PCT Economics (Re: Evolution)

rsmarken · November 7, 2010, 4:23pm

[From Rick Marken (2010.11.07.0820)]

Shannon Williams (2010.11.06.2200 CST)

I have an idea. I want to sell it to you, and then maybe using PCT,

we can identify the roadblocks to selling it to others. It should be

an easier sell than PCT itself.

The idea originates in Rick’s argument (based on data) that the

economy seems to perform better when taxes are higher.

The data I presented only showed that there was no evidence that taxes are recessionary. The data were correlations between time variations in top marginal tax rate, growth rate and unemployment rate. Here are some of the main results:

Correlation between annual growth rate (dGDP/dt) and Top Marginal Tax (TMT) rate for the years 1929-2008: .30
Lagged correlation between dGDPdt and TMT (TMT leads dGDP/dt by one year): .34

Correlation between annual unemployment rate (UR) and TMT for the years 1947-2008: -.23

Lagged correlation between UR and TMT (TMT Leads dGDP/dt by one year): -.17

Note that these results are for the Top marginal tax rate. I also have data for the Marginal Tax rate, which I presume is the middle class tax rate. The results are similar but not as pronounced.

As was pointed out in the earlier discussion of these data, these results don’t show that increases in marginal tax rate increase growth and decrease unemployment. Correlation does not imply causality and the correlations are pretty low anyway. In order to understand the relationship between taxes, growth and unemployment you would need a model of the economy that produces results that match the observed fluctuations in these variables. All my data show is that economists have no basis for saying (as they all do) that taxing the rich is recessionary or that not taxing the rich will reduce unemployment.

The data

baffled me, but now the reason is stupidly obvious to me. Most

people (on this list at least) believe that if the rich people go out

and spend their money (invest etc) that the stock market does better,

and companies generate more jobs, and so the economy does better.

Well, the same thing happens if you take the money from the ‘rich’ and

design public works which give companies more income (or if you just

directly create more government jobs).

This isn’t quite how I see it. I think the problem created by maldistribution of wealth is it reduces the aggregate consumer’s demand for the goods and services it is producing for itself as the aggregate producer. This requires that the aggregate producer reduce production to match the reduced demand, resulting in increased unemployment and production capability that is lower than what the economy is capable of. Maldistribution of wealth presumably does this because the super rich have so much money they can’t use it all for consumption so it basically goes out of circulation. Taxing the rich would then work somewhat as you say; the government takes that unused money and redistributes it to the aggregate consumer (in the form of unemployment, jobs programs, etc) which brings consumer demand back up and helps the economy become more efficient.

My ‘solution’ that I would submit to my congressmen is a guideline.

When the economy is in trouble don’t try to ‘stimulate spending’. Try

to inhibit savings. Think in terms of ‘use it or lose it’. On the

surface this might look like higher taxes. Sure. Hike the income tax

up to 90% on the super rich- but give them plenty of spending and

investment loopholes so that their actual tax rate is only 33%. Or tax

people at a flat 20% but impose non-spending penalties. There are

many different ways to spin it around people’s reference points.

Any thoughts?

I think there are many economists who now see that maldistribution of wealth is a huge problem, especially now that we are at maldistribition levels that equal of exceed those that existed in 1929. I think they also understand that taxing and spending is the way to solve the problem. But I think the “taxes are recessionary” meme is so much a part of economic wisdom now that it would be impossible so get many economists to argue for doubling the the marginal tax rate, as FDR did at the height of the depression.

Best

Rick

···

–
Richard S. Marken PhD
rsmarken@gmail.com
www.mindreadings.com

Shannon_Williams · November 7, 2010, 8:07pm

from Shannon Williams (2010.11.07.1300 CST)

[From Rick Marken (2010.11.07.0820)]

The data I presented only showed that there was no evidence that taxes are
recessionary. The data were correlations between time variations in top
marginal tax rate, growth rate and unemployment rate. Here are some of the
main results:

Cool. Thank you. Do you have any of the numbers online? Or maybe a
graph showing annual growth rate versus Marginal tax rates?

I think the problem created by
maldistribution of wealth ...
Maldistribution of wealth presumably does this because the super rich have
so much money they can't use it all for consumption so it basically goes out
of circulation.

So the key to keeping the economy strong is: we can't let the money go
out of circulation. That is the key. I disagree with you that
distribution of wealth in and of itself is relevant to the health of
the economy. I know that Martin L. also disagrees that distribution
of wealth is relevant to the health of the economy. But I do believe
that with the correct songs, Martin could develop the references which
allow him to see that people like Matt Damon are killing the economy.
(Matt Damon bragged that he has $24 million just sitting in various
bank accounts).

I believe that we can get the most Tea Party extremist as well as the
most liberal extremist to develop this reference. Rick will have a
different 'reason' than Martin L. for maintining this perception. But
as long as they are both struggling to maintain it, we can get people
educated and elected who can actually expertly stimulate the economy.

When the economy is in trouble don't try to 'stimulate spending'. ï¿½Try
to inhibit savings. ï¿½Think in terms of 'use it or lose it'.

Note to BP: I know this is not PCT per se. But it is real important.
My family is ripped at the seams. The county is ripped over this
issue. This is the only list that I know of where people can begin to
see workable answers.

Thanks,
Shannon

Shannon_Williams · November 7, 2010, 8:12pm

From Shannon Williams (2010.11.07.1300 CST)

[From Rick Marken (2010.11.07.0820)]

The data I presented only showed that there was no evidence that taxes are
recessionary. The data were correlations between time variations in top
marginal tax rate, growth rate and unemployment rate. Here are some of the
main results:

Cool. ï¿½Thank you. ï¿½Do you have any of the numbers online? ï¿½Or maybe a
graph showing annual growth rate versus Marginal tax rates?

I think the problem created by
maldistribution of wealth ...
Maldistribution of wealth presumably does this because the super rich have
so much money they can't use it all for consumption so it basically goes out
of circulation.

So the key to keeping the economy strong is: we can't let the money go
out of circulation. ï¿½That is the key. ï¿½I disagree with you that
distribution of wealth in and of itself is relevant to the health of
the economy. ï¿½ I know that Martin L. also disagrees that distribution
of wealth is relevant to the health of the economy. ï¿½But I do believe
that with the correct songs, Martin could develop the references which
allow him to see that people like Matt Damon are killing the economy.
(Matt Damon bragged that he has $24 million just sitting in various
bank accounts).

I believe that we can get the most Tea Party extremist as well as the
most liberal extremist to develop this reference. ï¿½ Rick will have a
different 'reason' than Martin L. for maintining this perception. ï¿½But
as long as they are both struggling to maintain it, we can get people
educated and elected who can actually expertly stimulate the economy.

When the economy is in trouble don't try to 'stimulate spending'. ï¿½Try
to inhibit savings. ï¿½Think in terms of 'use it or lose it'.

Note to BP: ï¿½I know this is not PCT per se. ï¿½But it is real important.
ï¿½My family is ripped at the seams. ï¿½The county is ripped over this
issue. ï¿½This is the only list that I know of where people can begin to
see workable answers.

Thanks,
Shannon

···

On Sun, Nov 7, 2010 at 2:07 PM, Shannon Williams <verbingle@gmail.com> wrote:

Martin_Lewitt · November 7, 2010, 11:21pm

[Martin Lewitt Nov 7 1444 MST]

> From Shannon Williams (2010.11.07.1300 CST)

[From Rick Marken (2010.11.07.0820)]

The data I presented only showed that there was no evidence that taxes are
recessionary. The data were correlations between time variations in top
marginal tax rate, growth rate and unemployment rate. Here are some of the
main results:

Cool. Thank you. Do you have any of the numbers online? Or maybe a
graph showing annual growth rate versus Marginal tax rates?

I think the problem created by
maldistribution of wealth ...
Maldistribution of wealth presumably does this because the super rich have
so much money they can't use it all for consumption so it basically goes out
of circulation.

So the key to keeping the economy strong is: we can't let the money go
out of circulation. That is the key. I disagree with you that
distribution of wealth in and of itself is relevant to the health of
the economy. I know that Martin L. also disagrees that distribution
of wealth is relevant to the health of the economy. But I do believe
that with the correct songs, Martin could develop the references which
allow him to see that people like Matt Damon are killing the economy.
(Matt Damon bragged that he has $24 million just sitting in various
bank accounts).

Technically, money sitting in bank accounts is still being employed, in this case by the banks. I wouldn't even categorize what Matt Damon is doing as "greed". "Greed" is the hoarding of wealth without employing it, so in that sense, what the government is doing hoarding rather than employing the oil wealth in Anwar is a better exemplary of greed.

Even the hoarding of paper money may no longer have much of the negative effects of greed, since it is easily compensated for by the central banks which usually will hit their targets of 1.5% to 3% increase in money supply despite a missing paper hoard. I view the hoarding of gold differently, because even though the purchaser has put money into the economy, he is supporting the price of gold, and an economy that is putting more resources into gold is not engaged in a very productive enterprise, since there are few industrial uses for gold at current prices.

I believe that we can get the most Tea Party extremist as well as the
most liberal extremist to develop this reference. Rick will have a
different 'reason' than Martin L. for maintining this perception. But
as long as they are both struggling to maintain it, we can get people
educated and elected who can actually expertly stimulate the economy.

When the economy is in trouble don't try to 'stimulate spending'. Try
to inhibit savings. Think in terms of 'use it or lose it'.

Low interest rates definitely inhibit savings and the US was being roundly criticized for its low savings rate during the bubble that led up to the crisis. Inflation inhibits savings as well, as the US consumer responded to the low interest rates, by a borrow and spend now while the dollar is still worth something attitude. However, savings rates in the rest of the world were still high despite the low returns and what investment money there was, was increasingly invested in riskier and more speculative instruments and enterprises in the scramble for any worthwhile returns at all. It did not help that returns were reduced by the double taxation of dividends and capital gains, or that speculation and risk were encouraged by a tax policy which advantaged debt by only taxing interest once.

The federal reserve did not have the tools it needed to respond to the deflationary collapse of the pyramid of debt. It could purchase all the US securities it wanted and lenders weren't going to lend, nor borrowers borrow in the face of a financial crisis and recessions. The fed could have stemmed the spread of the crisis from wall street to main street if it had created money directly into the hands of consumers instead of hoping they would continue borrowing. That policy might still be the best strategy now, although it would have to be more cautious since it is more difficult to get hiring going than it is to keep layoffs from happening. Forcing the fed to create money in this matter should appeal to conservatives, since the money supply targets would be the same, and it would give complete transparency to the feds operations,since everyone would know how much money was being created. It should also appeal to the non-marxist elements of the Democratic party because it is both populist and redistributionist, since everyone gets the benefit of money creation, but it is the wealthy that hold most of the dollar denominated assets that will be losing value from inflation.

Martin L.

···

On 11/7/2010 1:07 PM, Shannon Williams wrote:

Note to BP: I know this is not PCT per se. But it is real important.
My family is ripped at the seams. The county is ripped over this
issue. This is the only list that I know of where people can begin to
see workable answers.

Thanks,
Shannon

rsmarken · November 8, 2010, 4:29am

[From Rick Marken (2010.11.07.0830)]

Shannon Williams (2010.11.07.1300 CST)

Rick Marken (2010.11.07.0820)]

The data I presented only showed that there was no evidence that taxes are

recessionary…

Cool. Thank you. Do you have any of the numbers online? Or maybe a

graph showing annual growth rate versus Marginal tax rates?

I can make these for you when I get a chance. None on line yet.

So the key to keeping the economy strong is: we can’t let the money go

out of circulation. That is the key.

Not quite. It’s the aggregate consumer returning all the income (wages and profits) is received from itself as the aggregate producer. You can read a description of my ideas about this in my paper http://www.mindreadings.com/HMod.pdf that’s is online.

Note to BP: I know this is not PCT per se.

I think it is PCT (I think you will see why after reading my paper). I really think economics is control “writ large” (at the population level).

Best

Rick

···

–
Richard S. Marken PhD
rsmarken@gmail.com
www.mindreadings.com

Shannon_Williams · November 8, 2010, 12:12pm

from Shannon Williams (2010.11.07.2000 CST)

ï¿½[Martin Lewitt Nov 7 1444 MST]

Technically, money sitting in bank accounts is still being employed, in this
case by the banks.

How about practically? Practically speaking how do you compare the
use of money in banks to the use of direct investments? For example,
money directly invested in a company flows throw the company and out
to new equipement and/or new employees. When the company folds
within the next five years, as it probably will, the money that
trickled through it is still in the society. When a bank loans the
money, the money does not trickle. It may surge forward to build a
house, but it retreats back to the bank. In fact, when it returns to
the bank, it sucks even more of itself back. Until this newly sucked
money is spent, there is even less money circulating in society that
there was before (unless the government steps in and prints money).
Do you agree so far?

Sincerely,
Shannon

Shannon_Williams · November 8, 2010, 12:26pm

from Shannon Williams (2010.11.08.0630 CST)

Cool. ï¿½Thank you. ï¿½Do you have any of the numbers online? ï¿½Or maybe a
graph showing annual growth rate versus Marginal tax rates?

I can make these for you when I get a chance. None on line yet.

Sweet! That would be cool because then we can use the data in news
paper editorials etc.

So the key to keeping the economy strong is: we can't let the money go
out of circulation. ï¿½That is the key.

Not quite. It's the aggregate consumer returning all the income (wages and
profits) is received from itself as the aggregate producer. You can read a
description of my ideas about this in my paper

As I note in our private message, if fixing the leakage fixed the
Economy problem, would you still fight for redistribution of wealth as
a means to fix the Economy problem? Or would you be satisfied?

Sincerely,
Shannon

Martin_Lewitt · November 8, 2010, 12:33pm

[Martin Lewitt Nov 8, 2010 0515 MST]

> From Shannon Williams (2010.11.07.2000 CST)

[Martin Lewitt Nov 7 1444 MST]

Technically, money sitting in bank accounts is still being employed, in this
case by the banks.

How about practically? Practically speaking how do you compare the
use of money in banks to the use of direct investments? For example,
money directly invested in a company flows throw the company and out
to new equipement and/or new employees. When the company folds
within the next five years, as it probably will, the money that
trickled through it is still in the society. When a bank loans the
money, the money does not trickle. It may surge forward to build a
house, but it retreats back to the bank. In fact, when it returns to
the bank, it sucks even more of itself back. Until this newly sucked
money is spent, there is even less money circulating in society that
there was before (unless the government steps in and prints money).
Do you agree so far?

In fractional reserve banking several times the deposited money is loaned out. Most of the money supply is actually created this way. When the deposited money is loaned out, those loans become assets can be considered reserves, allowing even more money to be loaned, and those loans too become assets. In ordinary times, when debt payments come in, the banks quickly put it to work loaning it out again. So a large part of the money supply is built upon a pyramid of debt. When part of that debt goes bad there is a collapse of part of the pyramid. When the federal government borrowed money to issue "stimulus" checks to the public back in 2008, some of that stimulus money was used by consumers to pay down debt. Since that reduction in consumer debt had a cascade effect on the pyramid of debt, it was concluded that the "stimulus" was actually deflationary.

By requiring the federal reserve to issue newly created money to the people, the federal reserve will no longer need to convince banks and consumers to re-create the pyramid of debt in order to create money. Fractional reserve banking can be reigned in with higher reserve requirements. If the consumers decide to pay down debt instead of spend the money, that deflationary effect would just allow the fed to issue more money to the people, and the net result will be a less indebted public. Instead of controlling interest rates the federal reserve can allow the market to determine the rates, so that real returns might incent Americans to actually save and invest again.

Companies and and their employees would be better off with equity rather than debt financing, but Democrats have chose to double tax equity financing.

Martin L

···

On 11/8/2010 5:12 AM, Shannon Williams wrote:

Sincerely,
Shannon

Shannon_Williams · November 8, 2010, 3:04pm

[From Shannon Williams (2010.11.08.0900 CST)]

By requiring the federal reserve to issue newly created money to the people,
the federal reserve will no longer need to convince banks and consumers to
re-create the pyramid of debt in order to create money.

What mechanism are you thinking of here? I assume that you are not
thinking that the Federal reserve would just send checks directly to
whoever was in debt. How are you thinking to issue newly created
money to the people?

Sincerely,
Shannon

chadtgreen · November 8, 2010, 4:24pm

Shannon,

This paragraph of yours caught my attention:

"As I note in our private message, if fixing the leakage fixed the
Economy problem, would you still fight for redistribution of wealth as
a means to fix the Economy problem? Or would you be satisfied?"

To fix this "economy problem" I think we're going to need to completely rethink and reinvent government as we know it. It should be increasingly clear to everyone that the historical pattern of resource distribution among nations is not only unsustainable, inequitable, and amoral, but it also is self-destructive, self-serving, and illogical (in the intuitionistic sense).

Has anyone heard of the notion of the "Singularity" with respect to artificial intelligence (i.e., when superhuman intelligence is attained)? Well folks, I'm afraid to say it, but the joke is on us. Human intelligence has become so artificial, so out of synch with the laws of nature, that I'm afraid our behavior simply cannot get any more inane than it has already become. In short, the Singularity is now.

Coincidentally, I'm in the process of releasing a new documentary on this topic entitled "Peak Reductionism: When Nature Calls." It's coming to a political theater near you.

But seriously, what would be a more innovative approach, with respect to the purpose of resource reallocation, that could replace this repeating cycle of unsustainable, self-destructive, and illogical behavior?

Chad

Chad Green, PMP
Program Analyst
Loudoun County Public Schools
21000 Education Court
Ashburn, VA 20148
Voice: 571-252-1486
Fax: 571-252-1633

Shannon Williams <verbingle@GMAIL.COM> 11/8/2010 7:26 AM >>>

from Shannon Williams (2010.11.08.0630 CST)

Cool. Thank you. Do you have any of the numbers online? Or maybe a
graph showing annual growth rate versus Marginal tax rates?

I can make these for you when I get a chance. None on line yet.

Sweet! That would be cool because then we can use the data in news
paper editorials etc.

So the key to keeping the economy strong is: we can't let the money go
out of circulation. That is the key.

Not quite. It's the aggregate consumer returning all the income (wages and
profits) is received from itself as the aggregate producer. You can read a
description of my ideas about this in my paper

As I note in our private message, if fixing the leakage fixed the
Economy problem, would you still fight for redistribution of wealth as
a means to fix the Economy problem? Or would you be satisfied?

Sincerely,
Shannon

rsmarken · November 8, 2010, 5:13pm

[From Rick Marken (2010.11.08.0920)]

Shannon Williams (2010.11.08.0630 CST)--

As I note in our private message, if fixing the leakage fixed the
Economy problem, would you still fight for redistribution of wealth as
a means to fix the Economy problem? Or would you be satisfied?

I've copied below a nice little OpEd from the LA Times that shows that
most people (even conservatives) would, indeed, like the wealth spread
better, even if it were not a cause of our economic woes.

This discussion of wealth inequality has really jolted some
interesting thoughts about the economy (at least I think they are
interesting). I'll post some of these thoughts when I get the time. In
the meantime, enjoy the article below.

Best

Rick

···

----

Spreading the wealth
The gap between rich and poor in the U.S. is bigger than at any time
since the 1920s. Is that really what most Americans want?

By Michael I. Norton and Dan Ariely

November 8, 2010

The gap between the wealthiest Americans and the poorest is bigger
than at any time since the 1920s ï¿½ just before the Depression.
According to an analysis this year by Edward Wolff of New York
University, the top 20% of wealthy individuals own about 85% of the
wealth, while the bottom 40% own very near 0%. Many in that bottom 40%
not only have no assets, they have negative net wealth.

A gap this pronounced raises the politically divisive question of
whether there is a need for wealth redistribution in the United
States. This central question underlies such hot-button issues as
whether the Bush tax cuts should be allowed to expire and whether the
government should provide more assistance to the poor. But before
those issues can be addressed, it's important to understand how
Americans feel about the country's increasing economic polarity.

We recently asked a representative sample of more than 5,000 Americans
(young and old, men and women, rich and poor, liberal and
conservative) to answer two questions. They first were asked to
estimate the current level of wealth inequality in the United States,
and then they were asked about what they saw as an ideal level of
wealth inequality.

In our survey, Americans drastically underestimated the current gap
between the very rich and the poor. The typical respondent believed
that the top 20% of Americans owned 60% of the wealth, and the bottom
40% owned 10%. They knew, in other words, that wealth in the United
States was not distributed equally, but were unaware of just how
unequal that distribution was.
Get the best in Southern California opinion journalism delivered to
your inbox with our Opinion L.A. newsletter. Sign up ï¿½

When we asked respondents to tell us what their ideal distribution of
wealth was, things got even more interesting: Americans wanted the top
20% to own just over 30% of the wealth, and the bottom 40% to own
about 25%. They still wanted the rich to be richer than the poor, but
they wanted the disparity to be much less extreme.

But was there consensus among Americans about their ideal country?
Importantly, the answer was an unequivocal "yes." While liberals and
the poor favored slightly more equal distributions than conservatives
and the wealthy, a large majority of every group we surveyed ï¿½ from
the poorest to the richest, from the most conservative to the most
liberal ï¿½ agreed that the current level of wealth inequality was too
high and wanted a more equitable distribution of wealth. In fact,
Americans reported wanting to live in a country that looks more like
Sweden than the United States.

So, if Americans say they want a country that is more equal than they
believe it to be, and they believe that the country is more equal than
it actually is, the question becomes how we lessen these disparities.
Our survey didn't ask what measures people would be willing to support
to address the wealth gap. But to achieve the ideal spelled out by
those surveyed, about 50% of the total wealth in the United States
would have to be taken from the top 20% and distributed to the
remaining 80%.

Few people would argue for an immediate redistribution of 50% of the
nation's wealth, and such a move would unquestionably create chaos. In
addition, despite the fact that individual Americans give large
amounts to charitable causes each year ï¿½ in effect, a way of
transferring wealth from the rich to the poor ï¿½ the notion of
government redistribution raises hackles among many constituencies.

Despite these reservations, our results suggest that policies that
increase inequality ï¿½ those that favor the wealthy, say, or that place
a greater burden on the poor ï¿½ are unlikely to reflect the desires of
Americans from across the political and economic spectrum. Rather,
they seem to favor policies that involve taking from the rich and
giving to the poor.

Michael I. Norton is an associate professor of business administration
at the Harvard Business School; Dan Ariely is the James B. Duke
Professor of Behavioral Economics at Duke University and the author of
"The Upside of Irrationality: The Unexpected Benefits of Defying Logic
at Work and at Home."

--
Richard S. Marken PhD
rsmarken@gmail.com
www.mindreadings.com

Martin_Lewitt · November 8, 2010, 10:26pm

[Martin Lewitt Nov 8, 2010 0310 MDT]

[From Shannon Williams (2010.11.08.0900 CST)]

By requiring the federal reserve to issue newly created money to the people,
the federal reserve will no longer need to convince banks and consumers to
re-create the pyramid of debt in order to create money.

What mechanism are you thinking of here? I assume that you are not
thinking that the Federal reserve would just send checks directly to
whoever was in debt. How are you thinking to issue newly created
money to the people?

Not tied to debt at all. My idea is that every man, woman and child has a debit card account into which the federal reserve can deposit money directly. The consumers decide how to best spend that money, whether it is on housing, to pay down debt, big screen TVs, taxes or whatever. That amount that does pay down debt, since it is deflationary, would allow the Fed to issue more money and still stay within its inflation and full employment targets, once again on an equal basis, regardless of who paid down debt. Consider $1.2 trillion would be $4000 for every man, woman and child, that would be $16,000 for a family of four, $20,000 for a family of five? Several times that has been spent on all the stimulus and rescue programs, do you think that families have seen that kind of benefit? The deposits in debit accounts would be in banking institutions but owned by the people, so instead of rescuing particular banks, the total deposit base of the system has been increased.

One concern i have is maintaining the relevance and importance of the debit card accounts in those years when the Federal Reserve might not need to create money to meet its targets. So I thought there might be a concession to the environmentalists, a totally revenue neutral tax on carbon, or heating oil and gasoline, sized to seed the debit card pipeline with a $500 credit every year. The conservatives could see it as justified by the externality costs of stabilizing and defending the Persian Gulf.

The current quantitative easing through the purchasing of treasuries, only benefits consumers very indirectly if at all. The benefits of newly created money goes to bondholders, banks and the government. I see no reason to prefer these over the citizens.

Martin L.

···

On 11/8/2010 8:04 AM, Shannon Williams wrote:

Sincerely,
Shannon

Martin_Lewitt · November 9, 2010, 12:34am

[Martin Lewitt Nov 8, 2010 1700 MST]

Shannon,

This paragraph of yours caught my attention:

"As I note in our private message, if fixing the leakage fixed the
Economy problem, would you still fight for redistribution of wealth as
a means to fix the Economy problem? Or would you be satisfied?"

To fix this "economy problem" I think we're going to need to completely rethink and reinvent government as we know it. It should be increasingly clear to everyone that the historical pattern of resource distribution among nations is not only unsustainable, inequitable, and amoral, but it also is self-destructive, self-serving, and illogical (in the intuitionistic sense).

Perhaps you shouldn't assume it is increasingly clear to everyone. Resources are constantly being redistributed among individuals, so there is a dynamic process, not a historical pattern. The idea that wealth was being created by capital and labor and not just static was recognized by Karl Marx, and you need look no farther than to contrast the resource poor Asian tigers with the resource rich central and south Americans or Russia to historical patterns of resource distribution are no guarantee of, or even necessary for success. Substitutions developed by technological advances and high levels of recycling have increased sustainability. Self-serving behavior which is self-destructive would seem to be illogical, but is unlikely to still be happening if it is clear to everyone.

Has anyone heard of the notion of the "Singularity" with respect to artificial intelligence (i.e., when superhuman intelligence is attained)? Well folks, I'm afraid to say it, but the joke is on us. Human intelligence has become so artificial, so out of synch with the laws of nature, that I'm afraid our behavior simply cannot get any more inane than it has already become. In short, the Singularity is now.

Science would seem to have made human intelligence more in sync with the laws of nature as opposed to primitive anthropomorphizing of the forces of nature with personalities, gods and spirits.

Coincidentally, I'm in the process of releasing a new documentary on this topic entitled "Peak Reductionism: When Nature Calls." It's coming to a political theater near you.

But seriously, what would be a more innovative approach, with respect to the purpose of resource reallocation, that could replace this repeating cycle of unsustainable, self-destructive, and illogical behavior?

Voluntary exchanges would seem to be the least destructive form of resource reallocation.

Martin L

···

On 11/8/2010 9:24 AM, Chad Green wrote:

Chad

Chad Green, PMP
Program Analyst
Loudoun County Public Schools
21000 Education Court
Ashburn, VA 20148
Voice: 571-252-1486
Fax: 571-252-1633

Shannon Williams<verbingle@GMAIL.COM> 11/8/2010 7:26 AM>>>

> From Shannon Williams (2010.11.08.0630 CST)

Cool. Thank you. Do you have any of the numbers online? Or maybe a
graph showing annual growth rate versus Marginal tax rates?

I can make these for you when I get a chance. None on line yet.

Sweet! That would be cool because then we can use the data in news
paper editorials etc.

So the key to keeping the economy strong is: we can't let the money go
out of circulation. That is the key.

Not quite. It's the aggregate consumer returning all the income (wages and
profits) is received from itself as the aggregate producer. You can read a
description of my ideas about this in my paper

As I note in our private message, if fixing the leakage fixed the
Economy problem, would you still fight for redistribution of wealth as
a means to fix the Economy problem? Or would you be satisfied?

Sincerely,
Shannon

chadtgreen · November 9, 2010, 3:42am

Hi Martin,

You said: "Voluntary exchanges would seem to be the least destructive form of resource reallocation."

I would agree with this assertion. Let's talk about one of our most important non-renewable assets: Time. Time is money as they say, right? What incentives would influence people to reallocate their precious time in a way that (a) stimulates the economy (local, state, national or otherwise), (b) encourages global understanding, creativity, and sustainability, and (c) compels government to champion social entrepreneurship in all of its forms?

But wait, there's more!

To facilitate this framing effort, how could we also re-align the perfunctory nature of monetary exchange into a superior user experience, similar in respects to the Apple mystique, in which form dominated over function? For example, rather than runaway inflation, we'd twist it into something entirely novel along the lines of runaway fashion.

Take a look at a few American bills right now if you have any handy. What do they represent to you? Tradition, stability, certainty, order, importance, honor, permanence, trust? Those are the words that come to my mind.

We live in very different times indeed.

Chad

Chad Green, PMP
Program Analyst
Loudoun County Public Schools
21000 Education Court
Ashburn, VA 20148
Voice: 571-252-1486
Fax: 571-252-1633

Martin Lewitt <mlewitt@COMCAST.NET> 11/8/2010 7:34 PM >>>

[Martin Lewitt Nov 8, 2010 1700 MST]

Shannon,

This paragraph of yours caught my attention:

"As I note in our private message, if fixing the leakage fixed the
Economy problem, would you still fight for redistribution of wealth as
a means to fix the Economy problem? Or would you be satisfied?"

To fix this "economy problem" I think we're going to need to completely rethink and reinvent government as we know it. It should be increasingly clear to everyone that the historical pattern of resource distribution among nations is not only unsustainable, inequitable, and amoral, but it also is self-destructive, self-serving, and illogical (in the intuitionistic sense).

Perhaps you shouldn't assume it is increasingly clear to everyone.
Resources are constantly being redistributed among individuals, so there
is a dynamic process, not a historical pattern. The idea that wealth
was being created by capital and labor and not just static was
recognized by Karl Marx, and you need look no farther than to contrast
the resource poor Asian tigers with the resource rich central and south
Americans or Russia to historical patterns of resource distribution are
no guarantee of, or even necessary for success. Substitutions developed
by technological advances and high levels of recycling have increased
sustainability. Self-serving behavior which is self-destructive would
seem to be illogical, but is unlikely to still be happening if it is
clear to everyone.

Has anyone heard of the notion of the "Singularity" with respect to artificial intelligence (i.e., when superhuman intelligence is attained)? Well folks, I'm afraid to say it, but the joke is on us. Human intelligence has become so artificial, so out of synch with the laws of nature, that I'm afraid our behavior simply cannot get any more inane than it has already become. In short, the Singularity is now.

Science would seem to have made human intelligence more in sync with the
laws of nature as opposed to primitive anthropomorphizing of the forces
of nature with personalities, gods and spirits.

Coincidentally, I'm in the process of releasing a new documentary on this topic entitled "Peak Reductionism: When Nature Calls." It's coming to a political theater near you.

But seriously, what would be a more innovative approach, with respect to the purpose of resource reallocation, that could replace this repeating cycle of unsustainable, self-destructive, and illogical behavior?

Voluntary exchanges would seem to be the least destructive form of
resource reallocation.

Martin L

···

On 11/8/2010 9:24 AM, Chad Green wrote:

Chad

Chad Green, PMP
Program Analyst
Loudoun County Public Schools
21000 Education Court
Ashburn, VA 20148
Voice: 571-252-1486
Fax: 571-252-1633

Shannon Williams<verbingle@GMAIL.COM> 11/8/2010 7:26 AM>>>

> From Shannon Williams (2010.11.08.0630 CST)

Cool. Thank you. Do you have any of the numbers online? Or maybe a
graph showing annual growth rate versus Marginal tax rates?

I can make these for you when I get a chance. None on line yet.

Sweet! That would be cool because then we can use the data in news
paper editorials etc.

So the key to keeping the economy strong is: we can't let the money go
out of circulation. That is the key.

Not quite. It's the aggregate consumer returning all the income (wages and
profits) is received from itself as the aggregate producer. You can read a
description of my ideas about this in my paper

As I note in our private message, if fixing the leakage fixed the
Economy problem, would you still fight for redistribution of wealth as
a means to fix the Economy problem? Or would you be satisfied?

Sincerely,
Shannon

Martin_Lewitt · November 9, 2010, 6:43pm

[Martin Lewitt Nov 9,2010 1108 MST]

Hi Martin,

You said: "Voluntary exchanges would seem to be the least destructive form of resource reallocation."

I would agree with this assertion. Let's talk about one of our most important non-renewable assets: Time. Time is money as they say, right? What incentives would influence people to reallocate their precious time in a way that (a) stimulates the economy (local, state, national or otherwise), (b) encourages global understanding, creativity, and sustainability, and (c) compels government to champion social entrepreneurship in all of its forms?

If you want people to stimulate the economy, then improve the business climate to make lower risk equity capital more affordable, by eliminating the double taxation of the returns to equity capital. Trade encourages global understanding, so free trade agreements would help. I have mixed feelings about artifices like global patent and copyright systems, but those are thought to stimulate creativity and research that improves understanding in western countries. For sustainability, we need to have global agreements to reduce subsidies and price controls, industries that need subsidies in order to survive are not sustainable.

We really need to get government out of the social entrepreneurship business. The licensing of marriages and physicians, bans on recreational drugs and the granting of monopolies to physicians and dentists have just raised prices and reduced competition and social creativity. With the advent of the internet with social networking sites, open software development and wikis there is no reason to think that government should just stay out of the way.

But wait, there's more!

To facilitate this framing effort, how could we also re-align the perfunctory nature of monetary exchange into a superior user experience, similar in respects to the Apple mystique, in which form dominated over function? For example, rather than runaway inflation, we'd twist it into something entirely novel along the lines of runaway fashion.

I get your point, TIVO and DVRs which allow you to skip commercials hopefully help reduce runaway fashion. Currently, peer culture in public schools is another propagator of runaway fads. Perhaps you as a school teacher have ideas about how the aberrant peer cultures enabled by prolonged age segregation in the western limbo of adolescence can channeled to better prepare them for adult responsibilities. Valuing education and critical thinking might be one improvement.

Take a look at a few American bills right now if you have any handy. What do they represent to you? Tradition, stability, certainty, order, importance, honor, permanence, trust? Those are the words that come to my mind.

Since they are a fiat currency, their continued usefulness as a medium of exchange represents the willingness of others to honor them, i.e., an invitation to participate in the economy by producing, exchanging and consuming.

We live in very different times indeed.

And we appear to be very adaptable.

-- Martin L.

···

On 11/8/2010 8:42 PM, Chad Green wrote:

Chad

Chad Green, PMP
Program Analyst
Loudoun County Public Schools
21000 Education Court
Ashburn, VA 20148
Voice: 571-252-1486
Fax: 571-252-1633

Martin Lewitt<mlewitt@COMCAST.NET> 11/8/2010 7:34 PM>>>

[Martin Lewitt Nov 8, 2010 1700 MST]

On 11/8/2010 9:24 AM, Chad Green wrote:

Shannon,

This paragraph of yours caught my attention:

"As I note in our private message, if fixing the leakage fixed the
Economy problem, would you still fight for redistribution of wealth as
a means to fix the Economy problem? Or would you be satisfied?"

To fix this "economy problem" I think we're going to need to completely rethink and reinvent government as we know it. It should be increasingly clear to everyone that the historical pattern of resource distribution among nations is not only unsustainable, inequitable, and amoral, but it also is self-destructive, self-serving, and illogical (in the intuitionistic sense).

Perhaps you shouldn't assume it is increasingly clear to everyone.
Resources are constantly being redistributed among individuals, so there
is a dynamic process, not a historical pattern. The idea that wealth
was being created by capital and labor and not just static was
recognized by Karl Marx, and you need look no farther than to contrast
the resource poor Asian tigers with the resource rich central and south
Americans or Russia to historical patterns of resource distribution are
no guarantee of, or even necessary for success. Substitutions developed
by technological advances and high levels of recycling have increased
sustainability. Self-serving behavior which is self-destructive would
seem to be illogical, but is unlikely to still be happening if it is
clear to everyone.

Has anyone heard of the notion of the "Singularity" with respect to artificial intelligence (i.e., when superhuman intelligence is attained)? Well folks, I'm afraid to say it, but the joke is on us. Human intelligence has become so artificial, so out of synch with the laws of nature, that I'm afraid our behavior simply cannot get any more inane than it has already become. In short, the Singularity is now.

Science would seem to have made human intelligence more in sync with the
laws of nature as opposed to primitive anthropomorphizing of the forces
of nature with personalities, gods and spirits.

Coincidentally, I'm in the process of releasing a new documentary on this topic entitled "Peak Reductionism: When Nature Calls." It's coming to a political theater near you.

But seriously, what would be a more innovative approach, with respect to the purpose of resource reallocation, that could replace this repeating cycle of unsustainable, self-destructive, and illogical behavior?

Voluntary exchanges would seem to be the least destructive form of
resource reallocation.

Martin L

Chad

Chad Green, PMP
Program Analyst
Loudoun County Public Schools
21000 Education Court
Ashburn, VA 20148
Voice: 571-252-1486
Fax: 571-252-1633

Shannon Williams<verbingle@GMAIL.COM> 11/8/2010 7:26 AM>>>

From Shannon Williams (2010.11.08.0630 CST)

Cool. Thank you. Do you have any of the numbers online? Or maybe a
graph showing annual growth rate versus Marginal tax rates?

I can make these for you when I get a chance. None on line yet.

Sweet! That would be cool because then we can use the data in news
paper editorials etc.

So the key to keeping the economy strong is: we can't let the money go
out of circulation. That is the key.

Not quite. It's the aggregate consumer returning all the income (wages and
profits) is received from itself as the aggregate producer. You can read a
description of my ideas about this in my paper

As I note in our private message, if fixing the leakage fixed the
Economy problem, would you still fight for redistribution of wealth as
a means to fix the Economy problem? Or would you be satisfied?

Sincerely,
Shannon