[conanbatt]

Trickle down economics is a pejorative term from the 30's. As a proposition it is as naive as trickle-up, which is what the other spectrum usually sells. ('if you give poor people more resources, its good for everyone')

Economics, as the expression of human beings exchanging with each other, accepts neither.

[djrobstep]

> Economics, as the expression of human beings exchanging with each other, accepts neither.

I will never understand how adults can believe that things like economics, journalism, central banking, and (especially) the US constitution can be non-political.

[RobertoG]

Because that idea (about economics) has been heavily, and successfully, pushed by interested parties:

'The economy' and 'the market' are sacred things that are disconnected from the dirty world, and work perfectly in their own if you don't bother them. No need for 'political economy' anymore, only 'economics'.

[conanbatt]

Gotta answer that last sentence. Free market advocates are the exact opposite of disconnected with the dirty world: they advocate for allowing the dirtyness of reality sort itself out, without a neat central order. The most significant advocate for free markets, Milton Friedman, literally wrote the book on the application of Positive Economics: seeing things how they really are, use empiric data, make falsifiable predictions, etc.

Free markets are pro-reality, pro-dirty world.

[RobertoG]

Well, if you start with the idea that markets exist in the void, you are certainly avoiding the dirty world.

For instance: assuming that property rights exist outside a political framework or power structures.

[GabrielBen]

They don't exist in "the void". Property rights are fundamental to the free market ideology, as well as courts, police and military. It's the foundations of liberalism, with Locke, Adam Smith, etc.

I reiterate that free market ideology is positive, while government intervention ideology is more normative: it says how things should be and tries to make it so. The best case of this has been obviously Communism and Fascism: they said this is best, and organized top to bottom how things should be, and ignored any evidence of the contrary.

[djrobstep]

What is it that motivates you to be a booklicker for the rich?

[conanbatt]

I am surprised on people that believe politics shape reality, as if a political will could bend laws of nature.

[djrobstep]

If you think economics is about "laws of nature", then you have a lot to learn about economics.

[RobertoG]

>>'if you give poor people more resources, its good for everyone')

It's not 'poor people' vs. 'rich people' but the majority vs. a minority.

>>"Economics, as the expression of human beings exchanging with each other, accepts neither."

Economics? what do you mean? There are theories that, in a less simplistic way, come to propose one and the other.

[conanbatt]

> It's not 'poor people' vs. 'rich people' but the majority vs. a minority.

As silly a proposition as any other.

> Economics? what do you mean? There are theories that, in a less simplistic way, come to propose one and the other.

Mostly politicians and pundits. Economics, neither the mathematically inclined microeconomics nor the formulaic and macroeconomics have such thought or principles behind them.

[enraged_camel]

>>As a proposition it is as naive as trickle-up, which is what the other spectrum usually sells. ('if you give poor people more resources, its good for everyone')

Incorrect. It has been well-documented that when people have more disposable income, their spending increases. This increase in economic activity grows the economy.

[conanbatt]

If they have more disposable income, their spending decreases. If you have no disposable income, your spending 100% of your income.

Moreover even if that proposition were somehow true, spending is not a measure of progress of any kind, not nominally and not in real terms. Inflation is a good exercise on this topic.

It's a funny thing that trickle-up is never ridiculed in the public eye.

[darawk]

> Incorrect. It has been well-documented that when people have more disposable income, their spending increases. This increase in economic activity grows the economy.

It has been well documented that when you give people who have proven themselves capable of efficiently allocating capital (i.e. the rich) more capital, they continue to allocate it to its best and most productive use for society.

Everyone's got a narrative, and they're both right. To an extent.

[enraged_camel]

>>when you give people who have proven themselves capable of efficiently allocating capital (i.e. the rich) more capital, they continue to allocate it to its best and most productive use for society.

You are making some wild assumptions that require evidence. Specifically, you need to prove that the reason rich people are rich is because they "have proven themselves capable of efficiently allocating capital", as opposed to (or at least independent of) other factors, such as luck, inheritance, etc. You also need to prove that the way the rich allocate resources, even when "efficient" (i.e. provides the most return) is actually good for society as a whole, and not just the rich.

[darawk]

> You are making some wild assumptions that require evidence. Specifically, you need to prove that the reason rich people are rich is because they "have proven themselves capable of efficiently allocating capital", as opposed to (or at least independent of) other factors, such as luck, inheritance, etc.

I'm not making any assumptions. In aggregate, by definition, wealthy people are better at allocating capital than non-wealthy people. Yes, not all wealthy people are good at it. But in general, they are. That's why they're wealthy. The fact that exceptions exist is irrelevant to my point.

> You also need to prove that the way the rich allocate resources, even when "efficient" (i.e. provides the most return) is actually good for society as a whole, and not just the rich.

Do you have evidence that the way the poor allocate additional capital is more socially useful?

[zanny]

Its a generally well documented trend that once rich it becomes difficult to actually fall out of wealth. I'd definitely love some unbiased research in how much better these purported rich people are better at allocating capital.

Because I can easily start naming microeconomically selfish ways of managing capital that the wealthy practice on the regular that it is no way economically beneficial to the parent economy - offshore tax havens, tax loopholes, real estate bubbles, buying politicians and policy to harm liberty, investing in companies that themselves offshore, launder, and hide their capital outside of the economy.

Businesses in the US are magnitudes wealthier today than they were forty years ago but the standard of living has at best remained stagnant for the last 20 (depending on locality, there are substantial regional swings). Money is flush in the upper echelons of society but it has provably and demonstrably not resulted in economic prosperity for the whole nation.

[darawk]

> Its a generally well documented trend that once rich it becomes difficult to actually fall out of wealth. I'd definitely love some unbiased research in how much better these purported rich people are better at allocating capital.

Huh? The fact that they're rich is proof.

> Because I can easily start naming microeconomically selfish ways of managing capital that the wealthy practice on the regular that it is no way economically beneficial to the parent economy - offshore tax havens, tax loopholes, real estate bubbles, buying politicians and policy to harm liberty, investing in companies that themselves offshore, launder, and hide their capital outside of the economy.

Sure, but they had to get rich in the first place.

> Businesses in the US are magnitudes wealthier today than they were forty years ago but the standard of living has at best remained stagnant for the last 20 (depending on locality, there are substantial regional swings). Money is flush in the upper echelons of society but it has provably and demonstrably not resulted in economic prosperity for the whole nation.

Yes, its been very unevenly distributed. How do you think that relates to the question at hand?

[maxxxxx]

What will these rich capital allocators do when nobody has money to buy their stuff? We need people to produce things and we need people who buy things. Both of these roles are equally important. Considering how housing and other asset prices are going up and companies like Apple are sitting on billions of dollars it seems there are a lot of rich people who don't know how to invest their money productively.

[darawk]

> What will these rich capital allocators do when nobody has money to buy their stuff? We need people to produce things and we need people who buy things. Both of these roles are equally important. Considering how housing and other asset prices are going up and companies like Apple are sitting on billions of dollars it seems there are a lot of rich people who don't know how to invest their money productively.

Totally agree. To be clear, i'm not advocating either narrative, just pointing out that both sides have one. I think they're both important. You need efficient allocators productively allocating capital...and you need them to have the capital to do it with. You also need consumers, with the buying power to make the capital allocators allocations work. The debate ends up being around what the right mix is, and I don't know the answer to that, simply pointing out that it's not a one-sided narrative of "give poor people money!" or "give rich people money!".