.

[Bonam]

It shows you need a second person with a second income even as a roommate to survive.

No, it shows that a living with a roommate (or several roommates) is a great way to save money.

[bush_cheney2004]

No, it shows that a living with a roommate (or several roommates) is a great way to save money.

Sure is....I have always had a roommate as part of a sound financial strategy. Been with the last one for 25 years (wife).

[Moonlight Graham]

It shows you need a second person with a second income even as a roommate to survive.

Without a roommate you can still get a decent apartment for under $1000. I've known students recently who choose to live downtown right near their university and won't accept anything below an upper-middle scale building and they pay well over $1000/month if closer to 2k, meanwhile you can get a bigger & nicer place with free parking in a basement apartment a 20-30 min bus-ride from downtown and pay well under $1000...and no roommate.

[TimG]

Of course what gets lost in this discussion of roommates is having your own place is an unimaginable luxury to many people in developing countries - the fact that it is a close to achievable for even low income people in Canada is one of the reasons why even the poor here are extremely wealthy in a global context.

[carepov]

Are you saying the Top 1% needs to hoard wealth so those things don't happen?

No. I am saying that wealth concentration is not the "very worst thing that can happen" to an economy.

IMO today's wealth concentration in the America's is excessive - it is not the most devastating issue, but it should addressed as it seems so easy to fix. I am in favour of closing tax loopholes and increasing the marginal tax rates for the upper income brackets. Taxes should be raised gradually and slowly to similar levels that were in place in recent history - not too high so as to encourage tax avoidance/evasion. I basically agree with Warren Buffet.

[bush_cheney2004]

... Taxes should be raised gradually and slowly to similar levels that were in place in recent history - not too high so as to encourage tax avoidance/evasion. I basically agree with Warren Buffet.

Bad idea...this will impact charitable giving negatively. Wealth preservation strategies will always be two steps ahead of the tax man. In any event, why should the government get the extra revenue only to fritter it away ?

[carepov]

Bad idea...this will impact charitable giving negatively. Wealth preservation strategies will always be two steps ahead of the tax man.

Are you disagreeing with the Oracle of Omaha?

Key words in my post were "gradually and slowly"...

By your logic, should we cut taxes for the rich even further?

In any event, why should the government get the extra revenue only to fritter it away ?

Well, it would help to eliminate the deficit. After that, it would be nice to pay down the debt and cut other taxes like the payroll tax.

[Moonlight Graham]

Of course what gets lost in this discussion of roommates is having your own place is an unimaginable luxury to many people in developing countries - the fact that it is a close to achievable for even low income people in Canada is one of the reasons why even the poor here are extremely wealthy in a global context.

Yes fair enough. The whole point of the discussion was that anyone making even 18k here is richer than 90-95% of the global population.

I think for both the richest elites and regular people living in rich developed countries, we all need to make some changes in order to best give the poorest in developing countries the best chance to live much better if they so choose, and we all need to start walking the walk instead of just talking the talk. That goes for Obama too since he's been yapping about "bad inequality" since the report was released. Funny, since he's currently the single most responsible person on the planet for allowing the current exploitation to continue functioning as it does.

[TimG]

I think for both the richest elites and regular people living in rich developed countries, we all need to make some changes in order to best give the poorest in developing countries the best chance to live much better if they so choose, and we all need to start walking the walk instead of just talking the talk.

The best thing we can do is make sure people in poor countries can sell their goods into our markets. We could also fund the development of infrastructure when it makes sense. But there is nothing we can do to fix countries that have bad governments holding them back (Zimbabwe for example). As long as there are bad governments there will be be poor people who are crushed under their heel and it is beyond our ability to fix. Edited January 24, 2014 by TimG

[bush_cheney2004]

...I think for both the richest elites and regular people living in rich developed countries, we all need to make some changes in order to best give the poorest in developing countries the best chance to live much better if they so choose, and we all need to start walking the walk instead of just talking the talk. That goes for Obama too since he's been yapping about "bad inequality" since the report was released. Funny, since he's currently the single most responsible person on the planet for allowing the current exploitation to continue functioning as it does.

No, such changes would be meaningless and President Obama has no such role or power on a global level. Don't write checks with your keyboard that you can't cash.

[bush_cheney2004]

Are you disagreeing with the Oracle of Omaha?

Key words in my post were "gradually and slowly"...

By your logic, should we cut taxes for the rich even further?

More obsessing on rich Americans. The rich already pay the bulk of taxes, and there are not enough of them to fund the bloated and growing social welfare state(s). There is a structural problem with existing entitlement programs and demographics. If you want to raise taxes, raise them for ALL marginal rates.

Well, it would help to eliminate the deficit. After that, it would be nice to pay down the debt and cut other taxes like the payroll tax.

Deficits are a spending problem, not a revenue problem.

[WWWTT]

http://economix.blogs.nytimes.com/2011/01/31/the-haves-and-the-have-nots/?_php=true&_type=blogs&_r=0

Eyeballing the graphs says that the Top 60% of people in the US are richer than 90% of the world. The top 15% in the US are richer than 99% of the world. To be in the Top 60% your income must be greater than 40K.

Thanks TimG, this one has income levels adjusted to cost of living, this evens the playing field somewhat.

WWWTT

[Moonlight Graham]

The best thing we can do is make sure people in poor countries can sell their goods into our markets. We could also fund the development of infrastructure when it makes sense. But there is nothing we can do to fix countries that have bad governments holding them back (Zimbabwe for example). As long as there are bad governments there will be be poor people who are crushed under their heel and it is beyond our ability to fix.

I agree mostly, but i think we can do our part to not support and prop up many of these bad governments just because they support our interests. We should encourage and reward democracy and good governance and not the opposite.

I agree to we need to "make sure people in poor countries can sell their goods into our markets", but this also means we can make policies to ensure they can get to a point where they're able to sell us much more valuable finished manufactured goods with the value of labour, technology, and human creativity added to resources, and not just sell us their raw resources as is common in ie: most parts of Africa and much of Latin America, Middle-East, and underdeveloped parts of Asia. That's why South Korea and Japan are rich, they sell us kickass cars and electronics and not just oil, minerals, cash crops etc. This takes infrastructure yes, and also technology transfer, education & knowledge transfer, and support by developing governments to protect their domestic industries from being decimated by foreign entities, as South Korean gov has done.

[TimG]

i think we can do our part to not support and prop up many of these bad governments just because they support our interests. We should encourage and reward democracy and good governance and not the opposite.

The world is too complicated for such simplistic moralisms. The Muslim brotherhood was democratically elected in Egypt yet would have stripped away many freedoms we take for granted. The military suppresses political freedoms but provides a freer environment for minorities to live. The Chinese government is also an example of government that is gross abuser of human rights but a billion people have been lifted out of poverty thanks to trade with China.

This takes infrastructure yes, and also technology transfer, education & knowledge transfer, and support by developing governments to protect their domestic industries from being decimated by foreign entities, as South Korean gov has done.

You got to be kidding. Our domestic economy depends on the sale of knowledge and you think it should just be given away? That is like helping the homeless by giving them your home. I support charity but there has to be a limit. Also trade is a two way street. If the poor want access to our markets we have to have access to theirs. Furthermore, forcing people to buy inferior locally made products is one of the reasons why India has been slower to develop its economy. Edited January 24, 2014 by TimG

[Moonlight Graham]

You got to be kidding. Our domestic economy depends on the sale of knowledge and you think it should just be given away? That is like helping the homeless by giving them your home. I support charity but there has to be a limit.

I never said anything about giving away knowledge, let alone any specific kind of knowledge, so that's a strawman. But I do think international IP laws work against developing countries. ie: Pharmaceutical companies make enough money, they don't have to ban generic versions of their meds in poor countries to leave people to suffer or die because they cant afford them.

Also trade is a two way street. If the poor want access to our markets we have to access to theirs.

Both should have access, but we shouldn't demand free and full access to weaker markets we can exploit. Controlled market access is a vital part of the reason why the East Asian Tigers were able to develop quickly while others elsewhere ie: in Latin America have been struggling via the US forcing open their markets in return for debt relief and US/western companies dominating their economies while pumping surplus profits out of the country. There's a reason why Cuba has had some of the highest (both historical and projected) GDP growth rates per capita among Latin American countries (even higher than Brazil, and projected to remain so through 2030) despite a US embargo.

[Michael Hardner]

Deficits are a spending problem, not a revenue problem.

That kind of blanket statement ignores the fact that collective action to solve problems sometimes needs more - or less - resources. The idea that we should just spend less ignores history, and all the times when human mistakes caused increased human misery, and needed more money from those who had it.

[bush_cheney2004]

That kind of blanket statement ignores the fact that collective action to solve problems sometimes needs more - or less - resources. The idea that we should just spend less ignores history, and all the times when human mistakes caused increased human misery, and needed more money from those who had it.

Easy for you to say....it's fun to to get that meaningless "feel good" high from spending OPM....Other People's Money. Spending less is exactly what is required to avoid a whole lot more "human misery". "Collective action" means everybody, not just the rich.

[TimG]

That kind of blanket statement ignores the fact that collective action to solve problems sometimes needs more - or less - resources.

The problem with government today is it already large enough that existing programs can consume whatever additional revenue is provided through wage and benefit increases for existing employees.

This means that if someone wants to raise taxes today for some noble purpose it is reasonable to ask whether the new funds would actually be spent on the said purpose or will it simply be used to increase the cost of existing programs.

In general I would say that needs change over time and if a new problem requires additional spending then it is reasonable to say that this new money should be found by re-allocating existing tax dollars to the new priorities. To argue that every existing program is an essential priority is to argue that government should constantly expand until it consumes all resources.

Edited January 24, 2014 by TimG

[Michael Hardner]

Spending less is exactly what is required to avoid a whole lot more "human misery". "Collective action" means everybody, not just the rich.

Spending less may indeed be part of this, but you can't get money from a rock. The US isn't like Greece, with a suite of gold plated social programs.

[Michael Hardner]

This means that if someone wants to raise taxes today for some noble purpose it is reasonable to ask whether the new funds would actually be spent on the said purpose or will it simply be used to increase the cost of existing programs.

In general I would say that needs change over time and if a new problem requires additional spending then it is reasonable to say that this new money should be found by re-allocating existing tax dollars to the new priorities. To argue that every existing program is an essential priority is to argue that government should constantly expand until it consumes all resources.

That sounds good on the surface, and of course everybody can agree on right-sizing government, not wasting resources and so on. But it also doesn't make sense to cut programs during a recession in a lot of cases. Governments aren't fast enough or adept enough to resize in response to things such as a recession.

[carepov]

More obsessing on rich Americans. The rich already pay the bulk of taxes, and there are not enough of them to fund the bloated and growing social welfare state(s). There is a structural problem with existing entitlement programs and demographics. If you want to raise taxes, raise them for ALL marginal rates.

Don't you think that it's a problem when the Buffetts/Romneys pay a lower net tax rate than their secretaries?

Deficits are a spending problem, not a revenue problem.

I never said that there was no spending problem, it looks like a bit of both:

If ever revenues get too high, increased revenues from the rich should be offset by the reduction of regressive taxes like the payroll tax.

I also think that, in the long term, a reduction in poverty would would reduce entitlement spending.

[TimG]

But it also doesn't make sense to cut programs during a recession in a lot of cases.

The same argument applies to increasing taxes during recessions. But the recession is over so this point is moot.

[TimG]

Don't you think that it's a problem when the Buffetts/Romneys pay a lower net tax rate than their secretaries?

The existing tax system is designed so corporate profits are only taxed once. i.e. a company pays taxes and the pays dividends from its after tax profits. The people who earn money from those dividends get a discount equal to the corporate tax paid. This is a good system design but it does have the side effect of lowering the tax rate for investors (many of whom are modest income retirees).

If ever revenues get too high, increased revenues from the rich should be offset by the reduction of regressive taxes like the payroll tax.

In the US, Obamacare is a huge payroll tax. The chances of Americans agreeing to fund Obamacare from general revenues is next to zero.

[bush_cheney2004]

Spending less may indeed be part of this, but you can't get money from a rock. The US isn't like Greece, with a suite of gold plated social programs.

This topic isn't just about the US...or Greece. The growth in government spending must be curtailed ("bend the curve") for several practical reasons having nothing to do with ideology or tax policies. And yes, this includes military spending.

[bush_cheney2004]

Don't you think that it's a problem when the Buffetts/Romneys pay a lower net tax rate than their secretaries?

No, it is not a problem. They still pay the lion's share of the taxes. Pandering to populist ideas is a poor way to structure tax policy. As Mr. Romney fatally pointed out, 47% of Americans pay no income tax at all. Oh what is a poor overtaxed secretary to do ?

Total U.S. federal, state, and local gov't spending now surpasses WW2 levels as a percentage of GDP:

Edited January 24, 2014 by bush_cheney2004