Comments by "coolmodelguy" (@coolmodelguy6304) on "The Humanist Report"
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@jamesfournier9450 - I agree with everything you just wrote. Every system need regulation, which capitalism does not have. The only reason capitalism is not positively regulated is because wealth buys power, which is easy to understand but obscured by propaganda (which is also bought by wealth). My background is in engineering, which when applied to capitalism could make the system work for everyone . . . and therein is the rub, because those with wealth do not want capitalism to work for everyone. They have deliberately engineered programs like 401k's and IRA's with the tax penalty so that they could manipulate the average American, which as an engineer I can see what they wanted to accomplish. The goal was to kill off pension plans through employers and create a so-called retirement platform to drain wealth toward themselves and ensnare average American's as accomplices to their plan.
The device called "compounded interest" and it's deleterious effects has been well known for several centuries. In Michael Hudson's paper on compound interest called "The Mathematical Economics of Compound Rates of Interest: A Four-Thousand Year Overview Part II", he makes the following referral:
It was in reference to Britain’s war debts that one of Adam Smith’s contemporaries, the Anglican minister and actuarial mathematician Richard Price, graphically explained the seeming magic of how debts multiplied exponentially. His 1772 Appeal to the Public on the Subject of the National Debt described how “Money bearing compound interest increases at first slowly. But, the rate of increase being continually accelerated, it becomes in some time so rapid, as to mock all the powers of the imagination. One penny, put out at our Saviour’s birth at 5% compound interest, would, before this time, have increased to a greater sum than would be obtained in a 150 millions of Earths, all solid gold. But if put out to simple interest, it would, in the same time, have amounted to no more than 7 shillings 4½d.” In his Observations on Reversionary Payments, first published in 1769 and running through six editions by 1803, Price elaborated how the rate of multiplication would be even higher at 6 percent: “A shilling put out at 6% compound interest at our Saviour’s birth would . . . have increased to a greater sum than the whole solar system could hold, supposing it a sphere equal in diameter to the diameter of Saturn’s orbit.”
Ultimately what this means is that we cannot have an economy with any portion operating by compounding interest rates for either debt or wealth generation. Any economic system that uses compounded interest either must have a periodic reset and debt forgiveness, or the system crashes. The wealthy know this, they want the system to crash regularly so that they maintain power. The only way we escape this is to cap individual wealth accumulation at a set limit, plus put a floor under the bottom via UBI or similar mechanism, or provide for system resets in both wealth and debt. In other words, we cannot let the wealth engineer the system to benefit themselves.
Reference:
https://michael-hudson.com/2001/04/the-mathematical-economics-of-compound-rates-of-interest-a-four-thousand-year-overview-part-ii/
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@jamesfournier9450 - Getting back to the gold standard is a good measure to take, the news I have been reading on the subject indicates that gold will need to reach a price point in the area of $20,000 to $30,000 per ounce in order to back currency in circulation. There is something else to consider that no one really seems to recognize, that all systems, including economic systems, have limits. We treat our capitalist system as if there are no operational limits, which seemed to work in the past just fine. However, with the advent of the modern technological age, we have surpassed or exceeded the capabilities of capitalism, which is now causing enough issues for the system to start malfunctioning. Don't get me wrong here, capitalism is a meaningful system which is still capable, but like any system it has limits. The limits being exceeded on on both ends, or on the bottom and the top. On the bottom end people do not have the capital to buy or rent enough. On the top end the exponential gains in wealth are both sucking wealth from the main body at all levels, akin to a virus that is killing the host. To fix capitalism, limits need to be installed at both the bottom and top end of the wealth spectrum, as well as fixing currency to gold, or to a basket of commodities. If capitalism is allowed to rev up continually from the point we are currently at, it will collapse.
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@whysocurious7366 - One of the ways we ( regular people ) have been fooled over the past several decades is the lack of inflation applied to certain consumer goods. While the cost of housing, healthcare and education have skyrocketed, basic costs of bread, wine and home electronics have been relatively price stable. When considering your question, the first thought that occurred to me was the "gold hammer" and "gold toilet seat". When the government pays for something, the cost is possibly inflated to ridiculous levels, more than if the item was bought directly by consumers. This would lead to greater corporate corruption in my view.
I keep harping on the grievous error in how the economy as a system is currently understood. No functional system has an open bottom end and open top end, yet we allow our economy to operate with both. As an example of a useful system, what happens if your car's engine RPM drops too low or revs too high? On the low RMP end, the engine dies. On the high RPM side the engine will burn up and die. Every system has upper and lower limits, but not our economy? Why? The answer is that an open ended economic system is built for the wealthy, and it always crashes (which serves the wealthy).
People drop out of the bottom because the system cannot support them. The open top allows the very wealthy top drain resources from everyone else. The subsidizing of the 1% owner class companies is a direct result of the open top end, because there are no limits to wealth accumulation. However, it is a mistake to focus on the means of production as the problem source when the real debilitating root problem is the "money for nothing" "investment" scheme we have. The term "investment" is being deliberately misused, because real investment involves "risk and reward", while what our present system is simply "reward" (and exponential reward at that).
If we are to solve the pressing problems of our age, then we must close off the open ends of our economy. Put a floor under everyone (M4A, UBI, Housing Guarantee, Free College, etc) and put a hard cap ceiling on individual wealth accumulation. If you were to look at the cause and effect of a wealth cap in detail, the ramifications of a wealth cap would be the solving of a great many societal issues and the ushering in of a new "golden age" for humanity.
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@whysocurious7366 - I am totally in favor of workers owning and running the means of production. As in most things where critical decisions must be made in order to change the way we do business or politics, we must figure out which comes first . . . the horse or the cart. In the case of worker owned enterprises, those who own businesses now will never let go, so we are going to have to force the issue. There is one central focal point to all of our problems, which is that "wealth" prevents us from moving forward. This means we must take out the power arrayed against us, which means taking out wealth. Only when we eliminate the power of wealth will we get worker owned enterprises, nationalized health care, internet access as a utility, housing as a right instead of as an "investment", banking for the common good, the end of warfare generating profit and so on. We must focus on the real problem, which is "wealth buys power". I want individual wealth to be hard capped at perhaps $3 million, that number is high enough to live a life of luxury but not high enough to buy political power, which will prevent those akin to the former Koch Brothers from using excess wealth to alter our political and economic landscape.
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