J. Stiglitz: The American Dream has become a myth

[Hawk66]

Originally Posted by Sailor Steve

I simply explained the difference between a 'Right' and a resposibility. I have no right to take from someone if he doesn't feel compelled to give. Doing so makes me a thief, no matter how I try to justify it. Would I steal to feed my family? Certainly. Does that make it my 'Right'? Certainly not.


Not all. Here in the U.S. we have a dichotomy. What the States can do, I would like to see them do. There can be Federal oversight, but the original plan for our National Government was that it would referee between the States and be in charge of foreign policy. I know that's a slightly different subject, and I'm not convinced I'm right (I never am). I only wanted to point out how I see the term 'Rights'.


Yes, he deserves a fair chance. Should you take him into your home? Yes, you should. Do I have the right to force you to raise him and pay his way? No, I don't. Is there a difference between forcing you to raise him and taking some money from everybody to pay for someone else to raise him? If you take money against someone's will, it's stealing. There are two different moral standards at war here, and both are right.

Ok, I can follow your point a little now, although I have not the same opinion or the same understanding of 'Rights' and 'Responsibility' as I described above.

For me all people have simply the right to have same starting conditions as practical matters allows. Else individual life is a lottery, like it is in both countries (U.S. and Germany) to a considerable degree.

Same starting conditions does not mean that the outcome is equal (or in theory like in communism). If somebody is constantly lazy and fortifies his given chances, then it is perfectly fine that his living standards are at a minimum.
If somebody has brilliant ideas, works hard etc. it is perfectly fine that he get rich like J.Stiglitz outlines.

You and August have misunderstood, what I wanted to express with Powell's life. The chances that he got even a medium-ranked officer in the army was a couple of factors more worse compared to his 'competitors'. Just read his book.

[Armistead]

Most considered the dream being part of the middle class, owning a home, benefits, a pension. That dream came true as we built a strong middle class for a large percent of Americans.

Sadly, we're waking a up to a future that will be absent a middle class. I don't think we've seen the worse, it's coming in the next few decades.

[AVGWarhawk]

Most considered the dream.... owning a home.....

This is part of the problem. The dream was offered up at the bequest of big government to have lenders like Fanny Mae and Freddie Mac provide home loans to anyone with a pulse. Getting the American dream. We see where the forced dream came from. It was forced so hard it was regurgitated into what is called foreclosures, abandonment and short sales. Thus ended the American dream for many.

[Hawk66]

In the meantime I've read his book 'The price of inequality'...it is a really good book.

Apart from the inequality debate he shows and proofs that the whole economic could be far more efficient for the benefit of most citizens.

He also very clearly proofs how the the 'top 1%' tries and accomplishes to influence decision making in politics to guarantee their privileges regarding taxes, hidden subsidies and so on.

[Catfish]

As George Carlin put it, it is called American Dream "because you have to be asleep, to believe it".


Certainly you have more 'opportunities' in the US, than in North Korea. But already compared to the new Russia, or other western countries ?

Like everywhere you have to know the right people, or have sheer luck. There's not much about knowledge or capability about it.

[Onkel Neal]

Originally Posted by Skybird

http://www.spiegel.de/international/...-a-858906.html


Stiglitz: This belief is still powerful, but the American dream has become a myth. The life chances of a young US citizen are more dependent on the income and education of his parents than in any other advanced industrial country for which there is data. The belief in the American dream is reinforced by anecdotes, by dramatic examples of individuals who have made it from the bottom to the top -- but what matters most are an individual's life chances. The belief in the American dream is not supported by the data.

Disagree. The American Dream is still there, the system here allows for rags to riches with more ease than ever. Unfortunately, the growing socialist trends of our population are pushing the dream farther away. Why "pull yourself up by your bootstraps" when you can whine about discrimination and insist on receiving aid from the government.

[Oberon]

There's a certain HBO series called 'The Newsroom' which has a good speech during its opening episode in it, but I cannot post a link to it here because it has words in it that will send Sailor Steve after me, but I think that is probably a good speech.

The American dream has not become a myth, it's just been buried by modern life.

[August]

Originally Posted by Neal Stevens

Disagree. The American Dream is still there, the system here allows for rags to riches with more ease than ever. Unfortunately, the growing socialist trends of our population are pushing the dream farther away. Why "pull yourself up by your bootstraps" when you can whine about discrimination and insist on receiving aid from the government.

This ^

[mookiemookie]

Originally Posted by Neal Stevens

the system here allows for rags to riches with more ease than ever.

The whole point of the article was how that's NOT the case. Granted, it's using inductive reasoning to reach the conclusion that the opportunities are not there as they had been in the past. But how else to explain the massive gap between the rich and the poor that becomes larger and larger? I don't buy the fact that it's because poor people are lazy. The gap is so huge and includes so many people that I just find it really hard to believe that there are THAT many people that are unwilling to work or better themselves. It's certainly the case in a lot of cases, I give you that. But I think you also have to acknowledge the fact that the deck is stacked against people when it comes to social mobility.

I mean think about it logically - if you were going to try and better yourself, how would you go about it? School? Higher education is more expensive than it ever has been, by a long shot. In the last 20 years, college tuition costs have tripled. Trade schools could be the answer, but for-profit colleges pile on the debt too.

Small business loans? Bank lending standards are still very tight. You can't just walk into a bank and get an SBA loan for an idea. Trust me, I sat on the other side of that desk and had to turn down person after person who couldn't show me anything more than a business plan.

The prison population has skyrocketed since 1980. What happened in the 70s and early 80s? Hint: rhymes with "Door on Wugs". So with mandatory sentencing guidelines for relatively minor drug offenses, many many more people have records for non-violent offenses than they did in the past. That's not good for someone's rehabilitation prospects. You can blame the individual in that case, and I agree with you, but you still have to deal with the fact that the problem exists.

Like it or not, there's indeed a class war going on and it's on the middle class. They're being squeezed out of the equation. And no one seems to want to see it or do anything about it.

[Dowly]

Originally Posted by Oberon

There's a certain HBO series called 'The Newsroom' which has a good speech during its opening episode in it, but I cannot post a link to it here because it has words in it that will send Sailor Steve after me, but I think that is probably a good speech.

The American dream has not become a myth, it's just been buried by modern life.

Oh you big wussy.

**Language Warning**

[Hawk66]

It is true that some people lack motivation and thus invest not in themselves.

Stiglitz does not claim in his book that equality shall be reached...quite to the contrary...he also agrees to the fact that some inequality is necessary to motivate people to improve their life.

But the major problem is that the economy and a lot of laws, tax rules etc. are built for the top. So what he claims is that there is socialism on the top(my own words to describe this). Look how CEOs are paid...what they are paid for....what happens if they perform bad and so on. And this is just an example of many issues.

I've studied business, national economics and computer science and what I've learned in my studies from the beginning is that there are some key requirements necessary to make markets work. What Stiglitz just claims is not socialism but that in major economic sectors there are no functioning markets anymore due to the lack of competition, lobby-ism and so on. This is just a provable fact.
Even stock markets, in former times the major example for 100% functioning markets, does not meet anymore the requirements, defined by classic national economics definitions...since more and more only a fraction of people/organizations have the understanding how it works, due to the fact that is it is just complete in-transparent (in parts) and designed so by purpose. As an example: who knows the algorithms , used in stock market auto-transaction handling?

It is also a provable fact that the wealth in most Western countries is more and more concentrated. And very often this is not the case due to performance of individuals. Regardless of someones political affiliation, every person who is capable to do simple math cannot deny that this model will not work in the long run or we have not only a 'Arab Spring' but also a 'Western Spring' in the future...

Concerning the 'American Dream': I think it still works for very talented people - or people, which have sth to offer attracting the mass market (I do not judge this negatively ) like Justin Bieber. I also acknowledge that the vast majority of those people put a very high effort to make their dream reality, so it is a combination of luck + their own (big) investment.

But my point and the point of Stiglitz is that we cannot design a model for our economy to make 10% people very rich at the expense of the majority. That's it. Not everybody has the skills to study and have a good graduation and since in Western countries we have more and more the transformation from production to service-oriented economy, we have to find a answer for those people - now and not in some decades. The answer cannot be that those people are the looser or we have a ghettoization in our cities with all the consequences.

I can only everybody recommend to read this book. You do not have to agree on every argument, presented by him (nor do I) but reading his book gives you a broader and - in most parts- a provable understanding how current economic works.

[Skybird]

Unfortunately, the negative symptoms complained about are the logical consequence of any democratic system. This has been known by most of the famous and influential philosophers and thinkers since over 2000 years. Already the ancient Greek knew it, starting with Aristotle and Socrates, and later the Romans, mentioning Cato and Cicero as just two examples.

The following text is in German, unfortunately. It is a compact and imo extremely good summary that gives an overview on the roots of political terms and labels that we use today without knowing the original meanings and historic realities behind these terms. What we value today by describing something as "democracy" or "state", in the times when these terms were first used were only seen as reasons of mayhem and anti-social behaviour, they had anything but a good reputation and where seen as ideas and concepts which were to be avoided, if only that would have been possible. The more these ideas nevertheless got realised over the centuries, the more it meant degenration and fall for the hosting civilizations.

So, it does not need Hoppe to rip apart our cult about democracy. Other authors can do that, too. And very convincingly as well. The author of this text is Rahim Taghizadegan. I recommend to print it out for reading, it is 18-20 pages in Din A4.

!German!
http://www.d-perspektive.de/nc/zeitreport-online/kultur-und-geschichte/detailansicht/article/demokratie-eine-kritische-analyse-von-rahim-taghizadegan-institut-fuer-wertewirtschaft-452/nbp/96.html

To compare our understanding of democracy with that of the ancient Greek, and the European aristocracies and then the American founding father,s is most revealing and an intellectual enlightenment.

In our modern democracies, it is not only not surprising that there is the degeneration taking place that is destroying our civilizations. Thinking it through, like people like Hoppe or Taghizadegan did - or Erik Ritter von Kühnelt-Leddihn, another author I would highly recommend - not only tells you why this kind of self-destruction is taking place, but it also can explain why it is highly unreasonable and unrealistic to expect that in context of these political systems politicians will ever act differently than they do.

[mookiemookie]

Originally Posted by Hawk66

It is true that some people lack motivation and thus invest not in themselves.

Stiglitz does not claim in his book that equality shall be reached...quite to the contrary...he also agrees to the fact that some inequality is necessary to motivate people to improve their life.

But the major problem is that the economy and a lot of laws, tax rules etc. are built for the top. So what he claims is that there is socialism on the top(my own words to describe this). Look how CEOs are paid...what they are paid for....what happens if they perform bad and so on. And this is just an example of many issues.

I've studied business, national economics and computer science and what I've learned in my studies from the beginning is that there are some key requirements necessary to make markets work. What Stiglitz just claims is not socialism but that in major economic sectors there are no functioning markets anymore due to the lack of competition, lobby-ism and so on. This is just a provable fact.
Even stock markets, in former times the major example for 100% functioning markets, does not meet anymore the requirements, defined by classic national economics definitions...since more and more only a fraction of people/organizations have the understanding how it works, due to the fact that is it is just complete in-transparent (in parts) and designed so by purpose. As an example: who knows the algorithms , used in stock market auto-transaction handling?

It is also a provable fact that the wealth in most Western countries is more and more concentrated. And very often this is not the case due to performance of individuals. Regardless of someones political affiliation, every person who is capable to do simple math cannot deny that this model will not work in the long run or we have not only a 'Arab Spring' but also a 'Western Spring' in the future...

Concerning the 'American Dream': I think it still works for very talented people - or people, which have sth to offer attracting the mass market (I do not judge this negatively ) like Justin Bieber. I also acknowledge that the vast majority of those people put a very high effort to make their dream reality, so it is a combination of luck + their own (big) investment.

But my point and the point of Stiglitz is that we cannot design a model for our economy to make 10% people very rich at the expense of the majority. That's it. Not everybody has the skills to study and have a good graduation and since in Western countries we have more and more the transformation from production to service-oriented economy, we have to find a answer for those people - now and not in some decades. The answer cannot be that those people are the looser or we have a ghettoization in our cities with all the consequences.

I can only everybody recommend to read this book. You do not have to agree on every argument, presented by him (nor do I) but reading his book gives you a broader and - in most parts- a provable understanding how current economic works.

Well said. Very well said.

To further your point about stock markets: http://en.wikipedia.org/wiki/Dark_liquidity

The markets aren't even pretending to be transparent anymore.

[Armistead]

One only has to compare wealth. Before the global economy, mass shifting of jobs overseas, other rules and regs that promote the elite, about 60% of Americans held 80% of all real wealth. Today, about 10-15% hold all real wealth.

Americans fought hard for rights, decent wages, protections, etc. for years and wealth became more balanced. We're losing all of that because our jobs can be shipped out. Course, we still vote in the same fools, but the elite own the political system as well, so what do you do?

Fact is, both parties support the elite, bail out the elite and stack laws in favor of the elite. The only trickle down effect is overseas. Today, the stock market soars, unemployment is going up.

Gates, Trump, Buffet all agree the future for the US is a two class system.

[AVGWarhawk]

Armistead:

We're losing all of that because our jobs can be shipped out.

Bottom line.