Expenses + inflation has been outpacing income increases for many years now.
The ruling class seems oblivious to the sociopolitical implications of the imbalance. The 2016 election should have been an epiphany moment. Instead they pushed their heads deeper into the sand, and ratcheted up the rhetoric and distractions.
The 2016 election gave a slug of cash and tax breaks to the investor class, voted in by a huge cadre of people probably living check to check. Given that, why should it have been an epiphany? Until people vote in their legitimate best interest, nothing will change.
> Until people vote in their legitimate best interest, nothing will change
Best interest here means best economic interests. About 25% of Republicans earn less than $30K/yr, another 25% earn less than $50K, another 25% earn less than $100K/yr, and another 23% of Republicans earn less than $300K/yr. This means 98% of Republicans have absolutely no idea what they're doing and are voting themselves into economic stagnation. The 2% of Republicans earning more than $300K/yr are quite shrewd, but at moral cost. The Republican Party is made up nearly entirely of the bamboozled, yet while they will never see economic opportunity while Republicans hold power, they are paying for the 2% to make inroads on the 0.01%.
Lovely straw man. Out of curiously, just what exactly are you talking about? Why do you think a baseline is needed? Because I have no earthly idea what you mean by "baseline" in the context of what percentages of Republicans earn.
Corporate tax breaks, like those in Trump's tax cuts, are complicated in terms of their effect on the economy. There's a reason why even countries with robust social democratic parties like Germany and Sweden have low corporate taxes. At least in theory corporate tax cuts drive business activity and lowers unemployment, which happened during Trump's presidency. Meanwhile, Trump also took aim at the "investor class" by capping SALT deductions, which hurt rich people in the orbit of Wall Street and Silicon Valley.
As a practical matter, moreover, tax cuts are something Republicans can do with only 51 Senate votes, because the budget is an exception to the filibuster's 60 vote requirement. Query what would have happened if we eliminated the filibuster and the GOP had more room to give their voters what they want.
Corporate taxes just come from the customers of the corporations. It may be more palatable but it’s just VAT with extra steps.
The SALT change and the deductible increase affected large swaths of taxpayers favorably-mostly the working poor who made enough to pay taxes but not enough for much deductions.
There's that, but also people are now turning down free, potentially lifesaving vaccines as an expression of their political identity. Dying on a ventilator to spite your perceived political enemies is not sending a very strong message of disapproval to the elite.
I believe that when it comes to voting, those who do vote do the best they can. What's broken is the two party cartel system. Getting two choices, both of which are often second rate isn't the voters' fault.
Put another way, if you don't have anyone worth voting for you're not going to vote. Voter turnout is very low. What does that tell us? Oddly enough, there's no one responsible and accountable for voter turnout. Funny how that is.
They’re not oblivious, they just don’t care. They’re in extraction mode in the US, the money is going to be reallocated to higher growth regions like China, India and Africa.
What point? That America runs a trade deficit with China? That isn’t news.
Have you looked at our trade relationship with Japan? Germany? It’s been negative by tens of billions for decades. No one claims they are depleting America of money.
Trade deficits aren’t a zero sum game. Countries end up putting those earnings back in American securities, burning that money on useless investments (particularly relevant to China right now) and many of the inputs/outputs (like services which America excels at) aren’t ever properly recorded.
It's hard to vote with your money when you barely have enough to keep a roof over your head and food on your table.
And what I do with my money is meaningless unless I coordinate with millions of other people to do the same thing. And the probability of that happening is extremely low.
You misunderstand. Vote when thinking of your pocketbook. Not how you spend. Can’t outspend the investor class. Cut off their oxygen by restaffing government.
Same principle - my vote is a drop in the sea. Unless I agree and coordinate with everyone else on how to vote, it's meaningless. And the probability of that happening is extremely low.
I admire the optimism, but I just don't feel it's realistic. There is absolutely nothing an individual, on their own, can do to change anything in the current world.
Correct. As long as the investors lead the sheep they’ll get sheared. It will take a groundswell that is positive rather than what is common worldwide right now.
How many Americans (or Brits as I am a brit) do this because they only earn just enough for essentials, and how many because they choose to piss away their generous incomes rather than save so much as a penny?
A lot of Americans don't seem to have any self-discipline when it comes to consumerism, and they're all carrying credit cards. Once you're underwater on thousands of dollars in credit card debt, while still addicted to consuming unnecessary junk for your overall happiness, it's like a real-life version of OOM thrashing.
I’ve always thought there’s a tipping point of fault when such a large amount of people have a problem. Small % of folks with the issue? Maybe a personal responsibility thing. Half the population can’t come up with $1000? Large amount of credit card users carrying a balance? Large swaths of people over consuming? There’s something else at work here and I struggle to point to the individual as the source of the problem.
It all seems like predictable outcomes of capitalism run amuck.
At least it's not illegal yet to live without credit cards and/or lead a frugal life.
But it is arguably part of the problem IMO that credit scores have become so necessary it's difficult if not impossible to find an apartment without one. That alone is a forcing function pushing young Americans to rely on credit, greasing those consumer wheels by decoupling their spending from their earning at a young age.
My employer keeps track of my credit worthiness. People have been fired by my employer for having bad credit because they present a risk to the company. I cannot keep my employment without maintaining good credit. Maintaining good credit cannot be done without taking on debt.
You don't actually need the debt balance, you just need the payment history. I had zero debt in the decade between paying off my student loans and taking on a mortgage. Credit score ~820 at that point. I had credit cards but auto-paid them in full every month and never carried a balance. It's the payment history that your score cares about, not the balance. You actually end up with a lower score if you have a higher balance.
> . That alone is a forcing function pushing young Americans to rely on credit, greasing those consumer wheels by decoupling their spending from their earning at a young age.
I'm Canadian and lived in the US for several years and can attest this is a strange system.
Here (Canada) credit scores are starting to become more and more common but this is a new thing, and probably something we 'borrowed' from the US.
When i moved to the US I had a credit score of zero and a really good income. I had problems finding a place to live as everyone asked for my credit score.
I finally bought a car and took out a loan which i paid off a few months later simply to attempt to build a "credit score" and make my life easier.
Things may be different now, but I dont recall ever being asked for a "credit score" when attempting to rent in Toronto many years ago.
why do you feel this indicates anything behind what it is, "Keeping up with the joneses".
Large swaths of people do strange things with their money on a regular basis :
- State Lotto tickets
- people visiting casinos
Individuals are not the "source" of the problems, group think, media, etc encourage it. Just because my neighbour has a new car doest mean i need one too?
Back to the core point, the US does have a bias towards overconsumption. During the financial crisis Stimulus packages were issued to "encourage spending"
A stimulus check is a direct payment made by the government to its citizens. Unlike tax credits, which come as deductions from taxes owed during tax filing, stimulus checks are designed to give immediate relief to taxpayers and encourage stability and spending during an economic downturn.
What happens if everyone stops playing state lottos, and engaging in vices like drinking, smoking or doing drugs?
Take it to the logical extreme.
I’ll help.
Virtually every state experiences massive budget shortfalls overnight.
Police departments become critically underfunded.
Schools become insolvent.
Pensions go underwater.
Massive unemployment occurs do too bars, detox centers, etc closing.
This unemployment cascades as the supporting industries and businesses experience severe austerity.
I can continue but I trust that I’ve painted a grim picture of what will happen if rampant consumerism stops. The only way America can function without drastic change to the fundamental assumptions used by economists is by correcting people to engage in financially destructive or illegal behavior.
>But if, on the other hand, you come to the conclusion, as is too often the case, that it is a good thing to break shop windows, that it causes money to circulate, and that the encouragement of industry in general will be the result of it, you will oblige me to call out, "Stop there! Your theory is confined to that which is seen; it takes no account of that which is not seen."
>It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way, which this accident has prevented.
Have you considered what the money would be used for if not spent in doing drugs and gambling? It is true that rehab centres and some police stations might no longer be needed, but perhaps society would find a better use for that money.
The comments from this individual made me question if they understand what "logic" means.
The write:
> Take it to the logical extreme.
Then proceeds to make a number of serious illogical comments?
Killing off state lotto leads to pension defaults, bars going bankrupt, etc?
as you said, no better use of the money?
The entirely missed my point which was people do dumb things with their money on a regular basis, lotto and gambling were two examples in my opinion. Naturally people who gamble would disagree and they are entitled to their opinions.
I plainly saw your point that people do dumb things with their money, suggesting I didn’t begs the question: did you actually read and ponder on my comment? My apologies for thinking you had something else to say on the matter of consumerism which is what I was attempting to engage you in discussion about. You see my examples built off of yours but you neglected to imagine the broader world without consumerism. I should made my expectation of you more clear. Apologies. I’ll summarize the point I was making explicitly for you. Capitalism is impossible without mindless consumerism. If mindless consumerism falters for a moment markets panic and the dominoes start falling. We cannot talk about ending mindless consumerism without talking about tens of millions of unemployed Americans, contagious economic crisis spreading from market to market (thanks financialization of everything) and everywhere else unpredictably.
I hear that, but also predatory marketing does work. We have to take responsibility for our actions, but I do see times when other are also culpable for bad decisions people make.
People get mad when you say this, but it doesn't necessarily contradict the fact that American's are in a rigged game and get raw deals. On top of that they have been conditioned to have extremely low self discipline and at the end of the day, screw themselves over as much as the system screws them over.
It's not about assigning fault. But if you wanted to fix the problem, understanding the role people's own decision making factors into it would be a big part of it.
The system leads them to water but at the end of the day, they choose to drink.
Debt that you can’t quite get in front of will make you a bit nihilistic - it took moving abroad to a country where the shops had limited hours and many of them didn’t take credit cards to help me reform. Oh, and dating (then marrying) a guy who was raised with a particularly strong version of that culture’s aversion to consumer debt (he couldn’t fathom borrowing money to buy a car).
I speak of Germany, circa 20 years ago. Unfortunately, consumer credit of all sorts has become a lot more available and accepted here, and I’m worried for a lot of the people around me for when the looming global recession really gets going, and we see the full impact of Putin wrecking the energy order Germany had allowed itself to be lulled into - those higher energy bills won’t start showing up for a lot of folks before next year.
But not my husband’s family, or us - we live small, in a culture that still doesn’t pressure us to live as large as US culture, especially my Texan culture, does people in our general walk of life.
If you are ever interested in getting serious about budgeting I can highly recommend YNAB [0] ("You need a Budget). It's a more advanced "envelope" system and it completely changed my relationship with money. I went from effectively living paycheck-to-paycheck (aside from hiding away some funds then blowing them randomly, no emergency fund) to now having 6 months into the future fully funded (aka I could lose all my income sources and be able to maintain my lifestyle for a minimum of 6 months without any extra cuts, of which I would make some if that happened), no debt save for my house and a tiny bit of student loans I'm waiting on, and maxing my 401k contributions.
I tried YNAB three different times before it finally clicked for me and I can attribute a lot my success to Nick True's videos (specifically his "YNAB for beginners" [1] video) and a friend giving me a push at just the right moment. Let this comment be your personal wakeup call to get your finances under control and remove the background (often subconscious) stress that worrying about money causes.
[1] https://www.youtube.com/watch?v=exS0gU-Ie8E (NOTE: This is the updated 2022 version, I've only seen his original version but I assume this is the best one to watch now)
63 comments
[ 3.6 ms ] story [ 115 ms ] threadThe ruling class seems oblivious to the sociopolitical implications of the imbalance. The 2016 election should have been an epiphany moment. Instead they pushed their heads deeper into the sand, and ratcheted up the rhetoric and distractions.
This isn't sustainable.
In fact as much as I hate Trump he was change: the first evidence of the old elite losing control.
Best interest here means best economic interests. About 25% of Republicans earn less than $30K/yr, another 25% earn less than $50K, another 25% earn less than $100K/yr, and another 23% of Republicans earn less than $300K/yr. This means 98% of Republicans have absolutely no idea what they're doing and are voting themselves into economic stagnation. The 2% of Republicans earning more than $300K/yr are quite shrewd, but at moral cost. The Republican Party is made up nearly entirely of the bamboozled, yet while they will never see economic opportunity while Republicans hold power, they are paying for the 2% to make inroads on the 0.01%.
[1] https://www.pewresearch.org/religion/religious-landscape-stu...
As a practical matter, moreover, tax cuts are something Republicans can do with only 51 Senate votes, because the budget is an exception to the filibuster's 60 vote requirement. Query what would have happened if we eliminated the filibuster and the GOP had more room to give their voters what they want.
The SALT change and the deductible increase affected large swaths of taxpayers favorably-mostly the working poor who made enough to pay taxes but not enough for much deductions.
Put another way, if you don't have anyone worth voting for you're not going to vote. Voter turnout is very low. What does that tell us? Oddly enough, there's no one responsible and accountable for voter turnout. Funny how that is.
https://www.economist.com/graphic-detail/2022/09/29/a-study-...
(And that isn’t even considering the sharp drop in population growth China is about to experience)
Plus the GDP (per capita and otherwise) in Africa and India lead me to believe there really isn’t much money being reallocated to them.
- The U.S. goods trade deficit with China was $310.3 billion in 2020
- The U.S. goods trade deficit with China was $355.3 billion in 2021
I think their choice of "growth" was bad, but their point of "sucking up money" was spot on.
It is not an accident that China maintains a surplus, they are intentionally extracting money from them.
Have you looked at our trade relationship with Japan? Germany? It’s been negative by tens of billions for decades. No one claims they are depleting America of money.
Trade deficits aren’t a zero sum game. Countries end up putting those earnings back in American securities, burning that money on useless investments (particularly relevant to China right now) and many of the inputs/outputs (like services which America excels at) aren’t ever properly recorded.
Worth-less to that buyer from Wichita, but worth-more than Renminbi to that seller from Guangzhou.
But slurping up the middle East’s oilshake whilst sitting on our giant reserves is a good trick whilst it works.
And what I do with my money is meaningless unless I coordinate with millions of other people to do the same thing. And the probability of that happening is extremely low.
I admire the optimism, but I just don't feel it's realistic. There is absolutely nothing an individual, on their own, can do to change anything in the current world.
https://www.bea.gov/data/income-saving/personal-saving-rate
At least it's not illegal yet to live without credit cards and/or lead a frugal life.
But it is arguably part of the problem IMO that credit scores have become so necessary it's difficult if not impossible to find an apartment without one. That alone is a forcing function pushing young Americans to rely on credit, greasing those consumer wheels by decoupling their spending from their earning at a young age.
I'm Canadian and lived in the US for several years and can attest this is a strange system.
Here (Canada) credit scores are starting to become more and more common but this is a new thing, and probably something we 'borrowed' from the US.
When i moved to the US I had a credit score of zero and a really good income. I had problems finding a place to live as everyone asked for my credit score.
I finally bought a car and took out a loan which i paid off a few months later simply to attempt to build a "credit score" and make my life easier.
Things may be different now, but I dont recall ever being asked for a "credit score" when attempting to rent in Toronto many years ago.
why do you feel this indicates anything behind what it is, "Keeping up with the joneses".
Large swaths of people do strange things with their money on a regular basis :
- State Lotto tickets
- people visiting casinos
Individuals are not the "source" of the problems, group think, media, etc encourage it. Just because my neighbour has a new car doest mean i need one too?
Back to the core point, the US does have a bias towards overconsumption. During the financial crisis Stimulus packages were issued to "encourage spending"
https://www.thebalancemoney.com/stimulus-checks-3305750
DEFINITION
A stimulus check is a direct payment made by the government to its citizens. Unlike tax credits, which come as deductions from taxes owed during tax filing, stimulus checks are designed to give immediate relief to taxpayers and encourage stability and spending during an economic downturn.
What happens if everyone stops playing state lottos, and engaging in vices like drinking, smoking or doing drugs?
Take it to the logical extreme.
I’ll help.
Virtually every state experiences massive budget shortfalls overnight.
Police departments become critically underfunded.
Schools become insolvent.
Pensions go underwater.
Massive unemployment occurs do too bars, detox centers, etc closing.
This unemployment cascades as the supporting industries and businesses experience severe austerity.
I can continue but I trust that I’ve painted a grim picture of what will happen if rampant consumerism stops. The only way America can function without drastic change to the fundamental assumptions used by economists is by correcting people to engage in financially destructive or illegal behavior.
That is a pointless exercise.
If state lotto ticket sales dried up they would most likely raise taxes.. but let your crazy theory run wild and end with "pensions go underwater".
Thank goodness we have state lotto??
>It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way, which this accident has prevented.
Have you considered what the money would be used for if not spent in doing drugs and gambling? It is true that rehab centres and some police stations might no longer be needed, but perhaps society would find a better use for that money.
The write:
> Take it to the logical extreme.
Then proceeds to make a number of serious illogical comments?
Killing off state lotto leads to pension defaults, bars going bankrupt, etc?
as you said, no better use of the money?
The entirely missed my point which was people do dumb things with their money on a regular basis, lotto and gambling were two examples in my opinion. Naturally people who gamble would disagree and they are entitled to their opinions.
It's not about assigning fault. But if you wanted to fix the problem, understanding the role people's own decision making factors into it would be a big part of it.
The system leads them to water but at the end of the day, they choose to drink.
And if the end result isn’t healthy for society then perhaps society has to step in.
I speak of Germany, circa 20 years ago. Unfortunately, consumer credit of all sorts has become a lot more available and accepted here, and I’m worried for a lot of the people around me for when the looming global recession really gets going, and we see the full impact of Putin wrecking the energy order Germany had allowed itself to be lulled into - those higher energy bills won’t start showing up for a lot of folks before next year.
But not my husband’s family, or us - we live small, in a culture that still doesn’t pressure us to live as large as US culture, especially my Texan culture, does people in our general walk of life.
And when it’s easy to get people who would be better off not getting it will get it.
The only solution may be to make bankruptcy even easier until the banks stop being dumb.
It's not possible to succeed without one, so they fail.
There's not much more to it. People who prioritise other things above essentials fail in every endeavour. Wealth, health, happiness.
I tried YNAB three different times before it finally clicked for me and I can attribute a lot my success to Nick True's videos (specifically his "YNAB for beginners" [1] video) and a friend giving me a push at just the right moment. Let this comment be your personal wakeup call to get your finances under control and remove the background (often subconscious) stress that worrying about money causes.
[0] https://www.youneedabudget.com/
[1] https://www.youtube.com/watch?v=exS0gU-Ie8E (NOTE: This is the updated 2022 version, I've only seen his original version but I assume this is the best one to watch now)