The Benefits of the Fair Tax
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11-02-2014, 02:20 PM
RE: The Benefits of the Fair Tax
(11-02-2014 01:41 PM)frankksj Wrote:  
(11-02-2014 01:32 PM)Cathym112 Wrote:  Its like watching your gas gauge to determine how fast your car is currently going.

Wow, you're dense. Everything you posted in Wikipedia is uncontroversial common knowledge. But it doesn't explain why the gini coefficient changed course in 1971. Regardless of what you think it does or does not measure, WHY DID IT CHANGE COURSE IN 1971? And a bonus question: who predicted the change before it happened?

It doesn't matter if it's measuring gas or speed, in your silly analogy. If you cannot explain what is causing the needle to move, then obviously you don't understand what it's measuring.

Understanding how a needle moves on a measurement tool, or what is causing the needle to move, in no way makes using a speedometer the correct tool for determining how much gasoline is in your gas tank. The needle movement is irrelevant if you aren't using the correct tool.

How the metal alloy in a scalpel is determined is completely irrelevant to how to drive a nail home with a hammer.

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11-02-2014, 02:25 PM
RE: The Benefits of the Fair Tax
(10-02-2014 03:03 PM)wazzel Wrote:  I am not working under the assumption that the feds have to provide services, but the fact that they do. I think many many things could be done more efficently at the local level with less federal involvement, but that is not how we are set up.

The Civil War didn't alter the roles and responsibilities of State vs Federal government. Instead, the Federal government has slowly expanded its role by pushing the limit when the SC was stacked with corrupt imbeciles.

For example, the war on drugs is justified under the Interstate Commerce clause. But how on earth does growing pot for your own consumption count as interstate commerce? It doesn't obviously. But this was justified through a novel 'interpretation' of interstate commerce that expanded it to anything that in any way impacts anything economic - an absurd overreach. (Wickard v. Filburn).

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11-02-2014, 03:24 PM
RE: The Benefits of the Fair Tax
(11-02-2014 02:16 PM)Cathym112 Wrote:  I've already answered you...a couple of times.... BUT, as I said before....

Bull-shit. This is the first time you tried to address this issue.

Regarding your claim that the gini coefficient "is still the wrong tool to be using to determine income inequality", well it's the tool that the UN, the OECD, and every other organization uses to measure inequality. If you have a better tool, what do you recommend using instead?

Now, as far as your explanation as to WHY the gini coefficient reversed course in 1971, your answer is pretty comical.

(11-02-2014 02:16 PM)Cathym112 Wrote:  there was a change in the co-efficient because prior to 1971, WOMEN weren't in the work force!

I can guarantee you just made that up. I've read a lot on the subject from both the left and right, and this is the first time I've heard anybody say the reason why since 1971 all income has been concentrated at the top is because women entered the workforce precisely in that year. Laughat

[Image: womenwork2.jpg]
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11-02-2014, 08:08 PM
RE: The Benefits of the Fair Tax
(11-02-2014 03:24 PM)frankksj Wrote:  
(11-02-2014 02:16 PM)Cathym112 Wrote:  I've already answered you...a couple of times.... BUT, as I said before....

Bull-shit. This is the first time you tried to address this issue.

Regarding your claim that the gini coefficient "is still the wrong tool to be using to determine income inequality", well it's the tool that the UN, the OECD, and every other organization uses to measure inequality. If you have a better tool, what do you recommend using instead?


They use the tool, but the economists who uses it, understands the limits of it. Changing demographics, such a baby boom, can drastically move the numbers! The problem is that you have no idea what the limits are and are using the tool incorrectly. That is my point.


As far as a better tool, well, for starters the mean-normalized second-order dominance, or Lorenz dominance. But again, I'm sure you have no idea what that is.

As far as the other shit you posted. http://www41.homepage.villanova.edu/klau...Shank.pptx

There ya go. The paper specifically mentions women in the workforce skewing the numbers of inequality.


http://www.census.gov/prod/2011pubs/acs-16.pdf

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11-02-2014, 08:13 PM
RE: The Benefits of the Fair Tax
(11-02-2014 03:24 PM)frankksj Wrote:  
(11-02-2014 02:16 PM)Cathym112 Wrote:  I've already answered you...a couple of times.... BUT, as I said before....

Bull-shit. This is the first time you tried to address this issue.

Regarding your claim that the gini coefficient "is still the wrong tool to be using to determine income inequality", well it's the tool that the UN, the OECD, and every other organization uses to measure inequality. If you have a better tool, what do you recommend using instead?

Now, as far as your explanation as to WHY the gini coefficient reversed course in 1971, your answer is pretty comical.

(11-02-2014 02:16 PM)Cathym112 Wrote:  there was a change in the co-efficient because prior to 1971, WOMEN weren't in the work force!

I can guarantee you just made that up. I've read a lot on the subject from both the left and right, and this is the first time I've heard anybody say the reason why since 1971 all income has been concentrated at the top is because women entered the workforce precisely in that year. Laughat

[Image: womenwork2.jpg]

This graph displays exactly what I said. Less women were in the workforce prior to 1971.

Notice how between 1940- 1990 the number spikes? That's because between 1960 and 1980 is the year 1970!!!

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11-02-2014, 08:55 PM
RE: The Benefits of the Fair Tax
(11-02-2014 08:08 PM)Cathym112 Wrote:  The paper specifically mentions women in the workforce skewing the numbers of inequality.

I opened that powerpoint you provided. Yes, it shows the gini co-efficient reversed course around 1970. As is often the case, they blame it on Reagan's tax cuts and de-unionization based on their assumption that Reagan had super-human time travel powers and, after making changes in the 1980's, was able to make them take effect a decade earlier. It does NOT back up your claim that the change was caused by women entering the work force.

However, here's the kicker. Who understands a complex system better? The one who can predict and model the outcome in advance? Or the guy who says "Holy shit, why'd that happen?!?" and then tries to kludge together an explanation after the fact?

The fact is that Austrian economists have been saying for a hundred years that printing money, which requires a fiat currency, results in a regressive consumption tax that is born by the poor and middle class because that class gets paid in and saves in currency-denominated instruments, while the rich do not, and the ones that benefit the most are, of course, the private banks which own the central bank and are given the newly printed money. It's so obvious. So simple. So self-evident that when you devalue anything the people who lose are those holding onto that thing that was devalued.

It's so irrefutable that I've yet to see a Keynesian economist even try to dispute this. As shown in your powerpoint, they are NOT even attempting to dispute the Austrians' claim that the trend in inequality was caused by a switch to fiat currency and a government that relies on the Fed to pay its bills. Rather, all you guys do is try to kludge together explanations after the fact, like saying it's because women entered the workforce. If you REALLY understood what was going on, then back around 1970 you would have been warning about it, instead of decades later scratching your head and trying to come up with any explanation but the obvious pink elephant in the room that you don't want to talk about: monetary policy.
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11-02-2014, 09:12 PM
RE: The Benefits of the Fair Tax
(11-02-2014 08:55 PM)frankksj Wrote:  
(11-02-2014 08:08 PM)Cathym112 Wrote:  The paper specifically mentions women in the workforce skewing the numbers of inequality.

I opened that powerpoint you provided. Yes, it shows the gini co-efficient reversed course around 1970. As is often the case, they blame it on Reagan's tax cuts and de-unionization based on their assumption that Reagan had super-human time travel powers and, after making changes in the 1980's, was able to make them take effect a decade earlier. It does NOT back up your claim that the change was caused by women entering the work force.

However, here's the kicker. Who understands a complex system better? The one who can predict and model the outcome in advance? Or the guy who says "Holy shit, why'd that happen?!?" and then tries to kludge together an explanation after the fact?

The fact is that Austrian economists have been saying for a hundred years that printing money, which requires a fiat currency, results in a regressive consumption tax that is born by the poor and middle class because that class gets paid in and saves in currency-denominated instruments, while the rich do not, and the ones that benefit the most are, of course, the private banks which own the central bank and are given the newly printed money. It's so obvious. So simple. So self-evident that when you devalue anything the people who lose are those holding onto that thing that was devalued.

It's so irrefutable that I've yet to see a Keynesian economist even try to dispute this. As shown in your powerpoint, they are NOT even attempting to dispute the Austrians' claim that the trend in inequality was caused by a switch to fiat currency and a government that relies on the Fed to pay its bills. Rather, all you guys do is try to kludge together explanations after the fact, like saying it's because women entered the workforce. If you REALLY understood what was going on, then back around 1970 you would have been warning about it, instead of decades later scratching your head and trying to come up with any explanation but the obvious pink elephant in the room that you don't want to talk about: monetary policy.

Yup. Cuz you resemble anything close to an economist.

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11-02-2014, 09:21 PM (This post was last modified: 11-02-2014 09:26 PM by frankksj.)
RE: The Benefits of the Fair Tax
To anybody interested, the reason Keynesians economists are so loath to discuss monetary policy is because Keynes' theories is built around government spending. "Keynesian economics advocates for the public sector to step in to assist the economy generally" link

Without a fiat currency, the only way for the government get the money to spend money is ultimately through taxation. Voters don't like high taxes, and particularly don't like politicians who raise their taxes to pay for wasteful stuff like wars.

A fiat currency, however, allows the central bank to, effectively, take money from the people, but in a hidden, secret way that the people who are paying the bill don't realize it. They just print however much money they need (now it's all electronic), diluting the value of the money that's already in circulation. The people still pay, of course, but in the subtle form of reduced buying power. Most people don't realize what's happening. They just blame greedy businessmen for raising prices.

So, politicians and pro-big-government-spending economists Heart Heart LOVE Heart Heart their fiat currency because it's a way for them to take all the money they want from the people to spend on whatever they want, without having to actually get the people to hand over the money through taxes. Obviously, if you had a money printing machine in your home, you'd do anything you could to keep it too.

The dirty secret which Keynesians don't like to talk about is that when they do this, the cost is not shared evenly across society. A very small percentage of the rich's income and wealth is in currency, so you can devalue it all you want and it doesn't hurt them so much. However most of what the poor and middle class has is tied to currency, such as salaries and savings. So, when you devalue the currency, it's the poor and middle class who suffer most.

This is why Austrian economists were warning about the effects of the switch to a fiat currency back 40 years ago when Nixon implemented it. Whereas the Keynesians are, decades after the fact, desperate to find ANY alternative explanation for the growing inequality, to never part with their beloved printing press.
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12-02-2014, 09:37 AM
RE: The Benefits of the Fair Tax
It did not escape my notice that Frankksj did not address my comment when he asked me for a better tool to measure income inequality.

I stated, mean-normalized second-order dominance, or Lorenz dominance would be a better tool. Care to weigh in, Frank, with your wikipedia economics?

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12-02-2014, 11:16 AM (This post was last modified: 12-02-2014 11:21 AM by frankksj.)
RE: The Benefits of the Fair Tax
(12-02-2014 09:37 AM)Cathym112 Wrote:  It did not escape my notice that Frankksj did not address my comment when he asked me for a better tool to measure income inequality.

I stated, mean-normalized second-order dominance, or Lorenz dominance would be a better tool. Care to weigh in, Frank, with your wikipedia economics?

Sure. You're in WAAAAY over your head, and making up stuff you don't understand to dance around the stupidity of your earlier claim that income inequality is caused by pesky women entering the workforce. Now you're arguing that the gini coefficient is "the wrong tool" to measure inequality, and the "Lorenz dominance/curve" is a "a better tool".

Uh, hello, Cathy. The Gini co-efficient IS how you track the inequality on the Lorenz Curve. Doh. Even a 10 year old with no economics experience could have figured out that you're full of it because if the Lorenz Curve is how we track inequality, then surely if you google "US Historic Lorenz Curve", you should see some charts showing the change in inequality. But instead, all you see is a static curve. Not one "historic lorenz curve". In fact, even when you google for Lorenz Curve the ONLY historic charts you see are gini coefficients. How can this be that if the Lorenz Curve is a "better tool" to measure changes in equality, the only charts on this subject are gini index???

If you understood what any of this means you'd be blushing right now because the fact is the Lorenz Curve doesn't describe historic inequality, rather it is what's used to calculate the gini coefficient--which IS the primary tool everybody uses to track inequality. Doh.
Here's a full explanation on the Lorenze curve and at the bottom you'll see it says: "The Lorenz Curve has a strict link with a very popular inequality index, the Gini Index", and it links to this which explains that the gini index and says that "This geometrical interpretation based on the Lorenz Curve, however, is only one of the possible methods to calculate the Gini Index." In other words, the Gini co-efficient is the most common way to represent the Lorenz curve, and to plot inequality.

That's why, when looking for historic inequality, you use gini--the Lorenz curve is used to give you the gini.

So, you're statement that the gini coefficient is a horrible tool to measure inequality, and we should be using the Lorenz curve instead, shows that you are hopelessly lost and drowning trying to talk about stuff that is way over head.

The bottom line is the gini index IS the correct tool and it proves unequivocally that Austrian economists understand monetary policy better than Keynesians because the historic gini chart proves beyond any doubt that the moment the US switched to a fiat currency is when inequality changed course--just like the Austrians predicted.
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