Wealth is not
created by "priming the economic pump" in which unearned money is handed to companies based upon the will of a few people. Wealth is created in the minds of great individuals who have the courage to take risks and act on vision.
It would appear at first glance that taking money from those who have earned it and handing it to businesses to do tasks which otherwise no other person or organization would otherwise fund, could stimulate the economy. Setting aside the fact that a large majority of the work being created through the present day stimulus will not actually happen for well over a year from the day it is mandated, the fact is that wealth comes not from just creating jobs, but sustainable revenue over an extended period of time. This is what is meant by making money.
Sustainable revenue means sustainable demand; so to make money is truly that - the creation of wealth through producing products people desire. Throwing money at individual projects is not making money, it is simply spending money.
Take for example Microsoft. Using the stimulus logic of both the Obama and Bush administrations, asking Bill Gates to produce a million calculators that which people may or may not find value would move a stagnant economy into prosperity. Yet, look at history. If all Bill Gates did was design and produce calculators, at best it would provide relatively few jobs for a short time. True wealth, and the resulting increase in new jobs, would not be created.
At worst, the result would have been not just relatively few jobs; but the production of products that would flood the market, drive down profits, and be a net loss of income overall within the economy.
Yet, as history has shown us, when new products are introduced into the market that fill or create a demand, sustainable revenue and therefore jobs, are created. This is true stimulus and wealth creation, not just simple spending.
Looking again at the Microsoft example, when Bill Gates had a vision of putting a personal computer in every home, he mapped a path as to how this could be accomplished. What was the result? An information technology career path for millions of people that still exists today, and which has never existed in history. This is genuine stimulus, not spending for the sake of spending.
So this begs the question, if throwing money at companies to produce things that no single person or other private entity would fund, then what is the answer? The answer is to allow people to reap as much of the benefits of their innovation and willingness to take on risk as much as possible. The higher the reward for innovation, the more innovation will thrive and the more willing people will be to take risks. And the more innovation and risk taking, the higher likelihood a product or service will be brought to market that will be in demand, creating new wealth, new jobs, and genuine stimulus.
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Comments: 76
~M
I strongly agree that handing corporations money for nothing creates no long term demand (except the political demands from those corporations for more money). But there is one point I would like to explore.
"... when new products are introduced into the market that fill or create a demand, sustainable revenue and therefore jobs, are created."
That word "demand" refers to people offering money for the product. (Right?) So you are assuming by this statement that the money is in the hands of the people who would like to possess this product. There's the rub. Just because people want some product, perhaps even very strongly, does not mean that they will have the money to offer for that product. Your statement is true only when there is sufficient money throughout the economy, at all levels in the economy, for demand to exist for such new products. When there is not sufficient money in the lower third or half of the population to meet its needs (rent, house payments, medical bills, food, decent clothes) the existence and availability of a desirable new product will not matter. Products which only the wealthy can buy do not create many jobs. It is only products which almost everyone can afford that create many jobs. (See cars, computers, and shoes.) So the best way to enable that demand in your statement is to find some way to get money into the hands of the poor. Without that situation there can be no growth of jobs. (See how WWII ended the depression.)
It's easy to get out of our recession but we aren't willing to do it. We'd rather suffer than give money to the poor. We'll come up with any excuse and believe any lies rather than see a poor family get something for nothing.
If enough products are developed by industry to create a demand the first people to purchase the products are those who can afford them, usually stimulating more production which in turn drives ther price down. We have seen this time and again for everything from cars to smart phones. one thing we have got to do is stop shipping those jobs overseas.
I am willing to accept your judgment on the WWIII thing. I hope you are correct.
Products don't create demand. People with money to spend create demand. Take away the money and the demand goes away. (See the Great Depression.) When people have enough money for discretionary spending then attractive new products "create" demand. We see this time and again. When people are scared that they might lose their job at any time or when they are unemployed they don't buy more than they have to. Demand falls. Unemployment rises even though wonderful new products come to market. The money has to be in the hands of the consumers before the demand can occur.
We tried giving money out twice now with little effect. Unfortunately I don't have a solution, I just don' feel handouts are going to work.
We gave money to the G.I.s after WWII which was instrumental in preventing a return to the Depression. That worked.
We gave money to the rich in 2008. (Which didn't help at all.) We extended unemployment payments which prevented a worse recession / depression. That helped.
Which givings of money out did you have reference to? :-)
Please consider my solution (detailed in the novel "Invisible Hand" available complete both here on Gather (see my profile) and at nopom.info where there's also an MP3 version for listening. It's quite different from all other solutions.
Please review this article I just posted regarding supply and demand of health care. This is my response to your contention that "[[j]ust because people want some product, perhaps even very strongly, does not mean that they will have the money to offer for that product."
My argument here is that where there is a demand, supply will in fact follow. 100%? No, of course not. But more so than one may consider at first glance.
http://www.gather.com/viewArticle.action?articleId=281474979643866
I hope you find the perspective interesting it and offer your thoughts.
Thank you,
John
The people of Ireland during the potato famines often died for lack of food. There can't be much more demand than that from the desire point of view. But they had no money to buy food. If they had possessed the money, Ireland would have been importing food rather than exporting food during those famines.
The same thing is obviously true of medical care. No matter how much one needs treatment, if someone doesn't pay for that treatment it will not be provided.
Now with regards your post which I have now read.
It illustrates my point perfectly. Since people cannot pay for the service, no matter how desperate the need, the service is not available. In the case cited (Massachusetts ) we see how a state law limiting the amount the state is willing to pay results in doctors leaving the state to practice where they can get higher pay. The service (supply) goes where the money is rather than where the need is. Thus the concept of "demand" is who has the money and is willing to pay rather than who has the need or where would be most benefit be produced. In other words, we shoot ourselves in the foot because of the nature of our money. Those children who need treatment grow up to be dysfunctional adults and cost us lots more money in many ways and lots more suffering in many ways.
(I hope you are reading my novel and finding the perspective interesting. :-)
Thank you so much for sharing your thoughts. First, in regard to the potato famine in Ireland, it is far too simplistic to say that people needed food, they didn't have the money, so they died. The potato famine was more caused by the irrational controls and oppressive nature of the government in Ireland at the time, not so much about the spoiled potatoes. If Catholics were allowed to live equally as everyone else in the country at the time and markets were allowed to work as they do, the effect of the loss of such a key crop would have certainly been less severe.
People can buy health insurance and prepare for the worst by saving their money. If someone has the intelligence to buy insurance, then they do not have to save a $500k for a possible emergency operation. A reasonable amount can be put aside knowing that insurance will be there to pick up the bulk of the expense in the small chance it is needed.
I am sure you know this, it is common sense. What most people's reply is, "what if they do not have insurance" . . . well, stupid people do stupid things all the time. No law or government transfer of wealth is going to change it. In fact, it can only make it worse.
And THAT is what we are seeing today in Massachusetts. Thanks to the "reforms" imposed by politicians who care more about gaining power and influence more than anything else, we have a system that give less access to care at a higher cost. Much like our school systems that absorb more and more money out of productive society with poorer and poorer results.
Yes, doctors are leaving the state. Why? Read here. I know you have read the article already, but you should read it again! Considering your comment s here I am not sure it sunk in as well as it could.
Where would the money have come from to pay for the food to give the starving poor? Who would have provided it? I quite agree that the government in Ireland was oppressive but why would the government have prevented the distribution of food to the poor? (Remember that the government then, as now, was controlled by big money interests.)
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Many people cannot buy health insurance. They may be too poor or be too poor a risk. Insurance companies do not exist to improve the nations health, they exist to grab as much of the nation's wealth as possible. One can only do these reasonable things if one has the resources and the good luck to not have those nasty pre-existing conditions.
To blame those who lack of insurance is to blame the victim. Also, keep in mind that many people who have had insurance have still be bankrupted by ill health which the insurance did not cover for whatever reason. Many times the insurance company so delayed payment that was warranted that the patient died. Again, the insurance company exists to get money, not to pay for their customers' good health.
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Just because I did not accept the conclusions that you have drawn or that the author of the article presented does not mean that I do not understand.
The answer to this question is the free market. What you are arguing is that this (under a different scenario, but the facts and results are the same):
Not everyone has food. People who do not have enough food are victims; we must do something about it. So what we are going to do is grant the right to government to tell the farmers, transporters, and grocery stores what to sell, how to sell it, and what to charge. People have to buy this food, they cannot fish or hunt for their own because that money will not be able to be used to keep costs down. By doing this, you reason, prices will go down and access to food will increase.
Do you seriously believe this will be a better situation then we have today??? Where I can go to the local A&P at 3AM and buy a six pack of 12 ounce cans of Diet Cherry Coke for about $1.99?
I want the system in which the access to things are greatest in order to help everyone, just as you. We can do this by both creating the greatest opportunity to access health care just as we have today for food and continue to maintain the value system America possess and has made us great.
The results of what you advocate will result in less access to care and the severe degradation of American values.
If you actually want a system in which access to health care is at its greatest you will like the system I propose. There's no insurance because none is needed by anyone. Doctors treat whom they want and patients go to whatever doctors they choose. So long as its what both doctor and patient want, it's not the concern of anyone else. Doctors get paid for the net benefits of their actions just like everyone else. You just can't get any better access than that. You see my system is a true free market, not the pretend free market that we are cursed with now.
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Why assume that the government has force the providing of food? Wouldn't just offering money to those who provide the food be enough? What to the food providers care who pays so long as someone does? Then the question is who is to provide the money to pay for that food. Do you have a solution for that? My system has solved the problem. I don't think any government can solve it without forced taxation.
Please provide support for your statement: "The results of what you advocate will result in less access to care and the severe degradation of American values." Provide my statement(s) showing what I advocate and describe how that will result in less access and the degradation.
1. "To blame those who lack of insurance is to blame the victim."
and
2. I don't think any government can solve it without forced taxation.
If you are advocating for a free market solution, then we agree. But that is not the impression I've received so far.
On point 1.: I don't see any implication of government nor government action. Can you provide more explanation of how this statement advocates?
On point 2.: I am here trying to indicate that there is no satisfactory solution unless we change the nature of our money. I give my opinion that we have the government stand idly by while people suffer and die for lack of medical care or have the government extort taxes from the population to pay for medical care. There does not appear to be any third option. I find both these options unsatisfactory. I much prefer my solution which involves completely free markets made possible by a fundamental change in the nature of our money.
(I get a lot of abuse when I point out the inadequacy of all proposed solutions to the common problems of all national economies when I am trying to show that the problems cannot be solved without some change such as the one I suggest. Thus, there's need for any apology since I can't expect you to correctly interpret my motives even when I explicitly state them. That's not your fault at all. :-)
Point 1: People who do not have something are not victims. If I do not have a TV, am I a victim?
Point 2: Life isn't fair Larry. No legislation or power to the government is going to change that.
After reading your article on free markets, I am understanding more about your point regarding money. I understand it more, but I still do not agree. Money is just a convenient means of exchanging value for value. It is not the problem.
Point 1: If you die for lack of something that is in plentiful supply then you are a victim. One can be a victim of neglect as well as a victim of purposeful attack. Of course my answer depends on my meaning of "victim" and yours may be different.
Point 2: I quite agree that life isn't fair. I have had lot's more good luck than I deserve. But then I am not arguing that life be made fair nor am I arguing that life can be made fair. I am arguing that life can be greatly improved via a relatively simple change which will help everyone.
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Poverty is a problem. Inflation/deflation is a problem. Unemployment is a problem. Organized crime is a problem. Government oppression is a problem. War is a problem. Now if all these problems cease if a simple change is made to the nature of our money, wouldn't you say that the nature of our money is the root of all these problems?
Money is far more than a convenient means of exchanging value for value. It affects how we see the world. Money transactions are two party interactions in that the money passes from one party to another party. Two party interactions are inherently unstable in that a power advantage can be used to gain a still greater power advantage. Eventually, the weaker party will attempt to stop the interaction. This happens even in marriage but is particularly characteristic of economies which use a physical object money (POM).
POM simulates falsely a zero-sum game in that the money gained by one must be lost by others. (I know the amount of money is variable but this is what our money simulates.) Therefore we perceive our relationships to others as a win/lose situation with everyone else as the rival, the opponent, the enemy. This false impression leads to resentment of others' success and pleasure is others' failures.
A POM is amoral. It can be used for any purpose good or bad. This means that there is nothing to stop its being used for war, organized crime, or oppression for example.
A POM can be taken from you against your will and everyone who wants to gain money is motivated therefore to take your money against your will. Thus we get taxes, robbery, theft, fraud, extortion, and so forth. The nature of our money makes these things not only possible but inevitable. If almost all functional adults are motivated to do evil to gain money, a large number will yield from time to time to that temptation. Therefore, the money will, in that sense, cause that evil.
No, when you die from something that is in plentiful supply you prove Darwin right.
"Now if all these problems cease if a simple change is made to the nature of our money, wouldn't you say that the nature of our money is the root of all these problems?"
No. Answer me this, what is the root of all money? Your response that money is a conduit to "[t]wo party interactions are inherently unstable in that a power advantage can be used to gain a still greater power advantage" is wrong. As you already stated, dishonestly, thievery, and therefore "instability" existed prior to the invention of money. So again, I ask, what is the root of all money?
"A POM is amoral It can be used for any purpose good or bad. This means that there is nothing to stop its being used for war, organized crime, or oppression for example."
Larry, let's say that we do not use money. We barter for everything. These items used for barter are still amoral and can use used for good and bad purposes. You're entire premise can be used to draw a number of conclusions, not just the one you believe it does.
"A POM can be taken from you against your will and everyone who wants to gain money is motivated therefore to take your money against your will."
And this us not true in a world where all we do is exchange goods? If I live in castle I exchanged for 400 pounds of gold I dug up, no one in the world will be jealous or be motivated to take what is mine? You are not making any sense at all Larry.
Taxes existed before money Larry. They just take your sheep, chairs, or whatever else you produce.
The fact is that health care is not produced and administered by machines, it is produced and administered by people. Those people have the same right to reap the benefits of their mind and efforts as everyone else. No one is a victim if they choose not to help them because no person's needs are a mortgage on another person's life. This is true with the ship builder, the artist, the writer, and yes, even the health care worker.
You wrote:
"No, when you die from something that is in plentiful supply you prove Darwin right."
Children who are born to poor parents deserve to be taken out of the gene pool? Is that what you are saying? Elderly people who have worked hard for 50 years supporting their families and now have fallen on hard times deserve to die? Is that what you mean?
Or do you mean that people who starve should have stolen what they needed. If they were fast enough to run out of the store with their loot before they could be caught then they deserved to live? Is that what your mean?
Or do you mean that they should have found some swindle or perhaps have gotten a job with organized crime as a way out of poverty.
For some reason your quote sounds very cold and unfeeling to me.
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You wrote:
"As you already stated, dishonestly, thievery, and therefore "instability" existed prior to the invention of money. So again, I ask, what is the root of all money?"
I have no idea what you are asking here. Please explain. The two sentences seem to me to have nothing to do with each other.
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You wrote:
"...items used for barter are still amoral and can use used for good and bad purposes."
Absolutely right. Physical objects are amoral. They can still be used for good and bad purposes. But do you really want money to be able to be used for bad purposes as well? Why use a money which is amoral when it isn't necessary? Wouldn't a moral money be an improvement?
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I wrote: "A POM can be taken from you against your will..."
You wrote: "And this us not true in a world where all we do is exchange goods?"
Goods are physical objects. They can be taken from you against your will. So why do you want to use a money which can be taken from you against your will? Wouldn't it be better to possess money which only you could spend and which no one could take from you?
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You wrote:
"Taxes existed before money Larry. They just take your sheep, chairs, or whatever else you produce."
If this becomes an important point I will return to it.
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You wrote:
"The fact is that health care is not produced and administered by machines, it is produced and administered by people. Those people have the same right to reap the benefits of their mind and efforts as everyone else. No one is a victim if they choose not to help them because no person's needs are a mortgage on another person's life. This is true with the ship builder, the artist, the writer, and yes, even the health care worker."
I think this paragraph is a very good example of how the nature of our money shapes how we think about our situations in life. I will attempt to direct your attention to certain assumptions that your paragraph indicates.
It seems to assume that medical services can be paid for only by the persons receiving the services. It seems to assume that medical service personnel will not be compensated for helping those in need of medical services if those persons are poor. I suggest that such a point of view reflects the two party interactions typical of a POM.
Next, there is the implication that medical care personnel might be compelled to provide their services to the needy. POM economies have means of forcing persons to perform services from slavery to the law to threats of being fired. A non-POM economy has no means to force people to provide services. Individuals may attempt to use force (a gun for example) to compel the performance of services but preventing such actions would be rewarded with a non-POM economy. In a POM economy, the private property of individuals is frequently taken against their will with eminent domain and sale for taxes prominent examples. In a non-POM economy, the community never takes private property. Sure in a non-POM economy some individual may steal the property of someone else but possession of that property is evidence of guilt and the property cannot be sold to gain money. So theft of property is relatively rare. (Non-POM is just an improvement, it is neither perfect nor does it make people perfect.)
Now think about what would happen in a non-POM economy when people (poor or otherwise) are in need of medical services. Providing those services when needed will earn money for those providing those services. This is true regardless of whether the patient has any money of their own or not. The need of one person for medical services is an opportunity for anyone who can provide appropriate treatment to earn money. The free market relationship between those who produce (as in medical services) and those who pay them for the benefits of those services assures that the services are optimized. (I am sure you are aware of how wonderfully efficient free markets are at allocating resources with no individual or organization telling anyone what to do.)
Therefore, though it is entirely possible in cases of disaster that there would be some people who were in need of treatment they did not receive, in ordinary circumstances, everyone in need of treatment would receive it. This would especially apply to children. And this desirable state would not be the result of compulsion nor taxation nor the application of force or the threat of force. It would be the result of a non-POM.
Well, that is because it is, but note I am going off your contention that such resources are plentiful. If a person is surrounded by fresh clean water and dies of dehydration, that seems to be only one person's fault - the person who didn't take the drink. They are not a "victim".
My point is that health care resources are not plentiful, they are scarce. The question then is how are such scarce resources to be utilized so that access is as great as it possibly can be? The answer to this questions I found in the article above as well as my article on the Massachusetts pediatric mental health care provider shortage.
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I am asking you to define the root of all money. Why do we have money? How is its exchange for goods any different from a barter system?
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"...items used for barter are still amoral and can use used for good and bad purposes."
Absolutely right. Physical objects are amoral. They can still be used for good and bad purposes. But do you really want money to be able to be used for bad purposes as well? Why use money which is amoral when it isn't necessary? Wouldn't a moral money be an improvement?
This does not make any sense Larry. If we agree that physical objects are amoral, then there is no “moral money” and so you are suggesting an improvement that cannot exist in reality.
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In a non-POM economy, what is the money? If it is not physical, what is it?
Let’s say they are credits. Nothing POM about that, is there? Just zeros and ones floating out in cyber space without a physical presence. This is pretty much what we have today, yet we still have scarce resources and people go without health care. How is that possible Larry?
We have plenty of food in the U.S. and there are millions of U.S. children going to bed hungry tonight. It seems to me that they are victims.
The resources for basic health care are plentiful. At the "bleeding edge" of technology, resources are expensive. In between it varies as when the drug manufacturers don't make enough of some drug or other. It seems to me that the basic medical care is in sufficient supply that those who are denied that service are victims. (See poor kids again.)
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You wrote:
"I am asking you to define the root of all money. Why do we have money? How is its exchange for goods any different from a barter system?"
I am delighted you asked that. It's something I enjoy writing about. :-)
The barter system is a clear win/win system in which both parties to the trade are better off for having made the exchange. But such trades, though beneficial to both parties may be difficult to find. If you have a coonskin hat to trade and need a good shirt and pants, it may be tough to locate someone with an extra shirt and pants that will fit you and who needs a coonskin hat. This makes trade more difficult. It also makes specialization much more difficult.
Now consider the situation if there is a medium of exchange (say salt). Anyone will accept salt in trade. Everyone has to have salt. It has many uses, lasts forever (if you keep it dry), and can be measured into any fractional amount desired. So even if you don't need any more salt just now you will accept it in trade because you can always use it later.
Now let's say you are a specialist in working leather. You can practice your trade accepting salt from your customers for your leather products and paying for your raw materials with salt. You can buy everything you need using the salt. Sure you can still do barter trades if you like but your customers can always "fall back" on salt. By using salt as the medium of exchange everyone in the village can specialize to improve efficiency and increase production. This is the root of all the various kinds of POM. It makes trade easier, increases the division of labor, and increases production.
Money also allows one to compare the relative value of various objects. One can say that a shirt is worth 5 ounces of salt, the pants are worth 4 ounces of salt, and a coonskin hat is worth 9 ounces of salt. Thus the concept of price comes into existence. You can't express prices without a standard unit of account.
Money has been a good thing despite its faults.
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You wrote:
"If we agree that physical objects are amoral, then there is no “moral money†and so you are suggesting an improvement that cannot exist in reality."
But it is not necessary that money represent a physical object. This is the crucial difference between the money I propose and all other forms of money. All we need for a medium of exchange, a standard unit of account, and a store of value is records. If you have an account with an amount of money, it is not necessary that the money came from anywhere nor that it continue to exist when you spend it. All that is necessary is that the number there increase when you earn more money and decrease when you spend some of that money. If your account increases when you do something that benefits others and decreases when you buy something, that is enough to provide all the functions of money.
You are quite correct that the vast majority of the money in the world today is merely records on computers. But we treat that money as if it were physical objects. It is because this account money can be taken from us against our will. It is amoral. Its supply is independent of the supply of goods and services for sale. Its use simulates a zero-sum game relationship. Its transactions are two party transactions. It is uncontrollable. It is transferable to others. In other words it is still a POM.
Didn't you visit my web site and read the overview on the home page? Didn't you see the section near the end on the payers? The payers are why the money is moral. They are the sole means to gain money. They are moral because they are human beings and because their situation entices and compels them to pay in a moral fashion such that one can gain money only by doing good for others. That is how it is possible.
And this is the fault of the food producers of their parents?
The resources for basic health care are plentiful . . . (See poor kids again.)”
If this is true, whose fault is it? The ones providing it in a “plentiful” fashion or the parents who are not providing a “plentiful” something to their children?
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In the example you use, what is the difference between salt and money? If what you say is true, that ”Anyone will accept salt in trade. Everyone has to have salt. It has many uses, lasts forever (if you keep it dry), and can be measured into any fractional amount desired. So even if you don't need any more salt just now you will accept it in trade because you can always use it later.” then it IS MONEY.
Just replace the word “salt” for “money” and what you state still holds true Larry. This is true throughout the entire rest of your comments above. Except salt is unbelievably less convenient. I want to sell my car, so someone offers me a ton, 2,000 pounds, of salt. Okay, now I have enough salt to last me three lifetimes and I have to put it somewhere. How do they get it to me? How do I exchange more of my property if I already have more than enough of the commodity used to make a purchase? Everyone needs salt, but more than a ton? Not really.
And this is true with any item you pick Larry.
I am not asking whom to blame for hungry children. I claim hungry children are victims in a society with more than enough food. I am not asking whom to blame for children in need of medical care not receiving that care. I claim they are victims.
It seems pretty silly to blame poor parents for being poor. I don't really think they decided to be poor, I think it was thrust on them by circumstance, luck, and the nature of our money. Poverty in an industrialized nation is totally unnecessary.
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In the example I use salt is money. That is the origin of our word "salary" and the phrase "not worth his salt." For a time the Romans used salt as their money. I was answering your questions:
"I am asking you to define the root of all money. Why do we have money? How is its exchange for goods any different from a barter system?"
I was showing how a money, in the case of salt a commodity money, was different from a barter system. How it improved trade by providing the three functions of medium of exchange, standard unit of account, and store of value.
There are any number of commodities which can function as commodity money. Brandy and cigarettes have served in that capacity in the 20th century when hyper-inflation afflicted Germany. But coins and other forms of currency are superior as money even though they cannot be directly consumed.
Are you sure you read my last comment? From your response I get the impression that you did not. Please let me know if you understand about the three functions of money and how they make money superior to barter in economies beyond hunting and gathering in technology.
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Do you understand that the functions of money can be provided without a physical object money? It is possible to have a medium of exchange, a standard unit of value, and a store of value which is not a physical object and is not treated as if it were a physical object. Is that clear to you?
Okay, let’s define a victim:
vic•tim (v k t m) KEY
NOUN:
1. One who is harmed or killed by another: a victim of a mugging.
2. A living creature slain and offered as a sacrifice during a religious rite.
3. One who is harmed by or made to suffer from an act, circumstance, agency, or condition: victims of war.
4. A person who suffers injury, loss, or death as a result of a voluntary undertaking: You are a victim of your own scheming.
5. A person who is tricked, swindled, or taken advantage of: the victim of a cruel hoax.
To claim someone is a “victim†it is obvious that the use of the word requires that the person harmed is acted on by something, most often someone, else. Certainly someone can be a victim of their own actions, but I am sure this is not what you are saying in relation to the children. The point is that where there is a victim, there an entity to be blamed.
It seems pretty silly to blame poor parents for being poor
No one is blaming anyone for being poor. If something is both “plentiful†and important to a child, a parent, no matter his or her income, can provide it. If they don’t, who else are we going to blame? The producer of the product for not handing over for free the results of their work and mind?
You claim that people will provide necessities of life because it feels good to do so, and that some compensation may come about, but if one is not free to sell his or her abilities on the free market (for POM or not) just like the mason and the artist, it is not a free market nor a free society. It is a society of coercion and immorality.
I was showing how a money, in the case of salt a commodity money, was different from a barter system. How it improved trade by providing the three functions of medium of exchange, standard unit of account, and store of value.
The same is true with gold and paper money. Again, the problems you cite are not resolved through the elimination of POM.
Regarding payers. Those who pay are also those who sell and vice versa.
Do you understand that the functions of money can be provided without a physical object money? It is possible to have a medium of exchange, a standard unit of value, and a store of value which is not a physical object and is not treated as if it were a physical object. Is that clear to you?
I am thinking my response is no. If money isn’t physical objects or credits in an electric file, what is it? You mention small things that can easily be transported, but those too are POM.
You might check that third definition. I quote from your quote: "One who is harmed by or made to suffer from an act, circumstance, agency, or condition,". Certainly poverty for these children is a circumstance and a condition. Likewise, these children are certainly harmed by and made to suffer.
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You wrote:
"If something is both “plentiful†and important to a child, a parent, no matter his or her income, can provide it."
How does a parent without funds provide some of that plentiful food? Steal it? They certainly have no money to buy it. Please explain what these millions of poor parents should do. Not pay their rent?
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I claim that people will provide food to the hungry if those providers are paid for doing so. Do you deny the truth of that claim? I do not claim that people will provide the food because it feels good to do so. That is the claim of those who say that private charity should take care of all those poor, hungry children.
If you own a business, are you selling your abilities on the free market? Who pays you? Do you really care who pays you? Does it have to be the people who benefit from your abilities? I say that it does not matter to you who provides the pay so long as you are confident that you will be paid. I say that those who pay in my system are far more dependable in their paying because they have no vested interest to pay unfairly and a great interest in paying fairly. I claim that in my system the free market determines what one is paid. I claim that the free market is very fair and very dependable. It's too bad we have never had one.
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Yes, salt and gold and paper currency are all the same kind of money and work in the same ways and have similar failings. These POM forms of money can be taken from you by force and fraud.
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Payers in my system cannot ever have money nor anything money can buy. Payers in a POM economy both buy and sell (and commit fraud and steal and coerce and so forth).
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You wrote:
"If money isn’t physical objects or credits in an electric file, what is it? You mention small things that can easily be transported, but those too are POM. "
Please read my novel "Invisible Hand" here on Gather (or at my web site where there is also an MP3 version to listen to and no ads). That will explain my system in an easy to understand form. All will become clear and you will enjoy reading it if you are like most people. (There are comments on the chapters with the Gather copy. Please see my profile.)
You make an excellent point Larry. Circumstances can cause someone to become a victim, but not in the case you cite. Again, if something is “plentiful†and important to a child’s health, then it is the parents’ responsibility to provide it. Not me, not the drug companies – the parents. They are creating the victim, not the circumstance.
Again, my point is that such resources are not plentiful, they are scarce.
"If something is both “plentiful†and important to a child, a parent, no matter his or her income, can provide it."
How does a parent without funds provide some of that plentiful food? Steal it? They certainly have no money to buy it. Please explain what these millions of poor parents should do. Not pay their rent?
Today, most of those who are considered poor have cars, cell phones, a roof over their heads, and many other things that are not plentiful. And those that do not are victims of themselves due to drug addiction and other such things. (cite)
I claim that people will provide food to the hungry if those providers are paid for doing so.
And how are you going to do this Larry? The only way is to initiate force against those you feel need to give, right?
I say that those who pay in my system are far more dependable in their paying because they have no vested interest to pay unfairly and a great interest in paying fairly. I claim that in my system the free market determines what one is paid. I claim that the free market is very fair and very dependable. It's too bad we have never had one.
Sorry, I just don’t believe that such things can be accomplished by moving form POM to salt or any mix of small objects (using the word here intentionally, seeing you are saying no physical objects and then cite physical objects as the solution).
I read about as much as I could of your book Larry, it just does not make any sense to me. The question about no POM, no credit, and only some other objects that are objects but not objects is a legitimate inquiry. You should be able to answer it concisely if you have a valid argument. Wouldn’t you agree?
Just because poor children are victims does not mean that you are obligated to do anything. Some people feel an obligation to reduce or eliminate the suffering of others and some do not. That's completely up to you.
But just assigning responsibility to someone else does nothing at all for those poor children and they are victims.
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Are you telling me that there are no poor children? Does the possession of a car mean that the parents are not poor? Does the fact that they have a roof mean that they are not poor? Do you realize that some people need a car to get to their jobs?
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I claim that people will provide food to the hungry if those providers are paid for doing so.
You respond:
"And how are you going to do this Larry? The only way is to initiate force against those you feel need to give, right?"
I have a solution which requires no force at all by anyone. Please read my book. It is explained in detail.
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You wrote:
"I read about as much as I could of your book Larry, it just does not make any sense to me. The question about no POM, no credit, and only some other objects that are objects but not objects is a legitimate inquiry. You should be able to answer it concisely if you have a valid argument. Wouldn’t you agree?"
What stopped you in your reading of my book? What chapters have you read so far?
Your question about objects seems strange to me if you have read the first chapter. Perhaps if you will refer to the passage in the book which is giving you problems I can provide an explanation in different words.
That was the rationalization for the existing governments. Actually, they were created to exploit the citizens more efficiently. (See the Dark Ages.)
But just assigning responsibility to someone else does nothing at all for those poor children and they are victims.
Yet it does assess responsibility.
I have a solution which requires no force at all by anyone. Please read my book. It is explained in detail.
Okay. When I get around to it. But until then, people are either paid because someone wants to pay them or someone is forced to pay them. As long as the person paying is doing so voluntarily, we are in agreement.
Are you telling me that there are no poor children?
No, and you know this.
Does the possession of a car mean that the parents are not poor?
No, not necessarily.
Does the fact that they have a roof mean that they are not poor?
No, not necessarily.
Do you realize that some people need a car to get to their jobs?
Yes, and you know this.
YOU said that health care is plentiful, not me Larry. If it is plentiful, then if you can put a roof over your head, own a car, a cell phone, cable TV, you can buy health care for your children. If a person cannot, that is their fault. Certainly cell phone and cable TV are not necessities.
According to ABC news this evening one child in four in the U.S. cannot be sure of getting enough to eat tomorrow due to poverty. It seems to me that assessing responsibility is not enough. It seems to me that any society which stops with blame and does not see to it that those children are well fed is on the way to destroying itself.
Cell phone and cable TV are far less expensive than food. (But that is beside the point.)
People are poor a large majority of the time in a free and capitalist society to the point where their children are not eating because of substance abuse, mental illness, or pure laziness and stupidity. Not because they are victims of some other person's abuse or society (not necessarily saying this is what you are saying, but that point is important in completing the concept).
The appeal to emotion and the "victim" mentality you are using will not address the issues and only leads (if not you, others) to some un-American effort to extort money from one group to fulfill what another group needs. This only leads to more poverty by making it easier to be addicted or lazy.
One quarter of our children are not getting enough to eat. What should we as a society do about it? I don't want to read any excuses for allowing those children to go hungry. I don't want blame. I don't want political ideology. I want a means whereby those children can be fed regularly and every day with good food. Do you have one to offer?
You see, I think that we as a nation and as a society are responsible for all our children. Given the amount of food we produce I think that we as a nation have no excuse for children going hungry. I don't think blaming the parents feeds the kids. I don't think talking or writing about "victim mentality" feeds the kids. I don't think calling things "un-American" feeds the kids.
I do not have an offer because there is nothing I can say that will go beyond your emotional and subjective position on the subject Larry.
I have already given you my ideas on the cause of the problem and what my solution would be. I was asking for your solution.
You have not provided any solution so far as I can tell. If you provided one about please tell me the time of the comment.
Thanks.
Massachusetts pediatric mental health care provider shortage - the real cause and effect
Supported by:
Health care employment opportunity costs and the inevitable rationing of care
What I see in these two links is one sentence that's relevant:
"What the report neglects to cite is that lower compensation is due to the fact that government, not market forces, is what is driving down such compensation making the benefits to entering into the field minimal."
No indication as to what government action (or inaction) is driving down pay to child mental health providers.
But that's child mental health, not malnutrition for poor children. And your to posts (which I have read before) provide no solution at all that I can see other than "get the government out." (My paraphrase of what I think you mean so it's probably wrong.)
So other than have the government ignore the fact of one quarter of our nation's children not being adequately fed what do you propose the society, the nation, or whoever do to get rid of this problem? I still have seen no solution from you. Please make that solution explicit, not an implication so that I can clearly understand exactly what you mean.
Thanks.
How does one make a profit feeding poor children. The children have little money and cannot pay. The parents are too poor or too irresponsible. WHO PAYS? You seem to exclude the government. No one else is doing it now. Who's money do you propose to use to pay for feeding poor children?
I do not understand your solution at all. Please reduce the level of explanation to grade school so I can understand.
The US is the most charitable country , in the world no on even comes close. And those countries that are next, their charitable contributions are done by the government, not voluntarily by the citizens as it is in the US.
Why is this the case? Because the more free people are, the more they value their lives and the value of others.
Are you saying we don't have a problem with our poor children not getting enough to eat and poor nutrition in most of the food they do get? Are you saying that charity voluntarily given by those better off is taking care of those poor children?
When in history has any nation fed its poor children well via charity? Just one case will do.
No, I am saying the government is not the solution. Freedom is the key.
Are you saying that charity voluntarily given by those better off is taking care of those poor children?
Today? No. Why? Because a government bureaucracy and hand out program has made it more beneficial for people to be on assistance than to go out and be responsible. The problem is so large due to the fact that the system is designed to keep people dependent as opposed to making it worthwhile to work hard and build dignity.
This is not true with all people and families on assistance, but there is no question the numbers are much higher than they would be if people were free to both succeed and fail.
Think about all the great charitable organizations that exist today. Goodwill, Salvation Army, and so many others. All came about when our society had nearly no government handouts.
Every wonder why not a single new one has developed since then? Because government, with its vast waste and inefficiency, has exploded the problem and sent away good people in absolute disgust. And for good reason.
Do you believe we are all equal under the law Larry? Are there any groups of people deserving of less rights than others?
When in history has any nation fed its poor children well via charity? Just one case will do.
The road to hell is paved with good intentions Larry. You are pointing at some fantasy utopia and asking why it does not exist. It doesn't exist because that's life. Period.
For someone who has not read my book you have a great knowledge of what it contains. How did you come by this knowledge?
You imply that there has never been a nation that fed its poor children well via charity but insist that "freedom is the key". Does this mean that there has never been a nation with freedom? That I believe. Yet without any example of a nation that cares for its poor and without any example of a nation which has freedom, you have sublime faith that if we only had freedom charity would feed all the poor children well.
Perhaps if I point out that my solution has the freedom you support with a free market and no government involvement in the economy and it provides plenty of food for everyone including poor children (and adults). My system provides what you claim to want. But you reject my system sight unseen.
You imply that there has never been a nation that fed its poor children well via charity but insist that "freedom is the key". Does this mean that there has never been a nation with freedom?
With freedom? Yes, to some degree but there have been no truly free countries. Maybe the US at its beginning, I am not sure.
Yet without any example of a nation that cares for its poor and without any example of a nation which has freedom, you have sublime faith that if we only had freedom charity would feed all the poor children well.
To repeat myself, the road to hell is paved with good intentions Larry. You are pointing at some fantasy utopia and asking why it does not exist. It doesn't exist because that's life. Period.
The point is that there will always be the ignorant, the weak, the addicted, and the lazy. No law or form of government will ever change that. Prior to the establishment of America there nearly everyone except for a few lucky elites were poor. With the freedom brought on by the American experiment, a middle class was established and the number of "rich" exploded. It was only then when people with, quite frankly I have to be honest with you Larry, naive people such as you started to wonder why anyone was poor.
I have not read you novel but the reason I cannot seem to get motivated is because what you have described to my direct questions has not made much sense. We can't trade salt as money. We can't exist on a complete barter system. Money is not the root of all evil, it is simply a convenient means of exchanging value for value.
My solution is initiated via a law but once in operation, neither law nor government is involved. I tell you that my system is strikingly different from any system either monetary or governmental. Therefore, it not surprising that you do not understand it when I describe some small part of it. It's like trying to understand an elephant by looking at only some small part of it. Please try starting the novel. If the characters seem insane or do things that seem irrational you should be able to tell right away. If you read the novel it will make sense to you. But if I provide a list of characteristics of the economy / nation with my system, you will simply tell me that I am mistaken. I have tried that route with others.
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Money is not the root of all evil, quite. But money can be taken from you against your will. (Robbery, theft, taxes, fraud.) Money supply is independent of the supply of goods and services for sale. (Inflation and deflation are possible.) Money is amoral. (Money can be used for good and bad objectives. Hitler had to pay the people who operated the death camps.) Money is uncontrollable. (Every nation has organized crime. See Wall Street. :-) ) Money simulates a zero-sum game. (Buyer and seller are cast in the role of opponents because the buyer wants to spend as little money as possible and the seller wants to get as much money as possible.) Money is used to conduct war. Money encourages the exhaustion of natural resources. Money is used for bribes.
Yes, people should be good and moral but look what money allows them to do and what they do to gain more money.
Are you saying that POM cannot?
Buyer and seller are cast in the role of opponents
This simply is not true. I am a marketing and sales director and everything I sell is done under a partnership. I use only reason and integrity to sell, I never coerce anyone to buy my products. Even in my marketing capacity, I tempt them but it is never in an adversarial capacity.
the buyer wants to spend as little money as possible and the seller wants to get as much money as possible.
Again, not true most of the time. People want value, not junk. I could buy a hamburger for $5 but I'll take the fillet for $25 thanks.
Money is used to conduct war
I would argue it is a lack of reason, not money.
Money is used for bribes
So is POM
Yes, people should be good and moral but look what money allows them to do and what they do to gain more money.
There were immoral people long before there was money.
To read your novel Larry would take a lot of time I do not have. I write, I work two jobs, and have two kids. I have to be motivated my friend, very motivated.
Yes, I am saying that non-POM cannot be taken from you against your will.
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How do you set prices for what you sell? If demand goes up do you raise your prices? Would your customers prefer to pay less for your products? If you want to charge more and they want to pay less then your interests and theirs appear to be in conflict. (Of course, you are actually in a mutual interdependence relationship in which you and your customers are helping each other but that isn't how the money makes it seem.)
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Has there ever been a nation that went to war that did not use money in that effort? I don't know of any. In fact, one of the main reasons kings used to borrow money was to go to war.
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POM is the kind of money we use now. It is used for bribes. Non-POM cannot be used for bribes. You can spend it but you can't give it to anyone else. I know you don't understand how that could be true but that's because you don't understand non-POM and naturally assume that POM and non-POM are the same when they are actually fundamentally different.
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You can't shoot anyone if you don't have a gun. POM makes it possible to do all sorts of terrible things. (See world history.) If you make it difficult, awkward, expensive, and very difficult to get help to do bad things, you reduce the rate of bad things being done. Non-POM isn't perfect and it doesn't make people perfect, it just is far better than POM as a money.
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It is your choice whether to take the effort. I would not have it any other way. I hope that one day you do find yourself so motivated.
Thank you very much for your comments, I am starting to look forward to them! You make an excellent point that I will address in a future post, probably next just due to your insightful question. In a nutshell though, supply has a very high propensity to satisfy demand due to the affect of the profit motive. When does that end? When profits are too risky to take of course. The subsequent article will describe this in more detail of course.
WWII did not end the Great Depression, the sufficient end of New Deal policies did it (which is why so many wars have not solved our problems today. Larry is correct here as well).
If we had a free market then supply would follow demand.
Even with the best minds trying to get the economy moving, it's still on life support with ups and downs. What it's going to take is that consumers, who have a lot to do with plowing their squirreled-away stashes of cash will feel like buying again. This will make manufacturers feel like revving up production and that starts the economy back up. Jobs follow.
Who's doing good are makers of planes and defense contractors. Crop harvesting jobs go begging, Americans don't want to hack the heat and back breaking hours, even with offers of $100 a day in Alabama, reported on NPR.
Saving is not the problem. In fact, due to the easy money policies of Bush, very few have saved much. Although it is true that many capital investors are sitting on money, but why should they invest when the likes of Obama who has never had a real job in his life thinks he know what to do with peoples money than they do? This is true with both investors and innovators that drive economic growth and job creation.
Out of your sentence I bolted the main words. Without any criticism of mine, this means that:
1. How is "innovation" created? How long it takes to crreate it and then market it?
2. How long it takes to get the benefits?
3. How is the risk computed? What a capital investor needs to take such risk?
As, IMO (and experience) there is a timing problem among the others, provided we need JOBS NOW,
4. Which is YOUR solution for raising IMMEDIATELY the GDP?
As far as the last question is concerned, please be extensive.
Great questions:
1. Innovation is created in the minds of great people. How long does it takes? Depends upon the innovation.
2. Depends on the innovation. Some months, many years.
3. Risk is calculated by viewing markets and demand for products and services.
We need jobs now, exactly. That is why stimulus needs to STOP NOW and the benefit to risk taking and innovation be maximized as much as possible. In other words, only tax on necessities like national defense and infrastructure and end the handouts - all handouts.
4. Answer above.
Let start by the beginning: Innovations depend on many things. One among the many are the exploitation of rare earths: unfortunately ALL (absolutely all) extracting and purifying patents are in hands of China and Japan. So, as such rare earths are needed in any innovation, either you wait for them to become public, either you try to buy them and this will any way take several years to be completed. Rare earths are needed for manufacturing any kind of computer or electronic item.
Another example is from the paper drawing to the market, a car, a simple updated (otherwise no market could be) takes an average of 7 (seven) years.
And I don't talk about any pharmaceutical new formula which implies more often at the least a decade.
Drilling for oil needs about 5 to 6 years but if you are lucky enough after 2 years of drilling you will be aware if you may find oil or water. Nowadays, using the most updates techniques one finds oil in 1 well out of 3 ...
However, you certainly have noticed that these examples are starting from an already paper project. However innovation means as well long years of education, of training brains and, unfortunately again, available money is not defining the quality of the brains so, if the country needs gray matter, education is to be promoted and you will never train a kid in just a few years. Usually it takes between 20 to 25 years ... if very good and with enough means or loans.
Risk cannot be calculated only on markets because when the projected item reaches it, several years have already pass by and therefore the "innovation" has to match the then market. Steve Jobs was a champion in this matter because he was able to figure out the easier way to use a computer, which can achieve far more than demanded.
But still, you need a lot of common services which, even private, have to be organized. If not, you would not be able to see any image on your TV set or similar: all the waves would trouble the others .
So infrastructures are needed. Would you maintain free of charge the Golden Gate?
As far as question 4 is concerned, I repeat it. "Which is YOUR solution for raising IMMEDIATELY the GDP?"
As per your answer to it: do you sincerely believe that taxing necessities and avoiding filling documents will raise the GDP? Any way this will not provide jobs. As you know corporation taxes are included in the selling price of most of them and no one will accept to pay VAT on warships or aircrafts and documents (handouts) are not paying taxes but imply JOBS.
But there is the begining of a response: you mentioned "infrastructures". Here again you have IMMEDIATE JOBS through their maintenance and NEW ONES. However, you should notice, here, that NEW ones imply several years before coming available to investors and within the RISK are comprised several different types of STATE investments to be achieved. Most of them imply a FEDERAL involvement. But again, they depend on the EXPECTED GDP.
Mainly as, within the RISK, security (all of it) is an important factor, far more important than the taxes.
This why some countries are still enjoying a good position despite the world wide crisis we are in. They provide EDUCATION, EDUCATION, R&D fundings, universal health care, out and inland security, fast communications, etc., all of them with some fees.
So, I repeat my question and please be EXTENSIVE, out of any theory but showing pragmatism: "Which is YOUR solution for raising IMMEDIATELY the GDP?"
Oh really? What rare Earth did Facebook exploit?
“innovation means as well long years of education, of training brains”
Wrong again. Walt Disney never even finished high school.
”years have already pass by and therefore the "innovation" has to match the then market”
Wrong again. You are assuming innovations are some grand idea, they often are not. A landscaper might think of a more efficient way to cut grass, an innovation that would quickly allow him or her to acquire market share and earn greater profits. You have a very narrow and pop-culture knowledge of the subject, Gilbert.
“So infrastructures are needed. Would you maintain free of charge the Golden Gate?” Taxes. Infrastructure is a necessary function of any government.
“ do you sincerely believe that taxing necessities and avoiding filling documents will raise the GDP? Any way this will not provide jobs.
In never said it did. Read my response and actually respond to what I say, not what you wish I said.
So, I repeat my question and please be EXTENSIVE, out of any theory but showing pragmatism: "Which is YOUR solution for raising IMMEDIATELY the GDP?"
I answered the question. I am not repeating it for you.
Several, if you look at the electronics parts necessary for Facebook to function. More interesting than that is what's happened to the Facebook market cap since the IPO.
In the present economic situation where there is no demand for goods and services, where businesses have no incentive to increase production or hire more people because they're profitable and meeting demand, and there is deflation or a very tiny amount of inflation, we need to increase demand. This is the rather narrow situation where massive government spending could work. When the demand for goods and services increases the economy grows. If government spends the money it has the same effect as when anyone else spends the money. WWII is a great example of what happens when government injects huge sums of money into the economy. Like the WWII era, the government presently can borrow at insanely low rates. If it succeeds in stimulating the economy the increased revenue will help it to retire the debt.
There's one more thing we need and that's more of a long term item. We need jobs that pay well enough so people can actually buy stuff beyond the minimum food, clothing and shelter. Innovation doesn't do a darned thing to grow the economy if the majority of the population has no discretionary income.
This is ridiculous Nippy. Of course there is demand, there is simply not a means. There is always demand. People always want more. People always want something better. This is human nature. What you are claiming here is that people all of the sudden are not acting like people anymore, this is just impossible.
People do not have a means because the economy is not growing. Without growth, we become stagnant. When we become stagnant, the ability for people to satisfy their demands is stifled.
Massive government spending has not worked, it never worked, and cannot work. If you read my post you will see why.
If government spends the money it has the same effect as when anyone else spends the money.
Wrong again. When people spend their money, they are spending their money. They are not taking spending power from someone else. the government earns nothing and produces nothing. Therefore, they must take the productive and spending power of someone else. due to the inefficiency of government, the fact it spends money like it is free, and the bureaucracy it must also feed, its spending is counterproductive.
WWII is not a case in point. The Great Depression ended because WWII forced the government end much of the New Deal that was causing the Great Depression.
When one offers an example which is general (most of our manufactured items use nowadays, even in a tiny proportion, rare earths) the response is about the "user" of the item.
When one gives as an example on the usual need of education, the response deals with an exception (Walt Disney) who has been paid for his drawings since he was 6 (six), went to Chicago High School and mainly completed his studies at Chicago Art Institute being immediately after official cartoonist for a paper.
As if any one out of 320 millions inhabitants could have such drawing (or any other type) skills.
When talking about the DEMAND, I am responded that demand still exist but that money is not existing for it. And this is simultaneously right and wrong: much of the past consumption has been achieved on credit basis and therefore, much of the actual income (IF ANY) is subject top high interest rates to be paid out. However, I notice, that this is an indirect charge of too low wages!
Yes, the demand is shrinking within a fast evolving market: if someone wants a new artifact, he/she knows it will be outdated in less than 18 months to come.
At this level, the usual people, the 47% one, before spending any money which may be needed for eating next month or two, when oil may become so expensive that it implies to try to find collective means to reach the job area, such type of expenses may be postponed up to the next competitor advertisement.
So the response takes into account the "desire" for any new item but not the "ability to choose" that exceeds the spending desire. If there is insecurity in the sustainability of the money to come, if it is based on a backlog of so-called "elastic" capacity to fulfill its task, etc., there necessarily constitution of savings when possible. That savings, if any, cannot reach consumption.
As far as the New Deal of FDR, I notice that it remained in force, mostly intact, even under Nixon, practically for 40 years and the "degrading" of economy started really after 1975 when, with Congress agreement of BOTH parties, lack of economics discipline started with the deregulation of the markets, in other words when, on the excuse of "freedom", a fake free market has been instated.
"Fake" because of the created monopolies and of the somehow interferences of new laws often aimed to control some environment, security, etc. but leaving huge spaces for financial swindles and speculations; as gambling against the Dollar (an example among many others). This why, BTW, devaluations (as in 1936) are not working any more.
On top of it, such "free markets" have been topped by worldwide trade agreements and, last but not least, a continuity in R&D budgets shrink since 1975. Less education, less Federal investments in always more sharp and expensive tools, have exported gray matter, outsourced manufactures, helping to shrink the GDP.
In the meantime thanks to falling directly productive investments (factories, etc.) the financial investments (with their speculations) took over: subprime, LIBOR, etc.. They have contributed greatly to the establishment of unemployment "blue-collars" accused of being too expensive relative to foreign labor. It is impossible to convert the blue-collar to white-collar workers without education, in addition, the technology tends to reduce the number of white-collar employees.
The increase in GDP goes thus, necessarily, by the use of blue-collar pending transfer capacity through education, which can be done in several years closer to the decade than to the unit. We must, absolutely, reduce the gap between performers and capitalists.
I'm afraid that such a track scares John who is, obviously, unable to answer the question, because the answer would be in contradiction with his own philosophy.
He wants to believe that taxes are the main reason to set or not a factory or any type of manufacture, disregarding all other vectors to the exception of the granted authorizations which, mainly, take into account the pollution and, whenever possible, the patents attached to process.
In the meantime, he believes that any settlement is immediately productive if it responds to a market demand.
It is very like discussing with someone practicing blindly a religion when one is , per example, atheist: the discussion itself, raises the fear to lose a pillar of himself. This why he can't be accurate in responding.
But it was fun to compare dreams to reality.
Most probably you hardly have heard about "rare earths" alike Europium, Tersium, Samarium, Cerium, Gaddlinium, Lutecium, etc. which are the "oil of the XXI century" industries: without them 25% of the Japanese industries would close - this helps you to figure out the magnitude of the present "disagreement" with China.
All of these metals are found in our computers, telephones, weapons, bank notes, displays, any electric engine, starters, hard disk readers, CDs, etc., etc. and are used in order to create VERY powerful micro-magnets.
A little bit of history which will help you to get what went on with the American industry:
Most probably you heard about the "Chinagate" trial. Any way, in the North of California, 1980, a corporation, Molycorp, was specialized in mining rare earths but the main extracting patents
were pertaining, mainly, to an American corp. Magnequench which has been bought with all its patents, by China in the late 1990s.
China learned during about 7 years the all needed know-how and closed the plant in 2003 despite the request of many agencies, mainly the military one. The plant closed on behalf of free trade and on behalf of lower wages.
Such close sent to joblessness list not only the workers of the plant itself but, as well outsourced millions of workers in many hardware industries.
With the plant, all the related patents left America, as legally bought by the Chinese. If one can find rare earths every where, the extraction is quite polluting and the main mines are in an area located at some 70 miles from a Chinese city: Bao Tu.
Having the mines together with the practically sole needed patents, China became and is still the sole country supplying these rare earths, which are being marketed mainly to Chinese industries at a price 8 times inferior to any other countries, this is in pure violation to trade agreements. But China enjoys a total monopoly on the whole system including its industrialization.
If you add to this, the cost of the labor, you understand easily how come some pieces, even relative to our most secret items as military missiles, DEPEND on Chinese supplies.
So when you talk about "innovations", disregarding one of their main components, you are just talking through your hat.