Re: The Great Divide
From: jim blair (jeblair_at_XXXfacstaff.wisc.edu)
Date: 08/11/04
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Date: Wed, 11 Aug 2004 11:14:33 -0500
<royls@telus.net> wrote in message news:41100889.13312455@news.telus.net...
> On Mon, 2 Aug 2004 13:42:42 -0500, "Jim Blair" <jeb@wisc.edu> wrote:
> >
> >You are missing the way reality works: Young people tend to borrow to buy
a
> >house,
> >and older people tend to loan them the money (with the bank or S&L as the
> >go-between).
> >Both young and old benefit from this exchange.
Roy:
>
> ?? The young people don't benefit from being robbed to pay for the
> government services that make the land more valuable, and then having
> to pay landowners the resulting increased price for the land in
> financial self-defense, and also having to pay interest inflated by
> the need for lending to compete with landownership for the dollars of
> the rich.
>
Hi,
??? You say the young DON"T benefit from buying a house?
And that later, when they are older, they don't benefit from the interest
that they collect on the money that they put into the S&L?
According to you everyone is being "robbed" but somehow they all end up
better off. Hey, that is the way capitalism works ;-)
> >> > The "means of production" CAN belong to "the people". That is now
> >> > happening, just not
> >> > in the way that Marx had in mind.
> >> >
> >> > >
> >> > > Unfortunately it is also true that some are more equal
> >> > > > than others.
> >> > > >
> >> > > > In my opinion, the issue is one of stability rather than
morality.
> >> >
jeb:
> >> > Yes, owning a home and stocks does tend to make individuals more
stable,
> >> > more "conservative", and even more likely to vote Republican.
> >>
> >> Before buying land I felt like a didn't really belong here. I hated
> >having a
> >> landlord. Hated rising rents and rising land prices. Felt like the
> >system was
> >> somehow stacked against the working man.
jeb:
> >
> >It IS stacked against the people who rent all of their life. Better to
be
> >paying off a mortage than to be paying rent.
>
> Better to be paying rent to government than rent to landowners plus
> interest to mortgage lenders plus taxes to government.
??? If I wanted to pay my rent to the government, I would live in a
government housing project. No thanks.
> Of course. The police do a much better job of protecting those who
> are wealthy enough to own than those who aren't wealthy enough to own.
Another reason to own. But sure, police direct their efforts to where the
wealth is, because that is also what attracts criminals.
....
> >> It is not productive investment for us to sell and resell the same land
at
> >rising
> >> prices.
> >
jeb:
> >If the same piece of land becomes ever more valuable (because someone
else
> >is willing to pay ever more for it)... well why not?
>
> Because nothing is contributed thereby. The seller gets something for
> nothing.
But before he could be a seller, he had to first be a buyer?
>...That means somebody else is getting nothing for something.
But was that "somebody else" the buyer? Who will become that seller in a
few decades?
I say that over the cycle, they both have benefitted compared to it the
transactions had not happened.
>
> >> I don't think it's possible for actual productive return on physical
> >capital
> >> investment to supply enough surplus to provide for all retirees.
> >
> >Why not?
>
> Competition.
Marx claimed that competition means there can be no profits. Tell that to
Microsoft.
>
> >It takes ever more capital investment per job as the economy
> >grows. So the interest and dividends paid on that capital become ever
> >larger.
>
> Non sequitur.
>
> >The real question is whether those payments will go to a very few
> >(as in the 19th century), or to an ever growing number of stock and bond
> >holders, as is happening now.
>
> The number of stock and bond holders may be growing, but the fraction
> of all the stocks and bonds held by the wealthiest ones is also
> growing.
So I hear. But the issue here (Great Divide) is not what FRACTION of the
total wealth do I own? (I really don't care).
The question is "how much wealth do I need to retire and live from the
interest and dividends that it generates?"
>
> >> Pension the elderly through land value taxation.
> >
> >Who would decide which of the elderly would get how much? And would that
> >reward those who saved and invested when they were young more than those
who
> >did not?
>
> Give everyone the same amount. That way there is no discrimination,
> and no disincentive to work and save.
>
> -- Roy L
??? If everyone gets the same, what is the incentive to save and invest?
,,,,,,,
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(_)
jim blair (jeblair@wisc.edu) Madison Wisconsin USA.
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