Re: Fraud in the CPI

On Mon, 3 Dec 2007 12:03:22 -0600, "John Galt"
<whoisjohngalt@xxxxxxxxxxxxxx> wrote:


"Rumpelstiltskin" <PleaseDoNotReplyByEmail@xxxxxxxxxxx> wrote in message
news:ntd8l3lgko201tvh70ca8io6midmbu9ibj@xxxxxxxxxx
On Mon, 3 Dec 2007 10:59:51 -0600, "John Galt"
<whoisjohngalt@xxxxxxxxxxxxxx> wrote:


"Rumpelstiltskin" <PleaseDoNotReplyByEmail@xxxxxxxxxxx> wrote in message


<snip>


People first, not as a side-benefit. If you look at
business and assume as long as business is OK
then the people will be, they might not be.

Uh.....whatever. You still can't have one without the other.



Yes you can. There's the French aristocracy,

How did the French aristocracy earn money without any laborers?



Red herring. Your contention was that "you
can't have one without the other" regarding
the health of business and the health of people.
Nobody suggested, or would suggest, that money
could be made without labourers, in fact, that's
more in support of my point than yours.



and
the amazing thing Krugman said lately, that the top
hedge-fund manager in the USA made more money
last year than all 80,000 teachers in the NYC school
system made and will make for the next two years,
all added together. Don't try to tell me that doesn't
have much effect on people who aren't rich, even
that single instance!

Hm? You think the hedge fund manager doesn't have a staff? A company that
employs people?


We're talking about the money the hedge manager
himself made. Even if he had a thousand workers
and paid them out of his own pocket, he would
still make out astronomically.




The following isn't the particular talk I heard, but
here's a reference to that observation of Krugman's,
under "The New Gilded Age" three paragraphs
down from the top:
http://seattlest.com/2007/11/02/paul_krugman_on.php

Maybe you think it's OK. I think it's unspeakable.
It makes me want to look into plans for constructing
a guillotine, since it might be time to bring that back.

No, but I also realize that a single exception doesn't make a rule.



That's why I said "even that single instance".



(So does
Krugman, but when he gets political, he dissembles.)



A bit further down, "The Great Compression" is one
of the great phrases I heard in Krugman's talk that
I couldn't remember later.

<snip?


In the 1960's, one breadwinner could support a family.
Yeah, I know about computers and VCR's and whatnot,
but even families who don't have those things need
both parents working these days far more often than
before. That's one way it can be argued that quality of
life has decreased.

That's why reality is subjective. Many americans have jumped on the 50's
and
60's as an ideal, but to me, it's not reasonable to choose the only 30
year
block in human history when familes who were not rich could get by on a
single salary. Is it a decrease in quality of life? Sure. Was it
reasonable
to expect even a perfectly run economy to maintain that standard? No.


Why did it stop?

Inflation, mostly. Developing nations often experience a temporary wealth
boom, except it's not really a boom -- it's a moment in time where wealth
starts to pour into the hands of the people, but inflation hasn't acted on
the economy yet. You see it happening now in ASEAN, China, and India now.
Then, inflation follows the infusion of wealth, and the situation
stabilizes.


Nonsense. We were not a "developing nation". Comparable
goods were being made in the 1960's as are being made now,
yet in the 1960's one person could support a family. There's
nothing about "now" that makes purchasing power magically
disappear into thin air which it didn't do in the 1960's. It's not
disappearing into thin air now - it's just not going as evenly
into the pockets of the people.

As to inflation, it's the result of deficit spending which is in
effect "printing money" and thereby deflating the money
already in existence, because money represents the wealth
of the nation so if there's more printed, each piece
represents a smaller share in the nation's wealth. However,
if rewards were distributed the same, inflation would have no
net effect on money that was being made at the moment,
because although what cost $60 before now costs $80, the
worker would have another $20 bill in his paycheck because
although the money is worth less, his labour is worth the
same, not in dollars but in production. That's as long as the
money is being distributed as equitably as before.

"Louis XIV was a magician who could make people believe
that paper was money."




We could probably still do it, except
for the increase in wealth disparity.

Uh, no. The US citizenry has a net worth of 56T. Divide that equally amongst
310,000,000 citizens, and you get 183K per person. That seems like a lot,
but as you well know living in SF, you can't buy a house for it. Or, another
way of putting it would be that if you divided it up and told one spouse to
stay home and live off the interest of the 183K, that would be between 10
and 18K per year depending on your rate of return., Most workers would
consider that to be a pay cut.


How did we do it in 1960 then? People weren't
two or three times as productive then than they are now.


As I've said often
in my commie way, it takes a lot of poor people to
support one rich person.

That's not commie -- it's capitalistic, you just have to turn it around. I
can't remember the name of the landed rich family -- but he was from San
Francisco -- who said "I'd rather have 10% of a thousand people's labor than
100% of my own."


Of course, wealth always comes from the labour of other
people. Bill Gates wouldn't be rich if he had to build his
computers himself or if he were paid an hourly wage for
his labour developing his own operating systems.

"Exorbitant" wealth comes from what has been called
the "exploitation" of other people, which just means paying
them enough less than their labour produces that you can
get a much bigger result for yourself. You can get away
with that because have "control the means of production"
and of distribution.



JG


In England back before I was 6 in 1951, hardly any
married women worked, and people got along fine
though we weren't rich. That was right after the war
too, a bad time for England economically.

<snip>



.

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