And yes, it is true that I believe, as do most Economists, that Supply-Side economics was an abject failure,
Only most economists within the particular intellectual cubicle within which you reside. Its highly doubtful that most economists actually believe this, and, even if true, would tell us little of the actual substance of the case. You're use of the claim here is yet one more instance of the only thing you ever have left to fall back upon, the good old trusty
argumentum ad populum. After that, your quiver is pretty much shot.
The tremendous success of free market based, supply-side (there's no such thing as "trickle down economics," That term was invented by the Left) is a matter of historic and empirical fact, and no degree of sour grapes leftist myth making and outright prevarication, which is what is required to rewrite the history here, can change the facts of the matter. Nor all the carefully cooked, sauteed, basted, and deep fat fried graphs and charts Kevin can cobble from obscure leftists blogs and partisan activist attack sites.
and I also agree with most business owners that the biggest burden they face is lack of consumer demand, not oppresive government regulations as Doofus keeps going on about.
Empirically false, as I've demonstrated in post after post after post regarding well known polling data in which business owners have been questioned about precisely this state of affairs.
Forbes, as well as other major venues, has reported on this extensively.
But, just keep in mind that Kevin Graham is a totalitarian statist; a defender of Marx and of socialist/communist theories of human economic and social organization. He is a believer in a thoroughly closed, regimented, collectivist economic system in which human life is rigorously controlled and determined by ideologues and messianic theoreticians. His hatred of freedom, free markets, free economic relations between human beings, and of human agency functioning outside the reach of the manacles and chains forged by anointed social reformers such as he fancies himself to be, is deep and pitiless.
I have facts and evidence on my side while Doofus is still trying to justify Supply-Side economics.
You have no empirical or historical basis whatsoever, as I, bc, and any number of other conservative/libertarian posters in this and the Fair message board have, over the years, conclusively shown more times then could be enumerated here. You are an economic illiterate and an angry, bitter, histrionic leftist propagandist for human serfdom, who, like the philosophy you slavishly prostrate yourself before, has been discredited, theoretically and morally, since its very inception, and empirically since early in the 20th century.
You are quite good at cobbling together carefully cooked and massaged graphs, charts, and statistical graphics showing exactly what the chef who produced them desires to show (and this, of course, has been the grand trick used by the climatists in a primarily post-literate, visual age to fool the video game generation regarding the "empirical" evidence of AGW) without understanding or caring how those graphics were created, using what data, ignoring what data, with what mathematical formula and statistical processing, and based upon what assumptions. What people like Graham call "facts" and "evidence" are always, upon closer inspection, really nothing more than statistical and analytic slight-of-hand and shell-gaming dressed up in scientific-looking visuals. If you have a series of bars, a pie, or a trend line with numbers attached to it, you must have "facts" and "evidence."
Well, surely you must. Right?
It takes a true moron to sit there and insist increased production is going to save an economy when consumers have no money to spend.
Again, your utter lack of actual education or serious understanding of economics and political economy shows itself in almost every sentence. Regurgitating Paul Krugman and the medianomics you've absorbed from the mainstream media "progressive" journalistic propaganda you take to be "news" is now on the chopping block. Lies, falsehoods, and blind, ideological purity always are.
Empirically, the idea that people have no money to spend is bosh. You can look at the data here:
http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1Real personal consumption as personal expenditure had recovered fairly well from the original recession by the fourth quarter of 2010. It has continued to grow since that time, and is now above its pre-recession peak.
Government expenditure is also well above pre-recession levels.
At the same time, gross private domestic fixed investment has done what? Exactly, fallen substantially from the second quarter of 2007 onward. Since the second quarter of 2011, its been 19% below its peak before the recession. These data don't fully capture how negative the investment situation really is, however, because most investment right now is taking place as ""capital-consumption allowance," which is compensation for the deterioration and obsolescence of present capital stock.
Consumer spending, in other words, has substantially recovered since 2007. So why are jobs so scares and job creation so anemic?
Simple. The core causal phenomena is Obama and the Democrats progressive/socialist, anti-business, anti-wealth creation, statist meddling and dictatorial control across the economy and the pervasive rhetoric of anti-capitalism and class war, assisted by real-world policies - Obamacare, massive tax increases (within Obamacare and elsewhere), fantastic government spending and debt creation, the potential collapse of the dollar, a government regulatory war on business and the energy sector (from Obama himself but emanating primarily from the now completely rogue EPA), the fascistic Dodd-Frank "financial reform" legislation etc., all of which, individually, would have the effect of suppressing investment and entrepreneurship, but which together have created a vast blanket of investment suffocation over the entire economy.
One could also point to longer term trends that the present administration is either ignoring or actively encouraging, such as the re-inflation of the housing bubble, the looming collapse of Social Security, Medicare and Medicaid in the middle to end of the next decade, etc. One could name a number of issues here.
Again, supply-side theory has been shattered by recent history, as it was in full swing when our economy damn near collapsed.
"Supply-side" theory was no more in "full swing" then the recession hit than it is now, save for a few piddling tax cuts by an otherwise statist congress and President who were as wedded to Keynes as is Obama, but not at the same level of intensity. Supply-side theory was not even anywhere nearly fully deployed, even when Reagan was in office. Indeed, a Democrat controlled congress spent every new red cent generated by the massive expansion of the tax base at that time, and still deficit spent on top of that.
Wealth is anything that has value to someone. Basic necessities of life are examples of wealth. You really didn't know this?
However, a desert island is hardly a modern, complex economy.
Your attempt to move the goal posts, along with your extended question has no bearing on the fact that what I presented is a perfect example of wealth being created without capital. You asked, and I provided.
Yes, in a primitive, subsistence barter economy (the kind of economy usually approached when the theories of Karl Marx are actually taken seriously and driven to policy). What about a normative, modern economy?
If it makes you happier, let's suppose an entire cruise line was shipwrecked on the same island. Suddenly there is a market for your stockpile of food, shelter, weapons, gardening tools, etc. This becomes "capital" in every sense of the word because you can use it to purchase labor from those in the market for food and shelter. This is pretty much how human civilizations begin, which is why I bring it up. The question is which came first, and I think the answer is pretty obvious, even if you refuse to see it.
Kevin's analogy just doesn't work. This is an extremely simple, primitive barter economy, not a modern, complex economic system in which capital accumulation (money) is required to create the conditions under which new wealth can be created through productive activity. There is no "labor" or work at all as Graham has articulated it. The people on the island have at there disposal the already produced foodstuffs, tools, weapons, supplies etc that they need to survive for a limited period. They have not - and could not- produce those things for themselves on the desert island.
Only when they run out of supplies does the question of what comes first, labor or capital, arise, and there is capital all around them: trees, vines, rocks, fish in the sea etc., all in their raw, unprocessed form, and useless until human labor is attached to them and they are made valuable. A fish in the sea is of no value to a starving islander until it is caught. Sticks of no value until they are collected and sharpened into spears. Raw materials are just that until acting man modifies and processes them to make them useful to other human beings. Raw materials combined with labor creates ownership, and a medium of exchange for that which human's find to be valuable allows indirect exchange of a much more complex and valuable kind; subsistence lifestyles can now give way to substantial wealth accumlation and the concept of thrift, savings and investment in the creation of new wealth.
Oppressive taxes, regulation, inflation, vast tax and regulatory compliance costs, and an environment of pervasive animus emaniating from the center of the monopolization of coercive force - the state - shackles and suffocates such investment and hence, job creation, in the cradle.
Graham likes all of this because, ideologically, he is a strong supporter of exactly this: suffocating taxation and regulation. That's precisely and exactly what he believes in (as any perusal of his past posts defending and rehabilitating any number of long discredited, hoary Marxist cliches from the early 20th century will attest), what his ideology requires, and why his anti-capitalist animus is so strong, so irrational, and necessitates the gigantic falsifications of history that he and virtually all serious leftists must engage in to make their points.
My example was designed to prove the point that capital is not required for labor to create wealth.
Yes, in a medieval village or Apache campground, that's true.
To prove "capital" can be created from labor without preexisting capital, all I had to do was alter the scenario to include a market. It was quite simple really.
You've proved nothing, because your example is only relevant to economic and technological conditions that only ideologically true-believing environmentalists would even take a serious look at. In any economy approximating a modern industrial one of the normative variety that provides the high living standards for the vast majority associated with such economies, accumulated capital, and the
incentives to accumulate, save, and then risk that capital in productive entrepreneurial ventures is required.
I'm still waiting for you to explain for us how capital came into existence without labor.
That's the question of how money originated, which is a question about how human beings progressed from abject poverty as the norm (and the norm, to various degrees, that is always re-created by leftist economic policies, and especially those of the more utopian collectivist kind) to middle class affluence and a doubling of life expectancy as the norm, and from primitive direct exchange to complex indirect exchange.
Do you have any idea how many articles and discussions there has been about all the capital sitting on the sideline and not being invested because of current White House Admin policies uncertainties?
Tons, Joey. Its all over the Internet and in the major business media and literature. Kevin is in a prehistoric Marxist never neverland that is hermetically sealed off from history, empirical reality, and critical thought, all of which are required to understand political economy.
And the basics really aren't that difficult to comprehend, unless
ideology intervenes and destroys rational thought and the seeking of the truth as a core value.
This is all myth. Please explain how the White House has created fear in corporate America's desire to invest!
This has already been done here umpteen times, including at length by me. If you haven't been paying attention, or are simply to dull or to deranged by your need to maintain ideological purity to comprehend the rather simply economic and political-economic principles involved, the loss is on your head, not anyone else's.
