No Mr. Romney, Rich People Do Not Create Jobs

Last weekend I decided to keep an open mind and do some non-partisan research. I wanted to know what "Reganomics" was about. I wanted to hear the pros and cons of a "trickle down ecomony". I wished to understand "Supply Side Economics".

It wasn't an easy feat. There are lots of numbers from a lot of varying sources.

My conclusion after 6 hours of intense study of both Democratic and Republican spin sites is:

No, trickle down/supply side/Reganomics doesn't work.

I have found an excellent article that articulates the point quite nicely:

In our current "class war" climate, this argument has been repeated so often that it's now regarded as fact. And it is frequently and passionately invoked to defend the idea that we should make further tax cuts for rich people — so rich people can have an incentive to create more jobs...

Business Insider Article

Here's a good video on the way trickle down actually works in the real world, and offers a sollution to how it *could* be fixed to actually work:



The problem is, the wealthy already have lots of money to invest in new companies. Why aren't they doing it? Demand. Their own customers can't afford the products they are selling, so why hire more people?

If I owned 20 McDonald's, and made over a million a year I could probably afford to build a new one and hire some people. However, if I find that overal revenue from my 20 McDonald's is down, what incentive to I have to build and expand?

We've seen a gradual shift from the middle class to the rich in terms of income over the past 30 years. This has stifled our abilty to create demand, and thereby create jobs.

Thoughts?

If the rich are the job creators then I guess they are the ones to blame for the high unemployment rate?
They can`t take credit for being job creators when things are good without also taking the blame for high unemployment when things are bad.

When times are bad they blame the government but when times are good they try to take credit for being the job creators, they aren`t fooling me.

I tried my hardest to track down any and all pro GOP/Republican studies and watch as many videos as I could -- they simply don't offer as much solid, concrete evidence that their method of economics works.

If the bulk of the consumers in this country have more money to spend, demand on products/services will go up. It's quite basic.

I've heard that Reganomics was a success in the 80's. Looking back at the numbers since then we can clearly see that in the short term it worked, however, in the long term we ended up with drastic increases in government spending that we are STILL paying off to this day.

Thanks Mom and Dad for voting for Regan right as I was born.

reply to post by MystikMushroom


They are job creators, but they create them in other countries at an increasing rate. I don't really know what can be done. We definitely have a wealthy, elite ruling class/oligarchy. Although, they don't ever really talk about it on mainstream media. Sure, there's the 1% and the OWS movement and stories, but I don't think any controlled news outlet is going to tell people that the same interconnected, multi-generational families (and their businesses which are exporting jobs) are the culprit or a large part of the problem behind many of these employment issues.
They certainly won't break down the any of the illusions we hold dear.. especially the illusion of choice at election time. The Owners do what they want.

reply to post by MystikMushroom

If I owned 20 McDonald's, and made over a million a year I could probably afford to build a new one and hire some people. However, if I find that overal revenue from my 20 McDonald's is down, what incentive to I have to build and expand?

Precisely. Why risk additional money (your own or bank) if the current revenues are down. At the same time, you should also ask 'WHY' is the revenue down? Bad Employees, Customer Service, Bad Food, Changing Times in eating habit? etc etc. After all they're in Business and not Charity work.

reply to post by MystikMushroom


Lol. Bullseye. The economic system is just a pyramid scheme because wealth is allowed to pass from one generation to another even if the people who have the wealth is not creating anything but just managing what they have. I would love people who where successful and created their buisness from scratch and became wealthy based on what they create during their life (if they uphold moral values also) but have no affection at all for the spoiled people supposed to be better wealthy people that are born with a silver spoon. The economic system have become a slave system where you cannot get resonable pay and have to take loan to have a normal life even if you study in collage and is very productive during buisness hours.

reply to post by MystikMushroom


Good video

It's especially nice to see the term Working Class not the mythic Middle Class that we are all told we are.

I've been seeing far to many threads/topics created recently about "my guy vs. your guy".

Lets have a discussion about the core issues themselves, not the absurd statements made in debates!

The economy for most people is the number one issue, and the tax/economic plans of both candidates need to be examined!

I suppose a question I have for the community would be: how can we fix this situation?

I suppose having a stronger middle class is a simple answer. How can we achieve this? Simply throwing money at the wealthy has been proven not to stimulate long term jobs. The article I linked to in my OP used Silicon Valley as an example of non-sustainable growth.

What other options should our country consider?

Why do people feel entitled to anything they didn't earn?

Many "wealthy" people started out working long hours with great risk to their financial security for years.

If the wealthy don't create jobs, I'm guessing that the answer would be government, yes?

If that's the case, then embrace big government. I, for one, will be working to make government accountable AND SMALLER.

Personal responsibility. Embrace it.

reply to post by apushforenlightment


This is another issue that I've been pondering. When people don't have the available monies to spend on goods, demand goes down. People don't like having their quality of life messed with, so as wages go down people begin to rely on credit.

We all know what happend with the credit bubble. For a whille, war was proping up our economy. Then, as that slowed down, easy credit became available as a "band aid". It worked, for a time. Now we are worse off than before.

Originally posted by beezzer
Why do people feel entitled to anything they didn't earn?

Many "wealthy" people started out working long hours with great risk to their financial security for years.

If the wealthy don't create jobs, I'm guessing that the answer would be government, yes?

If that's the case, then embrace big government. I, for one, will be working to make government accountable AND SMALLER.

Personal responsibility. Embrace it.

You bring up good points, however -- many companies that are very large and very wealthy were *not* created from scratch in this generation. Most of these large corporations are no longer owned by a single individual.

Ford, CocaCola and others are what I call "dynastic" companies. These companies account for the largest chunk of the GDP.

The government shouldn't directly create jobs. In other words, hiring more tax code people for the IRS. What they CAN do is pump more money into the middle/lower classes to enable those people to spend more money. This in turn would create greater revenues and encourage growth and job creation.

I don't think you fully gasp the concept here?

Originally posted by MystikMushroom


You bring up good points, however -- many companies that are very large and very wealthy were *not* created from scratch in this generation. Most of these large corporations are no longer owned by a single individual.

Ford, CocaCola and others are what I call "dynastic" companies. These companies account for the largest chunk of the GDP.

Who cares? Really. Who cares? What people make is their own business. Not yours. Not mine. This speaks more of class warfare than anything else.

The government shouldn't directly create jobs. In other words, hiring more tax code people for the IRS. What they CAN do is pump more money into the middle/lower classes to enable those people to spend more money. This in turn would create greater revenues and encourage growth and job creation.

I don't think you fully gasp the concept here?

So you want wealth redistribution. You want to punish success and reward people who have done nothing to earn it.

I fully grasp your concept, sir. I just disagree with it.

When I read this article, this jumped out at me:

David Stockman, who was Ronald Reagan's budget director and economic guru, says Ryanomics is a "fairy tale." Stockman was one of the architects of "supply side" economics (aka trickle-down). Today he states unequivocally that trickle-down doesn't work.

LINK

I mean, if the guy that invented "trickle down" economics itself now claims it's a fairy tale, and it's exactly what Romney/Ryan want to do...

I'm really not sure that Obama's plan is really any better, at least not in the immediate future. Turning a ship as large as the USA around takes tremendous effort and time. This is something the American people don't want. Hey, I want a quick fix too -- but I don't see one coming from either side.

They call it trickle down economics because it means that the rich are pissing on everyone else.

reply to post by beezzer


Well, according to you we'd all pretty much live in mud huts while the rich (who pass on their wealth) sit atop the mountain in a castle, getting richer. We are all in this together, and the wealthy have been shifting the money from the middle/lower classes to the rich for years.

I suppose you'll claim "so what, it's their right".

This HURTS the rich in the end. If they horde their money, invest it overseas -- they destroy their consumer base.

Good luck working your way up from the bottom when you have nothing. Having two hands and a strong work ethic doesn't cut it anymore. An education helps, but when you can never pay off your student loan -- why bother?

It's a spiraling problem that is spinning faster and faster.

And yes, there is an element of class warfare here. Happy balances must be maintained for social and economic stability.

Yes the rich CEO's at companies such as Apple are creating SO many jobs...in China.

reply to post by beezzer

So you want wealth redistribution. You want to punish success and reward people who have done nothing to earn it.

Nope that is not what I am getting from the OP. He is saying that when people work all week and the pay packet they receive on a Friday runs out by Monday it is not good for the individual, their families or the country

I fully grasp your concept, sir. I just disagree with it.

What I am getting from you is not that you disagree with the OP it is more like you are dismissing the points he makes which is quite different

Originally posted by MystikMushroom
reply to post by beezzer

 

Well, according to you we'd all pretty much live in mud huts while the rich (who pass on their wealth) sit atop the mountain in a castle, getting richer. We are all in this together, and the wealthy have been shifting the money from the middle/lower classes to the rich for years.

Playing the "victim" card. If we're in this together, then everyone should be shouldering the tax burden, not just those with more money.

I suppose you'll claim "so what, it's their right".

YUP! Free country and all that.

This HURTS the rich in the end. If they horde their money, invest it overseas -- they destroy their consumer base.

Justifying stealing from the wealthy hurts them.

Good luck working your way up from the bottom when you have nothing. Having two hands and a strong work ethic doesn't cut it anymore. An education helps, but when you can never pay off your student loan -- why bother?

It's a spiraling problem that is spinning faster and faster.

And yes, there is an element of class warfare here. Happy balances must be maintained for social and economic stability.

I'm doing just fine, thank you. Hopefully someday soon I will be one of the wealthy you despise.

With all due respect, of course.

Originally posted by colin42
reply to post by beezzer

 

So you want wealth redistribution. You want to punish success and reward people who have done nothing to earn it.

Nope that is not what I am getting from the OP. He is saying that when people work all week and the pay packet they receive on a Friday runs out by Monday it is not good for the individual, their families or the country

I fully grasp your concept, sir. I just disagree with it.

What I am getting from you is not that you disagree with the OP it is more like you are dismissing the points he makes which is quite different

I disagree with the entire premise.

Hating the rich, demanding from the rich with which you haven't earned. It's an entitlement mentlity.

Not ONCE did I see/read anything about personal responsibility, taking responsibility for your own actions, your own future.

I stand by my posts.

Nope...the Rich DO NOT create jobs. Consumers create jobs. If you have consumers, you have demand, if you have demand, you need to hire more people...simple crap really.

The problem is...when corporations ship jobs overseas to save a buck, they reduce the capacity of the "consumers" to buy their products...so yes, it is a slow and devious cycle. The fewer people that are working or have disposable income...the less product you are going to sell. This however, does not have any effect on the wealthy corporations and business owners. Their client/customer base just moves along with the jobs. They are "global"...the rest of us are national. Most people don't have the luxury of working "abroad" for multi-national corporations.

This was planned...there are those with a LOT of money that want to return to the days of feudalism...they own the land and all the "stuff" and you can work for them for 3 sqaures a day and a roof over your head...some will not agree, but Mr. Romney and his cronies are right in the mix of the wealth powered takeover of this country.

Obama on the other hand seems to want everyone to suffer equally...are you getting the jist if it here? Neither of these clowns are going to help the average citizen.

But man...point that out to either side and you get some harshness...they either cry and act like



or they get belligerant and try to defend that which cannot be justified and give you a



I enjoy watching the real hardcore ones...they just cannot pass up a thread where their "hero" is being questioned or criticized...they are actually quite funny...in a pitiful and pathetic kind of way....