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[iamblades]

*78% of the population cuts up their credit card and decides to only buy what they absolutely need
*every movie company goes out of business
*every ice cream and snack company goes out of business
*every car company goes out of business
*every restaurant goes out of business
*every college goes out of business
*everyone gets laid off
*everyone moves to live in a shack in rural Nebraska

Shit everything is perfect now, what were they waiting for

This is a very 'what is seen' view of economics.

First order effects are not the sum total of the economy.

If people saved more, they would have more to spend in total, not less. The only businesses who would suffer are the banks.

That image should tell everyone that subsidies do not work. Inflation exists basically in direct proportion to the degree in which an industry is subsidized or the true cost is otherwise obfuscated from the consumer.

 

[AndyD]

Why the 1% is not taxed at a 90% rate I'll never understand.

Those are the numbers for the 50s and 60s where the current administration is looking when talking about things being "great". Somehow I do not see the upcoming tax plan bringing that "detail" back.

 

[ClosingADoor]

Unions and strikes. Only way to make the corporations pay up a fair wage.

 

[Randolph Freelander]

This is a very 'what is seen' view of economics.

First order effects are not the sum total of the economy.

If people saved more, they would have more to spend in total, not less. The only businesses who would suffer are the banks.

Not quite.

Everyone saving wouldn't be sustainable, because it would trigger a recession by definition, resulting in job losses and the inherent inability for everyone to save.

See: Paradox of Thrift

 

[Bert409]

This is one of the reasons why I don't want kids and own a house. I live a comfortable, low stress life well within my means, and I don't want anything to theaten that.

 

[Narpas Sword0]

The avocado toast reference makes me unsure if this is a serious post but I'll respond anyway. Posts like yours have been made throughout this thread and many people have explained the problems with it.

The first problem is that the whole economy is built around people spending their disposable income. If everyone suddenly became super frugal and saving every last penny the economy would take a huge hit.

The other problem is that your argument ignores all the significant factors leading to this problem only to focus on a less important issue to attempt to pin everyone's problems on personal self control. When a problem like this applies to the vast majority of the population that suggests that it's a systemic or social problem rather than an individual one.

Wages are stagnant. You now need to go into more debt via student loans to get those same low wages. The cost of living also continues to rise. This makes it harder for the average person to get by regardless of how well they save.

Sure if every single person became incredibly financially savvy and saved every penny they'd be better off. If you ate only the cheapest possible foods, spent nothing on any for of entertainment or things to enhance or your life and saved/invested every single spare cent you had you'd be better off financially. The reality is though that we're not all perfect and we can't all adhere to strict guidelines like that. Also it's unfair to expect poor people to make all these massive sacrifices just so they don't have to risk going bankrupt due to literally any negative unforeseen event.

Why shouldn't people be able to spend a little bit of their money doing things or buying things that make their life enjoyable? Should that be a privilege that's withheld only for the richest few percent of the population.

I'm not saying that financial education has no place in the solution to this problem. We absolutely should be teaching kids growing up far more about how to handle money and be inancially responsible. Compared to the other issues causing this problem it's simply another drop in the bucket. Also as things continue to get worse and the gap widens further no amount of financial prudence will allow the people at the bottom to avoid living pay check to pay check.

Additionally, everyone is saying "invest, invest." Even if cutting away all the pleasantries of modern life keeps you out of debt, it won't necessarily leave enough to invest.

Also, what's investment? It's buying up stocks which is another rich people circle jerk that funds corporations, or it's buying up real estate which drives up prices and fucks poor or up-and-coming people too. A home is only an "investment" if someone else is getting fucked later.

You can't simultaneously say the solution is to "invest in real estate" and "move to a cheaper place to live." The former only works when people don't do the latter. Kind of like "don't have kids" and "capitalism will continue to exist."

 

[dragonyeuw]

wage growth has been truly pathetic for the middle class.

I don't know about a middle class. More like the working poor and the elites with the political and economic power firmly entrenched at the top.

 

[Mesousa]

So now we're getting to the point where a huge portion of the population is essentially priced out of having children? That or basically accepting that they will end up barely scraping by as a result. You're really ok with that?

For a lot of people if not the majority of people your suggestion would lead to them either never having kids or having them at an age where the health risks involved have went up substantially.

Im well aware of the financial responsibility of having a child. It's why my partner and I are waiting till after we're both 30 to have children despite being quite well off and having lots of family support.

Again though you're missing all the massive significant structural barriers making it difficult for people with children to get by and instead are trying to bring it down to a single minor issue, personal responsibility.

If you cant afford them don't have them shouldn't be an extreme position. Its common sense that you yourself seem to be following.

In the past kids were a necessity to work your farm. Now? They are a luxury most people cant afford to have.

 

[johnny956]

Not quite.

Everyone saving wouldn't be sustainable, because it would trigger a recession by definition, resulting in job losses and the inherent inability for everyone to save.

See: Paradox of Thrift

Not everyone agrees with the paradox of thrift Say's Law

Short term I could see it being an issue but long term if people aren't paying 20%+ APR on credit cards and payday loans then realistically more money would be able to be spent it would just take time for that to happen

 

[zeelman]

Unions and strikes. Only way to make the corporations pay up a fair wage.

If the unions were strong enough, sure. The union for my grocery store job is pathetic. They just approved a new contract that gave us a one dollar raise over the next 5 years. This tiny wage increase is wiped out by a significant increase in our insurance costs.

 

[Narpas Sword0]

If you cant afford them don't have them shouldn't be an extreme position. Its common sense that you yourself seem to be following.

In the past kids were a necessity to work your farm. Now? They are a luxury most people cant afford to have.

An expanding population is a necessity for successful capitalism.

And it is an extreme position when the requirement applies to 78% of the population.



Seventy eight percent

 

[iamblades]

Not quite.

Everyone saving wouldn't be sustainable, because it would trigger a recession by definition, resulting in job losses and the inherent inability for everyone to save.

See: Paradox of Thrift

That assumes everyone starts saving immediately, which was not what I was suggesting.


Point is just that over time savers spend more than non savers, so it would be a long term benefit to the economy.

Also if we are just trying to get people to not live paycheck to paycheck, the amount of savings required would be insignificant to the total economy.

An expanding population is a necessity for successful capitalism.

And it is an extreme position when the requirement applies to 78% of the population.



Seventy eight percent

No it is not. Japan's population hasn't been expanding and will never expand again, and capitalism works just fine there.

People always confuse the desires of investors and the stock market for the demands of capitalism.

Investors of course want overall growth, it makes it super easy to be an investor.

 

[Narpas Sword0]

78% of people doing nothing but work, buy groceries, and sit at home with no TV, phone or internet: no big deal for a service economy that is 2/3rds consumer spending


Famously strong economy with famously happy workers: Japan Though they at least have something approaching the safety net required to make a transition. Something we can't have as long as everyone is telling everyone to bootstrap their way to prosperity like in this topic.

 

[UberLevi]

Oh yeah, I've been working at the same place for a year and have nothing in savings. Student loans, rent, and food expenses eat up about 80% of my income each month.

 

[aeolist]

No it is not. Japan's population hasn't been expanding and will never expand again, and capitalism works just fine there.

People always confuse the desires of investors and the stock market for the demands of capitalism.

Investors of course want overall growth, it makes it super easy to be an investor.

isn't japan's gdp to debt ratio something like 250% and climbing?

 

[LegendofJoe]

If you cant afford them don't have them shouldn't be an extreme position. Its common sense that you yourself seem to be following.

In the past kids were a necessity to work your farm. Now? They are a luxury most people cant afford to have.

Do you see this as acceptable? Steady, incremental population decline is desirable, but drastic population decline would have terrible social consequences. I'm not sure I want to live in a society where the majority of people cannot have children.

 

[F34R]

We are a paycheck to paycheck kinda family, but mostly because we spend too much on things we want, and rarely is it because of what we need.

If we budgeted better, and stopped buying stuff on credit, we'd do a lot better.

My wife's employer hasn't given them meaningful raises over the 8 years she's been there. We use night shift, and weekend differential bonuses to help. I think she's seen a $1.00/hr increase over 8 years.

We have a $4000.00 cushion in the main checking account. $4000 = 0 for us. There's $25 in savings lol. Pathetic, I know.

One year from now, my wife's mini cooper will be paid off, and we aren't getting another. That's $600 going to help pay off whatever credit card debt we have still. Chipping away at that every month.

I also help my dad with his bills, he's in bankruptcy right now. Health problems, and he can't work. SSD + military retirement weren't enough. We help with my wife's parents, grandmother as well. There's a lot more into it each month than just what we spend on ourselves.

Healthcare insurance is ridiculous for our family, $1200 a month. Student loans aren't bad at $400 a month. I'll spread sheet a budge/income table and watch everyone facepalm after seeing how bad I am with spending lol.

We'll do better in September, as long as there aren't any awesome Lego sets being release. /snicker

 

[Fliesen]

There's been multiple times where - when our head of accounting was on vacation for a week and wage bank transfers didn't happen on the first of the month - multiple of our employees asking whether or not they could receive a partial cash advance to bridge the few days until bank transfers would happen...

It's especially striking once you realize that those were (mostly) not younger employees who possibly were bad at financial planning or overspent on luxury items via installment plans, but also older ones who live in a double income household.

My girlfriend keeps telling me those anecdotes about some of her friends - college graduates (no debt though, Austrian college...) - basically never having more than 3 digit savings.

I just try my best not to judge, really. :/

 

[ErasureAcer]

Why the 1% is not taxed at a 90% rate I'll never understand.

The vast majority of PoliGaf would disapprove.

 

[dpunk3]

This country is never getting fixed. It's too rigged and unless we tear down Wall St and start again there's no way we'd get any kind of equality in this country. The 4th amendment prevents wealth redistribution on a large scale, and that's what we need to equalize things out. We're fucked, pure and simple.

 

[Bluenoser]

The worst part of all of this, is that these corporations are constantly moving the earnings targets in more aggressive directions, meaning the grunts doing the hard work (aka the average person) works harder, so they can make more and more, each year, with none of the extra profits trickling back down to the common folk.

I work in a company like this, and each year, our "plan" is more aggressive than the last, and is constantly looking out for shareholders, but never the hard working people that allow the company to succeed.

Shit's gotta change man, because this can't be sustainable much longer. In the past 3 years, I've gotten ONE 1.5% raise.

Meanwhile, my wife, who has a skill-set that's in demand, and has been headhunted by some companies, has changed jobs 4 times over the past 5 years, and has made more money each time via negotiation. If you are in demand, fuck staying loyal to a company.

 

[Mesousa]

Do you see this as acceptable? Steady, incremental population decline is desirable, but drastic population decline would have terrible social consequences. I'm not sure I want to live in a society where the majority of people cannot have children.

I see it as optimal. Too many people on earth.

 

[Somnid]

If you cant afford them don't have them shouldn't be an extreme position. Its common sense that you yourself seem to be following.

In the past kids were a necessity to work your farm. Now? They are a luxury most people cant afford to have.

You understand the net effect is telling minorities they should die out, right? Whether or not you dislike humanity, social reproductive control, even indirectly is extremely slippery.

 

[dragonyeuw]

Meanwhile, my wife, who has a skill-set that's in demand, and has been headhunted by some companies, has changed jobs 4 times over the past 5 years, and has made more money each time via negotiation. If you are in demand, fuck staying loyal to a company.

Basic rule of thumb is you're far more likely to increase your salary substantially by moving every few years, then sticking with one company especially ones who stick to 1% increases if you're even lucky enough to get that. I got an email at the start of our current fiscal year outright saying there will be no COL increase this year, but my company insurance has increased so I'm making less money than I was last year.

 

[ChubbyHuggs]

That with this

Nearly six in 10 Americans don't have enough savings to cover a $500 or $1,000 unplanned expense, according to a new report from Bankrate.

is depressing.

 

[Mesousa]

You understand the net effect is telling minorities they should die out, right? Whether or not you dislike humanity, social reproductive control, even indirectly is extremely slippery.

That is quite the leap there wouldnt you say?

 

[cryptic]

The not-too-shocking conclusion I'm getting from this thread is that people are more willing to place the blame on the worker for failure to budget than the employer.
I think it must feed into a feeling of personal success, to say,"Well, I budget, you can't, maybe I'm better than you."
Budgeting is by definition limiting so I figure it goes back to the underlying religious tenets of society where suffering is taught to be good.
Ultimately people who brag about the success of their budget are bragging about their strength, their ability to endure more, to suffer more, and also, their lazy acceptance of this as "just the way things are".
Rather than asking what can be done?

I budget to where all my money goes to food, clothing, I work over forty hrs., a week, I've been unable to afford more than a gallon of milk, oj,and some junk food for years.
Milk for protein, junk for calories, oj for nutrition.
I've lived all over.

How tight do I have to get? All my clothes are falling apart and I'm afraid to buy more.
I feel guilty after every purchase.
How strong and intelligent do I have to be?
How do I qualify for your exemption into acceptance?

 

[Somnid]

That is quite the leap there wouldnt you say?

Not really, look at wealth demographics and then understand that a "no money, no baby" stance translates directly into that whether it's your intention or not.

 

[Kieli]

To be fair, living paycheck to paycheck can include the "I make a shit ton of money but have to pay for this new house, two new cars, boat, family vacations, college for 3 kids, our constant dining out and entertainment budget, etc" demographic as well.

Even if every upper-middle class person or family was irresponsible with their money, it wouldn't even constitute 10% of the 78% of people living paycheck to paycheck.

 

[entremet]

Senator Elizabeth Warren wrote a book called The Two Income Trap. In it, she mentions that dual incomes for the middle class have actually been negative.

Why?

Childcare costs, lower quality parenting experience, and an arms race in housing prices. I do think that there's is a stigma to being a primary caretaker, for both sexes. But it's extremely expensive as is.

 

[AstroNut325]

Senator Elizabeth Warren wrote a book called The Two Income Trap. In it, she mentions that dual incomes for the middle class have actually been negative.

Why?

Childcare costs, lower quality parenting experience, and an arms race in housing prices. I do think that there's is a stigma to being a primary caretaker, for both sexes. But it's extremely expensive as is.

Yup. The labor markets have been diluted beyond recognition. In just a few decades, the labor pool available in the USA doubled due dual-income households. Now add globalization, trade, ect. You have a system that favors/tilts extremely towards the benefits of big business.

 

[UserNotFound]

Huh?

Edit:

Down payment and closing costs were paid out of my own and my gf's savings split 50/50. We only put 5% down as PMI is minimal (approx $80-90 a month..would have to go back and look at the paperwork). This allowed us to leave ample funds in our bank accounts and in less than a year that money spent was already recovered back into savings.

I still don't understand the question or the point you are trying to make.

It seems you'll never understand. The question was in snark. I don't care about you, your girl, or your personal financial situation. I have no real stakes in the outcome of your future. My point was that the response you had to an article saying that 78% of America is struggling financially to survive is "fuck you I'm getting mine". You missed the point entirely but it's not like you give a shit right? You shared your details to brag.

I live in a city with homelessness, a 97-98% rental occupancy rate with construction happening in luxury apartments and not in subdivisions with managed costs and big ass homes that sit vacant months on end because they are some assholes vacation home. Even the single rooms are collecting 1,000 monthly because my market is that dire and because the lease owners are straight lying to the landlord about where the money comes from. You don't see the bigger picture here.

A lot can happen to a worker with only a High School education in the next few decades. Layoffs, executive bonuses, automation, bankruptcy, etc. By then you won't feel confident or comfortable sharing your finances. Maybe you'll start to feel economic anxiety and then vote for someone who will ultimately sever any safety net you ever had in the first place.

Ultimately, I wish you luck in you future. Kids are expensive, so is healthcare. 50K won't be remotely close to enough.

 

[AdventureRacing]

If you cant afford them don't have them shouldn't be an extreme position. Its common sense that you yourself seem to be following.

In the past kids were a necessity to work your farm. Now? They are a luxury most people cant afford to have.

Is that really an acceptable position? Do you really think it's ok that we're in a situation where close to 80% of the population simply can't have kids because they can't afford it? Poor people already have to make huge concessions and go without many things but now you're suggesting they shouldn't be able to procreate either.

I understand your position that the worlds population is already big enough but the solution to that isn't stopping the majority of the population (namely poor people) from being able to have kids.

 

[Flo_Evans]

Shit sucks and is only going to get worse. We had a chance to elect a leader who was at least acknowledging these fundamental problems and we blew it.

Lol as I am posting this I just saw a commercial on a "news" channel urging me to call my congressperson to lower taxes on poor multinational corporations.

Shit is so fucked I can't really blame people for not saving for the future. I do my best but really it's just going to make me a target when shit really goes south.

 

[Quixzlizx]

78% of people doing nothing but work, buy groceries, and sit at home with no TV, phone or internet: no big deal for a service economy that is 2/3rds consumer spending

This false dichotomy in the thread is annoying. There's a wide range of possibilities between not owning a smartphone or having any cell phone service, and upgrading to the new iPhone every year with an unlimited Verizon plan. Or between never leaving the house and spending $250 a month just on going out and boozing.

Not that I am accusing anyone of doing those things, but I feel like the opposite view is implying "the system is rigged against you, so do whatever the fuck you want, since your fate was sealed from the beginning."

It's possible for life to be unfair and to also personally engage in self-destructive behavior. Like, it's unfair that tobacco companies lied about and suppressed the addictive and unhealthy aspects of smoking for decades while marketing to children, but it's still a bad idea to smoke.

 

[ArkhamFantasy]

Is that really an acceptable position? Do you really think it's ok that we're in a situation where close to 80% of the population simply can't have kids because they can't afford it? Poor people already have to make huge concessions and go without many things but now you're suggesting they shouldn't be able to procreate either.

I understand your position that the worlds population is already big enough but the solution to that isn't stopping the majority of the population (namely poor people) from being able to have kids.

I think the blame should go to the ultra wealthy for putting 80% of the population in a financial situation where they cant afford kids, rather than blaming poor people for not having kids that they cant afford to take care of.

 

[aeolist]

This false dichotomy in the thread is annoying. There's a wide range of possibilities between not owning a smartphone or having any cell phone service, and upgrading to the new iPhone every year with an unlimited Verizon plan. Or between never leaving the house and spending $250 a month just on going out and boozing.

Not that I am accusing anyone of doing those things, but I feel like the opposite view is implying "the system is rigged against you, so do whatever the fuck you want, since your fate was sealed from the beginning."

It's possible for life to be unfair and to also personally engage in self-destructive behavior. Like, it's unfair that tobacco companies lied about and suppressed the addictive and unhealthy aspects of smoking for decades while marketing to children, but it's still a bad idea to smoke.

talking about personal responsibility with regard to systemic problems actively impedes discussion and the search for solutions. posts like this do lots of work for right-wingers and the 1% even if you don't mean for them to.

 

[Unknown Soldier]

Why the 1% is not taxed at a 90% rate I'll never understand.

The 1% largely keep their wealth in assets which are not taxable as income. If you actually want to tax the 1% you need to impose a wealth tax.

 

[Quixzlizx]

talking about personal responsibility with regard to systemic problems actively impedes discussion and the search for solutions. posts like this do lots of work for right-wingers and the 1% even if you don't mean for them to.

Things that individuals can do to partially mitigate the unfair situations they are in is not the same as political ideology.

If someone gives the advice on a college campus for women not to leave their drinks unattended at parties or to walk around alone at night, would you denounce that person as enabling systemic patriarchy?

 

[aeolist]

Things that individuals can do to partially mitigate the unfair situations they are in is not the same as political ideology.

If someone gives the advice on a college campus for women not to leave their drinks unattended at parties or to walk around alone at night, would you denounce that person as enabling systemic patriarchy?

if statistics about college date rape are being discussed and that person's response is to tell women to not get raped then yes

similarly i think it's great if someone wants to work with low-income households to help them with financial planning, but that's not the same thing as coming into this thread and saying that people need to learn how to budget

 

[lt519]

We really need schools to start teaching personal finance.

This has to happen. It may be the most important thing. My wife works in the public sector as a foreclosure and/or eviction attorney. A lot of people are just living outside their means and she basically has to do their budgets for them to work out a deal with the banks so they can keep their houses. Sorry you don't need $250 in TV/Cell Phone bills and pack of smokes a day when you can barely pay your $500 a month mortgage.

I'm continually shocked at how many of my very well educated and well paid peers in their 30s are house poor as well.

There are obviously many circumstances where wages aren't what they need to be, but there's always two sides. People need to be held accountable as well.

 

[Wag]

End the minimum wage and let the free market take over. That will solve everything...

 

[Quixzlizx]

if statistics about college date rape are being discussed and that person's response is to tell women to not get raped then yes

similarly i think it's great if someone wants to work with low-income households to help them with financial planning, but that's not the same thing as coming into this thread and saying that people need to learn how to budget

Except I didn't do that, I was responding to people who were saying the equivalent of "low-income people shouldn't have to budget, they should be provided with more money" while shooting down the strawman nobody claimed that poor people shouldn't be allowed to spend one dollar on discretionary spending. I'm not sure how helpful that statement is, either.

 

[The Greek Freak]

This is one of the reasons why I don't want kids and own a house. I live a comfortable, low stress life well within my means, and I don't want anything to theaten that.

While we own a house kids are basically out of the question because we don't want the financial stress.

 

[muu]

This has to happen. It may be the most important thing. My wife works in the public sector as a bit foreclosure and/or eviction attorney. A lot of people are just living outside their means and she basically has to do their budgets for them to work out a deal with the banks so they can keep their houses. Sorry you don't need $250 in TV/Cell Phone bills and pack of smokes a day when you can barely pay your $500 a month mortgage.

I'm continual shocked at how many of my very well educated and we'll paid peers in their 30s are house poor as well.

Working at an engineering firm I figured most people are at least somewhat savvy with their money. I had a 30min meeting w/ the folks managing our 401K, among other things I learned was that despite matching up to 4% 1/3 of the company does not participate. Fucking insane to think people are this good at throwing money away.

 

[Durden77]

I know I do. It sucks ass.

 

[aeolist]

Except I didn't do that, I was responding to people who were saying the equivalent of "low-income people shouldn't have to budget, they should be provided with more money." I'm not sure how helpful that statement is, either.

pointing out that telling the majority of consumers to drastically cut back on consumption would have an adverse effect on the economy is not the same as what you just said

 

[kirblar]

End the minimum wage and let the free market take over. That will solve everything...

Ending it by providing UBI and giving workers far more individual leverage in the marketplace would be helpful though.

 

[Somnid]

talking about personal responsibility with regard to systemic problems actively impedes discussion and the search for solutions. posts like this do lots of work for right-wingers and the 1% even if you don't mean for them to.

I think it's also important to recognize that not having to judiciously track every dollar in and out should not be a luxury. It's a huge cognitive load, extremely stressful and eats time. But even for those that don't subscribe to that: avocado toast is measured in dollars, iPhone in hundreds of dollars, but necessary services like education, healthcare, childcare and housing are measured in tens of thousands of dollars. It takes 2 orders of magnitude for frivolous spending to add up to one need. Sometimes it happens with drug and gambling addicts but aside from the ingrained personality problems that go with that, it's just not a significant amount of Americans.

 

[DogDude]

Glad to know I'm better than 78% of America