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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: Redstorm]
#8097729 - 03/03/08 01:46 PM (15 years, 10 months ago) |
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I disagree. In the beginning there wasn't capitalism. There was no investor with wealth to build bigger systems. Capitalism developed as a system through class struggles and social revolutions.
Prior to capitalism there were other systems that were unfair and exploited people. The people don't like being controlled by the opposing class, so they revolt. It's a timeless tale told over and over throughout history.
It's easy for a bunch of people to agree to maintain a farm without any capital investment. It's also easy for a group of people to start up a software development company without much capital.
There are countless other ways to enter the economy without selling your time or getting venture capital. Capital investment is simply a rich man's greed.
-------------------- dewbie dewbie dew
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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: fireworks_god]
#8097744 - 03/03/08 01:51 PM (15 years, 10 months ago) |
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Quote:
So, there is the share of capital income steadily increasing for the top 1%, and then you have the government giving greater and greater amounts of tax cuts on capital gains and corporate dividends
I totally agree here. But I explained above that it's impossible to take this profit from the wealthy. If we tax the wealthy they take the jobs to developing nations.
It's a double edged sword here though. By cutting the working class out of high paying jobs they're also cutting out a potential consumer of other investments.
-------------------- dewbie dewbie dew
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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: fireworks_god]
#8097763 - 03/03/08 01:55 PM (15 years, 10 months ago) |
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A capitalist economy thrives because they don't tax the wealthy as much. At least in theory. Ideally speaking, by allowing the rich more tax breaks.. there is a supposed "trickle down" theory. If the rich get richer, everyone gets richer. In practice though, it's eliminating the middle class.
I totally agree with your last statement other than the taxation thing:
Quote:
It can only be done through taxes, and the capital gains and corporate dividends tax is the way to go. If there isn't a check in place that dampens the amount of profit one can gain from investing in corporations, then that profit is going to be funneled out of corporations and away from laborers, the middle class. Wealth is going to accumulate in the top 10% but especially the top 1%. The middle class will be further squeezed out and the economy with it.
I don't think fine tuning the "free market" is going to help in this case at all. Fine tuning free markets has a long history of social control, greed, and corruption.
-------------------- dewbie dewbie dew
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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: bradmassive]
#8097808 - 03/03/08 02:09 PM (15 years, 10 months ago) |
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Fortunately for this argument, we don't live in a "free market" society.
I read nearly all of Adam Smith's work in college. I suggest you read about Historical Materialism though.
I understand how capitalism works.. Unfortunately there are problems with true free markets and they must be "maintained" because some businesses require a local monopoly (like natural gas and electric services), and others have made enough capital to maintain their market share by locking consumers in (like Microsoft, AT&T, Big Oil, etc.)
In practice, capitalism does a lot for a developing country. It helps create a stable means of production. There is a balance though because eventually capitalism stifles progress because there is too much capital, and it all pools near the wealthy end of the spectrum.
-------------------- dewbie dewbie dew
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fireworks_god
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
#8098151 - 03/03/08 03:41 PM (15 years, 10 months ago) |
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Quote:
kristofer said: I totally agree here. But I explained above that it's impossible to take this profit from the wealthy. If we tax the wealthy they take the jobs to developing nations.
No they don't; that only happens if you tax corporations themselves.
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If I should die this very moment I wouldn't fear For I've never known completeness Like being here Wrapped in the warmth of you Loving every breath of you
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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: fireworks_god]
#8098357 - 03/03/08 04:29 PM (15 years, 10 months ago) |
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where will you impose this "wealthy tax"?
I ask because the wealth generally stays within the corporation. Money doesn't ever get passed back to the investors. The stock value increases, increasing the overall wealth of the investor. If the corporation cuts a check to the investors, the stock value would remain relatively constant and that money could be taxed as income, but usually corporations just create new corporations with the capital.
So is it a stock tax? If a stock has a certain value point does the tax rate go up? What if stock splits and the value halves (or the number of shares a stockholder has doubles..) ? Where does that leave investments in abstract markets like hedge funds or mutual funds?
My point is that it's not possible to know how much money a wealthy person makes. It's only possible to know the value of one's assets.
-------------------- dewbie dewbie dew
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fireworks_god
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
#8098530 - 03/03/08 05:10 PM (15 years, 10 months ago) |
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Great points, but I think the obvious tax would be individual capital gains. It used to be higher. I readily admit that I'm not too understanding of this subject, so would restoring a higher tax on capital gains hurt corporations directly?
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If I should die this very moment I wouldn't fear For I've never known completeness Like being here Wrapped in the warmth of you Loving every breath of you
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Redstorm
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
#8098701 - 03/03/08 05:36 PM (15 years, 10 months ago) |
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Explain to me how you would start a farm or a software company without an initial capital investment.
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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: GnosticWarrior]
#8098706 - 03/03/08 05:37 PM (15 years, 10 months ago) |
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GW
Quote:
Workers get paid, regardless if the business operations are profitable or not. They have no vested interest in the company except as a source of employment. They have no obligation to the company except to perform the tasks that they had agreed upon for employment. They can leave at anytime they choose, for whatever reasons.
You're thinking in terms of a particular business. I'm speaking generally about the capitalist vs the laborer. The laborer may have no vested interest in a particular company, but he is still indebted to the capitalist in all aspects of his life.
For example, the same group of people that employ laborers also own the property the employee rents to live on. They're also the people that lend money to the laboring class expecting a return via usury. They also own the stores that the employee shops at. They have investments in public services like electricity and natural gas, and even in necessary commodities like transportation and communication.
A workers contribution to the process should entitle him to a share of the profit, not just an agreed upon livable wage.
-------------------- dewbie dewbie dew
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Redstorm
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
#8098832 - 03/03/08 06:03 PM (15 years, 10 months ago) |
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Quote:
A workers contribution to the process should entitle him to a share of the profit, not just an agreed upon livable wage.
The wage is his share of the profits.
Anyways, why should they receive this? Just because you say so?
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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: Redstorm]
#8098906 - 03/03/08 06:19 PM (15 years, 10 months ago) |
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Quote:
The wage is his share of the profits.
Anyways, why should they receive this? Just because you say so?
I think you misunderstand the difference between a wage and a share.
The wage is the value of his labor, not his share of the profit. His share of the profit would be larger than his wage. Profit is generated because the value of a product is worth more than the cost to produce it.
Labor is a commodity and the value of a commodity is driven down by competition.
The laborer should receive an equal share because of his contribution to the production process.
In my personal experience though, the employees I've hired work harder and develop better products more efficiently when I offer them an equal share to the profits at the end of the year.
-------------------- dewbie dewbie dew
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Redstorm
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
#8098927 - 03/03/08 06:23 PM (15 years, 10 months ago) |
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If laborers trade their labor for wages, why should they receive anything in excess of their agreed upon trade?
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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: Redstorm]
#8099220 - 03/03/08 07:29 PM (15 years, 10 months ago) |
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because they are the profit generating system. the people generate the wealth, and that's why they should be entitled to it.
-------------------- dewbie dewbie dew
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Redstorm
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
#8099232 - 03/03/08 07:31 PM (15 years, 10 months ago) |
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Not until they have a stake in the failure or success of the business, they don't.
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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: Redstorm]
#8099326 - 03/03/08 07:58 PM (15 years, 10 months ago) |
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the workers have the largest stake in the success or failure of any company. without them the company wouldn't produce anything.
the worker loses more than just his time.. he loses his benefits, his retirement, and basically the future that he was working for..
not only that, but the worker loses his income.. which means he can't pay his landlord or feed his children.
-------------------- dewbie dewbie dew
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fireworks_god
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
#8100575 - 03/04/08 05:58 AM (15 years, 10 months ago) |
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I do believe that a lot of corporations do have profit sharing programs for laborers. Whether or not they are getting a big enough cut is another question, but I've got $250 coming to me on Thursday that is my cut of profit for the store (I up until recently worked at) reaching goals in sales, profit, inventory turn, etc for the previous quarter. The company also has a general profit sharing plan that is coupled with 401(k) (well, they are actually two seperate accounts, about equal in size).
Anyways, I haven't found enough information on the individual capital gains tax to satisfy my interest regarding your last post on the matter, so can you help me understand how taxing individual capital gains contributes to corporations taking jobs overseas?
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If I should die this very moment I wouldn't fear For I've never known completeness Like being here Wrapped in the warmth of you Loving every breath of you
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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: fireworks_god]
#8100833 - 03/04/08 08:38 AM (15 years, 10 months ago) |
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when you say capital gain I think of buying assets with the intention of selling it when it appreciates in value.
http://en.wikipedia.org/wiki/Capital_gain
There are some restrictions on how you can buy and sell capital assets, and how they're taxed.
Looks like up until one makes $15000 a year in capital gains they're not even subject to paying tax on it. At that tax floor the rate is 5% and it goes up to 15% the more one profits.
-------------------- dewbie dewbie dew
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phi1618
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
#8101521 - 03/04/08 01:07 PM (15 years, 10 months ago) |
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If your total income is under $15k, you have a lower rate on capital gains. Most people will pay 15% on their long term capital gains, because most people have jobs that pay more than $15k/yr.
Many companies have profit sharing or stock option programs for their employees. Many Americans own some stock, making them capitalists. If you're smart, you'll save a little money and become a capitalist, too.
You've still not offered any answer to the question of how resources get distributed to the activities that need to be performed. If I want to open up a solar cell factory, where's the (very expensive) plant going to come from?
Where's the incentive to take the risk of working 80 hrs. a week to start a business for possibly no benefit at all?
Some businesses, e.g. software, are not very capital-intensive but are very labor-intensive. That's great, but most businesses aren't that way. I don't see that you have any argument here at all other than "workers create value and should be entitled to all of the fruits of their labor."
How would this work for new businesses? How would this work for old businesses where the right thing to do is fire all the workers and sell the assets of the company because there is not enough demand for the products being made and the capital used could be more profitably deployed elsewhere?
In theory, and frequently in practice, investors add significant value by directing resources where they will be needed in the near future, greatly increasing the overall productivity and wealth in society. If you claim that practice frequently breaks down because people rip each other off through various means, I'll agree and we can talk about it - but you're claiming instead that ownership of capital should play no role in the economy (based on fairness?) - and I just don't see, from theory or observation, how this could work better than what we have.
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kristofer
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Re: when capital (or a lack thereof) holds you back.. [Re: phi1618]
#8103235 - 03/04/08 08:29 PM (15 years, 10 months ago) |
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Quote:
If your total income is under $15k, you have a lower rate on capital gains. Most people will pay 15% on their long term capital gains, because most people have jobs that pay more than $15k/yr.
Read the article again.. it's conditional, and not just on income. If you're flipping cars it'll cost you 25% in tax. If you're flipping collectibles it'll cost you 28% to tax. In some cases an individual can collect up to $250,000 in capital gains without being taxed at all.
Quote:
Many companies have profit sharing or stock option programs for their employees. Many Americans own some stock, making them capitalists. If you're smart, you'll save a little money and become a capitalist, too.
I don't need to be told how to live within capitalism. Clearly I understand it well enough to criticize it and see the benefits of progression.
To live in this society you must at least engage in some sort of capitalism. At the very least, trading time for wages. Ideally, everyone would want more. Therein lies the problem. Everyone wants more, but we can't all have more. "If you're smart.." you'll tell your friends that it's time to change the world.
Quote:
You've still not offered any answer to the question of how resources get distributed to the activities that need to be performed. If I want to open up a solar cell factory, where's the (very expensive) plant going to come from?
Ideally, anything significant that would involve the people and their well being would be supported by them financially and otherwise. It's not about if you want to build a solar plant. It's whether or not the people want to build solar plant.
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Where's the incentive to take the risk of working 80 hrs. a week to start a business for possibly no benefit at all?
The incentive is to do something better.. for everyone including yourself. Profit is a destructive incentive because it drives down the value of a man's time.
Quote:
Some businesses, e.g. software, are not very capital-intensive but are very labor-intensive. That's great, but most businesses aren't that way. I don't see that you have any argument here at all other than "workers create value and should be entitled to all of the fruits of their labor."
No, all businesses are all labor. Labor creates wealth. That startup capital kind of jump-starts the process, but ultimately only labor generates profit. The startup capital was also generated by wage labor. We can go in circles here.. but think about it, there's a small percentage of the population at the top and the distribution of wealth trickles down [poorly] from there.
Quote:
How would this work for new businesses? How would this work for old businesses where the right thing to do is fire all the workers and sell the assets of the company because there is not enough demand for the products being made and the capital used could be more profitably deployed elsewhere?
Those decisions should be up to the workers.
Quote:
In theory, and frequently in practice, investors add significant value by directing resources where they will be needed in the near future, greatly increasing the overall productivity and wealth in society.
What? That's not true at all. Productivity is only limited by the flow of capital. The great rich and poor divide is widening because of our capitalist structures. Look at some of the images and links from fireworks_god posted earlier for that evidence.
Quote:
If you claim that practice frequently breaks down because people rip each other off through various means, I'll agree and we can talk about it - but you're claiming instead that ownership of capital should play no role in the economy (based on fairness?) - and I just don't see, from theory or observation, how this could work better than what we have.
It's not about ripping each other off. The wage laborer agrees to his role in the machine. I am saying that ownership of profit generating systems should be shared by people. Equally. Because people are the ones that generate that profit.. not wealthy people.. working class people.
You don't make a billion dollars with exploiting [working class] people.
-------------------- dewbie dewbie dew
Edited by kristofer (03/04/08 08:35 PM)
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phi1618
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Re: when capital (or a lack thereof) holds you back.. [Re: kristofer]
#8103926 - 03/04/08 10:58 PM (15 years, 10 months ago) |
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Quote:
Read the article again.. it's conditional, and not just on income. If you're flipping cars it'll cost you 25% in tax. If you're flipping collectibles it'll cost you 28% to tax. In some cases an individual can collect up to $250,000 in capital gains without being taxed at all.
I didn't read the article at all - I'm sure there's lots of complexity to it. Fact is, though - most people pay long term capital gains of 15% and short term at their marginal tax rate (say, 28%) on stocks.
I don't think you understood my point about ripping people off. Think stock scams, think subprime mortgage securitization, think agriculture subsidies and prisons. These are all failures in our current system that could be addressed through proper (in some cases, less) regulation.
As for the rest of your arguments... There is utility in specialization. Working class people don't generally have the time or inclination to identify trends and predict future needs, and will frequently have the interest to protect their lives from change even when it's not in "the people's" overall interest.
Generally, people make decisions - "the People" are not able to make decisions without some sort of social structure - rules, contracts, conventions, traditions - that enable them to cooperate.
I won't argue about uneven distribution of wealth - it certainly exists, and is a problem. But the idea of having the "working class" make all decisions about how capital will flow - I don't even understand it as a coherent idea. Will companies have managers and CEOs? How will decisions actually be made - that is, how do you decide to expand a factory and buy a new machine from some other company, or when do you just fix the old one you already have and make do? What about credit and money - what are you proposing to do about that?
And what about freeloaders - if the fruits are evenly distributed, I might be a cynic but I think most people will take it easy.
Have you really thought this through - do you have anything to say that hasn't been suggested and tried in the past?
Look into the history of China - Mao was a great military leader but basically a pretty simple man in other ways, and screwed up so badly it cost millions of lives. China has only begun to recover some hint of it's former greatness now that market economies are encouraged, and social and individual incentives are beginning to be aligned.
Fairness is an innate human feeling, but shit - you're not cold or hungry, are you?
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