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Monday, January 8, 2018

Happy Days are Here Again!

** A Silverfiddle Post **

President Trump has unleashed the animal spirits of our economy. African American unemployment is at a record-low 6.8%.

Innovation + Productivity = Economic Miracle

Warren Buffett’s Time Essay gives us the most accurate and concise explanation of the economic miracle known as the United States of America. It is a message of hope that the greatest economic powerhouse the world has ever known will continue its unprecedented championship run.
“Two words explain this miracle: innovation and productivity. Conversely, were today’s Americans doing the same things in the same ways as they did in 1776, we would be leading the same sort of lives as our forebears.
“To all this good news there is, of course, an important offset: in our 241 years, the progress that I’ve described has disrupted and displaced almost all of our country’s labor force. If that level of upheaval had been foreseen–which it clearly wasn’t–strong worker opposition would surely have formed and possibly doomed innovation. How, Americans would have asked, could all these unemployed farmers find work?
“We know today that the staggering productivity gains in farming were a blessing. They freed nearly 80% of the nation’s workforce to redeploy their efforts into new industries that have changed our way of life.”
One of the many beauties of our nation is how our economy does organically “redeploy” workers to “new industries;” indeed that is one sign of a healthy, robust economy. Easy to do in boom times, but bad times leave cast-off workers mired in unemployment and despair. We are entering boom times, and we can’t allow all the hoopla to drown out the forgotten people.

Buffett closes his short essay with an optimistic challenge:
“The market system, however, has also left many people hopelessly behind, particularly as it has become ever more specialized. These devastating side effects can be ameliorated: a rich family takes care of all its children, not just those with talents valued by the marketplace.
“In the years of growth that certainly lie ahead, I have no doubt that America can both deliver riches to many and a decent life to all. We must not settle for less.”
I agree. How do we do this?

How do we "ameliorate" the "devastating side effects" and help those left behind catch up?

How do we build an America that will “deliver riches to many and a decent life to all?”

56 comments:

  1. This is from Politico:
    https://www.politico.com/magazine/story/2018/01/07/the-future-of-work-a-history-216244
    I thought of the discussion here on automation.
    This article point out at least a parallel threat.

    ReplyDelete
    Replies
    1. Ed,
      Excellent article! I finally found time to read it.

      Thank you for providing the link.

      Delete
  2. Simple. Either remove all tax incentives that give preference to the "corporate form" or require that corporations pay dividends to stockholder once they reach a certain size (say market cap of $1b).

    ReplyDelete
    Replies
    1. Please see my post of 9:03 AM. I believe it both supports and fleshes out your assertion.

      Delete
    2. What year do you propose that we "time travel" BACK to?

      Delete
  3. Let the Wizard of Omaha pay Berkshire Hathaway stock holders dividends instead of forcing them to sell their stock in order to cash in on appreciating stock values.

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    Replies
    1. No. - No. - NO. - NO! Heavens NO!
      Laissez-faire is THE way to go

      Government Control increases woe.
      Liberty makes THE most dough!

      To anyone who can at all be THINKING
      Class Warfare's known as ROTTEN STINKING!
      .

      Delete
    2. Really?

      Many corporations (like Microsoft) require that the federal government enforce "intellectual property" laws. DO you recommend that they stop doing so?

      Delete
    3. The point is, that freedom with no limits is a bellum omni contra omnes. Laissez-faire capitalism is the same. Limits are what turn freedom into a manageable "liberty". Should we go back to the mercantile (buy my opium or else China) days of laissez-faire capitalism?

      Delete
    4. Laissez-faire capitalism without a moral compass has wrought much poverty for others, IMO.

      Delete
    5. An upvote to AOW's comment.

      When the idea of a market economy was formally illustrated in Smith's Wealth of Nations the need for worker protection was integral.

      We are experiencing increased productivity. How was it achieved? Automation and depressed wages? Where do the productivity gains go?
      To fully answer this we must once and for all admit that the market economy should not be conflated with capitalism. We continue to weaken the very necessary moral compass.

      Delete
    6. By the way, capitalism is an economic system. It has no moral code.

      It exists only to generate profit and must be regulated.
      This will probably bring the naysayers screaming about freedom but to allow man to exercise his unregulated desires is clearly folly.

      Delete
    7. But here's the problem, Duck: the moral compass cannot be imposed by a government. And once the moral compass is imposed by a government, individuals shrug and "Let Uncle Sam take care of this." Meanwhile, the loopholes get a workout.

      I remember a time when "the well to do" in Northern Virginia voluntarily provided help for those who were poor or otherwise disadvantaged. That cohesion to the fabric of our community gradually ebbed away once all the social services came along.

      My parents could never have been described as rich. But in the 1980s, they went out of their way to stock the cupboards of my neighbors' kitchen when the head of that household of four lost his job; they also "found" work for the man: my parents' yard work, house repairs, etc. I remember Mom saying, "They need help more than we need a vacation."

      In my own observation, the rich today are snootier and more selfish than they used to be. Why? They have lost their moral compass.

      Delete
    8. Duck,
      By the way, capitalism is an economic system. It has no moral code.

      But individuals should have a moral code.

      It exists only to generate profit and must be regulated.

      You know that I strongly disagree with what you define as regulation. Regulations serve to cause the burgeoning of the governmental bureaucracy -- and thereby eroding individual liberty.

      Delete
    9. Automation is a sign of an "over-capitalized" economy.

      Delete
    10. Speedy, it's driven by a pressure to cut costs.
      Or by ergonomics to protect trained and skilled employees.
      I'm an Automation Engineer.

      Delete
    11. it's driven by a pressure to cut costs

      Yep, decreasing labour costs by increasing capital investment. I'm merely stating that perhaps this represents "excessive" capital investment (especially when people are out of work).

      Delete
    12. I have ALWAYS said that Capitalism ungoverned by a Christian Conscience –– like everythung else –– is apt to function as a Great Evil, but I would still stoutly maintain that whatever flaws may be inherent in Capitalism are minuscule in comparison to those found in Marxism and its many variants.

      IF we could ever bring ourselves to exercise the wit, will, wisdom –– and cherish the DECENCY –– to put Principle and Consideration for the Ramifications of our Actions –– above the Pursuit of Scientific Progress and Personal Profit, we would have the best chance possible of achieving an Ideal Society.

      However, since we are inherently flawed beings, and tend to be fractious and intransigent, things are what they are.

      NEVERTHELESS, when we WERE a much freer, more independent people who prized Faith, Courage, Optimism, Rugged Individualism and scorned Weakness and Dependency, we were in the main much stronger, healthier, more preductive, more easily contented, and far less self-absorbed and neurotic than we have become in the past hundred years.

      So, ANY form of endeavor NOT governed by a strong sense of morality and acceptance personal responsibility is doomed to come a cropper.

      The issue, therefore, is not Capitalism v. Marxism, but Self-Control guided by Principles of Decency v. Unbridled Hedonism and Reckless Disregard for the Well-being of Others.

      Delete
    13. ...and I understand the need for automation with un-manned space exploration, ordinance disposal or nuclear waste remediation.

      Delete
    14. ...and I'm suggesting that by setting certain "limits" and "rules" surrounding capitalism, you can minimuze (or at least contain) gross abuses.

      Delete
    15. "I have ALWAYS said that Capitalism ungoverned by a Christian Conscience –– like everythung else –– is apt to function as a Great Evil"

      Indeed. Adam Smith was more a moralist than an economist, and he believed this as well, as did the Founding Fathers.

      No system of morality = Hobbesean Dystopia

      The challenge is to find the middle way.

      Delete
  4. Delighted to see an UPBEAT, OPTIMISTIC article for a change. The continuous recital of Doom Gloom, Faultfinding and Complaint has had a crippling effect on our morale to say the least.

    It's high time we started once again in the words of an old Bing Crosby hit song to

    Ac-cen-tu-ate the Positive,
    E-li-mi-nate the Negative,
    Latch on to the Affrimative,
    And [stopped fooling] with Mr. Inbetween


    I'll try to answer your very imprtant questions with a well-considered, long-held opinion

    1. How do we "ameliorate" the "devastating side effects" and help those left behind catch up?

    Return to the former practice of hiring unskilled, under-privileged people on the bottom to perform the myriad MENIAL chores that must be done at competitive wages. This, of course, would have to mean eliminating the very idea of a Minimum Wage –– A Marfxian concept.

    2. How do we build an America that will “deliver riches to many and a decent life to all?"

    Again by reverting to the earlier system that first attracted millions of immigrants to The Land of Opportunity in the first place. It was the advent of PROGRESSIVISM, –– in truth a form of Marxian Collectivism ––, that brought us Unionism, the IRS, the Federal Reserve, an economy increasingly controlled, distorted, maimed, and crippled by Central Planning. Ywo World Wars –– the most desgtrucgtive in all frecorded history, and The Welfare-State mentality encapsulated the New Deal that effectively began our career as an increasingly socialistic society.

    Before Progressivism –– i.e. Cultural Marxism –– took over we were the freest, most increasingly prosperous, most upwardly mobile society the world had ever known with the highest standard of living on record.

    In the past hundred years we have been transformed into a Plutocratic Oligarchy, primarily BECAUSE Progressivism's unswarranted assault on Business literally FORCED the Captains of Industry to defend their interests by becoming PART of the government.

    This formed an incfeasingly corrupt, corrosive alliance decidedly antithetical to the best interests of the People as a Whole and to the Individual.

    Leftist ideology has infected us with this deadly, slow-acting poison.

    I don't know if it is possible to reverse the devastating effects of the past hundred years, but IF we truly WANT to improve our prospects and those of the average person, we ought to do out best got TRY to move in that direction.

    Mr. Trump appears to be doing ujst that with his sweeping recission of the majority of Obama's strangling regulatins, but Mr. Trump's efforts, good as they are so far, are only a drop in the bucket of what MUST be done if we are ever to right ourselves.

    Unionism and the other forms of Marxism have brought us INFLATION, and the diseased notion that The World OWES Everybody a LIVING.

    "From each according to his ABILITY, TO each according to his NEED."

    That prime tenet of the Communist Manfesto is at the ROOT of ALL leftist initiatives. The harm it has done is INCALCULABLE.

    ReplyDelete
    Replies
    1. FT,
      We do INDEED publish optimistic posts here at this site. It’s not all negative here.

      See my blog post of January 2 — and note the paucity of comments. **sigh**

      Delete
    2. Whatever made you think I was talking about THIS blog in particular, AOW?

      The whole COUNTRY has been awash in a turbulent OCEAN of BILE vomited up every hour on the hour every day by the Malignant Merchants of Malevolence and Mendacity. I has bred a climate of grim negativity that has had a depressing, degenerative effect on public confidence, and befouled the mood of the populace to the point where the avalanche of GOOD NEWS is OGNORED and seems to have little or no ameliorative effect.

      As a society we have been manupulated into becoming ADDICTED to endless DISPUTE and VILIFICATION
      .

      Kurt's post was a most welcome –– and all too rare –– RELIEF from the prevailing mood. I was expressing my gratitude to him, and making an honest attempt to answer his questions that was ALL.

      I cannot understand why you would think my observation had anything to do with you, PERSONALLY.

      Delete
    3. FT,
      Whatever made you think I was talking about THIS blog in particular, AOW?

      Well, because I have PERSONALLY grown weary of finding so many negative stories and so few optimistic stories about which to post. Sources in which I used to find uplifting stories seem to have degraded.

      I absolutely agree with this part of your above comment:

      As a society we have been manupulated into becoming ADDICTED to endless DISPUTE and VILIFICATION.

      How that manipulation was accomplished -- and continues to be accomplished -- is a discussion for another time.

      Delete
    4. "See my blog post of January 2 — and note the paucity of comments. **sigh**"
      30 comments is a paucity? I'm just glad one of them was mine.

      Delete
    5. "the very idea of a Minimum Wage [is] A Marfxian concept."

      It predates Marx considerably: the first minimum wage law in Britain was passed by Edward III in the mid-14th century.

      "...hiring unskilled, under-privileged people on the bottom to perform the myriad MENIAL chores that must be done at competitive wages."

      there's no way this can be economical. Automation / innovation has evaporated much of this work. Illegally underpaying immigrants is of course a gross market distortion and in itself unethical, but even once that were eliminated, a sense of scale should quickly convince you that there would still not be enough of that kind of work to make much impact on underemployment. SF is right: we need new industries.

      Delete
    6. I work in a highly automated plant.
      We have lines that go idle because we can't get people in to run them!
      You don't have to be a rocket scientist, either!

      Delete
    7. Ed,
      For this site, when fewer posts are published, 30= a paucity. **wink**

      Delete
    8. Ed,
      We have lines that go idle because we can't get people in to run them!

      Why can't you get people to man those lines?

      Delete
    9. No candidates, or unsuitable candidates? If the latter, what are they lacking?

      Delete
    10. Excellent discussion kicked off my a mini-thesis from Freethink!

      Jez: Indeed, we do "need new industries" in this new world of hyper-change.

      IT work is still good, if you can get it, but it hasn't met with the promise of glamour, riches or even excitement it once promised, according to the IT people I know. Wages have trended down and most of it is high-tech drudgery.

      Robotics and automation-related jobs will go down the same road of good solid work but not nearly as remunerative or exciting as the sci-fi cheerleaders had us believe.

      The solution, of course, is for governments to free people to explore new frontiers.

      Government can be a good cop, but bureaucracies possess infamously crabbed views and no imagination.

      No government can craft an economy as well as free peoples acting and reacting to signals in an intelligently-policed free market.

      Delete
    11. In what way aren't people free to explore new ideas?

      Delete
    12. I have in mind regulatory barriers to market entry.

      Not only is Goliath bigger than David, he now bellows out laughter from his impenetrable near-monopoly citadel built for him by government.

      We could also discuss frivolous state and local licensing requirements of industries like manicure and pedicures, etc.

      Point is, people with ideas and moxy drive economic growth and innovation, not governments. The better government is at fostering an environment of experimentation, the better the economy. The US is a prime example of that.

      Did Obama's "Weathering" teams ever get all the nation's windows caulked? They haven't visited my house yet.

      Delete
    13. I don't know why we can't get people.
      I have hired (and HR had fired over drug tests) people who seemed qualified. Others play a game of chasing higher wages. Those are technicians.
      Operators just need math skills, good attitude and drug free screens.
      We have good operators running robotic laser welding cells with high school educations. They do minor troubleshooting, loading and unloading, documenting production, forklift, etc.

      Delete
    14. Ed,
      Is the drug problem that bad?

      Which drugs are the drug screens monitoring?

      Delete
    15. Pot, Meth, Opiates, but I'm never told what they found.
      Hair clipping goes back 6 mos. One mistake in 6 mos....

      Delete
    16. I can see a hair test catching a lot of people for pot, and I've heard of opiate tests lacking specificity, eg. testing positive for benign dosages, see https://www.snopes.com/medical/drugs/poppyseed.asp . I just looked up meth tests, and I see that false positives can be caused by a wide range of common anti-depressants and common remedies (including ibuprofen and sudafed, which I use fairly often).

      I would suggest that HR shouldn't screen for pot (monitor for behaviour, not chemicals!), and not place too much trust in the other tests. Meanwhile, I hope candidates can contest those screens.

      Delete
    17. Jez, I agree on the pot.
      My dad left me a lot of Tylenol-4s before he died.
      I would take them occasionally if I felt needed, and my niece living with us took them for cramps.
      Now I could loose my job if I did that.

      Delete
    18. These extremes with regard to drug control will not work -- except to exacerbate the real drug problems (addiction).

      Taking a pain killer from time to time does not constitute a drug problem.

      Delete
    19. I'm fairly libertarian (fully automatic machine guns should be sold in vending machines) but meth manufacturers should be put to death along with anyone that disagrees that they should be put to death.

      Delete
    20. TC,
      Meth devastates the users and their families.

      I've personally known only one person who managed to kick the meth habit. It took the loss of her oldest child, who walked away at age 14 and went to live with her grandmother, and the dissolution of her marriage to bring her to her senses.

      She has left the stuff alone for about 10 years now. "Relapse" is always a possibility, though.

      Delete
  5. From Ed's referenced article:

    "Or maybe it won't be necessary to work as long and hard as we all seem to do today"


    Also consider: https://eh.net/encyclopedia/hours-of-work-in-u-s-history/


    It seems axiomatic, to me, that with continued increases in mechanization the above quote is undeniable.






    ReplyDelete
    Replies
    1. Thanks for reading the link Jon.
      I got from it (although a lib point) that the bigger threat to middle class is that everyone goes part time.
      Retail and service is almost all there already.

      Delete
  6. SF,
    How do we build an America that will “deliver riches to many and a decent life to all?”

    De-regulations and tax cuts should be a large part of that amelioration, IMO. President Trump seems to be moving in those directions.

    BTW, I heard from my tax accountant over the weekend. Great news! Very likely, I will at long last be able to stop the time-consuming record keeping that has been necessary for the past several years -- in particular the record keeping related to tallying medical expenses.

    Every tax cycle beginning with Tax Year 2009, I have spent innumerable hours and endured great angst with that kind of record keeping.

    ReplyDelete
  7. With the coming smart robotics revolution, the result of AI (artificial intelligence) the way we think about work, how we value work, and how we find self worth related to our work will need to change. Significantly so.

    ReplyDelete
  8. How do we "ameliorate" the "devastating side effects" and help those left behind catch up?

    We don't. Let them starve to death.

    Oh jeez. Fine. Give them jobs digging graves.

    ReplyDelete
    Replies
    1. I got mine. F*** everybody else. You should be the spokesperson for the Repuglican Party.

      Delete
    2. The Boys from the Country ClubJanuary 8, 2018 at 11:39:00 PM EST

      Oh! Ha Ha! Such humour never fails to crack up "thought criminal's" fellow fat ass old men in the shower room!

      Delete
    3. Many on the "Religious Right" are neither.

      Delete
    4. Yes yes, next you libs will scheme to get every high school football player into the NFL. Gold stars for showing up, regardless of work, acheivement or skill.

      F*** off, commie.

      Delete
    5. f*** OFF, COMMIE. The only retort the fascists have. Bwahahaha!

      Delete
  9. Let the Dirt Begin!
    SCANDAL: OPRAH’S WORLD DEPOPULATION SCHEME DASHES PRESIDENTIAL HOPES
    Oprah met secretly with Soros, Rockefeller to discuss population reduction

    ReplyDelete
  10. OFF TOPIC BUT PERSONALLY SIGNIFICANT TO ALL WHO KNOW AND LOVE Z.

    __ Happy Birthday to a Special Friend __

    Happy Birthday to you, blogging neighbor,
    A woman with a conscience and a heart.
    Put down your burdens; cease all heavy labor;
    Put up your feet. The party soon should start.
    You’ve earned a break, a restful change of pace.
    Before you pleasing prospects should expand.
    It’s time to smell the flowers, leave the race,
    Relax, enjoy the wonders close at hand.
    Travel –– unashamed pursuit of pleasure ––
    Holds great promise too. You’ve long deserved
    Delight and deep contentment beyond measure
    After all the years that you have served.
    You mustn’t feel you ought to act your age.
    To You the time has come to dance, perhaps offstage.


    ~ FreeThinke - 1/9/18

    ReplyDelete

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