🔥 This is why I oppose making things public institutions.


  • Grade A Premium Asshole

    @jmp said:

    You want to live in a world where an ordinary worker's investments + any pension out-earn what they had when they were actually working, at all points in their working life? How do you think that could possibly function? I'm not sure you can actually get that without some asset ballooning in value ridiculously over several decades - like real estate has.

    You...are one of the people who pays it...


  • Grade A Premium Asshole

    @jmp said:

    In order to earn $100,000/year from your assets, well you're going to need a lot of assets. $2 million dollars at 5% interest would do it, for example. Lets say you've been earning $100,000 for a long time and save half of it each year, and reinvest the 5% interest. How long would it take you to have $2 million in assets?

    Well...if you are only earning 5%, you need to learn what an index fund is. If you lunk $50K/year in to investments it takes you 16 years to reach $2M, and you could siphon off $140K/year at that point without touching your base and your investments (and income) would tend to keep increasing at the rate of inflation.


  • Grade A Premium Asshole

    @flabdablet said:

    Conservative economic logic goes like this:

    I am doing well. Those people complaining about not doing well are not doing the same things as I am. Therefore, all that needs to happen is for those feckless pricks to man up and do what I am doing. Then everything will be just fine! In a land of opportunity, everybody gets what they deserve! Personal Responsibility! Also Free Speech!

    You can put it more succinctly than that: "If you do what rich people do long enough, you get to be a rich person. If you do what poor people do, you get to be a poor person." Two sentences will cover it.

    It is also correct.


  • Grade A Premium Asshole

    @blek said:

    Well, thanks for illustrating the raging retard point of view, I guess. It seems unnecessary, though, given that there's plenty of that in the original article.

    I just call it the @flabdablet POV on UBI.

    Toe-may-toe, toe-mah-toe.



  • Seems irrelevant to a government operation like Social Security, which no private firm could legally get away with.

    Are you kidding me?

    From the financial times (http://www.ft.com/cms/s/1/a0b83494-a535-11d9-8616-00000e2511c8.html#axzz42RnKnk6X):

    The implication of the Modigliani-Miller theorem for US Social Security reform is that the total amount of future wealth available to fund retirement does not depend on how George W. Bush, the president, chooses to finance future retirement. That is, whether the government invests on future retirees' behalf (the current system) or people invest for themselves in personal security accounts (the proposed system) cannot affect the overall return on investment in the economy.

    Of course, people might make different financing choices under a PSA system than the government makes for them in the Social Security system. But these choices do not affect the total amount of resources available to fund retirees. That depends on economic growth in the interim which, according to Messrs Modigliani and Miller, does not depend on how that growth is financed.

    Since the capital structure of the firm is irrelevant, it is not the problem. The problem is demographic.


  • ♿ (Parody)

    @Captain said:

    Since the capital structure of the firm is irrelevant, it is not the problem. The problem is demographic.

    Sure, just like any other Ponzi scheme. So long as you have enough new suckers you have no problem.



  • are you secretly Dave Ramsey?


  • Grade A Premium Asshole

    Ha! No. But I was taught a lot of what he espouses long before I found him. He is a pretty alright guy...for as religious as he is. ;)



  • Man, it's almost like I specifically said UBI is expensive!

    As it happens, it's not too far off. Total welfare spend ~$105 billion, population 24 million, ~$4360/year. ~a quarter of what unemployment benefits pay if you include rent assistance. Might be slightly more, the budget website claims $146 billion of welfare spending and an inflammatory article in a tabloid claims $160 billion. The number I'm using is from an editorial in the national broadcaster, and is just welfare payments, that might be where the difference lies. You should be able to feed yourself on ~$4360, but that's about all you'd be doing with it. No roof, no clothes, no bathing, etc.. Our GDP is about $1.5 trillion, giving everyone an unemployment-benefit-plus-rent-assistance equivalent payment would cost ~384 billion, so about 25% of our GDP. Very big, but not completely and utterly ridiculous for all time. In a couple of decades economic growth alone might make that plausible. And I think the negative-income-tax variant is supposed to be cheaper.

    I'm not saying "UBI is amazing let's switch now!". I'm saying it's an interesting idea that's worth considering carefully. Yes, taxes would have to increase if we did it now, maybe, not sure how the NIT model affects things.

    EDIT: For reference, total tax burden in Australia is ~26% of GDP. It'd take our tax burden into Denmark/Finland/Sweden territory, assuming no significant changes to other areas of government expenditure and that there's no significant effect on GDP.



  • @Polygeekery said:

    You...are one of the people who pays it...

    Of course, I'm too young to have bought property when it was cheap. 😛 .


  • ♿ (Parody)

    @Captain said:

    >The implication of the Modigliani-Miller theorem for US Social Security reform is that the total amount of future wealth available to fund retirement does not depend on how George W. Bush, the president, chooses to finance future retirement. That is, whether the government invests on future retirees' behalf (the current system) or people invest for themselves in personal security accounts (the proposed system) cannot affect the overall return on investment in the economy.

    Reading this statement a little closer, it's bullshit, too, at least as a defense of Social Security. OK, maybe choosing one way of financing a public pension system doesn't change overall investment, but that seems to be assuming that money put into private sector investments (like through an IRA or 401(k)) has the same benefit as handing over the cash to the government and letting them blow the cash on whatever (well, we're into Social Security deficits now, so it's all transfer payments). That seems dubious to me.

    But even accepting that, you're equating the overall "return on investment in the economy" with the government program that is Social Security. Most of that ROI most certainly doesn't and shouldn't be feeding Social Security.

    And if you want to go to PSAs, you have to start way ahead of time, as opposed to a Ponzi scheme like Social Security which can start paying out as soon as people start paying in. And saying that "the capital structure of the firm is irrelevant" is irrelevant to this discussion because there is no firm and there's a massive difference between a Ponzi scheme and something backed with actual assets.



  • @xaade said:

    My daughter made mud pies, should she get a basic income?

    In that age bracket the basic income is traditionally called "pocket money" (and normally has free room and board thrown in, which is effectively a basic income in itself).

    Unless your daughter was making mud pies in her mid-20s, in which case I'd say "No, tell her to stop mucking around and get a job."

    @Captain said:

    No, it's like saying, "My airplane doesn't fly anymore because of all the extra CO2 in the air."

    You just have to blame global warming for it, then it's not your fault.

    @xaade said:

    Do you care where your banana is bought from?

    Some people do. That's why we have country of origin labelling. Also, promotion of "organic", "free range", etc.



  • @anotherusername said:

    artificial

    This word literally means "made by humans", so yes. It is artificial scarcity. Unless you're saying that Product X is purchased by non-humans.



  • @Polygeekery said:

    You can put it more succinctly than that: "If you do what rich people do long enough, you get to be a rich person. If you do what poor people do, you get to be a poor person." Two sentences will cover it.

    It is also correct.

    The really sad thing is the number of people who continue to believe that, despite all evidence to the contrary. Faith is a mysterious thing.



  • Unless you're talking about some form of career discrimination.

    If you make literally the same investments at the same time, with the same starting amount, you'll end up in the same place.

    So there are areas where this holds to be exactly true.

    In all other areas, it's simply offset. Sometimes its offset so much that you can't end up in the same place. (belonging to a different culture as the group you're trying to associate with will be a disadvantage).

    But generally speaking, the statement is true.

    Now will you end up as rich as a person starting from a different position? No. But in what world would you expect that?



  • @xaade said:

    If you make literally the same investments at the same time, with the same starting amount, you'll end up in the same place.

    The trick to being rich: start with money in the first place.



  • What evidence? The millions of entrepreneurs who start their own businesses, save and invest, putting off consumption ? Living like no one else now so later they can live like no one else?

    If anything its the faith that somehow government makes things better for the poor, despite all the evidence to the contrary (most recently, Venezuela).



  • Mmmhm. Pull the other one it has bells on.


  • ♿ (Parody)

    @NTW said:

    What evidence?

    @flabdablet's ideas are different than what all those guys did before. It's a sure thing this time.



  • @ben_lubar said:

    @anotherusername said:
    artificial

    This word literally means "made by humans", so yes. It is artificial scarcity. Unless you're saying that Product X is purchased by non-humans.

    Not in this context, it doesn't.

    Words can mean more than one thing, in case you weren't aware.


  • Discourse touched me in a no-no place

    @NTW said:

    Mmmhm. Pull the other one it has bells on.

    The best evidence that we've got indicates that the most probable indicator for someone being rich at time X is that they were rich at some point earlier (X-Y). It's not a 100% accurate indicator, of course, but it's a really good starting point.

    Whether you like this situation is a different thing altogether.



  • That's not necessarily true.

    We've had plenty of people ruin their parent's wealth.
    We've had plenty of people start from nothing.

    There are so many millionaires that became poor at some point in their life, and rebuilt their fortune, because they knew how to get rich.



  • @NTW said:

    Living like no one else now so later they can live like no one else?

    That's the key.

    Earlier when I said putting away half your money is possible. It absolutely is. That's what people who get rich, do.

    It's not realistic because we've grown up being taught that we can have it all and we should and we deserve to have it all. We been taught that we deserve to live off of the most of our means and still end up wealthy. And we've been taught that if it doesn't end up that way, then it's someone else's fault.


  • Considered Harmful

    @xaade said:

    Well, the problem is, even if there is no scarcity, if there is no exchange of goods for the work being done, then certain forms of goods cannot exist.
    That can count as falsified by the large amount of great art that was created without any exchange of goods.

    If there was no scarcity. I could grab anything I wanted at any time. Yet, I used that time to produce a work of art. And it was copied and there was no exchange of goods for that production. Then either art will be reserved to disposable time only (hobby), or not exist as a good for another reason.
    I suppose most artists would tell you their reason for creating art is a desire to do so. I do know a few artists but none of them had noticed they need something to pay the bills and *then* became an artist for that reason.
    Even when you have no scarcity, collection and refinement of the goods you need is your job. And there is opportunity cost on time spent doing so.
    "Cost" in the sense of "time is money" maybe.
    The only other alternative I can think of, is for the public to freely subsidize the production of art. Which means, donations or taxes.
    Certainly an important one even if not the only. But don't restrict it just to art in a conventional sense. The same goes for the stuff most of us produce: code. And advancing automation makes it more and more of a possibility in other areas of production. Edit: and in ones like pharma we're basically there, too.


  • @LaoC said:

    I suppose most artists would tell you their reason for creating art is a desire to do so. I do know a few artists but none of them had noticed they need something to pay the bills and then became an artist for that reason.

    That fits under "disposable time" / "hobby". Even if they are making personal sacrifices to do so.

    I could certainly earn more money if I gave up some of my time to more work.

    Said person is either being subsidized, eventually earns money on their work, or they have to stop and work at some point, or they starve.

    Scarcity or lack therefore doesn't eliminate the exchange of goods.



  • But even accepting that, you're equating the overall "return on investment in the economy" with the government program that is Social Security. Most of that ROI most certainly doesn't and shouldn't be feeding Social Security.

    It needs to be feeding retirements, which is exactly what Social Security is for. So the point of the Miller-Modigliani reference is that it doesn't matter how people save, if they save enough.

    If you put $100 a month into your IRA, and that's all you do, you're not going to have enough for retirement. And it's not because of the capital structure of your investment. It's because there just isn't enough money in the account to finance your retirement.

    People don't want to save, and then want to burden their children when it's time to retire.

    Social Security is a Ponzi scheme in the same way that the stock market is -- it isn't. There is nothing inherently fraudulent about it. But now we're in a situation where people didn't save enough for retirement, and feel entitled to retirement. But it's a Catch 22. People would have bitched and moaned for decades about their Social Security payments if they had to pay more in. But they would rather consume than save.

    It's just Stokes theorem. If money goes out, it has to go in first. And if money is going out faster than it is coming in, the volume of money will go down. And in fact, we can predict that the net present value of the Social Security fund is negative now, by huge amounts, because of what it will take to finance the Boomer's retirements (since they didn't do it for themselves).

    Which ties in to what I said about value, earlier. Your time, my time, our kids' time is limited. And if we want to build the things that we want, and invest in our futures, we need to get rid of the weight around our necks eating up any chance of getting a production surplus. The Boomers are a weight around our necks, dragging us into a service economy, since they're unwilling to do anything for themselves. They think throwing a dollar at somebody to get what they want is enough of a contribution to society. It isn't.

    A service economy diverts resources from production of time-saving capital (in the business and "personal" senses) to consumption. I don't want to trade my time for dollars or glass beads. I want to trade my time for value, and the Boomers have very little of that to give.



  • @Captain said:

    Social Security is a Ponzi scheme in the same way that the stock market is

    What? The two aren't comparable.

    You're not selling your stocks when you retire, you're capitalizing on the interest earned. If they use stocks to build interest for social security, that's abstracted away and it doesn't matter to your model.

    Except, that's not what's happening.

    In an investment scheme, you earn money by selling off something that has value with the buyer hoping it gains more value. But while invested, you hold something of value. In social security you hold an IOU that has no value, there's no demand for that IOU.

    What's happening is that every person who wants to retire, pays the previous person's retirement now, hoping that someone else pays their retirement in the future, and that's more like a Ponzi scheme than it is like an investment one. In social security, your money isn't buying you anything to sell off. It's buying an IOU from the government that someone else's money will buy from the government to pay off your IOU. When I retire, the social security money I've paid no longer has value, that value has been used, so I have to take value from someone else.

    This is basically Ponzi bonds.

    @Captain said:

    People would have bitched and moaned for decades about their Social Security payments if they had to pay more in

    Because they don't get anything for it.
    They get the opportunity to capitalize on someone else losing value.
    Paying into social security inherently has no value.
    It's more like hedging than investing, but instead of hedging on stock, you're hedging on population growth, and quick deaths.

    In social security, everyone that dies before they retire is a win for you.



  • Because they don't get anything for it.

    What the fuck are you talking about? They get a perpetuity out of it.



  • Not if they die early.

    There's no social security for an estate.

    It literally has less value than fiat money.



  • Yeah, so it's a pension... what's your point? Lots and lots of pensions are unfunded because of the demographic crisis. Public versus private has nothing to do with people not saving enough for their retirements.

    Also, you don't know what hedging is...



  • Because the government is forcing me to invest in a pension.

    It's stupid.

    Give me my money, and let me invest it.



  • That's nice and all, but the Boomers still had the option to save more than their Social Security contributions, and didn't. Now they're broke, and it's because they didn't save enough -- not because of Social Security.



  • And that's reason enough to perpetuate a stupid system?



  • What's the alternative? Death camps?

    Social Security will be fine once the demographic and savings crises are over. Because it is the demographic crisis that is the problem.



  • @Captain said:

    Also, you don't know what hedging is...

    Yes I do.

    Social security is a fund, that tries to hedge and reduce risk by betting that the population does not decrease or people die before retiring.

    Just because the hedge is a stupid one, doesn't mean it isn't a hedge.



  • No, you don't. But you're boring and opinionated, so I'm disengaging.



  • @Captain said:

    What's the alternative? Death camps?

    It's "Death camps" to expect people to save or work past retirement age?

    Then, it's already "Death camps" because by the time I try to retire, I won't get social security unless I work until 80. You're hitting the death age at that point.

    @Captain said:

    Because it is the demographic crisis that is the problem.

    Plus every time they pulled funds for earmarks.



  • It's "Death camps" to expect people to save or work past retirement age?

    Have you been reading what I've been saying? PEOPLE HAVEN'T SAVED ENOUGH.

    IT'S TOO LATE FOR THEM TO SAVE. SO NOW THEY ARE EITHER A BURDEN OR THEY DIE.



  • @Captain said:

    No, you don't. But you're boring and opinionated, so I'm disengaging.

    A hedge is an investment to reduce the risk of adverse price movements in an asset. Normally, a hedge consists of taking an offsetting position in a related security, such as a futures contract.

    Social security hedges by relying on population growth or early death to offset inflation.

    It doesn't even have an asset because of the money flow.



  • That's not a hedge.



  • @Captain said:

    Have you been reading what I've been saying? PEOPLE HAVEN'T SAVED ENOUGH.

    IT'S TOO LATE FOR THEM TO SAVE. SO NOW THEY ARE EITHER A BURDEN OR THEY DIE.

    Or you personally give a shit and pay their bills.

    I'm sorry, taxes aren't for babysitting.



  • Or you personally give a shit and pay their bills.

    YES, THEY ARE A BURDEN.

    YOU'RE STARTING TO GET IT. IT'S THE PEOPLE THAT IS THE PROBLEM, NOT WHICH BANK ACCOUNT THEY PUT THEIR MONEY IN.



  • @Captain said:

    YES, THEY ARE A BURDEN.

    They are only a burden if you believe it's the government's responsibility to ensure no one fails.

    It's your fundamental liberal welfare mentality that makes them a burden.


    I mean, I somewhat agree to scenarios where people have no opportunity, like a kid in a ghetto without parents to raise them. I'm all for increasing opportunities.

    But now you're babysitting people who had opportunity... and chose not to take it.

    Government is not a charity.



  • They are only a burden if you believe it's the government's responsibility to ensure no one fails.

    YES I AGREE THAT THEY SHOULD DIE ON THE STREETS. BECAUSE THEY MADE THE MESS AND EXPECT THEIR CHILDREN TO FIX IT.

    THEY SHOULD GET FUCKED.

    But realistically, they are a bigger voting block and will continue to fuck us for the rest of our lives.



  • @Captain said:

    YES I AGREE THAT THEY SHOULD DIE ON THE STREETS. BECAUSE THEY MADE THE MESS AND EXPECT THEIR CHILDREN TO FIX IT.

    Then, that's what you support. Ending social security. Just like me.

    Maybe Bernie can just take the funds for free college out of social security until it just becomes another tax.



  • Not at all. Social Security isn't the problem. It's the people who didn't save enough, on a massive scale. And they would have saved less if there was no Social Security.

    PEOPLE WANT TO CONSUME. THEY WANT EVERYTHING NOW.


  • ♿ (Parody)

    @Captain said:

    It needs to be feeding retirements, which is exactly what Social Security is for. So the point of the Miller-Modigliani reference is that it doesn't matter how people save, if they save enough.

    :facepalm: No one is saving anything with Social Security. Period. There is nothing about it that can be described as "savings" or "investment."

    @Captain said:

    Social Security is a Ponzi scheme in the same way that the stock market is -- it isn't.

    You either don't understand Ponzi schemes or don't understand Social Security.



  • @Captain said:

    PEOPLE WANT TO CONSUME. THEY WANT EVERYTHING NOW.

    That's Welfare.

    They want to solve every problem now, with more taxes.

    @Captain said:

    Social Security isn't the problem. It's the people who didn't save enough

    Now you're just deflecting.

    You've created a system that is heavily dependent on population growth, and when it fails you blame people for not saving, but insist the system should exist.

    If people saved adequately, social security would not exist.

    Therefore, end social security. It serves no purpose other than to fuck us over when population growth misbehaves.


  • ♿ (Parody)

    @Captain said:

    Yeah, so it's a pension... what's your point? Lots and lots of pensions are unfunded because of the demographic crisis. Public versus private has nothing to do with people not saving enough for their retirements.

    Except that a typical pension fund actually invests in stuff in order to have a fund to pay out pensions. Don't insult underfunded pension funds by comparing them with Social Security.



  • @boomzilla said:

    No one is saving anything with Social Security. Period. There is nothing about it that can be described as "savings" or "investment."

    They're getting a fiat money that's worse than fiat money, because it's performance is reliant on population growth.

    Not GDP, not anything of value to any other entity in the world.

    Having more people doesn't make value.


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