How would Sherdog fix the economy?

[Anung Un Rama]

Arguing every point is a good sign someone is being purposely difficult. Posts like that and ones that start with "meh" or hard for me to read.

That is exactly why he does it.

 

[RetiredSlave]

Hemp hemp hemp and more hemp. Encourage as much personal autonomy and responsibility as possible, i.e. grow a gardrn, eat well, stay fit to lessen the burden on healthcare. Dead serious on focus on the industrializing of hemp and its incredibly varied uses. Fuck you and your petroleum/plastic based rope Du Pont, fuck you haaaard.

 

[Cubo de Sangre]

That is exactly why he does it.

More and more I feel like I've overestimated him based on his ability to grasp finance and macro. Two things that get a little mathy for my aptitude. Or his petty trollishness forces him to stoop to levels of stupidity that are fairly obvious once you tune in (and aren't just some fool who likes to watch supreme arrogance in action).

He's either a bot or there's something clinical taking place.

 

[Anung Un Rama]

More and more I feel like I've overestimated him based on his ability to grasp finance and macro. Two things that get a little mathy for my aptitude. Or his petty trollishness forces him to stoop to levels of stupidity that are fairly obvious once you tune in (and aren't just some fool who likes to watch supreme arrogance in action).

He's either a bot or there's something clinical taking place.

He knows stuff, he's not an idiot.
He's just not as smart as he pretends to be and he's a major asshole and hypocrite.

 

[sickc0d3r]

But a smug asshole stock analyst disagrees with you. Surely you're just emotional over the topic and not thinking clearly.

I have no enemies amongst you so I'll just politely step around this comment

I do think you raised some legitimate, good faith points that weren't really addressed in kind, but you guys seem to have a quarrel in progress that's preventing a good discussion.

 

[Cubo de Sangre]

I have no enemies amongst you so I'll just politely step around this comment

I do think you raised some legitimate, good faith points that weren't really addressed in kind, but you guys seem to have a quarrel in progress that's preventing a good discussion.

Astute. All the more important others like yourself chime in and add perspective. Thanks.

 

[kickboxjh]

Hemp hemp hemp and more hemp. Encourage as much personal autonomy and responsibility as possible, i.e. grow a gardrn, eat well, stay fit to lessen the burden on healthcare. Dead serious on focus on the industrializing of hemp and its incredibly varied uses. Fuck you and your petroleum/plastic based rope Du Pont, fuck you haaaard.

Hemp certainly wouldn't hurt, then you guys can stop subsidizing corn.

I'd add to that and say stop propping up dying industries.

 

[freakyfarley]

just put me in office. I will be so good on the economy

 

[Jack V Savage]

Arguing every point is a good sign someone is being purposely difficult. Posts like that and ones that start with "meh" or hard for me to read.

Yes, not addressing any point means that you're so brilliant that I have nothing to say, and addressing all your points is being "purposely difficult." One almost gets the sense that you're going to find some cheap tactic to justify your anger at anyone who disagrees with you.

That is exactly why he does it.

Yes, Anung, responding to points made by other people (something you can't relate to) is just part of my secret plot to enrage Cubo.

In my simple mind, MJ is very much like tobacco and alcohol and could have a similar footprint on the economy, which would be substantial. And unlike those other recreational drugs there are substantial medical benefits to be leveraged.

If dollars shift from those two (for example) to MJ, the impact is only distributional, and I'm not seeing how that's a desirable distributional shift (not saying it's bad--just irrelevant). If you think there's something broken in the economy, the fixes would involve generating overall growth (more goods and services) or positive distributional changes (from my perspective, reducing poverty and raising middle-class incomes at the expense of the rich). Not seeing any plausible path for MJ legalization to do either of those things.

In CO we saw $1 billion in sales and 18k new jobs in 2015, which I think would be enough draw immediate attention to any fledgling industry.

Again, those aren't new jobs in the economy--they're different jobs. It would take a lot more analysis to determine if the state added 18K jobs as a result of the activity or 18K people just switched from one job to another (and, again, that's such a tiny amount that there's always going to be a question because there's too much noise). Further, we don't know if people are buying more or it's just getting tracked better. That matters from the perspective of measuring the bottom-line economic impact (are we producing more goods and services).

But, I am mostly interested in its impact on the failed drug war. Legalization potentially ends that abortion of a policy and could end up being a real game changer culturally and economically.

I agree with legalization for reasons relating to freedom, but there's no plausible mechanism for it to be part of any "fix" for the economy.

Is it the invention of internet? No. But it's a worthy topic in this thread.

I don't see how. And Cubo's flipout aside, I was just making the point that the TS had a good idea for a thread, but it got WR'ed up--with economic crankery (which the MJ thing isn't) and standard hobbyhorses (which the MJ thing is). Gave this as an example.

 

[JohnnySagebrush]

Interesting subject to ponder. I'm no economic genius, but I rub shoulders with several. My brother is a econ PhD and I often get the chance to drink with him and several of his fellow economists from the University of Chicago and Northwestern. From talking to them, I know what I don't know and that I would need help from
experts to "fix" the economy.

The economy is doing well now and will likely be humming along for the next 5-10 years. As it should be-interest rates have been ungodly low, and we had massive government bail-outs and stimulus, and low fuel prices. The difficulty is in creating a stable long term economy. Our growth since the recession I compare to a tired truck driver who just popped a Benzedrine. Yes, it keeps you going, but it is artificial energy. The economy is doing well thanks to low interest rates and stimulus that have again fueled speculation. We are setting up for another crash.

The following are issues I would want to look into:
1) Financialization of the economy. The world's derivatives market is $1.2 quadrillion, 20 times GDP. This is a big deal. Our economy is build on consumption (duh!), but most of the consumption that we do isn't necessary for life or even civilization, but it is necessary to drive massive economies. Financialization amplifies market swings bigly. We do not have a resilient economy.
2) "Too big to fail" banks: I would want to find a way to make it so we could lose several mega banks in a crisis and not have a calamity. How to do this?
3) The looming job shortage caused by automation, technological advances, and outsourcing. What do we do when skilled service jobs are done by a machine? I see the jobs shortage as the biggest issue to our economy as I know it.
4) Reducing indebtedness of average citizen-should an effort be made towards this goal? How?

I'd like to type up more on this issue but I have to start Christmas dinner. As you can see, my priority would be a stable economy that is sustainable, not 10 percent growth for 4 years where speculators make a fortune and then we crash.

 

[sickc0d3r]

If dollars shift from those two (for example) to MJ, the impact is only distributional, and I'm not seeing how that's a desirable distributional shift (not saying it's bad--just irrelevant). If you think there's something broken in the economy, the fixes would involve generating overall growth (more goods and services) or positive distributional changes (from my perspective, reducing poverty and raising middle-class incomes at the expense of the rich). Not seeing any plausible path for MJ legalization to do either of those things.



Again, those aren't new jobs in the economy--they're different jobs. It would take a lot more analysis to determine if the state added 18K jobs as a result of the activity or 18K people just switched from one job to another (and, again, that's such a tiny amount that there's always going to be a question because there's too much noise). Further, we don't know if people are buying more or it's just getting tracked better. That matters from the perspective of measuring the bottom-line economic impact (are we producing more goods and services).



I agree with legalization for reasons relating to freedom, but there's no plausible mechanism for it to be part of any "fix" for the economy.



I don't see how. And Cubo's flipout aside, I was just making the point that the TS had a good idea for a thread, but it got WR'ed up--with economic crankery (which the MJ thing isn't) and standard hobbyhorses (which the MJ thing is). Gave this as an example.

1) I think there's evidence that new dollars were spent, not just shifted from one vice to another. Tax revenue from MJ was exceeded only by tobacco last year among excise products, and it tallied 3 times higher than alcohol sales revenue. At the same time, revenue from both alcohol and tobacco sales rose significantly compared to previous years, so it doesn't appear that MJ has hurt those products' sales, and may have even boosted them. Here's the annual report from 2015 if you care to look at it:
https://www.colorado.gov/pacific/sites/default/files/2015 Annual Report_1.pdf

If distribution is a goal, and I believe it should be, revenue from MJ goes not only towards education, but homeless outreach programs, rec centers, and infrastructure improvements. It's not a progressive tax, though, so it doesn't meet the criteria of redistributing only from the wealthy.
However, Jobs in that industry are mostly blue collar and service, and anyone with a basement or garage can grow plants, so it is an industry that benefits the lower and middle classes in terms of income.
Anyway, I think the challenge of the OP was to bring a list of policy changes that could have a cumulative effect, not necessarily a magic bullet.

2) You are correct that it will take more time and analysis to gauge the impact so there is nothing conclusive, but speculation is sort of what we're doing here.

3) Yeah, the word "fix" is actually strange for this topic considering the economy is already doing pretty well. Legalizing weed wouldn't be a fix for anything, except maybe individual liberty. It would be a boon, though.
The OP suggested modest MW hikes which isn't exactly a "fix" either.
Like I said, if it's a list of policies that would have a cumulative effect he/she's looking for, I don't see why legalization doesn't fit the bill.

4) You may have pegged me there (hobbyhorse projects). However, I think tax dollars and directly related jobs, crime rates, employable people (because they don't have criminal records), and health benefits that are yet to be fully understood and can potentially castrate some of the existing, way more expensive, pharmaceuticals out there, are all a pretty big deal to real people and the economy. Just the delivery of health benefits alone to people who can't afford expensive medicine should be right up your alley.

The way I look at it... and I admit this may be an overly simplistic viewpoint... if we were to reinstate alcohol prohibition, what would that do to the economy? It would be a massive blow. If MJ might have an impact similar to alcohol, even if it is partially just a shift from one industry to another, it's worth discussion.

 

[JohnnySagebrush]

Interesting subject to ponder. I'm no economic genius, but I rub shoulders with several. My brother is a econ PhD and I often get the chance to drink with him and several of his fellow economists from the University of Chicago and Northwestern. From talking to them, I know what I don't know and that I would need help from
experts to "fix" the economy.

The economy is doing well now and will likely be humming along for the next 5-10 years. As it should be-interest rates have been ungodly low, and we had massive government bail-outs and stimulus, and low fuel prices. The difficulty is in creating a stable long term economy. Our growth since the recession I compare to a tired truck driver who just popped a Benzedrine. Yes, it keeps you going, but it is artificial energy. The economy is doing well thanks to low interest rates and stimulus that have again fueled speculation. We are setting up for another crash.

The following are issues I would want to look into:
1) Financialization of the economy. The world's derivatives market is $1.2 quadrillion, 20 times GDP. This is a big deal. Our economy is build on consumption (duh!), but most of the consumption that we do isn't necessary for life or even civilization, but it is necessary to drive massive economies. Financialization amplifies market swings bigly. We do not have a resilient economy.
2) "Too big to fail" banks: I would want to find a way to make it so we could lose several mega banks in a crisis and not have a calamity. How to do this?
3) The looming job shortage caused by automation, technological advances, and outsourcing. What do we do when skilled service jobs are done by a machine? I see the jobs shortage as the biggest issue to our economy as I know it.
4) Reducing indebtedness of average citizen-should an effort be made towards this goal? How?

I'd like to type up more on this issue but I have to start Christmas dinner. As you can see, my priority would be a stable economy that is sustainable, not 10 percent growth for 4 years where speculators make a fortune and then we crash.

This is disjointed, but I'm going to add on to this.

I see indebtedness of the middle and lower class as a stifling factor, both to the individual and the economy.
If I were to spend billions on stimulus, it would target these folks. Not multinational banks. You get a lot more bang for your buck this way. Wealth congregated at the top gets hoarded away and invested in ways that only increases financialization. Wealth lower on the chain gets spent on goods. The mechanism for this stimulus would be things like student loan forgiveness.

We have to look at the appropriate level of regulation of the banking and financial industry that allows growth but defines and reigns in excessive speculation. Maybe Dodd Frank is too draconian, maybe not. I don't know.

Many things that effect the economy are very political. Look at health care. You can say "reform health care," but what does that mean and how do you do it? Burgeoning health care costs are a major drag on the economy and need to be addressed.

The deficit. Maybe not a problem yet, but it will be. Good luck tackling that. Yes, we spend too much and collect too little. Our taxes are unrealistically low for the services we demand. My thoughts are to tackle it from both sides; increase taxes and diminish our bureaucracy. Complete tax reform that makes it impossible for folks to shirk their civic duty to contribute taxes to pay for services they utilize. It's absurd that someone like Trump can pay less taxes than a surgeon. Easy, right? Well, no. That's a multiple generation problem.

 

[Jack V Savage]

1) I think there's evidence that new dollars were spent, not just shifted from one vice to another. Tax revenue from MJ was exceeded only by tobacco last year among excise products, and it tallied 3 times higher than alcohol sales revenue. At the same time, revenue from both alcohol and tobacco sales rose significantly compared to previous years, so it doesn't appear that MJ has hurt those products' sales, and may have even boosted them.

Possible. Also possible that money was shifted from some other source or came from out-of-staters (which wouldn't be relevant to expectations on a national level). Either way, the size of the impact is very small.

Here's the annual report from 2015 if you care to look at it:
https://www.colorado.gov/pacific/sites/default/files/2015 Annual Report_1.pdf

https://www.colorado.gov/pacific/sites/default/files/2015 Annual Report_1.pdf

Thanks.

If distribution is a goal, and I believe it should be, revenue from MJ goes not only towards education, but homeless outreach programs, rec centers, and infrastructure improvements. It's not a progressive tax, though, so it doesn't meet the criteria of redistributing only from the wealthy.

Yeah, it's a regressive tax that appears to have either shifted or added (or some combination of the two) 0.7% to revenue. If the goal is increasing gov't revenue to use on good programs, there are better ways to go about it.

Anyway, I think the challenge of the OP was to bring a list of policy changes that could have a cumulative effect, not necessarily a magic bullet.

There's no magic bullet. Spurring growth without immigration is a notoriously difficult policy problem (immigration is an easy solution that I can't remember if I mentioned--high-skilled is better but all immigration is good). But I don't see any way that MJ moves the needle at all.

2) You are correct that it will take more time and analysis to gauge the impact so there is nothing conclusive, but speculation is sort of what we're doing here.

Sure, but the point I was making was that the impact is too small to measure.

3) Yeah, the word "fix" is actually strange for this topic considering the economy is already doing pretty well. Legalizing weed wouldn't be a fix for anything, except maybe individual liberty. It would be a boon, though.
The OP suggested modest MW hikes which isn't exactly a "fix" either.
Like I said, if it's a list of policies that would have a cumulative effect he/she's looking for, I don't see why legalization doesn't fit the bill.

MW hikes aren't going to do anything for the broader economy, but they can help a little with distribution. I actually would support a small hike and indexing it to inflation (so the issue can be put to rest unless consciously want to raise or lower it). But as I've mentioned many times here, pre-transfer poverty is primarily about no-income groups (children, elderly, disabled, college students, unpaid caretakers) rather than low-income groups. That's a huge obstacle to efforts to try to manipulate market incomes to raise standards of living for those on the bottom.

 

[Jack V Savage]

If I were to spend billions on stimulus, it would target these folks. Not multinational banks. You get a lot more bang for your buck this way. Wealth congregated at the top gets hoarded away and invested in ways that only increases financialization. Wealth lower on the chain gets spent on goods.

I agree with this, but I think we're either near or already at the point where we want less expansionary fiscal policy rather than more. There's a limit to how many jobs we can fill and how fast the economy can actually grow, and further stimulus beyond that point (in the form of higher deficits) crowds out private investment and causes higher inflation without reducing unemployment or increasing wages. Bill James used to always say, "There's a price you pay for everything you believe that isn't true," and I think the price for people denying the current strength of the economy could be a slowdown in real growth and inflation legitimately becoming a problem.

 

[Cubo de Sangre]

If dollars shift from those two (for example) to MJ, the impact is only distributional, and I'm not seeing how that's a desirable distributional shift (not saying it's bad--just irrelevant). If you think there's something broken in the economy, the fixes would involve generating overall growth (more goods and services) or positive distributional changes (from my perspective, reducing poverty and raising middle-class incomes at the expense of the rich). Not seeing any plausible path for MJ legalization to do either of those things.

There's a ton of new products related to marijuana. Not only in medicinal and recreational extracts but also associated paraphernalia. The excise taxes are a positive change in distribution where it's being used directly for schools and other benefits to the community. While that still not be enough to satisfy you, there's far more going on than your comments would lead one to believe.

 

[sickc0d3r]

Possible. Also possible that money was shifted from some other source or came from out-of-staters (which wouldn't be relevant to expectations on a national level). Either way, the size of the impact is very small.


Thanks.



Yeah, it's a regressive tax that appears to have either shifted or added (or some combination of the two) 0.7% to revenue. If the goal is increasing gov't revenue to use on good programs, there are better ways to go about it.



There's no magic bullet. Spurring growth without immigration is a notoriously difficult policy problem (immigration is an easy solution that I can't remember if I mentioned--high-skilled is better but all immigration is good). But I don't see any way that MJ moves the needle at all.



Sure, but the point I was making was that the impact is too small to measure.



MW hikes aren't going to do anything for the broader economy, but they can help a little with distribution. I actually would support a small hike and indexing it to inflation (so the issue can be put to rest unless consciously want to raise or lower it). But as I've mentioned many times here, pre-transfer poverty is primarily about no-income groups (children, elderly, disabled, college students, unpaid caretakers) rather than low-income groups. That's a huge obstacle to efforts to try to manipulate market incomes to raise standards of living for those on the bottom.

We're not going to find much common ground on MJ, so I'll move on from that topic.

I'm glad you mentioned immigration because maybe the surest way to grow an economy is to grow the population. Another sure thing is technology. Whatever can be done to encourage innovation between academia and corporations, sign me up.

There's also been a lot of discussion about UBI around here. What would you think of dismantling programs related to welfare and converting them into cash that goes directly to people? Also, get rid of payroll taxes and institute a federal LVT. I'd start the ball rolling at age 0 so when kids turn 18 they have a nice chunk of change already waiting for them.

 

[chubbman]

Deport all lower class minorities

 

[Jack V Savage]

There's also been a lot of discussion about UBI around here. What would you think of dismantling programs related to welfare and converting them into cash that goes directly to people? Also, get rid of payroll taxes and institute a federal LVT. I'd start the ball rolling at age 0 so when kids turn 18 they have a nice chunk of change already waiting for them.

Absolutely agree that cash is the best form of aid. People know what they need as individuals better than lawmakers do. And yes, I'd favor an LVT (land value tax, right?) over payroll taxes, though there are some real political issues there (namely that SS is so safe and popular in part because of the way people think of it, which is helped by the way it's funded).