[OT]America. The land of the not-so-free (economy)

[Derek Martin]

On Sat, Jan 08, 2005 at 10:44:11AM -0500, Fred wrote:
> > The fact is, the average American can't be trusted to manage their
> > money.  Case in point: the ever-rising credit card debt owed by
> > American citizens...
> 
> Hold it right there! What is this "can't be trusted" statement? Can't be
> trusted by whom? Why is it even an issue of "trust"?

It was a turn of phrase...  It's not an issue of trust, but one of an
unfortunate reality.  Average people aren't good at managing their
money, and they never will be.  In principle, I agree with you --
people should make their own choices, and live with the consequences
of them.  In practice, the world doesn't work that way anymore.  If
you try to make that happen, you're condemning a whole lot of people
to poverty, misery, and/or even death.

Our society has this idea that, because we are "civilized" (whatever
that means) and "intelligent" (for some definition thereof), and our
civilization is wealthy, we have a moral obligation to care for those
who need it.  We can not allow people to die just because they have
made bad choices in life, or are much less fortunate than some.

This is an idealism which I think nearly everyone agrees with, at
least in some capacity.  However, idealism aside, there are practical
issues to contend with.

In today's modern world, there are an abundance jobs which don't pay
enough that those doing them can actually afford to feed and house
themselves.  These people absolutely CAN'T manage their own
retimrement -- they can't even eat dinner some days.  Someone who
cleans toilets at McDonalds in Boston probably falls into this
category.  But we need people to do these jobs, too.

In the old days, things were a lot different.  All you needed to do
was find a plot of land which no one had claimed already, build a
little house there from the abundant forestation, and grow stuff.
Life was relatively easy.  If you ran into trouble, your neighbors
would probably help you out.  More of that "moral obligation" idea at
work.  These days, people are too busy working 12 hours a day to feed
their families (and their excesses) to hve time to help you.  So
instead we collect taxes, and redistribute the money in as fair a
manner as we can manage.

It's not a perfect system, by any means, but most people (even many
people who call themselves libertarians) find this preferable to
letting people starve to death on account of some misfortune.

> Libertarians and Socialists. Libertarians feel that everyone should be
> responsible for their decisions -- and live and die by the results.
> Socialists feel that everyone "must be protected from themselves". Even

I don't think people should be protected from themselves; but at the
same time, I don't think it's unreasonable to be compassionate to
people who have experienced hardship.  If you've ever collected
unemployment, you'd probably have starved to death if this extreme
libertarianism that you're describing ever had come to pass.

Which raises an interesting point.  Have you ever collected
unemployment?  If so, one might go so far as to suggest that you are
being hypocritical...

[This is rhetoric.  I'm not really interested in the answer, just
making a point.]

> at gunpoint, which brings a supreme irony to that view. "I will protect
> you from yourself, even if I have to kill you to do it!"
> 
> > The other fact is, even smart invenstors screw up -- big time.
> 
> So what?

So, most people aren't smart investors.  Left to their own devices,
most people WILL lose their nest egg.  I can't see any way in which
this is good for society.

> > How many people committed suicide after losing all their money in the
> > financial markets during the Great Depression?
> 
> So what?

So, if you get rid of SS, and force people to fend for themselves, a
lot of them will starve to death when they get to retimrement age.  It
already happens more often than it probably should...  I don't believe
you're so callous that you think nothing of that.

> If you go about "protecting" people from themselves, they never learn
> how to live. Trump was able to recover *because* he learned a valuable
> lesson from having been at the top before and failing. Now, he knows not
> to repeat the same mistakes again.

Nonsense.  Trump was able to recover because he had rich friends who
had enough confidence in him that they were willing to lend him
millions of dollars (at a profit, of course) to effect his recovery.
And because he is (and always was) extremely business-savvy.  I doubt
he learned anything from his bankruptcy, other than PERHAPS some small
measure of humility.

> We all must be allowed to fail and fall flat on our faces. Only through
> that do we learn to become more efficient at how we handle our affairs.

I think that's nonsense too.  Most people who are rich today got that
way because daddy and mommy were rich.  They never had a chance to
fail.  Granted, the modern markets and the technology boom made more
new millionaires than in any other period in history; but if you
researched it I bet youd find that it also had one of the highest
rates of financial ruin, too.  A lot of people who invested in
Internet start-ups, and many of the millionaires who were made that
way, went bankrupt after the bubble burst.

Donald Trump is an exception; I think you'll find that most
millionaires who go bankrupt tend to stay that way.

> > > government, sometimes a bad solution in theory turns out to be in
> > > practice much better (in terms of workability) than the others.
> > 
> > What we need is for the government to stop playing card tricks with
> > people's money...  I'm not going to hold my breath waiting though.
> 
> Yes, they should return the money back to the people from whence they
> stole it. Let the people deal with their own money and do their own
> planning, investing, saving, etc. 

You obviously do your own investing, and have had pretty good luck
with your investments.  I think your story would be a lot different if
you'd had a lot of bad investments...  Doing well at investing takes a
lot of time and energy spent on education about mone and the markets,
and research of companies and other investment devices (or just being
plain lucky).  Financial markets are also heavily influenced by the
actions of large institutional investors who typically control
millions of shares in the companies in which they invest.  If you're
on the wrong side of their trades often enough, that alone could make
you broke fast.

Investing is a complicated game.  Even if most people WERE smart
enough to be good at it, most people don't have the time to put into
it, because their too busy dealing with their already too hectic
every-day lives.  As a result, they lose their shirts.

> build their own base. The government's only role should be in protecting
> our boarders and protecting us from each other (though it currently
> carries that way too far).

If you honestly believe that absolutely no social programs shold
exist, you're in the minority.

> > Someone rightly pointed out that the SS fund operated at  a surplus
> > until congress, in all its wisdom, decided it would be a good idea to
> > borrow the money from the fund.  This is just like paying off your
> > credit card debt with other credit cards...
> 
> Well, to expect the fox to keep the chickens and not eat them is a
> fool's dream.

Indeed; but we elect officials with some idea that they will look out
for the best interest of the population in mind.  Many people naively
believe this, even if you and I don't.  You'll be hard-pressed to
convince many of them otherwise.

> SS is *not* an insurance; it is a welfare state program. In a real
> insurance, one has the *choice* on whether or not to participate. 

In Massachusetts, and many other states, you are required to have
automobile insurance if you own a car.  I have to disagree with you.
SS is just like mandatory insurance.  

> If there were individual choice in whether or not to participate, do you
> think the powercrats would be able to get away with raiding the SS
> coffers? People would simply stop participating and choose something
> better!!!!!!!!

No they wouldn't, because they don't have a clue what's better.  And
no, I don't believe for a second they'd learn if they had no choice.
They never had before; that was the whole reason SS and welfare
programs were created in the first place.  You seem to have lost sight
of that. 

Incidentally, the need for these kinds of programs seems to be tied to
modernization.  For example, in recent years South Korea has
instituted its own mandatory retirement programs.  The reasons are the
same; as younger citizens run off to find work in the city, and as few
elderly people can do many jobs of modern society, many people were
starving to death, and there is no one at home to care for older or
infirm family members.  The citizens cried out for something to be
done.

However, income taxes in SK are still amazingly low, at a paltry 3% or
so.

> I hate being harsh here, but it is simply wishful thinking to assume
> it is possible for the fox to not eat the chickens it holds captive.
> If the chickens were free, fewer would be eaten by the fox.

But a lot more people would starve, for lack of ability to catch
chickens...

If we look at this situation without emotion, it is easy to say that
this is for the best.  It weeds out those unfit to participate in
society, and reduces pollution and the burden on our limited natural
resource pool.

But with no heart, our leaders might just as easily decide that the
world would be a lot better off if they reduced the population by
about 80% (it absolutely would), and killed us off with some
well-engineered or well-deployed bio weapon.  Fortunately, people do
have heart, at least most of us...

> > I had a really long, cynical, and dpressing answer for this, but I
> > decided to spare you.  ;-)  In short, I think Marx was right; in the
> > long run, capitalism robs the working people of their value in order
> > to reassign it to the capitalist.
> 
> I would have to disagree with that. Working people are free to
> participate in capitalism. They too can benefit just like the rest of
> us, and I've actually seen it.

Sure, but if it were easy, we'd all be rich, and no one would be
having this conversation.  

> > I'm not trying to be the poster boy for communism, here...  As an
> > ideal, people working together to ensure the common good of all is
> > hard to beat; only in practice it suffers far worse than capitalism
> > from the greed and corruption of individuals.  Until we find a way to
> > stifle those urges in people, communism can't work.
> 
> And just how do you "stifle these urges" in people? Drug them? Feed them
> propaganda? Use gunpoint? Put their first born in escrow?

As I said, the way to do it remains undiscovered.  But I do have hope
that we will someday achieve such enlightenment, though I'm reasonably
sure I'll never see it in my lifetime.

> You need a system that works well with human nature *as it is*, now what

Indeed.  And your plan of making everyone do their own retirement
planning has already failed big time.  

> > If a behavior is bad for a population, then its practice amongst the
> > population is detrimental to the population.  Period.  Only the scale
> > is flexible.
> 
> Your "Period." statement would seem to indicate, on your part, an
> unwillingness to acknowledge that there is more to this than meets the
> eye. 

No, it doesn't.  I never said no one should eat meat, nor did I
suggest that everyone should follow the same diet.  I do think that
everyone should eat as healthy as possible, and should be *encouraged*
(but not *forced*) to do so.  Campainging for such ideas as "fat is
beautiful" goes very obviously in the opposite direction, and in my
opinion are practically and morally wrong.  

> maybe that would be true in the abstract. But we are *individuals*; we
> are not stamped out of a mold. Even our metabolisms differ. 

This is all true, but does nothing to address the fact that large
percentages of people eat large quantities of foods that they KNOW
will kill them, eventually.  Promoting the idea that "fat is
beautiful", or more accurately undermining the idea that you should
try to live a more healthy lifestyle, only serve to worsen the
problem.

[I acknowledge the fact that many people treat overweight people as
pariah, and assert that this is also wrong.]

> > Now, don't get me wrong...  I'm not suggesting that we should all
> > become vegetarians and kill all the fat people,
> 
> !!!!

I have been accused in the past of having similarly extreme views...
But in general is is not the case.  Nearly always my more extreme
examples are meant to make a point, rather than reflect my own
viewpoints, which are generally more moderate.  And the smiley was
missing...  ;-)

> >  But as a society, we should be nudging people in healthy
> > directions (for themselves and for society), NOT justifying our vices.
> 
> People have to nudge themselves. You can lead a man to knowledge, but
> you can't make them think.

I'm sorry, but that's so completely wrong.  People can easily be made
to think almost whatever you want them to.  Most people are sheep, for
better or worse.  That's the main reason the Libertarians will never
get anywhere.  Most people simply aren't independent enough for that
kind of society to work.

> > Government should have a hand in this -- this is among the best
> > reasons to have "leaders" rather than true representatives. And in
> > this regard, our government has failed miserably.
> 
> Actually, it is Government's hand in this that is a large part of the
> problem. It allows itself to be lobbied by all the special interests in
> the food industry so that it enacts policies and so forth to favor
> *their profits*, not our health concerns.

That's a side issue --  I'm talking idealism, and you're talking
reality.  I think we should be striving to make society more like
idealism, and less like reality.

> Politicians are controlled by money, not by votes. Elections in our
> country are largely popularity contests. Corporations will fund both
> parties just to make sure it has a foot in the door *no matter who
> wins*. 

I'm getting that happy feeling again... ;-)

This is the main reason I don't bother to vote for my elected
official.  It doesn't matter very much, really.  The people with the
money get their way in the end anyway, regardless of who's running the
show.

> > Another great way the government should lead the people is by
> > requiring the use of open-source computer code to run all critical and
> > security-sensitive systems, and encouraging its use elsewhere.  Oh my,
> > an on-topic comment.  What has come over me?  ;-)
> 
> There should NEVER be a *requirement* by the government to use open-
> source! That would threaten the free and open nature of open-source
> software. Various agencies should just freely elect to use it as they
> see it as solutions to their needs. If you centralize the use of open-
> source software in the government, you are begging for trouble big time.

I think you misunderstood what I meant.  I simply meant that ALL
software which is used by government should have its code available to
the public for scrutiny.

> > But the sad fact is that our government isn't interested in doing
> > what's right; it's only interested in what keeps rich people rich,
> > up to the point where public outcry is insufficiently great to
> > distract them from that goal...
> 
> You and I differ sharply on what is "right" for our neighborhood
> "friendly" government to do.

W/regard to SS, it would seem.  But your solution is not workable, and
has already proven itself a failure.  The SS system we have is only
broken because the politicians are asses.  There's nothing inherently
wrong with it -- meaning, it would fulfil its purpose aptly were it
not for the interference of the asses.  I will not address ideas
related to individual investors being able to get a better return on
their money, because that isn't why it exists, nor should it, nor
could it.

> > In large part, of course, you're buying health care for elderly and
> > unusually sick people, in exchange for the promise to have it paid for
> > when you're elderly or unusually sick.  But mostly, you're paying to
> > line the pockets of the insurance people.
> 
> Well, here's a thorny issue for you -- healthcare of the elderly. I
> don't think any other nation on this planet spends as much money per
> capita on its elderly. 
> 
> Does it extends the life of the elderly? Not much. 

Then can you explain why the average life expectancy keeps going up?

> Is it really worth spending tens of thousands of dollars just to
> live a few extra weeks?

It does more than that though.  Probably much more substantially, it
improves the quality of their lives.  Of course, in general, living a
healthier lifestyle would do a lot more in that regard...  But that's
neither here nor there.

> > > The idea is to build cash flow, thus you do not deplete your savings
> > > over time, but build them up. How to do this is an exercise for the
> > > student. :-)
> > 
> > Right, an exercise that the vast majority of students aren't up for.
> 
> And why not?

I've already given lots of reasons, and there are plenty more that I
didn't mention.

> Sounds like more excuses than anything else. Even a young person who
> flips burgers for a living could put away *some* of the money. Perhaps
> it means one less night out on the town, or one less pack of cigarettes.

Or one less meal for them and their 12 siblings.  Or one less medical
treatment for their sick parent.  Or...

Life generally isn't that simple.  If it happens to be for you, you
should consider yourself fortunate.

> Will it? How so? Seems to me the country is pretty bad off as it is.

Ask your (grand)parents, or their friends who lived through the great
depression.  I've zero doubt they'll tell you things are a lot better
now.  Unless they happened to be rich...

-- 
Derek D. Martin    http://www.pizzashack.org/   GPG Key ID: 0xDFBEAD02
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