conservation of Euros

[Martin Brown]

On 15/05/2010 16:50, John Larkin wrote:

On Sat, 15 May 2010 11:08:13 +0100, Martin Brown
|||newspam|||@nezumi.demon.co.uk> wrote:

On 14/05/2010 21:42, John Larkin wrote:
On Fri, 14 May 2010 17:53:22 +0100, Martin Brown
|||newspam|||@nezumi.demon.co.uk> wrote:

On 14/05/2010 16:06, John Larkin wrote:
On Fri, 14 May 2010 08:31:49 +0100, Martin Brown
|||newspam|||@nezumi.demon.co.uk> wrote:

Engels saw first hand what greedy industrialists were doing to their
workers in the Lancashire cotton industry. Boiler explosions were
commonplace up until the Vulcan insurers made a stand and insisted on
proper boiler safety inspections. And in cases of tampering with safety
relief valves they would not pay out.

[snip]

It makes reasonable sense to pay your workers a living wage for the work
that they do rather than pay them less than they can sensibly live on.
Ford was about the first in the USA to actually do this.

It only makes sense if the money comes from somewhere. If all the
employers arbitrarily doubled wages, inflation would take it all away

We are talking here of industrialised manufacture that was possibly two
or more orders of magnitude more productive. All the profits went to the
mill owners and their workers were left to starve on a subsistance level
of pay because it was marginally better than being out of work.

That effect was transient. The first mill owners could indeed hire
unemployed labor cheap. As other mill owners got into the act, they
had to compete for labor whether they were nice people or not. The

That isn't how it worked at all. There were enough starving people
migrating to the cities that the mill owners could fix the price they
were prepared to pay and anyway preferred to employ children at roughly
1/10 of the adult rate where possible. The working day was unregulated
but typically around 14 hours. A brief history of some of the worst
areas of the country for these practices is online at:

http://www.manchester2002-uk.com/history/victorian/Victorian1.html

The poor were viewed as an underclass to be exploited for commercial
gain like beasts of burden and kept poor. They lived in squalour and
paid barely enough to stay alive. This "transient" situation persisted
until the late 19th century which is how Engles came to observe it.

Yes, that was al the transition period. Before technology caught up
with fertility.

A very long transitional period. It would have remained the status quo
but for the ruling classes running scared of what happened during the
French revolution. In some senses the same landless peasants and urban
poor revolt against rich overlords is playing out today in Bankok.

It seems that the global banking system has major crashes with an almost
predictable period of 80-90 years - 1847, 1929, 2008

The period is getting shorter, and nobody with any sense is doing
anything to lend stability. Quite the opposite.

Germany has just banned trading in "naked short selling" a practice
largely used to drive the share price of sound companies downwards. It
is little more than a form of spread betting on future share price.

In theory I think such transactions are banned in the USA but are not
adequately policed by an SEC more interested in downloading porn videos.

Productivity is the ultimate benevolence. Technology pushes
productivity.

Increased productivity is good, but only when some of the proceeds are
shared with the people who are doing the work.

If workers are massively productive, where is the stuff going to go,
but to the workers? Where else could it go? Why would Henry Ford want
to personally own a million model Ts? Why would Edison want a billion
light bulbs for himself?

Widespread productivity is better than widespread lack of same.

Simple example for the UK was the rest of the empire. The Linen factory
I know most about produced stuff that the workforce would need more than
a years salary to buy. Amusingly it also included fine linen tablecloths
for the White House that were shipped during the American War of
Independence. We know this because the copy invoice survives.

In the Victorian era most
of the mill owners were out to exploit the poor for maximum profit. They
had enough money to buy the capital kit to enter the market and were
determined to keep it that way. The eventual rise of a powerful middle
class of managers and administrators eventually broke the deadlock but
the workers at the bottom of the pile had little option but to form
unions if they were ever to get a fair deal.

All business people want to maximize profit. As productivity and

Timothy 6:10 (King James Version):

For the love of money is the root of all evil: which while some coveted
after, they have erred from the faith, and pierced themselves through
with many sorrows.

There is maximising profit by producing a good product, but there was
also a lot of maximising profits by exploiting the poor and vulnerable
leaving them with a choice of starving to death quickly or more slowly.

Famines usually epitomise this scenario. There is food in warehouses,
but the merchants want a price that is way beyond what any of the
starving people can afford to pay. Ireland was still exporting food
during the infamous potato famine.

competition increase, we go from pre-Victorian poverty to modern
car-in-every-drivway. Nobody guides the process... it has its own
dynamic. There's no credit and no blame; actors act and the system
changes.

That is why the airlines form cartels to keep prices up?

http://www.guardian.co.uk/business/2010/apr/26/ba-virgin-cartel-price-fixing

Left to their own devices industries will shake down to two or three big
players that carve up the market between them and then raise prices. US
anti-trust laws were to prevent this scenario after fo example
Rockefellers Standard Oil company showed how to create and exploit a
monopoly.

For all his vicious business practices he was also quite philanthropic.
And even more so in his long retirement.

Regards,
Martin Brown

 

[Martin Brown]

On 17/05/2010 00:33, JosephKK wrote:

On Fri, 14 May 2010 17:53:22 +0100, Martin Brown
|||newspam|||@nezumi.demon.co.uk> wrote:

On 14/05/2010 16:06, John Larkin wrote:
On Fri, 14 May 2010 08:31:49 +0100, Martin Brown
|||newspam|||@nezumi.demon.co.uk> wrote:

In the UK there were some decent industrialists mostly of quaker
families who did treat their workforce fairly - examples include some
household names like Pilkingtons, Cadbury, Bournville, Marks&Spencer.

A decent industrialist realizes that a partnership with workers is
mutually beneficial, but must still compete with company owners who
don't agree with this philosophy. A company can't arbitrarily give
away high wages without achieving corresponding competitive benefits.

This wasn't about competition though it was about screwing the poor sods
at the bottom of the pile into the ground knowing full well that they
were individually powerless and a consumable item.

Regards,
Martin Brown

You are rather completely bought in to the liberal version of history
based on the content of your post. Look again through the records, your
previous instructors have both understated the worst excesses of the
"owners" and underreported the decency of the average to best cases.

You could not be more wrong. I am working from primary material and
contemporary press reports. I have previously helped National Geographic
in their UK research into relevant local archives. I have access to
private collections of very old photographic material.

You should be aware that the big industrialists were inclined towards
Whig politics (as opposed to Torys who were for the landed gentry). The
modern name for the Whigs is Liberals. A word you cannot bring yourself
to say without the bile and venom dripping from your rabid lips.

If you are actually interested in the history then you could do worse
than read "At the Works" by Lady Bell, wife of one of the Teesside
Ironmasters who founded the British Steel industry.

http://www.amazon.co.uk/At-Works-Study-Manufacturing-Middlesbrough/dp/0860684156

And the founder was actually a Whig (Liberal) politician 1874-1880.

http://en.wikipedia.org/wiki/Lowthian_Bell

They were benign and way ahead of the game in terms of fair treatment of
their own employees in that industry.

BTW old Washington Hall is worth a visit for American tourists who would
like to see something unusual and are in the NE.

I can only comment fully on the ones I have looked at. The large number
of boiler explosions in the Lancashire cotton industry is a matter of
public record and the high density slum grade exploitation of the poor
by many unscrupulous mill owners was a matter of public shame even at
the time. However, the laissez faire view was to leave them to fester.

Regards,
Martin Brown

 

[Martin Brown]

On 17/05/2010 03:05, dagmargoodboat@yahoo.com wrote:

On May 14, 2:31 am, Martin Brown<|||newspam...@nezumi.demon.co.uk
wrote:
On 14/05/2010 06:16, dagmargoodb...@yahoo.com wrote:

Of course Marx himself was a n'er-do-well who never earned his keep,
a pseudo-academic parasite sponging off patron Engels. Engels in turn
coasted off the family business. Marx made his living guilt-tripping
Engels with econobabble, a fine tradition carried on by Marxists
today.

Engels saw first hand what greedy industrialists were doing to their
workers in the Lancashire cotton industry. Boiler explosions were
commonplace up until the Vulcan insurers made a stand and insisted on
proper boiler safety inspections. And in cases of tampering with safety
relief valves they would not pay out.

It was common practice to overstoke the fire before the first shift and
add weight to the pressure relief valve - this resulted in several large
scale boiler explosions destroying big mills in the early morning and
killing many workers in the Lancashire cotton industry.

Destroying your factory is a bad business model. That quickly self-
limits. Besides, nowadays we sue or jail those people. Too much, in
fact.

In a fast moving business scrapping and re-equipping with the latest
technology at no additional cost could actually be a sound business plan
so long as the insurers were prepared to pay out. Vulcan insurance
formed and insisted on boiler inpections to bring this under control.
Factory managers tended to die in explosions but not the mill owners.

http://www.camdenmin.co.uk/technical-steam/historic-steam-boiler-expl...

Articles on the history of boiler insurance show that the US had a worse
record despite having the advantage of seeing the innovations in UK
boilers. Some element of NIH played a part but mostly it was that
industrialists greed was paramount and the workers powerless. eg.

http://www.casact.org/pubs/proceed/proceed15/15407.pdf
first page and page 7 under Normal Loss Hazard

Interestingly and ironically enough, that emphasizes the need to
identify defects and eliminate high risk insureds to minimize
underwriting loss rates.

"Experience has also shown that the scientific examination and
inspection of insured boilers produces a
declining loss ratio."

It also showed that US industrialists were a lot more cavalier about
boiler explosions despite having the opportunity to learn from UK
experience.

In the UK there were some decent industrialists mostly of quaker
families who did treat their workforce fairly - examples include some
household names like Pilkingtons, Cadbury, Bournville, Marks&Spencer.

But most of the rest were complete bastards who built large factories
and employed the equivalent of bonded labour stuck very high density
slum housing. It was not surprising that unions were formed in some
cases the manager really did hold the whip hand - literally.

As John pointed out, that was a transient effect, an unusual, historic
dislocation. Machines meant that few could farm what had previously
required the toil of many. So there were lots of workers looking for
work.

Short term, that's painful. Long term, that's creative destruction,
society re-allocating resources from something no longer needed, to
something people do want and need.

And so long as it only affects the peons that is OK?

Would it have been better to destroy the farm equipment that made
growing food so easy, or the mills that made clothing cheap for
everyone? Or go the Obama way--carve up the factory and give it to
the workers? Divvy up the greedy farmer's land? That makes factories
disappear and farms go fallow (witness Zimbabwe).

You set a false dichotomy. What I am saying is that the ruthless
exploitation of the poor at below subsistence living rates was something
that they had to fight against and as such the formation of unions or
militias was inevitable. In France it led to a wholesale revolution with
mass slaughter of the gentry and ruling classes.

The Chartists looked at one point like they might do the same thing in
the UK - that was at least the fear of the establishment.

The dislocation at the beginning of the Industrial Revolution was
especially traumatic since motive power meant so many human-muscle-
powered occupations were displaced at the same time. Would it have
been better to keep them all in subsidized green jobs making wagon
wheels with sustainable, carbon-neutral technology, as they were,
after all, before steam?

It wasn't carbon neutral before steam. Small amounts of coal were in use
in the UK from about 1200 onwards. Coal only became really important
after the 1615 Royal Proclamation forbidding the use of wood for glass
making and so spurring on the industrial revolution. The remaining wood
was needed for shipbuilding. Trees were vanishing fast.

But coal really only took off big time after Abraham Darby in
Coalbrookedale patented a means to smelt iron ore by using coke around
1709. That is still a long time before the Victorian era.

Longer term, profitable business attracts competition. Outrageous
profits are almost never sustainable for that reason. Competitors
have to compete for workers, with both wages and conditions.

No they don't. Look at Standard Oil in your own country - it required
government legislation to bring their monopolistic empire under control.
They can agree not to outbid each other and keep wages low.

Sharing the wealth? That comes immediately through cheaper goods,
making it easier and cheaper to live, and through better wages and
working conditions with time, as described above.

Everyone wins. And yes, the industrialist does very well for a time--
there's a phase delay. That's his reward. Take it away, and he won't
do it at all.

You subscribe to a model that says that the rich will only work if you
shower them with loadsamoney because that is what they crave. But the
poorest work best when starving and under constant threat of eviction.

It is no coincidence that the worlds most violent societies have the
largest ratio between highest paid executives and minimum wage.

Regards,
Martin Brown

 

[Bill Sloman]

On May 19, 12:37 am, dagmargoodb...@yahoo.com wrote:

On May 18, 12:53 pm, Joerg <inva...@invalid.invalid> wrote:

dagmargoodb...@yahoo.com wrote:
On May 17, 8:43 pm, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 17, 3:31 pm, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:

<snip>

b) As I laid out for Keith, once you remove all those expenses from
the manufacturers' cost, prices will fall.  Not instantly, but
quickly.  You may not think they'll fall enough, but they will fall at
least some, offsetting the effect you fear.

Nonsense. Give retailers a chance to raise their prics or up their
profit margins, and they grasp it with both hands. I've lived through
a couple of currency reforms - in Australia (the introduction of the
Australian dollar) and in the Netherlands (the introduction of the
euro) and was close enough to the UK to be aware of how the
decimalisation of the UK pound worked out, and in every case the
effect was to create a small spurt of inflation. The prices never did
come back down. The introduction of your "Fair Tax" would have the
same effect - prices would never fall.

<snip>

Lots of people are hoping that the worst will be stopped after the
November elections. In fact, I have met people who said they'd make some
major business decisions based on the outcome.

I spoke at length to a business owner today.  He's got a nice shop
with a fun crew, and he's disgusted.(*)  A fun, fine, compassionate,
caring man, who's just finally gotten tired of all the Slomans heaping
their mandates on him, for nothing.

There are no socialists in power in the USA - not even of my moderate
disposition. The rules and restrictions that your friend has to live
with come from your own political establishment. They aren't well-
thought out, in part because your legislators haven't clue about how
things are done in other parts of the world, and perennially re-invent
poor substitutes for the wheel, in the same way that your Fair Tax
proposals ignore the advantages of VAT, because it's never been
implemented in God's only country.

 But he's fine, he made his money
long ago, and he doesn't need the hassle.  So he's quitting, closing
shop.  Chalk up a few more jobs created or saved, Mr. Obama.

I somehow doubt that Obama has passed enough legislation yet to have
any signifcant effect on your friend's situation. He will have been
thinking about quitting for some time now, and his decision will have
more to do with the idiocies already perpetuated under the recent
Republican administration.

Of course, granting your bizarre Obama-phobia, he may have pandered to
your prejudices by claiming to be anxious about his prospects under
the new administration. He did manage to sell you some of his 1"
plate, even if he wasn't able to unload the big iron mill, so the
flattery worked to some extent.

--
Bill Sloman, Nijmegen

 

[Joerg]

Jamie wrote:

Joerg wrote:

Bill Sloman wrote:

On May 18, 5:21 pm, Joerg <inva...@invalid.invalid> wrote:

Bill Slomanwrote:

On May 17, 4:01 pm, Joerg <inva...@invalid.invalid> wrote:

Bill Slomanwrote:

On May 16, 1:11 am, Joerg <inva...@invalid.invalid> wrote:

[...]

Be that as it may, the Greeks have run out of options, and they will
do what every other government has done when they fall into the
hands
of the IMF, which is to follow the - stupid - prescriptions.

Obviously that will be much better than what they did so far, and
what
got them into this mess in the first place.

Obviously. But it's applying bang-bang control where proportional,
integral and derivative control would let the economy transiton to the
desired state rather faster. Because the IMF is run by American
educated monetarist economists, whose "economic science" has very
limited predictive power, they haven't a hope of implementing any kind
of feed-forward control strategy.

There comes a time when bang is needed, not bang-bang. Meaning someone
has to hit the emergency stop button because the system that was
entrusted with running the place has gone out of control. Just like you
don't keep pulling the yoke on an aircraft to maintain altitude when
the
stall horn is blaring because that would end in a fiery crash. You have
to prepare everyone for an "off field landing" and then land as soon as
possible.


Stall recovery is famously conter-intuitive. When I was a kid and
interested in aircraft, I got to read the account of the first guy who
worked out how to get out of a stall, and proceeded to get into an
aircraft, take off and test his hypothesis - putting his neck on the
line in the process.

The non-linear mechanisms involved don't have obvious analogies with
the Greek situation - all the control mechanisms were available and
working as expected, but the Greek government seems to have ingored
the fact that they were steadily losing height.


I think they are really close to a flat spin. Maybe they can recover
if they ditch all that socialist money squandering. If they don't then
they will not recover.

Oh, like us (US), you mean?

Most recently we aren't much better. And in some states like California
the left has has really doomed any future budget by outright stupid
decisions. However, in contrast to other regions of the world we do have
a well-oiled high-tech machinery out here, tons of sales, new inventions
every day. That is sorely lacking elsewhere. One can't live high on the
hog with tourism being just about the only sizeable source on revenue.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Joerg]

Bill Sloman wrote:

On May 18, 5:19 pm, John Larkin
jjlar...@highNOTlandTHIStechnologyPART.com> wrote:
On Tue, 18 May 2010 01:20:40 -0700 (PDT),Bill Sloman

bill.slo...@ieee.org> wrote:

[...]

The alternative do-nothing approach, as practiced by Hoover in 1929,
leads to vast tracts of industry standing idle with 25% unemployment,
dramatically reducing production and consumption.
The argument isn't about "producing as much as you consume" - it's
about maintaining consumption and production under circumstances where
both would otherwise collapse.
Managing the transition back to balanced budgets without crimping the
level of economic activity too much isn't a trivial job, and the banks
don't help by bleating about financial responsiblity as if their US
colleagues hadn't created the problem in the first place by being
totally irresponsible.
With your understanding of dynamics, it's a good thing you don't
design electronics.

With your understanding of dynamics, it is a miracle that you can.

As you should know, I can use the Ziegler-Nichols step response test
to tune a PID controller. This is tolerably primitive (Ziegler and
Nichols published their test in 1942, the year I was born) but
adequate in a lot of practical situations. I know about more
sophisticated schemes - such as state variable control - but happily
I've yet to run into a situation where I needed to use one. And my
Ph.D. thesis was on the reaction dynamics of the thermal decompostion
of nitrosyl bromide, which involved simulating a non-linear process (a
second order rate law, perturbed by self-cooling). Your own background
is probably less sophisticated.

Here goes the bragging again.

How come that John, probably not that much different in age from you,
makes tons of money designing and building electronics, right now, has
created tons of jobs, and you don't? To me, whether someone has a Ph.D.
is rather irrelevant. What he or she does, that's relevant.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Joerg]

dagmargoodboat@yahoo.com wrote:

On May 18, 12:53 pm, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 17, 8:43 pm, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 17, 3:31 pm, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
[...]
That is, if your laborer has to pay income tax, you have to pay him
more to compensate, and you have to raise your sales prices to recover
that loss from your customers.
c) So, when you buy an item, you *are* paying all the taxes of all the
people and entities that made the item.
Make sense so far?
d) Under the Fair Tax, with all those embedded taxes eliminated, the
manufacturer would now be able to make the same profit selling his $1
item for $0.77, which would be the new price.
e) At checkout, your (formerly) $1 item would now appear on the sales
ticket as
1) price = $0.77, plus
2) $0.23 in Fair Tax, collected at point-of-sale to pay all the
taxes of all the people who made the thing.
Total = $1.00, just like before. No difference.
There, I think that's basically their pitch. I'm not a Fair Tax
expert, so I could've biffed something.
Ahm, major bug in the calcs:
The price of a piece of merchandise does _not_ consist of lots of labor.
If MLO (materials+labor+overhead) is anywhere north of 30% on a mass
product then it is already doomed.
That's an average. The Fair Tax economists worked from gross averages
applied across all of society; services are nearly 100% labor, mass-
produced Joerg-designed items not so much.
I'd have to see their math. Most of what we buy is not services but
cars, TV set, washing machines, lumber, groceries, beer and so on. Labor
is a small fraction of the cost in these products. Say it was 10%, then
this whole "fair tax" of 23% would turn into a de facto 20% ripoff for
all those folks in or close to retirement who have diligently saved.
Because those savings are from income that has already been taxed.
Nothing fair about that at all.
Even in high-tech medical devices labor wasn't a whole lot, and there I
speak from experience because I ran a division including production.
Health care costs would instantly shoot up if they did that extra sales
tax. On top of the tax increases we just got in that domain. We have to
think about those consequences.
I can't speak to their methods or calculations, but I'd sure love it
if you'd read their material and report back on it! ...
This one?
http://www.fairtax.org/site/PageServer
This document gives figures, but not methods:
http://www.fairtax.org/site/DocServer/What_the_federal_tax_system_is_...
This is the main info page:
http://www.fairtax.org/site/PageServer?pagename=about_main
I had looked at both. No meat in there other than assumptions.

You sure give up awfully easily Joerg! There's a load of academic
papers, cited in the footnotes, with 10 full .PDFs for free download.
Like this one:
http://www.fairtax.org/PDF/Tax%20Notes%20article%20on%20FT%20rate.pdf
(footnote #1 on http://www.fairtax.org/site/PageServer?pagename=about_basics_main
)

Yes, sometimes when you find blatant flaws you need to scrap and
abandon, then if suitable redesign. Like this one in the article from
your above link, quote: "1. Housing. Explicit rental payments are
subject to taxation under the FairTax. Implicit rents on existing
owneroccupied housing and farms are not. However, the Fair-Tax
implicitly taxes imputed rent on newly constructed housing via a
prepayment approach that levies the FairTax on their initial sale.4
Thus, we remove the value of imputed rent for housing and farm dwellings
from the base. Because purchases of new homes are counted as investment
in new structures in the NIPA accounts, we add those figures to the base"

a. Here they are beginning to make this sort of tax as complicated as
the income tax. Engineers call that feature creep. Expempt this, but not
that, but only on days with a full moon ...

b. They punish elderly who have saved and want to move into assisted
living but with some independence. If the buildings are new their cost
jumps 23%. So the building of new retirement communities will come to a
crawl. Some people will move out of the country and buy a retirement
bungalow there to avoid this double-tax whammy. -> More layoffs.

c. They exempt imputed rent on old buildings yet do not at all consider
removing the de-facto double tax on savings in Roth IRAs or regular
accounts. What that does is simple: The millisecond such a flawed law
would be announced there'd be a stampede. Everybody who is smart pulls
their money out of the banks and buys real estate, any real estate. ->
Financial market collapse -> major new recession.

And then they talk about removing compliance costs which is also flawed.
Who is going to determine how much fictitious rent tax you must
surrender? Right, an assessor. He's going to have to be paid a salary,
and he'll probably get a nice fat pension later.

Long story short I do not wish to pay a ficticious rent tax if I buy a
retirement home with my _already_ _taxed_ money just because it was
build after the year xxxx. While the guy who lucked out and found an
older one pays nothing.

BTW, in Europe they already see such effects. Engineers are livid about
the fact that they are often socked with a VAT on fictitious shipping
charges from US parts distributors who offer free shipping above a
certain purchase amount. Needless to say, as usual such charges are
estimated on the high side.

There's too much, really, and kind of scattered across white
papers, .PDFs, and FAQs.
About the FairTax-->Basics has some numbers:
http://www.fairtax.org/site/PageServer?pagename=about_basics_main
Major mistake, and that's a big one, quote: "Consumption increases by
2.4 percent more in the first year, ..."

What were they smoking?

Just a small hint: Joe Q.Public does not pay 23% income tax on _100%_ of
his salary, in fact many people pay hardly anything. Those folks'
consumption will drop 23%, plain and simple. Then, there will be massive
layoffs.

Joe. Q. Public *does* pay at least 14% SS tax, plus others, so at the
very worst it's not as bad as you say.

He doesn't. Half is paid by the employer. And the notion that that part
will be removed from COGS is moot because, as we all know, the bulk of
our merchandise is imported.

Further, Joe Q. will be getting a "prebate" check in the mail, further
reducing his tax, and the harmful impact you project.

Yeah, a family of four gets $6,205. So how much does a retired couple
get? $3000? That's a joke.

Those factors take most, if not nearly all the wind out of that
concern's sails.

It does _nothing_ about the fact that savings will effectively be
double-taxed. Unless maybe you convert all into holdings of older real
estate. Which people are probably going to do then. Ah, I see the next
housing bubble coming

I can only see lots of text, no hard math.

Lots of equations in the one .PDF I just linked. That's the kind of
documentation I remembered seeing before.

But the numbers don't add up IMHO. Not at all in a fair way, that is.

I haven't read thru all their papers--there are so many. I remember
hitting a couple that looked well-considered, but I was really just
skimming.
I don't find it well-considered at all.

Some of the more serious bugs in here, for example ...

http://www.fairtax.org/PDF/MacroeconomicAnalysisofFairTax.pdf

include quote "The specific taxes repealed include ... Social Security
and Medicare taxes". Now I am certainly against the extremely plum
public employee pensions that are wrecking California. But on the same
token it isn't fair that a teacher who used to not pay SS taxes but also
doesn't get SS pays into the system for me. Because that's what he'd do
if he buys a beer.

You're trying to make SS fair? Man have you got a project!

What's fair about the worlds's biggest Ponzi scheme--giving the first
investors outrageous returns, paid by later investors, with the
promise that even later investors will pay even more, ad infinitum,
all under force of law?

Such a VAT tax system reverses it, it rewards people who tend to
squander and punishes those who save.

The paper also lacks a crucial consideration, the one I mentioned: It
socks it to retirees who have diligently saved every penny they could.
Now that already taxed money would get taxed again the millisecond they
buy something. This is not fair and I sure hope some organizations like
AARP will see that unfair punishment and hold the line, and not let that
happen.

a) It doesn't tax savings any more than they'll be taxed anyhow. When
Mr. Obama jacks up taxes (as he's already massively done by spending,
and will soon do by hook or by crook), do you honestly think that cost
to companies and workers won't be reflected in higher prices for you?
That you won't, ultimately, be paying your taxes and everyone else's
too every time you buy anything? You will.

Yeah, but I won't pay it twice.

b) As I laid out for Keith, once you remove all those expenses from
the manufacturers' cost, prices will fall. Not instantly, but
quickly. You may not think they'll fall enough, but they will fall at
least some, offsetting the effect you fear.

No. Been to Walmart lately? Check where stuff majorly comes from. Yep,
China.

snip


Besides, I don't like having my money at the whim of Congress. They
burned me ex post facto with my 401k, charging me a penalty for doing
something that was allowed when I did it, then changing the law
retroactively months later.
You couldn't sue?
Nope. You can't sue Congress. Sovereign immunity. (Impunity,
really.)
If a law is deemed unfair it can be challenged in court. Not Congress,
but the law. Slamming people retroactively sure sounds unfair to me (and
probably to a judge or jury).
It *is* unfair--even unconstitutional[*]--but there's Supreme Court
precedent for it.
[*] "No Bill of Attainder or ex post facto law shall be passed" --US
Constitution, Art. I, Sec. 9.
I've cribbed this from an earlier post, Nov. 22, 2009:
http://groups.google.com/group/sci.electronics.design/browse_frm/thre...
In United States v. Darusmont, 449 U.S. 292 (1981)
http://supreme.justia.com/us/449/292/case.html
a couple sold their house (a triplex)--to relocate for a new job--
after carefully consulting with their tax guys to sell in a way
minimizing their tax. Congress changed the law later that year, and
then IRS came after the couple for more tax.
The homeowners argued that tax change was a violation of their due
process rights under the 5th Amendment; the justices said no, because
the issue had been under discussion in Congress for a year prior, so
the
homeowners *should've* known. Further, the Court said changing the
tax rate of an existing law was not the same as enacting a new /ex
post facto/ law.
If done retroactively it is ex post facto. The constituioon does not say
new. Otherwise it would also be ok to set the income tax to 110%
retroactively, wouldn't it?

You Sir, are exactly right. That's the problem with a "living and
breathing" Constitution. "Living and breathing" really means "it says
whatever [the current regime] wants it to say", flipping it upside
down if necessary..

The 2nd problem is that people don't appreciate the timelessness of
the core of its design. It's a control system, a brilliant one, but
even brilliant control systems quit working if you start twiddling the
feedbacks and jumpering around the safeties. The salesmen are
monkeying with the hardware.

Yes, they are indeed :-(

This started under Franklin Delano Obama. He's back, so beware.
Everything's fair once you stop following the Constitution.
"No man's life, liberty, or property are safe while the Legislature is
in session."
--Judge Gideon J. Tucker (1826-1899)
Lots of people are hoping that the worst will be stopped after the
November elections. In fact, I have met people who said they'd make some
major business decisions based on the outcome.

I spoke at length to a business owner today. He's got a nice shop
with a fun crew, and he's disgusted.(*) A fun, fine, compassionate,
caring man, who's just finally gotten tired of all the Slomans heaping
their mandates on him, for nothing. But he's fine, he made his money
long ago, and he doesn't need the hassle. So he's quitting, closing
shop. Chalk up a few more jobs created or saved, Mr. Obama.

(*But he sold me a load of 1" plate, cheap, and offered me a BIG IRON
American mill for peanuts. (I'd be tempted, but I think it'd punch a
hole in my slab!)

You garage should have slab that can hold a fully loaded Chevy Suburban.
Is it heavier than that? Of course, SWMBO might have a different take on
reducing garage capacity that way

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Joerg]

krw@att.bizzzzzzzzzzzz wrote:

On Tue, 18 May 2010 11:42:26 -0700, Joerg <invalid@invalid.invalid> wrote:

krw@att.bizzzzzzzzzzzz wrote:
On Mon, 17 May 2010 14:31:43 -0700 (PDT), dagmargoodboat@yahoo.com wrote:

On May 17, 4:05 pm, "keith...@gmail.com" <keith...@gmail.com> wrote:
On May 17, 3:53 pm, dagmargoodb...@yahoo.com wrote:



On May 17, 3:41 pm, "keith...@gmail.com" <keith...@gmail.com> wrote:
[...]

Again, you're missing the point. With after-tax savings you're
*already* paying that tax. If the "Fair Tax" is implemented you get
to pay the "consumption tax" on the *AFTER-TAX* money.
I'm not missing the point, I just think you're mathematically wrong.
If the thing costs $1 today, or $0.77 plus $0.23 Fair Tax tomorrow,
what have you lost? Where have I gone wrong?
Because it cost me $1.40 yesterday (when I earned it) to have the
$1.00 today,
If you paid taxes already under the old system then you were screwed
*yesterday*. That can't be fixed-it's gone. Sorry. Me too.
No, I was playing the game by the rules yesterday. Today the government
change the rules after the game was in play. The winner is the one who spent
every dime he ever made, not the one who took care of his life.

Many of the ones who took care of their life will then move, to some
places outside the US, and escape such confiscatory "fair tax" should it
ever happen. Who knows, Baja, NZ, some island ... because then the
problem simply goes away. The consequences? Even more layoffs here.

That's fine if they don't want to take their money with them. They've already
plugged that hole.

Huh? It's just one big wire transfer.

and tomorrow (after I retire, take it out of the bank,
and spend it) it only buys $.77 worth of stuff.
$1 only buys $0.77 worth of _stuff_ today, say the Fair Tax people
(AIUI). The rest goes to taxes hidden in the item's price.
Fine, if it really works, but that was not my point.

It doesn't work.

Other than ruining people's lives who have played by the rules (the life's
savings part we are objecting to here), I think it might have legs.

I think it's a non-starter and sure hope it stays that way. At least for
the next 40-50 years

If I tax-deferred the
$1.40, I could buy $1.00 worth of stuff. Any after-tax savings (that
is socked away before the change) gets hammered *twice*.
If you had tax-deferred the $1.40, you'd escape the indignities of the
old system. That's a windfall (assuming Congress allows it).
If they don't, I'll yank it all out and spend it. I may do that anyway.
Property looks like the only thing worth having.

Sure does. I am thinking about the same. But how do you avoid the
hassles of being a landlord yet not pay humongous amounts to some
property management place?

Not rent to people? Dunno. Forty years ago land was put in "the bank" by
making drive-in theaters. They paid for themselves and the taxes until the
land became incredibly valuable. Twenty years ago it was golf courses. Next?

"Next", that's just the problem. Yesterday I heard another of the
countless stories where renters had totally trashed a nice home. Fixing
it back up will likely cost all the collected rent income (before they
stopped paying), and then some.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Joerg]

dagmargoodboat@yahoo.com wrote:

On May 18, 2:46 pm, Charlie E. <edmond...@ieee.org> wrote:
On Mon, 17 May 2010 14:31:43 -0700 (PDT), dagmargoodb...@yahoo.com
wrote:
major snippage and attributions...

$1 only buys $0.77 worth of _stuff_ today, say the Fair Tax people
(AIUI). The rest goes to taxes hidden in the item's price.
If I tax-deferred the
$1.40, I could buy $1.00 worth of stuff. Any after-tax savings (that
is socked away before the change) gets hammered *twice*.
If you had tax-deferred the $1.40, you'd escape the indignities of the
old system. That's a windfall (assuming Congress allows it).
Going forward though, with income-taxed money, the $1 we have left
still buys the same with or without the Fair Tax. $1 with embedded
tax burden hidden inside it, or ($0.77 actual price + $0.23 Fair Tax)
both cost you $1 at the register. No loss of purchasing power.
That's the contention, AIUI.
The other false assumption is that the price would drop
instantaneously to $.77 as soon as the tax was passed.

I don't assume that. There are all sorts of 2nd and 3rd-order
effects.

In reality,
the price stays at $1.00, and the retailer uses this 'profit' to pay
off his loans. Now, as time goes by, prices 'might' drop, but I
wouldn't bet on it. I actually expect prices to rise.

I expect prices to fall, quickly. Like with gasoline there's a delay
for goods-in-transit, then market forces handle the rest.

Why would a Japanese car or Chinese-made flatscreen TV fall in price
quickly?

If the
government stops taking out SS and IRS taxes from my paycheck, I have
more to spend. I can then afford these now 'higher' prices of that
$1, plus $.23 fair tax, plus the sales tax of $.09, so it is now
$1.33.

As for savings, I don't sweat it as much. Yes, it makes my post-taxes
savings less valuable, but it also removes a lot of taxes on my
earnings and interest!

I'm interested in saving the time and energy I waste avoiding tax land-
mines. That's worth a lot--at least a couple weeks a year. More like
three, methinks.

There'll be new tax land-mines, like who gets to pay ficticious rent
tax, how much, and who doesn't. Et cetera.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[John Larkin]

On Tue, 18 May 2010 15:54:36 -0700 (PDT), Bill Sloman
<bill.sloman@ieee.org> wrote:

On May 18, 5:19 pm, John Larkin
jjlar...@highNOTlandTHIStechnologyPART.com> wrote:
On Tue, 18 May 2010 01:20:40 -0700 (PDT),Bill Sloman

bill.slo...@ieee.org> wrote:
On May 17, 5:18 pm, John Larkin
jjlar...@highNOTlandTHIStechnologyPART.com> wrote:
On Mon, 17 May 2010 07:01:48 -0700, Joerg <inva...@invalid.invalid
wrote:

Bill Slomanwrote:
On May 16, 1:11 am, Joerg <inva...@invalid.invalid> wrote:
Bill Slomanwrote:
On May 13, 5:59 pm, Joerg <inva...@invalid.invalid> wrote:
Bill Slomanwrote:
On May 13, 3:46 pm, John Larkin
jjlar...@highNOTlandTHIStechnologyPART.com> wrote:
On Thu, 13 May 2010 02:34:35 -0700 (PDT),Bill Sloman
bill.slo...@ieee.org> wrote:
On May 12, 7:57 pm, John Larkin
jjlar...@highNOTlandTHIStechnologyPART.com> wrote:
On Wed, 12 May 2010 10:13:56 -0700 (PDT),Bill Sloman
bill.slo...@ieee.org> wrote:
I don't harvest; I think.
An unconvincing claim. Your "thinking" reflects your indolent habit of
picking up predigested  nonsense that fits your fat-headed
preconceptions.
I've been calling you a fathead for years. You can't even design
original insults.
In this thread you've claimed that the euro can't be stable currency
because it shared across several countries with different economic
strengths and weaknessess, while failing to note that the US dollar is
shared across the united states of America - running from Alaska to
Wyoming (neither of whose economies look much like California's).
But we only have one government.
Your states don't have legislatures and governors?
They aren't allowed to print money or regulate big financial
institutions. Most must balance their budgets. The trouble that
California is in now will be fixed by California. The trouble that
Greece is in now will be fixed by Germany.
Do pay attention. The trouble that Greece is now in will be fixed by
Greece. The EU - as a whole - will under-write Greek borrowing until
that happens. The Germans have had quite a lot of influence on the
requirements imposed on the Greeks in return for the guarantees, but
the Greeks have to do the work.
Do pay attention:
http://www.europeanvoice.com/article/2010/05/german-parliament-clears...
Quote: "Members of the Bundestag, Germany's lower house, approved a
state-backed guarantee for the loan ..."
It's you who needs to pay attention. The EU - as a whole - is under-
writing the Greek borrowing. The individual memebers of the EU have to
pass legislation to approve their particular country's part of the
package. The Dutch lower house approved the Dutch component recently.
It's still a collective decision.
So, what exactly does "state-backed" mean in your opinion?

That the individual states guarantee that their particular portion of
the loan will be paid by that particular loan if Greece goes bankrupt?
What else would it mean?

Ah, now you are beginning to get it. You wrote above, quote "The EU - as
a whole - is underwriting the Greek borrowing". Which is wrong. For
example if Greece fails to service the debt it now has in Germany the EU
won't pay the Germans back. Their own taxpayers will. And those are
rather pissed right now and for good reason.

Your notion that "The trouble that Greece is now in will be fixed by
Greece" will IMHO not come to pass.

You are making a prediction, based on the little you know about the
situation, heavily influenced by what you've read in the US mass
media. As opinions go, it doesn't carry a lot of weight.

Check the facts. Greece has no industry to write home about, tourism is
declining because countries like Turkey are cheaper, and they can't
print Euros. Did I forget anything? Guess not.

They are unlikely to be able to fix the
damage that living beyond their means for years has done.

Why? The US - which has been running a hugge balance of payemnts
deficit since Regan was president - would suggest that you might be
right, but the money market hasn't yet got around to labelling US
treasury bonds as risky investments.

We have an industry. Greece doesn't. HUGE difference. Open your PC or
whatever else electronic and see how many components in there are from
Greek companies. Open the hood of your car and do same. In fact, open
just about anything.

The Greek credit rating has now gone through the floor, and they've
got no option but reform.

But torching the bank buildings isn't going to achieve that.

Their option is to carry on as before, and let the Germans pay for
this round. Reform after this shot of money runs out, and party for a
few more years.

That's not an option. The EU support ws condtional on painful and
immediate reform, and if the Greek goverment doesn't deliver on that,
the support goes away.

It's other European countries who will fix it, also countries
overseas such as the US (via IMF).

The IMF has a one-size-fits all solution for every country that gets
into serious debt. It does seem to be based on the prescriptions of a
group of particularly unrealistic US economic theorists, and tends to
do serious damage to the real economy in the process of restoring the
credit rating, but international credit rating never did have much to
do with reality, as we got to see when the sub-prime mortgage crisi
hit the fan.

And your alternative would be?

Be that as it may, the Greeks have run out of options, and they will
do what every other government has done when they fall into the hands
of the IMF, which is to follow the - stupid - prescriptions.

Obviously that will be much better than what they did so far, and what
got them into this mess in the first place.

Sloman doesn't approve of stupid prescriptions, like producing as much
as you consume.

http://apnews.myway.com/article/20100517/D9FOHKGO0.html

Although the article doesn't make this explicit, its all about the
economics of "pump-priming" stimulation of the economy, to compensate
for the damage done by the collapse of the US housing price bubble,
which had conjured up an immense amount of credit out of thin air.

National governments have had to conjure up comparable amounts of
credit by deficit financing to keep the economy running at a
respectable fraction of its potential productivity.

The Greeks didn't lack credit. They lacked productivity. Credit just
let them party hearty and run up debt, with the French and the Germans
picking up the tab. Thay won't be able to repay the assistance unless
they get to work.

(Hint hint)

Your "expert" opinion of the Greek economy seems to have missed the
point that they own and run more ships than any other country. This
isn't a form of productivity that either you or Joerg seem to know
much about, and it does make the point that Greece is a real country
with real means of making money. Their goverment has been making a
mess of running the economy for quite some time now - the Greek
military junta that ran the country from 1967 to 1974 didn't leave the
economy in a well-organised state, and political passion has stood in
the way of rational government - but the current crisis does seem to
have finally been sufficiently dramatic to command concentrated
atention.

The alternative do-nothing approach, as practiced by Hoover in 1929,
leads to vast tracts of industry standing idle with 25% unemployment,
dramatically reducing production and consumption.

The argument isn't about "producing as much as you consume" - it's
about maintaining consumption and production under circumstances where
both would otherwise collapse.

Managing the transition back to balanced budgets without crimping the
level of economic activity too much isn't a trivial job, and the banks
don't help by bleating about financial responsiblity as if their US
colleagues hadn't created the problem in the first place by being
totally irresponsible.

With your understanding of dynamics, it's a good thing you don't
design electronics.

With your understanding of dynamics, it is a miracle that you can.

As you should know, I can use the Ziegler-Nichols step response test
to tune a PID controller. This is tolerably primitive (Ziegler and
Nichols published their test in 1942, the year I was born) but
adequate in a lot of practical situations. I know about more
sophisticated schemes - such as state variable control - but happily
I've yet to run into a situation where I needed to use one. And my
Ph.D. thesis was on the reaction dynamics of the thermal decompostion
of nitrosyl bromide, which involved simulating a non-linear process (a
second order rate law, perturbed by self-cooling). Your own background
is probably less sophisticated.

The first control system I ever designed, at about the age of 19, was
for a 32,000 horsepower steamship propulsion system. The system
nonlinearities, propeller/hull bahavior, and the boiler dynamics had
to be considered. I simulated it in FOCAL on a PDP-8. A sub-loop drove
a dc servo motor/pot that positioned the steam valve, which was in
turn moved by a hydraulic servo. It all worked first try.

While I was tuning the first system, on a new LASH ship tied up at
Avondale shipyards on the Mississippi, I turned one trimpot too far
and *almost* ripped the ship off the dock, which could well have
killed a couple of shipyard workers but would certainly have attracted
notice anyhow.

The stuff I do isn't academic. And I still do it.

John

 

[John Larkin]

On Wed, 19 May 2010 06:43:28 -0700, Joerg <invalid@invalid.invalid>
wrote:

Bill Sloman wrote:
On May 18, 5:19 pm, John Larkin
jjlar...@highNOTlandTHIStechnologyPART.com> wrote:
On Tue, 18 May 2010 01:20:40 -0700 (PDT),Bill Sloman

bill.slo...@ieee.org> wrote:

[...]

The alternative do-nothing approach, as practiced by Hoover in 1929,
leads to vast tracts of industry standing idle with 25% unemployment,
dramatically reducing production and consumption.
The argument isn't about "producing as much as you consume" - it's
about maintaining consumption and production under circumstances where
both would otherwise collapse.
Managing the transition back to balanced budgets without crimping the
level of economic activity too much isn't a trivial job, and the banks
don't help by bleating about financial responsiblity as if their US
colleagues hadn't created the problem in the first place by being
totally irresponsible.
With your understanding of dynamics, it's a good thing you don't
design electronics.

With your understanding of dynamics, it is a miracle that you can.

As you should know, I can use the Ziegler-Nichols step response test
to tune a PID controller. This is tolerably primitive (Ziegler and
Nichols published their test in 1942, the year I was born) but
adequate in a lot of practical situations. I know about more
sophisticated schemes - such as state variable control - but happily
I've yet to run into a situation where I needed to use one. And my
Ph.D. thesis was on the reaction dynamics of the thermal decompostion
of nitrosyl bromide, which involved simulating a non-linear process (a
second order rate law, perturbed by self-cooling). Your own background
is probably less sophisticated.


Here goes the bragging again.

How come that John, probably not that much different in age from you,
makes tons of money designing and building electronics, right now, has
created tons of jobs, and you don't? To me, whether someone has a Ph.D.
is rather irrelevant. What he or she does, that's relevant.

I probably make about what any senior engineer or engineering manager
makes; it's all I need. But I bet I have more fun than average.

Engineeering can be a great source of amusement. Given that, the money
doesn't much matter.

John

 

[John Larkin]

On Tue, 18 May 2010 15:21:19 -0700 (PDT), Bill Sloman
<bill.sloman@ieee.org> wrote:

On May 18, 5:35 pm, John Larkin
jjlar...@highNOTlandTHIStechnologyPART.com> wrote:
On Tue, 18 May 2010 01:47:19 -0700 (PDT),Bill Sloman

bill.slo...@ieee.org> wrote:
On May 17, 7:10 pm, John Larkin
jjlar...@highNOTlandTHIStechnologyPART.com> wrote:
On Mon, 17 May 2010 03:40:11 -0700 (PDT),Bill Sloman

bill.slo...@ieee.org> wrote:
On May 17, 4:22 am, dagmargoodb...@yahoo.com wrote:
On May 14, 5:07 pm,Bill Sloman<bill.slo...@ieee.org> wrote:

On May 14, 10:42 pm, John Larkin
Productivity is the ultimate benevolence. Technology pushes
productivity.

Perfectly true. But it doesn't do a thing to ensure that the benefits
of increased productivity are equally shared between capital and
labour.

Obviously it's extremely critical how and when those benefits are
shared.  Labor does not deserve all the proceeds of my innovation,
risk, and investment simply because I hire them, guarantee them a
regular check when I get none, and insulate them from the predations
and petty ministration of their rulers.  Showing up for a paycheck at
a factory does not entitle you to the factory.

Freedom means you can start something yourself, if you want those
rewards and are prepared to take those risks; government means you
can't, to a larger and larger extent.

Society as whole provides the environment where you can hire
technically educated employees, communicate with them, and have them
travel around and get looked after when they get sick.

Your taxes support that society. Try setting up an innovative business
in a third world country where the tax rates are lower (or easily
evaded by bribing the right people).

Showing up for a paycheck at a factory doesn't entitle you to the
whole factory, but the last hundred years has demonstrated that the
optimum split for rewarding capital versus labour comes out at around
fifty-fifty.

My business spends a tad over 50% of revenues on salaries, retirement
funds, benefits, and insurance/other worker-related fees. 22 to 24% is
parts. Most of the rest is rent, professional services, utilities,
subcontracting, things like that. Then there's the heap of fees and
taxes. We're small enough that we can expense capital equipment
purchases, so we do.

In a good year, that leaves a few per cent for profit, the return on
capital.

Where's my 50:50 split?

You are plowing it back into the business -"expense capital equipment"
- which you presumably own.

And which we use, and which wears out, and which will have an ebay
value close to zero when it's worn out... if we're lucky. More likely
we'll have to pay to have it hauled away. There's no pot of gold
there.

If you weren't going to make money out of the equipment you wouldn't
have bought it. It's a depreciating asset, but until it is fully
depreciated its an asset to the firm and adds to its value.

Damn, you are clueless about how a business actually works.

Based on your comment above, you are the one who is clueless.

You don't seem to be exracting a
commercial rate of return on the equity that you have built up in the
business, but if the business is becoming more valuable, year by year,
and you own it, the increase in value could be seen as your return on
capital.

I will never, under any reasonable scenario, cash out for anything
approaching the sum of salaries and benefits I have disbursed to
employees over the years.

Of course not. That's part of your running expenses, and has to be
funded from money you collect the gear that you sell every year.

IBM and Exxon and Boeing manage small
profits in good years, losses in bad years, but every month they
generate a mountain of payroll checks. The numbers of my business
aren't much different from Boeing's, or that of any modestly
successful restaurant: a few percent "profit" (which isn't cash in the
bank) on sales and a few percent return on equity (or loss, depending)
and about 50% of gross revenue going directly to employees. ANd lots
of taxes paid.

So what. That how most businesses work. An old friend of mine in
Australia started up a company that eventually got most of its cash
flow from royalties on my friends patents, but that is exceptional,
and my old friend wasn't too pleased with the policy decisions that
lead to that state of affairs, and is now separated from the company
that he set up.

When I die, the government will make an absurd valuation of the heap,
including "goodwill", and levy enough death taxes to wipe it out,
roughly 6 times over. I suppose if they want to wipe out the
businesses that create jobs and pay taxes, it's their choice.

Your business advisors haven't suggested ways of restructuring the
company to avoid this particular scenario?

Of course they have. And it's a complex, expensive nuisance that
creates no value for anyone except those advisors.

John

 

[John Larkin]

On Wed, 19 May 2010 08:46:45 +0100, Martin Brown
<|||newspam|||@nezumi.demon.co.uk> wrote:

On 18/05/2010 16:35, John Larkin wrote:

When I die, the government will make an absurd valuation of the heap,
including "goodwill", and levy enough death taxes to wipe it out,
roughly 6 times over. I suppose if they want to wipe out the
businesses that create jobs and pay taxes, it's their choice.

You should campaign to get the law changed then.

I'd rather design electronics than try to change the world.

The UK protects family businesses and farms from being wiped out by
inheritance tax liability. Tax planning using the potentially exempt
rules would work for transfer of any asset at all provided you did it at
least 7 years in advance of your expiry. (2 years in the case of handing
a business to a close relative)

Granted it is no use at all if you fall under a bus tomorrow.

For a quick guide on how the UK system works try
http://www.estatesortrusts.co.uk/estates-inheritance-business-succession-case-study.html

It seems "Land of the Free" rips you off again!

In that I have to do a lot of expensive and boring estate planning to
avoid blunt injury from the idiotic laws, yes.

Zero inheritance taxation would remove all that silly overhead.

John

 

[John Larkin]

On Wed, 19 May 2010 09:14:20 +0100, Martin Brown
<|||newspam|||@nezumi.demon.co.uk> wrote:

On 15/05/2010 16:50, John Larkin wrote:
On Sat, 15 May 2010 11:08:13 +0100, Martin Brown
|||newspam|||@nezumi.demon.co.uk> wrote:

On 14/05/2010 21:42, John Larkin wrote:
On Fri, 14 May 2010 17:53:22 +0100, Martin Brown
|||newspam|||@nezumi.demon.co.uk> wrote:

On 14/05/2010 16:06, John Larkin wrote:
On Fri, 14 May 2010 08:31:49 +0100, Martin Brown
|||newspam|||@nezumi.demon.co.uk> wrote:

Engels saw first hand what greedy industrialists were doing to their
workers in the Lancashire cotton industry. Boiler explosions were
commonplace up until the Vulcan insurers made a stand and insisted on
proper boiler safety inspections. And in cases of tampering with safety
relief valves they would not pay out.

[snip]

It makes reasonable sense to pay your workers a living wage for the work
that they do rather than pay them less than they can sensibly live on.
Ford was about the first in the USA to actually do this.

It only makes sense if the money comes from somewhere. If all the
employers arbitrarily doubled wages, inflation would take it all away

We are talking here of industrialised manufacture that was possibly two
or more orders of magnitude more productive. All the profits went to the
mill owners and their workers were left to starve on a subsistance level
of pay because it was marginally better than being out of work.

That effect was transient. The first mill owners could indeed hire
unemployed labor cheap. As other mill owners got into the act, they
had to compete for labor whether they were nice people or not. The

That isn't how it worked at all. There were enough starving people
migrating to the cities that the mill owners could fix the price they
were prepared to pay and anyway preferred to employ children at roughly
1/10 of the adult rate where possible. The working day was unregulated
but typically around 14 hours. A brief history of some of the worst
areas of the country for these practices is online at:

http://www.manchester2002-uk.com/history/victorian/Victorian1.html

The poor were viewed as an underclass to be exploited for commercial
gain like beasts of burden and kept poor. They lived in squalour and
paid barely enough to stay alive. This "transient" situation persisted
until the late 19th century which is how Engles came to observe it.

Yes, that was al the transition period. Before technology caught up
with fertility.

A very long transitional period. It would have remained the status quo
but for the ruling classes running scared of what happened during the
French revolution. In some senses the same landless peasants and urban
poor revolt against rich overlords is playing out today in Bankok.

It seems that the global banking system has major crashes with an almost
predictable period of 80-90 years - 1847, 1929, 2008

The period is getting shorter, and nobody with any sense is doing
anything to lend stability. Quite the opposite.

Germany has just banned trading in "naked short selling" a practice
largely used to drive the share price of sound companies downwards. It
is little more than a form of spread betting on future share price.

That's a small start. I read that the ban was temporary.

John

 

[Martin Brown]

On 19/05/2010 19:55, John Larkin wrote:

On Wed, 19 May 2010 08:46:45 +0100, Martin Brown
|||newspam|||@nezumi.demon.co.uk> wrote:

On 18/05/2010 16:35, John Larkin wrote:

When I die, the government will make an absurd valuation of the heap,
including "goodwill", and levy enough death taxes to wipe it out,
roughly 6 times over. I suppose if they want to wipe out the
businesses that create jobs and pay taxes, it's their choice.

You should campaign to get the law changed then.

I'd rather design electronics than try to change the world.

Obviously that is your choice.

The UK protects family businesses and farms from being wiped out by
inheritance tax liability. Tax planning using the potentially exempt
rules would work for transfer of any asset at all provided you did it at
least 7 years in advance of your expiry. (2 years in the case of handing
a business to a close relative)

Granted it is no use at all if you fall under a bus tomorrow.

For a quick guide on how the UK system works try
http://www.estatesortrusts.co.uk/estates-inheritance-business-succession-case-study.html

It seems "Land of the Free" rips you off again!

In that I have to do a lot of expensive and boring estate planning to
avoid blunt injury from the idiotic laws, yes.

This is pretty much basic boilerplate stuff. You can spot the cut and
paste in the first draft documents from the less skilled places.

But don't you appreciate the skill that clever lawyers demonstrate in
their word craft? It isn't really all that different to the creative
processes of new software and hardware design. There are a set of rules
but they can be constructively tweaked. I have to say that my encounters
using solicitors have been about 50:50 good *and* bad.

The key to using solicitors effectively is asking the right question(s).

Zero inheritance taxation would remove all that silly overhead.

Taxing liquid assets (including house and saleable effects) of the
estate on death seems reasonable to me. You can't take it with you.

Wrecking a business based on some insane valuation does not.

Regards,
Martin Brown

 

[Greegor]

G > Sloman, Do you see yourself as egotistical,
G > smarter, or superior to other people?
G >
G > In the US, your arguments and reasoning
G > are more typical of the occasional misfit,
G > usually 17 or 18 years old and struggling
G > for IDENTITY, and going for shock value.
G >
G > Generally, these people lack real world
G > experience, and so obsess about the
G > ACADEMIC. As they get more real
G > world experience, they soon realize the
G > difference between academia and real world.
G >
G > Did you think that the KOOK LEFT was
G > populated mostly by PRODUCERS?
G >
G > You claim you are over 50, yet you still
G > place great stock in academic sources,
G > and you claim to be an Aussie ex pat
G > living off your wife in Netherlands, yet
G > you obsess about economics in the USA.
G >
G > Your situation as you've described it
G > is a bit like a cartoon!
G > A 50+ year old misfit NON-PRODUCER
G > who lives off his wife and advocates socialism?
G >
G > How amazing is that?
G >
G > There are some American retirees who
G > were cold hard capitalists but lost almost
G > everything in 2008-2009 and now that
G > they see themselves as recipients of
G > socialistic handouts, they are more
G > receptive to ideas of socialism.
G >
G > How amazing is that?

LOL

 

[Joerg]

Bill Sloman wrote:

On May 19, 8:47 pm, John Larkin
jjlar...@highNOTlandTHIStechnologyPART.com> wrote:

[...]

I probably make about what any senior engineer or engineering manager
makes; it's all I need. But I bet I have more fun than average.

Engineeering can be a great source of amusement. Given that, the money
doesn't much matter.

Pretty much my attitude, which make my incapacity to find electronic
engineering work particularly galling.

Why don't you consider consulting? I have no problem finding work. Of
course it is easier here in the US, a lot more potential clients. But
Europe also has nice companies that are fun to work with.

How's Australia in that respect? I have met engineers from there who
carved themselves a nice consulting niche. Not big projects like here
but earns a decent living.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Jim Thompson]

On Wed, 19 May 2010 14:53:45 -0700, Joerg <invalid@invalid.invalid>
wrote:

Bill Sloman wrote:
On May 19, 8:47 pm, John Larkin
jjlar...@highNOTlandTHIStechnologyPART.com> wrote:

[...]

I probably make about what any senior engineer or engineering manager
makes; it's all I need. But I bet I have more fun than average.

Engineeering can be a great source of amusement. Given that, the money
doesn't much matter.

Pretty much my attitude, which make my incapacity to find electronic
engineering work particularly galling.


Why don't you consider consulting? I have no problem finding work. Of
course it is easier here in the US, a lot more potential clients. But
Europe also has nice companies that are fun to work with.

How's Australia in that respect? I have met engineers from there who
carved themselves a nice consulting niche. Not big projects like here
but earns a decent living.

Joerg, Are you trying out for funniest post of the year? I doubt
Sloman could hold a job for a week before discovery and toss.

I'm always pleased to note that I'm the highest standard for Slowman's
disdain, but please don't feed the jerk. Let him die that most
unpleasant of deaths... alone ;-)

--
...Jim Thompson

| James E.Thompson, CTO | mens |
| Analog Innovations, Inc. | et |
| Analog/Mixed-Signal ASIC's and Discrete Systems | manus |
| Phoenix, Arizona 85048 Skype: Contacts Only | |
| Voice480)460-2350 Fax: Available upon request | Brass Rat |
| E-mail Icon at http://www.analog-innovations.com | 1962 |

 

[krw@att.bizzzzzzzzzzzz]

On Wed, 19 May 2010 07:50:39 -0700, Joerg <invalid@invalid.invalid> wrote:

krw@att.bizzzzzzzzzzzz wrote:
On Tue, 18 May 2010 11:42:26 -0700, Joerg <invalid@invalid.invalid> wrote:

krw@att.bizzzzzzzzzzzz wrote:
On Mon, 17 May 2010 14:31:43 -0700 (PDT), dagmargoodboat@yahoo.com wrote:

On May 17, 4:05 pm, "keith...@gmail.com" <keith...@gmail.com> wrote:
On May 17, 3:53 pm, dagmargoodb...@yahoo.com wrote:



On May 17, 3:41 pm, "keith...@gmail.com" <keith...@gmail.com> wrote:
[...]

Again, you're missing the point. With after-tax savings you're
*already* paying that tax. If the "Fair Tax" is implemented you get
to pay the "consumption tax" on the *AFTER-TAX* money.
I'm not missing the point, I just think you're mathematically wrong.
If the thing costs $1 today, or $0.77 plus $0.23 Fair Tax tomorrow,
what have you lost? Where have I gone wrong?
Because it cost me $1.40 yesterday (when I earned it) to have the
$1.00 today,
If you paid taxes already under the old system then you were screwed
*yesterday*. That can't be fixed-it's gone. Sorry. Me too.
No, I was playing the game by the rules yesterday. Today the government
change the rules after the game was in play. The winner is the one who spent
every dime he ever made, not the one who took care of his life.

Many of the ones who took care of their life will then move, to some
places outside the US, and escape such confiscatory "fair tax" should it
ever happen. Who knows, Baja, NZ, some island ... because then the
problem simply goes away. The consequences? Even more layoffs here.

That's fine if they don't want to take their money with them. They've already
plugged that hole.


Huh? It's just one big wire transfer.

You think you can just wire money out of the country without government
intervention? More than $10K requires all sorts of paperwork, and taxes paid.

and tomorrow (after I retire, take it out of the bank,
and spend it) it only buys $.77 worth of stuff.
$1 only buys $0.77 worth of _stuff_ today, say the Fair Tax people
(AIUI). The rest goes to taxes hidden in the item's price.
Fine, if it really works, but that was not my point.

It doesn't work.

Other than ruining people's lives who have played by the rules (the life's
savings part we are objecting to here), I think it might have legs.


I think it's a non-starter and sure hope it stays that way. At least for
the next 40-50 years

Given that congress likes (to play with) the current tax code, it's not going
to happen. I think it would be a giant step forward, but I'd prefer the
"flat" tax. Perhaps only because I understand it better, though.

If I tax-deferred the
$1.40, I could buy $1.00 worth of stuff. Any after-tax savings (that
is socked away before the change) gets hammered *twice*.
If you had tax-deferred the $1.40, you'd escape the indignities of the
old system. That's a windfall (assuming Congress allows it).
If they don't, I'll yank it all out and spend it. I may do that anyway.
Property looks like the only thing worth having.

Sure does. I am thinking about the same. But how do you avoid the
hassles of being a landlord yet not pay humongous amounts to some
property management place?

Not rent to people? Dunno. Forty years ago land was put in "the bank" by
making drive-in theaters. They paid for themselves and the taxes until the
land became incredibly valuable. Twenty years ago it was golf courses. Next?


"Next", that's just the problem. Yesterday I heard another of the
countless stories where renters had totally trashed a nice home. Fixing
it back up will likely cost all the collected rent income (before they
stopped paying), and then some.

I meant, what's the next drive-in theater or golf course investment scheme. I
agree, you don't want to deal with people.

 

[krw@att.bizzzzzzzzzzzz]

On Wed, 19 May 2010 09:42:44 -0700, Joerg <invalid@invalid.invalid> wrote:

dagmargoodboat@yahoo.com wrote:
On May 18, 2:46 pm, Charlie E. <edmond...@ieee.org> wrote:
On Mon, 17 May 2010 14:31:43 -0700 (PDT), dagmargoodb...@yahoo.com
wrote:
major snippage and attributions...

$1 only buys $0.77 worth of _stuff_ today, say the Fair Tax people
(AIUI). The rest goes to taxes hidden in the item's price.
If I tax-deferred the
$1.40, I could buy $1.00 worth of stuff. Any after-tax savings (that
is socked away before the change) gets hammered *twice*.
If you had tax-deferred the $1.40, you'd escape the indignities of the
old system. That's a windfall (assuming Congress allows it).
Going forward though, with income-taxed money, the $1 we have left
still buys the same with or without the Fair Tax. $1 with embedded
tax burden hidden inside it, or ($0.77 actual price + $0.23 Fair Tax)
both cost you $1 at the register. No loss of purchasing power.
That's the contention, AIUI.
The other false assumption is that the price would drop
instantaneously to $.77 as soon as the tax was passed.

I don't assume that. There are all sorts of 2nd and 3rd-order
effects.

In reality,
the price stays at $1.00, and the retailer uses this 'profit' to pay
off his loans. Now, as time goes by, prices 'might' drop, but I
wouldn't bet on it. I actually expect prices to rise.

I expect prices to fall, quickly. Like with gasoline there's a delay
for goods-in-transit, then market forces handle the rest.


Why would a Japanese car or Chinese-made flatscreen TV fall in price
quickly?

Because there is more than one manufacturer.

If the
government stops taking out SS and IRS taxes from my paycheck, I have
more to spend. I can then afford these now 'higher' prices of that
$1, plus $.23 fair tax, plus the sales tax of $.09, so it is now
$1.33.

As for savings, I don't sweat it as much. Yes, it makes my post-taxes
savings less valuable, but it also removes a lot of taxes on my
earnings and interest!

I'm interested in saving the time and energy I waste avoiding tax land-
mines. That's worth a lot--at least a couple weeks a year. More like
three, methinks.


There'll be new tax land-mines, like who gets to pay ficticious rent
tax, how much, and who doesn't. Et cetera.

That part still seems iffy, yes.