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Forums - General Discussion - Why I am leaving the US...

How much money was wasted on the Middle eastern wars? What are the social and-economic impact of these wars? Chasing ghosts in Arab desert. Fighting for freedom and democracy overseas. Right wing media claim they report fair and balanced media stories. 

Imposing autocratic government control measures upon your own people. Both political mainstream parties in every western world country has been doing this since the false flag terrorist attack on 9/11. Individuals can be taken away for no reason without charge by Federal Police. 

No audit has ever been conducted on the Reserve Bank. How have these interest rates remained so low for so long? Fiat Capital system. 



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theprof00 said:

I'm confused. Take now for a setting. Businesses aren't hiring because they aren't making enough revenue to cover the overhead. Welfare seems like it gives money to the consumers, and the consumers put money into the products that are popular, which in turn increases revenues and profits leading hiring more workers to open more stores and continue increasing revenue as is the capitalist formula.

If the govment got rid of welfare or even worse, things like unemployment, They would be effectively taking 1.2 trillion dollars away from businesses. According to 2002 census, there are 23.3 million businesses in the US http://www.census.gov/epcd/www/smallbus.html

But I've also heard that it's closer to 31 million now. So, we are looking at a loss per business of 38,000k on average. Many big box stores, retailers, and others, can afford to pay at least one person to work for each 38,000 in revenue. (Assuming 14,000$ worth of associated costs), which would equal 31 million jobs.

(as a fun fact, the tax collected on those purchases is 60B$ at a 5% sales tax that goes right into the state economies)

What I'm curious about, is what do you think the government should do instead? It seems pretty obvious that the government is "subsidizing" business through welfare.

I agree that more people should be working and producing more product, but conversely, if there is too much product, doesn't that also lower profit margin?

Also, what do you mean it would be put back into the economy anyway? It's taken out of taxes, right? What should they do? Lower taxes? And if so, who should they lower taxes for?


Money is just the physical representation of a unit of productive labour in the economy, and it exists because the results of an individual’s labour may not be of direct interest to another individual and money allows for an easy to manage 3 way (or 1000 way) trade of goods and services.

The government has 3 ways to generate money to cover welfare, it can tax individuals and businesses therefore reducing the amount of money they have and transferring it to others, they can print money which acts like a flat tax proportionately lowering the amount of money everyone has, or they can borrow money. All three of these approaches represent a transfer of money from a productive individual to an individual who is not productive, and it is likely (basically a certainty) that those individuals would have spent the money on another good or service if it wasn’t taken from them.

While the elimination of welfare might result in the lowering of economic output to produce goods and services for the welfare recipients, it also would result in a proportionate increase in economic output to cover the goods and services that productive individuals used with the money that was returned to them.

 

Now, one might assume that this is cruel because it suggests that the welfare recipients would be forced to live without money because they can’t find a job, but the economy isn’t static and doesn’t limit the amount of productive labour that can be done. As a software developer I’m doing work today producing in demand products that 20 years ago didn’t exist; and if the drain on individuals and businesses was removed there would be few people who couldn’t find jobs, and we would just have more in demand products produced that don’t exist today.

 

 

Edit: I thought it might be worthwhile to state this in a different way ...

Using my original numbers of 75% of people being productive workers and 25% of people being on welfare, if you reduced the number of people on welfare to 15% of the population the 75% of productive workers would see increases in their income (in real terms) which would enable them to buy additional goods and services; and the production of these goods and delivery of these services would require additional workers, and the 10% former welfare recipients would be able to find work.



I too favor a flat tax, simply because it's the most simple and elegant solution to the loophole problem. I know that people like Warren Buffet and others are aware of <1% tax loopholes and surely there are a lot of people that use it.

I agree that welfare should be reduced, but I'm not sure what is the better solution. Reduce payroll tax and increase your earnings by 10%? Put it into free healthcare? Soup kitchens?

I know that welfare is dishonest and unfair to those that work hard, but they do need some help. We just need them to figure out that they don't really want that "help". Many people are in debt and unable to contribute to businesses because of medical debt, but on the other hand, banks thrive off of debt which in turn gets lent to others to start other business, or buy homes.

So I really don't know what the best solution is.

To me, it makes sense how the welfare system works. Redistribute middle-class and lower class wages to the poor, keep everyone making around 20k (whether by work or welfare) a year, and keep them all owing money to the banks.

I don't like it though.

It just seems a lot more complex than just let employees keep their money, from a government and corporate standpoint, it seems more financially beneficial to lower all the earnings and keep everyone in debt. Like, if workers were able to keep that extra 10%, there would be less people in debt, more poor just completely without money and no way to repay debt, and it seems like it would remove a huge chunk of the banking income.