@Rogan2112: That was an excellent and accurate post. I appreciate this. Let me refer to a few points here because I agree with everything else:
@Rogan2112 said:
In the late fifties and through the sixties the economy was still in a large surplus from the money that was made from WW2 (strange huh?).
Indeed. Now, is there a way to get back to that lovely economic boom right now or in the near future? Wasn't it mass industrialization, the Lend-Lease program and the Marshall Plan that helped America get into such a powerful economic position? Were there any other factors?
The main problem is that we are no longer an industrial based economy, we're a service based economy, we're not actually MANUFACTURING much of anything, so the Marshall Plan would help little these day, and is the other factor you spoke of. Unless a nation's economy actually produces something the world wants to buy, it's on a very slippery slope. If another country suddenly can beat us at IT repair, programming, and the like, we're about half cooked
@Rogan2112 said:
There was plenty of demand, but there were more available jobs, but there was also a smaller population. Around the early late mid seventies and through the eighties the working age population pretty much exploded (from the post WW2 baby boomers coming of working age and finishing college from the sixties). The population went up significantly, the number of jobs began to slightly decline due to the increase of technology (robots doing some jobs believe it or not), and most of the good paying jobs, that could pay for a house were either going to college graduates becoming lawyers, doctors, bankers, etc, or skilled laborers like plumbers, building contractors, air conditioner rapair people, etc.
Quite so. There were many jobs available and there were fewer workers (in comparison to today). That is perfect. There was also no Outsourcing, Globalization, Technological Advancements making certain jobs obsolete, etc. Speaking of which, automation and robots will continue to replace low-skilled, human workers. So, what is going to happen? Does everyone have to get a degree or a certificate? I am not saying that there is anything wrong with that, but such a trend will make those degrees become more and more worthless. The greater the supply of academic/trade degrees, the lower the value. I also seem to recall someone telling me that one could live off of those low wages back then because they were properly adjusted to inflation and there was less inflation. Many people could leave their parent's houses at age 18 and not have to go to College or anything like that. That is simply what I have been told.
Well, what was the educational attainment statistics in the seventies and eighties? I ask because there is a 35% college graduate rate in the United States right now. However, there is a 70% college attendance rate as well. So, that shows that there are flaws in the system. Also, the student loan debt is almost at one trillion dollars. That is also disturbing.
Several things you've pointed out are sadly true. A Bachelor's Degree these days is basically the equivilant of a High School diploma from 15 to 20 years go. Weird and unfortunate, but that's the way we're heading, because again, we've become a service based economy and without trained people to conduct those services, we don't have a work force.
@Rogan2112 said:
ut I think it was the former, and to a credit based economy so that's been around a LONG time. The thing is "fair" really has nothing to do with all this. What there is, are product, consumer, and producer.
Did people really have that many credit cards back then?
No, not really. Well, certainly not as many as today. What's evolved, as @AtPhantom pointed out is greed, Greed AND Envy. Problem is, as Americans a lot of people have gotten it into their heads that they are ENTITLED to things they haven't actually earned. It's more important to them to have big screen TVs, nice cars, and so on, because they think the DESERVE them, withoud actually having had to work for them, or at least without having made enough money to afford them. Largely, in my opinion, because they see celebrities and stuff like MTV's "Cribs" and the like and they develope class envy. So they put themselves in a financial whole to try an live up to a lifestyle that they can't possibly meet. In order to do THAT, they use credit, which will eventually swim up and bite them in the ass...or, they simply won't pay the bills, making the credit companies take the loss, adding to the economic down turn. (More on this later)
@Rogan2112 said:
, (the later Bush years) the Democratic majority in Congress, decided things SHOULD be more fair, and they cooked up a way to try to make things more fair so people with less income could get a house, whether they could afford them or not. They gave incentives and more or less forced Fanny May and Freddie Mack to give home lones to people with little or no credit, and little evidence that they would be able to make their payments. Bush, for whatever stupid reason signed off on it, and the crash was on its way. Low and behold all these tens of thousands of home loans came due, and these folks who couldn't pay for the loans and make their payments were allowed to KEEP the homes even though they weren't making the payments, because of the mandate Congress forced the two biggest home lenders into making. Problem is, this doesn't happen in a vacuum. The loans are real money, bank x shells out the actual money to the mortgage company to buy the house on the promise of payments being made. No payments made the bank loses money, so Fanny and Freddy have to pay what the loan holders aren't paying, basically running their companies into the ground til eventually THEY can't make these payments. Before TOO long, these companies run dry, blame the government (for a good reason) and all the homeowners(loan holders) lose their homes and everyone is screaming BUSH DID IT (which, while only partially true) isn't unreasonable.
Yes, those are the FHA loans. Those are not that good because those low-income people have to pay mortgage insurance in addition to the mortgages and interest. If only they could pay large enough down payments to avoid that problem. Of course, one must wonder if those houses are of quality or have major maintenance issues. That could be very costly.
Honestly, I don't have any idea about the quality of the homes so I'm not going to BS and try to give an opinion it it, I will attempt to find out though.
@Rogan2112 said:
Since it took me THAT long to write, saying it's complicated is a major understatement, and lol yeah, I left out a lot. However, one thing I've also been told is that increased spending and lowering taxes, might SOUND good, won't get us anywhere. If you lower taxes...where is the money for the increased spending going to come from? The best plan I'VE heard of is what's called a flat tax, or a national sales tax. One tax rate for all goods and services sold across the board for the entire nation. Let's say ten percent. If Joe wants a $1.00 can of beans, the tax is $.10, if Reginal wants to buy a $200,000.00 yacht the tax, the tax is $2,000..00. That way, everyone IS paying their fair share no matter how much they make or what they buy. Joe and Reginald STILL pay a ten cent tax on a can of beans ;)
Well, taxes for companies and corporations should be reduced because that would create more employment. However, I hear that corporations find loopholes and find ways to avoid paying taxes. So, greed is still the issue. Now, what is going to happen to all of those houses and other properties that get damaged or destroyed by natural disasters? How is that going to affect the housing market?
Also, with the increased spending, I meant to say that rich Americans (or simply Americans who have more spending power) should help the economy by spending more and investing more money into society.
(Here's where I meant "more later") I've heard stuff about this, but really didn't KNOW, but my buddy filled me in on the parts I was iffy about.
There have been several economic theories tried bot both Conservatives and Liberals. Conservatives pretty much believe that you give huge tax breaks to the rich, which will enable them to make cheaper products and service and create more jobs, hire more people and stimulate the economy. This has been shown to SORT of work, but again greed gets into it and high to mid ranking corperate officials will do things like embezzle money or use the extra money quasi-legally to line their own pocket books further. The Liberals believe in the bottom up theory, that if you tax the righ more, that puts more money into the hands of the government (yeah lets trust the GOVERNMENT to help us and spend our money correctly for us, right? Ever heard of a $300.00 toilet seat for government buildings?)...anyway, the idea is they help the less fortunate, food stamps, job developement, educational assistance etc. Sounds great right? Problems are: Greed takes hold again. Government officials do some of the same things the Corperate officials do and line their pockets. The corperations who are getting the crap taxed out of them say "screw this" and move their business to a country who isn't gouging them and "outsource" since even when they aren't being gouged their taxes (even with all their loop holes) pay for 40-60 percent of the nations tax burden anyway. A better solution, find a COMMON ground, find an even tax rate (ooohhhh like that flat tax mentioned before) devide the spoils from it equally at the top AND bottom so that things work their way toward the MIDDLE, where most of the American work force is, which (in all likelyhood...I say this because there's no crystal ball and no PROOF it will work, just a strong likelyhood). So, you have disadvantaged people taken care of to a decent degree (though not as much as the Liberals would prefer), you have Big Buisiness coddled to a reasonable degree (though not to the degree they, or the Conservatives would prefer), everyone MIGHT have to make due with a LITTLE less for awhile, but with more jobs being created by Big Buisiness, more educated lower class, and the already educated middle class, you have people to fill the jobs. They will then have enough money to BUY things, keep the Big Buisinesses running, taxes being paid, and when the Congress votes themselves YET ANOTHER pay raise, they might actually have earned a tiny bit of it this time.
Nice conversation, by the way! I love your post! It's an important topic.
Thank you. As always, my rants are my own opinions and views and are in no way meant to indicate support or agreement by ComicVine :)
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