OK, Robert, no problem. I created an account. (It was easy - you have an efficient blog!)
I agree with you that the obvious answer is technical innovation. Well, to be a bit more precise, innovation. Not all innovation is 'technical.'
In any event, to what do you attribute technical innovation? Don't you think there is a correlation with free enterprise? Do you think the inventor of the sewing machine you mentioned did it because he felt sorry for people sewing manually? To paraphrase a question Milton Friedman would ask, do you think he did it in response to some decree from the Department of Labor?
As for statistical data, here again we agree. I'm a big believer. I don't happen to see any statistics in any of your posts so far in this thread, just a series of unsupported claims such as, "the vast middle class only came into being when government stepped in on behalf of the many with regulations and protections, and set them against plutocratic power."
Are today's poor better off than the wealthy in the past? Let's just take a few 'qualitative' examples comparing Kings and Queens of 100 years ago or more with today's poor:
- How long did it take to travel 100 miles? How about 1000 or 3000 miles? Even if the poor can't afford an air flight, buses or trains are much faster - and more comfortable - than horses and carriages. And a majority of today's poor have their own cars, according to the Census Bureau.
- How were they treated for illnesses? Leeches? Bleeding? Can you even think to compare with health care today?
- Living conditions - no air conditioning, heating only by fire. The vast majority of today's poor have air conditioning.
The list could go on.
Brad DeLong, with whom, as an 'economic populist, I am sure you are familiar, wrote: "Today the average American possesses a degree of material comfort that in many ways outstrips the reach of even the richest humans of previous centuries."
Without any doubt that is primarily due to capitalism. I'm not sure why people are reluctant to recognize that fact.
I went off on this also. It's one thing to do something about those retirees getting into predatory circumstances with 2nd mortgages and home equity loans, which has happened, did happen in masse, but it's a whole other ball game to force the U.S. taxpayer to pay for complete irresponsibility that went on in these home equity loans.
We all know they were used to prop up our great "consumer economy" with massive debt, prolonging a middle class lifestyle one could no longer afford....
and so this punishes people like us, those ultra tightwads, who bypassed the entire bubble because they could add up the reality one could not afford a half a million dollar home...
now, we're getting left out of the free money party!
Believe me, pisses me off too. I certainly could have gotten a mortgage and I did not because I knew it was a bubble and I also knew no way in hell could I afford a half a million dollar home or a 3/4 of a million dollar home...
so I'm not too happy about this...it's rewarding the irresponsible and punishing the ones who were responsible..
at least so far in my reading of the details (in the original Instapopulist, a link to the details of the plan).
to avoid private mortgage insurance. Basically, to make the payments more affordable. Most of the second mortgages are worthless now with home values in the tank.
1. Protectionism (TARIFFS! were the primary method of funding US Federal Government up until the Income Tax), and progressiveness (increase in technology).
2. I'm not at all sure the poor in America DO live better than the wealthy did 100 years ago, and they're certainly worse off when you remove the thin veneer of technology than certain Native American tribes were in the 1700s, at least in terms of real security and being able to count on your kids having a better life than you did. The wealthy 100 years ago didn't need to go to the bank to beg money for every little expenditure, they didn't have to budget their food stamps to make it through the month, they had trains, steamships, and chauffeurs to travel. In many ways, the wealthy 100 years ago were much better off than the type of unemployed yokel you'll find in rural America today. Perhaps you've just lost touch with what it *really* means to be poor and in debt you can never repay.
-------------------------------------
Moral hazards would not exist in a system designed to eliminate fraud.
but ya know, if the entire global says "ok everybody, shut down now" and then as quickly as possible "shovels out the shit" in the system, i.e. CDSes, CDOs, etc. and then resets...
well beyond making speculators suffer, wouldn't everybody's pension funds and so forth that they are concerned about also reset at a new but equal lower level globally?
I mean gain and loss are relative terms so if they just had the entire globe be an "everybody loses" would we not notice the water levels are lower because everything now is?
I mean what a mess a $65 trillion dollar fictional economy, fictional money, global gambling casino extrodinaire and how does one plain shut the entire thing down with little real consequence?
This is the last post I enable as an anonymous drive-by. If you wish to participate, create an account.
The answers to these questions are obvious, technical innovation. The invention of the sewing machine increased the productivity of cloth, the invention of the automobile increased mobility, commerce, transport, fresh produce, etc...
Finally, there is no statistic evidence the poor in the United States are "better off" than the wealthy 100 years ago.
On EP, you need to back up your claims with accurate statistical data....
or suffer the consequence.
I have lost my ability to detect sarcasm. I have wondered for a long time whether the threat of systematic collapse was intentionally overstated by financial conglomerates.
I believe if anything the lack of clarity and transparency on the part of Treasury and Fed. increases systemic risk. If there are segments of the financial sector that are relatively healthy should we know that.
I agree that maybe we let, at the very least, the unsalvageable go.
What I'm implying is they threw all of this U.S. taxpayer money at Citigroup to avoid outright nationalization and they could have saved the taxpayer a ton of money and nationalized it, cleaned it up, head on.
The issue they are trying to avoid is systemic risk...
and if you see any projected analysis out there on scenarios of what would have happened if they just let these institutions fail, or simply nationalized certain banks, put them in a Resolution Trust Corporation and many of the alternatives....
That would be really enlightening...
because what I see is they are trying to salvage the shadow banking system, all of these derivatives, CDSes, CDOs, etc. from causing a domino type of economic collapse...
but I am wondering if they should have let the entire thing implode, just plain shut down the entire global financial system....let the fiction money disappear, the entire shadow banking system evaporate and then "reboot" the real financial system after some restructuring by governments.
One thing seems obvious, the current strategy is not working out too good and the justification for the current strategy are doomsday scenarios if they did not do things this way..
but it seems it will happen that way regardless of their efforts...
that's why we have all sorts of economists, experts from the far right to the far left all calling for bank nationalization akin to the Swedish action taken.
Thanks for posting this labor organization history lesson. I had no idea such a thing went on after 1934, what an eye opener!
I have a couple of questions. Just how many labor organizers, workers organizations were purged under the "red scare" of the 1950's when it was better to be a pedophile than a "pinko communist"....
how exactly did mixed economies, things like European style socialism, the UK social safety nets, Canada and so on get labeled "socialism" outright or associated with the totalitarian regimes of the USSR and China?
Those are very different systems, the later being more a Democratic socialist, mixed economy system or call it regulated capitalism vs. the outright terror, repression as well as empire of the former USSR and China's "cultural revolution"?
Also, did you see my email regarding Seeking Alpha wanting permission to publish your Freddie/Fannie article?
Adjustable rates, pre-payment penalties, high closing fees tacked on to principal. They were designed to fail by greedy mortgage brokers and their investors. But they didn't care because they didn't have any skin in the game. They were selling them to Bear Stearns or Fannie/Freddie.
Habitat for Humanity got it right and so did some community development banks and credit unions.
Our home mortgage system is screwed up beyond repair. We need a new way to finance home purchases.
And that is subprime loans from charity organizations. Perhaps the banks need to take a look at what groups like Habitat for Humanity have been doing for the last 30 years when working with subprime loans. I'll give them a couple hints- ARMs don't work, nor does loan origination with nothing down, nor do payments that exceed 30% of a family's income.
-------------------------------------
Moral hazards would not exist in a system designed to eliminate fraud.
Because the majority of outstanding Pay out ARM are scheduled to reset in 2010-2012. And with unemployment increasing Jumbo loans are starting to default.
If you want to help promote The Economic Populist, give more awareness we exist and we are the only site out there devoted to all things Econ where anyone can write and have their own blog....
Use the reddit, share buttons, forward EP to a friend or recommend, link over posts you find particularly insightful when commenting on other sites.
If you see some well researched, firmly grounded in fact, statistics and economy theory writers out there getting no readers, invite them over to The Economic Populist to post and participate.
Let's face it, Economics isn't too sexy, although we're working on that one!
Not bad for less than one year of really being dedicated economics bloggers.
I'm going to make this a poll question (It's Friday at 5pm, do you know which bank failed today?)
Right, they are pouring money into these Zombie institutions, Citigroup, AIG, BoA being the biggest and after all of that....we're probably looking at the same results before burning through all of that cash.
OK, Robert, no problem. I created an account. (It was easy - you have an efficient blog!)
I agree with you that the obvious answer is technical innovation. Well, to be a bit more precise, innovation. Not all innovation is 'technical.'
In any event, to what do you attribute technical innovation? Don't you think there is a correlation with free enterprise? Do you think the inventor of the sewing machine you mentioned did it because he felt sorry for people sewing manually? To paraphrase a question Milton Friedman would ask, do you think he did it in response to some decree from the Department of Labor?
As for statistical data, here again we agree. I'm a big believer. I don't happen to see any statistics in any of your posts so far in this thread, just a series of unsupported claims such as, "the vast middle class only came into being when government stepped in on behalf of the many with regulations and protections, and set them against plutocratic power."
Are today's poor better off than the wealthy in the past? Let's just take a few 'qualitative' examples comparing Kings and Queens of 100 years ago or more with today's poor:
- How long did it take to travel 100 miles? How about 1000 or 3000 miles? Even if the poor can't afford an air flight, buses or trains are much faster - and more comfortable - than horses and carriages. And a majority of today's poor have their own cars, according to the Census Bureau.
- How were they treated for illnesses? Leeches? Bleeding? Can you even think to compare with health care today?
- Living conditions - no air conditioning, heating only by fire. The vast majority of today's poor have air conditioning.
The list could go on.
Brad DeLong, with whom, as an 'economic populist, I am sure you are familiar, wrote: "Today the average American possesses a degree of material comfort that in many ways outstrips the reach of even the richest humans of previous centuries."
Without any doubt that is primarily due to capitalism. I'm not sure why people are reluctant to recognize that fact.
I went off on this also. It's one thing to do something about those retirees getting into predatory circumstances with 2nd mortgages and home equity loans, which has happened, did happen in masse, but it's a whole other ball game to force the U.S. taxpayer to pay for complete irresponsibility that went on in these home equity loans.
We all know they were used to prop up our great "consumer economy" with massive debt, prolonging a middle class lifestyle one could no longer afford....
and so this punishes people like us, those ultra tightwads, who bypassed the entire bubble because they could add up the reality one could not afford a half a million dollar home...
now, we're getting left out of the free money party!
Believe me, pisses me off too. I certainly could have gotten a mortgage and I did not because I knew it was a bubble and I also knew no way in hell could I afford a half a million dollar home or a 3/4 of a million dollar home...
so I'm not too happy about this...it's rewarding the irresponsible and punishing the ones who were responsible..
at least so far in my reading of the details (in the original Instapopulist, a link to the details of the plan).
to the party.
It has always been about class warfare.
a way for many mortgage brokers to push No Downpayment loans and avoid PMI.
First mortgage would be for 80% of value and second mortgage would be for the remaining 20%.
I put this in the Instapopulist yesterday. Obama's Housing Plan Lets Home Equity Loans be Forgiven.
I guess ya all missed it.
the borrow achieves 20% equity in their loan.
Some seconds were taken out to put a down payment on a home purchase. After that though???
It has always been about class warfare.
to avoid private mortgage insurance. Basically, to make the payments more affordable. Most of the second mortgages are worthless now with home values in the tank.
1. Protectionism (TARIFFS! were the primary method of funding US Federal Government up until the Income Tax), and progressiveness (increase in technology).
2. I'm not at all sure the poor in America DO live better than the wealthy did 100 years ago, and they're certainly worse off when you remove the thin veneer of technology than certain Native American tribes were in the 1700s, at least in terms of real security and being able to count on your kids having a better life than you did. The wealthy 100 years ago didn't need to go to the bank to beg money for every little expenditure, they didn't have to budget their food stamps to make it through the month, they had trains, steamships, and chauffeurs to travel. In many ways, the wealthy 100 years ago were much better off than the type of unemployed yokel you'll find in rural America today. Perhaps you've just lost touch with what it *really* means to be poor and in debt you can never repay.
-------------------------------------
Moral hazards would not exist in a system designed to eliminate fraud.
but ya know, if the entire global says "ok everybody, shut down now" and then as quickly as possible "shovels out the shit" in the system, i.e. CDSes, CDOs, etc. and then resets...
well beyond making speculators suffer, wouldn't everybody's pension funds and so forth that they are concerned about also reset at a new but equal lower level globally?
I mean gain and loss are relative terms so if they just had the entire globe be an "everybody loses" would we not notice the water levels are lower because everything now is?
I mean what a mess a $65 trillion dollar fictional economy, fictional money, global gambling casino extrodinaire and how does one plain shut the entire thing down with little real consequence?
This is the last post I enable as an anonymous drive-by. If you wish to participate, create an account.
The answers to these questions are obvious, technical innovation. The invention of the sewing machine increased the productivity of cloth, the invention of the automobile increased mobility, commerce, transport, fresh produce, etc...
Finally, there is no statistic evidence the poor in the United States are "better off" than the wealthy 100 years ago.
On EP, you need to back up your claims with accurate statistical data....
or suffer the consequence.
I have lost my ability to detect sarcasm. I have wondered for a long time whether the threat of systematic collapse was intentionally overstated by financial conglomerates.
I believe if anything the lack of clarity and transparency on the part of Treasury and Fed. increases systemic risk. If there are segments of the financial sector that are relatively healthy should we know that.
I agree that maybe we let, at the very least, the unsalvageable go.
What I'm implying is they threw all of this U.S. taxpayer money at Citigroup to avoid outright nationalization and they could have saved the taxpayer a ton of money and nationalized it, cleaned it up, head on.
The issue they are trying to avoid is systemic risk...
and if you see any projected analysis out there on scenarios of what would have happened if they just let these institutions fail, or simply nationalized certain banks, put them in a Resolution Trust Corporation and many of the alternatives....
That would be really enlightening...
because what I see is they are trying to salvage the shadow banking system, all of these derivatives, CDSes, CDOs, etc. from causing a domino type of economic collapse...
but I am wondering if they should have let the entire thing implode, just plain shut down the entire global financial system....let the fiction money disappear, the entire shadow banking system evaporate and then "reboot" the real financial system after some restructuring by governments.
One thing seems obvious, the current strategy is not working out too good and the justification for the current strategy are doomsday scenarios if they did not do things this way..
but it seems it will happen that way regardless of their efforts...
that's why we have all sorts of economists, experts from the far right to the far left all calling for bank nationalization akin to the Swedish action taken.
Thanks for posting this labor organization history lesson. I had no idea such a thing went on after 1934, what an eye opener!
I have a couple of questions. Just how many labor organizers, workers organizations were purged under the "red scare" of the 1950's when it was better to be a pedophile than a "pinko communist"....
how exactly did mixed economies, things like European style socialism, the UK social safety nets, Canada and so on get labeled "socialism" outright or associated with the totalitarian regimes of the USSR and China?
Those are very different systems, the later being more a Democratic socialist, mixed economy system or call it regulated capitalism vs. the outright terror, repression as well as empire of the former USSR and China's "cultural revolution"?
Also, did you see my email regarding Seeking Alpha wanting permission to publish your Freddie/Fannie article?
OK, so a couple of questions:
1. To what do you attribute the increase in living standards in the US prior to the New Deal?
2. Considering the poor in America live better than the wealthy did 100 years ago, how does laissez-faire 'drive the rest of society towards poverty?'
Adjustable rates, pre-payment penalties, high closing fees tacked on to principal. They were designed to fail by greedy mortgage brokers and their investors. But they didn't care because they didn't have any skin in the game. They were selling them to Bear Stearns or Fannie/Freddie.
Habitat for Humanity got it right and so did some community development banks and credit unions.
Our home mortgage system is screwed up beyond repair. We need a new way to finance home purchases.
As for this quasi-nationalization, ownership without control is a recipe for disaster.
And that is subprime loans from charity organizations. Perhaps the banks need to take a look at what groups like Habitat for Humanity have been doing for the last 30 years when working with subprime loans. I'll give them a couple hints- ARMs don't work, nor does loan origination with nothing down, nor do payments that exceed 30% of a family's income.
-------------------------------------
Moral hazards would not exist in a system designed to eliminate fraud.
Because the majority of outstanding Pay out ARM are scheduled to reset in 2010-2012. And with unemployment increasing Jumbo loans are starting to default.
Gongol.com has EP moving up, now about 31 on the Economics blog rankings.
Technorati has EP ranked at 61,210 of all blogs.
If you want to help promote The Economic Populist, give more awareness we exist and we are the only site out there devoted to all things Econ where anyone can write and have their own blog....
Use the reddit, share buttons, forward EP to a friend or recommend, link over posts you find particularly insightful when commenting on other sites.
If you see some well researched, firmly grounded in fact, statistics and economy theory writers out there getting no readers, invite them over to The Economic Populist to post and participate.
Let's face it, Economics isn't too sexy, although we're working on that one!
Not bad for less than one year of really being dedicated economics bloggers.
I'm going to make this a poll question (It's Friday at 5pm, do you know which bank failed today?)
Right, they are pouring money into these Zombie institutions, Citigroup, AIG, BoA being the biggest and after all of that....we're probably looking at the same results before burning through all of that cash.
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