AMERICAN CONSERVATISM IN 2008 AND BEYOND

@joefromchicago,

I guess roughly 3% more in taxes for the very wealthy which apparantly must include Foxfyre is "redistributing wealth." I wonder how many of the very wealthy refused the stimulus package checks? Are they in fear of running out of pins?

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@Foxfyre,

Foxfyre wrote:

The lesson, however, was that if you take away the incentive to achieve prosperity, the lack of effort to do so will eventually hurt everybody.

Do you disagree?

On this level of generality, yes I disagree. Whether you hurt everybody depends on how much income you redistribute, not on whether you redistribute any at all.

If you redistribute only a small percentage of the national income, you don't hurt everybody. You hurt the rich and help the poor. As you redistribute a greater and greater part of the pie, you discourage the pie-bakers* more and more, and the poor gain less and less from the increase of their share. At some point, from the standpoint of the poor, the growth of their slice just offsets the shrinkage of the total pie. That's the point beyond which further redistribution hurts everyone.

You as a conservative should recognize this pattern: It's a variant of the Laffer curve.

Now, what the "professor" did was set up an experiment at the extreme right edge of the Laffer curve. American liberals and European Social Democrats propose curves that are somewhere in the middle of the curve. The "professor"'s experiment is set up for dramatic effect, but not for telling us anything about any realistic liberal policy. In other words, it's a strawman.

------
* to keep the discussion focused, I will go along with your and the professor's assumption that income is a return on pie-baking, not on selling phony pie-based financial assets to buyers who don't understand them. Not all income reflects merit, and not all poverty reflects sloth. But I suggest we postpone this discussion for some other time.

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I think that this proves, more than anything else, the follies of arguments based on chain emails one receives. It basically misunderstands human nature and was pretty obviously made up; it isn't an actual example, but one person's extrapolation of what the class would do if it was made up of nothing but themselves.

Cycloptichorn

1 Reply

@joefromchicago,

What you are ignoring is the qualifier in the email about 'spreading the wealth around'. The professor knew averaging the grades would not initially affect those in the middle. The only ones who would be 'hurt' would be those at the top. That was Obama's plan. Obama didn't specify individuals who would be targeted, but his implication was that 'spreading the wealth around' would benefit everybody.

The experiment illustrated clearly that with the new policy, the 'poor' were initially made less 'poor', and the only ones who got hurt were the 'rich'. Nobody cared except the rich. But once you changed the behavior of the rich, everybody became poorer.

In that condensed setting, the professor couldn't very well transfer grades from the rich to the poor in that setting without everybody seeing the unfairness of it. So, he used a more subtle approach to 'spread the wealth around' and teach the lesson. The 'rich' didn't see it coming until it was too late. The middle didn't care. The poor thought it was a great idea.

And then everybody was poor and nobody liked it.

Is the lesson lost on everybody but me here?

2 Replies

@joefromchicago,

The professor's lesson was the ultimate and inevitable results of 'spreading the wealth around' when that is accomplished by taking more from those at the top to benefit those at the bottom.

But we can (and probably will) discuss the fine points of detail of the various economic initiatives when those become available.

Here is the first major volley if it gets legs and flies:

Quote:

July 16, 2009

Congressional plans to fund a massive health-care overhaul could have a job-killing effect on New York, creating a tax rate of nearly 60 percent for the state's top earners and possibly pressuring small-business owners to shed workers.

New York's top income bracket could reach as high as 57 percent -- rates not seen in three decades -- to pay for the massive health coverage proposed by House Democrats this week.

The top rate in New York City, home to many of the state's wealthiest people, would be 58.68 percent, the Washington-based Tax Foundation said in a report yesterday.

That means New York's top earners, small-business owners and most dynamic entrepreneurs will be facing new fees and penalties.

The $544 billion tax hike would violate one of President Obama's ironclad campaign promises: No family will pay higher tax rates than they would have paid in the 1990s.

Under the bill, three new tax brackets would be created for high earners, with a top rate of 45 percent for families making more than $1 million. That would be the highest income-tax rate since 1986, when the top rate was 50 percent.
http://www.nypost.com/seven/07162009/news/regionalnews/dem_health_rx_a_poion_pill_in_ny_179525.htm

1 Reply

@Foxfyre,

And now I must go sing for awhile. Later all. . . .

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@Foxfyre,

Foxfyre wrote:

Is the lesson lost on everybody but me here?

You're assuming there's a lesson there to be lost on anyone. There isn't. You're just seeing things you like to see, but who aren't there.

Enjoy the singing!

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@Foxfyre,

Foxfyre wrote:

What you are ignoring is the qualifier in the email about 'spreading the wealth around'.

I'm not ignoring anything. Indeed, as your responses make abundantly clear, I understood your e-mail better than you did.

Foxfyre wrote:

The professor knew averaging the grades would not initially affect those in the middle. The only ones who would be 'hurt' would be those at the top. That was Obama's plan. Obama didn't specify individuals who would be targeted, but his implication was that 'spreading the wealth around' would benefit everybody.

But the "professor" spread the grades/wealth around in a very specific way. He averaged all the grades. That's stated explicitly in the e-mail. Had he simply taken one or two points away from the scores of the top 10 percent of test takers and redistributed them to the bottom 20 percent, that would have been a closer analogy to one of the plans put forward in favor of health care reform (I wouldn't, however, necessarily jump to the conclusion that it's Obama's plan), but it wouldn't be the same experiment that the e-mail actually describes.

Foxfyre wrote:

The experiment illustrated clearly that with the new policy, the 'poor' were initially made less 'poor', and the only ones who got hurt were the 'rich'. Nobody cared except the rich. But once you changed the behavior of the rich, everybody became poorer.

Only if the grades weren't scored on a curve. If the grades were curved, then every student would have earned a "C" for the first test and every test thereafter.

Foxfyre wrote:

Is the lesson lost on everybody but me here?

That's difficult to say. Since you never learned the lesson in the first place, it would have been hard for you to lose it.

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@Cycloptichorn,

Cycloptichorn wrote:

I think that this proves, more than anything else, the follies of arguments based on chain emails one receives. It basically misunderstands human nature and was pretty obviously made up; it isn't an actual example, but one person's extrapolation of what the class would do if it was made up of nothing but themselves.

Cycloptichorn

There's a good deal of truth in that. The e-mail actually posits a form of the "Prisoner's Dilemma." Everyone in the class has an incentive to cooperate, so that their grades are as high as possible (the highest scorers are still better off if they get "A"s, even if their scores are ultimately averaged into "B"s). On the other hand, each individual student has an incentive to "defect" (i.e. not do any work at all) and be a free rider on the efforts of his/her fellow students. And since no one can guarantee that the other students will cooperate, then each student would rationally choose to defect (as eventually happens in the e-mail).

There are, however, ways to avoid the Prisoner's Dilemma. One way is to devise a way to insure cooperation, either through a system of incentives or through a system of punishments. For instance, if the biggest, meanest bully in the class promised to beat up any student who got an "F" on the test, then that would skew the incentive structure in favor of cooperation by altering the strategic "payouts" for each student.

In the real world, the government takes on the role of the class bully (or the class benefactor, who distributes goodies to the students who get good grades). For conservatives, then, the experiment in the e-mail may resemble real life because conservatives either don't appreciate the role of the government in controlling the free rider problem or else don't want the government getting involved. They think the classroom experiment reflects the real world, when, in truth, it doesn't even reflect classrooms.

3 Replies

@joefromchicago,

Quote:

They think the classroom experiment reflects the real world, when, in truth, it doesn't even reflect classrooms.

Absolutely correct; it reflects themselves. Quoting Okie from the economics thread:

Quote:

Principles of human nature apply in many realms of business, ci. If a person can make a buck without being accountable, they will.

The experiment ignores that there are other reasons to do well on tests besides grades, and assumes a generalized downward pressure with no countervailing upward pressure being applied.

Cycloptichorn

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@Foxfyre,

That's not even a so-called "lesson." It teaches nothing based on reality; it's all junk rhetoric without any redeeming lesson to be learned. Typical conservative lesson in fear-mongering.

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Snopes.com discusses the e-mail about the professor's lesson here:
http://www.snopes.com/college/exam/socialism.asp

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@wandeljw,

How did they know in 1994 what Mr. Obama's "plan" was going to be?

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@joefromchicago,

Next thing, Joe, you are going to tell me that all these pills I bought on the internet will not, in fact, enlarge my penis. That's nonsense! I have thousands of e-mails saying otherwise. I'm sure a few of them were even written by "professors".

1 Reply

@ehBeth,

They didn't, but they did learn about fear-mongering socialism and communism in a capitalistic society such as in the US. They didn't learn anything else; their concepts are misplaced and irrelevant to our country. They only parrot the party line of fear.

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@ehBeth,

ehBeth wrote:

How did they know in 1994 what Mr. Obama's "plan" was going to be?

"Biblical College", quite obvious.

1 Reply

@Walter Hinteler,

I believe it was "MAC college."

1 Reply

@cicerone imposter,

It's a prophesy. "And behold, when the sixth seal was opened, I saw four horsemen. One of them rode a black horse, yeah he was black himself. And on his shield was an inscription: 'Spread the wealth around!'"

Am I the only one who realizes that The End is Nigh?

1 Reply

@Thomas,

Thomas wrote:

Next thing, Joe, you are going to tell me that all these pills I bought on the internet will not, in fact, enlarge my penis. That's nonsense! I have thousands of e-mails saying otherwise. I'm sure a few of them were even written by "professors".

You mis-spelled "perfessers."

1 Reply

@joefromchicago,

Great. Now I'll need all the Vicodin I bought just to calm down from this shock.

0 Replies

AMERICAN CONSERVATISM IN 2008 AND BEYOND

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