A summary of trickle down economic theory:

[Kidlicious]

Originally posted by MichaeltheGreat


Off towards Yosemite / Tioga / Mono Lake?

Just got back from Wishon. It's south of Yosemite.

[Kidlicious]

Originally posted by Kropotkin
This is in fact an interesting problem that's hard to solve with a orthodox view on things. I spent some time talking to my professor about this (one of his areas of expertice is service production), to be more precise; the contribution of white-collar workers in industrial goods production. With the logic that organizing isn't work then a hell of a lot of employed people are not working.

One could be very conventional about this and say that their contribution is reflected by their salaries relative share of the costs of inputs but that's quite lame. I'm more into considering the costs of organization and thus also white-collar workers, as the costs of transactions and/or coordination in the tradition of Ronald Coase.

Organizing has to be done, and people should be paid for it since it takes time to do. I just don't think some rich guy should be able to live like a king just because he makes a profitable investment.

[Kidlicious]

Originally posted by The diplomat
Third, and here comes the trickle down economics lesson, the corporation that gets a 20 million dollars capital gains tax cut is going to stimulate the economy a whole lot more than the guy on miminum wage that gets a 100$ refund check. How many jobs can the guy on miminum wage create with a 100$? This is not to say that the guy on minimum wage should not get anything. But if you want to stimulate the economy, you have to put the money where the jobs are. After all, it takes money to make money!

Someone has to buy the goods and services. How is giving it all to corporations going to stimulate the economy? They aren't going to produce anymore if there isn't anymore demand. If they do produce mroe they will just lose money.

[Kidlicious]

Is the competition thing a thread jack. Does that have anything to do with the topic?

[chequita guevara]

Originally posted by Kidicious
I know what supply and demand is, but wanting things is not the same as producing things. Value only comes from labor. We just have to produce things that we want. That's all.

Marx wrote that nature is equally a source of value. Value itself is socially created. Labor can produce a useless and unwanted thing. Just because it comes from nature and was worked on by labor does not necessarily impart value to the thing. This is also why the same objects that are made with more labor than an efficient worker, despite having more labor put into them, are not more valuable than commodities created by a quick and efficient worker.

This leads to the concept of socially-necessary labor. Whether or not a thing as has socially necessary labor value will be determined by the market. If no one wants it . . .

[Solly]

"Value only comes from labor"

Not this crap again. Shall I go and dig a hole in my garden and fill it in again?

Will I get paid?

[Kidlicious]

Originally posted by chegitz guevara
Marx wrote that nature is equally a source of value.

How can raw materials have any value. Labor is required to give them any value. They have no value without it.

Originally posted by chegitz guevara
Value itself is socially created. Labor can produce a useless and unwanted thing. Just because it comes from nature and was worked on by labor does not necessarily impart value to the thing.

Sure there are errors made and there are surpluses and shortages of goods and services. When there are that just lowers the productivity of the overall system. The value of the total goods and services produced is still determined by the labor involved and minus the surpluses.

Originally posted by chegitz guevara
This is also why the same objects that are made with more labor than an efficient worker, despite having more labor put into them, are not more valuable than commodities created by a quick and efficient worker.

Yes, productivity is important, but you will have to make the connection for me here. Where does the value of things that are not produced efficiently come from?

Originally posted by chegitz guevara
This leads to the concept of socially-necessary labor. Whether or not a thing as has socially necessary labor value will be determined by the market. If no one wants it . . .

Why are the workers responsible for the errors in the system? This is the fault of the system and the organizers.

[Solly]

[The Templar]

Originally posted by obiwan18


That's why we need to cut taxes for the rich so that they can start new businesses and raise employment.

I've got a better idea Trickle Up Economics:

We eliminate income and payroll taxes on all income less than $200K, and eliminate sales taxes. We jack up corporate taxes and taxes on income over $200K to cover the shortfall.

With the extra money most people will have in their pockets, they will buy more goods and services. Increased volumes will allow the corporations to grow out of the increased tax burden. That is, people will have more money, thus they will spend more money, this will necessitate more jobs. The rising tide will lift all boats. In fact, as this tide continues to rise, more revenue will be generated, allowing more middle and lower class entitlements. And the rich will still make more money. Thus, everyone will be happy, right?

After all, most people make less than $200K and the marginal utility of not taxing income over $200K to the economy is far less than allowing the average people to spend more of their money in the marketplace. For example, everyone eating out more often will help the restaurant business more than rich people eating out more because the former will result in a greater increase in volume of meals ordered. My plan is better in that it will encourage more people to eat out more often from all classes.

Trickle Up! That helps everyone.

[Solly]

Income elasticities of demand are a funny one Templar..

[The Templar]

Originally posted by Boddington's
"Value only comes from labor"

Not this crap again. Shall I go and dig a hole in my garden and fill it in again?

Will I get paid?

Ah, you got a "D" in logic didn't you? "Value only comes from labor" implies that there is no value without labor. It does NOT imply that all labor amounts to value.

Even Locke's labor theory of property (and he was hardly a communist) argues that value is only to be found in labor when you get down to it.

[Solly]

I think we need a Stenish versus Kidiciousish thread. That would be fun to watch.

[The Templar]

Originally posted by Boddington's
Income elasticities of demand are a funny one Templar..

Not really. Americans spend money. The more they have, the more they spend. Reduce the tax burden on the average consumer and the average consumer will consume more. Its fairly simple, and at least as reasonable an assumption as the one that underlies trickle down economics - i.e. greater wealth at the top will actually trickle down. Actually, my assumption is more sound people at the top have incentives other than allowing their windfall to trickle down. Consumers will spend the extra money they have. The only thing that could defeat my assumption is if Americans decided to save more money. Yeah, right! I got a bridge to sell you if you believe that.

[Kidlicious]

People keep assuming that trickle down economics is going to work, and it keeps failing. The least we should do is try the opposite one time.

[Solly]

Why would the opposite work, and trickle down not?

Please explain without reference to labour.