Robert Reich: Why American Capitalism is So Rotten

[Doctor CamNC4Me]

The answer is obvious. Neither Mayors nor Governors have control over federal tax policy. The income tax cuts since 1980 are the major cause of the redistribution of income from the middle class to the ultra rich.

Can't you just use state income taxes to implement your plans? Then when it works people would move in to become a part of the better standard of living.

QED

- Doc

[Doctor CamNC4Me]

Ajax,

What part of Robert Reich's economic philosophy that:

1. addresses the 73% of Boomers retirement savings of $100k or less so they’re not on the street
2. ensures workers are guaranteed strong wages and retirement plans so they can own a home and make sure their families can get care without devastating debt, and
3. making sure your kids have a safety net if they’re injured or unfairly fired

do you hate the most?

Strong middle-class.
Strong local economies.
Reduced recession cycles.

- Doc

I'd like to see most of the that. My question to you is why we don't see this on the left coast or inner cities where Democrats have been in power for so long?

Rich men north of Richmond.

- Doc

[Gadianton]

Reich describes the typical economic arguments between Rs and Ds over the last several decades: (1) free markets v. government regulation and (2) redistribution of income and wealth. But, according to Reich, these typical arguments function as a diversion that keeps people from understanding how the market itself has been altered in the U.S. over past decades.

This is true.

This question is a proxy of other similar questions, and I think gets to the heart of the problem:

Do you believe your home should be a good investment?

[Res Ipsa]

Reich describes the typical economic arguments between Rs and Ds over the last several decades: (1) free markets v. government regulation and (2) redistribution of income and wealth. But, according to Reich, these typical arguments function as a diversion that keeps people from understanding how the market itself has been altered in the U.S. over past decades.

This is true.

This question is a proxy of other similar questions, and I think gets to the heart of the problem:

Do you believe your home should be a good investment?

For a resident homeowner or an investor?

[Gadianton]

For a resident homeowner.

[honorentheos]

For a resident homeowner.

I'll bite.

Interesting question. Should one expect the value of a house to exceed other investment opportunities such that a home owner should expect the money put toward home ownership to outperform money put into the stock market? That's a different question from if a person should expect the money they put towards homeownership to be more like a savings bond, with almost no risk of loss and the value increase being modest at best.

Historically it seemed like folks saw it more like the latter as it was believed home value didn't really depreciate. But as it became more of a commodity detached from housing being the first objective for buying a home, the associated risk increased as well.

In that context I would say, no, I don't think home ownership should be a good investment as a form of risk-reward investing. But it should be a good means of securing wealth.

[Vēritās]

We purchased our new construction home in 2017 for $471k.

It appraised in July at $1.2 million.

Of course, we put probably $300k into renovations but still, that's a pretty good investment. Especially since we can borrow against the equity to invest in other opportunities such as home flipping.

[Gadianton]

We purchased our new construction home in 2017 for $471k.

It appraised in July at $1.2 million.

Of course, we put probably $300k into renovations but still, that's a pretty good investment. Especially since we can borrow against the equity to invest in other opportunities such as home flipping.

If this had anything to do with my question, remember my question was should a home be a good investment. It wasn't are homes a good investment. Nobody learned anything new by learning that somebody bought a house, fixed it up, and made money off of it.

[Vēritās]

How do you know what anyone else may have learned?

Homes are either a good investment or they aren't. I don't even understand the question "should they be"?

Water feels wet...but should it?

[honorentheos]

How do you know what anyone else may have learned?

Homes are either a good investment or they aren't. I don't even understand the question "should they be"?

Water feels wet...but should it?

Gad's question gets at what is being incentivized. Remember the context for the original question:

Reich describes the typical economic arguments between Rs and Ds over the last several decades: (1) free markets v. government regulation, and (2) redistribution of income and wealth. But, according to Reich, these typical arguments function as a diversion that keeps people from understanding how the market itself has been altered in the U.S. over past decades.

This is true.

This question is a proxy of other similar questions, and I think gets to the heart of the problem:

Do you believe your home should be a good investment?

Those incentives have consequences, and society is impacted differently if housing price increases are incentivized compared to other alternatives. Access to credit specific for buying a home, Fed rate, etc., are examples of actions taken by government whose form incentivizes behaviors that reflect certain economic views. Don't know if Gad borrowed this or came up with it, but I thought it was clever as a means of examining the root question.

ETA: To add to the above, consider a parallel question of if home ownership should be affordable for the majority of households? Is there tension between that question and the question of if home ownership should be a good investment?