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Social Programs and Death

Kleptin
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9/14/2011 6:06:12 PM
Posted: 5 years ago
Some unorganized thoughts popped into my head today stemming from an argument I was having with someone about social programs and taxes:

Resources are limited because the population of those who contribute more than they take is starting to be strained by the population of people who take more than they contribute.

People dependent on social programs to survive tend not to thrive and these people perpetuate the chain by reproducing. Removing social programs would lead to the deaths of people dependent on them as well as their own reproduction.

The lives of these people were made possible through social programs to begin with. Can we ignore the moral issues with ending social programs since in the big picture, all we're doing is correcting something to begin with? If social programs made it possible to expand our population with extra unproductive members, is it really immoral to shrink it back to its natural state by taking social programs away?
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Ore_Ele
Posts: 25,980
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9/14/2011 6:24:52 PM
Posted: 5 years ago
depends on what your morals are.

No one (very very few) is naturally going to take more than they produce, since people are not stagnant by definition. A person who currently takes out more than they put in can be changed and improved.

Since nearly every single child takes away more than they put in, at least for the first many years of life, that alone does not seem like a good argument.

You also run the risk of revolution. Since it is ingrained into people's minds that government is "for the people," should the government turn its back to people (a large portion of people), they are going to fight back to maintain their representation.

Of course doing that is also going to see major contractions in the economy. Since many industries provide goods to those people, removing them removes some demand, and so those companies will shrink (and lay people off). Now, before Mongeese (or goose, can't remember) comes up with a "broken window" claim, saying that the companies would pay less taxes so they'd have more money to invest, let me explain why it would still happen.

Let's say we have a coca cola company. A lot of the poor people (those that take more than they produce) drink cola. Let's just say that 25% of the company's demand comes from those poor people (the number does not alter the general principle). If those poor people are cut off and left to die, the demand for that product will drop 25%, but they'll have more taxes, so they can afford to charge less.

Now, the question is, do you think that the rest of the population is going to up its cola drinking by 33% to offset that lost demand? Probably not, while some industries this might be the case, in many, it is not. So the cola company has to lay off 20% of its workers (since the lower taxes, the price can lower, and so some demand will be recouped).

This means that more people are tossed into the unemployed and they are now in the "taking more than producing" camp. However, companies know that these are productive workers, so they start investing in new companies for these people to work in (new tech, new products, whatever). The problem is, there is a major delay between when those workers are laid off and when the new factories open their doors to allow those people to get back to work. It's not like you get fired today and a new company is wiped up with a fully functioning factory for you to work in tomorrow.

This is where the social programs are suppose to come in, they help people survive that time to get from the old job, to the new one. But if they are gone, you'll find many of those people will now also starve to death.

So you've lost more than just the unproductive workers, you've lost some productive ones as well.
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dogmatic
Posts: 7
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9/14/2011 7:19:41 PM
Posted: 5 years ago
I think most would argue that retraining programs and welfare that lasts a limited time (2 years) is beneficial to society as it eases frictional unemployment and due to Okun's Law will actually be beneficial to the economy.

With that said lifetime welfare program that provide an unlimited timetable for "finding work" as well as "disability" for people to fake is a negative social program that only encourages laziness and taxes the working population.

Most people are fine with helping others get on their feet, not with carrying them on their backs. The grasshopper and the ant parable is at hand, and in my opinion the eternal grasshopper should starve.
jimtimmy
Posts: 3,953
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9/15/2011 10:20:48 AM
Posted: 5 years ago
At 9/14/2011 6:24:52 PM, Ore_Ele wrote:
depends on what your morals are.

No one (very very few) is naturally going to take more than they produce, since people are not stagnant by definition. A person who currently takes out more than they put in can be changed and improved.

Since nearly every single child takes away more than they put in, at least for the first many years of life, that alone does not seem like a good argument.

You also run the risk of revolution. Since it is ingrained into people's minds that government is "for the people," should the government turn its back to people (a large portion of people), they are going to fight back to maintain their representation.

Of course doing that is also going to see major contractions in the economy. Since many industries provide goods to those people, removing them removes some demand, and so those companies will shrink (and lay people off). Now, before Mongeese (or goose, can't remember) comes up with a "broken window" claim, saying that the companies would pay less taxes so they'd have more money to invest, let me explain why it would still happen.

Let's say we have a coca cola company. A lot of the poor people (those that take more than they produce) drink cola. Let's just say that 25% of the company's demand comes from those poor people (the number does not alter the general principle). If those poor people are cut off and left to die, the demand for that product will drop 25%, but they'll have more taxes, so they can afford to charge less.

Now, the question is, do you think that the rest of the population is going to up its cola drinking by 33% to offset that lost demand? Probably not, while some industries this might be the case, in many, it is not. So the cola company has to lay off 20% of its workers (since the lower taxes, the price can lower, and so some demand will be recouped).

This means that more people are tossed into the unemployed and they are now in the "taking more than producing" camp. However, companies know that these are productive workers, so they start investing in new companies for these people to work in (new tech, new products, whatever). The problem is, there is a major delay between when those workers are laid off and when the new factories open their doors to allow those people to get back to work. It's not like you get fired today and a new company is wiped up with a fully functioning factory for you to work in tomorrow.

This is where the social programs are suppose to come in, they help people survive that time to get from the old job, to the new one. But if they are gone, you'll find many of those people will now also starve to death.

So you've lost more than just the unproductive workers, you've lost some productive ones as well.

An interesting thing is that large social welfare states typically have the effect of lowering GDP... There could be value in programs, but they do not increase growth

You seem to be mistaking the cause and effect. Consumption does not create production, production creates consumption...

Nobody can consume what has not been produced. Consumption, you see, is only the effect of production...
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Ore_Ele
Posts: 25,980
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9/15/2011 6:19:57 PM
Posted: 5 years ago
At 9/15/2011 10:20:48 AM, jimtimmy wrote:
At 9/14/2011 6:24:52 PM, Ore_Ele wrote:
depends on what your morals are.

No one (very very few) is naturally going to take more than they produce, since people are not stagnant by definition. A person who currently takes out more than they put in can be changed and improved.

Since nearly every single child takes away more than they put in, at least for the first many years of life, that alone does not seem like a good argument.

You also run the risk of revolution. Since it is ingrained into people's minds that government is "for the people," should the government turn its back to people (a large portion of people), they are going to fight back to maintain their representation.

Of course doing that is also going to see major contractions in the economy. Since many industries provide goods to those people, removing them removes some demand, and so those companies will shrink (and lay people off). Now, before Mongeese (or goose, can't remember) comes up with a "broken window" claim, saying that the companies would pay less taxes so they'd have more money to invest, let me explain why it would still happen.

Let's say we have a coca cola company. A lot of the poor people (those that take more than they produce) drink cola. Let's just say that 25% of the company's demand comes from those poor people (the number does not alter the general principle). If those poor people are cut off and left to die, the demand for that product will drop 25%, but they'll have more taxes, so they can afford to charge less.

Now, the question is, do you think that the rest of the population is going to up its cola drinking by 33% to offset that lost demand? Probably not, while some industries this might be the case, in many, it is not. So the cola company has to lay off 20% of its workers (since the lower taxes, the price can lower, and so some demand will be recouped).

This means that more people are tossed into the unemployed and they are now in the "taking more than producing" camp. However, companies know that these are productive workers, so they start investing in new companies for these people to work in (new tech, new products, whatever). The problem is, there is a major delay between when those workers are laid off and when the new factories open their doors to allow those people to get back to work. It's not like you get fired today and a new company is wiped up with a fully functioning factory for you to work in tomorrow.

This is where the social programs are suppose to come in, they help people survive that time to get from the old job, to the new one. But if they are gone, you'll find many of those people will now also starve to death.

So you've lost more than just the unproductive workers, you've lost some productive ones as well.

An interesting thing is that large social welfare states typically have the effect of lowering GDP... There could be value in programs, but they do not increase growth

If you are in a non-welfare state that transistions into welfare, that is the case. But we are talking about being in a welfare state transistioning out of it. You will see a sudden drop in GDP, and then a market adjustment, just like you do going the other direction.


You seem to be mistaking the cause and effect. Consumption does not create production, production creates consumption...

Nobody can consume what has not been produced. Consumption, you see, is only the effect of production...

Consumption creates demand, that demand drives individuals to create production.

The idea of "if you build it they will come" is part of the disaster that led to the housing bubble. We created more than the natural demand, and now home prices have plumetted and a lot of home builders are out of a job, because they over built. Because there are all these recently new houses, no one wants brand new houses.
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jimtimmy
Posts: 3,953
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9/15/2011 8:05:21 PM
Posted: 5 years ago
At 9/15/2011 6:19:57 PM, Ore_Ele wrote:
At 9/15/2011 10:20:48 AM, jimtimmy wrote:
At 9/14/2011 6:24:52 PM, Ore_Ele wrote:
depends on what your morals are.

No one (very very few) is naturally going to take more than they produce, since people are not stagnant by definition. A person who currently takes out more than they put in can be changed and improved.

Since nearly every single child takes away more than they put in, at least for the first many years of life, that alone does not seem like a good argument.

You also run the risk of revolution. Since it is ingrained into people's minds that government is "for the people," should the government turn its back to people (a large portion of people), they are going to fight back to maintain their representation.

Of course doing that is also going to see major contractions in the economy. Since many industries provide goods to those people, removing them removes some demand, and so those companies will shrink (and lay people off). Now, before Mongeese (or goose, can't remember) comes up with a "broken window" claim, saying that the companies would pay less taxes so they'd have more money to invest, let me explain why it would still happen.

Let's say we have a coca cola company. A lot of the poor people (those that take more than they produce) drink cola. Let's just say that 25% of the company's demand comes from those poor people (the number does not alter the general principle). If those poor people are cut off and left to die, the demand for that product will drop 25%, but they'll have more taxes, so they can afford to charge less.

Now, the question is, do you think that the rest of the population is going to up its cola drinking by 33% to offset that lost demand? Probably not, while some industries this might be the case, in many, it is not. So the cola company has to lay off 20% of its workers (since the lower taxes, the price can lower, and so some demand will be recouped).

This means that more people are tossed into the unemployed and they are now in the "taking more than producing" camp. However, companies know that these are productive workers, so they start investing in new companies for these people to work in (new tech, new products, whatever). The problem is, there is a major delay between when those workers are laid off and when the new factories open their doors to allow those people to get back to work. It's not like you get fired today and a new company is wiped up with a fully functioning factory for you to work in tomorrow.

This is where the social programs are suppose to come in, they help people survive that time to get from the old job, to the new one. But if they are gone, you'll find many of those people will now also starve to death.

So you've lost more than just the unproductive workers, you've lost some productive ones as well.

An interesting thing is that large social welfare states typically have the effect of lowering GDP... There could be value in programs, but they do not increase growth

If you are in a non-welfare state that transistions into welfare, that is the case. But we are talking about being in a welfare state transistioning out of it. You will see a sudden drop in GDP, and then a market adjustment, just like you do going the other direction.


You seem to be mistaking the cause and effect. Consumption does not create production, production creates consumption...

Nobody can consume what has not been produced. Consumption, you see, is only the effect of production...

Consumption creates demand, that demand drives individuals to create production.

The idea of "if you build it they will come" is part of the disaster that led to the housing bubble. We created more than the natural demand, and now home prices have plumetted and a lot of home builders are out of a job, because they over built. Because there are all these recently new houses, no one wants brand new houses.

I'm talking about long term GDP. There is a definitive negative effect on long term GDP from Welfare states...

The more important thing here is the consumption-production relationship...

You are ignoring that all consumption is only the result of production...

A worker only sells what he/she produces. Someone who produces nothing can buy nothing...

Nobody can consume what has not been produced...

As for the housing point, you ignore that the problem was not overinvestment, but malinvestment...

The government overexpanded credit for years, creating a false boom... This came crashing down when the housing market crashed in 2008... The economy simply needs to readjust to the problems, before it resumes real growth...
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Ore_Ele
Posts: 25,980
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9/15/2011 8:11:46 PM
Posted: 5 years ago
At 9/15/2011 8:05:21 PM, jimtimmy wrote:
At 9/15/2011 6:19:57 PM, Ore_Ele wrote:
At 9/15/2011 10:20:48 AM, jimtimmy wrote:
At 9/14/2011 6:24:52 PM, Ore_Ele wrote:
depends on what your morals are.

No one (very very few) is naturally going to take more than they produce, since people are not stagnant by definition. A person who currently takes out more than they put in can be changed and improved.

Since nearly every single child takes away more than they put in, at least for the first many years of life, that alone does not seem like a good argument.

You also run the risk of revolution. Since it is ingrained into people's minds that government is "for the people," should the government turn its back to people (a large portion of people), they are going to fight back to maintain their representation.

Of course doing that is also going to see major contractions in the economy. Since many industries provide goods to those people, removing them removes some demand, and so those companies will shrink (and lay people off). Now, before Mongeese (or goose, can't remember) comes up with a "broken window" claim, saying that the companies would pay less taxes so they'd have more money to invest, let me explain why it would still happen.

Let's say we have a coca cola company. A lot of the poor people (those that take more than they produce) drink cola. Let's just say that 25% of the company's demand comes from those poor people (the number does not alter the general principle). If those poor people are cut off and left to die, the demand for that product will drop 25%, but they'll have more taxes, so they can afford to charge less.

Now, the question is, do you think that the rest of the population is going to up its cola drinking by 33% to offset that lost demand? Probably not, while some industries this might be the case, in many, it is not. So the cola company has to lay off 20% of its workers (since the lower taxes, the price can lower, and so some demand will be recouped).

This means that more people are tossed into the unemployed and they are now in the "taking more than producing" camp. However, companies know that these are productive workers, so they start investing in new companies for these people to work in (new tech, new products, whatever). The problem is, there is a major delay between when those workers are laid off and when the new factories open their doors to allow those people to get back to work. It's not like you get fired today and a new company is wiped up with a fully functioning factory for you to work in tomorrow.

This is where the social programs are suppose to come in, they help people survive that time to get from the old job, to the new one. But if they are gone, you'll find many of those people will now also starve to death.

So you've lost more than just the unproductive workers, you've lost some productive ones as well.

An interesting thing is that large social welfare states typically have the effect of lowering GDP... There could be value in programs, but they do not increase growth

If you are in a non-welfare state that transistions into welfare, that is the case. But we are talking about being in a welfare state transistioning out of it. You will see a sudden drop in GDP, and then a market adjustment, just like you do going the other direction.


You seem to be mistaking the cause and effect. Consumption does not create production, production creates consumption...

Nobody can consume what has not been produced. Consumption, you see, is only the effect of production...

Consumption creates demand, that demand drives individuals to create production.

The idea of "if you build it they will come" is part of the disaster that led to the housing bubble. We created more than the natural demand, and now home prices have plumetted and a lot of home builders are out of a job, because they over built. Because there are all these recently new houses, no one wants brand new houses.

I'm talking about long term GDP. There is a definitive negative effect on long term GDP from Welfare states...

That depends on how you look at it. There is lost potential for sure. But that is usually because welfare states don't view the GDP is their primary goal.



The more important thing here is the consumption-production relationship...

You are ignoring that all consumption is only the result of production...

And all production is a result of demand. If I don't have money for something, I cannot demand that it is made, and so it will not be made.


A worker only sells what he/she produces. Someone who produces nothing can buy nothing...

Nobody can consume what has not been produced...

But if you want something, then someone will make it. Going off of a "produce" first would indicate only random market movement for new technology. Consumers have needs for new tech (giving innovation direction), so that producers can see where future money is.


As for the housing point, you ignore that the problem was not overinvestment, but malinvestment...

The government overexpanded credit for years, creating a false boom... This came crashing down when the housing market crashed in 2008... The economy simply needs to readjust to the problems, before it resumes real growth...

1) Overexpanded credit is overinvestment.

2) It wasn't the government that overexpanded the credit for years, it was private businesses. The private sector made the loans, and the government foolishly bought up the bad loans. But the private market started it (because they knew that they could sell any junk loan to the government, so there was no risk to them).
"Wanting Red Rhino Pill to have gender"
jimtimmy
Posts: 3,953
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9/15/2011 8:31:46 PM
Posted: 5 years ago
At 9/15/2011 8:11:46 PM, Ore_Ele wrote:
At 9/15/2011 8:05:21 PM, jimtimmy wrote:
At 9/15/2011 6:19:57 PM, Ore_Ele wrote:
At 9/15/2011 10:20:48 AM, jimtimmy wrote:
At 9/14/2011 6:24:52 PM, Ore_Ele wrote:
depends on what your morals are.

No one (very very few) is naturally going to take more than they produce, since people are not stagnant by definition. A person who currently takes out more than they put in can be changed and improved.

Since nearly every single child takes away more than they put in, at least for the first many years of life, that alone does not seem like a good argument.

You also run the risk of revolution. Since it is ingrained into people's minds that government is "for the people," should the government turn its back to people (a large portion of people), they are going to fight back to maintain their representation.

Of course doing that is also going to see major contractions in the economy. Since many industries provide goods to those people, removing them removes some demand, and so those companies will shrink (and lay people off). Now, before Mongeese (or goose, can't remember) comes up with a "broken window" claim, saying that the companies would pay less taxes so they'd have more money to invest, let me explain why it would still happen.

Let's say we have a coca cola company. A lot of the poor people (those that take more than they produce) drink cola. Let's just say that 25% of the company's demand comes from those poor people (the number does not alter the general principle). If those poor people are cut off and left to die, the demand for that product will drop 25%, but they'll have more taxes, so they can afford to charge less.

Now, the question is, do you think that the rest of the population is going to up its cola drinking by 33% to offset that lost demand? Probably not, while some industries this might be the case, in many, it is not. So the cola company has to lay off 20% of its workers (since the lower taxes, the price can lower, and so some demand will be recouped).

This means that more people are tossed into the unemployed and they are now in the "taking more than producing" camp. However, companies know that these are productive workers, so they start investing in new companies for these people to work in (new tech, new products, whatever). The problem is, there is a major delay between when those workers are laid off and when the new factories open their doors to allow those people to get back to work. It's not like you get fired today and a new company is wiped up with a fully functioning factory for you to work in tomorrow.

This is where the social programs are suppose to come in, they help people survive that time to get from the old job, to the new one. But if they are gone, you'll find many of those people will now also starve to death.

So you've lost more than just the unproductive workers, you've lost some productive ones as well.

An interesting thing is that large social welfare states typically have the effect of lowering GDP... There could be value in programs, but they do not increase growth

If you are in a non-welfare state that transistions into welfare, that is the case. But we are talking about being in a welfare state transistioning out of it. You will see a sudden drop in GDP, and then a market adjustment, just like you do going the other direction.


You seem to be mistaking the cause and effect. Consumption does not create production, production creates consumption...

Nobody can consume what has not been produced. Consumption, you see, is only the effect of production...

Consumption creates demand, that demand drives individuals to create production.

The idea of "if you build it they will come" is part of the disaster that led to the housing bubble. We created more than the natural demand, and now home prices have plumetted and a lot of home builders are out of a job, because they over built. Because there are all these recently new houses, no one wants brand new houses.

I'm talking about long term GDP. There is a definitive negative effect on long term GDP from Welfare states...

That depends on how you look at it. There is lost potential for sure. But that is usually because welfare states don't view the GDP is their primary goal.

Fair enough



The more important thing here is the consumption-production relationship...

You are ignoring that all consumption is only the result of production...

And all production is a result of demand. If I don't have money for something, I cannot demand that it is made, and so it will not be made.

Yes, but where do you get money from? Your production... Money is goods... Goods are produced... Demand is only the result of supply...

You see, all economies are are resources... We use money to represent resources, but money still represents things that the holder of the money has produced...


A worker only sells what he/she produces. Someone who produces nothing can buy nothing...

Nobody can consume what has not been produced...

But if you want something, then someone will make it. Going off of a "produce" first would indicate only random market movement for new technology. Consumers have needs for new tech (giving innovation direction), so that producers can see where future money is.

The free market is all about consumer demand, of course. Producers complete for consumers... But, consumers are only using what they have already produced to consume.

When someone needs to eat, they must produce food before they eat it... Them wanting food is not enough...

Likewise, if there are two people and one has food and the other has nothing. The one with nothing must produce something of value to trade with the person with food...


As for the housing point, you ignore that the problem was not overinvestment, but malinvestment...

The government overexpanded credit for years, creating a false boom... This came crashing down when the housing market crashed in 2008... The economy simply needs to readjust to the problems, before it resumes real growth...

1) Overexpanded credit is overinvestment.

Not really, overexpanded credit led to a misallocation of resources... aka: an artificial boom. This is not overproduction or a "general glut", but misallocation of resources. Demand always = Supply... as Demand is only the result of supply

The problem is miscoordination between the two...

2) It wasn't the government that overexpanded the credit for years, it was private businesses. The private sector made the loans, and the government foolishly bought up the bad loans. But the private market started it (because they knew that they could sell any junk loan to the government, so there was no risk to them).

No, it was the Fed... They followed an easy money, low interest rate policy for years... This led to private businesses taking the false signal to overexpand investment... It all goes back to the Central Bank though...
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