoners leave the City after they hike taxes? Because there are other incentives for them to stay and they benefit when the society as a whole improves. Taxes are one driver, but to simplify it as the main driver for people's decision making is barking up the wrong tree.

Transfer of "wealth" if done properly helps the standard of living in aggregate and improves on mobility and innovation opportunities. And investments may not be in just production... investments in education and healthcare which has a much longer gestational period raises aggregate productivity markedly as well. But these are inititatives that profit seeking business enterprises will not do, and the state has to do it for the greater good and long term prospects. We can see it in recent history through corporate investment into middle east or Africa. Until the people take control of the state, corporates will not benefit the populace.

So sound investments create real wealth (not asset inflation) but sound investments does not just look at short term profits or wealth, but also longer term benefits. That is why the state need to exist to look after the aggregate needs.

Actually, I still did not know your standing on MediShield or ObamaCare.

As I mentioned earlier, the concept is one thing, the execution is another. The republicans and the democrats differs on the funding of ObamaCare, not the concept of ObamaCare.

If ObamaCare is funded like CPF MediShield, there would not be problems for the Republicans. Sadly, that's not happening in US. The democrats want the business and the government pay more for ObamaCare and the individual being insured pays less. How is it going to work in the long term?

Quote:Transfer of "wealth" if done properly helps the standard of living in aggregate and improves on mobility and innovation opportunities.

Please elaborate more on this. Thanks. And how does US government do it properly? If not done properly, should it be the fault of the riches and the middle class so that they should be taxed more?

Investment is always for production barred stupid investment, either in the long term or short term. I never say that government spending on infrastructure or education or defense is less capitalism, but socialism. But waste money on infrastructure or education or defense is not capitalism.

---

(10-10-2013, 04:36 PM)Clement Wrote:

(10-10-2013, 04:29 PM)freedom Wrote: Entitlement cut is always painful. Ask Spaniards and Greeks. The solution is not more and continued entitlement, but to join the workforce.

There was a time when everyone hates entitlement so much that they preferred working multiple jobs.

What the government really should do to help the poor is to reduce minimum wage and subsidising the business owners to employ Americans. At least it's much better than to simply distribute the money and letting the Mexicans take the jobs.

As for tax raise now, I am always against it. The tax is high enough for the riches and middle class. They should cut it, and encourage business investment.

You see? That's where we differ. You are of the mind that economic growth is the most important factor the the government has to watch. I am of the mind that there needs to be a sense of shared sacrifice. Trickle down economics has been tried and this is the result.

In the end, i don't believe that the rich should be able to use threats to close down or pack up and move to get the government to pursue policies that they would not be able to get the votes for in the political sphere. The US is a democracy after all.

What shared sacrifice are we talking about? So far, I see most of sacrifice are from the riches and the middle class. I ain't see much sacrifice from the poor. They are poor for a reason, but not because other people are rich. So the shared sacrifice is to let the rich and the middle class sacrifice even more?

So the poor can complain and complain. But the riches can't even voice their disappointment? What a wonderful world we live in.

The rich are guilty of their richness?

Well in a democracy, that's how it works isn't it? Rich or poor get 1 vote, and the government should pursue the policies wanted by the majority. I don't see the need for economic growth to be sacred enough to override the system in place.

The rich do have the right to voice their concerns, they get to vote too (and a lot of other things but never mind that) but if their position scores less votes, then they just have to put up with it like everyone else.

The way you'd like it seems to be that you only get to vote if you pay taxes.

(10-10-2013, 05:00 PM)Clement Wrote: Well in a democracy, that's how it works isn't it? Rich or poor get 1 vote, and the government should pursue the policies wanted by the majority. I don't see the need for economic growth to be sacred enough to override the system in place.

The rich do have the right to voice their concerns, they get to vote too (and a lot of other things but never mind that) but if their position scores less votes, then they just have to put up with it like everyone else.

The way you'd like it seems to be that you only get to vote if you pay taxes.

That's only fair, isn't it?

If you are going to spend my money, you'd better have me in the decision how you are going to spend my money.

The freeloaders, sorry, you have no right to how my money should be spent.

(10-10-2013, 05:07 PM)freedom Wrote:

(10-10-2013, 05:00 PM)Clement Wrote: Well in a democracy, that's how it works isn't it? Rich or poor get 1 vote, and the government should pursue the policies wanted by the majority. I don't see the need for economic growth to be sacred enough to override the system in place.

The rich do have the right to voice their concerns, they get to vote too (and a lot of other things but never mind that) but if their position scores less votes, then they just have to put up with it like everyone else.

The way you'd like it seems to be that you only get to vote if you pay taxes.

That's only fair, isn't it?

If you are going to spend my money, you'd better have me in the decision how you are going to spend my money.

The freeloaders, sorry, you have no right to how my money should be spent.

Well, the the ideas in Atlas Shrugged are nice but unrealistic. There is no Galt's Gulch where the rich get to isolate themselves. The rich have the most to lose in the event of a loss of social stability.

More importantly, success does not come in a vacuum, the internet companies are built on work done by the US government, some technologies that led to smartphones too. The US financial services industry is built on strong property rights and rule of law. All these are underpinned by the political and social stability in the US. I believe that the rich should "invest" in the stability by paying their taxes.

Pure uncontrolled capitalism has had it's day in the US gilded age. The days of company towns and mercenary strikebreakers are behind us.

(10-10-2013, 05:28 PM)Clement Wrote:

(10-10-2013, 05:07 PM)freedom Wrote:

(10-10-2013, 05:00 PM)Clement Wrote: Well in a democracy, that's how it works isn't it? Rich or poor get 1 vote, and the government should pursue the policies wanted by the majority. I don't see the need for economic growth to be sacred enough to override the system in place.

The rich do have the right to voice their concerns, they get to vote too (and a lot of other things but never mind that) but if their position scores less votes, then they just have to put up with it like everyone else.

The way you'd like it seems to be that you only get to vote if you pay taxes.

That's only fair, isn't it?

If you are going to spend my money, you'd better have me in the decision how you are going to spend my money.

The freeloaders, sorry, you have no right to how my money should be spent.

Well, the the ideas in Atlas Shrugged are nice but unrealistic. There is no Galt's Gulch where the rich get to isolate themselves. The rich have the most to lose in the event of a loss of social stability.

More importantly, success does not come in a vacuum, the internet companies are built on work done by the US government, some technologies that led to smartphones too. The US financial services industry is built on strong property rights and rule of law. All these are underpinned by the political and social stability in the US. I believe that the rich should "invest" in the stability by paying their taxes.

Pure uncontrolled capitalism has had it's day in the US gilded age. The days of company towns and mercenary strikebreakers are behind us.

Maybe you should state clearly what you are trying to say about the debt ceiling. The cause, the solution?

I can't get what you try to express. One time you say entitlement cut, but raise tax? is it contradicting?