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Post by lc on Feb 16, 2006 21:42:00 GMT -6
The thread is intended to be a theorists discussion of economic models. The reason I started it is because very few economic models have been attempted, out of an infinite possibility. And probably none of the attempts at economic forms have been examples of "pure" forms. And economic forms have never been adopted as matters of principal. They have evolved according to struggles for wealth between classes, nations, corporations and individuals. Centuries long campaigns to shape economic parameters to serve the advantage of one's self and one's peers has created all the economic opportunities that the world has ever known. In it's purest sense economics merely serves to distribute goods and services for the benefit of it's participants. So we have adopted a form of economic theocracy called capitalism. Why? Has it worked? What were the alternatives? Capitalism has been defined in various ways.[1] In common usage, it means an economic or socio-economic system in which the means of production are overwhelmingly privately owned and operated for profit, decisions regarding investment of capital are made privately, and where production, distribution, and the prices of goods, services, and labor are affected by the forces of supply and demand.
While most people[citation needed] regard the Western developed countries as capitalist[2], some of these economies may be more strictly called "mixed economies"[3], because they contain state-owned means of production and significant government economic interventionism.Wiki Capitalism: en.wikipedia.org/wiki/CapitalismThe first use of the word Kapitalist was in 1848 in the Communist Manifesto by Marx and Engels; however, "Kapitalismus," the german word for "capitalism" was not used. The first use of the word capitalism is by novelist Thackeray in 1854, by which he meant ownership of a large amount of capital, not a system of production.
In 1867 Proudhon used the term capitalist to refer to owners of capital, and Marx and Engels refer to the "capitalist form of production" ("kapitalistische Produktionsform") and in Das Kapital to "Kapitalist", "capitalist" (meaning a private owner of capital). None of them, however, used "Capitalism" in our current meaning. The first person to do so in an impactful way was Werner Sombart in his Modern Capitalism in 1902. Max Weber, a close friend and colleage of Sombart's, used the term in his The Protestant Ethic and the Spirit of Capitalism in 1904.~~~~~~~~~~ Some emphasize the private ownership of capital as being the essence of capitalism, or emphasize the importance of a free market as a mechanism for the movement and accumulation of capital. Others measure capitalism through class analysis, including the class structure of society and relations between labor and the capitalist class. Some note the growth of a global market system.
In describing capitalism, Hayek, points to the self-organizing character of economies which are not centrally-planned by government. Many, such as Adam Smith, point to what is believed to be the value of individuals pursuing their self-interest as opposed to altruistically working to serve the "common good." Karl Polanyi, a seminal figure in the field of economic anthropology, argued that at the time Smith was primarily describing a period of organization of production along commercial lines. For Polanyi, capitalism is distinguishable from earlier mercantilist and commercial eras by the commodification of land, labour-power,and money. It appeared in mature form as a result of the problems raised when an industrial factory system requiring long-term investment and entailing corresponding risks was introduced into an internationalized commercial framework. Historically speaking, the most pressing needs of this new system were an assured supply of the elements of industry- land, elaborate machinery, and labour, and these imperatives led to the afforementioned commodification; not through a process of self-organizing activity, but rather as a result of deliberate, often forceful, state intervention. (see Karl Polanyi, The Great Transformation)
Many of these theories call attention to various economic practices that became institutionalized in Europe between the 16th and 19th centuries, especially involving the right of individuals and groups of individuals acting as "legal persons" (or corporations) to buy and sell capital goods, as well as land, labor, and money (see finance and credit), in a free market (see trade), and relying on the state for the enforcement of private property rights rather than on a system of feudal protection and obligations.
Due to the vagueness of the term, debates and controversies have emerged. In particular, there is contention on whether capitalism is an actual system, or an ideal, i.e. on whether it has actually been implemented in particular economies, or if not, then to what degree capitalism exists in them (see mixed economy). From a historic point of view, there is an argument on whether capitalism is specific to a particular era or geographic region or if it is a universally valid system that may exist throughout various times and spaces. Some interpret capitalism as a purely economic system; others however contend that capitalism is a complex of political, social, and cultural institutions.
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Post by lc on Feb 16, 2006 21:46:40 GMT -6
So beginning the discussion....
Commodification of land, labor, and resources. That one act in itself has changed the world.
The acceptance of corporations to have inherent rights similar to or equal to persons, another giagantic advent in the direction of human evolution.
Do any of these assumptions serve us? Obviously they do to limited degrees and for some of us much more than others or as a whole, but the only real question IMHO is whether they serve us as a whole. Are we better off accepting the commodification of land, labor and resources, and the acceptance of corporations as entities deserving of rights akin to actual persons?
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Post by unlawflcombatnt on Feb 18, 2006 14:03:52 GMT -6
I don't have any great suggestions as to a better system than capitalism. A noted historical figure (whose name escapes me) stated that capitalism was a terrible economic system, but it was better than any others. I have to agree with that statement.
Any successful economic system needs to reward those who produce successfully and efficiently. At the same time, those rewards cannot be so excessive as to destroy the system in the long run. If those rewards are excessive, it will cause the accumulation of capital in excess of that which can be utilized. Such an excessive accumulation will lead either to production in excess of consumption, or to "leakage" of this capital out of the economy. If this leakage results in increased savings, when capital is already excessive, this "savings" cannot be reinvested in any productive endeavor.
Thus, any system needs to maintain balance between the accumulation of capital and the ability to use that capital. To put a slightly different twist on this, there must be balance between the "means of production" (including capital) and the "means of consumption." Furthermore, the "means of consumption" cannot be indefinitely maintained by borrowed money. If consumption financed by borrowed money is not eventually replaced by wage-financed consumption, the system will collapse. Eventually borrowed-money financed consumption will reach a limit. When it does, consumption will fall, demand for production will fall, and capital will be in even further excess of that which can be productively invested.
My recommendation for an economic system is still capitalism. But the government needs to implement fiscal and monetary policies toward maintaining the balance between the "means of production" and the "means of consumption."
The lack of such a balance could lead to another Great Depression. During much of the Great Depression, the "means of production" were ample. There was abundant labor and abundant capital equipment. Unemployed workers actually sat idle outside fully equipped factories. But there was no demand for their labor, nor demand for utilization of existing industrial capacity. There was insufficient purchase of production to employ our workforce and our production facilities. There was insufficient demand for production.
This was the result of numerous factors. Ultimately, the major factor became the over-abundance of capacity & investment capital in relation to production demand. Consumer ability to purchase the production of that capacity was less than the capacity to produce. Much less.
Government pump-priming, through pre-WWII and WWII spending, ultimately provided the demand necessary to revive the economy. I wouldn't label the Depression as a failure of capitalism. I would label it a failure due to its excesses. Many believe these excesses were actually caused by government policy, not to the lack thereof.
Once the economy collapsed, it was a perfectly justified time for the government to step in. The underutilization of productive capacity resulted in greatly reduced wealth production. This made everyone less wealthy, rich and poor alike. Government intervention was justifiable at the time to prevent capitalism's earlier excesses from destroying it.
The Right frequently regurgitates the "onerous regulatory burden" mantra, claiming government intervention stifles production. Truly excessive regulations do reduce production and wealth creation. We definitely don't want excessive government regulations to "kill the goose that laid the golden egg." However, we do need to have enough regulations to prevent the "goose" from killing itself. This latter is our biggest problem today. That's what Keynes tried to prevent in his time. We need to prevent the same thing from happening today.
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Post by lc on Feb 18, 2006 22:03:21 GMT -6
UnLawful, My biggest complaint about Capitalism is that it was developed for the express purpose of expanding the abilities of an upper class to increase their wealth. Capitalism is not, as it often claims, an organization of capital positively influencing organization, productivity and distribution of goods and services for the sake of the general good. That is a purely abstract vision of what is actually happening.
Capitalism demands a multi tier caste system. It was created by the aristocracy of a two tier caste system to codify the structures of classism into law and industry.
Capitalism requires a class with capital to be the investors in industry. It also requires a class who work for wages to support the investments of the capital class with their labors(productivity).
As much as anything, capitalism's core design is about commodifying the labor of the lower class for the benefit of the upper class, and codifying barriers that limit the ability of the labor class to rise to the top of the structure.
If capital was not a function of a wealthy class/caste, and was not based on a direct competition between the success of the labor class vs the owning class it would probably be a fine system. But it was created for the purpose of reinforcing a class divide, eveolved with that purpose at it's core, and has mutated for the same reasons. The corporatacracy that you refer to frequently is just a more advanced degree of the same classist design of capitalism.
And the reason why pension funds are unworkable is that it is mathematically impossible for more than a small % of the population to support themselves in a fine fashion by being the beneficiaries of "capital driven" incomes. Only a certain % of any population can earn a generous income by capitalizing the industries of the world. Maybe that % is 2%, maybe it is 10%, but it sure isn't 50%.
And the arrangements are inherently unfair no matter what the % is. Andrew Carnegie did not earn his fortune. He managed to accumulate his fortune via a long list of component factors, some of his doing, most not but the largest factor by far was the income he earned directly at the expense of paying his workers less than he earned from their productivity.
And without ways to redistribute generational wealth capital accumulations amount to a pedigree of relative royalty, and relative serfs and relative slaves.
If capital was the commonwealth of a population, as it should be, productivity could still be generated easily enough via any number of incentives. Salary or compensation for productivity would be a fine one. But ascension to a permanent class of non producing capitalists is unwarranted.
I just have to consider the $17 million annual salary of US corporate CEO's to realize that classist capitalism is serving just a very few, while the nations economy is being raided for the good of those same few. And most of us who contributed with taxes, labor and our life blood will be empty handed when the bill is finally delivered.
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Post by lc on Feb 19, 2006 21:52:30 GMT -6
OK, lets try some mental experiments:
Capitalism rests on a collection of largely unchallenged assumptions. One of those ideas is the one mentioned in the previous post, that capitalism requires a wealthy class, a labor class and recently a consuming or middle class.
What if no wealthy class was required for capitalism to work. What if capital was the exclusive property of other types of organizations other than generational oligarchs and governments?
What kind of groups? The possibilities are endless. For a small start how about community and regional credit unions, farmer co-ops, industrial unions, political lobbies, non profit orgs, self insurance co-operatives, worker collectives, pension funds.
I had an epiphany years ago and conceived the idea that local credit unions could merge with public self insurance and provide a full compliment of financial services to members that would be able to provide for every financial need that a community could require. The model was not original, as i farmed the idea around I discovered that that is exactly how the original insurance companies were born. Mutual of Omaha was a farmers insurance collective as one example.
Suppose a dual credit union/self insurance co-op existed with open membership in YourTown, USA? They could offer you discount insurance (home, auto, life and health), banking services, investment services, finance your home mortgage and any other financial service typically in demand within your community. So as a local investment hub, they would be the nexis of a lot of capital. They would have the combined tho measured financial strength of your former bank, insurance providers, investment broker. And they would be challenged to invest those holdings, but how? How about into local community development? Local industry, local infrastructure, local political lobbying, local charity work. And all of those investments and services would generate income that would add to the shareholdings of the members.
It is a win/win/win solution. And it could be adopted by labor unions, business associations, cities, counties, states, Fraternal organizations, political parties, non profit groups, etc.
Any member of a given community could be a member of several such coops at once depending on his own circumstances.
This concept circumvents the banks, insurance companies, hmo's and investment brokers and shares the wealth with the general population. And the financial services co-ops could issue stocks to members to reimburse their earnings, and those stocks would represent real shares of the wealth of the co op, but would not extract capital from the co op. The stocks could be sold, as they pay dividends and represent real wealth, but they subtract nothing from the equity of the group.
What if Lansing Michigan had such a co op and decided to enter the early auto industry in 1907? Who is to say that a local co op could not have ended up being General motors by virtue of local co op investment in a co operative business venture, democratically pursued?
Comments?
Is there really any need for capitalism to cater to the "needs" of generational oligarchs who subtract equity from the public arena as they earn it?
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Post by unlawflcombatnt on Feb 20, 2006 16:22:17 GMT -6
UnLawful, My biggest complaint about Capitalism is that it was developed for the express purpose of expanding the abilities of an upper class to increase their wealth. Capitalism is not, as it often claims, an organization of capital positively influencing organization, productivity and distribution of goods and services for the sake of the general good. That is a purely abstract vision of what is actually happening.... Capitalism requires a class with capital to be the investors in industry. It also requires a class who work for wages to support the investments of the capital class with their labors(productivity). LC, I can't disagree with anything you've said here. Capitalism certainly was set up to benefit the most affluent. However, its implementation has been modified considerably since its beginning. Many of those modifications have made it a more productive system, as well as a more equitable system. Unfortunately, it has started drifting back into a less productive and less equitable system. It's my contention that "equity" and "productiveness" are highly dependent on each other. Capitalism requires not only capital and labor, it requires consumers who can purchase the goods produced. As it becomes less equitable, it also becomes less productive. Production will not occur without consumer ability to purchase that production. And that ability is completely dependent on spendable consumer wealth. As we both probably agree, consumers' "spendable wealth" has been greatly expanded through credit. As a result, the problems created by the increased inequities have been obscured. Consumption has not fallen in line with the fall in consumer income. The result is that current "supply-side-ish" policies appear less damaging than they actually are. Debt-financed consumer spending has obscured the true imbalance between the "means of production" and the "means of consumption." Current economic policies appear less disastrous because increased debt-financed spending has filled the gap left by decreased income-financed spending. Adding insult to injury, much of the excess capital resulting from this imbalance "leaks" out of the economy into non-productive endeavors. This is money that could have helped our economy, had it gone to where it was actually needed. In a neo-Keynesian model, increased "savings" does no good whatsoever for the economy unless it can be re-invested. Though it is always assumed that savings will be re-invested, it's not always a correct assumption. Money can sit in accounts and not be utilized. Though Right-Wing Corporatists vehemently dispute this, simple common sense refutes such arguments. Right-wingers will argue that increasing the quantity of investment capital increases total investment. This certainly is not true if the increase is at the expense of consumer spending power. It's consumer spending that creates investment opportunities. With decreased investment opportunities, regardless of increases in investment capital, there will still be a decrease in capital investment. Capital will not be invested without anticipated returns, regardless of how much capital is available. Owners will protect this excess capital, even to the point of banking it or putting it in offshore accounts. The excessiveness of current capital accumulation is evidenced by record levels of Corporate cash-on-hand accounts, and such statements as "the markets are glutted with capital" by the Wall Street Journal. Some libertarian sites espouse the "preservation of capital." They'd be better advised to espouse the "preservation of capital investment opportunities," as well as the "preservation" of consumer demand. I completely agree that the hereditary accumulation of wealth is a bad thing. Though it may be defended on "fairness" grounds, there is no valid defense from an economic standpoint. It's definitely better for those who have accumulated wealth to have earned it themselves, as opposed to inheriting it. If for no other reason, those that have earned the money usually have a better idea how to invest it. Poor investment by bad investors does no one any good. And it leads to investment imbalances and excess influence by the unwise. I definitely favor large inheritance taxes. Is it fair to take the money that the rich have earned and bequeathed to their children? Maybe, maybe not. Is it fair that someone is born with considerable wealth by chance, through no efforts of their own? No, it is not. This "fairness" issue is certainly a subjective one. But the economic issue is not. No one benefits from the accumulation of wealth in the hands of the few. Especially if those few don't put it to good use. Those "few" have reaped the rewards of their parents' success. This success was dependent on a stable government, stable banking system, business-protective legislation, and even corporate hand-outs. Such wealth is just as much a product of American consumers and American government, as it is of their parents' successful business endeavors. Is it wrong to expect them to pay back some of this in taxes to support the very system that made that wealth possible?
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Post by lc on Feb 23, 2006 21:16:14 GMT -6
Money can sit in accounts and not be utilized. Though Right-Wing Corporatists vehemently dispute this, simple common sense refutes such arguments.
Addressing this item first. Money actually can't sit in bank accounts, I hope I understood you correctly, and not be utilized. If I have one dollar sitting in my bank account, the bank, by law can invest 99 cents of that dollar into something that may or may not be productive. Or my bank can lend 99 dollars to a client like a mortgage holder.
Money in a bank account doesn't sit there. But in reality, there is no guarantee that any use of money is gonna be productive.
But from a broader perspective: who cares. There are two opposing points of view at the core of economics. The first is that money serves money (investments seek returns on investment) the second is that money serves people (an income of some parity is accomplished and a necessary flow of goods and services are equally distributed so as to provide for the needs of all people).
Our economic system was definitely designed by those who sought an advantage via having the capital and being afforded an opportunity to expand that advantage for further gain. The very design of the system is counterproductive from the good of people at large, and it has been that way since the coin was invented.
That said, to have this conversation we have to step out of the box of our preconceived ideas about economics and decidedly not subscribe to our typical conventions.
If we advocate our typical conventions and prejudices that were developed in response to an existing economic paradigm, then a real discussion of the alternatives can not succeed.
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Post by unlawflcombatnt on Feb 24, 2006 14:00:37 GMT -6
Loosecannon,
My lack of bank expertise got the best of me here. I shouldn't have referred directly to "savings" in banks. I should have said that Keynesian "savings" does not necessarily go into capital investment. If money loaned is put into bonds or stocks it isn't necessarily "invested" in capital equipment purchases. The capital that results from bond or stock investment isn't necessarily put to something that increases or improves productive capacity or services. I think I'm restating what you said regarding "there is no guarantee that any use of money is going to be productive."
I continue to stress this point because many financial "experts" insinuate that increasing available capital automatically increases capital investment and productive output. It does not. Capital is only invested went there is an anticipated return on such investment, which requires the profitable sale of the products or services provided by that investment.
Consumer spending is the foundation of those returns, and as such, spendable consumer wealth puts the absolute limit on those returns. Increasing the fraction of national income that goes into profits increases the availability of investment capital. But it also reduces spendable consumer wealth. If the available capital is in excess of the consumer wealth necessary to purchase the goods produced by that capital, that capital cannot be invested (productively.) If such an imbalance exists (and it does), more capital investment would actually take place if there was less capital, because there would be more spendable consumer wealth to provide returns. Thus, taking some of the excess capital away from investors would actually increase returns. Again, there's no return on investment if no purchase of products or services takes place.
I agree with Bernanke's earlier statement that there is a "global savings glut." To me this means money has left the world economy and is not going into either consumption or capital goods purchase/investment. Things would be better if this savings "leakage" was reduced. Given that such "savings" is supposed to equal investment, then this savings needs to be reduced until it equals investment. As such, savings needs to reenter the world economy through means other than capital investment, either through consumer spending or government spending.
Excess capital will lead to its own destruction, as it won't be used to increase production unless consumers can purchase that production. It's only use then becomes non-productive, such as overvaluing the stock market or real estate markets. When these markets crash, this excess capital is destroyed. This is unfortunate, as much of that capital could have been preserved, had a little more gone into consumer spending to fund returns, on a somewhat smaller quantity of available capital.
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Post by lc on Feb 24, 2006 14:48:00 GMT -6
I shouldn't have referred directly to "savings" in banks. I should have said that Keynesian "savings" does not necessarily go into capital investment. If money loaned is put into bonds or stocks it isn't necessarily "invested" in capital equipment purchases.
Unlawful, I picked this quote to respond to because it seemed to most accurately summarize your post. I agree with it and all of the statements in your post.
But once again I stress the point that the entire scheme of capitalism as a finacial paradigm was engineered specifically to remove "capital" from the productive sphere and accumulate it in perpetuity in the hands of those who hoard and don't spend.
And I might have mentioned this before but a classic example of this is the stock market. Once an initial offering is sold, the balance of all the money spent buying and selling a share of stock is removed from the productive sphere. The net result is the exact opposite of it's often touted effect which is to serve as the fuel for economic productivity. The same is true for bonds and most investment vehicles.
And it is working that way by design. Indeed an invisible hand has arranged that capitalism would serve as a means of extracting capital forever from the productive sphere, for the benefit of a minority.
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Post by unlawflcombatnt on Mar 1, 2007 3:38:46 GMT -6
I shouldn't have referred directly to "savings" in banks. I should have said that Keynesian "savings" does not necessarily go into capital investment. If money loaned is put into bonds or stocks it isn't necessarily "invested" in capital equipment purchases.Unlawful, I picked this quote to respond to because it seemed to most accurately summarize your post. I agree with it and all of the statements in your post. But once again I stress the point that the entire scheme of capitalism as a financial paradigm was engineered specifically to remove "capital" from the productive sphere and accumulate it in perpetuity in the hands of those who hoard and don't spend. I don't think the entire scheme of capitalism was specifically designed to remove capital from the productive sphere. However, regardless of intent, that does seem to be occurring today. Income-financed consumer spending dollars are being re-channeled into capital through wage reductions, despite the fact capital is already in excess of investment opportunities. In fact, this is one factor driving bond prices up (and returns down), since investment in bonds provides better investment returns than many avenues of true capital investment.
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rdf
Contributor
Posts: 27
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Post by rdf on Mar 1, 2007 19:14:24 GMT -6
Capitalism has gotten to be an overused word with a lot of baggage. Some people confuse it with democracy for example.
I would like to discuss things from a slightly different angle. What makes for innovation in society is entrepreneurship. This is the ability of someone to start an enterprise without government approval (except for the usual health, safety and similar regulations). Centrally planned societies turn out not to be very innovative. The USSR was a good example of such a failure.
China is an example where economic growth started only after the central government stopped controlling the creation of new enterprises.
In general to be free to be an entrepreneur works best in a society which permits personal freedoms as well. Usually this is associated with a democratic form of government, but China seems to indicate this need not be the case.
There are areas of society which are better done (or at least administered) by a central authority. These include large civil engineering projects (roads, dams, etc), military/police functions and various social services.
The defect with capitalism is its tendency toward monopoly or shared monopoly. This leads to economic distortion, inefficiency and suppresses innovation. The telecom industry only blossomed after AT&T was dissolved.
Society is based upon three legs, government, workers and owners. If one sector gets too strong then bad things happen. It is possible to have private ownership of firms without mistreating workers. It is just up to government to set the rules as to what the limits on private firms are or what their obligations are. In the EU firms are required to take into consideration things besides maximizing earnings. This includes worker's right and increasingly ecological issues as well.
Currently in the US the labor leg is too weak and we see the distortions that result from this.
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Post by unlawflcombatnt on Mar 5, 2007 3:14:39 GMT -6
The defect with capitalism is its tendency toward monopoly or shared monopoly. This leads to economic distortion, inefficiency and suppresses innovation. The telecom industry only blossomed after AT&T was dissolved. I completely agree. Monopolies and oligopolies eliminate free market activities and competition that are the true benefits of capitalism. Society is based upon three legs, government, workers and owners. If one sector gets too strong then bad things happen. It is possible to have private ownership of firms without mistreating workers. It is just up to government to set the rules as to what the limits on private firms are or what their obligations are. I agree. I think there is a conceptually simple way to explain this. There needs to be a balance between the "means of production" and the "means of consumption." And I would add that the means of consumption can not be maintained through increased borrowing ability alone. In the long-run, consumers need to be able to purchase production from their earnings. Without the production demand so created, production will not continue. If consumer income is sacrificed to create more capital (via high-end tax cuts), it reduces consumer ability to purchase production. Giving investors more capital to increase production (and hire more workers) has no benefits if consumers can't purchase that production. Purchase of production is limited to what consumers have to spend. Reducing all workers' share of firms' income, in order to increase profits (and investment capital), is of no benefit if it deprives worker-consumers of the ability to purchase production. This imbalance can easily be obscured by increased borrowing ability. However, this borrowing ability increase cannot indefinitely substitute for lack of wage increases. Eventually the borrowed-money component of consumer spending will falter, and the economy will follow. This is exactly the direction we're going in at present. Workers' wages are being kept down, but spending has continued to rise due to massive increases in credit and credit-financed spending. You're right on target about the labor market being weak. This reduces demand for workers, and reduces employment and average (and aggregate) wages as well. This is the result of decreased unionization, outsourcing of jobs (decreasing labor demand), and increasing legal and illegal immigration (increasing labor supply in the face of declining labor demand.) All these factors make the labor market weak and suppress wages. And this wage suppression limits wage-financed consumer spending, which in turn reduces production demand, which in turn reduces the demand for labor to provide that production.
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Post by jeffolie on Mar 5, 2007 15:15:12 GMT -6
The gobal wage arbitrage is a bitch. Whenever the US bumps up against wage push pressure, then a new sector of the labor market goes overseas. Now it is the professionals that are watching their jobs such a medicine, engineering and of course computer sciences going to Asia. I read alot about the tremendous growth in medical tourism where Americans go to Asia to get major operations.
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Post by unlawflcombatnt on Mar 5, 2007 22:15:33 GMT -6
Few jobs are immune to outsourcing. The trend is moving up the income ladder. And where outsourcing can't be done, foreign professionals and skilled workers are imported through H1B visas and other means, helping to drive down wages of American professionals.
It's interesting how the government has bent the law to accommodate the outsourcing of professional jobs, like radiologists. Now a radiologist in India can read an X-ray on a patient in California. Normally a physician must have a license in the state he's practicing in, including radiologists. It's hard for a radiologist in India reading an X-ray on a patient in California to also have a medical license in California. Corporate Medicine has to find some way to circumvent state licensing laws in order to have foreign doctors read X-rays on American patients.
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