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Author Topic: Wealth Distribution Is Good For The Economy Back to Topics
SemiSteve

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Message Posted: Feb 19, 2013 7:53:31 PM

When wealth is spread out among many people they have increased discretionary spending power. When they buy things it helps the economy.

Conversely, when wealth is concentrated in great amounts held by a relatively few number of people there is a lack of wealth distribution; and most people have little discretionary spending power. They don't buy as much; so the economy slows down. That is what had been happening for the last 35 years.

It is better for the economy for most people to be doing fairly well than it is for a few to be doing extremely well and most people just getting by. Therefore, in order to improve our economy we should be looking for ways to reduce wealth inequality.

Raising the minimum wage is one way to ensure that the lower paid workers have more buying power. Another way would be to limit the income of the executives of large corporations to a multiple of their average workers income. Breaking up the largest corporations and banks so that there is more competition in markets would also help. Increased unionization also reduces wealth inequality. It would be very beneficial to take away the special treatment the biggest banks get from the Federal Reserve and allow market forces to work naturally.

"The primary mechanism for uploading wealth is debt-based creation of new money under the system of fractional reserve lending under the central control of the private bank-owned Federal Reserve, which supplies money, at interest, to the U.S. Government. Commercial banks create electronic entry money when they make loans, typically up to ten times the amount in their reserves. This contributes to cyclical asset hyperinflation bubbles and busts, in which the Big Five money-center banks are key players and from which the super-wealthy emerge relatively wealthier. This has resulted in a virtually permanent super-elite."

"In 2007 the richest 1% of the American population owned 34.6% of the country's total wealth, and the next 19% owned 50.5%. Thus, the top 20% of Americans owned 85% of the country's wealth and the bottom 80% of the population owned 15%. Financial inequality was greater than inequality in total wealth, with the top 1% of the population owning 42.7%, the next 19% of Americans owning 50.3%, and the bottom 80% owning 7%.[9] However, after the Great Recession which started in 2007, the share of total wealth owned by the top 1% of the population grew from 34.6% to 37.1%, and that owned by the top 20% of Americans grew from 85% to 87.7%. The Great Recession also caused a drop of 36.1% in median household wealth but a drop of only 11.1% for the top 1%, further widening the gap between the 1% and the 99%.[8][9][10]"

"A 2011 study found that US citizens across the political spectrum dramatically underestimate the current US wealth inequality and would prefer a far more egalitarian distribution of wealth.[7]"

wiki: Wealth inequality in the United States

[7.] ^ Norton, M.I.; Ariely, D. (2011). "Building a Better America – One Wealth Quintile at a Time" (PDF). Perspectives on Psychological Science 6: 9–12.

[Edited by: SemiSteve at 2/19/2013 7:54:46 PM EST]
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SemiSteve
Champion Author Tampa

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Message Posted: Nov 23, 2014 10:04:31 AM

"So they didn't start their businesses with the intent of making money? They didn't go to work in order to make money?"

Nowhere is it written declared nor understood that making money or having the intent to do such is synonymous with greed. FYI, it is possible to make money, and plenty of it, without being greedy. Look at any worker cooperative, such as Union Cab in Madison. Nobody getting disproportionally rich as others barely squeak by. Everyone doing quite nicely.

All one has to do is look outside the box to see this. The greed box that is...

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nstrdnvstr
Champion Author Twin Cities

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Message Posted: Nov 23, 2014 7:49:43 AM

WeasleSpit, ""Greed also gave us many technological advances we have today. We wouldn't have personal computers if those that first built them weren't "greedy", wanting to make money.

That isn't what inspires ground-floor innovators like Jobs, Gates, etc."

So they didn't start their businesses with the intent of making money? They didn't go to work in order to make money?
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Cirdan
Champion Author Nevada

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Message Posted: Nov 23, 2014 1:26:28 AM

"It wasn't greed which motivated people to undertake such endeavors. That is ambition, drive and determination."

That doesn't explain a significant shortage of entrepreneurship/innovation in high-tax Europe vs. the US. There are very, very, few Bill Gates, Steve Jobs, Larry Ellisons, or Mark Zuckerbergs there vs. here.
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SemiSteve
Champion Author Tampa

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Message Posted: Nov 22, 2014 12:12:34 PM

nstdr: "Well that depends on how one defines "greed". "Greed also gave us many technological advances we have today. We wouldn't have personal computers if those that first built them weren't "greedy", wanting to make money."

No. It wasn't greed which motivated people to undertake such endeavors. That is ambition, drive and determination.

Working together with others is one thing. Taking advantage of them from a more powerful position is another. That is the distinction between ambition and greed.

Ambition is win/win philosophy.

Greed is win/lose.

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Weaslespit
Champion Author Cincinnati

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Message Posted: Nov 22, 2014 10:40:01 AM

"Greed also gave us many technological advances we have today. We wouldn't have personal computers if those that first built them weren't "greedy", wanting to make money.

That isn't what inspires ground-floor innovators like Jobs, Gates, etc.

"Well that depends on how one defines "greed"."

Clearly not.
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nstrdnvstr
Champion Author Twin Cities

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Message Posted: Nov 22, 2014 5:51:05 AM

"Well it is no secret that greed causes a lot of grief in this nation and others. It represents one of the worst qualities of humans. People do terrible things because of greed. Both within and outside the confines of law and consideration for others."

Well that depends on how one defines "greed". "Greed also gave us many technological advances we have today. We wouldn't have personal computers if those that first built them weren't "greedy", wanting to make money.
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Weaslespit
Champion Author Cincinnati

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Message Posted: Nov 21, 2014 8:18:46 PM

"Reality is that greed corrupts all -isms."

Bingo.
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rjhenn
Champion Author Des Moines

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Message Posted: Nov 21, 2014 7:01:24 PM

Reality is that greed corrupts all -isms.
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Troller_Diesel
Champion Author Denver

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Message Posted: Nov 21, 2014 6:30:21 PM

So, he's espousing Objectivism?

Good job!

It's about time he started discussing reality...
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rjhenn
Champion Author Des Moines

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Message Posted: Nov 21, 2014 6:05:42 PM

Troller_Diesel - "Gosh. You've just perfectly described Socialist and Progressivism."

And Capitalism and Religion and several others. What Steve was talking about isn't limited to any particular -ism, but is common to all human endeavors.
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Troller_Diesel
Champion Author Denver

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Message Posted: Nov 21, 2014 5:56:54 PM

Gosh. You've just perfectly described Socialist and Progressivism.
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SemiSteve
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Message Posted: Nov 21, 2014 5:31:50 PM

street,

Well it is no secret that greed causes a lot of grief in this nation and others. It represents one of the worst qualities of humans. People do terrible things because of greed. Both within and outside the confines of law and consideration for others.

Some mix greed with ambition; and seek fortunes through perfectly legal means. They can become very powerful that way. The power can go to their heads. They lose grasp of right and wrong and replace it with a rationalization that 'if it is legal that makes it right.' We know this is not correct.

They can even go so far as to use that power to make things legal which should never be. And they can also get the idea that they are so powerful that they can get away with illegal things if they work it a certain way using their power to ensure they won't be held accountable.

This greed and power combination makes it possible for them to become even more powerful. They get hooked on power. People become meaningless to them. All that matters is protecting and furthering their power and fortunes.

Some are born into this lifestyle and taught that it is fine. They are handed vast fortunes and a mandate to continue the greed. They can be the worst offenders.

Eventually they will destroy our nation. It has happened before to other nations before us. Many many times. It can happen to us. And it looks like we are headed that way.

We, the people, also have a lot of power. But it is collective power, not concentrated. If enough people understand what is going on, we have the power to curtail the greed and power of the power-junkies.

I feel that we must seize this collective power in order to save our nation for our descendants.

The top tier of many large multinational corporations and many politicians are afflicted with this greed. They are drunk on it. They are corrupted with it. They do not rise up to the responsibility of proper restraint of the temptation to use such power for petty pursuits.

You know that saying about absolute power. It is right on.

As we watch the power and the wealth inequity grow we are also witnessing the lead-up to the downfall of our nation.

If a nation such as ours, with our great Constitution, can not endure, what hope is there for mankind?

Those who understand must embrace the cause. We must communicate the situation and get as many others as possible to understand that: what we have is not guaranteed. We can lose it. We must not take things for granted.

People gave a lot to set up this nation. The work is not done. It falls upon us to fight for survival as well in our own way against our own enemies.

Remember the thing about all enemies, foreign and domestic?

This one is right here in our own back yard.

Greed has the power to destroy our nation and our habitat.

If we let it.
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rjhenn
Champion Author Des Moines

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Message Posted: Nov 18, 2014 7:22:06 PM

nstrdnvstr - "CEOs are not part of compensation committees."

But who do they socialize with?

"So all those jobs, and the families that are supported by those jobs are not important?"

To the people that have those jobs, yes, they're quite important. To the economy as a whole, they're pretty insignificant.

But keep on trying!
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streetrider
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Message Posted: Nov 18, 2014 10:10:18 AM

Steve are you still trying to out the good ole boys club.

Roflmao
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SemiSteve
Champion Author Tampa

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Message Posted: Nov 18, 2014 10:03:49 AM

nstdr: "CEOs are not part of compensation committees."

True. Not their own, in large publicly traded companies. But they frequently sit on the boards of other large corporations. Whose executives sit on the board of their own. And so it becomes a matter of you scratch my back; I'll scratch yours.

And then they have lunch at 'the club.' Where they decide whose yacht they will go out on.
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Weaslespit
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Message Posted: Nov 18, 2014 9:33:25 AM

"So all those jobs, and the families that are supported by those jobs are not important?"

The King of Strawmen has spoken....
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nstrdnvstr
Champion Author Twin Cities

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Message Posted: Nov 17, 2014 8:06:56 PM

rjhenn, ""It benefits the people that work at the businesses where the executives shop. It benefits real estate agents, brokerage employees, banks, and the economy in general."

IOW, not much, and even that is extremely limited."

So all those jobs, and the families that are supported by those jobs are not important?
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nstrdnvstr
Champion Author Twin Cities

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Message Posted: Nov 17, 2014 8:05:33 PM

SemiSteve, "nstdr:"The market dictates that they [executives] are worth that much."

No, they get that much because they have some inside control over how much they are paid. Manipulating the process with certain power does not constitute 'market controlled.'"

CEOs are not part of compensation committees.
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streetrider
Champion Author Gary

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Message Posted: Nov 17, 2014 8:02:29 AM

Skewed markets dictate slanted vision.
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rjhenn
Champion Author Des Moines

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Message Posted: Nov 16, 2014 6:22:36 PM

nstrdnvstr - "The market dictates that they are worth that much."

No, the "good ol' boy" system that sets their pay dictates that they are worth that much. Even when they fail.

"It benefits the people that work at the businesses where the executives shop. It benefits real estate agents, brokerage employees, banks, and the economy in general."

IOW, not much, and even that is extremely limited.

"And you just showed again that what I claimed you said is true, that the executives don't do "actual work"."

From my actual experience dealing with some executives.
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SemiSteve
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Message Posted: Nov 16, 2014 6:08:21 PM

nstdr:"The market dictates that they [executives] are worth that much."

No, they get that much because they have some inside control over how much they are paid. Manipulating the process with certain power does not constitute 'market controlled.'
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nstrdnvstr
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Message Posted: Nov 16, 2014 5:13:15 PM

rjhenn, "Is the work that those executives do worth hundreds or thousands of times what the work the actual workers do is worth to the company?"

The market dictates that they are worth that much.

"Is concentrating wealth and income like that doing anybody besides those directly benefiting any good?'

It benefits the people that work at the businesses where the executives shop. It benefits real estate agents, brokerage employees, banks, and the economy in general.

"Since different businesses have different cost structures, that's an impossible question to answer. In general, though, more than they're getting now should go to the ones doing the actual work."

And you just showed again that what I claimed you said is true, that the executives don't do "actual work".
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rjhenn
Champion Author Des Moines

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Message Posted: Nov 16, 2014 4:13:21 PM

nstrdnvstr - "Well you think that "the people that really work" earn more than they are getting paid currently. So where do you think that money originally comes from? It comes from revenue. It can't come from anywhere else in a successful business."

Belaboring the obvious. BTW, if you're going to quote me, I'd appreciate it if you quoted something I actually wrote, instead of what you wanted to see.

"You have said often that the executives should be paid less (from revenue) and the "workers" (as if executives don't really work) should be paid more (from revenue)."

Is the work that those executives do worth hundreds or thousands of times what the work the actual workers do is worth to the company? Is concentrating wealth and income like that doing anybody besides those directly benefiting any good?

OTOH, paying other employees more would increase consumer spending, thus demand for products, thus creating more jobs and more consumer spending. And even more wealth for the top 0.1%

The only downside to that is that their wealth and income would only be dozens or hundreds of times the average, instead of hundreds or thousands of times. IOW, they wouldn't be as able to brag that they're so much richer than the rest of us.

"So what percentage of revenue should go to what you call "the worker" and what percentage should go to the executives?"

Since different businesses have different cost structures, that's an impossible question to answer. In general, though, more than they're getting now should go to the ones doing the actual work.
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Weaslespit
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Message Posted: Nov 16, 2014 1:55:35 PM

"Weasle, your Nobel Laureate can sit in his ivory tower and pontificate until he retires on his public sector pension and double dips back into the system by "working" during his retirement. He probably doesn't have a lick of real world experience in the private sector economy, so I pay little heed to his lofty pronouncements."

Good strategy - attack the source, rather than the points he brings up.

Typical.
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nstrdnvstr
Champion Author Twin Cities

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Message Posted: Nov 16, 2014 9:57:22 AM

rjhenn, "nstrdnvstr - "You assume that a set percentage of revenue belongs to the employee from the start. Where did you get that crazy idea?"

Where did you get the crazy idea that I assumed such?"

Well you think that "the people that really work" earn more than they are getting paid currently. So where do you think that money originally comes from? It comes from revenue. It can't come from anywhere else in a successful business.

You have said often that the executives should be paid less (from revenue) and the "workers" (as if executives don't really work) should be paid more (from revenue).

So what percentage of revenue should go to what you call "the worker" and what percentage should go to the executives?
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MarkJames
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Message Posted: Nov 16, 2014 9:50:45 AM

<<The overtime wages paid to the employees are actually more efficient that hiring more workers at 40 hours per week. It's actually the opposite of what many businesses assume, businesses that won't let employees work a single minute of overtime.>>

Due to the cyclic nature of demand in many industries it makes more sense to have existing workers work overtime and/or use temps, subs and on-call workers to meet temporary, seasonal or unexpected demand.

Due to shortages of skilled/multi-skilled workers (willing to work for wages businesses can support) many existing workers end up working a lot of overtime and businesses turn down or lose a lot of work.

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rjhenn
Champion Author Des Moines

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Message Posted: Nov 16, 2014 2:26:22 AM

I75at7AM - "You like to point out a couple of highly-paid corporate execs and assume that all people in company management are in that same income percentile. There are very very few "at the top", and that's why they say 'there's room at the top!'"

So then, in your opinion, there is no income and wealth disparity problem? It isn't true that wages for the vast majority of working people are stagnant and most of the benefits from economic growth are going only to the few?
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rjhenn
Champion Author Des Moines

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Message Posted: Nov 16, 2014 2:25:32 AM

nstrdnvstr - "You assume that a set percentage of revenue belongs to the employee from the start. Where did you get that crazy idea?"

Where did you get the crazy idea that I assumed such?
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SemiSteve
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Message Posted: Nov 15, 2014 9:55:45 AM

I-75, you make a good point. More people are employed at small business than in large corps. But since large corps weild so much power they drive a disproportionate chunk of the economy, as Weasle points out. If those pieces you make are purchased by a biggie then they mark em up and pocket the lion's share of YOUR work, and therefore some of your wealth before you ever see the tax man take some of the more visible part.
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I75at7AM
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Message Posted: Nov 15, 2014 8:52:07 AM

Rj, in this industry, there are almost exclusively small companies. The number of people employed in small companies versus large companies isn't even close. The larger companies tend to be names you may have heard of, such as automakers and large concerns such as GE and Emerson. But their supplier base is mostly small companies and we have many times more employees than they do. So trying to interpolate up the "problem" of unequal wealth distribution just doesn't work here. You like to point out a couple of highly-paid corporate execs and assume that all people in company management are in that same income percentile. There are very very few "at the top", and that's why they say "there's room at the top!"

Weasle, your Nobel Laureate can sit in his ivory tower and pontificate until he retires on his public sector pension and double dips back into the system by "working" during his retirement. He probably doesn't have a lick of real world experience in the private sector economy, so I pay little heed to his lofty pronouncements.

[Edited by: I75at7AM at 11/15/2014 8:53:20 AM EST]
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nstrdnvstr
Champion Author Twin Cities

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Message Posted: Nov 14, 2014 9:39:03 PM

rjhenn, "
Funny, but you don't seem to have any objection to having the wealth you create "confiscated and given to someone else" by those who do so "just because" they have the power to take it for themselves."

You assume that a set percentage of revenue belongs to the employee from the start. Where did you get that crazy idea?
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Weaslespit
Champion Author Cincinnati

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Message Posted: Nov 14, 2014 9:25:42 PM

"You can't beat my facts with your fanciful fallacies."

Then care to respond to the facts brought forth by the Nobel Laureate I linked to?

I noticed you were strangely silent regarding that one, which is unusual for you.
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rjhenn
Champion Author Des Moines

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Message Posted: Nov 14, 2014 7:53:14 PM

I75at7AM - "As Soylent Grain told you recently in another thread, that is one whopper of a delusion.
I hope you can regain some grasp of reality."

Reality says that income and wealth disparity is at or near an all-time high, and that it is damaging the country.

"There are times when the machinists are getting heavy overtime and literally gross as much as the company owner. (I used to run the payroll too)"

Which only means that your small company probably isn't part of the problem. Did you notice the "in some cases" in my statement???

Or did you ignore that in order to cling to your "whopper of a delusion"?

"You can't beat my facts with your fanciful fallacies."

Sorry, but your facts come from one small company, not the large corporations that drive wealth and income disparity. Can you say the same about the owners and executives of all of your suppliers? And all of theirs?
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I75at7AM
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Message Posted: Nov 14, 2014 4:08:37 PM

As my example did not include "specifics", I beg to differ with that assessment. Although we don't count the dollar cost of every overhead item per every part produced, we do know what our overhead is, and it includes all personnel who aren't involved in production, and all the costs of the building, machinery, utilities, vehicles, and taxes for the company. We know how many dollars per hour the overhead costs compared to how many hours worked in production. We always prefer to have the machinists work some overtime, because that further dilutes the costs of overhead. The overtime wages paid to the employees are actually more efficient that hiring more workers at 40 hours per week. It's actually the opposite of what many businesses assume, businesses that won't let employees work a single minute of overtime.

Steve, you further conclusions are partially correct.
This company is considered small, but when I started here there were five employees, now there are fifty. Most people have been here several years, at least five, and we have several over twenty years now. It's hard to find good reliable people (just ask Mark James), so only foolish companies would let them go.

As for the kind of work we do, it is high precision, and yes, low volume. There are companies here in the USA that do run high production, and can compete cost-wise with parts made anywhere. American energy costs have come down, making up for low cost overseas competitors that have high freight costs (diesel is still high, for trucks and ships). Mostly,, American manufacturers are able to respond quickly to their customers' needs, which is just not possible with offshore sources. We build stuff to order in about two weeks. Our customers have operations all over, including overseas, but the tooling is made mostly in the US. Because we are the best.

As for how much manufacturing has gone overseas, yes it seems like a lot, but that is the lower-end stuff. The total value of American manufactured products, on an annual basis, has never gone down. Never. That is an absolute fact.
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SemiSteve
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Message Posted: Nov 14, 2014 3:12:03 PM

Upon closer scrutiny I see that your example gives few specifics, I-75. So my contention that it was fabricated was incorrect. I apologize.

I'm glad you are working at a company which still employs American workers for manufacturing. It must be difficult to compete with cheap foreign labor. I would hazard a guess that this is a relatively small business. My reason for this guess is that most large corporations have moved machining offshore, completely cutting out the American worker. (unintentional pun noted) Remaining machining operations are mostly small scale and custom-order. Anything large scale and repetitive is mostly offshored and/or automated.

One possible exception to the above is building parts for weapons. Many government contracts stipulate that the work be done within the USA.

Small businesses generally do not have the income disparity that large corporations do because at their size they are not competitive enough to support that. Small business owners typically work very hard and earn on the order of 1X to 20X the pay of the average worker. I do not consider them to be oppressive.

When a business gets to the size that the owners and executives do not even personally know all or most of their employees that is where compassion and caring break down and are replaced by indifference and greed.

Large corporations are more apt to see workers as little more than numbers; and treat them as replaceable industrial machinery. Large corporations, with their bean-counters and analysts are always looking for ways to change the bargain between the employer and the worker in the employer's favor. The only time they do anything in favor of the worker is when they have pushed their greed too far and are unable to retain good enough workers to maintain production. In that case they do what they must to keep product moving out the door. And that is the only reason they might do anything which helps the worker. Otherwise, all focus is on increasing profits because that is how the CEO increases his own income and maintains his own job security. If doing so means firing all the workers and replacing them with machines or sending the work offshore then they will not hesitate to do that.

[Edited by: SemiSteve at 11/14/2014 3:18:18 PM EST]
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I75at7AM
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Message Posted: Nov 14, 2014 2:34:50 PM

>>>I am well aware of how business works. In your example all the numbers are fabricated to support your conclusion.<<<

Very apparently you do not know. I fabricated nothing. I have been here at this machinery company 29 years, and I do job cost analysis.

>>>Of course, you're ignoring the fact that the business owner, and the employers of all the other people involved with the production of that part, walk away with, in some cases, hundreds of times what the machinist, and the other people involved, gross.<<<

As Soylent Grain told you recently in another thread, that is one whopper of a delusion.
I hope you can regain some grasp of reality.

There are times when the machinists are getting heavy overtime and literally gross as much as the company owner. (I used to run the payroll too)

You can't beat my facts with your fanciful fallacies.

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SemiSteve
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Message Posted: Nov 14, 2014 1:46:11 PM

I-75: "A machinist makes $20 per hour. In one hour he makes a part that the company sells for $50. ..."

I am well aware of how business works. In your example all the numbers are fabricated to support your conclusion. An equally slanted story could be fabricated in which the numbers are shown to heavily favor the 1%. Now the question is: Which one is closer to the truth?

I believe if you examine the breakdown of wealth held by each strata of the distribution of wealth in this nation it will give a strong indication of which is more correct.

Our nation is rapidly approaching a point (if it has not already been reached) where there has never existed a greater disparity in wealth concentration. That includes times when powerful humans owned other humans and treated them as beasts of burden. Yes, slavery. In those days, our weak nation was struggling for existence, protected mostly by geography. American became the strong world power it is only after a strong middle class evolved. Now that we are killing that middle class and moving toward a nation of haves and have-nots (as we were in the days of slavery) our relative power on the world stage is eroding.

EZExit: "An employer's reason for being in business isn't to provide jobs for other people."

Perhaps it should be; or at least it should for some.

Worker cooperatives are businesses operated as a democracy and collectively owned by the employees. They are difficult to get launched, but once strong enough will grow and become every bit as competitive as top-down businesses run by a powerful few, perhaps even more competitive because the wealth is not siphoned off to make a few families rich and instead returned to the business. What we should be looking at is ways to encourage the establishment and nurturing of such businesses which would be inherently more focused on the rights of workers.
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rjhenn
Champion Author Des Moines

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Message Posted: Nov 14, 2014 1:35:32 PM

I75at7AM - "Hope you understand how it really works. Have a great day!"

Of course, you're ignoring the fact that the business owner, and the employers of all the other people involved with the production of that part, walk away with, in some cases, hundreds of times what the machinist, and the other people involved, gross. Just because they can.
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rjhenn
Champion Author Des Moines

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Message Posted: Nov 14, 2014 1:34:41 PM

EZExit - "To redistribute wealth, you have to take it from one person and give it to another. This is where a person would receive "more money" and spend more, while another would receive "less money" and spend less. Many of us have worked, or are currently working hard for what we have, and we certainly don't want our hard work to be confiscated and given to someone else "just because"."

Funny, but you don't seem to have any objection to having the wealth you create "confiscated and given to someone else" by those who do so "just because" they have the power to take it for themselves.

"There is absolutely nothing standing in the way of any American working hard to better themselves. Those that choose not to is none of my business, nor is it my responsibility, unless I freely choose to accept it of my own accord."

Except that, of course, there are quite practical barriers to "working hard to better themselves".

"An employee's worth is based on market conditions"

And market conditions are largely controlled by those with the wealth.
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rjhenn
Champion Author Des Moines

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Message Posted: Nov 14, 2014 1:28:20 PM

nstrdnvstr - "No, but that is what you are advocating with government control of income and the re-distribution of wealth you are calling for."

And you're still making things up to suit your arguments. That's called a strawman argument.

The fact is that the increasing income and wealth disparity in this country is restricting economic growth, and destabilizing society.
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Weaslespit
Champion Author Cincinnati

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Message Posted: Nov 14, 2014 11:55:42 AM

In his new book, Nobel Prize-winning economist and Columbia Business School professor Joseph Stiglitz argues that growing inequality and economic unfairness could threaten the stability of the country in the long run.

"We care about inequality partly because we pay a high price in terms of our economic performance. We care about it also because of the impact that it has in every other aspect of our society -- our democracy, our rule of law, our sense of identity or a land of opportunity -- because we aren't anymore.

The people at the top are not the people who made the most contributions to our society. Some of them are. But a very large proportion (is) simply people I describe as rent-seekers -- people who have been successful in getting a larger share of the pie rather than increasing the size of the pie."

"Rent is a return on income that you get not as a result of your contribution but because of your ownership of land. It was a notion that income does not have to rise out of effort or making a contribution."

[Edited by: Weaslespit at 11/14/2014 11:56:34 AM EST]
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EZExit
Champion Author Phoenix

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Message Posted: Nov 14, 2014 11:45:32 AM

An employer's reason for being in business isn't to provide jobs for other people. They are in business to provide a service to their clients and to make a profit doing so. If their are no profitable jobs to work on, then everyone goes home until there is.

Again, an employee or ward of the state controls their own destiny. Many have no drive nor desire to apply themselves to what is required to change their current status. I don't know what entity can change this for them, but it certainly isn't the function of an employer. Unless you somehow take away the free will of a person to remain status quo, you can't make someone change unless they want to change.

An employee's worth is based on market conditions, anything more, or anything less, is arbitrary. Attempting to confiscate over and above the market conditions, is effectively redistributing company profits, despite any word gymnastics that are utilized.

The way I see it, the only taking going on is slight of hand from our government. Jonathan Gruber is currently in the news for getting caught bragging about it. Mandates, regulation, and taxing are tools utilized to arbitrarily control the opportunity and assets of everyone, including the "overburdened and underpaid" employee. Those that have struggled, for instance, to maintain healthcare for themselves have had the rug pulled out from under them, in order to redistribute healthcare towards others. Employees of responsible employers such as Ford Motor Corporation had their employee counterparts propped up artificially by irresponsible employers such as General Motors Corporation. Then you have the whole mass of the private sector paying for government employees to be able to retire after 20 years of service with attractive pensions not available to everyone, such as that 18 year-old hired retiring at the ripe old age of 38.

Your point of the middle class being squeezed is well taken, but you are barking up the wrong tree.
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SE3.5
Champion Author Indianapolis

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Message Posted: Nov 14, 2014 10:31:39 AM

I75, you just don't get it. That evil guy who risked his capital to build the business where the machinist works might have made a profit for his effort (if his expenses were not too high). {;>)
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SE3.5
Champion Author Indianapolis

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Message Posted: Nov 14, 2014 10:23:38 AM

This topic is supposed to be about distributing wealth--NOT re-distributing wealth.

The oil industry distributes wealth by providing lots of high paying jobs. Mining also distributes wealth by providing lots of high paying jobs. Many (in and out of government) actively work to destroy those high paying jobs, because they consider the industries paying those high wages to be evil. Better to have those workers on the dole than getting good wages from such evil enterprises.
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I75at7AM
Champion Author Dayton

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Message Posted: Nov 14, 2014 9:54:01 AM

Steve, regarding your past post, let me tell you how it works in a manufacturing business.

A machinist makes $20 per hour. In one hour he makes a part that the company sells for $50. So the business owner is taking away that extra $30 of wealth, out of sight, before the machinist see it, right?

Wrong.

Here is the rest of the story. That part was made of steel, which cost $5. The machinist used cutting tools (which wear out) to make the part, he made it on a large machine which eventually needs repair and maintenance,the machine used electricity to run the motor. The part was also handled by our inspector, who checked it and marked the part number on it and readied it for delivery (packaging), our driver had to deliver it, in the company truck which uses gasoline. Then the bookkeeper had to prepare and send out an invoice. Meanwhile, the building had lights and heat and the parking lot was plowed and the grass was mowed (different month), all costs which come out of that extra $30 of value the machinist produced.
Oh, yeah, don't forget the employer's share of social security and FICa taxes, workers comp, health insurance, all of which must be paid from that ever-declining $30 extra the machinist produced (but had stolen away from him).

Hope you understand how it really works. Have a great day!
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SemiSteve
Champion Author Tampa

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Message Posted: Nov 14, 2014 9:42:34 AM

"To redistribute wealth, you have to take it from one person and give it to another. This is where a person would receive "more money" and spend more, while another would receive "less money" and spend less. Many of us have worked, or are currently working hard for what we have, and we certainly don't want our hard work to be confiscated and given to someone else "just because"."

I would comment to the essence of this statement. Because you have struck on a feeling which touches many, but most do not realize that the wealth being taken from them is not going to the nonworking poor they resent so much, but instead it is going to the 1% in a cleverly disguised ruse.

Essentially, this is how it works. You are being underpaid by a greater amount than you are being over-taxed.

Those at the top are taking more (before you ever see it, out of sight - out of mind) than you see going out in taxes. You're busy being angry about what you see being taken; and all the while, for every hour you work, more is being taken invisibly behind your back. Every hour you work, you are generating more wealth that you never get than is taken in taxes from what you do get.

Since this is not readily apparent the rich are silently taking wealth from one person (you) and giving it to another who did not earn it (them).

It is just dripping with irony. It is a mass case of the old slight of hand. Pay no attention to the man behind the curtain. Because while he is dazzling you with one hand with the other he is stealing from you every day and you don't even know it!

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Weaslespit
Champion Author Cincinnati

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Message Posted: Nov 14, 2014 8:45:27 AM

"Who are you talking about (having money taken from them) where have I ever advocated that? Did I just finish saying that if they have less to spend they spend less?"

You will quickly realize you cannot have an honest discussion with nstrdvnstr as he twists what is posted by others to continue with his incorrect, off-topic deflections.
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Weaslespit
Champion Author Cincinnati

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Message Posted: Nov 14, 2014 8:43:39 AM

"To redistribute wealth, you have to take it from one person and give it to another."

Talking to the right on this subject is like talking to a brick wall. Why do they keep interjecting 're'distribution, which is not the same subject as wealth distribution?

So many deflections - must be tough to defend the status quo.
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EZExit
Champion Author Phoenix

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Message Posted: Nov 13, 2014 8:49:50 PM

To redistribute wealth, you have to take it from one person and give it to another. This is where a person would receive "more money" and spend more, while another would receive "less money" and spend less. Many of us have worked, or are currently working hard for what we have, and we certainly don't want our hard work to be confiscated and given to someone else "just because".

There is absolutely nothing standing in the way of any American working hard to better themselves. Those that choose not to is none of my business, nor is it my responsibility, unless I freely choose to accept it of my own accord.
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streetrider
Champion Author Gary

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Message Posted: Nov 13, 2014 8:21:34 PM

nstrdnvstr
Said
"So do the people who had that money taken from them correspondingly spend less?"

Who are you talking about (having money taken from them) where have I ever advocated that? Did I just finish saying that if they have less to spend they spend less?

nstrd
also said

"Does it matter how that money was acquired by "the people"?"

You have followed my posts enough to know how I advocate the proper distribution.
Maybe if you have to go back and look for it you will remember it.
I think we would agree

Please keep up, unlike many (yourself included) on here, I subscribe to no party, Just independence that way I am not locked into stupidity.
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