The Next Big Crash - Are You Prepared?

[freedom]

I realize that often our discussion derails to somewhere I believe non-essential.

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

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

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

So I assume we are agreeable on Medishield and Obamacare?

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

The rich are guilty of their richness?