3 ms·

> First of all, business is about providing value to customers, not jobs to neighborhoods. ... We don't want a thousand people making a iron boiler for a steam

by dctoedt 16y ago

> First of all, business is about providing value to customers, not jobs to neighborhoods. ... We don't want a thousand people making a iron boiler for a steam engine anymore. The value-to-customers part is the truth, but not the whole truth. If a government's economic policies don't result in jobs being provided to neighborhoods, then three things are inexorably going to happen: 1. A non-trivial number of (usually) young men with too much time on their hands will do things that we really wish they wouldn't but that we have a very hard time suppressing, especially when they can use communications technology to their benefit: Street gangs. Drug cartels. Jihadist groups. 2. People will blame their governments because they perceive that Bad Things -- unemployment, drugs, crime, terror -- aren't being fixed; 3. Disruption will result, because people won't passively accept Bad Things indefinitely: (a) In a democratic society, the government will be thrown out and policies will be changed -- possibly not for the better -- and with switching costs in any case; (b) Even in a non-democratic society, there will eventually be unrest as people get mad as hell and refuse to take it any more (cf. the Honda strike in China, but then there's North Korea as an apparent counterexample); I'm a life-long moderate Republican, but it's only been in recent years that I've come to appreciate that, unlike some conservatives, liberals 'get' these fundamental truths of human nature. I wish these truths were otherwise, but to paraphrase Lazarus Long, you don't argue with the weather, you deal with it. (That's one reason I'm encouraged by the favorable reports I've been reading about the educational policies that the Obama Administration is pushing.) ISTM that some liberals have unrealistic views of how we should deal with these truths -- some of them likely would be happy having a thousand people making a boiler -- but that's another debate.

jbooth 16y ago
Not to mention that even without risks of total upheaval, if nobody but the top 1% has any money, who are you going to sell goods to?
SkyMarshal 16y ago
Upvoted for non-dogmatic thoughtfulness. Apologies if that sounds politically bigoted, but so much of what I hear coming the GoP these days is devoid of that quality. I hope you run for office some day. I think this issue is only part of a larger group of related problems that seemed to start metastasizing 30 years ago. In a nutshell: scientific management -> manufacturing process and profit margin optimization -> manufacturing outsourcing to low-cost countries -> decreased product costs + planned obsolescence -> increased volumes -> increased profits -> rising pay for management -> decreasing skilled labor 'making things' jobs -> wealth of the country (and the world) becomes more and more concentrated into the hands of a small demographic -> corporate personhood granted by Supreme Court (not sure exactly where on the timeline this goes, but it's part of the story) -> significantly more political influence for a smaller group of people at the top of pyramid -> Democrats join Republicans in courting this small, wealthy, influential demographic -> financial deregulation driven by that demographic, either financiers looking for more ways to increase returns, or m/billionaire management looking for better returns for their un-FDIC-insurable cash piles -> Less than 10 years after the last protections of the Great Depression era dismantled (Graham-Leach-Bliley '99), we have a similar-in-nature debt-driven financial crisis -> This time the small wealthy demographic that caused it has the power to 1) avoid punishment for it (for example, compared to the 1980 S&L crisis that saw thousands jailed), 2) transfer all the losses to the US Government -> The final result of which could be any/all of 1) monetary inflation and defacto dollar devaluation, 2) further debt deflation, 3) rising interest rates on baseline Treasuries leading to rising interest rates across the board and decreased corporate investment (and hiring), all of which will hurt the fading middle class more the wealth owners. This is just a cursory summation of observations of correlated events that I suspect are more than just correlated. It's still taking shape in my mind, and I'm sure someone could write a PhD dissertation on how all it all fits together, I just don't have time for this atm. But I do wish our politicians/media/pundits/economic book authors/people like Robert Reich/etc would look more at this big picture of how and why we got to this situation we're in, and how it might be possible to reverse it. Increasing concentration of wealth is a major problem, as you point out. It has been a cause of not only social unrest, but even revolutions. Definitely not a road a country wants to find itself on.

by dctoedt 16y ago

jbooth 16y ago

Not to mention that even without risks of total upheaval, if nobody but the top 1% has any money, who are you going to sell goods to?

SkyMarshal 16y ago

Upvoted for non-dogmatic thoughtfulness. Apologies if that sounds politically bigoted, but so much of what I hear coming the GoP these days is devoid of that quality. I hope you run for office some day. I think this issue is only part of a larger group of related problems that seemed to start metastasizing 30 years ago. In a nutshell: scientific management -> manufacturing process and profit margin optimization -> manufacturing outsourcing to low-cost countries -> decreased product costs + planned obsolescence -> increased volumes -> increased profits -> rising pay for management -> decreasing skilled labor 'making things' jobs -> wealth of the country (and the world) becomes more and more concentrated into the hands of a small demographic -> corporate personhood granted by Supreme Court (not sure exactly where on the timeline this goes, but it's part of the story) -> significantly more political influence for a smaller group of people at the top of pyramid -> Democrats join Republicans in courting this small, wealthy, influential demographic -> financial deregulation driven by that demographic, either financiers looking for more ways to increase returns, or m/billionaire management looking for better returns for their un-FDIC-insurable cash piles -> Less than 10 years after the last protections of the Great Depression era dismantled (Graham-Leach-Bliley '99), we have a similar-in-nature debt-driven financial crisis -> This time the small wealthy demographic that caused it has the power to 1) avoid punishment for it (for example, compared to the 1980 S&L crisis that saw thousands jailed), 2) transfer all the losses to the US Government -> The final result of which could be any/all of 1) monetary inflation and defacto dollar devaluation, 2) further debt deflation, 3) rising interest rates on baseline Treasuries leading to rising interest rates across the board and decreased corporate investment (and hiring), all of which will hurt the fading middle class more the wealth owners. This is just a cursory summation of observations of correlated events that I suspect are more than just correlated. It's still taking shape in my mind, and I'm sure someone could write a PhD dissertation on how all it all fits together, I just don't have time for this atm. But I do wish our politicians/media/pundits/economic book authors/people like Robert Reich/etc would look more at this big picture of how and why we got to this situation we're in, and how it might be possible to reverse it. Increasing concentration of wealth is a major problem, as you point out. It has been a cause of not only social unrest, but even revolutions. Definitely not a road a country wants to find itself on.