View Full Version : NYT: Even Critics of Safety Net Increasingly Depend on It
Fascinating Article from the NYT (http://www.nytimes.com/2012/02/12/us/even-critics-of-safety-net-increasingly-depend-on-it.html?_r=2&pagewanted=all%3Fsrc%3Dtp&smid=fb-share), with this being the most relevant quote:
But Dean P. Lacy, a professor of political science at Dartmouth College, has identified a twist on that theme in American politics over the last generation. Support for Republican candidates, who generally promise to cut government spending, has increased since 1980 in states where the federal government spends more than it collects. The greater the dependence, the greater the support for Republican candidates.
Conversely, states that pay more in taxes than they receive in benefits tend to support Democratic candidates. And Professor Lacy found that the pattern could not be explained by demographics or social issues.
I wonder if it can be explained by the idea that most individual voters have no idea how much their state gives or gets from the federal govt.
On a related note, it tickles me that on another site I go to there are people very opposed to things like food stamps, but they use the mortgage interest deduction and either collect social security or plan to.
I think that the tax someone pays is an abstraction for many in the US.
I think there are a lot of abstractions for people in the U.S. Like the true cost of a gallon of gas, externalities involved in buying that $10 chinese-made toaster oven, etc. That's why politicians make out - literally - like bandits. All they have to do is explain the desired viewpoint in language that relieves citizens of the need to think on their own, and they're good to go.
We have a close friend who votes a straight conservative ticket. This year, he's been out of work for several months and has nowhere to go if his unemployment benefits run out. Does that change his intended behavior in the voting booth? No, of course not. I just want to tell him sometimes, "Lloyd, don't you know your party thinks you're simply a lazy no-good slacker on the public dole, and wants to cut off your unemployment checks as soon as possible?" But hey, it's not my problem, it's his.
Well, you know, I kind of thing it is "our" problem. I mean, so long as people keep voting out of ignorance, and we are functioning generally on a "majority" system, the rest of us are effectively screwed by other people's stupidity.
*please note that I mean actual ignorance and stupidity, not that any one way of voting is per se ignorant or stupid. i vote candidates, and based on how it will impact the judicial system, NOT parties.
We have a close friend who votes a straight conservative ticket. This year, he's been out of work for several months and has nowhere to go if his unemployment benefits run out. Does that change his intended behavior in the voting booth? No, of course not. I just want to tell him sometimes, "Lloyd, don't you know your party thinks you're simply a lazy no-good slacker on the public dole, and wants to cut off your unemployment checks as soon as possible?" But hey, it's not my problem, it's his.
But he probably understands that the answer to unemployment is not increasing entitlements. It's using economic incentives to spur job growth, making his entitlement un-necessary.
With that understanding, he probably chooses to vote his, and others, interests and reject partisan hyperbole.
Like taking an austrian perspective of the economy? please? pretty-effing-please? Oh wait, that would require some government regulations on things.
Wonder why Ron Paul likes it so much? Wonder what that is all about.
How about the original article -- all these folks don't want entitlement, but all these folks are using entitlements, and if you take away their entitlements, they apparently start crying (not saying it's true).
They want republicans, but not real economic policies that have been demonstrated to work. Anyway, Ron Paul is looking way more realistic as a true candidate by the day. How come everyone is focused on the other potato-heads? They just seem like "We aren't democrats but we want big government, but without any benefits to the people"-cans
But he probably understands that the answer to unemployment is not increasing entitlements. It's using economic incentives to spur job growth, making his entitlement un-necessary. With that understanding, he probably chooses to vote his, and others, interests and reject partisan hyperbole.
IMHO, it's both. Just as one needs immediate assistance to get the immediate bills paid for, one also needs long term opportunity. I certainly have been very very glad when a job ends to have unemployment insurance to catch me as I look for another position. I've collected UI many times over the course of my working life. And, I have paid into that fund, along with my former employers.
The best of who we are, as a species, as communities, and as a nation is that we help each other out when needed. UI is that.
Good point, red fox -- why isn't it or can't it be a both/and?
The reality is, some of our programs -- like medicare -- have done *wonderful* things for our country. In particular, it and social security have kept people out of abject poverty in their golden years. barely above poverty for some, but at least not abject poverty.
Perhaps that's part of the conversation. Where is the line? Where are we -- as a community -- willing to say "this level of poverty is ok?" right now, I think that bar is set pretty low. These systems are designed to maintain a larger middle class, in all honesty, and avoid the pains (social and otherwise) of abject poverty. Sure, there will still be an 'underclass' -- but not abject poverty.
Perhaps the term "abject" is subjective. Perhaps that can be defined.
Zoebird - this is so classic!
I grew up in a state that KNOWS poverty, public education stinks and if it weren't for Acronymed Entities (gov. related employers) and therefore Gov Contracted private companies or the City/County Building Good Ol' Boy (and Girl) System --- No One would have a job!
There used to be some manufacturing where I grew up -- Gone.
(I guess everyone is supposed to work at a convenience store or Walmart now if you don't have a hook up?)
Yet - it is as hard-core, TeaParty conservative as it can be - or at least they seem louder than all the rest ..... I just want to scream "Don't you realize our community is propped up by gov spending!"
Like the politicians--senators and members of congress--who rail against single-payer health care for the rest of us while benefiting from their own. Tea Partiers ditto, if they're old enough for Medicare.
There are two complementary and equally ridiculous accusations of hypocrisy the left and right like to hurl at each other. The first we see here. We are told that anyone who accepts a benefit that we are required to pay for somehow forfeits the right to criticize the benefit or its provider. This might be valid if we were able to order our government a la carte; but since we have no choice but to buy the whole package (paying for them in taxes, debt and the “externalities” driven by government interference) it seems silly to me that a person wouldn’t take what they could.
The second, more frequently used by the right against the left, is to invite anyone claiming that more taxes are required to mail a check to the Treasury. This is foolish for much the same reason as the first. Absent choice, doing the best you can in the system as currently imposed strikes me as rational behavior.
But he probably understands that the answer to unemployment is not increasing entitlements. It's using economic incentives to spur job growth, making his entitlement un-necessary.
With that understanding, he probably chooses to vote his, and others, interests and reject partisan hyperbole.
What is the difference between an economic incentive and an entitlement? And when they are sitting together in a cash register how does one tell them apart?
I think the real question of the article is "what is the solution?"
Here is the way that it seems to roll out: cut spending or create income (raise taxes). What if we did something increasingly radical and do both? And then, guess what? look at what we can streamline and so on again?
First, I think it's a good idea for the bush tax cuts to go through their last two years and fall away. It's not fiscally viable right now, to be honest. If the most important thing is to get to a balanced budget and get rid of the deficit, that will help.
Second, we need to take a hard look at our government. We need to look at groups like Homeland Security -- is this organization functional or redundant? Did it create something valuable that is useful, or is it just one expensive cog that was already managed between other agencies and organizations?
We need to look at military spending. It's 20% of our budget -- same as medicare/aid/CHIP. But, that 20% doesn't include homeland security, FBI aspects related to the military, military R&D, veterans affairs, pensions and so on. It is mostly for the standing army, housing for families, and the wars/"operations." We need to seriously consider how many times we can go out to movies and dinner in our current state. And really ask ourselves "is this really about national security?" or perhaps even "how are we defining national security at all?"
For me, national security and a balanced budget go hand-in-hand.
I grant, we do need to look at medicaid, medicare, chip, and social security (41% of the budget). These need to be looked at very, very clearly, and we need to determine where there is "pork fat" and where there isn't. Is administration of the program more expensive than the benefits of the program itself? Would there be a more effective method? And of course, how do we overcome or stop corruption within the system?
The remainder is looking at all kinds of things from research to arts grants to transportation and so on.
IF we, as a nation, decided that it was time for us to do what a lot of us on here have done -- taken on extra jobs, saved up, lived simply -- and gotten this deficit taken care of, then guess what?
In a few years down the track, we can look at it and go "right, this is what we can do." we can look at ways to make what we offer more efficient, or offer things in a better way, or simply let something go if we no longer value it as a nation. we can cut taxes as well, so that we have a "lean mean machine" of a government that does what we want it to do.
I know, I know. It's a pie in the sky.
But seriously, we either want to solve this problem or we don't. And I think doing BOTH would probably be a damn good start.
mtnlaurel
2-15-12, 12:41am
Seriously, let's just fix it. It's called gray --- it's not going to be Just Black or Stark White.
Zoebird, thank you for posting this article I read it late last night finally after initially shooting off about the quote in the OP.
It's just heartbreaking to me.
There is Mr. Gulbranson busting his hump and his five kids couldn't do their sports if they weren't on free breakfast/lunch.
Are sports/extraciriculars a necessity of life -- No. Have extracurriculars become ridiculously expensive and too complex -- Yes.
But I am sure one could easily find studies supporting the positive effects of extracurriculars on children's success and helping to keep them on the straight and narrow.
People do not want hand outs. They want jobs, good jobs. And then better jobs if they've gone to the trouble/expense to learn a well paying trade.
They want a strong economy ..... it is coming back, right?
Without jobs and the hope that things will be better for future generations, we get cranky.
Why does the Evil One have to be the Government?
If you divorce yourself of political ideology, it just makes sense that when a huge segment of the consumer population has what little bit of wealth they have tied up in Housing and the bottom falls out of it then there is hell to pay all over the place.
(Point noted that it seems to have been driven off a cliff by some greedy, scheming people with the unknowing help of dreamers that think everyone needs to own a home)
On the flip side, Corporations do not give a hoot about the United State of America and it's not that they are bad or evil (debatable by some I'm sure), their mission is to make money and increase value for shareholders. And now that there are burgeoning consumer classes in other areas of the world outside of the West.... they may not care as much about us as they once did, they've got markets to open. Not because they are mean, it's just the facts of life.
My Pie in The Sky Plan would be that for 6 months we could put a moratorium on social issues, ban politicians from viewing their favorability ratings, turn down the volume on Fox/Rush/MSNBC/Huffingtom Post and turn up the volume on C-Span feed, send each senator and representative a calculator and lock them in the Capitol building until they come to terms with what REALLY needs to be done to get out of this mess. And probably some strict limits on lobby/special interest access. Just for 6 months and then we can go back to the usual - but they have to produce.
Please stop preening in front of the cameras and get yourself in those meetings/hearings/whatever you do and get after it.
And I don't mean stop talking to the citizens, maybe put their press release podiums in front of the Lincoln Memorial and if they start talking in Orchestrated Talking Points or Sound Bites the stage trap door ejects them into the Reflecting Pool ... like a dunk tank.
It seems to me that the current President is more than happy to play ball. He really doesn't seem to be the Che Guevara that so many are trying to paint him to be.
In my job all I did was negotiate back and forth between two parties until you got to the workable solution that would produce the desired result.
Person 1 wants D, Person 2 wants L --- ok, let's look at the options E through K play them out and see which various combination of those is going to get our group desired result and then execute.
On a personal note -- I've said it here before the Earned Benefit of Unemployment Insurance saved my family during my husband's unemployment stint from fall 2008 to spring of 2010.
Could DH have gotten a lower paying job right off the bat, maybe (at some points even that seemed overly optimistic)
But he was able to hold on just long enough and persistently stayed after it and had the good fortune to get an even better paying job than the one he lost and thereby keeps us in the Contributors category.
Of course I think that's gov $ well spent because it saved our hides* and the way things go in the work place, we were so afraid that he would never get back to his earlier salary if he took a lower paying job.
(*Edit to Add - the unemployment + our emergency fund that we had saved)
flowerseverywhere
2-15-12, 7:16am
Very interesting article.
Like the article noted, all this buying coffee out, tattoos etc. have become the norm, not luxuries. Kids getting free lunch while participating in expensive extra curricular activities. Is this a sustainable model?
One problem it doesn't mention is this. My kids graduated from university just about debt free because we both worked full time and took extra call while going without eating out etc. I don't regret it one bit. Now they are working professionals and both live in nice neighborhoods with well paid neighbors and friends, most with two decent earners in the family. But you know what I see? Many are childless and plan to remain so, or have one or two children. They talk about things like saving in a 401K and 529's for the kids, paying off debt, paying off houses. In my neighborhood I see the same thing.
In the meantime one of my nurse friends works in an inner city school and another works in a welfare office. You know what they see everyday? Teenagers having babies, women coming in with three or four kids with separate baby daddies they never married. Of course they see well meaning people who have fallen on bad times, but there is a huge mass of people who will never pay into the system anything close to what they take. The US high school on time graduation rate is in the 70's percentile. How can you ever plan to support a family without a high school diploma? And the statistics continually show that people are not saving for retirement, or making plans to live debt free.
so I think as time goes on we'll have a shrinking class of the educated, the earners, the contributers and a burgeoning class of the dependent. There are many exceptions to my unscientific theory, but the trend seems to be in place.
And there is a reason there is no manufacturing in this country. The large majority of people only look at price, now how something was manufactured. Was that new blouse manufactured in a factory where someone got a decent wage or overseas in who knows what conditions? As a quilter and seamstress there is a small pool of people who will pay me to make something of quality when you can run to a box store and buy cheap crap for 1/4 or 1/6 of what I would charge.
...to invite anyone claiming that more taxes are required to mail a check to the Treasury. This is foolish for much the same reason as the first. Absent choice, doing the best you can in the system as currently imposed strikes me as rational behavior.
I've been guilty of that. You are right, good point.
I think the real question of the article is "what is the solution?"
Here is the way that it seems to roll out: cut spending or create income (raise taxes). What if we did something increasingly radical and do both? And then, guess what? look at what we can streamline and so on again?
First, I think it's a good idea for the bush tax cuts to go through their last two years and fall away. It's not fiscally viable right now, to be honest. If the most important thing is to get to a balanced budget and get rid of the deficit, that will help.
Second, we need to take a hard look at our government. We need to look at groups like Homeland Security -- is this organization functional or redundant? Did it create something valuable that is useful, or is it just one expensive cog that was already managed between other agencies and organizations?
We need to look at military spending. It's 20% of our budget -- same as medicare/aid/CHIP. But, that 20% doesn't include homeland security, FBI aspects related to the military, military R&D, veterans affairs, pensions and so on. It is mostly for the standing army, housing for families, and the wars/"operations." We need to seriously consider how many times we can go out to movies and dinner in our current state. And really ask ourselves "is this really about national security?" or perhaps even "how are we defining national security at all?"
For me, national security and a balanced budget go hand-in-hand.
I grant, we do need to look at medicaid, medicare, chip, and social security (41% of the budget). These need to be looked at very, very clearly, and we need to determine where there is "pork fat" and where there isn't. Is administration of the program more expensive than the benefits of the program itself? Would there be a more effective method? And of course, how do we overcome or stop corruption within the system?
The remainder is looking at all kinds of things from research to arts grants to transportation and so on.
IF we, as a nation, decided that it was time for us to do what a lot of us on here have done -- taken on extra jobs, saved up, lived simply -- and gotten this deficit taken care of, then guess what?
In a few years down the track, we can look at it and go "right, this is what we can do." we can look at ways to make what we offer more efficient, or offer things in a better way, or simply let something go if we no longer value it as a nation. we can cut taxes as well, so that we have a "lean mean machine" of a government that does what we want it to do.
I know, I know. It's a pie in the sky.
But seriously, we either want to solve this problem or we don't. And I think doing BOTH would probably be a damn good start.
This is so true. We do need to do both, but, not to beat a dead horse, the republicans in congress now don't want to play. At all. President Obama offered them 10 to 1 in a budget and they refused. He offered them 10 dollars in cuts to 1 dollar in increased revenue, and they walked away. Well, John Boehner saw the wisdom of the deal, but couldn't convince the not-ready-for-prime-time tea partiers, or the job 1 old timers. Here was a deal that gave the republicans 90% of what they wanted, and they said, nope, we want 100%, but even then we want you to also kiss our asses. But bottom line is, they don't want the economy to succeed cause then they won't get job 1, which is power, at any cost. It isn't enough that they win, but the other side must lose.
So really, I think the thing to do would be to vote out anyone who was stupid enough to turn down this 10 to 1 deal, cause, this person either isn't smart enough, or doesn't care enough.
There are two complementary and equally ridiculous accusations of hypocrisy the left and right like to hurl at each other. The first we see here. We are told that anyone who accepts a benefit that we are required to pay for somehow forfeits the right to criticize the benefit or its provider. This might be valid if we were able to order our government a la carte; but since we have no choice but to buy the whole package (paying for them in taxes, debt and the “externalities” driven by government interference) it seems silly to me that a person wouldn’t take what they could.
The second, more frequently used by the right against the left, is to invite anyone claiming that more taxes are required to mail a check to the Treasury. This is foolish for much the same reason as the first. Absent choice, doing the best you can in the system as currently imposed strikes me as rational behavior.
+1
What is the difference between an economic incentive and an entitlement?
In their purest form its kind of like the difference between giving a man a fish and teaching him to fish. An economic incentive should be geared to strengthen the economic base of a defined area. Take the Rust Belt, for example. Unemployment is high and times are hard at least partly because so much manufacturing has left the area. If the various levels of government involved would work together to create (economic) conditions there that are more favorable than in other places some form of industry would return. It wouldn't be easy because some of the "other places" are places like China, Sri Lanka, etc. Also, the new industry probably would not look like the steel mills of old, but nonetheless jobs would return if there was an advantageous climate for business.* I can't think of any US company that would rather have their manufacturing based in China vs. having it at home in the US. They only do it for economic reasons.
Most of what we are talking about in this thread involves temporary assistance like unemployment insurance. I don't think anyone here is opposed to having a UI program, the debate usually just centers around how to administer it. Entitlement is, IMO, a word that carries a lot of baggage and rightfully so. When we start to talk about programs that provide "benefits" for years and even generations it seems like we should be able to easily identify the issues. If you want to guarantee a person, or an entire class of people, will keep coming back to you all you have to do is set up a system that gives them just enough to survive until the next handout. We've done a great job of social engineering along those lines. Perhaps its time to rethink our methods and to define some new goals.
*That does not mean you have to give the farm to business as some would have us believe. It simply means setting up a scenario where costs of doing business at home are roughly equivalent to costs of doing business half way around the world.
flowerseverywhere
2-15-12, 10:15am
If you want to guarantee a person, or an entire class of people, will keep coming back to you all you have to do is set up a system that gives them just enough to survive until the next handout. We've done a great job of social engineering along those lines. Perhaps its time to rethink our methods and to define some new goals.
*That does not mean you have to give the farm to business as some would have us believe. It simply means setting up a scenario where costs of doing business at home are roughly equivalent to costs of doing business half way around the world.
Two great statements.
What would break the chain for those who are more in the entitlement phase than the contributing phase? Even if you pay high taxes you are likely to benefit from schools, road maintenance, travelling over bridges for example and possibly subsidized health care in the form of medicaid if you are over 65 and collecting on social security. Right now if you never worked and have been married to someone who has you get a benefit for example, is that sustainable? Would you cut or limit food stamps? School subsidized lunches? Length of unemployment beyond 12 or 16 weeks? Cash benefits to those who are not working? Subsidized housing? Medicaid? What would happen to those people if we did that as a nation?
for the second, do you honestly believe tax breaks will even the equation of doing business in a third world country? I am not sure about that, but I can find no supporting evidence. Workers comp insurance, liability insurance, Osha, wages with benefits all contribute to the high cost of manufacturing in the US. ( not a bad thing) I have tried to find a good reference for what it is like financially for people who manufacture all this stuff in China in terms of working conditions and wages but I am not sure if I am searching improperly or there is little data.
In their purest form its kind of like the difference between giving a man a fish and teaching him to fish. An economic incentive should be geared to strengthen the economic base of a defined area. Take the Rust Belt, for example. Unemployment is high and times are hard at least partly because so much manufacturing has left the area. If the various levels of government involved would work together to create (economic) conditions there that are more favorable than in other places some form of industry would return. It wouldn't be easy because some of the "other places" are places like China, Sri Lanka, etc. Also, the new industry probably would not look like the steel mills of old, but nonetheless jobs would return if there was an advantageous climate for business.* I can't think of any US company that would rather have their manufacturing based in China vs. having it at home in the US. They only do it for economic reasons.
Most of what we are talking about in this thread involves temporary assistance like unemployment insurance. I don't think anyone here is opposed to having a UI program, the debate usually just centers around how to administer it. Entitlement is, IMO, a word that carries a lot of baggage and rightfully so. When we start to talk about programs that provide "benefits" for years and even generations it seems like we should be able to easily identify the issues. If you want to guarantee a person, or an entire class of people, will keep coming back to you all you have to do is set up a system that gives them just enough to survive until the next handout. We've done a great job of social engineering along those lines. Perhaps its time to rethink our methods and to define some new goals.
*That does not mean you have to give the farm to business as some would have us believe. It simply means setting up a scenario where costs of doing business at home are roughly equivalent to costs of doing business half way around the world.
But aren't entitlements an economic incentive in themselves? If you live in a city where you have (just to throw a number out) $1 million paid out in UI, food stamps, SS, etc, the folks receiving those will have probably purchased about $1 million in goods and services by the end of the month and businesses will be sitting on $1 million in receipts.
One thing that really scares me is people talk like they believe the entitlement starts and ends with the person receiving it. Yanking that money is going to affect many more people than those directly receiving it.
I read an article in CNN recently about manufacturing jobs (primarily for small business demands) that are coming back to the US. China is not as good a model for smaller scale stuff anymore, because of rising costs there, rising shipping costs, and just not wanting to do small stuff anymore, so more is being done here. This is the type of thing economic incentives should be focused on, but since these small businesses do not have the same presence in Washinton the big players do, it's not going to happen.
mtnlaurel
2-15-12, 12:25pm
But aren't entitlements an economic incentive in themselves? If you live in a city where you have (just to throw a number out) $1 million paid out in UI, food stamps, SS, etc, the folks receiving those will have probably purchased about $1 million in goods and services by the end of the month and businesses will be sitting on $1 million in receipts.
One thing that really scares me is people talk like they believe the entitlement starts and ends with the person receiving it. Yanking that money is going to affect many more people than those directly receiving it.
I read an article in CNN recently about manufacturing jobs (primarily for small business demands) that are coming back to the US. China is not as good a model for smaller scale stuff anymore, because of rising costs there, rising shipping costs, and just not wanting to do small stuff anymore, so more is being done here. This is the type of thing economic incentives should be focused on, but since these small businesses do not have the same presence in Washinton the big players do, it's not going to happen.
+1
One thing that really scares me is people talk like they believe the entitlement starts and ends with the person receiving it.
Oh, UNLESS you're talking about the corporate entitlement culture. Give a corporation another tax break or loophole, and the trickle down economists just about wet themselves with praise for how it's going to benefit us all. But put actual dollars in the hands of people who buy actual products from these same corporations, and it doesn't seem to count. It's so pitiful and so transparent. :devil:
But aren't entitlements an economic incentive in themselves? If you live in a city where you have (just to throw a number out) $1 million paid out in UI, food stamps, SS, etc, the folks receiving those will have probably purchased about $1 million in goods and services by the end of the month and businesses will be sitting on $1 million in receipts.
The problem is that the original $1 million would have (generally speaking) come from the taxes paid by those same businesses and their owners who later generated the receipts. What you said is true, its just an extremely inefficient way to get there and some would go so far as saying its unfair if its anything beyond a very short term cycle.
One thing that really scares me is people talk like they believe the entitlement starts and ends with the person receiving it. Yanking that money is going to affect many more people than those directly receiving it.
I can't speak for everyone, but I don't see why we need to cut off the checks to anyone who is in need. The idea is to find ways to eliminate the need in the first place. If someone has a job at a good living wage they shouldn't need food stamps and obviously shouldn't be drawing unemployment. We need to start curing the disease instead of just treating the symptoms.
for the second, do you honestly believe tax breaks will even the equation of doing business in a third world country? I am not sure about that, but I can find no supporting evidence. Workers comp insurance, liability insurance, Osha, wages with benefits all contribute to the high cost of manufacturing in the US. ( not a bad thing) I have tried to find a good reference for what it is like financially for people who manufacture all this stuff in China in terms of working conditions and wages but I am not sure if I am searching improperly or there is little data.
No, I don't believe tax breaks should be any more than part of an overall plan and I think you're exactly right why they won't be enough by themselves. The levels of government involvement weigh our economic sector down to the point that it is difficult to be competitive. Talk of smaller government inevitably brings cries of what less regulation will do. It's not necessarily less regulation that we need, its better and more efficient regulation. Less levels and less paper, well defined rules and penalties for breaking them. We also need to think about what kind of jobs we want to attract. Do we want to simply regain the lost widget manufacturing jobs or do we want to go for something a little more futureproof? A package of economic incentives can be targeted to do that.
The problem is that the original $1 million would have (generally speaking) come from the taxes paid by those same businesses and their owners who later generated the receipts. What you said is true, its just an extremely inefficient way to get there and some would go so far as saying its unfair if its anything beyond a very short term cycle.
I can't speak for everyone, but I don't see why we need to cut off the checks to anyone who is in need. The idea is to find ways to eliminate the need in the first place. If someone has a job at a good living wage they shouldn't need food stamps and obviously shouldn't be drawing unemployment. We need to start curing the disease instead of just treating the symptoms.
How do you get the "good living wage" part? Force it? Corporations would rather go to Foxconn to get their stuff built and keep the rest as profits.
I agree that entitlements and taxes thing (although those taxes are also coming from the consumers) is not a great way to do it - but sometimes I wonder if it's one of those "but it's better than all the others" scenarios. Teaching everyone to fish doesn't help much if one person owns all the fish. It seems like a big piece of our economy is really driven by the government taking money and putting it back in play. Which really isn't fair - but waiting on banks and corps and the 1% to create jobs because they are waiting for consumers to have enough money to spend first isn't working very well, either.
I agree that entitlements and taxes thing (although those taxes are also coming from the consumers) is not a great way to do it - but sometimes I wonder if it's one of those "but it's better than all the others" scenarios. Teaching everyone to fish doesn't help much if one person owns all the fish. It seems like a big piece of our economy is really driven by the government taking money and putting it back in play. Which really isn't fair - but waiting on banks and corps and the 1% to create jobs because they are waiting for consumers to have enough money to spend first isn't working very well, either.
The one thing that argument seems to assume is that the 1% or the Fortune 500 or whoever controls large amounts of capital is ok with just sitting on it and that's just not the case. It is true that having some cash on hand leads to a better night's sleep for most of us, CEO's and SL'ers alike, but beyond that cash is a terrible investment. Corporations and individuals with above average means almost always want to invest cash in something (aka...spend it). I think most controllers of capital understand that it is up to them, not the consumer, to make the first move. That 'something' they invest in is what creates jobs which creates income for consumers and generates tax revenue at multiple levels. That is, of course, how the government redistributes money. We also often get sidetracked because the motivation of those with money is sometimes simply a desire to make more money, but should that really matter? It's not a perfect system, there's no such thing, but it does work.
The one thing that argument seems to assume is that the 1% or the Fortune 500 or whoever controls large amounts of capital is ok with just sitting on it and that's just not the case. It is true that having some cash on hand leads to a better night's sleep for most of us, CEO's and SL'ers alike, but beyond that cash is a terrible investment. Corporations and individuals with above average means almost always want to invest cash in something (aka...spend it). I think most controllers of capital understand that it is up to them, not the consumer, to make the first move. That 'something' they invest in is what creates jobs which creates income for consumers and generates tax revenue at multiple levels. That is, of course, how the government redistributes money. We also often get sidetracked because the motivation of those with money is sometimes simply a desire to make more money, but should that really matter? It's not a perfect system, there's no such thing, but it does work.
But you keep looking at it from the trickle down viewpoint. Which , in reality, doesn't work. No amount of capitol, or incentives, or tax breaks, or whatever, is going to entice that investor into making more widgets if there simply isn't a market for it. None. If people don't want to buy purple widgets, no smart investor is going to invest in purple widgets, period. Giving all these breaks to the wealthy (who aren't job creators, as it turns out) doesn't do squat. Making more widgets won't cut it if no one is buying. And no one is buying as long as they don't have the money to buy the unnecessary widgets. And who is buying all the widgets? Well the middle class is buying, or rather were buying, before the squeeze. (The wealthy are having their widgets custom made, therefore aren't really part of the market equation.)
So, this trickle down crap resembles Communism more than anything. What brought down Communism? Not guns or power or force of ideological will, or even St. Reagan, but the weight of their own ideological inefficiency. Bread lines were formed because they tried to manage from the top down. We will make 1000 loaves of bread today because this is what we think they will want, when in fact the MARKET DEMAND wanted 1500 loaves.
Giving all the breaks to the top 1% so they can 'create jobs' making loaves of bread ignores how many loaves of bread are actually needed and if the people can afford the loaves when they are baked. But in this country, companies are not compelled to make any loaves of bread, and if there simply aren't enough people buying, then a smart business man won't bake them. He'll hold his money until more people want bread, and have the money to buy it. Perhaps, if the middle class wasn't being squeezed out of existence, there would be more people buying bread and wanting bread, making the bread makers very wealthy and happy.
OK, enough rant. I'm hungry for some bread and butter, which I baked myself cause I can't justify the cost of the pasty white crap they sell in the stores! Demand and supply!
But you keep looking at it from the trickle down viewpoint. Which , in reality, doesn't work.
But I'm trying to come up with something that isn't trickle down. I also believe that in that situation every level is going to siphon off what they can on the way down. It isn't something evil, its just human nature. What I'm suggesting is incentives that create jobs. There is nothing wrong with the actual incentive being assigned AFTER the jobs are created. Maybe even something so bold as (ONLY for example, not real numbers)... Give any employer a tax credit of $10,000 when they create a new position that keeps someone employed for the entire tax year. That way the corporations, the rich, the 1%, whoever is in charge has to put up something before they collect the benefit. Yes, whoever creates the position gets a benefit. Is that worth more to them than the job would be to someone who is unemployed? Maybe, maybe not. Does it matter? If the job has to come first then this is trickle up, not trickle down. Would that be a better approach?
I think that the concept of efficient government is what is most important. Regulation as an aspect of that, and honestly, "entitlements" too. Or social services, or whatever we want to call it.
And, the reality is that we can both create jobs and maintain entitlements. I do not see that entitlements per se keep people from working -- as most working people qualify for entitlements. Yes, there are parts of the population utilizing entitlements who do not, but I don't think getting rid of the entitlements is the answer.
The whole picture really includes both, IMO. It includes making sure that there are jobs with livable wages -- so infrastructure, job stimulation, etc.
Even with this, and the majority of people working, there will still be people who don't, people who can't, and people who won't. And as far as I'm concerned, the can'ts and don'ts probably do need help, and perhaps we look at the people who won't and see what is what. Right? That's part of efficiency and overcoming corruption, etc.
But I'm trying to come up with something that isn't trickle down. I also believe that in that situation every level is going to siphon off what they can on the way down. It isn't something evil, its just human nature. What I'm suggesting is incentives that create jobs. There is nothing wrong with the actual incentive being assigned AFTER the jobs are created. Maybe even something so bold as (ONLY for example, not real numbers)... Give any employer a tax credit of $10,000 when they create a new position that keeps someone employed for the entire tax year. That way the corporations, the rich, the 1%, whoever is in charge has to put up something before they collect the benefit. Yes, whoever creates the position gets a benefit. Is that worth more to them than the job would be to someone who is unemployed? Maybe, maybe not. Does it matter? If the job has to come first then this is trickle up, not trickle down. Would that be a better approach?
It is a better approach! And one President Obama suggested! Remember? He called for tax credits for employers who hired a veteran, or someone who had been unemployed for a period of time. This is a good approach in that it helps nudge the employers to hire (certain people who classically are hard to employ) and it puts money into the hands of those who will in fact spend it, completing the circle. I don't have anything against capitalism, I'm all for it! I engage in it! But there has to be a balance and this is where we have gone wrong. I'm all for the rich getting richer, but I'm a rising tide type of person. Instead of rising with the tide, the middle class and poor are being swamped in the tide that seems to only be rising for the rich. The result is the rich are sitting on their money, not investing cause the middle and poor don't have the money to spend on their widgets. When you really examine stuff made and stuff sold, very little of it is necessary stuff, so the wealthy investors NEED a healthy middle class to buy their unnecessary stuff, including homes and cars and washing machines, all the big things we count on to keep the big machine going.
Here is a thing that would help everyone. Universal health care. It would help business, large and small, in that they would be relived of health care duties. Small businesses would be able to hire more without this overwhelming burden. Individuals wouldn't fear starting their own small business, especially those who have kids, or have themselves pre-existing conditions. Families would be relived of the fear of being one health care issue away from bankruptcy. It's a win win for everyone! OH, and it works, by the way. Don't forget, I lived under government run health care for 30 years, and it works. Efficiently and completely.
I think we agree on a lot Gregg. Our economy is broken, but it is well worth fixing. We don't need to throw it all out, as Ron Paul advocates, but we do need to toss out some of these a--clowns in congress. New rule: Anyone who runs on "I will never compromise or work with the other side" needs to be out on their stubborn, divisive butts! That goes for both sides of the isle!
New rule: Anyone who runs on "I will never compromise or work with the other side" needs to be out on their stubborn, divisive butts! That goes for both sides of the isle!
I agree peggy. That is, or should be, unacceptable behavior especially when we are facing the challenges we are right now.
And yes, I do remember the President's plan to support the hiring of vets and I did (and still do) like that idea. Let's take that and run with it and expand it to include anyone who has been drawing unemployment. You're right, the economy is broken. I don't think there is any way to fix it unless we can get the unemployment rate back down to that 5% range. To do that our leaders need to pull out all the stops to produce an environment in which job creation makes sense.
I like your "trickle up" approach, Gregg. We both know that many corporations are sitting on enormous piles of cash reserves right now, but not spending it on hiring until the economy improves. And the economy isn't improving because they're not hiring (and imho because the top echelons of society are hoarding and hiding, but that's another conversation) I think your ideas might be the sort of thing that breaks this stalemate. Already large companies are enjoying big tax breaks, benefits to moving offshore, and ultra-low lending rates -- none of which are apparently enough to get the economy moving again.
We've tried supply-side and the supply side isn't budging. The demand side is terrified and not spending. Maybe some radical moves like the ones you suggest might get the big machines cranking again.
ApatheticNoMore
2-16-12, 11:08am
So maybe what 10% of the population has been officially unemployed, maybe if you add those who aren't counted it is 20-25% who want jobs. Then there's all the people who aren't working and don't even want jobs (retired, students, housewives whatever). And yet society functions 100% just fine as is (except for for those people). There is no real organic need for all those people to be working. Oh if only we would demand more more more ... I know where is our greed? But like I say no real need.
iris lily
2-16-12, 11:13am
...and imho because the top echelons of society are hoarding and hiding, ...
emphasis mine.
wow. Your loaded terms speak clearly that you think that others are entitled to their money, and probably regardless of the means.
Yes, I look askance at the tiny veneer of society that has the luxury of hiding their money in offshore accounts so it can't be taxed, then b*tching and whining because they're taxed too much. No secret there. My point is that many (not all) of these "job creators" aren't. They're banking all of the incentives being offered by the government -- incentives my tax dollars are paying for, by the way -- and use their influence to hold any substantive economic change hostage in Congress.
Emphasis mine.
Though of course that's just my opinion. One not likely to change any time soon.
And that said, I know an awful lot of people in my community and in my circle of friends who use their wealth to build community, create jobs, raise amazing children, and better the world. I reserve my respect for them.
I like Gregg's ideas of getting things in motion through incentives, but attaching something substantive to the incentives so they are less likely to be used to fund obscene bonuses and a new McMansion on a private island somewhere.
I like Gregg's ideas of getting things in motion through incentives, but attaching something substantive to the incentives so they are less likely to be used to fund obscene bonuses and a new McMansion on a private island somewhere.
Perhaps the government could establish maximum compensation amounts for it's citizens and publish approved purchases that private citizens could make with the money each is allotted. Of course, I'm not sure how the concept of progressiveness would come into play. We've established that progressive taxation is okay, I wonder if progressive compensation would be equally okay under such a scheme?
There are undoubtedly some individuals who hoard money. That mentality exists when it comes to all kinds of things and money is not exempt. As long as those people made it by legal means they can do whatever they want with it and the rest of us don't have the right to say boo. Corporations are a little different matter. It's not that it would be illegal for corporations to hoard money (its not), its just that it doesn't make any sense for them to do it. Corporations, in the modern, financial definition, exist as a means to invest capital into a venture that in return generates more capital. If that entity simply sits on a pile of money the production of capital starts to decrease relative to the potential and/or expected returns. Basically it slowly strangles itself because of inflation and stagnant growth.
One problem we have right now is obviously the uncertainty of our economy. This is one of those unusual times when the prudent thing to do with money might be to just sit on it. I can't blame CFO's and fund managers for taking a wait and see approach in the short term. They know what the risks are if they bet wrong so are trying to eliminate the risks by not betting at all. As long are they are waiting to be reactive to policy it makes sense for policy to go ahead and be proactive.
In terms of job creation the idea of tax credits for jobs that were created and remained after a year still makes sense to me. That's a no lose deal because by the time the credit is issued the benefit to the government has already been realized. I also like the idea of eliminating tax credits and subsidies to companies who move off shore. If they decide it makes economic sense to do so they have that right and should still be allowed to sell their goods here, but I would rather not subsidize the sale. That could also be a valuable line item as corporations weigh the costs and benefits of moving overseas vs. staying in the US. I'm not saying we should be coercive getting them to stay, but its silly to make it beneficial for them to go.
Gregg, are any of the candidates seriously entertaining a plan like the one you mention here? I feel it would significantly level the playing field, and it would be interesting to know. I may look at some of them in a different light.
I understand why the game is at a standstill. I certainly don't exempt myself from the wait-and-see, having postponed certain hiring decisions until I feel the future's a little less murky. But I'm trying to take risks where it will provide the most benefit. I'm hiring a programmer this morning who's been out of work for some time -- she's brilliant and will make a great addition. She is also aware that it may not be forever, and she gets it; in the meantime she's learning valuable skills that will help her in future job searches.
As far as hoarding, people are free to do with their wealth whatever they'd like, and to use it for endless acquisition rather than contributing their time, energy, and resources to building a thriving, healthy society. Not my problem. You can't make someone give a damn. Others are also free to "work" government entitlement programs if they wish, again to avoid being part of a thriving, healthy society where everyone works hard to contribute to the good of all. Again - not my battle, as you can't force someone to feel what they simply don't feel. But I reserve the right to have the same contempt for free riders at the top as I do for free riders at the bottom.
Just me. Not policy decisions.
New rule: Anyone who runs on "I will never compromise or work with the other side" needs to be out on their stubborn, divisive butts! That goes for both sides of the isle!
That "I will never compromise" thing is just smoke and mirrors. NDAA? No problem. Agreeing on extending payroll tax cuts through the election without finding cuts to cover it all? No problem. They work with other side and compromise just fine when they want to.
Gregg, are any of the candidates seriously entertaining a plan like the one you mention here? I feel it would significantly level the playing field, and it would be interesting to know. I may look at some of them in a different light.
Overall Ron Paul is probably the closest, but as we've discussed several times he's probably not electable. I think everyone of the candidates (including the Democratic candidate) has some viable ideas. Everybody has an opinion about how to prioritize in order to fix the economy. As usual the trick is picking the candidate who's view is closest to your own. And, of course, never stop communicating with your elected officials. At any level the more an idea is heard the more likely it is to get serious consideration.
flowerseverywhere
2-16-12, 2:01pm
I am amazed at how civil this discussion has remained with lots of good ideas put forth.
When you talk about trying to pay as little as possible in income tax, I know that I for one try to take advantage of everything I can, but of course we don't have the means for things like tax shelters. I pay my fair share of course, being in the middle class and it really bugs me that so many people (what is it, 49%) pay no federal tax at all. I want to preserve as much as I can for my children as they will not have the same advantages this generation had of benefiting from years of roaring stock markets, pensions and social security as we knew. I don't think that is selfish, but as I said we are very middle class and pay income tax every year to state, local and federal governments. Plus sales tax and gas tax. And we were fortunate enough to never qualify for any goverment assistance such as unemployment insurance, food stamps or free lunches for kids. We do benefit from our fire protection, our wonderful state and national parks, snow removal etc. though.
Pub, you are so right, it is the free riders at both the top and bottom that bug me.
I want to preserve as much as I can for my children as they will not have the same advantages this generation had of benefiting from years of roaring stock markets, pensions and social security as we knew.
Word. I'm 35 and I feel the difference between our world and our parent's world. And I see the difference between our parents and our grandparents world.
My grandparents and my husband's grandparents all had multiple homes in their lives. first home became a rental property; second home became the family home when the kids were 10 or so; third home was a vacation home. my parents first home was sold to buy the second when a larger mortgage could be obtained, and no vacation home was purchased. many of my friends do not own their own homes -- as they didn't want big mortgages higher than what they could pay. Those who do own their own homes are now, largely, in upside down mortgages.
It's not absolute, of course. A lot of people my age do "own their own homes" or have mortgages at least, and I have a couple of friends who followed the grandparent's route, and a couple of friends who have two homes (one vacation home). I have several VERY wealthy friends (Sitting between $12M and $25M -- some of them my mentors).
My mentors inform me that they all started out just as we are now, and like us -- entering into this third year -- is the critical point where we are shifting from sustainability to recovery to wealth. Recovery refers to getting the return on our financial and sweat-equity investment, which is an actual dollar amount. That recovery should be underway in 7 weeks (things going as they are now, with some conservative projecting), and considering the dollar amount and conservative projection, we are talking about 2 years to get recovery.
After that, it's all wealth building. So, we shall see.
flowerseverywhere
2-16-12, 8:14pm
Word. I'm 35 and I feel the difference between our world and our parent's world. And I see the difference between our parents and our grandparents world.
My grandparents and my husband's grandparents all had multiple homes in their lives. first home became a rental property; second home became the family home when the kids were 10 or so; third home was a vacation home. my parents first home was sold to buy the second when a larger mortgage could be obtained, and no vacation home was purchased. many of my friends do not own their own homes -- as they didn't want big mortgages higher than what they could pay. Those who do own their own homes are now, largely, in upside down mortgages.
It's not absolute, of course. A lot of people my age do "own their own homes" or have mortgages at least, and I have a couple of friends who followed the grandparent's route, and a couple of friends who have two homes (one vacation home). I have several VERY wealthy friends (Sitting between $12M and $25M -- some of them my mentors).
.
Grandparents were immigrants who grew up in tenements. None had houses ever.
I grew up in a two bedroom house, DH in a three, and we both had multiple siblings. At one point when we were all home I shared a room with two brothers and a sister, with the baby with my parents.
I own one house, and two of my sibs are upside down in their middle class houses, one lives in a trailer and the other sibs are near the end of mortgages. We obviously had nowhere near the wealth your family did. Even when my kids were growing up we would load the clunker to go tent camping, or take day trips. I am talking about a much lower level of wealth that I doubt many young hard working well educated people I know will have in their 50's.
My kids say they had a very happy childhood, though, and have lots of fond memories. They are good kids and all of us have lived honest lives with good life partners so I consider us so much luckier than most. It is a heck of a lot easier to feel happy if you have enough food, a roof over your head and a secure life. And someone to love you.
ApatheticNoMore
2-16-12, 8:32pm
Many of the people I know my age (also mid 30s) who have a home bought in less desirable neighborhoods to be able to afford it, though some didn't. Those who didn't stress about their mortgages. Many don't have homes, neither do I. I don't know any rich people in person, I mean I really don't. I guess you could say the CEO at a company I worked for. But that was knowing only in the most distant sense. I know solidly middle class people, and I know some people who are living hand to mouth, but even those people aren't from poverty. They just tend to make life choices other than income really. Everyone I know is ever always middle class when you scratch them. :) But yea some people struggle now, obviously.
Yes, my great grandparents were a combination of immigrants, or the great-great grandparents were. My great grandparents were farmers -- most owned very large farms or ranches (in CA or MN).
My grandparents were both blue-collar workers; so were my husband's grandparents.
My parents were white-collar workers.
We would be considered white collar, we are now entrepreneurs.
our wealthiest friends (worth between $12M and $25M depending upon the person) are entrepreneurs, with the exception of one who worked in the stock market and understands that market well. He lives in a very simple apartment in NYC and no longer "works" -- he is a consultant and plays the stock market with his money. But the rest own their own businesses.
Several of those businesses provide niche products to niche markets, hire very few employees (under 10 -- which includes sales people, administration, accounting, etc; one company has only 2 employees -- 1 secretary/admin, 1 sales representative), and pay for product manufacture in the US.
Trust me, I'm not complaining that I'm poor or whatever, but the very real situation is that many of us were raised middle class or upper middle class, but do not live in a world where we will be able to create that for ourselves -- plain and simple. Or, at least, so long as we continue with "work-a-day" living.
There are lots of reasons for this.
I think I"m also bitter because. . . and this is a big one. . . my ILs and sometimes my parents are very critical of every spending habit (i.e., $350 on food), even though they have no sense of the market in this situation.
flowerseverywhere
2-17-12, 6:05am
Apathetic, I'm with you. I don't know any money rich people but I am very lucky to have many friends and acquaintances who are self sufficient and truly rich in their hearts and souls.
Getting back to the original discussion I guess that you can criticize the safety net but an awful lot of this is what you expect and what you are happy with. When the state of the union address was given and the Prez started talking about private colleges that don't keep costs down I wanted to stand up and scream "STOP ITERFERING" I mean what is wrong with living at home, working and taking community college classes or going to a state University for the large majority of people? Maybe what a lot of us need is an attitude adjustment away from the gods of consumption and accumulation of piles of stuff.
There are a whole bunch of us middle class taxpayers who aren't unhappy and don't feel cheated or deprived or feel we need to get a bigger piece of the pie. I see them post every day here and see them every day in all walks of life.
I do feel terribly bad for young people who have worked hard and done all the right things yet cannot get good paying employment and are not given the opportunity I was to make a good living wage.
also, I don't think it is a contest to say who grew up poorer or richer, who has accumulated more or who has the best ideas and goals. but rather I consider these forums as a place to share, throw out different ideas and learn from others who obviously have different backgrounds, educations, values and goals than you do. The world is a big place and we are all different which is a good thing or it would be mighty boring.
Also, I don't think it is a contest to say who grew up poorer or richer, who has accumulated more or who has the best ideas and goals. but rather I consider these forums as a place to share, throw out different ideas and learn from others who obviously have different backgrounds, educations, values and goals than you do. The world is a big place and we are all different which is a good thing or it would be mighty boring.
At its best I think that is what we are all hoping these forums will be. Overall I haven't run across many places that do it better.
Several of those businesses provide niche products to niche markets, hire very few employees (under 10 -- which includes sales people, administration, accounting, etc; one company has only 2 employees -- 1 secretary/admin, 1 sales representative), and pay for product manufacture in the US.
Trust me, I'm not complaining that I'm poor or whatever, but the very real situation is that many of us were raised middle class or upper middle class, but do not live in a world where we will be able to create that for ourselves -- plain and simple. Or, at least, so long as we continue with "work-a-day" living.
There are lots of reasons for this.
I'm not sure how to put this Zoebird except to say that I probably could not disagree more strongly. In the spirit of flowerseverywhere's post above I want to make sure you know I'm not dissing your opinion in any way, but my own experience is 180*, polar opposite from what you described.
I AM one of those people who provide niche products to niche markets. A very high percentage of people I regularly associate with do the same thing. My background, economically, is lower middle class. We were farmers who survived season to season (paycheck to paycheck, hand to mouth, etc.). One drought, one hail storm, one year of depressed cattle prices and we would have been toast.
I can not think of a single entrepreneur friend of mine that came from any kind of privileged background. I'm not sure any except one who's father was a doctor were even upper middle class. Most all of them came from backgrounds like mine. Not to say it wouldn't have advantages, but I think coming from money would dull a certain hunger that entrepreneurs ALL share.
The truth is entrepreneurial ventures are rarely rocket science. The reason most people don't start something of their own is not lack of IQ and it is not because there is ANYTHING outside their own head holding them back. To be blunt, fear of failure is what holds people back. What would we do if this doesn't work? Could I get my old job back? You want to leverage the HOUSE??? How would we survive? And about a hundred other perfectly sane and viable questions without clear cut answers all add up to most people being paralyzed and never taking the jump. It just annoys me when people blame external forces because that is almost never what's stopping them.
About the only thing entrepreneurs do differently is to realize that nothing will happen if they don't try. They have the same fear, they just manage to overcome it. That, and they don't quit. If you don't have what it takes to stick with your idea until the bloody end (if it comes to that), you won't make it. Wayne Dyer said, "There is no scarcity of opportunity to make a living at what you love; there's only scarcity of resolve to make it happen." He's right.
What is the difference between an economic incentive and an entitlement? And when they are sitting together in a cash register how does one tell them apart?
Incentive: Join the armed forces and give them 6 years and they will pay for your college education.
Entitlement: Come to this country illegally, just exist and do nothing but get a free taxpayer paid education thru grade 12, and they will pay for your college education (the "Dream Act").
The "cash register" of the college gets filled either way - and both with taxpayer dollars - but what a difference between the way each is filled. Maybe doing volunteer activities or some sort of work to earn benefits and entitlements would be a way to go. Even a part time minimum wage job could be supplimented with UI, food stamps, etc... rather than allowing those qwho are able to just sit back and collect. I'm a big fan of entitlements for the needy, but feel that it can be re-worked in a way that creates incentives as a way to recieve those entitlements.
ApatheticNoMore
2-17-12, 2:18pm
When the state of the union address was given and the Prez started talking about private colleges that don't keep costs down I wanted to stand up and scream "STOP ITERFERING"
basically this problem was caused by the government. These private colleges (and he's not referring to Harvard here, but more University of Phoenix) would be nothing without student loans. This is what a vacational school told me for what it is worth: some vocational schools ACTUALLY raise prices because they need a certain percentage of the population to be on student loans in order to qualify for student loans at all. So say for example education costing 3k a year, many people could swing it without student loans, but 10k a year not so much so. And they actually price in order so more people can be on student loans. That may be an aside, the point is all those for profit universities would not exist (not at current cost structures anyway!) without student loans.
I mean what is wrong with living at home, working and taking community college classes or going to a state University for the large majority of people? Maybe what a lot of us need is an attitude adjustment away from the gods of consumption and accumulation of piles of stuff.
Yes, but they (preferably the states) do need to keep adequate funding for the state universites and community colleges for this. The situation here is bad, college courses being cut all over the place.
I'm a big fan of entitlements for the needy, but feel that it can be re-worked in a way that creates incentives as a way to recieve those entitlements.
+1
eta "AND helps the country in some way in the process."
it really bugs me that so many people (what is it, 49%) pay no federal tax at all. it is the free riders at both the top and bottom that bug me.
Not all people who pay no taxes are low income. Many people, myself included, are in the zero % tax bracket yet have middle class incomes or large financial assets. Many of those people are using income that has already beeen taxed (Roth IRA's for example) or have non-taxable incomes such as the first $25K of Social Security, certain pensions, etc.... So should these people pay more income tax even if they aren't required too by law? Should those early retirees, like me, who can live on a small income and pay less in taxes go back to work for the sole purpose of paying more taxes? Not that we would :-) but it's something that I deal with often and feel a bit (but just a bit) bad about. My (very small) Military/VA disability pension is tax free but it's not an entitlement based on income or assets - just a "payment" for a loss I incurred while in the service that I would get even if I were a billionaire. So it's not that we are freeloaders mooching off the system, it's just that we choose to live on less (and shelter the financial asstes in tax deferred things) and don't have the need for a higher income. Many of the 49% of "zero- tax" payers are in this self-supporting catagory - not the mooching freeloader catagory :-)!
ApatheticNoMore
2-17-12, 2:48pm
I'm impressed by someone who manages to do this purely using a Roth. The maximum contributions are 5k a year. 20 years to save 100k. But your money earns money. Uh no not really it doesn't, not since I've been investing. Pensions, yea a lot of people seem to retire on them, tell me where could I get one of those?
I'm impressed by someone who manages to do this purely using a Roth. The maximum contributions are 5k a year. 20 years to save 100k. But your money earns money. Uh no not really it doesn't, not since I've been investing. Pensions, yea a lot of people seem to retire on them, tell me where could I get one of those?
I've been seeing articles pushing annuities as the "new pension". The only difference being you pay for it instead of your employer :-(
I'm impressed by someone who manages to do this purely using a Roth. The maximum contributions are 5k a year. 20 years to save 100k. But your money earns money. Uh no not really it doesn't, not since I've been investing. Pensions, yea a lot of people seem to retire on them, tell me where could I get one of those?
Well I'm assuming that many people in the zero % or lower % tax brackets get a combination of Soc. Sec., Roths (or some other tax deferred thing) and choose to live on an amount that is under the tax radar. I am too young to withdraw IRAs - and only have Trad IRAs anyways - but when I do, I will calculate the amount I can withdraw each year that doesn't put me in a higher tax rate (although I'll most likely be in the 10% then). I do the same with my 457 (tax deferred), pension (only partially taxed as some comes from already taxed amounts), saving bonds, etc... If you only need a small amount to live on, then you can keep your tax level low. Of course "small amount" differs for everyone. For one person getting a tax free $12 - $24K/ year from Soc Sec might be more than enough to live on, for another they may need to suppliment with money from somewhere else - say a Roth or Trad IRA. With a paid for house and no debt I needed less than $1K/month to live comfortably on (but have a higher income). Would not pay much in taxes on that after taking my standard deduction and personal exemptions.
I can not think of a single entrepreneur friend of mine that came from any kind of privileged background. I'm not sure any except one who's father was a doctor were even upper middle class. Most all of them came from backgrounds like mine. Not to say it wouldn't have advantages, but I think coming from money would dull a certain hunger that entrepreneurs ALL share.
To be honest, this is muddled into the point. :D
While I come from middle/upper middle class, my father came from poverty (for much of his life) and worked his way through his education and up a corporate ladder to provide a middle/upper middle class lifestyle for himself and us. He's doing ok. He had the hunger. So, I am privileged.
But if I were to attempt to follow the same path as my dad (as many of my friends do/have), guess what? Not getting as far as dad by the same ages. Frustrating.
So, I looked out and said to self "What seems to be working to create this?" Every entrepreneur who is successful is 1. hungry, and 2. outside the system. They are taking a big risk -- and so long as they work it smart and keep working it -- they succeed on their own merits.
Most of the people whom I know who are my parents age and entrepreneurs at this level ($12-25M) started around my age (around age 30), giving up a corporate life, and come from middle class (or lower) families.
Here is what I saw in the evaluation of my life:
1. DH was working in work he thought was ok. Not great. Got decent pay. Only way to earn more was to work into management. DH hates managing -- so not a viable pathway for him after a certain point. That means an income ceiling and begging for raises or getting COL raises as the company decides he should.
2. I was working in a "tech" way. One adviser of mine says that you have "businesses" and "independent jobs." Businesses create passive income for owners, and owners aren't doing the "stumping" of all of the work. Independent jobs are where you are your own boss, but you do all of the work (teaching yoga classes). Means to earn more, you have to work more!
As I was tapping out, and DH wasn't getting any higher in his career due to his own work-ways, we suddenly realized that we were at our cap. We could not expect to earn more money without taking on more work (which means the life side of things suffer). And, that cap wasn't high, and it wasn't keeping up with inflation.
The things that we wanted and dreamed for ourselves would not be possible -- sending our son to schools of our choices; having the home of our dreams (which isn't' a big fancy dream, btw); being able to travel; being able to eat the foods that we want (we do this, but we do forgo things that we would like/prefer because of budgetary concerns). Etc.
So, we decided to take the risk. We were hungry. we want what we want -- and they aren't big wants. But at about $73k per year, and only going up 1-2% in raises per year with the health insurance increasing by at least that much each year if not more, then what? We were saving, we were able to pay for our simple condo, our car, our student loans, our food, and some basics -- but no way we could afford the added $10k per year for DS's education, and could only do the travel that we like every 4th or 5th year (and with DS, probably less often).
And that is what brought us to where we are. I designed a business where I think we could earn that kind of income over time. I still do "independent job" type of work as well, but I'm in the process of developing it more into the "business" side of things (and about 1/3 of the way to that goal), and from there, into a franchise. That's where the income really keeps moving, so that even if I opt to no longer do the "job" side of things (teaching yoga classes, though I know that i will be teaching them for a long time), the business will keep right on going/growing.
I enjoy it, too. Which is nice. :D
The truth is entrepreneurial ventures are rarely rocket science. The reason most people don't start something of their own is not lack of IQ and it is not because there is ANYTHING outside their own head holding them back. To be blunt, fear of failure is what holds people back. What would we do if this doesn't work? Could I get my old job back? You want to leverage the HOUSE??? How would we survive? And about a hundred other perfectly sane and viable questions without clear cut answers all add up to most people being paralyzed and never taking the jump. It just annoys me when people blame external forces because that is almost never what's stopping them.
I agree. I also think that there's nothing wrong with opting to not take the risk.
About the only thing entrepreneurs do differently is to realize that nothing will happen if they don't try. They have the same fear, they just manage to overcome it. That, and they don't quit. If you don't have what it takes to stick with your idea until the bloody end (if it comes to that), you won't make it. Wayne Dyer said, "There is no scarcity of opportunity to make a living at what you love; there's only scarcity of resolve to make it happen." He's right.
Exactly. And, i personally think that it's the level of risk that often leads to the level of reward.
I know a lot of people who run small family businesses that are rewarding for them, but don't actually create the wealth that they may want or hope for.
In this article, the man created a business that essentially requires him and earns very little. And that is an honorable thing. It's what mechanics do, and honestly, a lot of yoga teachers who own their own studios and are pretty much the only teachers at their studios (where I am right now, pretty much!). I admit that -- to an extent in my business right now -- I'm falling back on my security blanket. I know I can grow a yoga studio, so I'm growing it.
Now, I'm starting to stretch back out into the business and try to get the business side of things going, so that I can work less (as in, teach fewer classes), and transition the business back over from 'job' to 'business.' KWIM? Anyway, that might be vague.
The reality is that there's nothing else that we can do. We have to keep going and keep working hard. It's why we made this decision. We knew that doing something else was going to continue us in the path of not getting what we want for ourselves (and our son).
Spartana,
I agree. It's partly why I like the DK system so much. Everyone works for their education. Ok. kids and such as educated. But once you are in high school and university, you work. You do all manner of civil service jobs. And, you get a LOT of entitlements from it too -- stipends, living expenses, etc. it's great.
I think it's a great system all around to have people working. And heck, we need the civil service corps again, truly. I would love to see the national parks cared for by troops of young people who are working their way through university and high school. It would do everyone so much good. Kids who have never seen such wonders in nature because of their backgrounds in inner cities, for example, would suddenly know what the great romantic and transcendentalist writers were on about!
flowerseverywhere
2-17-12, 9:16pm
Not all people who pay no taxes are low income. Many people, myself included, are in the zero % tax bracket yet have middle class incomes or large financial assets. Many of those people are using income that has already beeen taxed (Roth IRA's for example) or have non-taxable incomes such as the first $25K of Social Security, certain pensions, etc.... So should these people pay more income tax even if they aren't required too by law? Should those early retirees, like me, who can live on a small income and pay less in taxes go back to work for the sole purpose of paying more taxes? Not that we would :-) but it's something that I deal with often and feel a bit (but just a bit) bad about. My (very small) Military/VA disability pension is tax free but it's not an entitlement based on income or assets - just a "payment" for a loss I incurred while in the service that I would get even if I were a billionaire. So it's not that we are freeloaders mooching off the system, it's just that we choose to live on less (and shelter the financial asstes in tax deferred things) and don't have the need for a higher income. Many of the 49% of no taxpayers are in this self-supporting catagory - not the mooching freeloader catagory :-)!
My wording was not very nice, and I apologize for that because there are probably many people like you, but I guess what I can't understand is how the system can continue in this fashion. We all want schools that have all the latest books, well paid teachers, to be able to safely get around on well maintained bridges and roads free of snow. I want our soldiers, firefighters, police and others in public service to be well paid. When a soldier is wounded I want him or her to come back and be well cared for with the latest technology in an up to date hospital. I don't want children to starve or old people to freeze to death but every single service that is given by some layer from local government on up has to be paid for. The government doesn't pay for all this, the taxpayers do. No one wants to pay higher property taxes, higher school taxes or higher federal taxes of course but we are on a course where we are spending way more than we take in as a country and long term that will lead to collapse or placing an ever greater burden on future generations. What is the solution to this? I get tired of hearing "cut waste" or "downsize government" without specific examples as what people really want to cut in my opinion are services that others use, not them.
you know, here in NY a law was recently past restricting how much property taxes can increase in a year. All well and good, but what about all the pensions that were promised to teachers and police? How can they continue to collect on their ever increasing health care and pensions when taxes are limited and kids still need to be educated and police forces staffed? the NY unions are pointing at California as an example saying the property tax laws there have placed an enormous burdens on the schools and the diminishing quality of education.
iris lily
2-17-12, 11:30pm
How can they continue to collect on their ever increasing health care and pensions when taxes are limited and kids still need to be educated and police forces staffed?
They can't. And we all know that.
flowerseverywhere
2-18-12, 7:19am
wanted to add when you read things like the following statement it paints a picture that leads people like me to have the picture of "mooching freeloader"
"Also, welfare beneficiaries will be banned from accessing public assistance funds at ATMs in strip clubs, liquor stores, and casinos."
from: http://www.cnn.com/2012/02/17/election/2012/payroll-tax-deal/index.html?hpt=hp_t3
Why were they ever able to? While this may be a small fraction any fraction is too much in my opinion. Of course people can still go to an ATM down the street but obviously if this was put into the wording it has to be somewhat of a problem.
wanted to add when you read things like the following statement it paints a picture that leads people like me to have the picture of "mooching freeloader"
"Also, welfare beneficiaries will be banned from accessing public assistance funds at ATMs in strip clubs, liquor stores, and casinos."
from: http://www.cnn.com/2012/02/17/election/2012/payroll-tax-deal/index.html?hpt=hp_t3
Why were they ever able to? While this may be a small fraction any fraction is too much in my opinion. Of course people can still go to an ATM down the street but obviously if this was put into the wording it has to be somewhat of a problem.
I suspect that's the point--like the recent law passed somewhere in the SE requiring drug tests of people seeking unemployment payouts. Of course, only a tiny minority (I think it was 2%) had traces of some naughty substance in their sample, but it had the effect of painting all the unemployed as drooling druggies. Ditto with the law cited above. Clever psychological warfare on the needy, redirecting what might otherwise be our rage at the powerful interests at the top of the heap toward "the least among us."
ApatheticNoMore
2-18-12, 12:34pm
What about if the liquor store is the only neighborhood grocery? Isn't that what the whole food deserts concept is about? Lack of available healthy food. I mean it is unfortunate if that is the case but ... even liquor stores don't just sell liquor, they usually sell some other things: fruit juice, milk, etc.. even though vice is thier stock and trade. For the strip clubs and casinos I have no real defense :) (but it is possible all these businesses are difficult to seperate from an information technology perspective)
I suspect that's the point--like the recent law passed somewhere in the SE requiring drug tests of people seeking unemployment payouts. Of course, only a tiny minority (I think it was 2%) had traces of some naughty substance in their sample, but it had the effect of painting all the unemployed as drooling druggies.
More than that it's degrading and probably doesn't really save money. Ok on accessing public assistence funds at casinos, all that is done is making it so the card does not work at certain kinds of businesses. It's not terribly invasive. But drug tests on the other hand are. But people taking money have no right to privacy .. well maybe not complete privacy, I mean they do need to report their income and so on, but to be free from drug tests, yes I think they probably should. Besides by normalizing drug tests it only makes it so pretty soon we're all pissing in cups. And if only 2% of the population is druggies, the cost to ADMINISTER the drug tests might be more than they save or at any rate close to it. And no government is not a business and you can't EVEN assume all it's decisions even make sense on a return on investment basis :~) (nor can you at very bureaucratic businesses but anyway). By the way I do know druggies that abuse the foodstamp system and so on :\ But hey even if a boatload of druggies abuse the system, that doesn't mean most people using the system are on drugs.
But larger point more intention is paid to a few people abusing the welfare system than really makes sense from a cost basis IMO. I really don't even think it's about costs at a certain point. I mean if you want to set your sights to complain about and oppose Medicare and Social Security well ok ..... at least those programs have a decent effect on the budget, so you are at least talking real money. But do programs exclusively for the needy really? How much do these really cost compared to something as worthless as say the TSA?
In this article, the man created a business that essentially requires him and earns very little. And that is an honorable thing. It's what mechanics do, and honestly, a lot of yoga teachers who own their own studios and are pretty much the only teachers at their studios (where I am right now, pretty much!). I admit that -- to an extent in my business right now -- I'm falling back on my security blanket. I know I can grow a yoga studio, so I'm growing it....
...The reality is that there's nothing else that we can do. We have to keep going and keep working hard. It's why we made this decision. We knew that doing something else was going to continue us in the path of not getting what we want for ourselves (and our son).
Zoebird, there are as many reasons to start a business as there are businesses. From what you've said I am lead to the assumption that you started a yoga studio because you love yoga and are probably really good at it. That is wonderful and at every bit as valid a reason to start a business as any other. We actually have a few friends who own yoga studios, day spas and other businesses with similar clientele. A few of them are very happy, a few are struggling. The ones who are happy all seem to have other financial resources (a spouse with a high income, family money, investments made during a previous career). The ones who are struggling rely on their business for income.
One very good friend has enough business to keep running in the black, but not by much. She has a combination of yoga, massage, tai chi, acupuncture (contracted with a provider), some retail product sales, etc. The only way that she stays afloat is if she is the one teaching classes, doing laundry, doing basic bookkeeping, cleaning the studio, ordering product, scheduling appointments, sticking copied posters in all the local coffee shops... What she has discovered is that there is simply not a large pool of customers out there who want to suddenly start buying her product just because she is now selling it. Most of the people who like it already have a place to go. Getting them to switch to her studio is almost impossible. Its just like a grocery store. The old rule of thumb was that if a grocery store could get you to come to them three times that would become your regular store no matter what the competition did to lure you away. Beyond that a group of people with a latent demand to start yoga classes simply does not exist. Her growth is capped out because the demand for her product is capped out and she does not have the marketing resources that it would take to create demand. For the most part she loves what she does, its just a poor business model when it comes to providing the incomes she had hoped for.
Entrepreneurs who get wealthy marketing to niches start their business specifically to fill those niches, loving or hating the particular target industry rarely has anything to do with it. They most likely discovered the niche first then designed the company to fill it. If you ask them what they actually love the answer will probably have something to do with FINDING the niche and figuring out how to fill it. Not to be overly dramatic, but its the hunt and the start-up, not owning a business. Its not uncommon for those people to get really bored once the business is established because the part they love is over. That is about the same point where a lot of small business owners start to get comfortable because its when they finally get to start doing what they love.
People think entrepreneurs and small business owners are the same thing. Sometimes they are, but usually the approach to what they do is quite different. Entrepreneurs often try to find a niche and figure out how to start a business that fills it. Small business owners often want to start a business and hope there is a niche they can fill with it. It's not a matter of deciding which is better, its a matter of deciding which mentality you really have and thus which is better for YOU.
My wording was not very nice, and I apologize for that because there are probably many people like you, but I guess what I can't understand is how the system can continue in this fashion. We all want schools that have all the latest books, well paid teachers, to be able to safely get around on well maintained bridges and roads free of snow. I want our soldiers, firefighters, police and others in public service to be well paid. When a soldier is wounded I want him or her to come back and be well cared for with the latest technology in an up to date hospital. I don't want children to starve or old people to freeze to death but every single service that is given by some layer from local government on up has to be paid for. The government doesn't pay for all this, the taxpayers do. No one wants to pay higher property taxes, higher school taxes or higher federal taxes of course but we are on a course where we are spending way more than we take in as a country and long term that will lead to collapse or placing an ever greater burden on future generations. What is the solution to this? I get tired of hearing "cut waste" or "downsize government" without specific examples as what people really want to cut in my opinion are services that others use, not them.
you know, here in NY a law was recently past restricting how much property taxes can increase in a year. All well and good, but what about all the pensions that were promised to teachers and police? How can they continue to collect on their ever increasing health care and pensions when taxes are limited and kids still need to be educated and police forces staffed? the NY unions are pointing at California as an example saying the property tax laws there have placed an enormous burdens on the schools and the diminishing quality of education.
No need to apologize, I agree with you completely. There is a definite "Catch-22" thing going on when it comes to taxing people like me. I would have no problems paying more in taxes myself to help fund many public programs (especially universal healthcare for all). But... the tax system we have allows me - and other simple living frugal cheapskates like me - to pay very little in taxes yet still reap many of the public benefits such as police, fire, roads, etc... Not sure what the solution to that is, as I can't see a fair way to tax "self-supporting-lower-income-by-choice" folks without placing the same tax burden on those who are truelly needy. I guess that since much of my financial assets were previously taxed (all the money I earned for the most part that didn't go into tax deferred things) and I didn't have kids so had fewer write-offs and didn't use the education system for them (although I paid into it)I may have contributed more towards the tax system, and used less public services, over the years than say a person with numerous kids. Yes, I know I'm justifing my tax-less-now life but a girls gotta do what a girls gotta do to sleep at night :-)!
And of course a big part of the problem is that many people don't like what the tax money goes towards. Or who it goes too. Too many working and middle class people - many home owners, who pay the bulk of the taxes to support the system, have to lose everything they have before they can qualify for any social aid. Not right IMHO. It's hard to see the advantage in being the major financial support for a system but never be able to use it unless you are destitute.
Spartana,
I agree. It's partly why I like the DK system so much. Everyone works for their education. Ok. kids and such as educated. But once you are in high school and university, you work. You do all manner of civil service jobs. And, you get a LOT of entitlements from it too -- stipends, living expenses, etc. it's great.
I think it's a great system all around to have people working. And heck, we need the civil service corps again, truly. I would love to see the national parks cared for by troops of young people who are working their way through university and high school. It would do everyone so much good. Kids who have never seen such wonders in nature because of their backgrounds in inner cities, for example, would suddenly know what the great romantic and transcendentalist writers were on about!
I think the key thing in Denmark and other countries with a similair social system is that the entitlements (and obligations - both financial (tax) and social (service)) are for EVERYONE. Whether it's education, healthcare, or old age care, everyone is covered. The problem with the USA is that it's apick and choose kind of deal. The Dream Act will help finance college for illegal immigrants yet poor impoverished Bubba Gump down in rural Mississippi has no way to attend college except to go into the military. It's not equal and it's not fair IMHO.
flowerseverywhere
2-18-12, 2:01pm
[QUOTE=ApatheticNoMore;67954]What about if the liquor store is the only neighborhood grocery? Isn't that what the whole food deserts concept is about?
QUOTE]
In my state and many others I have visited and lived in Liquor stores sell only liquor. No food, no juice, no beer, no cigarettes, they are very regulated and sell liquor only during strictly regulated hours.
ApatheticNoMore
2-18-12, 3:21pm
Hmm ok, well it doesn't seem to be like that here (yes I've been inside liquor stores and sometimes not to buy liquor - look if stuff is in walking distance you take advandage of it and I wasn't even in a food desert). I don't actually think we have much in the way of blue laws as such here, though you probably can't sell it in the middle of the night. And liquor stores pretty much ALWAYS sell cigarettes (that's what I meant by making most of their money from "vice" - it's not just liquor ). And you need to sell some juice and stuff frankly just to go with the liquor, can't really make a mixed drink otherwise :). But the selection is a little better than that, some junk food etc, not really a grocery store though.
flowerseverywhere
2-18-12, 3:38pm
Actually I lied. You can get lottery tickets too now that I thought about it more. No juice, but I think you can get some mixers, like tom collins mix. No soda or waters though.
People think entrepreneurs and small business owners are the same thing. Sometimes they are, but usually the approach to what they do is quite different. Entrepreneurs often try to find a niche and figure out how to start a business that fills it. Small business owners often want to start a business and hope there is a niche they can fill with it. It's not a matter of deciding which is better, its a matter of deciding which mentality you really have and thus which is better for YOU.
Exactly.
Part of the equation that is that I do love what I do -- teaching yoga. But I also realized that the only way to truly make a living at it is through a passive income stream.
So, I looked at how to develop that as a business, so that I don't have to "do everything" -- which is true of a lot of small businesses.
First, there is my small business -- which is teaching yoga. This is my secondary business, kwim? The focus -- or my market -- is a niche: people working in this particular business district. Secondarily, I focus on getting people who have never done yoga to do yoga -- this cuts competition. A lot of yoga people focus on attracting yoga people to them, and away from their competitors. I circumvent this by focusing almost exclusively on developing new clients from the larger market of "people who do not practice yoga."
Second, there is the collective -- this has two aspects. I maintain the lease and the space, but other yoga teachers (or other movement people) rent the space from me. We do collective marketing (all marketing the same, which rent covers), and they also market themselves. The second part is small rooms for other kinds of practitioners who rent the space to see their clients. So, this creates passive income for me, while facilitating their small businesses.
Third, we are looking to franchise this collective. We have created a good brand and overall process. It's designed for a small business owner (such as a yoga teacher or massage therapist) to start a collective in their community. We have the administration aspects down to about 5-6 hours a week -- which, can be done by the owner/admin or could be done by an outside person (hired). We also provide some business coaching/support so that the person can create it.
This is another niche market. I know a lot of yoga teachers who run small businesses -- traveling all over creation to make a basic living. It's really tough on them (I did this for years). It is so much easier to be in one place. As an owner as well as a person with a small business within the business, you get the benefits of both -- having one place to do your own work (and attract people to you), while also making a passive income on other people's small businesses.
And, we already have people who are interested in the franchise, and I'm working to get the contracts and that side of things together now so that we can get their franchises underway.
----
Looking at my business now, here is what I did.
I started out with several renters and no yoga classes. I got the culture and general framework for the business set up. Then several practitioners left, and several more came on board. Then, I started the yoga studio, and several of my renters moved (all good positive leavings). So, I transitions so that the money from the yoga studio (the students) could cover all of the expenses of the business.
I reached that goal very quickly (within 3 months of making the decision). Now, i'm at the point where any new corporate client (a niche market, we supply yoga classes to local businesses), every new client/class pays rent to the business, and then my small business (teaching the class) takes the remainder.
See how the businesses run side-by-side?
I also have a couple of teachers looking to add about 4-5 new classes over the next 6 months (due to their schedules, travel times, etc), so those will also be 'renters.'
When the studio gets to 35 classes per week (currently at 16) all paying the rental rate, then it will support the expenses of the business. We are currently 1/3 full in our other rentals, and actively seeking new practitioners to rent for us. When the other rentals are 1/2 full, they will cover the expenses of the business.
The nice thing is that as one part grows, it supports the growth of the other parts, and if there is a change, it creates a buffer. Ie, yoga classes provide the buffer when a practitioner moves to auckland or whatever, but then practitioners provide a buffer until the studio grows in size, and right now, my small business is providing that buffer.
Does that make sense?
I don't know if it makes sense. :D
Spartana: exactly! It's not about qualifying.
It was frustrating because after university and before heading into law school, I applied for Americorps. I wanted to work after graduating from law school, and they would help pay for school in exchange (rather than me having to take out loans and then have americorps repay them after the fact).
Back then, though, they had positions that they wanted to fill (mostly teachers and doctors), though they did look for "community organizers" (or lawyers) -- and then you had to qualify, which wasn't just based on education or desire to serve. If you were "lower income" then they wanted to provide for those folks before a middle class person.
It may have changed since then (looks like it according their web site that they do provide things like civil service corps), but I essentially "wasn't eligible." I think it had something to do with the positions available in the region (philadelphia), and apparently they didn't need lawyers to serve for 2-3 years. I was hoping to do the summers during school (9 months) and then continue with the program for another 2 years after.
But, it may have been that I wasn't "accepted." Anyway, whatever it was, that was kinda frustrating. LOL
I seriously, honestly, and truly did try to get my graduate school loan-free. I did have a scholarship that I maintained ($3k/year), which did help, and I did get a couple of grants that I applied for (had to write papers for these, which was just a little extra work), to the tune of $3k total ($1k per year), I did some work study (value at $6k total), and the rest were loans.
I seriously would have done Americorps, if they had 'let' me.
But, hey, I've paid off 1/3 of them so far, and I have saved up about 1/3 of the amount to pay off the remainder (while still paying the interest payments). This year, any teacher training that I offer or similar, I put that right into the account for my student loans. And, if I get a private client, that money goes strait into that account as well. I don't earn enough to be taxed on that income at this point -- and since it all goes into that account, it's making a nice little interest and hopefully, I'll be able t pay off these stupid loans in 2-3 years!
flowerseverywhere
2-19-12, 8:57am
I suspect that's the point--like the recent law passed somewhere in the SE requiring drug tests of people seeking unemployment payouts. Of course, only a tiny minority (I think it was 2%) had traces of some naughty substance in their sample, but it had the effect of painting all the unemployed as drooling druggies. Ditto with the law cited above. Clever psychological warfare on the needy, redirecting what might otherwise be our rage at the powerful interests at the top of the heap toward "the least among us."
Jane, I did some research after your post. I was really curious as to why lawmakers would deal with this issue. For show? Shaming? or for good reasons?
this is from a Seattle newspaper
http://www.king5.com/news/local/13-thousand-welfare-recipients-access-cash-in-Casinos-114684519.html
"The new ATM data shows that of 68,000 welfare cash clients in the state, at least 20 percent withdrew cash at a casino last year. Even worse, DSHS expects that percentage to grow as it receives data from more casinos and card rooms."
the California figure was 1.8 million in nine months (a small fraction of the total), and some casino owners said they prohibited withdrawals from EBT cards yet they had been tried thousands of times to withdraw welfare benefits
http://www.pressdemocrat.com/article/20100629/articles/100629489?p=1&tc=pg
This is from Minnesota where the percentage seems to be much like what you have posted, less than 1% but they did find a lot of the money was accessed outside the state
http://minnesota.publicradio.org/display/web/2011/03/15/ebt-welfare-restrictions-spendings/
I didn't find any articles saying it was a huge problem in the greater scheme of things, but I know several people who after long bouts of unemployment settled in low paying jobs and would not dream of a casino visit or buying beer or liquor. Public perception will become a bigger and bigger problem as more people realize they probably will work to the day they die as pensions and social security wither away and medical expenses and taxes continue to rise. I don't see any way our country can continue without raising taxes at every level or defaulting on their promises to employees in the form of their health and pension benefits. It doesn't add up.
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Casinos out here are largely Native American owned and operated. Perhaps they're a community center of sorts?
I don't doubt at least some magical thinkers are convinced if they just hit it big they can get off assistance forever.
"Also, welfare beneficiaries will be banned from accessing public assistance funds at ATMs in strip clubs, liquor stores, and casinos."
from: http://www.cnn.com/2012/02/17/election/2012/payroll-tax-deal/index.html?hpt=hp_t3
Why were they ever able to? While this may be a small fraction any fraction is too much in my opinion. Of course people can still go to an ATM down the street but obviously if this was put into the wording it has to be somewhat of a problem.
What would you do if you had nothing to do and no prospects of a job? These are things any one of us might do, so why is it wrong for poor people to do the same things? I really dislike this moralizing about what welfare recipients should and shouldn't do, as if they should toe the line while those of us with money can do as we please.
I live in an over-55 development where the community association often organizes casino trips. Should the neighbors who live on Social Security be banned from going?
Casinos out here are largely Native American owned and operated. Perhaps they're a community center of sorts?
I don't doubt at least some magical thinkers are convinced if they just hit it big they can get off assistance forever.
Desperate people do desperate things, such as gambling, drinking hard, et cetera. I have experienced unemployment and I can't think of much that's more depressing.
Drug tests and ATM restrictions are just another way of blaming the victim, IMO.
Don't a lot of casinos offer really cheap meals? Maybe people are going there for the food, not the gambling.
lhamo
What would you do if you had nothing to do and no prospects of a job? These are things any one of us might do, so why is it wrong for poor people to do the same things? I really dislike this moralizing about what welfare recipients should and shouldn't do, as if they should toe the line while those of us with money can do as we please.
I live in an over-55 development where the community association often organizes casino trips. Should the neighbors who live on Social Security be banned from going?
I don't consider social sec an "entitlement" (nor do I consider unemployment insurance an entitlement) since you have to work many years and pay into the system in order to earn it. I see it as a mandatory Govmint sponsored retirement program for working people, not a welfare program for a needy person. And I think that's why so many people get angry at welfare receipiants gambling, drinking, or just basicly using that money - tax payer money - on items not needed for survivial (food, shelter, medical). The person on Soc Security earned that money and has the right to do whatever they want with it. The person receiving welfare aid has a moral obligation imho to use that money wisely to provide for themselves and their family. So moralizing about how welfare money is spent is justified I believe. My personal opinion is that they shouldn't even be allowed welfare aid unless there are some sort of incentives in place to make sure they are using that money temporarily and it will help them achieve their own future financial independance - whether that be mandatory education, part time work or volunteering, some sort of group home for minors with children, or some sort of contribution of their time to improve the community as well as better themselves for future employment. They don't HAVE do do any of those things if they don't want to, but then they won't receive any benefits either.
flowerseverywhere
2-22-12, 6:48pm
Jemima, to make this simple go to your state welfare page. It will state something similar to this:
"Temporary Assistance (TA) offers temporary help for needy men, women and children. If you are unable to work, can't find a job, or your job does not pay enough to meet your basic living needs, TA may be able to help you with your basic need expenses, such as heat, rent etc.Temporary Assistance is the term used in New York State for public assistance (welfare) programs. Temporary Assistance provides families and individuals with short-term help while they work toward self-sufficiency.
For families with children, federal and state laws have changed. Assistance is now temporary and time-limited. Cash assistance will only be available for up to 60 months in a lifetime. Any month or part of a month, since December 1996, in which cash benefits were received, counts toward your time limit."
note how it says basic living needs. Most of us consider that to be heat, rent, clothing, food and clean water.
Social security is a whole different animal. You pay in the minimum amount you get the minimum. You pay the maximum, you get the maximum. It was designed to supplement people's living expenses in old age.
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