Topic: Who creates the jobs? - page 2. (Read 5084 times)

hmm, is there a reason you appear to be equating relative wages with personal savings rate?

People have been maintaining living standard despite falling (relative) wages by increasingly getting in to debt for almost a generation.



Most of this debt was mortage debt. This has kept the economy going for a while, but as you can imagine its not exactly a long term solution.

As for other countries, this may interest you:

So I've been thinking about this.  It makes sense that you need demand for products as well as companies to actually produce those products.  Also, I understand that the disparity in income is increasing, but I'm not so sure that poor people are buying less stuff.  Most of my friends have higher standards of living then I do regardless of whether or not they earn more than I do.  For example, my brother earns far less than I do but has an x-box, play station, lots of games for those consoles, movies, tv shows, x-box live, bigger flat screen tv than I do, etc.  I have an x-box which was given to me by someone and have only bought one game for it.  My wife and I bought a flat screen TV for just over $100 because we used gift cards from out wedding.  We buy cheap food as much as possible and don't eat out very often.  I'm in school and so funds are pretty tight most of the time. 

Perhaps part of the problem is people who live outside of their means?  I know plenty of people who make fairly low wages (like I do) but who have gotten new vehicles because they magically got approved for loans with little or no down payments.  This then saddles them with debt for years keeping them from developing savings that can be used to improve themselves (schooling, start up business, whatever) and increase their wages.  I'm not trying to blame poor people entirely for their own poverty, but certainly wise financial decisions have to play a part.  So, anecdotally, at least, it seems to me that "poor" people are still spending lots of money. 

Anyone have thoughts on this?  Are people living outside of their means and how does that affect the economy? 

P.S. I'm referring mostly to Americans, not because I'm trying to be ethnocentric but it's where I live and what I have experience and context for.  My apologies to JA37 and anyone else who is from a different country.  Perhaps the situation in Europe or Australia is different.  I'd be curious to hear your thoughts on the situation in your respective countries.

So why didn't the democrats repeal them? Why not force their own bills through congress? Also I was more confused on what tax hike you were talking about on the "poor."

My main thing though, is that I am interested in your complete lack of interest in monetary policy. Apparently your model for how wealth has been draining into the hands of the already rich is completely fleshed out without needing to take that into account. Impressive.

When I hear politicians making the "job creator" argument I can't help but wonder if they think I have down syndrome. The idea that a business person would leave money on the table because their personal taxes are too high is ridicules.
If my customers demand is higher than my ability to produce, then I hire someone. It does not matter what I pay in taxes. I hire people to make more money for me, not some act of kindness.
So, who creates jobs? I do. (well, I have.) Want me to create more jobs? Then show me how it will lead to greater profits and the job is yours.

Possibly something to do with the Reagan era tax cuts, the Bush era tax cuts, the second bush era tax cuts and the extension to the bush era tax cuts that republicans forced through congress.

Where do you get the idea its the "republicans" specifically that are to blame? Also, which tax hikes to the poor are you talking about and what are your definitions of rich and poor?




Basically I think this thread is getting too emotional so peoples arguments are starting to suck.

No need for name-calling. Although I disagree with almost everything b2c writes I think we should try to keep the tone civilized and respect each others viewpoints.

No you moron, people aren't going to found companies when no one has any money to buy their products. This is the core of the problem. Republicans have been giving tax breaks to the rich and tax hikes to the poor for so long now that the rich have more money than they can ever spend while the poor are forced to buy essentially nothing, which stifles the economy and prevents job growth by decreasing demand for essentially everything.

Thanks for the article and graphs p4man, it's a good read.  i also like his rebuttal linked at the end. 

We already have a sun, so thats not relevant. We already have companies making just about everything that people desire and that money can buy. What we dont have is customer demand for their products because the customers are broke. Its not rocket science.

I'm glad you admit the article isn't entirely interesting but I did read it and the followup. It boils down to the claim that without customers, there would be no jobs. Which is true. But wait, without the sun, there would be no jobs either. Therefore the sun actually creates the jobs. All hail Apollo, the sun god!

Keep reading. You almost made it to the interesting part.

Alright, let's see the argument.


These companies that employ thousands of people aren't creating jobs? Those jobs would exist without those companies? I think not. Nice try.

Interesting charts P4man. Can you give us the source so we can see what the numbers mean?

And things were so much better in 1929.


Quite the opposite. Corporate taxes have been going down since WW2 while labor tax has been rising. The result is the rich got richer but the economy is in shambles because consumers have no spending power.

Good food for thought.  I'm not sure I agree with what I understood to be the ultimate point of the article (that we need to tax the rich more) but it does seem to be true that if there is no demand it doesn't matter how many companies you start up, they won't survive.  It seems that one group of people likes to focus all on the supply (rich people create businesses and grow the economy) and the other group of people focus all on the demand (tax the rich and give money to poor people so they can spend it to create jobs).  It is true that without capital accumulation we cannot expand businesses, create new ones and grow the economy, but people do need to have money to spend.  Supply and demand are two sides to the same coin.  I'll have to think about this more and do some more reading of economic texts to see if I can find a solution that satisfies me.

Everyone creates the jobs, we're creating jobs for Microsoft and the people around the entire www.

No, a company will not expand unless there are profits.  Suppose someone has a fence that needs painting, but the owner needs money to paint the fence.   The government says tax the people with money and give it to poor people so they can hire someone to paint the fence.  The capitalists says let the owner paint his own fence and buy his own paint.

This is mistaking the effect with the cause. The markets create jobs, and investment realizes them. Without a favorable market, the investment would not happen in the first place.