Side-by-side economics: McCain/Palin vs. Obama/Biden

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Orwell
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09 Sep 2008, 9:31 am

ed wrote:
Pro-market is not the same thing as pro-people.

Yes it is. Study some economics.

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People who oppose NAFTA and other free-trade arrangements are not "protectionist idiots," they are people who are tired of seeing their jobs sent elsewhere, and their money disappear into the hands of the super-rich.

No, those are protectionist idiots. Study some economics. A factory opening in Mexico does not mean they are "stealing" American jobs.

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It is very easy to understand when you see the working class becoming poorer while the rich become even richer.

At the moment, our economy is in a bit of a slump, no arguing with that. But the general trend has been indisputably for both the rich and the poor to become richer. The working class in America enjoys a higher standard of living than the richest people in the world could have dreamed of a few hundred years ago.


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Awesomelyglorious
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09 Sep 2008, 9:54 am

Orwell wrote:
ed wrote:
Pro-market is not the same thing as pro-people.

Yes it is. Study some economics.

To be fair, some arguments can be made for ed, just not on the issue of trade so much. It is true that some Austrian economists think that the market does meet the qualifications of a Rawlsian system though(not national economy so much as overall, international economy.

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People who oppose NAFTA and other free-trade arrangements are not "protectionist idiots," they are people who are tired of seeing their jobs sent elsewhere, and their money disappear into the hands of the super-rich.

No, those are protectionist idiots. Study some economics. A factory opening in Mexico does not mean they are "stealing" American jobs.

He does have a point, as if that specific job is in Mexico, that labor cannot be done in the US. He also never said "steal". However, the issue is that there is not a lump sum of jobs anyway, so this really is just downward pressure on wages, however, the unemployment rate has been somewhat low until now.

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At the moment, our economy is in a bit of a slump, no arguing with that. But the general trend has been indisputably for both the rich and the poor to become richer. The working class in America enjoys a higher standard of living than the richest people in the world could have dreamed of a few hundred years ago.

Well, recent trends in income inequality(recent being from the 80s) in the US have been against the poor somewhat. With gains going to the rich disproportionately. This is likely an issue of demand for labor, and probably not something the government has a good solution for given that the common notion of a good solution is preventing people in other nations from getting work, and that is hardly efficient or good for the other people, nor would it solve the entire problem anyway because technology is definitely a significant factor.



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09 Sep 2008, 10:00 am

Awesomelyglorious wrote:
Orwell wrote:
ed wrote:
Pro-market is not the same thing as pro-people.

Yes it is. Study some economics.

To be fair, some arguments can be made for ed, just not on the issue of trade so much. It is true that some Austrian economists think that the market does meet the qualifications of a Rawlsian system though(not national economy so much as overall, international economy.

It's not only the Austrians who are pro-market. It's pretty much anything resembling economics. Free markets lead to economic growth, which is good for people. I mean, unless you want to start on some Marxist stuff or go back to mercantilism, I don't really see what arguments can be made there.

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Well, recent trends in income inequality(recent being from the 80s) in the US have been against the poor somewhat.

Increased income inequality does not necessarily mean the poor are getting poorer. It just means the rich are getting richer faster than the poor are.

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The common notion of a good solution is preventing people in other nations from getting work, and that is hardly efficient or good for the other people, nor would it solve the entire problem anyway because technology is definitely a significant factor.

Hence my accusation, "protectionist idiot." The problem with trying to use protectionism here isn't just that it will fail to solve the problem with technology also coming into play; it will also create more problems by shrinking the size of the market.


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Awesomelyglorious
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09 Sep 2008, 10:08 am

Orwell wrote:
It's not only the Austrians who are pro-market. It's pretty much anything resembling economics. Free markets lead to economic growth, which is good for people. I mean, unless you want to start on some Marxist stuff or go back to mercantilism, I don't really see what arguments can be made there.

Well, neo-classicals have been very market oriented since the fall of the USSR. Post-Keynesians however are not market oriented. Not only that, but usually the debate isn't on all markets vs no markets, but rather how many markets. So, if all markets are not the same, and one argues that one market would do better with more regulation or something like that, such is a defendable stance.

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Increased income inequality does not necessarily mean the poor are getting poorer. It just means the rich are getting richer faster than the poor are.

I actually think there are some signs that the lowest quintile really isn't getting a lot wealthier due to the labor market trends. It can be argued that some inter, or intra quintile shifting can cause the poor to get wealthier though, however, that is an argument to be made rather than assumed.

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Hence my accusation, "protectionist idiot." The problem with trying to use protectionism here isn't just that it will fail to solve the problem with technology also coming into play; it will also create more problems by shrinking the size of the market.

Well, I do agree with you that protectionism will cause problems by decreasing the size of the market, however, I think that certain labor market models do show that tariffs can increase the wages of some workers. It is just that these changes do not seem justifiable when given an understanding of how free trade impacts long-run growth and when understanding how free trade impacts foreign labor. So, I would not hurl around the term "protectionist idiot" too lightly, even if it is the case.



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09 Sep 2008, 11:24 am

Awesomelyglorious wrote:
Well, neo-classicals have been very market oriented since the fall of the USSR. Post-Keynesians however are not market oriented. Not only that, but usually the debate isn't on all markets vs no markets, but rather how many markets. So, if all markets are not the same, and one argues that one market would do better with more regulation or something like that, such is a defendable stance.

Regulation is one thing, overt protectionism another. I'm not up on Keynesianism, are they protectionist now?

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I actually think there are some signs that the lowest quintile really isn't getting a lot wealthier due to the labor market trends.

But overall, the constant assertion that "the poor are getting poorer" is without basis. In relative terms they may be falling behind the filthy rich, but aside from temporary blips like the current slowdown, people are not getting noticeable poorer in any quantitatively absolute way.

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Well, I do agree with you that protectionism will cause problems by decreasing the size of the market, however, I think that certain labor market models do show that tariffs can increase the wages of some workers.

The benefits of those increased wages are easily wiped out by the other problems caused by excessive restriction of trade, such as higher prices not just for some workers but for all consumers.

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So, I would not hurl around the term "protectionist idiot" too lightly, even if it is the case.

Well, I suppose it is unnecessarily redundant.


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monty
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09 Sep 2008, 11:29 am

Orwell wrote:
ed wrote:
Pro-market is not the same thing as pro-people.

Yes it is. Study some economics.


No, although it is taken on faith by most economists that the two things are synonymous, there is no real evidence that pro-market is always pro-people.

Consider:
http://www.adbusters.org/magazine/78/th ... omics.html

An excerpt:

The fact that CEOs earn millions while their workers struggle by on minimum wages is either not examined in classrooms or is shown by the mainstream model to be completely consistent with properly working markets and to be leading to the best of all possible worlds,” says Lee.



Awesomelyglorious
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09 Sep 2008, 11:42 am

Orwell wrote:
Regulation is one thing, overt protectionism another. I'm not up on Keynesianism, are they protectionist now?

No, few economists are protectionist, however, that does not mean that few economists cannot think of protectionist arguments that are viable. They just tend to deny that they would be policies that would help people get what they want.

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But overall, the constant assertion that "the poor are getting poorer" is without basis. In relative terms they may be falling behind the filthy rich, but aside from temporary blips like the current slowdown, people are not getting noticeable poorer in any quantitatively absolute way.

Well, as a statement of fact for all of history? No. As a statement of fact for all capitalist systems? No. But it can be valid for some recent times in US history.

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The benefits of those increased wages are easily wiped out by the other problems caused by excessive restriction of trade, such as higher prices not just for some workers but for all consumers.

Well, the greater efficiency. The reduced costs do not translate perfectly over to reduced prices. You are right, net gains exceed losses, and to the extent where winners could compensate losers. However, that does not mean that free trade does not produce some losers in some nations.

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Well, I suppose it is unnecessarily redundant.

What I mean is that there are economists, such as Harvard's Dani Rodnik who have questioned the strong orthodoxy towards free trade and the blurring of the distinction between positive and normative economics found in that issue. So, no, it is not necessarily idiocy.



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09 Sep 2008, 11:55 am

Orwell wrote:
But overall, the constant assertion that "the poor are getting poorer" is without basis. In relative terms they may be falling behind the filthy rich, but aside from temporary blips like the current slowdown, people are not getting noticeable poorer in any quantitatively absolute way.


On a nominal level, the poor are making more money... after all, minimum wage, as far as I remember, had never decreased in nominal amount. However, once you adjust for inflation, you see that the minimum wage is rising more slowly than the inflation rate...



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09 Sep 2008, 11:58 am

ToadOfSteel wrote:
On a nominal level, the poor are making more money... after all, minimum wage, as far as I remember, had never decreased in nominal amount. However, once you adjust for inflation, you see that the minimum wage is rising more slowly than the inflation rate...

Very few people earn minimum wage, though. Heck, even my part-time job putting books on shelves pays better than minimum wage. I was referring more to standard of living though anyways.


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Awesomelyglorious
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09 Sep 2008, 12:03 pm

monty wrote:
No, although it is taken on faith by most economists that the two things are synonymous, there is no real evidence that pro-market is always pro-people.

Consider:
http://www.adbusters.org/magazine/78/th ... omics.html

Right... because we need a lot more feminist perspectives on economics. I've read the article before, and you know it is openly biased to favor heterodoxy. Frankly, there can be something questionable in a lack of mathematical formalism given the useful of it from a theoretical perspective and to clarify thought. I mean, that is why philosophers have formal logic. Not only that, but talk about a "lack of talk on social justice" merely is reflective of the distinction between positive and normative economics, that is rarely enforced. Most academic economists favor welfare measures though, and vote democrat, so the "cold market loving" image seems questionable. Also, issues of CEO pay have been examined by economists looking for both issues with the institutional mechanisms, and Bob Frank has argued that market structures themselves are behaving in a manner that hurts social welfare.

Also, the notion that neoclassical economists don't address important issues is certainly overstated. Gary Becker, one of the disciples of the Chicago school became an influence on sociology and did important work on crime and families. James Buchanan developed a model of political corruption. The economics and law movement has taken some prominence as well. I mean, a common complaint isn't that economists are just overly focused on economics, but also that the field is invading non-economic issues. Not only that, but the attack on neo-classical economics as creation science seems very questionable.

Not only that, but the article is clearly just playing the ideology card, as heterodox economics does not have to be antimarket. The Austrian school, which had already been mentioned in this conversation is more pro market than the neoclassical school, and yet it is also shut out of the economics profession despite having a nobel prize winner, and some intellectual influence upon a number of great economists, including Nobel Prize winners.

Finally, a number of economists push for deviations from a purely promarket stance, and I have even been arguing with Orwell about how these arguments can be made so that he does not confuse the normative and positive views. So, you are just wrong on everything.



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09 Sep 2008, 12:06 pm

ToadOfSteel wrote:
On a nominal level, the poor are making more money... after all, minimum wage, as far as I remember, had never decreased in nominal amount. However, once you adjust for inflation, you see that the minimum wage is rising more slowly than the inflation rate...

Right, as Orwell states, the minimum wage is not the wage that people are necessarily paid. In fact, before the most current wage hike efforts, very few people got paid that amount, and I think about 80% of the people paid that amount were not under poverty levels, and 70% had a household income of 1.5 times the poverty level... this is just my attempts to remember what I think I read in a CBO report.



ed
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09 Sep 2008, 12:18 pm

Awesomelyglorious wrote:
ed wrote:
Pro-market is not the same thing as pro-people. NAFTA allows corporations to move jobs to Mexico, pay very little in wages, and pollute the Mexican environment at will. thus making more money for their wealthy owners. Of course this is terrible for the American workers who got laid off.

Well, and a boon for the Mexican workers who get the jobs. Especially given that Mexican workers get very little in wages already, so it isn't as if that really is a massive problem for them. Not only that, but given that the number of jobs is not a fixed number, it really does not end up being as terrible as we seem to see suggested. Especially given that in this case "pro-people" is the same as "pro-market" as Mexican workers would have to be worse-off without the trade agreement, unless you hold to the idea that more employers competing for laborers means lower wages, which makes neither logical nor economic sense.

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People who oppose NAFTA and other free-trade arrangements are not "protectionist idiots," they are people who are tired of seeing their jobs sent elsewhere, and their money disappear into the hands of the super-rich. It is very easy to understand when you see the working class becoming poorer while the rich become even richer.

Well, for the most part, I would say that they are, because they also are drawing an arbitrary distinction between technological change and economic changes, as the economic effects of something like NAFTA are essentially the same as if we developed a new technology, except with the benefit of helping Mexicans, and unless the NAFTA haters would oppose a new technology or hate Mexicans, we have an internal inconsistency.
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The Republicans say "See? The economy is growing," but it is only growing for the wealthy; for everyone else the economy sucks, and these free-trade agreements are one of the biggest reasons.

Changes in technology are another reason as they make certain workers more expendable as well. Not only that, but in terms of the world economy, free-trade agreements are probably the best international economic welfare things that the US does. Not only that, but even if the US gave the poor welfare payments to completely compensate for losses from their job competition, the US would still come out ahead in the economics anyway.


I don't give a rat's ass about helping Mexicans get jobs if it's at our expense!


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Last edited by ed on 09 Sep 2008, 12:20 pm, edited 1 time in total.

Orwell
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09 Sep 2008, 12:20 pm

ed wrote:
I don't give a rat's ass about helping Mexicans get jobs at our expense!

So when you said "pro-market is not pro-people," you actually meant "pro-market does not benefit a certain specific group of people that I care about more than the rest of the world." And in any case, the Mexicans aren't getting jobs "at our expense" because if they were we wouldn't hire them. More trade is good for everyone.


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09 Sep 2008, 12:22 pm

ed wrote:
I don't give a rat's ass about helping Mexicans get jobs at our expense!

So, you don't like the idea of helping other people much poorer than we are? And yet you accuse markets as not being pro-people? I think you have just proven that markets care more about people than most people do.



ed
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09 Sep 2008, 12:33 pm

Orwell wrote:
ed wrote:
I don't give a rat's ass about helping Mexicans get jobs at our expense!

So when you said "pro-market is not pro-people," you actually meant "pro-market does not benefit a certain specific group of people that I care about more than the rest of the world." And in any case, the Mexicans aren't getting jobs "at our expense" because if they were we wouldn't hire them. More trade is good for everyone.


Yes. That specific group of people is the hard-working but ill-paid workers of the United States. NAFTA allows companies to shut down it's US plants and relocate them to Mexico. If you think that is a good thing, then you must have a warped sense of priorities.

And if you don't think that our real wages are going down, then you are simply not paying attention.


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09 Sep 2008, 12:36 pm

ed wrote:
NAFTA allows companies to shut down it's US plants and relocate them to Mexico. If you think that is a good thing, then you must have a warped sense of priorities.

Yes, I do think that is a good thing.


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