First  Prev  1  2  Next  Last
How We took Our Economic Insanity for Granted
Posted 2/18/11 , edited 2/18/11
It all started when I read this article written by "Dilbert" creator Scott Adams, thanks to Northboundsnow's contribution:

I can think of five benefits that the country could offer to the rich in return for higher taxes: time, gratitude, incentives, shared pain and power.



Time. It's useful to keep in mind how the rich are different. When you are poor, you are willing to trade your time to earn money. When you are rich, you trade your money to get more time. For example, the rich hire people to clean their homes, and they don't waste time shopping for bargains. In business school I learned that when people have different preferences, you can usually find a way to engineer a deal.

Suppose we change the tax code so that in return for higher taxes on the rich, we figure out a way to give the rich some form of extra time. The bad version is that anyone who pays taxes at a rate above some set amount gets to use the car pool lane without a passenger. Or perhaps the rich are allowed to park in handicapped-only spaces.

Ridiculous, you cry! Remember, this is the bad version. And if the rich are only a tiny percentage of the population, they would have almost no impact on the traffic in car pool lanes or the availability of parking spaces for the handicapped. You wouldn't even notice the difference.

You could imagine a host of ways the government could trade time for money. Suppose all government agencies had a mandate to handle the affairs of the rich before everyone else. You wouldn't even notice that your wait at the Department of Motor Vehicles was 2% longer.

As a bonus, what happens to the economy when the people who are most skilled at making money suddenly have extra time? My bet is that they stimulate the economy by spending more or by earning more.

Gratitude. Imagine that the government arranges to provide genuine person-to-person gratitude to the rich in exchange for higher tax rates. Suppose (bad idea alert) the government makes it a condition that anyone applying for social services has to write a personal thank-you note to a nearby rich person who, according to a central database, hasn't lately received one. Gratitude goes a long way. It's easy to hate the generic overspending of the government. It's harder to begrudge medical care to someone who thanks you personally. It's a bad idea, I know. Don't judge it. Just let it nudge your imagination to someplace better.

Incentives. Another approach, also a bad idea, might be to treat the rich more like venture capitalists than sources of free money. Suppose the tax code is redesigned so that the rich only pay taxes to fund social services, such as health care and social security. This gives the rich an incentive to find ways to reduce the need for those services, which would in turn keep their taxes under control. Perhaps you'd see an explosion of private investment in technologies that make it less expensive to provide health care. You might see rapid advances in bringing down the cost of housing for seniors.

Meanwhile, the middle class would be in charge of funding the military. That feels right. The country generally doesn't go to war unless the middle-class majority is on board.

Shared Pain. Happiness is a relative thing. That's how humans are wired. And we're just screwed up enough to feel comfort when our pain is shared. So how can we make the overtaxed rich feel as if the rest of society is feeling a little extra pain?

I doubt that the rich will agree to higher taxes until some serious budget cutting is happening at the same time. That makes the sacrifice seem shared. The rich will feel unfairly singled out unless everyone is taking a hit. And budget cuts make the government seem better managed. That matters.

The bad idea here is to change the debate from arguing about which programs and how much to cut, and instead to do what the private sector has been doing for decades: Pull a random yet round number out of your ear, let's say a 10% cut, just for argument's sake, and apply it across the board. No exceptions. Everything from the military to welfare to federal pensions to government salaries would take the same hit. Managers in the private sector have been handling budget cuts this way for years. They know that their subordinates are all professional liars, so there is no reliable information for making cuts in a more reasoned way. They also know that any project can get by with 10% less money if there is no alternative.

Power. Everyone loves power. I'm guessing that the rich like it more than most people, on average. Another bad idea is to give the rich two votes apiece in any election. That's double the power of other citizens. But don't worry that it will distort election results. There aren't that many rich people, and they are somewhat divided in their opinions, just like the rest of the world. And realistically, is the candidate who gets 51% of the vote always better than the one who gets only 49%? That's a risk I'll take.(citation)
And the irony is that these ideas just might play up the rich's narcissism, by giving them exactly what they want as narcissists:

From my perspective as a boomer, what have I discovered about the cohort who are (and will be) current college students and entry level communications practitioners? Here are ten characteristics:

1. Generation Direct — On the TV teen soap, The O.C., a father chides his son with “Watch your mouth. I was trying to be polite. You might want to give it a try.” The son’s response? “No thanks. I’d rather be honest.” Being open, almost guileless, is preferred; even if others might interpret it as rudeness. It’s about being true to yourself. Or, as the t-shirts proclaim: It’s all about me. This candour has found a ready outlet in online networks like Facebook where every social and sexual burp in life is readily shared with lots of strangers.

2. Generation Self-Esteem — The guilt here lies primarily with the boomers, the folks who enshrined the concept of self-esteem into education and child-raising. Many schools have “specific programs to increase children’s self-esteem, most of which actually build self-importance and narcissism.” Kids need to feel good about themselves. Some educators don’t want to disturb that feeling by actually correcting mistakes in class. Inflated grades and independent spelling are two by-products of the self-esteem movement. When these bump against the reality of quality control at college or on the job, Generation Me is genuinely surprised — and who can blame them?

3. Generation Entitlement — The cocoon of self-centredness has left young people feeling that they deserve everything right away. Interns expect positions where they’ll be given plenty of responsibility from the beginning. Earlier this week, a PR agency VP told me about her surprise at the lofty short-term ambitions of some of her staff. It’s tough to manage expectations of employees who have never encountered the quaint concept of ‘paying your dues’.

4. Generation Thin-Skin — Generation Me doesn’t respond well to criticism. In many cases, it has never been part of their upbringing. They feel they can’t do wrong. So, when the boss rips into them about a half-effort on the job, they’re devastated. In the past, most people have complimented them on their efforts — no matter how shoddy or lazy those efforts might actually be. (You would think watching Donald Trump and Simon Cowell on reality TV would have prepared them!)

5. Generation Dream-the-Impossible-Dream — “You can be whatever you want to be.” “Never give up on your dream.” “Nothing is impossible.” Coupled with the concept of entitlement, this can be a potent brew. I see it first-hand in applicants who really want to work in public relations but can’t write. No one ever drew the problem to their attention, so they never made much effort to work on it or strengthen it Once again, everything was fine until pesky reality intervened.

6. Generation Get-an-Education — There’s more pressure than ever to get a good education. A degree is no guarantee to a career. In fact, that’s why there are so many graduate certificate programs in community colleges. But it’s often still not enough. Generation Me may have learned they can be whatever they want to be, but just what is that exactly? Many agonize over finding the right profession. It’s an agony that prevents them from finding any profession. Of course, there’s always another academic credential and another extended stay at home.

7. Generation Don’t-Want-To-Be-Bored — Skills help prepare students for the workplace. But what prepares them emotionally? The cult of self-esteem, plus the prevalence of film & TV characters (and the actors themselves!) in exciting jobs, sets Generation Me up for a fall. Job descriptions and salary expectations often can’t match the inspired expectations that have been cultivated.

8. Generation It’s-Not-My-Fault — This starts early when GenMe kids discover how often their shortcomings in school are blamed on their teachers. It’s always external forces at work. And so, the victim mentality is nurtured.

9. Generation Tough-to-Make-a-Living — Yes, the GenMe has high expectations, but some of it is justified. Economically, it’s much harder today to get a career started. Whopping student debts, whopping house prices and whopping child care fees have created hurdles the boomers generally didn’t face. My first house cost two-and-half times my annual salary. How many entry-level practitioners can pull that off today? The pricetag on my first car was 40 per cent of my salary. Again, not so easily done today. We boomers have a tendency to set our own historical measuring sticks up against today’s reality.

10. Generation Can’t-Change-a-Thing — Here’s where the It’s-All-About-Me-I-Can-Do-Anything syndrome encounters a dichotomy. For all the self-confidence, there is also a cynicism that most things are beyond their control. So, why bother. Why bother to work hard at finding a job; it just comes down to being in the right place at the right time. Why bother to work hard for a promotion; it’s who you know, not what you know. Why bother to vote; my single ballot will influence nothing.(citation)
And it all started with something that seemed so harmless and full of good intention, and obviously taken for granted:

How is Generation Me different from previous generations, especially from the "Me generation" of the 1970s?

Baby Boomers were sometimes called the "Me generation" in the 1970s, but this was a premature and brief label: Boomers did not discover the self until young adulthood, and even then did everything in groups, from protests to seminars like est. Generation Me has never known a world that put duty before self, and believes that the needs of the individual should come first. This is not the same thing as being selfish – it is captured, instead, in the phrases we so often hear: "Be yourself," "Believe in yourself," "You must love yourself before you can love someone else." These are some of our culture's most deeply entrenched beliefs, and Generation Me has grown up hearing them whispered in our ears like the subliminally conditioned children in Aldous Huxley's Brave New World.(citation)
So the insanity behind all of these is the mainstream American belief that the same self-serving egoism can somehow fix the economy once again:

Try to imagine that the idea that saves the country is an entirely new one. It's too much of a stretch to imagine that a stale idea would suddenly become acceptable. In fact, that's the dividing line between imagination and insanity. Only crazy people imagine that bad ideas can suddenly become good if you keep trying them. So let's assume that our imagined solution is a brand new idea. That feels less crazy and more optimistic. Another advantage is that no one has an entrenched view about an idea that has never been heard.(citation)
And what makes Gen ME such a bad idea if it's newer that the previous generation? Because there's no such thing as Gen ME according to the cultural pattern it's displaying. Underneath the new label, it's still the same old ethnocentrism that justified colonialism and racism. And the worst part is, without a formidable adversary to act as its counterbalance, it's crippling and disabling the modern civilization with overinflated egoism:

Is there any hope for the US? Well yes, for two reasons. First, the declinists have been around in various guises before and they have always been wrong. The US has an ability to cope with its problems that no other country has ever matched. Secondly, the US has some key advantages in a world of digital knowledge and technology. Virtually all the world's great universities are there and, as Anne-Marie Slaughter of Princeton says, one of the first things they teach is to question the teacher.(citation)
I think Naomi Klein had something to share about just that mentality. Such as what kind of innovation is inspired by the self-fulfilling prophecy of "What would you attempt to do if you knew you could not fail."

And then when you come across something different from what the mainstream media is advocating. Can people truly immerse themselves in the possibility of an economy sustained by altruism? Consider the facts of just exactly what mainstream is all about when it comes to vanity and exploitation, that's every bit unsustainable by the unrealistic and immoral growth which inflates it. And the psychology of synthetic happiness confirms this:

A shopping mall full of zen monks is not going to be particularly profitable, because they don't want stuff enough.
So our current economic reality is simply this:

It's a story about us, people, being persuaded to spend money we don't have, on things we don't need, to create impression that won't last, on people we don't care about.
Essentially, we're still at war in "the land of confusion." And the persuasion starts from this illusion of more choices means more freedom, and thus more natural happiness. But the reality is just the opposite. When real freedom means the ability to free others, whereas the opposite is an addiction to risk.
Posted 2/18/11
Financial egocentricity is the order of the day, and it is a rotting cesspool, if you ask me. People will make money just to make more money, and rub it in everyone's faces.
1288 cr points
Send Message: Send PM GB Post
A small place in...
Offline
Posted 2/19/11
The first thing you learn if you study economics is,
1. Resources are scarce,
2. Opportunity cost.
3. A nation/self can only prosper at the expense of another.

A boat that can fit 5 people but try to fit in 10 will sink. Its a pity but we neglected the environment and their warning signs, we simplify our main food crops to just 3, grain, wheat and corn. We adopted a Gen ME lifestyle by which we can not sustain.
Posted 2/20/11

NE1469 wrote:

Financial egocentricity is the order of the day, and it is a rotting cesspool, if you ask me. People will make money just to make more money, and rub it in everyone's faces.
Don't you mean "feces?"


Northboundsnow wrote:

The first thing you learn if you study economics is,
1. Resources are scarce,
2. Opportunity cost.
3. A nation/self can only prosper at the expense of another.

A boat that can fit 5 people but try to fit in 10 will sink. Its a pity but we neglected the environment and their warning signs, we simplify our main food crops to just 3, grain, wheat and corn. We adopted a Gen ME lifestyle by which we can not sustain.
What's more, this unsustainable system comes with a massive environmental and societal hidden cost, when the quality of life is about balance. Not unlimited choices.
Posted 2/20/11

DomFortress wrote:


NE1469 wrote:

Financial egocentricity is the order of the day, and it is a rotting cesspool, if you ask me. People will make money just to make more money, and rub it in everyone's faces.
Don't you mean "feces?"

Sounds about right. How many lives must be destroyed for just one person to gain financial backing unnecessary to his/her survival?
Posted 2/20/11

NE1469 wrote:


DomFortress wrote:

Don't you mean "feces?"


Sounds about right. How many lives must be destroyed for just one person to gain financial backing unnecessary to his/her survival?
This was before the financial crisis hit:

On the other side of the class divide, the rise in CEO pay may reflect the increasing power of chief executives as compared to major owners and stockholders in general, not just their increasing power over workers. CEOs may now be the center of gravity in the corporate community and the power elite, displacing the leaders in wealthy owning families (e.g., the second and third generations of the Walton family, the owners of Wal-Mart). True enough, the CEOs are sometimes ousted by their generally go-along boards of directors, but they are able to make hay and throw their weight around during the time they are king of the mountain.(citation)
On a scale level:

According to Business Week, the average CEO of a major corporation made 42 times the average hourly worker's pay in 1980. By 1990 that had almost doubled to 85 times. In 2000, the average CEO salary reached an unbelievable 531 times that of the average hourly worker.(citation)
Butt, pun intended, this is the reality behind that illusion:

We found that as long as the task involved only mechanical skill, bonuses worked as we usually expect: the higher the pay, the better the performance. But when the task required even rudimentary cognitive skill (as we hope investment banking does), the outcome was identical to the India study: A higher bonus on the line led to poorer performance.(citation)
Posted 2/21/11

Northboundsnow wrote:

The first thing you learn if you study economics is,

(...)

3. A nation/self can only prosper at the expense of another.


In Europe we aren't taught that.
Posted 2/21/11

Okazu606 wrote:


Northboundsnow wrote:

The first thing you learn if you study economics is,

(...)

3. A nation/self can only prosper at the expense of another.


In Europe we aren't taught that.
What are the "Boxer Rebellion," "Opium War," and just about every counter-movements against Western colonialism.
54478 cr points
Send Message: Send PM GB Post
30 / M
Offline
Posted 2/21/11

Northboundsnow wrote:
3. A nation/self can only prosper at the expense of another.


Correct me if I'm wrong, shouldn't this be false since both parties can gain from trade due to comparative advantage?
Posted 2/21/11

Taedrin wrote:


Northboundsnow wrote:
3. A nation/self can only prosper at the expense of another.


Correct me if I'm wrong, shouldn't this be false since both parties can gain from trade due to comparative advantage?


True, since much of business is who can fuck who out of their money the hardest.
Posted 2/22/11

Taedrin wrote:


Correct me if I'm wrong, shouldn't this be false since both parties can gain from trade due to comparative advantage?

NE1469 wrote:



True, since much of business is who can fuck who out of their money the hardest.
What you both been describing is known as the "zero-sum" game in business based on the modernization of competition and consumption. It's completely opposite of the "win-win" or "social" businesses based on empathy as human intrinsic motivation.
Posted 2/22/11

DomFortress wrote:


Taedrin wrote:


Correct me if I'm wrong, shouldn't this be false since both parties can gain from trade due to comparative advantage?

NE1469 wrote:



True, since much of business is who can fuck who out of their money the hardest.
What you both been describing is known as the "zero-sum" game in business based on the modernization of competition and consumption. It's completely opposite of the "win-win" or "social" businesses based on empathy as human intrinsic motivation.


It is much better to compete than to insidiously deceive a rival out of their money. Or with consumers, at least have the ethical sense to not falsely advertise in order to further cheat people out of their hard earned cash. But, there is nothing wrong with cheating the cheaters, for they'd just be getting what they deserve, and I, for one, would have the shrewdness of an Arab trader.
Posted 2/22/11 , edited 2/22/11

NE1469 wrote:



It is much better to compete than to insidiously deceive a rival out of their money. Or with consumers, at least have the ethical sense to not falsely advertise in order to further cheat people out of their hard earned cash. But, there is nothing wrong with cheating the cheaters, for they'd just be getting what they deserve, and I, for one, would have the shrewdness of an Arab trader.
Two wrongs don't make a right, when you need to consider what's the "socioeconomic" comparative advantage the society will gain from a passionate teacher, as opposed to a corporate CEO.
Posted 2/22/11 , edited 2/22/11

DomFortress wrote:


NE1469 wrote:



It is much better to compete than to insidiously deceive a rival out of their money. Or with consumers, at least have the ethical sense to not falsely advertise in order to further cheat people out of their hard earned cash. But, there is nothing wrong with cheating the cheaters, for they'd just be getting what they deserve, and I, for one, would have the shrewdness of an Arab trader.
Two wrongs don't make a right, when you need to consider what's the "socioeconomic" comparative advantage the society will gain from a passionate teacher, as opposed to a corporate CEO.


So we should kill Joseph Sherk? Well, it isn't a question. Wall Street is pure criminality.

And yes, I can see where cheaters cheating each other would just make things worse. They'd bring other people in on it so more lives can be rear ended.
Posted 2/22/11

NE1469 wrote:



So we should kill Joseph Sherk? Well, it isn't a question. Wall Street is pure criminality.

And yes, I can see where cheaters cheating each other would just make things worse. They'd bring other people in on it so more lives can be rear ended.
Then reform it. It's the system that's at fault, changing the inmates won't solve the the system that's broken on purpose in the first place.
First  Prev  1  2  Next  Last
You must be logged in to post.