The Top 1% of Americans Have Taken $50 Trillion From the Bottom 90%

[Elixir]

It's accurate in a zero-sum game, which economies are not.

That is true in the long run, but not necessarily in the short run.

But that's not an observation. "The rich gain" is an observation. "At the expense of others" is a theory-laden interpretation derived from zero-sum-game mental models.

Not really. I have seen people argue that the ____ (you fill in the blank) at the expense of others even when the others gain. The argument is that the _____ gain disproportionately with respect to someone's view of morality or the good or something else.

IMO you're both "right", only depending on whether the fact that it is difficult to quantify things like opportunity cost renders them negligible.

 

[Elixir]

(Oh, and incidentally, you guys do not have a point that inequality is rising and that's bad for general prosperity. Inequality is falling. The 1975-2018 period the article complains about has seen historically unprecedented drops in the Gini index. People's incomes are becoming more and more equal. The reason you guys are ignoring that fact and claiming the reverse is that you are tribal thinkers. You are evidently subconsciously assuming only Americans matter.)

Wow! Do you want to back this up with a citation? It goes against every other source I've reviewed.

Yeah, I think that's misleading at best. THIS sure doesn't look like things are equalizing at all. Quite the opposite.



Charts that are more granular and show the wealth of the top 0.1% are REALLY alarming. They can't even accommodate the tiny sliver spike on the right without compressing everyone else down to the bottom of the page.

 

[SimpleDon]

This is assuming we have accurate income numbers from back then.

Strangely enough there was a period in which the tax code was brutal to high personal income--during which personal income was a lot lower than either before or after. This was a period where there were a lot of legal tax avoidance schemes and little ability to detect tax evasion by the rich.

Why do I think the income numbers weren't accurate during that period?

Do you think that there is less tax avoidance now than there was in 1975?

One simple example: Look at the crash in commercial real estate prices in the 80s. That came about because it had been driven up way above it's true market value because of it's use in tax avoidance.

The run up in real estate values is also caused by the income inequality. When given an increase in income the already rich are more inclined to save the increase rather than spend it on consumption. They buy Treasury bills and other bonds, they put it into the stock market, they buy oil and gas leases, they buy paintings, old cars, antiques, etc., and they buy commercial real estate, largely through REITs.. This all in an effort to produce a return on these investments. This produces inflation in these areas, the stock market goes up, interest rates go down, and the price of commercial real estate goes up.

The very cornerstone of your supply-side economics is that the already rich are more likely to "invest" any income increase. But they are by and large savings, not economy building investments that provide jobs. And savings are money that is withdrawn from the economy.

We have covered this ground before, you and I. You actually were reduced to saying that the savings in banks got out into the economy somehow, you just couldn't tell me how this happens.

Certainly, income tax avoidance due to the capital gains scam is higher today than in 1975. Tieing CEO bonuses to the corporation's stock price and thereby encouraging them to convert corporate income into higher stock prices by buying their own stock was unheard of in 1975.

While it is bad for the economy it has nothing to do with tax avoidance.

I am sorry but you are wrong. It has everything to do with tax avoidance, it converts profits into capital gains. If the profits are distributed as dividends they are taxed in the year that they are received as personal income. When the profits are used to buy back the corporations stock the stock price increases and the increase is considered to be capital gains which is paid only when and if the stock is sold, at the reduced tax rate for capital gains, usually half of the rate at the top for personal income.

It is telling that you didn't know this. There is much more of this single tax avoidance and tax delay than there was in 1975. Voiding your point completely.

Do you agree that there is a much worse income and wealth inequality today than there was in 1975?

I'm saying we don't have the data one way or the other, and the problem is far more complex than simply tax policy anyway.

But we do have good data for incomes today and in 1975. Every year on April 15 we pay our taxes by reporting our incomes.

You are bordering on what I consider the most ridiculous argument for supply side economics, that if we lower their taxes the already rich are less likely to cheat on their taxes or to take advantage of the many illegal tax avoidance schemes. It is if the otherwise firm and steadfast capitalists were denying in this single instance the driving force behind capitalism, greed.

You would expect inequality to go up with the computer revolution. It made highly skilled people far more productive because they waste far less time on low-skill parts of their job. Taxing that away would be very unfair.

Also, even at the bottom the standard of living has risen, just not as fast as it did at the top.

Yes, the average real wage for the majority of the non-rich has gone up by 8% in the forty years of neoliberalism defining our economic policies. This is for the bottom 50%, 1980 to pre-COVID-19 depression. It is certain that this modest gain has been completely wiped out in the depression made worse than it had to be by the incompetence of conservative governance.

And yes, it is much more complicated than just tax policies. We changed our economic policies starting in the 1970s. This argument that the economy is now somehow naturally, almost magically decided to reward the skilled rather than the unskilled completely ignores this fact.

Essay question: Do you believe that the changes in our economic policies had no effect on the income distribution in the US?

I seriously doubt that. In fact, I believe that the main purpose of these changes was to tilt the income distribution to favor the already rich at the costs of everyone else.

There are very few jobs that don't require some skills. Your argument that as much as 50% of the workforce is unskilled demeans these workers. Just another reason that so many feel alienated today and lash out by doing often contradictory and harmful things, like voting for Trump.

 

[Canard DuJour]

take from
(phrasal verb of take)

detract from.
"training for the show has not taken from her efforts to campaign for the shipyard"

There we go - perfectly consistent with the upward redistribution in question. No necessary implication of criminal or property rights violation or whatever other moral outrage (and certainly nothing to do with medieval antisemitism ).

A redistribution of GDP share detracts from the losers unless the redistribution increases GDP such that the losers are no worse off. Which cannot possibly be the case where redistribution has reduced GDP growth - as appears to have been the case.

I was not the tallest person in my grade level in year 7, but I was by the the tallest person in my grade level in year 12. The 'height inequality' got larger between year 7 and year 12, but I didn't take anybody's height.

Because there's no equivalent of GDP in that analogy. During the post-war decades of shared GDP growth, Americans were on average the tallest people in the developed world. They're now among the shortest. This reversal has occured over the period during which 90% of Americans got an ever smaller share of GDP, and where that inequality has increased by the widest margin.

 

[Loren Pechtel]

The claim on its face looks absurd. When you save money you normally invest it, which means you lend it at interest or you buy equity. Why would anyone pay you interest, or give you his property in return for your money, unless he was planning to spend or reinvest the money he's getting from you? And even in case you don't invest your saved money but just stuff it under your mattress, or you lend it to somebody who just sits on it and doesn't spend it or reinvest it in turn, then those dollars will stop contributing to the chasing of goods and services, which will make inflation go down, which will let the government get away with increasing the money supply to compensate, and then those new dollars will get spent in place of the dollars under the mattress, provided the government is staffed by good little Keynesians. So it seems on its face that that much money is going to get spent, one way or another, whether you spend it yourself or you let somebody else spend it for you.

So if you do agree with SD that "Money that is saved is withdrawn from the economy.", can you explain how that works?

This is blasphemy to the left. The truth is irrelevant.

 

[Loren Pechtel]

Nah:

One common misconception is that banks act simply as intermediaries, lending out the deposits that savers place with them. In this view depositsare typically ‘created’ by the saving decisions of households, and banks then ‘lend out’ those existing deposits to borrowers, for example to companies looking to finance investment orindividuals wanting to purchase houses.

In fact, when households choose to save more money in bank accounts, those deposits come simply at the expense of deposits that would have otherwise gone to companies in payment for goods and services. Saving does not by itself increase the deposits or ‘funds available’ for banks to lend. Indeed, viewing banks simply as intermediaries ignores the fact that, in reality in the modern economy, commercial banks are the creators of deposit money.

This doesn't make sense. They are right that deposits are at the expense of consumer spending. However, while the money from consumer spending will also go to into bank it won't stay there, almost all of it will soon go to the suppliers and the workers.

 

[Loren Pechtel]

One simple example: Look at the crash in commercial real estate prices in the 80s. That came about because it had been driven up way above it's true market value because of it's use in tax avoidance.

The run up in real estate values is also caused by the income inequality. When given an increase in income the already rich are more inclined to save the increase rather than spend it on consumption. They buy Treasury bills and other bonds, they put it into the stock market, they buy oil and gas leases, they buy paintings, old cars, antiques, etc., and they buy commercial real estate, largely through REITs.. This all in an effort to produce a return on these investments. This produces inflation in these areas, the stock market goes up, interest rates go down, and the price of commercial real estate goes up.

If it wasn't about tax policy the market wouldn't have crashed when the tax loophole was closed.

The very cornerstone of your supply-side economics is that the already rich are more likely to "invest" any income increase. But they are by and large savings, not economy building investments that provide jobs. And savings are money that is withdrawn from the economy.

Building things that produce money is not removing it from the economy, it's just a different cycle in the economy and it's very necessary.

I am sorry but you are wrong. It has everything to do with tax avoidance, it converts profits into capital gains. If the profits are distributed as dividends they are taxed in the year that they are received as personal income. When the profits are used to buy back the corporations stock the stock price increases and the increase is considered to be capital gains which is paid only when and if the stock is sold, at the reduced tax rate for capital gains, usually half of the rate at the top for personal income.

The % of corporate income that goes to stock options is quite small. The real way it happens is what we are seeing now--use the money to buy other companies.

Do you agree that there is a much worse income and wealth inequality today than there was in 1975?

I'm saying we don't have the data one way or the other, and the problem is far more complex than simply tax policy anyway.

But we do have good data for incomes today and in 1975. Every year on April 15 we pay our taxes by reporting our incomes.

No, we don't. You are assuming the returns are honest and there's no way money can be characterized in different ways.

You are bordering on what I consider the most ridiculous argument for supply side economics, that if we lower their taxes the already rich are less likely to cheat on their taxes or to take advantage of the many illegal tax avoidance schemes. It is if the otherwise firm and steadfast capitalists were denying in this single instance the driving force behind capitalism, greed.

No. I'm not saying that lowering the tax rate increases the tax take. That's nonsense unless the tax rates are very high.

Yes, the average real wage for the majority of the non-rich has gone up by 8% in the forty years of neoliberalism defining our economic policies. This is for the bottom 50%, 1980 to pre-COVID-19 depression. It is certain that this modest gain has been completely wiped out in the depression made worse than it had to be by the incompetence of conservative governance.

I do agree the gains have been wiped out by the Republican stupidity. That's evidence the Republicans are fucked up, not that the economy doesn't need investment. What you don't see is that the ratio of capital to workers has a major effect on the standard of living. You should not expect worker income to go up at the rate that GDP does as that would put a big crimp in the economic growth rate. More now, less down the road.

And yes, it is much more complicated than just tax policies. We changed our economic policies starting in the 1970s. This argument that the economy is now somehow naturally, almost magically decided to reward the skilled rather than the unskilled completely ignores this fact.

It's not that we changed our economic policies, it's that the system changed with the coming of the information age. Unions fare well when workers are basically stamped out with a cookie cutter. Unions fare poorly when there are bigger differences between employees.

There are very few jobs that don't require some skills. Your argument that as much as 50% of the workforce is unskilled demeans these workers. Just another reason that so many feel alienated today and lash out by doing often contradictory and harmful things, like voting for Trump.

"Unskilled" refers to jobs you don't need to have training before being hired. The company shows you what to do, you do it.

 

[Canard DuJour]

Nah:

One common misconception is that banks act simply as intermediaries, lending out the deposits that savers place with them. In this view depositsare typically ‘created’ by the saving decisions of households, and banks then ‘lend out’ those existing deposits to borrowers, for example to companies looking to finance investment orindividuals wanting to purchase houses.

In fact, when households choose to save more money in bank accounts, those deposits come simply at the expense of deposits that would have otherwise gone to companies in payment for goods and services. Saving does not by itself increase the deposits or ‘funds available’ for banks to lend. Indeed, viewing banks simply as intermediaries ignores the fact that, in reality in the modern economy, commercial banks are the creators of deposit money.

This doesn't make sense. They are right that deposits are at the expense of consumer spending.

and that it detracts from investment. Are you more likely to invest in production if

(a) consumers pay you in exchange for whatever you produce

(b) consumers don't buy whatever produce so you have to borrow at interest in order to prouduce stuff which consumers have shown unwillingness to buy

..?

However, while the money from consumer spending will also go to into bank it won't stay there, almost all of it will soon go to the suppliers and the workers.

It won't because banks do not lend out depositors' money, or fractions thereof. It doesn't make sense to you because you're still assuming that banks are intermediaries between savers and borrowers. Not so : https://www.bankofengland.co.uk/-/m...tin/2014/money-creation-in-the-modern-economy

 

[Bomb#20]

One way business increases profit margins is by keeping wage cost down. By suppressing wage growth (or moving to a third world country) they are taking the possible or potential earnings of workers and using it for their own gain. It is a form of stealing.

That looks like another fun game! Can I play too?

One way unions decrease profit margins is by keeping wage cost up. By promoting wage growth (or preventing the hiring of nonmembers) they are taking the possible or potential earnings of stockholders and using it for their own gain. It is a form of stealing.

So now that we have established that everybody is taking from everybody and everybody is stealing and everybody is being stolen from, let us all step back from the brink of intellectual suicide and take a moment to consider whether the word "steal" really means "trade with each other at a price point different from the price point I just pulled out of my ass."

You are free to play as much as you like. The point is that there is a significant percentage of workers who have very little in the way of bargaining power when it comes to negotiating a wage rate. Many workers have no individual bargaining power. The firm presents their contract on a take it or leave it basis.

And if you go into a 7-11 and buy some Twinkies, you have no bargaining power when it comes to negotiating a dollars-per-Twinkie rate. 7/11 presents its contract on a take it or leave it basis. Therefore 7-11 stole your money? Do you resent how stolen-from you are while you eat your Twinkie?

Employer power is significant but largely constant, whereas workers’ power has been eroded by policy actions

''What this report finds: Labor markets in capitalist economies are fundamentally tilted against individual workers’ ability to bargain effectively with employers. Policy does not have to be rigged for employers to give them particular clout in labor markets; instead, the very nature of these labor markets gives them clout. In the past, when economic growth was broadly shared across the population, it was because policymakers understood this basic asymmetry and used policy levers to bolster the leverage and bargaining power of workers. Conversely, recent decades’ rise of inequality and anemic wage growth has resulted from a stripping away of these policy bulwarks to workers’ labor market power.

I.e., the old ratio resulted from government putting its thumb on the scale. When the thumb was removed, the ratio changed. What makes that a form of the employers now stealing from the workers, and not a form of workers in the past having stolen from the employers, while modern workers are not stealing?

In any event, assuming the reason workers' income growth has slowed is the loss of negotiating power, well, in general the thing that makes negotiating power go away is competition -- when the other party to a negotiation has alternatives, you can't drive as hard a bargain. Back in the "good old days" of more worker bargaining power you're nostalgically looking back to, culture and government policy were acting together to keep wages up by hindering half the population from competing for jobs. You can't just add thirty million more women to the workforce and expect it not to reduce the upward pressure on wages.

By moving from the kitchen to the office, and thereby suppressing wage growth, women are taking the possible or potential earnings of male workers and using it for their own gain. So your style of reasoning proves women's liberation is a form of stealing.

Why it matters: Recent research on “monopsony power”—the leverage enjoyed by employers to set their workers’ pay—is a valuable contribution to our understanding of the asymmetry inherent in labor markets. However, “monopsony power” is often a confusing term to even the most savvy economic writers and researchers, and too often it is used only to describe markets that are concentrated (i.e., where there are relatively few employers). Market concentration can indeed suppress workers’ wages, but employer power exists even in markets with lots of employers. If only the narrow conception of “monopsony power” is recognized and policymakers focus only on interventions that target the effect of market concentration (antitrust, for example), then other measures that could more effectively restore the balance of power in labor markets might not get the consideration they should.''

By "restore the balance", they appear to mean "change the power ratio to what it used to be". Why is the old power ratio the standard for "balance"? It was a power ratio that gave far more bargaining power to male American workers than it gave to women and foreigners.

 

[DBT]

You can choose to buy Twinkies or not regardless of their cost. There is a choice. If they are too expensive, consumers stop buying. Earning a living is an entirely different matter.

 

[Bomb#20]

You can choose to buy Twinkies or not regardless of their cost. There is a choice. If they are too expensive, consumers stop buying. Earning a living is an entirely different matter.

Earning a living is only an entirely different matter because eating is an entirely different matter. Does Coles negotiate with you over the price of a load of bread? No? Does that mean Coles is stealing from you?

 

[DBT]

You can choose to buy Twinkies or not regardless of their cost. There is a choice. If they are too expensive, consumers stop buying. Earning a living is an entirely different matter.

Earning a living is only an entirely different matter because eating is an entirely different matter. Does Coles negotiate with you over the price of a load of bread? No? Does that mean Coles is stealing from you?

Stealing is not exactly the same as exploiting worker vulnerability or rigging the system to favour the top end of town and suppressing wage growth for workers. Supermarkets, as a profit driven business seeks to maximise profits by charging as much as the market bears for their products while keeping their wage costs to a minimum....except of course for the CEO and upper management where the sky is the limit.

Call it what you like, the system is constructed to favour those in power and position.

 

[Bomb#20]

This doesn't make sense. They are right that deposits are at the expense of consumer spending.

and that it detracts from investment. Are you more likely to invest in production if

(a) consumers pay you in exchange for whatever you produce

(b) consumers don't buy whatever produce so you have to borrow at interest in order to prouduce stuff which consumers have shown unwillingness to buy

..?

False dilemma. There's also

(c) other producers pay you in exchange for whatever you produce, because you produce machine tools or industrial chemicals or electric generators or ...

However, while the money from consumer spending will also go to into bank it won't stay there, almost all of it will soon go to the suppliers and the workers.

It won't because banks do not lend out depositors' money, or fractions thereof. It doesn't make sense to you because you're still assuming that banks are intermediaries between savers and borrowers. Not so : https://www.bankofengland.co.uk/-/m...tin/2014/money-creation-in-the-modern-economy

According to your link,

A bank’s business model relies on
receiving a higher interest rate on the loans (or other assets)
than the rate it pays out on its deposits (or other liabilities).
... The commercial bank
uses the difference, or spread, between the expected return on
their assets and liabilities to cover its operating costs and to
make profits. ... By attracting new deposits, the bank can
increase its lending without running down its reserves, as
shown in the third row of Figure 2. Alternatively, a bank can
borrow from other banks or attract other forms of liabilities, at
least temporarily. But whether through deposits or other
liabilities, the bank would need to make sure it was
attracting and retaining some kind of funds in order to keep
expanding lending.

The Bank of England is evidently still assuming that banks are intermediaries between savers and borrowers. The article you linked is not calling into question the conventional understanding of how banking works in any fundamental way; all it's pointing out, operationally, is that banks have a great deal of flexibility about timing. The misconception it's correcting is the notion that the deposits have to come first -- it's perfectly okay for a bank to lend out more money than it has taken in in deposits, provided it gets enough deposits afterwards. Banks, in effect, are allowed to practice a great deal of check-kiting. So a bank won't be stopped from making an individual loan by not having enough money on hand, true; but it will be stopped from making a loan if overall it can't attract enough deposits to keep from having to pay so much interest to the central bank that it becomes unprofitable. So Loren is correct that the money from customer deposits will go out to the suppliers and the workers; it's just that he's correct on average over the long run, as opposed to being correct on every penny, every day.

 

[Bomb#20]

...Does Coles negotiate with you over the price of a loaf of bread? No? Does that mean Coles is stealing from you?

Stealing is not exactly the same as exploiting worker vulnerability or rigging the system to favour the top end of town and suppressing wage growth for workers. Supermarkets, as a profit driven business seeks to maximise profits by charging as much as the market bears for their products while keeping their wage costs to a minimum....

Yes, that's not exactly the same as stealing. Likewise, workers exploiting employer vulnerability by going to work for competitors, or unionizing, thereby suppressing profit growth for stockholders, isn't exactly the same as stealing either. Workers, as a profit driven "economic man", seek to maximize worker profits by charging employers as much as the market bears for their labor while keeping their hours worked to a minimum. Everybody exploits everybody else; that's what happens in symbiotic relationships. It works because trading benefits both parties to a trade.

except of course for the CEO and upper management where the sky is the limit.

True, shareholder democracy has still not entirely solved the problem of managers pursuing management interests instead of owner interests, 250 years after Adam Smith wrote about it. But that's an issue between shareholders and CEOs. Why should non-management workers care whether the fraction of the producer surplus they don't get goes to management or to shareholders?

Call it what you like, the system is constructed to favour those in power and position.

Every system is constructed to favor those in power and position; that's pretty much the defining criterion for having power and position: you can tell who has power and position by seeing whom the system is constructed to favor. Our system, being a democracy, is naturally constructed to favor the voting majority. That's the non-management workers; they have naturally set up the system to favor themselves. That's why collusion and price-fixing are legal for workers and illegal for employers; that's why tax laws discriminate against high-income people, a.k.a. "progressive tax rates".

 

[DBT]

Yes, that's not exactly the same as stealing. Likewise, workers exploiting employer vulnerability by going to work for competitors, or unionizing, thereby suppressing profit growth for stockholders, isn't exactly the same as stealing either. Workers, as a profit driven "economic man", seek to maximize worker profits by charging employers as much as the market bears for their labor while keeping their hours worked to a minimum. Everybody exploits everybody else; that's what happens in symbiotic relationships. It works because trading benefits both parties to a trade.

There are different ways to steal, just as there different ways to exploit and capitalize on vulnerability and need. To put it under one umbrella terms 'theft' does not necessarily describe or represent what is happening in business or the workplace when they set prices and wages.

To say that workers can go to the competition is absurd when competitors offer no better deal for their workers. Unless they are in need of people with desirable skills, they have no incentive to offer better pay and conditions. It is in their interest to keep wage cost down.

Joining unions is a way of getting a better deal. It is in the interest of workers to form strong unions and bargain collectively for better pay and conditions.

Unfortunately union membership has eroded away, individual contracts replacing collective bargaining with hard won pay and conditions also eroding away.

 

[Canard DuJour]

False dilemma. There's also

(c) other producers pay you in exchange for whatever you produce, because you produce machine tools or industrial chemicals or electric generators or ...

Exactly the same applies. Firm A's decision to save comes simply at the expense of a deposit that would have otherwise gone to Firm B in payment for goods and services. As the BoE says "Saving does not by itself increase the deposits or ‘funds available’ for banks to lend."

However, while the money from consumer spending will also go to into bank it won't stay there, almost all of it will soon go to the suppliers and the workers.

It won't because banks do not lend out depositors' money, or fractions thereof. It doesn't make sense to you because you're still assuming that banks are intermediaries between savers and borrowers. Not so : https://www.bankofengland.co.uk/-/m...tin/2014/money-creation-in-the-modern-economy

According to your link,

A bank’s business model relies on
receiving a higher interest rate on the loans (or other assets)
than the rate it pays out on its deposits (or other liabilities).
... The commercial bank
uses the difference, or spread, between the expected return on
their assets and liabilities to cover its operating costs and to
make profits. ... By attracting new deposits, the bank can
increase its lending without running down its reserves, as
shown in the third row of Figure 2. Alternatively, a bank can
borrow from other banks or attract other forms of liabilities, at
least temporarily. But whether through deposits or other
liabilities, the bank would need to make sure it was
attracting and retaining some kind of funds in order to keep
expanding lending.

The Bank of England is evidently still assuming that banks are intermediaries between savers and borrowers. The article you linked is not calling into question the conventional understanding of how banking works in any fundamental way; all it's pointing out, operationally, is that banks have a great deal of flexibility about timing. The misconception it's correcting is the notion that the deposits have to come first -- it's perfectly okay for a bank to lend out more money than it has taken in in deposits, provided it gets enough deposits afterwards. Banks, in effect, are allowed to practice a great deal of check-kiting. So a bank won't be stopped from making an individual loan by not having enough money on hand, true; but it will be stopped from making a loan if overall it can't attract enough deposits to keep from having to pay so much interest to the central bank that it becomes unprofitable. So Loren is correct that the money from customer deposits will go out to the suppliers and the workers; it's just that he's correct on average over the long run, as opposed to being correct on every penny, every day.

The BoE paper states categorically that

- banks are not intermediaries between savers and borrowers.

- money lent by banks is new money created in the process of lending.

The snippet you've quoted contradicts neither. I don't know why you think so, but I'd guess the common misconception that reserves are retained fractions of savers' deposits (which, TBF, they sound like).

 

[Loren Pechtel]

This doesn't make sense. They are right that deposits are at the expense of consumer spending.

and that it detracts from investment. Are you more likely to invest in production if

(a) consumers pay you in exchange for whatever you produce

(b) consumers don't buy whatever produce so you have to borrow at interest in order to prouduce stuff which consumers have shown unwillingness to buy

..?

However, while the money from consumer spending will also go to into bank it won't stay there, almost all of it will soon go to the suppliers and the workers.

It won't because banks do not lend out depositors' money, or fractions thereof. It doesn't make sense to you because you're still assuming that banks are intermediaries between savers and borrowers. Not so : https://www.bankofengland.co.uk/-/m...tin/2014/money-creation-in-the-modern-economy

Your source does not say what you think it does.

It says most of the lending comes from commercial banks, it doesn't say depositors money isn't loaned out.

 

[Loren Pechtel]

By "restore the balance", they appear to mean "change the power ratio to what it used to be". Why is the old power ratio the standard for "balance"? It was a power ratio that gave far more bargaining power to male American workers than it gave to women and foreigners.

And how do you "restore the balance" in areas where you don't have legal authority? Do you ban imports from other countries that aren't as protective as your rules?

 

[Loren Pechtel]

You can choose to buy Twinkies or not regardless of their cost. There is a choice. If they are too expensive, consumers stop buying. Earning a living is an entirely different matter.

So, let them eat cake? Because people have to eat.

You can eat other things, workers can work for other employers. Either it's theft or it isn't, you can't apply it on only one side.

 

[DBT]

You can choose to buy Twinkies or not regardless of their cost. There is a choice. If they are too expensive, consumers stop buying. Earning a living is an entirely different matter.

So, let them eat cake? Because people have to eat.

You can eat other things, workers can work for other employers. Either it's theft or it isn't, you can't apply it on only one side.

You may have missed the point.